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Operating efficiencies were gained throughout 2024 as Big Rock continues to focus on its core businesses and streamlining its operations.  The Corporation made the decision to permanently close it's operations in Vancouver and Toronto at the conclusion of their leases.  The Vancouver Brewery and Eatery was closed in 2024 and resulted in a one time charge of $2.8 million for the year.  The Toronto Brewpub lease expires on April 30, 2025 and resulted in the recognition of a non recurring one time impairment of fixed assets of $1.6 million and a contingent loss of $0.2 million.  The rationalization of these operations will improve cash flow in 2025 and allow for a renewed focus in our core sales area.  That said, Big Rock will continue to maintain a presence and its manufacturing license in both British Columbia and Ontario.  Operational efficiencies were gained when Big Rock's warehouse facility located in Edmonton was closed and sold on June 17, 2024 and a partnership developed with a local Edmonton based trucking company who will provide cross docking functionality to serve Big Rocks existing network of customers.  Furthermore, in December 2024, Big Rock entered into 5 year lease on 88,156 square feet of warehouse space which commences on June 1, 2025.  Both initiatives will improve cash flow by reducing third party logistics costs in 2025 and more importantly allow Big Rock to leverage its distribution license.

Lastly, in January of 2025, concurrent with a $9.0 million debt settlement agreement with VN Capital Fund I, LP the Corporation a closed a $8.4 million private placement which resulted in a total of 17.4 million common shares being issued.  Approximately $3.2 million of the cash proceeds will be used to fund strategic capital investments aimed at increasing the capacity and improving the efficiency in the ready-to-drink production platform, with the residual being used to deleverage the balance sheet.  More specifically, $11.3 million or all indebtedness and liabilities owing to VN Capital have been settled (inclusive of the aforementioned $9.0 million) and $0.7 million was used to repay existing term loans.  The recapitalization of the balance sheet was critical as it as it gives the Corporation to ability to act on opportunities to improve operating efficiencies while providing the liquidity to weather the current macro economic uncertainties.  The recapitalization also marks the end of what we believe the transition period is as we move into a period of positive EBITDA and cash flow.

On December 30, 2024, the Corporation was not compliant with its fixed charge coverage ratio.  In January 2025, the ATB provided a commitment letter which provided a waiver for this covenant for the fiscal 2024 year end.  Had this been obtained on or before December 30, 2024 $9.0 million in ATB debt would have been classified as non current as opposed to current on the balance sheet.  As this issue was resolved in January 2025, the classification of ATB debt will revert to being classified as non current in the first quarter of 2025.

"We are proud of the progress Big Rock has made during this period of transition," noted President and Chief Executive Officer David Kinder. "In the fourth quarter of 2024, we began production under our new multi-year co-packing agreements, driving a 38% increase in sales volumes compared to the same period in 2023. We are excited to continue investing in our own brands to align with consumer demand, focus on product innovation, and expand our Ready-to-Drink ("RTD") production capabilities alongside our co-packing partners and Big Rock labels. Despite increased sales volumes, Q4 remained part of our transition period, as we had yet to fully realize the benefits of our recently implemented efficiencies and accordingly we continued to incur expenditures with our third-party providers of these services. Looking ahead into 2025, these costs are anticipated to be wholly avoided as we fully leverage our new logistics and production capabilities which will help to contribute to a return to positive EBITDA in 2025. I am incredibly proud of our team's dedication, which has set the stage for continued growth and success.

While we remain optimistic about our path forward, we recognize ongoing economic uncertainty, including the threat of tariffs on aluminum and other materials, as well as recent changes to the Alberta mark-up rate on alcohol sales. We are actively monitoring these risks and working to mitigate their impact, including engaging with policymakers and carefully reviewing our procurement strategies."

Summary of Results

    ⁽¹⁾     Non-GAAP measure. See "Non-GAAP Measures".

Additional Information

The audited consolidated financial statements and Management's Discussion and Analysis for the year ended December 30, 2024 dated March 20, 2025, can be viewed on Big Rock's website at www.bigrockbeer.com and on SEDAR+ at www.sedarplus.ca under Big Rock Brewery Inc.

Big Rock is also pleased to announce that the annual meeting of Big Rock shareholders is expected to be held on May 14, 2025 at 2:00 p.m. (Mountain Standard Time). Further details of the meeting will follow in due course.

NON-GAAP MEASURES

The Corporation uses certain financial measures referred to in this press release to quantify its results that are not prescribed by Generally Accepted Accounting Principles ("GAAP").  Such financial measures do not have a standardized meaning under GAAP and therefore may not be comparable to similar measures presented by other issuers.

This press release contains the term "Adjusted EBITDA". Adjusted EBITDA is a non-GAAP financial measure that the Corporation uses to measure operating performance and borrowing capacity. The calculation of Adjusted EBITDA is a non-GAAP financial measure, whose nearest GAAP measure is net income, or net loss, as applicable, with the reconciliation between the two as follows:

⁽¹⁾   Non-GAAP measure.  See "Non-GAAP Measures".

Adjusted EBITDA in the three months ended December 30, 2024 decreased by $1.2 million in comparison to the corresponding period in the prior year. The decreased Adjusted EBITDA is primarily attributable to increased production costs and product mix variances.

