A2 Milk Limited (A2M.ASX) Summary

Brief info on company:

• 57% earnings generated from Australia/New Zealand, 39% from China/Asia and 4% from UK/US

Market expectation for FY20 results:

Overall markets are expecting revenue to rise by 34%, earnings (NPAT) to increase by 36% and EPS to rise by 37%.

Key Recent Events:

In April, A2M provided a business update, stating strong growth in all regions, especially China and Australia.

Outlook:

Sales were strong for A2M during the COVID season, driven by both panic buying in the US and Australia, as well as strong demand for its premium products in China. The rise in online purchases also contributes to its strong growth. This should persist in the near-term. However, as China’s economy recovers, we’ll likely see a resurgence of Chinese competitors, which could impact A2M’s growth in the mid-term.