DALLAS, May 11, 2015 /PRNewswire/ -- Dean Foods Company
(NYSE: DF) today reported first quarter 2015 results.
Highlights
- For the third consecutive quarter, operating results improved,
primarily due to price realization, and solid execution within an
easing commodity environment.
- Q1 net loss per share was $0.78
and adjusted net income per share was $0.24.
- During Q1, completed a comprehensive debt refinancing to
strengthen the balance sheet for the future.
- On May 4, launched
DairyPure®, the first and largest fresh, white milk
national brand with a national media campaign.
- Dean Foods is on-trend with consumers' growing focus on fresh,
local, protein-dense products with clean labels.
- Q2 adjusted diluted earnings are expected to be $0.20 to $0.30 per share.
Chief Executive Officer Gregg
Tanner said, "I'm very pleased with the progress we have
made over the last several quarters in support of our long-term,
sustainable business model. This past quarter, we continued to
deliver sequential improvements to our operational and financial
results, and we recapitalized our balance sheet to provide the
organization with significant flexibility going forward. We are
proud of our track record of innovation and last week's launch of
DairyPure, the country's first and largest fresh, white milk
national brand, will provide additional benefits to consumers, our
category, our customers and our company."
First Quarter 2015 Operating Results
Chief Financial
Officer Chris Bellairs said, "Dean
Foods' first quarter results reflect solid execution within an
easing commodity environment. In the first quarter, we witnessed
retailers lean first and foremost into pricing architectures to
restore profitability to dairy products and the dairy case. With
volume performance coming in-line with our expectations,
significant price realization was the primary driver of
sequentially improving results. We believe that we can drive
shareholder value as we leverage our improving operating results
and free cash flow performance, our enhanced capital structure and
the incremental opportunities associated with our new national
brand, DairyPure."
Financial Summary
*
|
|
Three Months Ended
March 31
|
(In millions,
except per share amounts)
|
|
2015
|
2014
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
|
GAAP
|
|
$ 478
|
$ 416
|
Adjusted
|
|
$ 477
|
$ 416
|
|
|
|
|
Operating Income
(Loss)
|
|
|
|
GAAP
|
|
$ (59)
|
$ 5
|
Adjusted
|
|
$ 52
|
$ 7
|
|
|
|
|
Interest
Expense
|
|
|
|
GAAP
|
|
$ 17
|
$ 15
|
Adjusted
|
|
$ 16
|
$ 15
|
|
|
|
|
Net Income
(Loss)
|
|
|
|
GAAP
|
|
$ (74)
|
$ (9)
|
Adjusted
|
|
$ 22
|
$ (5)
|
|
|
|
|
Diluted Earnings
(Loss) Per Share (EPS)
|
|
|
|
GAAP
|
|
$(0.78)
|
$(0.09)
|
Adjusted
|
|
$ 0.24
|
$(0.05)
|
|
* Adjustments to GAAP
for the impacts of specific transactions and other one-time or
non-recurring items are fully described in the attached
tables.
|
The first quarter 2015 average Class I Mover, a measure of raw
milk costs, was $16.79 per
hundred-weight, a 29% sequential decrease from the fourth quarter
of 2014 and a decrease of 25% from the first quarter of 2014. Total
volume across all products was 662 million gallons for the first
quarter of 2015, a 3% decline compared to total volume of 685
million gallons in the first quarter of 2014. Based on the USDA's
recently published category data, fluid milk volumes improved
sequentially from a 3.7% decline in the third quarter to a 3.4%
decline in the fourth quarter. For the month of January 2015, fluid milk volumes declined
approximately 3.1% year-over-year, on an unadjusted basis. On this
same basis, Dean Foods' share of U.S. fluid milk volumes decreased
to 35.5%, from 35.7% in the first quarter of 2014.
Tanner added, "In the longer term, we believe that the execution
of our strategy will improve our financial performance, and our
innovations will help enhance the already highly regarded
perception of our products within the category and in the minds of
the consumers. We are reinvigorating the dairy case with our
national brands DairyPure and TruMoo while building on the
heritage, brand equity and consumer confidence associated with our
regional brands. We are also changing the game with operational
excellence, disciplined financial stewardship and innovation as we
extend our leadership position in the dairy industry."
