Gaucho Group Holdings, Inc. Announces Third Quarter Financial Results
Gaucho Group Holdings (NASDAQ:VINO) reported a significant financial turnaround in Q3 2021, achieving revenues of $2.6 million, a 4,242% increase from the previous year. The company also posted a net income of $931,000, equating to $0.11 per share, compared to a loss last year. Gross profit reached $2.4 million, up 11,505%. Working capital amounts to $6.2 million with stockholder equity at $17.6 million. The company is optimistic about its luxury real estate and e-commerce initiatives and anticipates strong growth in 2022 as consumer demand rebounds.
- Achieved first quarterly profit as a public company.
- Revenues increased to $2.6 million from $60,228, a 4,242% rise.
- Gross profit rose sharply to $2.4 million, up 11,505% year-over-year.
- Net income stood at $931,000, converting from a loss in the previous year.
- Working capital reported at $6.2 million, with stockholder equity at $17.6 million.
- Revenue recognition for real estate lots was delayed due to deeding requirements.
- Some revenues anticipated for Q4 were pushed into the next period.
Revenues Soar to
NEW YORK, NY / ACCESSWIRE / November 16, 2021 / Gaucho Group Holdings, Inc. (NASDAQ:VINO), a company that includes a growing collection of e-commerce platforms with a concentration on fine wines, luxury real estate, and leather goods and accessories, today announced financial results for the third quarter period ending September 30, 2021. Investors are encouraged to read the Company's quarterly report on Form 10-Q as filed with the Securities and Exchange Commission (the "SEC") and posted at www.gauchoholdings.com.
Financial Highlights
- Revenues for the third quarter were
$2.6 million compared to$60,228 in the prior year period, a 4,242% increase - Gross profit for the third quarter was
$2.4 million , compared to$21,000 in the prior year period, a 11,505% increase. - Net income for the third quarter was
$931,000 or$0.11 b asic earnings per share compared to loss of$0.18 per share in prior year period - Working capital of
$6.2 million - Stockholder equity rises to
$17.6 million
Commenting on the results, Scott Mathis, Chief Executive Officer of Gaucho Holdings, stated, "We are absolutely thrilled to report our first quarterly profit as a public company. Earlier this year we completed an
"Our third quarter financial results reflect early sales of real estate lots at our Algodon Wine Estates as well as a small increase in hotel, restaurant and wine sales after Argentine hotels reopened with COVID-19 measures in place. We are encouraged by the pace of lot sales occurring at Algodon Wine Estates. Recognition of revenue from these sales is contingent on deeding requirements, a process that has been made a bit more time consuming given the pandemic environment. This pushed some revenues into the fourth quarter, but we are pursuing this process as quickly as possible, and we are encouraged by the pace of lot sales that we see in the fourth quarter and the environment for ongoing sales throughout next year. Argentina officially "reopened" from Covid related shutdowns, and as the world continues to reopen, we believe we will benefit from a surge in pent up consumer demand for travel and luxury experiences. Over the years we have been opportunistic about acquiring new acreage, and our earlier engagement of architectural design firm EDSA has resulted in substantial improvements to the infrastructure and amenities of Algodon Wine Estates. Recently drilled water wells should further enhance the appeal and market value of these properties. And, lastly, as we have previously announced, we are actively seeking to partner with a 5-star hotel chain to potentially bring in an 80-120 room hotel with branded residences. If we are successful with finding a partner, we believe it can add immeasurable value and result in even stronger revenue growth at Algodon Wine Estates. We look forward to finishing the year strongly and growing even stronger in 2022."
About Gaucho Group Holdings, Inc.
For more than ten years, Gaucho Group Holdings, Inc.'s (gauchoholdings.com) mission has been to source and develop opportunities in Argentina's undervalued luxury real estate and consumer marketplace. Our company has positioned itself to take advantage of the continued and fast growth of global e-commerce across multiple market sectors, with the goal of becoming a leader in diversified luxury goods and experiences in sought after lifestyle industries and retail landscapes. With a concentration on fine wines (algodonfinewines.com & algodonwines.com.ar), hospitality (algodonhotels.com), and luxury real estate (algodonwineestates.com) associated with our proprietary Algodon brand, as well as the leather goods, ready-to-wear and accessories of the fashion brand Gaucho - Buenos Aires™ (gauchobuenosaires.com), these are the luxury brands in which Argentina finds its contemporary expression.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in our filings with the Securities and Exchange Commission and elsewhere. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.
