Fresh Vine Sales Rise 8.5% in Quarter, But Net Loss Widens 67%

Fresh Vine Wine reports net sales in the third quarter totaled $535,584, up from $526,621.  The company's net loss widened to $2.56 million from $1.53 million.  

In a press release, the company said it was reorganizing to "position the company for continued growth while conserving cash."  The reorganization includes outsourcing the sales function, a move which converted most of the company's sales expense to a variable cost from a fixed.  

It also entered into a contract with a marketing agency "to completely overhaul the company’s marketing strategy and plan, primarily intended to better leverage the company’s tremendous assets, including celebrity ownership, to grow the Company’s Direct-to-Consumer business."

In its Form 10-Q filed with the Securities & Exchange Commission Fresh Vine makes clear the stress the company currently faces.  It  noted it currently has no debt, but plan s to seek debt or equity financing to sustain existing operations.  It has enough cash on hand to sustain operations into the first quarter of 2024, it added.  But, if it can't raise additional working capital, it may be necessary to "potentially ceasing operations altogether."

It has already implemented cost reduction efforts that have "reduced the company's budgeted cash requirement by more than $6.3 million for the second half of 2022, preserving capital for our highest priority expenses and investments and providing additional runway for the growth strategy to gain traction in market."

Meanwhile, it is opening new distributor and retail relationships, expanding to new geographic markets and introducing new product extensions.  "The company believes they efforts will accelerate top-line growth in ways that will improve liquidity measures as the company converts liquidity to cash."