USA: Granite City Food & Brewery Ltd. reported revenue increased 58.3% to $41.3 million for the nine months ended September 26 2006

Granite City Food & Brewery Ltd. (Nasdaq: GCFB) a Modern American upscale casual restaurant chain reported November 08 the results for the fiscal third quarter ended September 26, 2006.

Highlights for the 13 weeks ended September 26, 2006, compared to the 13 weeks ended September 27, 2005, were as follows:

Revenues increased 54.8% to $15.0 million
Comparable restaurant sales increased 3.4%
Restaurant-level EBITDA increased 58.5% to $2.4 million
General and administrative costs decreased to 11.0% from 13.5%
Completed a $16.0 million equipment lease facility

Granite City opened two new restaurants during the third quarter – St. Louis Park, MN and a second Wichita, KS restaurant. Since quarter-end, the Company opened two additional restaurants—one in Omaha, Nebraska on October 17th and one in Roseville, Minneapolis on November 3rd.

Third Quarter Financial Results

Total revenue increased 54.8% to $15.0 million compared to $9.7 million for the third quarter of 2005. Comparable restaurant sales increased 3.4% during the third quarter of 2006 due to increased guest counts as menu prices were unchanged. The net loss was $1.6 million or $(0.12) per share for the third quarter of 2006 compared to a loss of $1.0 million or $(0.09) per share for the third quarter of 2005. The Company recorded non-cash stock compensation expense of approximately $143,000 compared to no non-cash stock compensation expense for the same quarter of 2005 due to the adoption of SFAS No. 123 (Revised) at the beginning of fiscal 2006.

Restaurant-level EBITDA increased 58.5% to $2.4 million for the third quarter of 2006 compared to $1.5 million for the same quarter of 2005. For comparable restaurants, restaurant-level EBITDA was 18.5% for the third quarter of 2006 compared to 18.6% for the third quarter of 2005. For all restaurants, restaurant-level EBITDA was 15.9% for the third quarter of 2006 compared to 15.6% for the same quarter of 2005.

First Nine Months Financial Results

Revenue increased 58.3% to $41.3 million for the nine months ended September 26, 2006 compared to $26.1 million for the same period of 2005. Comparable restaurant sales increased 4.6% as a result of increased guest counts.

The net loss for the nine months ended September 26, 2006 was $3.8 million or $(0.28) per share compared to a net loss of $2.0 million or $(0.17) per share in the prior year period. For the nine months ended September 26, 2006 the Company recorded non-cash stock compensation expense of $550,848 compared to $12,780 for the prior year period as a result of the adoption of SFAS No. 123 (Revised).

“We continued to successfully grow our business as evidenced by the growth in comparable restaurant sales, strong operating results and the expansion of our store base by the two restaurants we opened during the quarter and two more since quarter-end,” said Steven Wagenheim, President and Chief Executive Officer. “Our strong new restaurant performance in new markets demonstrate the strength and popularity of our concept. Our operating and financial infrastructure is strong and capable of supporting our business growth. We are very pleased with our restaurant-level EBITDA margins especially during a quarter that was very difficult for the industry as a whole. We are well positioned for continued growth in 2007 and we are pleased with the progress we are making against our long-term growth targets.”

About Granite City

Granite City Food & Brewery Ltd., is a Modern American upscale casual restaurant chain that operates 17 restaurants in 7 Midwestern states. The menu features affordable yet high quality family favorite menu items prepared from made-from-scratch recipes and served in generous portions. The sophisticated yet unpretentious restaurants, proprietary food and beverage products, attractive price points and high service standards combine for a great dining experience. Granite City opened its first restaurant in St. Cloud, MN in 1999.

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