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Splash Beverage Group Reports Second Quarter 2023 Financial Results

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Quarterly Revenues Rise 15%, Six Month Revenues Rise 31%

Quarterly Gross Profit Increase 32%

Six Month Gross Profit Increases 34%

FORT LAUDERDALE, FL – (NewMediaWire) – August 14, 2023 – Splash Beverage Group, Inc. (NYSE American: SBEV) (“Splash” or the “Company”), a portfolio company of leading beverage brands, today reported financial results for the second  quarter period ended June 30, 2023.  Investors are encouraged to read the Company’s quarterly report on Form 10-Q which was filed with the Securities and Exchange Commissions (the “SEC”), contains additional information, and is posted at https://splashbeveragegroup.com/.

 

Second Quarter Financial Performance

·       Net revenues for the second quarter period ending June 30, 2023, were $5.2 million compared to $4.5 million in the prior year period, an increase of 15% over the prior year period.  For the six-month period, revenues reached $11.0 million compared to $8.4 million in the prior year period and an increase of 31%. The increase in revenue was primarily due to increased sales from our B2B and B2C e-commerce platform, Qplash, which reflected an increase in territory coverage, new products and larger purchases per customer.  In the six-month period, overall e-commerce sales increased 43% over the prior year period and the beverage business increased 7%.

·       Gross profit for the second quarter period ending June 30, 2023, was $1.7 million compared to $1.3 million in the prior year period.  Gross margin in the second quarter of 32% was a 90-basis point improvement over the prior year period, with cost efficiencies and product mix driving the improvements.   Six-month gross profit was $3.5 million compared to $2.6 million in the prior year period, a 34.6% increase.

·       TapouT Energy Drink launched towards the end of the second quarter as the Company eyes second half impact.

·       The second quarter net loss was $5.6 million compared to $5.7 million in the prior year period. Increases in freight cost, amazon fees, marketing expenses and salary and wages in 2023 to support the revenue growth impact loses in the quarter. 

·       As of June 30, 2023, the company had total cash and cash equivalents of $903,235, compared with $4.4 million at December 31, 2022

·       Subsequently the Company has raised additional $2.7 Million from legacy investors and entered into a favorable credit facility agreement for $10 million.

Robert Nistico, Splash Beverage Group’s Chairman and CEO, commented, “Our 2023 second quarter results reflect the strengths that we are developing as we grow the business as well as some of the challenges that inevitably emerge in growth businesses.  Our Qplash platform, which has increased 43% in the first half of the year compared to last year, is developing very nicely on both a B2B and B2C basis and is now expanding to select international markets.  We look for continued contributions from that business.  Our quarterly beverage revenues were down slightly in the second quarter, but we attribute that to buying patterns of distributors which can have an impact of timing of sales.  The first half beverage sales increased modestly at 7% overall, so we expect a greater upward trend the second half of the year. The beverage business generally “stair steps” it’s way to growth … you focus on distribution, support those new placements with marketing and the cycle starts over again. In total, we are where we believe we are supposed to be.”

 

“Subsequent to the second quarter reporting period,” Nistico continued, “We disclosed an additional $2.7 million raise from existing investors and a $10 million credit facility which will not only provide us with needed growth capital, but also allows us to withdraw the much larger $200 million shelf offering which has been the source of some investor concern.  We remain committed to executing a business plan that relies on 4 key pillars for success.  We have a strong management team, we have a diverse portfolio of brands that match consumer trends, our marketing strategy continues to yield new distribution agreements and retail authorizations, and we have the financial flexibility we need.  We look forward to the second half of 2023.”

 

About Splash Beverage Group, Inc.

Splash Beverage Group, an innovator in the beverage industry, owns a growing portfolio of alcoholic and non-alcoholic beverage brands including Copa di Vino wine by the glass, SALT flavored tequilas, Pulpoloco sangria, and TapouT performance hydration and recovery drink. Splash’s strategy is to rapidly develop early-stage brands already in its portfolio as well as acquire and then accelerate brands that have high visibility or are innovators in their categories. Led by a management team that has built and managed some of the top brands in the beverage industry and led sales from product launch into the billions, Splash is rapidly expanding its brand portfolio and global distribution. 

 

For more information visit:

www.SplashBeverageGroup.com

www.copadivino.com

www.drinksalttequila.com

www.pulpo-loco.com

www.tapoutdrinks.com

 

Forward-Looking Statement

This press release includes “forward-looking statements” within the meaning of U.S. federal securities laws. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results and, consequently, you should not rely on these forward-looking statements as predictions of future events. These forward-looking statements and factors that may cause such differences include, without limitation, the risks disclosed in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2022, and in the Company’s other filings with the SEC. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Except as required by law, the Company disclaims any obligation to update or publicly announce any revisions to any of the forward-looking statements contained in this press release.

 

Contact Information:

Splash Beverage Group

Info@SplashBeverageGroup.com

954-745-5815

Splash Beverage Group, Inc.

