The a2 Milk Company (a2MC) has upgraded its FY26 outlook after delivering stronger first-half growth across infant milk formula (IMF), liquid milk and nutritionals, with revenue from continuing operations up 18.8 per cent to $993.5 million for the six months to 31 December 2025.
Snapshot
- Group EBITDA: up 18.4% to $155m;
- EBITDA margin: steady at 15.6%;
- NPAT: up 9.4% to $112.1m;
- Underlying NPAT (excluding losses and one-off transformation costs associated with the a2 Pokeno acquisition): up 19.6% to $122.6m; and
- Interim dividend: 11.5 cents per share, an approximate 74% payout.
Managing director and CEO, David Bortolussi, said the first-half result reflected improved execution across key channels, with the company continuing to prioritise brand investment and supply chain resilience.
Following the first-half performance, a2 Milk lifted FY26 guidance for continuing operations, now expecting mid double-digit revenue growth versus FY25 continuing operations, with an EBITDA margin approximately 15.5-16 per cent. It expects cash conversion around 80 per cent and capex of approximately $60-$80 million.
The company also reaffirmed plans for a $300 million special dividend, subject to regulatory approvals linked to amendments to two existing China label registrations for use under the a2 Milk Company brand.
China & Other Asia: formula momentum and fast-growing nutritionals
China & Other Asia remained the key growth engine, with segment revenue up 20.3 per cent to $739 million and EBITDA up 13.2 per cent to $167.6 million.
In China label IMF, sales increased 6.5 per cent to $324.9 million, supported by the category returning to growth and favourable foreign exchange. a2 Milk said it remains a top four brand in the total China IMF market, with overall market share of 8.2 per cent (up 0.2ppt on FY25), and China label share of around 5.6 per cent.
English label IMF sales in China & Other Asia increased 23.9 per cent to $320.2 million, driven by growth in CBEC and O2O channels and ongoing premiumisation. The company highlighted continued momentum in a2 Genesis, its premium English label IMF.
“Other Nutritionals” revenue in the region grew 84.5 per cent, driven by kids and seniors fortified milk powder innovation, with a2 Milk flagging further product expansion into paediatric supplements and kids fortified UHT in the second half.
ANZ: liquid milk gains continue
In Australia and New Zealand, revenue increased 8.6 per cent to $171.3 million and EBITDA rose 12.6 per cent to $33.2 million.
Australian liquid milk sales grew 11.9 per cent to $116.1 million, led by the core a2 Milk range and a2 Milk Lactose Free. The company said it lifted liquid milk value share to 11.5 per cent (+0.3ppt), while the lactose-free line reached a record 20.6 per cent MAT value share.
Daigou channel sales were relatively flat, with a2 Gentle Gold supporting retail channel growth.
US growth continues as losses narrow
US revenue rose 29 per cent to $83.2 million, supported by core and grassfed liquid milk growth and broader distribution in Grocery, Mass and Club. EBITDA loss improved to $3.4 million (from $4.9 million).
Supply chain: Pokeno completed, inventories rebuilding
a2 Milk completed its acquisition of the a2 Pokeno nutritional manufacturing facility, with the purchase price reduced to around $275 million following a completion adjustment in its favour, and divested Mataura Valley Milk (MVM) as it reshaped its manufacturing footprint.
The group ended the half with net cash (cash and term deposits) of $896.9 million. Inventory increased as a2 Milk rebuilt IMF stock following Synlait manufacturing challenges late in FY25, with the company reporting inventory levels had partially recovered by December but remained below target.
