A huge increase also in number of SH. It has doubled in last 12 months. If 90% of them apply for the full $15k SPP we will have about $14.5k of it returned :-(
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A huge increase also in number of SH. It has doubled in last 12 months. If 90% of them apply for the full $15k SPP we will have about $14.5k of it returned :-(
Infant formula sales in 4 months to 31 Oct 2014 $ 8.7M. This year for the same period $ 38M representing 47% of Group revenue. Not bad !
Was expecting this, great news! Market loves it, rightly so. ATM are usually a little conservative in their guidance so hitting 285m is almost a given. 300m a possibility?
Want an alternative investment to ATM? Have a look at SML. IMO, currently undervalued and I'm sure they are doing very well out of
partnership with ATM and booming infant formula numbers.
I'm holding SML and consider it a long term play, I think we will see quite a bit of growth out of them over the next few years. Of course, DYOR.
Dairy plants take a long time to build (and a fair bit of capital) and I think that SML will continue to work alongside ATM - long term probably enough demand to have considerable load on two factories. I can't see ATM turning their backs on NZ farmers who have made the switch.
Firstly, Not while they are under a supply contract with a2mc.They supply a very large majority of a2 milk to a2mc in Australia via lepperton (Perich) and Moxey farms.
Secondly, Lepperton and Moxey farms operating as AFMH don't have organic registered farms.
Thirdly, long time to set up a brand and even if they do, what label are they going to sell under? They cant use anything that has any reference to a2 in their brand.
It took A2mc many years to establish their brand, do FF want to go down that track?
fourthly, a2mc will have other suppliers so if at the end of the supply contract it gets cancelled then Lepperton and Moxey have a demand problem before they can establish a recognisable brand to take up the surplus supply, because a2mc will move to other suppliers, albeit possibly having a short term supply problem. FF would have a demand problem as well as sacrificing the premium they currently get from a2mc, while they attempt to establish a brand.
Fiftly, I can imagine that they could easily run into legal issues with a2mc, because it would be hard to ride on a2's success without using that name, or any of the IP around it.
Freedom must be delighted with the share price action over the last year. It's been nothing short of a fairy tale. Not a holder of A2M but the shackles have been lifted for other shareholders now Freedom have gone.
Yeah, total waste of time, over subscribed. BUT a very positive meeting on the whole, though my mind kept wandering over to the big muffins and cream scones on the other table. What I can barely remember is something to do with not needing any more money than they already have,from the $40 million raisings from the big boys. But they might give the small shareholders a bit more allocation if they ever do it again, but I might be wrong.
Has anyone worked out FY16 SP based on the revised earning?
From the update y'day, they revised their EBITDA to NZ $22mln. You can work out NPAT from that figure roughly and on outstanding shares of 711 ml from memory, it'll be easy to work out EPS and apply relevant PE multiple.
My rough estimate is between $1.40-$1.70, however based on what happened to Bellamy's sp in past 12 months and further demand growth for A2 infant formula especially out of China, that price might be totally irrelevant. The Aussies seem to be quite hungry on this stock right now.
There is a good discussion on hotcopper.com.au re this stock which gives you plenty of information.
On another note have sent off my SPP form last night for what its worth, may get a very paltry allocation but never mind better than nothing.
Hopefully this answer what will FF do with the cash they have after selling their ATM shares http://www.scoop.co.nz/stories/BU151...er-a2-milk.htm
Took a day longer than i expected for mine.
Just hit the $1 mark again, hope it closes there or above that today :t_up:
As one who attended the meeting and is guided by FA rather than TA, I'd have to fully agree with Winner. The Aussie market for dairy and infant formula investment is obviously being driven by its own slightly crazy dynamics at present and anything is possible. One thing I took out of the meeting was the increased emphasis on IP and research, which pleased me. And although the general tone was fairly low-key despite the 2016 result upgrade I got the impression that future progress results (which will be issued quarterly because things are moving so fast) will be no disappointment.
"VIP membership cards for A2 fesh milk, CNY 1,920 for six months for 48 bottles"
"CNY 40/liter re A$8.80/L"
http://item.jd.com/1199167.html
http://item.jd.com/1625133.html
http://www.scoop.co.nz/stories/BU151...ro-a2-milk.htm
Another takeover looming???
Excerpts from the article above as per Mark Lister of Craigs.
