Liquor Stores Income Fund
TSX : LIQ.UN

Liquor Stores Income Fund

February 14, 2005 19:37 ET

Liquor Stores Income Fund Announces the Planned Addition of 15 Liquor Stores

EDMONTON, ALBERTA--(CCNMatthews - Feb. 14, 2005) - Liquor Stores Income Fund
(the "Fund") (TSX:LIQ.UN) announced today the planned acquisition of thirteen
additional liquor stores in Alberta and the development of two additional stores
in British Columbia. In Alberta, the Fund will be acquiring all 10 stores
operated by the Last Call Group, as well as three independently owned and
operated stores. The Last Call Group is the fourth largest independent chain of
liquor stores in Alberta. The acquisition of the new stores is subject to
customary closing conditions, and regulatory approvals. Closings are scheduled
to take place during February and March, 2005. The stores located in British
Columbia are expected to open in March, 2005. The total cost to the Fund of the
15 additional stores will be approximately $11.1 million, not including
inventory, and will be funded through the Fund's increased bank acquisition and
operating lines. Management estimates that these stores will initially
contribute approximately $2.2 million annually to EBITDA.

The Fund also announced that, subject to the closing of the Last Call
acquisitions, it intends to increase its annual distribution by $0.075 per unit
from $1.00 to $1.075 ($0.08958 per month), commencing with the distribution to
be paid to unitholders of record on May 31, 2005. The increase in unitholder
distributions is due to the continued strong financial performance of the Fund's
current business and the accretive nature of the acquisitions.

Irving Kipnes, President and CEO of the Fund, stated, "We are excited about the
addition of the new stores to the Fund and the other acquisition opportunities
that we are pursuing. Management estimates that the 15 stores should add in
excess of $35 million of revenue, representing an approximate 30% increase from
current levels. As a result of the addition of these stores and the other
opportunities that we are pursuing, we have increased the amounts available
under our operating line from $18 million to $24 million and our acquisition
line from $10 million to $20 million. We plan on continuing to execute our
growth strategy in both Alberta and British Columbia."

The Fund is an open-ended trust that holds, indirectly, securities of Liquor
Stores Limited Partnership ("Liquor Stores LP"). Liquor Stores LP is Alberta's
largest liquor store operator, by number of stores, and currently operates 49
stores in Alberta and 1 store in British Columbia, which will increase to 62
stores in Alberta and 3 in British Columbia upon completing the aforementioned
store acquisitions and openings. The trust units of the Fund trade on the
Toronto Stock Exchange under the symbol "LIQ.UN".

Additional information about Liquor Stores Income Fund is available at
www.sedar.com.

Disclaimer

Certain statements in this news release are "forward-looking statements", which
reflect management's expectations regarding the future growth, proposed
acquisitions, results of operations, performance, business prospects,
opportunities and the amount and timing of the payment of distributions of the
Fund. All statements other than statements of historical fact contained in this
news release are forward-looking statements. Such forward-looking statements
involve risks and uncertainties, as they reflect management's current beliefs
and are based on information currently available to management. Actual results
may differ materially from those anticipated in the statements made. The
forward-looking statements are expressly qualified in their entirety by this
cautionary statement. The forward-looking statements are made as of the date of
this news release and the Fund assumes no obligation to update or revise them to
reflect new events or circumstances. Further information regarding the
uncertainties and risks can be found in the disclosure documents filed by the
Fund with the securities regulatory authorities, available at www.sedar.com.

Non-GAAP measures: References to "EBITDA" in this news release are to earnings
before provision of interest, income taxes and amortization. Readers are
cautioned that EBITDA and cash flow are not defined performance measures under
Canadian generally accepted accounting principles and that EBITDA cannot be
assured. The Fund's calculation of EBITDA and cash flow may differ from similar
calculations by comparable entities.

Contact Information

  • Liquor Stores GP Inc.
    Irv Kipnes
    Chief Executive Officer
    (780) 944-9994 ext. 6
    or
    Liquor Stores GP Inc.
    Tom Orysiuk
    Chief Financial Officer
    (780) 917-4179