ATM - A2 Milk Corporation Limited

[winner69]

IMHO this method produces sh!t results.

Probably does mate but if it works for MAC it'll work for me as well.

[ziggy415]

[QUOTE=NT001;512461]FWIW I pulled the following trading totals in ATM from Yahoo.com for the six months April 17-Oct 17, correlating them with the fall in share price over that period.

April 17-30 (10 days) 13,774,100 shares SP fall 85c to 81c

May (22 days) 44,229,000 80c to 78c

June (21 days) 50,863,000 78c to 69c

July (23 days) 21,331,400 70c to 65c

August (21 days) 21,907,000 63c to 64c

September (22 days) 25,193,500 62c to 58c

October 1-17 (13 days) 8,686,800 59c to 55c

Six-month total 185,984,800 85c to 55c

Trades equivalent to 28% of the company’s 660,066,979 shares on issue have taken place in six months.

There were three days, in May-June, when trades exceeded 10m shares, and there have been three other days when they were approx 6m or above. The last really big trading day was 26 August (8.25m)[ bang on information NT but with all these sells whose buying without triggering the substantial holding requirement

[ziggy415]

[QUOTE=NT001;512461]FWIW I pulled the following trading totals in ATM from Yahoo.com for the six months April 17-Oct 17, correlating them with the fall in share price over that period.

April 17-30 (10 days) 13,774,100 shares SP fall 85c to 81c

May (22 days) 44,229,000 80c to 78c

June (21 days) 50,863,000 78c to 69c

July (23 days) 21,331,400 70c to 65c

August (21 days) 21,907,000 63c to 64c

September (22 days) 25,193,500 62c to 58c

October 1-17 (13 days) 8,686,800 59c to 55c

Six-month total 185,984,800 85c to 55c

Trades equivalent to 28% of the company’s 660,066,979 shares on issue have taken place in six months.

There were three days, in May-June, when trades exceeded 10m shares, and there have been three other days when they were approx 6m or above. The last really big trading day was 26 August (8.25m)[ bang on information NT but with all these sells whose buying without triggering the substantial holding requirement
omg dont drink and post...i,l get back to ya

[winner69]

[QUOTE=ziggy415;512492]
omg dont drink and post...i,l get back to ya

What, too much A2 bad for you

[ziggy415]

[QUOTE=ziggy415;512494]

What, too much A2 bad for you
nah..was trying to say top info NT but fingers went one way and brain didnt move at all.....was just wondering who was doing all the buying with no one triggering substantial shareholder notice

[Harrie]

[QUOTE=winner69;512495]
nah..was trying to say top info NT but fingers went one way and brain didnt move at all.....was just wondering who was doing all the buying with no one triggering substantial shareholder notice

My guess would be fund managers (long term kiwisaver funds), with less than 5% and a multitude of small investors seeing that 55c is pretty good value, worth a crack based on perceived growth expectations, and sharebroker price targets around the 70c to 80c range. I am predicting that Milford will not buy much more in the near future given that it is getting closer to the 20% of issued capital mark and the liquidity issue inherent in the shares.

[winner69]

Appears as ATM is slowly having a lower weighting in some Milford Funds.

Probably a combo of both ATM price decline and Milford not topping up anymore (buying other things wih their inflows instead)

[MAC]

Some tend to try and build risk into a DCF base case like Forsyth Barr very often do, but that just leaves a prospective investor in a position where they must then analyse very carefully for themselves exactly where the analyst has been fair or unfairly conservative. It means their valuations can be very often a bit low too.

Some prefer to apply company set goals and targets and forecast beyond there based on available market analysis and product cycle growth curve estimates for each market and product. At the end of the day the company is the closest to the business, they may not be correct and there are always unknowns, they may perhaps though have the best window seat.

But, at the end of the day if anyone is trying to use DCF to model short term (under six month) moves in share price, forget it, there are much better type of model for that, DCF won’t help you with that much.

6373

[nextbigthing]

Appears as ATM is slowly having a lower weighting in some Milford Funds.

Probably a combo of both ATM price decline and Milford not topping up anymore (buying other things wih their inflows instead)

Yes isn't it great that they don't see a need to average down from their massive overall buy in at around 80c. Milford must have good faith in the company which is great. Unless you're trying to buy in cheaper still aye Winner :cool:

[winner69]

Yes isn't it great that they don't see a need to average down from their massive overall buy in at around 80c. Milford must have good faith in the company which is great. Unless you're trying to buy in cheaper still aye Winner :cool:

Probably the manager cursing under his breath hoe he got into this situation and hoping like hell somebody offers 80 cents to takeover A2

At least same fund not down on XRO yet

[NT001]

Interesting to re-read what Brian Gaynor wrote in a sharemarket review in the Herald of 5 July. Here are the comments he made relevant to A2MC, whose shares had just fallen by 10c to 70c in the preceding five weeks.

The NZX MidCap Index appreciated 17.9 per cent in the latest June 2014 year...

The top performing mid cap companies have been Diligent with plus 2467 per cent, A2 Milk 1050 per cent and Pacific Edge 625 per cent...

Company earnings are the sharemarket's most important driver even though a small number of companies may be an exception to this rule. Xero and the other loss-making technology companies - both here and overseas - are obvious examples of these exceptions.

[MAC]

Yep, the long term value in ATM is in the value proposition and the gross margins.

Do you find the ATM reports difficult to dissect though, would be more content if they also reported ‘underlying profit' ie before intercompany charges.

But, having just gone from operating in a single market to four in just two years, the potential flood of all that concurrent return in earnings downstream is what values ATM.

6374

[see weed]

Buyers building up. Just got some at 56c. Is this the turning point?

[winner69]

Some tend to try and build risk into a DCF base case like Forsyth Barr very often do, but that just leaves a prospective investor in a position where they must then analyse very carefully for themselves exactly where the analyst has been fair or unfairly conservative. It means their valuations can be very often a bit low too.

Some prefer to apply company set goals and targets and forecast beyond there based on available market analysis and product cycle growth curve estimates for each market and product. At the end of the day the company is the closest to the business, they may not be correct and there are always unknowns, they may perhaps though have the best window seat.

But, at the end of the day if anyone is trying to use DCF to model short term (under six month) moves in share price, forget it, there are much better type of model for that, DCF won’t help you with that much.

6373

What's that diagram meant to tell me

[Harrie]

It seems that Fonterra is struggling in the Aust market despite discounting reasonably heavily (SST article) , yet A2 corp is going from strength to strength seemingly.
I have a view but interested in others views.

[Hoop]

Buyers building up. Just got some at 56c. Is this the turning point?
No point in answering your question..see weed :)..as you have already bought into a down trending stock during a market relief rally....

[hilskin]

Looks like 1 ltr of a2 fresh milk is being sold on the jingdong website for $12 nz dollars. You will also see A2 baby formula listed along with some interesting books for the chinese to learn more about A2 milk. A translation of the below page also shows they are doing a Buy 1 get 1 free promotion for the fresh milk. Shame we can't see the amount being sold.

http://search.jd.com/Search?keyword=a2%20milk&enc=utf-8

[winner69]

No point in answering your question..see weed :)..as you have already bought into a down trending stock during a market relief rally....

Hoop - but I have that feeling that it HAS turned and we are on to something BIG here. Just some little signs that were there on Friday afternoon and the spurt today has the gutometer getting excited.

[hilskin]

In case we all forgot, this is what the baby formula factory looks like. Taken from 3 News some time back.
6375

[NT001]

Looks like 1 ltr of a2 fresh milk is being sold on the jingdong website for $12 nz dollars. You will also see A2 baby formula listed along with some interesting books for the chinese to learn more about A2 milk.

I picked up a copy of the "Don't Drink A1 Milk!" book (but not from this site). It's by an American, Brent Bateman, a human health campaigner who now lives in Thailand. It's not very well written, could have done with a decent editor, is self published and draws heavily (with acknowledgements) on Keith Woodford's book. If you've got the Woodford book (advertised below it), you definitely don't need this one. But it's interesting that someone out there who is not connected with A2MC is pushing their barrow for them.

[winner69]

Hoop - but I have that feeling that it HAS turned and we are on to something BIG here. Just some little signs that were there on Friday afternoon and the spurt today has the gutometer getting excited.

58 now ...that TA gutometer working well

The 54/55 WAS the bottom

Back to 'fair value' ....hopefully MAC's 90 whatever and not my 69 cents

[Hoop]

58 now ...that TA gutometer working well

The 54/55 WAS the bottom

Back to 'fair value' ....hopefully MAC's 90 whatever and not my 69 cents

It takes me a while to get excited :)...more than 61c will do it.....

[MAC]

Hmmm, after the buy out of Wiseman I had thought that ATM had price ranged tested the market in the UK, had settled on a long term retail price, and now it was all about growing market share at that settled price from the twenty a2 converted farms.

But, today the UK retail price is back up to the upper ranged limit, perhaps a nice sign of forward confidence.

The a2 price is £1.99 per 2.0L, compared with say Tesco (home brand) £1.00 per 2.27L (4 pints)

6378
a2 Whole Milk 2.0L (99.5p/L)

6379
Tesco Whole Milk 2.27L (44p/L)

[ratkin]

Normal milk in tesco supermarket UK apx .90 nz cents per litre
Normal milk in NZ supermarkets apx 2 dollars 50 a litre

Why when we have all the cows do we have to pay nearly three times as much for milk than UK consumers.

[MAC]

It was done here too, Fonterra still add it as far as I’m aware, happy to be corrected.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10834725

New Zealand fresh milk prices are high because we are paying an equivalent international milk powder market price. Milk here is value added and exported, why would any company sell it in local supermarkets at all unless they could get a similar export level gross margin.

Edit: Permeate contains lactose and a1 protien, so you get a nice double dose in your cheap milk.

[stoploss]

It was done here too, Fonterra still add it as far as I’m aware, happy to be corrected.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10834725

New Zealand fresh milk prices are high because we are paying an equivalent international milk powder market price. Milk here is value added and exported, why would any company sell it in local supermarkets at all unless they could get a similar export level gross margin.

Edit: Permeate contains lactose and a1 protien, so you get a nice double dose in your cheap milk.

that doesn't add up Mac , if we are paying an equivalent international milk powder market price , Please explain since the dairy prices came off 40 odd % since January why we are yet to see a milk price drop at the supermarket ????

[Jasemc]

I think I remember from frontera that milk prices are set by what the market in nz will accept not international prices. Basically they make lots because people will still buy. Sometimes they do a pr line like we will reduce our price but not often. Then of course what do supermarkets make as a mark up, they may pay less but keep price the same.

[biker]

that doesn't add up Mac , if we are paying an equivalent international milk powder market price , Please explain since the dairy prices came off 40 odd % since January why we are yet to see a milk price drop at the supermarket ????

As I understand it, Fonterra didn't raise the local price to match the previously high international price, so now they see no imperative to lower it.

[Fisherking]

In New Zealand the milk price is controlled by Fonterra - if the supermarkets don't like it, they don't get it.

Utter rubbish - there is significant retail margin in milk in NZ, this is the reason ATM will find it difficult to crack the NZ market.

[MAC]

In New Zealand the milk price is controlled by Fonterra - if the supermarkets don't like it, they don't get it.

Utter rubbish - there is significant retail margin in milk in NZ, this is the reason ATM will find it difficult to crack the NZ market.

Why would ATM ever want to crack the NZ market, they have shown no interest in re-negotiating the Fresha agreement, nor should they, the market is small, and they can and are making considerably more by value adding a2 milk as infant formula and exporting it.

[The Grinch]

http://www.nzherald.co.nz/business/n...ectid=10834725 (http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10834725)

New Zealand fresh milk prices are high because we are paying an equivalent international milk powder market price. Milk here is value added and exported, why would any company sell it in local supermarkets at all unless they could get a similar export level gross margin.

Edit: Permeate contains lactose and a1 protien, so you get a nice double dose in your cheap milk.


Wow, this article is super negative on milk permeate - jesus "snot like substance" blinkin heck its only liquid form milk sugars + minerals which are extracted in production of whey protein concentrate (WPC) or Milk Protein Concentrate (MPC). Better than them dumping it.

Off topic I know but interesting to see such a one sided perspective.

[NT001]

Why would ATM ever want to crack the NZ market, they have shown no interest in re-negotiating the Fresha agreement, nor should they, the market is small, and they can and are making considerably more by value adding a2 milk as infant formula and exporting it.

