Dean Foods has booked a leap in first-quarter net earnings, boosted by proceeds from the sale of its Morningstar business.
The US dairy company revealed yesterday (9 May) profit in the three months rose to US$492.6m, up from $37.9m. The bottom line was impacted by the contribution of the Morninstar disposal, which was sold to Saputo in January in a deal worth US$1.45bn.
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Dean Foods is in the process of focusing its business on liquid milk sales and is spinning off its WhiteWave Foods, a 20% stake in which is already publicly listed. The remaining 80% will be divided between Dean Foods shareholders as the group looks to drive returns.
The company was quick to emphasise it will benefit from solid fundamentals, with cost reductions expected to offset volume pressure in liquid milk sales.
On an adjusted basis, net income rose to $53.9m, from $45.8m last year. Operating income was down however, dropping to $115.3m from $119.2m in the comparable period of last year. This reflected lower adjusted sales in the period, which dipped to $2.87bn from $2.89bn last year.
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By GlobalData
