Canada Dividend Investor: CDL.A - /CORRECTION from Source -- Corby Distilleries Limited/ (CAD 0.54)

Company: Corby Distill
Stock Name: CDL.A
Amount: CAD 0.54
Announcement Date: 07/11/2012
Record Date: 12/12/2012

Dividend Detail:

In c5671 transmitted at 11:45e an error occurred in two paragraphs
within the release. "In view of the substantial impact the October 31, 2012" should read "In
view of the substantial impact the October 31, 2011." Corrected copy
follows:

Corby Distilleries Announces Special Dividend, Increased Quarterly
Dividend & Reports Earnings for Three Months Ended September 30, 2012

TORONTO, Nov. 7, 2012 /CNW/ - Corby Distilleries Limited ("Corby" or the
"Company") (TSX:CDL.A, TSX:CDL.B) declared a special dividend of $0.54
per share payable on January 10, 2013 on the Voting Class A Common
Shares and Non-voting Class B Common Shares of Corby to shareholders of
record as at the close of business on December 14, 2012. In view of the
substantial impact the October 31, 2011 disposal transaction had on net
earnings, it was deemed that an element of the payout be classed as a
special dividend. The special dividend will result in a cash
distribution of $15.4 million to shareholders and will be sourced from
Corby's current surplus cash position.

This will ensure that the regular dividend is based on Corby's net
earnings from its core business activities and, subject to business
conditions and opportunities and appropriate adjustment for
extraordinary events, will be paid quarterly on the basis of an annual
amount equal to the greater of 75% of net earnings per share in the
preceding fiscal year ended June 30, and $0.60 per share.

The Corby Board of Directors today also declared a dividend of $0.17 per
share payable on December 14, 2012 on the Voting Class A Common Shares
and Non-voting Class B Common Shares of the Company to shareholders of
record as at the close of business on November 30, 2012, which
represents an increase to regular quarterly dividends of 13% when
compared to last year.

Net earnings for the quarter ended September 30, 2012 totaled $7.0
million (or $0.25 per share), representing a decrease of $2.5 million
when compared with the same quarter last year. The financial results
for the quarter were substantially impacted by the sale of certain
non-core brands and the subsidiary that owned the manufacturing plant
in Montreal on October 31, 2011.

After removing the impact of the aforementioned sale transaction, net
earnings for the quarter were $7.0 million or $0.25 per share compared
to $8.0 million or $0.28 per share when compared with the same quarter
last year. The decrease in net earnings is primarily the result of
having made significantly higher investment in advertising and
promotional activities phased into this quarter when compared with the
same quarter last year. This was partially offset by a strong shipment
volume performance from Corby's key brands, namely Wiser's Canadian
whisky and Polar Ice vodka. The increased advertising and promotional
investment supported the Launch of Wiser's Spiced whisky and the
re-launch of Lamb's Black Sheep as well as strategic changes to key
brand's promotional calendars.

"We are happy with the strong headline growth from our priority brands,
which continue to perform ahead of their respective categories. Our
continued success is down to making large breakthrough investments
behind these priorities, and as such, our first quarter earnings are
impacted by a heavy phasing of A&P spend into this quarter." noted
Patrick O'Driscoll, President and Chief Executive Officer of Corby.

For further details, please refer to Corby's management's discussion and
analysis and consolidated financial statements and accompanying notes
for the first quarter ended September 30, 2012, prepared in accordance
with International Financial Reporting Standards.

About Corby

Corby Distilleries Limited is a leading Canadian marketer of spirits and
imported wines. Corby's portfolio of owned-brands includes some of the
most renowned brands in Canada, including Wiser's Canadian whisky,
Lamb's rum, Polar Ice vodka and McGuinness liqueurs. Through its
affiliation with Pernod Ricard S.A., Corby also represents leading
international brands such as ABSOLUT vodka, Chivas Regal, The Glenlivet
and Ballantine's Scotch whiskies, Jameson Irish whiskey, Beefeater gin,
Malibu rum, Kahl��a liqueur, Mumm champagne, and Jacob's Creek, Wyndham
Estate and Graffigna wines.

The existing Voting Class A Common Shares and Non-voting Class B Common
Shares of the Company are traded on the Toronto Stock Exchange under
the symbols CDL.A and CDL.B.

This press release contains forward-looking statements, including
statements concerning possible or assumed future results of Corby's
operations. Forward-looking statements typically are preceded by,
followed by or include the words "believes", "expects", "anticipates",
"estimates", "intends", "plans" or similar expressions. Forward-looking
statements are not guarantees of future performance. They involve
risks, uncertainties and assumptions and, as such, the Company's
results could differ materially from those anticipated in these
forward-looking statements. Accordingly, readers should not place undue
reliance on forward-looking statements. All amounts above are stated in
Canadian dollars.

CORBY DISTILLERIES LIMITED

Management's Discussion and Analysis

September 30, 2012

The following Management's Discussion and Analysis ("MD&A") dated
November 7, 2012, should be read in conjunction with the unaudited
interim condensed consolidated financial statements and accompanying
notes as at and for the three month period ended September 30, 2012,
prepared in accordance with International Financial Reporting Standards
("IFRS"). These unaudited interim condensed financial statements do not
contain all disclosures required by IFRS for annual financial
statements and, accordingly, should also be read in conjunction with
the most recently prepared annual consolidated financial statements for
the year ended June 30, 2012.

This MD&A contains forward-looking statements, including statements
concerning possible or assumed future results of operations of Corby
Distilleries Limited ("Corby" or the "Company"). Forward-looking
statements typically are preceded by, followed by or include the words
"believes", "expects", "anticipates", "estimates", "intends", "plans"
or similar expressions. Forward-looking statements are not guarantees
of future performance. They involve risks, uncertainties and
assumptions, including, but not limited to: the impact of competition;
business interruption; trademark infringement; consumer confidence and
spending preferences; regulatory changes; general economic conditions;
and the Company's ability to attract and retain qualified employees.
There can be no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking statements.
These factors are not intended to represent a complete list of the
factors that could affect the Company. Additional factors are noted
elsewhere in this MD&A.

This document has been reviewed by the Audit Committee of Corby's Board
of Directors and contains certain information that is current as of
November 7, 2012. Events occurring after that date could render the
information contained herein inaccurate or misleading in a material
respect. Corby will provide updates to material forward-looking
statements, including in subsequent news releases and its interim
management's discussion and analyses filed with regulatory authorities
as required under applicable law. Additional information regarding
Corby, including the Company's Annual Information Form, is available on
SEDAR at www.sedar.com.

The Company's fiscal year end is June 30. Unless otherwise indicated,
all comparisons of results for the first quarter of fiscal 2013 (three
months ended September 30, 2012) are against results for the first
quarter of fiscal 2012 (three months ended September 30, 2011). All
dollar amounts are in Canadian dollars unless otherwise stated.

Business Overview

Corby is a leading Canadian marketer of spirits and importer of wines.
Corby's national leadership is sustained by a diverse brand portfolio
that allows the Company to drive profitable organic growth with strong,
consistent cash flows. Corby is a publicly traded company, with its
shares listed on the Toronto Stock Exchange under the symbols "CDL.A"
(Voting Class A Common Shares) and "CDL.B" (Non-Voting Class B Common
Shares). Corby's Voting Class A Common Shares are majority-owned by
Hiram Walker & Sons Limited ("HWSL") (a private company) located in
Windsor, Ontario. HWSL is a wholly-owned subsidiary of international
spirits and wine company Pernod Ricard S.A. ("PR") (a French public
limited company), which is headquartered in Paris, France. Therefore,
throughout the remainder of this MD&A, Corby refers to HWSL as its
parent, and to PR as its ultimate parent. Affiliated companies are
those that are also subsidiaries of PR.

The Company derives its revenues from the sale of its owned-brands
("Case Goods"), as well as earning commission income from the
representation of selected non-owned brands in Canada ("Commissions").
The Company also supplements these primary sources of revenue with
other ancillary activities incidental to its core business, such as
logistics fees and miscellaneous bulk spirit sales. Revenue from
Corby's owned-brands predominantly consists of sales made to each of
the provincial liquor boards in Canada, and also includes sales to
international markets. Comparative figures for the period ending
September 30, 2011 also include contract bottling services which were
derived from a formerly owned bottling facility (sold October 31,
2011).

Corby's portfolio of owned-brands includes some of the most renowned
brands in Canada, including Wiser's Canadian whisky, Lamb's rum, Polar
Ice vodka and McGuinness liqueurs. Through its affiliation with PR,
Corby also represents leading international brands such as ABSOLUT
vodka, Chivas Regal, The Glenlivet and Ballantine's Scotch whiskies,
Jameson Irish whiskey, Beefeater gin, Malibu rum, Kahl��a liqueur, Mumm
champagne, and Jacob's Creek, Wyndham Estate, Stoneleigh and Graffigna
wines. In addition to representing PR's brands in Canada, Corby also
provides representation for certain selected, unrelated third-party
brands ("Agency brands") when they fit within the Company's strategic
direction and, thus, complement Corby's existing brand portfolio.

Pursuant to a production agreement that expires in September 2016, PR
produces Corby's owned-brands at HWSL's production facility in Windsor,
Ontario. Under the production agreement, Corby manages PR's business
interests in Canada, including HWSL's production facility, also until
September 2016.

