MGP Ingredients Inc (MGPI)

Days of inventory on hand (DOH)

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020
Inventory turnover		1.14	1.18	1.35	1.46	1.53	1.55	1.55	1.74	1.83	1.87	1.81	1.83	1.74	1.60	1.48	2.18	2.10	2.09	1.97	2.03
DOH	days	319.20	308.21	270.82	250.52	238.06	235.87	235.11	209.80	199.88	195.10	202.17	199.36	209.86	228.16	247.10	167.32	173.46	174.65	184.82	179.92

December 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 1.14
= 319.20

The days of inventory on hand (DOH) for MGP Ingredients Inc have exhibited fluctuations over the past few years. The DOH was relatively stable in the range of 170 to 180 days from March 2020 to December 2021, indicating the company maintained inventory levels that could support its sales for approximately 6 to 9 months.

However, there was a significant increase in DOH from June 2021 to December 2024, with the DOH reaching as high as 319.20 days by December 2024. This suggests that MGP Ingredients Inc may have been holding excess inventory relative to its sales volume during this period. A high DOH value can indicate inefficiencies in inventory management, tying up capital in unsold goods and potentially leading to increased storage costs and obsolescence risks.

It would be important for MGP Ingredients Inc to closely monitor and manage its inventory levels to ensure they are aligned with demand to optimize working capital and improve overall operational efficiency. Regular review of inventory turnover ratios and comparison with industry benchmarks could help the company optimize its inventory management practices and enhance its financial performance.