Suiza Foods Corporation (NYSE: SZA), the nation’s leading dairy processor and distributor, today announced net sales grew 8.0% over the third quarter of 2000 to $1.6 billion for the quarter ended September 30, 2001. Diluted earnings per share before non-recurring items for the quarter totaled $0.98, a decline of 3.9% from $1.02 in the third quarter of 2000. As previously announced, the decline in earnings per share was entirely attributable to weaker than expected results at Consolidated Container Company, the packaging business in which Suiza owns a 43% interest. Had Consolidated Container’s results been in line with expectations, Suiza would have reported diluted earnings per share of $1.10, growth of 7.8% over the prior year and consistent with consensus estimates.

Diluted cash earnings per share before non-recurring items for the third quarter totaled $1.18 compared with $1.23 in the prior year comparable period. Excluding Consolidated Container’s shortfall, cash earnings per share would have been $1.30, an increase of 5.7% over the prior year third quarter. The calculation of cash earnings per share excludes amortization of goodwill and certain intangibles as if the recently issued Financial Accounting Standard No. 142, “Goodwill and Other Intangible Assets” had been effective for the periods.

“Our operating units turned in solid performances in spite of continued high raw material prices and softness in volumes due to September 11th,” said Gregg Engles, Chairman and Chief Executive Officer of Suiza Foods Corporation. “Our operating results this quarter once again demonstrate our ability to manage through a difficult environment.”

Third quarter consolidated operating income before non-recurring items grew 2.9% to $98.2 million, or 6.3% of sales, compared with $95.4 million reported in the third quarter of 2000. Consolidated operating margin before non-recurring items declined 32 basis points due to high raw material costs during the quarter. Butterfat averaged $2.32 per pound during the quarter, up 82% over the prior year, and raw milk averaged $15.43 per hundred weight, 28% higher than the third quarter of 2000.

Sales for the first nine months of 2001 totaled $4.6 billion, an increase of 6.8% over last year. Operating income before non-recurring items for the nine months grew 2.8% to $285.8 million. Before non-recurring items, diluted earnings per share totaled $2.90, an increase of 4.3% over last year, and diluted cash earnings per share totaled $3.50, an increase of 4.2%. Excluding Consolidated Container’s shortfall in the third quarter, diluted earnings per share before non-recurring items would have risen 8.6% to $3.02 and diluted cash earnings per share would have been $3.62, an increase of 7.7%.

— During the third quarter, Suiza’s Morningstar subsidiary began bottling
and distributing Hershey(R)’s flavored milks and milkshakes in plastic
bottles, using new European extended-shelf-life technology that was
successfully installed in the company’s Mt. Crawford plant in Virginia.
The flavored milks are available in fat free chocolate, 2% reduced fat
chocolate and 2% reduced fat strawberry; and the new milkshakes are
available in creamy chocolate and cookies-n-cream. The new flavored
milks and shakes will have a longer shelf life of up to 60 days. The
company anticipates installing another line in spring 2002 to meet
increasing demand.
— In September, both Suiza and Dean Foods (NYSE: DFnews) independently
announced that their shareholders approved the proposed merger. The
companies continue to await regulatory approval from the Department of

“We believe that we are near completion of the process, and we continue to expect to close the transaction by year end,” said Engles.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Suiza Foods Corporation, based in Dallas, is the nation’s leading dairy processor and distributor, producing a full line of company-branded and customer-branded products. National brands include International Delight®, Second Nature®, Naturally Yours®, Mocha Mix®, Sun Soy(TM), kidsmilk(TM) and fitmilk®. Regional brands include Adohr Farms®, Barbe’s®, Broughton®, Brown’s Dairy(TM), Country Delite®, Country Fresh®, Dairy Gold®, Dairymens®, Flav-O-Rich®, Garelick Farms®, Hygeia®, Lehigh Valley Farms®, London’s®, Meadow Gold®, Model Dairy®, Oak Farms®, Poudre Valley®, Robinson®, Schenkel’s All Star Dairy, Schepps®, Shenandoah’s Pride®, Suiza Dairy®, Swiss Dairy(TM), Louis Trauth Dairy®, Tuscan® and Velda Farms®, as well as Celta® in Spain. Suiza also sells products under partner or licensed brands in certain regions, including Borden®, Foremost®, Hershey®’s and Pet®. Additionally, the company owns approximately 43% of Consolidated Container Company, one of the nation’s largest manufacturers of rigid plastic containers.

