PRESS RELEASE WITH SELECTED 2Q FINANCIALS

CONTACT: Steve Pickman at 913-367-1480


FOR IMMEDIATE RELEASE: MGP INGREDIENTS REPORTS SECOND QUARTER RESULTS


ATCHISON, Kan., February 10, 2003--MGP Ingredients, Inc. (MGPI/Nasdaq)
today reported net income of $48,000, or 1 cent per common share, on sales of
$44,408,000 for the second quarter of fiscal 2003, which ended Dec. 31, 2002.
That compares to net income of $2,551,000, or 32 cents per share, on sales of
$54,394,000 for the same period the prior year. The company's earnings before
interest, taxes, depreciation and amortization was $3,918,000 in the current
year's second quarter compared to $8,149,000 in the second quarter of fiscal
2002.

For the first six months of fiscal 2003, MGPI had net income of $6,838,000,
or 85 cents per share, on sales of $87,307,000 versus net income of $4,995,000,
or 62 cents per share, on sales of $108,688,000 for the first six months of last
fiscal year. The company's earnings before interest, taxes, depreciation and
amortization in the first half of fiscal 2003 was $19,129,000 compared to
$16,115,000 in the first half of fiscal 2002.

The company "continues to be very solid financially," stated Ladd Seaberg,
president and chief executive officer, noting that MGPI has cash and cash
equivalents of $27 million, working capital of approximately $41 million and
stockholders' equity of approximately $109 million. "We have the financial
strength to pursue our planned program for growth, which presently has an
internal focus, but could include acquisitions as well," he added.

Business interruption insurance proceeds to compensate for the effects of
an explosion at the company's distillery operation in Atchison on Sept. 13, 2002
amounted to $5 million in the second quarter. "These proceeds make us
substantially whole from an operating income standpoint," Seaberg said. "While
the business interruption insurance helps make up for lost revenues from our
specialty ingredients business, the explosion did adversely affect our ability
to realize the kind of progress that we would have anticipated," he added.

Net income for the quarter was partially attributable to the receipt of
approximately $193,000 (net of income tax) during that period from a previously
announced United States Department of Agriculture (USDA) program to provide cash
incentives to ethanol producers. The company additionally benefited from
approximately $732,000 (net of income tax) for the quarter resulting from a USDA
program to support the development of products and markets for value-added wheat
proteins and wheat starches.

The earnings increase in the first six months of fiscal 2003 was
principally due to $13 million in non-operating income ($7.9 million net of
income tax) that resulted in the first quarter from the recognition of expected
insurance proceeds in excess of the net recorded costs of assets that were
destroyed in the distillery explosion. As previously reported, this more than
offset what otherwise would have been a first quarter net loss of $1,110,000. "I
am encouraged by the headway we have actually made in our operating performance
since the end of the first quarter," Seaberg said.

The decrease in second quarter sales compared to a year ago was due
partially to reduced sales of distillery products. This decline was mainly
attributable to lower alcohol production resulting from the slowdown of the
Atchison distillery following the Sept. 13th explosion. Selling prices for both
food grade alcohol and fuel grade alcohol, commonly known as ethanol, were also
lower compared to last year's second quarter. Seaberg noted, however, that
alcohol selling prices in both the food grade and fuel grade areas did
"experience improvements" in the second quarter compared to the first quarter of
fiscal 2003, and that "these improvements presently remain intact."

Due largely to reduced sales of commodity ingredients, which consist of
vital wheat gluten and commodity wheat starch, the company experienced a
decrease in second quarter ingredient sales. Sales of the company's specialty
ingredients, primarily specialty wheat proteins and starches, were modestly
lower than the prior year's second quarter level due to a decline in specialty
starch sales. Year to date, sales of specialty ingredients in the aggregate were
up slightly compared to the prior year's first six months. As indicated above,
growth in this area was limited by the effects of the distillery mishap.

As previously reported, because of the expiration of the wheat gluten quota
in June, 2001, the company has significantly reduced its production of vital
wheat gluten. This measure was taken in the face of greatly increased
competitive pressures from the European Union. At the same time, the company is
placing greater attention and resources on the development, production and
marketing of its specialty wheat proteins and starches for use in value-added
applications. "Our strategic objective is to significantly grow the value-added
area of our ingredients business, which at present is focused on serving
manufacturers of food, personal care and pet products," Seaberg said.

-more-

ADD 1--MGP INGREDIENTS REPORTS SECOND QUARTER


The USDA program to support value-added wheat protein and wheat starch
development, and which contributed to second quarter income as noted above, was
implemented in June, 2001. Administered by the USDA's Commodity Credit
Corporation, it was granted in lieu of an extended quota on imports of foreign
wheat gluten. Over the life of the program, which is scheduled to end May 31,
2003, MGP Ingredients is eligible for approximately $25.6 million of the program
total of $40 million. For the first 12 months of the program, approximately
$17.3 million was allocated to the company. The remaining $8.3 million was
allocated to the company in July, 2002. The funds must be used for capital,
research, marketing and promotional costs related to value-added wheat protein
and starch products. Funds received are recognized in income during the period
in which they are expended for a permitted purpose. However, funds that are used
for capital expenditure projects will be recognized in income over the periods
during which those projects are depreciated.

Approximately 75 percent of the program's funds for the two years combined
are expected to be used for capital projects and will be reflected in earnings
over the next seven to 10 years. These projects include a recent $8.3 million
expansion project at the company's Atchison plant. The expansion was completed
in November and involved the installation of additional processing and drying
equipment for the production of specialty wheat proteins for bakery, pasta and
noodle and related food markets, both domestic and foreign. The remaining 25
percent of the funds are being applied toward research and marketing-related
costs, and hence are reflected in earnings.