Forward-Looking Information

Certain statements contained in this press release constitute forward-looking statements. These statements relate to future events or Big Rock's future performance. All statements, other than statements of historical fact, may be forward-looking statements. Forward-looking information are not facts, but only predictions and generally can be identified by the use of statements that include words or phrases such as, "anticipate", "believe", "continue", "could", "estimate", "expect", "intend", "likely" "may", "project", "predict", "propose", "potential", "might", "plan", "seek", "should", "targeting", "will", and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Big Rock believes that the expectations reflected in those forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon by readers, as actual results may vary materially from such forward-looking statements. These statements speak only as of the date of this press release and are expressly qualified, in their entirety, by this cautionary statement.

In particular, this press release contains forward-looking statements pertaining to the following:

• Big Rock's long-term growth strategy and the anticipated benefits to be derived therefrom;

• Big Rock's business plans, outlook, and strategy;

• Big Rock's expectation that it will continue to invest in its own brands to align with consumer demand, focus on product innovation, and expand its RTD production capabilities alongside its co-packing partners and Big Rock labels;

• Big Rock's belief that it has not yet to fully realized the benefits of its recently implemented efficiencies;

• Big Rock's expectations with respect to 2025 costs, including that such are anticipated to decrease as Big Rock leverages its new logistics and production capabilities and Big Rock's belief that such will contribute to a return to positive EBITDA in 2025;

• Big Rock's beliefs and expectations regarding its path forward, including that it is actively monitoring risks related to the threat of tariffs on aluminum and other materials, as well as recent changes to the Alberta mark-up rate on alcohol sales, and that it is working to mitigate their impact, including engaging with policymakers and carefully reviewing its procurement strategies; and

• the anticipated date and timing of Big Rock's annual meeting of shareholders and Big Rock's expectation that further details in connection therewith will follow in due course.

With respect to the forward-looking statements listed above and contained in this press release, management has made assumptions regarding, among other things:

• volumes in the current fiscal year will remain constant or will increase;

• there will be no material change to the regulatory environment in which Big Rock operates;

• there will be no material supply issues with Big Rock's vendors;

• seasonal fluctuations in demand; and

• the potential scope and duration of tariffs, export taxes, export restrictions or other trade actions; and

• the benefits to be derived from Big Rock's new logistics and production capabilities, including that such will contribute to a return to positive EBITDA in 2025.

Some of the risks which could affect future results and could cause results to differ materially from those expressed in the forward-looking information and statements contained herein include the risk factors set out in the Corporation's annual information form for the year ended December 30, 2023 which is available on SEDAR+ at www.sedarplus.ca and also include, but are not limited to:

• risks related to Big Rock's credit facility with ATB and the Second Lien Financing;

• the inability to grow demand for Big Rock's products;

• the risk that Big Rock may not have an increase in market demand or market share;

• the risk that Big Rock may not realize the benefits of increased co-packing production;

• the risk that continued attention to streamlining production and maximizing return on sales and marketing initiatives for Big Rock's branded, white-label and co-packing businesses, won't help the Corporation continue to improve its financial results and strengthen its balance sheet;

• the risk that Big Rock may not realize operational efficiencies or margin growth;

• the risk that Big Rock may not have sufficient cash flows to cover forecasted expenses or return to profitability; and

• the risk that Big Rock may not be in compliance with its financial covenants for the next 12 months.

Any financial outlook or future oriented financial information (in each case "FOFI") contained in this press release regarding prospective financial position, including, but not limited to: expectations regarding continued improvement in Big Rock's financial results and the anticipated benefits to be derived therefrom and  Big Rock's long-term growth strategy and the anticipated benefits to be derived therefrom are based on reasonable assumptions about future events, including those described above, based on an assessment by management of the relevant information that is currently available. The actual results will likely vary from the amounts set forth herein and such variations may be material. Readers are cautioned that any such FOFI contained herein should not be used for purposes other than those for which it is disclosed herein. Such information was made as of the date of this press release and the Corporation disclaims any intention or obligation to update or revise any such information, whether as a result of new information, future events, or otherwise, unless required pursuant to applicable law.

Readers are cautioned that the foregoing list of assumptions and risk factors is not exhaustive. The forward-looking information and statements and FOFI contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking information and statements and FOFI included in this press release are made as of the date hereof and Big Rock does not undertake any obligation to publicly update such forward-looking information and statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.

About Big Rock Brewery Inc.

In 1985, Ed McNally founded Big Rock to contest the time's beer trends. Three bold, European-inspired offerings – Bitter, Porter and Traditional Ale – forged an industry at a time heavy on easy drinking lagers and light on flavour. Today, our extensive portfolio of signature beers, ongoing seasonal offerings, six ciders (Rock Creek Cider® series), custom-crafted private label products and other notable, licensed alcoholic beverages keeps us at the forefront of the craft beer revolution and still proudly contesting the beer and alcoholic beverage trends of today. Big Rock has brewing operations in Calgary, Alberta, Vancouver, British Columbia, and Toronto, Ontario. Big Rock trades on the TSX under the symbol "BR". For more information on Big Rock visit www.bigrockbeer.com

SOURCE Big Rock Brewery Inc.

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