Showing posts with label Latexx. Show all posts
Showing posts with label Latexx. Show all posts
Friday 23 September 2011
Saturday 21 May 2011
CIMB positive on proposed Latexx-YTY merger
Written by Kamarul Azhar
Friday, 20 May 2011 12:48
KUALA LUMPUR: The proposed merger of YTY Industry Holdings Sdn Bhd’s wholly-owned subsidiaries with Latexx Partners Bhd is viewed as a positive surprise by analysts. It will create the largest nitrile glove player in the world and the third most profitable rubber glovemaker after Hartalega Corp Bhd and Top Glove Corp Bhd.
According to a CIMB report yesterday, the merged entity would have a combined capacity of 16.2 billion gloves with an estimated 12.8 billion pieces of nitrile capacity, which is a commanding 36% market share. YTY has been focusing on nitrile gloves that make up almost 90% of its production mix.
“We take a positive view of the merger as it could create the largest nitrile glove player in the world. The proposal values YTY at a historical price-earnings ratio of 11.3 times. Assuming FY12/13 earnings growth of 15% per year, in line with demand growth for nitrile gloves, YTY could be valued at a CY12 PER of 8.8 times, a slight premium over the sector’s 8.6 times,” said the report.
Latexx told Bursa Malaysia on Wednesday that it had received a merger proposal from YTY to acquire the latter’s four wholly-owned subsidiaries for RM1.37 billion to be satisfied by RM409.5 million cash from Latexx and 382.2 million new Latexx shares of 50 sen par value at an issue price of RM2.50 per share.
The offer will remain open for acceptance for 21 days.
The proposal arrived just two days after the proposed buyout by Navis Asia VI Management Co Ltd for RM852 million fell through.
CIMB said the proposed Latexx-YTY merger could create an entity that can match Hartalega based on profitability and valuation. Based on CIMB’s pro forma net profit forecast for Latexx of RM162.3 million for the last four quarters, the merged entity could have exceeded Top Glove’s profitability and narrow its valuation as a discount to Hartalega.
“Both Latexx and YTY’s factories are located in Perak; Latexx in Kamunting and YTY in Sitiawan. Note that our pro forma net profit of RM162.3 million has not adjusted for potential cost and revenue synergies arising from the merger,” CIMB said, adding that cost savings of 10% could raise the merged company’s net profit to circa RM180 million.
CIMB also expects the proposed merger to result in Latexx’s existing shareholders enjoying a 20.2% rise in the value of their shares, assuming their equity interest in Latexx is valued at 10.7 times forward PER.
The research house maintained its “neutral” call on Latexx, and recommended a switch to Kossan Rubber Industries Bhd and Hartalega.
This article appeared in The Edge Financial Daily, May 20, 2011.
Friday, 20 May 2011 12:48
KUALA LUMPUR: The proposed merger of YTY Industry Holdings Sdn Bhd’s wholly-owned subsidiaries with Latexx Partners Bhd is viewed as a positive surprise by analysts. It will create the largest nitrile glove player in the world and the third most profitable rubber glovemaker after Hartalega Corp Bhd and Top Glove Corp Bhd.
According to a CIMB report yesterday, the merged entity would have a combined capacity of 16.2 billion gloves with an estimated 12.8 billion pieces of nitrile capacity, which is a commanding 36% market share. YTY has been focusing on nitrile gloves that make up almost 90% of its production mix.
“We take a positive view of the merger as it could create the largest nitrile glove player in the world. The proposal values YTY at a historical price-earnings ratio of 11.3 times. Assuming FY12/13 earnings growth of 15% per year, in line with demand growth for nitrile gloves, YTY could be valued at a CY12 PER of 8.8 times, a slight premium over the sector’s 8.6 times,” said the report.
Latexx told Bursa Malaysia on Wednesday that it had received a merger proposal from YTY to acquire the latter’s four wholly-owned subsidiaries for RM1.37 billion to be satisfied by RM409.5 million cash from Latexx and 382.2 million new Latexx shares of 50 sen par value at an issue price of RM2.50 per share.
The offer will remain open for acceptance for 21 days.
The proposal arrived just two days after the proposed buyout by Navis Asia VI Management Co Ltd for RM852 million fell through.
CIMB said the proposed Latexx-YTY merger could create an entity that can match Hartalega based on profitability and valuation. Based on CIMB’s pro forma net profit forecast for Latexx of RM162.3 million for the last four quarters, the merged entity could have exceeded Top Glove’s profitability and narrow its valuation as a discount to Hartalega.
“Both Latexx and YTY’s factories are located in Perak; Latexx in Kamunting and YTY in Sitiawan. Note that our pro forma net profit of RM162.3 million has not adjusted for potential cost and revenue synergies arising from the merger,” CIMB said, adding that cost savings of 10% could raise the merged company’s net profit to circa RM180 million.
CIMB also expects the proposed merger to result in Latexx’s existing shareholders enjoying a 20.2% rise in the value of their shares, assuming their equity interest in Latexx is valued at 10.7 times forward PER.
The research house maintained its “neutral” call on Latexx, and recommended a switch to Kossan Rubber Industries Bhd and Hartalega.
This article appeared in The Edge Financial Daily, May 20, 2011.
Wednesday 18 May 2011
Public Bank best-managed company
Nazir voted best CEO, Public Bank best-managed company
By Hamisah HamidPublished: 2011/05/17
Read more: Nazir voted best CEO, Public Bank best-managed company http://www.btimes.com.my/Current_News/BTIMES/articles/16ASIABEST/Article/#ixzz1MfOWuUI3
By Hamisah HamidPublished: 2011/05/17
Read more: Nazir voted best CEO, Public Bank best-managed company http://www.btimes.com.my/Current_News/BTIMES/articles/16ASIABEST/Article/#ixzz1MfOWuUI3
KUALA LUMPUR: Public Bank Bhd emerged top in four out of nine categories under FinanceAsia's "Asia's best managed companies" country listings, while CIMB Group chief executive officer (CEO) Datuk Seri Nazir Razak was voted the "Best CEO".
Maxis' chief Sandip Dass was the runner-up for the "Best CEO", followed by Public Bank chief Tan Sri Tay Ah Lek in third place.
Malaysia's third largest bank in terms of asset and market capitalisation, Public Bank was polled the "Best managed company", "Best corporate governance", "Best corporate social responsibility" and "Most committed to a strong dividend policy".
The country's second largest lender CIMB Group, which topped the polls in "Best investor relations" category, came second after Public Bank in the four categories.
AirAsia Bhd was voted the "Best mid-cap", while integrated media group Media Prima Bhd came second in that category.
Gloves maker Latexx Partners Bhd was voted the "Best small-cap".
Malayan Banking Bhd chief finance officer (CFO) Khairussaleh Ramli was polled the "Best CFO".
Hong-Kong based FinanceAsia revealed the poll results for India and Malaysia on its website yesterday.
The publication has tallied votes from over 300 investors and analysts across the region for its 11th annual poll of Asia's top companies.
Read more: Nazir voted best CEO, Public Bank best-managed company http://www.btimes.com.my/Current_News/BTIMES/articles/16ASIABEST/Article/#ixzz1MfOFzehO
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Maxis' chief Sandip Dass was the runner-up for the "Best CEO", followed by Public Bank chief Tan Sri Tay Ah Lek in third place.
Malaysia's third largest bank in terms of asset and market capitalisation, Public Bank was polled the "Best managed company", "Best corporate governance", "Best corporate social responsibility" and "Most committed to a strong dividend policy".
The country's second largest lender CIMB Group, which topped the polls in "Best investor relations" category, came second after Public Bank in the four categories.
AirAsia Bhd was voted the "Best mid-cap", while integrated media group Media Prima Bhd came second in that category.
Malayan Banking Bhd chief finance officer (CFO) Khairussaleh Ramli was polled the "Best CFO".
Hong-Kong based FinanceAsia revealed the poll results for India and Malaysia on its website yesterday.
The publication has tallied votes from over 300 investors and analysts across the region for its 11th annual poll of Asia's top companies.
Read more: Nazir voted best CEO, Public Bank best-managed company http://www.btimes.com.my/Current_News/BTIMES/articles/16ASIABEST/Article/#ixzz1MfOFzehO
Tuesday 8 February 2011
Latexx continues to see strong performance in its business for the remaining quarter of the year
| Announcement Date | Financial Yr. End | Qtr | Period End | Revenue RM '000 | Profit/Lost RM'000 | EPS | Prof. Marg % | ||||||
| 10-Nov-10 | 31-Dec-10 | 3 | 30-Sep-10 | 129,878 | 17,625 | 8.19 | 13.6% | ||||||
| 06-Aug-10 | 31-Dec-10 | 2 | 30-Jun-10 | 134,483 | 21,551 | 10.01# | 16..0% | ||||||
| 03-May-10 | 31-Dec-10 | 1 | 31-Mar-10 | 126,171 | 20,715 | 9.63# | 16.4% | ||||||
| 02-Nov-09 | 31-Dec-09 | 3 | 30-Sep-09 | 80,839 | 14,274 | 6.63# | 17.7% | ||||||
#Basic EPS adjusted for capital changes
9M 2010 (unaudited)
Revenue 390.532m
Earnings 59.891m
Profit Margin = 59.891 / 390.532 = 15.3%
Estimated 12M 2010
Estimated Revenue = 390.532 x (4/3) = 520.71m
Estimated Profit Margin = 14%
Estimated Earnings = 14% x 520.71m = 72.90m
Navis is offering 852.03m to take the whole business private.
