Milk formula producer A2 Milk reported a strong first-half profit increase, fuelled by double-digit sales growth that supported a higher dividend.
For the six months ended in December, A2 Milk posted key improvements compared to the prior year: net profit rose to $112.1 million from $102.5 million, revenue climbed to $993.5 million from $836.5 million, operating earnings increased to $155 million from $130.9 million, net cash stood at $896.9 million versus $1.01 billion, and the interim dividend lifted to 11.5 cents per share from 8.5 cents.
Infant milk formula sales to China drove a nearly 19% revenue surge, aided by the Pokeno manufacturing plant acquisition and gains in the emerging US market.
“Infant milk formula remains central to our growth strategy and continues to outperform the China market, delivering 13.6% year-on-year revenue growth,” chief executive David Bortolussi said.
“We continue to execute our growth strategy with a focus on maximising opportunities in China infant milk formula, adjacent categories and new markets.”
Bortolussi noted that English-label IMF sales surged significantly via online retail platforms, while the once-crucial daigou channels—third-party sales of A2 IMF—have stabilised.
Fresh milk sales gained traction in Australia and the US, as the company pushes to diversify into new nutritional products.
“Recently launched kids’ and seniors’ nutrition products have accelerated our growth in other nutritionals, strengthening our position in these growing and exciting categories.”
Looking ahead, A2 anticipates double-digit revenue growth, with full-year profit exceeding last year’s $202.9 million.
“Our upgraded outlook means we are now on track to achieve our $2 billion medium-term sales ambition in FY26, a full year ahead of plan,” Bortolussi said.