Embed Size (px)
Citation preview
1/22
Bursa Malaysia : 7113 SGX : BVA Reuters : TPGC.KL Bloomberg : TOPG MK ADR United States TGLVY
TOP GLOVE CORPORATION BHD
The World’s Largest Manufacturer of Nitrile Gloves, Natural Rubber Gloves and Surgical Gloves
Macquarie ASEAN Virtual Conference
Date: 26th August 2021, Thursday
2/22
Thumbs Up, Ready, 1 2 3
Claps, 2x 3x 2x Initiated By: Tan Sri Dr. Lim Wee Chai @ 17/07/2017Revised By: Ng Kai Yee @ 18/05/2021Verified By: Melissa Cheoh @ 18/05/2021
TOP GLOVE BUSINESS ETHICS CLAP
3/22
Thumbs Up, Ready, 1 2 3
Claps, 2x 3x 2x
HEALTHY! HEALTHY! HEALTHY!
EAT WELL
WORK WELL
EXERCISE WELL
Initiated By: Tan Sri Dr Lim Wee Chai @ 18/05/2021 Prepared By: Andy Ting @ 18/05/2021Verified By: Melissa Cheoh @ 18/05/2021
CLEAN WELL
SLEEP WELL
TOP GLOVE
TOP GLOVE 5 HEALTHY WELLS CLAP
4/22
100 billion gloves pa 48 factories
812 production lines(As at August 2021)
Over 1,600 customersacross 195 countries
Current market capitalisation(1) of
RM 30.10 bil,
USD 7.12 bil
The World largest manufacturer of
Nitrile, Natural Rubber and Surgical gloves
Over 22,000 employees
Source: Bloomberg
Note: (1) Market capitalisation as at 23 August 2021
9MFY2021
Revenue RM14.3bil, USD3.5bil
PAT RM7.4bil, USD1.8bil
The World’s Largest Manufacturer of Gloves
Top Glove Corporation Bhd. (“Top Glove”) at a glance
5/22
1994 2002
2004 2011
2007 2013 2017
2016 20202001 2018
2019
From Humble Origins to Global Leader
2021
1991
Started as a local business enterprise
First overseas foray and established a marketing arm in the USA
Commenced operations in Thailand
Listed on the Second Board of Kuala Lumpur Stock Exchange (“KLSE”)
Commenced operations in China
Transferred to the Main Board of KLSE
The World Largest Manufacturer of Natural Rubber Gloves
Revenue over RM1 bil
Acquisition of a majority stake in Medi-Flex
Acquired a marketing arm inGermany to extend sales in Europe
Establishedfirst dedicated Group R&D Centre to drive innovation
Secondary listing on Singapore Stock Exchange (“SGX”)
Revenue over RM3 bil
Commenced condom business in July 2018
Revenue over RM4 bil Implementation of
Artificial Intelligence (AI) Empowered Vision Inspection System
Acquisition of Aspion, Eastern Press, Duramedical
The World Largest Manufacturer of Surgical Gloves
Launched BioGreenBiodegradable Gloves
Implemented Manufacturing Execution System (MES) and Advanced Auto Packing Machine
The World Largest Manufacturer of Nitrile Gloves
Commenced operations in Vietnam
9MFY21 PAT of RM7.4 bilexceeded past 20 years PAT
Highest dividend declared in 9MFY21 of RM4.8 bil
6/22
Increasing Global Glove Demand
In billion pieces Driven by strong market fundamentals across geographies:
1) As a protective barrier for medical staff, gloves are an indispensable item in the healthcare sector, with increasing customer awareness in developing markets
2) Increasing hygiene standards and healthcare awarenessa) Non-medical sector in developed countriesb) Medical sector in developing countries
3) A growing ageing populationa) With the elderly being more susceptible to higher
risk diseases
4) Progressively stringent health regulationsa) Healthcare reforms in US and Chinab) Healthcare regulations: OSHA in the US, EU-OSHA in
