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SUPERMX: Supermax Corporation Berhad - thestockmonger
About Supermax Corporation Berhad
Supermax Corporation Berhad (SUPERMX) is a manufacturer of medical gloves. It has 12 factories in Malaysia manufacturing various types of natural rubber and nitrile latex gloves. These products are exported worldwide to over 165 countries.
Besides that, Supermax is also the first home-grown contact lens manufacturing company. They ventured into the contact lens business back in 2014, the group has invested approx. RM100 million for this venture. Currently, Supermax exports lenses to over 60 countries and they are looking to expand their reach.
Income Statement
In FY2019, Supermax grew its revenue and net profit by 17.9% and 11.77% respectively. The growth was attributed on increased production volume and improved operation efficiency.
On the other hand, dividend paid was slightly inconsistent due to the up and downs of net profit and paying treasury shares instead of cash for final dividend in FY2019.
The average 5 year ROE is 10.77%. This means for every RM100 of shareholders’ money, Supermax can make RM10.77. With its latest earnings and balance sheet, their ROE is 11.52%.
Based on the chart above, half of Supermax’s revenue came from the US followed by Europe (26%), Asia and Ocenia (21%) and Africa (3%)
Balance Sheet
The total asset of Supermax is largely consists of properties, plant and equipment. The remaining portions are mostly consists of inventories, receivables and cash.
As for liabilities, they are mostly borrowings and payables.
Shareholders’ equity has increased over the past 5 years.
Prospects
Currently, Supermax has a production capacity of 24 billion pieces of gloves per annum. They are planning to expand production capacity to 27 billion pieces by 2020, then 44 billion pieces by 2024.
The 12th and latest plant has commenced operations in October 2019. Moving forward, Supermax has also acquired a large piece of land in the vicinity of existing plants in Meru, Klang. Plans were made to build 3 more plants. These 3 new plants are expected to fulfil the demand growth for the next 5 years u until 2024.
Valuation
Using the latest per share numbers of SUPERMX,
Book value = 83 sen
DPS = 2.45 sen
EPS = 9.39 sen
Do take note that the final dividend of 2019 was paid in the form of 1 treasury share for every 65 ordinary share held by SUPERMX shareholder instead of cash. Moving forward, the dividend paid may be more compared to this year if SUPERMX decides to pay cash for all dividends.
At the time of writing (2nd February 2020), SUPERMX is trading at it’s 52 weeks high. The share price has risen rapidly due to the outbreak of the coronavirus in Wuhan, China.
https://thestockmonger.com/supermx/
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2020-02-08 08:47