At this offer price, the PE = 852.03 / 72.90 = 11.7 x
30.9.2010
Total Equity 233.895m
P/B = 852.03 / 233.895 = 3.64 x
(Net Asset Value per share = 1.0700)
Cash and bank balances 54.614m
Long term borrowings 18.536m
Short term borrowings 18.783m
Current portion of long-term borrowings 3.551m
Hire purchase/lease creditors 14.300m
Net Cash = -0.556m
Current Assets 172.342m
Current Liabilities 107.024m
Current Ratio 1.61 x
Cash Flow Statement
Net CFO 55.627m
CFI (9.915m)
FCF 45.712m
Outlook
In summary, we strongly believe that with the company’s ability to pass-on costs to customers, coupled with our strategies to focus on the premium segments in both nitrile and natural rubber, we are able to cope with the temporary headwinds and move on to advance our market presence. The Group continues to see a strong performance in its business for the remaining quarter of the year. The Board expects the demand for the Group’s products and services to improve further in the fourth quarter and the business of the Group for the remaining period to the end of the financial year to remain strong. Nevertheless, Latexx will continuously strive to produce the highest quality of gloves through the adoption of the latest techniques, technology and to train and motivate our employees for the enhancement of efficiency and productivity and pursue to be caring organization through our commitment to the well being of environment and community.
Current Quarter 3 months ended 30.09.10 | |
Weighted average number of ordinary shares in issue (‘000) | 215,095 |
Effects of dilutive potential ordinary shares on conversion of warrants (‘000) | 44,611 |
Adjusted weighted average number of ordinary shares in issue and issuable (‘000) | 259,706 |
Monday 7 February 2011
Latexx Partners says Navis has sufficient funds for takeover
Latexx Partners says Navis has sufficient funds for takeover
Written by Joseph Chin of theedgemalaysia.com
Wednesday, 02 February 2011 08:49
KUALA LUMPUR: LATEXX PARTNERS BHD [], which received a takeover offer from Navis Asia VI Management Company Ltd, has vouched that the fund management’s RM852.03 million offer would not fail as it has sufficient resources.
In reply to a query from Bursa Malaysia, Latexx said on Wednesday, Feb 2 that Navis confirmed that it had sufficient financial resources to undertake the acquisition as it currently has over US$3 billion in capital under management and had sufficient unutilised funds for the acquisition.
On Monday, Navis Asia offered RM852.03 million to acquire all of Latexx’s assets and liabilities for RM852.03 million or RM3.10 per share, which was 30 sen above the last traded price of RM2.80.
Latexx also said the takeover was in the best interest of of the company as the offer price was a premium of about 20% over the pre-disturbance closing price of RM2.58 per share (that is closing market price on Jan 26) and about 19.7% over the five-day volume weighted average market price up to Jan 26.
“The offer price represents a premium of approximately 189% over the unaudited consolidated net assets per share of the company as at Sept 30, 2010 of RM1.07 and a premium of approximately 260% over the audited consolidated net assets per share of the company as at Dec 31, 2009 of 86 sen,” it said.
Latexx added the acquiror’s track record reflected their ability to grow the business after the acquisition.
“After having considered the factors above, the board believes that the disposal is in the best interest of Latexx. The board will be appointing a principal adviser and an independent adviser to advise the shareholders on the fairness and reasonableness of the proposal,” it said.
It added the board does not intend to maintain the listing status of Latexx and the company will be delisted after the distribution of the cash and/or securities to shareholders and warrantholders.
Written by Joseph Chin of theedgemalaysia.com
Wednesday, 02 February 2011 08:49
KUALA LUMPUR: LATEXX PARTNERS BHD [], which received a takeover offer from Navis Asia VI Management Company Ltd, has vouched that the fund management’s RM852.03 million offer would not fail as it has sufficient resources.
In reply to a query from Bursa Malaysia, Latexx said on Wednesday, Feb 2 that Navis confirmed that it had sufficient financial resources to undertake the acquisition as it currently has over US$3 billion in capital under management and had sufficient unutilised funds for the acquisition.
On Monday, Navis Asia offered RM852.03 million to acquire all of Latexx’s assets and liabilities for RM852.03 million or RM3.10 per share, which was 30 sen above the last traded price of RM2.80.
Latexx also said the takeover was in the best interest of of the company as the offer price was a premium of about 20% over the pre-disturbance closing price of RM2.58 per share (that is closing market price on Jan 26) and about 19.7% over the five-day volume weighted average market price up to Jan 26.
“The offer price represents a premium of approximately 189% over the unaudited consolidated net assets per share of the company as at Sept 30, 2010 of RM1.07 and a premium of approximately 260% over the audited consolidated net assets per share of the company as at Dec 31, 2009 of 86 sen,” it said.
Latexx added the acquiror’s track record reflected their ability to grow the business after the acquisition.
“After having considered the factors above, the board believes that the disposal is in the best interest of Latexx. The board will be appointing a principal adviser and an independent adviser to advise the shareholders on the fairness and reasonableness of the proposal,” it said.
It added the board does not intend to maintain the listing status of Latexx and the company will be delisted after the distribution of the cash and/or securities to shareholders and warrantholders.
Thursday 27 January 2011
Latexx to be privatised? The consensus target price on the stock is RM3.49.
Latexx to be privatised?
Written by Yantoultra Ngui Yichen
Thursday, 27 January 2011 11:43
KUALA LUMPUR: Talk of privatisation of Latexx Partners Bhd has surfaced amid the continuous rise in latex price and the weakening US dollar which have hit the once-favoured rubber gloves industry.
The counter has been actively traded recently, with an average daily transacted volume of some 1.3 million shares for the past 10 days, according to Bloomberg data.
Latexx closed 2.27% or six sen lower to RM2.58 yesterday with a total of 3.1 million shares traded. Its shares hit a 52-week high of RM4.25 on April 7, 2010 while its 52-week low was RM2.37 on Sept 24, 2010
A company official said she had no clue on the matter when contacted by The Edge Financial Daily, but said the rumour of possible privatisation had been going around for some time.
Latexx’s executive chairman and CEO Low Bok Tek was not available to comment at press time.
According to Bloomberg data, BT Capital Sdn Bhd is the major shareholder of Latexx with 49.57 million shares or a 22.55% stake, followed by Low with 15.47 million shares (7.04%) and Lembaga Tabung Haji with 11.68 million shares (5.32%).
Given that Low is a shareholder of BT Capital, his direct and deemed interest in Latexx amount to 29.59% stake.
Rubber glove manufacturers took a hit recently from the continuous rise in latex prices and a depreciating US dollar. But analysts said this was not the first time glove manufacturers were facing this situation.
According to an analyst, glove makers have shown they are able to pass on the cost of higher latex prices and weaker greenback to end-consumers, though at one to two months’ lag.
Despite the headwinds, rubber glove makers were still positive on the back of robust demand from traditional healthcare usage and new segments such as the food and services industry.
“The demand growth for gloves has remained healthy although the concern for H1N1 has faded,” Latexx said in notes accompanying its financial statements to Bursa Malaysia on Nov 10. “Upon normalising, the demand for gloves still grows at 10% to 12% annually, which indicates a remarkable upside for any industry.”
Latexx’s present undemanding valuation could be fuelling privatisation speculation and generating interest on the stock.
According to Bloomberg data, the counter is trading at a forward price-to-earnings ratio (PER) of 7.27 times, lower than prevailing average valuations for the rubber sector.
Its bigger peers such as Hartalega Holdings Bhd is trading at a forward PER of 10.91 times, Top Glove Bhd at 14.62 times, Kossan Rubber Industries Bhd at 8.63 times and Supermax Corp Bhd at 8.53 times.
Other peers such as Rubberex Corp (M) Bhd is trading at a historical PER of 11.11 times and Integrated Rubber Corp Bhd at 24.59 times. Latexx trades at a historical PER of 6.8 times.
With net asset per share of RM1.07 as at Sept 30, Latexx trades at a price-to-book ratio of 2.41 times.
For the nine months ended Sept 30, Latexx’s revenue totalled RM390.53 million, up 73.11% from the previous corresponding period while net profit totalled RM59.89 million, a jump of 71.95% from RM34.83 million previously.
Latexx is relatively cash rich; it had a net cash of RM17.29 million as at Sept 30, with RM18.54 million in long-term borrowings, RM18.78 million in short-term borrowings and RM54.61 million cash.
