Sri Trang Gloves Thailand (STGT), the world’s leading rubber glove producer, gained 3.14 per cent to baht 41.00 per share Wednesday’s morning after it reported all-time-high profits in the fourth-quarter operations of 8.5 billion baht, exceeding expectations.
As demand for rubber gloves continues to surge, STGT is seeing a sustained increase in profits from the global Covid-19 outbreak. Its fourth-quarter net profit was 93.6 per cent up from the previous quarter and 4,600 per cent from the fourth quarter of 2019. The results exceeded analysts’ estimate of 7-8 billion baht.
The glove maker posted full-year net profit of 14.4 billion baht, soaring 2,170 per cent from 2019 on the back of unprecedented demand to deal with the pandemic. The board of directors announced a dividend payment of 2.00 baht per share to be paid on April 28.
“The current Covid-19 pandemic has led to a structural shift in consumption of gloves, which have become essential in the so-called New Normal,” the company said in the statement.
STGT mentioned that a robust growth in demand and the limited production capacity and scarcity of raw materials had driven prices further. It recorded sales of 28 billion pieces in 2020 distributing to 140 countries worldwide with a revenue of more than 30 billion baht.
The order backlog has extended to 13 months for natural rubber gloves and 30 months for synthetic rubber gloves. The company is planning to expand capacity at the plants in Surat Thani and Songkla in 2021.
The annual production capacity will reach 50 billion pieces by the end of 2022, representing a 54.5-per-cent growth from 2020, according to the statement.
“We remain committed to an expansion plan to achieve 80 billion pieces in annual installed production capacity by 2024,” said the glove maker.
The shares’ transaction value stood at 1.61 billion baht with a slight drop in price to 40.25 baht at the end of the session when the market paused for lunch. STGT price rose 3.25 per cent when the market closed on Tuesday as investors were anticipating the impressive financial performance.
Its parent firm Sri Trang Agro (STA) also reported net profit in 2020 fourth quarter of 5.5 billion baht, contributing to the full-year record of 9.5 million baht. The share price was at 33.50 baht per share as of 11.49 am, rising 1.52 per cent, with a transaction value of 753 million baht.