Dean Foods Company -...

Dean Foods CompanyConsumer Analyst Group

of New YorkAnnual Conference

February 21, 2007

Forward Looking Statements

The following statements made in this presentation are “forward looking” and are made pursuant to the safe harbor provision of the Securities Litigation Reform Act of 1995: statements relating to (1) projected sales (including for individual segments, for specific product lines and for the company as a whole), profit margins, net income and earnings per share, (2) our growth strategy, (3) our branding initiatives (4) our integration plans, and (5) our cost-savings initiatives. These statements involve risks and uncertainties that may cause results to differ materially from those set forth in this presentation. Financial projections are based on a number of assumptions. Actual results could be materially different than projected if those assumptions are erroneous. Sales, profit margins, net income and earnings per share can vary based on a variety of economic, governmental and competitive factors, all of which are identified in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10K (which can be accessed on our website at www.deanfoods.com or the website of the Securities and Exchange Commission at www.sec.gov). The success of our branding initiatives will depend on a number of factors, including customer and consumer acceptance of both the products themselves and the prices that we intend to charge for those products. We have many competitors with greater resources than ours, and significant additional spending or innovations by our competitors could render our products less successful than we currently expect. All forward looking statements in this presentation speak only as of the date of this presentation. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in our expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.

AgendaGregg Engles

Joe Scalzo

Jack Callahan

Gregg Engles

The New Dean

WhiteWave

Dairy Group

Summary and Outlook

Dean Foods Is the Only National DairyBeverage Company

Leading portfolio of national and regional dairy brands in better-for-you beverage categories

National manufacturing system with fullest set of capabilities and with market proximity as a strategic advantage

Unparalleled refrigerated distribution network

Deep customer relationships at local, regional and national levels across all channels

Ability to innovate across the entire dairy category

Experienced management team with deep company, dairy and CPG industry expertise

Strong RegionalBrands

Strong Branded PositionComplemented by Private Label…

National BrandsPrivateLabel

33% BrandedSales

67%

Dean Foods 2006Sales Mix

…With the Country’s OnlyNational Manufacturing System…

...Delivered Through the Most Extensive NationalRefrigerated Sales and Distribution Network

160,000 refrigerated locations served6,500 DSD routes nationwide2,600 tractors4,400 straight trucks5,300 refrigerated trailers

Broad grocery and retail capability, including natural foods channelExtensive foodservice / QSR system

Any customer, any channel

WarehouseDSD

WhiteWave Foods

Dean Foods: 2006 Scorecard

Dairy Group

Leverage: share repurchaseand/or debt paydown

Corporate Costs

Operating Profits

Earnings Per Share Growth*

Mid-single digits(5-6%)

Mid-teens (15-18%)

Less than volume growth (2-3%)

High-single digits(7-8%)

+++

Double-digit EPS Growth

*excludes restructuring and other one-time items

Long-term Algorithm 2006 Result

+6%

+21%

(2.4%)

+9%

+++

+16%

Historical EPS Growth

2002 - 2006CAGR = 17%

$1.15

$1.31

$1.48

$1.83

$2.12

2002 2003 2004 2005 2006GAAP EPSfrom continuing operations

$1.08 $1.53 $1.28 $1.67 $2.01

See reconciliation of these at www.deanfoods.com and in Appendix A of this presentation*Adjusted to omit the net impact of facility closing costs and one time charges and discontinued operations.

Adj

uste

d EP

S*

http://www.deanfoods.com/

Consistent Operating Incomeand Stable Cash Flow Generation

Operating Income fromContinuing Operations*

Cash Flow fromContinuing Operations

* Excludes divestures and non-recurring items, See Appendix A for reconciliation

Capex: $260 $301 $287 $237FCF: $125 $113 $255 $323

GAAPOp. Inc.

$574 $536 $580 $651

($ millions)($ millions)

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

Focus on Sustained ShareholderValue Creation

Acquired Morningstar

Acquired Dean Foods

AcquiredWhite Wave

Acquired 100% ofHorizon Organic

Began WhiteWaveconsolidation

TreeHouseSpin-off

Source: Bloomberg as of 2/16/2007Note: Share price appreciation reflects stock-split adjusted price.

