Will Dean Foods' Q1 Profit Top Consensus?

(RTTNews) - Dairy producer Dean Foods Co. (DF) expects global dairy fundamentals to continue to be overall supportive to its business as production growth continues to outpace demand. Year-over-year, total milk production from the top seven exporters continues to increase, albeit at a much slower pace compared to the initial robust expansion experienced in 2014.

With the continuation of commercial and brand initiatives, diligent cost focus, and an overall favorable commodity environment, the company expects its strong operating and financial momentum to continue.

The company is slated to release its first-quarter numbers before the bell on Tuesday, May 9, with analysts polled by Thomson Reuters estimating earnings of $0.38 per share on revenue of $1.89 billion. Analysts' estimate typically exclude certain special items.

The company projects first-quarter adjusted earnings to range between $0.32 and $0.42 per share. Meanwhile, the company expects first-quarter total volumes to decline in the low single digits.

For the full year the company expects its capital expenditures to be about $160 million, consistent with its capital spend in 2015.

In The Last Quarter...

Dean Foods reported higher profit for the fourth-quarter, despite a 16% decline in sales. Adjusted earnings per share topped analysts' expectations, while quarterly sales missed their estimates.

Net income for the fourth-quarter surged to $18.48 million or $0.20 per share from $5.28 million or $0.06 per share in the prior year.

Quarterly adjusted net income jumped to $32.80 million or $0.36 per share from $7.08 million or $0.08 per share in the prior year. Analysts expected earnings of $0.34 per share for the quarter.

Income from continuing operations for the quarter surged to $18.82 million from $5.74 million last year.

But, net sales for the quarter declined to $2.02 billion from last year's $2.40 billion. Wall Street expected revenues of $2.07 billion.

Total volume across all products was 658 million gallons for the fourth quarter of 2015, a 3.6% decline compared to total volume of 683 million gallons in the fourth quarter of 2014.