NZ's a2 Milk annual profit rises, positive on FY23 as China demand rebounds
NZ's a2 Milk annual profit rises, positive on FY23 as China demand rebounds Aug 29 (Reuters) - New Zealand's a2 Milk Co on Monday reported a higher-than-expected annual profit and forecast a positive 2023 as the dairy producer benefited from a recovery in demand for its China and English label products. The Auckland-based firm expects high single-digit revenue growth next year, with the first half expected to be significantly higher than second half on the back of "significant growth in sales in 1H23" in China, it said. Earnings of a2 Milk over recent years have been weighed by a hit to its corporate "daigou" channel, as stricter COVID-19 restrictions in its top market China proved difficult for people to ship milk products and sell to their Chinese consumers. However, thanks to a significant increase in marketing, its market share of infant milk formula business in China has been growing.
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Aug 29 (Reuters) - New Zealand's a2 Milk Co on Monday reported a higher-than-expected annual profit and forecast a positive 2023 as the dairy producer benefited from a recovery in demand for its China and English label products.
The Auckland-based firm expects high single-digit revenue growth next year, with the first half expected to be significantly higher than second half on the back of "significant growth in sales in 1H23" in China, it said.
Earnings of a2 Milk over recent years have been weighed by a hit to its corporate "daigou" channel, as stricter COVID-19 restrictions in its top market China proved difficult for people to ship milk products and sell to their Chinese consumers.
However, thanks to a significant increase in marketing, its market share of infant milk formula business in China has been growing.
With full-year results coming in line with its forecast and with a "strong" balance sheet position, the company announced an on-market share buy-back of up to NZ$150 million ($91.91 million).
a2 Milk's China & Other Asia - its major money making segment - recorded a revenue of NZ$726.5 million for the year, an increase by nearly a quarter from a year ago.
The dairy producer reported a net profit of NZ$122.6 million for the 12 months ended June 30, as compared with NZ$80.7 million reported a year ago. That beat a Refinitiv estimate of NZ$114.8 million. ($1 = 1.6321 New Zealand dollars) (Reporting by Jaskiran Singh and Archishma Iyer in Bengaluru; Editing by Sandra Maler)
Konular: China