Added toS&P 500 Index

Acquired Southern Foods

IPO

Acquired minority interest in

Horizon Organic

CAGR = 26%Announced sale of Iberian operations

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 YTD

Dean Foods Evolution

Shifting volume to more efficient facilities, elimination of excess capacity

Demonstrated ability to drive market share

Significant management focus on portfolio rationalization and WhiteWave consolidation

Early steps towards developing the future Dairy Group operating model

75 fold US dairy revenue growth from 1994 to 2002

– $100 million to$7.6 billion

Expanded from 2 facilities to over 100

Developed only nationwide footprint in the industry

Four times larger than nearest competitor

Primary focus on rollup, limited change to local dairy operating model

Consolidation

1994 - 2001

Transition

2002 - 2006

Traditional Dairy

Fragmented industry

Local companies

Locally managed, lack of functional expertise

Limited profitability and financial resources

Infrequent innovation

Limited marketing

High private label penetration

New Dairy

Consolidated industrySingle national player –Dean Foods is the #1 health & wellness and #3 non-alcoholic beverage company in U.S.Growing profitability; resources to investInvestment in innovationand marketingEmergence of national brandsStrong regional brandsGreater consumer focus on nutrition

Dairy Category Still Has Tremendous Upside

Evolve the operating model to maximize the benefits of scale advantage

Strengthen functional expertise to:

– Sustain year on year productivity

– Enhance selling capability, brand building and innovation

Ensure pace of change does not inhibit business performance

Opportunity to sustain strong operating profit growth

The New Dean

2007 - 2010

Shifting volume to more efficient facilities, elimination of excess capacity

Demonstrated ability to drive market share

Significant management focus on portfolio rationalization and WhiteWave consolidation

Early steps towards developing the future operating model

75 fold US dairy revenue growth from 1994 to 2002

– $100 million to$7.6 billion

Expanded from 2 facilities to over 100

Developed only nationwide footprint in the industry

Four times larger than nearest competitor

Primary focus on rollup, limited change to local dairy operating model

Consolidation

1994 - 2001

Transition

2002 - 2006

Dean Foods Evolution

The New Dean FoodsThe New Dean Foods

Building the New Dairy Model

Stepped Up Brand Building

and Innovation

Strengthened Selling

Systems

Increased Productivity

Step-Up Brand

Building And

Innovation

Strengthen Selling

Systems

Increase Productivity

WhiteWave Foods

Three separate businesses– Overlapping organizations– Significant redundancy– Variety of systems

Complex and inefficient manufacturing and distribution

– Over 12 internal production sites

– 30+ co-packersLimited selling and marketing capability

Starting Point: 2004 Where We Are Today: 2007

Consolidated and integrated three businesses into one

– Single face to the customer

– Reduced redundancy– Leveraged scale

Implementing SAP for efficiency and business insightBuilding direct sales model, company-wide innovation center, and world-class marketing organization

Update From Joe Scalzo, CEO and President, WhiteWave Foods

Dairy Group

Highly decentralized– 57 Business Units– 139 P&L’s

Limited scale leverage– Some plant

rationalization– Cooperation on some

direct materialsSignificant redundancyMixed functional expertise

Starting Point: 2005 Where We Are Today: 2007

Moving forward on a multi-year productivity enhancement program– Purchasing– Administration– Manufacturing

Shifting operating model to balance national scale with local accountabilityLooking to build expertise in marketing and DSD over time

Update From Jack CallahanCFO, Dean Foods

AgendaGregg Engles

Joe Scalzo

Jack Callahan

Gregg Engles

The New Dean

WhiteWave

Dairy Group

Summary and Outlook

WhiteWave Foods: Overview

Strong portfolio of branded products Leading market shares in on-trend categories- Horizon: #1 organic milk (45% share)- Silk: #1 soy milk (75% share)

Significant recent investment in capabilities and infrastructure

2006 PerformanceSales: $1,278MOperating Income: $139M, +21%

Core Brands

Brand Mix

Transition to a Unified WhiteWave Business is Near Complete; Margin Expansion Along the Way

