KANSAS | 0-17196 | 45-4082531 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
MGP INGREDIENTS, INC. | ||
Date: March 12, 2014 | By: | /s/ Don Tracy |
Don Tracy, co-Chief Executive Officer | ||
/s/ Randy Schrick | ||
Randy Schrick, co-Chief Executive Officer |
• | Company reports highest quarterly gross margin for the year, aided by lower new crop corn prices and favorable basis management |
• | Fourth quarter net loss of $0.4 million ($0.02 per share) after $3.4 million in proxy-related costs |
• | Fourth quarter sales down vs year ago due to reduced sourcing of alcohol from joint venture |
• | Company expects gross margin strength to continue, as reflected in contracted distillery sales and lower commodity costs |
• | Distillery products sales for the fourth quarter were $63.3 million, a decrease of 11.4 percent compared to the prior year quarter. The Company experienced sales declines in both distillers feed and lower-grade industrial alcohol products. The distillery products segment reported fourth quarter pre-tax operating income of $6.1 million compared to pre-tax operating income of $4.9 million during the same quarter a year ago. |
• | For the twelve months of 2013, distillery segment sales were $264 million, a decrease of 4.6 percent compared to the prior year period. The decrease was mainly driven by an 82 percent reduction in industrial alcohol supplied from the Company’s joint venture partner. Pre-tax operating income for the year was $11.9 million compared to $14.8 million in the previous year. Overall distillery segment pricing decreased 5.0 percent from the previous year. The per-bushel cost of corn decreased 1.9 percent while the per-million cubic foot cost of natural gas averaged 3.0 percent higher year-over-year. |
• | Ingredient segment sales for the fourth quarter were $13.9 million, a decrease of 4.6 percent from the prior year’s quarter. Some of the Company’s specialty products experienced lower volumes during the period. The ingredients segment reported fourth quarter pre-tax operating income of $559,000, or approximately 4 percent of sales, compared to income of $1.2 million, or approximately 9 percent of sales, for the same quarter a year ago. |
• | For the twelve months of 2013, ingredient segment sales were $58.9 million, a year-over-year increase of 4.4 percent. In addition to higher sales of specialty starches, tight market conditions created a temporary selling opportunity for sales of commodity protein. Pre-tax operating income for the year was $4.5 million compared to $5.2 million in the prior period. This was mainly due to higher raw material cost for flour that outpaced pricing increases. Flour costs averaged 14.7 percent higher per pound over the prior year. |
(unaudited) | Quarter Ended | Year to Date Ended | ||||||||||||
(Dollars in thousands, except per share) | December 31, 2013 | December 31, 2012 | December 31, 2013 | December 31, 2012 | ||||||||||
Sales | $ | 80,936 | $ | 86,350 | $ | 334,070 | $ | 338,232 | ||||||
Less: excise taxes | 3,642 | — | 10,806 | 3,897 | ||||||||||
Net sales | 77,294 | 86,350 | 323,264 | 334,335 | ||||||||||
Cost of sales (a) | 69,380 | 78,930 | 302,025 | 309,312 | ||||||||||
Gross profit | 7,914 | 7,420 | 21,239 | 25,023 | ||||||||||
Selling, general and administrative expenses | 8,797 | 6,466 | 26,202 | 26,536 | ||||||||||
Other operating costs and losses on sale of assets | 177 | (16 | ) | 236 | (569 | ) | ||||||||
Income (loss) from operations | (1,060 | ) | 970 | (5,199 | ) | (944 | ) | |||||||
Gain on sale of joint venture interest | — | — | — | 4,055 | ||||||||||