Media Relations:
Gaucho Group Holdings, Inc.
Rick Stear
Director of Marketing
212.739.7669
rstear@gauchoholdings.com
Investor Relations:
John McNamara
917-658-2602
john@tradigitalir.com
GAUCHO GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
| September 30, | December 31, | |||||||
| 2021 | 2020 | |||||||
| (unaudited) | ||||||||
Assets | ||||||||
Current Assets | ||||||||
Cash | $ | 2,836,500 | $ | 134,536 | ||||
Accounts receivable, net of allowance of | 2,353,476 | 255,720 | ||||||
Accounts receivable - related parties, net of allowance of | 741,495 | 252,852 | ||||||
Advances to employees | 282,204 | 282,508 | ||||||
Inventory | 1,327,572 | 1,172,775 | ||||||
Real estate lots held for sale | 59,790 | 139,492 | ||||||
Operating lease right-of-use asset, current portion | 311,925 | - | ||||||
Investment | 45,182 | 53,066 | ||||||
Deposits, current | 15,269 | 35,854 | ||||||
Prepaid expenses and other current assets | 602,415 | 196,539 | ||||||
Total Current Assets | 8,575,828 | 2,523,342 | ||||||
Long Term Assets | ||||||||
Property and equipment, net | 3,396,950 | 2,860,222 | ||||||
Operating lease right-of-use asset, non-current portion | 1,396,857 | - | ||||||
Prepaid foreign taxes, net | 664,128 | 519,499 | ||||||
Investment - related parties | 3,500,000 | 457 | ||||||
Deferred offering costs | 24,000 | 67,016 | ||||||
Deposits, non-current | 56,130 | - | ||||||
Total Assets | $ | 17,613,893 | $ | 5,970,536 | ||||
GAUCHO GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
| September 30, | December 31, | |||||||
| 2021 | 2020 | |||||||
| (unaudited) | ||||||||
Liabilities, Temporary Equity and Stockholders' Equity (Deficiency) | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | 457,129 | $ | 891,168 | ||||
Accrued expenses, current portion | 451,278 | 1,401,402 | ||||||
Deferred revenue | 753,302 | 933,941 | ||||||
Operating lease liabilities, current portion | 263,292 | - | ||||||
Loans payable, current portion | 249,000 | 437,731 | ||||||
Debt obligations | 7,000 | 1,270,354 | ||||||
Investor deposits | 29,950 | 29,950 | ||||||
Other current liabilities | 130,628 | 131,895 | ||||||
Total Current Liabilities | 2,341,579 | 5,096,441 | ||||||
Long Term Liabilities | ||||||||
Accrued expenses, non-current portion | 126,103 | 169,678 | ||||||
Operating lease liabilities, non-current portion | 1,470,046 | - | ||||||
Loans payable, non-current portion | 94,000 | 310,591 | ||||||
Total Liabilities | 4,031,728 | 5,576,710 | ||||||
Commitments and Contingencies (Note 13) | ||||||||
Series B convertible redeemable preferred stock, par value 902,670 shares authorized; 0 and 901,070 issued and outstanding at September 30, 2021 and December 31, 2020, respectively | - | 9,010,824 | ||||||
Stockholders' Equity (Deficiency) | ||||||||
Preferred stock, 11,000,000 shares authorized: | ||||||||
Series A convertible preferred stock, par value 10,097,330 shares authorized; no shares are available for issuance | - | - | ||||||
Common stock, par value 8,784,618 and 5,234,406 shares issued and 8,781,249 and 5,231,037 shares outstanding as of September 30, 2021 and December 31, 2020, respectively | 87,845 | 52,344 | ||||||
Additional paid-in capital | 120,184,675 | 96,951,440 | ||||||
Accumulated other comprehensive loss | (11,598,452 | ) | (11,932,801 | ) | ||||
Accumulated deficit | (94,919,120 | ) | (93,534,828 | ) | ||||
