Brick Brewing Reports First Quarter F2016 EBITDA of $0.9M

KITCHENER, ON--(Marketwired - June 04, 2015) -

• Net revenue increased to $7.7 million, from $7.5 million in the prior year

• Gross margin improved to 27.1% from 21.7%

• Selling, Marketing and Administration ("SM&A") expenses increased nominally to $1.8 million from $1.7 million

• EBITDA improved to $0.9 million in the quarter, vs. $0.7 million

Brick Brewing Co. Limited ("Brick" or the "Company") (BRB.TO), the largest Canadian-owned brewery in Ontario, today released financial results for the first quarter ended April 26, 2015. Brick reported first quarter EBITDA of $0.9 million on net revenue of $7.7 million.

"Our owner brand volume was flat in the first quarter, against a backdrop of approximately 2% volume decline for the overall category," noted Brick President and Chief Executive Officer George Croft. "Despite the impact of a long cold winter, Waterloo volume growth vs prior year was over 11% while Laker volume grew over 3%, both strong results in light of the category headwinds. Seagram volume was down approximately 27%, the result of fewer brand listings at LCBO and timing of new product launches set for Q2 in F16 vs Q1 in the prior year. We have recently launched attractive new flavors in Seagram malt based coolers, and as we move into summer we are looking for improved performance in Seagram coolers and cider."

Sound cost control, improved product mix and pricing all contributed to improvement in margins and EBITDA in the quarter. Croft added, "The business is performing very well, and we are seeing great execution against our plan. As we head into the key summer months, we believe we are well positioned for continued strong results. Our new product introductions are resonating with consumers, Kitchener expansion is on track, and the coming changes to the beer channel in Ontario, including the introduction of beer into grocery, all seem to be clear positives for Brick Brewing."

The following financial information should be read in conjunction with the audited annual financial statements of the Company prepared under IFRS for the year ended January 31, 2015.

Reconciliation of Net Earnings to Earnings Before Interest Taxes Depreciation and Amortization, and Share Based Payments (EBITDA)*

			Quarter ended
(in thousands of dollars)			April 26, 2015		April 27, 2014
Net income		$	31	$	(207	)
Add (deduct):
	Income tax expense (recovery)		18		(76	)
	Depreciation and amortization		683		765
	Loss on disposal of property, plant and equipment		-		7
	Share-based payments		30		49
	Finance costs		112		120
Subtotal			843		865
EBITDA*			874		658

STATEMENTS OF COMPREHENSIVE INCOME
For the quarters ended April 26, 2015 and April 27, 2014
(Not audited or reviewed by the Company's external auditor)
			Quarter ended
			April 26, 2015			April 27, 2014
Revenue		$	7,706,933		$	7,537,407
Cost of sales			5,615,177			5,897,603
Gross profit			2,091,756			1,639,804
Selling, marketing and administration expenses			1,774,445			1,698,461
Other expenses			157,121			96,789
Finance costs			111,602			120,443
Loss on disposal of property, plant and equipment			-			7,345
Income (loss) before tax			48,588			(283,234	)
Income tax expense (recovery)			17,810			(76,445	)
Net income (loss) and comprehensive income (loss) for the period		$	30,778		$	(206,789	)
Basic earnings (loss) per share		$	-		$	(0.01	)
Diluted earnings (loss) per share		$	-		$	(0.01	)

STATEMENTS OF FINANCIAL POSITION
As at April 26, 2015 and January 31, 2015
(Not audited or reviewed by the Company's external auditor)
					April 26, 2015				January 31, 2015
ASSETS
	Non-current assets
		Property, plant and equipment		$	17,896,184			$	15,582,051
		Intangible assets			15,386,974				15,114,247
		Deferred income tax assets			1,903,351				1,921,161
		Construction deposit			2,098,403				1,478,220
					37,284,912				34,095,679
	Current assets
		Cash			368,172				594,976
		Accounts receivable			6,128,661				6,492,461
		Inventories			4,844,629				3,400,821
		Prepaid expenses			489,236				350,154
					11,830,698				10,838,412
TOTAL ASSETS					49,115,610			$	44,934,091
LIABILITIES AND EQUITY
	Equity
		Share capital			39,400,380				39,413,636
		Share-based payments reserves			1,105,080				1,075,554
		Deficit			(6,076,697	)			(6,107,475	)
TOTAL EQUITY					34,428,763				34,381,715
	Non-current liabilities
		Provisions			311,773				307,235
		Obligation under finance lease			3,495,553				1,266,996
		Long-term debt			2,389,312				2,642,676
					6,196,638				4,216,907
	Current liabilities
		Accounts payable and accrued liabilities			6,578,547				4,665,784
		Current portion of obligation under finance lease			257,424				46,925
		Current portion of long-term debt			1,654,238				1,622,760
					8,490,209				6,335,469
TOTAL LIABILITIES					14,686,847				10,552,376
COMMITMENTS
TOTAL LIABILITIES AND EQUITY				$	49,115,610			$	44,934,091