Totally agree, MAC. Besides, it's preferable to avoid a direct confrontation with Fonterra in Fonterra's home territory which would be mutually destructive. Let sleeping dogs lie in NZ.

[MAC]

And NT, if they ever get to a point where they have maxed out the export market for a2 infant formula, and let's face it that's probably a few if not many years away, the next product of the rank with the next highest gross margin is very probably a2 milk processed into a2 whey protein concentrate (WPC) for export.

Imagine that market of really quite health focused gym going folk wanting a2 rather than a1 WPC.

[Jasemc]

Here comes the big buying at 58 cents . $1.00 by XmasXmas

[see weed]

Here comes the big buying at 58 cents . $1.00 by XmasXmas

Yeah, got the same feeling yesterday and positive agm next month up up an away.

[nextbigthing]

Significant volume* at a higher price today. Isn't that usually the point TAers get excited about?

You might need to sell some of those BRM and buy ATM instead Winner.

* Still no SSH from either side

[winner69]

Significant volume* at a higher price today. Isn't that usually the point TAers get excited about?

You might need to sell some of those BRM and buy ATM instead Winner.

* Still no SSH from either side

Go back a few posts ....Hoop has already shot me for being stupid but I happy with this going to 60 cents and then 70 cents and then overshooting my value of 69 cents to 80 cents and then 90 cents and maybe even a buck sooner than later if the big takeover happens

Whats this BRM you mention

[ziggy415]

Go back a few posts ....Hoop has already shot me for being stupid but I happy with this going to 60 cents and then 70 cents and then overshooting my value of 69 cents to 80 cents and then 90 cents and maybe even a buck sooner than later if the big takeover happens

Whats this BRM you mention
I think he meant BMW

[nextbigthing]

I think he meant BMW

Negative, Barramundi - ticker BRM.

[ziggy415]

Negative, Barramundi - ticker BRM.
still think he meant BMW, roumoured winner has a few

[Jasemc]

Still big buying and no notice. They have cleaned up the 54-57 sellers now the 58 is target. A notice must be close.

[Harrie]

Still 500k of shares to depose of at 58c and only 200k of shares interested at 57c with a volume of 1.3 mil sold today.
No buyer is getting too enthusiastic at the moment but maybe it will pick up as we move towards the AGM. Still a lot of selling pressure around the 57 58c mark

[Jasemc]

Yeah big trades off market. Someone is accumulating so I think 5 percent ssh is what we will hear.
They would have ssh by now if they were above 5.

[Jasemc]

As I speak big trade on market 58. The move is on. Price driven down now they buy.

[Harrie]

Yes I see it at 58c but not at 78c Jasemc! (wistful thinking)

[Jasemc]

Yeah bit ahead . Fixed back to 58.

[see weed]

It gave me a nice warm fuzzy and excited feeling when that 1.1 million buy order was placed at 58c late this afternoon.

[gv1]

Wish had some dough on this one.

[see weed]

Wish had some dough on this one.

It is not too late. sp has a fair way to go yet.

[MAC]

http://www.theaustralian.com.au/business/perich-empire-to-pour-100m-into-dairy-operations/story-e6frg8zx-1227102856618

Hypothetically that A$100M Perich have available for investment in the dairy sector would buy another 29% of the a2 milk company at these levels.

They can’t though grow an empire with only one or two companies I guess, and perhaps at 17% they are already at their diversification limit, who knows, Perich also seem more interested in growing ventures from the ground up with seed capital rather than investing in going concerns, but still some of that cash may find its way into ATM, they are after all very bullish on the a2 milk company, time will tell.

[NT001]

Maybe this news item in today's The Australian (paywalled) helps explain what's been going on with the ATM share price lately. The timing is interesting. As I've suggested previously, the Perich family look like the most likely candidate for a takeover of A2MC, rather than one of the big international players.

They own 60% of Australia's Freedom Foods which is the biggest single shareholder in ATM with nearly 19%. Their Lepparton dairy farming operations were among the early suppliers of A2 milk in NSW. Although this report makes clear the family are backing dairy products generally, not just A2, the last paragraphs give an interesting insight into their strategy and their belief in the superiority of A2.

Perich empire to pour $100m into dairy operations


The Australian (http://www.theaustralian.com.au/)
October 27, 2014 12:00AM

THE billionaire Perich family is working on ploughing as much as $100 million into its dairy empire in a bid to capitalise on soaring demand for milk products in Asia and to encourage more farmers to return to the industry.
Family patriarch Tony Perich, who is managing director of the Perich Group, said the spending would be across its suite of companies, including new milk manufacturing plants, new products and buying up farms.
The Perich family’s Leppington Pastoral Company milks more than 2000 cows at its state-of-the-art dairy near Bringelly in western Sydney.
It also has a 60 per cent stake in listed food company Freedom Foods, which makes allergen-free breakfast cereals, as well as fresh and long-life milk beverages and seafood.
Freedom in turn owns a stake in the New Zealand-listed A2 Milk Corporation, which makes high protein milk that is easier to digest.
The family’s wealth in this year’s BRW Rich List topped $1 billion for the first time, putting it among the 40 billionaires in the nation.
“I can tell you we are looking to go bigger into dairy ... I believe in the industry,’’ Mr Perich told The Australian.
“We will probably put about $100m into it. That depends if we can get enough milk. But if we have to, we will.’’
In April, Freedom’s Pactum Dairy Group announced an agreement to supply premium long-life milk to Bright Dairy, one of China’s largest dairy *companies.
It also supplies to A2 Corporation, New Hope Dairy in Chengdu, Shenzhen JLL in Guangzhou and is in advanced negotiations to sell fresh Australian milk on the booming Ali*baba online retail platform in China.
Earlier this year, A2 struck a deal to supply fresh milk direct to homes in Beijing, Shanghai and Guangzhou through Chinese online retailer Jingdong.
Pactum is now expanding its Sydney operations at a new site in Ingleburn that will open next year, as well as growing capacity at its Shepparton plant in Victoria. In August it bought a $4m neighbouring property to its Shepparton plant to more than double its land size.
Morgans analyst Belinda Moore said last month that it expected to see “a large step change in Pactum’s margins in FY17’’ from the Ingleburn investment.
“Now we are encouraging farmers to come back into the industry by exporting overseas. We do believe there is a big market for UHT and long-life milk. If you have a modern factory and keep your costs down, I believe you can certainly compete in the market overseas,’’ Mr Perich said, adding that he was passionate about the future of the dairy industry.
“We have the best farmers in the world, but they don’t get *treated like that. There is too many people going bankrupt, committing suicide in the farming industry because they are not getting a fair return on their *product. And that is not right,” he said.
Freedom Foods is on the lookout for further Chinese partners for its dairy business and Mr Perich said he and his brother Ron as well as chief executive Rory *Macleod had visited China to meet the company’s current and potential new partners.
“Why did my brother and myself go over to China? Because they want to meet the owners. After talking with them, they were very happy with us. They saw we were genuine farmers. You have to go over and see these people,’’ he said.
“If you can be honest with the Chinese and not try to put one over them, they will be very loyal to you. I think we trust them more than they trust us. That is a *problem.’’
Freedom’s share price has risen from about 75c in April last year to as high as $3.25 at the start of last month. The shares closed on Friday at $2.87.
Mr Perich said the family would never sell below the 50 per cent level.
“Our management knows that if we drop below 50 per cent, we are out of this company. Unless we can keep controlling the direction where we think it should go, we would not be involved,’’ he said.
But he added that it was *important the company had an independent board.
“We have an independent chairman and we like to have some independence — that is important.’’
Malcolm Riley, head of nutritional research at CSIRO’s Animal, Food and Health Sciences division in Adelaide, claimed in April that some claims made about the health benefits of A2 milk were “staggering”.
A2 contains a different type of protein from regular milk: beta-casein A2.
Asked about the comments, Mr Perich replied: “All milk is good, but A2 milk is better for some people and you can feel the difference. Try it,” he said.
“We know there are benefits in it, but to get that proven, that takes years.
“What I am saying is, you don’t have to believe it. But once you go on to A2 milk and you have drunk it for a month, you will feel *different. A2 milk will never *rubbish ordinary milk. All milk is good. It’s just A2 is better.’’

[NT001]

Hah! I see you just beat me to it MAC. I was just trying to get around the paywall barrier I ran into.

[MAC]

Hah! I see you just beat me to it MAC. I was just trying to get around the paywall barrier I ran into.

No worries, it does seem with The Australian that if you google for articles you get them for free, but the direct link becomes blocked for some reason, just one of those random acts of internet.

[Kiwi]

I was in Byron Bay two weeks ago and was amazed at the amount of A2 milk available in the supermarket.
Was able to try the light blue for several days and I'm sure I felt better in the tummy region.
Unfortunately I cant get it here in Palmerston North at the moment.

[BFG]

I was in Byron Bay two weeks ago and was amazed at the amount of A2 milk available in the supermarket.
Was able to try the light blue for several days and I'm sure I felt better in the tummy region.
Unfortunately I cant get it here in Palmerston North at the moment.

I picked the regular stuff up at Countdown a week ago. Pretty good stuff, but going back to lactofree when it's available.

[nextbigthing]

So let me get this straight

1) A while ago Freedom Foods (majority owned by the Australian Perich family) publicises a statement that they 'retain the right to sell down their substantial ATM holding', concerning some in the market even though it was really just a hollow statement.

2) ATM shares undergo a (IMHO) rather suspicious regular pattern of trading driving the price down in which time no SSH notices are issued from buyers or sellers (barring the earlier ones from Milford buying)

3) This trading didn't occur on Australia day

4) Over the last few days comments have been by others on the site that the selling appears to have stopped (price has since appreciated slightly).

5) A couple of days later the Perichs claim they have $100m to spend up on 'dairy investments' in a major article that very much talks up their love and belief of A2.

If that's just coincidence then it's very uncanny - chances are probably similar to winning lotto.

NBT

[nextbigthing]

I picked the regular stuff up at Countdown a week ago. Pretty good stuff, but going back to lactofree when it's available.

Excellent. Please let us know what you decide to have for dinner.

[BFG]

Excellent. Please let us know what you decide to have for dinner.

The Next Big Thing that wanders into my yard, prepared with a fine white sauce made with creamy A2 :)

[NT001]

If that's just coincidence then it's very uncanny.

NBT

Coulcn't agree with you more NBT

[Harrie]

NT. IMHO I don't think Freedom will make a T/O bid any time soon although they certainly may increase their shareholding higher than where they are at the mo. I really do not see any immediate imperative to do this. Fairly easy to increase shareholding currently though by getting the weak sellers to off load around the 59 mark, then excite a few more by gradually upping the buy price up into the low 60's. If Perich is wanting a bigger exposure to dairy then he won't be doing it through Freedom foods and whatever entity he is doing this through may be below the 5% threshold, if they are indeed doing it at all despite their positive comments coming through about A2. Interesting to see what happens next week but I am not expecting much

[NT001]

I agree Harrie, as I said above (2283) I've always seen see the Perich family as the most likely source of a takeover move, not Freedom which would appear to have its own expansion plans. And not in the short term. But Perich would probably be looking to mop up weak-selling A2MC shares as you say. Freedom shares were quiet today.

[MAC]

Well, it seems that the a2 fresh milk price in china has settled at 59yuan up from 49yuan, so I’ve adjusted my numbers for 2015 and 2016 revenues as below;

http://item.jd.com/1199167.html

http://www.farmonline.com.au/news/ag...t/2712968.aspx (http://www.farmonline.com.au/news/agriculture/agribusiness/general-news/chinas-aussie-milk-thirst/2712968.aspx)

ATM forecast volume for 2015: 3,000,000 1 litre bottles
ATM forecast volume for 2016: 6,000,000 1 litre bottles
Jingdong Retail Price: 59yuan = NZ$12.39

The internet retail price in China would have probably been agreed by ATM to maintain a minimum gross margin after transport costs, Jingdong margins and overheads.

COGS overall are likely around 65%, as per fresh milk in Australia, although it could well be a lot better than that given the opportunity value of the market.

This provides for;

2015 gross revenues = 3,000,000 x 12.39 x 0.35 = NZ$13M
2016 gross revenues = 6,000,000 x 12.39 x 0.35 = NZ$26M

Not a bad windfall market at all when one considers analyst consensus total revenues for ATM are FY15 NZ$149M and FY16 NZ$202M.

Thus, this new market may well represent 26/202 = 13% of total revenues in just two years.

A new market every year, it’s up and away with this company.

