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INVESTOR PRESENTATION First Quarter 2025 May 2025
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FORWARD LOOKING STATEMENTS AND NON-GAAP DISCLAIMER This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including without limitation statements regarding the impact of whiskey consumption and whiskey inventories on brand goods performance for MGP Ingredients, Inc. (the “Company” or “MGP”); the Company’s ability to deliver full year outlook; and the Company’s 2025 guidance, including its expectations for sales, adjusted EBITDA, adjusted basic earnings per common share ("EPS"), tax rate, shares outstanding, and capital expenditures. Forward looking statements are usually identified by or are associated with words such as “intend,” “plan,” “believe,” “estimate,” “expect,” “anticipate,” “project,” “forecast,” “hopeful,” “should,” “may,” “will,” “could,” “encouraged,” “opportunities,” “potential,” and similar terminology. These forward-looking statements reflect management’s current beliefs and estimates of future economic circumstances, industry conditions, Company performance, Company financial results, and Company financial condition and are not guarantees of future performance. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Factors that could cause actual results to differ materially from our expectations include without limitation any effects of changes in consumer preferences and purchases and our ability to anticipate or react to those changes; our ability to compete effectively and any effects of industry dynamics and market conditions; damage to our reputation or that of any of our key customers or their brands; failure to introduce successful new brands and products or have effective marketing or advertising; changes in public opinion about alcohol or our products; our reliance on our distributors to distribute our branded spirits; our reliance on fewer, more profitable customer relationships; interruptions in our operations or a catastrophic event at our facilities; decisions concerning the quantity of maturing stock of our aged distillate; any inability to successfully complete our capital projects or fund capital expenditures or any warehouse expansion issues; our reliance on a limited number of suppliers; our reliance on a limited number of suppliers; work disruptions or stoppages; climate change and measures to address climate change; regulation and taxation and compliance with existing or future laws and regulations; tariffs, trade relations, and trade policies; excise taxes, incentives and customs duties; our ability to protect our intellectual property rights and defend against alleged intellectual property rights infringement claims; failure to secure and maintain listings in control states; labeling or warning requirements or limitations on the availability of our products; product recalls or other product liability claims; anti-corruption laws, trade sanctions, and restrictions; litigation or legal proceedings; limited rights of common stockholders and anti- takeover provisions in our governing documents; the impact of issuing shares of our common stock; higher costs or the unavailability and cost of raw materials, product ingredients, energy resources, or labor; failure of our information technology systems, networks, processes, associated sites, or service providers; acquisitions and potential future acquisitions; interest rate increases; reliance on key personnel; commercial, political, and financial risks; covenants and other provisions in our credit arrangements; pandemics or other health crises; ability to pay any dividends and make any share repurchases; and the effectiveness or execution of our strategic plan. For further information on these risks and uncertainties and other factors that could affect the Company’s business, see the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, as well as the Company’s other SEC filings. The Company undertakes no obligation to update any forward-looking statements or information in this presentation, except as required by law. Non-GAAP Financial Measures In addition to providing financial information in accordance with U.S. GAAP, the Company provides certain non-GAAP financial measures that are not in accordance with, or alternatives for, GAAP. In addition to the comparable GAAP measures, the Company has disclosed adjusted operating income, adjusted net income, adjusted EBITDA, net debt, net debt leverage ratio, and adjusted basic and diluted EPS, as well as guidance for adjusted EBITDA and adjusted basic EPS. The presentation of these non-GAAP financial measures should be reviewed in conjunction with operating income, net income, debt, and