BRICK BREWING ANNOUNCES Q3 RESULTS WITH EBITDA OF $984 THOUSAND

WATERLOO, ON, Dec. 9 /CNW/ - Brick Brewing Co. Limited ("Brick" or the "Company") (TSX: BRB), Ontario's largest Canadian-owned and Canadian-based publicly held brewery, today released its financial results for the third quarter.

Brick Brewing delivered EBITDA for the quarter ended October 31st, 2010 of $984 thousand, with net earnings of $213 thousand. The momentum on Brick brands continued in the third quarter with growth of 6%, compared to an industry volume decline of 2%.

"Brick Brewing continues to make significant strides in operating effectiveness. We have built a solid foundation for the business through a combination of strict cost management and targeted capital expenditures," said George Croft, President & CEO. "We now have the confidence in our operation that is required to aggressively pursue business development opportunities. Moving forward, volume growth is Brick Brewing's top priority."

In the third quarter, the Company signed agreements with two new co-pack customers and has also signed agreements for distribution of Brick Brands in the North-eastern United States and British Columbia, Canada. "We look forward to the first quarter of next year when we begin ramping up operations to meet production requirements created by our new customers," said Russell Tabata, Brick Brewing's Chief Technical Officer.

"The Laker family of brands grew by 22% in the period, building on the success in our previous quarter," said Mr. Croft. "The Company has landed on a winning consumer position which centres on 'Buy Local. Support Local'. Our award winning taste, appearance and price is converting drinkers to the Laker portfolio on a daily basis," added Mr. Croft.

The Company's volume of canned beer continues to grow rapidly with a 159% lift in the quarter and 87% on a year-to-date basis.

Some financial highlights of the quarter are as follows:

    
    -   Net revenue was $7.1 million compared to $7.3 million in the
        comparable period last year;

    -   Gross profit percentage has increased to 30.0% versus 24.6%; and

    -   EBITDA for the period ended October 31, 2010 was $984 thousand, an
        increase of 37.2% over the comparable period.

    -   Net income of $0.2 million.
    

The following financial statements should be read in conjunction with the audited annual financial statements of the Company.

    
    BRICK BREWING CO. LIMITED
    Consolidated Balance Sheet
    (unaudited)

    -------------------------------------------------------------------------
                                           Third quarter ended    Year ended
                                                    October 31,   January 31,
                                                          2010          2010
    -------------------------------------------------------------------------

    Assets
    Current assets:
      Accounts receivable                            6,716,140     2,357,069
      Inventories                                    5,492,059     5,251,714
      Prepaid expenses                                 446,208       412,351
      Future income taxes                              566,000       566,000
    -------------------------------------------------------------------------
                                                    13,220,407     8,587,134

    Property, plant and equipment                   15,266,798    14,101,122
    Intangible assets                                5,899,532     5,731,954
    Other assets                                             -       188,871
    Future income taxes                                434,000     1,034,000
    -------------------------------------------------------------------------
                                                  $ 34,820,737  $ 29,643,081
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities and Shareholders' Equity
    Current liabilities:
      Bank indebtedness                           $  1,243,959  $  1,792,406
      Accounts payable and accrued liabilities       6,374,822     3,187,915
      Current portion of long-term debt                624,000       816,100
      Current portion of obligations under
       capital lease                                   200,112       146,418
    -------------------------------------------------------------------------
                                                     8,442,893     5,942,839

    Long-term debt                                   2,800,834     1,251,800
    Obligations under capital lease                     30,763       138,106

    Shareholders' equity:
      Share capital                                 34,578,264    34,678,264
      Contributed surplus                              861,484       772,455
      Deficit                                      (11,893,501)  (13,140,383)
    -------------------------------------------------------------------------
                                                    23,546,247    22,310,336

    -------------------------------------------------------------------------
                                                  $ 34,820,737  $ 29,643,081
    -------------------------------------------------------------------------



    BRICK BREWING CO. LIMITED
    Consolidated Statement of Income, Comprehensive Income and Deficit
    (unaudited)

                             Third quarter ended   Fiscal year-to-date ended

    -------------------------------------------------------------------------
                        October 31,   October 31,   October 31,   October 31,
                              2010          2009          2010          2009
    -------------------------------------------------------------------------

    Gross revenue     $ 16,200,106  $ 15,717,895  $ 50,393,971  $ 51,141,174
      Less production
       taxes and
       distribution
       fees             (9,088,043)   (8,437,835)  (27,199,594)  (26,903,965)
    -------------------------------------------------------------------------
    Net revenue          7,112,063     7,280,060    23,194,377    24,237,209

    Cost of sales        4,975,708     5,491,103    16,073,451    17,914,082

    -------------------------------------------------------------------------
    Gross profit         2,136,355     1,788,957     7,120,926     6,323,127

    Selling,
     marketing and
     administration      1,124,734     1,067,183     3,699,876     3,122,059

    -------------------------------------------------------------------------
    Earnings before
     the undernoted      1,011,621       721,774     3,421,050     3,201,068

    Other expense:
      Depreciation and
       amortization       (579,577)     (328,187)   (1,393,559)   (1,382,990)
      Interest on
       long-term debt      (39,412)      (34,610)     (102,074)     (111,511)
      Other expense        (52,069)       (4,771)      (78,535)      (19,414)
    -------------------------------------------------------------------------
                          (671,058)     (367,568)   (1,574,168)   (1,513,915)

    -------------------------------------------------------------------------
    Net income before
     provision for
     income taxes          340,563       354,206     1,846,882     1,687,153

