third quarter 2026
Filed Oct 28, 2026MGP Ingredients Reports Third Quarter 2026 Results Company reaffirms full-year 2026 guidance, declares $0.12 quarterly dividend and will become Sempreon, Inc. (Nasdaq: CASK) on November 2
Third-quarter sales, gross profit, operating income, net income and adjusted EBITDA declined from the prior year, led by lower brown goods sales in Distilling Solutions and lower international private-label sales. Ingredient Solutions grew sales and management reaffirmed full-year guidance, while net debt leverage was approximately 3.6x at September 30, 2026.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Sales, quarter ended September 30GAAP | $117.9M | – | (10) % |
| Cost of sales, quarter ended September 30GAAP | $77.45M | – | – |
| Gross profit, quarter ended September 30GAAP | $40.46M | – | (18) % |
| Gross margin, quarter ended September 30GAAP | 34.3% | – | declined approximately 350 basis points |
| Advertising and promotion expenses, quarter ended September 30GAAP | $6.41M | – | (4) % |
| Selling, general, and administrative expenses, quarter ended September 30GAAP | $21.52M | – | 14% |
| Adjusted SG&A, quarter ended September 30non-GAAP | $20.07M | – | 13% |
| Operating income, quarter ended September 30GAAP | $12.02M | – | (43) % |
| Adjusted operating income, quarter ended September 30non-GAAP | $13.98M | – | (44) % |
| Income before income taxes, quarter ended September 30GAAP | $8.94M | – | – |
| Net income, quarter ended September 30GAAP | $6.89M | – | – |
| Adjusted net income, quarter ended September 30non-GAAP | $8.57M | – | – |
| Basic earnings per common share, quarter ended September 30GAAP | $ 0.32 | – | – |
| Diluted earnings per common share, quarter ended September 30GAAP | $ 0.32 | – | – |
| Adjusted basic and diluted EPS, quarter ended September 30non-GAAP | $ 0.39 | – | – |
| Adjusted EBITDA, quarter ended September 30non-GAAP | $21.49M | – | (33) % |
| Cash flow from operations, quarter ended September 30GAAP | $32M | – | – |
| Sales, year to date ended September 30GAAP | $348.7M | – | – |
| Gross profit, year to date ended September 30GAAP | $120.5M | – | – |
| Operating income (loss), year to date ended September 30GAAP | −$143.5M | – | – |
| Adjusted operating income, year to date ended September 30non-GAAP | $41.91M | – | – |
| Net income (loss), year to date ended September 30GAAP | −$115.9M | – | – |
| Adjusted net income, year to date ended September 30non-GAAP | $27.65M | – | – |
| Basic and diluted EPS, year to date ended September 30GAAP | $ (5.41) | – | – |
| Adjusted basic and diluted EPS, year to date ended September 30non-GAAP | $ 1.29 | – | – |
| Adjusted EBITDA, year to date ended September 30non-GAAP | $64.11M | – | – |
| Net cash provided by (used in) operating activities, year to date ended September 30GAAP | −$8.86M | – | – |
| Additions to property, plant, and equipment, year to date ended September 30GAAP | −$14.88M | – | – |
| Cash and cash equivalents, September 30GAAP | $13.60M | – | – |
| Total debt, September 30, 2026non-GAAP | $341.2M | – | – |
| Net debt, September 30, 2026non-GAAP | $327.6M | – | – |
| Net debt leverage ratio, September 30, 2026non-GAAP | 3.6 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Branded SpiritsExcluding the other products category, sales were in line with the prior year and were negatively impacted by distributor system cutovers. Penelope Bourbon sales increased 12%, while mid-priced offerings grew 6%. | $58.20M | – | (4) % |
| Distilling SolutionsElevated industry-wide barrel inventories resulted in a 47% decline in brown goods sales. White goods and other co-products sales increased 32% and warehouse services revenue increased 3%. | $28.96M | – | (29) % |
| Ingredient SolutionsGrowth was driven by specialty wheat proteins, including textured proteins, and biofuel and other byproducts, partly offset by lower specialty wheat starch volumes following longer-than-expected downtime after a scheduled plant shutdown. | $30.75M | – | 5 % |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
fiscal 2026 outlook
- Revenue$480 million to $500 million
- Tax rateapproximately 23%
- NoteAdjusted EBITDA expected to be between $90 million to $98 million.
- NoteAdjusted basic EPS expected to be in the $1.50 to 1.80 range, with weighted average basic shares outstanding of approximately 21.4 million.
- NoteFull-year capital expenditures expected to be approximately $20 million.
Capital returns
- The Board of Directors declared a dividend of $0.12 per share of common stock, payable on November 27, 2026, to stockholders of record as of November 13, 2026.
- Payment of dividends and dividend equivalents, year to date ended September 30, 2026: $ (7,797).
- Repurchase of Common Stock, year to date ended September 30, 2026: $ (921).
What drove it
- Consolidated sales declined primarily because of expected lower brown goods sales in Distilling Solutions and lower international private-label bottled-product sales in Branded Spirits' other category, partly offset by higher Ingredient Solutions sales.
