MALAYSIA: Top Glove to invest RM180 million as capex to expand

"In term of sales volume and sales revenue, our target should be more than 10 %,” he told reporters at a briefing on the company's first quarter financial year 2014 results.

For the first quarter, Top Glove's pre-tax profit fell to RM61.84 million from RM70.38 million previously while revenue declined to RM574 million from RM584.5 earlier mainly due to the scaling down of a production plant in China.

Apart from expanding capacity, Lim said the company was also emphasising on efficiency improvement to mitigate the increase in cost with the implementation of automation.

He said the automation of production helped to reduce labour cost by 30 % and would partly offset the increase in electricity cost due to the recent tariff hike.

The company's electricity cost rose five times to 16 % of the overall operating cost from three % previously, he said.

As a direct result, he said Top Glove had increased its sales price by between one and two % for every carton of 1,000 gloves, effective 1 Jan. 2014.

Meanwhile, in another development, Lim expected Top Glove's RM120 million tower in Setia Alam, Shah Alam, to be completed this year.

He said the tower, which consists of 14 floors of offices, two floors of retail and seven floors of car park spaces, is a long-term investment by the company to diversify its activities from the core business of glove manufacturing.

Source: "Bernama" (Malaysian National News Agency), Kuala Lumpur; 7 Jan 2014
(Syed Rasid Ali, Karachi, Pakistan)