EXHIBIT 99 PRESS RELEASE
Published on
Exhibit 99
FOR IMMEDIATE RELEASE: MIDWEST GRAIN SHOWS FIRST QUARTER EARNINGS INCREASE
ATCHISON, Kan., November 10, 1999--Results released today by Midwest Grain
Products, Inc. show that the company's earnings for the first quarter of fiscal
2000 rose slightly above the same period the prior year and were up
substantially over the fourth quarter of fiscal 1999.
The company had net income of $751,000, or 8 cents per share, on sales of
$54,975,000 for the current year's first quarter, which ended Sept. 30. That
compares to last year's first quarter net income of $666,000, or 7 cents per
share, on sales of $51,938,000, and marks a sizeable turnaround compared to the
net loss of $1,059,000 that was incurred in the final quarter of fiscal 1999.
"While our profitability in this year's first quarter was just above the
level we reached during the same period a year ago, we have come a long way
since the start of fiscal 2000," said Ladd Seaberg, president and chief
executive officer. "Furthermore," he added, "we currently are experiencing
strong indications of more significant improvements to our bottom line,
principally as the result of increased growth in our specialty and modified
wheat starch and wheat protein markets, together with improved operational
efficiencies."
The increase in first quarter earnings compared to a year ago resulted
principally from the effects of increased demand for the company's vital wheat
gluten, specialty wheat proteins and wheat starches combined with lower raw
material costs for grain, according to Seaberg. These factors partially offset
the impact of reduced selling prices for the company's alcohol products, a
situation resulting from the continuation of excess supplies throughout the
industry, he noted.
"The realization of even greater demand for our wheat gluten in the first
quarter was prevented by a huge wave of gluten imports from the European Union
(E.U.) just prior to the start of the quarter," Seaberg said. He explained that
during the month of June, 1999, which marked the opening of the second year of a
three-year annual quota on imports of foreign gluten, the E.U.'s entire
allocation of 45 million pounds entered the United States market. "This lowered
our potential to increase gluten sales more rapidly in the first quarter," he
said. "However, conditions allowing us to strengthen our presence in the gluten
market during much of the remainder of fiscal 2000 should materialize," he
added.
Seaberg reiterated that the company also expects to realize continued
growth in sales of its specialty wheat proteins and specialty and modified wheat
starches, which are produced and marketed for use in a variety of value-added
food and non-food applications. The company currently is completing the
installation of additional equipment at its Atchison, Kansas plant to increase
wheat starch production capacity. Work is also underway at the Atchison plant to
enhance the company's alcohol distillation process and further improve alcohol
production cost efficiencies. This project is expected to be completed by the
end of fiscal 2000.
This 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 and actions of
governments. Any changes in the assumptions or factors could produce materially
different results than those predicted and could impact stock values.
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