The world’s biggest rubber glove maker Top Glove warns about delivery delays and lower sales after it shut plants in the Klang area in Malaysia due to the COVID-19 pandemic. The Health Ministry said it tested 5,777 people in Klang and found 4,036 of them were infected, making the largest coronavirus cluster in Malaysia since the pandemic started. The ministry did not disclose how many of them were Top Glove employees.
Top Glove said some deliveries might be delayed by four weeks, while new orders could take longer than usual. The company also forecast sales could fall to 3% below its projection for the current financial years. Analysts said the closure could hit the company’s net income by 2%-4%. Top Glove shares had surged this year as the pandemic boosted global demand for rubber gloves. However, it fell by 7.5% on Tuesday.
The government has said it would shut 28 of Top Glove’s buildings in the area. The company confirmed it had shut 16 of them and reduced capacity at the remaining 12. Top Glove, however, did not disclose how many production facilities were affected by the closure. The company employs 16,000 factory workers at 47 factories in Malaysia, China, Thailand, and Vietnam.
Malaysia accounts for roughly two-thirds of the world’s rubber gloves production, and Top Glove closure will likely create a shortage. At the same time, other major Malaysian rubber gloves makers such as Hartalega Holdings and Supermax Corp are already running at their full capacity.
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Published on November 25, 2020 11:23 AM (GMT+8)Last Updated on November 25, 2020 11:23 AM (GMT+8)