Europe, SESI in Brazil
5) Emergence of new health threatsa) COVID-19, A(H1N1), SARS, bird flu, ebola, bio-
terrorism, Anthrax
Steady growth in global demand for rubber gloves
Source: Frost and Sullivan, August 2021
202 213238
272293
357
430
501
570
CY2015 CY2016 CY2017 CY2018 CY2019 CY2020 CY2021F CY2022F CY2023F
+22%
+20%
+17%
+14%
7/22
500
743
247
637
663
1,307
4,346
North America
Europe
Middle East
Latin America and the Caribbean
Southeast Asia
Africa
Asia and Pacific
300
208180
133
9 7 6
UnitedStates
Germany UnitedKingdom
Japan China India Indonesia
[1]
Glove per Capita Consumption in 2020, Pieces
High glove usage indeveloped countries
Low glove usage indeveloping countries
Population by Region in 2020, ‘mil People
High Population in developing countries
Population in developed countries
Strong growth opportunity in developing countries on the back of large population but current low glove usage
Source: Frost and Sullivan, August 2021[1] Germany and United Kingdom refer to 2019 data Source: Frost and Sullivan, August 2021
[1]
Healthcare Spending Will Continue to Increase in Emerging Market
8/22
Distribution
7 distribution hubs globally
Over 1,600 customers
An OEM manufacturer in every region
Top 5 customers represent c.16% of total revenue
No single customer contributes more than 5% of revenue
Comprising distributors across 195 countries
A geographically diverse customer base
USA
Brazil
Germany
Vietnam
Thailand
Malaysia
North America 18%
Western Europe 21% Eastern Europe 18%
Latin America 9%Africa 1%
Asia ex Japan 20%
China
Japan 8%
Middle East 5%
Distribution Across 195 Countries: % of 9MFY21 Sales Volume by geographic
Top Glove’s Distribution Hubs
9/22
Natural rubber powder-free glove
55%
27%22%
22%
26%
19% 20%
23%
11%
43%47%
43%
7%9% 8%
10%
1% 2% 3%2%
0%
10%
20%
30%
40%
50%
60%
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 9MFY21
Nitrile glove
Natural rubber powdered glove
Surgical glove
Vinyl/TPE/CPE
A Diverse Glove Range for Diverse Market Preferences
% of Product Mix By Volume from FY2011 to 9MFY21Global Market Position
Since 2018
Since 2004
Since 2020
10/22
0.91
1.19
1.66
1.171.34
1.13
2.422.15
1.69
1.22
1.54
73.45
45.85
61.16
73.68
69.11
0
10
20
30
40
50
60
70
80
0.2
0.6
1.0
1.4
1.8
2.2
2.6
3.0
3.4
Aug-18 Aug-19 Aug-20 Aug-21
NR Latex & Nitrile & Butadiene Price
(USD/KG)
Latex Nitrile Butadiene Crude OilCrude Oil Price
(WTI)(USD/bbl)
Raw Material
53%
Other Overhead
14%
Fuel10%
Labour9%
Chemical8%
Packaging6%
Cost
Breakdown
Key Highlights:
a) Expecting a lower nitrile latex price as Butadiene and Acrylonitrile forecasted to decline
b) Lower natural rubber latex concentrate price expected with wintering season ended in May 2021
c) Natural gas tariff increase by 12% for the period of 1 July 2021 to 30 September 2021
d) Electricity tariff reduced by 6% for the period of 1 January 2021 to 30 June 2021
Cost of Production and Raw Material Price Trend
9MFY21 Cost Breakdown Raw Material Price Trend
11/22
To commence production by
Calendar QuarterCountry Glove Type
Number of production linesCapacity,
pcs per annum1 Double Former (DF) Line
