Bellamy's Dives as Infant-Formula Maker Hits China RoadblockBy
Company says it will miss 2018 deadline to register products
Australian firm has slumped about 23 percent year-to-date
Bellamy’s Australia Ltd. tumbled the most since January after saying it will miss a deadline to register its products for sale in China, further clouding prospects for the infant-formula maker.
The company, which gets about 14 percent of its total sales in China, said it wouldn’t get the required registration from the China Food and Drug Administration by Jan. 1, 2018. Testing at a new canning line would take as much as six months, Bellamy’s said in a filing Thursday.
The Launceston, Tasmania-based company’s shares fell 8.3 percent in Sydney, the biggest drop since Jan. 13. Its shares have plunged 23 percent this year.
The registration delay is another setback as Bellamy’s struggles to provide clarity on its growth prospects, after forecasting waning profits on unsold stockpiles of infant formula. Chairman Rob Woolley resigned and most of the board were replaced by nominees from rebel shareholder Black Prince Private Foundation last month.
“They have always had a grey channel issue into China,” Evan Lucas, a market strategist at IG Ltd., said by phone from Melbourne. “The whole last seven months have been an absolute disaster.”
Bellamy’s said its China products accounted for A$16 million ($12 million) worth of sales in the first half of 2017, or 14 percent of the total. The company is “actively pursuing strategies to mitigate the extent of any interruptions to the supply” of its products to China, according to the statement.