Well, it seems that the a2 fresh milk price in china has settled at 59yuan up from 49yuan, so I’ve adjusted my numbers for 2015 and 2016 revenues as below;
http://item.jd.com/1199167.html
http://www.farmonline.com.au/news/ag...t/2712968.aspx
ATM forecast volume for 2015: 3,000,000 1 litre bottles
ATM forecast volume for 2016: 6,000,000 1 litre bottles
Jingdong Retail Price: 59yuan = NZ$12.39
The internet retail price in China would have probably been agreed by ATM to maintain a minimum gross margin after transport costs, Jingdong margins and overheads.
COGS overall are likely around 65%, as per fresh milk in Australia, although it could well be a lot better than that given the opportunity value of the market.
This provides for;
2015 gross revenues = 3,000,000 x 12.39 x 0.35 = NZ$13M
2016 gross revenues = 6,000,000 x 12.39 x 0.35 = NZ$26M
Not a bad windfall market at all when one considers analyst consensus total revenues for ATM are FY15 NZ$149M and FY16 NZ$202M.
Thus, this new market may well represent 26/202 = 13% of total revenues in just two years.
A new market every year, it’s up and away with this company.