The Company sources more than 80% of its spirits production requirements
from HWSL at its production facility in Windsor, Ontario. The Company's
remaining production requirements have been outsourced to third party
vendors. The Company also utilizes a third-party manufacturer in the UK
to produce its Lamb's rum products destined for sale in countries
located outside North America. Corby's Lamb's rum products sold in
North America continue to be manufactured at HWSL's production
facility.

In most provinces, Corby's route to market in Canada entails shipping
its products to government-controlled liquor boards ("LBs"). The LBs
then sell directly, or control the sale of, beverage alcohol products
to end consumers. The exception to this model is Alberta, where the
retail sector is privatized. In this province, Corby ships products to
a bonded warehouse that is managed by a government-appointed service
provider who is responsible for warehousing and distribution into the
retail channel.

Corby's shipment patterns to the LBs will not always exactly match
short-term consumer purchase patterns. However, given the importance of
monitoring consumer consumption trends over the long term, the Company
stays abreast of consumer purchase patterns in Canada through its
member affiliation with the Association of Canadian Distillers ("ACD"),
which tabulates and disseminates consumer purchase information it
receives from the LBs to its industry members. Corby refers to this
data throughout this MD&A as "retail sales", which are measured both in
volume (measured in nine-litre-case equivalents) and in retail value
(measured in Canadian dollars).

Corby's international business is concentrated in the US and UK and the
Company has a different route to market for each. For the US market,
Corby manufactures its products in Canada and ships directly to its US
distributor.�� For the UK market, Corby utilizes a third party contract
bottler and distribution company for the production and distribution of
Lamb's rum. International sales typically account for less than 10% of
Corby's total annual sales. Distributors in both markets sell to
various local wholesalers and retailers who in turn sell directly to
the consumer. Reliable consumer purchase data is not readily available
for these international markets and is, therefore, not discussed in
this MD&A.

Corby's operations are subject to seasonal fluctuations: sales are
typically strong in the first and second quarters, while third-quarter
sales usually decline after the end of the retail holiday season.
Fourth-quarter sales typically increase again with the onset of warmer
weather as consumers tend to increase their purchasing levels during
the summer season.

Strategies and Outlook

Corby's business strategies are designed to maximize sustainable
long-term value growth, and thus deliver solid profit while continuing
to produce strong and consistent cash flows from operating activities.
The Company's portfolio of owned and represented brands provides an
excellent platform from which to achieve its current and long-term
objectives moving forward.

Management believes that having a focused brand prioritization strategy
will permit Corby to capture market share in the segments and markets
that are expected to deliver the most growth in value over the long
term. Therefore, the Company's strategy is to focus its investments on,
and leverage the long-term growth potential of, its key brands. As a
result, Corby will continue to invest behind its brands to promote its
premium offerings where it makes the most sense and drives the most
value for shareholders.

Brand prioritization requires an evaluation of each brand's potential to
deliver upon this strategy, and facilitates Corby's marketing and sales
teams' focus and resource allocation. Over the long term, management
believes that effective execution of its strategy will result in value
creation for shareholders. Recent disposal transactions (the sale of
the Seagram Coolers brand in March 2011, and the October 2011 sale of
certain non-core brands and the subsidiary that owned the Montreal
bottling facility) reflect this strategy by streamlining Corby's
portfolio and thus refocusing resources on key brands.

Key to brand strategies being implemented is an effective route to
market strategy. Corby is committed to investing in its trade marketing
expertise and ensuring that its commercial resources are focused around
the differing needs of its customers and the selling channels they
inhabit.

In addition, management is convinced that innovation is key to seizing
new profit and growth opportunities. Successful innovation can be
delivered through a structured and efficient process as well as
consistent investment in consumer insight and research and development
("R&D"). As far as R&D is concerned, the Company benefits from access
to leading-edge practices at PR's North American hub, which is located
in Windsor, Ontario.

Finally, the Company is a strong advocate of social responsibility,
especially with respect to its sales and promotional activities. Corby
will continue to promote the responsible consumption of its products in
its activities. The Company stresses its core values throughout its
organization, including those of conviviality, straightforwardness,
commitment, integrity and entrepreneurship.

Significant Events

Corby's Board of Directors declare a special dividend

On November 7, 2012, the Corby Board of Directors declared a special
dividend of $0.54 per share payable on January 10, 2013 on the Voting
Class A Common Shares and Non-voting Class B Common Shares of Corby to
shareholders of record as at the close of business on December 14,
2012. In view of the substantial impact the October 31, 2011 disposal
transaction had on net earnings, it was deemed that an element of the
payout be classed as a special dividend. This will ensure that the
regular dividend is based on Corby's net earnings from its core
business activities and, subject to business conditions and
opportunities and appropriate adjustment for extraordinary events, will
be paid quarterly on the basis of an annual amount equal to the greater
of 75% of net earnings per share in the preceding fiscal year ended
June 30, and $0.60 per share.

In addition, also on November 7, 2012, the Corby Board of Directors
declared a regular dividend of $0.17 per share payable on December 14,
2012 on the Voting Class A Common Shares and Non-voting Class B Common
Shares of Corby to shareholders of record as at the close of business
on November 30, 2012.

The special and regular dividend will result in a cash distribution of
$15.4 million and $4.8 million, respectively, to shareholders and will
be sourced from Corby's current surplus cash position.

Corby Distilleries Limited and Pernod Ricard USA, LLC Announce
Distribution Agreement

Effective as of July 1, 2012, the Company entered into a five year
agreement with Pernod Ricard USA, LLC ("PR USA"), an affiliated
company, which provides PR USA the exclusive rights to represent
Wiser's Canadian whisky and Polar Ice vodka in the US. Previously,
Wiser's Canadian whisky and Polar Ice vodka were represented by an
unrelated third party in this market. The agreement provides these key
brands with access to PR USA's extensive national distribution network
throughout the US and complements PR USA's premium brand portfolio. The
agreement is effective for a five year period ending June 30, 2017.
Since the agreement with PR USA is a related party transaction between
Corby and PR USA, the agreement was approved by the Independent
Committee of the Board of Directors of Corby following an extensive
review, in accordance with Corby's related party transaction policy.

Brand Performance Review

Corby's portfolio of owned-brands accounts for more than 80% of the
Company's total annual revenue. Included in this portfolio are its key
brands: Wiser's Canadian whisky, Lamb's rum, Polar Ice vodka and
Corby's mixable liqueur brands. The sales performance of these key
brands significantly impacts Corby's net earnings. Therefore,
understanding each key brand is essential to understanding the
Company's overall performance.

Shipment Volume and Shipment Value Performance

The following chart summarizes the performance of Corby's owned-brands
in terms of both shipment volume (as measured by shipments to customers
in equivalent nine-litre cases) and shipment value (as measured by the
change in gross sales revenue). The chart includes results for sales in
both Canada and international markets. Specifically, the Wiser's,
Lamb's and Polar Ice brands are also sold to international markets,
particularly in the US and UK. International sales typically account
for less than 10% of Corby's total annual revenues.

��

BRAND PERFORMANCE CHART - INCLUDES BOTH CANADIAN AND INTERNATIONAL
SHIPMENTS

��

Three Months Ended

��

% Shipment

��

% Shipment

��

Sept. 30,

��

Sept. 30,

��

Volume

��

Value

(Volumes in 000's of 9L cases)

��

2012

��

2011

��

Growth

��

Growth

��

Brand ��

��

Wiser's Canadian whisky

��

204

��

196

��

Lamb's rum ��

��

150

��

148

��

Polar Ice vodka ��

��

109

��

16%

��

22%

Mixable liqueurs ��

��

(13%)

��

(9%)

��

Total Key Brands ��

��

504

��

485

��

Other Corby-owned brands

��

(8%)

��

(2%)

��

Total Corby brands ��

��

562

��

548

��

Disposed brands

��

(100%)

��

(100%)

��

Total Corby brands including Disposed Brands

��

562

��

630

��

(11%)

��

(5%)

��

Note that the above chart segregates "Disposed Brands" from the other
Corby-owned brands. Disposed Brands include brands that are no longer
owned by Corby as a result of the sale of certain non-core brands and
the subsidiary that owned the Montreal plant on October 31, 2011.
Shipment information associated with these Disposed Brands has been
segregated in an effort to display the non-recurring impact on Corby's
shipments, as comparisons with prior periods are otherwise no longer
meaningful given that Corby no longer owns these brands. Up until the
date of their sale, the Disposed Brands sold in the October 31, 2011
sale transaction were showing a trend of decline of 4% over prior year
performance.

During the quarter, Corby's brands (excluding Disposed Brands) showed 3%
growth in shipment volume and 6% growth in shipment value when compared
to the same quarter last year.�� The Canadian spirits market is trending
at +3%�� in both retail volume and value based on the same three month
period ended September 30, 2012.