"
Lister said a2 could be a takeover target in the future after batting away a bid earlier this year."It would arguably fit quite nicely into the portfolio of a larger player," he said.
I would very much doubt that. It's the kind of speculative comment that is sometimes tossed around by people who don't understand that A2 isn't just an alternative brand of milk that would make a nice addition to some company's product range. The entire a2 business is based firmly on a scientific proposition that is rejected and seen as a threat by the rest of the global dairy sector, namely that the standard bovine milk sold round the world contains a protein (a1) that is indigestible and/or medically hazardous to many consumers.
The growth of the a2 business will gradually and inevitably bring it into more direct conflict with the rest of the dairy sector as more scientific findings emerge. Therefore it doesn't fit into the portfolio of any mainstream dairy player, which raises the question, who else would be interested in it?
One of the positives to emerge from the recent rise in the a2MC share price is that it pretty much puts it out of the question as a takeover target (the offer would have to be around $1bn minimum), and secures a2MC's capability to stand on its own. That doesn't exclude the possibility that an outside company might be interested in taking a substantial stake in a2MC, especially now that Freedom Foods is no longer a 20% holder.
No shortage of Healthcare product companies outside the dairy companies there NT. Blackmores $3 Bill mkt cap,and Ebos $2 Bill plus(have already taken out someone bigger than them i think) , just two in our backyard.
If its as much as a threat as you say ,I think it would fit fine in a big dairy co.s product range--all bases covered,and no more threat.
Any body kept track of all those SSH lately
Seems an awful lot sold - whose been buying?
If its as much as a threat as you say ,I think it would fit fine in a big dairy co.s product range--all bases covered,and no more threat.
Yeah it's all on the go, seems as though Milford and Mountain Road sold quite bit of late as per SSHs.
However, the billion dollar question is who bought that 75 ml shares block sold by Freedom Foods?
Its 2 business days since sold, so the buyer whoever that may be should issue SSH notice by COB today. I'm picking they'll issue one after market closes today.
its game on from there depending on who the buyer is, rumour to be overseas buyer Chinese perhaps....JD.com?
Skid, I accept that's the way some people see it because it looks temptingly logical in a marketing sense. Up till now, a2MC and its predecessor A2 Corp have managed to survive in a market dominated by sellers of A1 milk by just saying "A2 is good for you" and not annoying its competitors too much. As a result, many consumers and marketing analysts think A2's success is just due to slick advertising and maybe putting a secret additive in the milk that gives you warm fuzzies.
In the longer term, though, with more and more science emerging that shows A1 and mixed A1-A2 milk not only causes digestive problems but has real medical implications as well, how is a new owner going to explain to its consumers why it's continuing to sell them A1 milk as its mainline product?
A few years ago there was much less science available on A1-A2 and still some dispute about it, but it's now become a big topic for research teams round the world who are uncovering and publishing details of the nasty things A1 can do to you.
It's no longer disputed now that A2 milk is the original natural milk produced by cows and also by human breast-feeding mothers, and A1 milk is a genetic aberration that can cause problems in many consumers. If you believe in the science, you have to say "A1 is bad for you", and this is what a2MC is gradually moving towards doing, rather than just trotting out the old blah that "A2 is good for you". That's not an easy position to adopt if you're pushing A1 milk and formula as your main product line.
Hi NT I accept what you are saying except that you overstate things when you say "A1 is bad for you". More correctly you should say "A1 is bad for some".
Nice to see Cliff Cook (Mountain Road Investments) making a nice profit on the sale of part of his substantial holding in a2MC. If anyone deserves it, he does. He came to the company's rescue both financially and managerially after it was left in a very difficult situation by the deaths of its two inspirational founders, scientist Corran McLachlan and financier-agriculturist Howard Paterson, within weeks of each other back in 2003. We all owe Cliff Cook a vote of thanks.
At the risk of seeming to dominate this thread for the moment, I'd make two a couple of points briefly on that. First, some people who smoke reach a ripe old age in apparent good health, but I think it's still valid to say "smoking is bad for you". Much the same with drinking A1 milk. It is already known for example that the opioid peptide BCM7 generated by A1 milk can disrupt antioxidant activity and increase the risk of organ and tissue inflamation, potentially leading to various lethal or serious medical conditions. Some people's immune systems will cope with this better than others' and it won't actually kill or make consumers manifestly ill in all cases, but it can certainly be described as bad for you if it increases the risk.
