Diamond Estates

Wines & Spirits Inc.

F2018 Annual General

& Special Meeting

Ready, Set, Grow

Annual Meeting

September 27, 2018

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Important Notice

This presentation contains forward-looking statements, which can be identified by the use of the forward-looking

terminology, such as but not limited to “may,” “intend,” “will,” “expect,” “anticipate,” “estimate,” “seek,” or “continue”

or the negative thereof or other variations thereon or comparable terminology.

In particular, any statements, express or implied, concerning trends, future operating results, growth, performance,

business prospects and opportunities or the ability to generate revenues, income or cash flow are forward-looking

statements. These statements reflect management’s current beliefs, including beliefs as to future financial and

operating results, and they are based on information currently available to management. Forward-looking

statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable

by management, are inherently subject to known and unknown risks and uncertainties. Such risks include but are

not limited to: the impact of general economic conditions, market volatility, fluctuations in costs, and changes to the

competitive environment, as well as other risks disclosed in the public filings of Diamond Estates Wines & Spirits

Inc. (“Diamond Estates”) publicly filed press releases and sedar filings which can be found at www.sedar.com

These factors should be considered carefully and undue reliance should not be placed on forward-looking

statements. Although the forward-looking statements are based upon what management believes to be reasonable

estimates and assumptions, Diamond Estates cannot ensure that actual results will not be materially different from

those expressed or implied by these forward-looking statements.

Unless specifically required by law, Diamond Estates does not assume any obligation to update or revise these

forward-looking statements to reflect new events or circumstances. Diamond Estates seeks safe harbour.

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Risk Factors

The following risk factors should be carefully considered in evaluating an investment in Diamond Estates. The risks presented below may not be

all of the risks that Diamond Estates may face. It is believed that these are the factors that could cause actual results to be different from

expected and historical results. New risks may emerge and management may not be able to predict all of them, or be able to predict how they

may cause actual results to be different from those contained in any forward-looking statements:

➢ Diamond Estates has a limited business history

➢ Additional financing may be required

➢ There is no assurance of profitability

➢ Diamond Estates depends on key management and personnel

➢ Government regulation of liquor industry can affect Diamond Estates’ business

➢ Agricultural risk due to dependence on consistent supply of quality grapes

➢ There is significant competition in the industry

➢ The global financial crisis and market conditions continue to effect the economy generally

➢ Inability to manage growth could have a material adverse effect

➢ Diamond Estates has incurred indebtedness and must make interest payments and comply with other covenants in order to avoid defaulting under this debt

➢ Diamond Estates may need to issue debt in future

➢ Any investment may be subject to future dilution

➢ Price volatility of publicly traded securities in the market generally is a risk

➢ Certain directors may have conflicts of interest

➢ Diamond Estates has not paid dividends and will not be doing so in the foreseeable future

➢ Success depends on labour costs; shortages and adverse labour relations can have an adverse effect

➢ There are foreign exchange risks for inventories purchased in a foreign currency

➢ Energy costs could increase resulting in increased prices

➢ Taxation of alcoholic beverages is subject to change

➢ Trademarks protection is not assured

➢ Capacity, inventory, warehouse and distribution systems are of critical importance

➢ Wholesale cost increases can have material adverse effect on operations

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2018 – Solidifying the Foundation

❖ New Vision for the company

❖ Financial sustainability + investing for growth

❖ Exceptional growth in Winery retail sales

❖ Seizing the grocery opportunity

❖ Continued export growth

❖ Disciplined brand focus

❖ Launch of Trajectory Beverages

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New Strategic Foundation

VISION

To bring to Canadians the best wine, beer and spirit

products & experiences that the world has to offer

VALUES

Community

Collaboration

Respect

Accountability

Adventurous.