[blobbles]

Well, it seems that the a2 fresh milk price in china has settled at 59yuan up from 49yuan, so I’ve adjusted my numbers for 2015 and 2016 revenues as below;

http://item.jd.com/1199167.html

http://www.farmonline.com.au/news/ag...t/2712968.aspx (http://www.farmonline.com.au/news/agriculture/agribusiness/general-news/chinas-aussie-milk-thirst/2712968.aspx)

ATM forecast volume for 2015: 3,000,000 1 litre bottles
ATM forecast volume for 2016: 6,000,000 1 litre bottles
Jingdong Retail Price: 59yuan = NZ$12.39

The internet retail price in China would have probably been agreed by ATM to maintain a minimum gross margin after transport costs, Jingdong margins and overheads.

COGS overall are likely around 65%, as per fresh milk in Australia, although it could well be a lot better than that given the opportunity value of the market.

This provides for;

2015 gross revenues = 3,000,000 x 12.39 x 0.35 = NZ$13M
2016 gross revenues = 6,000,000 x 12.39 x 0.35 = NZ$26M

Not a bad windfall market at all when one considers analyst consensus total revenues for ATM are FY15 NZ$149M and FY16 NZ$202M.

Thus, this new market may well represent 26/202 = 13% of total revenues in just two years.

A new market every year, it’s up and away with this company.

Assuming this is correct MAC and Australia and other markets keep growing healthily, likely revenue growth next year is looking pretty good. 30% is possible if not probable?

[MAC]

What I really like Blobbles is that there is just a few months lead in compared with say opening up the UK and US markets which takes a few years for herd conversion, processing agreements, regulatory requirements and to grow a base retail market, all that stuff.

In this case the a2 milk company just packages in NSW as usual and airfreights to an already established home delivery internet retailer in China.

By the way, those figures don’t include ATM’s plans to prospectively airfreight to Singapore, Bangkok and Jakarta also.

Post reporting analyst consensus if for 34% revenue growth, still working up my own estimate.

[blobbles]

What I really like Blobbles is that there is just a few months lead in compared with say opening up the UK and US markets which takes a few years for herd conversion, processing agreements, regulatory requirements and to grow a base retail market, all that stuff.

In this case the a2 milk company just packages in NSW as usual and airfreights to an already established home delivery internet retailer in China.

By the way, those figures don’t include ATM’s plans to prospectively airfreight to Singapore, Bangkok and Jakarta also.

Post reporting analyst consensus if for 34% revenue growth, still working up my own estimate.

Not a bad rate for a company in primary production aye... Hard pressed to find any primary producers in NZ at the moment with such a growth rate and such good sales margins...

[NT001]

My feeling is that it shouldn't take very long at all for the UK operation to show more profit. A2MC has a well established sourcing and production relationship with Muller Wiseman Dairies and is now doing its own marketing, building on the retail network already built up. It has said that consumer demand is already strong. Not as if it's starting from scratch

One thing I can't quite get my head around is the fact that A2MC's four-man board includes Billy Keane, whom A2MC proudly boasts is the former head of Wiseman Dairies (presumably lost his job when Muller's took it over) and is the current chairman of Dairy UK, the dairy sector lobby organisation. Why would A2MC have the head of DairyUK on its board? DairyUK is the enemy. When the results of the Curtin trial came out recently, DairyUK issued a strong statement saying it was a load of crap and proved nothing, and there was nothing wrong with ordinary milk. It used the same argument that has been used by the dairy industry in NSW, that ordinary standard milk is fine because it's got some A2 in it, mixed up with the A1.

And since then, Keane has joined the board of Graham's The Family Dairy, the chief rival and arch-enemy of Muller Wisemans (the partner of A2MC). Looks to me like a right muddle, unless I've missed something.

[NT001]

Sorry, in my second paragraph above, it should have read "A2MC's four-man UK board"

[airedale]

2 million shares passed in an off market transfer today. Are we scraping the bottom of the barrel now?

[MAC]

Nice to see ATM get a wee lift this morning or is that just a technical thing.

The AGM is only three weeks away now, what are shareholders wanting to take away from it this time ?

[Harrie]

Interesting that the SP has lifted by over 5% on just 200000 odd shares? (as at 1:30pm)
ATM SH meeting on 18th Nov. I guess MAC what I would like to get some comment on is as follows:
1. Sales volume growth in UK and USA
2. Underlying profit margin in each of those areas
3. Effect of patents expiring in the short term on ATM's competitive advantage
4. Sales volumes of fresh milk and infant formula in China over the last few months or following registration of Synlait products in China
5. Estimated or revised revenue targets for F/E 2015

[winner69]

It takes me a while to get excited :)...more than 61c will do it.....

Full of anticipation are we hoop .....time to get excited

I'm glad the gutometer was spot on this time ....those large trades on a Friday a week or so were the signal. Good gain already .....hope the momentum continues for a while

[Jasemc]

Nice to see ATM get a wee lift this morning or is that just a technical thing.

The AGM is only three weeks away now, what are shareholders wanting to take away from it this time ?


Usa progress
and and any info on sales in uk china.

[BFG]

Looks your seller may have offloaded their last 2M chunk on Friday with those buyingnow knowing they are finished pushing the SP up again. Game of chess this one is...

[goldfish]

Seller is back, every minute or so sells a few more thousand...piss off.

[see weed]

Seller is back, every minute or so sells a few more thousand...piss off.

Well that little run did't last long. Same thing happened a few weeks back. Selling about 5,000 to 10,000 shares every 3 minutes to slowly push sp down, I thought they had finished these silly little games.

[BlackPeter]

Well that little run did't last long. Same thing happened a few weeks back. Selling about 5,000 to 10,000 shares every 3 minutes to slowly push sp down, I thought they had finished these silly little games.

Just remind me ... who would benefit from artificially keeping the share price low?

As well - already more than half a million dollars volume today, if that's just "play-money" to manipulate the share price, than we must talk some pretty deep pockets.

Discl: at this stage just watching ... don't hold;

[mayday]

Just remind me ... who would benefit from artificially keeping the share price low?

As well - already more than half a million dollars volume today, if that's just "play-money" to manipulate the share price, than we must talk some pretty deep pockets.

Discl: at this stage just watching ... don't hold;

http://dairy.drinks-business-review.com/news/perich-to-invest-100m-in-australian-dairy-operations-271014-4416736

have to keep trying hard to push sp down before some good news are released :)

[airedale]

2 million shares passed in an off market transfer today. Are we scraping the bottom of the barrel now?

And the answer to that question is NOT YET.

[Master98]

will be an interesting close today..... very bullish if it closes 60cps or above on big volume

very bullish? no more patient sold out at the beginning of last month, those so called "growth" stock will not in my radar for a while, bought some more AIR at 1.78 and SPK at 2.82 in the last week dip.

[janner]

will be an interesting close today..... very bullish if it closes 60cps or above on big volume

Did not eventuate ..

Where does that leave us ???

[BlackPeter]

Did not eventuate ..

Where does that leave us ???

I guess the shape of the trend curve looks very similar to other so called growth companies (like WYN, XRO, PEB, to name just a few). Admittedly - they make already a profit (the others don't) , but the PE (around 60) is outrageously high.

I suppose the trend will go up again if & when
- they either manage to get their PE down to acceptable levels (i.e. either increase earnings or drop share price) or
- if shareholders are again chasing the tech growth bubble or
- if they consistently demonstrate a growth rate justifying their current PE (which would mean a growth rate around or north of 50%):
quite difficult to do that sustainably
- if some unexpected / random event happening which would bring A2 milk into the focus of a new group of potential share holders
with deep pockets (like WYN's announcement of their deal with the UAE authorities, which launched their SP ...)

Just my 2 cents.

[janner]

Agree ..

Still accumulating..

Blah Blah for the hundred what evers ....

[NT001]

I think it far more important to ask A2 why they are not making a chocolate milk. Preferably with Valrhona chocolate. With both dark and milk (chocolate) versions. And one with coffee. I would start drinking milk again if this were available. Thanks.

I realise you're joking, but a more practical issue is why baristas and sellers of other specialist products using milk are not being pressured by their customers and educated by A2MC to switch to A2, as some are in Australia. They proudly advertise the fact they are a2-only, partly because they say it makes better coffee.

[airedale]

In a price competitive coffee shop/café market I wonder how much the coffee seller would have to increase the cost of a cup of coffee to maintain profit margin when using the more expensive a2 milk.
Or perhaps increased sales would allow for a smaller profit.
Any coffee shop owners like to comment.

[MAC]

In a price competitive coffee shop/café market I wonder how much the coffee seller would have to increase the cost of a cup of coffee to maintain profit margin when using the more expensive a2 milk.
Or perhaps increased sales would allow for a smaller profit.
Any coffee shop owners like to comment.

I was buying a2 flat whites at the local café when I lived in VIC, it did cost more actually, was a couple of years ago, might have been an extra 20c or something like that.

There are quite a lot of exclusively a2 café’s now though, all they offer in those café’s is a2.

Not sure you'll find any coffee shop owners here, advertising in the local market isn't really important for ATM, would though be interested in any cafe's offering a2 in Christchurch if not too far across town.

http://www.theage.com.au/victoria/a1...523-38ue7.html (http://www.theage.com.au/victoria/a1-coffee-with-a2-milk-has-latte-set-frothing-in-delight-20140523-38ue7.html)

[janner]

Still very positive the share price is holding fairly steady despite heavy selling.

With some occasional very heavy buying .. Hmmmm..

Manipulation ???...

[see weed]

I was buying a2 flat whites at the local café when I lived in VIC, it did cost more actually, was a couple of years ago, might have been an extra 20c or something like that.

There are quite a lot of exclusively a2 café’s now though, all they offer in those café’s is a2.

Not sure you'll find any coffee shop owners here, advertising in the local market isn't really important for ATM, would though be interested in any cafe's offering a2 in Christchurch if not too far across town.

http://www.theage.com.au/victoria/a1...523-38ue7.html (http://www.theage.com.au/victoria/a1-coffee-with-a2-milk-has-latte-set-frothing-in-delight-20140523-38ue7.html)

If you can get five cups of coffee from 2 litres of a2 and you pay $2 extra for a2 2litre, then that is 40c charge extra on each cup of coffee. If you get 10 cups then it's only 20c extra charge. This has given me a good idea, and might visit a couple of cafe's very soon, but will make sure they are close to countdown or other a2 supplier. I will keep you posted.

[see weed]

With some occasional very heavy buying .. Hmmmm..

Manipulation ???...

Will be interesting how far the lastest seller is going to push sp down. The seller, selling about 8,000 to 10,000 shares every 3 minutes for over 5hrs on Friday. Will the seller carry on come Monday? If so, it looks like the seller can choose to push sp down to whatever price they want. Thats ok by me, will just wait and jump back in when they have finished.

[MAC]

Bought in last week at .58, only a smallish holding for now. Don't like the science but the market opportunity is there none the less.

I think you’ll reflect on that quite well Black Knat, buying in at close to two year lows, the company's come a very long way in that time.

[Harrie]

Interesting article MAC posted regarding A2 specifically dedicated cafes in Vic Australia.
The points raised in that article lead me back to my little hobby horse regarding highlighting the fact that a large % of lactose intolerance deemed to represent around 20% of the UK market could be associated with A1 beta casein intolerance and not lactose at all.
Question for the 18th MAC: What is A2 doing in the UK about getting the supposed lactose intolerant to try A2.
If there is no reaction to A2, what a fantastic story that can be made.
Q2: Is there any A2 supply problems in the UK currently?

[BFG]

Our seller has a name finally:

https://www.anzsecurities.co.nz/DirectTrade/dynamic/announcement.aspx?id=3740884

[Jasemc]

Yes finally . end of may is when things started to drop fast.

[rbel038]

whats with this kind of stuff? Can anyone educate me on why this occurs repeatedly.

30-Sep-2014 AMP Capital Investors
(NZ) Limited Share acquisition $1,207,129.64 2,081,258 2,081,258
30-Sep-2014 AMP Capital Investors
(NZ) Limited Share disposal $-1,207,129.64 -2,081,258 -2,081,258

[Harrie]

OK so ANZ have just dumped 14.3 million shares onto the market. They have only got another 37 mil to go!
Suspect as I have been saying that its a mandate requirement...too much exposure in a relatively illiquid investment, trustees not happy etc etc
We should get a fairly good indication over the next week or two whether the selling has stopped there or they are going to continue.
The real issue is that originally at 7.7% of total shareholding you would expect that as part of their due diligence they would have courted some discussion with ATM over future prospects....is it those discussions or just a more conservative stance on "growth" assets?

