MGP Ingredients Inc. (NASDAQ:MGPI) Q3 2019 Earnings Conference Call - Final Transcript
Oct 31, 2019 • 10:00 am ET
Good day and welcome to the MGP Ingredients Conference Call and Webcast. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions]
I would now like to turn the conference over to Mike Houston, Investor Relations. Please go ahead.
Thank you, Chantelle. Good morning, everyone, and thank you for joining the MGP Ingredients conference call and webcast to discuss the Company's financial results for the third quarter 2019. I'm Mike Houston with Lambert & Co., MGP's Investor Relations firm. And joining me today are members of their management team, including Gus Griffin, President and Chief Executive Officer; and Brandon Gall, Vice President of Finance and Chief Financial Officer.
We will begin the call with management's prepared remarks, and then open the call up to questions. However, before we begin today's call, it is my responsibility to inform you that this call may involve certain forward-looking statements, such as projections of sales, operating income, gross margin, and effective tax rate, as well as statements on the plans and objectives of the Company's business.
The Company's actual results could differ materially from any forward-looking statements made today due to a number of factors, including the risk factors described in the Company's most recent annual and quarterly reports filed with the Securities and Exchange Commission. The Company assumes no obligation to update any forward-looking statements made during the call. If anybody does not already have a copy of the press release issued by MGP today, you can access it at the Company's website, www.mgpingredients.com.
At this time, I would like to turn the call over to MGP's President and Chief Executive Officer, Gus Griffin. Gus?
Thank you, Mike, and thank you all for joining us. On this call we will provide an overview of our results for the quarter, updates on key financial performance metrics, and a discussion of progress against our strategy. Then we will take your questions.
Now I will return to the results for the third quarter. While the overall American whiskey market remains robust and our position within that market is still very strong, timing and volatility of customers' orders continue to be a challenge this year. As in previous quarters, this year we saw forecasted orders delayed due to customer funding issues and their desire to divide purchasing as long as possible. These issues have affected sales of both new distillate and aged whiskey inventory throughout the year. Despite this, we did have a very strong quarter for sales of aged whiskey, selling both more whiskey and older whiskey, as customers continue to need our inventory to launch new brands, fill holes in their inventory, and support brand acquisitions. We believe these customer needs will be ongoing. While we are behind where we'd like to be at this point in the year, we're off to a strong start to the fourth quarter, and we are confident in our line of sight to sales required to deliver against our full-year guidance.
Looking at each segment