The A2 Milk Company says it's on track to reap higher revenue than expected in 2016 thanks to rising demand for its infant formula.
The company said yesterday that the first four months' trading performance for infant formula in ANZ and China were well ahead of plan, and as a result it was issuing a revised earnings guidance for the 2016 financial year.
The company is now forecasting Group revenue of $NZ285 million, up from $267 million, and operating EBITDA of $NZ22 million, up from $12 million.
In an update to shareholders, the company also said that it had received 60,000 visitors to the Chinese Tmall online store in its first four weeks of trading.
A2 Milk also said it had seen sales of its a2 Platinum infant formula rise 445 per cent over the 2015 financial year.
The announcement follows reports of strong demand for a2 and organic baby formula in China, which has in turn created a shortage on Australian supermarket shelves.
Consumer advocacy group Choice responded to the shortage by calling on the Federal Government to guarantee the supply of infant formula for children under the age of one.
Choice's Kate Browne said: “We need to collect national information about the shortages and find out exactly where and why they are happening. We’ll use any insights to help strengthen our hypothesis that the government and retailers need to act to ensure parents and carers have access to a reliable formula supply.
Choice is also calling on parents to report shortages at retailers across the country at choice.com.au/babyformula.
A2 Milk said Platinum sales now account for 47 per cent of its revenue. The company, meanwhile, continues to expand its product portfolio with a2 Ice Cream launching into one Australian retailer in August, with a second recently agreeing to stock the product.
