What’s new?FY15(YE:March)core net profit was down 29% yoy to RMB906m,which was at the high-end of its profit warning issued on 12 June 2015.Total revenue was up 11% yoy to RMB3,923m,which was mainly driven by the liquid milk and milk powder businesses.The group’s gross margin was down 4.8ppt yoy to 57.6%,mainly due to operational deleverage as a result of falling raw milk prices.Despite the decline in gross margin,the EBIT margin was down 10.6ppt yoy to 32.9% and net margin also dropped by 13ppt yoy to 23.1% on the back of higher A&P,admin,and finance expenses.As at end- March 2015,the company had net debt of RMB4.9bn and net gearing of 36%.The company recommended a final DPS of RMB1.53cents,representing a payout of 24% on reported earnings(FY14:24%).