ATM-A2 MILK

[KW]

Didn't you write "Or the reports of all the other listed ASX and US companies who utilise the daigou trade" on my statement that you did not read A2's report? Ignoring company's report is quite an interesting way to say - I'm interested in companies who work with daigou and analyze its business. My comprehension skills allowed me to build very successful career and retire at somewhat young age quite awhile ago and live on my investments. So, I'll keep it as it is for now.
"So yes, I've moved on to BUB" - does not look like since you are still hanging around

no, you said I got my info from reading the media, and I replied that I get my info from reading other companies reports.  do you understand now?

[CG]

no, you said I got my info from reading the media, and I replied that I get my info from reading other companies reports.  do you understand now?

Yes, that was a secondary part of my statement and I was expecting reply for the primary one. Anyway, I apologize for this misunderstanding.

[Left Field]

A temporary boost for SML and ATM.....( A2 SAMR renewed until Feb 2023)

https://www.nzx.com/announcements/398607

As noted in the Company's FY22 results announcement on 29 August 2022, a2MC's current China label IMF product registration was due to expire in late September 2022. As anticipated, Synlait has received notification from SAMR that the current registration has been renewed. In effect, this will allow Synlait to manufacture a2MC's current registered China label product until 21 February 2023 when transition to the new GB standard is required. Product manufactured up until this date is allowed to be sold in market after that date.

New GB registration process

a2MC and Synlait are also working closely together in relation to the registration of a2MC's China label IMF products, formulated in line with China's new GB standards. While this is also progressing, timing is uncertain and remains subject to SAMR approval.

[Hectorplains]

A temporary boost for SML and ATM.....( A2 SAMR renewed until Feb 2023)

https://www.nzx.com/announcements/398607

As noted in the Company's FY22 results announcement on 29 August 2022, a2MC's current China label IMF product registration was due to expire in late September 2022. As anticipated, Synlait has received notification from SAMR that the current registration has been renewed. In effect, this will allow Synlait to manufacture a2MC's current registered China label product until 21 February 2023 when transition to the new GB standard is required. Product manufactured up until this date is allowed to be sold in market after that date.

New GB registration process

a2MC and Synlait are also working closely together in relation to the registration of a2MC's China label IMF products, formulated in line with China's new GB standards. While this is also progressing, timing is uncertain and remains subject to SAMR approval.

This extension was well flagged.  It would have been a bloodbath for the stock if it had surprised the other way. 

[Left Field]

Steady progress by ATM, confirming Chinese market's key partnership through to 2027.

https://www.nzx.com/announcements/399817

The a2 Milk Company (a2MC, the Company) is pleased to advise that it has renewed its exclusive import and distribution arrangements with China State Farm Agribusiness Holding Shanghai Co., Ltd (CSFA) for a term of five years from 1 October 2022.

CSFA has been a2MC's strategic distribution partner in China since 2013 and is the exclusive import agent for a2MC's China label products, including a2 至初® China label infant milk formula.

CSFA is a wholly owned subsidiary of China National Agriculture Development Group Co, Ltd (CNADC), which is also the parent company of China Animal Husbandry Group (CAHG), which holds a 25% interest alongside a2MC's 75% interest in Mataura Valley Milk (MVM) located in Southland, New Zealand.

The a2 Milk Company's Managing Director and CEO, David Bortolussi said:
• "We are pleased that our long-standing arrangements with China State Farm have been renewed for a term of five years through to the end of September 2027. "

[BlackPeter]

I guess this is about as unexpected as day following night or the outcome of any AGM vote about management paying the auditors ...

It is basically saying that Shanghai City Holding will continue to buy the products from Shanghai City Holding. Don't forget - they minority own and majority control Synlait and they have as well an interest in Mataura Valley Milk.

What a surprise they continue to buy their own products! Well down ATM, I recon they had to negotiate really hard.

More interesting will be how they plan to circumvent the export ban after Xi's war in Taiwan has started ...

[Left Field]

Having this long term agreement in place and now extending it to 2027, bodes well for the SAMR approval process that needs to be obtained by Feb 2023.

Another brick in the wall.

[Arbroath]

share buyback starts from today...imagine they'll do it on the ASX mainly as its more liquid over there

[winner (n)]

What's this Care A2 Plus that's looking at an IPO in OZ - all the rage on Hot Copper which I can't see because banned for life over there

NBR had a story about. Tim Hunter made this comment -
On current form, NZX-listed A2 Milk will not be quaking in its boots about Care A2 Plus specifically, but the wider problem is whether its arrival signals the ultimate commoditisation of A2 products, eroding the aura of exclusivity and margins along with it.

