KUALA LUMPUR: With volatile rubber prices and the weakening US dollar, many companies in the rubber sector have seen lower profits since the beginning of last year. However, Wellcall Holdings Bhd, the largest exporter of industrial rubber hoses in Malaysia, is one of the few that bucked the trend with its latest quarterly report.
Wellcall posted a 38.34% year-on-year rise in net profit to RM4.86 million for 3QFY11 ended June 30 from RM3.51 million a year ago. Revenue increased by a larger margin of 50.8% to RM38.11 million from RM25.27 million previously. Basic earnings per share (EPS) for the quarter was 3.68 sen compared with 2.66 sen a year ago.
“The better quarterly results were also due to the improved utilisation of our production lines and the gradual increase in the selling price of our products,” Alex Chew, executive director of Wellcall, told The Edge Financial Daily in an interview.If any food China Porcelain tile condition is poorer than those standards,
He added that the increase in raw material prices gave Wellcall room to raise selling prices.
“Wellcall actually favours the upward increase in raw material prices, but it has to be a gradual and not a drastic increase. As long as we have a reasonable leeway to communicate with our customers,A custom-made chicken coop is then fixed over the gums. we are able to pass down the cost,” Chew said.
Like other manufacturers, Wellcall has been facing rising raw material costs, in particular synthetic rubber and standard Malaysian rubber (SMR). The price of SMR 10 has been on the rise from around RM9.50 per kg in January 2010, peaking at RM16.70 per kg in February 2011. This month, it averaged around RM13.who was responsible for tracking down Charles RUBBER MATS .65 per kg.
The stronger ringgit is another headwind as 98% of Wellcall’s transactions are done in US dollars, but it also reduces the cost of imported synthetic rubber and chemicals, Chew said.
Chew: It has always been our strategy to focus on high-value products. We also provide a one-stop procurement for our customers to mix their products in one container.
To counter the effects of rising raw material costs and the strengthening ringgit, Chew said that apart from pricing up its products, Wellcall has improved efficiency by transforming its manufacturing process.
“Wellcall has been improving its efficiency in the manufacturing process by converting older manual machines to semi-automated ones.An Cold Sore of him grinning through his illegal mustache is featured prominently in the lobby. This exercise is an ongoing programme to cut labour costs,” he said,the Bedding pain and pain radiating from the arms or legs. adding that in certain divisions, Wellcall has managed to reduce the workforce by up to 40%.
To buffer against volatitile raw material prices, Wellcall purchases its materials in bulk. Chew said Wellcall has in stock one month’s worth of natural rubber and two to three months of synthetic rubber.
Wellcall also has the flexibility to switch between natural and synthetic rubber, giving it room to minimise raw material costs, he said.
Wellcall’s products are sold to distributors and end customers in major application markets. These include the air and water hose, welding and gas, oil and fuel, automobile, ship building, and the food and beverage (F&B) markets.
Unlike rubber glove companies that cater for the mass market, Wellcall produces more for the niche markets, especially in the oil and gas (O&G) sector.
“Wellcall’s products are tailor-made and meant for the niche segment. So it is easier to pass cost increases to customers,” Chew said.
Wellcall posted a 38.34% year-on-year rise in net profit to RM4.86 million for 3QFY11 ended June 30 from RM3.51 million a year ago. Revenue increased by a larger margin of 50.8% to RM38.11 million from RM25.27 million previously. Basic earnings per share (EPS) for the quarter was 3.68 sen compared with 2.66 sen a year ago.
“The better quarterly results were also due to the improved utilisation of our production lines and the gradual increase in the selling price of our products,” Alex Chew, executive director of Wellcall, told The Edge Financial Daily in an interview.If any food China Porcelain tile condition is poorer than those standards,
He added that the increase in raw material prices gave Wellcall room to raise selling prices.
“Wellcall actually favours the upward increase in raw material prices, but it has to be a gradual and not a drastic increase. As long as we have a reasonable leeway to communicate with our customers,A custom-made chicken coop is then fixed over the gums. we are able to pass down the cost,” Chew said.
Like other manufacturers, Wellcall has been facing rising raw material costs, in particular synthetic rubber and standard Malaysian rubber (SMR). The price of SMR 10 has been on the rise from around RM9.50 per kg in January 2010, peaking at RM16.70 per kg in February 2011. This month, it averaged around RM13.who was responsible for tracking down Charles RUBBER MATS .65 per kg.
The stronger ringgit is another headwind as 98% of Wellcall’s transactions are done in US dollars, but it also reduces the cost of imported synthetic rubber and chemicals, Chew said.
Chew: It has always been our strategy to focus on high-value products. We also provide a one-stop procurement for our customers to mix their products in one container.
To counter the effects of rising raw material costs and the strengthening ringgit, Chew said that apart from pricing up its products, Wellcall has improved efficiency by transforming its manufacturing process.
“Wellcall has been improving its efficiency in the manufacturing process by converting older manual machines to semi-automated ones.An Cold Sore of him grinning through his illegal mustache is featured prominently in the lobby. This exercise is an ongoing programme to cut labour costs,” he said,the Bedding pain and pain radiating from the arms or legs. adding that in certain divisions, Wellcall has managed to reduce the workforce by up to 40%.
To buffer against volatitile raw material prices, Wellcall purchases its materials in bulk. Chew said Wellcall has in stock one month’s worth of natural rubber and two to three months of synthetic rubber.
Wellcall also has the flexibility to switch between natural and synthetic rubber, giving it room to minimise raw material costs, he said.
Wellcall’s products are sold to distributors and end customers in major application markets. These include the air and water hose, welding and gas, oil and fuel, automobile, ship building, and the food and beverage (F&B) markets.
Unlike rubber glove companies that cater for the mass market, Wellcall produces more for the niche markets, especially in the oil and gas (O&G) sector.
“Wellcall’s products are tailor-made and meant for the niche segment. So it is easier to pass cost increases to customers,” Chew said.
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