Synlait Milk Ltd. (SM1) AI Stock Analysis

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Synlait Milk Ltd.

(ASX:SM1)

Rating:―N/A

Action:N/A

Date:―

No summary available

Positive Factors

Manufacturing executionImproved in-spec production and plan attainment indicate stronger operational control, quality execution, and asset utilization. If sustained, these gains can support more reliable customer service, reduce disruption-related costs, and improve the durability of margins across Synlait’s processing operations.

Negative Factors

Negative cash generationHeavy operating and free-cash-flow losses show that Synlait is not currently funding itself through operations. Persistent cash burn can constrain investment, increase reliance on asset sales or external funding, and leave less flexibility to absorb further operating setbacks during the recovery period.

Synlait Milk Ltd. (SM1) vs. iShares MSCI Australia ETF (EWA)

Market Cap: AUD 244.30M
Dividend Yield: ―
Average Volume (3M): 51.34K
Price to Earnings (P/E): -4.3
Beta (1Y): 0.38
Revenue Growth: -13.95%
EPS Growth: -88.42%
Country: Australia
Employees: 549
Sector: Consumer Defensive
Sector Strength: 62
Industry: Packaged Foods

Synlait Milk Ltd. Business Overview & Revenue Model

Company Description

Synlait Milk Limited, alongside its associated entities, creates and markets a diverse portfolio of dairy products, serving international territories including China, the wider Asian region, the Middle East, Africa, Australia, and its home base of Ne...

Synlait Milk Ltd. Earnings Call Summary

Earnings Call Date:Sep 27, 2026(Q4-2026)|Next Earnings Date:Mar 29, 2027

Earnings Call SentimentPositive

The call presented a cautiously positive recovery narrative. Although FY '26 included substantial losses, negative operating cash flow, segment-level gross profit declines and a significant volume transition from a2 Milk, management emphasized strong second-half operational and financial improvement, lower debt, completion of the North Island sale, customer and market diversification, and confidence in covenant compliance and continued recovery.

Positive Updates

Second-Half Operational and Financial Recovery

Operations stabilized in the second half, with reported EBITDA improving by $77.5 million, underlying EBITDA improving by $38.1 million, reported net profit after tax improving by $85.8 million, and underlying net profit after tax improving by $33 million.

Negative Updates

Significant Full-Year Net Loss

FY '26 remained financially difficult. Synlait reported a net loss after tax of $75.4 million and an underlying net loss after tax of $21.6 million. The first half included an EBITDA loss of $34.7 million and a net loss after tax of $80.6 million.

Company Guidance

Synlait said it is not providing guidance for the 5 months ending 31st of December 2026, describing FY '26 as a 5-month transitional period; it expects milk supply to be 3% to 6% more than budget, expects a new Middle East customer to represent 18% of our FY '27 capacity, expects 3 years time to fully backfill capacity or demand, and said nutritional customer volumes normally take 2 to 3 years to get the peak volume. Management said it expects a big volume growth already in 2027, is confident it will continue the improvement in the second half, feels comfortable or confident it will meet bank covenant compliance, and will review its position on guidance at the end of this year and get back to the markets probably early February.

Synlait Milk Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

AU:SM1 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NZ:ATM	69Neutral	NZD 6.57B	28.48	17.63%	7.03%	3.84%	6.53%
NZ:CVT	68Neutral	NZD 101.94M	7.76	9.98%	―	10.67%	―
NZ:SAN	66Neutral	NZD 617.14M	8.99	9.48%	1.78%	-4.16%	91.88%
Sector *	62Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
NZ:NZK	54Neutral	NZD 131.85M	-14.20	-4.98%	―	―	―
NZ:MEE	40Underperform	NZD 7.17M	-2.19	―	―	-12.36%	79.80%

* Consumer Defensive Sector Average

Performance Comparison

AU:SM1 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
AU:SM1	Synlait Milk Ltd.	0.42	-0.18	-30.00%
NZ:ATM	a2 Milk Company Ltd.	8.87	-1.32	-12.98%
NZ:CVT	Comvita	0.79	0.20	35.11%
NZ:NZK	New Zealand King Salmon Investments Ltd.	0.25	0.05	25.00%
NZ:SAN	Sanford	6.84	0.73	11.89%
NZ:MEE	Me Today Limited	0.07	0.01	10.17%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Synlait Milk Ltd. AI Stock Analysis