UPDATE 1-Dean Foods suffers as competition mounts
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Aug 8 (Reuters) - Top U.S. dairy company Dean Foods Co reported a second-quarter loss in the face of stiff competition and warned that its current quarter would be the most challenging of the year, sending its shares down 4 percent in premarket trade.
Dallas-based Dean, known for its Meadow Gold and Dean's milk, said it expects third-quarter adjusted profit between 5 and 8 cents per share, below the average estimate from analysts of 11 cents per share, according to Thomson Reuters I/B/E/S.
Dean, which also trimmed its full-year profit forecast, said in February it expected a low-single digit percentage decline in 2013 milk volumes as a significant customer opted to buy milk from a cheaper rival. The company did not identify the customer.
It said it now expects full-year adjusted earnings between 47 cents and 53 cents per share.
Dean Foods says it is the largest processor and distributor of milk in the country and about five times the size of its next largest competitor.
It reported a net loss of $56.9 million, or 30 cents per share, on an attributable basis for the quarter ended June, compared with a profit of $56.2 million, or 30 cents per share, a year earlier.
On an adjusted basis, Dean Foods earned 13 cents per share from continuing operations. Analysts on average were expecting profit of 14 cents per share on revenue of 2.25 billion.
Dean Foods' fluid milk volumes fell 6 percent in the quarter while industry fluid milk volumes declined about 2.1 percent.
It said its share of U.S. fluid milk sales volume declined to 36.4 percent during the second quarter from 37.8 percent in the first quarter of 2013.
Revenue was flat at $2.2 billion.
Dean Foods sold Morningstar, which sells coffee creamers, ice cream mixes and other dairy products, to Canadian dairy products maker Saputo Inc in January.
The company recently disposed of the last of its stake in WhiteWave Foods Co, which owns brands such as Silk soy milk, International Delight and Land O Lakes coffee creamers.
(Reporting by Aditi Shrivastava in Bangalore; Editing by Sriraj Kalluvila and Rodney Joyce)