**EXHIBIT 20.1**

 

 

222 Lakeview Avenue, Suite 1500, West Palm Beach, FL 33401

 

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*NEWS RELEASE*

 

**CRUZANINTERNATIONAL, INC. ANNOUNCES FINANCIAL RESULTS**

**FOR FIRSTQUARTER ENDED DECEMBER 31, 2005**

 

WEST PALM BEACH, FLORIDA – February 13, 2006 – Cruzan International, Inc.(AMEX: RUM), producer and distributor of the Cruzan line of rums from theVirgin Islands and a leading distiller of rum and brandy, and importer andmarketer of premium branded spirits, today reported financial results for itsfirst quarter ended December 31, 2005.

 

Net sales for fiscal 2006’s first quarter were $28,446,504, comparedwith $24,192,193 reported for fiscal 2005’s first quarter.  Gross profit was $6,700,306, compared to$8,074,992 in the same period last year, and first quarter net loss was$3,162,442, or $0.47 per diluted share, compared with net income of $149,090 or$0.02 per diluted share, one year ago.

 

Commenting on the results, Jay S. Maltby, Chief Executive Officer andPresident said, “In 2005 we had a change in majority ownership and are in theprocess of a merger transaction with affiliates of V&S Vin & SpritAB (publ), the owners of Absolut Vodka.”

 

Mr. Maltby continued, “Sales of Cruzan Rum in our premium brandedspirits segment were up only 1.9% due to one competitive supplier’s aggressivewholesaler incentive program during the quarter and a reduction of ourinventories at the wholesaler level.  Thepremium branded spirits segment sustained larger operating losses than lastyear due to increased marketing spending. Operating income in our bulk alcohol segment declined approximately $1.8million due to increased citrus alcohol raw material costs as a result of theeffects of hurricanes on the Florida citrus crop in 2004 and 2005.  The performance in our bottling segmentimproved due to the acquisition of a large new bottling contract and profits inour vinegar and cooking wine segment decreased slightly as a result ofdecreased sales.”

 

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Cruzan International, Inc. is a major supplier of rum, brandy andwine to the beverage alcohol industry. The Company also produces ultra-premium single-barrel aged rums andtropical rums, vinegar and other alcohol-related products.

 

Statements contained in this press release, other than historicalfacts, are “forward-looking statements” within the meaning of Section 27Aof the Securities Act of 1933 and Section 21E of the Securities andExchange Act of 1934.  Cruzan intendsthat such forward-looking statements shall be subject to the safe harborscreated thereby.  These statements involvevarious risks and uncertainties, including without limitation those containedin the section entitled “Risks that May Affect Future Results” inItem 7, “Management’s Discussion and Analysis of Financial Condition andResults of Operations” in Cruzan’s Annual Report on Form 10-K for thefiscal year ended September 30, 2005. As a result, future results may differ materially from the expectedresults represented by the forward looking-statements contained in this pressrelease.

 

Contact:       Ezra Shashoua, Executive Vice President &Chief Financial Officer

William Viggiano, Vice President &Controller

561-655-8977

 

—***FinancialResults Follow—***

 

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CRUZANINTERNATIONAL, INC.

Statements ofOperations

 
| **Periods ended**                         | ** ** | **Three Months** | ** ** | **Statement of Operations  as a % of  Net Sales** | ** ** |
|-------------------------------------------|------------|------------------|------------|---------------------------------------------------|------------|
| **December 31,**                     | ** ** | **2005**         | ** ** | **2004**                                          | ** ** | **2005** | ** ** | **2004** | ** ** |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Net sales                                 |       | $                | 28,446,504 |                                              | $          | 24,192,193 |   | 100.0 | % | 100.0 | % |
| Cost of  sales                            |       | 21,746,198       |       | 16,117,201                                        |       | 76.4 | % | 66.6 | % |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Gross profit                              |       | 6,700,306        |       | 8,074,992                                         |       | 23.6 | % | 33.4 | % |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Selling,  general and administrative      |       | 10,281,002       |       | 8,306,010                                         |       | 36.1 | % | 34.3 | % |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Operating  loss                           |       | (3,580,696       | )          | (231,018                                          | )          | -12.6 | % | -1.0 | % |
| Interest  expense                         |       | (853,728         | )          | (592,668                                          | )          | -3.0 | % | -2.4 | % |
| Other  income, net                        |       | 118,680          |       | 209,417                                           |       | 0.4 | % | 0.9 | % |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Loss before  income taxes                 |       | (4,315,744       | )          | (614,269                                          | )          | -15.2 | % | -2.5 | % |
| Income tax  benefit                       |       | 1,153,302        |       | 763,359                                           |       | 4.1 | % | 3.2 | % |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Net Income  (loss)                        |       | $                | (3,162,442 | )                                                 | $          | 149,090 |   | -11.1 | % | 0.6 | % |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Earnings  (loss) per common share:        |       |             |       |                                              |       |   |   |   |   |
| Basic                                     |       | $                | (0.47      | )                                                 | $          | 0.02 |   |   |   |   |   |
| Diluted                                   |       | $                | (0.47      | )                                                 | $          | 0.02 |   |   |   |   |   |
|                                      |       |             |       |                                              |       |   |   |   |   |
| Common shares and equivalents outstanding |       |             |       |                                              |       |   |   |   |   |
| Basic                                     |       | 6,748,717        |       | 6,338,519                                         |       |   |   |   |   |
| Diluted                                   |       | 6,748,717        |       | 6,458,198                                         |       |   |   |   |   |
| Shares outstanding at   end of period     |       | 6,748,056        |       | 6,338,519                                         |       |   |   |   |   |

