$69 postpage LB

Bellamy’s Australia Ltd.’s Shares Tumble As The Company Expects The Sales of 1H19 To Go Down By $10- $15m

  • October 24, 2018 02:12 AM AEDT
  • Team Kalkine
Bellamy’s Australia Ltd.’s Shares Tumble As The Company Expects The Sales of 1H19 To Go Down By $10- $15m

On 24 October 2018, Bellamy’s Australia Limited (ASX: BAL) held its Annual General meeting, in which the company informed its shareholders and investors that the company is expecting the sales of first half of FY 2019 to go down by approximately $10- $15 million. Following this news, the share price of the company dropped by 7.89 percent as on 24 October 2018.

Gold MTF non-AMP

In FY 2018, the company reported strong revenue growth, profitability and cashflow. The sales of the company increased by 37 percent to $329 million as compared to the sales figures of FY 2017. The EBITDA of the company increased by 65 percent to $71 million in FY 2018 on a normalized based as compared to the previous corresponding period. The company was having a strong balance sheet at the end of FY 2018 with $88 million in cash and no debt.Â

In FY 2018, the company made changes to the underlying business model and increased its focus on the driving productivity and reinvesting gains in the brand, organizational capability and supply-chain. As per the company’s CEO Mr. Andrew Cohen, the company has transformed its business in terms of culture and capability. He further added, the company is also focusing on a detailed three-year growth strategy which will recognize the important opportunities for organic infant nutrition in China and Asia and the company is targeting more than $500 million in revenue by the year 2021.

Company is expecting that the FY 2019 trading environment will be more challenging as the company is witnessing slow China cross border growth, and increased competition in terms of both availability and trading pricing for both local and global competitors. In FY 2019, the company is taking a very important initiative of brand and product upgrade which aims to transform both the competitive position and addressable market. This initiative will allow the company to compete head to head with both scientific brands and other leading organic brands. The Company needs to set the right conditions to make this initiative successful, which is why the company is planning to run-down distributor trade inventory prior to launch in 2H19. It is expected that it will impact the sales in the first half of FY 2019, by reducing it to around $10 to $15 million.

The company is also Planning to include fresh local Australian milk and extending the formula range to include Step 4 and Pregnancy formulations. The company has already launched the new premium branding for Food, expanded food ranging to include Woolworths, and launched an enhanced cereal range fortified with GOS prebiotic, a sugar-free custards range and a new exotic fruit pouch range aligned to Chinese preferences.

In the past three months the share price of the company decreased by 26.30 percent as on 23 October 2018, and it traded at a PE level of 21.660x. BAL’s shares traded at $7.82 with a market capitalization of circa $962.5 million as on 24 October 2018 (AEST 12:55 PM).


The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkinemedia.com and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.



The website https://kalkinemedia.com/au is a service of Kalkine Media Pty. Ltd. (Kalkine Media) A.C.N. 629 651 672. The principal purpose of the content on this website is to provide factual information only and does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stock of the company (or companies) or engage in any investment activity under discussion. We are neither licensed nor qualified to provide investment advice through this platform. In providing you with the content on this website, we have not considered your objectives, financial situation or needs. You should make your own enquiries and obtain your own independent advice prior to making any financial decisions.
Some of the images that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed on this website unless stated otherwise. The images that may be used on this website are taken from various sources on the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image. The information provided on the website is in good faith, however Kalkine Media does not make any representation or warranty regarding the content, accuracy, or use of the content on the website.


We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK