HEALDSBURG, Calif.,
Sept. 21, 2016 /PRNewswire/ --
Truett-Hurst, Inc. (NASDAQ: THST), which operates an innovative and
fast growing super-premium and ultra-premium wine sales, marketing
and production company based in the acclaimed Dry Creek and Russian
River Valleys of Sonoma County, California, reported results
for the fiscal year 2016 which ended on June
30, 2016.
FY16 vs. FY15
For the fiscal year 2016, total net sales from continuing
operations totaled $25.8 million, an
increase of 19.1% compared to the same period in the prior
year. Consolidated gross margin from continuing operations
was 32.1%, an increase of 2.3% over the prior year.
Wholesale
- Net Sales of $20.0 million
(+19.1% or $3.2 million) (prior year
impacted by $0.6 million of Paperboy
related items)
- Gross Margin of 22.8% (an increase of 2.7 margin points) (prior
year impacted by $0.8 million of
Paperboy related items and $0.6
million of California Winecraft related items)
- Gross Profit of $4.6 million
(+$1.2 million)
Direct to Consumer (DTC)
- Net Sales of $5.8 million (+19.3%
or $0.9 million)
- Gross Margin of 64.6% (an increase of 1.1 margin points)
- Gross Profit of $3.7 million
(+$0.7 million)
Operating Expenses:
Operating expenses for the fiscal year ended June 30, 2016 were $8.4
million compared to $8.3
million in the same period in the prior year.
"As we continue to focus our wholesale efforts on our top 5
private label customers, I am pleased with our overall net sales
increase over the last twelve months," commented Phillip L. Hurst, Truett-Hurst, Inc.'s President
and CEO.
Earnings Call
Truett-Hurst, Inc.'s management will host a conference call
today, September 21, 2016, at
1:30 p.m. PT (4:30 p.m. ET) to discuss the Company's financial
results. To listen to the conference call, dial in
approximately ten minutes before the scheduled call to
1.888.347.6082 or international at 1.412.902.4286 and request
Truett-Hurst, Inc.'s Fiscal Year 2016 Results Call, or visit our
webcast link:
https://www.webcaster4.com/Webcast/Page/1132/17323.
A supporting presentation, in advance of the conference call,
will be available at:
http://www.truetthurstinc.com
To listen to a replay of the call, dial US Toll Free:
1.877.344.7529 or International Toll: 1.412.317.0088 and enter the
replay access code 10092867. The call will be available one
hour after the end of the conference call through September 28, 2016 at 9:00
am ET.
About Truett-Hurst, Inc.
Truett-Hurst, Inc. (NASDAQ: THST, www.truetthurstinc.com) is a
holding company and its sole asset is the controlling equity
interest in H.D.D. LLC., an innovative and fast-growing
super-premium, ultra-premium and luxury wine sales, marketing and
production company based in the acclaimed Dry Creek and Russian
River Valleys of Sonoma County, California. Truett-Hurst, Inc.
is headquartered in Healdsburg,
California.
Forward-Looking Statements
This press release and our earnings conference call for the
fiscal year ended June 30, 2016
contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Exchange Act of 1934, as amended, that are made as of the date of
this press release based upon our current expectations. All
statements, other than statements of historical fact, regarding our
strategy, future operations, financial position, estimated revenue,
projected costs, prospects, plans, opportunities, and objectives
constitute "forward-looking statements." The words "may,"
"will," "expect," "intend," "plan," "anticipate," "believe,"
"estimate," "potential" or "continue" and similar types of
expressions identify such statements, although not all
forward-looking statements contain these identifying words.
Such forward-looking statements include expectations regarding
revenue, income, and expenses for the periods after June 30, 2016. These forward-looking
statements involve known and unknown risks, uncertainties and other
factors that may cause the actual results to differ materially from
any future results, performance or achievements expressed or
implied by such forward-looking statements. Important factors
that could cause such differences include, but are not limited to,
a reduction in the supply of grapes and bulk wine available to us;
significant competition; any change in our relationships with
retailers which could harm our business; we may not achieve or
maintain profitability in the future; the loss of key employees; a
reduction in our access to, or an increase in the cost of, the
third-party services we use to produce our wine; credit facility
restrictions on our current and future operations; failure to
protect, or infringement of, trademarks and proprietary rights;
these factors should not be construed as exhaustive and should be
read in conjunction with the other cautionary statements that are
included in this report. For additional information, see our
Annual Report on Form 10-K expected to be filed on September 28, 2016, or our other reports
currently on file with the Securities and Exchange Commission,
which contain a more detailed discussion of risks and uncertainties
that may affect future results. We undertake no obligation to
publicly update or review any forward-looking statement, whether as
a result of new information, future developments or otherwise.
|
TRUETT-HURST, INC.
AND SUBSIDIARY
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
June 30,
2016
|
|
June 30,
2015
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
4,043
|
$
|
1,578
|
|
Accounts
receivable
|
|
2,678
|
|
2,783
|
|
Inventories,
net
|
|
19,918
|
|
22,080
|
|
Bulk wine
deposits
|
|
271
|
|
345
|
|
Assets held for
sale
|
|
-
|
|
173
|
|
Other current
assets
|
|
125
|
|
311
|
|
Total current
assets
|
|
27,035
|
|
27,270
|
|
|
|
|
|
|
Property and
equipment, net
|
|
5,583
|
|
5,743
|
|
Intangible assets,
net
|
|
496
|
|
482
|
|
Other assets,
net
|
|
391
|
|
408
|
|
Total
assets
|
$
|
33,505
|
$
|
33,903
|
|
Liabilities and
Equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Lines of
credit
|
$
|
10,311
|
$
|
9,034
|
|
Accounts
payable
|
|
1,351
|
|
2,889
|
|
Accrued
expenses
|
|
795
|
|
643
|
|
Depletion
allowance
|
|
610
|
|
524
|
|
Accrual for sales
returns
|
|
528
|
|
524
|
|
Due to related
parties
|
|
-
|
|
134
|
|
Liabilities held for
sale
|
|
-
|
|
140
|
|
Current maturities of
long term debt
|
|
475
|
|
368
|
|
Total current
liabilities
|
|
14,070
|
|
14,256
|
|
|
|
|
|
|
Deferred rent
liability
|
|
25
|
|
26
|
|
Long term debt, net
of current maturities
|
|
3,189
|
|
3,272
|
|
Total
liabilities
|
|
17,284
|
|
17,554
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
Preferred stock, par
value of $0.001 per share, 5,000,000 shares authorized,
none issued and outstanding at June 30,
2016 and June 30, 2015
|
|
|
|
|
|
-
|
|
-
|
|
Class A common stock,
par value of $0.001 per share, 15,000,000 authorized,
4,306,609 issued and outstanding at June
30, 2016 and 4,010,120 issued and outstanding at June 30,
2015
|
|
|
|
|
|
4
|
|
4
|
|
Class B common stock,
par value of $0.001 per share, 1,000 authorized, 7 and 8
issued and outstanding at June 30, 2016
and June 30, 2015, respectively
|
|
|
|
|
|
-
|
|
-
|
|
Additional paid-in
capital
|
|
15,794
|
|
14,618
|
|
Accumulated
deficit
|
|
(5,600)
|
|
(5,356)
|
|
Total
Truett-Hurst, Inc. equity
|
|
10,198
|
|
9,266
|
|
Noncontrolling
interest
|
|
6,023
|
|
7,083
|
|
Total
equity
|
|
16,221
|
|
16,349
|
|
Total liabilities and
equity
|
$
|
33,505
|
$
|
33,903
|
|
TRUETT-HURST, INC.
AND SUBSIDIARY
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
(In thousands,
except per share data)
|
|
|
|
|
|
Fiscal Year
Ended
|
|
|
June
30,
|
|
|
2016
|
|
2015
|
|
Sales
|
$
|
26,517
|
$
|
22,396
|
|
Less excise
tax
|
|
(734)
|
|
(754)
|
|
Net sales
|
|
25,783
|
|
21,642
|
|
|
|
|
|
|
Cost of
sales
|
|
17,496
|
|
15,192
|
|
|
|
|
|
|
Gross
profit
|
|
8,287
|
|
6,450
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
Sales and
marketing
|
|
5,286
|
|
4,991
|
|
General and
administrative
|
|
3,062
|
|
3,222
|
|
Impairment of other
assets
|
|
-
|
|
112
|
|
Loss on disposal
of assets
|
|
17
|
|
12
|
|
Total operating
expenses
|
|
8,365
|
|
8,337
|
|
Net loss from
operations
|
|
(78)
|
|
(1,887)
|
|
Other income
(expense):
|
|
|
|
|
|
Interest expense,
net
|
|
(317)
|
|
(286)
|
|
Other
expense
|
|
(151)
|
|
(111)
|
|
Total other
expense, net
|
|
(468)
|
|
(397)
|
|
Net loss before
income taxes
|
|
(546)
|
|
(2,284)
|
|
Income tax
expense
|
|
(2)
|
|
(2)
|
|
Net loss from
continuing operations
|
|
(548)
|
|
(2,286)
|
|
Income (loss) from
discontinued operations, net of tax
|
|
45
|
|
(162)
|
|
Net loss attributable
to Truett-Hurst, Inc. and H.D.D. LLC
|
|
(503)
|
|
(2,448)
|
|
Net loss attributable
to noncontrolling interest: H.D.D. LLC
|
|
(259)
|
|
(1,087)
|
|
Net loss attributable
to Truett-Hurst, Inc.
