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February 16, 2005

Dean Foods sales increased 18% in 2004...Unilever reports a 6% loss for 2004, changes management structure... Cholesterol-lowering yogurt debuts...Winn-Dixie to sell dairy operations...Dairy People News...California Bay Area supermarkets, union avoid strike repeat...Wal-Mart to close unionized store in Canada...McDonald's settles trans fat suit... Odds-and-Ends...Stock Market Ticker...More news at www.idfa.org.

DAIRY BUSINESS BRIEFS

Dean Foods Co. reports that net sales for 2004 increased 18 percent to $10.8 billion, compared with $9.2 billion during 2003. Dallas-based Dean attributes the increase to growth in the company's branded business and the Horizon Organic, Kohler Mix Specialties and Ross-Swiss Dairies acquisitions, among other things. Net income for 2004 dropped 19.7 percent to $285.4 million ($1.78 per share), compared to $355.7 million ($2.27 per share) in 2003. In 2005, Dean forecasts that sales will top $10.6 billion. For the fourth quarter of 2004, Dean's net sales totaled $2.8 billion, an increase of 11 percent over its fourth quarter 2003. Net income for the fourth quarter grew 14 percent to $98.9 million ($0.64 per diluted share) compared to $86.5 million ($0.54 per share) in the same quarter of the previous year. The Dairy Group's net sales for the fourth quarter rose 7 percent to $2.2 billion, from $2.1 billion in its fourth quarter 2003. (Company report)

Consumer goods conglomerate Unilever reported a net loss of 255 million euros ($326.6 million) for the fourth quarter of 2004, after posting profits of 730 million euros ($825 million) in the fourth quarter one year ago. Key losses included 650 million euros ($832.5 million) from its Slim-Fast subsidiary, which saw sales drop as a result of the low-carb diet boom. Sales for the quarter were 10.2 billion euros ($13.1 billion), falling from 10.5 billion euros. Total sales for 2004 were down 6 percent to 40.4 billion euros ($51.7 billion). Net profit fell 32 percent to 1.88 billion euros ($2.41 billion). Unilever, which has dual headquarters in London and Rotterdam, Netherlands, additionally announced that it will change its co-chief executive structure. Patrick Cescau will remain chief executive, while Antony Burgmans will be moved to a non-executive chairman's role. (Associated Press, Business Week Online)

Yoplait Healthy Heart yogurt, which contains cholesterol-lowering plant sterols, will roll out nationally this month. Minneapolis-based Yoplait-Colombo, a division of General Mills, reports that the product is the first yogurt containing sterols available in the United States. Clinical studies have shown that an intake of 0.8 grams of plant sterols daily can reduce LDL or "bad" cholesterol by an average of 6 percent over a period of as little as four weeks; each serving of the Heart Healthy yogurt contains 0.4 grams of sterols. The yogurt is packaged in single-serve 6-ounce cups, and is available in Strawberry, Harvest Peach, Cherry Orchard and Strawberry Banana flavors. (Company report)

Winn-Dixie Stores Inc. plans to sell its remaining dairy processing operations as well as some other manufacturing assets as part of its restructuring plan. The Jacksonville, Fla.-based retailer posted a loss of $399.7 million ($2.84 a share) for the second quarter ending Jan. 12, compared with a loss of $79.5 million (57 cents per share) in the same quarter one year ago. Second-quarter revenues were $3.08 billion, compared with $3.23 billion a year ago. (Sun-Sentinel, Fort Lauderdale, Fla.)...One bright spot for the chain is the positive publicity garnered from the release of the movie Because of Winn-Dixie. Based on a book by the same name, the movie is the story of a girl and a stray dog she finds in a Winn-Dixie store parking lot. Parts of the movie were filmed at a Winn-Dixie store in Louisiana; the retailer is helping to promote the movie by selling merchandise and copies of the books. (Florida Today)

DAIRY PEOPLE NEWS

Jay Simon has joined Stockton, Calif.-based Super Store Industries (SSI) as president. His responsibilities include the company's California dairy processing operations in Fairfield and Turlock and SSI's grocery distribution center in Lathrop. Simon has an extensive retail and logistics background. (Company report)

