Company to Host Conference Call at 5:00 pm
ET Thursday November 14,
2024
PORTLAND, Ore. and PROVIDENCE,
R.I., Nov. 14, 2024 /PRNewswire/
-- Eastside Distilling, Inc. (NASDAQ: EAST) ("Eastside" or the "Company"), a holding
company for Bridgetown Spirits Corp., a consumer-focused
beverage company that builds craft inspired experiential brands and
for Beeline Financial Holdings, Inc. ("Beeline"), a recently
acquired pioneering mortgage technology company that operates an
end-to-end, all-digital, AI-enhanced platform for homeowners and
property investors, reported third quarter financial results for
the period ended September 30,
2024.
In the Company's financial results and the discussion below,
Craft Canning + Printing ("Craft C+P"), a subsidiary of the Company
until October 7, 2024, which provides
printing services to the craft canning industry in the Pacific
Northwest, is classified as "assets held for sale," as the Company
transferred its interest in Craft C+P on October 7, 2024. In addition, the financial
results and discussion below do not include Beeline Financial
Holdings, Inc., as it did not become a subsidiary of the Company
until October 7, 2024.
Third Quarter 2024 Highlights:
- Spirits segment (excluding corporate expenses) achieved
positive EBITDA and net income for the third quarter 2024.
- Spirits sales increased 14% from the second quarter of
2024.
- Subsequent to the close of the quarter, the Company entered
into an asset sale and debt exchange in which it disposed of Craft
C+P in settlement of debt.
- Immediately subsequent to the closing of the asset sale and
debt exchange, Beeline merged into a subsidiary of
Eastside. (See press release dated October 7, 2024.)
On September 4, 2024, the Company
and Craft C+P, entered into a Debt Exchange Agreement (the "Debt
Agreement"), which closed on October 7,
2024, resulting in the assignment by the Company of 720
barrels of spirits to Craft C+P, followed by the merger of Craft
C+P into a limited liability company owned by certain creditors of
the Company who, in exchange for Craft C+P, released the Company
from $6.6 million of debt and
surrendered Eastside preferred
stock with a book value of $1.2
million. Given that the effect of the Debt Agreement
meets all the initial criteria of ASC Topic 205-20, Presentation
of Financial Statements – Discontinued Operations for the
classification of held for sale, the assets, liabilities, and
operating results of Craft C+P have been classified as held for
sale as of September 30, 2024 and
December 31, 2023 and for the three
and nine months ended September 30,
2024 and 2023. The consolidated financial statements for the
prior periods have been adjusted to reflect comparable
information.
Subsequent to the execution of the Debt Agreement, the Company
organized a subsidiary named "Bridgetown Spirits Corp."
("Bridgetown") and assigned to
Bridgetown the Company's business
of manufacturing and marketing spirits. The following discussion
included in the Financial Results reflects the Bridgetown and Corporate segments.
Financial Results
The following information includes Bridgetown and Corporate segments and excludes
Craft C+P.
Gross sales for both the three months ending September 30, 2024 and 2023 was $0.8 million. During the three months
ending September 30, 2024,
Bridgetown sold 5,868 cases
compared to 6,849 cases in the prior year and sold 65 barrels for
gross proceeds of $0.1 million.
Gross profit for both the three months ending September 30, 2024 and 2023 was $0.2 million. Gross margin was 26% and 21% for
the three months ending September 30,
2024 and 2023, respectively, increasing due to bulk spirits
sales and continued cost savings initiatives that began in 2023 and
continued into 2024.
Operating costs for the three months ending September 30, 2024 increased to $0.7 million from $0.5
million for the three months ending September 30, 2023 primarily due to higher
professional fees incurred in connection with the Debt Agreement
and the Beeline merger.
Net loss for the three months ending September 30, 2024 decreased to $1.4 million from $2.2
million for the three months ending September 30, 2023. The Company's results for the
2023 period were burdened by a $1.3
million expense resulting from the conversion of debt to
equity during the three months ending September 30, 2023.