Analysts are bullish on Latexx despite the continuous increase in average latex price and the weakening US dollar. All four analysts who released reports on its most recent results had a “buy” recommendation on the stock.
The consensus target price on the stock is RM3.49, according to Bloomberg data. This is 35% or 91 sen higher than yesterday’s closing price of RM2.58, which gave the company a market capitalisation of RM567.1 million.
For one, MIMB Investment Bank said it was still positive on the stock as it was expected to focus on operational efficiencies and cost control to boost earnings going forward.
“Notwithstanding the headwinds in the industry, Latexx is expected to continue with its expansion plans,” the research house said in a note to clients on Nov 11, 2010.
According to Latexx in notes accompanying its financial statements to Bursa, the construction of an additional production plant adjacent to existing production facilities has been completed.
Nine double formers and two single formers glove production lines were commissioned and had since started operations, said the company. The expansion was expected to raise its annual production capacity from seven billion pieces to nine billion pieces by 2011, it added.
This article appeared in The Edge Financial Daily, January 27, 2011.
Written by Yantoultra Ngui Yichen
Thursday, 27 January 2011 11:43
KUALA LUMPUR: Talk of privatisation of Latexx Partners Bhd has surfaced amid the continuous rise in latex price and the weakening US dollar which have hit the once-favoured rubber gloves industry.
The counter has been actively traded recently, with an average daily transacted volume of some 1.3 million shares for the past 10 days, according to Bloomberg data.
Latexx closed 2.27% or six sen lower to RM2.58 yesterday with a total of 3.1 million shares traded. Its shares hit a 52-week high of RM4.25 on April 7, 2010 while its 52-week low was RM2.37 on Sept 24, 2010
A company official said she had no clue on the matter when contacted by The Edge Financial Daily, but said the rumour of possible privatisation had been going around for some time.
Latexx’s executive chairman and CEO Low Bok Tek was not available to comment at press time.
According to Bloomberg data, BT Capital Sdn Bhd is the major shareholder of Latexx with 49.57 million shares or a 22.55% stake, followed by Low with 15.47 million shares (7.04%) and Lembaga Tabung Haji with 11.68 million shares (5.32%).
Given that Low is a shareholder of BT Capital, his direct and deemed interest in Latexx amount to 29.59% stake.
Rubber glove manufacturers took a hit recently from the continuous rise in latex prices and a depreciating US dollar. But analysts said this was not the first time glove manufacturers were facing this situation.
According to an analyst, glove makers have shown they are able to pass on the cost of higher latex prices and weaker greenback to end-consumers, though at one to two months’ lag.
Despite the headwinds, rubber glove makers were still positive on the back of robust demand from traditional healthcare usage and new segments such as the food and services industry.
“The demand growth for gloves has remained healthy although the concern for H1N1 has faded,” Latexx said in notes accompanying its financial statements to Bursa Malaysia on Nov 10. “Upon normalising, the demand for gloves still grows at 10% to 12% annually, which indicates a remarkable upside for any industry.”
Latexx’s present undemanding valuation could be fuelling privatisation speculation and generating interest on the stock.
According to Bloomberg data, the counter is trading at a forward price-to-earnings ratio (PER) of 7.27 times, lower than prevailing average valuations for the rubber sector.
Its bigger peers such as Hartalega Holdings Bhd is trading at a forward PER of 10.91 times, Top Glove Bhd at 14.62 times, Kossan Rubber Industries Bhd at 8.63 times and Supermax Corp Bhd at 8.53 times.
Other peers such as Rubberex Corp (M) Bhd is trading at a historical PER of 11.11 times and Integrated Rubber Corp Bhd at 24.59 times. Latexx trades at a historical PER of 6.8 times.
With net asset per share of RM1.07 as at Sept 30, Latexx trades at a price-to-book ratio of 2.41 times.
For the nine months ended Sept 30, Latexx’s revenue totalled RM390.53 million, up 73.11% from the previous corresponding period while net profit totalled RM59.89 million, a jump of 71.95% from RM34.83 million previously.
Latexx is relatively cash rich; it had a net cash of RM17.29 million as at Sept 30, with RM18.54 million in long-term borrowings, RM18.78 million in short-term borrowings and RM54.61 million cash.
Analysts are bullish on Latexx despite the continuous increase in average latex price and the weakening US dollar. All four analysts who released reports on its most recent results had a “buy” recommendation on the stock.
The consensus target price on the stock is RM3.49, according to Bloomberg data. This is 35% or 91 sen higher than yesterday’s closing price of RM2.58, which gave the company a market capitalisation of RM567.1 million.
For one, MIMB Investment Bank said it was still positive on the stock as it was expected to focus on operational efficiencies and cost control to boost earnings going forward.
“Notwithstanding the headwinds in the industry, Latexx is expected to continue with its expansion plans,” the research house said in a note to clients on Nov 11, 2010.
According to Latexx in notes accompanying its financial statements to Bursa, the construction of an additional production plant adjacent to existing production facilities has been completed.
Nine double formers and two single formers glove production lines were commissioned and had since started operations, said the company. The expansion was expected to raise its annual production capacity from seven billion pieces to nine billion pieces by 2011, it added.
This article appeared in The Edge Financial Daily, January 27, 2011.
Saturday 15 January 2011
A Brief Look at Latexx
Latexx Partners Berhad
Business Description:
Latexx Partners Berhad is a Malaysia-based company engaged in investment holding and trading of rubber gloves. The Company, through its subsidiaries, is engaged in manufacturing and sale of examination rubber gloves. Its subsidiaries are Latexx Manufacturing Sdn. Bhd., which is engaged in manufacturing of rubber gloves; Medtexx Manufacturing Sdn. Bhd., which is engaged in trading of rubber gloves and letting of glove manufacturing plant and machinery, and Total Glove Company Sdn. Bhd.
Current Price (7/1/2011): 2.68
2009 Sales 328,473,188
Employees: 1,976
Market Cap: 586,448,320
Shares Outstanding: 218,824,000
Closely Held Shares: 59,489,900
Estimated basic EPS for 2011 = 4*8.19 = 32.76 sen
Estimated diluted EPS for 2011 = (4*8.19) x [218.824 / (218.824 + 57.55)] = 25.94 sen
At price of 2.68, the prospective basic PE = 2.68 / 0.3276 = 8.2 x
At price of 2.68, the prospective diluted PE = 2.68 / 0.2594 = 10.3 x
Year DPS EPS
2002 0.0 -29.7
2003 0.0 -16.9
2004 0.0 -12.0
2005 0.0 5.2
2006 0.0 4.8
2007 0.0 2.7
2008 0.0 8.4
2009 2.0 27.0
9M10 5.0 28.76 NTA 1.07
Historical
5 Yr
PE range 6.8 - 20.3
DY range 1.3% - 0.3%
10 Yr
PE range 6.6 - 19.3
DY range 0.6% - 0.2%
Business Description:
Latexx Partners Berhad is a Malaysia-based company engaged in investment holding and trading of rubber gloves. The Company, through its subsidiaries, is engaged in manufacturing and sale of examination rubber gloves. Its subsidiaries are Latexx Manufacturing Sdn. Bhd., which is engaged in manufacturing of rubber gloves; Medtexx Manufacturing Sdn. Bhd., which is engaged in trading of rubber gloves and letting of glove manufacturing plant and machinery, and Total Glove Company Sdn. Bhd.
| Announcement Date | Financial Yr. End | Qtr | Period End | Revenue RM '000 | Profit/Lost RM'000 | EPS | Amended | ||||||
| 10-Nov-10 | 31-Dec-10 | 3 | 30-Sep-10 | 129,878 | 17,625 | 8.19 | - | ||||||
| 06-Aug-10 | 31-Dec-10 | 2 | 30-Jun-10 | 134,483 | 21,551 | 10.39 | - | ||||||
| 03-May-10 | 31-Dec-10 | 1 | 31-Mar-10 | 126,171 | 20,715 | 10.52 | - | ||||||
| 02-Nov-09 | 31-Dec-09 | 3 | 30-Sep-09 | 80,839 | 14,274 | 7.33 | - | ||||||
Current Price (7/1/2011): 2.68
2009 Sales 328,473,188
Employees: 1,976
Market Cap: 586,448,320
Shares Outstanding: 218,824,000
Closely Held Shares: 59,489,900
Estimated basic EPS for 2011 = 4*8.19 = 32.76 sen
Estimated diluted EPS for 2011 = (4*8.19) x [218.824 / (218.824 + 57.55)] = 25.94 sen
At price of 2.68, the prospective basic PE = 2.68 / 0.3276 = 8.2 x
At price of 2.68, the prospective diluted PE = 2.68 / 0.2594 = 10.3 x
Year DPS EPS
2002 0.0 -29.7
2003 0.0 -16.9
2004 0.0 -12.0
2005 0.0 5.2
2006 0.0 4.8
2007 0.0 2.7
2008 0.0 8.4
2009 2.0 27.0
9M10 5.0 28.76 NTA 1.07
Historical
5 Yr
PE range 6.8 - 20.3
DY range 1.3% - 0.3%
10 Yr
PE range 6.6 - 19.3
DY range 0.6% - 0.2%
Capital Changes
2006 Capital Reconstruction
Warrant 57.55m units Maturity 6/6/2017 Ex Pr RM 0.53
Monday 3 January 2011
Tuesday 7 December 2010
Latexx advances market share
Latexx advances market share
by Justin Yap. Posted on November 11, 2010, Thursday
Company to focus on premium segments to cope with temporary headwinds
HIGH-TECH PRODUCTION: Photo shows a Latexx employee working with an incubator machine.
