News News, page-39

Its from a Nov statement

http://www.theland.com.au/story/3493755/chinese-firms-favoured-for-milk-powder/?cs=4938

With respect to my comments about taking 3 years to ramp up A2 production - I was referring to the time it takes to breed a cow and have it at milking age. The whole conversation came off the back of concerns one of my Fund Manager buddies has about A2M's ability to sustain suitable production increases. As it turns out one of his concerns is not entirely accurate as the A2 protein is present in 30% +/- of dairy cows.

However as the CEO has stated, A2M face much greater lead times to be able to meet demand. Having pointed this A2 protein misconception out to my fund manager mate, he responded by saying he still does not believe they will be able to get their supply issues sorted in time to retain customer goodwill and maximize this short window of excessive demand. His point is what is the point having a premium product if Mothers start saying - Yeah its good but I use something else because its never available.

On a positive note he believes their investments into the US and UK are more balanced and set up to promote long term sustainable growth in those markets.

On a negative note he also believe a major threat is a competitor with deeper pockets generating its own technology and bulk manufacturing a competitive product to A2M

On another positive note he believes it would be more logical for one such competitor to make a takeover play, rather than re-invent the wheel.

Anyway - I hope that clears things up as to how the whole conversation started and where it is at the moment. He is only one fund manager, so as always I doubt his views are entirely consistent with the rest of them.

Peace