basic and diluted EPS computed in accordance with U.S. GAAP and should not be considered a substitute for the GAAP measure. We believe that the non-GAAP measures provide useful information to investors regarding the Company's performance and overall results of operations. In addition, management uses these non-GAAP measures in conjunction with GAAP measures when evaluating the Company’s operating results compared to prior periods on a consistent basis, assessing financial trends and for forecasting purposes. Non-GAAP financial measures may not provide information that is directly comparable to other companies, even if similar terms are used to identify such measures. The appendix provide a full reconciliation of historical non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure. Full year 2024 guidance measures of adjusted EBITDA and adjusted basic EPS are provided on a non-GAAP basis without a reconciliation to the most directly comparable GAAP measures because the Company is unable to predict with a reasonable degree of certainty certain items contained in the GAAP measures without unreasonable efforts. Such items include without limitation, acquisition related expenses, restructuring and related expenses, and other items not reflective of the Company's ongoing operations. NASDAQ:MGPI2
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FIRST QUARTER 2025 RESULTS • Consolidated sales decreased 29% to $121.7 million. • Branded Spirits segment sales declined 4% due to double digit decline in mid and value priced brands portfolio. Premium plus sales increased 7%, driven partly by Penelope’s continued strong growth. • Distilling Solutions sales and gross profit each declined by 45%, reflecting lower brown goods sales. While our brown goods volumes and price/mix were down, they were consistent with our expectations. • Ingredient Solutions sales decreased 26% primarily due to supply challenges from adverse weather and complexities associated with the closure of the Atchison distillery as well as timing of the commercialization of new customers. • Adjusted EBITDA and adjusted EPS decreased by 46% and 66% to $21.8 million and $0.36, respectively. • First quarter cash flow from operations increased 82% to $44.7 million. Our net debt leverage remains relatively stable at 1.6x as of March 31, 2025. 3 Note: All comparisons are on a year-over-year basis. See appendix for GAAP to non-GAAP reconciliations. ENCOURAGING FIRST QUARTER RESULTS WITH SIGNS OF POSITIVE PROGRESS ACROSS ALL THREE OPERATING SEGMENTS
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LOWER SALES AND GROSS PROFITS PRIMARILY DRIVEN BY THE EXPECTED DECLINE IN BROWN GOODS 4 Consolidated Gross Profit (Quarter Ended 3/31/2025) Change vs Prior Year $MM $MM % Branded Spirits $22.2 $(0.3) (1)% Distilling Solutions 18.7 (15.4) (45) Ingredient Solutions 2.5 (3.7) (60) MGP Ingredients $43.3 $(19.5) (31)% FIRST QUARTER SALES AND GROSS PROFIT DECREASED BY 29% AND 31%, RESPECTIVELY Note: Totals may not match due to rounding. All comparisons are on a year-over-year basis. Consolidated Sales (Quarter Ended 3/31/2025) Change vs Prior Year $MM $MM % Branded Spirits $48.2 $(1.9) (4)% Distilling Solutions 46.9 (37.9) (45) Ingredient Solutions 26.5 (9.1) (26) MGP Ingredients $121.7 $(48.9) (29)%
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ADJUSTED EPS DECLINE REFLECTS LOWER OPERATING INCOME AND HIGHER EFFECTIVE TAX RATE 5 1 Items are net of tax based on the effective tax rate for the base year (2024) Note: See appendix for GAAP to non-GAAP reconciliations First Quarter Adjusted EPS(1) $1.07 ($0.66) ($0.01) ($0.07) $0.01 $0.01 $0.01 $0.36 Adjusted Basic and Diluted EPS Q1 2024 Operating income Interest expense, net Other income (expense), net Weighted average shares outstanding Effective tax rate Participanting securities Adjusted Basic and diluted EPS Q1 2025
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BRANDED SPIRITS 6 Branded Spirits (Quarter ended 3/31/2025) Change vs Prior Year $MM $MM % Premium plus $22.3 $1.4 7% Mid 13.0 (1.7) (12) Value 7.3 (2.7) (27) Other 5.5 1.1 24 Sales $48.2 $(1.9) (4)% Gross Profit $22.2 $(0.3) (1)% Gross Margin 46.0% 1.1 pp PENELOPE’S ONGOING MOMENTUM DRIVING PREMIUM PLUS GROWTH Note: Total may not foot due to rounding. All comparisons are on a year-over-year basis. PP: Percentage points
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DISTILLING SOLUTIONS 7 Distilling Solutions (Quarter ended 3/31/2025) Change vs Prior Year $MM $MM % Change Brown goods $33.7 $(32.7) (49)% Warehouse services 8.1 0.1 2 White goods and other co-products 5.2 (5.4) (51) Sales $46.9 $(37.9) (45)% Gross Profit $18.7 $(15.4) (45)% Gross Margin 39.8% (0.4) pp BROWN GOODS SALES AND GROSS PROFIT DECLINE IN LINE WITH OUR EXPECTATIONS Note: Total may not foot due to rounding. All comparisons are on a year-over-year basis. PP: Percentage points