    Future income
     tax provision         128,000       112,690       600,000       553,463
    -------------------------------------------------------------------------
    Net income and
     comprehensive
     income                212,563       241,516     1,246,882     1,133,690

    Deficit,
     beginning of
     period            (12,106,064)  (13,613,924)  (13,140,383)  (14,506,098)
    -------------------------------------------------------------------------
    Deficit, end
     of period        $(11,893,501) $(13,372,408) $(11,893,501) $(13,372,408)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net earnings
     per share:
      Basic           $       0.01  $       0.01  $       0.04  $       0.04
      Diluted         $       0.01  $       0.01  $       0.04  $       0.04
    -------------------------------------------------------------------------



    BRICK BREWING CO. LIMITED
    Consolidated Statements of Cash Flows
    (unaudited)

                             Third quarter ended   Fiscal year-to-date ended

    -------------------------------------------------------------------------
                        October 31,   October 31,   October 31,   October 31,
                              2010          2009          2010          2009
    -------------------------------------------------------------------------

    Cash provided by
     (used in):

    Operations:
      Income for
       the period     $    212,563  $    241,516  $  1,246,882  $  1,133,690
      Items not
       involving cash:
        Amortization
         of property,
         plant and
         equipment,
         and other
         assets            579,577       335,688     1,393,702     1,405,491
        Stock based
         compensation       29,676        38,721        89,029        87,657
        Future income
         tax provision     128,000       112,690       600,000       553,463
    Change in non-cash
     operating working
     capital               208,821       (35,951)   (1,446,367)   (1,424,599)
    -------------------------------------------------------------------------
                         1,158,637       692,664     1,883,246     1,755,702
    Financing:
      Increase
       (decrease)
       in bank
       indebtedness       (202,990)      211,668      (548,447)    1,291,915
      Proceeds from
       new term
       debt, net           227,793             -     1,715,284             -
      Repayment of
       long-term debt     (150,000)     (408,150)     (358,350)     (865,650)
      Repayment of
       obligation under
       capital lease       (42,993)      (34,032)     (126,970)     (100,013)
      Change in share
       capital, net
       of fees            (100,000)            -      (100,000)        3,200
    -------------------------------------------------------------------------
                          (268,190)     (230,514)      581,517       329,452
    Investing:
      Purchase of
       property, plant
       and equipment,
       and other assets   (728,737)     (261,825)   (2,220,186)   (1,825,480)
      Purchase of
       intangible
       assets             (161,710)     (200,325)     (244,577)     (468,965)
    -------------------------------------------------------------------------
                          (890,447)     (462,150)   (2,464,763)   (2,294,445)

    -------------------------------------------------------------------------
    Net decrease
     in cash                     -             -             -      (209,291)

    Cash, beginning
     of period                   -             -             -       209,291

    -------------------------------------------------------------------------
    Cash, end of
     period           $          -  $          -  $          -  $          -
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Supplemental cash
     flow information:
      Cash paid for
       interest             47,004        35,254  $    132,159  $    114,582
    Non-cash investing
     and financing
     activities:
      Obligation under
       capital lease  $          -  $          -  $     73,321  $          -
    -------------------------------------------------------------------------
    

Additional Information

For further details the Company's management discussion and analysis (MD&A) and unaudited consolidated financial statements for the quarter ended October 31, 2010 will be available on the investor section of the Brick Brewing website at www.brickbeer.com. 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 Brewing Co. Limited is Ontario's largest Canadian-owned and Canadian-based publicly held brewery. The Company is a regional brewer of award winning premium quality and value beers. The Company, founded in 1984, was the first craft brewery to start up in Ontario, and is credited with pioneering the present day craft brewing renaissance in Canada. The Company has complemented its Waterloo family of premium craft beers with other popular brands such as Laker, Red Baron, Red Cap and Formosa Springs Draft. Brick trades on the TSX under the symbol BRB. Visit us at www.brickbeer.com

Forward-Looking Statements

Except for the historical information contained herein, the discussion in this press release contains certain forward-looking statements that involve risks and uncertainties, such as statements of the Company's plans, objectives, strategies, expectations and intentions and include, for example, the statements concerning expected volumes, operating efficiencies and costs. 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 Company 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. These forward-looking statements are not guarantees and reflect the Company's views as of December 9, 2010 with respect to future events. Future events 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, including the statements regarding expected volumes, operating efficiencies and costs are based on, among other things, the following material factors and assumptions: sales volumes in the fiscal year ending January 31, 2011 ("fiscal 2011") will decrease, no material changes in consumer preferences, brewing and packaging efficiencies will improve, input costs for brewing materials will decrease, the cost of packaging materials will decrease, competitive activity from other brewers will continue, no material change to the regulatory environment in which the Company operates, no material supply, cost or quality control issues with vendors, owner brand growth, market expansion and additional co-pack contracts. Readers are urged to consider the foregoing factors and assumptions when reading the forward-looking statements and, for more information regarding the risks, uncertainties and assumptions that could cause the Company's actual financial results to differ from the forward-looking statements, to also refer to the Company's MD&A, the Company's annual information form and various other public filings. The forward-looking statements included in the press release are made only as of December 9, 2010 and, except as required by applicable securities laws, the Company does not undertake to publicly update such forward-looking statements to reflect new information, future events or otherwise.

* EBITDA is a non-GAAP earnings measure, therefore it does not have any standardized meaning prescribed by Canadian generally accepted accounting principles and may not be similar to measures presented by other companies. EBITDA represents earnings before interest, income taxes, depreciation and amortization. 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.

SOURCE Brick Brewing Co. Limited

For further information: For further information: George Croft, President and CEO, Tel: (519) 576-9519 Ext. 247, E-mail: info@brickbeer.com

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