SECURITIES AND EXCHANGE COMMISSION

 

Washington, D.C.  20549

 

FORM 10-Q

 

QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934

 

For Quarter Ended March 31, 2003 - Commission File No. 0-17196

 

MGP INGREDIENTS, INC.
(Exact Name of Registrant as Specified in Its Charter)

 

 

1300 Main Street, Atchison, Kansas    66002

(Address of Principal Executive Offices and Zip Code)

 

(913) 367-1480

(Registrant’s Telephone Number, Including Area Code)

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to the filing requirements for at least the past 90 days.

ý   YES  o   NO

 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

o   YES  ý   NO

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

Common stock, no par value
7,795,068 shares outstanding
as of March 31, 2004

 

 

INDEX

 

			Page
PART I.  FINANCIAL INFORMATION
	Item 1.	Financial Statements
		Independent Accountants’ Review Report	1
		Condensed Consolidated Balance Sheets as of March 31, 2004 and June 30, 2003	2
		Condensed Consolidated Statements of Income for the Three Months Ended and the Nine Months Ended March 31, 2004 and 2003	4
		Condensed Consolidated Statements of Cash Flows for the Nine Months Ended March 31, 2004 and 2003	5
		Notes to Condensed Consolidated Financial Statements	6
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	18
	Item 4.	Controls and Procedures	18
PART II.  OTHER INFORMATION
	Item 1.	Legal Proceedings	18
	Item 6.	Exhibits and Reports on Form 8-K	20

 

 

Independent Accountants’ Report

 

Board of Directors and Stockholders

MGP Ingredients, Inc.

Atchison, Kansas   66002

 

We have reviewed the accompanying condensed consolidated balance sheet of MGP Ingredients, Inc. as of March 31, 2004 and the related condensed consolidated statements of income for the three-month and nine-month periods ended March 31, 2004 and 2003 and the related condensed consolidated statements of cash flows for the nine-month periods ended March 31, 2004 and 2003.  These financial statements are the responsibility of the Company’s management.

 

We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants.  A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters.  It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole.  Accordingly, we do not express such an opinion.

 

Based on our reviews, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with generally accepted accounting principles.

 

We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet as of June 30, 2003 and the related consolidated statements of income, retained earnings and cash flows for the year then ended (not presented herein), and in our report dated August 1, 2003, we expressed an unqualified opinion on those consolidated financial statements.  In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of June 30, 2003 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

 

	/s/ BKD, LLP
Kansas City, Missouri
May 4, 2004

 

1

 

MGP Ingredients, Inc.
Condensed Consolidated Balance Sheets

(in thousands)

 

Assets

 

		March 31, 2004			June 30, 2003
		(Unaudited)
Current Assets
Cash and cash equivalents		$	8,653		$	17,539
Receivables, net of allowance of $252 at March 31, 2004 and June 30, 2003		31,856			20,466
Inventories		30,045			26,956
Prepaid expenses		1,534			1,578
Income taxes receivable		949			3,086
Total current assets		73,037			69,625
Property and Equipment, at cost		287,533			263,990
Less accumulated depreciation		183,306			172,186
Total property and equipment, net		104,227			91,804
Other
Insurance receivable		4,861			11,515
Other assets		92			186
Total other assets		4,953			11,701
Total assets		$	182,217		$	173,130

 

See Accompanying Notes to Condensed Consolidated Financial Statements and Independent Accountants’ Review Report

 

2

 

Liabilities and Stockholders’ Equity

 

		March 31, 2004			June 30, 2003
		(Unaudited)
Current Liabilities
Current maturities of long-term debt		$	3,201		$	3,201
Accounts payable		13,193			9,729
Accrued expenses		4,905			3,604
Deferred income taxes		241			241
Deferred income		13,030			14,323
Total current liabilities		34,570			31,098
Long-Term Debt		12,262			15,232
Post-Retirement Benefits		5,963			5,780
Deferred Income Taxes		15,802			15,802
Stockholders’ Equity
Capital stock
Preferred, 5% cumulative, $10 par value; authorized 1,000 shares; issued and outstanding 437 shares		4			4
Common, no par; authorized 20,000,000 shares;  issued 9,765,172 shares		6,715			6,715
Additional paid-in capital		4,110			2,605
Retained earnings		120,016			114,861
Accumulated other comprehensive gain (loss) – Cash flow hedges		711			(50		)
		131,556			124,135
Treasury stock, at cost
Common
March 31, 2004 – 1,970,104 shares June 30, 2003 – 2,079,828 shares		(17,936		)	(18,917		)
		113,620			105,218
Total liabilities and stockholders’ equity		$	182,217		$	173,130

 

3

 

MGP Ingredients, Inc.

Condensed Consolidated Statements of Income

Three and Nine Months Ended March 31, 2004 and 2003
(Unaudited)

 

		Three Months						Nine Months
		2004			2003			2004			2003
		(in thousands)						(in thousands)