The Duckhorn Portfolio, Inc. (NYSE:NAPA) Q2 2022 Earnings Conference Call March 10, 2022 5:00 PM ET Company Participants Sean Sullivan - EVP, Chief Administrative Officer & General Counsel Alex Ryan - President, CEO and Chairman Lori Beaudoin - EVP and CFO Conference Call Participants Kaumil Gajrawala - Credit Suisse Lauren Lieberman - Barclays Kevin Grundy - Jefferies LLC Peter Galbo - BofA Securities Filippo Falorni - RBC Capital Markets Drew Levine - JPMorgan Operator Greetings, and welcome to the Duc ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended January 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-40240 The Duckhorn Portfolio, Inc. (Exact name of registrant as specified in its charter) Delaware 81-3866305 (I.R.S. Employer ...

The Duckhorn Portfolio, Inc. (NYSE:NAPA) Q1 2022 Results Conference Call December 8, 2021 5:00 PM ET Company Participants Sean Sullivan - EVP, Chief Administrative Officer and General Counsel Alex Ryan - Chairman, President and CEO Lori Beaudoin - CFO Conference Call Participants Rob Ottenstein - Evercore ISI Kevin Grundy - Jefferies Filippo Falorni - RBC Peter Galbo - Bank of America Lauren Lieberman - Barclays Operator Greetings and welcome to The Duckhorn Portfolio???s First Quarter 2022 Earnings Confere ...

PART I [Item 1. Financial Statements](index=8&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements and accompanying notes for the period [Condensed Consolidated Statements of Financial Position (unaudited)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Financial%20Position%20(unaudited)) Condensed Consolidated Statements of Financial Position (in thousands) | Metric | October 31, 2021 | July 31, 2021 | | :--- | :--- | :--- | | Total assets | $1,263,094 | $1,183,117 | | Total liabilities | $438,084 | $380,879 | | Total equity | $825,010 | $802,238 | | Cash | $5,247 | $4,244 | | Accounts receivable trade, net | $59,618 | $33,253 | | Inventories | $319,224 | $267,737 | | Accounts payable | $52,780 | $3,556 | | Accrued expenses | $50,690 | $21,557 | | Revolving line of credit, net | $108,679 | $121,348 | | Long-term debt, net | $111,887 | $114,625 | - Common stock outstanding remained at **115,046,793 shares** for both October 31, 2021, and July 31, 2021[20](index=20&type=chunk) [Condensed Consolidated Statements of Operations (unaudited)](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20(unaudited)) Condensed Consolidated Statements of Operations (in thousands, except per share amounts) | Metric | Three months ended Oct 31, 2021 | Three months ended Oct 31, 2020 | Change (YoY) | | :--- | :--- | :--- | :--- | | Net sales | $104,181 | $91,638 | +13.7% | | Cost of sales | $51,771 | $47,363 | +9.3% | | Gross profit | $52,410 | $44,275 | +18.4% | | Selling, general and administrative expenses | $23,158 | $16,805 | +37.8% | | Casualty loss, net | $49 | $1,555 | -96.8% | | Income from operations | $29,203 | $25,915 | +12.7% | | Interest expense | $1,606 | $3,580 | -55.1% | | Income before income taxes | $28,690 | $23,658 | +21.3% | | Net income attributable to The Duckhorn Portfolio, Inc | $21,273 | $17,523 | +21.4% | | Basic EPS | $0.18 | $0.17 | +5.9% | | Diluted EPS | $0.18 | $0.17 | +5.9% | [Condensed Consolidated Statements of Changes in Equity (unaudited)](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity%20(unaudited)) Changes in Equity (in thousands) for the three months ended October 31, 2021 | Metric | Amount | | :--- | :--- | | Net income | $21,273 | | Equity-based compensation | $1,459 | | Total equity (Oct 31, 2021) | $825,010 | | Total equity (Jul 31, 2021) | $802,238 | [Condensed Consolidated Statements of Cash Flows (unaudited)](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(unaudited)) Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Three months ended Oct 31, 2021 | Three months ended Oct 31, 2020 | Change (YoY) | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $22,747 | $2,487 | +$20,260 | | Net cash used in investing