Centerplate Reports Strong Fourth Quarter and Full-Year 2006 Results



    STAMFORD, Conn., March 7 /CNW/ -- Centerplate, Inc. (Amex:   CVP)(TSX:
CVP.un) today reported financial results for the fourth quarter and fiscal
year ended January 2, 2007.  Net sales of $681.1 million for fiscal year 2006
increased 5.9% from $643.1 million in fiscal year 2005. Adjusted earnings
before interest, income taxes, depreciation and amortization (EBITDA)
increased 7.6% to $57.5 million for 2006 compared to $53.5 million in 2005. 
The increase in adjusted EBITDA for the year was primarily due to higher sales
volume and lower selling, general and administrative expenses (SG&A).
    "2006 was a great year for Centerplate, capped by a very strong fourth
quarter.  For the full-year we increased revenues and adjusted EBITDA, made
great strides with our core strategic initiatives, strengthened our management
team, and implemented an enhanced organizational structure to better serve our
customers," said Janet L. Steinmayer, President and Chief Executive Officer of
Centerplate.  She added, "We remain focused on executing on our strategic
vision in 2007 -- delivering creative, value-added solutions, partnering with
clients on initiatives that are attractive and profitable to both parties, and
being an innovator in all aspects of our business."
    The net sales increase in fiscal year 2006 was primarily due to higher
sales at the company's convention centers, Major League Baseball (MLB)
facilities and arenas which increased $15.3 million, $13.6 million and $9.2
million, respectively.  Higher sales at convention centers were primarily
driven by an increase in the number of events held at these facilities.  At
the company's MLB facilities, an overall increase in attendance and per capita
spending resulted in higher net sales, while sales at arenas were positively
impacted by the resolution of the National Hockey League (NHL) lock-out and an
increase in the number of college basketball tournaments held in a number of
these facilities.  Net sales at all other facilities increased by $6.0
million, primarily due to increases at the company's National Football League
(NFL) venues ($4.8 million).  Partially offsetting this improvement was a
decline in sales of $6.1 million (net of new accounts) associated with the
non-renewal of some of the company's contracts.
    Net sales in the fourth quarter increased 8.8%, to $158.0 million,
compared to net sales of $145.2 million in the fourth quarter of 2005.
Adjusted EBITDA increased 6.8% to $10.7 million in the fourth quarter of 2006
compared to $10.1 million in the fourth quarter of 2005.  The increase in
adjusted EBITDA was primarily due to higher sales in 2006 and non-recurring
expenses incurred in 2005.  NFL sales in the quarter improved $11.4 million
due to five additional games played in the fourth quarter of 2006 compared to
2005.  In addition, convention center sales increased $2.3 million and new
accounts, net of closed accounts, added an additional $2.4 million in sales.
This was partially offset by a $3.3 million decline in MLB sales because the
regular MLB baseball season ended in the company's third quarter in 2006
versus the fourth quarter in 2005.
    For the full year 2006, Centerplate reported net income of $3.5 million
compared to a loss of $4.6 million in 2005.  On a per share basis, Centerplate
reported net income of $0.15 per share in 2006 versus a loss of $0.20 per
share for fiscal 2005.  The improvement in net income and earnings per share
in 2006 was primarily due to a one-time charge of $5.8 million related to the
refinancing of the company's senior credit facility in April 2005.  For the
fourth quarter of 2006, Centerplate reported a net loss of $3.1 million
compared to a net loss of $2.2 million in the fourth quarter of 2005.  On a
per share basis, Centerplate reported a net loss of $0.14 per share in the
fourth quarter of 2006 compared to a net loss of $0.10 per share in the fourth
quarter of 2005.  The decline in net income during the fourth quarter of 2006
was primarily due to lower income tax benefits which was partially offset by
an increase in operating income.
    As previously announced, Centerplate will make its 39th distribution to
IDS holders on March 20, at the annual rate of approximately $1.56 per IDS.
    Centerplate will discuss its fourth quarter and year-end 2006 financial
results on a conference call at 5:30 p.m. (EST) on Wednesday, March 7, 2007.
Interested parties may participate in the call by dialing 877-407-8029
approximately 10 minutes before the call is scheduled to begin.  International
callers should dial 201-689-8029.  An audio web cast of the conference call
can also be accessed via www.centerplate.com. For individuals unable to
participate in the conference call, a telephone replay will be available from
8:00 p.m. on March 7, 2007 through midnight on March 21, 2007.  The replay can
be accessed domestically by dialing 877-660-6853.  For international callers,
the dial-in number is 201-612-7415.  The replay account number for the call is
252 and the pass code for the replay call is 231822.

    
    About Centerplate
    
    Centerplate is a leading provider of catering, concessions, merchandise
and facility management services for sports facilities, convention centers and
other entertainment venues.  Visit the company online at www.centerplate.com.

    
    Presentation of Information in this Press Release
    
    Centerplate presents Adjusted EBITDA because covenants in the indenture
governing the company's subordinated notes contain ratios based on this
measure.  A reconciliation of Adjusted EBITDA to net income or loss is
included in the attached tables.

