Dean Foods Co's net income from continuing operations for the 2007 third quarter totaled $6.5 million, compared with $74.5 million in the prior year's third quarter.
“In the third quarter, we were faced with the most difficult operating environment in our history,” said Gregg Engles, chairman and chief executive officer. “Raw milk prices rose rapidly to record highs, and we were challenged to increase our pricing fast enough to keep pace. Additionally, as retail prices spiked, rising an average of 75 cents per gallon over the course of this year, volumes softened, and our sales mix skewed more heavily toward private label milk. At the same time, we continued to work to overcome the negative effects of the increase in the cost of shrink, lower offsets to cost of goods sold from excess cream sales, and continued increased investment behind the Horizon Organic brand.”
Net sales for the third quarter totaled $3.1 billion, a gain of 24% from net sales for the third quarter of 2006, due to the pass-through of higher commodity dairy costs and increased sales at WhiteWave Foods.
Consolidated operating income in the third quarter totaled $103.3 million, a decrease of 39% from $168.7 million in the third quarter of 2006. Adjusted third quarter consolidated operating income was $123.1 million, down 29% from $174.2 million in third quarter 2006.