Reuters: Global Markets: Dean Foods lifts view; shares jump despite departures

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Dean Foods lifts view; shares jump despite departures Nov 8th 2012, 15:07 Thu Nov 8, 2012 10:07am EST (Reuters) - Dean Foods Co (DF.N) on Thursday reported better-than-expected quarterly profit and raised its full-year outlook, sending its shares up 5. 4 percent, even as the nation's largest dairy company said two top executives were leaving. Dean, which spun off part of its business last month into WhiteWave Foods Co (WWAV.N) and is weighing a sale of its Morningstar unit, said Chief Financial Officer Shaun Mara, and the general counsel, Steve Kemps, will leave the company. The resignations will follow the departure of Dean's prior chief executive, Gregg Engles, who became the CEO of WhiteWave, but remains Dean's chairman. Gregg Tanner, formerly president of the fresh dairy business, became Dean's CEO. Chris Bellairs, currently CFO of Dean's Fresh Dairy Direct business, will take over as CFO of Dean Foods. Rachel Gonzalez, deputy general counsel, will take over as general counsel. If WhiteWave, which makes Silk soy milk and Horizon Organic dairy products, is fully spun off, and Dean sells Morningstar, maker of mostly private label dairy products, it would be left with the Fresh Dairy Direct business, which sells fresh fluid milk. That business has been under pressure for years due to higher ingredient costs and falling prices. The company was forced to take a $1.9 billion charge a year ago to write down goodwill in that unit since its value had fallen significantly. Dean said Thursday the Morningstar sale process was ongoing and it would make an announcement when and if a deal is reached. PROFIT TOPS VIEW Dean reported third quarter net income $36.4 million, or 20 cents per share, compared with a net loss of $1.5 billion, or $8.39 per share, a year earlier, when it took the goodwill impairment charge. Excluding items, Dean earned 33 cents per share, handily topping analysts' average estimate of 26 cents, according to Thomson Reuters I/B/E/S. Sales fell 8 percent to $3.14 billion, missing analysts' target of $3.23 billion. Sales in the WhiteWave-Alpro business climbed 13 percent to $598 million. The company raised its full-year adjusted earnings forecast to between $1.27 and $1.32 per share, from its previous range of $1.18 to $1.28. Analysts were looking for a profit of $1.19, according to Thomson Reuters I/B/E/S. Dean expects fourth-quarter adjusted earnings of between 27 cents and 32 cents per share, largely above analysts' estimates of 26 cents. Shares of the company rose nearly 87 cents to $16.95. (Reporting by Martinne Geller in New York and Ranjita Ganesan in Bangalore; Editing by Supriya Kurane and Jeffrey Benkoe) Link this Share this Digg this Email Reprints

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