Company Reports Fourth Consecutive Quarter of Positive System Sales and Same Restaurant Sales Growth,
and Continued Growth in Operating EBITDA of 12%

MONTREAL, June 8, 2016 /CNW Telbec/ - Imvescor Restaurant Group Inc. ("IRG" or the "Company") (TSX: IRG), a leading franchisor of restaurants operating 226 locations in Eastern Canada, reported financial results today for the 13 weeks ended May 1, 2016 ("Q2 2016"). This press release should be read in conjunction with the Company's management discussion and analysis and financial statements for Q2 2016 which are available on the Company's website at www.imvescor.ca/investor-relations and have been posted on SEDAR at www.sedar.com.

"The second quarter of fiscal 2016 was again demonstrative of the initial success of our strategic plan as we saw our fourth consecutive quarter of positive year-over-year growth in System Sales and Same Restaurant Sales at 3.6% and 1.2%, both of which were significant improvements over the same quarter of last year," said Frank Hennessey, President and Chief Executive Officer of Imvescor Restaurant Group Inc. "Importantly, we achieved this growth in the context of 3% fewer operating weeks, due to planned restaurant closures as part of the Restaurant Rejuvenation Plan. Our continued top-line growth, combined with our ongoing focus on costs contributed to a 12% year-over-year increase in operating EBITDA."

"With each quarter, we are making further progress on the strengthening of each of the four pillars that will underpin our long-term success – Quality of Food, Quality of Service, Value and Ambiance.  We have now completed renovations of 17 restaurants to date, including our first Mike's location during the second quarter, with 25 more planned for fiscal 2016.  We continue to be very encouraged by the improved operating results at these restaurants post-renovation. Such results continue to drive participation in the Restaurant Rejuvenation Program by franchisees."

Q2 2016 Financial and Operational Highlights

(All comparable figures are to second quarter 2015 ("Q2 2015") unless otherwise specified. 

• System Sales grew 3.6%;
• Same Restaurant Sales (SRS) grew 1.2%, an improvement of 1.4 percentage points compared with Q2 2015;
• Revenue increased 24% versus Q2 2015 mainly from the Company temporarily taking over the operations of the manufacturer of certain Trattoria di Mikes licensed retail products;
• EBITDA of $4.1 million was an increase of 7% versus Q2 2015;
• Operating EBITDA increased 12% to $4.3 million in Q2 2016 versus $3.8 million in Q2 2015;
• Operating expenses increased 31% versus Q2 2015 due mainly to the Company temporarily taking over the operations of the manufacturer of certain Trattoria di Mikes licensed retail products;
• Net earnings of $2.7 million increased 5% versus Q2 2015.

Highlights Subsequent to Quarter End

On May 6, 2016, the Company purchased for cancellation 1,500 common shares under its previously announced normal course issuer bid.

Q2 2016 Selected Financial Data

Dividend Declaration

Pursuant to its previously announced dividend policy, the board of directors of the Company (the "Board") today declared a dividend of $0.0225 per common share. The quarterly cash dividend will be paid on July 6, 2016 to shareholders of record as of the close of business on June 22, 2016.

The declaration and payment of any future dividend remains at the discretion of the Board and will depend on the Company's current and anticipated cash requirements and surplus, capital expenditures requirements, regulatory restrictions, financial results, future prospects, current and future contractual restrictions, such as restrictions under credit or other arrangements, the satisfaction of solvency tests imposed by the Canada Business Corporations Act for the declaration of dividends and other factors deemed relevant by the Board. Any dividend policy established by the Board, including the Company's current dividend policy can be changed at any time and is not binding on the Company. There can be no guarantee that the Company will maintain its current dividend policy or any dividend policy or that any dividend will be declared or paid.

