This morning the a2 Milk Company Ltd (Australia) (ASX: A2M) reported a profit of $90.6 million on revenues of $549.5 million for the full year ending June 30, 2017. The profit nearly tripled on the prior year, with revenues up an impressive 56% as well.
The infant formula and a2-only-protein seller of supermarket milk for adults and children earned a total of 12.7 cents in earnings per share and announced its intention to buy back up to $40 million worth of shares over the next 12 months. It also flagged the possibility of a special dividend for investors depending on market conditions.
The group's core Australia and New Zealand business continues to perform brilliantly with a 3-year annual compound revenue growth rate of 60% for revenues to hit $439.6 million in FY17. Operating income (EBITDA) came in at $155.3 million.
Revenue in China came in at $88.9 million, compared to $38.2 million in the prior year and its a2-only-protein infant formula at premium prices has a potentially long growth runway ahead of it.
The UK and US revenue growth was relatively disappointing up to $21 million from $18.3 million in the prior year in a result the group partly blamed on lowe infant formula availability. Although supermarket milk sales apparently performed well.
The group expects "continued growth in FY18 in particular infant formula and milk powders in Australia and China and improved momentum in the UK and US". The stock is up 120% over the past year and 710% over the past 5 years.
