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Castle Brands (ROX) Q3 Earnings Break Even, Revenues Miss

Zacks Equity Research

Premium branded spirits company Castle Brands Inc.’s ROX earnings broke even in the third quarter of fiscal 2017, in line with the Zacks Consensus Estimate. The company had posted a loss of a penny in the year-ago quarter.

Solid growth of the company’s more profitable brands, Jefferson's and Irish whiskeys, resulted in strong revenue growth and even higher gross profits.

The company’s quarterly revenues of $18.31 million missed the Zacks Consensus Estimate of $20.74 million by 11.7%. However, revenues reflected a 6.4% year-over-year rise on U.S. sales growth of Jefferson's bourbons, the Irish whiskies and Goslings Stormy Ginger Beer.

Whiskey revenues increased 14.5% from the year-ago quarter. Goslings Stormy Ginger Beer case sales increased 42.9% to approximately 339,000 cases.

Adjusted EBITDA of $1.6 million in the third quarter of fiscal 2017 reflected a rise of 132.1%.

Castle Brands, Inc. Price, Consensus and EPS Surprise

 

Castle Brands, Inc. Price, Consensus and EPS Surprise | Castle Brands, Inc. Quote

Other Updates

During the fiscal third quarter, Castle Brands’ additional purchases of 1000 barrels of aged bourbon reserves, coupled with the continuation of the long-term new fill programs have supported continued sales of its Jefferson's bourbon products.

The company entered into five-year exclusive distribution agreement for The Arran Malt Single Malt Scotch Whisky and Robert Burns Single Malt Whisky and Blended Scotch Whisky in the U.S.

Castle Brands intends to expand its wine finishes program as well as introduce new Jefferson's expressions over the remainder of fiscal 2017. The company has also boosted its Irish whiskey offerings and expanded the barrel program for Knappogue Castle Whiskey.

Financials

As of Dec 31, 2016 the company has cash and cash equivalents of $0.94 million compared with $1.43 million as of Mar 31, 2016.

Zacks Rank & Peer Release

Castle Brands has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here

Constellation Brands Inc.’s STZ adjusted earnings for the third quarter of fiscal 2017 jumped 38% year over year to $1.96 per share, outpacing the Zacks Consensus Estimate of $1.72.

Upcoming Peer Releases

Global brewer, Molson Coors Brewing Company’s TAP is slated to release its fourth-quarter numbers on Feb 14.

Boston Beer Co. Inc.’s SAM is expected to release its quarterly numbers on Feb 22.

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