[SINGAPORE] Gloves maker Riverstone Holdings posted a 37.4 per cent year on year drop in net profit to RM45.4 million (S$13.8 million) for the quarter ended June from RM72.5 million as higher cost of sales eroded margin.
In a regulatory filing published on Thursday (Aug 7), the Malaysia-based, Singapore-listed manufacturer of cleanroom and healthcare globes posted a marginal decrease of 0.8 per cent in revenue to RM244.8 million.
Cost of sales surged 21.3 per cent in the second quarter of FY2025.
Hence, earnings per share of 3.06 sen for the period was lower than 4.89 sen for the year-ago period.
Riverstone Holdings half-year earnings slid 29.6 per cent to RM101.8 million from RM144.7 million, even though revenue inched up 0.1 per cent to RM497.1 million from RM496.4 million.
Margin reduction was due to a depreciated greenback against the Malaysian currency (that resulted in foreign exchange translation losses), the product mix shift towards generic healthcare gloves (that have lower margin) as well as full depreciation costs from new capacity that remained idle due to domestic gas supply disruptions.
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Riverstone Holdings is recommending an interim dividend of 2.5 sen per share for the quarter, down from 4 sen for the year-ago period. It was a cumulative dividend payout of 80 per cent for the half year.
Net asset value per share was RM0.98 as at end-June, lower than RM1.06 as at end-December 2024.
Chief executive Wong Teek Son said that in spite of intensifying competition, demand for generic healthcare gloves is stable, and this volume-driven segment is expected to help offset higher depreciation costs associated with the commissioning of new production facilities.
Cleanroom glove contribution is expected to rise in the second half of the year, underpinned by rising demand from artificial intelligence industries and data centres, he said.
Riverstone Holdings shares were up 2.1 per cent or S$0.015 at S$0.725 on Thursday, before the financial results were published.
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