SINGAPORE (May 8): Cleanroom and healthcare gloves manufacturer Riverstone Holdings posted a 7.6% decline in earnings to 31.1 million ringgit ($10.5 million) for the 1Q ended March, from 33.6 million ringgit a year ago.

1Q18 revenue climbed 2.0% to 209.8 million ringgit, from 205.7 million ringgit a year ago.

However, gross profit fell 9.5% to 46.9 million ringgit in 1Q18, as gross profit margin shrank by 2.9 percentage points to 22.3%.

The lower margin was mainly due to adverse foreign exchange conditions which resulted in a lower average selling price in terms of the Malaysian ringgit.

As at end March, cash and cash equivalents stood at 135.1 million.

“While encouraged by the strong demand in key markets for our premium healthcare and cleanroom gloves, we were impacted by macroeconomic headwinds weighing on our industry in the form of foreign exchange rate volatility. Nevertheless, we remain in growth mode,” says Wong Teek Son, Riverstone’s executive chairman and CEO.

“Our operations are robust as we continue to maintain high utilisation rates which reinforce the need for continued expansion initiatives. Furthermore, we are making improvements to operational efficiency by progressively introducing automation within our production processes,” he adds.

Meanwhile, Riverstone says it is continuing on its expansion plans for new production lines, which will see its total annual capacity lifted to 10.4 billion pieces by end-FY19, from 7.6 billion pieces as at end-FY17.

“With this added capacity in the pipeline, we continue to extend our marketing efforts toward existing and new customers from newer geographies such as the US to capture the region’s burgeoning demand for our products,” Wong says.

Shares of Riverstone closed 1.5 cents lower at 98.5 cents on Tuesday.

Riverstone sees 7.6% drop in 1Q earnings to $10.5 mil on lower margins

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