Forward-Looking Statement

The statement in this press release regarding the expected timing for completion of the proposed merger with Dean Foods is “forward-looking” and is made pursuant to the safe harbor provision of the Securities Litigation Reform Act of 1995. This statement involves risks and uncertainties that could cause results to differ materially from the statements set forth in this press release. The company’s ability to close the proposed transaction on the terms and in the timeframe contemplated depends primarily on the company’s ability to obtain regulatory approval for the transaction on the terms and within the timeframe contemplated. Other risks relating to the proposed merger with Dean Foods are identified in the joint press release of the company and Dean Foods filed by the company with the Securities and Exchange Commission with its Form 8-K dated April 5, 2001, as amended on April 10, 2001. Risks regarding the company’s business are set forth in its quarterly report on Form 10-Q for the quarter ended June 30, 2001. The forward-looking statement in this press release speaks only as of the date of this release. Suiza expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statement to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which such statement is based.

                              (Tables to follow)

Condensed Balance Sheet
(Dollars in thousands)

September 30, December 31,
ASSETS 2001 2000

Cash and cash equivalents $25,761 $31,110
Other current assets 868,693 786,821
Total current assets 894,454 817,931

Property, plant & equipment 1,011,645 1,003,769

Intangibles & other assets 1,926,679 1,958,778

Total Assets $3,832,778 $3,780,478


Total current liabilities $719,007 $699,908

Long-term debt 1,119,087 1,225,045

Other long-term liabilities 200,281 157,816

Mandatorily redeemable TIPES 584,459 584,032

Minority interest in subsidiaries 515,472 514,845

Stockholders’ equity:
Common stock 281 273
Additional paid-in capital 199,593 166,361
Retained earnings 519,405 433,309
Other comprehensive income (24,807) (1,111)
Total stockholders’ equity 694,472 598,832

Total Liabilities and
Stockholders’ Equity $3,832,778 $3,780,478

Segment Information
(Dollars in Thousands)

Three Months Ended Nine Months Ended
September 30, September 30,
2001 2000 2001 2000
Suiza Dairy Group $1,272,119 $1,176,168 $3,716,980 $3,463,702
Morningstar Foods 184,105 175,473 543,807 504,118
Corporate / Other 99,507 88,306 296,371 300,622
Consolidated $1,555,731 $1,439,947 $4,557,158 $4,268,442

Operating Income before
Non-Recurring Items
Suiza Dairy Group $76,143 $71,817 $219,298 $216,014
Morningstar Foods 21,825 25,415 68,090 69,205
Corporate / Other 199 (1,813) (1,597) (7,208)
Consolidated $98,167 $95,419 $285,791 $278,011

(Dollars in thousands, except per share data)

Three months ended Nine months ended
September 30, September 30,
2001 2000 2001 2000

Net sales $1,555,731 $1,439,947 $4,557,158 $4,268,442
Cost of sales 1,195,435 1,085,627 3,477,209 3,213,745

Gross profit 360,296 354,320 1,079,949 1,054,697

Operating costs and
expenses 262,129 258,901 794,158 776,685
Plant closing costs — 424 843 3,388

Operating income 98,167 94,995 284,948 274,624

Interest expense & financing
charges on preferred
securities 31,653 37,382 101,680 108,322
Equity in (earnings) loss
from unconsolidated
affiliates 3,700 (5,169) 841 (10,572)
Equity in restructuring
charges of unconsolidated
affiliates 1,724 — 1,724 —
Other (income) expense 1,097 (594) 1,600 (1,670)

Income before income taxes
and minority interest 59,993 63,376 179,103 178,544

Income taxes 20,803 24,021 65,452 67,901
Minority interest 9,768 8,166 26,109 25,327

Net income before
extraordinary items 29,422 31,189 87,542 85,316

Extraordinary gain — — — 4,968
Cumulative effect of
accounting change — — (1,446) —

Net income $29,422 $31,189 $86,096 $90,284

Net income before
non-recurring items $30,408 $31,461 $88,857 $87,087

Diluted EPS before
non-recurring items $0.98 $1.02 $2.90 $2.78

Diluted cash EPS before
non-recurring items $1.18 $1.23 $3.50 $3.36

Basic earnings per share:
Income before extraordinary
items $1.06 $1.13 $3.17 $2.99
Extraordinary gain — — — 0.17
Cumulative effect of
accounting change — — (0.05) —
Net income $1.06 $1.13 $3.12 $3.16

Basic average common
shares (000’s) 27,861 27,624 27,595 28,531

Diluted earnings per share:
Income before extraordinary
items $0.95 $1.01 $2.86 $2.73
Extraordinary gain — — — 0.14
Cumulative effect of
accounting change — — (0.04) —
Net income $0.95 $1.01 $2.82 $2.87

Diluted average common
shares (000’s) 36,604 36,198 36,180 37,062

Summary Financial Information:
Depreciation $23,748 $23,768 $71,578 $71,865
Amortization of intangibles $13,116 $13,532 $39,914 $39,231
Amortization shown in
interest expense $643 $558 $1,975 $2,823