activities | $(5,896) | $(7,686) | +$1,790 | | Net cash (used in) provided by financing activities | $(15,848) | $252 | - $16,100 | | Net increase (decrease) in cash | $1,003 | $(4,947) | +$5,950 | | Cash - End of year | $5,247 | $1,305 | +$3,942 | [Notes to Condensed Consolidated Financial Statements (unaudited)](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) [Note 1 Description of Business](index=13&type=section&id=Note%201%20Description%20of%20Business) - The Duckhorn Portfolio, Inc produces luxury and ultra-luxury wines across brands including Duckhorn Vineyards, Paraduxx, Goldeneye, Migration, Decoy, Canvasback, Calera, Kosta Browne, Greenwing, and Postmark[28](index=28&type=chunk) - Revenue is generated through wholesale and DTC channels, with wholesale comprising sales to retailers and distributors[29](index=29&type=chunk) - In Q1 Fiscal 2022, a secondary offering involved existing shareholders selling **12,000,000 shares at $20.50 per share**, with the Company not receiving any proceeds[32](index=32&type=chunk) [Note 2 Significant Accounting Policies](index=13&type=section&id=Note%202%20Significant%20Accounting%20Policies) - The Condensed Consolidated Financial Statements are prepared in accordance with U.S GAAP and SEC Regulation S-X, and are unaudited[33](index=33&type=chunk)[34](index=34&type=chunk) - The Company consolidates a Variable Interest Entity (VIE) where it is the primary beneficiary, holding **76.2% ownership**[35](index=35&type=chunk)[39](index=39&type=chunk) - As an 'emerging growth company,' the Company has elected to delay the adoption of new or revised accounting pronouncements until they are applicable to private companies[40](index=40&type=chunk)[170](index=170&type=chunk) [Note 3 Revenue](index=15&type=section&id=Note%203%20Revenue) Disaggregated Net Sales by Channel (Three months ended October 31) | Channel | 2021 | 2020 | | :--- | :--- | :--- | | Wholesale - distributors | 68.5 % | 73.1 % | | Wholesale - California direct to retail | 16.4 % | 14.3 % | | DTC | 15.1 % | 12.6 % | Deferred Revenue (Contract Liabilities) (in thousands) | Date | Balance | | :--- | :--- | | October 31, 2021 | $3,933 | | July 31, 2021 | $3,102 | | Revenue recognized from opening balance (3 months ended Oct 31, 2021) | $2,000 | [Note 4 Inventories](index=16&type=section&id=Note%204%20Inventories) Inventories (in thousands) | Category | October 31, 2021 | July 31, 2021 | | :--- | :--- | :--- | | Finished goods | $112,438 | $121,423 | | Work in progress | $191,076 | $134,847 | | Raw materials | $15,710 | $11,467 | | **Total** | **$319,224** | **$267,737** | *Note: Finished goods include Bottled wine and Merchandise. Work in progress includes Bulk wine, Packaging, and Overhead* - Depreciation of **$2.6 million** was capitalized into inventory for the three months ended October 31, 2021[50](index=50&type=chunk) [Note 5 Property and Equipment](index=16&type=section&id=Note%205%20Property%20and%20Equipment) Property and Equipment, Net (in thousands) | Category | October 31, 2021 | July 31, 2021 | | :--- | :--- | :--- | | Land | $120,063 | $120,063 | | Buildings and improvements | $68,638 | $68,616 | | Vineyards and improvements | $29,164 | $29,164 | | Machinery and equipment | $50,711 | $49,607 | | Barrels | $24,654 | $26,349 | | Construction in progress | $10,834 | $5,682 | | **Total Property and equipment, net** | **$244,397** | **$240,939** | - Depreciation expense was **$0.3 million** for both the three months ended October 31, 2021, and 2020[51](index=51&type=chunk) [Note 6 Other Intangible Assets](index=16&type=section&id=Note%206%20Other%20Intangible%20Assets) Other Intangible Assets, Net (in thousands) | Category | October 31, 2021 | July 31, 2021 | | :--- | :--- | :--- | | Definite-lived intangible assets, net | $57,726 | $59,647 | | Indefinite-lived intangible assets, net | $140,900 | $140,900 | | **Total other intangible assets, net** | **$198,626** | **$200,547** | *Note: Definite-lived assets