MGP Ingredients (NASDAQ: MGPI) reported Q3 EPS of $0.52, $0.01 better than the analyst estimate of $0.51. Revenue for the quarter came in at $95 million versus the consensus estimate of $92.93 million.

• Consolidated net sales increased 10.1% to $95.0 million, reflecting growth in both the Distillery Products and Ingredient Solutions segments.
• Consolidated gross profit increased 5.2% to $19.6 million from $18.6 million, driven by gross profit growth in the Ingredient Solutions segment, partially offset by a decline in the Distillery Products segment.
• Consolidated operating income increased 14.7% to $12.0 million, from $10.5 million in the prior-year quarter, primarily driven by an increase in gross profit in the Ingredient Solutions segment and a decrease in SG&A expenses.
• Earnings per share decreased to $0.52 per share from $0.82 per share in the prior-year quarter, primarily due to the gain on sale of equity method investment recorded in the third quarter of 2017 from the successful sale of Illinois Corn Processing, LLC, partially offset by the decrease in the effective tax rate and an increase in operating income.

“Our third quarter results exhibit the top-line improvement we expected. However, we did experience some short-term production challenges at our Lawrenceburg facility that impacted our margins. We are confident that the issues have been resolved, and we are poised for further growth in the fourth quarter. Based on the improved momentum of our business and the continued solid execution of our strategic plan, we are again reaffirming our operating income growth guidance for the year,” said Gus Griffin, president and CEO of MGP Ingredients.

Conclusion

“The improved top-line performance we achieved this quarter demonstrates our ability to take advantage of the key consumer trends that benefit both segments,” Griffin added. “We continue to invest for the long term to insure we achieve the full benefit of our strong position in the distillery segment. Our total investment in barreled whiskey inventory declined slightly this quarter due to the anticipated strong sales of new distillate. We expect to see further growth in this inventory level. Additionally, the $51.8 million warehouse expansion program continues on track to be completed in 2020. Finally, our own portfolio of premium spirit brands continues to win top accolades and gain consumer interest,” concluded Griffin.

For earnings history and earnings-related data on MGP Ingredients (MGPI) click here.