Wednesday, 22 August 2018

Announcement

GENERAL: ATM: The a2 Milk Company expands US business to the North East

17 Jan 2018 08:30NZX
16 January 2018

NZX/ASX Market Release

The a2 Milk Company expands US business to the North East

The a2 Milk Company is pleased to announce the expansion of the a2 Milk(TM)
brand across the North East region of the United States from January 2018.

Since entry into the US market, the business has been focused on achieving
sales based targets prior to expanding its footprint on a region-by-region
basis. Sales velocities are now achieving sustainable levels in California,
the South East region and select natural retail chains, which supports the
expansion into an additional region.

The North East, home to roughly 60 million US consumers, is significant for
the refrigerated milk category and accounts for ~20% of the total milk
category volume in the US. The geography includes New York, New Jersey,
Pennsylvania, Connecticut, Rhode Island, New Hampshire, Massachusetts,
Vermont and Maine.

The a2 Milk(TM) brand has been accepted for ranging in a number of major
retailers in this region including Ahold, Shoprite, Safeway, H-Mart and
Fairway Foods. This distribution builds on a growing presence in the natural
channel in this region through Wholefoods, Sprouts and The Fresh Market.

As a result of this initiative, a2 Milk(TM) will increase it''s ranging from
~3,600 stores to potentially ~5,000 retail stores across the US from January.

The expansion in distribution will be supported by increased marketing
investment behind the "Love Milk Again" advertising campaign.  This increase
is incorporated in the forecasted higher marketing expense for the Group in
2H18 relative to 1H18, as advised at the Company''s Annual Meeting on 21
November 2017.

The Company is also investigating specific new product opportunities for the
US market to further capitalise on the growing brand awareness and expanded
distribution.

For further information contact:

The a2 Milk Company Limited
Geoffrey Babidge
Managing Director and CEO
+61 2 9697 7000
End CA:00313102 For:ATM    Type:GENERAL    Time:2018-01-17 08:30:27
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