Centerplate (CVP) 8-K Centerplate Reports Growth In Sales and Ebitda for First Quarter 2006

CENTERPLATE REPORTS GROWTH IN SALES AND EBITDA
FOR FIRST QUARTER 2006

SPARTANBURG, S.C., XX, 2006 — Centerplate, Inc. (AMEX: CVP; TSX: CVP.un), today reported financial results for the first quarter ended April 4, 2006. Net sales increased by $6.3 million, or almost 6%, to $113.5 million, compared to net sales of $107.2 million for the first quarter of 2005. Adjusted earnings before interest, income taxes, depreciation and amortization (EBITDA) for the first quarter were $3.5 million, compared to $2.5 million in the first quarter of 2005.

Net sales for the first quarter 2006 increased primarily due to higher sales at the company’s convention centers and arenas ($7.1 million and $6.5 million, respectively). The improvement at convention centers was partially due to an increase in the number of events. Increases at the company’s arenas stemmed from the resolution of the National Hockey League (NHL) lock-out and the Atlantic Coast Conference (ACC) and National Collegiate Athletic Association (NCAA) basketball tournaments held in a number of the company’s facilities. Partially offsetting these improvements was a decline in sales of $5.6 million at the company’s National Football League (NFL) facilities. Four fewer NFL games were played in the first quarter of 2006, compared to the first quarter of 2005, because of variations in NFL schedules. In addition, the Louisiana Superdome was closed and the New Orleans Arena was open on a limited basis in the wake of Hurricane Katrina, causing a $3.5 million decline in sales.

“We are very pleased with our first quarter results,” said Janet L. Steinmayer, President and Chief Executive Officer of Centerplate. She added, “Our focus in 2006 is to continue to execute on our strategic initiatives — Culinary Excellence, Branded Concepts, Speed of Service and Design — while keeping our overhead expenses flat as compared to last year. This quarter’s strong results demonstrate that we are on the right track.”

The company reported a net loss of $5.6 million, or $0.25 per share, compared to a net loss of $4.4 million, or $0.20 per share, in the first quarter of 2005. The increased loss was primarily due to higher interest expense under the April 1, 2005 credit agreement.

As previously announced, Centerplate will make its 29^th monthly distribution to IDS holders on May 19, 2006 at the anticipated annual rate of approximately $1.56 per IDS.

Centerplate will discuss its first quarter 2006 financial results on a conference call today, Wednesday, May 3 at 5:30 p.m. eastern daylight time. Interested parties may participate in the call by dialing 877-407-8029 approximately 10 minutes before the call is scheduled to begin. International callers should dial 201-689-8029. An audio webcast of the conference call can also be accessed via www.centerplate.com. For individuals unable to participate in the conference call, a telephone replay will be available from 8:00 p.m. on May 3, 2006 through midnight on May 23, 2006. The replay can be accessed domestically by dialing 877-660-6853. For international callers, the dial-in number is 201-612-7415. The replay account number for the call is 252 and the pass code is 200526.

About Centerplate

Centerplate is a leading provider of food and related services, including concessions, catering, merchandise and facility management services, at sports facilities, convention centers and other entertainment venues. Visit the company online atwww.centerplate.com.

Presentation of Information in this Press Release

Centerplate presents adjusted EBITDA because covenants in the indenture governing the company’s subordinated notes contain ratios based on this measure. A reconciliation of adjusted EBITDA to net income or loss is included in the attached tables.

Forward-Looking Statements

The information contained in this news release, other than historical information, includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. These statements may involve risks and uncertainties that could cause actual results to differ materially from those described in such statements. Although Centerplate believes that the expectations reflected in such forward-looking statements are reasonable, the company can give no assurance that such expectations will prove to have been correct or that they will occur. Important factors beyond Centerplate’s control, including general economic conditions, consumer spending levels, changing trends in our business and competitive environment, adverse weather conditions and other factors, as well as the risks identified in the prospectus, relating to the offering of IDSs, and our most recent annual report on Form 10-K could cause actual results to differ materially from Centerplate’s expectations. Centerplate undertakes no obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Contact Information

Gael Doar
Director of Communications
203-975-5941
gael.doar@centerplate.com

(Financial Tables Follow)

CENTERPLATE, INC.
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)

