A2 Milk Company has seen significant growth in the last decade. A2 Milk company products include Fresh Milk Brand known “a2 Milk” and they also have premium infant milk formula names “a2 Platinum”. A2 Milk Company claims that they produce the products which are free of A1 protein. A1 protein causes adverse effects on the stomach, especially if a person is lactose intolerant then A1 protein can cause bloating or in some cases, diarrhea.
A2 milk company financial performance is also impressive for two years in a row. The company has marked double-figure growth in terms of revenues and earnings in the last two year. These impressive results also reflect in the A2 milk share price. The share prices have soared in the last year up which results in significant earning for shareholders.
In the Australian Stock Exchange (ASX), the price is of A2 Milk share price is AUD 13.85 as of 28th June 2019. At the start of the year 2019, the A2 milk share price was AUD 10.50 on 2nd January 2019. After the results of the FY 2018 published, the share price has seen a remarkable increase up to AUD 15.96 till 20th April 2019. After April 2019, the share price has come across a slight downward trend and the midyear closing price for a share is AUD 13.85. The Financial highlights of the FY 2018 is noteworthy like
- Total Revenue of A2 Milk is $ 922.7 million; 68% increase over the prior corresponding period i.e. the FY 2017
- EBITDA (Earnings before interest, tax, depreciation, and amortization) of $ 283 million; 101% increase on the prior corresponding period
- EBITDA to Sales Margin is 30.7% million. An increase of 25.7%
- Net Profit after Taxation is 195.7 Million; An increase of 116% from the previous period
- Basic Earnings per Share (EPS) is 27.0 cents per share; EPS for the previous period was 12.7 cents per share
- Operating cash flow is $231.1 million; A hike of 131% from previous results
These are the financial performance highlights, showing the growth trajectory of the company’s products
The other significant market indicators are as follows;
- 32% share in infant nutrition in Australia and a 5% share in the same category for China
- Product availability in 16,000 stores across China and USA
- 8.5% of revenue invest in Research & development, marketing, and intellectual property
The financial numbers and market presence of A2 milk products showing an astonishing increase of customer base in multiples countries. The investment in intellectual property is paying off and people are recognizing the importance of milk formula offered by A2 (i.e. A1 protein-free Milk). This gave A2 first-mover advantage and they are dominating the category. The result of First Half of the FY 2019 is also promising and A2 has witnessed the growth of 42%. This shows the customer’s confidence in the product’s quality and exclusivity.
Following these financial numbers and customer trust in the brands. A2 share price seems to be a profitable venture for their existing or new shareholders.