February 12, 2014

 

For the full year 2013, Dean Foods Company announced that it earned US$8.58 per diluted share as compared to US$1.70 per diluted share for the full year 2012. 

 

Full year 2013 reported results include the gain on disposition of WhiteWave common stock of US$416 million, the gain on sale of Morningstar of US$492 million (net of tax) and other one-time or non-recurring items. On an adjusted basis, the company earned US$0.86 per diluted share for the full year 2013, compared to US$0.77 for the full year 2012.

 

For the fourth quarter of 2013, the company reported a loss from continuing operations attributable to Dean Foods of US$0.40 per share, compared to fourth quarter 2012 income from continuing operations of US$0.08 per share. The loss for the fourth quarter of 2013 includes a US$63 million (net of tax) loss on the early retirement of debt, US$10 million (net of tax) of restructuring charges, and other one-time or non-recurring items. On an adjusted basis, fourth quarter 2013 diluted earnings from continuing operations were US$0.18 per share, compared to fourth quarter 2012 adjusted earnings of US$0.23 per share. 

 

Fourth quarter 2013 operating income totalled US$35 million, compared to fourth quarter 2012 operating income of US$38 million. Fourth quarter 2013 adjusted operating income totalled US$48 million, compared to US$62 million in the year-ago period on an adjusted basis.

 

Full year 2013 operating income totalled US$131 million, compared to full year 2012 operating income of US$261 million. Full year 2013 adjusted operating income totalled US$228 million, compared to US$256 million in the year ago period on an adjusted basis.

 

Net loss from continuing operations attributable to Dean Foods totalled US$37 million for the fourth quarter of 2013, compared with US$8 million in income the previous year. On an adjusted basis, fourth quarter net income from continuing operations attributable to Dean Foods totalled US$17 million, compared with US$21 million in the previous year. 

 

Net income attributable to Dean Foods totalled US$813 million for the full year 2013, compared with US$159 million in the previous year. On an adjusted basis, net income for the full year 2013 totalled US$82 million, compared to US$72 million in 2012. 

 

Dean Foods' share of US fluid milk sales volume increased to 35.7% during the fourth quarter of 2013 from 34.9% in the third quarter of 2013. Industry fluid milk volumes declined approximately 2.2% over-year in the fourth quarter on an unadjusted basis, based on USDA data and company estimates. Due to the previously disclosed loss of business at a large retailer, Dean Foods' unadjusted fluid milk volumes declined 9% on an over-year basis.

 

The company continued to make solid progress against its cost savings targets including the planned closure of eight to twelve (10-15%) of its manufacturing facilities by mid-2014. The company has closed eight plants and announced a ninth since its accelerated cost reduction initiatives began in the fourth quarter of 2012. 

 

Consolidated net cash used in continuing operations for the 12 months ended December 31, 2013 totalled US$331 million.

Total debt at December 31, 2013, net of US$17 million cash on hand, was approximately US$881 million. On an all cash netted basis, the company's leverage ratio was 2.21 times funded net debt to earnings before interests, taxes, depreciation and amortisations (EBITDA) at the end of 2013.

 

The company expect full year adjusted diluted earnings of US$0.73 to US$0.86 per share. It also expects first quarter adjusted diluted earnings per share to be approximately break-even with US$0.03 of potential risk or benefit implied.  Dean Foods expects their performance to improve throughout the year as they adjust to offset inflation, volume from new business flows into the system and their cost reduction initiatives continue to gain momentum.