SINGAPORE (Feb 12): UG Healthcare, the manufacturer of the Unigloves brand of disposable gloves, announced a 74.9% surge in 2Q earnings of $1.0 million.
This came on the back of a 19.5% growth in revenue to $18.3 million for the 2Q18 ended Dec 31, 2017.
The group says while higher volumes of gloves were produced and sold as a result of the ramp-up in the new production lines that came on stream at the end of June 2017, the higher average selling prices of its proprietary brand of products also contributed to the increase in revenue.
In tandem with the increase in revenue, cost of sales increased by 14.9% to $15.0 million in 2Q18 from $13.1 million in 2Q17.
The twin impact of the volume and average selling price increase lifted gross profit by 46.1% to $3.3 million in 2Q18, up from $2.2 million in 2Q17. Consequently, the group’s gross profit margin increased to 17.8% in 2Q18 from 14.6% in 2Q17.
Total operating expenses, which included marketing and distribution expenses as well as administrative expenses, increased by 41.9% to $2.6 million in 2Q18.
As the group continues to broaden its own downstream distribution business and cultivate demand for its Unigloves brand of disposable glove products, marketing and distribution expenses saw an increase of 11.8% to $0.4 million in 2Q18.
New hires and salary increments led to higher administrative expenses, increasing by 49.2% to $2.2 million in 2Q18 from $1.5 million in 2Q17.
In its outlook, UG Healthcare says the group's expansion plan is on track and it expects to increase production capacity by 500 million pieces to 2.9 billion pieces of gloves per annum by June 30.
The increase is to cope with the expected increase in market demand for its Unigloves products in both developed and developing markets where it has a direct local downstream presence.
Shares in UG Healthcare closed at 18 cents on Monday.
