Equity Investment |
3 Months Ended |
|---|---|
Jun. 30, 2018 | |
| Investments, Debt and Equity Securities [Abstract] | |
| Equity Investment |
NOTE 4 — EQUITY INVESTMENT
Investment in Gosling-Castle Partners Inc., consolidated
In March 2017, the Company acquired an additional 201,000 shares (the “GCP Share Acquisition”) of the common stock of GCP, representing a 20.1% equity interest in GCP. GCP is a strategic global export venture between the Company and the Gosling family. As a result of the completion of the GCP Share Acquisition, the Company’s total equity interest in GCP increased to 80.1%. The consideration for the GCP Share Acquisition was (i) $20,000,000 in cash and (ii) 1,800,000 shares of common stock of the Company. The Company accounted for this transaction in accordance with ASC 810 “Consolidation,” and in particular section 810-10-45.
For the three months ended June 30, 2018 and 2017, GCP had pretax net income on a stand-alone basis of $2,526,084 and $426,007, respectively. The Company allocated a portion of this net income, or $502,691 and $84,775, to non-controlling interest for the three months ended June 30, 2018 and 2017, respectively. The cumulative balance allocated to noncontrolling interests in GCP was $3,951,977 and $3,568,636 at June 30 and March 31, 2018, respectively, as shown on the accompanying condensed consolidated balance sheets.
Investment in Copperhead Distillery Company, equity method
In June 2015, CB-USA purchased 20% of Copperhead Distillery Company (“Copperhead”) for $500,000. Copperhead owns and operates the Kentucky Artisan Distillery. The investment was part of an agreement to build a new warehouse in Crestwood, Kentucky to store Jefferson’s bourbons, provide distilling capabilities using special mash-bills made from locally grown grains and create a visitor center and store to enhance the consumer experience for the Jefferson’s brand. In September 2017, CB-USA purchased an additional 5% of Copperhead for $156,000 from an existing shareholder. The Company has accounted for this investment under the equity method of accounting. For the three months ended June 30, 2018 and 2017, the Company recognized $34,028 and $41,749 of income from this investment, respectively. The investment balance was $847,954 and $813,926 at June 30 and March 31, 2018, respectively. |