Polar Ice vodka had a particularly strong quarter with shipment volume
and value growth of +16% and +22%, respectively. The vodka category in
Canada continued its strong growth (+5% retail volumes) while Polar Ice
also significantly benefited from a change in its promotional calendar.
Corby's flagship brand, Wiser's Canadian whisky, had a successful
quarter with shipment volume and value increases of 4% and 7%,
respectively. While market trends for Canadian whisky remained
relatively flat, Wiser's continues to outperform its category as it too
enjoyed strong support from various media and other promotional
programmes. Additionally, the brand's new innovative brand extension
"Wiser's Spiced" recently launched and started shipping during the end
of the quarter. Shipment volumes for Corby's mixable liqueur brands
were behind that of the comparative period, however, mostly reflect
changes to the brand's promotional calendar as retail trends continue
to be steady and outpaced results for the overall liqueur category.

Internationally, Corby's shipment volumes improved 5% on a quarter over
quarter comparison basis. While shipments of Wiser's and Polar Ice to
the US remained consistent, Lamb's rum volumes in the UK benefited on
account of a changing shipment profile since moving its international
production to a third party bottler in the UK.

Retail Volume and Retail Value Performance

It is of critical importance to understand the performance of Corby's
brands at the retail level in Canada. Analysis of performance at the
retail level provides insight with regards to consumers' current
purchase patterns and trends. Retail sales data, as provided by the
ACD, is set out in the following chart and is discussed throughout this
MD&A. It should be noted that the retail sales information presented
does not include international retail sales of Corby-owned brands, as
this information is not readily available. International sales
typically account for less than 10% of Corby's total annual revenues.

��

RETAIL SALES FOR THE CANADIAN MARKET ONLY¹

��

Three Months Ended

��

% Retail

��

% Retail

��

Sep. 30,

��

Sep. 30,

��

Volume

��

Value

(Volumes in 000's of 9L cases)

��

2012

��

2011

��

Growth

��

Growth

��

Brand ��

��

Wiser's Canadian whisky

��

172

��

167

��

Lamb's rum ��

��

108

��

114

��

(5%)

��

(8%)

Polar Ice vodka

��

101

��

18%

��

13%

Mixable liqueurs

��

(1%)

��

Total Key Brands

��

424

��

410

��

Other Corby-owned brands ²

��

(4%)

��

(7%)

��

Total ��

��

478

��

466

��

⁽¹⁾ Refers to sales at the retail store level in Canada, as provided by the
Association of Canadian Distillers.

⁽²⁾ Brands impacted by the October 31, 2011 sales transaction have been
excluded from this chart. ��

��

In an effort to maintain focus on Corby's continuing business activities
and the Company's brand prioritization strategy, brands impacted by the
aforementioned sale transactions have been excluded from the above
chart.

Overall, the retail volume performance of Corby-owned brands was
consistent with trends seen in the Canadian spirits industry as a
whole. The Canadian spirits industry increased +3% in both retail
volume and retail value. Corby's key brands showed retail volume growth
consistent with the market at +3%, while retail values grew +2%.

The growth in the Canadian spirits industry continued to be led by the
vodka and rum categories (especially spiced rum). The vodka category
had growth of +5% in retail volume and +4% retail value for the three
month period ending September 30, 2012. The rum category showed retail
volume and value growth of +3% during this same period. Whereas, the
Canadian whisky category remained relatively flat for both retail
volumes and retail value.

Summary of Corby's Key Brands

Wiser's Canadian Whisky

Corby's flagship brand, Wiser's Canadian whisky, once again outperformed
the Canadian whisky category with +3% growth in retail sales volumes
and value during the three month period ending September 30, 2012.
Meanwhile the Canadian whisky category remained flat during this
period. The Company continued to build upon the brand's success and
capitalize on market trends for premium and flavoured spirits with the
launch of Wiser's Spiced during the quarter.

Lamb's Rum

Lamb's rum, one of the top-selling rum families in Canada, experienced a
decline in retail volumes during the three month period ending
September 30, 2012. Specifically, retail volume decreased 5% while
retail value declined 8% on a quarter over quarter comparison basis,
while the rum category in Canada increased 3% on retail value and
retail volume. The growth in the rum category has been entirely driven
by the growth in the spiced rum category, while consumer consumption of
white rum has been flat on a quarter-over-quarter comparison basis. The
Lamb's rum family has a significant amount of its volume weighted in
white rum, and its performance is reflective of the performance of the
category. Most recently during the summer months of 2012, the Company
re-launched its spiced rum variant, Lamb's Black Sheep, offering an
improved flavour profile and new packaging.

Polar Ice Vodka

Polar Ice vodka is among the top three largest vodka brands in Canada.
Changes to the brand's promotional calendar and strategic pricing in
key markets during the quarter have further built upon success the
brand achieved in the last fiscal year. Market trends show growth of
+18% in retail volume and +13% in retail value. The vodka category in
Canada was +5% for retail volume and +4% for retail value when compared
to the same three month period of the prior year. Aggressive investment
in key markets, specifically Alberta, supported with an outdoor
"Canada's Vodka" media campaign and strategic pricing were key reasons
consumers have re-engaged with the brand during the last year.

Mixable Liqueurs

Corby's portfolio of mixable liqueur brands consists of McGuinness
liqueurs (which is Canada's largest mixable liqueur brand family) and
Meaghers liqueurs. Retail value and volumes for Corby's mixable
liqueurs portfolio where slightly ahead of market trends (retail volume
and value at -1%) when compared to the same period last year, while the
category as a whole declined -2% for volume and -3% for value over this
same period.

Other Corby-Owned Brands

Other Corby-Owned brands as a group had declines in retail volume of -4%
and -7% in retail value for the three month period ending September 30,
2012. Royal Reserve, a Canadian whisky, is the most significant brand
in this grouping. This brand's performance was behind the Canadian
whisky category as a whole, with retail volumes at -7% and retail value
at -9% for the same three month period. The brand experienced
difficulties in Western Canada as consumers trended toward more premium
whisky offerings.

Financial and Operating Results

The following table presents a summary of certain selected consolidated
financial information of the Company for the years ended September 30,
2012 and 2011.

��

(in millions of Canadian dollars,

��

Three Months Ended

��

Sept. 30,

��

Sept. 30,

��

except per share amounts)

��

��2012

��

2011^��

��

$ Change

��

��% Change��

��

Revenue

��

35.9

��

�� 44.2

��

(8.3)

��

(19%)

��

Cost of sales

��

(14.0)

��

(19.4)

��

5.4

��

(28%)

Marketing, sales and administration

��

(12.4)

��

(11.9)

��

(0.5)

��

Other income (expense)

��

0.0

��

(0.3)

��

0.3

��

(106%)

��

Earnings from operations

��

9.5

��

12.6

��

(3.1)

��

(25%)

��

Financial income

��

0.4

��

0.5

��

(0.1)

��

(20%)

Financial expenses

��

(0.1)

��

(0.2)

��

0.1

��

(32%)

Net financial income

��

0.3

��

0.3

��

0.0

��

Earnings before income taxes

��

9.8

��

12.9

��

(3.2)

��

(24%)

Income taxes

��

(2.8)

��

(3.5)

��

0.7

��

(20%)

��

Net earnings

��

7.0

��

9.5

��

(2.5)

��

(26%)

��

Per common share

��

- Basic net earnings

��

0.25

��

0.33

��

(0.09)

��

(26%)

��

- Diluted net earnings

��

0.25

��

0.33

��

(0.09)

��

(26%)

��

Overall Financial Results

Financial results for the quarter were substantially impacted by the
sale of certain non-core brands and the subsidiary that owned the
manufacturing plant in Montreal on October 31, 2011. As such, from
November 1, 2011 and onward, results are impacted by the reduction of
earnings resulting from this sale transaction as Corby's results no
longer include earnings associated with the brands and manufacturing
facility sold. However, the comparative period for the quarter ended
September 30, 2011 includes the financial results of those brands and
activities related to the bottling plant for the full three month
period, given the Company's ownership at that time. In order to
effectively assess Corby's current year's results against those of the
prior year, the impact of the aforementioned sale transaction has been
removed from the discussion, where noted.

As noted in the Financial and Operating Results chart, the Company's net
earnings decreased $2.5 million for the quarter compared to same
quarter last year. After removing the impacts of the aforementioned
sale transaction, net earnings decreased $1.0 million or 13%, when
compared to the same quarter last year. Earnings per share decreases
mirror these results on the same comparative basis.

Positive shipment value growth (+6%) from Corby's owned-brands was
offset by the Company having made significantly higher (+$1.4 million)
investment in advertising and promotional activities phased into this
quarter when compared with the same quarter last year. In addition,
commission income from represented brands was also lower (-$0.4
million), on account of reduced commissioned sales volumes and the
receipt of a one-time termination payment from a formerly represented
brand owner in the comparative period.

The increased advertising and promotional investment this quarter
supported the launch of Wiser's Spiced whisky and the re-launch of
Lamb's Black Sheep. As well, a shift in the promotional calendar versus
last year related to a Polar Ice vodka program also contributed to the
increased spend on a quarter over quarter comparison basis.

