Castle Brands Inc., a New York City-based developer and international marketer of premium and super-premium branded spirits, reported financial results for the three- and nine-month periods ending Dec. 31, 2013.
Net sales for the company increased 28 percent in the quarter to $13.6 million, compared with $10.6 million in the prior-year period. Loss from operations was $100,000 in the third quarter of fiscal year 2014, which marked an improvement of 75 percent from a loss of $400,000 in the prior-year period. The company also recorded positive quarterly earnings before interest, taxes, depreciation and amortization (EBITDA), as adjusted, with a gain of $200,000, compared with a loss of $100,000 last year.
For the nine months ended Dec. 31, 2013, Castle Brands reported net sales of $35.7 million, a 16.4 percent increase from $30.6 million in the prior-year period. Loss from operations was $800,000, an improvement of 55.2 percent from a loss of $1.7 million for the comparable fiscal year 2013 period. EBITDA, as adjusted, turned positive to a gain of $100,000, compared with a loss of $700,000 for the prior-year period.
"Our core brands, including Gosling's, Jefferson's and our Irish whiskeys, continue to show very strong growth, far above industry averages, said Richard J. Lampen, president and chief executive officer of Castle Brands, in a statement. “We expect this growth to continue, fostered by the work of our Strategic Planning Committee. As in prior periods, significant top-line growth, coupled with our ability to contain expenses, resulted in continued improvement in EBITDA, as adjusted. We expect these trends to continue as we work to build the value of our brands.”
Very strong growth for Jefferson’s bourbons and rye and the Irish whiskeys led to a 74.2 percent increase in whiskey revenues from the prior-year period. Gosling's Rum continued also its strong growth trend with revenues up 12.9 percent from the prior-year period. Similarly, Gosling's Stormy Ginger Beer case sales increased 79.4 percent to approximately 99,000 cases compared with approximately 55,000 cases in the prior-year period.
"The continued success of Jefferson's brings with it requirements for aged bulk bourbon, raw materials and finished goods inventory to meet growing demand,” said John Glover, chief operating officer, in a statement. “In October, the company placed over $2 million of 5 percent junior notes, which are convertible into common stock at $0.90 per share. We are using these funds, along with the proceeds from the recent warrant exercises, to expand our bourbon inventories and support the growth of our other core brands. It is also very encouraging to see the continued dramatic increase in sales of Gosling's Stormy Ginger Beer, as this bodes well for the Dark 'n Stormy cocktail, an important driver of Gosling's sales.”
