Company: IPST
Filing Date: 2025-06-04
Form Type: POS AM
Source: 0001641172-25-013501
Chunk: 104

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-06-04
Form: POS AM
Chunk 104
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 retailers moved through their inventory and the movement of reorders into second    
 quarter 2025 that occurred in first quarter 2024 for DtC items. A portion of the reduction      
 in retail revenue in three months ended March 31, 2025 versus 2024 was also from 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 $171,000 decrease in third-party products sales was primarily a result of winding 
 down our contracts on producing bulk whiskey for third parties in 2024 as we continue to        
 shift our focus and resources into higher margin activities.                                    |

Online DtC Product Sales from our online distributor’s inventory sold retailers for resale to retail customers for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 reflected the Company’s increased focus on high-margin direct to consumer (“DtC”) and online sales period over period. The tables below report the substantial increase in the retail value of DtC products sold to consumers during the three months ended March 31, 2025 versus 2024 (sales from our online distributor’s inventory) as follows (in dollars and units sold):

| 62 |

|                                        | Products Sales - DtC and online | Three               
 Months Ended  March 
 31,  (rounded       
 to $000’s)          |    2025 |     |   |    2024 |     |   |  Change |     |     | % Increase |   |
|:---------------------------------------|:--------------------------------|:--------------------|--------:|:----|:--|--------:|:----|:--|--------:|:----|:----|-----------:|:--|
| Salute Series and Military DtC Spirits |                                 | $                   | 426,000 |     | $ | 241,000 |     | $ | 185,000 |     |     |       76.8 | % |
| Other HDC DtC Spirits                  |                                 |                     |  13,000 |     |   |   7,