The Bank of Russia unexpectedly maintained its key interest rate at a record-high 21% , defying analysts’ expectations of another significant hike as inflation remains stubbornly elevated. The decision marks a shift toward a more measured approach in balancing economic growth and price stability. Key Details Inflation Concerns: Annual inflation climbed to 8.9% in November, well above the central bank’s 4% target , with inflation expectations reaching 13.9% in December. Policy Rationale: The central bank cited the significant tightening of monetary conditions after October’s 200-basis point hike as sufficient to resume disinflationary processes. Governor Elvira Nabiullina emphasized avoiding both economic overheating and severe slowdowns. Economic Overheating: Elevated government spending on the war in Ukraine and social programs, coupled with labor shortages and rising wages, have fueled strong domestic demand, exacerbating price pressures...
Top Glove Corp Bhd reported a net profit of RM5.47 million for its first quarter ended Nov 30, 2024 (1QFY2025), marking a turnaround from a net loss of RM57.71 million in the same quarter a year ago. The improved performance was attributed to higher sales volumes, foreign exchange gains, and increased US orders ahead of tariffs on Chinese glove imports.
Key Highlights
Financial Performance
- Net Profit: RM5.47 million in 1QFY2025 vs. a net loss of RM57.71 million in 1QFY2024.
- Revenue: RM885.89 million, up 79.5% from RM493.46 million in 1QFY2024.
- Quarter-on-Quarter (QoQ): Improved from a net loss of RM3.57 million in 4QFY2024, with revenue growing 6.1% from RM835.31 million.
- Earnings Per Share (EPS): 0.07 sen in 1QFY2025, compared to a loss per share of 0.04 sen in 4QFY2024.
Operational Highlights
- Plant Utilisation Rate: 66% in 1QFY2025.
- Selling Price Increases: Average selling price (ASP) hikes in August and September began impacting revenue towards the end of 1QFY2025, with the full effect expected in 2QFY2025.
- US Tariffs: Increased US orders were driven by the impending 50% tariff on Chinese glove imports, benefiting Top Glove through trade diversion.
Growth Strategy and Outlook
- Recovery in the Glove Industry: The company anticipates continued recovery supported by shifting trade dynamics.
- Risk Diversification: Plans to spread operations across Malaysia, Thailand, and Vietnam to manage geopolitical risks.
- Optimistic Outlook for 2QFY2025: Expecting stronger impact from tariffs on Chinese gloves and continued order inflows.
- Managing Director Lim Cheong Guan: "We are highly encouraged by the steady inflow of orders and opportunities arising from global trade shifts. These trends position us well for accelerated growth."
Bonus Warrants Proposal
- Proposed 1-for-20 bonus warrants:
- Exercise Price: RM1.27 in Malaysia and SG$0.38 in Singapore.
- Subject to shareholder approval at the upcoming AGM on Jan 15, 2025.
Market Performance
- Share Price:
- Malaysia: Down 2 sen (1.4%) to RM1.38 at midday, giving a market cap of RM11.33 billion.
- Singapore: Trading at 42 Singapore cents, down half a sen.
- Year-to-Date Performance: Shares have gained 53%.
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