Company to Host Conference Call at
5:00pm ET Today
PORTLAND, Ore., May 15, 2023
/PRNewswire/ -- Eastside Distilling, Inc. (NASDAQ: EAST)
("Eastside" or the "Company"), a
consumer-focused beverage company that builds craft inspired
experiential brands and high-quality artisan products around
premium spirits, digital can printing, co-packing and mobile
filling, reported first quarter end 2023 financial results for the
period ended March 31, 2023.
First Quarter 2023 Highlights:
- Craft C+P reports a +37% increase in sales from prior-year
quarter
- Craft C+P achieved a record number of cans printed in the
quarter - over 2.5 million cans in the quarter and reaffirmed
guidance of positive adjusted EBITDA for the Craft C+P segment
- Spirits achieved strong margins on bulk sales in the
quarter
- Net loss decreased over $0.4
million from prior-year quarter
- Announced a 1 for 20 reverse stock split to address one of two
Nasdaq compliance issues
"This quarter we made progress across the board in all segments
and businesses" said Geoffrey Gwin,
Eastside's CEO. "I expect
stronger results in the 2nd quarter of this year
excluding bulk barrel sales."
Financial Results
Gross sales for the three months ending March 31, 2023 decreased to $2.9 million from $3.8
million. Craft C+P sales increased due to digital
printing, offset by lower results in mobile canning business. For
the three months ending March 31,
2023 and 2022, the Company sold excess bulk spirits for
$0.6 million and $1.5 million, respectively.
Gross profit for the three months ending March 31, 2023 decreased to $0.6 million from $0.9
million for the three months ending March 31, 2022. Gross margin was 22% for the
three months ending March 31, 2023
and 25% for the three months ending March
31, 2022. Spirits margins increased primarily due to excess
bulk spirits sales.
Operating costs for the three months ending March 31, 2023 decreased to $1.9 million from $2.6
million for the three months ending March 31, 2022 primarily related to decreased
professional fees and compensation.
Net loss for the three months ending March 31, 2023 decreased to $1.6 million from $2.0
million for the three months ending March 31, 2022. The Company reported adjusted
EBITDA of $(0.7) million and
$(1.0) million for the three months
ending March 31, 2023 and 2022,
respectively. (See description of adjusted EBIDTA in "Use of
Non-GAAP Measures" below.)
During the first quarter, the Company delivered 5,941 cases of
spirits. Of that total, Portland Potato Vodka represented 4,000
cases. Azuñia volumes decreased due to two large inventory
distributor purchases in the first quarter of 2022. The following
table details cases delivered during the quarters ending
March 31, 2023 and 2022:
9 Liter
Cases
|
2023
|
2022
|
Change
|
%
|
Azuñia
|
1,013
|
2,059
|
(1,046)
|
-51 %
|
Portland Potato
Vodka
|
4,030
|
4,301
|
(271)
|
-6 %
|
Burnside
|
771
|
1,005
|
(235)
|
-23 %
|
Eastside
Brands
|
86
|
68
|
18
|
26 %
|
Hue-Hue
|
41
|
84
|
(43)
|
-51 %
|
Legacy
Brands
|
-
|
11
|
(11)
|
-100 %
|
|
5,941
|
7,528
|
(1,587)
|
-21 %
|
|
The Company will give further updates on its earnings
conference call.
Use of Non-GAAP Measures
Eastside Distilling's management evaluates and makes operating
decisions using various financial metrics. In addition to the
Company's GAAP results, management also considers the non-GAAP
measure of adjusted EBITDA as a supplement to GAAP results.
Management believes this non-GAAP measure provides useful
information about the Company's operating results and assists
investors in comparing the Company's performance across reporting
periods on a consistent basis by excluding items that it does not
believe are indicative of its core operating performance.
The Company defines adjusted EBITDA as earnings before interest,
taxes, depreciation and amortization, stock-based compensation, and
other one-time items. The table below provides a reconciliation of
this non-GAAP financial measure with the most directly comparable
GAAP financial measure.
First Quarter 2023 Conference Call Details
Date and Time: Monday, May 15,
2023 at 5:00pm ET
Call-in Information: Interested parties can access the
conference call by dialing (844) 889-4332 or (412) 717-9595.
Live Webcast Information: Interested parties can access
the conference call via a live Internet webcast, which is available
in the Conference Calls section of the Company's website at
https://www.eastsidedistilling.com/conference-calls.