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INGREDIENT SOLUTIONS 8 Ingredient Solutions (Quarter ended 3/31/2025) Change vs Prior Year $MM $MM % Specialty wheat starches $15.9 $(6.4) (29)% Specialty wheat proteins 7.4 (2.7) (26) Commodity wheat starches 2.7 (0.5) (17) Commodity wheat proteins 0.6 0.5 1,422 Sales $26.5 $(9.1) (26)% Gross Profit $2.5 $(3.7) (60)% Gross Margin 9.3% (8.1) pp QUARTERLY PERFORMANCE IMPACTED BY UNFAVORABLE WEATHER AND TIMING OF COMMERCIALIZATION OF NEW CUSTOMERS Note: Total may not foot due to rounding. All comparisons are on a year-over-year basis. PP: Percentage points
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Full Year 2025 Guidance1 Sales $520 million to $540 million Adjusted EBITDA $105 million to $115 million Adjusted basic EPS $2.45 to $2.75 Effective tax rate ~ 25% Basic weighted average shares outstanding ~ 21.3 million Capital expenditures ~ $36 million REAFFIRM 2025 FINANCIAL GUIDANCE 9 1 Guidance is as of May 1, 2025. REMAIN ON-TRACK TO DELIVER FULL YEAR OUTLOOK
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0.2x 1.5x 1.0x 1.3x 1.5x 1.6x 2020 2021 2022 2023 2024 Q1 2025 TTM Net Leverage Ratio SUCCESSFUL REFINANCING REFLECTS STRONG CASH FLOWS AND BALANCE SHEET • Balance sheet remains healthy and well capitalized, with total debt of $297 million and a cash position of $20 million(1) • Excellent access to capital with total availability of $548 million under our credit facility and note purchase agreement, as of March 31, 2025 • Net leverage ratio of 1.6x(1) • On April 24, 2025, we successfully upsized our credit facility from $400 million to $500 million, extended its maturity to 2030, and increased the size of the accordion feature from $100 million to $200 million. In addition, the shelf for issuing up to $250 million of senior secured promissory notes was extended to 2028 10 Note: 1 as of March 31, 2025; See appendix for GAAP to non-GAAP reconciliations. AMENDED CREDIT FACILITY FURTHER BOLSTERS ALREADY EXCELLENT ACCESS TO CAPITAL
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+52% *13 Week Y/Y S t r o n g T u r n a r o u n d C o n t i n u e s f o r R E B E L 1 0 0 FOCUS BRANDS DRIVING PREMIUM PLUS GROWTH I n n o v a t i o n D r i v i n g C o n t i n u e d M o m e n t u m * *Nielsen Sales dollars – 13 week period ending 03/22/2025 P a c k a g i n g R e f r e s h i n Q 1 +13% *13 Week Y/Y +41% *13 Week Y/Y
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APPENDIX
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CHANGE IN BASIC AND DILUTED EPS 13 1 Items are net of tax based on the effective tax rate for the base year (2024) Change in Basic and Diluted EPS, quarter versus quarter EPS Change Quarter ended March 31, 2024 $0.92 Change in operating income (loss)1 (1.01) (110)% Change in interest expense, net1 0.01 1% Change in other income (expense), net1 0.01 1% Change in effective tax rate (0.07) (8)% Change in income allocated to participating securities 0.01 1% Change in weighted average shares outstanding (0.01) (1)% Quarter ended March 31, 2025 (0.14) (116)%
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RECONCILIATION OF SELECTED GAAP TO NON-GAAP MEASURES 14 NET INCOME TO ADJUSTED EBITDA AND NET DEBT LEVERAGE RATIO ($ in thousands) 2020 2021 2022 2023 2024 Net Income $40,345 $90,817 $108,872 $107,130 $34,465 Interest 2,267 4,037 5,451 6,647 8,439 Taxes 12,256 30,279 31,300 34,616 33,977 Depreciation and amortization 12,961 19,092 21,455 22,113 21,989 Share-based compensation expense 5,289 3,306 5,502 7,501 3,188 Equity method investment loss (gain) - 1,611 2,220 337 (1,827) Impairment of long-lived assets and other - - - 19,391 137 Fair value of contingent consideration - - - 7,100 16,100 Goodwill impairment - - - - 73,755 Business acquisition costs 919 8,927 - 2,060 116 Executive transition costs 1,932 - - 3,134 4,075 Insurance recoveries - (16,325) - - - Unusual items cost - - - - 2,081 Inventory step-up – Branded Spirits - 2,529 - - - Adjusted EBITDA $75,969 $144,273 $174,800 $210,029 $196,495 Total debt $39,871 $233,399 $230,335 $287,249 $323,541 Cash and cash equivalents 21,662 21,568 47,889 18,388 25,273 Total net debt $18,209 $211,831 $182,446 $268,861 $298,268 Net debt leverage ratio1 0.2x 1.5x 1.0x 1.3x 1.5x 1 Net debt leverage ratio is defined as net debt divided by adjusted EBITDA
