Noted some ppl keep saying supply would be short and can’t meet the sales target. Did any one really read the bottom line and understand where fresh A2 raw milk come from?
i had a quick read Synlait financial report and noted they collected 60,000 mt of raw milk a year from 200 contracted farm. Converting to a2 herds was assumed at 5% rates a year. So year by year the existing farm will increase A2 raw milk by say 3,000 mt. There are thousands of milk farms in NZ. If multiply the 5% conversion rate, there is not enough capacity to convert them into IF. Luckily pokeno is supposingly to complete by early 2019.
ppl did also mentioned converting the fresh milk to IF. I believe this is one of strategy they working on. A2 contracted Fonterra to supply fresh milk, hence whatever collected by Synlait can be used for IF.
Until pokeno receive SARM license, possible whatever they produce there would be an English label, and current factory focus on China export.
reading at their production output from 2016 onwards. I believe the sales revenue has possibility to reach 1.5b.
using the 70% growth rate, the 2017 output was 18500 mt, then 2018 should grow to 31,450 mt, but produced 36000 mt. And they stated there is a massive stock for first quarter sales in balance sheet. Presume due to growth rate month by month, first quarter can sell between 8500-9500 mt - plus presume stock level around 6-7,000mt due to change of label and slow in sales. Which means the 922m revenue was generated via a sales of 28,000 mt. This year Synlait forecasted 41-45,000 mt. Plus the stock in hand and stock for next financial year- we foresee a sales of between 45-50,000 mt. If Synlait can increase output capacity it would be crazy.
A2 said margin in China is higher, if double the sales already increased revenue by 250m, triple then we can achieve 1.5b revenue
if a2 did sales 1m tins of IF and adult powder, this will almost equal to 1,000 mt of productions. Possibly this year the maximum output is 50,000 mt, they need the stock to cover the rest of the year plus 12/12 and black Friday sales.
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