- Riverstone's 2Q25 core profit contracted 39% y-o-y to MYR44m, taking 1H25 numbers to account for 38% and 37% of our and Street’s forecasts.
- Results were below expectations on an unfavourable FX and product mix, and production disruptions due to gas supply rationalisation.
Results overview.
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- an unfavourable product mix (higher sales contributions from healthcare generic gloves), and
- supply disruptions due to temporary natural gas supply rationing.
- Gross margin dipped 12ppts y-o-y to 29.1% due to the abovementioned factors, coupled with an unfavourable product sales mix, i.e. a cleanroom and healthcare mix of 16% and 84% vs 20% and 80% previously. The 2-month gas supply disruption that impacted Riverstone affected less than 5% of its 10bn total annual capacity. Management is confident of filling the gap by July when gas supply is set to normalise.
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Outlook.
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