The a2 Milk Company today posted a full year profit of $NZ30.44 million, overturning a $NZ2.1 million loss in 2015, on strong sales of its Platinum infant formula in China.
Total revenue for the ASX-listed New Zealand company was up 127.4% to $352.8 million, in line with the latest guidance, but the company decided against declaring a dividend.
China sales grew to $NZ38.2 million from $NZ4 million.
Sales of a2 Platinum infant formula in Australia, New Zealand and China were up 414% to $NZ214.4 million.
a2 shares last traded on the ASX at $A2.19, up from a 12 month low of 60 cents.
Managing director Geoffrey Babidge says the demand for infant formula created challenges in balancing supply, production and logistics.
“These have been met in conjunction with our manufacturing partner Synlait Milk Limited, and with an expansion of milk supply from affiliated farms in New Zealand,” he says.
The company says it maintains a strong focus on understanding and adapting to changes in the regulatory environment for infant formula products in China.
“The company considers itself well placed to respond to other potential changes over time,” he says.