Diamond Estates Wines & Spirits Reports Q2 2025 Financial Results

Niagara-on-the-Lake, Ontario--(Newsfile Corp. - November 28, 2024) - Diamond Estates Wines & Spirits Inc. (TSXV: DWS) ("Diamond Estates" or "the Company") today announced its financial results of position for the three and six months ended September 30, 2024 ("Q2 2025 and "YTD 2025" respectively).

Q2 2025 Summary:

• Revenue for Q2 2025 was $7.7 million, a decrease of $0.1 million from $7.8 million in Q2 2024. The Winery division experienced an increase in sales of $2.4 million while the Agency division experienced a decrease of $2.4 million. The increase in sales in the Winery division is largely attributable to $0.9 from DPTB, $0.5 million increase of all other brands and the remainder is from the VQA wine support program. The increase in sales is a direct result of the Ontario's government announcement to expand the marketplace to convenience, grocery and big-box stores. The decrease in the Agency division was primarily driven by the loss of a key supplier in the prior year in the amount of $2.1 million and the sale of Western Canada operations to Renaissance in August, 2024;

• Gross margin¹ as a percentage of revenue grew to 53.9% for Q2 2025 compared to 39.6% in Q2 2024 and gross margin increased $1.1 million, from $3.1 million in Q2 2024 to $4.2 million for Q2 2025. The Winery division experienced an increase of $1.5 million while the Agency declined by $0.4 million. The gross margin in the Winery division increased from 43.7% in Q2 2024 to 51.0% in Q2 2025 as a result of the VQA Wine support program and general margin increases across various skus. The gross margin at the Agency increased from 33.9% in Q2 2024 to 76.4% in Q2 2025 with the sale of Western Canada operations to Renaissance in August, 2024 and the increase in commissions sales compared to third party wines and spirits;

• EBITDA1 increased by $2.0 million to positive $1.0 million in Q2 2025 from a negative $1.0 million in Q2 2024. Adjusted EBITDA1 increased by $1.3 million to positive $0.5 million in Q2 2025 from a negative $0.8 million in Q2 2024. Both EBITDA and Adjusted EBITDA increases are attributed to improving gross margins in the Winery division and an overall decrease in SG&A expenses of $0.2 million compared to the prior year; and