The A2 Milk Company Ltd (ASX: A2M) share price is in focus today after the company released its FY26 results, highlighting a 12.4% rise in revenue to NZ$1.97 billion and the declaration of both ordinary and special dividends.
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What did The A2 Milk Company report?
- Revenue grew 12.4% to NZ$1,974.9 million.
- EBITDA fell 2.5% to NZ$284.4 million, while underlying EBITDA rose 5.4% to NZ$307.6 million.
- Net profit after tax (NPAT) dropped 5.8% to NZ$207.5 million; underlying NPAT increased 7% to NZ$235.8 million.
- Ordinary dividends totalled 21 NZ cents per share, up 1cps; special dividend of 41.36cps also paid.
- Net cash closed at NZ$784.5 million, down 26.1% year on year.
What else do investors need to know?
A2 Milk's revenue growth was powered by strong performance in English label Infant Milk Formula and Other Nutritionals, offset by supply chain issues in China label IMF during the fourth quarter. These disruptions have since been resolved, with improved product availability and initiatives underway to regain users and support new customer recruitment.
The company's Australia and New Zealand liquid milk business continued to outperform, capturing additional market share through innovation such as lactose free offerings. In the USA, revenue surged 28.6%, with the business achieving break-even in the second half while brand awareness and household penetration increased.
What's next for The A2 Milk Company?
Looking forward to FY27, A2 Milk expects revenue and EBITDA to increase, supported by new product launches and expanding into new markets. The company anticipates IMF sales will stabilise, with recovery in China label IMF projected over the coming year and further momentum in English label channels during the first half.
Capital expenditure is forecast at around NZ$70 million, with ongoing investment in innovation, sustainability, and supply chain transformation. Management will provide an update on their IMF recovery plan at the Annual Meeting in November.
The A2 Milk Company share price snapshot
The A2 Milk Company share price has been sold off over the past year, with its shares underperforming the S&P/ASX 200 Index (ASX: XJO) with a disappointing 18% decline.