KUCHING: Latexx Partners Bhd’s (Latexx) ability to pass on costs to customers, coupled with its strategies to focus on the premium segments has enabled it to cope with the temporary headwinds and move on to advance its market presence.
Latexx announced results for the third quarter ended September 30, 2010 (3Q10) yesterday. The group recorded revenue of RM129.88 million for 3Q10, a 60.7 per cent growth from the same quarter a year ago (3Q09). For the current quarter, the group achieved net profit of RM17.63 million.
For the current year to date, the group sales revenue for the nine months ended September 30, 2010 increased 73.1 per cent to RM390.53 million from RM225.59 million for the corresponding period last year.
“The significant increase in revenue and improve-ment in the net profit of the current year was mainly due to the increase in overall sales volume, driven by the strong demand of gloves and the group’s capacity expansion,” said its chief executive officer (CEO) and chairman Low Bok Tek when contacted by The Borneo Post.
“The stronger performance was also attributed by measures taken to improve the efficiency in operation control as well as the intensified and aggressive marketing strategy,” he added.
The balance sheet position of the group continued to strengthen in 3Q10 compared with the preceding quarter. The net cash flow from operating activities as at September 30, 2010 was RM55.6 million, 30.8 per cent higher than the previous quarter of RM42.5 million.
When asked on the market glove demand, Low explained, “It had remained healthy although the concern for H1N1 had faded. Upon normalising, the demand for gloves still grew at 10 per cent to 12 per cent annually, which indicates a remarkable upside for any industry.
“Over the years, growing hygiene awareness and increased healthcare spending have made gloves a necessity in the healthcare sector, especially, in developed economies, thus making the industry resilient even when economy is slowing down.”
Looking at its strategic market positioning with thin nitrile gloves in the non-medical sector, Latexx head of corporate services Dr Liew Lai Lai said, “The sustained high level of latex prices is still the biggest challenge faced by all glove makers. Keeping abreast with the changing industry landscape, we have since adopted a few contingency strategies to adapt itself to the environment.
“Besides continuing to place more focus on the premium product segment that is relatively more resilient, we have also started offering a range of thinner, good quality and more price competitive nitrile gloves to both the medical and non-medical sector.”
Currently, almost 90 per cent of the group’s sales were to the medical sector; hence, the group was aiming to enlarge its revenue base by venturing into the non-medical sector. Latexx projected its range of thin and value priced nitrile gloves would be able to effectively substitute the lower-end natural rubber (NR) powdered gloves in the food and industrial market segment.
Latexx further foresaw that the latex price in the future would be lingering on the increasing trend and it believed that the sales of its range of thin nitrile gloves would increase substantially and significantly boost the revenue and profitability of the group by 2011.
The company also has strategically positioned itself in the premium NR gloves segment, with the launching of the first-in-the world NR powder-free gloves with unquantifiable protein level.
“This premium product range is currently the most effective solution to the threats of protein allergy for glove users,” said Liew.
“Based on the initial market response that we managed to obtain at this stage, the market is responding well and we strongly believes that these value-added natural latex gloves are able to create a demand and be widely accepted by the market and industry globally,” added Low.
He also revealed that the construction of an additional production plant adjacent to existing production facilities had been completed. The commissioning of glove production lines was done in accordance to schedule.
“Nine double formers and two single formers glove production lines were commissioned and have since started operation. The commissioning of the remaining glove production lines is in progress and is expected to increase the total capacity to nine billion pieces per annum by next year,” said the chairman.
The group continued to see a strong performance in its business for the remaining quarter of the year. “The board of directors expects the demand for the products and services to improve further in the fourth quarter and the business to remain strong until end of the financial year,” Liew concluded.
http://www.theborneopost.com/?p=74376
by Justin Yap. Posted on November 11, 2010, Thursday
Company to focus on premium segments to cope with temporary headwinds
HIGH-TECH PRODUCTION: Photo shows a Latexx employee working with an incubator machine.
KUCHING: Latexx Partners Bhd’s (Latexx) ability to pass on costs to customers, coupled with its strategies to focus on the premium segments has enabled it to cope with the temporary headwinds and move on to advance its market presence.
Latexx announced results for the third quarter ended September 30, 2010 (3Q10) yesterday. The group recorded revenue of RM129.88 million for 3Q10, a 60.7 per cent growth from the same quarter a year ago (3Q09). For the current quarter, the group achieved net profit of RM17.63 million.
For the current year to date, the group sales revenue for the nine months ended September 30, 2010 increased 73.1 per cent to RM390.53 million from RM225.59 million for the corresponding period last year.
“The significant increase in revenue and improve-ment in the net profit of the current year was mainly due to the increase in overall sales volume, driven by the strong demand of gloves and the group’s capacity expansion,” said its chief executive officer (CEO) and chairman Low Bok Tek when contacted by The Borneo Post.
“The stronger performance was also attributed by measures taken to improve the efficiency in operation control as well as the intensified and aggressive marketing strategy,” he added.
The balance sheet position of the group continued to strengthen in 3Q10 compared with the preceding quarter. The net cash flow from operating activities as at September 30, 2010 was RM55.6 million, 30.8 per cent higher than the previous quarter of RM42.5 million.
When asked on the market glove demand, Low explained, “It had remained healthy although the concern for H1N1 had faded. Upon normalising, the demand for gloves still grew at 10 per cent to 12 per cent annually, which indicates a remarkable upside for any industry.
“Over the years, growing hygiene awareness and increased healthcare spending have made gloves a necessity in the healthcare sector, especially, in developed economies, thus making the industry resilient even when economy is slowing down.”
Looking at its strategic market positioning with thin nitrile gloves in the non-medical sector, Latexx head of corporate services Dr Liew Lai Lai said, “The sustained high level of latex prices is still the biggest challenge faced by all glove makers. Keeping abreast with the changing industry landscape, we have since adopted a few contingency strategies to adapt itself to the environment.
“Besides continuing to place more focus on the premium product segment that is relatively more resilient, we have also started offering a range of thinner, good quality and more price competitive nitrile gloves to both the medical and non-medical sector.”
Currently, almost 90 per cent of the group’s sales were to the medical sector; hence, the group was aiming to enlarge its revenue base by venturing into the non-medical sector. Latexx projected its range of thin and value priced nitrile gloves would be able to effectively substitute the lower-end natural rubber (NR) powdered gloves in the food and industrial market segment.
Latexx further foresaw that the latex price in the future would be lingering on the increasing trend and it believed that the sales of its range of thin nitrile gloves would increase substantially and significantly boost the revenue and profitability of the group by 2011.
The company also has strategically positioned itself in the premium NR gloves segment, with the launching of the first-in-the world NR powder-free gloves with unquantifiable protein level.
“This premium product range is currently the most effective solution to the threats of protein allergy for glove users,” said Liew.
“Based on the initial market response that we managed to obtain at this stage, the market is responding well and we strongly believes that these value-added natural latex gloves are able to create a demand and be widely accepted by the market and industry globally,” added Low.
He also revealed that the construction of an additional production plant adjacent to existing production facilities had been completed. The commissioning of glove production lines was done in accordance to schedule.
“Nine double formers and two single formers glove production lines were commissioned and have since started operation. The commissioning of the remaining glove production lines is in progress and is expected to increase the total capacity to nine billion pieces per annum by next year,” said the chairman.
The group continued to see a strong performance in its business for the remaining quarter of the year. “The board of directors expects the demand for the products and services to improve further in the fourth quarter and the business to remain strong until end of the financial year,” Liew concluded.
http://www.theborneopost.com/?p=74376
Thursday 11 November 2010
Latexx Partners 3Q net profit up 23.5% to RM17.62m
Latexx Partners 3Q net profit up 23.5% to RM17.62m
Written by Joseph Chin
Wednesday, 10 November 2010 13:45
KUALA LUMPUR: LATEXX PARTNERS BHD [] reported a set of stronger earnings at RM17.62 million in the third quarter ended Sept 30, an increase of 23.5% from RM14.27 million a year ago.
It said on Wednesday, Nov 10 revenue rose 60.7% to RM129.87 million from RM80.84 million. Profit before tax rose 41.3% to RM20.16 million from RM14.27 million. Earnings per share were 8.19 sen compared with 7.33 sen. It declared an interim dividend of 2.5 sen per share.
