Specialty dairy company A2 Milk has posted a record profit, driven by booming sales of infant formula because of the COVID-19 virus.
The company reported an annual profit of $385.8 million compared with $287.7m last year, as revenue rose by a third and it held margins at target levels, which it had signalled to the market in April.
"We estimate that COVID-19 had a modest positive impact on revenue and earnings for the year. Additionally, our business was favourably impacted by foreign exchange movements," the company said in a statement.
A2 Milk makes dairy products from milk without the A-1 protein, which is held to be easier to digest and absorb for some people.
Its full year revenue was $1.73bn, with infant formula sales making up more than 80 percent of that, while operating earnings rose 33 percent $549.7m.
Sales grew strongly across all key regions, as households stocked up with its products, notably in China and Australia, while it continued to make inroads in the United States where sales grew more than 90 percent where it has been pushing fresh milk and other consumer products.
A2 Milk's marketing spend hit a record $194m, up 45 percent on the previous year.
Chief executive of Australia and New Zealand Peter Nathan said the company would continue to raise its marketing spend which emphasised the A2 Milk brand given its coverage was not confined to any one product.
"The brand difference is what makes us so compelling and that is why we invest so heavily in our brand."
He said A2-Milk was seeing increased competition in infant formula and fresh milk sales in China but so far its market position and leadership was not being challenged.
Nathan said the company was looking at broadening its sources of milk and powder supplies.
Most of its formula is made by Synlait Milk, which it owns about 17 percent of the company.
The company has never paid a dividend and did not give any earnings forecasts, but Nathan said with cash in hand of $854m investment in new facilities or buying suitable assets was possible.
A2 Milk is the second most valuable company on the stock exchange with a value of about $15.4bn. Its shareprice can be volatile and is often knocked around by developments involving China - its major market.
So far this year the stock has risen 38 percent.