Mgp Ingredients, Inc. · NASDAQ:MGPI
Mgp Ingredients — Investor Presentation (September 2005)
32 slides from Mgp Ingredients's investor presentation, Sep 8, 2005
Slide 1: Cautionary Note
MGP Ingredients, Inc. Cautionary Note Please note that this presentation was created as of September 2, 2005, and reflects management's views as of that date. Certain of the information discussed in this presentation may contain forward-looking statements relating to the operations, financial condit
Slide 2: Corporate Overview
MGP Ingredients, Inc. Corporate Overview o Founded in 1941 o Fully integrated ingredients company o Four locations o 480 employees o Traded on the NASDAQ Market under ticker symbol MGPI o Approximately $275 million in annual sales revenue
Slide 3: Investment Considerations
MGP Ingredients, Inc. Investment Considerations o Legacy and market leadership o Innovation and intellectual capital o Specialty products focus in large market arenas o Financial strength
Slide 4: Legacy and Leadership
MGP Ingredients, Inc. Legacy and Leadership o Over six decades of industry experience o Innovator of plant protein and starch development o Market leader: - Largest U.S. producer of wheat proteins and wheat starches - Among leading U.S. producers of natural food grade industrial alcohol - One of thr
Slide 5: Compelling Market Opportunities
MGP Ingredients, Inc. Compelling Market Opportunities o Health and wellness lifestyle trends o Accelerated pet industry product growth o Continued growth in demand for natural vs. synthetic products o Increased interest in bio-economy initiatives o Growing use of alternative fuels
Slide 6: Innovation and Intellectual Capital
MGP Ingredients, Inc. Innovation and Intellectual Capital o First to Market: - Fibersym(TM) Resistant Starches - FiberRite(TM)RW Resistant Starch - Arise(R) Wheat Protein Isolates - Wheatex (R) Textured Wheat Proteins - Chewtex(TM) Protein/Starch Resins o Grain-based technology o Holder of 19 patent
Slide 7: MGPI Vertically Integrated Operation
MGP Ingredients, Inc. MGPI VERTICALLY INTEGRATED OPERATION Ingredients Segment Protein & Starch Processing Distillery Products Segment Food Ingredients Pet Industry Ingredients Personal Care Ingredients Biopolymer Industry Ingredients Alcohol Distillation Food Grade Alcohol o Beverage o Industrial F
Slide 8: Specialty Product Strategy
MGP Ingredients, Inc. Specialty Product Strategy Emerging Developing Base Product Line
Slide 9: Specialty Product Strategy: Food Ingredients
MGP Ingredients, Inc. Specialty Product Strategy Base Product Line MGPI Ingredient Solutions o Food - Fiber enhanced, reduced fat foods............ Fibersym(TM), FiberRite(TM)RW - Frozen, refrigerated and par-baked dough systems .....................Arise(R), FP600(TM), HWG 2009(TM) - Low-carb, high
Slide 10: Specialty Product Strategy: Pet Ingredients
MGP Ingredients, Inc. Specialty Product Strategy Base Product Line MGPI Ingredient Solutions o Food o Pet Ingredients - Pet treats.......................................... MGPI Chewtex(TM) - Pet food............................................. MGPI Pet-tex(TM) o Finished Pet Products - Co-extruded
Slide 11: Specialty Product Strategy: Personal Care
MGP Ingredients, Inc. Specialty Product Strategy Developing Product Line MGPI Ingredient Solutions o Personal Care - Hair Care Products.........Aqua Pro(R), Foam Pro(R) - Skin Care Products...................Omni-Smooth(R)Super, Skin Flow(TM)
Slide 12: Specialty Product Strategy: Biopolymers
MGP Ingredients, Inc. Specialty Product Strategy Emerging Product Line MGPI Ingredient Solutions --------------------- ------------------------- o Biopolymers - Grain-based resins............................. MGPI Terratek(TM) o Bio-based o Biodegradable o Natural Fiber Composites
Slide 13: Financial Strength
MGP Ingredients, Inc. Financial Strength o Solid balance sheet o Financial flexibility o Strong cash flows
Slide 14: Annual Sales FY 2001-2005
MGP Ingredients, Inc. Annual Sales FY 2001 - 2005 Dollars (Millions) FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 32.9 37.4 41.7 85.3 78 46.8 28.8 15.5 17.4 14.5 149.5 148.3 135.2 168.0 182.7 Specialty Ingredients Commodity Ingredients and Mill By-products Distillery Products Note: Total sales and segmen
Slide 15: Annual Pre-tax Earnings Business Segments FY 2001-2005
MGP Ingredients, Inc. Annual Pre-tax Earnings Business Segments FY 2001 - 2005 Dollars (Millions) Ingredients Segment $2.10 $4.60 7 $17.30 -1.8 Distillery Segment $3.30 $7.80 $3.6 $1.00 $8.50 FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 Fiscal Years Ending June 30
Slide 16: Growth Strategy
