The impact on demand for rubber gloves and the contraction in the average selling price market made Supermax Corporation Bhd's net profit record decline.
Examining Supermax Corporation Bhd's quarterly earnings report for the 4th quarter (Q4) ending June 2022,
Annual net profit declined to RM732 million from RM3.82.
On a quarterly scale, net profit fell by RM33.05 million compared to RM962.53 million.
Annual revenue fell to RM2.69 billion from RM7.16 billion.
Revenue on a quarterly scale was down RM300.23 million compared to RM1.87 billion.
The company underlined that the decline occurred as a result of the fall in demand and sales prices after the world began to shift to the endemic phase of the Covid-19 epidemic this year.
In addition, the issue of suspension of orders and shipments from the Canadian government as well as a delayed release order imposed by the United States (US) Customs and Border Protection affected the company's sales.
Also cited were the factors of inventory sales by importers and overseas distribution units of Supermax while the market was shrinking and the increase in the minimum wage contributed to pressure on the decline in performance.
In the meantime, the company in its official statement said the market will remain weak and competition will be fierce and profit margins will continue to moderate with continued large consolidation in the rubber glove industry.
Nevertheless, the structural shift triggered by the pandemic will see demand remain competitive compared to the pre-pandemic period and continue the long-term upward trend.
As of this writing, Supermax shares are trading down 1.29% at 76 sen with a market capitalization of RM2.09 billion.
