Latexx Partners 4Q net profit up 157% to RM17m

Latexx Partners 4Q net profit up 157% to RM17m
Written by Joseph Chin
Friday, 05 February 2010 17:47

KUALA LUMPUR: LATEXX PARTNERS BHD []'s net profit in the fourth quarter ended Dec 31, 2009 jumped 157% to RM17.27 million from RM6.72 million a year ago, underpinned by

• recent capacity expansion,
• aggressive marketing strategy and
• overall cost savings.

The glove maker said on Friday, Feb 5

• group revenue increased 47.1% to RM102.84 million from RM69.86 million while
• pre-tax profit increased 158.8% to RM17.39 million from RM6.72 million.
• Earnings per share were 8.86 sen versus 3.45 sen.
• It proposed a dividend of one sen per share.

For FY09,

• group revenue rose by 47.1% to RM328.43 million from RM223.25 million in FY08 while
• net profit jumped 243% to RM52.1 million from RM15.19 million.
• Profit before tax increased 243.6% to RM52.22 million from RM15.20million.

On the outlook, Latexx was upbeat about repeating the FY09 growth in tandem with the growth of world demand for medical gloves in the health sector.

"The strategy of increasing capacity and switching to a better mix of products coupled with more aggressive marketing efforts into new markets will contribute to a sustained flow of profitability," it said.

• Latexx said the installation of eight double formers production lines was completed in December 2009 and is in full operation.
• In addition, the CONSTRUCTION [] of an additional production plant adjacent to existing production facilities is in progress.
• It is expected to start operation in early 2010 and total capacity will increase to 9 billion pieces per annum by 2011.

On Jan 8, Latexx teamed up with Dutch company Budev BV to manufacture and distribute natural rubber gloves that would have non-detectable level of proteins and allergens.

This tie-up with Budev would enable the group to produce a new and potentially higher margin product.

"The JV is expected to benefit the group with a major technological boost and a competitive advantage in the global market. In addition, the group has also targeted to increase nitrile output to more than 30% in the 1st quarter FY2010 due to strong demand," it said.

http://www.theedgemalaysia.com/business-news/159228-latexx-partners-4q-net-profit-up-157-to-rm17m.html

Note:  Latexx's three-year EPS CAGR of 104.4% is the highest in the industry (CIMB Research Feb 2)