The USDA's incentive program for ethanol producers began in December, 2000
and extends through September, 2006. It was initiated to provide a cash
incentive for ethanol producers who increase their grain usage over comparable
quarters in the prior year to raise fuel alcohol production. Funding from the
program is determined on an annual basis. The company's eligibility to
participate in the program is determined from quarter to quarter. Due to the
reduced production resulting from the distillery slowdown in Atchison, the
company's eligibility through the remainder of fiscal 2003 is questionable.

As a result of the explosion, the company will be unable to produce
finished alcohol at the Atchison plant for an extended period. Because its
ingredient and alcohol production processes are integrated, the distillery
slowdown also has an effect on the company's ability to produce the base raw
material for specialty ingredients at this location. "While our ability to
supply spot alcohol business is substantially reduced at this time, production
capabilities at our Pekin, Ill., facility should continue to be adequate to
supply alcohol to regular customers. Additionally, our Illinois operation has
been able to help produce our base proteins and starches, which are then
transferred to the Atchison facility as raw material for producing our specialty
ingredients."

As previously announced, the company plans to return to full production at
the Atchison distillery. "In the meantime," Seaberg said, "our existing
production capabilities in Atchison currently are enabling us to produce
unfinished alcohol, the majority of which is being shipped to our Illinois plant
for further processing." Seaberg estimates that the total rebuilding process
could take between 10 and 11 months from now to complete. "The goal of this
process," he stated, "is to be able to efficiently make high quality, high
purity food grade alcohol at the Atchison location when the new equipment is
fully up and running."

Prices for grain, the company's principal raw material, remained above
levels experienced in last year's second quarter. "Grain prices currently are
lower compared to the second quarter, but we are seeing a modest upward movement
in energy costs due to increased natural gas prices," Seaberg reported. He added
that in such instances the company "fortunately is able to reduce the impact of
rising energy costs by making greater use of lower priced fuel oil to supply a
major portion of the Atchison plant's energy needs."


This news release contains forward-looking statements as well as historical
information. Forward-looking statements are identified by or are associated with
such words as "intend," "believe," "estimate," "expect," "anticipate,"
"hopeful," "should," "may" and similar expressions. They reflect management's
current beliefs and estimates of future economic circumstances, industry
conditions, company performance and financial results and are not guarantees of
future performance. The forward-looking statements are based on many assumptions
and factors, including those relating to grain prices, gasoline prices, energy
costs, product pricing, competitive environment and related marketing
conditions, operating efficiencies, access to capital, actions of governments or
government officials and actions of insurers. Any changes in the assumptions or
factors could produce materially different results than those predicted and
could impact stock values.
###
CONSOLIDATED STATEMENT OF EARNINGS
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
(unaudited) Three Months Ended December 31 Six Months Ended December 31
(Dollars in thousands, except per share) 2002 2001 2002 2001
- ------------------------------------------------------------------------------ ----------------------------
NET SALES $ 44,408 $ 54,394 $ 87,307 $ 108,688
COST OF SALES 46,903 47,500 89,625 94,804
------------------------------- ----------------------------
GROSS PROFIT (2,495) 6,894 (2,318) 13,884
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 3,406 3,548 6,727 7,699
OTHER OPERATING INCOME 6,171 (42) 7,694 (63)
------------------------------- ----------------------------
INCOME FROM OPERATIONS 270 3,304 (1,351) 6,122
OTHER INCOME (EXPENSE)
INTEREST (304) (355) (626) (749)
OTHER 113 1,268 13,279 2,884
------------------------------- ----------------------------
INCOME BEFORE INCOME TAXES 79 4,217 11,302 8,257
PROVISION FOR INCOME TAXES 31 1,666 4,464 3,262
------------------------------- ----------------------------
NET INCOME $ 48 $ 2,551 $ 6,838 $ 4,995
------------------------------- ----------------------------
BASIC AND DILUTED EARNINGS PER COMMON SHARE $ 0.01 $ .32 $ 0.85 $ 0.62
=============================== ============================
DIVIDENDS PER COMMON SHARE $ 0.15 $ 0.15
============================
Weighted average shares outstanding 8,026,920 8,070,712 8,049,165 8,118,018

</TABLE>


CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------
(unaudited) December 31 June 30 (unaudited) December 31 June 30
(Dollars in thousands) 2002 2002 (Dollars in thousands) 2002 2002
- ----------------------------------------------------------------------------------------------------------------------------
ASSETS LIABILITIES AND
STOCKHOLDERS' EQUITY
CURRENT ASSETS: CURRENT LIABILITIES:

Cash and cash equivalents $ 26,795 $ 24,045 Current maturities of long-term debt $ 3,202 $ 3,201
Investments 4,691 Accounts payable 10,378 8,681
Receivables 20,638 24,071 Accrued expenses 2,853 3,745
Inventories 23,162 20,755 Income Taxes Payable 1,887
Prepaid expenses 2,423 550 Deferred income 17,053 10,971

Deferred income taxes 397 284 --------------------
Refundable Income taxes 3,122 585 Total Current Liabilities $ 35,373 $ 26,598
-------------------
Total Current Assets 76,537 74,981
PROPERTY AND EQUIPMENT, At Cost 265,812 258,501
Less accumulated depreciation 174,679 167,486 LONG-TERM DEBT 15,695 18,433
-------------------
91,133 91,015 POST-RETIREMENT BENEFITS 5,895 5,921
Insurance Receivable 14,000 -- DEFERRED INCOME TAXES 15,688 10,588
OTHER ASSETS 3 222 STOCKHOLDERS' EQUITY 109,022 104,678
------------------- -------------------
$181,673 $ 166,218 $181,673 $166,218
=================== ===================

</TABLE>