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A2 Milk Ltd (ASX: A2M) was founded in New Zealand that has now expanded in Australia, China and the United States (US). A2 Milk specialise in milk products, specifically, the brand called A2 Milk. A2 Milk is different from conventional cows’ milk because it comes from cows selected to naturally produce only the A2 protein type and no A1 protein. A2 Milk has a market capitalisation of A$8.8 billion.
What has happened to the share price?
A2 Milk is currently trading at A$13.32 and is up around 10% today.
What is the cause of the sharp increase in the share price?
A2 Milk had its AGM today. The main take away from the AGM is that A2 Milk upgraded its full-year outlook on the back of strong growth in China and the US markets.
A2 Milk management noted the following:
Overall, for FY20 we anticipate continued strong revenue growth across our key regions supported by brand and marketing investment in China and the US and the development of both capability and infrastructure to support in-market execution.
A2 Milk management noted that for 1H20 it is anticipated that revenue should be in the range of A$780 – A$800 million. Additionally, EBITDA margin in 1H20 is expected to be higher than FY20 and in the range of 31-32%.
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This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978)
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