Sharechat Logo

A2 to roll out US business to eastern seaboard

Wednesday 17th January 2018

Text too small?

A2 Milk Co plans to roll out its US business to nine states on the eastern seaboard, which it expects will expand its retail footprint by more than a third. 

Auckland-based, Sydney-headquarter a2 is targeting 60 million Americans who account for about a fifth of milk consumption in the world's biggest economy, adding New York, New Jersey, Pennsylvania, Connecticut, Rhode Island, New Hampshire, Massachusetts, Vermont and Maine to the states it services in the US, it said in a statement. The milk marketer's a2 branded milk has been accepted by a number of retailers in the region, which will this month expand its presence to about 5,000 retail stores across the US from the previous 3,600 stores. 

"Since entry into the US market, the business has been focused on achieving sales based targets prior to expanding its footprint on a region-by-region basis," managing director Geoff Babidge said. "Sales velocities are now achieving sustainable levels in California, the South East region and select natural retail chains, which supports the expansion into an additional region." 

A2 has been successful in breaking into the Chinese market with its branded infant formula and has been slowly building its US business in recent years. The company has projected investing US$25 million in growing that division before generating positive earnings from the 2020 financial year.

The company's expanded US distribution will be backed by an increased marketing spend, which it said was incorporated into existing guidance. It also said it's investigating new product opportunities in the US to leverage off the growing consumer awareness of the a2 brand and bigger distribution footprint. 

A2 shares last traded at $8, having soared 246 percent over the past 12 months. 


  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares drop 1% on global selloff, led by Synlait, Sky TV; CBL meeting delayed
Global appetite for NZ yield stocks on 'pause', Harbour Asset's Bascand says
Green Acres models 24/7 on-demand cleaning service on Uber
Ponzi scheme operator Hibbs sentenced to 8 years jail over $17.5M fraud
NZ dollar ekes out small weekly gain as investors fret about possible trade war
CBL watershed meeting deadline extended, Goldman Sachs hired as adviser
Tait Communications wins contract to upgrade London bus fleet
Still a healthy diagnosis
Auckland Airport sees 92% surge in Chinese tourists in February as annual figures hold strong
Allied Farmers to net $441,137 for receivable as PVL liquidator drops suit against directors

IRG See IRG research reports