Company: IPST
Filing Date: 2025-05-12
Form Type: 424B3
Source: 0001641172-25-009684
Chunk: 104

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-05-12
Form: 424B3
Chunk 104
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 included Cask Club sales increasing $29,000      
 and Cocktail/Tasting orders in the tasting rooms increasing $30,000.                               |
| ● | The                                                                                                
 approximately $108,000 decrease in consulting fees is related to TBN projects as we saw the        
 successful completion and opening of the Stillaguamish project in October 2024 and we moved        
 the announced Coquille and Tonto Apache projects that were in planning phase into construction     
 phase in preparation for openings in late 2025.                                                    |

Cost of Sales

Cost of sales were approximately $6,276,000 and $5,820,000 for the years ended December 31, 2024 and 2023, respectively, an increase of approximately $456,000, or 7.8%, period over period.

|          | Total         
 Cost of Sales | Years              
 Ended December 31, 
 (rounded           
 to $000’s)         |      2024 |     |   |      2023 |     |   |    Change |   |
|:---------|:--------------|:-------------------|----------:|:----|:--|----------:|:----|:--|----------:|:--|
| Products |               | $                  | 6,173,000 |     | $ | 4,963,000 |     | $ | 1,210,000 |   |
| Services |               |                    |   103,000 |     |   |   857,000 |     |   |  (754,000 | ) |
|          |               | $                  | 6,276,000 |     | $ | 5,820,000 |     | $ |   456,000 |   |

The approximately $1,210,000 increase in net products cost of sales period over period included: an increase in product cost of approximately $875,000 to approximately $3,623,000 for the year ended December 31, 2024, from approximately $2,748,000 for the year ended December 31, 2023 which included an increase in unabsorbed overhead of approximately $335,000 to approximately $2,550,000 as of December 31, 2024 from approximately $2,215,000 as of December 31, 2023. We made the choice to move our sales focus onto higher margin products and away from low margin well-based products, resulting in fewer cases sold in 202