Company to Host Conference Call at 5:00 pm ET Wednesday August 14, 2024 PORTLAND, Ore., Aug. 14, 2024 /PRNewswire/ -- Eastside Distilling, Inc. (NASDAQ:EAST) ("Eastside" or the "Company"), a consumer-focused beverage company that builds craft inspired experiential brands and high-quality artisanal products around premium spirits, digital can printing, co-packing and mobile filling, reported second quarter financial results for the period ended June 30, 2024. Second Quarter 2024 Highlights: Craft digitally printed a quarter-record 6.0 million cans representing a +43% increase over the prior year, increasing sales +22% for the quarter. Spirits gross profit improved +84% compared to the prior year quarter with substantial improvement in margins expected through the balance of the year. The Company's overall operating loss decreased $0.2 million in the quarter over the prior year. Financial Results Gross sales for the three months ending June 30, 2024 increased to $3.1 million from $2.8 million for the three months ending June 30, 2023. Higher digital printing sales were offset by lower mobile canning and spirits sales. Spirits sales fell primarily due to lower volumes of tequila driven by a realignment of the brand with new distribution partners. Gross profit for the three months ending June 30, 2024 increased to $0.2 million from $26,000 for the three months ending June 30, 2023. Consolidated gross margin was 5% and 1% for the three months ending June 30, 2024 and 2023, respectively. Craft C+P gross margin increased due to higher printed can volumes. Spirits gross margin increased due to Azuñia tequila and other cost savings on raw materials in 2024. Operating costs for the three months ending June 30, 2024 decreased to $1.3 million from $1.4 million for the three months ending June 30, 2023 primarily due to decreased headcount and lower professional fees and sponsorship costs. The Company continues its broad restructuring in spirits as it realigns investment focusing on the most profitable spirits brands and regions. Net loss for the three months ending June 30, 2024 decreased to $1.5 million from $1.6 million for the three months ending June 30, 2023. 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 final table below provides a reconciliation of this non-GAAP financial measure with the most directly comparable GAAP financial measure. Second Quarter 2024 Conference Call Details Date and Time: Wednesday, August 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 #7830926. 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 highest 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 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 June 30, 2024 and December 31, 2023 Dollars in thousands, except share and per share June 30, 2024 December 31, 2023 (unaudited) Assets Current assets: Cash $ 420 $ 403 Trade receivables, net 1,017 559 Inventories 3,043 3,212 Prepaid expenses and other current assets 467 363 Total current assets 4,947 4,537 Property and equipment, net 4,282 4,768 Right-of-use assets 2,140 2,602 Intangible assets, net 4,798 5,005 Other assets, net 422 568 Total Assets $ 16,589 $ 17,480 Liabilities and Stockholders' Equity (Deficit) Current liabilities: Accounts payable $ 2,916 $ 2,076 Accrued liabilities 742 575 Deferred revenue 51 88 Current portion of secured credit facilities, related party 3,323 - Current portion of secured credit facilities, net of debt issuance costs 935 - Current portion of notes payable 8,117 486 Current portion of notes payable, related party 92 92 Current portion of lease liabilities 909 888 Other current liability, related party 83 - Total current liabilities 17,168 4,205 Lease liabilities, net of current portion 1,355