	Thirteen Weeks Ended
	April 4,			March 29,
	2006			2005
	(In thousands, except share data)
Net sales	$	113,505		$	107,220
Cost of sales		95,660			89,031
Selling, general and administrative expense		14,683			15,766
Depreciation and amortization		7,051			6,805
Contract related losses		100			—
Operating loss		(3,989	)		(4,382	)
Interest expense, net		6,539			5,400
Other income, net		(322	)		(86	)
Loss before income taxes		(10,206	)		(9,696	)
Income tax benefit		(4,608	)		(5,263	)
Net loss	$	(5,598	)	$	(4,433	)
Basic and Diluted Net Loss per share with and without conversion option	$	(0.25	)	$	(0.20	)
Weighted average shares outstanding with conversion option		4,060,997			4,060,997
Weighted average shares outstanding without conversion option		18,463,995			18,463,995
Total weighted average shares outstanding		22,524,992			22,524,992
Dividends declared per share	$	0.20		$	0.20

CENTERPLATE, INC.
RECONCILIATION OF NET LOSS TO ADJUSTED EARNINGS BEFORE INTEREST,
INCOME TAXES, DEPRECIATION, AND AMORTIZATION (UNAUDITED)

	Thirteen Weeks Ended
	April 4,			March 29,
	2006			2005
	(In thousands)
Net loss	$	(5,598	)	$	(4,433	)
Income tax benefit		(4,608	)		(5,263	)
Loss before income taxes		(10,206	)		(9,696	)
Adjustments:
Interest expense		6,539			5,400
Depreciation and amortization		7,051			6,805
EBITDA (1)	$	3,384		$	2,509
The following adjustments to EBITDA were made to compute Adjusted EBITDA:
EBITDA	$	3,384		$	2,509
Adjustments:
Contract related losses (2)		100			—
Adjusted EBITDA (1)	$	3,484		$	2,509

(1)

EBITDA is not a measure in accordance with GAAP. EBITDA is not intended to represent cash flows from operations as determined by GAAP and should not be used as an alternative to income (loss) before taxes or net income (loss) as an indicator of operating performance or to cash flows as a measure of liquidity. We believe that EBITDA is an important measure of the cash returned on our investment in capital expenditures under our contracts. Adjusted EBITDA as defined in the indenture governing our subordinated notes issued in 2003, is determined as EBITDA as adjusted for transaction related expenses, contract related losses, other non-cash charges, and the former annual management fee paid to affiliates of Blackstone and GE Capital, less any non-cash credits. We present Adjusted EBITDA because covenants in the indenture governing our 2003 notes contain ratios based on this measure and it is used by management to among other things evaluate our ability to make interest and dividend payments.

(2)

Reflects non-cash expense for the write-off of contract rights associated with a terminated contract.

CENTERPLATE, INC.
SELECTED CONSOLIDATED CASH FLOW DATA (UNAUDITED)

	Thirteen Weeks Ended
	April 4,			March 29,
	2006			2005
	(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(5,598	)	$	(4,433	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		7,051			6,805
Amortization of deferred financing costs		643			382
Contract related losses		100			—
Noncash interest earned on restricted cash		(94	)		—
Derivative noncash interest		(398	)		(105	)
Deferred tax change		(4,692	)		(5,263	)
Loss on disposition of assets		(13	)		(1	)
Other		5			(67	)
Changes in assets and liabilities		1,434			(739	)
Net cash used in operating activities		(1,562	)		(3,421	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(1,235	)		(3,532	)
Proceeds from sale of property and equipment		17			329
Contract rights acquired		(3,218	)		(4,644	)
Restricted cash		—			(180	)
Net cash used in investing activities		(4,436	)		(8,027	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings — revolving loans		1,000			18,750
Principal payments on long-term debt		(269	)		—
Payments of financing costs		—			(791	)
Dividend payments		(4,460	)		(4,460	)
Decrease in bank overdrafts		(234	)		(1,693	)
Net cash provided by (used in) financing activities		(3,963	)		11,806
INCREASE (DECREASE) IN CASH		(9,961	)		358
CASH AND CASH EQUIVALENTS:
Beginning of period		41,410			24,777
End of period	$	31,449		$	25,135

CENTERPLATE, INC.
SELECTED CONSOLIDATED BALANCE SHEET DATA (UNAUDITED)

	April 4,		January 3,
	2006		2006
	(In thousands)
ASSETS
Current assets	$	85,109	$	88,790
Property and equipment, net		47,646		49,725
Contract rights, net		79,776		80,557
Cost in excess of net assets acquired		41,142		41,142
Deferred financing costs, net		14,856		15,499
Other assets		47,689		42,312
TOTAL ASSETS	$	316,218	$	318,025
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities	$	79,023	$	70,822
Long-term debt		210,595		210,864
Other liabilities		6,698		6,384
Common Stock with conversion option, par value $0.01, exchangeable for subordinated debt, net of discount		14,352		14,352
Total stockholders’ equity		5,550		15,603
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	316,218	$	318,025