News

A2 records big annual profit

By Geoff Adams

Infant formula company A2, has recorded an annual, after-tax profit of $385 million.

The company has also announced the appointment of David Bortolussi as the new chief executive officer.

Mr Bortolussi will be starting work in Sydney in the new year.

He has an extensive experience with underwear company Pacific Brands.

He joined Pacific Brands in 2009 initially as chief financial and operating officer taking over as
CEO in 2014.

The publicly listed company now has a total revenue of $1.73 billion and $337 million in sales into China.

Acting CEO Geoff Babidge said they achieved strong growth in liquid milk businesses in Australia and the United States, with sales across the Group totalling $104.4 million.

“Liquid milk sales in Australia were up 14 per cent to $152 million and sales in the US more than doubled compared to the first half of 2019, driven by improved sales velocity in established stores as well as an expanded store footprint,” Mr Babidge said.

“Our targeted exploration of new markets continues – in October we launched infant formula in the city of Hong Kong and in December we launched infant formula in Korea with our partner, YuhanCARE (Yuhan).”

Mr Babidge said they stepped up investment in China label infant nutrition business considerably in the second half of 2019.

They reported sales in a2 Platinum China label infant nutrition of $337 million, double the sales in the prior corresponding period.

They also expanded their presence to 18,300 stores, up from 16,400 stores at the end of the second half of 2019.

US milk revenue grew by 91 per cent.

The long-awaited appointment of Mr Bortolussi comes after the sudden departure of high-profile leader Jayne Hrdlicka last year.

Mr Hrdlicka took about $3.7 million in remuneration.

Mr Bortolussi will be paid a base salary of about $1.7 million.

Board directors were paid a total of about $1 million last year.

The company said it was planning to install solar power on the roof at its milk processing factory at Smeaton Grange and will also convert lighting to more efficient LEDs, saving 164,000 kg of carbon emissions annually.