Synlait Milk, whose shares are up 81 per cent from its initial public offering, lowered its full-year profit forecast, saying regulatory changes in China and Fonterra Cooperative Group's whey protein recall are denting volumes of infant formula and nutritional products.
Full-year profit will be in a range of $25 million to $30 million, down from the $30 million-to-$35 million estimate it gave in January. The projection is still well ahead of its prospectus forecast of $19.8 million.
The Rakaia-based company lowered its guidance while announcing a 79 per cent jump in first-half profit to $12.1 million as sales rose 62 per cent to $284.9 million. Its profit margin rose to $919 per metric tonne in the six months ended Jan. 31 from $751 in full-year 2013.
"Despite it being clear that we will not meet our infant formula and nutritional volume targets for this financial year, we remain confident of meeting our long-term objectives," managing director John Penno said in a statement.
"With a favourable product mix and an increasing amount of product sold into value-added applications we expect our milk powder and cream products business to outperform our initial public offer projections in FY2014," he said.
