🧐 ProPicks AI October update is out now! See which stocks made the listPick Stocks with AI

UPDATE 1-A2 Milk sees infant formula sales above expectations, fuelled by China

Published 26/04/2017, 07:09 am
© Reuters.  UPDATE 1-A2 Milk sees infant formula sales above expectations, fuelled by China
BAL
-

(Adds director comment, detail)

WELLINGTON, April 26 (Reuters) - New Zealand milk company A2 Milk ATM.NZ said on Tuesday it was seeing unexpectedly high demand for its infant formula via Chinese e-commerce and now expected higher sales in the six months to June than the previous half-year period.

The company said in a statement to the stock exchange that it was forecasting revenue for the 12 months ending June at around NZ$525 million ($364.67 million), after posting revenue of NZ$388.5 million in the nine months to April.

"Demand has been particularly strong in Australia, but also through the cross border e-commerce (CBEC) channel into China," said A2's managing director Geoffrey Babidge.

Many of its Australian sales end up in China through personal shoppers known as "daigou" who post Australasian products to Asian consumers.

The dairy company had originally predicted in February that second-half sales in the 2017 year would fall from the first half because of the timing of major sales events in China which weighted demand in favour of the first half of the year.

The company said it was now working with dairy producer Synlait Milk SML.NZ to lift its production in the second half to meet the increased demand.

By contrast, rival Australian infant formula maker Bellamy's BAL.AX , has been struggling with waning sales to China, which it said was due to a supply glut due to regulatory changes, and its shares have fallen more than 60 percent so far this year. ($1 = 1.4397 New Zealand dollars)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.