It is easy to get interested again, in A2M, as it trades towards $4.

You can see the hope flicker from an improved revenue trajectory, both in the results below and in the management commentary about the outlook…


…but it all flops over a bit when you read, but a bullet point later, that it isn’t expected to translate into higher earnings, as additional investment/marketing/promotional/distributional spend are expected to eat it all…


Flogging milk (and formula) is competitive, unsurprisingly, and being 10% share anywhere is hard to do, hard to maintain, without spending a lot of money.


They’ve got the balance sheet to keep it up, for a while at least, but it has the feel of a Pointsbet (PBH) or similar, in keeping the eyes and interest of consumers and their preferences.

At the least, in Aus, the demographic story isn’t so bad…


…but it hard to imagine a worse revenue backdrop for selling infant formula than the below. Shrinking pies make for fiercely competitive dynamics.


Mind you, how the above story fits with the US issues of no availability of supply re: the infant formula market is likewise difficult to square.

Still, not one for us, just yet.

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