Revenue

The following highlights the key components of the Company's revenue
streams:

��

Three Months Ended

��

Sept. 30,

��

Sept. 30,

��

(in millions of Canadian dollars)

��

��2012

��

2011

��

$ Change

��

��% Change��

��

Revenue streams:

��

��Case goods (excluding Disposed Brands)

��

28.5

��

28.1

��

0.4

��

��Commissions

��

4.3

��

4.7

��

(0.4)

��

(9%)

��Other services

��

3.1

��

1.5

��

1.6

��

107%

Revenue, excluding Disposed Brands

��

35.9

��

34.3

��

1.6

��

Disposed Brands

��

9.9

��

(9.9)

��

(100%)

��

Revenue

��

35.9

��

44.2

��

(8.3)

��

(19%)

��

Removing the impact of the aforementioned sale transaction (which is
denoted in the above chart as "Disposed Brands"), revenue from the
remaining Corby brand portfolio and other business activities increased
+5% compared to the same period last year or $1.6 million.

As previously discussed in the "Shipment Volume and Shipment Value
Performance" section of this MD&A, Corby's owned-brands, or "Case
Goods", saw its gross revenue increase +6% this quarter when compared
to the same quarter last year. Note however, that international
accounting standards require that certain advertising and promotional
activities be reported net of revenue. As such, the revenue chart
presented above indicates a net increase in Case Goods revenue of +1%,
or $0.4M.

The increase in Case Goods revenue is driven by new pricing strategies
and refocused promotional activities for certain key brands, notably
Polar Ice vodka and Wiser's Canadian whisky. Case goods also benefited
from the introduction of new innovations, most notably Wiser's Spiced
whisky, and increased export sales activity in the UK markets.

Commissions are earned from the representation of PR and select Agency
brands in the Canadian market. The Company experienced a decrease of
$0.4 million this quarter on account of reduced commissioned sales
volumes combined with the impact of having received a one-time
termination payment from a formerly represented Agency brand owner in
the comparative period.

Other services include revenue ancillary to the sale of Case Goods, such
as logistics fees and miscellaneous bulk spirit sales. The increase in
other services is almost entirely the result of having a higher volume
of bulk whisky sales to a former contract bottling customer; these
sales are not expected to continue into future periods as Corby's
contractual commitments have now been fulfilled.

Cost of sales

Cost of sales was $14.0 million, representing a decrease of 28%, or $5.4
million on a quarter over quarter comparison basis. The decrease in
cost of sales is mostly the result of the aforementioned disposal
transaction, as the Company no longer incurred production costs
associated with the disposed brands and bottling facility. Gross margin
for the year was 55.6% versus 51.0% last year (note: commissions are
not included in this calculation). The improvement in gross margin is
also a result of the disposal transactions (i.e., sale of the Montreal
plant and certain non-core brands as of October 31, 2011). The revenues
derived from the formerly owned-brands and bottling facility generated
significantly less margin than Corby's remaining Case Goods business.

Marketing, sales and administration

Marketing, sales and administration expenses were $12.4 million for the
quarter, an increase of 4% or $0.5 million compared to the same quarter
last year. This increase is primarily driven by advertising and
promotional spend for key brands and new product innovations.
Administrative expenses have remained consistent with the comparative
period.

Other Income and Expenses

Other income and expenses include such items as realized foreign
exchange gains and losses, gains on sale of property and equipment, and
amortization of actuarial gains and losses related to the Company's
pension and post-retirement benefit plans. The comparative period
includes $0.4 million in legal, professional and other types of fees
related to the aforementioned sale transaction, which closed subsequent
to the quarter ending September 30, 2011.

Net Financial Income

Net financial income is comprised of interest earned on deposits in cash
management pools, offset by interest costs associated with the
Company's pension and post-retirement benefit plans. This balance is
relatively consistent quarter-over-quarter.

Income taxes

Income tax expense for the year was $2.8 million as compared to $3.5
million last year. The following chart provides a reconciliation of the
effective tax rate to the statutory rates for the period:

��	��	��	��	��	��	��	��
��	��	��	Three Months Ended
��	��	��	*Sept. 30,*	��	��	��	Sept. 30,
��	��	��	*2012*	��	��	��	2011
��	��	��	��	��	��	��	��
Combined basic Federal and Provincial tax rates	��	��	27%	��	��	��	27%
Other	��	��	1%	��	��	��	0%
��	��	��	��	��	��	��	��
Effective tax rate ��	��	��	28%	��	��	��	27%
��	��	��	��	��	��	��	��

��

Liquidity and Capital Resources

Corby's sources of liquidity are its deposits in cash management pools
of $112.9 million as at September 30, 2012, and its cash generated from
operating activities. Corby's total contractual maturities are
represented by its accounts payable and accrued liabilities and income
and other taxes payable balances, which totalled $25.1 million as at
September 30, 2012, and are all due to be paid within one year. The
Company does not have any liabilities under short- or long-term debt
facilities.

In addition, and as discussed in the Related Party section of this MD&A,
the company has a commitment to purchase the representation rights for
ABSOLUT and Plymouth gin brands for an additional term beginning
September 30, 2013. The additional term will commence September 30,
2013 and last until September 29, 2021 and will require a cash payment
of $10.3 million on the date of commencement. The cost of the
additional term will be recorded as a definite-lived intangible asset
and will be amortized on a straight-line basis over the 8 year term of
the agreement. The amortization will be recorded net of commissions.
This treatment is consistent with current accounting policies applied
to long-term representation rights. Funding for the settlement of this
commitment will be sourced from deposits in cash management pools.

The Company believes that its deposits in cash management pools,
combined with its historically strong operational cash flows, provide
for sufficient liquidity to fund its operations, investing activities
and commitments for the foreseeable future. The Company's cash flows
from operations are subject to fluctuation due to commodity, foreign
exchange and interest rate risks. Please refer to the "Risks and Risk
Management" section of this MD&A for further information.

Cash flows

��

Three Months Ended

��

Sept. 30,

��

Sept. 30,

��

(in millions of Canadian dollars)

��

2012

��

2011^��

��

Change

��

Operating activities

��

Net earnings, adjusted for non-cash items

��

10.9

��

�� 14.3

��

(3.4)

��

Net change in non-cash working capital

��

2.0

��

2.6

��

(0.6)

��

Net payments for interest and income taxes

��

(5.9)

��

(3.3)

��

(2.6)

��

7.0

��

13.6

��

(6.6)

��

Investing activities

��

Proceeds from disposition of property and equipment

��

0.1

��

0.1

��

Deposits in cash management pools

��

(2.8)

��

(9.6)

��

6.8

��

(2.7)

��

(9.6)

��

6.9

��

Financing activities

��

Dividends paid

��

(4.3)

��

(4.0)

��

(0.3)

��

Net change in cash

��

��$

�� -

��

Operating activities

During the quarter, net cash flows from operating activities was $7.0
million compared to $13.6 million in the same quarter last year,
representing a decrease of $6.6 million. Cash flows from operating
activities have been significantly impacted by the previously mentioned
sale of the Montreal plant and non-core brands. Reduced net earnings,
adjusted for non-cash items, have been further impacted by an increase
in tax payments compared to the same period last year.

Investing activities

Cash used in investing activities was $2.7 million this quarter compared
to $9.6 million during the same quarter last year and substantially
reflects the amount deposited in cash management pools. Changes in the
amount deposited in cash management pools is dependent on how much cash
is available after operating, other investing, and financing activities
are completed. In the current year, less cash was deposited primarily
due to a lower amount of cash generated from operating activities and a
higher amount of dividends paid.

Deposits made to cash management pools represent cash on deposit with
The Bank of Nova Scotia via Corby's Mirror Netting Service Agreement
with PR. Corby has daily access to these funds and earns a market rate
of interest from PR on its deposits. For more information related to
these deposits, please refer to the "Related Party Transactions"
section of this MD&A.

Financing activities

Cash used for financing activities totals $4.3 million for the quarter
and represents the payment of dividends to shareholders. Dividend
payments increased over the prior year due to changes to the dividend
policy which increased regular quarterly dividends to $0.15 per share
from $0.14 per share effective November 9, 2011. The payment of these
dividends is in accordance with the Company's stated dividend policy.

The following table summarizes dividends paid and payable by the Company
over the last two fiscal years:

for

��

Declaration date

��

Record Date

��

Payment date

��

$ / Share

��

2013 - special

��

November 7, 2012 (special dividend)

��

December 14, 2012

��

January 10, 2013

��

0.54

2013 - Q1

��

November 7, 2012

��

November 30, 2012

��

December 14, 2012

��

0.17

2012 - Q4

��

August 29, 2012

��

September 15, 2012

��

September 30, 2012

��

0.15

2012 - Q3

��

May 10, 2012

��

May 31, 2012

��

June 15, 2012

��

0.15

2012 - Q2

��

February 8, 2012

��

February 29, 2012

��

March 15, 2012

��

0.15

2012 - special

��

November 9, 2011 (special dividend)

��

December 15, 2011

��

January 3, 2012

��

1.85

2012 - Q1

��

November 9, 2011

��

November 30, 2011

��

December 15, 2011

��

0.15

2011 - Q4

��

August 24, 2011

��

September 15, 2011

��

September 30, 2011

��

0.14

2011 - Q3

��

May 11, 2011

��

May 31, 2011

��

June 15, 2011

��

0.14

2011 - Q2

��

February 9, 2011

��

February 28, 2011

��

March 15, 2011

��

0.14

Outstanding Share Data

As at November 7, 2012, Corby had 24,274,320 Voting Class A Common
Shares and 4,194,536 Non-Voting Class B Common Shares outstanding. The
Company does not have a stock option plan, and therefore, there are no
options outstanding.