    
    Forward-Looking Statements
    
    This news release includes forward-looking statements within the meaning
of Section 27A of the Securities Act and Section 21E of the Securities
Exchange Act. These statements may involve risks and uncertainties that could
cause actual results to differ materially from those described in such
statements. Although Centerplate believes that the expectations reflected in
these forward-looking statements are reasonable, the company can give no
assurance that these expectations will prove to have been correct or that they
will occur.  Important factors beyond Centerplate's control, including general
economic conditions, consumer spending levels, changing trends in our business
and competitive environment, adverse weather conditions and other factors, as
well as the risks identified in our most recent annual report on Form 10-K,
could cause actual results to differ materially from Centerplate's
expectations.  Centerplate undertakes no obligation to update or review any
forward-looking statement, whether as a result of new information, future
developments or otherwise.



    
                                CENTERPLATE, INC.
                 CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)


                              13 Weeks    14 Weeks    52 Weeks    53 Weeks
                               Ended       Ended       Ended       Ended
                             January 2,  January 3,  January 2,  January 3,
                                2007        2006        2007        2006
                                   (In thousands, except share data)

    Net sales                  $157,987    $145,202    $681,120    $643,112

    Cost of sales               128,919     117,657     554,752     519,395
    Selling, general and
     administrative              18,854      18,017      70,538      71,405
    Depreciation and
     amortization                 7,517       7,822      28,854      29,255
    Transaction related
     expenses                       700       1,006         700       1,006
    Contract related losses         258          89         358         369

    Operating income              1,739         611      25,918      21,682

    Interest expense              6,112       5,796      24,360      31,274

    Other income, net              (526)       (524)     (1,690)     (1,151)

    Income (loss) before
     income taxes                (3,847)     (4,661)      3,248      (8,441)

    Income tax benefit             (720)     (2,467)       (230)     (3,853)
    Net income (loss)           $(3,127)    $(2,194)     $3,478     $(4,588)

    Basic and diluted net
     income (loss) per share
     with and without
     conversion option           $(0.14)     $(0.10)      $0.15      $(0.20)

    Weighted average shares
     outstanding with
     conversion option        4,060,997   4,060,997   4,060,997   4,060,997
    Weighted average shares
     outstanding without
     conversion option       18,463,995  18,463,995  18,463,995  18,463,995
    Total weighted average
     shares outstanding      22,524,992  22,524,992  22,524,992  22,524,992

    Dividends declared per
     share                        $0.20       $0.20       $0.79       $0.79


    

    CENTERPLATE, INC.   RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED
EARNINGS BEFORE INTEREST,
    INCOME TAXES, DEPRECIATION, AND AMORTIZATION (UNAUDITED)


    
                                          13 Weeks 14 Weeks 52 Weeks 53 Weeks
                                            Ended    Ended    Ended    Ended
                                           January  January  January  January
                                           2, 2007  3, 2006  2, 2007  3, 2006
                                                     (In thousands)
    Net income (loss)                      $(3,127) $(2,194)  $3,478  $(4,588)
    Income tax benefit                        (720)  (2,467)    (230)  (3,853)
    Income (loss) before income taxes       (3,847)  (4,661)   3,248   (8,441)
    Adjustments:
    Interest expense (1)                     6,112    5,796   24,360   31,274
    Depreciation and amortization            7,517    7,822   28,854   29,255
    EBITDA (2)                              $9,782   $8,957  $56,462  $52,088


    The following adjustments to EBITDA
     were made to compute Adjusted EBITDA:

    EBITDA                                  $9,782   $8,957  $56,462  $52,088
    Adjustments:
    Transaction related expenses (3)           700    1,006      700    1,006
    Contract related losses (4)                258       89      358      369
    Adjusted EBITDA (2)                    $10,740  $10,052  $57,520  $53,463


    (1)  Included in interest expense for the 53 weeks ended  January 3, 2006
         is $5.8 million in expenses related to entering into our credit
         agreement on April 1, 2005.  The $5.8 million includes a prepayment
         premium of approximately $4.6 million on the prior credit facility
         and a $1.2 million non-cash charge for the write-off of deferred
         financing costs.  Additionally, for the 13 and 52 weeks ended January
         2, 2007 included in interest is a non-cash credit of $1.0 million and
         $3.4 million, respectively, related to the change in the fair value
         of our derivatives as compared to $1.0 million and $40,000,
         respectively, for the 13 and 53 week periods ended January 3, 2006.
    (2)  EBITDA is not a measure in accordance with GAAP.  EBITDA is not
         intended to represent cash flows from operations as determined by
         GAAP and should not be used as an alternative to income (loss) before
         taxes or net income (loss) as an indicator of operating performance
         or to cash flows as a measure of liquidity.  We believe that EBITDA
         is an important measure of the cash returned on our investment in
         capital expenditures under our contracts.  Adjusted EBITDA as defined
         in the indenture governing our subordinated notes issued in 2003, is
         determined as EBITDA as adjusted for transaction related expenses,
         contract related losses, other non-cash charges, and the former
         annual management fee paid to affiliates of Blackstone and GE
         Capital, less any non-cash credits.  We present Adjusted EBITDA
         because covenants in the indenture governing our 2003 notes contain
         ratios based on this measure and it is used by management to among
         other things evaluate our ability to make interest and dividend
         payments.
    (3)  Reflects expenses incurred in connection with the contemplated
         follow-on offering to the Company's 2003 initial public offering.
    (4)  Reflects non-cash expense for the write-off of impaired assets
         associated with the Company's contracts.