Interest expense | (289 | ) | (159 | ) | (1,118 | ) | (868 | ) | ||||||
Equity in earnings (loss) of joint ventures | 758 | (465 | ) | (204 | ) | (301 | ) | |||||||
Income (loss) from continuing operations before income taxes | (591 | ) | 346 | (6,521 | ) | 1,942 | ||||||||
Provision for income taxes | (758 | ) | 166 | (714 | ) | 318 | ||||||||
Net income (loss) from continuing operations | 167 | 180 | (5,807 | ) | 1,624 | |||||||||
Discontinued operations, net of tax | (528 | ) | — | 878 | — | |||||||||
Net income (loss) | (361 | ) | 180 | (4,929 | ) | 1,624 | ||||||||
Other comprehensive income (loss), net of tax | 630 | (209 | ) | 229 | 802 | |||||||||
Comprehensive income (loss) | $ | 269 | $ | (29 | ) | $ | (4,700 | ) | $ | 2,426 | ||||
Basic and diluted earnings (loss) per share | ||||||||||||||
Income (loss) from continuing operations | $ | 0.01 | $ | 0.01 | $ | (0.34 | ) | $ | 0.09 | |||||
Income from discontinued operations | (0.03 | ) | — | 0.05 | — | |||||||||
Net income (loss) | $ | (0.02 | ) | $ | 0.01 | $ | (0.29 | ) | $ | 0.09 | ||||
Weighted average shares outstanding – basic | 17,142,023 | 16,995,251 | 17,069,455 | 16,951,168 | ||||||||||
Weighted average shares outstanding – diluted | 17,142,023 | 16,995,251 | 17,069,455 | 16,951,168 |
(Dollars in thousands) | December 31, 2013 | December 31, 2012 | (Dollars in thousands) | December 31, 2013 | December 31, 2012 | |||||||||||
ASSETS | LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||
Current assets: | Current liabilities: | |||||||||||||||
Cash and cash equivalents | $ | 2,857 | $ | — | Current maturities of long-term debt | $ | 1,557 | $ | 1,683 | |||||||
Restricted cash | — | 12 | Accounts payable | 23,107 | 18,860 | |||||||||||
Receivables | 27,821 | 35,325 | Accounts payable to affiliate, net | 1,204 | 4,008 | |||||||||||
Inventory | 34,917 | 36,532 | Accrued expenses | 7,877 | 5,220 | |||||||||||
Prepaid expenses | 825 | 697 | Current portion of accrued retiree health benefits | 405 | — | |||||||||||
Deposits | 23 | — | Total Current Liabilities | 34,150 | 29,771 | |||||||||||
Deferred income taxes | 4,977 | 5,283 | ||||||||||||||
Refundable income taxes | 466 | 242 | Other liabilities: | |||||||||||||
Total Current Assets | 71,886 | 78,091 | Long-term debt, less current maturities | 3,611 | 5,168 | |||||||||||
Revolving credit facility | 18,000 | 25,893 | ||||||||||||||
Property and equipment | 194,687 | 190,519 | Deferred credit | 3,925 | 4,133 | |||||||||||
Less accumulated depreciation and amortization | (124,443 | ) | (115,128 | ) | Accrued retirement, health and life insurance benefits | 4,423 | 5,096 | |||||||||
Other noncurrent liabilities | 640 | 1,000 | ||||||||||||||
Net Property, Plant | Deferred income taxes | 4,977 | 5,283 | |||||||||||||
and Equipment | 70,244 | 75,391 | Total Liabilities | 69,726 | 76,344 | |||||||||||
Equity method investments | 7,123 | 7,301 | Stockholders’ equity | 81,603 | 86,827 | |||||||||||
Other noncurrent assets | 2,076 | 2,388 | ||||||||||||||
TOTAL ASSETS | $ | 151,329 | $ | 163,171 | TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 151,329 | $ | 163,171 | |||||||
Capital Structure | ||||||||||||||||
Net investment in: | Financed By: | |||||||||||||||
Working capital | $ | 37,736 | $ | 48,320 | Long-term debt* | $ | 21,611 | $ | 31,061 | |||||||
Property, plant and equipment | 70,244 | 75,391 | Deferred liabilities | 13,965 | 15,512 | |||||||||||
Other noncurrent assets | 9,199 | 9,689 | Stockholders’ equity | 81,603 | 86,827 | |||||||||||
Total | $ | 117,179 | $ | 133,400 | Total | $ | 117,179 | $ | 133,400 |
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