DF Dean Foods Company New

Dean Foods Co. swung to a profit in its first quarter as lower milk prices continued to boost results.

Earnings topped Wall Street expectations, and the company offered upbeat guidance for the current quarter.

Dallas-based Dean Foods has been aiming to shift more of its business toward branded milk and ice cream products that command higher profits, at a time when alternatives like almond and soy milk have cut into sales of traditional cow's milk.

Still, lower raw milk prices have helped the company's results in recent quarters, working to offset declining volumes. In the most recent quarter, raw milk costs fell 14% from the same quarter a year ago. Volume declined 3.2% and the company lost market share on both a sequential and year-over-year basis.

In March, Dean Foods said it didn't expect a planned Wal-Mart Stores Inc. dairy processing plant in Indiana to have a material effect on its financial results but that it estimates the plant will result in the loss of roughly 100 million gallons of low-margin, private-table fluid milk volume beginning late next year.

Chief Executive Gregg Tanner said in a news release Tuesday that the company expects low single-digit volume declines and slightly decreasing raw milk costs in the second quarter, resulting in earnings per share between 32 cents and 40 cents. Analysts polled by Thomson Reuters had expected 34 cents a share.

In all for the quarter, Dean Foods reported a profit of $39 million, or 43 cents a share, compared with a loss of $74 million, or 78 cents a share, a year earlier. Excluding certain items, earnings rose to 45 cents from 24 cents a share.

Revenue declined 8.4% to $1.88 billion.

Analysts projected 38 cents in per-share profit and $1.89 billion in revenue, according to Thomson Reuters.

Shares in the company, down 9% in the past three months, were inactive in premarket trading.

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

May 10, 2016 08:55 ET (12:55 GMT)

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