Latexx more than doubles net profit to RM21m in 1Q

3.5.2010

KUALA LUMPUR: LATEXX PARTNERS BHD [] more than doubled its net profit to RM20.72 million for the first quarter ended March 31, 2010 (1QFY10) from RM9.14 million a year earlier on the back of capacity expansion, aggressive marketing strategy and overall cost savings.

Revenue surged 79.4% to RM126.17 million from RM70.32 million, while earnings per share rose to 10.52 sen from 4.7 sen. It declared a tax exempt interim dividend of 2.5 sen per share.

In notes accompanying the results on Monday, May 3, Latexx said at pre-tax level, its profit was 37.2% higher at RM23.25 million compared with RM16.95 million recorded in the preceding quarter.

It said despite the increase in raw material prices and the weakening US dollar, the increase in the group’s profit was due principally to increased sales volume and improved overall efficiency achieved giving rise to lower overheads, operational and supervision costs.

Latexx is confident that growth in FY10 will be sustained along with the world’s growing appetite 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 by penetrating into new markets will contribute to sustainable profitability,” it said.

The company said an additional plant next to existing facilities had been completed and the commissioning of the remaining production lines was in progress. It expects to boost production capacity to nine billion pieces of gloves per year by 2011.

Latexx said following its joint-venture agreement (JVA) with Netherlands-based Budev BV, its unit Total Glove Company Sdn Bhd had entered into a licensing agreement with Budev for the exclusive right to use their TECHNOLOGY [] for the treatment of latex examination and surgical gloves to lower protein and allergen to non-detectable levels to prevent allergic reactions.

The JVA and licensing agreement would enable Latexx to embark on a new phase of technology and enhance its product range, and would also allow the group to reinforce its competitive edge in the global market through innovative production methods to produce high quality gloves for its customers, it said.

http://www.theedgemalaysia.com/business-news/165213-latexx-more-than-doubles-net-profit-to-rm21m-in-1q.html

Comment:  Will Latexx be able to achieve MR 100 million net profit for this financial year????