MGP Ingredients 2025 Q2 Earnings Misses Targets as Net Income Drops 54.9%

MGP Ingredients reported a disappointing fiscal 2025 Q2 performance, with revenue and net income both showing significant declines. The company's earnings missed expectations, as net income decreased by 54.9% year-over-year. Despite these setbacks, MGP Ingredients remains optimistic about its future, reaffirming its full-year guidance. The company projects consolidated sales for fiscal 2025 to be between $520 million and $540 million, with adjusted EBITDA expected to range from $105 million to $115 million. This guidance is in line with previous forecasts.

Revenue

MGP Ingredients experienced a 23.7% decline in total revenue, falling to $145.49 million in Q2 2025 from $190.81 million in Q2 2024, due to decreased sales in its Distilling Solutions segment.

Earnings/Net Income

MGP Ingredients' EPS dropped 53.1% to $0.67, down from $1.43 in 2024 Q2, while net income fell to $14.43 million, a 54.9% decline from $32.02 million in 2024 Q2. The EPS results indicate financial challenges.

Price Action

The stock price of MGP Ingredients has dropped 5.97% during the latest trading day, has tumbled 10.70% during the most recent full trading week, and has dropped 5.64% month-to-date.

Post-Earnings Price Action Review

The strategy of investing in MGP Ingredients shares following a quarter-over-quarter revenue increase has not proven successful over the past three years. Specifically, this approach has resulted in a negative return of -21.51%, which falls significantly short of the benchmark return of 85.57%. The excess return stands at -107.08%, and the compound annual growth rate (CAGR) of the strategy is -4.76%. These figures suggest notable losses and a lack of growth, indicating that this investment strategy has underperformed considerably compared to broader market trends.

CEO Commentary

"I am excited to take on the CEO role and look forward to building on the progress made by Brandon and the MGP team," said Julie Francis, CEO. She emphasized the commitment to delivering sustainable growth and unlocking long-term value for stakeholders. The company is focused on strengthening its customer-centric, brands-led approach while executing with excellence. Challenges included expected declines in brown goods sales and profitability pressures, yet the leadership remains optimistic about positioning the company for the second half of 2025 through strategic initiatives and improved market visibility.

Guidance

MGP Ingredients projects consolidated sales for fiscal 2025 to be in the range of $520 million to $540 million. The company expects adjusted EBITDA between $105 million and $115 million, reaffirming confidence in its strategic priorities and long-term vision despite recent performance challenges.

Additional News

In recent developments, MGP Ingredients announced the appointment of Julie Francis as its new Chief Executive Officer on July 21, 2025. She brings a wealth of experience from her previous roles at Constellation Brands and Coca-Cola and is expected to drive the company’s strategic initiatives forward. Additionally, the company declared a quarterly dividend of $0.12 on July 31, 2025, continuing its commitment to returning value to shareholders. Lastly, on May 27, 2025, MGP Ingredients announced changes in its board leadership, reflecting an ongoing effort to strengthen its governance and strategic focus. These changes come as the company focuses on enhancing its growth and innovation strategies.