MGP Ingredients : Investor Presentation - May 2024

INVESTOR PRESENTATION

First Quarter 2024

FORWARD LOOKING STATEMENTS AND NON-GAAP DISCLAIMER

This presentationmay containforward-looking statements withinthe meaning of the Private Securities LitigationReform Act of 1995, including without limitation statements regarding the prospects of the industries of MGP Ingredients, Inc. (the "Company" or "MGP"); the Company's prospects, plans, mission, strategies, capital allocation priorities, financial position, financial stability, growth opportunities, and strategic plan; U.S. Spirits and American Whiskey growth; cash flow; new distillate sales benefits, including ability to provide stability, sustainability, and cashflows; costs associated withthe Atchison distillery closure; value of whiskey inventory; and the Company's 2024 guidance, including its expectations for sales, adjusted EBITDA, adjusted basic earnings per common share, and shares outstanding. Forward looking statements are usuallyidentified by or are associated withwords suchas "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, Companyfinancial results, andCompanyfinancialconditionandare not guarantees of future performance.

All forward-looking statements are subject to risks and uncertainties that couldcause actual results to differ materially. Factors that couldcause actual results to differ materially from our expectations include without limitationanyeffects of changes in consumer preferences and purchases and our ability to anticipate or react to those changes; our ability to compete effectively; damage to our reputationor that of any of our key customers or their brands; failure to introduce successful new brands andproducts or have effective marketing oradvertising; changes in public opinionabout 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 quantityof maturing stock of our aged distillate; warehouse expansion issues; our reliance on a limited number of suppliers; our reliance on a limited number of suppliers; workdisruptions or stoppages; climate change andmeasures to address climate change; our closure of our Atchison, Kansas distillery; regulation and taxationand compliance with existing or future laws andregulations; tariffs, trade relations, and trade policies; excise taxes, incentives andcustoms duties; our abilityto protect our intellectual propertyrights and defend against alleged intellectualproperty rights infringement claims; failure to secure andmaintain listings in control states; labeling or warning requirements or limitations on the availability of our products; product recalls or other product liability claims; anti-corruptionlaws, trade sanctions and restrictions; class action or other litigation; higher costs or the unavailabilityandcost of raw materials, product ingredients, energy resources, or labor; failure of our informationtechnology systems, networks, processes, associated sites, or service providers; acquisitions andpotential future acquisitions; interest rate increases; reliance on key personnel; commercial, political, andfinancialrisks; covenants and other provisions inour credit arrangements; pandemics or other healthcrises; ability to pay any dividends; limited rights of commonstockholders and antitakeover provisions inour governing documents; the impact of issuing shares of our common stock; andthe effectiveness or executionof our strategic plan. For further information on these risks and uncertainties andother factors that could affect the Company's business, see the "Risk Factors" and "Management's Discussion and Analysis of FinancialCondition and Results of Operations" sections of the Company's AnnualReport on Form 10-K for the year ended December 31, 2023 and its Quarterly Report on Form 10-Q for the quarter ended March31, 2024, as well as the Company's other SEC filings. The Companyundertakes no obligation to update any forward-looking statements or information inthis presentation, except as requiredby law.

Non-GAAP Financial Measures

In addition to providing financial information inaccordance withU.S. GAAP, the Company provides certainnon-GAAP financial measures that are not in accordance with, or alternatives for, GAAP. In addition to the comparable GAAP measures, the Companyhas disclosed adjusted gross profit, adjusted operating income, adjusted net income, adjusted EBITDA, adjusted EBITDA less capital expenditures, and adjusted basic anddiluted EPS, as well as guidance for adjusted EBITDA and adjusted basic EPS. The presentation of these non-GAAP financial measures shouldbe reviewed in conjunction with grossprofit, operating income, net income, capital expenditures, and basic and diluted EPS computed in accordance with U.S. GAAP and should not be considereda substitute for the GAAP measure. We believe that the non-GAAP measures provide useful informationto investors regarding the Company's performance andoverallresults of operations. In addition, management uses these non-GAAP measures in conjunction with GAAP measures when evaluating the Company's operating results comparedto prior periods on a consistent basis, assessing financial trends andfor forecasting purposes. Non-GAAP financial measures maynot provide information that is directly comparable to other companies, even if similar terms are used to identifysuchmeasures. The appendix provide a full reconciliationof historicalnon-GAAP financial measures to the most directly comparable U.S. GAAP financialmeasure. Full year 2024 guidance measures of adjusted EBITDA and adjusted basic EPS are providedon a non-GAAP basis without a reconciliation to the most directlycomparable GAAP measures because the Company is unable to predict with a reasonable degree of certainty certainitems contained inthe GAAP measures without unreasonable efforts. Such items include without limitation, acquisition related expenses, restructuring andrelated expenses, andother items not reflective of the Company's ongoing operations.

