Top Glove Corporation Bhd. · MYX:TOPGLOV
Top Glove Corporation Bhd — Investor Presentation (January 2021)
27 slides from Top Glove Corporation Bhd's investor presentation, Jan 5, 2021
Slide 1: Top Glove Corporation Bhd Investor Presentation
TOP GLOVE CORPORATION BHD Investor Presentation 5th January 2021 The World’s Largest Manufacturer of Nitrile Gloves, Natural Rubber Gloves and Surgical Gloves Bursa Malaysia : 7113 SGX : BVA Reuters : TPGC.KL Bloomberg : TOPG MK ADR CUSIP : 890534100 1/27
Slide 2: TG Business Ethics Claps
TG BUSINESS ETHICS CLAPS Ready, 1 2 3 Claps, 2x 3x 2x Initiated By: Tan Sri Dr. Lim Wee Chai @ 17/07/2017 Revised By: Ng Kai Yee @ 21/09/2020 Verified By: Melissa Cheoh @ 21/09/2020 2/27
Slide 3: Top Glove at a glance
Top Glove Corporation Bhd. (“Top Glove”) at a glance World’s largest manufacturer of gloves World largest Current market manufacturer of capitalisation(1) of Nitrile, Natural Rubber RM45.89bn, 3MFY2021 USD11.45bn Revenue RM4.8bn, USD1.1bn and Surgical gloves PAT RM2.4bn, USD0.58bn About 2,000 Over 2
Slide 4: From Humble Origins to Global Leader
From Humble Origins to Global Leader 30 years track record of excellence • Revenue over RM4bn • World Largest • Implementation of Artificial Manufacturer Intelligence (AI) Empowered of Nitrile Vision Inspection System Gloves Secondary • Acquisition of Aspion, Eastern listing on • Commenced Press, Du
Slide 5: Global demand for gloves increasing across emerging and developed markets
Global demand for gloves increasing across emerging and developed markets Steady growth in global demand for rubber gloves Driven by strong market fundamentals across geographies In billion pieces 1) As a protective barrier for medical staff, gloves are an indispensable item in the healthcare sector
Slide 6: Glove Consumption Per Capita (Pieces)
Glove Consumption Per Capita (Pieces) USA: 150 Europe: 100 Germany: 141 EASTERN EUROPE NORTH WESTERN AMERICA EUROPE Italy: 123 Japan: 54 MIDDLE ASIA EAST Korea: 48 AFRICA China: 6 India: 4 LATIN AMERICA Egypt: 2 Indonesia: 2 Brazil: 24 Source: Margma 2018, Company 6/27
Slide 7: Top Glove's Distribution Across 195 Countries
Top Glove’s Distribution Across 195 Countries Distribution 6 distribution hubs globally Germany China USA Over 2,000 customers Comprising distributors across 195 countries A geographically diverse customer base An OEM manufacturer in every region Top 20 customers represent c.30% of total
Slide 8: Strategically Aligning Our Product Mix with Market Demand
Strategically Aligning Our Product Mix with Market Demand Product mix by volume Product mix by revenue for FY2019 and 1QFY2021 for 1QFY2021 Global market 100% position 90% 80% 42% 47% 43% Nitrile glove 1st 70% 60% 50% 19% Latex powder-free glove 24% 40% 30% 20% 1st 27% Latex powdered glove 20% 22% 2
Slide 9: Strong sales order book arising from COVID-19 pandemic
Strong sales order book arising from COVID-19 pandemic 1) Gloves demand continue to be robust. 2) Monthly increasing trend for ASP following strong demand, as well as higher raw material and operating costs. 3) 30% of production capacity allocated for spot orders. 4) Post Covid19 with vaccine availa
Slide 10: A Strong and Healthy Start for FY2021
A Strong and Healthy Start for FY2021 1QFY21 Profit Exceeded FY2020 Full Year Profit Comparing 1QFY2021 1QFY2021 over FY2020 Revenue RM 4,759 mil 66% of FY2020 PAT RM 2,405 mil 134% of FY2020 Dividend per share 16.50 sen 139% of FY2020 Cash flow from operations RM 3,157 mil 91% of FY2020 10/27
Slide 11: Financial Highlights: Remarkable Results
Financial Highlights: Remarkable Results 1QFY21 Comparison Revenue, RM’mil EBITDA, RM’mil PAT, RM’mil 4,759 YoY: +294% QoQ: YoY: +1,502% 3,156 YoY: +2,047% 2,405 3,110 +53% QoQ: +104% QoQ: 1,544 1,211 +99% 1,209 197 112 1QFY20 4QFY20 1QFY21 1QFY20 4QFY20 1QFY21 1QFY20 4QFY20 1QFY21 Sales quantity, b
Slide 12: Exceptional High Cash Generation
Exceptional High Cash Generation Net cash flow from operating activities, 16 Improved by 25% RM’mil Inventory 12 3,456 3,157 (days) 31/08/2020 30/11/2020 23 Improved by 30% 526 Trade Receivable 16 (days) 31/08/2019 31/08/2020 30/11/2020 31/08/2020 30/11/2020 Net cash/ (borrowings), Net cash/(borrowi
Slide 13: Sales quantity comparison by region
Sales quantity comparison by region 1Q21 vs 1Q20 comparison (YoY) 1Q21 vs 1Q20 Western Europe Eastern Europe Sales quantity up 33.9% : 1Q21 vs 1Q20 : 56.3% a) Developed market up 23.3% 1Q21 vs 1Q20 : 70.2% b) Developing market up 47.0% Asia ex Japan 1Q21 vs 1Q20 : 72.9% Eastern ASIA NORTH Western Eu