[Jasemc]

Who has been buying?

[MAC]

I’d be interested Harrie if you have any further gauges for the UK.

We haven’t seen an increase in the number of a2 farms, still twenty, but many of those may be in the process of conversion as demand requires.

Certainly the average retail price is much higher now well into the HY15 reporting period, and the google trends thing is drifting up, it’s only an internet thing, but then ATM tell us it’s an internet marketing game in the UK.

It will be good to get some progress though, are you going to the AGM ?

6435

http://www.google.co.nz/trends/explore#q=%22a2%20milk%22&geo=GB&date=1%2F2014%2010m&cmpt=q

[NT001]

14m shares accounted for. That's about 7% of the 180m-odd ATM shares traded since May. Still waiting.

And how sure can we be that AMP isn't just acting on instructions of a client?

[winner69]

AMP man busy filing forms out today .....lightening up on a lot of investments.

Was something about the future of AMP investment team in NZ, maybe those who have left were the culprits in buying so many dogs.

[winner69]

AMP man busy filing forms out today .....lightening up on a lot of investments.

Was something about the future of AMP investment team in NZ, maybe those who have left were the culprits in buying so many dogs.

[janner]

Who has been buying?


Me !!.. But my pockets unfortunately, are not very deep :)

[Harrie]

AMP man busy filing forms out today .....lightening up on a lot of investments.

Was something about the future of AMP investment team in NZ, maybe those who have left were the culprits in buying so many dogs.

Or it could be the smart guys are leaving and a bunch of idiots are trying to make their mark somehow!
NT. AMP like all managers work in the funds management market under a custodial relationship arrangement with investors. They do not take instructions directly from clients. They operate under their own mandates monitered by trustees.
MAC. No further guages on the UK, whatever that means?, but I do believe it is critical to ATM's SP to demonstrate some meaningful traction in the UK and USA, so any info imparted on that front at the AGM would be appreciated. I will not be at the AGM.

[NT001]

...the google trends thing is drifting up, it’s only an internet thing, but then ATM tell us it’s an internet marketing game in the UK.

The big peak in that graph corresponds exactly with UK media publicity in September for the Curtin trial and interviews with Professor Lal about its significance. She did a great job.

[belted galloway]

AMP man busy filing forms out today .....lightening up on a lot of investments.

Was something about the future of AMP investment team in NZ, maybe those who have left were the culprits in buying so many dogs.

May have something to do with this:

http://www.stuff.co.nz/business/industries/10695587/Super-Fund-drops-AMP-Capital

"The New Zealand Superannuation Fund has dropped AMP Capital as one of the managers of its investments in New Zealand"

[Jasemc]

Must of dropped them for selling a2 shares! :t_down:

[NT001]

Milford hanging in there, though.

[Harrie]

May have something to do with this:

http://www.stuff.co.nz/business/industries/10695587/Super-Fund-drops-AMP-Capital

"The New Zealand Superannuation Fund has dropped AMP Capital as one of the managers of its investments in New Zealand"

AMP does not need to cash up shares held on behalf of the NZSF. Its just that they have lost the management rights so all that is required is a transfer of those rights to manage NZ shares portfolio to another custodian, in this case a custodian of the NZSF. The manager in this case appears to be NZSF internal staff. The shares themselves do not need to be converted to cash so this begs the question, why are shares being sold at all? I suggest AMP could have lost the confidence of a number of funds using AMP as the manager and that in order to stop the flow of funds AMP has needed to drop some of the more "speculative" growth stocks in their portfolio. Its just a theory, although none of these feature in their top 10 holdings in either their NZ shares portfolio or NZ strategic portfolio which are dominated by Fletcher, F&P Healthcare, Infratil and Spark. They could of course run an entirely different mandate for NZSF

[Harrie]

Well thats really interesting. NZSF have increased their SH in ATM by 2.60% by buying another 1.5 mil odd shares.
Probably purchased off AMP! So maybe the guys who left AMP were not as dumb as the ones that took over W69...but then again, I may be speaking a bit early!

[winner69]

Well thats really interesting. NZSF have increased their SH in ATM by 2.60% by buying another 1.5 mil odd shares.
Probably purchased off AMP! So maybe the guys who left AMP were not as dumb as the ones that took over W69...but then again, I may be speaking a bit early!

I don't think there was any 'buying' implied in those announcements ....more taking over shares AMP held .."or something like that

I don't think the ones who left AMP a being replaced, at least in NZ

[Harrie]

I don't think there was any 'buying' implied in those announcements ....more taking over shares AMP held .."or something like that

I don't think the ones who left AMP a being replaced, at least in NZ

I think that the fact that NZSF is increasing its holding whether buying or transferring from AMP is a good sign and with only 6.26% exposure at the moment, there is some room to buy more.
Whether personnel replaced or not, someone in AMP is calling for ATM shares to be sold.(or have been)

[Harrie]

Usual story, seller comes in at around 5pm each trading day and drops a few more onto the market. There is still plenty of selling pressure by the looks but seller seems reluctant below 58/59

[see weed]

Usual story, seller comes in at around 5pm each trading day and drops a few more onto the market. There is still plenty of selling pressure by the looks but seller seems reluctant below 58/59

From memory I think it was less than 26,000. No big deal. Am still accumulating and promoting a2. Have enlightened over 100 people in the last 6 weeks, who have also told their family and friends. More people are drinking a2. Nine business days till agm, then we will all be more enlightened.

[SwampRat]

The last few times the Countdown supermarket shelf has been bare. Sometimes they have some out back. And I see my local New World is now stocking A2 - I did ask them for it a few times.

A big question for shareholders : assuming we want, for the benefit of humanity, to see A1 milk gradually get phased out worldwide - is ATM obstructing this? Or enabling it via making people aware.

And if all A1 disappears, does the ATM business model still stack up?

[see weed]

The last few times the Countdown supermarket shelf has been bare. Sometimes they have some out back. And I see my local New World is now stocking A2 - I did ask them for it a few times.

A big question for shareholders : assuming we want, for the benefit of humanity, to see A1 milk gradually get phased out worldwide - is ATM obstructing this? Or enabling it via making people aware.

And if all A1 disappears, does the ATM business model still stack up?

Good point. You will have your chance to ask that question at agm on 18/11/14 at 2pm.

[Ginger_steps_]

The last few times the Countdown supermarket shelf has been bare. Sometimes they have some out back. And I see my local New World is now stocking A2 - I did ask them for it a few times.

A big question for shareholders : assuming we want, for the benefit of humanity, to see A1 milk gradually get phased out worldwide - is ATM obstructing this? Or enabling it via making people aware.

And if all A1 disappears, does the ATM business model still stack up?

they were forever running out of a2 on the shelves at my local Coles, because they only had a 3 bottle width of shelf space, and the shelves were only restocked x times a day. I have noticed recently that they have gained 2 extra rows....

[blobbles]

they were forever running out of a2 on the shelves at my local Coles, because they only had a 3 bottle width of shelf space, and the shelves were only restocked x times a day. I have noticed recently that they have gained 2 extra rows....

Hopefully a very good indication of Australian growth rate this year!

[see weed]

Usual story, seller comes in at around 5pm each trading day and drops a few more onto the market. There is still plenty of selling pressure by the looks but seller seems reluctant below 58/59

What I have noticed today is every time buyers have been taken out at .59c, they are replaced by another 50,000 to 100,000 buyers coming in at .59c within 5 or 10 minutes. Feels like someone is supporting sp at .59c.

[Harrie]

What I have noticed today is every time buyers have been taken out at .59c, they are replaced by another 50,000 to 100,000 buyers coming in at .59c within 5 or 10 minutes. Feels like someone is supporting sp at .59c.

Yes noticed that too seeweed. Just a classic case of a seller needing to get out for whatever reason and a buyer or buyers seeing value at that level. Buyers perception is that the seller does not want to come down much below the 58/59 mark so until demand picks up from other buyers they seem happy to buy as much as the seller wants to sell at these levels. AMP have plenty to sell yet! I'm hoping that there is a positive spin on the companies operations and projected sales revenue going fwd to give the SP a bit of a boost.

This can happen and I experienced this with Quickstep, a share I hold in Australia recently which develops and produces carbon fibre parts for aviation and for the automotive industry. From the point of view of strength, cost, weight and speed of manufacture this product has an enormous future. The price sat at around 17c for most of the year, then on the basis of a shareholder presentation at the AGM the SP shot up to 24c a 40% jump in a matter of a couple of weeks. No one had worked out and no information was given about the companies expanding growth and opportunities going fwd until the AGM.

[Harrie]

Talking to a NZ fund manager over the weekend and asked him if they had any exposure to ATM.
Response basically was too illiquid and science not yet proven. Asked him why Australians thought otherwise and his view was that it was just a lot of clever marketing. So this is the perception we are going to have to battle against for some time to come.

[MAC]

Talking to a NZ fund manager over the weekend and asked him if they had any exposure to ATM.
Response basically was too illiquid and science not yet proven. Asked him why Australians thought otherwise and his view was that it was just a lot of clever marketing. So this is the perception we are going to have to battle against for some time to come.

Perhaps AMP don’t think the science will be proven, perhaps Milford don’t think the science will be disproven, that’s what make a market I guess. But, debate, debate, debate ---> sales.

[blobbles]

3 million off market. Hopefully the big seller that was outed...

[Harrie]

Would'nt bank on it blobbles, whoever the seller is I think they have lost faith and are looking at cutting their losses IMO. If it is AMP they have a lot more to go!
Of more importance though is who is picking them up?

[Jasemc]

I agree. Who is buying is more of a interest. No ssh notice so i wonder.

[ziggy415]

I agree. Who is buying is more of a interest. No ssh notice so i wonder.
AMP have said they are restructuring and changeing their funds to passive funds...i guess A2 not in nzx 50 so not sure what level of A2 they will keep..if any

[Harrie]

There is a difference between passive and index funds. Passive means that they are not going to manage the portfolio actively but rather strategically.
If they were going to run it as more of an "index fund" then they still have about 35 million shares odd to get rid of because ATM would not feature in the top 50 funds by capitalisation. My take on this is that they will keep ATM for the long term, but just what % is open to speculation.

[NT001]

Ziggy and Harrie

When I checked a while back ATM was not only in the NZX 50 (which it still is) but was actually in the top 30 by market capitalisation. It's cap ranking will have dropped since then, especially after the state-owned energy floats, but it's well up there. Or am I missing something? It seems to me that ATM has to be part of a lot of holdings.

[Harrie]

Ziggy and Harrie

When I checked a while back ATM was not only in the NZX 50 (which it still is) but was actually in the top 30 by market capitalisation. It's cap ranking will have dropped since then, especially after the state-owned energy floats, but it's well up there. Or am I missing something? It seems to me that ATM has to be part of a lot of holdings.

That is correct NT, it is in the top 50 but is at No 50 but that is based on 58c, using the latest info I can see.
Having said that only an index fund may choose to use it although "index" funds do not necessarily follow the index faithfully. Even so at number 50 the exposure would be stuff all to a raspberry, however better at No 50 with exposure to all index funds than not at all!
If AMP is being "strategic" rather than "active" then the index following is not really relevant to them. Its just a matter of how strategic they want to be with ATM.

[NT001]

Thanks Harrie

Interesting that ATM is just clinging to inclusion in the NZX50. I wonder if the buyers and sellers in the 58-60c range may have been managing the SP partly to just keep it within the Top50. They've adhered pretty religiously to that level. Even though not all the index funds stick firmly to the index as you point out, could there possibly be benefits to some portfolio managers in not letting ATM drop out of the top 50?

[Harrie]

Could be a bit of a problem for ATM investors if fund managers religiously followed the index method on the NZX50 NT. At 58c its on the cusp of moving off the NZX50 index. With something like ATM where a few cents could be the difference between retaining or eliminating the stock in an index following fund, with all the transaction and record keeping this would require, its hard to say what the reaction would be. I'm not too sure we should be overly worried about it though as if this did happen, some positve forcasting at the AGM could easily move it back on to the NZX50 index, all it does is increase the volatility of the price depending on how much weight the index funds have in the marketplace.

[NT001]

Here's a bit of good news to cheer those who have been worried that nothing much is happening in Britain to get A2 Milk and its message out to the public there.

http://www.foodbev.com/news/a2-milk-relaunches-into-speciality-marke#.VGMcD2dqPsw

[MAC]

Here's a bit of good news to cheer those who have been worried that nothing much is happening in Britain to get A2 Milk and its message out to the public there.

http://www.foodbev.com/news/a2-milk-relaunches-into-speciality-marke#.VGMcD2dqPsw

Hmmm, expansion to a ‘nationwide’ Sainsbury's listing is really very positive news in itself.

“First to reveal the brand repositioning and new-look 1-litre bottle in-store is Sainsbury's, having secured a new nationwide listing”.

And crumbs, no holds barred marketing, easy to see where that £3m will go.

“The multi-channel trade and marketing activity will include shopper marketing, PR, social media, digital activation and a website relaunch supported by high-profile media doctor Dr Hilary Jones. A disruptive 'Welcome Back to Milk' TV, radio and digital content campaign will launch in January 2015”.

[andrewm]

Here's a bit of good news to cheer those who have been worried that nothing much is happening in Britain to get A2 Milk and its message out to the public there.

http://www.foodbev.com/news/a2-milk-relaunches-into-speciality-marke#.VGMcD2dqPsw

Nice to see, marketing campaign sounds good and design looks great.

[NT001]

Hmmm, expansion to a ‘nationwide’ Sainsbury's listing is really very positive news in itself. And crumbs, no holds barred marketing.


Yes I think it's a very well thought out strategy, which is hard-driving yet avoids going head to head with DairyUK and the mainstream suppliers. Plus, the PR release itself gets the key messages across very clearly, and succinctly explains the essential science. Brilliant.

Incidentally, Dr Hilary Jones is a "he" and is a big name on both radio and telly (ITV’s Daybreak and Steve Wright’s Radio 2 programme). He's very committed to explaining to his audiences the differences between A1 and A2 and why those who have problems with standard milk should try switching to A2.

And wow, I also like the Sainsbury's price - equivalent to about NZ$2.80 a litre. Should be a few pence margin for ATM in there somewhere.

[Harrie]

Here's a bit of good news to cheer those who have been worried that nothing much is happening in Britain to get A2 Milk and its message out to the public there.

http://www.foodbev.com/news/a2-milk-relaunches-into-speciality-marke#.VGMcD2dqPsw

Thanks NT...... Finally someone has been listening! I have harked on about this in many posts, its such an obvious market to get some early runs on the board IMO. Maybe we should now start seeing a bit of boing MAC? Best news for a long time. Be interesting to get a bit more early traction signs at the AGM too MAC

[Harrie]

There we go again...right on 5pm a lump of shares are purchased and sold. This seems to me that the buyer is quite happy to sit around picking ATM up at 59 and 60c as long as there is someone out there willing to sell at those levels. Still think AMP is selling down to meet a mandated target, just a matter of when that target is reached, before buying pressure comes in. Buyer playing a pretty smart game at the mo, but would need to be cognisant of making sure he can fill the order book at these prices before any real buying pressure comes into play. Keen to see what happens next week prior to AGM.

[see weed]

There we go again...right on 5pm a lump of shares are purchased and sold. This seems to me that the buyer is quite happy to sit around picking ATM up at 59 and 60c as long as there is someone out there willing to sell at those levels. Still think AMP is selling down to meet a mandated target, just a matter of when that target is reached, before buying pressure comes in. Buyer playing a pretty smart game at the mo, but would need to be cognisant of making sure he can fill the order book at these prices before any real buying pressure comes into play. Keen to see what happens next week prior to AGM.

Most of the bigger trades of about 450,000 total went through between 12pm. and 3pm. Normal trades from what i can see. Only about under 10,000 went through on closing. But in saying that , I have noticed the priced been supported at 59c to 60c lately.

[BFG]

Never seen such a flat stock out of the penny range with such tight BBs! I'm wondering why the brokers don't just try and settle this off market after watching it go on for so long...

[NT001]

Here's a good background article from a British farming publication that explains the non-mainstream milk market that ATM is on the point of re-entering via Sainsbury's and others. It looks specifically at raw milk, organic milk and A2.

http://www.farmersguardian.com/home/livestock/livestock-features/exploring-novel-markets-for-milk/68531.article

[NT001]

Everything is ominously quiet considering tomorrow is the AGM. What issues are going to be raised?

[Harrie]

Often you get some sort of signal via price movement and No of shares transacted a few days before an AGM if there is good or bad news. No much evidence of either so far....Hmmmm!
Hopefully MAC will come through tomorrow with some insights following the meeting.

[see weed]

Often you get some sort of signal via price movement and No of shares transacted a few days before an AGM if there is good or bad news. No much evidence of either so far....Hmmmm!
Hopefully MAC will come through tomorrow with some insights following the meeting.

Picked up a few more this morning. Good news, bad news, it will all come out in the wash this afternoon.

[fiasco]

Nice, somehow our 'seller' has pulled their 200K sell order off for the immediate term. Will consider purchasing more after the AGM. Look forward to hearing the updates!

[Harrie]

As a shareholder I would like to hear lots of goods news but I always get very suspicious when companies announce promising events(like the UK marketing campaign and having sainsbury on board) just prior to 6 monthly's or AGM's.

ATM did not announce this to the NZX, it came through the farmers guardian in the UK, however I would have thought that this was a pretty significant acheivment and well worthy of an announcement. The fact that they have not made it an announcement is interesting in itself. Maybe they have learnt not to hype the market up following the fact that their growth predictions were woofully short of target in the UK over the last year.
I'm really interested now in what comes out at the AGM.

[Harrie]

Actually, when you look at it, its pretty ballsy to commit UK3 million to marketing A2 milk when sales in the first year apparently were around UK1 mill.
Shows a bit of committment. I'm wondering about supply though as they have only contracted 20 farms so far.

[Harrie]

Actually, when you look at it, its pretty ballsy to commit UK3 million to marketing A2 milk when sales in the first year apparently were around UK1 mill.
Shows a bit of committment. I'm wondering about supply though as they have only contracted 20 farms so far.

[NT001]

ATM did not announce this to the NZX, it came through the farmers guardian in the UK, however I would have thought that this was a pretty significant acheivment and well worthy of an announcement.

Yes, actually that news came out on a trade website, foodbev.com and has not shown up anywhere else in the UK media as far as I can discover. Maybe a2MC wants to release the news generally tomorrow when Sainsubury's actually start putting A2 Milk on their shelves.

Since the company is not listed in the UK they don't have to say anything there, but I sent a message to the UK office saying I thought they should at least be making such announcements through the NZX. No response. Although the news item appeared on foodbev.com it had clearly been drafted by a2MC's PR people. It was extremely well put together as a pro-a2MC announcement, including well-drafted references to the scientific and anecdotal case for a2 and none of the usual media garbage about some people saying it's controversial.

[dingoNZ]

Announcement they are seeking to list on the ASX - more details to come

[Harrie]

Announcement they are seeking to list on the ASX - more details to come

OK can't see that announcement yet, where are you getting that info DingoNZ? Its pretty logical that they should list there IMO

[dingoNZ]

NZX site - https://www.nzx.com/companies/ATM/announcements/257798

[winner69]

OK can't see that announcement yet, where are you getting that info DingoNZ? Its pretty logical that they should list there IMO

https://www.nzx.com/files/attachments/204009.pdf

[blobbles]

Would be smart for our eager seller to wait until the ASX listing happens, I would think. Likely to have a few more buyers when they do list and therefore the price will be better supported, right? Unfortunately they probably have a calendar date based mandate to sell them which doesn't extend to next year...

[NT001]

Announcement they are seeking to list on the ASX - more details to come

They had already hinted at this, I think, and it is certainly logical. Question is, how will it affect the NZ SP? And has the recent downward pressure on the NZ SP been in preparation for this? Maybe so that Aussies can get the shares at a bargain price. Just wondering.

[winner69]

Doesn't look like any guidance forthcoming

But Aussie sales up 38% so far this year - whoopee

So without any actual earnings guidance I'll say - HEAPS

Valuation = HEAPS by a reasonable multiple = $1,10 at half announcement time

[dingoNZ]

Would be smart for our eager seller to wait until the ASX listing happens, I would think. Likely to have a few more buyers when they do list and therefore the price will be better supported, right? Unfortunately they probably have a calendar date based mandate to sell them which doesn't extend to next year...

My guess is Aus instos has a mandate where they can only buy ASX stock ans this allows them to buy into the ATM story.

[winner69]

Shareprice on the move ...like a rocket

Maybe $1.10 by Xmas and not half year

[winner69]

Shareprice on the move ...like a rocket

Maybe $1.10 by Xmas and not half year

Maybe 70 cents by the end of the day .....go you good thing .....yippee

[BFG]

Never seen such a flat stock out of the penny range with such tight BBs! I'm wondering why the brokers don't just try and settle this off market after watching it go on for so long...

Tight BBs means breakout or breakdown. Looks like holders got the former as the ASX will be a liquidity kicker and the company looks to keep expanding at a clip.

Congrats all ;)

[Sideshow Bob]

Maybe 70 cents by the end of the day .....go you good thing .....yippee

Why stop at 70 cents Winner? 75 or 80 at least!

You need more nags to bet on.....

[winner69]

Why stop at 70 cents Winner? 75 or 80 at least!

You need more nags to bet on.....

70 cents today ...... 80 cents tomorrow .... $1.10 by Xmas will do fine

[winner69]

Well it seems I timed the bottom perfectly, however, my buy order at 59c is sitting there lonely and unfulfilled. It appears I was a day too late. :t_down:
68c now marks the 200 day MA, and the resumption of the uptrend. Can it get there?

The bottom was that Friday a few weeks ago when decent buy went through late in the day ...that was the signal for me

[NT001]

All good stuff in this NZX release

https://www.nzx.com/companies/ATM/announcements/257803

Note Babidge says no cap raising with the ASX listing but the wording implies that could come later, by which time there will be heaps of Aussies in there to share the load.

[NZSilver]

Looks like ATM has finally had some good news to break the downtrend and push the SP upwards(formula sales up even with disruption, 38% aus sales up milk, starting to supply uk supermarkets + ASX listing) - will it change the trend though - I think it may be just what ATM SP needed. Could be a good time to buy

[Beagle]

Looks like its worth a punt.

[NZSilver]

Buyers building fast......

[winner69]

Buyers building fast......

Hope you buying heaps more silver

[baller18]

Only wish I could pick dirty bottoms like some of u guys, oh well...

[MAC]

Well I guess we have all read the presentation, but from the floor, the delivery and body language was confident and bullish, perhaps more so than last year’s AGM I thought.

First two opening matters from Geoff were pretty much that the consumers have proved the product, and that the strategy remains one of funding growth in the UK, China, and the US from sacrificed Australian earnings.

There seemed good confidence that the UK ‘restart’ and the completion of Chinese regulatory matters puts both those markets firmly back on track. It was in addition interesting to hear that ATM have had approaches out of China for further product development, the tone suggested it may be a lot of approaches perhaps too.

Geoff mentioned that some shareholders, might have been you NT, had requested that the company perform further human trials, which ATM have obligated to do.

Questions were asked, well twice actually, whether any capital raising was likely, answer was no not in the foreseeable future, all good. I got the impression some were disappointed with that and may have preferred a rights issue, ah well.

A question was asked about dividends, answer was no not in the foreseeable future, but there will come a time when the new markets (UK, US, China) will deliver cashflows for that, all good there too.

I liked Geoff statement about the company becoming an a2 branded company with intellectual property, compared with a few years ago when the company was all about intellectual property with a brand.

It’s a reflection I think that the company will become increasing an international player with or without the IP, and perhaps is an indication that management are confident of entrenchment within the international markets during the duration of patents life.

I really do get the impression this year that the a2 milk company is now very much an international company.

All in all a good AGM, regards, Mac

[baller18]

Could I have your crystal ball please winner? it might indeed finish at 70 cents

[Jasemc]

So when they list on ASX how does that work for current shareholders in NZ? Do they issue shares in australia or What? Thanks a bit lacking in Knowledge.

[NZSilver]

Only wish I could pick dirty bottoms like some of u guys, oh well...

I have never held but picked some up at 64 winner. Kinda figured I missed the small initial rise and didn't get in at the bottom, but feel de-risked at 64 as trend is looking to break/be broken, where as at 59/58 still could have gone lower (was still in a down trend).

Fundamentally - read lots of evidence re ATM milk, including the a2 book by Keith. Very interesting stuff but I think it really need more research to confirm benefits. But I really think there is something there. Looks like company is sound financially to.