 

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CRUZANINTERNATIONAL, INC.

CondensedConsolidated Balance Sheets

 
| ** **                                      | ** ** | ** **             | ** **  | ** **              | ** ** | **Balance Sheet  as a % of  Total Assets** | ** ** |
|-------------------------------------------------|------------|------------------------|-------------|-------------------------|------------|--------------------------------------------|------------|
| ** **                                      | ** ** | **December 31,  2005** | ** **  | **September 30,  2005** | ** ** | **December 31,  2005**                     | ** ** | **September 30,  2005** | ** ** |
| ASSETS                                          |       |                   |        |                    |       |                                       |       |   |   |
| CURRENT  ASSETS                                 |       |                   |        |                    |       |                                       |       |   |   |
| Cash and short-term investments                 |       | $                      | 5,031,175   |                    | $          | 3,785,276                                  |       | 3.7 | % | 2.8 | % |
| Receivables                                     |       | 23,993,162             |        | 25,616,285              |       | 17.8                                       | %          | 19.2 | % |
| Inventories                                     |       | 32,659,122             |        | 31,282,808              |       | 24.3                                       | %          | 23.4 | % |
| Other current assets                            |       | 5,149,746              |        | 4,885,161               |       | 3.8                                        | %          | 3.7 | % |
| Total current assets                            |       | 66,833,205             |        | 65,569,530              |       | 49.6                                       | %          | 49.0 | % |
|                                            |       |                   |        |                    |       |                                       |       |   |   |
| PROPERTY AND  EQUIPMENT, net                    |       | 37,054,628             |        | 38,283,133              |       | 27.5                                       | %          | 28.6 | % |
| OTHER ASSETS                                    |       | 30,734,222             |        | 29,896,465              |       | 22.8                                       | %          | 22.4 | % |
| Total assets                                    |       | $                      | 134,622,055 |                    | $          | 133,749,128                                |       | 100.00 | % | 100.0 | % |
|                                            |       |                   |        |                    |       |                                       |       |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY       |       |                   |        |                    |       |                                       |       |   |   |
| CURRENT  LIABILITIES                            |       |                   |        |                    |       |                                       |       |   |   |
| Current maturities of long-term debt            |       | $                      | 38,000,000  |                    | —     |                                       | 28.20      | % | — |   |
| Accounts payable                                |       | 9,081,715              |        | 12,946,544              |       | 6.7                                        | %          | 9.7 | % |
| Other accrued expenses                          |       | 5,350,847              |        | 7,217,927               |       | 4.0                                        | %          | 5.4 | % |
| Total current liabilities                       |       | 52,432,562             |        | 20,164,471              |       | 38.9                                       | %          | 15.1 | % |
|                                            |       |                   |        |                    |       |                                       |       |   |   |
| LONG-TERM  DEBT, less current maturities        |       | —                 |        | 28,600,000              |       | —                                     |       | 21.4 | % |
|                                            |       |                   |        |                    |       |                                       |       |   |   |
| DEFERRED  INCOME TAXES                          |       | —                 |        | —                  |       | —                                     |       | — |   |
|                                            |       |                   |        |                    |       |                                       |       |   |   |
| OTHER  LIABILITIES                              |       | 1,577,026              |        | 1,332,379               |       | 1.2                                        | %          | 1.0 | % |
|                                            |       |                   |        |                    |       |                                       |       |   |   |
| STOCKHOLDERS’  EQUITY                      |       | 80,612,467             |        | 83,652,278              |       | 59.9                                       | %          | 62.5 | % |
| Total liabilities and stockholders’ equity |       | $                      | 134,622,055 |                    | $          | 133,749,128                                |       | 100.0 | % | 100.0 | % |

 

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