Growing Global - - PowerPoint PPT Presentation

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Growing Global - - PowerPoint PPT Presentation

Dec 23, 2023 98 likes •329 views

Growing Global .. Innovation Quality 1 About us

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Growing Global

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About us

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Contents

Financial Performance & Dividend Growth Industry Outlook Hartalega NGC Status Antimicrobial Gloves What’s Next for Hartalega

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Financial Performance & Dividend Growth

High growth glove company

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Sales Revenue & Profit

110 160 240 282 443 572 735 921 1,032 1,107 1,145 1,498 1,822 2,405 2,827

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19

Revenue (RM mil) 13 19 37 40 85 146 190 201 234 234 210 259 283 439 454

FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19

Profit After Tax (RM mil)

Revenue

17.5%

YoY Increase

Profit After Tax

3.4%

YoY Increase

FY19 Net Profit Margin

16.0%

Revenue CAGR

26.1%

FY05-FY19

PAT CAGR

28.8%

FY05-FY19

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EPS Growth

2.662.90 4.91 6.546.91 7.977.85 6.74 7.85 8.62 13.28 13.69 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 Earnings per Share (sen)

EPS

3.0%

YoY Increase

EPS CAGR

16.0%

FY08-FY19

Net Earnings grew from RM40m (2008) to RM454m (2019) or 11.3 times in 11 years Number of shares grew from 243m shares (2008) to 3,345m shares (2019) as a result of bonus issue of 1 for 2 in 2010, bonus issue of 1 for 1 in 2012, bonus issue of 1 for 1 in 2015 & bonus issue of 1 for 1 in March 2018 which did not hinder EPS from growing Focus

  • n

sustaining EPS via combination

  • f

economies of scale and stable margins

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Hartalega’s Dividend Growth

Dividend per share is stated post-bonus issue*

1.00 1.67 2.63 3.13 3.63 3.63 3.25 4.00 4.25 7.95 8.20 34.4% 33.9% 40.1% 45.3% 45.7% 47.0% 49.9% 50.9% 49.3% 60.0% 60.2% FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 DPS (sen) Payout Ratio

Dividend Per Share

8.2sen

For FY2019

Dividend Payout Ratio

60.0%

From FY2018 onwards

Pay-out Policy of minimum 60% instituted from FY2018 onwards Although number of shares have grown, DPS has grown to 8.20 sen to date Total dividend payout for the year amounts to RM274 million

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Quarterly Profit

63 56 96 125 94 60 71 113 120 73 66 113 119 62 89 116 91 FY16 FY17 FY18 FY19 FY20 Q1 Q2 Q3 Q4

1Q20 vs 1Q19 PAT

24.6%

YoY Decrease

1Q20 vs 4Q19 PAT

3.1%

QoQ Increase

Lower profit YoY mainly due to lower sales volume coupled with higher packaging, heating and labour cost. During the quarter, we have completed commissioning of NGC Plant 5.

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Malaysia Rubber Glove Exports: Jan-Apr (4M18 vs 4M19)

27,154 26,423 Total Gloves

Rubber Gloves Export (million pairs)

4M2018 4M2019 9,998 17,156 9,802 16,621 Natural Rubber Nitrile

Rubber Gloves Export by Material Type (million pairs)

4M2018 4M2019

  • 2.7%
  • 2.0%
  • 3.1%

Total rubber glove exports have decreased by 2.7% YoY in the first 4 months of 2019 Natural rubber glove exports have decreased by 2.0% in the same period YoY Nitrile glove exports have also decreased by 3.1% in the same period YoY

Source: MREPC

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Malaysia Rubber Glove Exports: Jan-Dec (2017 vs 2018)

73,195 81,801 Total Gloves

Rubber Gloves Export (million pairs)

2017 2018 28,916 44,279 30,562 51,239 Natural Rubber Nitrile

Rubber Gloves Export by Material Type (million pairs)

2017 2018

11.8% 5.7% 15.7%

Total rubber glove exports have grown by 11.8% from 2017 mainly due to the China vinyl supply disruption since 2017 Nitrile exports have grown by 15.7% from 2017 as global demand continue to switch from latex to nitrile gloves

Source: MREPC

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Managing the Challenges Ahead

Continue to focus

  • n

cost

  • ptimization

initiatives to mitigate impact from rising

  • perational costs i.e. natural gas and labour cost

Further R&D efforts into innovative products to fulfill demand gaps and differentiate from competitors Continuous improvement

  • n

process automation to improve efficiency and reduce dependency on manual labour Make headway and build foothold in high growth and highly populated markets

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Industry Outlook

Long term potential from developing markets

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Consistent growth in global consumption

Market outlook

64 68 84 92 94 102110122124 140150148160171180194 210 228 256

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019f

Global demand grew at a rate of

8%-10%

per annum for the past 10 years

Malaysia is the largest supplier

63%

Market Share

In the past 5 years, market continues to grow at a rate of 8%, fueled by increasing demand in regions such as Europe & Asia.

Source: Trade Atlas import data, Company estimates

?

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Malaysia’s Export of Rubber Gloves (source MREPC)

Market outlook

Nitrile glove export in Malaysia continues to grow

NR 42% NBR, 58% NR, 49% NBR, 51% NR, 43% NBR, 57% NR, 40% NBR, 60%

Year 2014 Year 2015 Year 2016 Year 2017 Year 2018

NR, 37% NBR, 63%

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Hartalega NGC Status

Next generation integrated manufacturing complex

NGC

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NGC ongoing expansion

To date, 60 production lines are running at NGC. 5 out of 6 plants at NGC are in full operation Plant 6 is targeted to start production in 1Q of 2020 while plant 7 in 2H 2020 Have set aside capital expenditure of RM630mil for the next 3 years for plant expansion Capacity will increase from current 34 billion pcs p.a. to 42 billion pcs p.a. by FY2022

RM1.8bln

Invested at NGC to date

P6 P7

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production lines to be built in NGC in coming years

2.4 times

Revenue more than doubled in 4 years

FY15 FY19

1.1bln 2.8bln

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Antimicrobial Gloves

World’s First Non-Leaching Antimicrobial Gloves

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World’s first non-leaching antimicrobial gloves

Update on AMG

We changed the global landscape of gloves with our world’s first light weight nitrile gloves Our antimicrobial glove will be the next game changer, creating a new standard of gloves To date we have shipped to 20 countries Expect to obtain FDA approval by 2H 2020

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What’s next for Hartalega

Charting the path ahead

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What’s next for Hartalega

Plans beyond NGC

Beyond plant 7, we will continue our expansion mainly in Malaysia With the plans in place, we are looking at the average 10% p.a. growth in capacity for the next 3 years, however we remain cognisant

  • f

market demand to maintain a healthy supply-demand balance

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What’s next for Hartalega

Production technology

Robotic auto packing system that replaces the manual process of inserting a stack of gloves into a box Installation

  • f

Digital Imaging System into

  • ur

production lines to inspect every piece

  • f

glove, defective ones will be rejected by the system The first and

  • nly

glove company with a fully integrated ERP system First glove company with a Manufacturing Execution System (MES). It is an in-house built IT based system for traceability of the products produced in all our plants Production lines are all IoT ready

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Do you have any question?

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