Related Party Transactions

Transactions with parent, ultimate parent, and affiliates

Corby engages in a significant number of transactions with its parent
company, its ultimate parent and various affiliates. Specifically,
Corby renders services to its parent company, its ultimate parent, and
affiliates for the marketing and sale of beverage alcohol products in
Canada. Furthermore, Corby outsources the large majority of its
distilling, maturing, storing, blending, bottling and related
production activities to its parent company. A significant portion of
Corby's bookkeeping, recordkeeping services, data processing and other
administrative services are also outsourced to its parent company.
Transactions with the parent company, ultimate parent and affiliates
are subject to Corby's related party transaction policy.

The companies operate under the terms of agreements that became
effective on September 29, 2006. These agreements provide the Company
with the exclusive right to represent PR's brands in the Canadian
market for 15 years, as well as providing for the continuing production
of certain Corby brands by PR at its production facility in Windsor,
Ontario, for 10 years. Corby also manages PR's business interests in
Canada, including the Windsor production facility. Certain officers of
Corby have been appointed as directors and officers of PR's Canadian
entities, as approved by Corby's Board of Directors.

In addition to the aforementioned agreements, Corby signed an agreement
on September 26, 2008, with its ultimate parent to be the exclusive
Canadian representative for the ABSOLUT vodka and Plymouth gin brands,
for a five-year term expiring October 1, 2013. These brands were
acquired by PR subsequent to the original representation rights
agreement dated September 29, 2006.

Further, on November 9, 2011, Corby entered into an agreement with PR
for a new term for Corby's exclusive right to represent ABSOLUT vodka
in Canada from September 30, 2013 to September 29, 2021, which is
consistent with the term of Corby's Canadian representation for the
other PR brands in Corby's portfolio. Under the agreement, Corby will
pay the present value of $10 million for the additional eight years of
the new term to PR at its commencement. Since the agreement with PR is
a related party transaction, the agreement was approved by the
Independent Committee of the Corby Board of Directors, in accordance
with Corby's related party transaction policy, following an extensive
review and with external financial and legal advice. Pursuant to this
agreement, Corby also agreed to continue with the mirror netting
arrangement with PR and its affiliates, under which Corby's excess cash
will continue to be deposited to cash management pools.�� The mirror
netting arrangement with PR and its affiliates is further described
below.

On July 1, 2012, the Company entered into a five year agreement with
Pernod Ricard USA, LLC ("PR USA"), an affiliated company, which
provides PR USA the exclusive right to represent Wiser's Canadian
whisky and Polar Ice vodka in the US. The agreement provides these key
brands with access to PR USA's extensive national distribution network
throughout the US and complements PR USA's premium brand portfolio. The
agreement is effective for a five year period ending June 30, 2017. The
agreement with PR USA is a related party transaction between Corby and
PR USA, as such; the agreement was approved by the Independent
Committee of the Board of Directors of Corby following an extensive
review, in accordance with Corby's related party transaction policy.

Deposits in cash management pools

Corby participates in a cash pooling arrangement under a Mirror Netting
Service Agreement, together with PR's other Canadian affiliates, the
terms of which are administered by The Bank of Nova Scotia. The Mirror
Netting Service Agreement acts to aggregate each participant's net cash
balance for purposes of having a centralized cash management function
for all of PR's Canadian affiliates, including Corby. As a result of
Corby's participation in this agreement, Corby's credit risk associated
with its deposits in cash management pools is contingent upon PR's
credit rating. PR's credit rating as at November 7, 2012, as published
by Standard & Poor's and Moody's, was BBB- and Baa3, respectively. PR
compensates Corby for the benefit it receives from having the Company
participate in the Mirror Netting Service Agreement by paying interest
to Corby based upon the 30-day LIBOR rate plus 0.40%.

Corby accesses these funds on a daily basis and has the contractual
right to withdraw these funds or terminate these cash management
arrangements upon providing five days' written notice.

Selected Quarterly Information

Summary of Quarterly Financial Results

��

(in millions of Canadian dollars,

��

except per share amounts)

��

2013

��

2012

��

2012

��

2012

��

2012

��

2011

��

2011

��

2011

��

Revenue

��

35.9

��

32.4

��

29.2

��

40.9

��

44.2

��

40.1

��

32.4

��

45.5

Earnings from operations

��

9.5

��

6.6

��

6.1

��

33.6

��

12.6

��

9.4

��

4.3

��

13.7

Net earnings, excluding undernoted items ⁽¹⁾

��

7.0

��

4.9

��

4.6

��

9.0

��

9.9

��

6.8

��

3.1

��

9.8

Net earnings

��

7.0

��

4.9

��

4.6

��

27.1

��

9.5

��

6.8

��

4.8

��

9.8

Basic EPS

��

0.25

��

0.17

��

0.16

��

0.95

��

0.33

��

0.24

��

0.11

��

0.34

Diluted EPS

��

0.25

��

0.17

��

0.16

��

0.95

��

0.33

��

0.24

��

0.11

��

0.34

⁽¹⁾ Net earnings have been adjusted for the net after-tax gain on the sale
of plant and brands of $17.7 million in

��2012 and for the net after-tax loss on the sale of Seagram Coolers of
$1.7 million in 2011.

The above chart demonstrates the seasonality of Corby's business, as
sales are typically strong in the first and second quarters, while
third-quarter sales (January, February and March) usually decline after
the end of the retail holiday season. Fourth-quarter sales typically
increase again with the onset of warmer weather, as consumers tend to
increase their purchasing levels during the summer season.

The chart also highlights the effect the aforementioned sale
transactions (i.e., the sale of certain non-core brands and the
subsidiary that owned the Montreal plant in Q2-2012, and the sale of
the Seagram Coolers brand in Q3-2011) had on the quarterly results. The
line item in the chart "Net earnings, excluding undernoted items"
removes the gain or loss on sale impacts. Also note that revenue has
been substantially impacted as well, given the fact the company sold
various brands and a contract bottling facility and thus no longer
recognized revenue associated with the brands and activities after the
date of sale.

Specifically, on a quarter-over-quarter comparative basis, revenues for
Q1-2013 are lower by $9.9 million when compared to Q1-2012 due to the
aforementioned changes to the Company's brand portfolio. Removing the
impact of the aforementioned sale transactions, revenue from the
remaining Corby brand portfolio and other business activities increased
5% for Q1-2013 when compared with Q1-2012. In addition, the Company's
net earnings were impacted by the gain on the sale of the Montreal
plant and non-core brands in the amount of $18.1 million in the second
quarter for 2012. The third quarter of 2011 was impacted by a loss on
the sale of the Seagram Coolers brand in the amount of $1.7 million.

For further information regarding these sale transactions please refer
to Note 19 to the audited consolidated financial statements for the
year ending June 30, 2012.

New Accounting Pronouncements

(a)��New accounting standards

(i)��Deferred Taxes - Recovery of Underlying Assets

The IASB issued an amendment to IAS 12, "Income Taxes" ("IAS 12
amendment"), which introduces an exception to the general measurement
requirements of IAS 12 in respect of investment properties measured at
fair value. The IAS 12 amendment is effective for annual periods
beginning on or after January 1, 2012. The IAS 12 amendment did not
have an impact on the Company's results of operations, financial
position or disclosures.

(ii)��Financial Instruments - Disclosures

On June 16, 2011 the IASB issued amendments to IAS 1, "Presentation of
Financial Statements." The amendments enhance the presentation of Other
Comprehensive Income ("OCI") in the financial statements. A requirement
has been added to present items in other comprehensive income grouped
on the basis of whether they may be subsequently reclassified to
earnings in order to more clearly show the effect the items of other
comprehensive income may have on future earnings. The amendments are
effective for annual periods beginning on or after July 1, 2012. The
amendments have not had an impact on the Company's presentation of
other comprehensive income.

(b)��Recent accounting pronouncements

A number of new standards, amendments to standards and interpretations
have been issued but are not yet effective for the financial year
ending June 30, 2013, and accordingly, have not been applied in
preparing these consolidated financial statements:

(i)��Consolidated Financial Statements

In May 2011 the IASB issued IFRS 10, "Consolidated Financial Statements"
("IFRS 10"), IFRS 11, "Joint Ventures" ("IFRS 11"), and IFRS 12,
"Disclosure of Interest in Other Entities" ("IFRS 12").�� In addition,
the IASB amended IAS 27, "Consolidated and Separate Financial
Statements" ("IAS 27") and IAS 28, "Investments in Associates and Joint
Ventures" ("IAS 28"). The objective of IFRS 10 is to define the
principles of control and establish the basis of determining when and
how an entity should be included within a set of consolidated financial
statements. IFRS 11 establishes principles to determine the type of
joint arrangement and guidance for financial reporting activities
required by entities that have an interest in an arrangement that is
jointly controlled. IFRS 12 enables users of the financial statements
to evaluate the nature and risks associated with its interest in other
entities and the effects of those interests on its financial
performance.

IFRS 10, 11 and 12, and the amendments to IAS 27 and 28 are all
effective for annual periods beginning on or after January 1, 2013 and
must be applied retrospectively. For Corby, this set of standards and
amendments become effective July 1, 2013. The Company is currently
assessing the impact of IFRS 10, 11, and 12 and the amendments to IAS
27 and 28 on its consolidated financial statements.