Cash Flow
Consolidated net cash provided by
continuing operations for the three months ended March 31, 2015, totaled $158 million. Free cash flow provided by
continuing operations, which is defined as net cash provided by
continuing operations less capital expenditures, was $138 million for three months ended March 31, 2015. Free cash flow for the quarter
includes $56 million of federal tax
refunds.
Debt
During the first quarter, the Company completed
its debt refinancing. In February, the Company issued 6.5% senior
unsecured notes due 2023 with an aggregate principal amount of
$700 million. The Company used a
portion of the net proceeds of the offering to finance the
redemption of its outstanding senior unsecured 7% notes due 2016
and used the remaining net proceeds to repay a portion of the
outstanding borrowings under the Company's senior secured credit
facility and receivables-backed facility. In March, the Company
entered into a new 5-year $450
million senior secured revolving credit facility.
Concurrently, the Company amended and restated its existing
$550 million receivables
securitization facility to extend the maturity through March 2018, and conform the covenants to the new
senior secured revolving credit facility.
Total debt at March 31, 2015, net
of $30 million cash on hand, was
approximately $823 million. The
Company's maximum senior secured net leverage ratio calculated in
accordance with the new $450 million
senior secured revolving credit facility, which for purposes of
calculating indebtedness deducts up to $50
million of cash on hand and excludes borrowings under the
receivables securitization facility, was zero times as of the end
of the first quarter of 2015. While no longer a financial covenant
under the Company's senior secured credit facility, the Company's
funded net debt to EBITDA ratio improved over a full turn from
December 31, 2014 to 3.35 times at
the end of the first quarter of 2015.
Forward Outlook
"With expected volume declines of low
single digits, and taking normal seasonality and other factors into
account, we expect second quarter adjusted diluted earnings of
between $0.20 and $0.30 per share,"
concluded Tanner.
Non-GAAP Financial Measures
In addition to the results
prepared in accordance with U.S. Generally Accepted Accounting
Principles ("GAAP"), we have presented certain adjusted financial
results and certain other non-GAAP financial measures, including
Adjusted EBITDA and Free Cash Flow, each as defined below.
These non-GAAP financial measures are from continuing operations
and are adjusted to eliminate the net expenses and net gains
related to the items identified in the "Reconciliation of GAAP to
Non-GAAP Information" tables below. This information is provided to
assist investors in making meaningful comparisons of our operating
performance between periods and to view our business from the same
perspective as our management. Because we cannot predict the
timing and amount of expenses or gains associated with certain
non-recurring items; asset impairment charges; gains or losses
related to discontinued operations and divestitures; facility
closing, reorganization and realignment costs; costs associated
with the early retirement of long-term debt; gains(losses) on the
mark-to-market of our derivative contracts; litigation settlements;
and certain other charges, our management does not consider these
items when evaluating our performance, when making decisions
regarding the allocation of resources, in determining incentive
compensation for management, or in determining earnings
estimates.
We have defined Adjusted EBITDA as net income (loss), which is
the most comparable GAAP financial measure, adjusted for the items
above as well as interest, taxes, depreciation and amortization. We
believe Adjusted EBITDA is a useful measure for analyzing the
performance of our business and is an indicator of our ability to
incur and service indebtedness and generate free cash flow. We also
believe that EBITDA measures are commonly reported and widely used
by investors and other interested parties as measures of a
company's operating performance and debt servicing ability because
such measures assist in comparing performance on a consistent basis
without regard to capital structure, depreciation or amortization
(which can vary significantly) and non-operating factors (such as
historical cost). EBITDA is also a widely-accepted financial
indicator of a company's ability to incur and service indebtedness.
The reconciliation of net income to Adjusted EBITDA for the three
months ended March 31, 2015 and 2014
is included in the tables below.
Additionally, we believe free cash flow provided by continuing
operations ("Free Cash Flow") is a meaningful non-GAAP measure that
offers supplemental information and insight regarding the liquidity
of our operations and our ability to generate sufficient cash flow
above what is required in our business to sustain our
operations.
