Over the past five years the industry’s performance has been driven by strong demand for organic products and nutrient added. The operators have understood the rising demand for these products in both global and domestic market. However, the market competition has intensified with the private-label sales via ALDI and Woolworths. Here are three stocks discussed under this category.
Bellamy’s Australia Limited (ASX: BAL) – The company reported 37% increase in sales and hence a 65% growth in normalized EBITDA, for the period ended 30 June 2018 which was recently announced by the company. Despite tough market conditions, the company reached $42.8 million of net profit after tax, compared to $0.8 million net loss reported last year. Bellamy’s efforts to maintain strong growth continues with segment EBITDA increasing up to $78.12 million. The company has also made $39 million in FY 2018 supply-chain investments and has $88 million cash in hand with no debt. The stock has soared higher, up 12.5 percent, to $9.180 as at October 17, 2018. Since inception the stock has seen a tremendous performance change of 538.31%.
Blackmores Limited (ASX: BKL) – The net sales recorded a growth of 9% to $601 million in FY18 compared to prior corresponding period. On the back of strong topline growth, net profit after tax (NPAT) grew by 19% to $70 million in FY18 compared to prior corresponding period is up 8.2 percent. The final dividend of 155c were declared recently which are fully franked. The company also had an improved gross margin, strong financial health and balance sheet maintained, with cash generated from operations of $90m. With a 20% gearing ratio the net debt position of the Group remains low consistent with the prior year. The stock has gone up 8.788 percent, to $127.630. Since inception the stock has seen a tremendous performance change of 588.36%.
A2 Milk Company Limited (ASX: A2M) – The a2 milk company had a revenue change of 68% as compared to the prior corresponding period at $923 million, resulting to which the company also posted EBITDA of $283 million which is up by 101% on prior year. Because of efficient working capital and strong NPAT contribution the cash on hand increased from $121.0 million to $340.5 million up on prior year. The FY18 earning per share (EPS) increased from 113% to $27 cents. The company had a strong cash conversion which is 131% up on the prior corresponding period, to an operating cashflow of $231.1 million. For future the company expects the EBITDA to sales ratio broadly consistent with FY18. The stock is up 8.361 percent to $9.785, Since inception the stock has seen a tremendous performance change of 1498.23%.
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