MGP Ingredients, Inc. Growth Strategy Increase Earnings Per Share o Develop specialty ingredient products for growing markets o Maintain health of distillery operations o Improve financial discipline
Slide 17: Financial Discipline
MGP Ingredients, Inc. Financial Discipline o Leverage fixed assets o Manage costs o Maintain strong working capital o Reinvest for growth
Slide 18: Financial Discipline: Leveraging Fixed Assets
MGP Ingredients, Inc. Financial Discipline Leveraging fixed assets o Produce more specialty food ingredient volume from existing capacity* Specialty Food Ingredient Sales Dollars (Millions) $150 $100 $50 $0 FY 2005 Annual 43.9 110 * Based on product mix assumptions Sales possible with existing capac
Slide 19: Financial Discipline: Manage Cost of Goods Sold
MGP Ingredients, Inc. Financial Discipline Manage cost of goods sold o Protect grain and energy costs through risk management program
Slide 20: Financial Discipline: Manage Cost of Goods Sold
MGP Ingredients, Inc. Financial Discipline Manage cost of goods sold o Protect grain and energy costs through risk management program o Utilize new energy efficient technologies
Slide 21: Financial Discipline: Maintain Strong Working Capital
MGP Ingredients, Inc. Financial Discipline Maintain strong working capital position o Generate cash through improved working capital management Net Cash Provided by Operating Activities Dollars (Millions) $25 $20 $15 $10 $5 FY 2004 FY 2005 11 21.8
Slide 22: Allocating Capital for Increasing Returns
MGP Ingredients, Inc. Allocating Capital for Increasing Returns Continue to reinvest a portion of profits to sustain growth and remain competitive FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 (Projected) 1330.0% 1300.0% 11.8 20.7 19.8 15 Dollars (Millions) $30 $20 $10 $0
Slide 23: Allocating Capital: Specialty Ingredient Capacity Expansions
MGP Ingredients, Inc. Allocating Capital for Increasing Returns Continue to reinvest a portion of profits to sustain growth and remain competitive o Specialty ingredient capacity expansions Project Cost Completed Textured wheat protein expansion at Kansas City facility $4.5 million FY 2005 First Qua
Slide 24: Allocating Capital: Distillery Upgrades
MGP Ingredients, Inc. Allocating Capital for Increasing Returns Continue to reinvest a portion of profits to sustain growth and remain competitive o Specialty ingredient capacity expansions o Distillery Upgrades Project Cost Planned Completion New energy efficient distillers feed equipment at Atchis
Slide 25: Allocating Capital: Sales and Technical Support
MGP Ingredients, Inc. Allocating Capital for Increasing Returns Continue to reinvest a portion of profits to sustain growth and remain competitive o Specialty ingredient capacity expansions o Distillery upgrades o Sales and technical support capabilities
Slide 26: Allocating Capital: Research and Development
MGP Ingredients, Inc. Allocating Capital for Increasing Returns Continue to reinvest a portion of profits to sustain growth and remain competitive o Specialty ingredient capacity expansions o Distillery upgrades o Strengthen sales and technical support capabilities for new products o Research and de
Slide 27: Allocating Capital: Supply Chain Technology
MGP Ingredients, Inc. Allocating Capital for Increasing Returns Continue to reinvest a portion of profits to sustain growth and remain competitive o Specialty ingredient capacity expansions o Distillery upgrades o Sales and technical support capabilities o Research and development initiatives o Supp
Slide 28: Maintaining Flexible Capital Structure and Strong Balance Sheet
MGP Ingredients, Inc. Maintaining Flexible Capital Structure and Strong Balance Sheet Annual Debt to Equity Ratio Dollars (Millions) FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 27.0% 21.0% 0.18 0.13 0.18 30.0% 20.0% 10.0% 0.0%
Slide 29: Realizing Dividend Growth Potential
MGP Ingredients, Inc. Realizing Dividend Growth Potential Continue to return a portion of our excess cash flows to shareholders Cents Per Share 0.18 0.15 0.12 0.09 0.06 0.03 0 1999 Paid Paid Paid Paid Paid Payable Nov. 8, 2000 Nov. 6, 2001 Nov. 5, 2002 Nov. 6, 2003 Nov. 4, 2004 Oct. 5, 2005 $0.05 $0
Slide 30: Mission Statement
MGP Ingredients, Inc. Mission Statement To provide our customers with superior value-added ingredients derived from natural sources.
Slide 31: Mission Statement
MGP Mission Statement To provide our customers with superior value-added ingredients derived from natural sources.
Slide 32: MGP Ingredients, Inc.
MGP INGREDIENTS, INc.
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