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RECONCILIATION OF SELECTED GAAP TO NON-GAAP MEASURES 15 NET DEBT LEVERAGE RATIO 1 TTM is defined as trailing twelve months 2 Net debt leverage ratio is defined as net debt divided by adjusted EBITDA ($ in thousands) Quarter Ended 6/30/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2024 Quarter Ended 3/31/2025 TTM1 3/31/2025 Net income (loss) $32,017 $23,862 $(41,998) $(3,057) $10,824 Interest expense 2,205 2,174 2,041 1,854 8,274 Income tax expense 10,108 7,554 10,053 671 28,386 Depreciation and amortization 5,329 5,680 5,691 5,808 22,508 Share based compensation 865 767 440 742 2,814 Equity method investment gain (910) (832) (381) (257) (2,380) Impairment of long-lived assets and other 21 - - - 21 Goodwill Impairment - - 73,755 - 73,755 Professional service fees - - - 382 382 Fair value of contingent consideration 5,400 6,400 200 14,700 26,700 Business acquisition costs 15 15 15 - 45 Executive transition costs 843 - 2,857 306 4,006 Restructuring and other costs - - - 613 613 Unusual items costs 1,639 34 408 - 2,081 Adjusted EBITDA $57,532 $45,654 $53,081 $21,762 $178,029 Total debt $297,114 Cash and cash equivalents 20,112 Net debt $277,002 Net debt leverage ratio2 1.6x
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RECONCILIATION OF SELECTED GAAP TO NON-GAAP MEASURES 16 FOR THE QUARTERS ENDED MARCH 31, 2025 AND 2024 Quarter Ended March 31, 2025 (in thousands, except per share amounts) Operating Income Net Income Basic and Diluted EPS Reported GAAP Results $(747) $(3,057) $(0.14) Fair value of contingent consideration 14,700 9,937 0.46 Executive transition costs 306 207 0.01 Professional service fees 382 258 0.01 Restructuring and other costs 613 414 0.02 Adjusted Non-GAAP Results $15,254 $7,759 $0.36 Quarter Ended March 31, 2024 (in thousands, except per share amounts) Operating Income Net Income Basic and Diluted EPS Reported GAAP Results $28,917 $20,584 $0.92 Impairment of long-lived assets and other 116 89 - Fair value of contingent consideration 4,100 3,145 0.14 Business acquisition costs 71 55 - Executive transition costs 375 288 0.01 Adjusted Non-GAAP Results $33,579 $24,161 $1.07
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RECONCILIATION OF SELECTED GAAP TO NON-GAAP MEASURES 17 RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA ($ in thousands) Quarter Ended 3/31/2025 Quarter Ended 3/31/2024 Net income (loss) $(3,057) $20,584 Interest expense 1,854 2,019 Income tax expense 671 6,262 Depreciation and amortization 5,808 5,289 Share based compensation 742 1,116 Equity method investment loss (gain) (257) 296 Fair value of contingent consideration 14,700 4,100 Executive transition costs 306 375 Professional service fees 382 - Impairment of long-lived assets and other - 116 Business acquisition costs - 71 Restructuring and other costs 613 - Adjusted EBITDA $21,762 $40,228
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DESCRIPTION OF NON-GAAP ITEMS • Fair value of contingent consideration relates to the quarterly adjustment of the contingent consideration liability related to the acquisition of Penelope Bourbon LLC. It is included in the Condensed Consolidated Statement of Income as a component of operating income and relates to the Branded Spirits segment. • The executive transition costs are included in the Condensed Consolidated Statement of Income within the selling, general, and administrative line item. The adjustment includes costs related to the transition of certain executive positions. • The professional services fees are included in the Condensed Consolidated Statement of Income within the selling, general, and administrative line item. The adjustment includes costs related to professional services in conjunction with the goodwill impairment valuation and other special projects. • Business acquisition costs are included in the Condensed Consolidated Statement of Income within the selling, general, and administrative line item and include transaction and integration costs associated with the various acquisitions and mergers. • The restructuring and other costs are included in the Condensed Consolidated Statement of Income within the selling, general, and administrative line item. The adjustment includes special one-time severance costs related to the reduction in force that occurred during the period. • The impairment of long-lived assets and other relates to impairments of assets as well as miscellaneous expenses in connection with the closure of the Atchison distillery. Impairment of long-lived assets and other are included in the Condensed Consolidated Statement of Income as a component of operating income and relates to the Distilling Solutions segment. • Business acquisition costs are included in the Condensed Consolidated Statement of Income within the selling, general, and administrative line item and include transaction and integration costs associated with the acquisition of Penelope Bourbon LLC. 18