Presentation Information: Slides relating to this
earnings release can be found on the Company's website in the
Events and Presentations section of the Investor page at
https://www.eastsidedistilling.com/events-and-presentations
Replay: A teleconference replay of the call will be
available for three days at (877) 344-7529 or (412) 317-0088,
replay access code #3471174. A webcast replay will be available in
the Conference Calls section of the Company's website at
https://www.eastsidedistilling.com/conference-calls for 90
days.
About Eastside Distilling
Eastside Distilling, Inc. (NASDAQ: EAST) has been producing
high-quality, award-winning craft spirits in Portland, Oregon, since 2008. The Company is
distinguished by its highly decorated product lineup that includes
Azuñia Tequilas®, Burnside Whiskeys®, Hue-Hue Coffee Rum®, and
Portland Potato Vodkas®. All Eastside spirits are crafted from natural
ingredients for quality and taste. Eastside's Craft Canning + Printing subsidiary
is one of the Northwest's leading independent mobile canning,
co-packing and digital can printing businesses.
Important Cautions Regarding Forward-Looking
Statements
Certain matters discussed in this press release may be
forward-looking statements that reflect our expectations or
anticipations rather than historical fact. Such matters involve
risks and uncertainties that may cause actual results to differ
materially, including the following: changes in economic
conditions, general competitive factors, the Company's ongoing
financing requirements and ability to achieve financing, acceptance
of the Company's products in the market, the Company's success in
obtaining new customers, the Company's ability to execute its
business model and strategic plans, and other risks and related
information described from time to time in the Company's filings
with the Securities and Exchange Commission ("SEC"). A detailed
discussion of the most significant risks can be found in the "Risk
Factors" section of the Company's Annual Report on Form 10-K. The
Company assumes no obligation to update the cautionary information
in this press release.
Financial Summary Tables
The following financial information should be read in
conjunction with the unaudited financial statements and
accompanying notes filed by the Company with the Securities and
Exchange Commission on Form 10-Q for the period ended March 31, 2023, which can be viewed at
www.sec.gov and in the investor relations section of the Company's
website at www.eastsidedistilling.com/investors.
Eastside Distilling,
Inc. and Subsidiaries
|
Consolidated Balance
Sheets
|
Dollars in
thousands, except share and per share
|
|
|
|
March 31,
2023
|
|
|
December 31,
2022
|
Assets
|
|
|
(Unaudited)
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash
|
|
$
|
267
|
|
|
$
|
723
|
Trade receivables,
net
|
|
|
860
|
|
|
|
876
|
Inventories
|
|
|
3,989
|
|
|
|
4,442
|
Prepaid expenses and
current assets
|
|
|
941
|
|
|
|
579
|
Total current
assets
|
|
|
6,057
|
|
|
|
6,620
|
Property and equipment,
net
|
|
|
5,489
|
|
|
|
5,741
|
Right-of-use
assets
|
|
|
2,698
|
|
|
|
2,988
|
Intangible assets,
net
|
|
|
5,655
|
|
|
|
5,758
|
Other assets,
net
|
|
|
354
|
|
|
|
369
|
Total
Assets
|
|
$
|
20,253
|
|
|
$
|
21,476
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
2,077
|
|
|
$
|
1,728
|
Accrued
liabilities
|
|
|
1,429
|
|
|
|
1,509
|
Deferred
revenue
|
|
|
115
|
|
|
|
18
|
Current portion of
secured credit facilities, net of debt issuance costs
|
|
|
3,377
|
|
|
|
3,442
|
Current portion of note
payable, related party
|
|
|
4,651
|
|
|
|
4,598
|
Current portion of
notes payable
|
|
|
7,749
|
|
|
|
-
|
Current portion of
lease liabilities
|
|
|
870
|
|
|
|
991
|
Other current
