FRANKLIN PARK, Ill., March 22 /PRNewswire/ — Dean Foods Company
(NYSE: DF) today announced record earnings for the third quarter ended
February 27, 2000, of $25.2 million, or $.67 per diluted share. Income from
continuing operations before plant closure charge for the third quarter of
fiscal 1999 was $8.0 million, or $.20 per diluted share.
“While net income was a third quarter record, and Dairy and Specialty
segment earnings and return on sales improved substantially compared to the
third quarter of fiscal 1999, results were still below management’s
expectations due to lower results in our Pickles segment,” stated Howard Dean,
Chairman and Chief Executive Officer. “Very aggressive promotion by the
branded market leader in pickles has depressed pricing, a condition we expect
will carry over into our fourth quarter.”
Net income for the fiscal 1999 third quarter, including a $7.7 million
pre-tax plant closure charge ($4.7 million after-tax, or $.12 per diluted
share), was $3.3 million, or $.08 per diluted share. Net sales for the third
quarter were $976.8 million, down 2% from $995.2 million in fiscal 1999,
primarily due to the pass-through of lower raw milk costs.
Net income for the first nine months of fiscal 2000 was $80.0 million, or
$2.05 per diluted share. Fiscal 1999 income from continuing operations before
plant closure charge was $54.3 million, or $1.34 per diluted share. Including
the plant closure charge, income from continuing operations for the first nine
months of fiscal 1999 was $49.5 million, or $1.22 per diluted share. Net
income for the first nine months of fiscal 1999 of $3.20 per diluted share
included the gain on disposition of the Company’s Vegetables segment of $2.05
per diluted share and a loss from discontinued operations of $.07 per diluted
share. For the first nine months of fiscal 2000, net sales increased 11% to
$3.0 billion, up from $2.8 billion in the comparable period of fiscal 1999.
“Dairy earnings increased more than 400% over the third quarter of fiscal
1999 due to lower raw milk costs, as well as improved plant performance
resulting from integration and plant rationalizations,” continued Mr. Dean.
“Specialty segment operating earnings increased 19% over the third quarter of
1999 as the result of a fiscal 1999 acquisition and continued performance
improvements in our Dean Dip and Dressing division.”
Third quarter corporate expenses decreased from the prior year period
primarily as a result of lower incentive and stock-based compensation
expenses.
Mr. Dean concluded, “We are pleased with the strong earnings in the third
quarter and first nine months for both the Dairy and Specialty segments. We
are disappointed with the third quarter results of the Pickles segment and we
see continued pressure on margins in the fourth quarter; however, we believe,
over the long-term, pickles will continue to be an excellent business for us,”
concluded Mr. Dean.
Dean Foods is one of the nation’s leading dairy processors and
distributors producing a full line of branded and private label products,
including fluid milk, ice cream and extended shelf life products, which are
sold under the Dean’s and other strong regional brand names. Dean Foods is
the industry leader in other food products including pickles, powdered non-
dairy coffee creamers, aseptically packaged foodservice products, and
refrigerated dips and salad dressings.
Certain statements in this press release are forward-looking as defined by
the Private Securities Litigation Reform Act of 1995. These statements
involve certain risks and uncertainties that may cause actual results to
differ materially from expectations as of the date of this press release.
These risks include, but are not limited to, the ability to integrate
acquisitions, adverse weather conditions resulting in poor harvest conditions,
raw milk and resin costs, interest rate fluctuations, competitive pricing
pressures, the effectiveness of marketing and cost-management programs and
shifts in market demand.
The Company’s quarterly earnings conference call will be held today at
10:00 a.m. Central Time. The call may be heard live at the Company’s web
site, http://www.deanfoods.com, using RealPlayer7 Basic software. The basic version
of RealPlayer7 may be downloaded at no charge from
http://www.real.com/products/player/index.html prior to the call. Please allow
approximately 15 minutes to download the software. Replays will be available
at the same internet address for a limited time period.