= 2 Equivalent Single Former (SF) LinesCurrent: 37 glove factories All 812 Equivalent Single Former Lines 100 bil
1Q CY2022 Jan22 to Mar22
Malaysia Nitrile / Latex 16 DF lines 4.8 bil
2Q CY2022 Apr22 to Jun22
MalaysiaNitrile 4 DF lines 1.2 bil
Surgical 2 DF lines 0.6 bilChina PVC 2 DF lines 0.6 bil
3Q CY2022 Jul22 to Sep22
Malaysia Nitrile / Latex 4 DF lines 1.0 bil
4Q CY2022 Oct22 to Dec22
Malaysia Nitrile / Latex 24 DF lines 7.2 bilVietnam PVC 10 DF lines 2.6 bil
Additional new capacity in CY2022 62 DF lines 18 bil (+18%)Total capacity 31 December 2022 : 40 glove factories 936 Equivalent Single Former Lines 118 bil
1Q CY2023 Jan23 to Mar23
Malaysia Nitrile / Latex 29 DF lines 8.9 bil
2Q CY2023 Apr23 to Jun23
MalaysiaNitrile / Latex
12 DF lines 3.7 bilThailand 14 DF lines 4.2 bil
3Q CY2023 Jul23 to Sep23
Vietnam PVC 10 DF lines 2.6 bil
4Q CY2023 Oct23 to Dec23
Malaysia Nitrile / Latex 38 DF lines 11.6 bil
Additional new capacity in CY2023 103 DF lines 31 bil (+26%)Total capacity 31 December 2023 : 43 glove factories 1,142 Equivalent Single Former Lines 149 bil
Malaysia
Headquarters 32 Glove Factories 3 Chemical Factories 1 Glove Former 2 Packaging Factories 1 Dental Dam Factory 1 Condom Factory 1 Mask FactoryProducing:1) Latex & Nitrile Examination Gloves2) Surgical, Household, Cleanroom Gloves3) CPE/TPE Gloves4) Former & Chemical Manufacturing5) Dental Dam6) Condom7) Face MaskThailand
2 Latex Concentrate Plants 3 Glove FactoriesProducing:1) Latex Examination Gloves2) Latex ConcentrateChina
1 Glove FactoryProducing:1) Vinyl GlovesVietnam
1 Glove FactoryProducing:1) Vinyl Gloves
Continuous Growth in Manufacturing Capabilities
Total: 48 Factories
12/22
To commence production by Calendar Quarter
Country Glove TypeNumber of production lines
Capacity, pcs per annum
1 Double Former (DF) Line = 2 Equivalent Single Former (SF) Lines
1Q CY2024 Jan24 to Mar24
MalaysiaNitrile / Latex 23 DF lines 6.8 bil
Surgical 4 DF lines 1.2 bil2Q CY2024
Apr24 to Jun24Malaysia Nitrile / Latex 36 DF lines 10.8 bil
3Q CY2024 Jul24 to Sep24
Vietnam PVC 10 DF lines 2.6 bil
4Q CY2024Oct24 to Dec24
Malaysia Nitrile / Latex 12 DF lines 3.6 bil
Additional new capacity in CY2024 85 DF lines 25 bil (+17%)Total capacity 31 December 2024: 44 glove factories 1,312 Equivalent Single Former Lines 174 bil
1Q CY2025 Jan25 to Mar25
MalaysiaNitrile / Latex
14 DF lines 4.4 bilThailand 30 DF lines 9.2 bil
2Q CY2025 Apr25 to Jun25
Malaysia Nitrile / Latex 31 DF lines 9.8 bil
3Q CY2025 Jul25 to Sep25
Vietnam PVC 10 DF lines 2.9 bil
4Q CY2025 Oct25 to Dec25
Malaysia Nitrile / Latex 12 DF lines 3.7 bil
Additional new capacity in CY2025 97 DF lines 30 bil (+17%)Total capacity 31 December 2025: 47 glove factories 1,506 Equivalent Single Former Lines 204 bil
Continuous Growth in Manufacturing Capabilities (Con’t)
13/22
Our Successful Technology Transformation
Advanced Production Line
Automated Stacking & Counting
Automated Stripping
AI Vision Camera
Scada system
Robotic Arm
Product and process innovation to produce safer and higher quality products efficiently
1 10 R&D centres across Asia: 7 centres in Malaysia, 2 centres inThailand and 1 centre in China