- Consolidated gross margin declined as higher waste starch stream costs in Ingredient Solutions, higher costs in Branded Spirits and lower brown goods volume more than offset lower distillation costs in Distilling Solutions.
- Advertising and promotion expenses declined with the timing of spend throughout the year and savings from outside-agency consolidation.
- Higher white goods production volumes and cost savings initiatives reduced distillation costs.
- An initial insurance recovery payment related to a 2025 equipment outage partially offset higher waste starch stream costs in Ingredient Solutions.
Concerns
- Distilling Solutions brown goods sales declined 47% amid elevated industry-wide barrel inventories.
- Ingredient Solutions gross margin was 6.0%, down from 10.3%, as higher waste starch stream costs pressured profitability.
- Selling, general, and administrative expenses increased 14%, primarily due to a higher incentive compensation accrual.
- Year-to-date GAAP net income was a loss of $ (115,910), including impairment and other expense of $ 180,791.
What to watch
- The pace of brown goods demand and industry-wide barrel inventories in Distilling Solutions.
- Recovery of specialty wheat starch volumes after longer-than-expected downtime following the scheduled plant shutdown.
- Branded Spirits sales following distributor system cutovers and the trajectory of Penelope Bourbon and mid-priced portfolio growth.
- Execution against reaffirmed fiscal 2026 sales, adjusted EBITDA, adjusted basic EPS and capital-expenditure guidance.
- The November 2, 2026 corporate name change to Sempreon, Inc. and ticker change to CASK.
Balance sheet and cash flow
- Year-to-date operating cash outflows were $8.9 million, inclusive of $48.7 million of the Penelope earnout payment classified in operating activities; excluding that payment, year-to-date operating cash inflows were $39.8 million.
- Cash and cash equivalents were $ 13,601 at September 30, 2026.
- Total debt was $ 341,236 and net debt was $ 327,635 at September 30, 2026.
- The company reduced total debt by $28.4 million during the quarter.
- Net cash used in investing activities was $ (13,210) year to date ended September 30, 2026.
Analysis
MGP Ingredients reported a weaker third quarter against a difficult prior-year comparison. Sales were $ 117,911 versus $ 130,912, while gross profit declined to $ 40,459 from $ 49,433 and gross margin fell to 34.3% from 37.8%. GAAP operating income declined to $ 12,017 from $ 21,016, and adjusted EBITDA declined to $ 21,486 from $ 32,255. Net income was $ 6,888 and adjusted net income was $ 8,575.
Distilling Solutions was the principal revenue pressure point. Segment sales declined 29% to $ 28,960, reflecting a 47% decline in brown goods sales amid elevated industry-wide barrel inventories. Branded Spirits sales declined 4% to $ 58,198, driven by lower other-category international private-label bottled-product sales, although Penelope Bourbon sales increased 12% and mid-priced offerings increased 6%.
Ingredient Solutions delivered the only segment sales increase, with revenue up 5% to $ 30,753. The increase reflected specialty wheat proteins and biofuel and other byproducts, but gross profit declined 39% to $ 1,846 and gross margin fell to 6.0%. Higher waste starch stream costs and lower specialty wheat starch volumes following extended downtime after a scheduled shutdown weighed on profitability.
Cash flow and leverage remain central to the reported period. Management said operating cash flow was $32 million during the quarter and total debt was reduced by $28.4 million. However, year-to-date net cash used in operating activities was $ (8,860), including the $48.7 million Penelope earnout payment classified in operating activities, and net debt leverage was 3.6 at September 30, 2026. The company also paid $ (7,797) in dividends and dividend equivalents and repurchased $ (921) of common stock year to date.
Management reaffirmed fiscal 2026 guidance for sales of $480 million to $500 million, adjusted EBITDA of $90 million to $98 million, and adjusted basic EPS of $1.50 to 1.80. The guide assumes an effective tax rate of approximately 23%, capital expenditures of approximately $20 million and weighted average basic shares outstanding of approximately 21.4 million. The company declared a $0.12 per-share quarterly dividend and will change its name to Sempreon, Inc. and ticker to CASK effective November 2, 2026.
Management, verbatim
Our third quarter results show that we are doing what we said we would do. Our cash flow from operations was $32 million during the quarter, and adjusted EBITDA, adjusted basic EPS and ending net leverage each came in better than our expectations. As a result, we are reaffirming guidance,
Julie Francis, president and CEO
In Branded Spirits, Penelope Bourbon sales grew 12% and our mid-priced brands grew 6%. Distilling Solutions continued to navigate an oversupplied market and Ingredient Solutions grew sales by 5%.
Julie Francis, president and CEO
Not in the filing
stated, not guessed- Prior-quarter comparisons for third-quarter consolidated and segment operating metrics were not reported.
- Free cash flow was not reported.
- Quarterly operating cash flow prior-year comparison was not reported.
- Fiscal 2026 gross margin guidance was not reported.
- Fiscal 2026 operating-expense guidance was not reported.
- Previous-release outlook was not provided, so comparison of actual results with prior guidance was not available.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.