Welcome!

News Feed Item

Castle Brands Announces Fiscal 2015 First Quarter Results

Net Sales Increase 15.0% Driven by Strong Growth of Whiskeys and Gosling's Stormy Ginger Beer

NEW YORK, Aug. 14, 2014 /PRNewswire/ -- Castle Brands Inc. (NYSE MKT: ROX), a developer and international marketer of premium and super-premium branded spirits, today reported financial results for the quarter ended June 30, 2014.

Operating highlights for the quarter ended June 30, 2014:

  • Net sales increased 15% to $12.0 million as compared to $10.4 million for the comparable prior-year period.
  • Continued strong growth of Jefferson's bourbons and Irish whiskeys led to a 31% increase in whiskey revenues from the comparable prior-year period.
  • Gosling's Stormy Ginger Beer case sales increased 56% to approximately 162,000 cases from approximately 104,000 in the comparable prior-year period.
  • EBITDA, as adjusted, improved to a loss of ($53,000), compared to a loss of ($160,000) in the comparable prior-year period.
  • Purchased $4.2 million of aged bourbon to support the continued growth of Jefferson's brand in April 2014.

"Our core brands continue to show very strong growth. We are pleased with sales for the first quarter of fiscal 2015, particularly since it is typically our slowest period. Organic growth drove the increased revenues resulting in our improved EBITDA, as adjusted. We expect these growth trends and improving financial performance to continue," stated Richard J. Lampen, President and Chief Executive Officer of Castle Brands.     

"We also simplified our capital structure in the first quarter when all of our outstanding warrants issued in connection with our preferred stock were exercised. The warrant exercises and proceeds from our at-the-market offering generated $1.8 million of new equity capital," Mr. Lampen added.

"In the first quarter, we purchased $4.2 million of aged bourbon and secured additional rye inventory. These increases to our whiskey reserves will support continued rapid growth of the Jefferson's bourbon brand, including Jefferson's Reserve, our Jefferson's barrel program, Jefferson's Ocean Aged at Sea and Jefferson's Chef's Collaboration. Just as we continue to expand the Jefferson's umbrella, we plan to add additional offerings under our Knappogue and Clontarf Irish whiskey labels. This should provide additional growth opportunities for our whiskey sales," said John Glover, Chief Operating Officer of Castle Brands.

"Sales of Gosling's Stormy Ginger Beer increased 56% to 162,000 cases in the first quarter of fiscal 2015, a strong indication of the success of the Dark 'n Stormy® cocktail, an important driver of Gosling's rum sales. Trailing twelve month sales of Stormy Ginger Beer approached 500,000 cases, which equates to 12 million cans each prominently displaying the Gosling's logo. These ginger beer sales are very important as we continue to build Gosling's visibility and prominence as a brand," Mr. Glover added.

In the first quarter of fiscal 2015, the Company had net sales of $12.0 million, a 15.0% increase from net sales of $10.4 million in the comparable prior-year period. Loss from operations was ($0.5) million in the first quarter of both fiscal 2015 and 2014. Net loss attributable to common shareholders was ($1.5) million, or $(0.01) per basic and diluted share, in the each of the first quarters of fiscal 2015 and 2014.

EBITDA, as adjusted, for the first quarter of fiscal 2015 improved to a loss of ($53,000), compared to a loss of ($160,000) for the prior-year period.

Non-GAAP Financial Measures

Within the information above, Castle Brands provides information regarding EBITDA, as adjusted, which is not a recognized term under GAAP (Generally Accepted Accounting Principles) and does not purport to be an alternative to operating income (loss) or net income (loss) as a measure of operating performance. Earnings before interest, taxes, depreciation and amortization, or EBITDA, adjusted for allowances for doubtful accounts and obsolete inventory, other income, net, non-cash compensation expense, loss from equity investment in non-consolidated affiliate, foreign exchange, net change in fair value of warrant liability, net income attributable to noncontrolling interests and dividend to preferred shareholders  is a key metric the Company uses in evaluating its financial performance on a consistent basis across various periods. EBITDA is considered a non-GAAP financial measure as defined by Regulation G promulgated by the SEC under the Securities Act of 1933, as amended. Due to the significance of non-cash and non-recurring items, EBITDA, as adjusted, enables the Company's Board of Directors and management to monitor and evaluate the business on a consistent basis. The Company uses EBITDA, as adjusted, as a primary measure, among others, to analyze and evaluate financial and strategic planning decisions regarding future allocation of capital resources. The Company believes that EBITDA, as adjusted, eliminates items that are not indicative of its core operating performance or are based on management's estimates, such as allowances for doubtful accounts and obsolete inventory, are due to changes in valuation, such as the effects of changes in foreign exchange or fair value of warrant liability, or do not involve a cash outlay, such as stock-based compensation expense. EBITDA, as adjusted, should be considered in addition to, rather than as a substitute for, income from operations, net income and cash flows from operating activities. Reconciliation of net loss to EBITDA, as adjusted, is presented below.

