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
"When we talk about cloud without compromise what we're talking about is that when people think about 'I need the flexibility of the cloud' - it's the ability to create applications and run them in a cloud environment that's far more flexible,” explained Matthew Finnie, CTO of Interoute, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
No hype cycles or predictions of zillions of things here. IoT is big. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, Associate Partner at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He discussed the evaluation of communication standards and IoT messaging protocols, data analytics considerations, edge-to-cloud tec...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend 21st Cloud Expo October 31 - November 2, 2017, at the Santa Clara Convention Center, CA, and June 12-14, 2018, at the Javits Center in New York City, NY, and learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
SYS-CON Events announced today that MobiDev, a client-oriented software development company, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software company that develops and delivers turn-key mobile apps, websites, web services, and complex software systems for startups and enterprises. Since 2009 it has grown from a small group of passionate engineers and business...
What's the role of an IT self-service portal when you get to continuous delivery and Infrastructure as Code? This general session showed how to create the continuous delivery culture and eight accelerators for leading the change. Don Demcsak is a DevOps and Cloud Native Modernization Principal for Dell EMC based out of New Jersey. He is a former, long time, Microsoft Most Valuable Professional, specializing in building and architecting Application Delivery Pipelines for hybrid legacy, and cloud ...
The Internet giants are fully embracing AI. All the services they offer to their customers are aimed at drawing a map of the world with the data they get. The AIs from these companies are used to build disruptive approaches that cannot be used by established enterprises, which are threatened by these disruptions. However, most leaders underestimate the effect this will have on their businesses. In his session at 21st Cloud Expo, Rene Buest, Director Market Research & Technology Evangelism at Ar...
SYS-CON Events announced today that GrapeUp, the leading provider of rapid product development at the speed of business, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company, specialized in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market acr...
SYS-CON Events announced today that Ayehu will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on October 31 - November 2, 2017 at the Santa Clara Convention Center in Santa Clara California. Ayehu provides IT Process Automation & Orchestration solutions for IT and Security professionals to identify and resolve critical incidents and enable rapid containment, eradication, and recovery from cyber security breaches. Ayehu provides customers greater control over IT infras...
21st International Cloud Expo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Me...
DevOps at Cloud Expo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 21st Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to w...
We build IoT infrastructure products - when you have to integrate different devices, different systems and cloud you have to build an application to do that but we eliminate the need to build an application. Our products can integrate any device, any system, any cloud regardless of protocol," explained Peter Jung, Chief Product Officer at Pulzze Systems, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA
"Loom is applying artificial intelligence and machine learning into the entire log analysis process, from start to finish and at the end you will get a human touch,” explained Sabo Taylor Diab, Vice President, Marketing at Loom Systems, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend 21st Cloud Expo October 31 - November 2, 2017, at the Santa Clara Convention Center, CA, and June 12-14, 2018, at the Javits Center in New York City, NY, and learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
With the introduction of IoT and Smart Living in every aspect of our lives, one question has become relevant: What are the security implications? To answer this, first we have to look and explore the security models of the technologies that IoT is founded upon. In his session at @ThingsExpo, Nevi Kaja, a Research Engineer at Ford Motor Company, discussed some of the security challenges of the IoT infrastructure and related how these aspects impact Smart Living. The material was delivered interac...
Artificial intelligence, machine learning, neural networks. We’re in the midst of a wave of excitement around AI such as hasn’t been seen for a few decades. But those previous periods of inflated expectations led to troughs of disappointment. Will this time be different? Most likely. Applications of AI such as predictive analytics are already decreasing costs and improving reliability of industrial machinery. Furthermore, the funding and research going into AI now comes from a wide range of com...