Company: IPST
Filing Date: 2025-01-27
Form Type: S-1
Source: 0001213900-25-006695
Chunk: 128

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-01-27
Form: S-1
Chunk 128
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 financial measures, as described below, to understand and evaluate our core operating performance. These non-GAAP financial measures, which may be different than similarly titled measures used by other companies, are presented to enhance investors’ overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Adjusted Gross Profit and Adjusted Gross Margin:Adjusted gross profit represents GAAP gross profit adjusted for any nonrecurring gains and losses. Adjusted gross margin represents Adjusted gross profit as a percentage of total net sales. We use these measures (i) to compare operating performance on a consistent basis, (ii) for planning purposes, including the preparation of our internal annual operating budget, and (iii) to evaluate the performance and effectiveness of operational strategies. 86 EBITDA and Adjusted EBITDA:EBITDA represents GAAP net loss adjusted for (i) depreciation of property and equipment; (ii) interest expense; and (iii) provision for income taxes. Adjusted EBITDA represents EBITDA adjusted for nonrecurring gains and losses. We believe that EBITDA and adjusted EBITDA help identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we include in GAAP operating loss. These non-GAAP financial measures should not be considered in isolation from, or as substitutes for, financial information prepared in accordance with GAAP. There are several limitations related to the use of this non-GAAP financial measure compared to the closest comparable GAAP measure. Some of these limitations are that:

| ● | Adjusted gross profit, EBITDA                                                                                                         
 and adjusted EBITDA do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments; |

| ● | Adjusted gross profit, EBITDA                                                                       
 and adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs; |

| ● | Adjusted gross profit, EBITDA                                                                                                        
 and adjusted EBITDA exclude certain recurring, non-cash charges such as depreciation of property and equipment and, although this is 
 a non-cash charge, the assets being depreciated may have to be replaced in the future;                                               |

| ● | Adjusted gross profit, EBITDA                                 
 and adjusted EBITDA exclude income tax benefit (expense); and |

| ● | Other companies in our industry                                                                                          
 may calculate our non-GAAP financial measures differently than we do, limiting their usefulness