ATCHISON, KAS. — Steady improvement across all areas of its business helped MGP Ingredients turn the corner in fiscal 2014, returning the Atchison-based company to profitability after a difficult fiscal 2013.
Net income in the year ended Dec. 31, 2014, totaled $23,675,000, equal to $1.32 per share on the common stock, which compared with a loss of $4,929,000 in the previous year. Fiscal 2014 results included $8.3 million in insurance recoveries for settlement of a claim related to a fire at the company’s Indiana facility early in the year that damaged a feed dryer house and caused a temporary loss of production.
Sales for the year were $338,352,000, up from $334,070,000 in the previous year.
“We are very pleased with our 2014 results, both from a financial standpoint and in setting a solid foundation for our long-term growth,” said Gus Griffin, president and chief executive officer of MGPI. “We have turned the corner and are seeing steady improvement in all areas of our business.”
Gross profit and gross margin for the Ingredients Solutions segment declined to $6.1 million and 10.7% of net sales in fiscal 2014, which compared with $7 million and 11.8% of net sales in 2013. The segment’s strategic focus remains on the production and commercialization of specialty ingredients, which is reflected in the year-over-year increase in specialty products to 82.4% of total segment net sales from 81.2% in 2013. For 2014, volumes of specialty starches rose 7.6% and their share of total segment volume increased 3.4 points to 56.7%. Specialty protein volumes declined 8.9%, MGPI said.
“The favorable mix shift towards specialty products is further evidence of our focus on maximizing the value of our production,” Mr. Griffin said. “While we are disappointed with the decline in specialty protein sales, we are confident in our plans to realize the long-term potential of this market.”
In addition to the release of its financial results, MGPI said its board of directors has authorized the purchase of up to $3,500,000 market value of the company’s common stock. The repurchase program may be suspended or discontinued at any time and will expire March 1, 2016.“The board of directors and our management team have a strong conviction in our long-term growth prospects and our ability to generate profits and cash flow,” said Karen Seaberg, chairperson of the board of directors. “We believe that stock repurchases demonstrate our commitment to building stockholder value as well as confidence in achieving our long-term growth plans.”