Condensed Consolidated Balance Sheets

June 30, 2023 and December 31, 2022

 

 

 

 

 

 

 

 

 

 

 

June 30,
2023

 

December 31, 2022

Assets

 

 

(unaudited)

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

903,235

 

 

$

4,431,745

 

Accounts receivable, net

 

 

1,954,508

 

 

 

1,812,110

 

Prepaid expenses

 

 

397,025

 

 

 

348,036

 

Inventory

 

 

3,447,292

 

 

 

3,721,307

 

Other receivables

 

 

192,942

 

 

 

344,376

 

Total current assets

 

 

6,895,002

 

 

 

10,657,574

 

 

 

 

 

 

 

 

 

 

Non-current assets:

 

 

 

 

 

 

 

 

Deposit

 

$

49,431

 

 

$

49,290

 

Goodwill

 

 

256,823

 

 

 

256,823

 

Intangible assets, net

 

 

4,662,054

 

 

 

4,851,377

 

Investment in Salt Tequila USA, LLC

 

 

250,000

 

 

 

250,000

 

Operating lease right of use asset

 

 

595,913

 

 

 

750,042

 

Property and equipment, net

 

 

423,844

 

 

 

489,597

 

Total non-current assets

 

 

6,238,065

 

 

 

6,647,129

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

13,133,067

 

 

$

17,304,703

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$

3,307,836

 

 

$

3,383,187

 

Liability to issue shares

 

 

 

 

 

91,800

 

Operating lease liabilities – current

 

 

230,945

 

 

 

268,749

 

Notes payable, current portion

 

 

4,272,014

 

 

 

1,080,257

 

Shareholder advances

 

 

200,000

 

 

 

 

Due to related party

 

 

250,000

 

 

 

 

Accrued interest payable

 

 

300,658

 

 

 

141,591

 

Total current liabilities

 

 

8,561,453

 

 

 

4,965,584

 

 

 

 

 

 

 

 

 

 

Long-term liabilities:

 

 

 

 

 

 

 

 

Notes payable

 

 

236,657

 

 

 

2,536,319

 

Operating lease liabilities – noncurrent

 

 

364,959

 

 

 

480,666

 

Total long-term liabilities

 

 

601,616

 

 

 

3,016,985

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

9,163,069

 

 

 

7,982,569

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued

 

 

 

 

 

 

Common Stock, $0.001 par, 300,000,000 shares authorized, 42,802,186 shares issued, 42,802,186 shares outstanding at June 30, 2023 and 41,085,520 shares issued, 41,085,520 shares outstanding at December 31, 2022

 

 

42,802

 

 

 

41,086

 

Additional paid in capital

 

 

125,635,624

 

 

 

121,632,547

 

Accumulated other comprehensive loss

 

 

(37,854

)

 

 

(20,472

)

Accumulated deficit

 

 

(121,670,574

)

 

 

(112,331,027

)

Total stockholders’ equity

 

 

3,969,998

 

 

 

9,322,134

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

13,133,067

 

 

$

17,304,703

 

Splash Beverage Group, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

For the Three and Six Months Ended June 30, 2023 and 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended June 30

 

Six months ended June 30,

 

 

2023

 

2022

 

2023

 

2022

Net revenues

 

 

5,194,951

 

 

 

 

4,498,940

 

 

 

 

11,017,678

 

 

 

8,425,514

 

Cost of goods sold

 

 

(3,417,868

)

 

 

 

(3,149,275

 

)

 

 

(7,479,096

)

 

 

(5,784,701

)

Gross profit

 

 

1,777,083

 

 

 

 

1,349,665

 

 

 

 

3,538,582

 

 

 

2,640,813

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracted services

 

 

331,297

 

 

 

 

327,302

 

 

 

 

712,302

 

 

 

758,848

 

Salary and wages

 

 

1,364,136

 

 

 

 

1,131,612

 

 

 

 

2,598,263

 

 

 

1,917,263

 

Non-cash share-based compensation

 

 

641,097

 

 

 

 

2,772,369

 

 

 

 

856,857

 

 

 

5,342,494

 

Other general and administrative

 

 

2,919,533

 

 

 

 

2,282,471

 

 

 

 

5,568,234

 

 

 

4,963,853

 

Sales and marketing

 

 

742,369

 

 

 

 

665,059

 

 

 

 

1,479,196

 

 

 

1,171,455

 

Total operating expenses

 

 

5,998,432

 

 

 

 

7,178,813

 

 

 

 

11,214,852

 

 

 

14,153,913

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from continuing operations

 

 

(4,221,349

)

 

 

 

(5,829,148

 

)

 

 

(7,676,270

)

 

 

(11,513,100

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income/(expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

1,320

 

 

 

 

2,709

 

 

 

 

1,320

 

 

 

2,709

 

Interest expense

 

 

(172,641

)

 

 

 

(73,471

 

)

 

 

(339,762

)

 

 

(159,350

)

Other Income/Expense

 

 

(90,585

)

 

 

 

 

 

 

 

49,819

 

 

 

(1

)

Amortization of debt discount

 

 

(1,126,994

)

 

 

 

 

 

 

 

(1,374,655

)

 

 

 

Total other income/(expense)

 

 

(1,388,900

)

 

 

 

(70,762

 

)

 

 

(1,663,278

)

 

 

(156,642

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss from continuing operations, net of tax

 

 

(5,610,249

)

 

 

 

(5,899,910

 

)

 

 

(9,339,548

)

 

 

(11,669,742

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) from discontinued operations, net of tax

 

 

 

 

 

 

25,421

 

 

 

 

 

 

 

(199,154

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of discontinued operations

 

 

 

 

 

 

115,632

 

 

 

 

 

 

 

115,632

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income of discontinued operations

 

 

 

 

 

 

141,053

 

 

 

 

 

 

 

(83,522

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(5,610,249

)

 

$

 

(5,758,857

 

)

 

$

(9,339,548

)

 

$

(11,753,264

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Comprehensive Income (Loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation loss

 

 

(15,774

)

 

 

 

 

 

 

 

(17,382

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Comprehensive Income (Loss)

 

$

(5,626,023

)

 

$

 

(5,758,857

 

)

 

$

(9,356,930

)

 

$

(11,753,264

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) per share – continuing operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.13

)

 

 

$

(0.16

)

 

 

$

(0.22

)

 

$

(0.32

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding – continuing operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

 

42,058,047

 

 

 

 

36,675,323

 

 

 

 

41,575,470

 

 

 

35,935,972

 

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