A2 Corp halves annual loss, expects further improvement
A2 Corporation has halved its losses in its 2008/09 financial year, the company’s preliminary results reveal.
The company, which owns and licenses technology to identify milk with the A2 beta casein protein it claims has health benefits, has announced a post-tax loss of $3.5 million or $2.7 million excluding abnormal costs for the 15 month period to June 30, 2009.
Last year the company reported a $6.3 million loss over the 12 months to March 31, 2008. Since then the A2 Corporation has changed to a mid-year reporting period.
In its report to NZX, A2 Corporation claimed financial improvements came from a two-pronged approach.
The first was the strengthening of its balance sheet with share placements to create a net cash position of $8.9 million, which was $7.1 million at the close of the financial year.
As a result the company expected to require no further capital unless an acquisition or purchase of assets was considered.
Secondly, improved operational performance was delivered from a restructure of the management team and a focus on procedures and accountability that saw previous losses reduced dramatically.
A deliberate strategy of making key markets profitable was also followed.
Its joint venture, Australian Dairy Products Australia (A2DPA) has traded profitably since December, except for April, due to a one-off cost, and finished the year with a $A500,000 ebit, compared with a loss of $A3.4 million last year.
The company signalled it expected the trend to continue with improvements on milk volume and profitability into 2010.