[mayday]

Holy Cowly...15% by far :t_up:

[Ginger_steps_]

Woohooo back in the green thanks to some top up action 3 weeks ago - go baby! Oh and congrats to SeeWeed - the a2 warrior! :t_up:

[mayday]

So when they list on ASX how does that work for current shareholders in NZ? Do they issue shares in australia or What? Thanks a bit lacking in Knowledge.

current shareholders can be relieved

....Mr Babidge confirmed that a2MC would not seek to raise any new capital in
conjunction with the proposed ASX listing.....

[blobbles]

So when they list on ASX how does that work for current shareholders in NZ? Do they issue shares in australia or What? Thanks a bit lacking in Knowledge.

Same number of shares etc (no new issues) just a second market for the shares to be traded on. There will likely be a lot more interest (and potentially higher SP) due to the popularity of the product in Australia. A smart move which will probably push the SP higher IMHO positioning them well regarding any future capital raisings (which they are unlikely to need as they are already profitable and growing more profitable every day, just taking the Australian market).

[MAC]

From the AGM, “a2MC Australia’s total sales from July to October 2014 have grown +38% in AUD on PCP”, but one must be mindful of the AUD. A good positive AGM, all is on track as far as I’m concerned, no change to my FY15 valuation as it stands.


Base Case Valuation: FY15 $1.10

Sensitivity Analysis:

Base Case (as below) $1.10

ATM Revenue Target Six Months Early (HY15 NZ$230M) $1.25

ATM Revenue Target Six Months Late (HY17 NZ$230M) $0.85

Base Case Basis:

DCF, WACC 11.0%, 30yr PG 3.0%, NZ$230M in revenues at FY16 as estimated by the A2 Milk Company, a continuation of 50% price point premiums, a continuation of gross margins at 35%.

[Everwood]

Great news, and it is nice to be back in the black with price rise today.

[blobbles]

From the AGM, “a2MC Australia’s total sales from July to October 2014 have grown +38% in AUD on PCP”, but one must be mindful of the AUD. A good positive AGM, all is on track as far as I’m concerned, no change to my FY15 valuation as it stands.

38%?!! In 4 months??!! Man, that is huge. That free advertising from the competition really worked then! So growth rate yoy is looking pretty damn hot then...

Great report, thanks MAC.

EDIT: Actually the 38% is yoy growth, as specified in the release today. 38% growth is much less than shabby still. With the UK coming online in a big way from now onwards, can't see any reason to sell, see big reasons to buy still at this price. In fact, long may the big seller continue to push the price down in the medium term, I will be looking to add more pre Australian listing.

[psychic]

Same ol seller tipping in 50k a time to dampen the mood?

[blobbles]

Good time to buy until ASX listing happens is my feeling. How about everyone else?

Mind you, the big seller could come in at any time and dump us back down to 60c by taking out all the orders at the end of the day... A few eyes will be watching I suspect.

[okay]

Might pick up a bottle of a2 this week. Wont be long before it's time for iced coffees again:)

[MAC]

I’m sticking with the fundamental view I already had retained Blobbles, to keep my shares in the bottom draw and see through the 2016 strategic plan. I’ve held for two years, and really can’t see myself selling anytime within the next couple.

With three international markets coming on stream (UK, China, US), all funded from revenues, with premium milk market price points and margins, there is good foreseeable growth ahead for a few years yet.

What I do like is the prospect of the new seemingly supplementary product markets, infant formula into Australia, fresh milk into china, perhaps further products into China like UHT, acting as a buffer to maintain revenue growth continuation until the UK market becomes profitable at FY16, perhaps the US market a year or two beyond that.

And, beyond that there is a real possibility that more extensive human trials may just push it all along with a gust of wind, certainly there was no hesitancy in speculation about the outcome of those trails today.

[winner69]

ASX a good place for Freedom to dispose of their shares, if that is their intention

That's my story and I sticking to it

[Jasemc]

Does the free trade agreement with china aus help a2 fresh milk sales in the future?

[NT001]

Great day at the office (sitting in the garden in Wellington's gorgeous sun actually).


Geoff mentioned that some shareholders, might have been you NT, had requested that the company perform further human trials, which ATM have obligated to do.


Very pleased about that. I see Babidge highlighted certain research areas including child behaviour which I think will be a cracker - it's a top concern for so many well-heeled parents, and not too difficult to research clinically. They should also be able to nail down the A1 connection with autism (or at least the benefits that many autistic sufferers get immediately after switching to A2) and the link with SIDS, where the researchers are already halfway there - that could be an absolute bombshell. I've heard there's actually quite a lot of research in the pipeline or planned already that is going to knock people's socks off.

[MAC]

Yeah, I was tempted at question time with that one too but refrained, Freedom just seem already flush with cash for the time being with $100M to invest in the dairy sector.

They do seem to be more of a seed capital company but I can't see them discharging much ATM over the coming couple of years, very bullish, certainly their representative was today, it seems more like they wish to form a dairy mega company to me.

[NT001]

Well, here's an interesting announcement about the Chinese moving into a dairying partnership in SE Australia with none other than Freedom Foods and the Perich family, the biggest stakeholders in ATM (Perich dominates Freedom, which has 18% of ATM). No talk of any tie-up with ATM, though.

http://www.sbs.com.au/news/article/2014/11/18/chinas-new-hope-invest-aust-dairy

The timing of this new announcement coincides with the signing of the China-Australia free trade agreement.

This will probably chew up some of Freedom's $100m reserves mentioned by MAC above, and of course some of Perich's virtually inexhaustible resources. So where does this leave ATM?

Freedom said recently it intends to keep a strategic stake in ATM in the medium-term, while keeping the option to "realise capital from the investment to support growth opportunities." It has already made significantly costly moves into the US where it aims to expand into its prime area of interest, the health-foods market.

Perich last month visited China to sew up the deal just announced and said he was ready also to spend $100m expanding his NSW dairying empire to meet demand from Asia.

All this indicates Perich and Freedom have far bigger plans of their own than being part of the ATM story, but they both freely acknowledge the important role of A2 Milk for those who have problems with standard milk.

[winner69]

Well, here's an interesting announcement about the Chinese moving into a dairying partnership in SE Australia with none other than Freedom Foods and the Perich family, the biggest stakeholders in ATM (Perich dominates Freedom, which has 18% of ATM). No talk of any tie-up with ATM, though.

http://www.sbs.com.au/news/article/2014/11/18/chinas-new-hope-invest-aust-dairy

The timing of this new announcement coincides with the signing of the China-Australia free trade agreement.

This will probably chew up some of Freedom's $100m reserves mentioned by MAC above, and of course some of Perich's virtually inexhaustible resources. So where does this leave ATM?

Freedom said recently it intends to keep a strategic stake in ATM in the medium-term, while keeping the option to "realise capital from the investment to support growth opportunities." It has already made significantly costly moves into the US where it aims to expand into its prime area of interest, the health-foods market.

Perich last month visited China to sew up the deal just announced and said he was ready also to spend $100m expanding his NSW dairying empire to meet demand from Asia.

All this indicates Perich and Freedom have far bigger plans of their own than being part of the ATM story, but they both freely acknowledge the important role of A2 Milk for those who have problems with standard milk.

ASX listing ....ideal for quick sell down if their intention ....give the shares to Goldman and hey presto all gone to instos and investors in a day ..... and then a lot more liquidity on the ASX as well

[janner]

This rise in share value is going to make Friday's Comp results interesting..

Eh !!.. percy ???

[see weed]

Woohooo back in the green thanks to some top up action 3 weeks ago - go baby! Oh and congrats to SeeWeed - the a2 warrior! :t_up:

Thanks GS. It was a good meeting and good views of Auckland harbour. I put my hand half up and changed my mind, but before I knew it some young lass had a mic under my nose. Buggar , I'm not a public speaker, so the question was...(1) Would more promotion & sales in NZ be good for a2mc. (2) Have you considered bringing out a new a2 chocolate milk product to help boost sales. The reason I asked q2 was because I promised a customer at countdown last week who could not find any chocolate milk, and said I would ask at the agm. The problem was because I was so nervous of pub. speaking & woman with mic , I could not take in the answer. All n all I got a good positive feeling about a2mc , which I had before the meeting, and would not hesitate in buying more shares in this company. Regards see weed.

[mayday]

FA of A2 milk company looks very positive after several releases today, with numerous potentials in med and long term.

http://www.nbr.co.nz/article/a2-milk-list-asx-first-quarter-2015-bd-165539

see_weed, not sure whether this could answer your first question at AGM.

""Sales in New Zealand remain miniscule and the sole licensee, Fresh Valley, has been told its licence won’t be renewed when it lapses in May 2017.""

[blobbles]

Thanks GS. It was a good meeting and good views of Auckland harbour. I put my hand half up and changed my mind, but before I knew it some young lass had a mic under my nose. Buggar , I'm not a public speaker, so the question was...(1) Would more promotion & sales in NZ be good for a2mc. (2) Have you considered bringing out a new a2 chocolate milk product to help boost sales. The reason I asked q2 was because I promised a customer at countdown last week who could not find any chocolate milk, and said I would ask at the agm. The problem was because I was so nervous of pub. speaking & woman with mic , I could not take in the answer. All n all I got a good positive feeling about a2mc , which I had before the meeting, and would not hesitate in buying more shares in this company. Regards see weed.

Ha haaaa see weed, but what were the answers?

[BFG]

Daory down another 3% last nught. Not much effect on ATM but consequences will start being seen in NZ...

https://www.globaldairytrade.info/

[see weed]

Good little write up in todays herald. NZ shares rose yesterday to a record, led by a2 Milk Co as it flagged a dual-listing on the ASX, sales had grown 38 per cent in the past four months etc. .... Might be in for another interesting day for a2 shares today.

[winner69]

Hope the hype and excitment continues today ......over 70 cents today

[couta1]

Hope the hype and excitment continues today ......over 70 cents today
With a buy in price of 92c I'll be waiting a while yet to break even but I'm patient so all good aye.

[winner69]

With a buy in price of 92c I'll be waiting a while yet to break even but I'm patient so all good aye.

Jeez 92 cents gives a market cap of $600m .....outrageously overvalued at this level. Must be ginormous growth assumptions if anybody gets a valuation above 100

The market does silly things sometimes. Maybe this is one of those times

Even so I hoping for 110 in the near future .....if only because that's doubling money time

Hope the squiggly lines keep going up

[goldfish]

Looks like amp couldnt wait long to start dumping on market. Only what 37 million shares to go. zzzzz

[winner69]

Looks like amp couldnt wait long to start dumping on market. Only what 37 million shares to go. zzzzz

They dumped more or something?

[goldfish]

Im guessing its them, since yesterday with those 50k blocks now today a 200k block and pushing the sp back down to 59c soon.
You would think they could wait for a asx listing instead of trying to dump them on market.
If it is them that is...
Sold mine that i got the other day this morning when i saw what was happening, I was hopeing to hold them long but what can you do eh, better to take profit while its there, ill buy back in when it drops under 59 again...or something else happens.

[bull....]

sorry to rain on ya party but it failed to get back above that resistance of old 66 - 67c anyway great to see sales are going good in aus will need to so they can pay thoses expensive advertising dollars in the US.

[fiasco]

Saw exactly the same event happen, i suspect they are under time constraints so regardless of the ASX they will continue to dump. My average buy was around the .580 mark so will just leave it and hope they will complete their purge soon! May consider topping up when/if it gets back to those levels.

[Harrie]

Thats the way instos work GF, they don't work on logic, they work on self imposed mandates. They have worked out that they want to concentrate on a top down approach to their portfolio rather than a bottom up approach and preferably invest in dividend paying stock rather than stock with potential growth even though that same stock has the potential for paying dividends into the future.
Wait until you see a full roll out of ATM's strategy in the next 3 to 5 years and sit back and enjoy both dividends and SP growth. AMP will be buying back in at a price well above 59c at that time, so capitalise on the discount which is being presented right now, I have. ATM is a 3 to 5 year stock for me, as disapointing as it is to see the SP declining at the mo, I see it as an opportunity without going overboard.
MAC, appreciate the AGM update and your analysis

[winner69]

Harrie, I still think you reading too much into all this and sort of trying to justify to yourself the 'low' shareprice.

