Replies to post #9261 on Castle Brands Board (ROX)

[FUNMAN]

Some, Per your thoughts on the presentation's basic theme, I agree almost entirely with your statement:

Sure looks to me like they are setting up the case that they are fast growing, very much under-valued and presumably ready to sell the business. At least that's my interpretation, but I didn't compare it to earlier ones.

No doubt you are correct since with the lower PPS, they note the enterprise value as a multiple of revenue was 2.1 times.

The first bullet bullet point in "Public Comparables" on page 6 notes "for public drinks companies, the multiples of enterprise value to annual revenue are typically 5 - 6 times.

I'm just not sure if their end game is to bail out when they are so close to crossing the finish line. After years of unprofitability, to get out now seems short sighted unless they are giving up and believe Sales and Administrative expenses are simply too closely tied to revenue growth.

[Schweinemeister]

This says it, "A Large Spirit Company could decrease COGS increase FOBs, increase sales, and reduce selling expenses and G&A which would significantly increase EBITDA." Why yes ROX will tender all offers...the acquiring company would be buying the good and the lesser profitable product lines and a profitless company. This is NOT what an acquiring company wants! An acquiring company wants accretive earnings. ROX could sell piece meal, but I think they keep it together for an indeterminate time frame. Their risk boiler plate alludes to something akin to, "we may never be profitable", that scares investors and acquiring companies away.

Secondly if a company wanted to acquire ROX it is very rare that a paying company would pay more than 50% of the share price. At $1.20 $1.40 I would still be underwater...so I am not playing this company.

The last straw for me was the management gave themselves pay raises during a time of NO profit...not right. Also Jefferson's is rolling over in the growth trajectory for this quarter. I will have to wait and see on the next.

Jeffersons is a well to do drinkers Bourbon or an afficianado's Bourbon. I sells well in upper and upper middle class liqour stores, but not in the country. I like it but there are many products out there and Bourbon lovers I know are trying all different kinds, not just finding one and sticking to it. We are agreed Jeffersons is good to great!

I hope I am wrong, but I haven't seen anything to the contrary...I haven't seen much that tells me that ROX is serious about profiting.

I was patient and failed as an investor in ROX after a year and a half. I have a beautiful wife and I am married to her not this company stock... I will watch and maybe I'll buy back as a trade. I would have to see something compelling that we have actually hit a bottom.