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 final table below provides a
reconciliation of this non-GAAP financial measure with the most
directly comparable GAAP financial measure.
Third Quarter 2024 Conference Call Details
Date and Time: Thursday, November
14, 2024 at 5:00 pm 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.
Replay: A teleconference replay of the call will be
available for three days at (877) 344-7529 or (412) 317-0088,
replay access code #8629688. 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) is a producer of
award-winning craft spirits, including whiskey, vodka, and rum.
Founded in Portland, Oregon,
Eastside is committed to quality,
innovation, and sustainability, delivering exceptional products
that reflect the spirit of the Pacific Northwest.
About Beeline Financial Holdings, Inc.
The Company recently closed on a merger with Beeline Financial
Holdings, Inc. Beeline is a technology-driven mortgage lender
offering a fully digital, AI-enhanced, platform that simplifies and
accelerates the home financing process for homeowners and property
investors. Based in Providence,
RI, Beeline is dedicated to transforming the mortgage
industry through innovative technology and customer-centric
solutions.
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 audited financial statements and accompanying
notes filed by the Company with the Securities and Exchange
Commission on Form 10-K for the period ended December 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
September 30, 2024 and December 31,
2023
(Dollars in thousands, except share and per
share)
|
|
|
|
September 30,
2024
|
|
|
December 31,
2023
|
|
|
|
(unaudited)
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
Cash
|
|
|
$310
|
|
|
|
$306
|
|
|
Trade receivables,
net
|
|
|
105
|
|
|
|
163
|
|
|
Inventories
|
|
|
1,793
|
|
|
|
2,686
|
|
|
Prepaid expenses and
other current assets
|
|
|
176
|
|
|
|
113
|
|
|
Current assets held for
sale
|
|
|
2,640
|
|
|
|
1,269
|
|
|
Total current
assets
|
|
|
5,024
|
|
|
|
4,537
|
|
|
Property and equipment,
net
|
|
|
112
|
|
|
|
169
|
|
|
Right-of-use
assets
|
|
|
430
|
|
|
|
680
|
|
|
Intangible assets,
net
|
|
|
4,178
|
|
|
|
4,178
|
|
|
Other assets,
net
|
|
|
182
|
|
|
|
247
|
|
|
Non-current assets held
for sale
|
|
|
6,298
|
|
|
|
7,669
|
|
|
Total
Assets
|
|
|
$ 16,224
|
|
|
|
$ 17,480
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity (Deficit)
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
$ 1,388
|
|
|
|
$ 1,062
|
|
|
Accrued
liabilities
|
|
|
418
|
|
|
|
465
|
|
|
Current portion of
secured credit facilities, related party
|
|
|
3,447
|
|
|
|
-
|
|
|
Current portion of
secured credit facilities, net of debt issuance
costs
|
|
|
728
|
|
|
|
-
|
|
|
Current portion of
notes payable
|
|
|
8,155
|
|
|
|
486
|
|
|
Current portion of
notes payable, related party
|
|
|
92
|
|
|
|
92
|
|
|
Current portion of
lease liabilities
|
|
|
191
|
|
|
|
223
|
|
|
Other current
liability, related party
|
|
|
85
|
|
|
|
-
|
|
|
