Story image

A2 Milk debuts on ASX, announces mid-April US launch

31 Mar 2015

A2 Milk Co, the milk marketing company, will launch into the United States from mid-April, with a range of half-gallon fresh milk cartons in supermarkets and natural products grocers in California.

The announcement on the launch timing in mid-April comes as the company commenced trading on the Australian Securities Exchange today. The ASX debut comes after seven years in the Australian market, which Managing Director Geoffrey Babidge called "A2's big cash generator", and will bankroll the Auckland-based company's push into new markets.

The company has budgeted a cash investment of US$20 million over three years for its US launch which will be funded by cashflow and internal sources.

Market reception from pre-launch activity in the US has been positive, Babidge said, with a successful showing in March at the world's largest natural, organic and healthy product expo in Anaheim, California.

Jeffrey O'Neill has been appointed chief executive of A2's wholly owned business in the US. He has over 30 years' experience in brand marketing and sales with prior roles at Pepsi-Cola and Priszm/Yum brands and more recently as head of American restaurant chain The Einstein Noah Restaurant Group.

Babidge said the ASX listing, which didn't include a capital raising, was another step in the company's journey to making its premium milk products available in a number of attractive international markets.

"Our Australian operations are the most significant component of our current business, continuing to deliver strong profit and revenue growth. The ASX listing, in conjunction with the listing on the main board of the NZX, provides a closer alignment between our capital markets profile and our current business," he said.

A2 says it is one of the fastest-growing dairy brands in Australia, and claims a 9 percent share of milk sales by grocery value. The single biggest shareholder in the company is Australian-based Freedom Food Group with just under 18 per cent. Future plans in Australia include pushing further sales of A2 Platinum infant formula and extending into other branded dairy products such as cheese and ice-cream.

As previously announced, the ASX listing kicks off a number of board changes including Cliff Cook and David Mair stepping down as directors with David Hearn becoming chair and Julia Hoare appointed deputy.

In line with a constitutional change approved earlier this year, the company is only required to have two rather than three directors who are New Zealand residents, in line with the NZX's main listing rules.

The stock debuted on the ASX at 55.5 Australian cents, and recently traded at 54 Australian cents, with A$1.2 million worth of shares changing hands. Meanwhile, on the NZX, A2 rose 10 percent to 55 cents, paring an intraday gain to as high as 56 cents.​

50 million tonnes of e-waste: IT faces sustainability challenges
“Through This is IT, we want to help people better understand the problem of today’s linear “take, make, dispose” thinking around IT products and its effects like e-waste, pollution and climate change."
Vocus & Vodafone unbundle NZ's fibre network
“Unbundling fibre will provide retail service providers with a flexible future-proofed platform regardless of what tomorrow brings."
IDC: A/NZ second highest APAC IoT spenders per capita
New IDC forecast expects the Internet of Things spending in Asia/Pacific excluding Japan to reach US$381.8 Billion by 2022.
Xero launches new data capture product in NZ
“Data automation is the fastest growing app category on the Xero app marketplace so we know there is a hunger for these types of tools."
Security flaw in Xiaomi electric scooters could have deadly consequences
An attacker could target a rider, and then cause the scooter to suddenly brake or accelerate.
Four ways the technology landscape will change in 2019
Until now, organisations have only spoken about innovative technologies somewhat theoretically. This has left people without a solid understanding of how they will ultimately manifest in our work and personal lives.
IDC: Top 10 trends for NZ’s digital transformation
The CDO title is declining, 40% of us will be working with bots, the Net Promoter Score will be key to success, and more.
Kiwi partner named in HubSpot’s global top five
Hype & Dexter is an Auckland-based agency that specialises in providing organisations with marketing automation solutions.