Dec 18 (Reuters) – New Zealand's a2 Milk (ATM.NZ) on Friday slashed its first-half revenue forecast on a steeper-than-expected decline in informal Chinese demand due to disruption caused by the COVID-19 pandemic, sending its shares down 25%.
The Auckland-based company now expects revenue for the six-months through December to be NZ$670 million ($478.98 million), significantly below its previous forecast range of NZ$725 million and NZ$775 million, and last year's NZ$806.7 million.
The cut sent shares of the dairy producer to NZ$10.49, their lowest since January last year, marking their worst day since November 2008.
Sales through the so-called daigou channel, where shoppers in China buy products in bulk from stores outside the country and import them informally, account for a significant portion of the dairy firm's revenue.
However, virus restrictions in Australia's Victoria state in the second quarter pressured retail sales and dented its daigou network more than previously thought, a2 Milk said. Lower Chinese tourist and student arrivals is also likely to continue impacting recovery, it said.
The firm also cut its full-year revenue guidance range to NZ$1.40 billion to NZ$1.55 billion from its previous estimate of NZ$1.80 billion to NZ$1.90 billion.
($1 = 1.3988 New Zealand dollars)
Our Standards: The Thomson Reuters Trust Principles.
Some residents in Beijing face waiting days to cremate relatives or paying steep fees to secure timely services, funeral home workers said, indicating a growing death toll as the Chinese capital battles a sharp rise in COVID-19 cases.
Reuters, the news and media division of Thomson Reuters, is the world’s largest multimedia news provider, reaching billions of people worldwide every day. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers.
Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology.
The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs.
The industry leader for online information for tax, accounting and finance professionals.
Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile.
Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts.
Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks.
All quotes delayed a minimum of 15 minutes. See here for a complete list of exchanges and delays.
© 2022 Reuters. All rights reserved
