SPLASH BEVERAGE GROUP, INC. Annual Report Summary

I’m putting together a plain-English guide to help you understand how Splash Beverage Group performed this year. My goal is to cut through the corporate speak and help you decide if this company is worth your attention.

1. What does this company do and how did they perform this year?

Splash Beverage Group acts as a "brand incubator" and distributor for niche drinks like SALT Tequila, Copa di Vino, and Pulpoloco Sangria. This year was a difficult period for the company. They hit a wall: a severe lack of cash meant they generated zero revenue from February 2025 through the end of the year. They have paused their previous distribution operations to focus entirely on acquiring the CBD brand Medterra.

2. Financial performance

The financial picture is challenging. The company lost about $24.8 million for the year ending December 31, 2025. Because they ran out of cash, they could not fund the inventory or marketing needed to run their business. They also canceled the purchase of Costa Rican water rights, leading to a $20 million "impairment charge," which removed the asset's value from their books. The company currently carries a $15.3 million deficit, meaning their debts exceed their assets.

3. Major wins and challenges

• The "Zero Revenue" Reality: The company stopped all operations in early 2025. They have plans to restart by selling "Chispo" tequila, but this remains a future goal. They currently lack the cash to manufacture or ship the product.
• The Medterra Pivot: To avoid going out of business, management agreed to buy Medterra, a CBD wellness brand. They are banking on Medterra’s sales to help them meet the NYSE American’s listing rules, which they currently fail to meet.

4. Financial health

This is a high-risk, distressed situation. The company violates NYSE American rules, which require at least $6 million in equity. They are relying entirely on the Medterra deal to fix their balance sheet. The deal requires them to take on or pay off Medterra’s $10.4 million debt. If they cannot raise the money to close this deal and pay these creditors, they face significant risks regarding their survival and their standing on the stock exchange.

5. Key risks

• Survival Risk: The company needs immediate capital to cover Medterra’s debt and basic operating costs. With no current revenue, they rely entirely on outside funding, which is difficult to secure given their recent losses.
• Stock Exchange Listing: The NYSE American has warned the company about its status. If they do not resolve this through the merger or by raising cash, the stock will move to the OTC markets. This transition typically reduces liquidity and investor interest.
• Dilution: To pay for the Medterra deal, the company plans to issue 54.4 million new shares. This will significantly increase the total number of shares, which reduces your ownership percentage and lowers the value of individual shares.

6. Future outlook

The company is betting its future on the Medterra acquisition, expected to close in May 2026. This is their primary path to move past their "going concern" status—a warning from auditors that the company might not survive the next year. If the deal closes, they aim to stabilize operations. If the deal fails, or if they cannot satisfy the $10.4 million debt, the company faces a high probability of bankruptcy.

Investor Takeaway: This is a speculative, high-risk situation. The company is currently non-operational and is attempting a "make-or-break" acquisition to avoid bankruptcy and delisting. Before considering an investment, weigh whether you believe the Medterra deal will successfully close and if the resulting business can generate enough cash to overcome the company's significant debt and equity deficit.