The company’s factories and workers’ quarters are at the centre of the Teratai cluster, which has surpassed even the Sri Petaling Tabligh cluster in number of cases.
As of yesterday, the Teratai cluster has logged more than 4,000 cases compared to the tabligh cluster’s 3,375.
The glove maker said yesterday that not all of the cases in the cluster were on its premises.
The cluster was detected on November 2 when a batch of foreign workers were screened preparatory to departure. The discovery of 10 positive cases led to contact tracing.
Top Glove executive chairman Lim Wee Chai said some 7,000 of the 13,000 workforce, both local and migrant, had been screened for Covid-19.
He said about 3,000 of them had tested positive.
The company hostel is under an enhanced movement control order (EMCO) until the end of the month.
Due to the high infection rate among its workers, the Labour Department is launching a probe into factories and hostels.
This is the second time this year the company has come under scrutiny for its workers’ welfare policy, after its products were barred from the US in July over suspicions they were made by forced labour.
The Human Resources Ministry has since cleared the company of such charges, after checking the company premises where it said it found no sign of the abusive practices of which Top Glove was accused.
Side effects
On November 23, the National Security Council ordered 28 Top Glove factories in Klang to close in stages to enable screening of its workers.
Top Glove, in a bourse filing, said it had stopped production in 16 of its 28 facilities and would continue to shutter more in Meru, Klang, since November 18.
The closed facilities will resume operations after the employees are screened and the sites are sanitised, the company added.
The company issued an assurance yesterday that its products are not contaminated and that no orders had been cancelled so far.
Top Glove said the work disruption would delay delivery schedule by about two to four weeks.
It said the stoppage was estimated to cost the company about 3% of next year’s revenue.
In terms of the impact of the 14-day EMCO on production, the shuttered 28 manufacturing facilities in Klang represent about half of its total production capacity.
“As a mitigation measure, the company has rescheduled production plans for non-affected facilities to produce urgent orders,” it added.
Of the 28 factories, 20 are glove production facilities with a combined capacity of 45 billion pieces per year.
The company’s facilities are spread out in various countries as a risk management strategy to ensure business continuity, it said.
AmInvestment Bank said in a research note that Top Glove was “ramping up production outside Klang to meet customers’ demand.
“To reduce reliance on foreign workers, Top Glove has been employing local workers as early as March.”
The company has a workforce of 21,000, more than half of which are migrants.
Founded in 1991, Top Glove commands 26% of the global rubber gloves market share.
The group’s net profit for the financial year ended August 31, 2020 skyrocketed by 412% to RM1.87 billion, from RM364.68 million the year before.
Revenue rose 50.72% to RM7.24 billion from RM4.8 billion.
Bloomberg reported in June the net worth of its founder Lim Wee Chai had more than tripled to US.5 billion (RM10.2 billion).
Top Glove said yesterday it expected a dividend yield of more than 6% for the financial year ending August 31, 2021 due to soaring demand for rubber gloves during a pandemic.