We define Free Cash Flow as net cash provided by continuing
operations less cash payments for capital expenditures. A
reconciliation of net cash provided by continuing operations, which
is the most comparable U.S. GAAP financial measure to Free Cash
Flow is included in the tables below.
This non-GAAP financial information is provided as additional
information for investors and is not in accordance with, or an
alternative to, GAAP. Additionally, these non-GAAP measures may be
different than similar measures used by other companies. We believe
that the presentation of these non-GAAP financial measures, when
considered together with our GAAP financial measures and the
reconciliations to the corresponding GAAP financial measures,
provides investors with a more complete understanding of the
factors and trends affecting our business than could be obtained
absent these disclosures. A full reconciliation of our
results and financial measures reported in accordance with GAAP for
the three months ended March 31, 2015
and 2014 to the non-GAAP financial measures described above is set
forth herein.
Conference Call/Webcast
A webcast to discuss the
Company's financial results and outlook will be held at
9:00 a.m. ET today and may be heard
live by visiting the "Webcast" section of the Company's website at
http://www.deanfoods.com/. A slide presentation will accompany the
webcast.
About Dean Foods
Dean Foods® is a leading
food and beverage company and the largest processor and
direct-to-store distributor of fluid milk and other dairy and dairy
case products in the United
States. Headquartered in Dallas,
Texas, the Dean Foods portfolio includes
DairyPure®, the country's first and largest fresh, white
milk national brand, and TruMoo®, the leading national flavored
milk brand, along with well-known regional dairy brands such as
Alta Dena®, Berkeley
Farms®, Country Fresh®, Dean's®,
Garelick Farms®, LAND O LAKES®* milk and
cultured products*, Lehigh Valley Dairy Farms®,
Mayfield®, McArthur®, Meadow
Gold®, Oak Farms®, PET®**,
T.G. Lee®,
Tuscan® and more. In all, Dean Foods has more than 50
local and regional dairy brands and private labels. Dean Foods also
makes and distributes ice cream, cultured products, juices, teas,
and bottled water. Over 17,000 employees across the country work
every day to make Dean Foods the most admired and trusted provider
of wholesome, great-tasting dairy products at every occasion. For
more information about Dean Foods and its brands, visit
www.deanfoods.com.
*The LAND O LAKES brand is owned by Land O'Lakes, Inc. and is used
by license.
**PET is a trademark of The J.M. Smucker Company and is used by
license.
Some of the statements made in this press release are
"forward-looking" and are made pursuant to the safe harbor
provision of the Private Securities Litigation Reform Act of 1995,
including statements relating to: (1) projected sales (including
specific product lines and the Company as a whole), profit margins,
net income, earnings per share, free cash flow and debt covenant
compliance, (2) the Company's regional and national branding
initiatives, (3) the Company's innovation, research and development
plans and its ability to successfully launch new products or
brands, (4) commodity prices and other inputs and the Company's
ability to forecast or predict commodity prices, milk production
and milk exports, (5) the Company's cost-savings initiatives,
including plant closures and route reductions, and its ability to
achieve expected savings, (6) planned capital expenditures, (7) the
status of the Company's litigation matters, (8) the Company's
plans related to its capital structure, (9) the Company's dividend
policy and (10) possible repurchases of shares of common stock.
These statements involve risks and uncertainties that may cause
results to differ materially from those set forth in this press
release. Financial projections are based on a number of
assumptions. Actual results could be materially different
than projected if those assumptions are erroneous. The cost
and supply of commodities and other raw materials are determined by
market forces over which the Company has limited or no control.
Sales, operating income, net income, debt covenant compliance,
financial performance and adjusted earnings per share can vary
based on a variety of economic, governmental and competitive
factors, which are identified in the Company's filings with the
Securities and Exchange Commission. The Company's ability to profit
from its branding initiatives depends on a number of factors
including consumer acceptance of its products. The
declaration and payment of cash dividends under the Company's
dividend policy remains at the sole discretion of the Board of
Directors or a committee thereof and will depend upon its financial
results, cash requirements, future prospects, restrictions in its
credit agreement and debt covenant compliance, applicable law and
other factors that may be deemed relevant by the Board or such
committee. All forward-looking statements in this press release
speak only as of the date of this press release. The Company
expressly disclaims any obligation or undertaking to release
publicly any updates or revisions to any such statements to reflect
any change in our expectations with regard thereto or any changes
in the events, conditions or circumstances on which any such
statement is based except as required by law.
