The Company has restated its condensed consolidated statements as of and for the three and nine months ended March 31, 2022.

During the audit for the fiscal year ending June 30, 2022, an accounting error was identified in the treatment of the Company's accounting for interest rate swap liabilities that materially impacted our condensed consolidated financial statements for the three and nine months ended March 31, 2022. The Company had erroneously accounted for these interest rate swaps as liabilities when the interest rate swaps should have been accounted for as assets. The error resulted in an overstatement of liabilities of $1.6 for the nine months ended March 31, 2022, an understatement of assets of $5.1 million for the three and nine months ended March 31, 2022 and an understatement in unrecognized gain on interest rate swap agreements of $6.7 million for the three and nine months ended March 31, 2022, net of income taxes.

The following tables present the impact of the adjustments described above to our previously reported condensed consolidated balance sheets for the nine months ended March 31, 2022, and the related condensed consolidated statements of operations, condensed consolidated statements of stockholders’ equity and condensed consolidated cash flows for the three and nine months ended March 31, 2022.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands, except share amounts)


	March 31, 2022
	As Previously Reported			Adjustments			As Restated
Assets
Current assets:
Cash	$	69,109					$	69,109
Restricted cash		6,600						6,600
Accounts receivable, net		39,649						39,649
Other receivables		13,668						13,668
Inventories		221,264						221,264
Interest rate swap assets		-			716			716
Prepaid expenses and other current assets		10,968						10,968
Total current assets		361,258			716			361,974
Property, plant, and equipment, net		234,141						234,141
Goodwill		158,185						158,185
Intangible assets, net		64,809						64,809
Interest rate swap assets, long-term		-			4,417			4,417
Other assets		7,635						7,635
Total assets	$	826,028		$	5,133			831,161
Liabilities, redeemable noncontrolling interest, and stockholders' equity								-
Current liabilities:								-
Line of credit	$	146,732						146,732
Accounts payable		14,777						14,777
Accrued liabilities and other payables		30,460			2,678			33,138
Interest rate swap liabilities		-			977			977
Current maturities of long-term debt		21,200						21,200
Total current liabilities		213,169			3,655			216,824
Other long-term liabilities		8,740						8,740
Long-term debt, less current maturities		172,324						172,324
Interest rate swap liabilities, noncurrent		5,225			(5,225	)		-
Deferred tax liability		29,965						29,965
Deferred gain		10,999						10,999
Total liabilities		440,422			(1,570	)		438,852
Commitments and contingencies (Note 13)								-
Redeemable noncontrolling interest		1,684						1,684
Stockholders' equity:								-
Preferred stock, no par value, 2,000,000 shares authorized, and none issued and outstanding at March 31, 2022 and June 30, 2021.		-						-
Common stock, no par value, 200,000,000 shares authorized, 61,691,054 issued and 61,377,515 outstanding at March 31, 2022 and 60,461,611 issued and outstanding at June 30, 2021.		-						-
Additional paid-in capital		373,196						373,196
Treasury stock, at cost: 313,539 and zero shares held at March 31, 2022 and June 30, 2021, respectively		(2,833	)					(2,833	)
Retained earnings		14,176			6,704			20,880
Total Vintage Wine Estates, Inc. stockholders' equity		384,539			6,704			391,243
Noncontrolling interests		(617	)		(1	)		(618	)
Total stockholders' equity		383,922			6,703			390,625
Total liabilities, redeemable noncontrolling interest, and stockholders' equity	$	826,028		$	5,133		$	831,161

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

(Unaudited)

(in thousands, except share and per share amounts)


	Three Months Ended March 31,									Nine Months Ended March 31,
	2022									2022
	As Previously Reported			Adjustments			As Restated			As Previously Reported			Adjustments			As Restated
Net revenues
Wine, spirits and cider	$	50,859					$	50,859		$	157,292					$	157,292
Nonwine		28,074						28,074			60,939						60,939
		78,933						78,933			218,231						218,231
Cost of revenues
Wine, spirits and cider		38,764						38,764			98,428						98,428
Nonwine		12,152						12,152			29,886						29,886
		50,916						50,916			128,314						128,314
Gross profit		28,017						28,017			89,917						89,917
Selling, general, and administrative expenses		27,035						27,035			70,662						70,662
Loss (gain) on sale of property, plant, and equipment		98						98			(493	)					(493	)
Gain on litigation proceeds		-						-			-						-
Income from operations		884						884			19,748						19,748
Other income (expense)
Interest expense		(3,729	)					(3,729	)		(10,825	)					(10,825	)
Net unrealized gain on interest rate swap agreements		4,553			9,288			13,841			8,582			9,288			17,870
Other, net		1,957						1,957			1,945						1,945
Total other income (expense), net		2,781			9,288			12,069			(298	)		9,288			8,990
Income before provision for income taxes		3,665			9,288			12,953			19,450			9,288			28,738
Income tax provision		958			2,585			3,543			5,412			2,585			7,997
Net income		2,707			6,703			9,410			14,038			6,703			20,741
Net income (loss) attributable to the noncontrolling interests		(73	)		(1	)		(74	)		(138	)		(1	)		(139	)
Net income attributable to Vintage Wine Estates, Inc.		2,780			6,704			9,484			14,176			6,704			20,880
Accretion on redeemable Series B stock		-						-			-						-
Net income (loss) allocable to common stockholders	$	2,780		$	6,704		$	9,484		$	14,176		$	6,704		$	20,880