About Castle Brands

Castle Brands is a developer and international marketer of premium beverage alcohol brands including: Gosling's Rum®, Jefferson's®, Jefferson's Presidential Select and Jefferson's Reserve® Bourbon, Jefferson's® Rye Whiskey, Knappogue Castle Whiskey®, Clontarf® Irish Whiskey, Pallini® Limoncello, Boru® Vodka and Brady's® Irish Cream, Celtic Honey® Liqueur and Castello Mio® Sambuca. Additional information concerning the Company is available on the Company's website, www.castlebrandsinc.com.

Forward Looking Statements

This press release includes statements of our expectations, intentions, plans and beliefs that constitute "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are intended to come within the safe harbor protection provided by those sections. These statements, which involve risks and uncertainties, related to the discussion of our business strategies and our expectations concerning future operations, margins, sales, new products and brands, potential joint ventures, potential acquisitions, expenses, profitability, liquidity and capital resources and to analyses and other information that are based on forecasts of future results and estimates of amounts not yet determinable. You can identify these and other forward-looking statements by the use of such words as "may," "will," "should," "expects," "intends," "plans," "anticipates," "believes," "thinks," "estimates," "seeks," "expects," "predicts," "could," "projects," "potential" and other similar terms and phrases, including references to assumptions. These forward looking statements are made based on expectations and beliefs concerning future events affecting us and are subject to uncertainties, risks and factors relating to our operations and business environments, all of which are difficult to predict and many of which are beyond our control, that could cause our actual results to differ materially from those matters expressed or implied by these forward looking statements. These risks include our history of losses and expectation of further losses, our ability to expand our operations in both new and existing markets, our ability to develop or acquire new brands, our relationships with distributors, the success of our marketing activities, the effect of competition in our industry and economic and political conditions generally, including the current economic environment and markets. More information about these and other factors are described under the caption "Risk Factors" in Castle Brands' Annual Report on Form 10-K for the year ended March 31, 2014 and other reports we file with the Securities and Exchange Commission. When considering these forward looking statements, you should keep in mind the cautionary statements in this press release and the reports we file with the Securities and Exchange Commission. New risks and uncertainties arise from time to time, and we cannot predict those events or how they may affect us. We assume no obligation to update any forward looking statements after the date of this press release as a result of new information, future events or developments, except as required by the federal securities laws.

CASTLE BRANDS INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(Unaudited)




Three months ended June 30,




2014



2013


Sales, net*


$

11,982,199



$

10,418,617


Cost of sales*



7,435,545




6,500,153











Gross profit



4,546,654




3,918,464











Selling expense



3,239,326




2,895,383


General and administrative expense



1,610,616




1,265,605


Depreciation and amortization



216,098




213,124











Loss from operations



(519,386)




(455,648)











Other income, net



16,942




--


Loss from equity investment in non-consolidated affiliate



--




(6,121)


Foreign exchange (loss) gain



(236,447)




60,340


Interest expense, net



(288,642)




(228,819)


Net change in fair value of warrant liability



--




(447,251)


Income tax (expense) benefit, net



(162,962)




37,038











Net loss



(1,190,495)




(1,040,461)


Net income attributable to noncontrolling interests



(305,336)




(252,372)











Net loss attributable to controlling interests



(1,495,831)




(1,292,833)











Dividend to preferred shareholders



--




(189,932)











Net loss attributable to common shareholders


$

(1,495,831)



$

(1,482,765)











Net loss per common share, basic and diluted, attributable to common shareholders


$

(0.01)



$

(0.01)











Weighted average shares used in computation, basic and diluted, attributable to common shareholders



153,929,182




109,424,026



* Sales, net and Cost of sales include excise taxes of $1,485,515 and $1,424,220 for the three months ended June 30, 2014 and 2013, respectively.

