Dreyer’s Earnings Climb as Sales Rise, Costs Drop

Dreyer’s Grand Ice Cream Inc., the nation’s largest ice cream maker, reported a higher-than-expected fiscal fourth-quarter profit Wednesday as it sold more ice cream and paid less for ingredients.

The Oakland-based company, which has agreed to be acquired by longtime investor Nestle’s Glendale-based Nestle Holdings division, said it earned $5.7 million, or 15 cents a share, in the period ended Dec. 28, compared with $172,000, or break-even, a year ago.

The company’s sales rose 7.4% in the quarter to $295.1 million, led by an 11% increase in sales of ice cream it distributes for others, such as Unilever’s Ben & Jerry’s brand. Sales of Dreyer’s own branded ice creams, which include Dreyer’s and Dreamery, were up 5%.

Much of the quarter’s pretax profit gain was due to $7 million in savings on dairy ingredients as prices plunged in the period compared with a year earlier. Dreyer’s was expected to earn 13 cents a share, the average estimate of three analysts surveyed by Thomson First Call.

The company did not issue any financial guidance for the current period or fiscal year, as Dreyer’s shareholders are scheduled to vote on its acquisition by Nestle on March 20.

The companies have not yet received clearance from the Federal Trade Commission to complete the deal. Dreyer’s said Tuesday that it would not close the transaction before March 31.

Analysts say the companies may have to sell some brands to get regulatory approval.

Dreyer’s share fell 44 cents to $71.90 on Nasdaq.