Glove manufacturer Riverstone Holdings posted earnings of RM331.1 million ($108.5 million) in its 4Q2020 ended December, up from RM32.1 million in the previous year.

This follows a surge in its revenue to RM720.8 million in 4Q2020 from RM257.4 million in the year before that comes from the heightened demand for personal protective gear.

For its full-year ended December 2020, Riverstone’s earnings soared by some 396.3% to RM647.3 million, from RM130.4 million in 2019.

On a fully diluted basis, this translates to earnings per share of 43.67 sens in FY2020, versus 8.80 sens in FY2019.

Revenue for FY2020 rose by 85% to RM1.83 billion, thanks to higher quantities of healthcare and cleanroom glove shipments.

Other sources of income amounting to RM4.7 million – up 23.6% y-o-y – came in from higher interest collections.

In terms of geography, the highest income contributions came from Europe (RM529.6 million), the US (RM325.1 million), Singapore (RM268.8 million), Malaysia (RM156.2 million) and Greater China (RM112.3 million).

The group also had revenue streaming in from Thailand (RM49.9 million), other parts of southeast Asia (RM68.4 million), other parts of Asia (RM258.3 million) and the rest of the world (RM61.4 million).

In this time, Riverstone’s cost of sales was up by 18% to RM932.3 million, in line with its increased production levels.

As such, its gross profit surged by 351.3% to RM897.6 million in FY2020. With this, its gross profit margin improved from 20.1% to 49.1%, thanks to higher average selling prices.

Meanwhile, the group’s sales and distribution expenses edged up by 25.0% to RM17.6 million, following an increase in its sales activities.

General and administrative expenses similarly was up by 57.3% to RM34.4 million due to higher performance incentives given out.

Riverstone’s executive chairman and CEO Wong Teek Son expects demand for the company’s healthcare examination gloves to “remain robust” in the near to medium-term as healthcare providers continue to fulfill immediate supply shortfalls and replenish reserves.

He adds that the company is also looking to differentiate itself from its peers through its high-end cleanroom glove business. The segment has also experienced significant growth, especially from manufacturing industries producing lenses, batteries and semiconductors.

However, Wong foresees challenges in macroeconomic headwinds such as US dollar fluctuations, volatile raw material prices and increases in overall production costs.

Still says: “for the foreseeable future, we believe that glove demand for healthcare and cleanroom gloves will remain high due to ongoing Covid-19 testing and vaccine rollout which require the usage of gloves”.

As part of its expansion plans, the company is looking to slated to hit its annual production capacity to 10.5 billion pieces of gloves. 

Following this, it hopes to add up to 1.5 billion pieces of gloves across its expansion phases in the near-term. This will bring its annual glove production by 42.9% to 15.0 billion pieces by end FY2023.

With cash and cash equivalents of RM648.9 million at end December, up from RM130.4 million in the year before, the company appears to be well endowed to see its plans through.

Riverstone has declared a special dividend of 4 sens per share, along with a final dividend of 16 sens. This brings its total dividend pay out for FY2020 to 22 sens.

By comparison, it had paid out 7.4 sens in dividends in FY2019.

As at 2.12pm on Mar 1, shares in Riverstone Holdings were flat at $1.36.