                                CENTERPLATE, INC.
                 SELECTED CONSOLIDATED CASH FLOW DATA (UNAUDITED)
                                  (in thousands)

                                          13 Weeks 14 Weeks 52 Weeks 53 Weeks
                                            Ended    Ended    Ended    Ended
                                           January  January  January  January
                                           2, 2007  3, 2006  2, 2007  3, 2006
         CASH FLOWS FROM OPERATING
          ACTIVITIES:
         Net income (loss)                 $(3,127) $(2,194)  $3,478  $(4,588)
         Adjustments to reconcile net
          income (loss) to net cash
          provided by (used in)
          operating activities:
             Depreciation and amortization   7,517    7,822   28,854   29,255
             Amortization of deferred
              financing costs                  642      649    2,569    3,474
             Charge for impaired assets        258    1,095      358    1,375
             Non-cash interest earned on
              restricted cash                 (145)    (104)    (455)    (196)
             Derivative non-cash interest   (1,010)  (1,017)  (3,364)     (40)
             Deferred tax change              (710)  (2,161)    (707)  (3,547)
             Loss on disposition of assets      54       62       22       15
             Other                            (281)      53        9      157

            Changes in assets and
             liabilities                    (9,071) (19,709)   8,562    2,503

                 Net cash provided by
                  (used in) operating
                  activities                (5,873) (15,504)  39,326   28,408

         CASH FLOWS FROM INVESTING
          ACTIVITIES:
            Purchase of property and
             equipment                      (4,147)  (2,855) (13,752) (14,712)
            Proceeds from sale of property
             and equipment                     -       (118)     250      338
            Purchase of contract rights     (1,609)  (1,369) (14,014) (10,363)
            Return of unamortized capital
             investment                        -        -      1,828      -
            Restricted cash                (13,050)     -    (13,050)     -

                 Net cash used in
                  investing activities     (18,806)  (4,342) (38,738) (24,737)

         CASH FLOWS FROM FINANCING
          ACTIVITIES:
            Repayments - revolving loans    (5,000)     -    (10,000) (44,250)
            Borrowings - revolving loans    20,000      -     25,000   44,250
            Principal payments on long-
             term debt                        (268)    (537)  (1,075)    (806)
            Proceeds from issuance of
             long-term debt                    -        -        -    107,500
            Retirement of existing long-
             term borrowings                   -        -        -    (65,000)
            Payments of financing costs        -        (19)     -     (7,266)
            Dividend payments               (4,460)  (4,460) (17,840) (17,840)
            Increase (decrease) in bank
             overdrafts                     (1,340)  (4,958)   1,508   (3,626)

                 Net cash provided by
                  (used in) financing
                  activities                 8,932   (9,974)  (2,407)  12,962

         INCREASE (DECREASE) IN CASH       (15,747) (29,820)  (1,819)  16,633

         CASH AND CASH EQUIVALENTS:
         Beginning of period                55,338   71,230   41,410   24,777

         End of period                     $39,591  $41,410  $39,591  $41,410



                        CENTERPLATE, INC.
       SELECTED CONSOLIDATED BALANCE SHEET DATA (UNAUDITED)


                                         January 2, January 3,
                                            2007       2006
    ASSETS                                  (in thousands)
      Current assets                      $102,194    $88,790
      Property and equipment, net           50,684     49,725
      Contract rights, net                  79,209     80,557
      Cost in excess of net assets
       acquired                             41,142     41,142
      Deferred financing costs, net         12,930     15,499
      Other assets                          46,211     42,312
    TOTAL ASSETS                          $332,370   $318,025

    LIABILITIES AND STOCKHOLDERS' EQUITY
      Current liabilities                  $98,700    $70,822
      Long-term debt                       209,789    210,864
      Other liabilities                      8,279      6,384

      Common Stock with conversion
       option, par value $0.01,
       exchangeable for subordinated
       debt, net of discount                14,352     14,352

      Total stockholders' equity             1,250     15,603
    TOTAL LIABILITIES AND STOCKHOLDERS'
     EQUITY                               $332,370   $318,025

    




For further information:

For further information: Gael Doar, Director of Communications of 
Centerplate, Inc., +1-203-975-5941, or gael.doar@centerplate.com Web Site:
http://www.centerplate.com/

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