I understand the consumer does not trust dairy from China. I wonder why?
LOS ANGELES — Shares of American Dairy Inc., a Beijing-based company that distributes infant formula in China, slipped more than 23 percent on Monday after the company swung to a second quarter loss and said it expects third-quarter revenue to miss estimates.
Shares set a new 52-week low of $9.66 earlier in the day. By late afternoon, shares fell $2.99, or 23 percent, to $9.89 on heavy volume.
The company's loss attributable to ordinary shareholders was $20.6 million, or 92 cents per share, in the three-month period ended June 30. That compares with earnings of $7.6 million, or 40 cents per share, a year ago.
Analysts expected earnings of 18 cents per share on revenue of $60.8 million, according to Thomson.
Sales rose 27 percent to $52.2 million from $41.2 million, with the expansions of the company's distribution network in China.
Sales of branded milk powder products, which consist mostly of higher margin infant formula products, were approximately $35 million, up 9 percent from a year earlier.
The company projects its revenue will exceed $55 million in the third quarter. Analysts expect revenue of $72.4 million in the quarter, according to Thomson.