ATCHISON, Kan. - MGP Ingredients , Inc. (NASDAQ:MGPI) saw its shares plummet 21.48% after the distilled spirits and food ingredient solutions provider reported preliminary third quarter results below expectations and cut its full-year outlook.
The company expects Q3 sales to decline 24% YoY to $161.5 million, with adjusted earnings per share falling 5% to $1.29. Analysts had forecast EPS of $1.44 on revenue of $186.33 million.
MGP cited soft alcohol spirits category trends and elevated industry-wide whiskey inventories as key factors pressuring its brown goods business, particularly impacting smaller craft customers. Distilling Solutions segment sales are projected to drop 36%, including a 22% decline in brown goods.
"We are disappointed with our third quarter results and fourth quarter outlook," said CEO David Bratcher. "We expect these industry headwinds to persist at least through the rest of the year."
For 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 near-term challenges, Bratcher expressed confidence in the company's long-term growth prospects, noting that MGP's "pivot to becoming a branded spirits company continues to gain strength."
MGP will report full Q3 results on October 31.
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