MGP Ingredients shares fall 21% on weak first Q3 results, guidance downgraded By Investing.com
ATCHISON, Kan. – Ingredients of MGP Inc. (NASDAQ: ) saw its shares fall 21.48% after the distilled spirits and food supplements solutions provider reported lower-than-expected first-quarter results and cut its full-year outlook.
The company expects Q3 sales to fall 24% YoY to $161.5 million, with adjusted earnings per share down 5% to $1.29. Analysts had forecast EPS of $1.44 on revenue of $186.33 million.
MGP cited trends in the soft spirits category and whiskey highs across the industry as key factors weighing on its brown goods business, which mainly affects younger customers. Distilling Solutions segment sales are expected to decline 36%, including a 22% decline in brown goods.
“We are disappointed with our third quarter results and the outlook for the fourth quarter,” said CEO David Bratcher. “We expect these industry headwinds to continue for at least a year.”
For the full year 2024, MGP now expects sales of $695-$705 million, down from its previous guidance of $742-$756 million. The company also lowered its adjusted EBITDA forecast to $196-$200 million from $218-$222 million previously.
Despite the near-term challenges, Bratcher expressed confidence in the company’s long-term growth, noting that “MGP’s pivot to being a branded spirits company continues to gain momentum.”
MGP will report full Q3 results on October 31.
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