260% Increase In Australian Sales

260% Increase In Australian Sales And Successful Capital Raising Are The Highlights For A2 Corporation

Auckland, 28 December 2008 - A2 Corporation Limited (“A2C”) (NZAX:ATM) today announced a Group post-tax consolidated loss for the six months to 30 September 2008 of $1,993,000 compared to a loss of $2,073,000 in the same period ending 30 September 2007. Further details of the results are contained below.

A2C Chairman, Cliff Cook, stated “We are very pleased with the way the business has progressed over the period. Most pleasing is our Australian business where sales in the six months ending September 2008 increased to A$7.8 million, up from A$3.0 million in the same period last year. This outstanding result is a 260% increase and has seen a2 Milk™ become one of the high achievers of the Australian dairy category. This is clearly a reflection of the success of our joint venture with Freedom Nutritional Products in Australia.”

Cook also added, “In the last few months, the Australian business has become self-sufficient from a cash flow perspective. Any new capital provided to Australia will be used to grow this market.”

The recent successful capital raising has allowed the Company to retire outstanding debt but more importantly has provided sufficient remaining cash on hand of $8.9 million (as of 30 September) to support the completion of a business plan which will move the Company into profitability.

August 2008 saw a2 Milk™ launched in South Korea via A2C’s exclusive licensee, Lotte Milk. The product has only been on the market for three months, but to date the retailers’ acceptance is pleasing with plans to introduce other value-added a2 MilkTM products such as yoghurt to the Korean market, before expanding to other parts of Asia.

ENDS

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