Condoms maker Karex builds RM80 mln Pontian plant

by **Cals** Sat 15 Mar 2014, 00:56

Business & Markets 2014

Written by Bernama

Friday, 14 March 2014 14:17

KUALA LUMPUR (Mar 14): Homegrown condom manufacturer, Karex Bhd, is spending about RM80 million to build a new factory in Pontian as part of its expansion plan.

The company has factories in Port Klang and Hat Yai in Thailand.

CEO Goh Miah Kiat said the new factory, to be built on a 7.28-hectare site, is slated for completion by year-end.

He said rising awareness of the importance of condom use and growing global population were driving demand for condoms going forward.

Last year, a total of 22.8 billion pieces of condoms were sold, he said, adding that this remarkable number showed demand was growing.

The group has a combined production capacity of four billion condoms currently.

"We target to achieve a production capacity of six billion pieces by end-2015," Goh told Bernama after the company's extraordinary general meeting.

He said Karex, which has a 10 per cent share in the global condom market, is expected to show good growth this year.

Karex Bhd reported a pre-tax profit of RM14.94 million and a revenue of RM82.2 million in the second quarter ended Dec 31, 2013.

The strong financial performance was bolstered by higher volume of condom sales achieved as a result of the completion of newly installed capacity in its manufacturing plants, he said.

Goh said maintaining the competitive price for condoms would be the main challenge faced by the group as production cost was increasing.

As Karex's products are exported to over 110 countries, Goh said the group was eager to expand its own brand manufacturing.

For the six-month ended Dec 31, 2013, Karex posted a pre-tax profit of RM27.37 million from RM17.96 million in the same period last year, whilst the revenue rose to RM147.58 million against RM118.69 million previously.