Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

A2 CEO, chair sell down holdings following strong first-half

Wednesday 22 February 2017 01:59 PM

A2 CEO, chair sell down holdings following strong first-half earnings

By Sophie Boot

Feb. 22 (BusinessDesk) - A2 Milk Co's chief executive and chair have sold down their stakes in the milk marketing firm, less than a week after reporting first-half profit more than tripled as demand for its A2 Platinum infant formula surged in its key Australia, New Zealand and China businesses.

Chair David Hearn sold 1 million shares for about $2.5 million, or $2.48 a share, on Friday, while chief executive Geoffrey Babidge sold 900,000 shares for $2.2 million, or an average price of $2.49, yesterday. Hearn gained the shares by exercising 1 million of his 5 million options, for which he paid $630,000, with the sale to facilitate a property transaction in the UK to move his personal residence, according to documents published to the NZX.

Last week, the milk marketer reported net profit soared to $39.4 million in the six months ended Dec. 31, 2016, from $10.1 million in the year-earlier period, while revenue rose 84 percent to $256.1 million.

The shares, which are notoriously volatile, had rallied to a record $2.60 in the lead-up to earnings being reported, slipped 1 cent to $2.57 after the results, and have continued to decline since. They traded at $2.51 on Friday, when Hearn sold his shares, $2.44 yesterday, and are down 4.1 percent to $2.34 today.

A2's shares have bounced around in the past quarter, dragged down from a then-record $2.58 in December when ASX-listed rival Bellamy's was put in a trading halt, causing investors concern that there might be sector-wide issues. It continued to struggle until mid-January when A2 quelled concerns about its earnings outlook and Bellamy's cut its profit forecast for the second time and announced its chief executive's exit. Bellamy's ran into trouble after China moved to tighten regulations in a bid to crack down on the grey market - or 'daigou' - sales and allay concerns about food safety.

In the first half, A2 posted strong growth from China, with revenue rising to $37.7 million from $8.4 million a year earlier, and operating earnings before interest, tax, depreciation and amortisation rising to $13.7 million from $1.3 million in 2016. The company says it has a considerable growth opportunity in China and is using multiple channels, including cross-border e-retailers, to sell into that market, while monitoring Chinese regulation of infant formula and cross-border trade.

(BusinessDesk)


© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Frog Recruitment: Kiwi Workers Reluctant To Make Business Trips Across The Ditch Despite Trans-Tasman Bubble Opening

When the trans-Tasman travel bubble opens today, many Kiwi companies won't be rushing to buy an air ticket, reluctant to cross the ditch to do business. The latest survey conducted by leading recruitment agency, Frog Recruitment of nearly 1,000 New Zealand ... More>>

Tourism: Employers Welcome Back Working Holidaymakers

Tourism businesses gearing up for the return of Australian visitors from next week will be relieved to learn that they will also have access to an offshore pool of much-needed job candidates, Tourism Industry Aotearoa says. Tourism employers around ... More>>

Commerce Commission: Latest Broadband Report Confirms Improved Performance Of Premium Fibre Plans

The latest report from the Commerce Commission’s Measuring Broadband New Zealand programme shows that the performance of Fibre Max plans has improved substantially. This follows a collaboration between the Commission, its independent testing partner, ... More>>

Air New Zealand: Capital Raise Deferred

Air New Zealand has decided to defer its planned capital raise to later in 2021 allowing more time to assess the impacts of recent developments on the airline’s path to recovery. 'We’ve seen some clearing of COVID-19 clouds recently, with ... More>>


Stats NZ: Prices For Transport And Housing Rise In March 2021 Quarter

Higher prices for transport and housing led to a 0.8 percent lift in the consumers price index in the March 2021 quarter, Stats NZ said today. Prices for getting around rose in the March quarter. Transport prices rose 3.9 percent, the biggest quarterly ... More>>

Stats NZ: New Report Shows Impact Of Demands On Land In New Zealand

A new environmental report released today by the Ministry for the Environment and Stats NZ, presents new data on New Zealand’s land cover, soil quality, and land fragmentation. The land cover data in the report, Our land 2021 , provides the most ... More>>

ALSO:

Stats NZ: March Card Spending Rebounds Despite COVID

There was a lift in retail card spending in March following a fall in the lockdown-disrupted February month, Stats NZ said today. Seasonally adjusted retail card spending rose by $53 million (0.9 percent), compared with February 2021. Visit our website to read ... More>>