KUALA LUMPUR, July 26 — Kossan Rubber Industries Bhd (Kossan) registered a lower net profit of RM45.99 million in the second quarter ended June 30, 2022 (Q2FY2022) versus RM1.06 billion a year earlier.
This was in tandem with its lower revenue of RM589.86 million against RM2.24 billion a year ago as a result of the decrease in revenue from the gloves, technical rubber products and clean-room divisions.
In a filing with Bursa Malaysia today, Kossan said the glove industry will be confronted with an oversupply situation as a result of overstocking and subsequent inventory adjustments from customers, forcing average selling price to fall.
For the technical rubber products division, it said the anticipated gradual uptick in economic activities and infrastructure spending globally will continue to spur the infrastructure and automotive segments with the group expecting this division to deliver a satisfactory performance in the second half of FY2022.
Due to the headwinds affecting the glove sector, the group expects the performance in the second half of FY22 to be challenging.
“As such, the group will place its near-term expansion plans on hold subject to prevailing market conditions.
“However, the group remains positive on the glove industry and will continue to focus our efforts on accelerating our transformation, and reinvestments into digitalisation and automation to increase productivity and efficiency,” it added. — Bernama