The market will be what it will be. Just that not many want to buy above 65 cents (cause they see that a fair value?) and some taking profits. Who knows

Even goldfish sold out today, the ebb and flow of the market

I still want 110 but if it continues to show weakness this week out they go and come back another day.

[Harrie]

Everyone has a different view on fair value W69, depends on how much value you place on future growth potential and the appropriate timing of buying into it. You will never get the timing right, so happy to be there for the long term. . If you believe that its a 110c stock why not continue to hold it, because as sure as hell you are not going to fluke the right time to buy. Traders can do what traders do and take litttle profits and losses, but in my view thats a stupid game to play. If your 51% correct all the time you are a genius.

[winner69]

Everyone has a different view on fair value W69, depends on how much value you place on future growth potential and the appropriate timing of buying into it. You will never get the timing right, so happy to be there for the long term. . If you believe that its a 110c stock why not continue to hold it, because as sure as hell you are not going to fluke the right time to buy. Traders can do what traders do and take litttle profits and losses, but in my view thats a stupid game to play. If your 51% correct all the time you are a genius.

Only 110 because that's double your money time for me

DCF valuation 70/75 cents, even with implied success in UK/China and continued high growth in Australia

Had two guess capex over the next few years, anybody have any idea. Asked before but no response

[blobbles]

I don't think any of us should be surprised here, likely the big seller will keep the SP low until they have finished selling what they need to. Funnily enough because lots of people know this, many will be reluctant to buy in knowing that the SP will remain low until the selling is near its end, extending the time needed to complete the selling. The ASX listing should help with that early next year hopefully.

[Tsuba]

still cheap when snaps thinks it could be the next coke cola

Schnaps I am starting to become very fond of you now. ;)

[MAC]

Thanks GS. It was a good meeting and good views of Auckland harbour. I put my hand half up and changed my mind, but before I knew it some young lass had a mic under my nose. Buggar , I'm not a public speaker, so the question was...(1) Would more promotion & sales in NZ be good for a2mc. (2) Have you considered bringing out a new a2 chocolate milk product to help boost sales. The reason I asked q2 was because I promised a customer at countdown last week who could not find any chocolate milk, and said I would ask at the agm. The problem was because I was so nervous of pub. speaking & woman with mic , I could not take in the answer. All n all I got a good positive feeling about a2mc , which I had before the meeting, and would not hesitate in buying more shares in this company. Regards see weed.

Was sitting right behind you see weed as it turns out, would have said hello if I’d known. May well just have sparked something there with Geoff, what did he say "there might be room for flavoured milk sometime, even chocolate !"

[BFG]

still cheap when snaps thinks it could be the next coke cola

Make it another SUGARY DRINK like Lewis Road Creamery and Robbo will be there in an instant ;)

MAC, once you meet see weed you will never forget him. The eyes cannot unsee and the ears cannot unhear! (In a good way of course) :D

Traders be trading today. #AMPmadtosell

[Harrie]

Was sitting right behind you see weed as it turns out, would have said hello if I’d known. May well just have sparked something there with Geoff, what did he say "there might be room for flavoured milk sometime, even chocolate !"

Possible opportunity here to introduce chocolate flavoured a2 milk in NZ without over emphasising the A2 aspect. let it speak for itself and then promote the A2 benefits later. Small specialised market but an easy one to break into since A2 would not need to promote heavily into it and continue to concentrate on their already targeted markets.

[see weed]

Make it another SUGARY DRINK like Lewis Road Creamery and Robbo will be there in an instant ;)

MAC, once you meet see weed you will never forget him. The eyes cannot unsee and the ears cannot unhear! (In a good way of course) :D

Traders be trading today. #AMPmadtosell

He he, have I meet you? You wouldn't be the M_ _s_ by any chance? Silly me got caught up in all the excitment and bought more at 65c this morning, but my av price is .609c, so can't complain. Next year will be better (6 weeks).

[see weed]

Was sitting right behind you see weed as it turns out, would have said hello if I’d known. May well just have sparked something there with Geoff, what did he say "there might be room for flavoured milk sometime, even chocolate !"

That makes 4 of us from Share Trader at a2 agm. We could of had our own ST meeting on the side. Talked to young lady wearing gumboots at countdown Lynfield this afternoon, and she put her a1 back on the shelf and bought the a2 instead. She said she always likes to try something new. She looked so lost and bewildered with all those a1 milk brands to choose from. I said you could also buy shares in the company, and every morning when eating your wheet bix with a2 you get this nice warm good feeling of being part owner of the milk you are consuming. She said I can't wait to get home to try this new milk. As I was driving away I saw her in rear vision mirror, woman in gumboots, drinking a2 from the bottle . Another one drinks the milk . Another one drinks the milk.

[NT001]

Hey see weed, you should offer your services to Sainsbury's. They might even fly you to London. But then, with ATM pouring 3m pounds into the UK promotion they might just flag away the offer. So it looks like you're stuck with Fresha Valley until 2017. Good luck.

[BFG]

He he, have I meet you? You wouldn't be the M_ _s_ by any chance?

Nooo, of course not... :D :D :D

[NT001]

Can anyone who was at the AGM add any context or detail to Geoff Babidge's reported statement that "sales in New Zealand remain minuscule and the sole licensee, Fresha Valley, has been told its licence won’t be renewed when it lapses in May 2017."?

Such a message to FV must have been preceded by some discussion as to why it is not pushing the product harder on to supermarket shelves, in which case FV had two options - either smarten up, or offer to surrender its licence, which can't exactly be a huge source of income. Since it is apparently determined to hang on to the licence but only provide "minuscule" service, one can only assume FV is in cahoots with Fonterra and under orders from Fonterra to slow down A2 sales in NZ for as long as possible. Which is rather what you'd expect. Fonterra is probably also urging Countdown not to push A2, which may account for some of the empty shelves reported on this thread.

[see weed]

Hey see weed, you should offer your services to Sainsbury's. They might even fly you to London. But then, with ATM pouring 3m pounds into the UK promotion they might just flag away the offer. So it looks like you're stuck with Fresha Valley until 2017. Good luck.

Who or where do we get a2 when fresha valley lose their licence?

[loon]

A2 milk has recently started to be stocked in our local Freshchoice supermarket in Richmond. We tried it for the first time and thought it was pretty good. However, it sells out quickly and takes a long time to come in. I asked the dairy supervisor who said she had ordered it and she just has to wait for the supplier. I am going to e-mail Fresha Valley and ask them to hurry it up.

Also, First NZ Capital 's latest research puts a .55 - .96c range with a 12mnth TP of .73c.

[psychic]

Who or where do we get a2 when fresha valley lose their licence?

Might be a good time to drop in to atm and introduce them to See Weed Milk Distributors Ltd?

[NT001]

Who or where do we get a2 when fresha valley lose their licence?

That's looking a fair way ahead, SW, but presumably ATM will set up a decent system under its own control as in other countries, including low-fat and other variations of A2 Milk - maybe even chocolate milk!

Heaven knows why the early executives of A2 Corp issued exclusive longterm licences that got them into this bind. Part of the reason was that initially A2Corp set up in business simply as the owner of IP, which it licensed out to others, and with no intention to produce or market milk itself. But you would have thought they would attach some performance clauses. For a while there was also another licensee, an organic milk producer who sold through organic outlets, so there was potentially a bit of competition against Fresha, but that one disappeared for some reason. Anyway it was confusing the message a bit to have A2 milk being sold as organic.

[Ginger_steps_]

Can anyone who was at the AGM add any context or detail to Geoff Babidge's reported statement that "sales in New Zealand remain minuscule and the sole licensee, Fresha Valley, has been told its licence won’t be renewed when it lapses in May 2017."?

Such a message to FV must have been preceded by some discussion as to why it is not pushing the product harder on to supermarket shelves, in which case FV had two options - either smarten up, or offer to surrender its licence, which can't exactly be a huge source of income. Since it is apparently determined to hang on to the licence but only provide "minuscule" service, one can only assume FV is in cahoots with Fonterra and under orders from Fonterra to slow down A2 sales in NZ for as long as possible. Which is rather what you'd expect. Fonterra is probably also urging Countdown not to push A2, which may account for some of the empty shelves reported on this thread.
Or it could be same situation as I used to have here - so little a2 shelf space that it sells out before the shelves are restocked... Of course if the supermarket is not getting the milk it's another story. Also, would countdown listen to fonterra when a2 is one of its top selling products in auz?

there seems to be a big chocolate milk following on here - I was under the impression chocolate milk wasn't that popular anymore, but stand corrected. I would have thought ice cream, cheese, yoghurt etc would come first considering there shelf life and popularity. There was some mention of requests from china - wonder what they could be? I'm pretty sure ice cream is huge over there from Chinese guys I have met over the years, can someone on the ground over there confirm that? That's what I'm hoping for anyway, preservative, additive, colour free a2 - I would buy it by the wheel barrow!

[NT001]

Or it could be same situation as I used to have here - so little a2 shelf space that it sells out before the shelves are restocked... Of course if the supermarket is not getting the milk it's another story. Also, would countdown listen to fonterra when a2 is one of its top selling products in auz?


I've talked to shelf-stackers and some of the staff actually assigned responsibility for the quite substantial milk sections in Countdown and Freschoice stores and I get a big range of replies, such as:

1. Someone (not me of course) forgot to order enough.
2. It's on order but the delivery didn't arrive.
3. We've got a case of it out in the coldroom
4. There's not much demand for it, so we don't give it double-row space.
5. It's so popular now that we often run out.
6. We don't order much in because we've heard it's controversial (didn't say who said so).
7. Demand seems to vary, so it's hard to order the correct amount.
8. The lady who does the ordering has been away sick (but all the other shelves are full).
9. What's so special about A2 anyway? Won't another brand do?
10. People ask us what's so special that it costs $4.90 a bottle, but we have no information on that.

My simple line to them is: "a2 has health and digestive benefits over normal milk and some consumers won't accept any other. If you want to keep them coming to Countdown to buy it, then put it on the shelf where it is visible and keep it stocked."
I try to speak to the duty shop-floor manager if possible.

I don't actually know what dialogue may go on between Fonterra and Countdown.

Be aware that a limited number of New World stores are starting to stock A2 as well.

[MAC]

Can anyone who was at the AGM add any context or detail to Geoff Babidge's reported statement that "sales in New Zealand remain minuscule and the sole licensee, Fresha Valley, has been told its licence won’t be renewed when it lapses in May 2017."?

Such a message to FV must have been preceded by some discussion as to why it is not pushing the product harder on to supermarket shelves, in which case FV had two options - either smarten up, or offer to surrender its licence, which can't exactly be a huge source of income. Since it is apparently determined to hang on to the licence but only provide "minuscule" service, one can only assume FV is in cahoots with Fonterra and under orders from Fonterra to slow down A2 sales in NZ for as long as possible. Which is rather what you'd expect. Fonterra is probably also urging Countdown not to push A2, which may account for some of the empty shelves reported on this thread.

He made a comment NT that shareholders had been asking what was intended with the local market, and thus went on to say that the Fresha agreement expires in May 2017 and wouldn't be re-newed, had a sort of wry suggestive smile when he said that actually. Whilst talking on the matter he made a point twice of reminding us all that the Fresha agreement is "non exclusive", perhaps that means we may see some direct marketing earlier than 2017, who knows.

[blobbles]

Or it could be same situation as I used to have here - so little a2 shelf space that it sells out before the shelves are restocked... Of course if the supermarket is not getting the milk it's another story. Also, would countdown listen to fonterra when a2 is one of its top selling products in auz?

there seems to be a big chocolate milk following on here - I was under the impression chocolate milk wasn't that popular anymore, but stand corrected. I would have thought ice cream, cheese, yoghurt etc would come first considering there shelf life and popularity. There was some mention of requests from china - wonder what they could be? I'm pretty sure ice cream is huge over there from Chinese guys I have met over the years, can someone on the ground over there confirm that? That's what I'm hoping for anyway, preservative, additive, colour free a2 - I would buy it by the wheel barrow!

I doubt most Chinese will care TBH, icecream is not "huge in China", it's a luxury food/sweet consumed mostly in the McDonald's / KFC varieties. NZ natural icecream does a good trade throughout all of China though, but again its luxury food in China.

NZ is such a small market, that will be the main reason they don't really care about us or concentrate on us much. When they have UK /USA/China markets to concern themselves with this makes sense. And as a shareholder I support this view.

[NT001]

He made a point twice of reminding us all that the Fresha agreement is "non exclusive", perhaps that means we may see some direct marketing earlier than 2017, who knows.

