3 Things Investors Should Know About Kossan Rubber Industries Berhad, One Of The Top Three Gloves Player In The World

Credit: Rvierstone Holdings Limited

Kossan Rubber Industries Berhad (KLSE: KOSSAN) is one of the major gloves makers in the world that is listed on the KLSE Malaysia. Investors who are interested in Top Glove (SGX: BVA) or Riverstone Holdings Limited (SGX: AP4) will likely be interested in this company too.

In this article, we will share three things about the company from its latest results.

Overall performance

Source: Kossan Rubber FY 2017 Quarter Two Result Announcement

What’s useful to note from the above is that Kossan grew both its top line and bottom line in the quarter, as compare to the same period last year, mainly driven by increase in volume and sales price of gloves sold in the quarter.

Segmental performance

Source: Kossan Rubber FY 2017 Quarter Two Result Announcement

Here, we see that the Gloves segment was the biggest contributor to the Kossan, follow by Technical Rubber segment and lastly Clean-Room segment.

Balance sheet

One of the key criteria to focus on a company before investing is the balance-sheet strength.

What investors would like to see is a strong balance sheet with plenty of cash and low debt. As for Kossan, it ended the quarter with RM179.7 million in cash and RM289.6 million in debt.

Net debt, taking into account of both numbers above, amounts to RM110 million, which was about 10% of equity (RM 1.17 billion).

In other words, Kossan has a strong balance sheet with low gearing.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned. Motley Fool has a buy recommendation for Riverstone.