2004

Three separate,

legacy companies

2006 2008+

Transition to one

integrated business

2005

Sust

aina

ble

grow

than

d su

perio

r ret

urns

2007

The New WhiteWave:

Increase productivityStrengthen selling systemsStep-up brand building and innovation

~2008+Top-tier CPGperformance

Net sales:Op mgn (%): 8.4% 9.6% 10.9%

$1,042M $1,201M $1,278M2004 2005 2006


and Innovation


Systems


Step-Up Brand

Building And

Innovation

Strengthen Selling

Systems



Leveraged, integrated supply chainEfficient

ManufacturingOptimized

Distribution

FocusedProductPortfolio

2007 and

beyond

UnfocusedPortfolio

2,600 SKU’sManufactured

Under-leveragedManufacturing

12 CompanyOwned Plants and

30+ Co-packers

ComplexDistribution

65InventoryLocations

2004

Reduceproduct

movement, maximize

truck loads

Drive top products

(~700 SKUs)

In-house production(5 plants,

3 strategicco-packers)

2005 -2006

Increase Productivity: Supply Chain

Increase Productivity: Purchasing

2005 – 2006:– Organized a centralized procurement

organization– Leveraged combined spend of 3 legacy

WWF businesses

2007 and 2008:– Leverages common areas of spend

across Dean Foods– Standardizing specifications

Increase Productivity: SAP

2006: Significant portion of business migrated- 50% of products and customers- Two plants

2007: Migrate rest of business

2008 and beyond: - Leverage improved enterprise

planning, visibility and control- KPI-measured performance

improvement



and Innovation


Systems


Step-UpBrand

BuildingAnd

Innovation

Strengthen Selling

Systems


Strengthen Selling Systems

2005 – 2006: Transitioned to one sales organization primarily brokered through Acosta

2007 – 2008:–Transition to hybrid direct sales model with dedicated sales and distribution teams for key customers

– Leverage Dairy Group DSDSingle ServeAlternative Channels



and Innovation


Systems


Step-UpBrand

Building And

Innovation

Strengthen Selling

Systems


Step-Up Branding and Innovation

2005 – 2006: Improve marketing to drive continued core brand growth– Build the team with top CPG marketing talent– Consumer insight and ROI-driven programs

2007 – 2008: Invest to accelerate growth through innovation

– Focus on prospects– New products– New channels– New geographies

New ProductsValue-addedLine Extensions

Single ServeExpansion

Step-Up Branding and Innovation: 2007

Single ServeExpansion

Value-addedLine Extensions New Products

Strategic Summary

Core Brand Overview

• 2006 Brand Sales: ~$360MM

• 12% increase vs 2005

• 75% market share1

No. 1 soy beverage

Compelling health benefits

Significant growth potential by targeting consumer prospects:

– Only 11.5% HH penetration(up 1% point from year ago)2

– Soymilk households consume three times as much conventional milk as soymilk3

Driving cost from the supply chain through scale and efficiencies

Investing in innovation

1. IRI, Spins, IRI Wal-Mart panel data2. IRI Household Panel.3. Cambridge Group – Demand Landscape March 2006.

Strategic Summary

Strategic Summary

Core Brand Overview

• 2006 Brand Sales: ~$315MM

• 24% Milk Increase vs 2005

• 45% market share1

Continue to focus on supply growth

– 25%+ organic milk supply increase in 2007 (vs. year ago)2

Significant growth potential from penetrating consumer prospects

– ~4% household penetration vs. 33% of households interested in organic milk 3

Demand-driving initiativesunder way– New Products– Distribution– Single Serve

1. IRI, Spins, IRI Wal-Mart panel data2.Company estimates3.Cambridge Group – Demand Landscape March 2006.

Strategic Summary

Core Brand Overview

2006 sales growth of 7%30% market share in retail (#2)#1 in foodservice(approx 80% share)

2006 sales growth of 6%20% market share – all-time high (half and half creamer)Exclusive perpetual fluid dairy license

2006 sales growth of 27%#1 UK organic milk brand#2 UK organic yogurtIntroduce brand to U.S.

