Friday, March 29, 2024

Stellar results for A2

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A2 Milk Co has had another stellar half year of trading, with revenues up 70% and bottom-line profit up 150%.
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Revenues for the six months ended December 31 were $434.7, including $341m for sales of A2 Platinum infant formula.
The after-tax profit was $98.47m, up from $39.38m for the same period a year earlier.
Strong growth is still being achieved in Australia and China and good growth in fresh milk sales in the United States and United Kingdom, chief executive Geoff Babidge said. 
With expansion into the northeast of the US, the group will grow its presence to 5000 stores in that country, up from 3600 at balance date.
The half-year earnings exceeded the $90.6m made in the full June 2017 year.
Operating cashflow jumped out to $116.4m for the period, up from $38m.
At balance date, the company had $240m in cash on hand and was still considering an on-market share buyback and paying dividends. 
The growth in cashflow came despite a $25m lift in A2 Platinum inventory levels to allow for the new regulatory regime in China and increased sales growth, Babidge said. 
Inventories totalled $53.6m at balance date.
A2 Milk Co finished the period with $547m in assets, up from $344m, and had an equity ratio of 71% and no borrowings.
The A2 Platinum supply arrangement with Synlait Milk in Canterbury was working very well, he said.
A2 remained committed to its low-capital operating model but was considering possible ownership, either in full or in partnership, of blending and canning assets as part of its “multi-site, multi-product and geographic diversification strategy”.

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