Riverstone Holdings reports 49 per cent rise in net profit for Q3FY21

GLOVE-MAKER Riverstone Holdings chalked up a near 50 per cent jump year-on-year in net profit to RM266.4 million (S$86.4 million) for the third quarter ended Sep 30, 2021.

Revenue rose about 35 per cent to RM652.8 million, on the back of demand for its healthcare examination gloves amid the pandemic as well as for its high-tech cleanroom gloves from firms in the electronics and semiconductor industries. Still, market prices have started to normalise as major distributors adopt a wait-and-see stance, Riverstone flagged.

Gross profit increased 42 per cent to RM357.2 million as the average selling price was higher than prior to the pandemic, while the group chalked up a blended gross profit margin of 54.7 per cent for the quarter under review.

As at Sep 30, 2021, Riverstone had cash and cash equivalents of RM1.76 billion, up from RM648.9 million as at end December 2020.

The group has seen temporary delays in relation to Phase 7 of its expansion efforts as Malaysia's movement control order (MCO) to contain the pandemic disrupted construction and other works. Therefore, the added capacity of 1.5 billion gloves is now expected to come onstream in Q1 2022.

Preparations are also in the works for Phase 8 of its expansion plans, which will add up to 1.5 billion gloves and take its total annual production capacity to 13.5 billion by FY2022/2023.

Chief executive Wong Teek Son acknowledged near-term challenges but added that the glove-maker is eyeing longer-term prospects to achieve sustainable growth.

He said: "For one, our differentiated business model driven by our industry leading cleanroom glove business will provide the necessary support as we navigate the evolving healthcare glove market. We will also continue our focus on developing new and innovating products to diversify our income streams by capturing new market segments, namely in food processing, pharmaceutical as well as surgical glove segments to fuel growth."

The counter closed at 78 Singapore cents, down 2 cents or 2.5 per cent, on Tuesday (Nov 9).