1 Market Reach Growing Global and Overseas Operations Export to - PDF document

Growing Global ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality Growing Global • Established in year 1988 • Manufacturer of rubber examination gloves • 100% export to US, EU, Japan, Australia, China, India • World’s largest nitrile glove producer since 2011 • 6 manufacturing facilities located in Selangor, Malaysia • Installed glove production capacity of 16 bil per annum • Workforce of 5,100 • Sales exceeding RM1.1 billion per annum (FY2015) • Listed on Bursa Malaysia since 2008 • Market capitalization of RM7-8 billion • 10 years sales revenue CAGR of 26% • 10 years profit CAGR of 32% • Most profitable glove manufacturer in the world ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 1

Market Reach Growing Global and Overseas Operations Export to over 40 countries Four overseas offices • Australia (1996) • USA (2003) • China (2012) • India (2013) ……………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 3 Market Segments Growing Global Others, Lab, 17% 8% Asia Pacific, 14% Industrial, 2% Food, 5% USA, 48% Europe, 30% Healthcare, 76% � Products mainly sold to quality demanding markets such as USA, Japan and Germany � 93% of sales to healthcare and lab industries where demand remain robust ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 2

Global Recognition Growing Global 2013 & 2014 2010, 2011, 2012 & 2013 2013, 2014 & 2015 2010 & 2012 Forbes Asia 200 Best HR Asia Best The Edge Billion Asiamoney Best Under a Billion Employers to Work for Ringgit Club – Most Managed Company in in Asia Profitable Company in Malaysia Industrial Products Segment ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 5 Revenue and Profit Growing Global Revenue (RM mil) 1,145 1,107 1,032 CAGR for revenue from FY2005 to FY2015 of 921 26% 735 572 443 CAGR for PAT from FY2005 to FY2015 of 32% 110 160 240 282 Net margin improved from 12% in FY2005 to 21% in FY2014 but declined to 18.3% for FY15 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 Sales and PAT for FY2015 of RM1145 mil and RM210 mil respectively Profit After Tax (RM mil) 234 234 210 FY2015 EPS of 27 cents 190 201 146 FY15 lower than FY14 due to NGC high start up cost 85 37 40 Highest profit margin in the industry 19 13 Highest net profit in the industry FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 6 3

Highest output with lowest number of workers Growing Global Hartalega’s existing setup 3.9 Average of listed glove companies in Malaysia (ex-Hartalega) 4.7 Sector average 7.5 Hartalega’s existing facilities are 48% higher in productivity compared to industry average Compared to top listed glove companies, Hartalega is 17% higher in productivity Higher productivity is achieved through innovative technologies *unit measurement used is worker per million pieces of gloves produced per month *sector average and listed companies figures from news releases and company’s quarterly and annual reports ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 7 Fastest Production Rates Growing Global 28,000 30,000 45,000 35,000 40,000 20,000 10,800 20,000 10,000 - - Industry fastest Hartalega Industry Hartalega fastest average average Intensified competition Average production line speed (pcs/hr/line) Fastest production line speed (pcs/hr/line) � Hartalega’s average production line speed is 60% higher than industry average � Comparing to fastest production lines in the industry, Hartalega’s most advanced production line is 12% higher in rate of output � All production technologies are in-house developed and proprietary to Hartalega ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 8 4

Most Profitable & Highest Profit Margin Growing Global Industry average profit before tax Hartalega profit before tax 33% 33% 31% 30% 28% 28% 24% 22% 17% 17% 16% 15% 15% 15% 12% 12% 11% 11% 10% 10% 9% 8% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 * Industry average is the average profit margin of top 3 listed glove manufacturers in Malaysia ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 9 Sector leader Growing Global 5,285 5,560 3,542 1,629 1,782 1,263 341 2008 2009 2010 2011 2012 2013 2014 World‘s largest nitrile glove Highest Productivity in the Industry. Most Innovative Glove Company. manufacturer. World‘s fatest production line at Several breakthrough inventions Valuable Glove Company in 45,000 pcs/hr. that changed the landscape of Malaysia (current market cap of Most advanced in-house developed glove industry. over RM8 billion) production technologies. ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 10 5

Sector leader Growing Global 30.00% 5-yr avg net 4-yr CAGR margin 25.00% Hartalega 18.0 23.3 Kossan 11.7 9.3 20.00% Net Hartalega Supermax 8.8 13.2 Margin 15.00% Top Glove 10.9 9.3 10.00% Supermax Top 5.00% Kossan Grove 0.00% 5.00% 10.00% 15.00% 20.00% CAGR Source: Deloitte & Touche, 2014 ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 11 What are our competitors doing? Growing Global Nitrile glove business Production technology Product innovation � � � NR:NBR ratio for global Competitors claim to have Competitors seek to glove market is 50:50 45,000 pcs/hr lines differentiate themselves in � � terms of product offerings All glove producers want a Competitor investing in � bigger share of nitrile glove 35,000 pcs/hr lines SilkSkin sericin glove market � � Competitor investing in IT Accelerator free glove � All new capacities are � All big glove companies nitrile gloves already have stripping machines ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 12 6

Our enemies have arrived! Are we ready? Growing Global ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 13 Growing Global OUR STRATEGY ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 14 7

Four pillars of growth Growing Global Innovation Human Resource Production technologies Engaging critical mass Product innovations Knowledge management Innovative culture at all levels Competencies development Succession planning Own Brand Productivity Develop own brand market Capacity expansion (NGC) Emerging markets like China Lean manufacturing and India as target markets Invest in Information Technology Vision to build a global multiple medical device company ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 15 Talent development Growing Global Senior Leadership development program Management by Management Skills development and lean Executives, Supervisors manufacturing (critical mass) ………………………………………………………………………………………………………………………………………………………………………………….. Innovation Quality 16 8