ATM - A2 Milk Corporation Limited

[Harrie]

They're a smart bunch the A2 team, aren't they? Making sure the supply is slowly but certainly beefed up to meet ever increasing demand. With SML in south island and this new facility in north island, they're making sure the logistics side is also addressed long with supply.

They had cash on hand of about $69m as at time of FY results time, pretty sure some it being pumped into further capacity investments either directly or indirectly.

I'm not sure that a2mc will be making any investment into capacity. Its not their business, as it is not with Synlait. The manufacturers will make their own decisions and invest their own capital to increase capacity based on demand. a2's $69 mio will be spent on increasing sales in their target market. That's my understanding anyway but happy to be corrected on that.

[NT001]

I'm not sure that a2mc will be making any investment into capacity. Its not their business, as it is not with Synlait. The manufacturers will make their own decisions and invest their own capital to increase capacity based on demand. a2's $69 mio will be spent on increasing sales in their target market. That's my understanding anyway but happy to be corrected on that.

Fully agreed Harrie. It's not at all clear where the planned Otorohanga plant might fit into ATM's operations. There seems to be no corporate or shareholder link, nor any hint that the owners/operators have even had contact with ATM. The new group merely say the plant will have A2 capability as well as organic, which doesn't mean much. And they won't be in operation until well into 2018, by which time the dairy scene in the North Island will have further evolved. In my view, ATM needs to be well along the planning road now for starting up NI operations next year.

You're absolutely right that investing capital in new production facilities is not in line with ATM's deeply ingrained modus operandi. There will be other uses for the $69m cash on hand.

[sb9]

"A2 Milk could become a takeover target again: fund manager"

Headline of article from NBR behind pay wall, could someone summarise key points...(I know its illegal post entire article), thx.

[Leftfield]

"A2 Milk could become a takeover target again: fund manager"

Headline of article from NBR behind pay wall, could someone summarise key points...(I know its illegal post entire article), thx.

Speculation that because Harbour Asset Management and Greenscape capital have both increased their ATM holdings since the last results announcement, that ATM is 'undervalued' and 'should feel vulnerable.'
However, it is noted that some ATM execs and Dirs have been selling down small portions of their stakes, e.g. Babidge who recently sold 1 mill shares.
So very much speculation at this stage. Could just be the fund managers pumping. Time will tell.
IMHO any SP decline below 1.90 represents a buying opportunity (disc holding and not recommending.)

[sb9]

Speculation that because Harbour Asset Management and Greenscape capital have both increased their ATM holdings since the last results announcement, that ATM is 'undervalued' and 'should feel vulnerable.'
However, it is noted that some ATM execs and Dirs have been selling down small portions of their stakes, e.g. Babidge who recently sold 1 mill shares.
So very much speculation at this stage. Could just be the fund managers pumping. Time will tell.
IMHO any SP decline below 1.90 represents a buying opportunity (disc holding and not recommending.)

Sweet, thanks for that Left field.

Well, this Friday on 16th the court case is back to hearing between Lion and A2, watch out how it unfolds...

[Leftfield]

Sweet, thanks for that Left field.

Well, this Friday on 16th the court case is back to hearing between Lion and A2, watch out how it unfolds...

Crikey that's quick..... I had thought such litigation would take years.

[sb9]

Crikey that's quick..... I had thought such litigation would take years.

Well proceedings start tomorrow, however might take few days/weeks before we know the verdict. And judge categorically said science isn't the issue behind A2 milk, just the tactics used by Lion promoting their pura milk brand vis a vis A2 milk brand.

[Leftfield]

Well proceedings start tomorrow, however might take few days/weeks before we know the verdict. .

Here's an update.....http://www.smh.com.au/business/consu...16-gri2js.html

Looks like the substantive case will not be held until Nov 2017.

[Harrie]

Here's an update.....http://www.smh.com.au/business/consu...16-gri2js.html

Looks like the substantive case will not be held until Nov 2017.

Would a2mc succeed in slapping an injunction on Pura to stop it using the labelling a2mc is complaining about until the results of the hearing are known?
Seems to me that if a complaint is made where the public could be misled into believing a product is not wholly what its labelling is leading the public into thinking it is based on another brand, then the offending labelling should be removed until the court case has concluded.

[Sideshow Bob]

http://viewer.zmags.com/publication/...7#/2d605a27/32

A2 and China