BRAZIL: Brazil Fast Food reports strongly improved 4th quarter and yearly results; reports net operating profit

Brazil Fast Food Corp. (NASDAQ SmallCap: BOBS), the second largest fast-food chain operator in Brazil, with 231 points of sale, today reported operating results for its fourth quarter and year ended December 31, 2000.

System-wide gross sales for the chain increased 22.7 percent to R$44.9 million for the fourth quarter of 2000, from R$36.5 million for the same period of the prior year. Same store sales were up 2.8 percent for the fourth quarter of 2000 compared with the previous year’s fourth quarter. Total net operating revenue for the fourth quarter of 2000 rose more than 20 percent to R$21.0 million, from R$17.4 million for the same period of the prior year. EBITDA (earnings before interest, taxes, depreciation and amortization) were R$1.6 million for the three months ended December 31, 2000, versus R$85,000 for the fourth quarter of the previous year. The Company’s net loss was R$(1.1) million, or R$(0.34) per basic common share, for the fourth quarter of 2000, compared with a net loss of R$(4.4) million, or R$(1.36) per basic common share, for the fourth quarter of 1999. The breakdown of the net loss for the fourth quarter of 2000 and 1999, respectively, is as follows: Income from operations – R$686,000 versus a loss of R$(1.0) million; interest expense – R$(1.5) million versus R$(2.1) million; and foreign exchange loss – R$(278,000) versus R$(1.3) million.

Total net operating revenue for 2000 increased 15.1 percent to R$71.8 million from R$62.4 million for the prior year. EBITDA for 2000 were R$4.1 million versus R$1.1 million for 1999 – a four-fold increase. System-wide gross sales for the chain increased 22.8 percent to R$155.1 million for 2000 from R$126.3 million for the previous year. Same store sales for 2000 increased 8.0 percent from the prior year. The Company reported a net operating profit of R$490,000 for 2000 – an improvement of R$2.9 million from the R$(2.4) million net operating loss of for 1999. The net loss for 2000 was R$(3.4) million, or R$(1.04) per basic and diluted common share, compared to R$(10.9) million, or R$(3.37) per basic and diluted common share for 1999.

Brazil Fast Food also announced that it has completed a private placement offering of 487,500 units at $4.00 per unit, each consisting of one share of common stock and a warrant, exercisable for 24 months at $5.00 per share. This equity placement, together with negotiated adjustments to certain supplier agreements, yielded an aggregate of $2.9 million, which will be used for working capital.

Peter van Voorst Vader, president and CEO of Brazil Fast Food Corp., commented, “I am very proud of our Company’s progress during 2000. Our aggressive growth and expansion strategy, successful new product and marketing initiatives, strict cost-control measures and a stronger economic environment in Brazil enabled us to expand our chain, boost sales, greatly improve EBITDA and slash our net loss. We anticipate continuing this progress throughout 2001 as we expand – principally through franchises – to an expected 270 points of sale by the end of the year. As always, our work will be equally divided between satisfying our customers’ taste for great fast food and our investors’ desire for profits.”

About Brazil Fast Food

Brazil Fast Food currently has 231 points of sale in its chain. Brazil Fast Food Corp., through its wholly owned subsidiary, Venbo Comercio de Alimentos Ltda., a limited liability company that conducts business under the trade name “Bob’s,” owns and operates (both directly and through franchisees) the
second largest chain of hamburger fast food restaurants in Brazil.

Operating highlights for 2000 include:

• Opening of 200th Bob’s restaurant
  
• Agreement with Petrobras Distribuidora (BR), the largest gas station chain in Brazil, and subsidiary of Petrobras S.A., South America’s leading oil company. Under terms of the agreement, Brazil Fast Food committed to opening a store-within-a-store in BR Mania convenience stores or stand-alone drive-thru restaurants at 30 Petrobras gas stations located predominantly in Rio de Janeiro and São Paulo. In addition, Brazil Fast Food and BR agreed to study the possible expansion of the agreement to additional gas stations in Brazil operated by BR.
  
• Brazil Fast Food began offering Brazilian Depository Receipts (BDRs) on the BOVESPA, the Brazilian stock exchange in São Paulo.
  
• Initiation of a test program in 16 Bob’s restaurants in Rio de Janeiro, which enables customers to place food-delivery orders via the Internet.
  
• Master-franchise agreement to open 30 stores in Portugal, the first of which will be opened during the last quarter of 2001.

The accompanying financial information has been prepared assuming that Brazil Fast Food will continue as a going concern. The Company has suffered recurring losses from operations and has a negative working capital that raises substantial doubt about its ability to continue as a going concern.
Management’s plans in relation to these matters are described in the Company’s Form 10-K for the year ended December 31, 2000.

This press release may contain certain forward-looking statements, which are subject to change. Actual results may differ from those described in any forward-looking statements. Additional information concerning potential factors that could affect the Company’s financial results are included in the Company’s Form 10-K for the year ended December 31, 2000.

BRAZIL FAST FOOD CORP.
Financial Highlights (Audited)1
(In thousands, except shares and earnings per share)

1. Expressed in Brazilian Reais.
2. Earnings before interest, taxes, depreciation and amortization.

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