A2 Milk has answered his criticism which is the most important – the bottom line.
Shares, which have polarized opinion in the investment community, have come under fire from various corners of top-selling shares, concerns about regulations in China, and ongoing skepticism about the validity of claims around beta-free milk beta – this time from the US milk sector.
The company says beta-free beta protein milk can be useful for people who have difficulty digesting standard milk, which contains a1 and a2 beta proteins.
In the updated earnings released at the annual meeting in Melbourne, A2 Milk said its net profit jumped 64.5 percent to $ 86 million in the first four months of its financial year, compared with the same period last year – a record.
Revenues for four months reached $ 368.4 million, up 40.5 percent compared to the same period last year, which was at the top of market expectations.
The company posted after-tax net profit of $ 195.7 million in June, up 116 percent over the previous year.
Chief executive Jayne Hrdlicka said he was not worried about an offer by the US National Milk Producers Federation to get Milk a2 to paddle back to US advertising claims.
The senior federation executive and attorney Clay Detlefsen have asked A2 Milk to "defend and prove" its advertising and marketing claims, and to participate in an official process initiated by the federation's complaint.
Hrdlicka said he believed Milk would be successful in the US, where he had raised the distribution point by 50 percent in the first four months.
"We know that we are raving about the big US dairy farmers because we basically rocked the category and we know that we are taking market share in all segments of milk consumption," he said.
"In our hearts, we are bullies. This company has taken a lot of time to get a strong position today and that because we are bound to do the right thing by consumers."
Shane Solly, portfolio manager at Harbor Asset Management – which has a stake in A2 Milk – said the company had made a breakthrough in the US, repeating a pattern that began with a major attack on Australia's fresh milk market where it now has 10 percent market and 33 percent of the formula market baby there.
"While the US dairy industry may not be seen as very innovative, retailers are," Solly said. "But they have a long time to go."
Investors were still worried from sales by Hrdlicka of around $ 4.3 million in shares in one share Milk was given to him as part of its package in September after only two months in work, which triggered a sharp decline in its share price.
Australian media reports A2 Milk chief David Hearn said the company's annual meeting could better communicate to the transitional regulation market – aimed at compensating Hrdlicka for leaving the previous employer, Qantas.
"With the benefits from behind, we can certainly do things that might be different," Hearn said.
A2 Milk lacks prospects for the full year, in addition to saying that it expects strong revenue growth to continue but at a slightly more moderate level than in the first four months.
Hrdlicka said the company had a well-managed "daigou" trade network in China and had anticipated changes to the rules governing trade – announced in August – for some time.
Momentum in Chinese baby formula – which now has a 5.6 percent market share – continues to build up for a2 Milk.
"As we have said on several occasions, the A2 Milk Company and our well-managed Daigou network have been anticipating and preparing for this change for some time," he said.
A2 Milk stock prices have been riding roller coasters since listing in 2004.
This time last year, shares traded at $ 7.84 before almost doubling to $ 14.10 in March.
Last traded at $ 10.30, down 17c, far from its peak for the day of 11.11, while the market as a whole was sharply lower.