Perry D. Odak, former Ben & Jerry's CEO/president, will join the Friendly Ice Cream Corp.'s board of directors on March 1. Wilbraham, Mass.-based Friendly notes that Odak will succeed Charles A. Ledsinger, who resigned. Odak is currently the president and CEO of Wild Oats Markets. (Company report)

CUSTOMER CLIPS

After five months of negotiations clouded by the potential of a drawn-out strike like last year's in Southern California, union grocery workers in the California Bay Area have ratified a three-year contract with supermarkets owned by Safeway, Albertson's and Kroger. The contract covers 20,000 United Food and Commercial Workers employees in the Bay Area, extending as far north as the Oregon border; the contract also covers an additional 10,000 union grocery workers at other stores. (The San Francisco Chronicle)

In other labor news, Wal-Mart Stores Inc. plans to close its Jonquiere, Quebec, store after failing to reach a contract with the United Food and Commercial Workers union. The Jonquiere Wal-Mart and another store in St. Hyacinthe, Quebec, were the first Wal-Mart units in North America to form a union; 190 workers will be displaced as a result of the closing. (Bloomberg News)

McDonald's Corp. will pay $7 million to the American Heart Association for a public education campaign about trans fats, or partially hydrogenated vegetable oil, found in the fryers of most fast-food chains. In addition, McDonald's agreed to spend $1.5 million to publish its progress in finding an oil substitute. The funds will settle the lawsuit filed in San Francisco by attorney Stephen Joseph, president of BanTransFats.com. The Oak Brook, Ill.-based fast-food giant pledged more than two years ago that its restaurants would switch to oil that contained less trans fats. However, due to operational issues the oil was not changed. The suit alleged that the fast-food chain did not sufficiently inform the public about not switching oils. (The San Francisco Chronicle)

IDFA NEWS

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ODDS-AND-ENDS

Arden Hills, Minn.-based Land O' Lakes Inc. has reported revised 2004 net earnings of $21.4 million, up from the $20.1 million previously reported (see last week's D-Brief). The $1.3 million earnings revision was the result of a change in a tax provision. (Company report)...In other LOL news, the co-op will sell its swine operations in the Midwest in a deal to close by the end of the first quarter and expected to improve LOL's financial results. The deal with Maschhoffs Inc., an Illinois-based hog production company, includes 60,000 sows and operations in four states. (St. Paul Pioneer Press)...Russian dairy and juice business Wimm-Bill-Dann will reorganize its corporate structure and shift its agrarian business into a separate division. The restructuring will include a $10 million investment in dairy farm acquisition to ensure milk supply. (The Russian Business Monitor)...A Wausau, Wis., appeals court upheld a court ruling for $1.75 million in damages to be paid by Wisconsin Public Service Corp. to a De Pere, Wis., dairy farmer as compensation for stray voltage damaging cow milk production over the course of two decades. (Associated Press)

STOCK MARKET TICKER

As of 2/15/05, market close.

Company/Symbol		Last Trade		Change over Previous Close		Change over Last Week's D-brief
Dean Foods/DF Dreyer's/DRYR General Mills/GIS Groupe Danone/DA Hershey Foods/HSY Ingles Markets/IMKTA Kraft Foods/KFT Kroger/KR Ruddick Corp./RDK Safeway/SWY Saputo/SAP.TO Supervalu/SVU Unilever PLC/UL Weis Markets/WMK Wimm Bill Dann/WBD Winn-Dixie/WIN		34.88 80.58 52.65 18.87 62.32 13.05 33.61 17.89 24.18 19.05 36.65 32.95 38.77 37.94 16.80 01.75		+0.48 +0.12 +0.03 +0.09 +0.62 +0.00 -0.06 +0.44 +0.16 -0.04 +0.37 -0.20 -0.22 +0.04 +1.10 +0.10		+0.02 +0.11 -0.30 +0.70 +1.48 +0.00 -0.11 +0.45 +0.68 +0.08 +0.15 +0.13 -0.14 -0.11 +0.94 -1.84
Source: Yahoo! Finance

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D-brief is written by Dairy Field magazine, a Stagnito Communications Inc. publication, www.dairyfield.com. It is provided for the benefit of the industry by the International Dairy Foods Association (IDFA), www.idfa.org.

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