Refinements to strategy paying off for MGP Ingredients

by Eric Schroeder
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LAWRENCEBURG, INDIANA, U.S. — Maximizing value, investing to grow, safety and sustainability are key focal points of MGP Ingredients, Inc.’s strategy, the company’s top executive told participants at a corporate analyst meeting on June 7.

Augustus C. Griffin, president and chief executive officer, identified several pillars that MGPI intends to build upon in the years ahead.

In terms of maximizing value, Griffin said MGPI has “stopped focusing on volume and started focusing on value.” The company also is looking to capture value share, which revolves around the company’s ability to introduce its own brands and gain a bigger share of the overall profit pie.

A third pillar, investing to grow, was described by Griffin as “us having the confidence in our strategic direction and the financial fire power to make the appropriate investments to drive that growth.”

MGPI has slightly altered a fourth pillar, which was strong risk management focused primarily on controlling input costs. Now, that pillar has been expanded to be more encompassing, Griffin said.

“We want to make sure we’re controlling our input costs and managing those as best we can but also making sure that we are running our plants as efficiently as we can, making sure we’re producing the highest quality products and making sure we’re derisking all aspects of our organization,” he said.

Griffin said MGPI has refined the foundation of its strategy, making safety a cornerstone and implementing a stronger commitment to sustainability.

“We’ve recently announced two major initiatives in sustainability,” he said. “We are now sourcing 100% of all electricity needs in all of our facilities from renewable wind power. We have also eliminated all Styrofoam and single-use plastics from all of our facilities, and we continue to investigate and invest in initiatives to reduce emissions, waste and water usage.”

Looking further ahead, Griffin said MGPI plans to focus on three key drivers of long-term growth, including TruTex, a textured specialty protein; the American Whiskey category; and the company’s MGP Brands initiative.

Specialty wheat proteins grew nearly 7% at MGPI last year, but Griffin said sales of TruTex have doubled, highlighting the interest in that particular product.

“The consumer interest in plant-based proteins is very strong and projected to continue and provide us with a good steady trend to benefit from,” he said. “MGP, specifically, we endured some self-inflicted wounds over the past few years, and we had to rebuild our supply chain and rebuild our customer base. We saw the potential in the plant-based protein trends, thought it was worth making those investments. We’ve made those investments.”

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