Net earnings (loss) per share allocable to common stockholders
Basic	$	0.05		$	0.10		$	0.15		$	0.23		$	0.11		$	0.34
Diluted	$	0.05		$	0.10		$	0.15		$	0.23		$	0.11		$	0.34
Weighted average shares used in the calculation of earnings per share allocable to common stockholders
Basic		61,410,403						61,410,403			60,773,258						60,773,258
Diluted		61,410,403						61,410,403			60,773,258						60,773,258

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(in thousands, except share amounts)


	Redeemable Non-Controlling Interest Amount			Common Stock				Treasury Stock					Additional Paid-In Capital		Retained Earnings		Non-Controlling Interests			Total Stockholders' Equity
				Shares		Amount		Shares		Amount
Balance, June 30, 2021	$	1,682			60,461,611	$	-						$	360,732	$	-	$	(477	)	$	360,255
Net income (loss)		3			-		-							-		2,804		(28	)		2,776
Balance, September 30, 2021	$	1,685			60,461,611	$	-						$	360,732	$	2,804	$	(505	)	$	363,031
Net income (loss)		5			-		-							-		8,592		(45	)		8,547
Balance, December 31, 2021	$	1,690			60,461,611	$	-						$	360,732	$	11,396	$	(550	)	$	371,578
Stock-based compensation									-		-			1,943		-		-			1,943
Issuance of common stock in business combination					1,229,443		-		-		-			10,521		-		-			10,521
Repurchase of common stock					-		-		313,539		(2,833	)		-		-		-			(2,833	)
Net income (loss)		(6	)		-		-		-		-			-		2,780		(68	)		2,712
Adjustments																6,704					6,704
Balance, March 31, 2022, As Restated	$	1,684			61,691,054	$	-		313,539	$	(2,833	)	$	373,196	$	20,880	$	(618	)	$	390,625

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)


	Nine Months Ended March 31,
	2022
	As Previously Reported			Adjustments			As Restated
Cash flows from operating activities
Net income	$	14,038			6,703		$	20,741
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization		17,365						17,365
Amortization of deferred loan fees and line of credit fees		296						296
Amortization of label design fees		668						668
Litigation proceeds		-						-
Stock-based compensation expense		1,943						1,943
Provision for doubtful accounts		45						45
Impairment of inventory		-						-
Net unrealized gain on interest rate swap agreements		(8,582	)		(9,288	)		(17,870	)
(Benefit) provision for deferred income tax		888						888
Loss (gain) on disposition of assets		508						508
Deferred gain on sale leaseback		(1,000	)					(1,000	)
Deferred rent		285						285
Change in operating assets and liabilities (net of effect of business combinations):
Accounts receivable		(21,261	)					(21,261	)
Related party receivables		-						-
Other receivables		376						376
Litigation receivable		-						-
Inventories		4,244						4,244
Prepaid expenses and other current assets		(2,232	)					(2,232	)
Other assets		(6,215	)					(6,215	)
Accounts payable		(8,106	)					(8,106	)
Accrued liabilities and other payables		2,836			2,585			5,421
Related party liabilities		-						-
Net cash (used in) provided by operating activities		(3,903	)		-			(3,903	)


Cash flows from investing activities		-			-
Proceeds from disposition of assets		105			105
Purchases of property, plant, and equipment		(15,723	)		(15,723	)
Label design expenditures		(225	)		(225	)
Proceeds on related party notes receivable		-			-
Acquisition of businesses		(74,268	)		(74,268	)
Net cash used in investing activities		(90,111	)		(90,111	)
Cash flows from financing activities		-			-
Repurchase of common stock		(2,833	)		(2,833	)
Principal payments on line of credit		(67,210	)		(67,210	)
Proceeds from line of credit		126,591			126,591
Outstanding checks in excess of cash		2,900			2,900
Principal payments on long-term debt		(13,178	)		(13,178	)
Proceeds from long-term debt		-			-
Principal payments on related party note		-			-
Deferred offering costs		-			-
Payments on acquisition payable		(226	)		(226	)
Net cash provided by financing activities		46,044			46,044
Net change in cash and restricted cash		(47,970	)		(47,970	)
Cash and restricted cash, beginning of period		123,679			123,679
Cash and restricted cash, end of period	$	75,709		$	75,709
Supplemental cash flow information
Cash paid during the period for:
Interest	$	9,508		$	9,415
Income taxes	$	22		$	22
Noncash investing and financing activities:		-		$	-
Contingent consideration in a business combination	$	8,460		$	8,460
Issuance of common stock in business combination	$	10,521		$	10,521
Accretion of redemption value of Series B redeemable cumulative stock	$	-		$	-
Accretion of redemption value of Series A redeemable stock	$	-		$	-
Offering costs	$	-		$	-