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Fiscal 2018 Financial Review

Fiscal 2017 Fiscal 2018 Change

Revenue $34.3M $34.3M --

Gross Profit $13.9M $15.2M + 9.0%

Gross Margin 40.6% 44.3% + 3.7%

EBITDA $2.8M $2.5M - 11.9%

Adjusted EBITDA $3.3M $3.7M + 13.0%

Net Income $0.5M $0.0M - $0.5M

Earnings per Share $0.01 $0.00 - $0.01

Cash Flow from

Operations$1.8M $1.6M - $0.2M

Fiscal 2018 was a transitional year that positioned

Diamond Estates for future growth

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Balance Sheet Highlights As at March 31,

2018

As at June 30,

2018

Current Assets $20.4M $22.5M

Other Assets $21.8M $23.8M

Total Liabilities $25.9M $28.4M

Shareholders’ Equity $16.3M $17.9M

Solid Financial Position

❖ Working capital was $14.6 million at end of Q1 2019

❖ Debt-to-Equity ratio of 1.2:1, reflecting acquisition of Backyard Vineyards

Solid balance sheet positions Diamond Estates to

continue pursuing growth objectives

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Q1 2019 Financial Review

Q1 2018 Q1 2019 Change

Revenue $9.6M $8.0M - 16.9%

Gross Profit $4.4M $3.7M - 16.1%

Gross Margin (%) 45.5% 46.0% + 0.5%

EBITDA $1.4M $0.8M - $0.7M

Net Income $0.9M $0.1M - $0.8M

Earnings per Share $0.01 $0.00 - $0.01

Cash Flow from Operations $1.2M $0.6M - $0.7M

Continued profitability in Q1 2019 despite

short-term operating challenges

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The Lakeview Wine Co.

❖ 57% increase in sales vs last year

❖ 77% increase in average basket to $32.44/basket

❖ 86% increase in Wine Club membership

❖ 37% increase in Online sales

❖ Increased tour bookings – 7 additional companies

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Significant Success in Ontario Grocery

❖ Listings in all 70 licensee and all

65 private wine stores

❖ # 2 in sales (12.5% share)

❖ 4 of top 7 selling SKUs

❖ Well positioned for the growth in

grocery under new Ontario

government

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Growing Export Markets

❖ China business up 29%

❖ New markets opened – USA,

UK, Korea, Vietnam, Mexico

❖ Continued expansion into

other major export markets

❖ Focus on Ice wine and

reserve wines (red, whites and sparkling)

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Acquisitions

❖ Acquired BC winery – Backyard Vineyards in June

❖ Small BC winery located in the lower valley

❖ Adds $2MM in gross sales and $200K EBITDA in F2019

❖ Rights to 10 acre development on the Naramata Bench in the Okanagan Valley

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Strengthened Brand Performance

❖ Selective price increases

❖ Increased brand building; reduced LTO’s / BAMs

❖ LCBO

❖ 6 new product listings

❖ Additional Vintages buys

❖ FRESH Moscato #1 with a +110% growth

❖ New listings in Manitoba, Saskatchewan, Alberta and Nova Scotia

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Increased Marketing Support

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Award-Winning Winemaking Team

❖ Strategic focus adopted for award

show submissions

❖ Strong results: 47 awards in major

international and domestic competitions

❖Numerous major (gold) awards

including: Best in Show Desert Wine –

Intervin International, All Canadian

Wine Championship and Wine Align

National Championship

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Trajectory Beverages – Poised for Growth

❖ New leadership – Chris Terrio

❖ Transformed the division to Trajectory

Beverage Partners

❖ Intensified new business pursuit

(addition of Amsterdam Brewery, Ron

Barcelo Rum, Edinburgh Gin, Malfy Gin)

❖ Portfolio of strong supplier brands

❖ Strengthened brand marketing team

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Trajectory Beverages – Poised for Growth

❖ New leadership – Chris Terrio

❖ Transformed the division to Trajectory

Beverage Partners

❖ Intensified new business pursuit

(addition of Amsterdam Brewery, Ron

Barcelo Rum, Edinburgh Gin, Malfy Gin)

❖ Portfolio of strong supplier brands

❖ Strengthened brand marketing team

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Meeting the Challenges

❖ Expanded production capacity – now 5.8 million litres

❖ Revamped sales structure focused on fact-based value selling

❖ Launch of ERP for deliver in F2019

❖ Consolidation of admin resources across Winery / Trajectory

(finance & admin; sales; HR)

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Summary

❖ Maintaining operational and financial momentum

❖ Overcoming short-crop – renewing domestic growth

❖ Brand focus opening new opportunities domestically and

internationally

❖ Ongoing focus on acquisition opportunities

❖ Well positioned for continued strong performance

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Thank you for your continued

confidence and support!