include Customer relationships and Leasehold interests. Indefinite-lived assets include Trade names and Lane rights* - Amortization expense was **$1.9 million** for both the three months ended October 31, 2021, and 2020[53](index=53&type=chunk) - The Company anticipates annual amortization of definite-lived intangible assets to be **$7.7 million** for the next five years[53](index=53&type=chunk) [Note 7 Accrued Expenses](index=18&type=section&id=Note%207%20Accrued%20Expenses) Accrued Expenses (in thousands) | Category | October 31, 2021 | July 31, 2021 | | :--- | :--- | :--- | | Trade spend | $15,920 | $10,734 | | Bulk wine and other received not invoiced | $15,571 | $1,526 | | Barrel purchase | $998 | $936 | | Deferred compensation liability | $2,631 | $2,096 | | Income tax payable | $3,921 | $0 | | Accrued invoices and other accrued expenses | $11,649 | $6,265 | | **Total** | **$50,690** | **$21,557** | [Note 8 Debt](index=18&type=section&id=Note%208%20Debt) - The Company was in compliance with all financial covenants under its Credit Facility as of October 31, 2021[56](index=56&type=chunk) - Amortization related to debt issuance costs was **$0.4 million** for both the three months ended October 31, 2021, and 2020[57](index=57&type=chunk) - As of October 31, 2021, **$314.0 million** was available to draw under the revolving line of credit, with a weighted-average interest rate of **2.0%** on the outstanding amount[58](index=58&type=chunk) [Note 9 Derivative Instruments](index=18&type=section&id=Note%209%20Derivative%20Instruments) - The Company uses interest rate swap agreements and foreign currency forward contracts to manage exposure to interest rates and foreign currency movements, but does not apply hedge accounting[59](index=59&type=chunk)[61](index=61&type=chunk) Derivative Instruments Notional Amounts (in thousands) | Instrument | October 31, 2021 | July 31, 2021 | | :--- | :--- | :--- | | Interest rate swap contracts | $100,000 | $100,000 | | Foreign currency forward contracts | $0 | $2,369 | | **Total** | **$100,000** | **$102,369** | Fair Value and Gains/Losses of Derivative Instruments (in thousands) | Metric | October 31, 2021 | July 31, 2021 | 3 months ended Oct 31, 2021 (Gain/Loss) | 3 months ended Oct 31, 2020 (Gain/Loss) | | :--- | :--- | :--- | :--- | :--- | | Interest rate swap contracts (Fair Value) | $(34) | $(480) | N/A | N/A | | Foreign currency forward contracts (Fair Value) | $0 | $5 | N/A | N/A | | Interest rate swap contracts (Gain/Loss) | N/A | N/A | $(446) | $(1,666) | | Foreign currency forward contracts (Gain/Loss) | N/A | N/A | $4 | $118 | | **Total Gains/Losses** | N/A | N/A | **$(442)** | **$(1,548)** | [Note 10 Fair Value Measurements](index=21&type=section&id=Note%2010%20Fair%20Value%20Measurements) - The Company applies a fair value hierarchy (Level 1, 2, 3) for financial instruments, with most measurements using **Level 2 inputs** (observable market data)[65](index=65&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk)[69](index=69&type=chunk) Assets and Liabilities Measured at Fair Value (in thousands, Level 2 inputs) | Item | October 31, 2021 | July 31, 2021 | | :--- | :--- | :--- | | Deferred compensation plan asset | $1,764 | $1,719 | | Interest rate swap contracts (liability) | $34 | $480 | | Deferred compensation liability | $2,631 | $2,096 | | Foreign currency forward contracts (asset) | $0 | $5 | [Note 11 Commitments and Contingencies](index=22&type=section&id=Note%2011%20Commitments%20and%20Contingencies) - The Company leases approximately **150 acres** of vineyard property, office space, and visitor centers under operating lease agreements expiring through December 2040[71](index=71&type=chunk) Future Minimum Operating Lease Payments (in thousands) | Fiscal Year | Amount | | :--- | :--- | | Remaining portion of 2022 | $4,122 | | 2023 | $4,124 | | 2024 | $4,082 | | 2025 | $3,962 | | 2026 | $2,637 | | Thereafter | $10,069 | | **Total** | **$28,996** | - The Company