Treasury stock, at cost, 3,369 shares at September 30, 2021 and December 31, 2020 | (46,355 | ) | (46,355 | ) | ||||
Total Gaucho Group Holdings, Inc. Stockholders' Equity (Deficiency) | 13,708,593 | (8,510,200 | ) | |||||
Non-controlling interest | (126,428 | ) | (106,798 | ) | ||||
Total Stockholders' Equity (Deficiency) | 13,582,165 | (8,616,998 | ) | |||||
Total Liabilities, Temporary Equity and Stockholders' Equity (Deficiency) | $ | 17,613,893 | $ | 5,970,536 | ||||
GAUCHO GROUP HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
Sales | $ | 2,605,158 | $ | 60,228 | $ | 3,220,557 | $ | 474,546 | ||||||||
Cost of sales | (210,437 | ) | (80,995 | ) | (650,003 | ) | (571,621 | ) | ||||||||
Gross profit (loss) | 2,394,721 | (20,767 | ) | 2,570,554 | (97,075 | ) | ||||||||||
Operating Expenses | ||||||||||||||||
Selling and marketing | 100,870 | 110,687 | 336,081 | 160,686 | ||||||||||||
General and administrative | 1,370,870 | 859,967 | 3,934,500 | 3,342,240 | ||||||||||||
Depreciation and amortization | 35,758 | 45,906 | 103,680 | 138,409 | ||||||||||||
Gain from insurance settlement | - | (30,240 | ) | - | (30,240 | ) | ||||||||||
Total operating expenses | 1,507,498 | 986,320 | 4,374,261 | 3,611,095 | ||||||||||||
Income (Loss) From Operations | 887,223 | (1,007,087 | ) | (1,803,707 | ) | (3,708,170 | ) | |||||||||
Other Expense (Income) | ||||||||||||||||
Interest expense, net | 49,646 | 72,459 | 88,209 | 193,595 | ||||||||||||
Forgiveness of PPP Loan | - | - | (242,486 | ) | - | |||||||||||
Gain on debt restructuring | - | (130,421 | ) | - | (130,421 | ) | ||||||||||
Other income | (87,500 | ) | - | (87,500 | ) | - | ||||||||||
Gains from foreign currency translation | (6,130 | ) | (14,826 | ) | (34,991 | ) | (35,316 | ) | ||||||||
Total other (income) expense | (43,984 | ) | (72,788 | ) | (276,768 | ) | 27,858 | |||||||||
Net Income (Loss) | 931,207 | (934,299 | ) | (1,526,939 | ) | (3,736,028 | ) | |||||||||
Net loss attributable to non-controlling interest | 45,086 | 32,838 | 142,647 | 128,355 | ||||||||||||
Series B preferred stock dividends | - | (178,094 | ) | - | (540,217 | ) | ||||||||||
Net Income (Loss) Attributable to Common Stockholders | $ | 976,293 | $ | (1,079,555 | ) | $ | (1,384,292 | ) | $ | (4,147,890 | ) | |||||
Earnings (Loss) Per Common Share - Basic and Diluted | ||||||||||||||||
Basic | $ | 0.11 | $ | (0.26 | ) | $ | (0.18 | ) | $ | (1.02 | ) | |||||
Diluted | $ | 0.11 | $ | (0.26 | ) | $ | (0.18 | ) | $ | (1.02 | ) | |||||
Shares used in computing earnings per share: | ||||||||||||||||
Basic | 8,658,395 | 4,110,303 | 7,530,833 | 4,049,059 | ||||||||||||
Diluted | 8,658,395 | 4,110,303 | 7,530,833 | 4,049,059 | ||||||||||||
Net income (loss) | $ | 931,207 | $ | (934,299 | ) | $ | (1,526,939 | ) | $ | (3,736,028 | ) | |||||
Other comprehensive income (loss): | ||||||||||||||||
Foreign currency translation adjustments | 98,709 | (17,837 | ) | 334,349 | 400,686 | |||||||||||
Comprehensive income (loss) | 1,029,916 | (952,136 | ) | (1,192,590 | ) | (3,335,342 | ) | |||||||||
Comprehensive loss attributable to non-controlling interests | 45,086 | 32,838 | 142,647 | 128,355 | ||||||||||||
Comprehensive income (loss) attributable to controlling interests | $ | 1,075,002 | $ | (919,298 | ) | $ | (1,049,943 | ) | $ | (3,206,987 | ) | |||||
SOURCE: Gaucho Group Holdings, Inc.
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