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.
No comments yet
NZ shares gain as market cheers Fletcher plans, Sky TV, A2, Auckland Airport rise
NZ dollar falls on tepid economic growth, rising greenback
Restaurant Brand affirms annual earnings guidance, on look-out for US director
Xero shooting for a million customers in UK as digitisation looms
Foreign farm buyer applications withdrawn in the past 12 months have tripled, OIO figures show
Fonterra satisfied with Beingmate's response to labelling error
Fletcher shares gain on five-year strategy to chase sales, margin growth
Gentrack acquires UK-based Evolve Analytics for 23 mln British pounds
NZ economic growth slows in first quarter as construction activity weakens
Independent expert to determine fair price for Chow Group shares after shareholders object