CONTACT: Corporate Communications, Jamaison Schuler, +1-214-721-7766; or Investor
Relations, Scott Vopni,
+1-214-303-3438
DEAN FOODS
COMPANY
|
Condensed
Consolidated Statements of Operations
|
(Unaudited)
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Three months
ended
|
|
|
|
|
March 31,
|
|
March 31,
|
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
GAAP
|
|
Adjusted*
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
$ 2,050,762
|
|
$ 2,341,040
|
|
$ 2,050,762
|
|
$ 2,341,040
|
|
Cost of
sales
|
|
|
1,572,453
|
|
1,924,865
|
|
1,573,734
|
(d)
|
1,925,272
|
(a) (d)
|
Gross
profit
|
|
|
478,309
|
|
416,175
|
|
477,028
|
|
415,768
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
|
|
|
Selling and
distribution
|
|
|
338,184
|
|
339,379
|
|
337,194
|
(d)
|
339,415
|
(b) (d)
|
General and
administrative
|
|
|
87,476
|
|
72,299
|
|
87,494
|
(d)
|
68,755
|
(b)
|
Amortization of
intangibles
|
|
|
706
|
|
744
|
|
706
|
|
744
|
|
Facility closing and
reorganization costs
|
|
|
1,245
|
|
977
|
|
-
|
(b)
|
-
|
(b)
|
Litigation
settlements
|
|
|
-
|
|
(2,521)
|
|
-
|
|
-
|
(d)
|
Impairment on
intangibles
|
|
|
109,910
|
|
-
|
|
-
|
(a)
|
-
|
|
Total operating costs
and expenses
|
|
|
537,521
|
|
410,878
|
|
425,394
|
|
408,914
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
(59,212)
|
|
5,297
|
|
51,634
|
|
6,854
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
16,528
|
|
15,023
|
|
16,102
|
(d)
|
14,577
|
(d)
|
Loss on early
retirement of long-term debt
|
|
|
43,609
|
|
-
|
|
-
|
(c)
|
-
|
|
Other income,
net
|
|
|
(446)
|
|
(321)
|
|
(446)
|
|
(321)
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations before income taxes
|
|
|
(118,903)
|
|
(9,405)
|
|
35,978
|
|
(7,402)
|
|
Income tax expense
(benefit)
|
|
|
(45,252)
|
|
387
|
|
13,672
|
(e)
|
(2,813)
|
(e)
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations
|
|
(73,651)
|
|
(9,792)
|
|
22,306
|
|
(4,589)
|
|
Income (loss) on sale
of discontinued operations, net of tax
|
|
(89)
|
|
836
|
|
-
|
(d)
|
-
|
(d)
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
|
$ (73,740)
|
|
$ (8,956)
|
|
$ 22,306
|
|
$ (4,589)
|
|
|
|
|
|
|
|
|
|
|
|
|
Average common
shares:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
94,222
|
|
94,399
|
|
94,222
|
|
94,399
|
|
Diluted
|
|
|
94,222
|
|
94,399
|
|
94,593
|
(f)
|
94,399
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per common share:
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations
|
|
|
$ (0.78)
|
|
$ (0.10)
|
|
$ 0.24
|
|
$ (0.05)
|
|
Income from
discontinued operations
|
|
|
-
|
|
0.01
|
|
-
|
|
-
|
|
Net income
(loss)
|
|
|
$ (0.78)
|
|
$ (0.09)
|
|
$ 0.24
|
|
$ (0.05)
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per common share:
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations
|
|
|
$ (0.78)
|
|
$ (0.10)
|
|
$ 0.24
|
|
$ (0.05)
|
|
Income from
discontinued operations
|
|
|
-
|
|
0.01
|
|
-
|
|
-
|
|
Net income
(loss)
|
|
|
$ (0.78)
|
|
$ (0.09)
|
|
$ 0.24
|
|
$ (0.05)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* See notes to
Earnings Release Tables
|
|
DEAN FOODS
COMPANY
|
Computation of
Adjusted EBITDA
|
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
March 31,
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
Net income
(loss)
|
|
$ 22,306
|
|
$ (4,589)
|
Interest
expense
|
|
16,102
|
|
14,577
|
Income tax expense
(benefit)
|
|
13,672
|
|
(2,813)
|
Depreciation and
amortization
|
|
37,897
|
|
38,678
|
Adjusted
EBITDA
|
|
|
$ 89,977
|
|
$ 45,853
|
|
DEAN FOODS
