A2 Milk for a record result after a sharp rise in sales

A2 Milk appears to be on track for another record annual net profit next month after announcing a 68% increase in revenue in 2017/18.

The largest New Zealand company by market capitalization for the year of June, it amounted to about $ 922 million, or just over $ 900 to $ 920 million, against $ 549.5 million a year earlier.

Update confirms net profit of $ 188 million For the future, the beta protein milk business has announced that it had completed its planning cycle for the 39, year 2019 and that, assuming that the general conditions of sale do not change the marketing expenses, as a percentage of sales, are higher than those of 2018 because of the continuous investments in Australia, relabeling activities During the In the second half of the year, investment in China increased and investment increased to support expansion in the United States.

Overhead costs would be higher next year due to the increase in the workforce. Jayne Hrdlicka, who started this role on Monday

Analysts said the update of the company's financial performance involved little cost. In addition, the outlook for 2018/19 seemed a little blurry, which may explain the volatility of the stock price over the course of the day, the stock exchange trading between $ 11.34 and 11 , $ 80 before ending at Daniel Kieser, general manager of Shareclarity, said the earnings outlook was not as clear as previous guidance statements.

"So it was not surprising to see it (the price of the stock)), I think investors began to be interested in the offer – from Synlait and Fonterra – and realized that expected income growth is probably not different from what they previously thought, "he said. Shane Solly, Portfolio Manager at Assert Management, said that the 30 percent margin revealed in the update was good, but that it was perhaps lower than what anyone had expected.

Mark Lister, Head of Private Wealth Research at Craigs Investment Partners, said revenue growth of 68% was exceptional for any business, but uncertainty lay in maintaining the trajectory of extraordinary growth of Milk. [19659002] Even at the price of today – which was more than double that of a year ago – reflected high expectations for future profits.

Bloomberg's consensus on market expectations for the A2 result is a net profit of $ 188 million for 2017-2018, rising to $ 273 million in 2018/19 and $ 350 million in 2019/2020.

"It all depends on the ability to achieve this profit growth that the following years," said Lister.

"This is not highly valued when it can deliver."