Highlights

• Group Revenue grew 12.4% to NZ$1,974.9 million, with all markets and categories delivering growth.

• EBITDA was NZ$284.4 million with underlying EBITDA up 5.4%; NPAT rose to NZ$207.5 million.

• A NZ$300 million Special Dividend was declared alongside an increase in full-year Ordinary Dividends to 21.0 cps.

• A 4Q26 Supply chain disruption in China label IMF has been resolved, with FY27 outlook of mid-single-digit revenue growth and ~15% EBITDA margin.

The a2 Milk Company (ASX:A2M, NZX:ATM) is a New Zealand-based consumer goods company commercialising the A1 protein-free a2 Milk™ and a2 Platinum™ brands across infant milk formula (IMF), liquid milk, and nutritional products. The company operates primarily in China and Other Asia, Australia and New Zealand, and the USA. It sources milk from cows that naturally produce only A2 beta-casein protein, which the company argues is more easily digested.

Recent Development

On 17 August 2026, a2 Milk reported FY26 group revenue of NZ$1,974.9 million (up 12.4%), with growth across all geographic segments: China and Other Asia up 11.2%, ANZ up 10.2%, and USA up 28.6%. EBITDA was NZ$284.4 million with underlying EBITDA up 5.4%, and NPAT was NZ$207.5 million (up 7.0%). Basic EPS was 28.6 cents with underlying EPS of 32.5 cents (up 6.8%).

The company's infant formula (IMF) Business grew 5% in a flat China market. Other Nutritionals grew 42% through innovation in kids, seniors, UHT, and supplement products. Liquid Milk delivered 22% growth through Market Share gains in ANZ and the USA. A 4Q26 supply chain disruption — temporary product availability shortfall in China label IMF resulting from strong demand, air and sea freight constraints, and Synlait production Backlog — has been resolved with recovery underway. The company declared a NZ$300 million special dividend and increased full-year ordinary dividends to 21.0 cps, with a closing cash balance of NZ$784.5 million.

Sector Context

The China infant formula market remains fiercely competitive following the surge in domestic Brand share post-2023 regulatory changes. a2 Milk's English label IMF — particularly a2 Platinum™ — continues to outperform in cross-border E-commerce channels. The Acquisition of a2 Pōkeno earlier in FY26 is a strategic move to bring New Zealand Manufacturing capability in-house, reducing reliance on Synlait and improving supply chain resilience. The strength of the a2™ brand across multiple nutritional categories is reducing the company's historical dependence on China label IMF.

Risks and Uncertainties

The 4Q26 supply chain disruption, while characterised as temporary, highlights the fragility of a concentrated China label IMF supply chain. a2 Pōkeno transition costs generated an EBITDA loss of NZ$23.2 million in FY26, and the transition to low production volumes ahead of the a2 Platinum™ relaunch will continue to weigh on FY27 results. The China IMF market remains subject to competitive and regulatory dynamics that are difficult to predict. Currency movements (NZD/AUD and NZD/USD) create translational headwinds for ASX investors given all figures are reported in NZD.

Catalysts to Watch

The planned launches of two new China label IMF products in 1H27 (under the a2 Pōkeno platform) are key commercial catalysts. A recovery in China label IMF volumes following the 4Q26 disruption, and the scaling of the Other Nutritionals segment beyond its 42% FY26 growth rate, are the primary Earnings drivers to monitor. Progress on USA growth — up 28.6% in FY26 — and the expansion of Liquid Milk market share in ANZ are secondary but important Diversification catalysts.

Final Thoughts

a2 Milk (ASX:A2M) delivered a genuinely strong FY26 across all markets and categories, reflecting the power of the a2™ brand and expanding product portfolio. The supply chain disruption was disruptive but appears resolved, and the $300 million special dividend signals management's confidence in the business and Balance Sheet strength heading into FY27.