PETALING JAYA: Hartalega Holdings Bhd’s net profit for the second quarter ended Sept 30, 2022 plummeted to RM28.34 million from RM914.01 million a year ago as revenue fell 70.9% to RM584.56 million from RM2.01 billion in the same quarter last year, mainly attributed to the lower average selling prices (ASP) coupled with a decrease in sales volume by 27%.
It added that rising energy costs such as the increase in natural gas tariffs as well as the introduction of minimum wage policy have also impacted the group’s performance.
Hartalega’s net profit for the cumulative six months also fell to RM116.62 million from RM3.17 billion last year as revenue tumbled 75.8% to RM1.43 billion from RM5.91 billion.
CEO Kuan Mun Leong commented that Hartalega has not been spared from the current global oversupply circumstances.
“However, we are confident that we will pull through and punch above these significant market challenges as the capacity rationalisation continues and move towards equilibrium,” he said in a statement.
Kuan said the group is aligning its Next Generation Integrated Glove Manufacturing Complex 1.5 expansion plan with the current market supply and demand dynamics.
“We are continuing with efforts in reinforcing our advantages. This includes ramping up automation to maximise productivity as well as to achieve energy and cost optimisation.”
Kuan said despite the pent-up inventory and heightened competition in the industry, it remains positive on the long-term prospects as global glove usage is expected to rise in emerging markets with a low glove consumption base.
“Heightened hygiene and health awareness among health practitioners will also drive demand and volume growth of gloves in the long run,” he added.
