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Bellamy's lifts full-year core guidance

Prashant Mehra  |  12 Oct 2017Text size  Decrease  Increase  |  
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SYDNEY - [AAP] Bellamy's (ASX: BAL) has upgraded full-year guidance for its core infant formula business, but expects its recently acquired Camperdown cannery to remain a drag on its finances.

The Tasmania-based firm has flagged revenue growth excluding Camperdown of 15 to 20 per cent, up from its previous forecast of 5 to 10 per cent.

Citing a positive start to the financial year, Bellamy's also raised the bottom end of its earnings guidance range, with growth now expected to be 17 to 20 per cent, compared to its August estimate of 15 to 20 per cent.

Bellamy's shares surged 25 per cent over three trading sessions ahead of Thursday's announcement, ending Wednesday at $9.78 for their highest close since December 2016.

The company on Thursday reiterated its previous advice that second-half revenue would be lower than that in the first half because sales of Chinese-labelled Bellamy's products would cease due to delays in obtaining China Food and Drug Administration (CFDA) registration.

"While Bellamy's sees positive momentum in its core business, there are still challenges to navigate, including CFDA registration, as it implements its turnaround plan," the company said.

The Camperdown cannery it acquired in June is still forecast to generate an earnings loss of between $1 million and $2 million.

It will also be subject to ongoing class actions and amortisation of intangible assets arising from the acquisition, the company said.

 

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