SINGAPORE (Feb 25): Malaysia-based glove manufacturer Riverstone Holdings has reported earnings of 32.9 million ringgit for the 4Q18 ended December, 1.2% higher than earnings of 32.5 million ringgit a year ago.
The increase was mainly due to a 74.4% drop in other operating expenses to 1.3 million ringgit, from 5.0 million ringgit a year ago, due to lower net foreign exchange loss and fair value loss on derivatives.
This brings full-year earnings for FY18 to 129.7 million ringgit, growing 1.6% from 127.6 million ringgit a year ago.
4Q18 revenue rose 22.2% to 257.4 million ringgit, from 210.7 million ringgit.
However, gross profit fell 5.3% to 48.7 million ringgit in 4Q18, from 51.5 million ringgit a year ago, as cost of sales rose 31.1% to outpace the increase in revenue.
Gross profit margin fell 3.6 percentage points to 20.6% for FY18, due to a drop in average selling price for healthcare gloves and a change in product mix.
As at end December, cash and cash equivalents stood at 97.0 million ringgit.
Earnings per share (EPS) rose to 17.50 sen as at 4Q18, from 17.22 sen a year ago.
Riverstone has recommended a final dividend of 5.70 sen per share, unchanged from a year ago. Including an interim dividend of 1.30 sen per share paid earlier, this brings full year dividends to 7.0 sen per share, representing a payout ratio of 40.0%.
“Even as we face an increasingly competitive landscape for our healthcare gloves segment, our core operations remain robust as we have been consistently maintaining high utilisation rates at our factories,” says Wong Teek Son, Riverstone’s executive chairman and CEO.
“Internally, we choose to tackle these headwinds by focusing on improving operational efficiency through the use of automation within our processes and tightening cost controls,” he adds.
Moving ahead, the group says it will add another 1.4 billion pieces of gloves by the end of 2019 for Phase 6 of its expansion plans. This will bring the group’s total annual production capacity to 10.4 billion units.
The group in November last year announced it had acquired approximately 14.64 acres of land in Taiping, Malaysia, to continue to expand its production capacity in future years.
Shares in Riverstone closed 1 cent lower at $1.11 on Monday.
