Splash Beverage Group, Inc. reported significant declines in revenue and profitability for the third quarter and the nine months ended September 30, 2024, compared to the same periods in 2023. Net revenues for Q3 2024 were approximately $981,858, a decrease of $4.1 million from $5.1 million in Q3 2023. For the nine months, revenues fell to $3.6 million from $16.2 million, marking a decline of $12.6 million. The drop in revenue was primarily attributed to a 97.6% decrease in sales from the Qplash e-commerce platform, which suffered from low inventory levels.
Gross profit for Q3 2024 was $291,019, down from $1.3 million in Q3 2023, while gross profit for the nine months decreased to $699,064 from $4.8 million. The company reported a loss from operations of $(2.7 million) for Q3 2024, an improvement from $(4.3 million) in Q3 2023. For the nine-month period, the loss from operations was $(9.6 million), compared to $(12.0 million) in the prior year. The net loss for Q3 2024 was $(4.7 million), a slight improvement from $(5.7 million) in Q3 2023, and for the nine months, the net loss was $(14.7 million), down from $(15.0 million).
Total assets as of September 30, 2024, were $8.4 million, a decrease from $9.9 million at the end of 2023. Total liabilities increased to $19.2 million from $15.5 million, resulting in total stockholders’ equity of $(10.8 million), down from $(5.6 million). The company’s cash position improved slightly, with cash and cash equivalents rising to $456,889 from $379,978 at the end of 2023.
The company secured $7.9 million from convertible promissory notes during the nine months, which contributed to a net cash provided by financing activities of $6.4 million, up from $4.4 million in the same period last year. However, there remains substantial doubt about the company’s ability to continue as a going concern without additional funding.
In terms of operational changes, Splash Beverage Group has faced legal challenges, including a lawsuit from TapouT, LLC, alleging breach of a licensing agreement, with a potential liability of $1.4 million. The company has set aside a legal reserve of $330,000 for this matter. Additionally, the company is working to enhance its internal controls over financial reporting, which have been deemed ineffective due to material weaknesses.
About SPLASH BEVERAGE GROUP, INC.
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