Well put NT
I think comparing smoking and the damage cigarettes do with A1 milk is a bit OTT. I can't imagine the day where I am looking at two bottles of milk in the supermarket, one with photographs of inflamed organ and tissues on the label.
Also, if your body is able to tolerate A1, is it actually bad for you when you balance that against all of the other benefits dairy can provide? Based on your argument, you may suggest that going out for an evening walk/run is bad for you because you risk breathing in fumes from the traffic/city smog which have been proven to cause X,Y and Z.
Has anyone heard whether the offer was oversubscribed and by how much???
Very interested to see what we get. Has to be at least 2000 shares as ATM applied for a mandated minimum 2000 shareholding and some people may have qualified for shares and then sold down their shares to buy these shares...
I would be very surprised if we get 20% of what we applied for. 10% might be closer to the truth
If all 6,000 odd shareholders applied for $15k - and at a 50% gain why wouldn't you (67c to $1).
Then $90m subscribed - you would only get 1/30th of application. - may be lucky to get 10%
All these issues involve balancing the risks against the benefits, obviously. I gave up jogging on Wellington's winding hill roads some time back because of the risk of completely buggering a hip, ankle or knee, so now I walk instead (no fumes in windy Wellington). And I'm sure you're right about labelling milk with gory pictures (which I'm not advocating), but there are lots of other ways of getting the message across, either with or without public health agency involvement.
I'm also not saying the health damage attributable to A1 is equal to that due to smoking (which also has fewer offsetting benefits). That actually remains to be seen. As things stand at present, the benefits of drinking A1 would appear to outweigh the proven downside risks, especially for infants whose mothers are unable to provide lengthy breast-feeding. Infants up to the age of about 2 years are the most susceptible to damage from A1 because their gut lining is permeable and allows the BCM7 peptide to pass through into the bloodstream. No one (least of all the a2MC) is yet urging people to stop drinking A1, partly because there's not enough A2 available to fill the gap, but it is time to start accepting that the risks attached to A1 go well beyond mere digestive discomfort.
Whether anyone's body is "able to tolerate A1" without any health damage is something we just don't know yet. What we know is that damage has been clinically identified in some human subjects. We may find some people can "tolerate" A1 without clear harm, but how many and to what extent remains unknown. Medications may be developed that can reduce the harm, but is it worth running the risk? At this stage there are still lots of questions and few quantified answers, but a growing body of research evidence that should be food for thought - for consumers, the medical profession, dairy farmers and the dairy industry among others. For myself, I avoid drinking A1 milk.
My logic (strictly in a business sense)is that ,if you buy the company(a2)and it becomes part of your stable,there is then no need to finance more scientific tests which detract from your mainstream (a1) product--you continue to sell a2 to those that want it,but being largely a defensive buy you dont mess with it, and make due with your ''niche''market of a2 enthusiasts,which hopefully pays the way for your new addition,while at the same time selling you main product with no fear of being exposed as an inferior product.
(of course this would only work for a very large dairy co. with heaps invested in the a1 stock and deep pockets AND A2 would have to get big enough to pose an actual threat...(something like Fonterra buying to protect its multitude of a1 farmers)
Director's (Julia) stamp of confidence from their purchase of 50,000 shares on market.
Dear a2 - GO YOU BEAUTY!!!
It would seem the punters have eyes for no-one else but ATM on the NZX these last few days.
Wot a shame :)
What a day. Up another 10% so far on large volume and not over yet. We sure are having a great ride and one wonders when she will take a breather. Should be getting most of our $15k SPP money back on Thursday :-(
From thebull.com.au (Its free)todayBUY RECOMMENDATIONS
The a2 Milk Company (A2M)
http://www.thebull.com.au//get_foto....=8033&size=600
Chart: Share price over the year
The company recently upgraded profit, revising EBITDA from $NZ12 million to $NZ22 million. A strong contributor to this performance was infant formula sales, where demand from China is exceptionally strong. Infant formula now accounts for 47 per cent of group revenue, enabling direct comparisons with Bellamy’s Australia, but with A2M offering considerable relative value to Bellamy’s.
That was some rally today, still the 75 ml share block buyers to be revealed, once that's known there might be another rocket under sp (depending on who that is).
Hoping for decent allocation under SPP, happy with anything though as there's a 50c gain straightaway and no brokerage. Tell you what those instos who got in SPP would be singing happy tunes right now, lucky them.
