Birks Group reports mid-year results during a transformational period for the company

MONTREAL, Nov. 16, 2017

Jean-Christophe Bédos, President and Chief Executive Officer of Birks Group, commented: "The sale of Mayors and our results for the half-year reflect the transformation of the Company's operations in order to achieve its objective of becoming an international omni-channel business and to attain our goal of becoming a globally renowned luxury brand. The major renovations at our two flagship locations in Montreal and Toronto coupled with a soft Canadian retail environment affected our results for the first half of the year. The sale of Mayors on October 23, 2017 for total cash consideration of $107.7 million, subject to customary post-closing adjustments, allowed us to substantially reduce our debt. In addition, this allows us to focus on the execution of our short-term and long-term strategies, namely the renovations of our flagship stores, the global expansion of the Birks product brand, the implementation of our new store concept and the development of our wholesale and e-commerce businesses. Our omni-channel approach, as well as our creative marketing campaigns will allow us to achieve the Company's sales growth and profitability objectives as well as long-term shareholder value."

For the twenty-six week period ended September 23, 2017 compared to the twenty-six week period ended September 24, 2016 - from continuing operations:

• Net sales from continuing operations for the twenty-six week period ended September 23, 2017 declined by $5.1 million to $49.8 million from the twenty-six week period ended September 23, 2017, compared to $54.9 million in the twenty-six week period ended September 24, 2016.  The decrease in net sales was reflective of a 10% decline in comparable store sales on a constant exchange rate basis (see "Non-GAAP measures") related to a decrease in sales of third party branded fine jewelry and bridal offerings. This decline in comparable store sales was driven by a decrease in traffic and transaction volume caused primarily by a softening of luxury retail conditions across Canada and an overall softening of retail conditions in the 2017 summer period, as well as to the fact that, as part of the Company's strategic plan, the Company began renovations affecting two of its flagship stores (Montreal and Toronto) that led to a temporary decline in sales volume during the construction period;
• Gross profit from continuing operations was $20.0 million, or 40.1% of net sales, during the twenty-six week period ended September 23, 2017, compared to $22.5 million, or 41.0% of net sales, during the comparable prior fiscal year period. The 90 basis point gross margin rate decrease was primarily attributable to product sales mix and increased sales promotions;
• Operating expenses from continuing operations, excluding depreciation, for the period increased by $0.3 million mainly due to increased marketing and operational costs related to the Company's strategic focus on the promotion and development of the Birks product brand; and
• The Company incurred a net loss of $4.3 million, or $0.24 per share, for the 26 week period ended September 23, 2017, comprised of a net loss from continuing operations of $5.7 million, or $0.32 per share and a net income from discontinued operations of $1.3 million, or  $0.08 per share, compared to a net loss of $2.0 million, or $0.11 per share for the 26 week period ended September 24, 2016, comprised of a net loss from continuing operations of $4.0 million, or $0.22 per share and a net income of $2.0 million, or $0.11 per share.

About Birks Group Inc.

Birks Group is a leading designer of fine jewelry, timepieces and gifts and operator of luxury jewelry stores in Canada. The Company operates 28 stores under the Birks brand in most major metropolitan markets in Canada and two retail locations in Calgary and Vancouver under the Brinkhaus brand. Birks was founded in 1879 and has become Canada's premier retailer and designer of fine jewelry, timepieces and gifts. Additional information can be found on Birks' web site, www.birksgroup.com.

Non-GAAP Measures

The Company reports information in accordance with U.S. Generally Accepted Accounting Principles ("U.S. GAAP"). The Company's performance is monitored and evaluated using various sales and earnings measures that are adjusted to include or exclude amounts from the most directly comparable GAAP measure ("non-GAAP measures"). The Company presents such non-GAAP measures in reporting its financial results to investors and other external stakeholders to provide them with useful complimentary information which will allow them to evaluate the Company's operating results using the same financial measures and metrics used by the Company in evaluating performance. The Company does not, nor does it suggest that investors and other external stakeholders should, consider non-GAAP measures in isolation from, or as a substitute for, financial information prepared in accordance with U.S. GAAP. These non-GAAP measures may not be comparable to similarly-titled measures presented by other companies.