Crumbs Bake Shop Reports Third Quarter 2011 Financial Results

Non-GAAP Information

The Company is providing Adjusted EBITDA information, which is defined as net income of the combined company, including net income attributable to any non-controlling interest, determined in accordance with all applicable and effective GAAP pronouncements up to September 30, 2011, before interest income or expense, income taxes and any gains or losses resulting from the change in estimate relating to the Tax Receivable Agreement, depreciation, amortization, deferred rent expense, losses or gains resulting from adjustments to the fair value of the contingent consideration, stock-based compensation expense, extraordinary or non-recurring expenses and all other extraordinary non-cash items for the applicable period as a compliment to U.S. generally accepted accounting principles (GAAP) results. Adjusted EBITDA measures are commonly used by management and investors as a measure of leverage capacity, debt service ability and liquidity. Adjusted EBITDA is not considered a measure of financial performance under GAAP, and the items excluded from Adjusted EBITDA are significant components in understanding and assessing our financial performance. Adjusted EBITDA should not be considered in isolation or as an alternative to, or superior to, such GAAP measures as net income, cash flows provided by or used in operating, investing or financing activities or other financial statement data presented in our consolidated financial statements as an indicator of financial performance or liquidity. Reconciliations of non-GAAP financial measures are provided in the accompanying tables. Since Adjusted EBITDA is not a measure determined in accordance with GAAP and is susceptible to varying calculations, Adjusted EBITDA, as presented, may not be comparable to other similarly titled measures of other companies.

CRUMBS BAKE SHOP, INC. AND SUBSIDIARIES
(Formerly Known As 57th Street General Acquisition Corp.)
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except per share data)
		Three Months Ended September 30,									Nine Months Ended September 30,
		2011				2010					2011				2010
Net sales		$	8,876			$	7,506				$	28,889			$	22,546
Cost of sales			3,768				3,062					12,194				9,212
Gross profit			5,108				4,444					16,695				13,334
Operating expenses
Selling expenses			283				239					1,010				818
Staff expenses			3,101				2,082					9,209				5,982
Occupancy expenses			1,827				1,240					5,192				3,504
General and administrative			660				349					1,682				935
New store expenses			419				171					533				351
Depreciation and amortization			362				213					1,037				614
			6,652				4,294					18,663				12,204
Income (loss) from operations			(1,544	)			150					(1,968	)			1,130
Other income (expense)
Interest and other income			-				-					-				-
Abandoned lease projects			(6	)			(190	)				(20	)			(198	)
			(6	)			(190	)				(20	)			(198	)
Income (loss) before income taxes			(1,550	)			(40	)				(1,988	)			932
Income taxes			11				-					11				-
Net income (loss) attributable to the controlling and non-controlling interests			(1,561	)			(40	)				(1,999	)			932
Less: Net (income) loss attributable to non-controlling interest			647				-					829				-
Net income (loss) attributable to stockholders		$	(914	)		$	(40	)			$	(1,170	)		$	932
Net income (loss) per common share, basic and diluted		$	(0.17	)		$	(0.01	)			$	(0.21	)		$	0.29
Weighted average number of common shares outstanding, basic and diluted			5,506				6,063		*			5,568				3,177		*
* The weighted average number of common shares outstanding is that of Crumbs Bake Shop, Inc.

CRUMBS BAKE SHOP, INC. AND SUBSIDIARIES
(Formerly Known As 57th Street General Acquisition Corp.)
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS
(in thousands, except per share data)
			September 30,				December 31,
			2011				2010
			(Unaudited)				(Audited)
ASSETS
Current assets
Cash		$	8,628			$	655
Trade receivables			331				248
Inventories			366				241
Prepaid rent			577				387
Deferred financing costs			-				215
Other current assets			350				82
Total current assets			10,252				1,828
Property and equipment, net			11,287				8,784
Other Assets
Deferred tax asset			4,774				-
Restricted certificate of deposit			673				30
Intangible assets, net			383				429
Deposits			287				277
Other			93				36
Total other assets			6,210				772
		$	27,749			$	11,384
LIABILITIES, MEMBERS' EQUITY AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses		$	1,726			$	2,616
Payroll liabilities			391				141
Sales tax payable			70				48
Gift cards and certificates outstanding			124				120
Total current liabilities			2,311				2,925
Long-term liabilities
Deferred rent			2,666				1,863
Payable to related parties pursuant to tax receivable agreement			2,387				-
Total liabilities			7,364				4,788
Members' equity			-				6,596
Stockholders' equity
Preferred stock, $.0001 par value; 1,000 shares authorized;
390 shares issued and outstanding at September 30, 2011			-				-
Common stock, $.0001 par value; 100,000 shares authorized;
7,100 shares issued, 5,506 outstanding at September 30, 2011			-				-
Additional paid-in capital			30,255				-
Accumulated deficit			(1,764	)			-
Treasury stock, at cost			(15,914	)			-
Total Crumbs Bake Shop, Inc. stockholders' equity			12,577				-
Non-controlling interest			7,808				-
Total stockholders' equity			20,385				-
		$	27,749			$	11,384

CRUMBS BAKE SHOP, INC. AND SUBSIDIARIES
(Formerly Known As 57th Street General Acquisition Corp.)
ADJUSTED EBITDA AS DEFINED BY AMENDMENT NO. 3 TO THE
BUSINESS COMBINATION AGREEMENT DATED APRIL 7, 2011
(UNAUDITED AND IN THOUSANDS)
			Three Months Ended September 30									Nine Months Ended September 30
			2011				2010					2011			2010
Net income (loss) attributed to the controlling
and non-controlling interest		$	(1,560	)		$	(39	)			$	(1,988	)		$	931
Depreciation			328				184					936				527
Amortization			34				29					101				87
Abandoned Lease Costs			6				189					20				198
Deferred Rent Expense			413				163					671				373
Non-recurring expenses			51				0					149				0
Adjusted EBITDA		$	(728	)		$	526				$	(111	)		$	2,116

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