Infant nutrition firm Ausnutria eyes record profits on back of sales boom

By Gary Scattergood contact

- Last updated on GMT

Ausnutria is predicting record profits after 'sustained sales growth'. ©iStock
Ausnutria is predicting record profits after 'sustained sales growth'. ©iStock

Related tags: Milk

Hong Kong-listed infant nutrition company Ausnutria Dairy Corporation is forecasting record profits of around RMB135m (USD $19.8m).

On a like-for-like comparison on the nine months to the end of September, this represents a near-200% increase on last year.

The company said the strong numbers were driven continuous sales increases.

“Sales of the Group for the third quarter of 2016 is anticipated to increase by 28.8% (approximately RMB1,893.2m), among which, the group's own-branded cow and goat milk-based infant formula products in China are anticipated to increase by 65.4% and 29.6%, to approximately RMB667.4m and RMB461.2m, respectively when compared with the same period of last year,”​ said the firm.

It also said an upgrade of its processing and facilitie in the Netherlands had boosted its fortunes in Europe.

Ausnutria chairman Yan Weibin said the company’s performance meant it was in a strong position to benefit from more stringent infant nutrition policies in China.

"We are encouraged by the performance in the first three quarters of 2016, and Ausnutria is ready to meet the important opportunities and industry challenges brought by national policies,”​ he said.

“The Group will continue to increase production capacity, and work on the integration of the upstream industry chain, achieve the diversification of downstream products, enhance the development of our own-brand business, and enter the nutrition industry, to become a global leading formula and nutritional food supplier, nutrition and health consultants and service provider.”

International health

Last month we reported the company had purchased a 75% stake in Australian supplement manufacturer Nutrition Care Pharmaceuticals in a US$23.8m deal.

Nutrition Care will retain a 25 per cent stake in the business and will oversee the company's research and training operations globally.

The cash injection will be used to ramp up its activities in China, especially through e-commerce channels.

The company said the deal marked its entry into the booming international health care product market.

"Ausnutria has been committed to improving public nutrition and health standard by providing high quality dairy products and strong foundation. The Group has realised the business potential and importance of the nutrition products years before.

"Given the increasing health awareness globally and in particular [China] where the living standard has been improving, the nutrition products segment has a great potential of high future growth,​" it said in a statement to shareholders.

Weibin added In September the company had signed an agreement to set up a joint venture with New Zealand's second largest dairy co-operative, Westland, to build a new milk powder mixing and packaging production plant at Rolleston in New Zealand.

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