Current liabilities
held for sale
|
|
|
3,124
|
|
|
|
1,877
|
|
|
Total current
liabilities
|
|
|
17,628
|
|
|
|
4,205
|
|
|
Lease liabilities, net
of current portion
|
|
|
213
|
|
|
|
458
|
|
|
Secured credit
facilities, related party
|
|
|
-
|
|
|
|
2,700
|
|
|
Secured credit
facilities, net of debt issuance costs
|
|
|
-
|
|
|
|
342
|
|
|
Notes payable, net of
current portion
|
|
|
-
|
|
|
|
7,556
|
|
|
Non-current liabilities
held for sale
|
|
|
843
|
|
|
|
1,366
|
|
|
Total
liabilities
|
|
|
18,684
|
|
|
|
16,627
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
(deficit):
|
|
|
|
|
|
|
|
|
|
Common stock, $0.0001
par value; 6,000,000 shares authorized as
of September 30, 2024 and December 31, 2023; and 3,140,625
shares and 1,705,987 shares issued and outstanding as of
September
30, 2024 and December 31, 2023, respectively
|
|
|
-
|
|
|
|
-
|
|
|
Preferred stock,
$0.0001 par value; 100,000,000 shares authorized;
2,500,000 Series B shares issued and outstanding as of both
September 30, 2024 and December 31, 2023
|
|
|
-
|
|
|
|
-
|
|
|
Preferred stock,
$0.0001 par value; 240,000 shares authorized;
117,586 Series C shares and 200,000 Series C shares issued and
outstanding as of September 30, 2024 and December 31, 2023,
respectively
|
|
|
-
|
|
|
|
-
|
|
|
Additional paid-in
capital
|
|
|
84,499
|
|
|
|
83,559
|
|
|
Accumulated
deficit
|
|
|
(86,959)
|
|
|
|
(82,706)
|
|
|
Total stockholders'
equity (deficit)
|
|
|
(2,460)
|
|
|
|
853
|
|
|
Total Liabilities
and Stockholders' Equity (Deficit)
|
|
|
$ 16,224
|
|
|
|
$ 17,480
|
|
|
Eastside Distilling,
Inc. and Subsidiaries
For the Three and Nine Months Ended
September 30, 2024 and 2023
(Dollars and shares in
thousands, except per share
amounts)
(Unaudited)
|
|
|
Consolidated
Statements of Operations:
|
|
|
|
Three Months
Ended
September 30,
|
|
|
Nine Months
EndedSeptember
30,
|
|
|
2024
|
|
|
2023
|
|
|
2024
|
|
|
2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
|
$ 783
|
|
|
|
$849
|
|
|
|
$2,106
|
|
|
|
$3,080
|
|
Less customer programs
and excise taxes
|
|
|
23
|
|
|
|
43
|
|
|
|
129
|
|
|
|
141
|
|
Net sales
|
|
|
760
|
|
|
|
806
|
|
|
|
1,977
|
|
|
|
2,939
|
|
Cost of
sales
|
|
|
560
|
|
|
|
638
|
|
|
|
1,476
|
|
|
|
1,940
|
|
Gross profit
|
|
|
200
|
|
|
|
168
|
|
|
|
501
|
|
|
|
999
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing
expenses
|
|
|
218
|
|
|
|
303
|
|
|
|
699
|
|
|
|
1,180
|
|
General and
administrative expenses
|
|
|
435
|
|
|
|
172
|
|
|
|
1,149
|
|
|
|
1,287
|
|
(Gain) loss on disposal
of property and
equipment
|
|
|
(1)
|
|
|
|
-
|
|
|
|
(1)
|
|
|
|
3
|
|
Total operating
expenses
|
|
|
652
|
|
|
|
475
|
|
|
|
1,847
|
|
|
|
2,470
|
|
Loss from
operations
|
|
|
(452)
|
|
|
|
(307)
|
|
|
|
(1,346)
|
|
|
|
(1,471)
|
|
Other income (expense),
net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(409)
|
|
|
|
(203)
|
|
|
|
(965)
|
|
|
|
(850)
|
|
Loss on debt to equity
conversion
|
|
|
-
|
|
|
|
(1,321)
|
|
|
|
-
|
|
|
|
(1,321)
|
|
Other income
|
|
|
33
|
|
|
|
25
|
|
|
|
37
|
|
|