WhiteWave Summary

Transitioning to one integrated business; will be completed in 2007

Strong core brand growth

Steadily improving operating margins

On our way to the New WhiteWave

AgendaGregg Engles

Joe Scalzo

Jack Callahan

Gregg Engles

The New Dean

WhiteWave

Dairy Group

Summary and Outlook

#1 processor and distributor of milk and dairy products in the U.S.Leading portfolio of well-known regional brands, with private label offeringsBroad customer reach and strong relationshipsUnparalleled refrigerated U.S. distribution network

2006 PerformanceSales: $8,821MOperating Income: $678M, +6%

Dean Dairy Group: Overview

Representative Brands

Product Mix


and Innovation


Systems


Step-UpBrand

Building And

Innovation

Strengthen Selling

Systems



Significant Compressible Cost Opportunity

Traditional P&L View: Dairy Group

20%

80%

40%

60%

100%

COGS

0%

2006 Cost Base = $8.14 B Estimate

COGS

OperatingExpense


Alternative P&LView

20%

80%

40%

60%

100%

COGS

Milk/Cream

40%

0%

2006 Cost Base = $8.14 B Estimate

COGS

OperatingExpense



Alternative P&LView

20%

80%

40%

60%

100%

Direct Materials 20%

COGS

OperatingExpense

Milk/Cream

40%

0%

2006 Cost Base = $8.14 B

People Related22%

Capital 2%

Other 4%

Indirect Purchases12%

Compressible Costs ~$5B

Estimate


Purchasing: Starting Point

Category management

Majority of category spend unmanagedPrimarily price focused vs. total cost of ownership/system cost emphasis

Compliance

Limited plant compliance with local buying Limited ability to track performance metrics

Organization

Understaffed organizationBuyer roles combined strategic sourcing with execution

Purchasing: The Opportunity

Ingredients / Commodities*

Packaging

Other

Utilities

MRO

Logistics

Direct Materials Indirect Purchases$1.1B$1.9B

Other

*Notes: Ingredients/ commodities does not include raw milk, cream or soybeans: 2005 cost base Source: Internal data, including Dairy Group, and WWF

Includes both Dean Dairy Group & WhiteWave

Purchasing: Where We Are Today

Foundational Work Complete in 2006

Category management

Detailed understanding of total spendLeverage competitive bidding to drive resultsSet high expectations of our suppliers

Compliance

Measure performance against expectationsEnsure compliance

Organization

New experienced leadership in placeEstablishing a disciplined sourcing process

Purchasing: Prioritized Into Multiple Waves

Low

Low

High

$ I

mp

act

Ease of implementationHigh

Delivering Net Benefits in 2007 - Several Years of Benefits Expected

Wave IIWave III Wave I2007- 20082008- 2009+

Administration: Starting Point

Historically local and decentralized staffingMultiple systems and organization structuresAccounting, payroll, and accounts payable at over 60 locationsOpportunity to: – Keep activities local

that need to be local– Centralize activities

that can be shared

Finance &

Accounting

HR & Payroll

Other

>2,000 people and $110 million

CurrentFocus ofinitiatives

Finance: A More Specialized, Capable Function

Shared ServicesControl & ReportingFinancial Planning and Analysis

Actual Result Orientation

Key Focus:Financial statement consistency, integrity & reportingTransitioning into three primary locations

Forward Looking Orientation

Key Focus:Influencing decision making and bottom line performanceAligned with field management structure

Efficient TransactionProcessing

Key Focus:Consistent and high quality service for our partners and employeesCreated Dean Financial Services in Dallas

Requires An Investment in 2007

Manufacturing: Continue to Drive Costs Lower

Continue optimization of the manufacturing footprintDeveloping common metrics in cooperation with the realigned Finance OrganizationImprove underperforming operations

Best practicesContinuous improvementprograms

Continued Focus

Longer-Term Development



and Innovation


Systems


Step-UpBrand

Building And

Innovation

Strengthen Selling

Systems


Working Toward a Transition from a Geographic Focus to a System Focus

Refrigerated Frozen

Selling System

Primary Product

Line

Shelf Life

Estimated Sales Mix(% of total)

