SALEM, Ore., March 26, 2024 /PRNewswire/ -- Willamette Valley Vineyards, Inc. (NASDAQ:WVVI) (the "Company"), a leading Oregon producer of Pinot Noir, generated a loss per common share after preferred dividends of $0.65 and $0.51 for the years ended December 31, 2023 and 2022, respectively, an increase of $0.14, or 29.2%, for the year ended December 31, 2023 over the prior year period. The primary reason for this increase was an increase in net loss and higher preferred stock dividends in 2023 compared to 2022.
The Company had net sales revenues of $39,136,114 and $33,934,081 for the years December 31, 2023 and 2022, respectively, an increase of $5,202,033, or 15.3%, for the year ended December 31, 2023 over the prior year period primarily as a result of an increase in revenue from direct sales of $4,786,730, or 30.4% in 2023 compared to 2022, and an increase in revenue from sales to distributors of $415,303 or 2.3% in 2023 compared to 2022.
Gross profit was $22,557,128 and $18,814,096 for the years ended December 31, 2023 and 2022, respectively, an increase of $3,743,032 or 19.9%, for the year ended December 31, 2023 over the prior year period. This increase was generally driven by an increase in sales revenues in 2023.
Selling, general and administrative expenses were $23,764,330 and $19,360,514 for the years ended December 31, 2023 and 2022, respectively, an increase of $4,403,816, or 22.7%, for the year ended December 31, 2023 over the prior year period. This increase was primarily as a result of more sales coming from tasting rooms which have higher selling costs and from newer locations being open for longer in 2023.
Loss from operations was $1,207,202 and $546,418 for the years ended December 31, 2023 and 2022, respectively, an increase of $660,784, for the year ended December 31, 2023 compared to the prior year period. This increase included higher depreciation costs of $1,232,459 in 2023 mostly relating to the investment in new locations.
Jim Bernau, Founder and CEO of the Company said "I believe that our gross profit increasing by approximately 20% in 2023 over 2022 relative to our sales growth of approximately 15% over that same period signals that the substantial inflationary pressure that previously impacted the Company's costs of growing, making and selling our wines has subsided. Cash from operations improved in 2023, while higher depreciation expenses from the deployment of new retail assets reduced the Company's net profits. In the event that the wine market changes and contracts, I believe that these new retails assets will aid the Company in ensuring that our brands remain compelling to wine consumers."
For a complete discussion of the Company's financial condition and operating results, see our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the United States Securities and Exchange Commission on EDGAR.
Willamette Valley Vineyards, Inc. is headquartered at its Estate Vineyard near Salem, Oregon. The Company's common stock is traded on NASDAQ (WVVI).
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, referred to as the "Securities Act", and Section 21E of the Securities Exchange Act of 1934, as amended, referred to as the "Exchange Act". These forward-looking statements involve risks and uncertainties that are based on current expectations, estimates and projections about the Company's business, and beliefs and assumptions made by management. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates", "predicts," "potential," "should," or "will" or the negative thereof and variations of such words and similar expressions are intended to identify such forward-looking statements. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including, but not limited to: availability of financing for growth, availability of adequate supply of high quality grapes, successful performance of internal operations, impact of competition, changes in wine broker or distributor relations or performance, impact of possible adverse weather conditions, impact of reduction in grape quality or supply due to disease or smoke from forest fires, changes in consumer spending, the reduction in consumer demand for premium wines, and the revenues or costs for any of our four new tasting rooms and restaurants exceeding our expectations. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic economic conditions.
Many of these risks as well as other risks that may have a material adverse impact on our operations and business, are identified in Item 1A "Risk Factors" in our Annual Report on Form 10-K.
The following is the Company's Statement of Operations for the year ended December 31, 2023 compared to the year ended December 31, 2022:
Year ended | |||||||
December 31, | |||||||
2023 | 2022 | ||||||
SALES, NET | $ 39,136,114 | $ 33,934,081 | |||||
COST OF SALES | 16,578,986 | 15,119,985 | |||||
GROSS PROFIT | 22,557,128 | 18,814,096 | |||||
OPERATING EXPENSES: | |||||||
Sales and marketing | 17,564,103 | 13,640,290 | |||||
General and administrative | 6,200,227 | 5,720,224 | |||||
Total operating expenses | 23,764,330 | 19,360,514 | |||||
LOSS FROM OPERATIONS | (1,207,202) | (546,418) | |||||
OTHER INCOME (EXPENSE) | |||||||
Interest income | 27 | 5,496 | |||||
Interest expense | (594,106) | (367,745) | |||||
Other income, net | 114,827 | 142,529 | |||||
LOSS BEFORE INCOME TAXES | (1,686,454) | (766,138) | |||||
INCOME TAX BENEFIT | 487,861 | 119,646 | |||||
NET LOSS | (1,198,593) | (646,492) | |||||
Preferred stock dividends | (2,047,097) | (1,866,451) | |||||
LOSS APPLICABLE TO COMMON SHAREHOLDERS | $ (3,245,690) | $ (2,512,943) | |||||
Loss per common share after preferred dividends, | |||||||
basic and diluted | $ (0.65) | $ (0.51) | |||||
Weighted-average number of | |||||||
common shares outstanding, basic and diluted | 4,964,529 | 4,964,529 | |||||
SOURCE Willamette Valley Vineyards