For the nine-month period, revenue increased 73.1% to RM390.53 million from RM225.59 million from the previous corresponding period. Profit before tax and profit after tax increased by 93.9% and 72.0% respectively to RM67.53 million and RM59.89 million.
“The increase in the group’s revenue and improvement in the net profit of the current year was mainly due to the increase in overall sales volume, driven by the strong demand of gloves and the group’s expanded capacity from 4.5 billion pieces per annum to 7.0 billion pieces per annum.
“The stronger performance was also attributed by measures taken to improve the effectiveness and efficiency in operation control; as well as intensified and aggressive marketing strategy,” it said.
http://www.theedgemalaysia.com/business-news/176830-latexx-partners-3q-net-profit-up-235-to-rm1762m.html
Written by Joseph Chin
Wednesday, 10 November 2010 13:45
KUALA LUMPUR: LATEXX PARTNERS BHD [] reported a set of stronger earnings at RM17.62 million in the third quarter ended Sept 30, an increase of 23.5% from RM14.27 million a year ago.
It said on Wednesday, Nov 10 revenue rose 60.7% to RM129.87 million from RM80.84 million. Profit before tax rose 41.3% to RM20.16 million from RM14.27 million. Earnings per share were 8.19 sen compared with 7.33 sen. It declared an interim dividend of 2.5 sen per share.
For the nine-month period, revenue increased 73.1% to RM390.53 million from RM225.59 million from the previous corresponding period. Profit before tax and profit after tax increased by 93.9% and 72.0% respectively to RM67.53 million and RM59.89 million.
“The increase in the group’s revenue and improvement in the net profit of the current year was mainly due to the increase in overall sales volume, driven by the strong demand of gloves and the group’s expanded capacity from 4.5 billion pieces per annum to 7.0 billion pieces per annum.
“The stronger performance was also attributed by measures taken to improve the effectiveness and efficiency in operation control; as well as intensified and aggressive marketing strategy,” it said.
http://www.theedgemalaysia.com/business-news/176830-latexx-partners-3q-net-profit-up-235-to-rm1762m.html
Wednesday 10 November 2010
Prices set to rise as glove makers protect profit margin
Prices set to rise as glove makers protect profit margin
By Ooi Tee Ching
Published: 2010/11/10
THE average selling price of rubber gloves, at US$30 (RM93) per 1,000 pieces, is set to trend higher because manufacturers need to protect profit margin, Supermax Corp said.
"We are quoting selling prices more frequently. We do it on a weekly basis to better match the volatile currency movement and rising raw material costs. We need to preserve our profit margin," said executive chairman and group managing director Datuk Seri Stanley Thai.
In the recent quarterly reporting season of March to June, many rubber glove manufacturers suffered lower earnings from slower than expected cost pass-through of rising latex prices and weakening US dollar.
Yesterday, latex-in-bulk rose 12 sen to close at RM8.42 a kg at the Malaysian Rubber Exchange.
Rising rubber prices bode well for rubber tappers.
Rural and Regional Development Minister Datuk Seri Shafie Apdal had reportedly said that with rubber prices at an all-time high, smallholders were reaping a monthly gross income of RM4,000.
Thai acknowledged rubber tappers' good fortune and noted manufacturers' extra security measures in securing latex supply.
"At current pricing, our daily supply of four tankers of latex is worth RM1 million on the road. Latex is very precious. These tankers are fully-insured against hijacks," he told reporters in Kuala Lumpur yesterday.
Asked if latex supply is somewhat hampered by floods in southern Thailand, he said: "The flood might have affected dry rubber supply at low-lying warehouses but there's no supply disruption for wet latex as these are stored in raised tankers."
Thai revealed that costlier natural rubber latex had prompted many rubber glovemakers to switch a bigger portion of their production lines to make synthetic rubber gloves.
Thai said Supermax will churn out more powder-free nitrile gloves.
"Nitrile gloves used to make up a quarter of our total output. We're raising it to be a third," he said.
On fuel supply, Thai said rubber glovemakers had, again, appealed to the government to allocate more natural gas quota to them.
"We recently met with Pemandu (Performance Management & Delivery Unit) for the National Key Economic Area on rubber sector and highlighted some infrastructure gaps. The industry needs another 100 million mmBtu/hourof natural gas," he added.
Read more: Prices set to rise as glove makers protect profit margin http://www.btimes.com.my/Current_News/BTIMES/articles/rub09/Article/#ixzz14tQpZDua
----
Hartalega gains on Q2 net income jump
Published: 2010/11/10
Hartalega Holdings Bhd, a Malaysian rubber-glove maker, rose to its highest level in more than three months in Kuala Lumpur trading after posting a 49 per cent jump in second-quarter net income.
Its shares gained 1.3 per cent to RM5.60 at 9:10 a.m. local time, set for their highest close since July 19. -- Bloomberg
Read more: Hartalega gains on Q2 net income jump http://www.btimes.com.my/Current_News/BTIMES/articles/20101110092520/Article/index_html#ixzz14tRxFudG
----
Latexx Q3 profit rises 41.3pc
Published: 2010/11/10
Latexx Partners Bhd's pre-tax profit rose 41.3 per cent to RM20.17 million for the third quarter ended Sept 30, 2010 from RM14.28 million in the same quarter last year.
Its revenue jumped 60.7 per cent to RM129.88 million from RM80.84 million previously.
For the first nine months ended Sept 30, 2010, Latexx''s pre-tax profit surged 93.9 per cent to RM67.53 million from RM34.83 million in the same period of 2009.
The company's revenue increased 73.1 per cent to RM390.53 million from RM225.59 million previously. - Bernama
Read more: Latexx Q3 profit rises 41.3pc http://www.btimes.com.my/Current_News/BTIMES/articles/20101110170400/Article/index_html#ixzz14tSABzaC
By Ooi Tee Ching
Published: 2010/11/10
THE average selling price of rubber gloves, at US$30 (RM93) per 1,000 pieces, is set to trend higher because manufacturers need to protect profit margin, Supermax Corp said.
"We are quoting selling prices more frequently. We do it on a weekly basis to better match the volatile currency movement and rising raw material costs. We need to preserve our profit margin," said executive chairman and group managing director Datuk Seri Stanley Thai.
In the recent quarterly reporting season of March to June, many rubber glove manufacturers suffered lower earnings from slower than expected cost pass-through of rising latex prices and weakening US dollar.
Yesterday, latex-in-bulk rose 12 sen to close at RM8.42 a kg at the Malaysian Rubber Exchange.
Rising rubber prices bode well for rubber tappers.
Rural and Regional Development Minister Datuk Seri Shafie Apdal had reportedly said that with rubber prices at an all-time high, smallholders were reaping a monthly gross income of RM4,000.
Thai acknowledged rubber tappers' good fortune and noted manufacturers' extra security measures in securing latex supply.
"At current pricing, our daily supply of four tankers of latex is worth RM1 million on the road. Latex is very precious. These tankers are fully-insured against hijacks," he told reporters in Kuala Lumpur yesterday.
Asked if latex supply is somewhat hampered by floods in southern Thailand, he said: "The flood might have affected dry rubber supply at low-lying warehouses but there's no supply disruption for wet latex as these are stored in raised tankers."
Thai revealed that costlier natural rubber latex had prompted many rubber glovemakers to switch a bigger portion of their production lines to make synthetic rubber gloves.
Thai said Supermax will churn out more powder-free nitrile gloves.
"Nitrile gloves used to make up a quarter of our total output. We're raising it to be a third," he said.
On fuel supply, Thai said rubber glovemakers had, again, appealed to the government to allocate more natural gas quota to them.
"We recently met with Pemandu (Performance Management & Delivery Unit) for the National Key Economic Area on rubber sector and highlighted some infrastructure gaps. The industry needs another 100 million mmBtu/hourof natural gas," he added.
Read more: Prices set to rise as glove makers protect profit margin http://www.btimes.com.my/Current_News/BTIMES/articles/rub09/Article/#ixzz14tQpZDua
----
Hartalega gains on Q2 net income jump
Published: 2010/11/10
Hartalega Holdings Bhd, a Malaysian rubber-glove maker, rose to its highest level in more than three months in Kuala Lumpur trading after posting a 49 per cent jump in second-quarter net income.
Its shares gained 1.3 per cent to RM5.60 at 9:10 a.m. local time, set for their highest close since July 19. -- Bloomberg
Read more: Hartalega gains on Q2 net income jump http://www.btimes.com.my/Current_News/BTIMES/articles/20101110092520/Article/index_html#ixzz14tRxFudG
----
Latexx Q3 profit rises 41.3pc
Published: 2010/11/10
Latexx Partners Bhd's pre-tax profit rose 41.3 per cent to RM20.17 million for the third quarter ended Sept 30, 2010 from RM14.28 million in the same quarter last year.
Its revenue jumped 60.7 per cent to RM129.88 million from RM80.84 million previously.
For the first nine months ended Sept 30, 2010, Latexx''s pre-tax profit surged 93.9 per cent to RM67.53 million from RM34.83 million in the same period of 2009.
