The A2 Milk Company Ltd (ASX: A2M) share price will be on watch this morning following the release of its full year results.
During the 12 months ended June 30, the infant formula and fresh milk company delivered revenue of NZ$1,304.5 million and EBITDA of NZ$413.6 million. This was a 41.4% and 46.1% increase, respectively, on the prior corresponding period.
According to the release, the key driver of this growth was once again demand for its infant formula products in the massive China market. Sales totalled NZ$1.1 billion for the year. This was an increase of 46.9% on the prior year and meant the company's infant nutrition market share strengthened to 6.4% in China.
Another highlight was the doubling of its revenue in the US fresh milk market. It's distribution in the massive market has now expanded to 13,100 stores.
In Australia its fresh milk revenue grew 10.7%, leading to its market share reaching a record of 11.2%.
Management said: "The company delivered record financial and market share results for 2019. This was enabled by strong revenue growth across our key product segments of liquid milk, infant nutrition and other nutritional milk products, and across each of our key regions. Pleasingly, our results were underpinned by growing brand awareness, expanding product distribution and strengthening in-market execution in our two most important regions of Greater China and the US."
How does this compare to expectations?
According to a note out of Morgans, it was expecting the company to deliver EBITDA of NZ$431.3 million in FY 2019. Morgans was one of the most bullish brokers covering the company, with the market consensus estimate a little lower at NZ$420.6 million.
As you can see above, a2 Milk Company has fallen a touch short of expectations. So all eyes will be on its share price at the open.
