Beingmate lowers outlook on formula fraud scandal
Beingmate expects losses after fraud scandal
Chinese infant formula maker Beingmate Baby & Child Food Co. has lowered its outlook for profits for the first half of this year, warning of the impact fraudulent infant formula sales has had on its brands.
The company revealed it now anticipates to report a net loss for the January-to-June period of between CNY210m (US$31.5m) and CNY230m. Beingmate had previously forecast net profit for the six months of CNY70-100m.
The company primarily attributed the loss to the fact "fake" milk powder was introduced to the Chinese market under its brand name during the period.
In April this year China's food safety regulator – China Food and Drug Administration (CFDA) – confirmed traders had brought more than 17,000 tins of fake infant formula to market under brands owned by Beingmate as well as US-based Abbott Labratories. At the time, a spokesperson for the food safety regulator said that the "criminals" had purchased "cheap milk powder" and repackaged it under the Abbott and Beingmate brands.
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