The a2 Milk Company (ASX:A2M) Announces 1H25 Results and Dividend
Financial Performance
The a2 Milk Company reported 1H25 group revenue of NZ$893.8 million, a 10.1% increase from 1H24. EBITDA rose by 5.0% to NZ$118.9 million, and net profit after tax attributable to owners increased by 7.6% to NZ$91.7 million. Net cash reached NZ$1,014.0 million, up 28.0% from the previous year.
Regional Performance
Revenue growth was driven by the China & Other Asia segment, which grew by 11.8%, and the USA segment, which increased by 13.2%. The Australia and New Zealand (ANZ) segment saw a decline of 2.7% due to a decrease in the Daigou channel. Liquid milk sales grew by 12.1%, supported by strong performance in ANZ and USA.
Dividend Declaration
The a2 Milk Company has declared an interim dividend of 8.5 NZ cents per share, representing a payout of 67% of net profit after tax. The dividend will be paid on 4 April 2025 and will be fully imputed and fully franked.
Capital Management
The Board has established a dividend policy targeting a payout ratio of 60% to 80% of net profit after tax. The company prioritises transforming and de-risking its supply chain to support future growth, with potential for special dividends as capital management options are reviewed.
Outlook
For FY25, a2 Milk Company forecasts revenue growth of low to mid double-digit percentages, with improvements in gross margin, marketing expenses, and EBITDA margin. Key risks include macroeconomic conditions, market dynamics, and regulatory changes.
Motley Fool contributor Matt Burgess has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended A2 Milk. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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