Medi-Flex

Medi-Flex: Group announced 2Q13 results, revenues up 6% y/y to RM43.5m, earnings up 271% y/y to RM3.9m. The increase in revenue was driven by higher nitrile glove sales and reaping the economics of scale by optimizing its production line capacity, as well as an decline in raw material prices, where the latex average price declined by 14.5% (from RM6.81/kg in 2Q2012 to RM5.82/kg in 2Q2013), and nitrile average price declined by 26.0% (from RM5.04/kg in 2Q2012 to RM3.73 in 2Q2013). In addition, the Group also recognised the deferred tax assets of RM1.25m in 2Q2013 arising from the unutilized tax credit. Going forward, 2H13 will remain competitive with the impact of the implementation of minimum wage policy, volatility of raw materials prices and foreign exchange rate. Group maintains confidence to deliver consistent business performance due to the strong global glove demand. Group's investments in the new advanced production line which will be fully completed in Apr 2013, which will further reduce the dependency on manual labour and minimize the effects of the minimum wage policy.