contracted for approximately **34,000 tons of grapes at a cost of $68.1 million** for Fiscal 2022, a significant increase from 12,000 tons at $26.5 million for Fiscal 2021[73](index=73&type=chunk) - As of October 31, 2021, there were **no material contingent obligations** requiring accrual or disclosure[76](index=76&type=chunk) [Note 12 Equity-Based Compensation](index=23&type=section&id=Note%2012%20Equity-Based%20Compensation) - On August 1, 2021, **133,076 restricted shares vested** with a total fair value of $1.9 million; 266,158 shares are set to vest on August 1, 2022[78](index=78&type=chunk) [Note 13 Casualty Loss](index=23&type=section&id=Note%2013%20Casualty%20Loss) - Wildfires in Q1 Fiscal 2021 caused smoke exposure to unharvested grapes, but the Company's owned/leased vineyards were not damaged[79](index=79&type=chunk) - Casualty loss expenses were **immaterial** for the three months ended October 31, 2021[79](index=79&type=chunk) [Note 14 Earnings Per Share](index=23&type=section&id=Note%2014%20Earnings%20Per%20Share) Earnings Per Share Reconciliation (in thousands, except share and per share amounts) | Metric | Three months ended Oct 31, 2021 | Three months ended Oct 31, 2020 | | :--- | :--- | :--- | | Net income attributable to The Duckhorn Portfolio, Inc | $21,273 | $17,523 | | Weighted average shares of common stock outstanding - basic | 115,046,793 | 101,713,460 | | Dilutive stock options and restricted stock | 349,233 | 0 | | Weighted average shares of common stock outstanding - assuming dilution | 115,396,026 | 101,713,460 | | Basic EPS | $0.18 | $0.17 | | Diluted EPS | $0.18 | $0.17 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides an overview of the business, an analysis of financial results, and discusses liquidity and capital resources [Overview](index=25&type=section&id=Overview) - The Duckhorn Portfolio is the premier scaled producer of luxury wines in North America, focusing on wines priced **$15 or higher** per 750ml bottle[86](index=86&type=chunk) - The company sells wines in all 50 states and over 50 countries, with prices ranging from **$20 to $200 per bottle**, under brands like Duckhorn Vineyards, Decoy, and Kosta Browne[87](index=87&type=chunk) - The omni-channel sales model includes wholesale and DTC, with DTC comprising approximately **15% of net sales** in the first three months of Fiscal 2022[88](index=88&type=chunk) [Key financial metrics](index=25&type=section&id=Key%20financial%20metrics) Key Financial Metrics (in thousands) | Metric | Three months ended Oct 31, 2021 | Three months ended Oct 31, 2020 | | :--- | :--- | :--- | | Net sales | $104,181 | $91,638 | | Gross profit | $52,410 | $44,275 | | Net income attributable to The Duckhorn Portfolio, Inc | $21,273 | $17,523 | | Adjusted EBITDA | $38,089 | $33,722 | Adjusted EBITDA Reconciliation (in thousands) | Metric | Three months ended Oct 31, 2021 | Three months ended Oct 31, 2020 | | :--- | :--- | :--- | | Net income attributable to The Duckhorn Portfolio, Inc | $21,273 | $17,523 | | Interest expense | $1,606 | $3,580 | | Income tax expense | $7,377 | $6,136 | | Depreciation and amortization expense | $4,829 | $5,116 | | EBITDA | $35,085 | $32,355 | | Purchase accounting adjustments | $193 | $561 | | Transaction expenses | $1,745 | $0 | | Change in fair value of derivatives | $(442) | $(1,548) | | Equity-based compensation | $1,459 | $288 | | Loss on debt extinguishment | $0 | $272 | | IPO preparation costs | $0 | $196 | | Wildfire costs | $49 | $1,555 | | COVID-19 costs | $0 | $43 | | **Adjusted EBITDA** | **$38,089** | **$33,722** | [Key operating metrics](index=27&type=section&id=Key%20operating%20metrics) Net Sales Percentage by Channel (Three months ended October 31) | Channel | 2021 | 2020 | | :--- | :--- | :--- | | Wholesale - distributors | 68.5 % | 73.1 % | | Wholesale - California direct to retail | 16.4 % | 14.3 % | | DTC | 15.1 % | 12.6 % | Net Sales Growth Contribution (Three months ended October 31) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Net sales growth | 13.7 % | 26.0 % | | Volume contribution | 7.5 % | 39.8 % | | Price / mix contribution | 6.2 % | (13.8)% | - Net sales growth in 2021 was driven by **strong sales volume growth and a positive price/mix contribution**, indicating a shift back toward pre-COVID-19 trends[104](index=104&type=chunk) [Components of results of operation and key factors affecting our performance](index=28&type=section&id=Components%20of%20results%20of%20operation%20and%20key%20factors%20affecting%20our%20performance) - Net sales growth is driven by leveraging brand strength, targeted portfolio evolution, distribution expansion, DTC channel investment, and strategic acquisitions[109](index=109&type=chunk) - The diversified sourcing model, with over **85% of production sourced from third-party growers and bulk wine**, allows for optimizing gross profit[120](index=120&type=chunk) - The COVID-19 pandemic initially shifted sales from on-premise ultra-luxury to off-premise luxury wines, but on-premise and e-commerce sales are expected to remain strong[131](index=131&type=chunk)[132](index=132&type=chunk) - Wildfires in Fiscal 2021 caused smoke exposure to grapes, but the company mitigated the impact and believes the **future operational impact will be immaterial**[133](index=133&type=chunk)[134](index=134&type=chunk) - Purchase accounting adjustments from prior acquisitions resulted in lower pre-tax income due to reduced revenue and increased costs[134](index=134&type=chunk)[136](index=136&type=chunk) [Results of operations](index=33&type=section&id=Results%20of%20operations) Consolidated Results of Operations (in thousands, except percentages) | Metric | Three months ended Oct 31, 2021 | % of Net Sales (2021) | Three months ended Oct 31, 2020 | % of Net Sales (2020) | | :--- | :--- | :--- | :--- | :--- | | Net sales | $104,181 | 100.0 % | $91,638 | 100.0 % | | Cost of sales | $51,771 | 49.7 % | $47,363 | 51.7 % | | Gross profit | $52,410 | 50.3 % | $44,275 | 48.3 % | | Selling, general, and administrative expenses | $23,158 | 22.2 % | $16,805 | 18.3 % | | Casualty loss | $49 | 0.0 % | $1,555 | 1.7 % | | Income from operations | $29,203 | 28.0 % | $25,915 | 28.3 % | | Interest expense | $1,606 | 1.5 % | $3,580 | 3.9 % | | Other (income) expense, net | $(1,093) | (1.0)% | $(1,323) | (1.4)% | | Total other expenses | $513 | 0.5 % | $2,257 | 2.5 % | | Income before income taxes | $28,690 | 27.5 % | $23,658 | 25.8 % | | Income tax expense | $7,377 | 7.1 % | $6,136 | 6.7 % | | Net income attributable to The Duckhorn Portfolio, Inc | $21,273 | 20.4 % | $17,523 | 19.1 % | - Net sales increased by **$12.5 million (13.7%)** to $104.2 million, driven by volume growth and positive price/mix contribution[138](index=138&type=chunk) - Gross profit increased by **$8.1 million (18.4%)** to $52.4 million, with gross profit margin improving to **50.3% from 48.3%**[140](index=140&type=chunk) - Selling, general and administrative expenses increased by **$6.4 million (37.8%)** to $23.2 million, due to expanded workforce, higher equity-based compensation, and public company costs[141](index=141&type=chunk) - Casualty loss decreased by **$1.5 million (96.8%)** to $49k, as the prior year included significant wildfire-related costs[144](index=144&type=chunk) - Total other expenses decreased by **$1.7 million (77.3%)** to $0.5 million, mainly due to lower interest expense and a gain on interest rate swaps[145](index=145&type=chunk) [Liquidity and capital resources](index=35&type=section&id=Liquidity%20and%20capital%20resources) - The Company's primary cash needs are for working capital and expenditures, funded by operating cash flows and its Credit Facility[147](index=147&type=chunk) - As of October 31, 2021, the Company had **$5.2 million in cash** and **$314.0 million available** on its revolving line of credit[147](index=147&type=chunk) - Net cash provided by operating activities increased by **$20.2 million to $22.7 million** for the three months ended October 31, 2021[155](index=155&type=chunk) - Net cash used in financing activities shifted to **$15.8 million** for the three months ended October 31, 2021, compared to $0.3 million provided in the prior year[157](index=157&type=chunk) - Outstanding principal balances on debt instruments as of October 31, 2021, included **$111.0 million** for the revolving line of credit and **$115.8 million** for term loans[159](index=159&type=chunk) [Off-balance sheet arrangements](index=38&type=section&id=Off-balance%20sheet%20arrangements) - As of October 31, 2021, the Company did not have any off-balance sheet arrangements that had, or are reasonably likely to have, a material effect on its financial condition[166](index=166&type=chunk) [Critical accounting policies and estimates](index=38&type=section&id=Critical%20accounting%20policies%20and%20estimates) - There have been **no material changes** in the Company's critical accounting policies during the three months ended October 31, 2021[168](index=168&type=chunk) [Recent accounting pronouncements](index=38&type=section&id=Recent%20accounting%20pronouncements) - Refer to Note 2 (Basis of presentation and significant accounting policies) for additional information regarding recent accounting pronouncements[169](index=169&type=chunk) [Emerging growth company status](index=38&type=section&id=Emerging%20growth%20company%20status) - The Company is an 'emerging growth company' and has elected to use the extended transition period for complying with new or revised accounting standards[170](index=170&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section outlines the company's exposure to market risks including interest rates, inflation, and commodity prices [Interest rates](index=38&type=section&id=Interest%20rates) - The Company is exposed to interest rate risk from **$231.9 million** in outstanding variable-rate borrowings as of October 31, 2021[172](index=172&type=chunk) - A **100 basis point increase** in the effective interest rate would result in a **$2.3 million** increase in annual interest expense[172](index=172&type=chunk) - The Company uses an interest rate swap to mitigate exposure to fluctuations in interest rates[172](index=172&type=chunk) [Inflation](index=39&type=section&id=Inflation) - Inflation has **not had a material impact** on the Company's business, results of operations, or financial condition to date[174](index=174&type=chunk) - The Company monitors inflation and attempts to minimize its effects through pricing strategies and cost reductions[174](index=174&type=chunk) [Foreign currency](index=39&type=section&id=Foreign%20currency) - Revenues and costs are primarily denominated in U.S dollars, **limiting significant foreign exchange risk**[175](index=175&type=chunk) - The Company uses foreign exchange forward contracts to offset risks associated with Euro-denominated barrel purchases, with no outstanding contracts as of October 31, 2021[175](index=175&type=chunk) [Commodity prices](index=39&type=section&id=Commodity%20prices) - The primary commodity risk is grapes, with over **85% sourced from third-party suppliers**, and prices are subject to factors like yield, demand, and weather[177](index=177&type=chunk) - The Company diversifies its sources of supply and negotiates prices for raw materials but does not engage in commodity hedging[177](index=177&type=chunk)[178](index=178&type=chunk) [Item 4. Controls and procedures](index=39&type=section&id=Item%204.