Across the ditch they are portraying this to be next Bellamys or even bigger!!!
Wow youre right sb9.Ive just really noticed the days end price $1.09,11.22% rise today on big vol, re 15.5 mill shares thru, high of $1.12!!. More to come? Hope Mac is a happy holder.
I have got a question that some may able to put some light on this topic. It may not be related at all. There were two announcements today were about two investors reducing there holdings in ATM but yet SP shot right up again.... Are these the reasons that the SP went up or is there something else? Thanks you.
Whats going on here? A silent takeover. I am lost for words.
At what point doe this get silly - up 14c today.
Here I was Friday thinking it was going to take a breather at $0.99 and consolidate there for a while.
Sellers side is dry as. Wish I'd filled my boots more at 50c but hindsight and liquid money is a wonderful thing.
I think at this levels people should be careful...aussie speculators are running the price. SML makes formula for ATM.
I'm no longer a holder but if I was I would be selling right about now. I like the product, I like the company, I like the vision but I can't imagine how much milk they will need to sell to support this valuation.
Was about to say current share price values the company at $884m, but then saw the share price has gone to $1.27 so means $912m. Or about 28% more than Friday, on a company with a forecast operating EBITDA of $12m.
But it is really about the growth story and the technology - what is it worth to someone. Only going to get more expensive to take them out.
Just wish they'd had a bigger public pool at 68c! :t_down:
Just sold my holding as well.
53% return on 6 months of holding not bad at all.
*edit* compared Market cap, earnings and growth to SUM and HNZ similar size companies but much larger earnings both with good growth ahead.
there may be a bit of Xero/Tesla factor in ATM though.
Roughly 174 mill shares thru since 16th Nov re 21% of shares on issue (re 819 million) traded. Someone/s buiding a stake but no SSH notice atp.Has the trend reached the bend at the end, i don't think so.In play ; very possibly.
think this has got a long way to run at the moment, the aussies are all over it, look at the chart for "BAL" and massive volume. Can see it shooting over the billion dollar mark soon. Wow congrats to holders who have brought earlier in the year. A2M takes the 2015 best performing stock award.
www.sharechat.co.nz/article/f8890d50/new-image
New Image Group, is seeking to sell up to half the company to raise money to expand its infant formula manufacturing, following strong demand from China and wider Asian markets.
While this pages posters may have done the smart thing, remember that BAL on ASX currently has a capitalisation of over 1b AUD and has a lot less revenue and arguably potential to produce goods compared to ATM. Revenue growth and potential are what people are investing in, I believe.
^^ Agree, bit more information here - https://www.fool.com.au/2015/11/20/5...-your-returns/
I don't know anything about bellamy's other than whats been covered on this thread, but in terms of comparisons - which markets do Bellamy's service? a2 are building some pretty valuable partners and sales channels for global domination.. At a guess I can see a2 overtaking Bellamy's, as increasing organic milk supply is a painstakingly long process, where as a2, whilst expensive to do so, could increase supply at a much faster rate.
And then there is also the question of what the present and future demand for premium niche infant formula from China really is, and will be (can the present demand be quantified if it exceeds the current supply?).
Should a2 announce a quickish solution to the supply shortage - then this stock will surely have a second rocket lit up under its gluteus maximus!
You're not alone left field, seems as though Milford sold some more in the past few days, but no affect on sp though keeps bouncing up more. Must be the demand coming from Aussies, waiting to see the new SSHs to be posted soon.
Just been reading this thread back in June , July , great work see weed . You mentioned $ 1.20-1.30 a number of times .Who would have thought we would make it before December once the takeover failed to eventuate .........
Pity Fonterra can't create this much value ..... what a rockstar economy we would be if they pulled finger :)
This company is big news all over Australia. I think there might be more legs in this yet. All the business channels have experts commenting on the company. Ithink most of the buying is offshore from Aust etc. Huge volume through.
Several commentators are trying to compare its valuation to Bellamy's BAL.
Chart indicates upside potential remains, even though PE is looking a tab high.
Go them Aussies! ;) (never thought I would say that!!)
Attachment 7744
Nothing new but FWIW
http://www.nzherald.co.nz/business/n...ectid=11550655
Another $23m gone through before opening. Those Aussies really are nuts!
