A2 Milk raises sales outlook as NZ$2bn target comes into view

Core Viewpoint - A2 Milk Co. is optimistic about achieving its NZ$2 billion ($1.2 billion) sales revenue target ahead of schedule, driven by strong performance across all segments and product categories in the first half of fiscal 2026 [1][2]. Group Performance - Group revenue increased by 18.8% to NZ$993.5 million, with EBITDA climbing 18.4% to NZ$155 million and underlying EBITDA rising by 25.9% [4]. - Net profit after tax rose by 9.4% to NZ$112.1 million, while basic earnings per share increased by 9.2% to 15.5 cents [4]. Segment Performance - The US and China/Asia regions led growth with revenue increases of 29% and 20.3%, respectively, while Australia and New Zealand grew by 8.6% [2]. - Infant-formula sales rose by 13.6%, with English-label baby powders increasing by 20.9% and China labels by 6.5% [5]. - Liquid milk sales grew by 18.5%, with the US showing a growth of 29.3% and Australia/New Zealand at 11.9% [5]. Strategic Focus - The company continues to focus on maximizing opportunities in the China infant-milk formula market, which remains central to its growth strategy [2][3]. - A2 Milk's liquid-milk businesses are performing exceptionally well, contributing to double-digit revenue growth as consumer acceptance of A2 milk increases [3]. Future Outlook - The company has raised its revenue outlook for the full year to mid double-digit growth, up from a previous low-double-digit guidance [1][2]. - A2 Milk is also looking to expand its presence in the US market, leveraging new dietary guidelines issued in January as an opportunity for category expansion [6]. Acquisitions and Investments - A2 Milk is acquiring an infant-formula business in New Zealand and plans to invest NZ$100 million to increase capacity [6]. - The company is purchasing a plant owned by Yashili New Zealand Dairy in Pokeno while selling its majority stake in Mataura Valley Milk [7].