DSD

Milk, Cream, Juice,

Drinks, Water

2-3 weeks

75%

Warehouse

ESL Cream, Yogurt, Cottage Cheese, Sour

Cream, Ice Cream Mix

2-3 months

15%

DSD & Warehouse

Ice Cream, Novelties

9-12 months

10%

Selling Systems: Uniquely Positioned to Leverage Size and Scale

Leveraging DSD, warehouse and frozen distribution to offer full category management

Flexibility to meet the diverse needs of national, regional and local retail and foodservice customersPrivate label offering builds close working relationships with key customers, in addition to scale leverageInvesting in technology to further improve customer services, eg: ASN, UCCNet

Brand Building: Regional Dairy Brands

Investing to strengthen Marketing leadership and capability

Alan Bernon

Harrald KroekerDairy DSD

John RobinsonMorningstar/ Warehouse

Extensive Dairy, Beverage and Functional Expertise

TBDIce Cream / Frozen

Functional Staff

Business Unit

LeadershipDairy: 25 yrsDean: 8 yrs

Dairy: 31 yrsDean: 10 yrs

CPG: 26 yrsPBG: 20 yrs

Years Of Experience•Dairy 98 •Dean 44•Beverage 22•HR 22•Finance 25•Purchasing 30

Dairy Group 2007 Algorithm

$678 M

$642 M

$597 M

Volume/ Mix

+2%Productivity

+2%+2% -1%

PurchasingInvestments

2004 2005 2006 2007 E

2 Year CAGR = 6.6%

~ +5%

AgendaGregg Engles

Joe Scalzo

Jack Callahan

Gregg Engles

The New Dean

WhiteWave

Dairy Group

Summary and Outlook

The New Dean FoodsThe New Dean Foods



and Innovation


Systems


Step-UpBrand

Building And

Innovation

Strengthen Selling

Systems


WhiteWave Foods

Dean Foods Sustainable Growth Algorithm

Dairy Group

Leverage from share repurchase and/or debt paydown

Corporate Costs

Operating Profits

Earnings Per Share Growth*

Mid-single digits(5-6%)

Mid-teens (15-18%)

Less than volume growth (2-3%)

High-single digits(7-8%)

+++

Double-digit EPS Growth

*excludes any future restructuring or other one-time items

2007 Outlook

Operating profit: ~7% growth

EPS: $2.33 - $2.3810% - 12% growth

Capital Expenditures: ~$250 M

Q1 EPS Expectations:$0.44 - $0.4610% – 15% growth

Dean Foods CompanyConsumer Analyst Group

of New YorkAnnual Conference

February 21, 2007

Appendix A: Reconciliation

DEAN FOODS COMPANY

Reconciliation of Operating Income and Diluted EPS from Continuing Operations to Adjusted Results(Dollars in thousands, except per share data)

(Unaudited)

2002 2003 2004 2005 2006 Operating Income (GAAP): 475,906$ 573,683$ 535,745$ 580,095$ 650,695$ Facility closing and reorganization costs 19,050 11,787 24,575 35,451 25,116 Other operating (income) expense - (68,719) (5,899) 3,148 -

Operating Income (Adjusted): 494,957$ 516,751$ 554,420$ 618,694$ 675,811$

Diluted EPS from continuing operations (GAAP): 1.08$ 1.53$ 1.28$ 1.67$ 2.01$ Facility closing and reorganization costs 0.07 0.04 0.09 0.15 0.11 Settlement of tax matter (0.04) - - - - Losses on investment in affiliate 0.04 - - - - Gain on sale of frozen pre-whip topping business - (0.25) - - - Gain on litigation settlement - - (0.02) - - Write-off of deferred financing costs - - 0.13 - - Other non-recurring charges - (0.01) - 0.01 -

Diluted EPS from continuing operations (Adjusted) 1.15$ 1.31$ 1.48$ 1.83$ 2.12$

Fiscal Year Ended December 31,

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