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February 25, 2021

Fundamentals remain strong despite significant COVID-19 disruption

Result overview for the half year ended 31 December 2020 (NZ$)1,2,3

• Total revenue of $677.4 million was down 16.0% and EBITDA of $178.5 million was down 32.2% resulting in EBITDA margin of 26.4% (27.0% excluding Mataura Valley Milk acquisition costs)
• Challenges resulting from COVID-19 disruption experienced in the daigou/reseller channel with a flow on impact to the cross-border e-commerce (CBEC) channel – steps taken to re-activate these channels
• Strong performance in China label infant nutrition, with revenue growth of 45.2%, an increase in market value share to 2.4%4, increasing in-store velocities as well as increasing distribution to 22.0k mother and baby stores (MBS)
• Solid performance in liquid milk in Australia with 16.3% revenue growth driven by higher levels of in-home consumption and a record value share of 11.7%5
• Changes in USA execution approach resulted in revenue growth of 22.3%, higher average velocities in key stores, distribution increasing to 22.3k stores and an improvement in EBITDA
• Continued strong investment behind the brand with $67.4 million of marketing investment in the half, building on record investment in 2H20 and supporting strong brand health metrics in key markets
• Responded to challenges by appropriately managing discretionary costs while continuing important capability investment in people, technology and infrastructure
• Finalised binding agreements for the proposed acquisition of a 75% interest in Mataura Valley Milk (MVM), which will provide supply diversification, further strengthen relationships with key strategic partners in China, and offer access to manufacturing margins over time


Please find below documents relating to this announcement:

NZX Results Announcement
1H21 Results Commentary
Interim Report - 31 December 2020
1H21 Results Presentation
ASX Appendix 4D



1 All figures are in New Zealand Dollars (NZ$), unless otherwise stated
2 All comparisons are with the six months ended 31 December 2019 (1H20), unless otherwise stated
3 All figures are quoted based on all operations of the Group, without excluding discontinued operations, unless otherwise stated
4 Source: Nielsen MBS 12-month market value share (December 2020)
5 Source: Aztec 12-month market value share (December 2020) 

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a2 Milk™ is a brand of A1 protein-free milk from The a2 Milk Company Limited

*A1 and A2 proteins refer to A1 and A2 beta-casein protein types