|
57
|
|
Total other income
(expense), net
|
|
|
(376)
|
|
|
|
(1,499)
|
|
|
|
(928)
|
|
|
|
(2,114)
|
|
Loss before income
taxes
|
|
|
(828)
|
|
|
|
(1,806)
|
|
|
|
(2,274)
|
|
|
|
(3,585)
|
|
Provision for income
taxes
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Net loss from
continuing operations
|
|
|
(828)
|
|
|
|
(1,806)
|
|
|
|
(2,274)
|
|
|
|
(3,585)
|
|
Net loss from
discontinued operations
|
|
|
(531)
|
|
|
|
(350)
|
|
|
|
(1,866)
|
|
|
|
(1,812)
|
|
Net
loss
|
|
|
(1,359)
|
|
|
|
(2,156)
|
|
|
|
(4,140)
|
|
|
|
(5,397)
|
|
Preferred stock
dividends
|
|
|
(38)
|
|
|
|
(38)
|
|
|
|
(113)
|
|
|
|
(113)
|
|
Net loss attributable
to common
shareholders
|
|
|
$(1,397)
|
|
|
|
$ (2,194)
|
|
|
|
$(4,253)
|
|
|
|
$(5,510)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net loss per
common share
|
|
|
$(0.66)
|
|
|
|
$ (2.00)
|
|
|
|
$(2.28)
|
|
|
|
$(5.93)
|
|
Basic weighted average
common shares
outstanding
|
|
|
2,116
|
|
|
|
1,097
|
|
|
|
1,862
|
|
|
|
929
|
|
Eastside Distilling,
Inc. and Subsidiaries
For the Three and Nine Months Ended
September 30, 2024 and 2023
(Dollars in
thousands)
(Unaudited)
|
|
|
Segments:
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
(Dollars in
thousands)
|
2024
|
2023
|
Variance
|
|
2024
|
2023
|
Variance
|
|
Bridgetown
|
|
|
|
|
|
|
|
|
Sales
|
$ 783
|
$849
|
$(66)
|
|
$ 2,106
|
$ 3,080
|
$ (974)
|
|
Net sales
|
760
|
806
|
(46)
|
|
1,977
|
2,939
|
(962)
|
|
Cost of
sales
|
560
|
638
|
(78)
|
|
1,476
|
1,940
|
(464)
|
|
Gross profit
|
200
|
168
|
32
|
|
501
|
999
|
(498)
|
|
Total operating
expenses
|
217
|
303
|
(86)
|
|
698
|
1,183
|
(485)
|
|
Net income
(loss)
|
$ 18
|
$(110)
|
$128
|
|
$(162)
|
$(130)
|
$ (32)
|
|
Gross margin
|
26 %
|
21 %
|
5 %
|
|
25 %
|
34 %
|
-9 %
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
$435
|
$172
|
$ 263
|
|
$ 1,149
|
$ 1,287
|
$(138)
|
|
Net loss
|
$(846)
|
$ (1,696)
|
$850
|
|
$(2,112)
|
$(3,455)
|
$1,343
|
|
Adjusted EBITDA
Reconciliation:
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
Nine Months
Ended
September 30,
|
|
|
|
2024
|
|
|
2023
|
|
|
2024
|
|
|
2023
|
|
|
Net loss
|
|
|
$ (828)
|
|
|
|
$ (1,806)
|
|
|
|
$(2,274)
|
|
|
|
$(3,585)
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
409
|
|
|
|
203
|
|
|
|
965
|
|
|
|
850
|
|
|
Depreciation and
amortization
|
|
|
31
|
|
|
|
38
|
|
|
|
99
|
|
|
|
114
|
|
|
EBITDA
|
|
|
(388)
|
|
|
|
(1,565)
|
|
|
|
(1,210)
|
|
|
|
(2,621)
|
|
|
Gain on disposal of
property and equipment
|
|
|
(1)
|
|
|
|
-
|
|
|
|
(1)
|
|
|
|
3
|
|
|
Loss on debt to equity
conversion
|
|
|
-
|
|
|
|
1,321
|
|
|
|
-
|
|
|
|
1,321
|
|
|
Stock
compensation
|
|
|
-
|
|
|
|
(68)
|
|
|
|
-
|
|
|
|
98
|
|
|
Adjusted
EBITDA
|
|
|
$(389)
|
|
|
|
$(312)
|
|
|
|
$(1,211)
|
|
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$(1,199)
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multimedia:https://www.prnewswire.com/news-releases/eastside-distilling-reports-third-quarter-2024-financial-results-302306311.html
SOURCE Eastside Distilling, Inc.