Company: IPST
Filing Date: 2025-08-26
Form Type: S-1
Source: 0001213900-25-080839
Chunk: 143

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-08-26
Form: S-1
Chunk 143
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 January31, 2024. The bulk of our revenue in this category included production services revenue related to a contract we had to produce a gin for a large international spirit brand owner as we made the choice to focus our time, energy and resources on higher margin activities. Lesser amounts of revenue in this category in 2024 came from contract bottling services; and third -partybarrel sales and storage revenues. •The approximately $180,000 decrease in retail services was the result of the reduction of hours in some of our brick and mortar retail locations as we made the decision to close some locations on Mondays and Tuesday to reduce labor expenses on our slowest retail sales days during the quarter. During the same period in 2024 our retail locations were open seven days per week. We plan to reopen those locations on Mondays and Tuesdays as we get closer to the Memorial Day holiday to take advantage of higher summer foot traffic. •The approximately $75,000 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.

85

Cost of Sales Cost of sales were approximately $1,890,000 and $2,392,000 for the six months ended June 30, 2025 and 2024, respectively, a decrease of approximately $502,000, or 21.0%, period over period. Cost of Sales for the six months ended June 30, 2025 includes approximately $121,000 of non -cashshare -basedcompensation expenses related to RSU grant awards recognized in the six months ended June 30, 2025 for production employees compared to no such award recognition in 2024.

| Cost of Sales 
 2025          |     | Six Months Ended June 30, 
 (rounded to $000’s)       |      2024 |     |   |    Change |     |   |          |   |
|:--------------|:----|:--------------------------|----------:|:----|:--|----------:|:----|:--|:---------|:--|
| Products      |     | $                         | 1,872,000 |     | $ | 2,311,000 |     | $ | (439,000 | ) |
| Services      |     |                           |    18