Conference Call Details

Frank Hennessey, President and Chief Executive Officer, and Tania M. Clarke, Chief Financial Officer will host a conference call to discuss Q2 2016 results at 8:30 am E.S.T on Wednesday, June 8, 2016. To access the conference call by telephone, dial 1-888-231-8191 (Toll-Free), 514-807-9895 (Montreal) or 647-427-7450 (Toronto). 

A live audio webcast of the conference call will be available at www.imvescor.ca/investor-relations/. A recording of the conference call will be archived for replay by telephone until Wednesday, June 15, 2016 at midnight. To access the archived conference call, dial 1-855-859-2056 (Toll-Free), 514-807-9274 (Montreal) or 416-849-0833 (Toronto) and enter the reservation number 6427554.    

About Imvescor Restaurant Group Inc. Imvescor Restaurant Group Inc. is a dynamic and innovative organization in the family and casual dining restaurant industry. The Company is a franchise and licensing business that operates restaurants in Eastern Canada under four banners: Pizza Delight^®, operating primarily in Atlantic Canada, in the family/mid-scale segment, Trattoria di Mikes^® and Scores^®, operating primarily in Québec in the family and casual dining segments and the take-out and delivery segments, and Bâton Rouge^®, operating in Québec, Ontario and Nova Scotia in the casual dining segment. The Company also licenses to third parties the right to manufacture and sell prepared food products under the Pizza Delight^®, Trattoria di Mikes^®, Scores^® and Bâton Rouge^® brands and, through its wholly-owned subsidiary, Groupe Commensal Inc., manufactures and sells vegetarian branded food products in grocery stores and retail outlets under the Commensal^® brand.

Non-IFRS Measures and Financial Metrics: The information contained in this press release includes some figures that are not performance measures consistent with International Financial Reporting Standards ("IFRS"). Because they do not have a standardized meaning prescribed by IFRS, they may not be comparable with similar measures presented by other issuers. 

"EBITDA" is defined as earnings or loss before interest income, interest expense, depreciation and amortization and income tax expense.

"Operating EBITDA" is defined as EBITDA adjusted for the following items; impairment or impairment reversal of non-current assets, impairment or impairment reversal of Imvescor rights, gain or losses on sale of property, plant and equipment, change in onerous contract provisions, costs of special committee, shareholder proposal costs, impairment of goodwill, bargain purchase gains, reorganization costs, restaurant rejuvenation plan, gain or loss on derivative financial liability and earnings or loss from discontinued operations. The definition of Operating EBITDA can change from time to time to account for unusual items or items not considered to be consistent with the Company's normal recurring operations.

The Company uses EBITDA and Operating EBITDA because those measures enable management to assess the Company's operational performance and are financial indicators of the Company's ability to service and incur debt. Those measures should not be considered by an investor as an alternative to earnings, an indicator of operating performance or cash flows, or as a measure of liquidity.  Refer to the Reconciliations of Non-IFRS Measures section of this MD&A for more details.

"System Sales" is the aggregate sales achieved by all "Pizza Delight", "Trattoria di Mikes", "Scores" and "Bâton Rouge" restaurants, whether they are company-owned restaurants or franchises.  This performance measure indicates the Company's overall growth and reflects the direct impact of the restaurant openings and closures. 

"Same Restaurant Sales" or "SRS" is a metric used in the restaurant industry to compare sales earned in established locations over a certain period of time, such as a fiscal quarter, for the current period against sales in the same period in the previous year. SRS growth helps explain what portion of sales growth can be attributed to growth in established locations. The Company defines SRS as sales generated by stores that have been open for at least one year compared to the sales from the same group of restaurants in the comparable period.  The Company believes this is a meaningful measure of operating performance.

"Free cash flow" is defined as cash from operating activities less cash used in the purchases of property, plant and equipment and intangible assets.

"Net debt to Operating EBITDA" is calculated as long-term debt, including the current portion, less cash, divided by Operating EBITDA for the last four fiscal quarters.