COMPANY
|
Condensed
Consolidated Balance Sheets
|
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December
31,
|
ASSETS
|
|
2015
|
|
2014
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$ 30,056
|
|
$ 16,362
|
|
|
|
|
|
|
Other current
assets
|
|
1,010,733
|
|
1,163,698
|
|
|
|
|
|
|
Total current
assets
|
|
|
1,040,789
|
|
1,180,060
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
1,158,550
|
|
1,172,596
|
|
|
|
|
|
|
Intangibles and other
assets, net
|
|
314,168
|
|
416,980
|
|
|
|
|
|
|
Total
Assets
|
|
|
$ 2,513,507
|
|
$ 2,769,636
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities, excluding debt
|
|
|
$ 712,677
|
|
$ 793,753
|
|
|
|
|
|
|
Total long-term debt,
including current portion
|
|
853,426
|
|
917,179
|
|
|
|
|
|
|
Other long-term
liabilities
|
|
396,797
|
|
431,386
|
|
|
|
|
|
|
Total stockholders'
equity
|
|
|
550,607
|
|
627,318
|
|
|
|
|
|
|
Total Liabilities and
Stockholders' Equity
|
|
|
$ 2,513,507
|
|
$ 2,769,636
|
|
DEAN FOODS
COMPANY
|
Condensed
Consolidated Statements of Cash Flows
|
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
Three months
ended
|
|
March 31,
|
Operating
Activities
|
2015
|
|
2014
|
|
Net cash provided by
operating activities
|
$ 157,579
|
|
$ 32,799
|
|
|
|
|
Investing
Activities
|
|
|
|
Payments for
property, plant and equipment
|
(19,304)
|
|
(28,035)
|
Proceeds from sale of
fixed assets
|
1,638
|
|
1,372
|
|
Net cash used in
investing activities
|
(17,666)
|
|
(26,663)
|
|
|
|
|
Financing
Activities
|
|
|
|
Net proceeds from
debt
|
408,852
|
|
65,526
|
Early retirement of
long-term debt
|
(476,188)
|
|
-
|
Premiums paid on
early retirement of debt
|
(37,309)
|
|
-
|
Payments of financing
costs
|
(14,796)
|
|
-
|
Issuance of common
stock, net of share repurchases
|
-
|
|
(25,000)
|
Cash dividend
paid
|
(6,604)
|
|
(6,543)
|
Other
|
234
|
|
1,128
|
|
Net cash provided by
(used in) financing activities
|
(125,811)
|
|
35,111
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(408)
|
|
(258)
|
|
|
|
|
Increase in cash and
cash equivalents
|
13,694
|
|
40,989
|
Cash and cash
equivalents, beginning of period
|
16,362
|
|
16,762
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$ 30,056
|
|
$ 57,751
|
|
|
|
|
|
|
|
|
Computation of
Free Cash Flow provided by continuing operations
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
$ 157,579
|
|
$ 32,799
|
Payments for
property, plant and equipment
|
(19,304)
|
|
(28,035)
|
|
|
|
|
|
|
Free cash flow
provided by continuing operations
|
$ 138,275
|
|
$ 4,764
|
|
DEAN FOODS
COMPANY
|
Reconciliation of
GAAP to Adjusted Earnings
|
(Unaudited)
|
(In thousands,
except per share data)
|
|
|
|
|
Three months
ended
|
|
|
March 31,
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
write-downs
|
|
Facility
closing,
|
|
Loss on
early
|
|
|
|
|
|
|
|
|
|
|
|
and (gain) loss
on
|
|
reorganization
and
|
|
retirement
of
|
|
Other
|
|
Income
|
|
|
|
|
|
|
|
sale of
assets
|
|
realignment
costs
|
|
long-term
debt
|
|
adjustments
|
|
tax
|
|
|
|
|
|
GAAP
|
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
(e)
|
|
Adjusted*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dean Foods
|
|
$ 51,943
|
|
$ -
|
|
$ -
|
|
$ -
|
|
$ (309)
|
|
$ -
|
|
$ 51,634
|
|
Facility closing and
reorganization costs
|
|
(1,245)
|
|
-
|
|
1,245
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Impairment on
intangibles
|
|
(109,910)
|
|
109,910
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Total operating
income (loss)
|
|
(59,212)
|
|
109,910
|
|
1,245
