A2 Milk Company Limited · NZX:ATM
A2 Milk — A2 — H1 2014 Earnings Presentation
12 slides from A2 Milk's earnings presentation, Feb 26, 2014
Slide 1: A2 Corporation Limited 1H14 results presentation
A2 Corporation Limited 1H14 results presentation 26 February 2014 Geoffrey Babidge Managing Director & CEO
Slide 2: 1H14 result highlights
1H14 result highlights Australia Progress in UK Results performance and China consistent with ahead of 2013 market expectations strategic plan initiatives • Strong Revenue growth of +22.0% YOY in NZD, 28.3% in AUS • NPAT consistent with recent company outlook • Increase in market share in Australia
Slide 3: Financial highlights
Financial highlights 1H 1H NZ$m FY13 FY14 % change • Sales of NZ$54.0m (+22% cpp) Sales 44.3 54.0 +22% • EBITDA after launch costs of a2TM Platinum® infant formula and before NPAT 0.55 0.64 +16% share of associate earnings (-26% cpp) • Increase in marketing expenses of EBITDA 3.5 2.6 -26% NZ$3.2m re
Slide 4: Financial highlights (cont'd.)
Financial highlights (cont'd.) Australia EBITDA (NZ$m) 9.6 1H FY14 (1.6) 2.3 (5.7) Australia Liquid Milk EBITDA Australia Infant Formula EBITDA Intercompany Charges Total Australia Segment Profit 6.2 1H FY13 3.8 (2.4) Australia Liquid Milk EBITDA Intercompany Charges Total Australia Segment Profit N
Slide 5: Strong performance in Australia, revenue and profit ahead of plan
Strong performance in Australia, revenue and profit ahead of plan • Increase in a2™ fresh milk sales on corresponding prior period in AUD of 28.3% – a2™ brand fresh milk continues to be the fastest growing dairy brand in Australian grocery – Significant investment in marketing / communication – Mark
Slide 6: New UK structure in place, positive sales trend
New UK structure in place, positive sales trend • Acquisition of MWD interest in A2 Milk (UK) and contract pack agreement completed 1 January 2014 • New leadership with UK CEO - Scott Wotherspoon, UK Board - Billy Keane, David Hearn, Geoff Babidge • A2C to solely manage and fund ongoing development
Slide 7: a2 brand infant formula launched in China
a2™ brand infant formula launched in China • First sales of a2™Platinum™ infant formula to consumers in China from November 2013 • Formal trade launch ceremony in Great Hall of the People, Beijing, October 2013 • Second sale of inventory to China, November 2013 • China State Farm distribution networ
Slide 8: North America market entry advancing
North America market entry advancing • A2C Board considers an entry in the USA milk market should be the next priority growth initiative • UK business is established and showing growth, the Company has strong IP and know-how in the USA • USA consumer research confirms attractiveness of the A2 propos
Slide 9: Ongoing investment in intellectual capital
Ongoing investment in intellectual capital • Development of comprehensive global brand vision and trade mark suite well progressed • Continuing investment in patents, research and development • Acceptance for publication of recent research supporting digestive benefits of a2 dairy products. The coll
Slide 10: A2 Corporation strategic growth roadmap
A2 Corporation strategic growth roadmap STRATEGIC INTENT KEY EXTERNAL FACTORS STRATEGIC PRIORITIES • Opportunity for expansion of a2® • Brand penetration (via communication, Building a major market share HCP, continue building brand awareness) liquid milk • Growth opportunity in route and • Building
Slide 11: Reconciliation of non GAAP measures
Reconciliation of non GAAP measures 1H 1H NZ$m FY13 FY14 % change Australia Segment Profit1 3.78 2.29 -39% New Zealand Segment Profit1 (0.32) 0.98 +409% UK & Unallocated Segment Profit1 (0.76) (0.69) -8% EBITDA including non-recurring items2 2.70 2.58 -5% EBITDA2 3.46 2.58 -26% Depreciation/Amortisa
Slide 12: Disclaimer
Disclaimer This presentation dated 26 February 2014 provides additional comment on the market release of the same date. As such, it should be read in conjunction with, and subject to, the explanations and views in those documents. This presentation is provided for information purposes only. The info