21,250 researchers, including 38 PhD holders and 130 Master’s Degreeholders with experience in product and material development,sustainable technologies, engineering and automation
Workers Per Million, WPM
WPMIn FY2010
4.0 1.6
WPMAs at July 2021Latest Factory
60% Improvement
3 Investment in improving automation and AI capabilities, includinginstallation of AI Vision Cameras and advanced automated strippingand stacking machines
14/22
16.5 5.3
1Q21 2Q21 3Q21
7.2
25.2
18.0
18.0
12.7
1.0 1.4 0.9 1.4 1.4 1.41.9 2.4 2.4 2.8 2.5
11.8
20.0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 9M21
+406%
12.5
59.7
47.2
Note: Dividend per share has been adjusted for the bonus issues
A High Dividend and High Growth Company
Reward Shareholders with High Dividend in an Exceptionally Good Year
In addition to existing dividend policy of 50%
The Board is committed to a Special Dividend of 20% for 2QFY21 to 4QFY21
Committed to 70% dividend payout ratio for 4QFY21
FY2021
Quarterly Dividend
Total Dividend* 66 99 68 99 99 99 143 182 182 217 192 962 4,782
Payout Ratio 39% 40% 60% 49% 51% 55% 51% 50% 54% 51% 53% 55% 66%
*RM mil
1,324 2,017 1,441
56% 70% 71%
Ordinary Dividend, sen
Special Dividend, sen
15/22
RM’mil 2001 2005 2010 2011 2015 2016 2017 2018 2019 2020 9MFY21
Revenue 138.9 641.8 2,079.4 2,053.9 2,510.5 2,888.5 3,409.2 4,220.7 4,801.1 7,237.4 14,286.6
EBITDA 23.9 89.2 364.7 207.3 441.7 524.7 489.3 694.0 687.5 2,421.5 9,601.7
EBITDA margin 17.2% 13.9% 17.5% 10.1% 17.6% 18.2% 14.4% 16.4% 14.3% 33.5% 67.2%
PBT 17.2 65.7 305.0 145.5 363.5 442.2 393.4 522.8 423.6 2,165.6 9,413.2
PBT margin 12.4% 10.2% 14.7% 7.1% 14.5% 15.3% 11.5% 12.4% 8.8% 29.9% 65.9%
Taxation 1.3 7.6 54.6 30.3 82.3 79.8 54.5 89.6 56.1 376.7 2,059.8
PAT 15.9 58.2 250.4 115.1 281.2 362.4 338.9 433.2 367.5 1,788.8 7,353.4
PAT margin 11.5% 9.1% 12.0% 5.6% 11.2% 12.5% 9.9% 10.3% 7.7% 24.7% 51.5%
ROE, % 17.0% 28.6% 22.4% 10.0% 17.4% 19.9% 16.3% 18.1% 14.4% 28.9% 103.9%
Over 20 Years Since Listing in 2001
Compound Annual Growth Rate, CAGRAverage PAT Margin
Revenue PAT
28% 38% 24%
High Growth Company Since Listing in 2001
#
Note: # Based on latest 12 months PAT
31 August Financial Year End
16/22
Number of shares held(1) Market value
(as at 23 August 2021)
Accumulated
Dividends
Investment cost
(as at 27 March 2001)
Capital
appreciation(2)
Total shareholder
return
# RM RM RM RM %
122,304 459,863 93,564 2,700 550,727 20,397%
With initial investment of 1,000 shares made based on IPO price of RM2.70 on 27 March 2001, the return would be:
Bursa: Shareholder Value Track RecordsTotal Shareholders Return of 20,397% Over 20 Years Since Listing in Year 2001
As at 23/8/2021:
14th highest market capitalization in Bursa
18th highest market capitalization in SGX
Source: Registrar of Depository
Number of CDS and CDP
account
Number of account
as at 13 August 2021
Total CDS Account, Bursa 125,839
Total CDP Account, SGX 9,366
Grand Total 135,205
Source: Reuters as at 23 August 2021
Notes: (1) 1,000 shares at IPO, adjusted for bonus issue and share split since IPO
(2) Calculated based on adding market value and accumulated dividends and subtracting the investmentcost
17/22
Forced Labour Indicators
vs
Impactt UK assessment