%20Controls%20and%20procedures) This section details the evaluation of disclosure controls and procedures and changes in internal control over financial reporting [Disclosure controls and procedures](index=39&type=section&id=Disclosure%20controls%20and%20procedures) - Management, including the CEO and CFO, evaluated the effectiveness of disclosure controls and procedures as of October 31, 2021[180](index=180&type=chunk) - It was concluded that disclosure controls and procedures were **effective in providing reasonable assurance** that information required for SEC reports is timely and accurately reported[180](index=180&type=chunk)[181](index=181&type=chunk) [Changes in internal control over financial reporting](index=40&type=section&id=Changes%20in%20internal%20control%20over%20financial%20reporting) - There were **no changes** in internal control over financial reporting that materially affected, or are reasonably likely to materially affect, the Company's internal control[182](index=182&type=chunk) [Limitations on the effectiveness of controls](index=40&type=section&id=Limitations%20on%20the%20effectiveness%20of%20controls) - Disclosure controls and internal control over financial reporting are designed to provide **reasonable, not absolute, assurance** of achieving their objectives[183](index=183&type=chunk) - Management does not expect that control systems will prevent or detect all error and fraud[183](index=183&type=chunk) PART II [Item 1. Legal proceedings](index=41&type=section&id=Item%201.%20Legal%20proceedings) The company is involved in routine legal proceedings not expected to have a material adverse effect on the business - The Company is involved in various legal proceedings arising from the normal course of business activities[186](index=186&type=chunk) - No current litigation is believed to have a **material adverse effect** on the Company's business, operating results, cash flows, or financial condition[186](index=186&type=chunk) [Item 1A. Risk factors](index=41&type=section&id=Item%201A.%20Risk%20factors) This section refers to the risk factors detailed in the Fiscal 2021 Annual Report on Form 10-K - For a discussion of potential risks and uncertainties, refer to the 'Risk Factors' section in the Annual Report on Form 10-K for Fiscal 2021[187](index=187&type=chunk) - There have been **no material changes** in risk factors since the previous 10-K filing[187](index=187&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including officer certifications and XBRL data - Exhibits include certifications from the CEO and CFO (pursuant to Sarbanes-Oxley Act) and various XBRL documents[188](index=188&type=chunk) [Signatures](index=42&type=section&id=Signatures) This section contains the official signatures certifying the submission of the report - The report was signed on December 8, 2021, by Alex Ryan (President, CEO and Chairman) and Lori Beaudoin (EVP, CFO and Principal Accounting Officer)[192](index=192&type=chunk)

The Duckhorn Portfolio, Inc. (NYSE:NAPA) Q4 2021 Earnings Conference Call October 4, 2021 5:00 PM ET Company Participants Sean Sullivan - EVP, Chief Administrative Officer and General Counsel Alex Ryan - President, Chief Executive Officer and Chairman Lori Beaudoin - Chief Financial Officer Conference Call Participants Peter Galbo - Bank of America Wendy Nicholson - Citi Lauren Lieberman - Barclays Kevin Grundy - Jefferies Andrea Teixeira - JP Morgan Kaumil Gajrawala - Credit Suisse Disclaimer*: This transc ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended July 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 001-40240 The Duckhorn Portfolio, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Delaware 81-386630 ...

The Duckhorn Portfolio, Inc. (NYSE:NAPA) Q3 2021 Earnings Conference Call June 7, 2021 5:00 PM ET Company Participants Sean Sullivan - EVP, Chief Administrative Officer and General Counsel Alex Ryan - President, Chief Executive Officer and Chairman Lori Beaudoin - Chief Financial Officer Conference Call Participants Kevin Grundy - Jefferies Kaumil Gajrawala - Credit Suisse Andrea Teixeira - JPMorgan Peter Galbo - Bank of America Wendy Nicholson - Citi Nik Modi - RBC Capital Markets Lauren Lieberman - Barcla ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 001-40240 The Duckhorn Portfolio, Inc. (Exact name of registrant as specified in its charter) Delaware 81-3866305 (State or other jurisdiction of incorporation or org ...