The company's revenue increased 73.1 per cent to RM390.53 million from RM225.59 million previously. - Bernama
Read more: Latexx Q3 profit rises 41.3pc http://www.btimes.com.my/Current_News/BTIMES/articles/20101110170400/Article/index_html#ixzz14tSABzaC
Latexx
Date announced 10-Nov-10
Quarter 30/09/2010 Qtr 3
FYE 31/12/2010
STOCK LATEXX
C0DE 7064
Price $ 2.78
Curr. PE (ttm-Eps) 7.32 Curr. DY 0.72%
LFY Div 2.00 DPO ratio 7%
ROE 35.5% PBT Margin 15.5% PAT Margin 13.6%
Rec. qRev 129878 q-q % chg -3% y-y% chq 61%
Rec qPbt 20168 q-q % chg -16% y-y% chq 41%
Rec. qEps 8.19 q-q % chg -21% y-y% chq 12%
ttm-Eps 37.96 q-q % chg 2% y-y% chq 76%
Using VERY CONSERVATIVE ESTIMATES:
EPS GR 5%
Avg.H PE 8.00
Avg. L PE 6.00
Forecast High Pr 3.88 Forecast Low Pr 2.40 Recent Severe Low Pr 2.40
Current price is at Lower 1/3 of valuation zone.
RISK: Upside 74% Downside 26%
One Year Appreciation Potential 8% Avg. yield 1%
Avg. Total Annual Potential Return (over next 5 years) 9%
CPE/SPE 1.05
P/NTA 2.60
NTA 1.07
SPE 7.00
Rational Pr 2.66
Decision:
Already Owned: Buy Hold Sell Filed Review (future acq): Filed Discard: Filed
Guide: Valuation zones Lower 1/3 Buy Mid. 1/3 Maybe Upper 1/3 Sell
Aim:
To Buy a bargain: Buy at Lower 1/3 of Valuation Zone
To Minimise risk of Loss: Buy when risk is low i.e UPSIDE GAIN > 75% OR DOWNSIDE RISK <25%
To Double every 5 years: Seek for POTENTIAL RETURN of > 15%/yr.
To Prevent Loss: Sell immediately when fundamentals deteriorate
To Maximise Gain & Reduce Loss: Sell when CPE/SPE > 1.5, when in Upper 1/3 of Valuation Zone & Returns < 15%/yr
Wednesday 3 November 2010
LATEXX
Date announced 6/8/2010
Quarter 30/6/2010 Qtr 2
FYE 21/12/2010
STOCK LATEXX
C0DE 7064
Price $ 3.11
Curr. PE (ttm-Eps) 8.38
Curr. DY 0.64%
Rec. qRev 134483 q-q % chg 7% y-y% chq 81%
Rec qPbt 24115 q-q % chg 4% y-y% chq 111%
Rec. qEps 10.39 q-q % chg -1% y-y% chq 77%
ttm-Eps 37.10 q-q % chg 14% y-y% chq 113%
Using VERY CONSERVATIVE ESTIMATES:
EPS GR 5%
Avg.H PE 8.00
Avg. L PE 6.00
Forecast High Pr 3.79
Forecast Low Pr 2.37
Recent Severe Low Pr 2.37
Current price is at Middle 1/3 of valuation zone.
RISK: Upside 48% Downside 52%
One Year Appreciation Potential 4% Avg. yield 1% Avg.
Total Annual Potential Return (over next 5 years): 5%
CPE/SPE 1.20
P/NTA 2.99
NTA 1.04
SPE 7.00
Rational Pr 2.60
Decision:
Already Owned: Buy Hold Sell Filed
Review (future acq): Filed
Discard: Filed
Guide: Valuation zones Lower 1/3 Buy; Mid. 1/3 Maybe; Upper 1/3 Sell.
Aim:
To Buy a bargain: Buy at Lower 1/3 of Valuation Zone
To Minimise risk of Loss: Buy when risk is low i.e UPSIDE GAIN > 75% OR DOWNSIDE RISK <25%
To Double every 5 years: Seek for POTENTIAL RETURN of > 15%/yr.
To Prevent Loss: Sell immediately when fundamentals deteriorate
To Maximise Gain & Reduce Loss: Sell when CPE/SPE > 1.5, when in Upper 1/3 of Valuation Zone & Returns < 15%/yr
Monday 25 October 2010
Glovemakers upbeat despite rising costs
Glovemakers upbeat despite rising costs
Tags: Datuk Seri Stanley Thai | Hartalega Holdings Bhd | Kuan Mun Keng | Low Bok Tek | Supermax Corp Bhd
Written by Chong Jin Hun
Monday, 25 October 2010 11:45
This article appeared in The Edge Financial Daily, October 25, 2010.
Tags: Datuk Seri Stanley Thai | Hartalega Holdings Bhd | Kuan Mun Keng | Low Bok Tek | Supermax Corp Bhd
Written by Chong Jin Hun
Monday, 25 October 2010 11:45
TEFD: How is the company coping with the headwinds in the form of costlier latex and the weakening US dollar?
Hartalega executive director Kuan Mun Keng: Hartalega is primarily focused on nitrile gloves, so we are largely not affected by the impact of rising natural rubber costs. Nitrile material, which is purchased in US dollar, provides a natural hedge to our US dollar-denominated sales. Moreover, improving productivity allows us to provide better pricing support to our customers.
Latexx Partners executive chairman and chief executive Low Bok Tek:
Although not new to the glove industry, the sustained high level of latex prices is still the biggest challenge faced by glovemakers like Latexx. Thus, the company is focusing on the premium products segment that is relatively more resilient, for example the nitrile gloves segment. Through the advancing of in-house nitrile production technology and intensified marketing efforts, a thinner and more cost-effective high quality nitrile glove has been developed and introduced to the market.
The company also strategically positioned itself in the premium natural rubber (NR) gloves segment, with the launching of the first-in-the world NR powder-free gloves with unquantifiable protein level. This premium product range is currently the most effective solution to the threats of protein allergy for glove users.
In summary, we strongly believe that with the company’s ability to pass-on costs to customers, coupled with our strategies to focus on the premium segments in both nitrile and natural rubber, we are able to cope with the temporary headwinds and move on to advance our market presence.
Supermax Corps executive chairman and group managing director Datuk Seri Stanley Thai: Volatility in commodity prices and foreign exchange are not new to us. They are part of our ongoing day-to-day business that we need to monitor closely, especially when the volatility is high. All glove manufacturers adjust their product pricing. In fact, the higher the volatility, the more frequently glove manufacturers and exporters have to adjust glove prices upwards. With the current high volatility, glove makers are adjusting prices at least once or twice a month. We are also seeing that manufacturers are switching more production lines to produce synthetic nitrile gloves since the pace of price increases in nitrile latex is slower.
How has the demand for gloves been?
Kuan: During the H1N1 outbreak, every manufacturer was very bullish as demand was high and supply was tight. Recently, the World Health Organisation announced that H1N1 had moved into the post pandemic stage. However, the impact on Hartalega is reduced because users are still switching to nitrile gloves due to high natural rubber prices. Nitrile gloves are actually cheaper than natural rubber gloves now. In the absence of any health epidemic, demand will still grow due to healthcare reform, population growth and the expansion of the healthcare industry. But we are bracing ourselves for more competition as our peers are looking into or have started producing nitrile gloves.
Low: The demand growth for gloves has remained healthy although the concern for H1N1 has faded. Upon normalising, the demand for gloves still grows at 10% to 12% annually which indicates a remarkable upside for any industry. Over the years, growing hygiene awareness and increased healthcare spending have made gloves a necessity in the healthcare sector, especially, in developed economies, thus making the industry resilient even when economy is slowing down.
Thai: The demand for gloves remains strong particularly in the healthcare industry. I have found demand and consumption to be stable, as evidenced by the outbound sales of gloves from our customers’ distribution warehouses. However, due to the high volatility of foreign exchange and increasing glove prices, the majority of customers are ordering or replenishing their stocks on a just-in-time basis. There are no back orders problems now for regular glove products. We have also seen the delivery lead time reduced from 90 to 120 days at the height of the HIN1 outbreak to 45 to 60 days at present. That means it is now back to normal delivery lead time.
How will the price hike help to sustain the company’s earnings?
Kuan: Hartalega has already increased the prices of rubber gloves in accordance with the advice from The Malaysian Rubber Glove Manufacturers’ Association (Margma) and the rising costs of natural latex. As for nitrile, prices have remained the same over this period. Our earnings are sustainable because customers continue to switch from natural rubber to nitrile gloves.
Low: Latexx has increased its glove prices in accordance with rising raw material costs and the weak US dollar. Latexx has a mechanism to adjust its prices to pass on the higher latex costs and weakening exchange rates of US dollars to the customers, otherwise we would have to bear the cost. The customers understand the situation.
Thai: Supermax has increased glove prices in tandem with the increase in latex prices and the soft US dollar. However, margins will be squeezed due to the time lag in executing the orders. Supermax remains confident of meeting the FY10 profit guidance of at least RM168 million in profit after tax. We have taken into account of the strong ringgit and higher latex prices.