|
|
-
|
|
(309)
|
|
-
|
|
51,634
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
Interest
expense
|
|
16,528
|
|
-
|
|
-
|
|
-
|
|
(426)
|
|
-
|
|
16,102
|
|
Loss on early
retirement of long-term debt
|
|
43,609
|
|
-
|
|
-
|
|
(43,609)
|
|
-
|
|
-
|
|
-
|
|
Other income,
net
|
|
(446)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(446)
|
|
Income tax expense
(benefit)
|
|
(45,252)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
58,924
|
|
13,672
|
|
Income (loss) from
continuing operations
|
|
(73,651)
|
|
109,910
|
|
1,245
|
|
43,609
|
|
117
|
|
(58,924)
|
|
22,306
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
Loss on sale from
discontinued operations, net of tax
|
|
(89)
|
|
-
|
|
-
|
|
-
|
|
89
|
|
-
|
|
-
|
|
Net income
(loss)
|
|
$ (73,740)
|
|
$ 109,910
|
|
$ 1,245
|
|
$ 43,609
|
|
$ 206
|
|
$ (58,924)
|
|
$ 22,306
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share (f)
|
|
$ (0.78)
|
|
$ 1.17
|
|
$ 0.01
|
|
$ 0.46
|
|
$ 0.01
|
|
$ (0.63)
|
|
$ 0.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
March 31,
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset
write-downs
|
|
Facility
closing,
|
|
Loss on
early
|
|
|
|
|
|
|
|
|
|
|
|
and (gain) loss
on
|
|
reorganization
and
|
|
retirement
of
|
|
Other
|
|
Income
|
|
|
|
|
|
|
|
sale of
assets
|
|
realignment
costs
|
|
long-term
debt
|
|
adjustments
|
|
tax
|
|
|
|
|
|
GAAP
|
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
(e)
|
|
Adjusted*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dean Foods
|
|
$ 3,753
|
|
$ 426
|
|
$ 3,654
|
|
$ -
|
|
$ (979)
|
|
$ -
|
|
$ 6,854
|
|
Facility closing and
reorganization costs
|
|
(977)
|
|
-
|
|
977
|
|
-
|
|
-
|
|
-
|
|
-
|
|
Litigation
settlements
|
|
2,521
|
|
-
|
|
-
|
|
-
|
|
(2,521)
|
|
-
|
|
-
|
|
Total operating
income
|
|
5,297
|
|
426
|
|
4,631
|
|
-
|
|
(3,500)
|
|
-
|
|
6,854
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
Interest
expense
|
|
15,023
|
|
-
|
|
-
|
|
-
|
|
(446)
|
|
-
|
|
14,577
|
|
Other income,
net
|
|
(321)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(321)
|
|
Income tax
expense
|
|
387
|
|
-
|
|
-
|
|
-
|
|
-
|
|
(3,200)
|
|
(2,813)
|
|
Income (loss) from
continuing operations
|
|
(9,792)
|
|
426
|
|
4,631
|
|
-
|
|
(3,054)
|
|
3,200
|
|
(4,589)
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
-
|
|
Income from
discontinued operations, net of tax
|
|
836
|
|
-
|
|
-
|
|
-
|
|
(836)
|
|
-
|
|
-
|
|
Net income
(loss)
|
|
$ (8,956)
|
|
$ 426
|
|
$ 4,631
|
|
$ -
|
|
$ (3,890)
|
|
$ 3,200
|
|
$ (4,589)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings
(loss) per share
|
|
$ (0.09)
|
|
$ -
|
|
$ 0.05
|
|
$ -
|
|
$ (0.04)
|
|
$ 0.03
|
|
$ (0.05)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* See notes to
Earnings Release Tables
|
|
For the three months
ended March 31, 2015 and 2014, the adjusted results and certain
other non-GAAP financial measures differ from the Company's results
under GAAP due to the exclusion of net gains or net losses
associated with certain non-recurring items, including facility
closing, reorganization and realignment costs; costs associated
with the early retirement of long-term debt; (gains) losses on the
mark-to-market of our derivative contracts; litigation settlements;
discontinued operations as well as asset impairment charges. These
adjustments are made to facilitate meaningful comparisons of our
operating performance between periods as the Company cannot predict
the timing and amount of charges associated with such
items.
