A2 Milk Share Price Continues to Increase

Shares ofa2 Milk Company Ltd [ASX:A2M] have shot up a further 2.96% today.

And with a 52-week change of 183.25%, this dairy brand is clearly no stranger to growth.

Thus far in 2018, a2 Milk has reported strong revenue and earnings in numerous sectors — including producing, marking and selling dairy and infant formula products. Further, a2’s efforts to target global markets are opening new avenues for growth for the company.

Why a2 Milk shares continue to climb

Sales of their Platinum Infant Formula have been exceptional in both Australian and Chinese markets.

A2 products turned over a huge sales revenue of $341 million, which equates to 78% of the company’s half-year revenue.

This is helping a2’s market share expand across the Asia-Pacific region.

But these aren’t the only markets displaying outstanding sales results.

Group marketing investments have increased by $10 million, due to company fundamentals and programs being supported across the US and China.

In their interim report, a2 Milk stated:

Significant progress was achieved in the United States, with further growth in brand awareness, sales velocities and store numbers within the established footprint of California and the Southeast. The US business also further expanded geographically, culminating in the announcement in January 2018 that the a2 Milk™ brand would become available through major retailers across the Northeast region.

The future for a2

In the meantime, a2 have continued to build brand awareness across all its sectors while focusing on various forms of consumer engagement.

Distribution of a2 Platinum has expanded, making it available across multiple channels whilst also adapting to requirements in China.

Thanks to further investments and sales growth, a2’s cash position has steadily improved alongside its revenue growth and earnings.

They will continue to invest in protein expertise, as well as emphasise and adopt this new market approach to branch out to new customers.


Ryan Clarkson-Ledward,
For Money Morning

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Ryan Clarkson-Ledward is an Editor at Money Morning.

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