Big Rock Brewery Income Trust
TSX : BR.UN

Big Rock Brewery Income Trust
BIG ROCK BREWERY LTD.

BIG ROCK BREWERY LTD.

March 26, 2007 08:00 ET

Big Rock Brewery Income Trust Announces Record Earnings and Increase to Monthly Distribution

CALGARY, ALBERTA--(CCNMatthews - March 26, 2007) - Big Rock Brewery Income Trust (the "Trust") (TSX:BR.UN) is pleased to report to Unitholders its consolidated financial results for the three months and year ended December 31st, 2006. These results reflect the consolidated operations of the Trust, Big Rock Brewery Ltd. and its wholly owned subsidiary Pine Creek Brewing Company Ltd.

As a result of record earnings for 2006, the Trust is pleased to announce that it will increase its monthly cash distribution to Unitholders by $0.02 to $0.13 per unit. The increase will take effect for the May 15, 2007 distribution paid to all Unitholders of record on April 30, 2007. The trust units will commence trading on an ex-dividend basis on April 26, 2007. The increase results in an annualized distribution of $1.56 per trust unit.

Financial Highlights for the year ended December 31, 2006 are as follows:

Net income for the year ending December 31, 2006 was $8,380,065 compared to $6,619,876 for the year ended December 31, 2005, a 27% increase.

Net income per unit increased to $1.39 for the year ended December 31, 2006 compared to $1.12 last year.

Distributable cash per unit increased to $1.54 for the year ended December 31, 2006 compared to $1.35 last year (after providing for productive capacity maintenance).

Cash distributions declared to Unitholders for the year ended December 31, 2006 were $7,947,575 or $1.32 per unit (86% of distributable cash) up from $7,655,208 or $1.29 per unit (96% of distributable cash) in 2005.

For the year ended December 31, 2006, sales revenue decreased $1,862,505 (5%) to $38,700,675 from $40,563,180 in 2005. The reduction in sales revenue resulted from a planned significant reduction in selling and marketing expenses during the year. Selling expenses decreased by $1,522,782 (13%) to $10,146,950 compared to $11,669,732 last year resulting in the improved bottom line.

Big Rock has $4,336,830 in cash and cash equivalents at year-end (December 31, 2005 - $5,722,465) and no drawings on operating or long-term debt facilities.

On November 15, 2006 the Toronto Stock Exchange approved a Normal Course Issuer Bid whereby Big Rock Brewery Income Trust may repurchase up to 2% of the outstanding trust units in any 30 day period to a maximum of 5% of the issued and outstanding trust units during any 12 month period. During 2006, the Trust expended $470,000 to repurchase and cancel 34,600 units at an average price of $13.58/unit.

Financial Highlights for the three months ended December 31, 2006 are as follows:

Net income for the three months ended December 31, 2006 was up $185,108 (11%) to $1,883,998 from $1,698,890 for the same period last year.

During the 4th quarter ended December 31, 2006 net sales revenue decreased by $1,404,083 (14%) from $10,007,311 to $8,603,228 in the same quarter last year. The decrease was a result of the volume decrease due to a planned reduction of sales programs. Accordingly, selling expenses for the three months ended December 31, 2006 were down $418,988 (16%) to $2,240,567 from $2,659,555 in the same quarter last year.

The net income increase is comprised of a $297,131 decrease in gross profit, a $54,585 increase in general and administrative expense offset by a $203,341 decrease in income tax expense.

Net income per unit for the three months ended December 31, 2006 was $0.30 up 3% from $0.29 in the same quarter last year.

Selected financial information follows:



Big Rock Brewery Income Trust
Consolidated Balance Sheets
Unaudited
As at December 31 2006 2005

Assets
Current
Cash and cash equivalents $ 4,336,830 $ 5,722,465
Accounts receivable 3,233,671 3,848,397
Inventories 3,710,427 3,048,610
Prepaid expenses 273,100 150,685
--------------------------
11,554,028 12,770,157

Property, plant and equipment 30,171,939 28,615,246
Deferred charges and other assets 444,762 400,774

--------------------------
Total assets $42,170,729 $41,786,177
--------------------------
--------------------------

Liabilities and Unitholders' Equity
Current
Accounts payable and accrued liabilities 2,819,987 2,746,468
Income taxes payable 896,004 489,679
Distributions payable 660,692 659,756
--------------------------
4,376,683 3,895,903

Future income taxes 7,426,762 8,060,167

--------------------------
Total liabilities 11,803,445 11,956,070

Unitholders' equity
Trust unitholders capital 18,282,507 17,872,741
Contributed surplus 345,948 286,953
Undistributed income 11,738,829 11,670,413

--------------------------
Total Unitholders' equity 30,367,284 29,830,107

--------------------------
Total Liabilities and Unitholders' equity $42,170,729 $41,786,177
--------------------------
--------------------------