DEAN FOODS COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In Thousands)
February 27, February 28,
2000 1999
ASSETS
Current Assets:
Cash and temporary cash investments $23,682 $14,093
Accounts and notes receivable, net of
allowance for doubtful accounts 298,477 295,146
Inventories 197,360 184,739
Other current assets 86,316 73,653
Total current assets 605,835 567,631
Property, Plant and Equipment, net 796,149 708,575
Other Assets 595,058 475,559
Total Assets $1,997,042 $1,751,765
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Short-term notes payable $-- $28,200
Current installments of
long-term obligations 5,253 8,966
Accounts payable and accrued expenses 375,291 379,337
Dividends payable 8,113 8,537
Federal and state income taxes 51,456 21,311
Total current liabilities 440,113 446,351
Long-Term Obligations 764,430 497,589
Deferred Liabilities 122,337 84,639
Shareholders' Equity 670,162 723,186
Total Liabilities and
Shareholders' Equity $1,997,042 $1,751,765
DEAN FOODS COMPANY
CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
FOR THE PERIODS ENDED
FEBRUARY 27, 2000 AND FEBRUARY 28, 1999
(In Thousands Except for Per Share Amounts)
Third Quarter Ended Nine Months Ended
February 27, February 28, February 27, February 28,
2000 1999 2000 1999
(Unaudited)
Net sales $976,816 $995,169 $3,045,186 $2,754,650
Costs of products
sold 743,366 806,685 2,333,311 2,172,976
Delivery, selling and
administrative
expenses 179,016 164,667 544,186 465,505
Plant closure charge -- 7,730 -- 7,730
Operating earnings 54,434 16,087 167,689 108,439
Interest expense 13,401 10,898 37,134 27,947
Interest income 241 188 629 733
Income from continuing
operations before
income taxes 41,274 5,377 131,184 81,225
Provision for
income taxes 16,097 2,097 51,162 31,678
Income from continuing
operations 25,177 3,280 80,022 49,547
Discontinued operations,
net of taxes:
Loss from discontinued
operations -- -- -- (2,929)
Gain on sale of
discontinued
operations -- -- -- 83,820
Total discontinued
operations, net
of taxes -- -- -- 80,891
Net income $25,177 $3,280 $80,022 $130,438
Basic income (loss)
per share:
Income from continuing
operations before plant
closure charge $.67 $.20 $2.07 $1.35
Plant closure charge -- .12 -- .12
Income from continuing
operations .67 .08 2.07 1.23
Loss from discontinued
operations -- -- -- (.07)
Gain on sale of
discontinued
operations -- -- -- 2.10
Net income $.67 $.08 $2.07 $3.26
Diluted income (loss)
per share:
Income from continuing
operations before plant
closure charge $.67 $.20 $2.05 $1.34
Plant closure charge -- .12 - .12
Income from continuing
operations .67 .08 2.05 1.22
Loss from discontinued
operations -- -- -- (.07)
Gain on sale of
discontinued
operations -- -- -- 2.05
Net income $.67 $.08 $2.05 $3.20
Weighted average
common shares:
Basic 37,335 40,245 38,584 39,998
Diluted 37,652 40,737 39,094 40,733
DEAN FOODS COMPANY
BUSINESS SEGMENT INFORMATION
FOR THE PERIODS ENDED
FEBRUARY 27, 2000 AND FEBRUARY 28, 1999
(Unaudited)
(In Thousands)
Dairy Pickles Specialty Corporate Consolidated
THIRD QUARTER
ENDED
Feb. 27, 2000
Net sales $785,541 $85,283 $105,992 $-- $976,816
Operating
earnings $36,399 $5,442 $18,920 $(6,327) $54,434
Feb. 28, 1999
Net sales $803,333 $82,418 $109,418 $-- $995,169
Operating
earnings
before plant
closure
charge $6,730 $9,066 $15,957 $(7,936) $23,817
Plant closure
charge -- 7,730 -- -- 7,730
Operating
earnings $6,730 $1,336 $15,957 $(7,936) $16,087
NINE MONTHS ENDED
Feb. 27, 2000
Net sales $2,449,475 $272,065 $323,646 $-- $3,045,186
Operating
earnings $114,367 $25,770 $55,579 $(28,027) $167,689
Feb. 28, 1999
Net sales $2,196,940 $261,712 $295,998 $-- $2,754,650
Operating
earnings
before plant
closure
charge $69,296 $29,052 $42,569 $(24,748) $116,169
Plant closure
charge -- 7,730 -- -- 7,730
Operating
earnings $69,296 $21,322 $42,569 $(24,748) $108,439
SOURCE Dean Foods Company
Web site: http://www.deanfoods.com
Company News On-Call: http://www.prnewswire.com/comp/109161.htmlor fax, 800-758-5804, ext. 109161
CONTACT: Richard Bailey, President and Chief Operating Officer,or William Luegers, Treasurer, both of Dean Foods, 847-678-1680
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