STGT Q2 2025 Financial Results Analysis
Sri Trang Gloves (Thailand) Public Company Limited (STGT), a global leader in the production of medical and industrial gloves, faced a challenging Q2 2025 amid increased competition and policy changes. This article dissects STGT’s latest financial results, key metrics, strategic actions, and outlook, providing investors with a clear picture of the company’s current position and future trajectory.
Key Financial Metrics and Performance Overview
| Metric | Q2 2025 | Q1 2025 | Q2 2024 | YoY Change | QoQ Change |
|---|---|---|---|---|---|
| Sales Volume (million pcs.) | 9,091.1 | 9,191.2 | 8,429.2 | +7.9% | -1.1% |
| Sales Revenue (THB million) | 5,997.2 | 6,545.8 | 5,735.6 | +4.6% | -8.4% |
| COGS (THB million) | 5,479.2 | 5,696.5 | 4,962.0 | +10.4% | -3.8% |
| Gross Profit (THB million) | 518.0 | 849.3 | 773.6 | -33.0% | -39.0% |
| Net Profit (THB million) | 77.1 | 424.2 | 378.4 | -79.6% | -81.8% |
| EBITDA (THB million) | 752.8 | 1,093.2 | 985.4 | -23.6% | -31.1% |
| Gross Profit Margin | 8.6% | 13.0% | 13.5% | -4.9 pp | -4.4 pp |
| Net Profit Margin | 1.3% | 6.5% | 6.6% | -5.3 pp | -5.2 pp |
| Current Ratio | 2.07 | 2.24 | 2.32 | -10.9% | -7.6% |
| Cash Cycle (days) | 58.38 | 53.47 | 54.71 | +6.7% | +9.2% |
| Net IBD/E | 0.06 | 0.03 | 0.04 | +65.7% | +113.0% |
| Interest Coverage Ratio | 11.74 | 16.76 | 13.45 | -12.7% | -30.0% |
Historical Performance Trends
- Net profit sharply declined both YoY and QoQ, reflecting an extremely competitive market and tariff-related disruptions in the US.
- Sales volume climbed YoY (+7.9%) due to global demand recovery, but slipped slightly QoQ (-1.1%) due to US customers adopting a wait-and-see approach on tariffs.
- Gross and EBITDA margins contracted as average selling price (ASP) fell more than costs, with THB appreciation further impacting USD-denominated revenue.
- Cash cycle lengthened, driven by higher Days Sales Outstanding and Inventory Outstanding, indicating slower collections and inventory turnover.
Exceptional Earnings and Expenses
- Exchange rate loss: The company reported a net exchange loss of THB 112.8 million in Q2 2025, a sharp reversal from a modest loss in Q1 2025 and a gain in Q2 2024. This was primarily due to the strengthening THB against the USD.
- Other gains: The company recorded a notable other gain of THB 100.9 million in Q2 2025, compared to a loss in the prior periods. The report does not elaborate on the nature of this gain.
Financial Position and Fund Flows
- Total assets stood at THB 48,101.2 million, down 1.7% from the end of 2024 due to lower cash and depreciation of plant and equipment.
- Total liabilities decreased by 10.3% to THB 9,330.7 million, reflecting repayment of both short- and long-term loans.
- Net cash at period-end was THB 1,611.9 million, down THB 2,293.5 million, driven by investments in fixed deposits, capex, dividend payments, and loan repayments, partially offset by new borrowings.
Business Strategy and Outlook
- STGT is leveraging its flexible production lines and Thailand-based access to high-quality natural rubber latex to maintain competitiveness.
- The company is investing in automation and exploring AI to reduce costs and improve efficiency, with projects underway for defect detection and smart energy management.
- Specialty gloves production is being ramped up to meet specific demand (over 85 types), including products for medical and industrial use.
- The customer base is targeted to grow from 175 to over 190 countries within two years, aiming for greater revenue diversification.
- Sustainability remains central, with initiatives in circular economy, solar energy, and greenhouse gas reduction (targeting 20% reduction by 2029 and Net Zero by 2050).
Corporate Governance and Awards
- STGT received two awards at the ASEAN Corporate Governance Conference and Awards 2025, including Top 50 ASEAN PLCs and the ASEAN Asset Class PLCs distinction, underscoring its commitment to best practices in governance.
- The company was included in S&P Global’s Sustainability Yearbook 2025 for the second consecutive year, recognized for its focus on human rights, occupational safety, and employee development.
Events Impacting Performance
- The announcement of US reciprocal tariffs led to increased price competition and deferred orders from US clients, significantly impacting ASP, sales, and profitability.
- No mention of natural disasters, legal disputes, or asset revaluations.
- No details provided on share buybacks, placements, IPOs, fundraising, or related-party transactions.
Conclusion: Performance and Outlook
STGT’s Q2 2025 financials reflect a weak short-term performance due to policy-driven market disruptions, fierce competition, and currency headwinds. Despite lower profitability, the company remains financially robust with healthy liquidity and manageable debt, and is actively investing in technology and sustainability. The strategic emphasis on specialty products, global expansion, and ESG leadership positions STGT for recovery and long-term growth as market conditions stabilize. Investors should note the normalization period in the glove industry and monitor progress on cost controls, automation, and tariff developments for future upside.
