Company: IPST
Filing Date: 2025-08-26
Form Type: S-1
Source: 0001213900-25-080839
Chunk: 149

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-08-26
Form: S-1
Chunk 149
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.6% (57.4% excluding unabsorbed overhead) for the six months ended June30, 2024 are inclusive of low margin production contracts we ended in 2024, the significant

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amount of unabsorbed overhead we booked (which drags down gross margin based on the amount of unused capacity in our system), and approximately $27,000 in product inventory write downs in the six months ended June30, 2025 compared to approximately $102,000 in product inventory write downs and adjustments in the six months ended June30, 2024. As we work to shed some of our excess capacity and overhead, and as we increase our sales of higher margin items, we expect this Products gross margin to increase significantly ( See also below our comments related to this in more detail in Non -GAAP Financial Measures). Sales and Marketing Expenses Sales and marketing expenses were approximately $3,287,000 for the six months ended June 30, 2025 compared to approximately $2,488,000 for the six months ended June 30, 2024. This approximately $799,000 increase included:

| Sales and Marketing Expense                
 2025                                       |     | Six Months Ended June 30, 
 (rounded to $000’s)       |      2024 |     |   |    Change |     |   |          |   |
|:-------------------------------------------|:----|:--------------------------|----------:|:----|:--|----------:|:----|:--|---------:|:--|
| Personnel – Cash Wages and Related Expense |     | $                         | 1,555,000 |     | $ | 1,309,000 |     | $ |  246,000 |   |
| Personnel – Share-Based Compensation       |     |                           |   647,000 |     |   |         — |     |   |  647,000 |   |
| Tasting Room                               |     |                           |    44,000 |     |   |    70,000 |     |   |  (26,000 | ) |
| Leases and Rentals                         |     |                           |   378,000 |     |   |   353,000 |     |   |   25,000 |   |
| Sales and Marketing Expenses               |     |                           |   288,000 |     |   |   277,000 |     |   |   11,