Dean Foods reports lower than expected profits

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Profits for Dean Foods has lagged behind forecasted amounts for four of the last five quarters. For the fiscal third quarter, which ended February 28, Dean Foods reported a profit of 45 to 47 cents per share. That’s down 25 cents from the 65-cent average estimate that analysts expected.

The company has hired Goldman, Sachs & Co., to explore a wide range of options. One of those options would be putting itself up for sale. Industry analysts list Italy’s Parmalat Finanziaria SpA, the Saputo Group Inc., based in Montreal and Suiza Food Corporation — the nation’s largest dairy company – as likely buyers of the country’s second largest dairy company

Earnings for the year will be $2.50 to $2.55 per share compared to the forecast of $3.02. Dean Foods is among many companies who have listed rising energy costs for lower than expected profits. However, sluggish dairy sales for the company that derives 75 percent of its annual revenue from dairy sales has contributed to the problem also.

Chicago Sun Times

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