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NASDAQ:MGPI

MISSION STATEMENT

Secure our future by consistently delivering superior financial results by more fully participating in all levels of the alcohol, spirits and food ingredients segments for the betterment of our shareholders, employees, partners, consumers and communities.

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MGP OVERVIEW

Total sales were $837MM for the year ended December 31, 2023

DISTILLING

SOLUTIONS

Sales: $451MM

(54% of Total)

GP Margin: 32.2%

• Leading supplier of distilled spirits, facilitating the creation of bourbons, rye whiskeys, American single malt whiskey, distilled gins, and grain neutral spirits ("GNS")
• Shifting business mix towards higher margin opportunities as a supplier to our increasingly diverse range of customers
• Capacity and capability provide key competitive advantage

BRANDED

SPIRITS

Sales: $254MM

(30% of Total)

GP Margin : 44.4%

• Attractive and growing portfolio of spirit brands in fastest growing categories
• Branded Spirits segment provides a platform for both organic and acquisitive growth opportunities
• Award winning premium plus brands offer a significant long-term upside
• Diversified mid and value portfolio positioned at affordable price points and provides stable cash flows

INGREDIENT

SOLUTIONS

Sales: $132MM

(16% of Total)

GP Margin: 35.7%

• Leading U.S. producer of specialty wheat proteins and starches
• Rapidly growing category with significant long-term upside
• Aligned with several important consumer trends (e.g. plant based high protein foods, and lower net carbohydrate foods)
• MGP's history affords unique know- how in the specialty ingredient category, and we are widely regarded as experts in the industry

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DISTILLING SOLUTIONS

A LEADING SUPPLIER OF DISTILLED SPIRITS TO THIRD PARTIES

2023 Total Revenue of $451MM

$29

$133

$289

Brown Goods

White Goods and Other Co-Products

Warehouse Services

Historical Gross Profit and Margin (%)

			$145
			$126
$114
32.4%	32.2%
$76			29.5%

$64

24.2%

21.9%

5	2019	2020	2021	2022	2023

Products consist of the following:

• Brown Goods: Premium bourbon, rye and other whiskeys sold as aged whiskey or unaged new distillate, which is then aged by customers from two to four years on average
• Warehouse Services: Services related primarily to customer storage of Brown Goods product for aging
• White Goods and Other Co-Products: Primarily GNS, including vodka and gin, as well as industrial alcohol, fuel grade alcohol and distillers feed and related co-products

Diversified customer base supporting more than840 new distillate and aged customers as of December 31, 2023

Compete on product innovation, product characteristics, functionality, price, service, and quality factors,like flavor

Note: All figures in millions. Amounts may not foot due to rounding. Distilling Solutions segment results are exclusive of Branded Spirits segment results

DISTILLING SOLUTIONS

UNIQUE EXPERTISE POSITIONS US AS THE PREFERRED PARTNER TO OUR CUSTOMERS

Scale provides competitive pricing Capacity supports long-term growth

Capabilities to meet diverse customer needs - multiple mash bills; blending to achieve multiple flavor profiles

Flexibility to shift between various offerings Library of different mash bills and ages Broad base of premium beverage offerings Long term stability with new distillate

Leveraging aged whiskey to retain and attract new customers Partnership approach to our core business

Unique expertise in producing American whiskey

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Lawrenceburg, IN Operations

• Ross & Squibb Distillery
• • Top-5American Whiskey producer
  • One of the largest U.S. suppliers of rye whiskey
  • Bourbon
  • American Single Malt Whiskey
  • Gin & Grain Neutral Spirits/Vodka
• Whiskey aging warehouses
• Research & Development

Bardstown, KY Operations

• Lux Row Distillery
• • Over 18,000 square foot facility
  • Expansionary capital investments in recent years
  • Producer of Kentucky Straight Bourbon Whiskey
• Whiskey aging warehouses

AGED WHISKEY CUSTOMER ECONOMIC BENEFITS

• Shortens timeline to cash flow
• Brand launches can occur in weeks rather than years
• Reduces working capital investment
• No need to build additional distillation capacity or warehouses
• Enables M&A-related growth and brand expansion
• Provides a reliable long-term supply chain solution

DISTILLING SOLUTIONS

WELL POSITIONED TO CONTINUE BENEFITTING FROM GROWTH IN U.S. SPIRITS - PRIMARILY AMERICAN WHISKEY

U.S. Spirits Continue To Gain Share Of Total Beverage Alcohol

	Beverage Alcohol Market Share - Revenue
48.3%		Beer	Spirits	Wine
				42.2%
34.7%
				41.8%
17.0%					16.1%
2013	2015	2017	2019	2021	2023

