Splash(US:SBEV)2022-05-16 18:30Financial Performance - Net revenues for the three months ended March 31, 2022, were $3.93 million, a 83.5% increase from $2.14 million in the same period of 2021[13] - Gross profit for Q1 2022 was $832,002, compared to $517,420 in Q1 2021, reflecting a 60.7% increase[13] - The net loss for the three months ended March 31, 2022, was $5.99 million, compared to a net loss of $4.44 million in the same period of 2021, indicating a 35% increase in losses[13] - Total revenues for the three months ended March 31, 2022, were $3,926,573, representing a 83% increase from $2,138,924 in the same period of 2021[104] - The net loss for the three months ended March 31, 2022, was $5,994,407, compared to a net loss of $4,442,219 for the same period in 2021[105] Assets and Liabilities - Total assets increased to $20.61 million as of March 31, 2022, up from $16.39 million at December 31, 2021, representing a growth of 25.5%[10] - Cash and cash equivalents at the end of Q1 2022 were $8.50 million, up from $4.18 million at the beginning of the year, marking a 103.5% increase[17] - The accumulated deficit increased to $96.63 million as of March 31, 2022, from $90.64 million at the end of 2021, reflecting a growth in losses[15] - Total notes payable decreased from $2,967,812 as of December 31, 2021, to $2,171,068 as of March 31, 2022, reflecting a reduction of approximately 27%[64] - Total operating lease liability as of March 31, 2022, is $953,065, with a current portion of $284,372[87] Operating Expenses - Total operating expenses rose to $6.52 million in Q1 2022, up from $5.07 million in Q1 2021, an increase of 28.8%[13] - Operating expenses increased by $1,449,606 to $6,515,955 for the three months ended March 31, 2022, primarily due to warrant expenses, marketing, and shipping costs[105] - Interest expense on notes payable increased to $81,700 for the three months ended March 31, 2022, compared to $9,625 for the same period in 2021, representing a significant increase of 748%[65] Inventory and Receivables - Accounts receivable net of allowances were $13,949 as of March 31, 2022, down from $45,203 as of December 31, 2021[33] - The company’s inventory reserve increased to $253,703 as of March 31, 2022, compared to $223,223 as of December 31, 2021[34] - The company recorded a reserve for excess inventory based on management's estimates of forecast turnover, indicating proactive inventory management strategies[34] Shareholder Information - The company reported a weighted average of 35,188,404 common shares outstanding for continuing operations in Q1 2022, compared to 24,642,532 in Q1 2021, an increase of 42.7%[13] - The company issued 550,000 shares of common stock in exchange for services and 2,300,000 shares as part of S3 drawdown and convertible instruments during the three months ended March 31, 2022[72] - The total number of shares issuable under the 2020 Stock Incentive Plan increased by 1,679,812 shares as of January 1, 2022, reflecting the plan's "EVERGREEN" feature[76] Business Operations - Splash Beverage Group is expanding its distribution system to select international markets, enhancing its portfolio of beverage brands[21] - The company initiated a plan to divest its Canfield Medical Supply, Inc. business, which is now reflected as discontinued operations[22] - The company completed the acquisition of CdV for a total consideration of approximately $6.0 million, including $2.0 million in cash and $2.0 million in contingent shares[89] - The increase in sales was attributed to a $505,105 contribution from CdV and a $1,135,233 increase from the Qplash e-commerce platform[104] Compliance and Certifications - The report includes certifications from the CEO and CFO as required by regulations[134] - The report was signed by Robert Nistico, Chairman and CEO, and Ron Wall, CFO, on May 16, 2022[138] - The company has no material uncertain tax positions as of March 31, 2022, and December 31, 2021[49] Asset Management - The company evaluates long-lived assets for impairment annually, ensuring asset values are recoverable based on future cash flows[58] - Depreciation expense for the three months ended March 31, 2022, was $30,695, a decrease from $43,487 for the same period in 2021[36] - Total property, plant, and equipment net value decreased to $542,535 as of March 31, 2022, from $569,785 as of December 31, 2021[36]