A2 Milk shares are approaching a 52-week high after the infant formula and dairy business reported a strong first half and subsequently upgraded its full-year outlook, driven by robust demand in China. A2 Milk is known for its A2 protein-based milk products, which it markets as easier to digest than conventional milk. The company focuses on infant formula and fresh milk products.
First-half net profit reached $NZ112 million ($96 million), surpassing consensus estimates by 7 per cent and Citi estimates by 11 per cent. Underlying profit received a boost from lower-than-expected supply chain losses. English label products experienced growth of 13.6 per cent, while Chinese label products grew 6.5 per cent. A2’s HMO product, Genesis, demonstrated strong month-on-month sales, indicating future potential.
Citi analyst Sam Teeger described the group’s conference call as “quite positive,” noting several growth drivers, including market share gains, new product launches in China, and expansion into Vietnam. Shares were last up 8 per cent. Teeger added, “The better-than-expected result and upgraded guidance support our recent trip feedback, where we concluded that execution for our top pick in F&B remains strong.”
