MGP Ingredients reports 24% sales decline in 2025 as whiskey demand slumps
Lower brown goods sales and operational challenges weigh on annual performance.
USA – US distilling group MGP Ingredients has reported a sharp decline in sales for 2025, with consolidated revenue falling 24% year over year to US$536.4 million, primarily due to weakening demand for its whiskey products.
Fourth quarter 2025 consolidated sales decreased by 23% compared to the prior-year period. The company attributed the decline mainly to lower brown goods sales within its Distilling Solutions segment, alongside the residual impact from the outage of a key piece of equipment that affected the Ingredient Solutions segment.
Gross profit also came under pressure during the quarter. Consolidated gross profit fell 35% to US$48.3 million, while gross margin decreased by 630 basis points to 34.9%.
The company stated that higher waste starch stream disposal costs related to the Ingredient Solutions segment further weighed on profitability.
Fourth quarter operating income declined to a loss of US$135.2 million. Adjusted operating income dropped 60% to US$18.7 million, and adjusted EBITDA decreased 51% to US$26.1 million.
For the full year, gross profit declined 30% to US$199.4 million, while gross margin decreased by 350 basis points to 37.2%.
The company said the reduction was driven primarily by lower brown goods volumes, the impact of the equipment outage, and higher waste starch disposal costs at its ingredients plant.
Full-year net income and basic earnings per share declined to a loss of US$107.8 million and US$4.99, respectively.
Julie Francis, who became Chief Executive Officer in July, described 2025 as a transition period for the business. “2025 was a year of deliberate repositioning for MGP,” she said.
She added: “From an industry standpoint, we believe that elevated inventory levels will continue to pressure our brown goods business in the near-term. However, we expect improved operational reliability in the Ingredient Solutions segment, continued premium plus momentum, and accelerated productivity and cost discipline to help partially offset these headwinds – all of which are reflected in our 2026 guidance.”
Despite the drop in net income, full-year cash flow from operations increased to US$121.5 million, supported by tighter working capital management, including barrel inventory control.
Net whiskey put-away declined from US$32.9 million in 2024 to US$18.5 million in 2025, while capital expenditures fell 56% to US$31.9 million.
Within its segments, Branded Spirits sales decreased 3% to US$232.9 million. Premium plus sales increased 5%, while combined sales in the mid and value-priced portfolio declined 13% as the company optimized its offerings.
Distilling Solutions segment sales fell 45% to US$181.4 million, with gross profit down 52% to US$68.6 million. Ingredient Solutions segment sales decreased 7% to US$122.0 million, while gross profit declined 41% to US$15.5 million.
Looking ahead, MGP Ingredients has forecast 2026 sales in the range of US$480 million to US$500 million, compared to US$536.4 million in 2025.
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