Did somebody get out of the wrong side of the bed this morning
What are these guys on
A2 Milk cut to underperform at First NZ as brokerage awaits proof Australian success can be replicated
Wednesday 25th November 2015
Text too small?
A2 Milk, whose shares soared 65 percent in just over two weeks, was cut to 'underperform' at brokerage First NZ Capital, which said it wants evidence the milk marketer can repeat its Australian success in other markets such as China, the UK and the US.
The shares fell 0.8 percent to $1.22 on the NZX today, having soared to a record $1.27 yesterday from 77 cents on Nov. 6. A2 Milk, whose shares also trade on the ASX, has been part of an Australian rally driven in part by media reports of a shortage of infant formula across the Tasman in the face of rising demand in that market and in China. Infant formula maker Bellamy's Australia has climbed about 32 percent in the past two weeks, while health supplements maker Blackmores, which last month announced a tie-up with Bega Cheese to market infant formula in China, jumped 35 percent at the end of October.
Analysts at First NZ say articles in the Sydney Morning Herald helped propel a2 Milk's shares in the past two weeks, starting with one on Nov. 8 that reported a shortage of infant formula on supermarket shelves, a report that the company was considering building an infant formula plant, and one that asserted the product was "the new iron ore", a reference to the boom Australia's resources sector had enjoyed supplying China's steel mills. Also helping, the company raised guidance for sales and earnings at its Nov. 17 annual meeting, which coincided with former cornerstone shareholder Freedom Foods Group selling its remaining 10.4 percent stake.
First NZ kept its share price target unchanged at $1.18, while saying successful strategy execution in Australia, the UK, China and the US "could justify a high-case DCF-based valuation of up to $1.53." The lower target price reflected an assessment of the success probability and "potential execution slippages" in a2 Milk's key markets, the brokerage said in a note.
"While we have respect for management's exceptional execution to date in Australia, our confidence in the duplication of this success elsewhere requires further progress in other markets," it said. The downgrade to 'underperform' from 'outperform' was based on a2 Milk's current stock price and the brokerage's rating framework, it said.
First NZ assumes the company's infant formula sales in Australia reach 7,500 tonnes in 2025 from a forecast 5,600 tonnes for 2016, with some of that production potentially finding its way to China via "grey channels" involving third parties. Its share of Australia's liquid milk market is assumed to reach 3.6 percent by 2025, from 2.7 percent in 2016.
Sales in China are projected to reach 3,000 tonnes a year, worth US$110 million, in 2025, from the projected 400 tonnes worth US$15 million in 2016. For the UK, the brokerage assumes a 1.5 percent share of the liquid milk market in 2025, although "until ATM demonstrates further progress and traction in the liquid milk segment, we think it is prudent to exclude possible upside from the potential introduction of other a2-type based products including ATM's infant formula portfolio," it said.
It puts the same rider on its assumptions for the US market, where it sees the company gaining 4 percent market share in California in 2025 and about 0.5 percent in the rest of the US.
Some 55 percent of First NZ's $1.18 target price is accounted for from an assumed aggregate 10,500 tonnes of infant formula sales at an average earnings margin of 27 percent by 2025, from 6,100 tonnes in 2016. A further 36 percent is from the balance of its Australian portfolio, mainly liquid milk. The remaining 9 percent of the target price comes from the risk-weighted valuation of the US and UK operations.
To justify a price target of $1.22, the company would have to lift infant formula sales to 15,500 tonnes a year.
"At this juncture, we think it is prudent to wait for confirmation from evidence of execution in ATM's direct infant formula sales into China as well as the company's planned distribution roll-out into the USA market," it said.
From sharechat.co.nz
Well, may be First NZ want to buy more at lower price hence the recommendation. Aussies are absolutely all over this and will chomp on anything available at lower levels.
Just a fleeting visit on my behalf. Well done to you guys who sold yesterday - parabolic charts are always corrected, usually quite sharply, so a good timely exit IMO
Re FCNZ - my instinct says they were the sellers overnight or this morning - it's met their target, they'll cut and run. Might be wrong, but lets see if there's a SSH soonish
$112,000,000 odd wiped off since $1.27 high yesterday. Has any one started buying back in yet, at these lower prices?
:p corrected!
Gosh, that was some action packed two days of trading. Big volumes through and yet to see any SSHs being notified, quite interesting.
Not too bothered anyway, hopefully will find out tomorrow how many shares got allocated under SPP and tuck them away with my current holding.