Chinese demand for baby milk formula sends A2 milk profits soaring
A2 Milk posted a 290% surge in interim earnings to NZD39.38m ($36.8m) in the December half, from NZD10.1m a year earlier. The company attributed rising profits to strong sales during China's "singles day" sales and increased market share in Australia and China. However, the rate of growth partly reflects inventory shortages the company experienced the previous year. A2's managing director added that China's evolving regulatory environment could hurt the flow of product from the country.

Unlike some key local competitors, A2 Milk has boasted of "strong growth in demand" for its infant milk formula in China as it posted a 290 per cent surge in interim earnings. Its result also benefited from buoyant demand for its milk products as it pushes into new markets in the US and UK.

Net profit surged to $NZ39.38 million ($36.8 million) in the December half, from $NZ10.1 million a year earlier, the dairy products maker said in a statement to the ASX today.

A2 Milk recorded buoyant sales in China during 'Singles day'.

The company pointed to rising sales in China in the December quarter, indicating strong sales during so-called 'singles day' when online Chinese retailer Alibaba fosters a popular sales event.

"Whilst the growth in demand was evident across the half-year, there was a marked increase in infant formula sales in the second quarter corresponding with the phasing of key sales events in China and an increase in market share in both Australia and China," A2 Milk's managing director Geoffrey Babidge said.