Dean Foods Profit Rises 9.5%; Plants to Be Shut

Dean Foods Co., the country’s largest dairy producer, Tuesday posted a 9.5% rise in first-quarter profit but said it would close more plants because of rising raw-milk and commodity costs.

The Dallas-based company, which also sells juice and water, had net income of $69.2 million, or 43 cents a share, in the latest quarter. In the first quarter last year, it earned $63.2 million, or 43 cents a share.

The latest quarter included costs of $7.6 million for the closing of three plants, compared with a gain of $1.7 million a year ago.

Excluding one-time items, Dean earned $73.9 million, or 45 cents a share, matching the estimates of analysts surveyed by Thomson First Call.

Sales rose 14% in the quarter to $2.45 billion.

Dean attributed the first-quarter profit rise partly to the acquisitions of Horizon Organic and Ross Swiss Dairies this year and Melody Farms and Kohler Mix Specialties last year.

Shares of Dean rose $1.14, or 3.4%, to $34.15 on the New York Stock Exchange.

Dean will close eight to 10 plants this year, more than it first expected, it said.

During the latest quarter, Dean closed one dairy plant in South Gate and targeted five others for closing, as it moved to lower costs. The five plants slated to be closed are in Madison, Wis., San Leandro, Calif., Lansing, Mich., Sulphur Springs, Texas, and Wilkesboro, N.C.