liability, related party
|
|
|
1,024
|
|
|
|
725
|
Total current
liabilities
|
|
|
21,292
|
|
|
|
13,011
|
Lease liabilities, net
of current portion
|
|
|
1,970
|
|
|
|
2,140
|
Note payable, related
party
|
|
|
-
|
|
|
|
92
|
Notes payable, net of
current portion
|
|
|
-
|
|
|
|
7,749
|
Total
liabilities
|
|
|
23,262
|
|
|
|
22,992
|
|
|
|
|
|
|
|
|
Stockholders' equity
(deficit):
|
|
|
|
|
|
|
|
Common stock, $0.0001
par value; 35,000,000 shares authorized; 16,660,171 and
16,199,269 shares issued and outstanding as of
March 31, 2023 and December 31, 2022, respectively
|
|
|
2
|
|
|
|
2
|
Preferred stock,
$0.0001 par value; 100,000,000 shares authorized;
2,500,000 shares issued and outstanding as of both March 31,
2023
and December 31, 2022
|
|
|
-
|
|
|
|
-
|
Additional paid-in
capital
|
|
|
73,646
|
|
|
|
73,503
|
Accumulated
deficit
|
|
|
(76,657)
|
|
|
|
(75,021)
|
Total stockholders'
equity (deficit)
|
|
|
(3,009)
|
|
|
|
(1,516)
|
Total Liabilities
and Stockholders' Equity
|
|
$
|
20,253
|
|
|
$
|
21,476
|
Eastside Distilling,
Inc. and Subsidiaries
|
For the Three Months
Ended March 31, 2023 and 2022
|
(Dollars and shares
in thousands, except per share amounts)
|
(Unaudited)
|
|
Consolidated
Statements of Operations:
|
|
|
2023
|
2022
|
Sales
|
$2,879
|
$3,780
|
Less customer programs
and excise taxes
|
26
|
40
|
Net sales
|
2,853
|
3,740
|
Cost of
sales
|
2,212
|
2,793
|
Gross
profit
|
641
|
947
|
Operating
expenses:
|
|
|
Sales and marketing
expenses
|
511
|
647
|
General and
administrative expenses
|
1,364
|
1,930
|
Loss on disposal of
property and equipment
|
6
|
-
|
Total operating
expenses
|
1,881
|
2,577
|
Loss from
operations
|
(1,240)
|
(1,630)
|
Other income (expense),
net
|
|
|
Interest
expense
|
(329)
|
(406)
|
Other
expense
|
(29)
|
-
|
Total
other income (expense), net
|
(358)
|
(406)
|
Loss before income
taxes
|
(1,598)
|
(2,036)
|
Provision for income
taxes
|
-
|
-
|
Net loss
|
(1,598)
|
(2,036)
|
Preferred stock
dividends
|
(38)
|
(38)
|
Net loss attributable
to common shareholders
|
$(1,636)
|
$(2,074)
|
|
EPS:
|
|
|
2023
|
2022
|
Basic and diluted net
loss per common share
|
$(0.10)
|
$(0.14)
|
Basic and diluted
weighted average common shares outstanding
|
16,475
|
14,901
|
Eastside Distilling,
Inc. and Subsidiaries
|
For the Three Months
Ended March 31, 2023 and 2022
|
(Dollars in
thousands)
|
Segments:
|
|
|
2023
|
2022
|
Craft
C+P
|
|
|
Sales
|
$ 1,456
|
$ 1,076
|
Net sales
|
1,477
|
1,076
|
Cost of
sales
|
1,578
|
1,111
|
Gross profit
|
(101)
|
(35)
|
Total operating
expenses
|
749
|
1,047
|
Net loss
|
(884)
|
(1,093)
|
Gross margin
|
-7 %
|
-3 %
|
|
|
|
Interest
expense
|
$4
|
$11
|
Depreciation and
amortization
|
368
|
221
|
Significant noncash
items:
|
|
|
Stock
compensation
|
-
|
205
|
|
|
|
Spirits
|
|
|
Sales
|
$ 1,423
|
$ 2,704
|
Net sales
|
1,376
|
2,664
|
Cost of
sales
|
634
|
1,682
|
Gross profit
|
742
|
982
|
Total operating
expenses
|
522
|
625
|
Net income
|
221
|
357
|
Gross margin
|
54 %
|
37 %
|
|
|
|
Depreciation and
amortization
|
$39
|
$ 42
|
|
|
|
Corporate
|
|
|
Total operating
expenses
|
$ 610
|
$ 905
|
Net loss
|
(935)
|
(1,300)
|
|
|
|
Interest
expense
|
$325
|
$395
|
Significant noncash
items:
|
|
|
Stock
compensation
|
111
|
170
|
|
Adjusted EBITDA
Reconciliation:
|
|
|
2023
|
2022
|
Net loss
|
$(1,598)
|
$(2,036)
|
Add:
|
|
|
Interest
expense
|
329
|
406
|
Depreciation and
amortization
|
407
|
263
|
EBITDA
|
(862)
|
(1,367)
|
Loss on disposal of
property and equipment
|
6
|
-
|
Stock
compensation
|
111
|
375
|
Adjusted
EBITDA
|
$ (745)
|
$ (992)
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/eastside-distilling-reports-first-quarter-2023-financial-results-301824447.html
SOURCE Eastside Distilling, Inc.