PENANG, 6 June 2023 - Iconic Worldwide Berhad ("Iconic Worldwide" or "the Group"), a Bursa Malaysia-listed company primarily involved in tourism, property development and the manufacturing of personal protective equipment (PPE), today announced the development of a pipeline of new personal care products under the Iconic Medicare brand, along with new glove products that will deliver enhanced value from an Environmental, Social and Governance (ESG) perspective. Through this initiative, Iconic Worldwide aims to capitalise on a projected revival in consumption, travel and industrial activities, as the world transitions to a post-COVID era.
“We continue to bet on long-term glove demand, which has historically risen in tandem with increased public awareness of personal hygiene and the dangers of infectious diseases, particularly in emerging markets,” said Dato’ Seri Tan Kean Tet, Iconic Worldwide’s Chairman. “As economies re-open and day-to-day activities increase, we expect demand for Iconic Medicare products to accelerate. With the expansion of our glove product range, along with our pipeline of new PPE products, the Group will leverage our established brand presence and manufacturing capabilities to capture this market opportunity.”
Currently, Iconic Medicare products include a range of nitrile and latex gloves and disposable face masks.
“We believe face masks will continue to be a key source of revenue for the Group, as the Iconic Medicare brand is already established with a recognizable presence in the market,” Dato’ Seri Tan Kean Tet said. “Demand for face masks has been sustained in the post-COVID era. Consumers are now well aware of the importance of wearing face masks. It has become the "new normal" for people to wear face masks in public areas.”
Expanding on Iconic’s outlook on the glove manufacturing industry, Dato’ Seri Tan Kean Tet said: “It is well known that today, the glove manufacturing industry has entered a phase of consolidation. In coming quarters, we expect this to lead to an easing of market oversupply. In fact, glove ASPs (average selling prices), which had been declining up until early 2023, appear to be stabilising. At this rate, ASPs are trending towards pre-pandemic levels, which implies glove demand is on a recovery path.
Iconic has made significant investments in automation technology for our glove dipping lines. This will boost the sustainability of our glove production activities, while lowering manufacturing costs. This will drive Iconic Worldwide’s competitive edge as the market recovers.”
In FY2024, Iconic will continue pursuing its strategy of driving growth through a diverse range of businesses. On the property front, Iconic is developing a new commercial and affordable housing project in Alma, Penang. This project involves the development of 751 units of affordable housing and 16 units of commercial shop lots, with an estimated gross development value (GDV) of RM255 million. This project builds on the success of Iconic Point, Iconic Worldwide’s recently-launched commercial development, and will further diversify the Group's real estate portfolio.
For the financial year ended 31 March 2023 ("FY2023"), Iconic Worldwide posted a net loss of RM24.33 million, after writing down the value of its glove inventories.
The impairment, which was made during the financial quarter ending 31 March 2023 ("4Q FY2023"), represented a one-off adjustment amounting to approximately RM17 million. The adjustment was made to account for differences between the initial cost of producing the gloves and masks in its inventories, and the realisable value of those inventories. While the adjustment impacted the value of both inventories, the adjustment was more significant when it came to the Group’s glove inventory.
The initial cost of the Group’s glove inventories was higher to account for cost components including the cost of starting up the new factory, as well as other operating expenses that were needed to bring new products into the market.
Commenting on the Group’s financial performance, Dato’ Seri Tan Kean Tet said: "We remain optimistic about the underlying fundamentals of the glove manufacturing industry. Making this strategic, one-off adjustment will enable the Group to shift its focus towards seizing new business growth opportunities. It is not reflective of our belief in the glove industry's positive outlook, and, as we pointed out earlier, we remain excited about its future growth potential. In addition, we expect the normalisation of raw materials costs to enable the glove manufacturing business to be profitable in the near future.”