• Total distilled spirits have experienced 14 straight years of market share gains in the U.S.
• • 2023 volume up 1.2% vs. 2022 to 309M cases
  • 2023 revenues up 0.2% vs. 2022 to $37.7B
• Premiumization trends across categories continued to drive U.S. volume growth for high end and super premium brands in 2023 vs. 2022

•	Super Premium American Whiskey	+4.0%
•	Rye Whiskey	+8.6% (2)
•	Super Premium Gin	+16.0%

American Whiskey Remains Strong

	5-year U.S. American Whiskey Volume CAGR
		6.3%	6.5%	6.3%	6.5%	6.9%	6.4%	6.2%
	5.7%
5.1%							4.9%

3.7%

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

• 2023 volume was slightly down 0.4% vs. 2022 to 31.1M cases, revenues up

	3.8% vs. 2022 to $5.3B
			9-LTR Case Volume	1970	2010	2023
•	Historical length of trends in	American Whiskey	35.6M	15.3M	31.1M
	the U.S. indicates sustainable	Vodka	18.8M	62.1M	74.9M
	Tequila	0.4M	11.6M	31.6M
	growth opportunities
		Amer. Whiskey Metrics	1970	2010	2023
•	Significant headroom for		9-LTR Case Volume	35.6M	15.3M	31.1M
Per Capita Consumption	0.69	0.16	0.30
	additional American Whiskey
	LDA Population	122M	221M	249M(1)
	growth in the U.S.
	Share of TDS	22.8%	8.0%	10.1%

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Note: Data sourced from Distilled Spirits Council Annual Economic Briefing Report - 2023

1. The LDA population for 2023 is an estimate provided by Distilled Spirits Council
2. The Rye Whiskey growth is comparing 2022 vs. 2021

DISTILLING SOLUTIONS

FOUR STRATEGIES TO CONTINUE DELIVERING LONG-TERM GROWTH WITHIN THE DISTILLING SOLUTIONS SEGMENT

Distilling Solutions Growth Strategy

1. Further develop our existing customer relationships
2. Expand our Kentucky whiskey sales platform
3. Cultivate additional multi-national and craft customers for brown goods sales
4. Increase our global presence in the American whiskey market

American Whiskey is Underdeveloped Outside U.S.

• Exports expected to be a key driver of long-term growth, particularly in the European Union
• As a result of the tariff suspension, American Whiskey exports to the EU increased 29% in 2022 compared to 2021, reaching $566 million in 2022. (1)

1. This accounts for 44% of all American Whiskey exports, surpassing the pre-tariff level of $518 million in 2017. (1)

8	(1) Data sourced from Distilled Spirits Council

DISTILLING SOLUTIONS

CUSTOMER EVOLUTION INTO NEW DISTILLATE PROVIDES LONG-TERM STABILITY AND SUSTAINABILITY

New Distillate Sales Benefits

1. Attractive gross margin profile
2. Typically made to customers whose brands are more sizeable and reliable
3. Are the "end goal" for customers that start out purchasing aged whiskey - enhancing the long-term relationship with our customers
4. Are contracted for multi-year periods providing excellent visibility - expected ~90% of sales volume committed in 2024
5. Anticipated to provide strong cash flow that will be reinvested into the business

Brown Goods Revenue & Majority Type

(Dollars are in '000's)

$289,191

$229,523

$162,074

$121,384

FY20		FY21		FY22	FY23
		New Distillate - Majority		Aged - Majority

9	Note: Distilling Solutions segment results are exclusive of Branded Spirits segment results.

DISTILLING SOLUTIONS

PROGRESS OF "BROWN GOODS FOCUS" STRATEGY, CLOSURE OF ATCHISON DISTILLERY

• Due to their lower relative gross margin profiles, white goods and industrial alcohol sales have been de-emphasized in recent years.
• Beginning in 2022, as a result of increased supply into the market following COVID and the continued high corn basis values in the Atchison, KS region, gross margins turned negative for these product lines in Atchison, KS.
• In response, on July 13, 2023, the Company announced the planned closure of its Atchison distillery. The Atchison distillery ceased operations in December 2023, which accelerated our focus on brown goods.

Brown Goods as a Percentage of Total Segment Sales

and Distilling Solutions Gross Margin

																					22%		45.0%
																						40.0%
					54%								36%				40.2%
						46%						35.0%
61%
																						30.0%
	32.4%								32.2%
									29.5%
																								25.0%
	24.2%
																							20.0%
																					78%
																64%			15.0%
										54%
39%	46%														10.0%
																						5.0%
																											0.0%
2020	2021		2022		2023			Q1 2024
				Brown Goods Sales			Other Distilling Solutions Sales							Distilling Solutions Gross Margin

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