US: Dean Foods ups FY profit forecast
- Adjusted earnings up 83%
- FY guidance raised
- Sales fall 8%
- CFO Mara to stand down at end of year
Dean Foods reported "strong" sales at WhiteWave-Alpro, which it floated last month
US dairy giant Dean Foods raised its full-year earnings outlook after booking better than expected third-quarter profits.
Dean Foods said third-quarter net income rose to US$36.4m, up from a loss of $1.5bn last year when the company booked a $1.9bn goodwill impairment charge. Adjusted earnings were up 83%, Dean Foods said. Profits were up across all its businesses.
Sales fell 8% to $3.14bn, despite a 13% increase in WhiteWave-Alpro revenues. The pass-through of lower commodity costs at Dean Foods' Fresh Dairy Direct and Morningstar units hit revenues.
Nevertheless, Dean Foods upped its full-year adjusted EPS outlook to $1.27-1.32, from a previous range of $1.18-1.28.
Dean Foods is undergoing a period of change. Last month, it spun off part of its WhiteWave business last month and it is also considering selling its Morningstar unit.
It confirmed the sale process for Morningstar is "ongoing" and insisted an announcement would be made if a deal is reached. If the company does proceed with the sale, it said the move would further deleverage the group and provide future financial flexibility.
The company, meanwhile, revealed CFO Shaun Mara will leave the company after the end of the year to "pursue other opportunities". General counsel Steve Kemps will also exit the company.
The latest management changes follow the departure last month of chief executive Gregg Engles, who left Dean Foods to head up WhiteWave. Gregg Tanner, former Fresh Dairy Direct chief, took the helm as Dean Foods CEO.
Chris Bellairs, currently fresh dairy CFO, will take over as group CFO.
Dean Foods Reports Strong Third Quarter Results
- Continued Strong Performance Across All Segments
- Q3 Diluted Earnings per Share of $0.20, Adjusted Diluted Earnings per Share increase 83% to $0.33
- Dean Foods Full Year 2012 Guidance Increased to $1.27-$1.32 per share
- Company announces Chief Financial Officer and General Counsel Succession Plans
DALLAS, Nov. 8, 2012 /PRNewswire/ -- Dean Foods Company (NYSE: DF) today announced strong third quarter results driven by continued solid growth across all operating segments. The Company reported third quarter 2012 diluted earnings per share of $0.20, compared to a third quarter 2011 loss per share of $8.39. The prior year third quarter includes a $1.9 billion goodwill impairment charge. On an adjusted basis, third quarter 2012 diluted earnings per share were $0.33, an 83 percent increase from the $0.18 adjusted diluted earnings per share in the prior year's third quarter.
Third quarter consolidated operating income for the third quarter of 2012 totaled $182 million, compared to a consolidated operating loss of $1.9 billion in the third quarter of 2011. Adjusted third quarter consolidated operating income for the third quarter of 2012 totaled $145 million, a 35 percent increase from the $108 million reported in the third quarter of 2011.
Gregg Engles, Chairman of Dean Foods said: "Today we announced our fifth consecutive quarter of growth, with all of our operating segments continuing to perform well. We have successfully built on the momentum from the first half of the year to deliver 35 percent growth in third quarter adjusted operating income and 83 percent growth in adjusted diluted earnings per share for the quarter. Our strong performance this year has created the flexibility to pursue important strategic actions like the recently completed initial public offering of The WhiteWave Foods Company. It has also driven our expectations for further growth to close out the year."
Net income attributable to Dean Foods totaled $36 million for the third quarter of 2012, compared to a net loss of $1.5 billion in the prior year third quarter. Adjusted net income for the third quarter was $61 million, an 84 percent increase from $33 million in the third quarter of 2011.
Net sales for the third quarter of 2012 totaled $3.1 billion, compared to $3.4 billion of net sales in the third quarter of 2011, reflecting strong sales growth at WhiteWave-Alpro offset by the pass-through of lower commodity costs at Fresh Dairy Direct and Morningstar.
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Original source: Dean Foods
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