Published by Edge Prop | 13 Jan 2021
An artist impression of the glove production building (Pic by Aspen)
PETALING JAYA (Jan 13): Penang-based developer Aspen Group Holdings Ltd has secured a sales and distribution agreement valued US$100 million (RM403.75 million) for its glove production business this year, said the company.
In a media statement today, Aspen Glove Sdn Bhd (AGSB), a subsidiary of Aspen Group, said the agreement was signed with a distributor for the offtake of its entire 2021 production, estimated to be approximately 1 billion pieces of nitrile medical grade examination gloves or natural rubber medical grade examination gloves to be produced from May to December this year.
The company added that the gloves will be distributed on an original equipment manufacturing (OEM) basis to the European and US markets with the required licences being in place for the sale and distribution.
Aspen Group president and CEO Datuk M. Murly said the agreement will also allow AGSB to penetrate the EU and US markets.
With the secured deal, AGSB could focus on accelerating the expansion plan under Phase 1b to include an additional six lines, whose production is now expected to commence progressively from Q3 2021 onwards and to also bring forward Phase 2 for another 12 lines, to commence progressively from Q2 2022 onwards.
“With this sales of USD$100 million and acceleration of the additional 18 lines in 2021 and 2022, AGSB is expected to contribute significantly to the growth in revenue and profit of the group for the financial year ending Dec 31, 2021,” he added.
Subsequently, construction of the superstructure for the production building of the manufacturing facility and the glove dipping machineries are underway and expected to complete by March 31, 2021. Production trial commencement is expected from Apr 1, 2021 and full operation by May 1, 2021.
Despite the imposed 14-day Movement Control Order commencing from Jan 13 to Jan 26, 2021, work is expected to go on as scheduled as the glove manufacturing facilities are deemed as essential services.