That's great! Many thanks MAC. An obvious option would be to use the tie-up with Synlait for domestic supply as well as for export, but there are others too. There are farmers in Waikato who I believe have gone all-A2 but don't have a buyer at present. Just taking over Fresha's operation up in the far north wouldn't make much sense - for one thing, it's not well located for widespread distribution. Given what you quote Babidge as saying, I'd expect something to happen well before 2017, even if it's flying supplies in from NSW initially.

[NT001]

A very good report here from Australia's BRW on the ATM AGM.

http://www.brw.com.au/p/business/listing_milk_company_australian_T8u9Hnuq5C4BFT9U9i PSZI

[Beagle]

A very good report here from Australia's BRW on the ATM AGM.

http://www.brw.com.au/p/business/listing_milk_company_australian_T8u9Hnuq5C4BFT9U9i PSZI

Thanks. 38% growth in Aussie is very strong. Thing I like with this is the growth in sales funds future growth unlike many of the other growth companies on the NZX which burn cash at a great rate of knots.

[Ginger_steps_]

I doubt most Chinese will care TBH, icecream is not "huge in China", it's a luxury food/sweet consumed mostly in the McDonald's / KFC varieties. NZ natural icecream does a good trade throughout all of China though, but again its luxury food in China.

NZ is such a small market, that will be the main reason they don't really care about us or concentrate on us much. When they have UK /USA/China markets to concern themselves with this makes sense. And as a shareholder I support this view.
Thanks for the insight, like I said, I was pretty sure, not certain, the Chinese I have met over the years devoured ice cream so I assumed it was very popular - luxury or not. I guess you could put fresh milk etc under the luxury label for chinese as well.
P.s im in Aussie not NZ, and I expect they will release other products here first considering oz is there cash cow.

[winner69]

well all that excitement and exuberance didn't last long did it .... yes shareprice was 69 cents the other day .... hope it wasn't any of you guys that bought at that price .... off course

ASM all over and dusted, nothing more likely to happen for a while so whats going to drive the shareprice up now?

ASX listing unlikely to do much unless Freedom use it a vehicle to sell down or out .... that might created the touted liquidity in Australia. ASX listing done little for SUM, EBO, XRO etc

I given up on my $1.10 .... just take what I can this time around

[Ginger_steps_]

well all that excitement and exuberance didn't last long did it .... yes shareprice was 69 cents the other day .... hope it wasn't any of you guys that bought at that price .... off course

ASM all over and dusted, nothing more likely to happen for a while so whats going to drive the shareprice up now?

ASX listing unlikely to do much unless Freedom use it a vehicle to sell down or out .... that might created the touted liquidity in Australia. ASX listing done little for SUM, EBO, XRO etc

I given up on my $1.10 .... just take what I can this time around

It was to be expected with the large seller I guess, Im taking this as an opportunity to add to my longterm portfolio at a discount. Without the large seller in the future, I believe we just had a good indicator of which direction the price is headed.

[see weed]

Is anyone out there still holding atm? I feel like been left holding the calf. This is starting to feel like Snakk Media. And such a positive agm. Has anyone moooooved on lately?

[Beagle]

I bought in a modest position following the ASM and am looking at a small loss at the moment but I am happy. 38% yoy increase in Aussie is a really big deal and funds a lot of future growth. Patient investors will be rewarded.

[Xerof]

Is anyone out there still holding atm? I feel like been left holding the calf. This is starting to feel like Snakk Media. And such a positive agm. Has anyone moooooved on lately?

I milked a small trade, selling my holding in the auction on Tuesday close at 65, when it became apparent the seller was unmoooooved.

But 'I'll be back'

[blobbles]

I bought in a modest position following the ASM and am looking at a small loss at the moment but I am happy. 38% yoy increase in Aussie is a really big deal and funds a lot of future growth. Patient investors will be rewarded.

Rogers onto it. An already profitable company whose spare cash is being used to enter new markets. Whose current main market has gone from 20% growth to 38%. Whose market value is <4x revenue and getting lower and lower all the time (SP going down while sales go up). It's the sort of investment I have wet dreams about as an investor. Don't let the short term sell down fool you, a major holder is in control of the SP at the moment, keeping the price ~60c.

I am picking the UK market to take off next (next year or two) and if that happens to the same degree as Australia... You will be cursing yourself for selling now. Patience will be rewarded.

Then again if you see an opportunity to make money somewhere else over the next 2-3 months, you *may* be able to buy back in at this price later if this seller is still in control.

[see weed]

Good to hear there is still st feeding the calf. If it goes down any further I'll also be in like flynn.

[Beagle]

Yeah if they go much lower I might have to snapiti up some more, aka double-down :)

[andrewm]

Holding here too seaweed, no hurry to sell and expecting great things.

[NT001]

Just noticed some interesting features in the list of top shareholders in ATM.

In the last list I got from my broker, dated 7 November, there was no mention high up of Geoff Babidge, but he’s listed here as having 10 million shares according to 4-Traders.

So the top of the list (those with over 1% stakes) reads:









Name

Shares

%



Freedom Foods Group Ltd. (http://www.4-traders.com/FREEDOM-FOODS-GROUP-LTD-10354922/)

117,878,629

17.9%



Milford Asset Management Ltd.

97,877,776

14.8%



Clifford James Cook (http://www.4-traders.com/business-leaders/Clifford-Cook-09NNXP-E/biography/)

57,558,701

8.72%



Guardians of New Zealand Superannuation

41,344,622

6.26%



AMP Capital Investors (New Zealand) Ltd.

37,022,083

5.61%



Equity Casa Grande LLC

30,000,000

4.55%



Accident Compensation Corp.

24,356,038

3.69%



Geoffrey Howard Babidge (http://www.4-traders.com/business-leaders/Geoffrey-Babidge-070MYT-E/biography/)

10,000,000

1.52%



Gregory Paul Hinton

8,101,872

1.23%



Ulrike Mclachlan

7,135,163

1.08%

















Maybe Babidge was/is a custodial client of Central Securities Depository which manages 48% of ATM shares but does not feature here. But does anyone know anything about Equity Casa Grande LLC? It’s a Delaware registered company about four years old.

Cliff Cook is of course ATM chairman and the guy who rescued the company with funds received when he sold Metlifecare, and has since put it on the road to success. Gregory Hinton is a former director who acquired 11m shares in 2011 at 28c each in some in-company deal. Ulrike McLachlan is the widow of Dr Corran McLachlan, the scientific genius behind A1-A2, who died of cancer in 2003 just a few weeks after the company’s financial backer Howard Patterson died suddenly, leaving the company suddenly somewhat rudderless for a while.

[BFG]

Were Casa on the last shareholder list? Says a lot being a Delaware based company (tax haven) and most likely a SPV...

[NT001]

Were Casa on the last shareholder list? Says a lot being a Delaware based company (tax haven) and most likely a SPV...

They weren't on my last list, but a lot of shareholders were concealed in the Central Securities Depository list, including presumably Milford. So I don't know how long Casa has been a shareholder. I was hoping someone might help on that. Yes Delaware registration is often (but not necessarily) a bit of a red flag.

[blobbles]

38% revenue growth puts us at what? $150m revenue? Not bad... At current price that's only price to revenue of 2.6... And that doesn't include sales to other markets. If 20m revenue happens in the first year in the US/UK/China... That puts us at $170m, revenue multiple of 2.3.

Just for comparison DIL is currently at 5.4 with a diminishing growth rate. Admittedly they have a large chunk of cash that they can't seem to use for growth, whereas ATM pretty much fully use their profits for growth. Rather be with the increasingly profitable company who can use all new profit growth for sales growth.

[MAC]

38% revenue growth puts us at what? $150m revenue? Not bad... At current price that's only price to revenue of 2.6... And that doesn't include sales to other markets. If 20m revenue happens in the first year in the US/UK/China... That puts us at $170m, revenue multiple of 2.3.

Just for comparison DIL is currently at 5.4 with a diminishing growth rate. Admittedly they have a large chunk of cash that they can't seem to use for growth, whereas ATM pretty much fully use their profits for growth. Rather be with the increasingly profitable company who can use all new profit growth for sales growth.

Seems things may kick on a bit quicker in China now too;

“a2MC is confident that the original market entry plan for infant formula into China can be attained and significant further growth achieved as a result of these changes”

https://www.nzx.com/files/attachments/204209.pdf

[mayday]

Go A2, go!!!! Here we come, China!!!!

[Harrie]

Go A2, go!!!! Here we come, China!!!!

Well the seller does not seem to be that impressed by the announcement. If it is still AMP then there is potentially another 37 mill to sell boys!
If it is AMP then I stick with my supposition that the sales are driven by mandate not logic. How much more good news can there be? Chinese distribution networks increasing, sales up in Aussie, product diversification, dual listing, scientific evidence on the rise, revenue multiple to market cap falling, expanding o/seas markets etc.

[Beagle]

38% revenue growth puts us at what? $150m revenue? Not bad... At current price that's only price to revenue of 2.6... And that doesn't include sales to other markets. If 20m revenue happens in the first year in the US/UK/China... That puts us at $170m, revenue multiple of 2.3.

Just for comparison DIL is currently at 5.4 with a diminishing growth rate. Admittedly they have a large chunk of cash that they can't seem to use for growth, whereas ATM pretty much fully use their profits for growth. Rather be with the increasingly profitable company who can use all new profit growth for sales growth.

Well said.

[BlackPeter]

Well the seller does not seem to be that impressed by the announcement. If it is still AMP then there is potentially another 37 mill to sell boys!
If it is AMP then I stick with my supposition that the sales are driven by mandate not logic. How much more good news can there be? Chinese distribution networks increasing, sales up in Aussie, product diversification, dual listing, scientific evidence on the rise, revenue multiple to market cap falling, expanding o/seas markets etc.

Well, I guess a buyer has typically a different perspective than a holder and / or a seller ...

Looking at the stock - yes some of the promises don't look too bad. However - if I look at the forward PE (60), than the share appears to be currently even at 30+ percent growth rate quite dear. Might be tempted though below 50 cents .. who knows, if the long term trend continues, maybe we get there before Christmas? :sleep:

[blobbles]

Well the seller does not seem to be that impressed by the announcement. If it is still AMP then there is potentially another 37 mill to sell boys!
If it is AMP then I stick with my supposition that the sales are driven by mandate not logic. How much more good news can there be? Chinese distribution networks increasing, sales up in Aussie, product diversification, dual listing, scientific evidence on the rise, revenue multiple to market cap falling, expanding o/seas markets etc.

Are you actually counting? It just seems that everyone keeps saying 37m when there are days and days of trading millions of shares...

[blobbles]

Well, I guess a buyer has typically a different perspective than a holder and / or a seller ...

Looking at the stock - yes some of the promises don't look too bad. However - if I look at the forward PE (60), than the share appears to be currently even at 30+ percent growth rate quite dear. Might be tempted though below 50 cents .. who knows, if the long term trend continues, maybe we get there before Christmas? :sleep:

Correct me if I am wrong, but is P/E a good measure with ATM who are using all the E side of the equation to grow sales (and doing so successfully)? Their just reported earnings were 10k, they used all their dosh to jump into other markets, 3m in the UK alone for instance.

I wonder if they just stuck to Aus, what would their real profit be?

[Harrie]

Are you actually counting? It just seems that everyone keeps saying 37m when there are days and days of trading millions of shares...

Just using the updated numbers NT's broker provided blobbles. 37mil, 30mil, 25mil, 20mil...it doesn't really matter, its still an awful number of shares which would seriously affect SP for some time if they were dripped into the market.
I do agree with you response to P/E though based on the june 30th earnings. P/E for this company is virtually irrelevant as it is for most growth companies.
Even to do a DCF under a EBITDA multiple method or perpetuity growth method is difficult. Assumptions around earnings growth factors, terminal value etc are pretty loose.

[klid]

without a doubt trading numbers indicate a large seller is selling still.
I was happy to add to my holdings today despite the obvious sell down..... long term very promising so had to make the most of a depressed share price

Yeah me too :) agree.

[Chaowee88]

In 1919 Coke cola was first listed on the NYSE valuing the company at $40m.
After many stock splits(10 to be exact) and despite being in a highly competitive market for the last 20 years the company is now worth $194b ( this does not include all the divies)

Oh god comparisons being made to Coca cola....

[klid]

Speaking of CCL I think they're a BUY right now :) CCL.ASX
Milk and coke.
Maybe they could merge and make cokemilk.