Despite production challenges, Ingredion income rises

WESTCHESTER, ILL. — Clean label ingredients and GLP-1 medication users looking to increase protein intake lifted financial results for Ingredion, Inc. in the fiscal year ended Dec. 31, 2025. Dragging down results were continuing production challenges at an Argo facility near Chicago.

Net income rose 13% to $729 million, equal to $11.36 per share on the common stock, from $647 million, or $9.88 per share, in the previous fiscal year. Net sales declined 3% to $7.22 billion from $7.43 billion. Driving the decrease were $144 million in lower/price mix and $75 million in lower volume, which was offset partially by $8 million of favorable foreign exchange, said James Gray, chief financial officer.

“Despite unforeseen challenges throughout the year, we are pleased to share that we delivered record full-year operating income and earnings-per-share growth driven by continued strength in Texture & Healthful Solutions and solid results from our Food and Industrial Ingredients LatAm business,” said James P. Zallie, president and chief executive officer, in a Feb. 3 earnings call.

In Texture & Healthful Solutions, net sales rose 1% to $2.40 billion from $2.37 billion. Operating income increased 16% to $405 million from $350 million. Clean label ingredient volumes grew significantly across Asia Pacific, the United States and Canada, Zallie said.

“Clean label remains one of the food industry’s fastest-growing areas, emphasizing its critical role in meeting consumers’ preference for authentic ingredients and simple food labels,” he said. “Ingredion continues to be a leader in the clean label texturizing space due to the breadth and strength of its portfolio, which is supported by proprietary technology, patents, consumer insights and years of formulating expertise.”

Zallie during the earnings call was asked about the impact of GLP-1 medications.

“It’s no doubt having some sort of an impact, but what I can tell you on a positive note is in relationship to our protein fortification business, which we haven’t talked about in a number of quarters, but we decided to obviously emphasize the full-year performance of the double-digit increase in sales that we saw with revenue growing 40%,” he said.

Argo’s impact

In Food & Industrial Ingredients — US/Canada, net sales declined 7% to $2.01 billion from $2.16 billion. Operating income plunged 16% to $315 million from $373 million. The production challenges at the Argo facility limited the company’s ability to produce inventory available for sale, Zallie said. The Argo situation had a negative impact of approximately $40 million on operating income for the fiscal year.

“Operational issues at our Argo facility stubbornly persisted throughout the fourth quarter,” Zallie said. “Despite being encouraged by a strong September, we experienced intermittent grind shutdowns, which resulted in higher maintenance costs, lower yields and fixed cost absorption, which reduced both our saleable finished product inventory and our co-product valorization. Furthermore, industry volume demand for sweeteners was down throughout the second half.”

Argo costs will impact the first quarter of 2026, “but we will probably get back some of the Argo one-time impacts in the back half of 2026,” Zallie said.

Production challenges at an Argo facility had a negative impact of approximately $40 million on operating income for the fiscal year.

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Volatility in Latin America

In Food & Industrial Ingredients — Latin America, net sales slipped 4% to $2.34 billion from $2.45 billion. Operating incoming increased 2% to $493 million from $483 million.

“Against a backdrop of regional, economic and political volatility throughout the year, our team managed to deliver record operating income and margins of greater than 21% for the year, up 140 basis points,” Zallie said. “Mexico specifically demonstrated resilience to offset challenging unforeseen economic conditions, delivering another record year of operating income.”

In the fourth quarter companywide, net income increased 74% to $165 million, or $2.56 per share, from $95 million, or $1.43 per share, in the same time of the previous year. Net sales slipped 2% to $1.76 billion from $1.80 billion.

Westchester-based Ingredion in fiscal year 2026 expects reported and adjusted EPS in the range of $11 to $11.80 and net sales to increase by low-single-digit percentages to mid-single-digit percentages.