The days of under $2 are not here for long as all signals are...

The days of under $2 are not here for long as all signals are pointing towards significant growth. From analysing the charts posted yesterday, pharmacy generally represents about 18% of total infant sales and this is where the real growth is coming from. At the same time you can see in the financials that A2 is achieving this without discounting as the margins continue to increase as IF sales increase. Assuming that all IF business is travelling similar to Australian Pharmacy and that A2 maintains at least 60% of sales experienced in October/November for the balance of the FY, A2 will achieve $100mil NPAT for FY2017.  Now this is only a conservative view assuming a 25% increase in costs, no income from new products and no more growth than that is already there.

Below is a sample representation how the Full year results could look.



Maybe the market was hoping for more of a positive spin from the A2 announcement but this is a very smart and conservative team that will let their numbers do the talking.

But for all of the brokers, doubters, naysayers and those thinking that A2 is tarred with the same brush as BAL then they will be in for a big shock come HY results in February.  Don't worry Hokey I will eat my humble pie if this doesn't come to fruition as in my opinion these are conservative estimates.