|
|
|
(a)
|
The adjustment
reflects the elimination of the following:
|
|
|
|
|
|
|
i.
|
In conjunction with
our decision to launch DairyPure in the first quarter of
2015, we changed certain indefinite lived assets to finite lived
resulting in a triggering event for impairment testing purposes. As
a result, we recorded a non-cash charge of $109.9 million ($68.7
million net of tax) related to the impairment of certain of our
intangible assets; and
|
|
|
|
ii.
|
Accelerated
depreciation related to machinery and equipment at certain of our
production facilities as a result of revisions made to the
estimated remaining useful lives due to our evaluation of the
impact that we expect changes in our business to have on estimated
future cash flows at those production facilities.
|
|
|
|
|
|
(b)
|
The adjustment
reflects the elimination of severance charges and non-cash asset
write-downs related to approved facility closings and restructuring
plans, as well as other organizational realignment
activities.
|
|
|
|
|
|
(c)
|
During the first
quarter of 2015, we retired the remaining principle amount of
$476.2 million of our 2016 senior notes. As a result we recorded a
$38.3 million pre-tax loss on the early retirement of
long-term debt in the first quarter of 2015, which consisted of
debt redemption premiums of $37.3 million, a write-off of
unamortized debt issue costs of $0.8 million and write-off of the
remaining bond discount and interest rate swaps of $0.2 million. In
addition, in conjunction with the execution of a new credit
agreement and amendment our receivables-backed facility in the
first quarter of 2015, we wrote-off unamortized debt issue costs of
$5.3 million. The adjustment reflects the elimination of these
losses.
|
|
|
|
|
|
(d)
|
The adjustment
reflects the elimination of the following:
|
|
|
|
|
|
|
i.
|
Interest accretion in
connection with our previously disclosed dairy farmer class action
lawsuit filed in the United States District Court for the Eastern
District of Tennessee. The Court granted final approval of the
settlement agreement on June 15, 2012;
|
|
|
|
|
|
|
ii.
|
The gain on the mark
to market of our commodity derivative contracts for the three
months ended March 31, 2015 and 2014. Effective January 1, 2014, we
have de-designated all open commodity derivative positions that
were previously designated as hedges. As of the de-designation
date, all commodities contracts are now marked to market in our
income statement at each reporting period and a derivative asset or
liability is recorded on our balance sheet;
|
|
|
|
|
|
|
iii.
|
A reduction in a
litigation settlement liability due to plaintiff class "opt-outs"
of $2.5 million during the three months ended March 31, 2014;
and
|
|
|
|
|
|
|
iv.
|
A taxing authority
settlement of certain retained contingent obligations related to
prior discontinued operations.
|
|
|
|
|
|
(e)
|
The adjustment
reflects the income tax impact on adjustments (a) through (d) and
to reflect our adjusted tax rate at 38%, which we believe
represents our normalized long-term effective tax rate as a U.S.
domiciled business.
|
|
|
|
|
|
(f)
|
The adjustment
reflects an add-back of the dilutive shares, which were
anti-dilutive for GAAP purposes.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/dean-foods-announces-first-quarter-2015-results-300080648.html
SOURCE Dean Foods Company