VIP Gloves production will not be affected by Malaysia’s 14-day total lockdown

VIP Gloves Ltd (ASX:VIP) accelerated production of nitrile gloves in Malaysia will continue unabated despite a total lockdown in the country for 14 days from June 1 due to escalating COVID-19 cases. During this period, and any subsequent extension, all economic and social sectors are unable to operate except selected essential economic and service sectors approved by the Malaysian National Security Council. Essential sector Production of nitrile gloves will not be impacted as this is among the ‘essential sectors’ allowed to continue operations. VIP group managing director Jimmy Yang said: “We would like to assure the investing public that our production remains unaffected during this period and we remain confident to meet our monthly production and sales targets. “With sales orders continuing to rise, we are eagerly looking forward to the planned completion of Production Lines 7 & 8 in the next few months to meet the continued demand for our nitrile gloves,” he added. Management will adhere to strict Standard Operating Procedures (SOP) imposed by the Malaysian Ministry of Health, with certain non-essential office personnel practising the ‘work from home’ directive. The health and welfare of staff and workers remain top priority for the company. VIP’s Malaysian subsidiary companies manufacture nitrile disposable gloves from a plant in Selangor, Malaysia. Nitrile gloves can be used in the medical, health, dental and numerous other industrial and commercial sectors. Buoyed by Ansell performance The company is encouraged by the ongoing strong performance of major global personal protective equipment (PPE) manufacturer and supplier Ansell Limited (ASX:ANN) as the COVID-19 pandemic triggers strong demand. With increased demand for single-use medical gloves and protective medical suits, Ansell has been a major beneficiary with its share price increasing almost 30% since late last year to beyond $43. Demand is forecast to remain strong until 2022 and Ansell is in line for a strong result in FY21 while post-COVID market fundamentals are tipped to be stronger owing to increased awareness of the need to maintain personal hygiene. Ansell’s guidance for earnings per share now stands at US192-202 cents and this range implies 54-68% growth in the second half of FY21, according to Credit Suisse.