ATCHISON, KANSAS, US — Net income at MGP Ingredients, Inc. decreased 45% in the third quarter ended Sept. 30, falling to $13.21 million, equal to 59¢ per share on the common stock, down from $23.62 million, or $1.07 per share, in the same period a year ago. The decline reflected the impairment of assets and other one-time expenses related to the planned closure of the company’s Atchison distillery as well as the increase in fair value of contingent consideration related to the acquisition of Penelope Bourbon. Adjusted net income in the third quarter increased 28% to $30.2 million.

Net sales, meanwhile, increased, rising 5.2% to $211.62 million from $201.15 million.

Gross profit in the Ingredient Solutions segment increased to $11.1 million in the third quarter of fiscal 2023, up 37% from $8.1 million in the third quarter of fiscal 2022, while sales increased 11% to $33 million.

“The increase in sales primarily reflects continued rising consumer preference toward high protein, low net carb diets, which drove higher sales of our specialty wheat proteins and starches as well as our commodity wheat starches,” David J. Colo, president and chief executive officer, said during a Nov. 2 conference call with analysts.

Brandon M. Gall, chief financial officer, during the call provided an update on commodities, noting that corn, wheat flour, rye and natural gas all continued to experience elevated prices throughout the third quarter.

“Compared to the prior-year period, our input cost for corn increased 4%, wheat flour increased 24%, rye increased 40% and natural gas increased 30%,” Gall said. “Our risk management process and our focus on products that are premium and more specialty in nature, have continued to enable us to mitigate the impacts of higher input costs over the past several quarters in most of our product lines.”

Looking ahead to the remainder of fiscal 2023, MGPI reaffirmed full-year sales in the range of $815 million to $835 million, while raising its forecast for adjusted EBITDA to a range of $192 million to $197 million, up from a previous range of $187 million to $192 million. Adjusted earnings per share are expected to be in the $5.50 to $5.65 range, up from an earlier forecast of $5.35 to $5.50.

In the nine months ended Sept. 30, net income was $75.65 million, or $3.43 per share, down 12% from $86.12 million, or $3.91 per share, in the same period a year ago. Sales were $621.64 million, up 5.1% from $591.36 million.