Company to Host Conference Call at 5:00 pm ET Monday May 13, 2024

PORTLAND, Oregon, May 13, 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 first quarter financial results for the period ended March 31, 2024.

First Quarter 2024 Highlights:

Craft digitally printed a quarter-record 4.8 million cans representing a +320% increase over the prior year
Both operating segments made improvements in the quarter over the prior year excluding barrel sales at Spirits
Company decreased operating costs over $0.6 million

Financial Results

Gross sales for the three months ending March 31, 2024 decreased to $2.5 million from $2.9 million for the three months ending March 31, 2023. Higher digital printing sales were offset by lower mobile canning and spirits sales. Spirits sales fell due primarily to the Company's bulk sale of 250 barrels for gross proceeds of $0.6 million during the three months ended March 31, 2023.

Gross profit for the three months ending March 31, 2024 decreased to $0.2 million from $0.6 million for the three months ending March 31, 2023. Consolidated gross margin was 8% and 22% for the three months ending March 31, 2024 and 2023, respectively. Craft C+P gross margin increased due to higher printed can volumes. Spirits gross margin decreased due to gross profit of $0.5 million from bulk sales of barrels during the three months ended March 31, 2023.

Operating costs for the three months ending March 31, 2024 decreased to $0.2 million from $0.6 million for the three months ending March 31, 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 March 31, 2024 decreased to $1.3 million from $1.6 million for the three months ending March 31, 2023. The Company reported improved EBITDA of $(0.7) million and $(0.9) million for the three months ending March 31, 2024 and 2023, respectively. Craft's EBITDA loss improved to $(0.3) million. Spirits reported EBITDA of $(0.1) million in the quarter. (See description of EBITDA in "Use of Non-GAAP Measures" below.)

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.

First Quarter 2024 Conference Call Details

Date and Time: Monday, May 13, 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 #10189029. 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 March 31, 2024 and December 31, 2023 Dollars in thousands, except share and per share

	March 31, 2024		December 31, 2023
	(unaudited)
Assets
Current assets:
Cash	$	336	$	403
Trade receivables, net		673		559
Inventories		3,189		3,212
Prepaid expenses and other current assets		498		363
Total current assets		4,696		4,537
Property and equipment, net		4,571		4,768
Right-of-use assets		2,388		2,602
Intangible assets, net		4,902		5,005
Other assets, net		465		568
Total Assets	$	17,022	$	17,480

Liabilities and Stockholders' Equity (Deficit)
Current liabilities:
Accounts payable	$	2,392	$	2,076
Accrued liabilities		739		575
Deferred revenue		66		88
Current portion of secured credit facilities, related party		2,680		-
Current portion of secured credit facilities, net of debt issuance costs		364		-
Current portion of notes payable		8,079		486
Current portion of notes payable, related party		92		92
Current portion of lease liabilities		903		888
Other current liability, related party		587		-
Total current liabilities		15,902		4,205
Lease liabilities, net of current portion		1,596		1,824
Secured credit facilities, related party		-		2,700
Secured credit facilities, net of debt issuance costs		-		342
Notes payable, net of current portion		-		7,556
Total liabilities		17,498		16,627

Stockholders' equity (deficit):
Common stock, $0.0001 par value; 6,000,000 shares authorized as of March 31, 2024 and December 31, 2023; and 1,707,751 shares and 1,705,987 shares issued and outstanding as of March 31, 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 March 31, 2024 and December 31, 2023		-		-
Preferred stock, $0.0001 par value; 240,000 shares authorized; 200,000 Series C shares issued and outstanding as of both March 31, 2024 and December 31, 2023		-		-
Additional paid-in capital		83,561		83,559
Accumulated deficit		(84,037)		(82,706)
Total stockholders' equity (deficit)		(476)		853
Total Liabilities and Stockholders' Equity (Deficit)	$	17,022	$	17,480

Eastside Distilling, Inc. and Subsidiaries For the Three Months Ended March 31, 2024 and 2023 (Dollars and shares in thousands, except per share amounts) (Unaudited)
Consolidated Statements of Operations:

	2024		2023

Sales	$	2,487	$	2,879
Less customer programs and excise taxes		76		26
Net sales		2,411		2,853
Cost of sales		2,225		2,212
Gross profit		186		641
Operating expenses:
Sales and marketing expenses		251		511
General and administrative expenses		1,105		1,364
(Gain) loss on disposal of property and equipment		(120)		6
Total operating expenses		1,236		1,881
Loss from operations		(1,050)		(1,240)
Other income (expense), net
Interest expense		(248)		(329)
Other income (expense)		5		(29)
Total other expense, net		(243)		(358)
Loss before income taxes		(1,293)		(1,598)
Provision for income taxes		-		-
Net loss		(1,293)		(1,598)
Preferred stock dividends		(38)		(38)
Net loss attributable to common shareholders	$	(1,331)	$	(1,636)

Basic and diluted net loss per common share	$	(0.78)	$	(2.00)
Basic and diluted weighted average common shares outstanding		1,706		824

Eastside Distilling, Inc. and Subsidiaries For the Three Months Ended March 31, 2024 and 2023 (Dollars in thousands) (Unaudited)
Segments:

(Dollars in thousands)	2024			2023
Craft C+P
Sales	$	1,849		$	1,456
Net sales		1,814			1,477
Cost of sales		1,765			1,578
Gross profit		49			(101)
Total operating expenses		638			749
Net loss		(590)			(884)
Gross margin		3	%		-7	%

Interest expense	$	-		$	4
Depreciation and amortization		270			368
Significant noncash items:
(Gain) loss on disposal of property and equipment		(120)			6

Spirits
Sales	$	638		$	1,423
Net sales		597			1,376
Cost of sales		460			634
Gross profit		137			742
Total operating expenses		234			522
Net income (loss)		(92)			221
Gross margin		23	%		54	%

Depreciation and amortization	$	36		$	39

Corporate
Total operating expenses	$	364		$	610
Net loss		(611)			(935)

Interest expense	$	248		$	325

Significant noncash items:
Stock compensation		67			111

Adjusted EBITDA Reconciliation:

	Three Months Ended March 31,
	2024		2023
Net loss	$	(1,293)	$	(1,598)
Add:
Interest expense		248		329
Depreciation and amortization		306		407
EBITDA		(739)		(862)
(Gain) loss on disposal of property and equipment		(120)		6
Stock compensation		67		111
Adjusted EBITDA	$	(792)	$	(745)

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SOURCE Eastside Distilling, Inc.

Eastside Distilling Reports First Quarter 2024 Financial Results