HONG KONG -- Shares in dairy producer China Mengniu Dairy rallied up to 7.72% to a two-year high on Thursday, following better-than-expected first-half results.
Mengniu Dairy's net profits in the six months to June rose 5% on the year to 1,127 million yuan ($171 million), supported by stabilizing milk prices and effective control over costs. This marginally exceeded the analysts' consensus of 1,125 million yuan compiled by QUICK FactSet.
Revenue rose 8% on the year to 29.4 billion during the same period, according to results released on Wednesday after the market closed. Revenue in the liquid milk products sector -- which accounts for almost 90% of revenue -- saw a 7% expansion, supported by strong sales in milk beverages and yogurt. Ice cream sales rose 17% on the year during the same period.
Following the announcement, Hong Kong-listed shares of Mengniu Dairy rose as much as 7.72% on Thursday morning to 18.68 Hong Kong dollars, the highest level since July 28, 2015. The shares later eased back to close 5.42% higher at HK$18.28.
The first half was less positive for Mengniu Dairy's affiliate companies. Its subsidiary Yashili International Holdings, a powdered milk producer, reported net losses of 121 million yuan. China Modern Dairy Holdings also widened its net losses to 666 million yuan from 565 million in losses last year.
Nikkei staff writer MarikoTai in Hong Kong contributed to this report.