Castle Brands reports double-digit sales increases for Q4, fiscal-year 2014
Jefferson’s whiskeys and Gosling’s Rum drove growth
Castle Brands Inc., New York, reported positive results for the fourth quarter and fiscal year ending March 31.
For the full fiscal year, net sales increased 16.2 percent to $48.1 million, compared with the prior year. This sales growth was driven by increased rum and whiskey sales in the United States and international markets, the company says.
In particular, Castle Brands’ Jefferson’s brand of bourbon, rye and Irish whiskeys led to a 43.5 percent increase in whiskey revenues compared with the prior year, it reports.
"The continued success of Jefferson's brings additional requirements for aged bourbon and finished goods inventory,” said John Glover, chief operating officer of Castle Brands, in a statement. “To provide long-term bourbon supplies, we purchased $5 million of aged bourbon. The company financed the bulk bourbon purchases through the placement of $2.1 million of 5 percent convertible notes (convertible into common at $0.90 per share), proceeds from the exercise of warrants and the issuance of [$4.3 million of] common stock through [an at-the-market] (ATM) offering. These funds also enabled us to support the growth of our other core brands, including our fast-growing Irish whiskeys.”
The company’s Gosling’s Rum also experienced a 14.2 percent increase in case sales to approximately 160,000, compared with the prior year, and its Gosling’s Stormy Ginger Beer increased 63 percent in case sales to approximately 429,000 cases, compared with the prior year, the company reports.
“It is encouraging to see this continued growth of Gosling's Stormy Ginger Beer, as it bodes well for the Dark 'n Stormy cocktail, an important driver of Gosling's sales," Glover added in a statement.
The company also reported positive earnings before interest, taxes, depreciation and amortization (EBITDA), as adjusted, for the first year ever. EBITDA rose $500,000 in fiscal-year 2014, compared with a loss of $700,000 in fiscal-year 2013.
In the fourth quarter of fiscal-year 2014, the company’s net sales increased 15.6 percent to $12.5 million, compared with the prior-year period. EBITDA, as adjusted, for the fourth quarter improved to a gain of $350,000, compared with a loss of $30,000 in the prior-year period.
"Our strong sales force and effective marketing programs continued to drive substantial growth of our core brands,” said Richard J. Lampen, president and chief executive officer of Castle Brands, in a statement. “This ability to scale our business has led to improved operating performance over the last five years. In fiscal 2014, we were able to continue that growth and show positive EBITDA, as adjusted, for the first year in the company's history. We view this as an important turning point and expect the trends of sales growth and cost containment to continue.”