(ii)��Fair Value Measurement

On May 12, 2011 the IASB issued IFRS 13, "Fair Value Measurement" ("IFRS
13") which defines fair value, provides guidance in a single IFRS
framework for measuring fair value and identifies the required
disclosures pertaining to fair value measurement. IFRS 13 applies to
all International Financial Reporting Standards that require or permit
fair value measurements or disclosures. IFRS 13 defines fair value as
the price that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the
measurement date. This standard is effective for annual periods
beginning on or after January 1, 2013, and must be applied
retrospectively. For Corby this standard becomes effective July 1,
2013. The Company is currently assessing the impact of IFRS 13 on its
consolidated financial statements.

(iii)��Employee Benefits

On June 16, 2011 the IASB issued amendments to IAS 19, "Employee
Benefits" ("IAS 19"), which eliminates the option to defer the
recognition of actuarial gains and losses through the "corridor"
approach, revises the presentation of changes in assets and liabilities
arising from defined benefit plans and enhances the disclosures for
defined benefit plans. IAS 19 is effective for annual periods beginning
on or after January 1, 2013, and must be applied retrospectively. For
Corby, the revisions to this standard become effective July 1, 2013.
The Company is currently assessing the impact of this amendment on its
consolidated financial statements.

(iv)��Financial Instruments - Asset and Liability Offsetting

The IASB has issued amendments to IFRS 7 and IAS 32, "Financial
Instruments: Presentation" ("IAS 32"), which clarify the requirements
for offsetting financial instruments and require new disclosures on the
effect of offsetting arrangements on an entity's financial position.
The amendments to IFRS 7 are effective for annual periods beginning on
or after January 1, 2013 and must be applied retrospectively. For
Corby, this standard will become effectively July 1, 2013. The Company
is assessing the impact of the amendments to IFRS 7 and IAS 32 on its
consolidated financial statements.

(v)��Financial Instruments

The IASB has issued a new standard, IFRS 9, "Financial Instruments"
("IFRS 9"), which will ultimately replace IAS 39, "Financial
Instruments: Recognition and Measurement" ("IAS 39"). The replacement
of IAS 39 is a multi-phase project with the objective of improving and
simplifying the reporting for financial instruments and the issuance of
IFRS 9 is part of the first phase of this project. IFRS 9 uses a single
approach to determine whether a financial asset or liability is
measured at amortized cost or fair value, replacing the multiple rules
in IAS 39. For financial assets, the approach in IFRS 9 is based on how
an entity manages its financial instruments in the context of its
business model and the contractual cash flow characteristics of the
financial assets. IFRS 9 requires a single impairment method to be
used, replacing multiple impairment methods in IAS 39. For financial
liabilities measured at fair value, fair value changes due to changes
in an entity's credit risk are presented in other comprehensive income.
IFRS 9 is effective for annual periods beginning on or after January 1,
2015 and must be applied retrospectively. For Corby, this standard will
become effective July 1, 2015. The Company is currently assessing the
impact of the new standard on its consolidated financial statements.

Internal Controls Over Financial Reporting

The Company maintains a system of disclosure controls and procedures to
provide reasonable assurance that all material information relating to
the Company is gathered and reported to senior management on a timely
basis so that appropriate decisions can be made regarding public
disclosure.

In addition, the CEO and CFO have designed, or caused to be designed
under their supervision, internal controls over financial reporting to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with IFRS. Internal control systems, no matter
how well designed, have inherent limitations. Therefore, even those
systems determined to be designed effectively can provide only
reasonable assurance with respect to financial reporting and financial
statement preparation.

There were no changes in internal control over financial reporting
during the Company's most recent interim period that have materially
affected, or are reasonably likely to materially affect, the Company's
internal controls over financial reporting.

Risks & Risk Management

The Company is exposed to a number of risks in the normal course of its
business that have the potential to affect its operating and financial
performance.

Industry and Regulatory

The beverage alcohol industry in Canada is subject to government policy,
extensive regulatory requirements and significant rates of taxation at
both the federal and provincial levels. As a result, changes in the
government policy, regulatory and/or taxation environments within the
beverage alcohol industry may affect Corby's business operations,
causing changes in market dynamics or changes in consumer consumption
patterns. In addition, the Company's provincial LB customers have the
ability to mandate changes that can lead to increased costs, as well as
other factors that may impact financial results.

The Company continuously monitors the potential risk associated with any
proposed changes to its government policy, regulatory and taxation
environments and, as an industry leader, actively participates in trade
association discussions relating to new developments.

Consumer Consumption Patterns

Beverage alcohol companies are susceptible to risks relating to changes
in consumer consumption patterns. Consumer consumption patterns are
affected by many external influences, not the least of which is the
economic outlook and overall consumer confidence in the stability of
the economy as a whole. Corby offers a diverse portfolio of products
across all major spirits categories and at various price points, which
complements consumer desires and offers exciting innovation.

Distribution/Supply Chain Interruption

The Company is susceptible to risks relating to distributor and supply
chain interruptions. Distribution in Canada is largely accomplished
through the government-owned provincial LBs and, therefore, an
interruption (e.g., a labour strike) for any length of time may have a
significant impact on the Company's ability to sell its products in a
particular province and/or market.

Supply chain interruptions, including a manufacturing or inventory
disruption, could impact product quality and availability. The Company
adheres to a comprehensive suite of quality programs and proactively
manages production and supply chains to mitigate any potential risk to
consumer safety or Corby's reputation and profitability.

Environmental Compliance

Environmental liabilities may potentially arise when companies are in
the business of manufacturing products and, thus, required to handle
potentially hazardous materials. As Corby outsources its production,
including all of its storage and handling of maturing alcohol, the risk
of environmental liabilities is considered minimal. Corby currently has
no significant recorded or unrecorded environmental liabilities.

Industry Consolidation

In recent years, the global beverage alcohol industry has experienced a
significant amount of consolidation. Industry consolidation can have
varying degrees of impact and, in some cases, may even create
exceptional opportunities. Either way, management believes that the
Company is well positioned to deal with this or other changes to the
competitive landscape in Canada.

Competition

The Canadian beverage alcohol industry is extremely competitive.
Competitors may take actions to establish and sustain a competitive
advantage through advertising and promotion and pricing strategies in
an effort to maintain market share. Corby constantly monitors the
market and adjusts its own strategies as appropriate. Competitors may
also affect Corby's ability to attract and retain high-quality
employees. The Company's long heritage attests to Corby's strong
foundation and successful execution of its strategies. Being a leading
Canadian beverage alcohol company helps facilitate recruitment efforts.

Credit Risk

Credit risk arises from deposits in cash management pools held with PR
via Corby's participation in the Mirror Netting Service Agreement (as
previously described in the "Related Party Transactions" section of
this MD&A), as well as credit exposure to customers, including
outstanding accounts and note receivable. The maximum exposure to
credit risk is equal to the carrying value of the Company's financial
assets. The objective of managing counter-party credit risk is to
prevent losses in financial assets. The Company assesses the credit
quality of its counter-parties, taking into account their financial
position, past experience and other factors. As the large majority of
Corby's accounts receivable balances are collectable from
government-controlled LBs, management believes the Company's credit
risk relating to accounts receivable is at an acceptably low level. The
Company's note receivable is secured.

Exposure to Interest Rate Fluctuations

The Company does not have any short- or long-term debt facilities.
Interest rate risk exists, as Corby earns market rates of interest on
its deposits in cash management pools and also has a note receivable
that earns a fixed rate of interest. An active risk management program
does not exist, as management believes that changes in interest rates
would not have a material impact on Corby's financial position over the
long term.

Exposure to Commodity Price Fluctuations

Commodity risk exists, as the manufacture of Corby's products requires
the procurement of several known commodities, such as grains, sugar and
natural gas. The Company strives to partially mitigate this risk
through the use of longer-term procurement contracts where possible. In
addition, subject to competitive conditions, the Company may pass on
commodity price changes to consumers through pricing over the long
term.

Foreign Currency Exchange Risk

The Company has exposure to foreign currency risk, as it conducts
business in multiple foreign currencies; however, its exposure is
primarily limited to the US dollar ("USD") and UK pound sterling
("GBP"). Corby does not utilize derivative instruments to manage this
risk. Subject to competitive conditions, changes in foreign currency
rates may be passed on to consumers through pricing over the long term.

USD Exposure

The Company's demand for USD has traditionally outpaced its supply, due
to USD sourcing of production inputs exceeding that of the Company's
USD sales. Therefore, decreases in the value of the Canadian dollar
("CAD") relative to the USD will have an unfavourable impact on the
Company's earnings.

GBP Exposure

The Company's exposure to fluctuations in the value of the GBP relative
to the CAD was reduced as both sales and cost of production are
denominated in GBP. While Corby's exposure has been minimized,
increases in the value of the CAD relative to the GBP will have an
unfavourable impact on the Company's earnings.

Third-Party Service Providers

HWSL, which Corby manages on behalf of PR, provides more than 80% of the
Company's production requirements, among other services including
administration and information technology. However, the Company is
reliant upon certain third-party service providers in respect of
certain of its operations. It is possible that negative events
affecting these third-party service providers could, in turn,
negatively impact the Company. While the Company has no direct control
over how such third parties are managed, it has entered into
contractual arrangements to formalize these relationships. In order to
minimize operating risks, the Company actively monitors and manages its
relationships with its third-party service providers.

