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SPOT COFFEE LTD. designs, builds and operates community-oriented cafes that provide its customers from every lifestyle and culture with the highest quality service, signature light meals and roasted in-house gourmet coffee.

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Spot Coffee Second Quarter 2013 Financial Results & Operations

TORONTO, ONTARIO--(Marketwired - Aug. 29, 2013) - SPOT COFFEE (CANADA) LTD. (TSX VENTURE:SPP) ("SPoT" or the "Company") released its financial results for the Company's three and six months ended June 30, 2013. Complete interim financial statements and Management's Discussion and Analysis have been filed for public review at www.sedar.com and are available on the Company's website at www.spotcoffee.com. All dollar values expressed in Canadian dollars unless otherwise stated.

Second Quarter 2013 Financial Highlights

--  20% increase in Revenue
    Reported revenue increased 20% to $2,107,968 for the second quarter of
    2013 from $1,752,947 for the same quarter of 2012.

--  17% increase in System-wide Sales
    System-wide sales revenue (include licensed cafe) increased 17% to
    $2,333,256 for the second quarter of 2013 from $1,991,520 for the same
    quarter of 2012.

--  25% increase in Gross Profit
    Gross profit increased 25% to $1,420,477 for the second quarter of 2013
    from $1,137,926 for the same quarter of 2012. SPoT's gross margin
    percentage increased to 67% of revenue for the second quarter of 2013
    from 65% for the same quarter of 2012.

--  33% COGS
    Cost of sales was $687,491 and represents 33% of revenue for the second
    quarter of 2013. It's in- line with the increased sales and higher gross
    margins.

--  Positive Cafe-level EBITDA
    On a cash basis, SPoT achieved positive Cafe-level EBITDA of $304,544
    for the second quarter of 2013, represents a significant increase
    compared to a negative EBITDA of $11,007 for the same quarter of 2012.
    The Company reported consolidated net loss of $784,697 for the second
    quarter of 2013. Other than non-cash expenses of $208,690, the key
    driver behind the net loss during the second quarter is a $530,809 non-
    cash charge for the write-off of the carrying value of leasehold
    improvements due to the discontinued operations of the non-performing
    Spot Park Place cafe and the termination of its lease.

--  25% increase in Commercial Accounts Sales
    Commercial accounts sales increased 25% to $57,470 for the second
    quarter of 2013 from $46,037 for the same quarter of 2012.

In May of 2013, the Company discontinued operations at the SPoT Park Place cafe. Upon extensive review of the cafe's performance by SPoT's management, it was determined that slower than anticipated condominium development in the surrounding community and the corresponding lack of a critical mass of residents necessitated the closure of that location. As a result of the termination of leased space for Spot Park Place cafe, the company took a non-cash charge of $530,809 for the write-off of the carrying value of leasehold improvements for the three months ended June 30, 2013. The net loss of $501,951 is included in the consolidated statements of operations and comprehensive loss for the three months ended June 30, 2013.

SPoT Will Benefit From the Following Key Factors For the Remainder Of 2013
1.  Increasing gross margins
2.  Escalating purchasing power
3.  Major sales and distribution agreement with American Natural
4.  Ongoing realization of monthly fixed operational cost savings of $20,000
5.  Benefit of full year of operation for SPoT Hertel, SPoT Transit and SPoT
    Saratoga Springs
6.  Expansion of coffee roasting operations

"We are extremely pleased with the position of Company at this time. We have successfully begun our first sales and distribution agreement and have closed a highly unprofitable cafe location," said Mr. Anton Ayoub, President of SPoT Coffee, commenting on the Company's operations. "The systems and cost saving measures implemented over the last several quarters can now be seen positively impacting gross margins and lowering fixed cost at the head office level. I believe that these savings will continue in perpetuity, allowing the Company to realize profitability at the corporate level."

About SPoT Coffee

SPoT Coffee trades on the TSX Venture Exchange under the symbol SPP. SPoT designs, builds and operates community oriented cafes that provide its customers with the highest quality service, signature made-to-order meals and the world's finest in-house roasted gourmet coffee. Each SPoT cafe is distinctively designed to suit their local neighbourhoods, creating warm and friendly gathering places for the community. SPoT's commercial business focuses on retail stores, business accounts and third party resellers such as universities and hospitals.

Forward-Looking Statements

Except for statements of historical fact relating to the Corporation, certain information contained herein constitutes forward-looking statements. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Except as required by applicable securities requirements, the Corporation undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of the release.

FOR FURTHER INFORMATION PLEASE CONTACT:
SPoT Coffee
David Freeman
		Corporate Development & Shareholder Communications
(416) 368-2220
[email protected]


SPoT Coffee
Anton Ayoub
CEO
(416) 368-2220
[email protected]

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