Big Rock Brewery Income Trust
Consolidated Statements of Operations & Undistributed Income
Unaudited

Twelve months ended Three months ended
December 31, December 31, December 31, December 31,
2006 2005 2006 2005

Revenue
Net Sales $38,700,675 $40,563,180 $8,603,228 $10,007,311

Cost of sales 13,773,219 15,255,008 $2,558,700 $ 3,665,652

------------ ------------ ----------- ------------
Gross profit 24,927,456 25,308,172 6,044,528 6,341,659

Expenses
Selling 10,146,950 11,669,732 $2,240,567 $ 2,659,555
General &
administrative 3,881,657 3,808,582 $1,073,812 $ 1,019,227
Interest 1,363 $ 459 ($1,058)
Amortization 2,152,826 2,111,375 $ 612,113 $ 556,554
------------ ------------ ----------- ------------

16,182,796 17,589,689 3,926,951 4,234,278

Gain on sale
of Kamloops
Brewery - 28,429 - 28,429
------------ ------------ ----------- ------------

Income before
income taxes 8,744,660 7,746,912 2,117,577 2,135,810

Current income
tax expense 998,000 461,000 $ 90,909 92,933
Future income
tax expense (633,405) 666,036 $ 142,670 343,987
------------ ------------ ----------- ------------
364,595 1,127,036 233,579 436,920
------------ ------------ ----------- ------------

Net income for
the period 8,380,065 6,619,876 1,883,998 1,698,890

Undistributed
income,
beginning of
period 11,670,413 12,705,745 12,208,510 11,945,371
Cash
distributions (7,947,575) (7,655,208) ($1,989,605) (1,973,848)
Excess
consideration
paid on unit
repurchase (364,074) - (364,074) -

------------ ------------ ------------ ------------

Undistributed
income, end
of period $11,738,829 $11,670,413 $11,738,829 $11,670,413
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------

Net income
per unit
Basic $ 1.39 $ 1.12 $ 0.30 $ 0.29
Diluted $ 1.38 $ 1.12 $ 0.29 $ 0.29


Big Rock Brewery Income Trust
Consolidated Statements of Cash Flow
Unaudited

Twelve months ended Three months ended
December 31, December 31, December 31, December 31,
2006 2005 2006 2005
Operating
Activities
Net income for
the period $8,380,065 $6,619,876 $1,883,998 $1,698,890
Items not
affecting cash:
Amortization 2,152,826 2,111,375 612,113 556,554
Gain on sale
of Kamloops
Brewery - (28,429) - (28,429)
Unit based
compensation 76,000 258,660 22,521 -
Future income
taxes (633,405) 666,036 142,670 343,987
------------ ------------ ------------ ------------
9,975,486 9,627,518 2,661,302 2,571,002

Net change in
non-cash
working capital 310,338 (605,965) (1,087,826) 36,416

------------ ------------ ------------ ------------
Cash provided by
operating
activities 10,285,824 9,021,553 1,573,476 2,607,418


Financing
Activities
Distribution
payments (7,946,639) (7,581,394) (1,992,630) (1,970,239)
Unit repurchase (470,000) - (470,000) -
Cash received on
exercise of
options 498,687 1,086,628 128,311 269,115

------------ ------------ ------------ -----------
Cash used in
financing
activities (7,917,952) (6,494,766) (2,334,319) (1,701,124)

Investing
Activities
Additions to
capital assets (3,709,519) (3,578,174) (1,045,230) (672,682)
Proceeds on sale
of Kamloops
Brewery - 4,724,209 - 4,724,209
Deferred charges
and other assets (43,988) (44,052) (5,000) (4,238)

------------ ------------ ------------ -----------
Cash provided by
(used in)
investing
activities (3,753,507) 1,101,983 (1,050,230) 4,047,289

Net increase
(decrease) in
cash (1,385,635) 3,628,770 (1,811,073) 4,953,583

Cash and cash
equivalents,
beginning of
period 5,722,465 2,093,695 6,147,903 768,882

------------ ------------ ------------ -----------
Cash and cash
equivalents,
end of period $4,336,830 $5,722,465 $4,336,830 $5,722,465
------------ ------------ ------------ -----------
------------ ------------ ------------ -----------


Big Rock is a regional producer and marketer of premium quality beers, headquartered in Calgary, Alberta, Canada. Big Rock's products are available in draught, bottles and cans. The Company also produces or distributes cider and cooler products. Big Rock products are marketed in seven provinces and two territories in Canada.

Contact Information

  • Big Rock Brewery Ltd.
    Ed McNally
    Chairman
    (403) 720-3239
    or
    Big Rock Brewery Ltd.
    Ken Barbet
    President and CEO
    (403) 720-3239
    or
    Big Rock Brewery Ltd.
    Tim Duffin, C.A.
    Chief Financial Officer
    (403) 720-3239