Dean Foods Q2 Earnings Beat Expectations

Dean Foods Co DF reported better-than-expected earnings for the second quarter on Monday. The Dallas, Texas-based company posted quarterly net income of $26.5 million, or $0.28 per share, versus a year-ago loss of $645,000, or $0.01 per share. Excluding non-recurring items, the company's adjusted earnings came in at $0.33 per share. Its sales shrank to $2.01 billion from $2.39 billion. However, analysts were expecting earnings of $0.26 per share on revenue of $2.07 billion. The average estimate among 8 Estimize users was for earnings of $0.26 per share and revenue of $2.06 billion. Its total volume fell 3 percent, while raw milk costs shrank 33 percent year-over-year. Chief Financial Officer Chris Bellairs said, "With volume performance coming in-line with our expectations and a generally favorable commodity environment, we delivered a fourth consecutive quarter of sequentially improving gross profit and operating income. For the quarter, our gross profit, on an absolute dollar basis, and our operating income, on a per gallon basis, was the highest we have had since 2012. Coupled with the debt refinancing completed last quarter, improved operating and cash flow performance have clearly strengthened our balance sheet and our leverage improved by over a full turn for a second consecutive quarter." For the third quarter, Dean Foods projects earnings of $0.17 to $0.27 per share, versus analysts' estimates of $0.21 per share. Dean Foods shares gained 0.40 percent to close at $17.73 on Friday.