Brand Reputation and Trademark Protection

The Company promotes nationally branded, non-proprietary products as
well as proprietary products. Damage to the reputation of any of these
brands, or to the reputation of any supplier or manufacturer of these
brands, could negatively impact consumer opinion of the Company or the
related products, which could have an adverse impact on the financial
performance of the Company. The Company strives to mitigate such risks
by selecting only those products from suppliers that strategically
complement Corby's existing brand portfolio and by actively monitoring
brand advertising and promotion activities. The Company registers
trademarks, as applicable, while constantly watching for and responding
to competitive threats, as necessary.

Valuation of Goodwill and Intangible Assets

Goodwill and intangible assets account for a significant amount of the
Company's total assets. Goodwill and intangible assets are subject to
impairment tests that involve the determination of fair value. Inherent
in such fair value determinations are certain judgments and estimates
including, but not limited to, projected future sales, earnings and
capital investment; discount rates; and terminal growth rates. These
judgments and estimates may change in the future due to uncertain
competitive market and general economic conditions, or as the Company
makes changes in its business strategies. Given the current state of
the economy, certain of the aforementioned factors affecting the
determination of fair value may be impacted and, as a result, the
Company's financial results may be adversely affected.

The following chart summarizes Corby's goodwill and intangible assets
and details the amounts associated with each brand (or basket of
brands) and market:

��

Carrying Values as at September 30, 2012

��

Associated Brand

��

Associated Market

��

Goodwill

��

Intangibles

��

Total

��

Various PR brands

��

Canada

��

�� -

��

40.8

��

40.8

Lamb's rum

��

United Kingdom⁽¹⁾

��

1.4

��

11.8

��

13.2

Corby domestic brands

��

Canada��

��

1.9

��

1.9

��

3.3

��

52.6

��

55.9

��

⁽¹⁾ The international business for Lamb's rum is primarily focused in the
UK, however, the trademarks and��licences purchased, relate to all
international markets outside of Canada, as Corby previously owned the
Canadian rights.

��

Therefore, economic factors (such as consumer consumption patterns)
specific to these brands and markets are primary drivers of the risk
associated with their respective goodwill and intangible assets
valuations.

Employee Future Benefits

The Company has certain obligations under its registered and
non-registered defined benefit pension plans and other post-retirement
benefit plan. There is no assurance that the Company's benefit plans
will be able to earn the assumed rate of return. New regulations and
market-driven changes may result in changes in the discount rates and
other variables, which would result in the Company being required to
make contributions in the future that differ significantly from
estimates. An extended period of depressed capital markets and low
interest rates could require the Company to make contributions to these
plans in excess of those currently contemplated, which, in turn, could
have an adverse impact on the financial performance of the Company.
Somewhat mitigating the impact of a potential market decline is the
fact that the Company monitors its pension plan assets closely and
follows strict guidelines to ensure that pension fund investment
portfolios are diversified in-line with industry best practices. For
further details related to Corby's defined benefit pension plans,
please refer to Note 15 of the consolidated financial statements for
the year ended June 30, 2012.

CORBY DISTILLERIES LIMITED

��

INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

��

(Unaudited)

��

(in thousands of Canadian dollars)

��

Sept. 30,

��

June 30,

��

Sept. 30,

��

Note

��

2012

��

2012

��

2011

��

ASSETS

��

Deposits in cash management pools

��

�� 112,920

��

110,113

��

106,244

Accounts receivable

��

30,126

��

28,611

��

29,171

Inventories

��

47,040

��

47,760

��

58,578

Prepaid expenses

��

280

��

555

��

1,607

Current portion of note receivable

��

600

��

600

��

600

Assets held for sale

��

11,060

��

Total current assets

��

190,966

��

187,639

��

207,260

Note receivable

��

1,200

��

1,200

��

1,800

Deferred income taxes

��

1,604

Property and equipment

��

7,245

��

7,524

��

6,754

Goodwill

��

3,278

��

3,278

��

3,278

Intangible assets

��

52,639

��

53,771

��

57,169

��

Total assets

��

255,328

��

253,412

��

��277,865

��

LIABILITIES

��

Accounts payable and accrued liabilities

��

�� 24,430

��

�� 22,400

��

18,696

Income and other taxes payable

��

712

��

3,656

��

433

Liabilities held for sale

��

1,201

��

Total current liabilities

��

25,142

��

26,056

��

20,330

Provision for pensions

��

10,719

��

10,550

��

12,822

Deferred income taxes

��

923

��

983

��

Total liabiliites

��

36,784

��

37,589

��

33,152

��

Shareholders' equity

��

Share capital

��

14,304

��

14,304

��

14,304

Retained earnings

��

204,240

��

201,519

��

230,409

��

Total shareholders' equity

��

218,544

��

215,823

��

244,713

��

Total liabilities and shareholders' equity

��

255,328

��

��253,412

��

277,865

��

CORBY DISTILLERIES LIMITED

��

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS ��

��

(Unaudited)

��

(in thousands of Canadian dollars, except per share amounts)

��

For the Three Months Ended

��

Sept. 30,

��

Sept. 30,

��

Note

��

2012

��

2011

��

Revenue

��

35,940

��

44,223

��

Cost of sales

��

(14,038)

��

(19,378)

Marketing, sales and administration

��

(12,413)

��

(11,921)

Other income and expense

��

(18)

��

(311)

��

Earnings from operations

��

9,471

��

12,613

��

Financial income

��

452

��

495

Financial expenses

��

(137)

��

(162)

Net financial income

��

315

��

333

��

Earnings before income taxes

��

9,786

��

12,946

��

Current income taxes

��

(2,855)

��

(3,633)

Deferred income taxes

��

147

Income taxes

��

(2,795)

��

(3,486)

��

Net earnings

��

6,991

��

9,460

��

Basic earnings per share

��

0.25

��

0.33

Diluted earnings per share

��

�� 0.25

��

0.33

��

Weighted average common shares outstanding

��

Basic

��

28,468,856

��

28,468,856

Diluted

��

28,468,856

��

28,468,856

��

��	��	��	��	��	��	��
��	��	��	��	��	��	��
CORBY DISTILLERIES LIMITED	��	��	��	��	��	��
INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
��	��	��	��	��	��	��
(Unaudited)	��	��	��	��	��	��
(in thousands of Canadian dollars)	��	��	��	��	��	��
��	��	��	��	��	��	��
��	��	��	��	��	For the Three Months Ended
��	��	��	��	��	��	��	��	��	��
��	��	��	��	��	Sept 30,	��	��	��	Sept 30,
��	��	��	��	��	2012	��	��	��	2011
��	��	��	��	��	��	��	��	��	��
Net earnings	��	��	��	��$	�� 6,991	��	��	��$	9,460
��	��	��	��	��	��	��	��	��	��
Other comprehensive income	��	��	��	��	-	��	��	��	-
��	��	��	��	��	��	��	��	��	��
Total comprehensive income	��	��	��	$	��6,991	��	��	$	9,460

��

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS'
EQUITY

��

(Unaudited)

��

(in thousands of Canadian dollars)

��

Note

��

Share Capital

��

Accumulated

Other

Comprehensive

Income

��

Retained

Earnings

��

Total

��

Balance as at July 1, 2012

��

�� 14,304

��

201,519

��

215,823

Net earnings

��

6,991

��

6,991

Other comprehensive income

��

Dividends

��

(4,270)

��

(4,270)

��

Balance as at September 30, 2012

��

14,304

��

204,240

��

218,544

��

Balance as at July 1, 2011

��

�� 14,304

��

224,935

��

239,239

Net earnings

��

9,460

��

9,460

Other comprehensive income

��

Dividends

��

(3,986)

��

(3,986)

��

Balance as at September 30, 2011

��

14,304

��

230,409

��

244,713

��

CORBY DISTILLERIES LIMITED

��

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW ��

��

(Unaudited)

��

(in thousands of Canadian dollars)

��

For the Three Months Ended

��

Sept. 30,

��

Sept. 30,

��

Notes

��

2012

��

2011

��

Operating activities

��

Net earnings

��

�� 6,991

��

9,460

Adjustments for:

��

Amortization and depreciation

��

1,372

��

1,568

Net financial income

��

(315)

��

(333)

Gain on disposal of property and equipment

��

(69)

��

Income tax expense

��

2,795

��

3,486

Provision for pensions

��

152

��

10,851

��

14,333

Net change in non-cash working capital balances

��

2,020

��

2,556

Interest received

��

385

��

434

Income taxes paid

��

(6,288)

��

(3,729)

��

Net cash from operating activities

��

6,968

��

13,594

��

Investing activities

��

Additions to property and equipment

��

(46)

��

Proceeds from disposition of property and equipment

��

155

��

Deposits in cash management pools

��

(2,807)

��

(9,608)

��

Net cash used in investing activities

��

(2,698)

��

(9,608)

��

Financing activity

��

Dividends paid��

��

(4,270)

��

(3,986)

��

Net cash used in financing activity

��

(4,270)

��

(3,986)

��

Net increase in cash

��

Cash, beginning of period

��

Cash, end of period

��

�� -

��

CORBY DISTILLERIES LIMITED

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ��

(Unaudited)

(in thousands of Canadian dollars, except per share amounts)

1. GENERAL INFORMATION��

Corby Distilleries Limited ("Corby" or the "Company") is a leading
Canadian marketer of spirits and importer of wines. The Company derives
its revenues from the sale of its owned-brands in Canada and other
international markets, as well as earning commissions from the
representation of selected non-owned brands in the Canadian
marketplace. Revenues predominantly consist of sales made to each of
the provincial liquor boards in Canada.