A2 Milk will be focused on maintaining the pecking order.

[Left Field]

What's this Care A2 Plus that's looking at an IPO in OZ - all the rage on Hot Copper which I can't see because banned for life over there
....

A2 Milk will be focused on maintaining the pecking order.

Here's the company's web site; https://carea2plus.com

The difference seems to be A2 plus lactoferrin to "have the same nutritional profile as human milk."

Has FDA approval to supply the USA Market from July 2022.

Could be seen to be paving the way for ATM to enter the USA with IF (when MVM up and running) and then maybe some legal action?? .....

Whatever..... it all helps grow the total A2 market in the meantime.

[KW]

What's this Care A2 Plus that's looking at an IPO in OZ - all the rage on Hot Copper which I can't see because banned for life over there

NBR had a story about. Tim Hunter made this comment -
On current form, NZX-listed A2 Milk will not be quaking in its boots about Care A2 Plus specifically, but the wider problem is whether its arrival signals the ultimate commoditisation of A2 products, eroding the aura of exclusivity and margins along with it.

A2 Milk will be focused on maintaining the pecking order.

Care A2 got FDA permission to import IF into the US during the emergency crisis, but it ended up never shipping anything.  It said it was developing a special formula product for the US market, but the FDA said if they did that then they would lose their EUA and would have to reapply for permission to import and start from scratch.  So likely not ever going to happen.

Both BUBS and Bellamys have A2 infant formulas.  Its already a commodity product.  In fact A2 Milk is now lagging behind Bellamys in the premium segment as the Bellamys A2 infant formula is also organic.  All of BUBS goat milk formulas are also A2 in addition to their A2 cows milk formula. 
https://bellamysorganic.com.au/shop-online/formula/beta-genica-a2-formula/beta-genica-8-step-1-infant-formula/
https://www.bubsaustralia.com/collections/bubs-supreme

Aptamil have also gone ultra-premium with an organic A2 range.  The price is $60 a tin (!) compared to $40-$42 for the other three A2 brands. 
https://nutricia.com.au/aptamil/products/aptamil-essensis-1/#

[Basil]

Agree 100% KW that its just another commodity now.
The strange thing is it still trades on the same near 30 forward PE it did back many years ago in the good old days when sales and earnings were both growing strongly under Geoff Babbage's leadership.  Not just that but you could very easily make the case the company had much better and more focused leadership under Geoff Babbage than the current CEO and there was far less competition to boot and what's more back then they were making headway based on first mover advantage.  Go figure on the forward metrics now considering the much different operating environment including much worse potential geopolitical risk ?
https://www.marketscreener.com/quote/stock/THE-A2-MILK-COMPANY-LIMIT-11384022/financials/  (FY23 consensus PE 28.2)

[winner (n)]

Always looking at high growth company's growth rates .... and a thing called growth rate of decay

Anyway below is A2 annual growth (as at end of each half year) since 2015

Was high growth until disaster struck .... sort of reverted to long term trend (down) and from here growth rate is declining.

Years out to F26 based on their recent stated ambition of reaching $2 billion revenues by FY26 ..... CAGR 7% from current level. So not my guess lol)

Maybe should be seen in light of basil saying A2 still on a PE of about 30

You cannot view this attachment.

[Basil]

Useful filter I use to find growth stocks that offer genuine value is no growth PE of 8, (this figure varies depending on the 10 year Govt stock rate) + 1g where g is the expected eps growth rate for the next 5 years.  On that basis if we're talking an expected CAGR of 7% I would think this would pique my interest on a forward PE of about 15.  15 x expected eps for FY23 of 21 cents = $3.15.

[winner (n)]

Useful filter I use to find growth stocks that offer genuine value is no growth PE of 8, (this figure varies depending on the 10 year Govt stock rate) + 1g where g is the expected eps growth rate for the next 5 years.  On that basis if we're talking an expected CAGR of 7% I would think this would pique my interest on a forward PE of about 15.  15 x expected eps for FY23 of 21 cents = $3.15.

My bad basil ...their ambition is revenue 8.5% pa and to improve margins.

So profit growth could be 10% pa

So maybe PE of 18 should be in your calcs ....share price $3.78

That's better eh

Talk of share buy back ..that should help as well