Company: IPST
Filing Date: 2025-12-23
Form Type: 424B3
Source: 0001213900-25-125341
Chunk: 145

Company: Heritage Distilling Holding Company, Inc.
Filing Date: 2025-12-23
Form: 424B3
Chunk 145
---
 reducing overhead expenses and focusing on high margin items are starting to bear fruit. Gross Profit Analysis — Spirits Business Gross Margin numbers above are based on the total sales for the nine months ended September 30, 2025 and 2024 as follows:

| Total Sales – Spirits Business 
 2025                           |     | Nine Months Ended   
 September 30,       
 (rounded to $000’s) |      2024 |     |   |           |     | Change |            |   |
|:-------------------------------|:----|:--------------------|----------:|:----|:--|----------:|:----|:-------|:-----------|:--|
| Products                       |     | $                   | 2,714,000 |     | $ | 4,051,000 |     | $      | (1,337,000 | ) |
| Services                       |     |                     |   780,000 |     |   | 1,259,000 |     |        | (479,000   | ) |
|                                |     | $                   | 3,494,000 |     | $ | 5,310,000 |     | $      | (1,816,000 | ) |

•Gross margin was approximately 13.6% and 33.6% (65.0% and 64.8%, excluding unabsorbed overhead) for the nine months ended September30, 2025 and 2024, respectively, based upon total net sales of approximately $3,494,000 and $5,310,000, respectively. As we add more Special Operations Salutesales via online channels, and look to restart digital advertising we expect to see our overall gross margin increase. Likewise, as we add more states into our wholesale distribution channel focused solely on high -marginitems, rather than any low -marginwell vodka in those states, we expect to see additional margin increases. As we move to third party production in 2026 and we move into 2026 with a significantly reduced headcount, we expect unabsorbed overhead to be greatly reduced on a full year basis in 2026 and overall gross profit and gross margin to improve. •Gross margin for Products of (9.5)% (56.7% excluding unabsorbed overhead) for the nine months ended September30, 2025 compared to 15.4% (56.2% excluding unabsorbed overhead) for the nine months ended