MGP Ingredients(MGPI) - 2024 Q4 - Annual Results

Financial Performance - Consolidated sales for Q4 2024 decreased 16% to $180.8 million, with a 7% decrease excluding the Atchison distillery impact[4]. - Net income for Q4 2024 resulted in a loss of$ 42.0 million due to a one-time, non-cash goodwill adjustment of $73.8 million, while adjusted net income decreased 6% to$ 34.4 million[4][7]. - For the full year 2024, consolidated sales decreased 16% to $703.6 million, with adjusted net income down 4% to$ 125.3 million[9]. - The net loss for the year ended December 31, 2024, was $41,998 million, compared to a net income of$ 107,130 million in 2023, indicating a significant decrease in profitability[27]. - MGP Ingredients reported a net loss of $41,998,000 compared to a net income of$ 31,046,000 for the same quarter in 2023[37]. - For the year ended December 31, 2024, total sales were $703,625 thousand, a decrease of$ 1,292 thousand compared to the previous year[53]. Segment Performance - Distilling Solutions segment sales decreased 25% to $82.0 million in Q4 2024, with gross profit down 8% to$ 36.7 million[8]. - Branded Spirits segment sales decreased 12% to $64.0 million in Q4 2024, with gross profit down 11% to$ 29.6 million[11]. - Ingredient Solutions segment sales increased 4% to $34.7 million in Q4 2024, achieving a gross margin of 23.5%[13]. - Total Distilling Solutions sales decreased by 25% to$ 82,045,000 in Q4 2024 from $108,913,000 in Q4 2023[30]. - Year-over-year sales for Total Distilling Solutions fell by 26% to$ 332,204,000 in 2024 from $450,854,000 in 2023[32]. - Year-over-year Branded Spirits sales decreased by 5% to$ 240,816,000 in 2024 compared to $253,933,000 in 2023[32]. - Total Ingredient Solutions sales slightly decreased by 1% to$ 130,605,000 in 2024 from $131,736,000 in 2023[32]. Goodwill and Impairment - The company incurred a goodwill impairment of$ 73.755 million in 2024, which was not present in 2023, indicating a significant impact on financial results[27]. - Goodwill impairment for Q4 2024 was $73,755,000, impacting overall operating income significantly[34]. - The company experienced a goodwill impairment of$ 73,755,000 for the year ended December 31, 2024, which is nondeductible for income tax purposes[40]. Cash and Assets - Total current assets increased to $546.136 million in 2024 from$ 514.297 million in 2023, reflecting a growth of approximately 6.2%[28]. - Cash and cash equivalents rose to $25.273 million in 2024, up from$ 18.388 million in 2023, marking an increase of about 37.5%[28]. - MGP Ingredients' total debt as of December 31, 2024, was $323,541,000, with a net debt of$ 298,268,000, resulting in a net debt leverage ratio of 1.5[41]. Shareholder Actions - The company repurchased 758,576 shares for $36.6 million in Q4 2024 and 886,936 shares for$ 46.6 million during the full year[4][9]. Guidance and Projections - 2025 financial guidance projects sales between $520 million and$ 540 million, with adjusted EBITDA expected in the range of $105 million to$ 115 million[17]. - Adjusted EBITDA guidance for the full year 2024 is provided on a non-GAAP basis, but specific figures are not disclosed due to uncertainty in predicting certain GAAP items[25]. Tax and Expenses - The effective tax rate for Q4 2024 was (31.5)%, primarily due to the goodwill adjustment, with an adjusted rate of 24.0%[16]. - The effective tax rate, excluding the impacts of the nondeductible goodwill impairment, was 24.0% for the quarter ended December 31, 2024[40]. - The company’s advertising and promotion expenses for the year increased to $40.508 million in 2024 from$ 38.213 million in 2023, reflecting a rise of approximately 6.0%[27]. Operational Losses - The company reported an operating loss of $30.442 million for the fourth quarter of 2024, compared to an operating income of$ 43.072 million in the same quarter of 2023[27]. - Operating income for Q4 2024 was a loss of $30,442,000, a decrease of 171% compared to an operating income of$ 43,072,000 in Q4 2023[34].