Friday, March 29, 2024

A2 Milk numbers still soaring

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A2 Milk sales and earnings growth continues at very strong levels, shareholders are being told at the annual meeting in Melbourne today.
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In the first four months of the financial year, to October 31, revenue was $368.4 million, a rise of 40% over last year, operating earnings (Ebitda) rose 58% to $124.2m, pre-tax profits up 60% to $124.9m and after-tax profit up 64% to $86m, managing director Jayne Hrdlicka was to tell them this afternoon Melbourne-time.

It is an excellent result but timing was a factor in the operating earnings and margins are expected to come back to 2018 levels as costs come through. A2 is making significant investment in China and the United States, she said.

The quarterly result followed big gains in last year’s full result in which bottom-line profits and operating cashflows increased by more than 100% and revenues by nearly 70%.

In her notes, Hrdlicka said A2’s fresh milk business continues to gain market share in the core Australia market, reaching 10% of the total fresh milk category, and A2 Platinum infant formula is the market leader with a 33% share.

Momentum continues to build in China with store numbers up by 2000 to 12,000 on top of e-commerce sales. Total sales there were up by 75% over the four months.

The A2 milk business in the United States is also developing with store numbers up by 3000 to 9000 offering product. 

There has been significant investment in brand promotion and research indicates the US business is looking like the group’s earlier experience developing the Australia market. 

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