Splash(US:SBEV)2025-11-19 21:15Financial Performance - Net revenues for the three months ended September 30, 2025, were $981,858, a significant increase from $438,272 in the same period of 2024[14]. - Gross profit for the nine months ended September 30, 2025, was $699,064, compared to a loss of $30,443 in the same period of 2024[14]. - Net loss for the three months ended September 30, 2025, was $9.89 million, compared to a loss of $4.72 million in the same period of 2024[14]. - The company reported a basic and diluted loss per share of $4.51 for the three months ended September 30, 2025[14]. - The net loss for the nine months ended September 30, 2025, was $9,886,045, compared to a net loss of $4,719,563 for the same period in 2024, indicating an increase in losses[20]. - The company reported a loss from continuing operations of $(22,029,577) for the nine months ended September 30, 2025, compared to $(14,717,161) for the same period in 2024[130]. - The total operating loss for Splash Beverage was $(9,290,206) for the three months ended September 30, 2025, compared to $(1,719,038) for the same period in 2024, indicating a deterioration in performance[130]. Assets and Liabilities - Total assets increased to $22.49 million as of September 30, 2025, compared to $2.76 million on December 31, 2024[11]. - Cash and cash equivalents increased to $265,667 as of September 30, 2025, from $15,346 on December 31, 2024[11]. - Total current liabilities decreased to $15.64 million as of September 30, 2025, from $19.37 million on December 31, 2024[11]. - Total liabilities increased from $146,792,889 at December 31, 2024, to $178,284,467 at September 30, 2025, reflecting a growing debt burden[20]. - The company reported total assets of $185,025,450, with total liabilities amounting to $178,284,467, resulting in a shareholders' equity of $6,777,552 as of September 30, 2025[20]. Equity and Stock Transactions - Total stockholders' equity improved to $6.78 million as of September 30, 2025, from a deficiency of $18.63 million on December 31, 2024[11]. - The company issued common stock for convertible notes amounting to $135,000 during the quarter[18]. - The company issued 20,000 shares of preferred stock for the acquisition of water rights, valued at $20,000,000[19]. - The company issued 55,500 shares valued at $141,595 in exchange for services during the nine months ended September 30, 2025[94]. - The Company has issued four series of preferred stock, with distinct rights and preferences outlined in the financial statements[96]. Cash Flow and Operating Activities - Net cash used in operating activities for 2025 was $3,828,797, a decrease from $6,383,464 in 2024, reflecting an improvement of approximately 40%[22]. - The company reported cash and cash equivalents of $265,667 at the end of the period in 2025, down from $456,887 in 2024, representing a decline of about 42%[22]. - The Company has not generated any revenue since March 2025 and requires at least $2,000,000 of working capital to resume minimal operations[167]. - The company reported a cash flow statement for the nine months ended September 30, 2025, indicating ongoing operational activities[21]. Debt and Financing - The company entered into various eighteen-month loans totaling $800,000,000, with a 50% warrant coverage[82]. - The company entered into a revenue purchase agreement amounting to $250 million, with 4% of revenue to be paid weekly until the loan is fully paid[1]. - The company entered into a commercial financing agreement for $815 million, to be paid weekly until the loan is fully repaid[83]. - The company reported a loan in default with a default rate of 46.45%[1]. - The Company issued convertible promissory notes totaling $424,560 in August 2025 and secured convertible promissory notes of $2,200,000 in September 2025 to address capital needs[167]. Strategic Initiatives and Challenges - The company plans to raise approximately $4,000,000 to fulfill a purchase order for bottled water from a customer in the UAE[27]. - The company intends to focus on the distribution of the Chispo brand tequila and the sale of water extracted from its newly acquired Water Assets[28]. - The company acknowledges that strategic initiatives, including acquisitions and divestitures, may not be successful and could divert management's attention from core operations[201]. - The company faces challenges in integrating the Water Assets, including hiring personnel, complying with foreign laws, and establishing production and distribution channels, which may lead to increased costs and reduced profit margins[205]. Internal Controls and Reporting - The company identified material weaknesses in internal controls over financial reporting, specifically a lack of segregation of duties and insufficient accounting personnel, leading to ineffective disclosure controls as of September 30, 2025[193]. - There were no additional changes in internal control over financial reporting during the quarter ended September 30, 2025, that materially affected the company's controls[196]. - The company performed additional analyses to ensure that consolidated financial statements fairly present its financial condition despite control deficiencies[194].