Top Glove Corporation Bhd. · MYX:TOPGLOV
Top Glove Corporation Bhd — JPMorgan (September 2020)
23 slides from Top Glove Corporation Bhd's conference presentation, Sep 8, 2020
Slide 1: Top Glove Corporation Bhd Investor Presentation
TOP GLOVE CORPORATION BHD Investor Presentation 8th Sep 2020 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 Page 1/23
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: Shee Siew How @ 07/08/2020 Verified By: Ng Yong Lin @ 07/08/2020 Page 2/23
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 RM 62.12bn 9MFY2020 and Surgical gloves (USD 14.91bn) Revenue RM4.1bn (USD0.98bn) PAT RM577.8mil (USD137.0mil) 85.5 bi
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 of Intelligence (AI) Empowered Nitrile Gloves Vision Inspection System Secondary • Acquisition of Aspion, Eastern listing on Press, Duramedical. Sin
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 2) Increasing hygiene standards and healthcare awareness 3
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 Egypt: 2 AMERICA Indonesia: 2 Brazil: 24 Source: Margma 2018, Company Page 6/23
Slide 7: 3QFY20 Financial Highlights: Remarkable Results
3QFY20 Financial Highlights: Remarkable Results Revenue (RM’mil) PAT (RM’mil) EBITDA margin (%) (3 months) 350 1,688 YoY: 28.3% YoY: +367% +1540 bps YoY: +42% QoQ: QoQ: QoQ: +202% +1170bps 16.6% 1,190 1,230 +37% 116 75 12.9% 3QFY19 2QFY20 3QFY20 3QFY19 2QFY20 3QFY20 3QFY19 2QFY20 3QFY20 Sales quanti
Slide 8: Strengthening of Balance Sheet Position
Strengthening of Balance Sheet Position Strong balance sheet to support ongoing expansion Total Assets (RM’bil) 49 46 Improved by +30% 39% 7.4 Inventory 28 5.7 7.2 +3% (days) 31/8/2019 29/2/2020 31/5/2020 Improved by 31/8/2019 29/2/2020 31/5/2020 44 43 19% 35 Total Equity (RM’bil) Trade Receivable +
Slide 9: Strong Cash Generation: Net cash as at 31/5/20
Strong Cash Generation: Net cash as at 31/5/20 Net cash flow from operating activities (RM’mil) (9 months to 31 May) 1,196 Turning into Net Cash due to: a) Higher net cash flow from operating activities from 219% strong profit performance b) Improve in working capital management c) 64% of convertibl
Slide 10: Strong sales order book from COVID-19 outbreak
Strong sales order book from COVID-19 outbreak 1) Gloves demand continue to be robust. 2) Monthly increasing trend for ASP due to strong demand, higher raw material cost and operating costs. 3) Allocate 30% of production capacity for spot order. 4) Post Covid19 with vaccine available, we expect glov
Slide 11: Update on U.S Custom and Border Protection (CBP)
Update on U.S Custom and Border Protection (CBP) Update on CBP issues : a) Top Glove has been actively engaging with the U.S CBP towards resolving the Withhold Release Order expeditiously. b) We are currently working with an independent consultant to perform the verification work. c) The independent
Slide 12: Continuous rapid growth in capacity
Continuous rapid growth in capacity Total Capacity Growth Capacity FY19 to FY20 :+33% (bil pcs) FY20 to FY21 :+20% 120.0 16.1 118.2 FY21 to FY22 :+16% 3.1 1.9 102.1 100.0 8.0 3.9 Additional new capacity to 85.2 meet the strong demand from 80.0 every country in the world, to ensure its life-savings g
Slide 13: Continuous Growth in Manufacturing Capabilities
Continuous Growth in Manufacturing Capabilities Factories To commence production by Country Glove type Number of production lines 1 Double Former (DF) Line Capacity (pcs per Existing facilities (Calendar Quarter) = 2 Equivalent Single Former (SF) Lines annum) Total: 46 Factories Current: 35 glove fa
Slide 14: Significant improvement in productivity through technology
Significant improvement in productivity through technology No. of workers Ongoing focus on innovation, per mil pcs of gloves automation, digitalisation and 9.00 8.40 artificial intelligent, significant reduced the number of workers 8.00 requirement per million pcs. 7.00 6.00 5.80 5.00 4.10 4.00 3.69
Slide 15: Strategically Aligning Our Product Mix with Market Demand
Strategically Aligning Our Product Mix with Market Demand Product mix by volume from Product mix by revenue FY2011 to 9MFY2020 for 9MFY2020 60% 55% Global market position Vinyl 2% TPE/CPE 2% 50% 47% 42% Nitrile glove 1st Surgical 40% 10% 30% 27% 26% 22% Latex Powder Free Nitrile Latex powdered glove
Slide 16: Raw Material Cost
Raw Material Cost 9MFY20 Cost Breakdown Raw Material Price Trend Page 16/23
Slide 17: Steady Growth Since Listing in 2001
Steady Growth Since Listing in 2001 Revenue CAGR PAT CAGR Average PAT margin Over 20 years since Over 20 years since Over 20 years since listing in 2001 : listing in 2001 : listing in 2001 : For FY ended 31 August 21.4% 22.7% 10.0% (in RM’mil) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 9
Slide 18: Total dividend payment of RM1.84bil since listing in 2001
Total dividend payment of RM1.84bil since listing in 2001 Propose dividend take into consideration of : a) Company’s available cash and cash equivalents b) Return on Equity and Retained Earnings of Company c) Company’s projected capital expenditure and investment plans. TotalDividend 14 21 27 32 66
Slide 19: Track Record of Delivering Shareholder Value
Track Record of Delivering Shareholder Value Total Shareholders Return of 35,561% over 20 years since listing in year 2001 As at 8/9/2020, 3rd highest market capitalization in Bursa. 9th highest market capitalization in SGX. YTD share price appreciation of 387.6%. With initial investment of 1,000 sh
Slide 20: Environmental Social Governance
Creating Sustainable Value for People & Environment Top Glove is a member of the DJSI & FTSE4Good ESG indices: • Compliance with regulatory requirements & EMS ISO 14001 • Cognisant of climate risk & committed to minimise our carbon footprint • Mindful to conserve natural resources Compliance & Clima
Slide 21: Top Glove's Medium and Long Term Objectives
Top Glove’s Medium and Long Term Objectives Our Vision : Our Mission : To be your world –class partner in Ensuring safe human protection gloves and healthcare products globally supported by our values OUR PEOPLE OUR PRODUCTS, OUR FINANCIALS PROCESS & CUSTOMERS Healthy workforce living Diversify to g
Slide 22: Q&A Thank you
Q&A Thank you www.topglove.com | invest@topglove.com.my | +603 3362 3098 Page 22/23
Slide 23: Top Glove Group of Companies
TOP GLOVE GROUP OF COMPANIES Ready, 1 2 3 TOP GLOVE Top Safety Top Safety Top Safety Claps, 2x 3x 2x Initiated By: Tan Sri Dr. Lim Wee Chai @ 28/01/2020 Revised By: Shee Siew How @ 07/08/2020 IMPROVE! IMPROVE! IMPROVE! Verified By: Ng Yong Lin @ 07/08/2020