Hartalega executive director Kuan Mun Keng: Hartalega is primarily focused on nitrile gloves, so we are largely not affected by the impact of rising natural rubber costs. Nitrile material, which is purchased in US dollar, provides a natural hedge to our US dollar-denominated sales. Moreover, improving productivity allows us to provide better pricing support to our customers.
Latexx Partners executive chairman and chief executive Low Bok Tek:
Although not new to the glove industry, the sustained high level of latex prices is still the biggest challenge faced by glovemakers like Latexx. Thus, the company is focusing on the premium products segment that is relatively more resilient, for example the nitrile gloves segment. Through the advancing of in-house nitrile production technology and intensified marketing efforts, a thinner and more cost-effective high quality nitrile glove has been developed and introduced to the market.
The company also strategically positioned itself in the premium natural rubber (NR) gloves segment, with the launching of the first-in-the world NR powder-free gloves with unquantifiable protein level. This premium product range is currently the most effective solution to the threats of protein allergy for glove users.
In summary, we strongly believe that with the company’s ability to pass-on costs to customers, coupled with our strategies to focus on the premium segments in both nitrile and natural rubber, we are able to cope with the temporary headwinds and move on to advance our market presence.
Supermax Corps executive chairman and group managing director Datuk Seri Stanley Thai: Volatility in commodity prices and foreign exchange are not new to us. They are part of our ongoing day-to-day business that we need to monitor closely, especially when the volatility is high. All glove manufacturers adjust their product pricing. In fact, the higher the volatility, the more frequently glove manufacturers and exporters have to adjust glove prices upwards. With the current high volatility, glove makers are adjusting prices at least once or twice a month. We are also seeing that manufacturers are switching more production lines to produce synthetic nitrile gloves since the pace of price increases in nitrile latex is slower.
How has the demand for gloves been?
Kuan: During the H1N1 outbreak, every manufacturer was very bullish as demand was high and supply was tight. Recently, the World Health Organisation announced that H1N1 had moved into the post pandemic stage. However, the impact on Hartalega is reduced because users are still switching to nitrile gloves due to high natural rubber prices. Nitrile gloves are actually cheaper than natural rubber gloves now. In the absence of any health epidemic, demand will still grow due to healthcare reform, population growth and the expansion of the healthcare industry. But we are bracing ourselves for more competition as our peers are looking into or have started producing nitrile gloves.
Low: The demand growth for gloves has remained healthy although the concern for H1N1 has faded. Upon normalising, the demand for gloves still grows at 10% to 12% annually which indicates a remarkable upside for any industry. Over the years, growing hygiene awareness and increased healthcare spending have made gloves a necessity in the healthcare sector, especially, in developed economies, thus making the industry resilient even when economy is slowing down.
Thai: The demand for gloves remains strong particularly in the healthcare industry. I have found demand and consumption to be stable, as evidenced by the outbound sales of gloves from our customers’ distribution warehouses. However, due to the high volatility of foreign exchange and increasing glove prices, the majority of customers are ordering or replenishing their stocks on a just-in-time basis. There are no back orders problems now for regular glove products. We have also seen the delivery lead time reduced from 90 to 120 days at the height of the HIN1 outbreak to 45 to 60 days at present. That means it is now back to normal delivery lead time.
How will the price hike help to sustain the company’s earnings?
Kuan: Hartalega has already increased the prices of rubber gloves in accordance with the advice from The Malaysian Rubber Glove Manufacturers’ Association (Margma) and the rising costs of natural latex. As for nitrile, prices have remained the same over this period. Our earnings are sustainable because customers continue to switch from natural rubber to nitrile gloves.
Low: Latexx has increased its glove prices in accordance with rising raw material costs and the weak US dollar. Latexx has a mechanism to adjust its prices to pass on the higher latex costs and weakening exchange rates of US dollars to the customers, otherwise we would have to bear the cost. The customers understand the situation.
Thai: Supermax has increased glove prices in tandem with the increase in latex prices and the soft US dollar. However, margins will be squeezed due to the time lag in executing the orders. Supermax remains confident of meeting the FY10 profit guidance of at least RM168 million in profit after tax. We have taken into account of the strong ringgit and higher latex prices.
This article appeared in The Edge Financial Daily, October 25, 2010.
Thursday 21 October 2010
Association tells glove makers to up prices
Written by Surin Murugiah
Wednesday, 20 October 2010 15:16
KUALA LUMPUR: The Malaysian Rubber Glove Manufacturers’ Association (Margma), whose members collectively supply 60% of the global rubber latex glove consumption, advised its members to raise glove prices in line with high raw material costs and continued weakening of the US dollar.
This may well explain the share price surge among the rubber glove makers on Bursa Malaysia yesterday.
Top Glove Corporation Bhd rose 19 sen to RM5.68 Supermax Corporation Bhd was up 14 sen sen to RM4.65, Latexx Partners Bhd up four sen to RM2.86, and Kossan Rubber Industries Bhd gained two sen to RM2.86.
But Hartalega Holdings Bhd shed four sen to RM5.42 while Rubberex Corporation (M) Bhd lost 0.5 sen to 85.5 sen.
In a statement yesterday, Margma president KM Lee said most rubber glove manufacturers had started raising selling prices of their products to reflect the rising raw material costs and the weakening of the US dollar.
“If the orders forthcoming do not match the glove price requested, glove makers have no choice but to reduce the output,” said Lee.
Margma said the price of natural rubber latex had increased by about 19% from an average 657.25 sen/kg in January 2010 to a new record high of 782 sen/kg last Friday.
Meanwhile, the US dollar has weakened against the ringgit by around 13% compared to 12 months ago, it said.
Rubber futures contract in Shanghai hit an all-time high yesterday boosted by strong demand at a time of restricted supply in main producing countries. Concerns that rubber production in China will be affected by typhoons also lent support to the futures price.
The Shanghai rubber futures contract for March delivery hit a record 33,000 yuan (RM15,438) per tonne, up 3.8% from the previous high of 31,800 yuan per tonne marked on Oct 15.
Lee said despite the strong headwinds, the industry would remain bullish as demand for gloves was expected to grow at between 8% and 10% annually.
“We expect further growth in the industry on the back of rising healthcare awareness in emerging markets, especially in China, India and the Latin American countries.
“Comparatively, the healthcare expenditure in these regions is relatively low against what is being spent in the US, Europe and Japan,” said Lee.
Lee added that the domestic glove industry was to a large extent recession-proof and was relatively unscathed even during the recent economic downturn, mainly due to gloves being a necessity in the healthcare sector.
However, he pointed out that the glove industry was facing constant challenge with the ever-fluctuating raw material prices, particularly natural rubber latex for rubber gloves and crude oil for nitrile gloves.
The association also urged the government to be considerate in the removal of the natural gas subsidy by not overburdening an already challenging industry with a big and sudden gas price hike.
The removal of the subsidy for natural gas should be done over a period of time, it said.
The association has 46 members and 89 associate members. The ordinary membership is open to all bona fide rubber glove makers in Malaysia while others who directly involved in the trade or industry are eligible for associate membership.
This article appeared in The Edge Financial Daily, October 20, 2010.
Wednesday, 20 October 2010 15:16
KUALA LUMPUR: The Malaysian Rubber Glove Manufacturers’ Association (Margma), whose members collectively supply 60% of the global rubber latex glove consumption, advised its members to raise glove prices in line with high raw material costs and continued weakening of the US dollar.
This may well explain the share price surge among the rubber glove makers on Bursa Malaysia yesterday.
Top Glove Corporation Bhd rose 19 sen to RM5.68 Supermax Corporation Bhd was up 14 sen sen to RM4.65, Latexx Partners Bhd up four sen to RM2.86, and Kossan Rubber Industries Bhd gained two sen to RM2.86.
But Hartalega Holdings Bhd shed four sen to RM5.42 while Rubberex Corporation (M) Bhd lost 0.5 sen to 85.5 sen.
In a statement yesterday, Margma president KM Lee said most rubber glove manufacturers had started raising selling prices of their products to reflect the rising raw material costs and the weakening of the US dollar.
“If the orders forthcoming do not match the glove price requested, glove makers have no choice but to reduce the output,” said Lee.
Margma said the price of natural rubber latex had increased by about 19% from an average 657.25 sen/kg in January 2010 to a new record high of 782 sen/kg last Friday.
Meanwhile, the US dollar has weakened against the ringgit by around 13% compared to 12 months ago, it said.
Rubber futures contract in Shanghai hit an all-time high yesterday boosted by strong demand at a time of restricted supply in main producing countries. Concerns that rubber production in China will be affected by typhoons also lent support to the futures price.
The Shanghai rubber futures contract for March delivery hit a record 33,000 yuan (RM15,438) per tonne, up 3.8% from the previous high of 31,800 yuan per tonne marked on Oct 15.