Slide 14: Cost of Production and Raw Material Price Trend
Cost of Production and Raw Material Price Trend 1QFY21 Cost Breakdown Raw Material Price Trend a) Expecting Nitrile latex price increase due to constraint in supply. b) Natural Rubber price remain stable. 14/27
Slide 15: Continuous Growth in Manufacturing Capabilities
Continuous Growth in Manufacturing Capabilities To commence Number of production lines Capacity Existing facilities Factories production by Country Glove type 1 Double Former (DF) Line (pcs per Total: 47 Factories (Calendar Quarter) = 2 Equivalent Single Former (SF) Lines annum) Malaysia Current: 36
Slide 16: Steady Growth Since Listing in 2001
Steady Growth Since Listing in 2001 Over 21 years since listing in 2001: Compound Annual Growth Rate, CAGR Average PAT margin Revenue PAT For FY ended 31 August 28% 38% 24% in RM’mil 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1Q21 Revenue 1,529.1 2,079.4 2,053.9 2,314.5 2,313.2 2,27
Slide 17: Commitment to quarterly 70% dividend payout ratio from 2QFY21 to 4QFY21
Commitment to quarterly 70% dividend payout ratio from 2QFY21 to 4QFY21 Quarterly dividend payment of 70% payout ratio from 2QFY21 to 4QFY21: Total dividend, a) Dividend Policy: Payout ratio of at least 50% PATAMI sen b) Special Dividend: 20% on PATAMI lnterim dividend, sen Total dividend paid RM 2.
Slide 18: Bursa: Track Record of Delivering Shareholder Value
Bursa: Track Record of Delivering Shareholder Value Total Shareholders Return of 27,249% over 21 years since listing in year 2001 Number of CDS and CDP Number of account As at 5/1/2021, account as at 31 Dec 2020 6th highest market capitalization in Bursa. Total CDS Account, Bursa 110,935 11th highes
Slide 19: Update on Withhold Release Order by U.S. Customs and Border Protection
Update on Withhold Release Order by U.S. Custom and Border Protection (CBP) a) Independent audit report submitted to U.S. CBP on 4/9/2020. b) The total remediation is approximately RM136 million, in accordance with recommendations by the independent consultant. Top Glove has made 5 remediation payme
Slide 20: Investment in Better Accommodation: Existing
Investment in Better Accommodation: Existing Male Hostel Female Hostel In the past, we have invested RM70mil in more than 100 double-storey houses and hostels Double-Storey Houses with full facilities. 20/27
Slide 21: Invest in Better Accommodation: Short term plan
Invest in Better Accommodation: Short term plan 1. An investment of RM20mil in 2. Renting additional houses and apartments. the past 2 months on purchasing 100 units of apartments for workers. Apartments Apartments Bedroom Kitchen 21/27
Slide 22: Invest in Better Accommodation: Short term plan
Invest in Better Accommodation: Short term plan 3. Renting Westlite-PKNS Accommodation Kelana Jaya a) 2 blocks of hostel can accommodate 6,000 person. b) Top Glove has relocated 2,000 workers to this hostel. c) Facilities available: i. Canteen (Halal) ii. Mini Mart iii. Self service laundry iv. Game
Slide 23: Invest in Better Accommodation: Mid term plan
Invest in Better Accommodation: Mid term plan Building and purchasing new workers’ hostels, fully equipped with facilities and amenities. Klang Banting Total Banting i) Construction by Top Glove 4 Blocks Lot 213 and Lot 214, Lot 4941 : February 2022 3 Blocks Lot 5116 : April 2022 Block 1 : July 2021
Slide 24: Going Forward
Going Forward 1. Stronger quarters ahead: a) Higher capacity due to on going expansion plan. b) Stronger growth in Nitrile gloves sales volume : i. Additional capacity for Nitrile gloves ii. Sufficient NBR latex iii. Switching of Latex production lines to produce more Nitrile gloves. c) Product mix
Slide 25: Going Forward
Going Forward 2. Stockpile of gloves at critical low level US stockpile dropped from 16.9 billion pieces in December 2019 to 2 billion pieces in October 2020. [Source: CBS news on 6 December 2020] 3. Vaccine will take time to be available globally. Also, application of vaccine will require more glov
Slide 26: Thank you
Thank you www.topglove.com | invest@topglove.com.my | +603 3362 3098 Bursa Malaysia : 7113 SGX : BVA Reuters : TPGC.KL Bloomberg : TOPG MK ADR CUSIP : 890534100 26/27
Slide 27: Top Glove Safety Claps
TOP GLOVE SAFETY CLAPS TOP QUALITY, TOP EFFICIENCY Ow Ready, 1 2 3 => TOP GLOVE § | = Top Safety gs = Top Safety gs S = Top Safety & Ris ES Claps, 2x 3x 2x wiasormscimneowe novo Mili IMPROVE! IMPROVE! IMPROVE! g\ Revised By: shee slew How @ 07/08/2020 Verified By: Ng Yong Lin @ 07/08/2020 27/27