Investigation
completed
28/08/2020
CAP
verification
October 2020
CAP
verification
January 2021
Accommodation
inspection
March 2021
CAP
verification
April 2021
1. Abuse of vulnerability
2. Retention of identity documents
3. Restriction of movement * *
4. Excessive overtime
5. Abusive working and living conditions
6. Deception
7. Isolation
8. Debt bondage
9. Withholding of wages
10. Physical and sexual violence **
11. Intimidation
Notes: *It is important to note that various mandatory government movement control orders (MCOs) are in place to prevent the spread of COVID-19, despite all prior
issues being closed, restriction of movement remains factually present.
** ILO Forced Labour Guidance on Physical and Sexual Violence’ states…’Forced labourers..may be subjected to actual physical or sexual violence….to have
greater control over them.’ It is Impactt’s opinion that the instances of physical and sexual violence at TG are not related to the company gaining ‘greater
control over workers’, therefore these instances, although concerning, are not indicative of systemic forced labour.# CAP = Corrective Action Plan
Source: Impactt UK Report, 22 April 2021, ILO Indicators in Top Glove direct operations
Green = All issues closed
Pale Yellow = Further progress
made
Light Yellow = Significant
progress made on issues
Dark Yellow = Critical issues
present but isolated / or in supply
chain
Orange = Critical issues present,
but progress is being made
Red = Critical issues requiring
immediate actionF
E
D
C
B
A
Key:
Note: The indicator of A to F is
added in for easy reference
Top Glove has achieved all Green on the International
Labour Organization (ILO) 11 Forced Labour Indicators
11 A# # #
18/22U.S. Customs and Border Protection (CBP) Withhold Release
Order Modification Processes
Top Glove is at this stage currently
19/22Top Glove Vaccination Programme
20/22
We aspire to be the Glove Manufacturer of Choice for customers which
driven by the integration of sustainability into every aspect of our business. Good business starts with strong ethics and the Group is linking Executive Compensation to ESG Metrics.
Commitment
2021 is Year of ESG for Top Glove:
Environmental, Social & Governance
Product Quality and Safety
Occupational Health & Safety
Talent RetentionHuman Rights and Labour Practices
Reduce Carbon Emission
40% of KPIs linked to ESG metrics in 5 focus areas
Performance indicator: Customer complaints rate
Performance indicator: Occupational accident rate
Performance indicator: Top performing employee turnover
Performance indicator: Social ethical audit scoring
Performance indicator:Scope 1 & 2 emission intensity reduction
Good Business champions
Good Environmental Practices
Good Business is Supported by
Good People
Good Business Starts with
Strong Ethics
Link to Top Glove’s Sustainability page: https://www.topglove.com/sustainability/
22/22
Thumbs Up, Ready, 1 2 3
TOP GLOVE
Claps, 2x 3x 2x
IMPROVE! IMPROVE! IMPROVE!
Top Environment
Top Social
Top Governance
Initiated By: TG Year of ESG Committee @ 19/04/2021Verified By: Mr. Ng Yong Lin @ 18/05/2021Approved By: Tan Sri Dr Lim Wee Chai @ 18/05/2021
TOP GLOVE ESG CLAP