Lee said despite the strong headwinds, the industry would remain bullish as demand for gloves was expected to grow at between 8% and 10% annually.
“We expect further growth in the industry on the back of rising healthcare awareness in emerging markets, especially in China, India and the Latin American countries.
“Comparatively, the healthcare expenditure in these regions is relatively low against what is being spent in the US, Europe and Japan,” said Lee.
Lee added that the domestic glove industry was to a large extent recession-proof and was relatively unscathed even during the recent economic downturn, mainly due to gloves being a necessity in the healthcare sector.
However, he pointed out that the glove industry was facing constant challenge with the ever-fluctuating raw material prices, particularly natural rubber latex for rubber gloves and crude oil for nitrile gloves.
The association also urged the government to be considerate in the removal of the natural gas subsidy by not overburdening an already challenging industry with a big and sudden gas price hike.
The removal of the subsidy for natural gas should be done over a period of time, it said.
The association has 46 members and 89 associate members. The ordinary membership is open to all bona fide rubber glove makers in Malaysia while others who directly involved in the trade or industry are eligible for associate membership.
This article appeared in The Edge Financial Daily, October 20, 2010.
Tuesday 5 October 2010
So, you like Glove Sector - Which Stock will you Pick?
Analysis of the Glove Sector.
https://spreadsheets.google.com/pub?key=0AuRRzs61sKqRdDM1ZFNXQ2ZPRHBYcFJjd1lDNFVYdFE&hl=en&output=html
The top 6 glove companies are priced at RM 8.7 billion in market capitalization. They generated a total of about RM 766 million in earnings the last 12 months.
https://spreadsheets.google.com/pub?key=0AuRRzs61sKqRdDM1ZFNXQ2ZPRHBYcFJjd1lDNFVYdFE&hl=en&output=html
The top 6 glove companies are priced at RM 8.7 billion in market capitalization. They generated a total of about RM 766 million in earnings the last 12 months.
Saturday 2 October 2010
Glove makers advance after CIMB Research maintains overweight on sector
Glove makers advance after CIMB Research maintains overweight on sector
Written by Surin Murugiah
Friday, 01 October 2010 15:29
KUALA LUMPUR: Rubber glove makers on Bursa Malaysia advanced in the afternoon session on Friday, Oct 1 after CIMB Research maintained its overweight on the sector and said that despite considerable headwinds encountered by the sector this year, demand for rubber gloves continued to grow at a healthy clip.
http://www.theedgemalaysia.com/business-news/174572-glove-makers-advance-after-cimb-research-maintains-overweight-on-sector-.html
Written by Surin Murugiah
Friday, 01 October 2010 15:29
KUALA LUMPUR: Rubber glove makers on Bursa Malaysia advanced in the afternoon session on Friday, Oct 1 after CIMB Research maintained its overweight on the sector and said that despite considerable headwinds encountered by the sector this year, demand for rubber gloves continued to grow at a healthy clip.
At 3.15pm, Supermax was up 15 sen to RM3.94, Hartalega gained 14 sen to RM4.84, Latexx rose 13 sen to RM2.57, Top Glove, Kossan and Adventa gained 10 sen each to RM5.23, RM3.07 and RM2.50, respectively, while Rubberex added three sen to 87 sen.
CIMB Research in a report on Friday said with continued technological advancement of glove products and facilities, Malaysian rubber glove manufacturers would maintain its leadership in the global market.
In light of the positive long term prospects of the industry, the research house maintained its overweight call. All the glove stocks under its coverage remain as Outperforms, said CIMB Research.
“Potential re-rating catalysts include the continuing uptick in demand from the healthcare industry, ongoing capacity expansion and strong earnings growth.
“The recent sharp pullback in share prices has made the sector even more attractive with undemanding average P/Es of 7-8 times. Supermax and Latexx remain our top picks,” it said.
In light of the positive long term prospects of the industry, the research house maintained its overweight call. All the glove stocks under its coverage remain as Outperforms, said CIMB Research.
“Potential re-rating catalysts include the continuing uptick in demand from the healthcare industry, ongoing capacity expansion and strong earnings growth.
“The recent sharp pullback in share prices has made the sector even more attractive with undemanding average P/Es of 7-8 times. Supermax and Latexx remain our top picks,” it said.
http://www.theedgemalaysia.com/business-news/174572-glove-makers-advance-after-cimb-research-maintains-overweight-on-sector-.html
Friday 1 October 2010
Thursday 2 September 2010
Nine Malaysian firms on Forbes’ ‘best under a billion’ list
Nine Malaysian firms on Forbes’ ‘best under a billion’ list
September 02, 2010
KUALA LUMPUR, Sept 2 — Nine Malaysian companies have made it to Forbes magazine’s ranking of best performing listed Asian companies with revenues under US$1 billion (RM3.1 billion).
Malaysia tied with Thailand for the sixth most number of entries on the list after China/Hong Kong with 71, India (39), South Korea (20), Taiwan (19) and Australia (13).
Singapore had eight entries on the list while Japan had two, down from 24 due to domestic economic woes.
“In aggregate the market-cap-weighted shares of our 2010 class were up 43 per cent over 12 months versus 21 per cent for the FTSE Asia Pacific Small Cap stock index,” said Forbes.
The nine Malaysian entries this year represented an increase of one over the eight entries it had on the list last year.
One Malaysian newcomer to the list, glove maker Hartalega Holdings, was profiled by the magazine.The other companies were RFID solutions provider CBS Technology, marine services provider Coastal Contracts, herbal care multi-level marketing company Hai-O Enterprise, steel pipe maker KKB Engineering, glove maker Latexx Partners, construction company Mudajaya Group, e-government service provider My EG Services and IT firm Willowglen MSC.
The Singaporean entries were real estate fund manager ARA Asset Management, marine equipment manufacturer Baker Technology, furniture maker Design Studio Furniture, engineering outfit Hiap Seng Engineering, property developer Ho Bee Investment, infrastructure builder OKP Holdings, clean room supplier Riverstone Holdings and mining company Straits Asia Resources.
This year also marked the first time a Vietnamese company made it to the list — dairy outfit Vinamilk.
“Its history reflects the different nature of enterprises in nations with long-standing state dominance,” said Forbes.
The annual “Best Under A Billion” list picks the top-performing 200 firms from close to 13,000 listed Asia-Pacific companies with actively traded shares and sales of between US$5 million and US$1 billion.
Selection of the final 200 was based on earnings growth, sales growth, and shareholders’ return on equity in the past 12 months and over three years.
Prime Minister Datuk Seri Najib Razak said recently that small-medium enterprises (SMEs) are the backbone of the Malaysian economy.
SMEs contribute about one-third of Malaysia’s GDP and account for 20 per cent of its exports.
http://www.themalaysianinsider.com/business/article/nine-malaysian-firms-on-forbes-best-under-a-billion-list/
Friday 6 August 2010
Latexx 2Q net profit surges 89% to RM21.55m
Latexx 2Q net profit surges 89% to RM21.55m
Tags: Latexx Partners Bhd
Written by Surin Murugiah
Friday, 06 August 2010 13:20
KUALA LUMPUR: LATEXX PARTNERS BHD [] net profit for the second quarter ended June 30, 2010 surged 88.9% to RM21.55 million from RM11.41 million a year ago on the back of a 80.7% jump in revenue to RM134.48 million.
The company declared a second interim tax exempt dividend of 2.5 sen per ordinary share of 50 sen each. Earnings per share was 10.39 sen while net assets per share was RM1.04.
In a filing to Bursa Malaysia Securities on Friday, Aug 6, Latexx attributed the increase in revenue and profit to its recent capacity expansion and fine tuning of glove production lines coupled with aggressive marketing strategy as well as overall cost savings.
The company said it was confident that the growth in FY 2010 would be sustained 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 by penetrating into new markets will contribute to sustainable profitability, it said.
http://www.theedgemalaysia.com/business-news/171384-latexx-2q-net-profit-surges-89-to-rm2155m.html
Bullbear Stock Investing Notes
Tags: Latexx Partners Bhd
Written by Surin Murugiah
Friday, 06 August 2010 13:20
KUALA LUMPUR: LATEXX PARTNERS BHD [] net profit for the second quarter ended June 30, 2010 surged 88.9% to RM21.55 million from RM11.41 million a year ago on the back of a 80.7% jump in revenue to RM134.48 million.
The company declared a second interim tax exempt dividend of 2.5 sen per ordinary share of 50 sen each. Earnings per share was 10.39 sen while net assets per share was RM1.04.
In a filing to Bursa Malaysia Securities on Friday, Aug 6, Latexx attributed the increase in revenue and profit to its recent capacity expansion and fine tuning of glove production lines coupled with aggressive marketing strategy as well as overall cost savings.
The company said it was confident that the growth in FY 2010 would be sustained 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 by penetrating into new markets will contribute to sustainable profitability, it said.
http://www.theedgemalaysia.com/business-news/171384-latexx-2q-net-profit-surges-89-to-rm2155m.html
Bullbear Stock Investing Notes
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