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PETALING JAYA: Top Glove Corp Bhd
It does not expect order cancellations from its customers as a result of delays in delivery due to its reduced operations.
The group has informed its customers that some deliveries from its plants in Klang, Selangor would be delayed for two to four weeks.
According to Top Glove CEO Tan Sri Lim Wee Chai, if orders are canceled, it will be “a very small amount.”
“Our customers know that we can quickly overcome this challenge. We still have other manufacturing facilities in Vietnam and Thailand, and we will prioritize deliveries for our customers who are on the essential services line, ”he said yesterday at a virtual press conference.
Lim added that the group was unlikely to outsource its orders as other glove factories are also seeing good demand.
Top Glove’s facility in Meru, Klang is affected by the two-week Enhanced Motion Control Order (EMCO), which began last Tuesday.
The temporary halt to operations was to facilitate Covid-19 screenings for all of its workers on site.
The temporary closure is expected to result in a 3% reduction in Top Glove sales for the financial year ending August 31, 2021.
“To date, around 7,000 of Top Glove’s employees, both local and foreign, have been tested for Covid-19,
“Based on the figure, an estimated 3,000 employees have tested positive,” said Lim, who expected the EMCO at the group’s facility to run for two to three weeks.
This is because other large facilities have observed EMCO for a week or two.
Top Glove has a total workforce of about 21,000 employees, of which 11,000 are foreign workers.
Approximately 500 of Top Glove workers have been discharged from the hospital
After that, the 500 workers have been isolated in designated hotels for the required number of days.
On the company’s recent share buyback exercise, he said it was a good recommendation from management to buy the shares.
The group’s net cash position is RM2bil, after spending an estimated RM1bil on share buybacks over the past three months.
“We estimate that Top Glove’s dividend yield will be more than 6% in the current financial year as the company is expected to perform well in line with demand for rubber gloves.
Top Glove closed yesterday at 15 sen or 2.2% lower at RM6.65.
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