MGPI struggles continue as quarterly loss tops $134 million

ATCHISON, KAN. — For the second straight quarter, MGP Ingredients, Inc. suffered a substantial loss as the company followed up a loss of $132.99 million in the fourth quarter of fiscal 2025 with a loss of $134.84 million in the first quarter of fiscal 2026. Both quarters included significant charges related to goodwill and indefinite-lived intangible asset impairments, but company executives also noted struggles navigating a challenging industry environment.

MGPI’s loss of $134.84 million in the first quarter ended March 31 compared with a loss of $2.99 million in the same period a year ago.

Adjusted EBITDA in the quarter was $15.01 million, down 31% from $21.76 million a year ago. Sales also were lower year over year, falling 13% to $106.43 million from $121.65 million.

“In the first quarter, we continue to focus our energy on the areas we can control and to sharpen our strategic focus and strengthen execution across the organization,” Julie Francis, president and chief executive officer, said in an April 29 conference call with analysts.

Challenges were noted in both the company’s Distilling Solutions segment (gross profit down 54%) and Branded Spirits segment (gross profit down 5%). MGPI recently detailed plans to temporarily idle distilling operations at its Limestone Branch Distillery in Lebanon, Ky., and Lux Row Distillers in Bardstown, Ky., as the company adjusts production levels to align with its current inventory levels.

A bright spot for MGPI during the first quarter was its Ingredient Solutions segment, which posted a 56% increase in gross profit. At $3.82 million, gross profit in the segment was up from $2.45 million in the same period a year ago. Ingredient Solutions segment sales also were stronger, climbing 29% to $34.2 million, primarily driven by higher sales volume and price/mix of specialty wheat proteins and starches, MGPI said.

“This successful first quarter was driven by continued improvements in operational reliability with each month better than the past one,” Francis said. “For the quarter, efficiency was up 14% year over year with a slower start to the year firmly offset by a solid March. We plan to continue to move toward greater efficiency as we improve overall and as we begin to cycle previous throughput issues. Effluent disposal has been more complex and more costly than initially projected. Reducing waste and disposal costs are key priorities, and we’re implementing additional measures by year-end and continue to expect to remove these costs over the long term.

“At the end of the second quarter and into the third, we have a planned shutdown for scheduled maintenance and capital projects designed to further improve reliability and throughput and to provide some relief in our waste stream disposal costs. … Despite the effluent challenge, we are moving in the right direction in Ingredient Solutions. We are pleased with the momentum as better operational reliability means we have more product to sell. And this is key as we continue to see increasing demand for our proprietary and unique products. We will remain focused on driving growth through our specialty fiber, Fibersym, our specialty protein, Arise, and our extrusion protein, ProTerra.”

MGPI reaffirmed its guidance for fiscal 2026, with adjusted EBITDA expected to be between $90 million to $98 million and sales projected to be in the range of $480 million to $500 million.