STATEMENTS OF CASH FLOWS
For the quarters ended April 26, 2015 and April 27, 2014
(Not audited or reviewed by the Company's external auditor)
					Quarter ended
					April 26, 2015				April 27, 2014
Operating activities
	Net income (loss)			$	30,778			$	(206,789	)
	Adjustments for:
		Income tax expense (recovery)			17,810				(76,445	)
		Finance costs			111,602				120,443
		Depreciation and amortization of property, plant and equipment and intangibles			682,684				764,527
		Loss on disposal of property, plant and equipment			-				7,345
		Share-based payments			29,526				49,324
		Change in non-cash working capital related to operations			681,674				(1,539,945	)
	Less:
		Interest paid			(93,847	)			(94,047	)
Cash provided by (used in) operating activities					1,460,225				(975,587	)
Investing activities
	Purchase of property, plant and equipment				(552,663	)			(657,688	)
	Construction deposit paid				(620,183	)			-
	Purchase of intangible assets				(277,827	)			(145,789	)
Cash used in investing activities					(1,450,671	)			(803,477	)
Financing activities
	Increase in bank indebtedness				-				1,983,675
	Repayment of long-term debt				(223,102	)			(211,596	)
	Issuance of shares, net of fees				(13,256	)			6,985
Cash provided by (used in) financing activities					(236,358	)			1,779,064
Net increase/(decrease) in cash					(226,804	)			-
Cash, beginning of period					594,976				-
Cash, end of period				$	368,172			$	-

Additional Information

For further details the Company's complete management discussion and analysis (MD&A) and financial statements for the quarter ended April 26, 2015 will be available on the investor section of the Brick Brewing website at www.brickbeer.com. This and additional information relating to the Company, including its Annual Information Form, is or will be available on the Company's website and on SEDAR at www.sedar.com.

About Brick Brewing

Brick is the largest Canadian-owned brewery in Ontario. The Company is a regional brewer of award-winning premium quality and value beers and is officially certified under British Retail Consortium (BRC) Global Standards for Food Safety, one of the highest and most internationally recognized standards for safe food production. Founded in 1984, Brick Brewing Co. was the first craft brewery to start up in Ontario, and is credited with pioneering the present day craft brewing renaissance in Canada. Brick has complemented its Waterloo brand premium craft beers with other popular brands such as Laker, Red Baron, Red Cap and Formosa Springs Draft. In March 2011, Brick purchased the Canadian rights to the Seagram Coolers and now produces, sells, markets and distributes Seagram Coolers across Canada. Brick trades on the TSX under the symbol BRB. Visit us at www.brickbeer.com.

Forward-Looking Statements

All statements in this press release that do not directly and exclusively relate to historical facts constitute forward-looking statements as of the date of this press release. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "anticipate", "seek", "plan", "believe" or "continue" or the negatives of these terms or variations of them or similar terminology. Although the Corporation believes that the expectations and assumptions reflected in these forward-looking statements are reasonable, undue reliance should not be placed on these forward-looking statements, which are not guarantees and are subject to certain risks, uncertainties and assumptions, which may cause actual performance and financial results to differ materially from such forward-looking statements. The forward-looking statements included in this press release are made only at the date of this press release and, except as required by applicable securities laws, the Corporation does not undertake to publicly update such forward-looking statements to reflect new information, future events or otherwise.

* EBITDA is a non-IFRS earnings measure, therefore it does not have any standardized meaning prescribed by International Financial Reporting Standards and may not be similar to measures presented by other companies. EBITDA represents earnings before interest, income taxes, depreciation and amortization, gain on disposal of property, plant, and equipment, and share based payments. Management uses this measurement to evaluate the operating results of the Company. This measure is also important to management since it is used by the Company's lenders to evaluate the ongoing cash generating capability of the Company and therefore the amounts those lenders are willing to lend to the Company. Investors find EBITDA to be useful information because it provides a measure of the Company's operating performance.