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Castle Brands (ROX) Q2 Earnings Break Even, Revenues In Line

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Premium branded spirits company Castle Brands Inc.’s earnings broke even in the second quarter of fiscal 2018, in line with the Zacks Consensus Estimate as well as with the year-ago figure.

Revenues & EBITDA

The company’s quarterly revenues of $20.9 million were almost in line with the Zacks Consensus Estimate of $21 million. Revenues also improved 6.5% year over year. The upside was driven by solid improvement in the company’s U.S. sales growth of Jefferson's bourbons and Goslings Stormy Ginger Beer.

The company’s gross profit also improved 10.6% year over year to $8.5 million.

Adjusted EBITDA in the fiscal second quarter jumped 90% year over year to $1.9 million.

Castle Brands, Inc. Price, Consensus and EPS Surprise

 

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

First Half of Fiscal 2018 Highlights

The company’s sales in the period jumped 14.8% to $41.7 million. Whiskey revenues grew 21% buoyed by solid contribution from Jefferson's bourbons and Irish whiskies and the addition of the Arran scotch whiskey portfolio.

Goslings Stormy Ginger Beer case sales increased 37.2% year over year to approximately 907,000 cases in the period.

Other Updates

In October, Castle Brands acquired an additional 5% stake in Copperhead Distillery Company, the owner of the Kentucky Artisan Distillery. With this, Castle Brands has increased its stake in Copperhead Distillery Company to 25%. The move follows the completion of an initial 20% purchase in 2015.

The combination of its new fill whiskey program, coupled with opportunistic buyouts of aged whiskies, enables it to create substantial reserves of aged bourbon to support strong demand of its Jefferson's brand.

Stock Price Movement

Shares of Castle Brands have gained 53.9% on a year-to-date basis, outperforming 20.3% growth of the industry. Earnings estimates have remained stable in the last 30 days.




Zacks Rank & Key Picks

Castle Brands has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A few better-ranked stocks in the industry are The Boston Beer Company, Inc. (SAM - Free Report) , Constellation Brands Inc. (STZ - Free Report) and Brown Forman Corporation (BF.B - Free Report) .

Boston Beer, a Zacks Rank #1 stock, has a solid earnings surprise history, beating the consensus mark in each of the four trailing quarters, with an average of 63.35%. Its current-year earnings estimates have moved 9.2% up in the last 30 days.

Constellation Brands, a Zacks Rank # 2 (Buy) company, has an expected earnings growth rate of 24.7% for the current year.

Brown Forman, also a Zacks Rank #2 stock, is expected to witness 11.3% growth in earnings this year.

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