|
$
|
(244)
|
$
|
(1,361)
|
|
|
|
|
|
|
Net loss per
share:
|
|
|
|
|
|
Basic and diluted per
share
|
$
|
(0.06)
|
$
|
(0.35)
|
|
|
|
|
|
|
Weighted average
shares used in computing net loss per share:
|
|
|
|
|
|
Basic and diluted
weighted average shares
|
|
4,155,151
|
|
3,862,214
|
|
TRUETT-HURST, INC.
AND SUBSIDIARY
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
(In
thousands)
|
|
|
|
Fiscal Year
Ended
|
|
June
30,
|
|
|
2016
|
|
2015
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
Net loss
|
$
|
(503)
|
$
|
(2,448)
|
|
(Income) loss from
discontinued operations, net of tax
|
|
(45)
|
|
162
|
|
Net loss from
continuing operations
|
|
(548)
|
|
(2,286)
|
|
Adjustments to
reconcile net loss to net cash provided by (used in) operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
|
707
|
|
583
|
|
Stock-based
compensation
|
|
375
|
|
561
|
|
Reserve for obsolesce
of inventories
|
|
-
|
|
623
|
|
Impairment of other
assets
|
|
-
|
|
112
|
|
Deferred
rent
|
|
(1)
|
|
(22)
|
|
Loss on fair value of
interest rate swap
|
|
143
|
|
46
|
|
Loss on disposal of
assets
|
|
17
|
|
12
|
|
|
|
|
|
|
Changes in
operating assets and liabilities, net
|
|
|
|
|
|
Accounts
receivable
|
|
105
|
|
510
|
|
Inventories
|
|
2,162
|
|
(5,570)
|
|
Bulk wine
deposits
|
|
74
|
|
1,079
|
|
Other current
assets
|
|
166
|
|
(201)
|
|
Accounts
payable
|
|
(1,538)
|
|
377
|
|
Accrued
expenses
|
|
29
|
|
263
|
|
Depletion
allowance
|
|
86
|
|
496
|
|
Accrual for sales
returns
|
|
4
|
|
524
|
|
Due to related
parties
|
|
(134)
|
|
11
|
|
Net cash provided by
net operating assets and liabilities of discontinued
operations
|
|
78
|
|
83
|
|
Net cash provided by
(used in) operating activities
|
|
1,725
|
|
(2,799)
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
Acquisition of
property and equipment
|
|
(428)
|
|
(681)
|
|
Acquisition of
intangible and other assets
|
|
(137)
|
|
(321)
|
|
Proceeds from sale of
assets
|
|
4
|
|
3
|
|
Net cash used in
investing activities
|
|
(561)
|
|
(999)
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
Net proceeds from line
of credit
|
|
1,277
|
|
349
|
|
Proceeds from long
term debt
|
|
500
|
|
-
|
|
Payments on long term
debt
|
|
(476)
|
|
(333)
|
|
Net cash provided by
financing activities
|
|
1,301
|
|
16
|
|
|
|
|
|
|
Net change in cash
and cash equivalents
|
|
2,465
|
|
(3,782)
|
|
Cash and
cash equivalents at beginning of year
|
|
1,578
|
|
5,360
|
|
Cash and cash
equivalents at end of year
|
$
|
4,043
|
$
|
1,578
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
|
Cash paid for
interest
|
$
|
324
|
$
|
258
|
|
Cash paid for income
taxes
|
$
|
1
|
$
|
2
|
|
|
|
|
|
|
For more information,
contact:
Truett-Hurst, Inc.
Paul
Forgue,
Chief Financial Officer & Chief Operations
Officer
Phone:
707.431.4423
Fax:
707.395.0289
Email: paul@truetthurst.com
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SOURCE Truett-Hurst, Inc.