SCHEID FAMILY WINES REPORTS THIRD QUARTER FISCAL 2025 RESULTS

Rhea-AI Summary

Scheid Family Wines (SVIN) reported financial results for Q3 fiscal 2025, showing significant revenue decline and increased losses. Total revenues dropped 17% to $43.3 million, with cased goods sales down 6% to $32.2 million. The company faced multiple challenges including:

- Bulk wine sales decreased 22% to $2.1 million
- Grape sales fell 23% to $1.0 million
- Winery processing revenues declined 50% to $5.2 million
- Gross margins decreased to 26% from 30%
- Interest expense surged 146% to $11.8 million

The company reported a net loss of $6.8 million compared to $1.8 million loss in the previous year. EBITDA increased to $8.5 million from $6.2 million, primarily due to one-time gains from a processing agreement termination ($3.6 million) and land sale ($1.7 million). The 2024 harvest yields were approximately 15% below the company's five-year average.

Positive

• EBITDA increased to $8.5 million from $6.2 million
• One-time gain of $3.6 million from processing agreement termination
• Additional $1.7 million gain from non-vineyard land sale
• Sales and marketing expenses reduced by 18% to $6.8 million
• General and administrative expenses decreased 6% to $5.0 million

Negative

• Total revenues declined 17% to $43.3 million
• Net loss increased to $6.8 million from $1.8 million
• Interest expense surged 146% to $11.8 million due to default rates averaging 14.2%
• Gross margins decreased to 26% from 30%
• Winery processing revenues dropped 50% to $5.2 million
• 2024 harvest yields 15% below five-year average
• Bulk wine market remains oversupplied with reduced prices

SALINAS, Calif., Jan. 20, 2025 /PRNewswire/ -- Scheid Vineyards Inc. (dba Scheid Family Wines) (OTC Markets: SVIN) announced today its financial results for the nine months ended November 30, 2024 (third quarter of fiscal 2025).

Financial Results

Total revenues decreased 17%, to $43.3 million for the nine months ended November 30, 2024, from $52.4 million in fiscal 2024. Cased goods sales decreased 6%, to $32.2 million in the first nine months of fiscal 2025, from $35.2 million in fiscal 2024, as the bottled wine business across the entire market slowed in calendar 2024. The Company's bulk wine sales decreased 22%, to $2.1 million from $2.7 million, and grape sales decreased 23%, to $1.0 million from $1.3 million. Revenues from winery processing and storage decreased 50%, to $5.2 million from $10.4 million as the result of the dissolution of a winery processing contract and a lighter than usual 2024 harvest. Gross margins decreased to 26% from 30%, primarily from a reduction in bulk wine sales prices. Industrywide, the bulk wine market continues to be over-supplied, leading to slower sales as well as reduced prices.

Sales and marketing expenses decreased 18%, to $6.8 million from $8.3 million, and general and administrative expenses decreased 6%, to $5.0 million from $5.3 million.

During the first quarter of fiscal 2025, the Company recognized revenue of $3.6 million from proceeds received from the early termination of a winery processing agreement. During the second quarter of fiscal 2025, the Company recognized a gain from the sale of non-vineyard land in the amount of $1.7 million.

Interest expense rose 146%, to $11.8 million from $4.8 million, due to increases in interest rates as each of the Company's lenders are accruing interest at the default rate of an average of 14.2%.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) increased to $8.5 million from $6.2 million, primarily from the proceeds from the early termination of a processing agreement and land sale.

In total, the Company reported a net loss of $6.8 million for the nine months ended November 30, 2024, compared to a net loss of $1.8 million for the nine months ended November 30, 2023.

2024 Harvest Update

The Company's 2024 grape harvest was completed on October 30, 2024. Overall yields were approximately 15% below the Company's five-year average yields and are generally consistent with wine grape yields from Monterey and other California coastal vineyard regions.

SCHEID VINEYARDS INC. AND SUBSIDIARY
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
NINE MONTHS ENDED NOVEMBER 30, 2024 AND 2023
(amounts in thousands, except per share data)
						Nine Months Ended November 30,
						2024			2023
REVENUES:
Cased goods sales						$	32,177		$	35,228
Bulk wine sales						2,085			2,696
Winery processing and storage revenues						5,190			10,362
Grape sales						1,030			1,321
Direct sales revenues						2,350			2,286
Vineyard management revenues						467			536
Other revenues						9			10
Total revenues						43,308			52,439
COST OF SALES						(31,877)			(36,578)
GROSS PROFIT						11,431			15,861
Sales and marketing expenses						(6,790)			(8,348)
General and administrative expenses						(4,970)			(5,258)
OPERATING (LOSS) INCOME						(329)			2,255
Interest expense, net						(11,783)			(4.787)
Proceeds from termination of processing agreement						3,613			—
Gain on sale of property, plant and equipment						1,715			80
Other income (loss)						9			(40)
LOSS BEFORE BENEFIT FROM INCOME TAXES						(6,775)			(2,492)
BENEFIT FROM INCOME TAXES						—			713
NET LOSS						$	(6,775)		$	(1,779)
NET LOSS PER SHARE						$	(7.39)		$	(1.94)
WEIGHTED AVERAGE SHARES OUTSTANDING						917			915

 

About Scheid Family Wines

Scheid Family Wines, a family-owned and operated wine company for over 50 years, is ranked among the top 25 largest wine producers in the United States. Based in Monterey County, California, Scheid is vertically integrated to bring high quality estate grown wines to the marketplace from its sustainably and organically certified vineyards and grower partners throughout the Central Coast. Scheid's innovative, luxury-level winery is 100% powered by renewable wind energy generated by a 400-foot-tall wind turbine, which also supplies energy to the local community. The Scheid Family Wines globally distributed brand portfolio includes Scheid Vineyards, Sunny with a Chance of Flowers, VDR (Very Dark Red), Grandeur (organically certified), Fog & Light, Metz Road, District 7, Ryder Estate, and HOXIE, a premium wine spritzer. Scheid Family Wines sells internationally to over 30 countries and is one of the largest producers of premium exclusive brands.  

Please visit www.scheidfamilywines.com and www.otcmarkets.com/stock/SVIN/quote for more information.

CONTACT:	Scott Scheid, President and CEO, scott.scheid@scheidfamilywines.com
	Mike Thomsen, Chief Financial Officer, mike.thomsen@scheidfamilywines.com

 

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SOURCE Scheid Family Wines

FAQ

What caused SVIN's revenue decline in Q3 2025?

SVIN's revenue decline was due to multiple factors: slower bottled wine market, decreased bulk wine sales, reduced grape sales, and the dissolution of a winery processing contract combined with a lighter 2024 harvest.

How much did SVIN's interest expenses increase in Q3 2025?

SVIN's interest expenses increased by 146% to $11.8 million from $4.8 million, due to default interest rates averaging 14.2% from lenders.

What was SVIN's harvest performance in 2024?

SVIN's 2024 grape harvest, completed on October 30, 2024, yielded approximately 15% below the company's five-year average, consistent with other California coastal vineyard regions.

What one-time gains did SVIN report in fiscal 2025?

SVIN reported two significant one-time gains: $3.6 million from early termination of a winery processing agreement and $1.7 million from the sale of non-vineyard land.

How much did SVIN's net loss increase in Q3 2025?

SVIN's net loss increased to $6.8 million for the nine months ended November 30, 2024, compared to a net loss of $1.8 million in the same period of 2023.