Dean Foods Company Lowers 2007 Guidance

DALLAS, June 12 /PRNewswire-FirstCall/ -- In conjunction with the Company's presentation at an investor conference in Paris today, Dean Foods Company lowered expectations for adjusted earnings in 2007.

"We are faced with an unusually broad set of challenges across the portfolio," said Gregg Engles, Chairman and CEO. "First, conventional milk prices have risen rapidly and forecasts for the back half of the year have increased significantly as foreign and domestic market forces have combined to put significant pressure on the U.S. dairy industry. As a result, it has become increasingly likely that conventional raw milk prices will reach all- time highs by the third quarter. We expect this steep rise in dairy costs to put pressure on Dairy Group profit growth, especially in the second and third quarter."

"Second, as we've mentioned before, our Horizon Organic brand is facing a significant near-term industry-wide oversupply of raw organic milk. This oversupply is largely due to a change in the regulations governing the organic transition and certification process that caused many farmers to enter the one-year transition process prior to the new regulation taking effect in June 2006. The resulting oversupply of milk is creating a considerable disruption in the organic milk market as competitors compete aggressively to expand sales and distribution. Our WhiteWave team is responding with an aggressive program to protect Horizon Organic's leadership position through this period. This program includes lowering prices in response to competitor actions, pursuing expanded distribution, increasing our advertising support and continuing to drive innovation to maximize the long-term potential of the brand. We expect these investments to negatively impact near-term profitability."

"Based on these unprecedented challenges across the Dean Foods portfolio, we have reduced our full year expectations for adjusted earnings to approximately $1.52 to $1.58 per share. For the second quarter, we are reducing our earnings expectations to $0.30 to $0.31 per share, largely due to Dairy Group performance. We expect the third quarter to be particularly challenging as we face steep month-over-month increases in conventional raw milk costs, with an improvement in trend in the fourth quarter. We expect to provide an update in early August on our second quarter earnings conference call."

Engles concluded, "While 2007 will be behind our financial expectations, our multiple-year transformation program to reduce costs and build capability in marketing, innovation and sales continues to move forward. As we look ahead to 2008, I expect our profit growth to accelerate based on the progress we are making in building the New Dean Foods, and as the short-term challenges across the portfolio moderate."

PRESENTATION WEBCAST

Today's conference presentation is available via webcast from the Company's website. The presentation will be held at 11:15 a.m. local time (5:15 a.m. EDT) in Paris today and may be heard live by visiting the "Webcasts" section of the Company site at http://www.deanfoods.com/. A replay of the presentation will also be available at the Company's website.

ABOUT DEAN FOODS

Dean Foods Company is one of the leading food and beverage companies in the United States. Its Dairy Group division is the largest processor and distributor of milk and other dairy products in the country, with products sold under more than 50 familiar local and regional brands and a wide array of private labels. The Company's WhiteWave Foods subsidiary markets and sells a variety of well-known dairy and dairy-related products, such as Silk(R) soymilk, Horizon Organic(R) milk and other dairy products and International Delight(R) coffee creamers. WhiteWave Foods' Rachel's Organic(R) brand is the largest organic milk brand and third largest organic yogurt brand in the United Kingdom.

FORWARD-LOOKING STATEMENTS

Some of the statements in this press release are "forward-looking" and are made pursuant to the safe harbor provision of the Securities Litigation Reform Act of 1995. These "forward-looking" statements include statements relating to, among other things, current and expected organic milk supply, conventional milk costs, projected sales, operating income, net income and earnings per share. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release. The Company's ability to meet targeted financial and operating results, including targeted sales, operating income, net income and earnings per share depends on a variety of economic, competitive and governmental factors, including organic milk supply, conventional milk prices and other raw material availability and costs, the demand for the company's products, many of which are beyond the Company's control and which are described 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 the Company's products. The forward-looking statements in this press release speak only as of the date of this release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.