Riverstone Holdings net profits up 22.4% to $127m in FY14

Due to higher glove demand and higher tax incentives.

It was a stellar year for Riverstone, and the good news might keep on coming as the company pushes with its expansion plans this year.

According to a report by OSK-DMG, Riverstone reported stellar FY14 results, beating analysts’ earnings estimate by 4.7% on higher glove demand, margin expansion for the cleanroom segment, and higher tax incentives from the Government.

Going forward, OSK-DMG remains bullish on Riverstone as its expansion plans are on track, while its 1bn capacity has been fully taken up.

In addition, demand for its cleanroom gloves is still strong.

Riverstone’s FY14 revenue grew 11.6% to MYR399.3m while its NPAT rose 22.4% to MYR71m, mainly due to higher glove demand as well as higher tax incentives from the Government given its expansion plans.

FY14 has been another exceptional year for Riverstone, with its earnings beating expectations by 4.7%.

Analysts believe a strong uptake in the mobile tablet section will be the main growth driver for its cleanroom segment. As of 4Q14, it accounted for 30% of total volume of cleanroom gloves that Riverstone produced. Going forward, analysts expect a further 15- 18% growth from this high-margin segment.

Phase 1 of Riverstone’s production ramp-up for its new Taiping plant has been completed, with full capacity now raised to 4.2bn. Phase 2, which costs MYR50m and will add another 1bn capacity, is expected to be completed by the end of FY15.