KUALA LUMPUR: Hartalega Holdings Bhd ’s optimism over an improving industry outlook seems to paying off as the glove maker’s fortunes turned higher over the past financial year.
In its fourth quarter ended March 31, 2024, Hartalega posted a net profit of RM15.12mil, a stark difference to a net loss of RM319.85mil in the same quarter in 2023.
The group’s earnings per share rose to 0.44 sen compared to a loss of 9.36 sen per share previously.
Revenue rose to RM529.83mil from RM517.55mil over the comparative quarter.
According to Hartalega, the improved performance for the quarter was primarily due to higher average selling prices (ASP), mainly attributable to favourable foreign currency exchange movements.
“Despite the higher revenue, operating margins were impacted by the higher raw material and upkeep costs following the ramping up of operations in Hartalega’s Next Generation Integrated Glove Manufacturing Complex production facilities to meet increased demand,” it said.
“The group’s results during the quarter were also supported by the reversal of a provision made for a foreign subsidiary.”
For the full financial year, the group’s net profit swung into the black with RM12.72mil, compared to a net loss of RM235.14mil in FY23.
It said the positive bottom line was supported by higher interest income, foreign currency exchange gains and reversal of certain provisions no longer required during the period under review.
This was in addition to the absence of a one-off impairment loss of assets amounting to RM347mil relating to decommissioning of a facility in Bestari Jaya, Selangor, which was recorded in the previous financial year.
The group’s revenue in FY24, however, fell to RM1.84bil from RM2.41bil in FY23 due to lower sales volume and reduced ASP amid soft market demand during the year under review.
“While challenges persist, we are encouraged by the improving demand outlook and our ongoing measures to enhance operational efficiencies and cost competitiveness.
“On this note, our strategic decision to decommission the Bestari Jaya facility was the right move and has already borne fruit, impacting our bottom line positively,” said chief executive officer Kuan Mun Leong.