Cautionary Note Regarding Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of applicable securities laws, including but not limited to, IRG's business objectives, estimates, outlook, strategies and priorities and all other statements other than statements of historical facts. Forward-looking statements may include estimates, intentions, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Forward-looking statements are often, but not always, identified by the use of words such as "may", "should", "would", "will", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential, "targeting", "intend", "could", "might", "continue", "outlook" or the negative of these terms or other comparable terminology. All such forward-looking statements are made pursuant to the "safe harbour" provisions of applicable securities laws.

Forward-looking statements involve known and unknown risks, uncertainties and other factors outside of IRG's control. A number of factors could cause the actual results of IRG to differ materially from the results discussed in the forward-looking statements, including, but not limited to: risks associated with quality control, food borne illnesses and health concerns, adverse changes to economic conditions, the Company's ability to retain certain key personnel, the Company's ability to respond to various competitive factors affecting its operations, franchise development and growth of the retail licensing opportunities, changes in consumer preferences, the Company's retail products dependence on the strength of the Company's restaurant brands, the protection of the Company's intellectual property, the success of the restaurant rejuvenation plan, the Company's dependence on royalty stream, the Company's reliance on suppliers and availability and quality of raw materials, changes in the Company's relationships with its franchisees, the Company's ability to open new restaurants, the closure of restaurants, the impact of an increase in Company-owned restaurants, the Company's ability to renew leases and limit lease exposure, the risks associated with negative publicity and its impact on the Company's reputation, compliance with regulations governing confidentiality of guest information, potential litigation and other complaints, compliance with government regulations, the Company's dependence on third parties, changes in laws concerning employees, changes in the Company's relationships with its employees, the Company's ability to ensure workplace safety, risks associated with franchise regulations, compliance with regulations governing alcoholic beverages, environmental risks and regulations, public safety issues, the Company's dependence on technology, risks of underreporting of sales by franchisees, inherent risks associated with internal control over financing reporting, the indebtedness of the Company and the restrictive covenants to which it is subject, the impact of sales tax upon System Sales, the risk associated with the Company's dividend policy, the impact of seasonality and other factors on quarterly operating results, the risk of uninsured losses, changes in commodity prices and other factors referenced in the Company's Annual Information Form and the Company's other continuous disclosure filings which are available on SEDAR at www.sedar.com. These factors are not intended to represent a complete list of the factors that could affect IRG but should, however, be considered carefully.

Further, although the forward-looking statements contained herein are based on information currently available to IRG's management and on the current assumptions, intentions, plans, expectations, estimates, opinions, forecasts, projections and other assumptions made by IRG's management in light of its experience and perception of historical trends, current conditions and expected future developments (such as IRG's future growth, results of operations, performance and opportunities as well as the future of the economic environment in which it operates), as well as other factors that IRG's management believes are appropriate and reasonable in the circumstances and on the date of this press release, there can be no assurance that such assumptions, intentions, plans, expectations, estimates, opinions, forecasts, projections and other assumptions will prove to be correct or that actual results will not differ materially from those anticipated in such forward-looking statements.

Forward-looking statements are provided herein for the purpose of giving information about IRG's current strategic priorities, expectations and plans, thereby allowing investors and others to get a better understanding of IRGI's business outlook and operating environment. Readers are cautioned, however, that such information may not be appropriate for other purposes and should not place undue reliance on the forward-looking statements contained in this press release. IRG assumes no obligation to update or revise such forward-looking statements to reflect new information, future events or otherwise, except as required by applicable securities laws. Except as otherwise indicated, forward-looking statements do not reflect the potential impact of any non-recurring or other special items or of any transactions that may be announced or that may occur after the date of this press release. The financial impact of these transactions and non-recurring and other special items can be complex and depends on the facts particular to each of them. IRG therefore cannot describe the expected impact in a meaningful way or in the same way it presents known risks affecting the business. IRG's forward-looking statements are expressly qualified in their entirety by this cautionary statement.

SOURCE Imvescor Restaurant Group Inc.