 

 

CASTLE BRANDS INC. AND SUBSIDIARIES

Reconciliation of Net Loss to EBITDA, as adjusted

(Unaudited)




Three months ended
June 30,




2014



2013


Net loss attributable to common shareholders


$

(1,495,831)



$

(1,482,765)


Adjustments:









Interest expense, net



288,642




228,819


Income tax expense (benefit), net



162,962




(37,038)


Depreciation and amortization



216,098




213,124


EBITDA (loss)



(828,129)




(1,077,860)


Allowance for doubtful accounts



59,000




10,500


Stock-based compensation expense



191,456




72,533


Other income, net



(16,942)




--


Loss from equity investment in non-consolidated affiliate



--




6,121


Foreign exchange loss (gain)



236,447




(60,340)


Net change in fair value of warrant liability



--




447,251


Net income attributable to noncontrolling interests



305,336




252,372


Dividend to preferred shareholders



--




189,932


EBITDA, as adjusted



(52,832)




(159,491)


 

 

Castle Brands Inc.
Investor Relations, 646-356-0200
[email protected]
www.castlebrandsinc.com

SOURCE Castle Brands Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lead...
SYS-CON Events announced today that CAST Software will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. CAST was founded more than 25 years ago to make the invisible visible. Built around the idea that even the best analytics on the market still leave blind spots for technical teams looking to deliver better software and prevent outages, CAST provides the software intelligence that matter ...
SYS-CON Events announced today that Daiya Industry will exhibit at the Japanese Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Ruby Development Inc. builds new services in short period of time and provides a continuous support of those services based on Ruby on Rails. For more information, please visit https://github.com/RubyDevInc.
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busine...
Is advanced scheduling in Kubernetes achievable? Yes, however, how do you properly accommodate every real-life scenario that a Kubernetes user might encounter? How do you leverage advanced scheduling techniques to shape and describe each scenario in easy-to-use rules and configurations? In his session at @DevOpsSummit at 21st Cloud Expo, Oleg Chunikhin, CTO at Kublr, will answer these questions and demonstrate techniques for implementing advanced scheduling. For example, using spot instances ...
As businesses evolve, they need technology that is simple to help them succeed today and flexible enough to help them build for tomorrow. Chrome is fit for the workplace of the future — providing a secure, consistent user experience across a range of devices that can be used anywhere. In her session at 21st Cloud Expo, Vidya Nagarajan, a Senior Product Manager at Google, will take a look at various options as to how ChromeOS can be leveraged to interact with people on the devices, and formats th...
First generation hyperconverged solutions have taken the data center by storm, rapidly proliferating in pockets everywhere to provide further consolidation of floor space and workloads. These first generation solutions are not without challenges, however. In his session at 21st Cloud Expo, Wes Talbert, a Principal Architect and results-driven enterprise sales leader at NetApp, will discuss how the HCI solution of tomorrow will integrate with the public cloud to deliver a quality hybrid cloud e...
SYS-CON Events announced today that Yuasa System will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Yuasa System is introducing a multi-purpose endurance testing system for flexible displays, OLED devices, flexible substrates, flat cables, and films in smartphones, wearables, automobiles, and healthcare.
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.
The session is centered around the tracing of systems on cloud using technologies like ebpf. The goal is to talk about what this technology is all about and what purpose it serves. In his session at 21st Cloud Expo, Shashank Jain, Development Architect at SAP, will touch upon concepts of observability in the cloud and also some of the challenges we have. Generally most cloud-based monitoring tools capture details at a very granular level. To troubleshoot problems this might not be good enough.
DevOps is under attack because developers don’t want to mess with infrastructure. They will happily own their code into production, but want to use platforms instead of raw automation. That’s changing the landscape that we understand as DevOps with both architecture concepts (CloudNative) and process redefinition (SRE). Rob Hirschfeld’s recent work in Kubernetes operations has led to the conclusion that containers and related platforms have changed the way we should be thinking about DevOps and...
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busine...
SYS-CON Events announced today that Dasher Technologies will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Dasher Technologies, Inc. ® is a premier IT solution provider that delivers expert technical resources along with trusted account executives to architect and deliver complete IT solutions and services to help our clients execute their goals, plans and objectives. Since 1999, we'v...
Enterprises have taken advantage of IoT to achieve important revenue and cost advantages. What is less apparent is how incumbent enterprises operating at scale have, following success with IoT, built analytic, operations management and software development capabilities – ranging from autonomous vehicles to manageable robotics installations. They have embraced these capabilities as if they were Silicon Valley startups. As a result, many firms employ new business models that place enormous impor...
We all know that end users experience the Internet primarily with mobile devices. From an app development perspective, we know that successfully responding to the needs of mobile customers depends on rapid DevOps – failing fast, in short, until the right solution evolves in your customers' relationship to your business. Whether you’re decomposing an SOA monolith, or developing a new application cloud natively, it’s not a question of using microservices – not doing so will be a path to eventual b...