Corby is controlled by Hiram Walker & Sons Limited ("HWSL"), which is a
wholly owned subsidiary of Pernod Ricard, S.A. ("PR"), a French public
limited company that owned 51.6% of the outstanding Voting Class A
Common Shares of Corby as at June 30, 2012.

Corby is a public company incorporated and domiciled in Canada, whose
shares are traded on the Toronto Stock Exchange. The Company's
registered address is 225 King Street West, Suite 1100, Toronto, ON M5V
3M2.

2. BASIS OF PREPARATION

Statement of compliance

These interim condensed consolidated financial statements have been
prepared in accordance with International Accounting Standard 34,
"Interim Financial Reporting" ("IAS 34"), as issued by the
International Accounting Standards Board ("IASB"). They have been
prepared using the accounting policies that were described in Note 3 to
the Company's annual consolidated financial statements as at and for
the year ended June 30, 2012, except as described in Note 3(a) to these
condensed consolidated financial statements.

These interim condensed consolidated financial statements should be read
in conjunction with the Company's 2012 annual financial statements.

These interim condensed consolidated financial statements were approved
by the Company's Board of Directors on November 7, 2012.

Functional and presentation currency

The Company's interim condensed consolidated financial statements are
presented in Canadian dollars, which is the Company's functional and
presentation currency.

Foreign currency translation

Transactions denominated in foreign currencies are translated into the
functional currency using the exchange rate applying at the transaction
date. Non-monetary assets and liabilities denominated in foreign
currencies are recognized at the historical exchange rate applicable at
the transaction date. Monetary assets and liabilities denominated in
foreign currencies are translated at the exchange rate applying at the
balance sheet date. Foreign currency differences related to operating
activities are recognized in earnings from operations for the period;
foreign currency differences related to financing activities are
recognized within net financial income.

Basis of Measurement

These interim condensed consolidated financial statements are prepared
in accordance with the historical cost model, except for certain
categories of assets and liabilities, which are measured in accordance
with other methods provided for by IFRS as described in Note 3 to the
Company's annual consolidated financial statements as at and for the
year ended June 30, 2012. Historical cost is generally based on the
fair value of the consideration given in exchange for assets.

Seasonality

The interim condensed consolidated financial statements should not be
taken as indicative of the performance to be expected for the full year
due to the seasonal nature of the spirits business. Corby's operations
are subject to seasonal fluctuations as sales are typically strong in
the first and second quarters, while third-quarter sales usually
decline after the end of the retail holiday season. Fourth-quarter
sales typically increase again with the onset of warmer weather as
consumers tend to increase their purchasing levels during the summer
season.

Use of Estimates and Judgements��

The preparation of the interim condensed consolidated financial
statements in conformity with IFRS requires management to make certain
judgements, estimates and assumptions that affect the application of
accounting policies, the reported amounts of assets and liabilities,
disclosure of contingent assets and liabilities at the date of the
consolidated financial statements, and the reported amounts of revenues
and expenses during the reporting period. These estimates are made on
the assumption the Company will continue as a going concern and are
based on information available at the time of preparation. Estimates
may be revised where the circumstance on which they were based change
or where new information becomes available. Future outcomes can differ
from these estimates.

Judgement is commonly used in determining whether a balance or
transaction should be recognized in the consolidated financial
statements and estimates and assumptions are more commonly used in
determining the measurement of recognized transactions and balances.
However, judgement and estimates are often interrelated.

The Company has applied judgement in determining the tax rates used for
measuring deferred taxes and identifying the indicators of impairment
for property and equipment, goodwill and intangible assets. In the
absence of standards or interpretations applicable to a specific
transaction, management uses its judgement to define and apply
accounting policies that provide relevant and reliable information in
the context of the preparation of the financial statements.

Estimates are used when estimating the useful lives of property and
equipment and intangible assets for the purpose of depreciation and
amortization, when accounting for or measuring items such as allowances
for uncollectible accounts receivable and inventory obsolescence,
assumptions underlying the actuarial determination of provision for
pensions, income and other taxes, provisions, certain fair value
measures including those related to the valuation of share-based
payments and financial instruments, and when testing goodwill,
intangible assets and other assets for impairment. Actual results may
differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognized in the period in which
the estimates are revised and in any future periods affected.

3. SIGNIFICANT ACCOUNTING POLICIES

(a)��New accounting standards

(i)��Deferred Taxes - Recovery of Underlying Assets

(ii)��Financial Instruments - Disclosures

(b)��Recent accounting pronouncements

(i)��Consolidated Financial Statements

(ii) Fair Value Measurement

(iii)��Employee Benefits

(iv)��Financial Instruments - Asset and Liability Offsetting

(v)��Financial Instruments

4. ACCOUNTS RECEIVABLE

��

Sept. 30,

��

June 30,

��

Sept. 30,

��

2012

��

2012

��

2011

��

Trade receivables

��

��$

18,720

��

19,722

��

19,890

Due from related parties

��

11,346

��

8,852

��

7,860

Other receivables

��

1,421

��

�� 30,126

��

28,611

��

29,171

As at September 30, 2011, other receivables included amounts owing from
Brick Brewing Co., Limited for inventory transferred as part of the
sale of the Seagram Coolers brand on March 15, 2011, and also includes
interest accrued on the secured promissory note receivable also due
from Brick Brewing Co., Limited as described in Note 6 of these
financial statements. The amount owing from Brick related to inventory
was paid in full during the year ended June 30, 2012. For additional
information regarding the sale of the Seagram Coolers brand, please
refer to Note 19 of the most recently prepared annual consolidated
financial statements for the year ended June 30, 2012.

5. INVENTORIES

��

Sept. 30,

��

June 30,

��

Sept. 30,

��

2012

��

2012

��

2011

��

Raw materials

��

1,969

��

1,597

��

5,414

Work-in-progress

��

38,759

��

40,703

��

44,478

Finished goods

��

6,312

��

5,460

��

8,686

��

��47,040

��

��47,760

��

��58,578

��

The cost of inventory recognized as an expense and included in cost of
goods sold for the three months ended September 30, 2012 was $11,354
(2011 - $16,695). During the three month periods ended September 30,
2012 and 2011, the Company did not record any significant write-downs
of inventory as a result of net realizable value being lower than cost.
During the three month periods ending September 30, 2012 and 2011, the
Company did not reverse any significant inventory write-downs
recognized in previous periods.

6. NOTE RECEIVABLE

��

Sept. 30,

��

June 30,

��

Sept. 30,

��

2012

��

2012

��

2011

��

Note receivable

��

�� 1,800

��

1,800

��

2,400

Less: current portion

��

600

��

600

��

600

��

�� 1,200

��

1,200

��

1,800

��

As part of the Company's sale of the Seagram Coolers brand on March 15,
2011, the purchase price was satisfied in part by a promissory note
secured by specific property and issued by the purchaser in favour of
Corby for $2,400, which will be paid in equal annual instalments of
$600 plus interest of 5% per annum, with the final payment due January
31, 2015.�� For additional information regarding this disposal
transaction, please refer to Note 19 of the most recently prepared
annual consolidated financial statements for the year ended June 30,
2012.

7. ASSETS HELD FOR SALE

On September 27, 2011, the Company announced that it had entered into an agreement to sell
certain owned-brands as well as the shares of its wholly-owned
subsidiary that owns the manufacturing and bottling facility located in
Montr��al, Qu��bec. The transaction closed on October 31, 2011.��The
transaction involved the sale of 17 brands, as well as the
Montr��al-based manufacturing facility where a significant portion of
the brands are produced. The assets and liabilities associated with
this transaction have been presented as assets and liabilities held for
sale in the statement of financial position at September 30, 2011.

At September 30, 2011, the disposal group classified as held for sale
comprised of the following:

Property, plant and equipment	��	��	��	$	8,452
Goodwill ��	��	��	��	��	2,608
��	��	��	��	��	��
Assets classifed as held for sale	��	��	��	$	��11,060
��	��	��	��	��	��
��	��	��	��	��	��
Deferred income tax liabiities related to assets held for sale	��	��	��	$	1,201
��	��	��	��	��	��
Liabilities classified as held for sale	��	��	��	$	1,201

��

8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

��

Sept. 30,

��

June 30,

��

Sept. 30,

��

2012

��

2012

��

2011

��

Trade payables and accruals

��

19,425

��

16,584

��

��13,340

Due to related parties

��

5,005

��

5,816

��

5,356

��

�� 24,430

��

22,400

��

18,696

��

9. REVENUE

The Company's revenue consists of the following streams:

��	��	��	��	��
��	��	��	��	Three months ended
��	��	��	��	Sept. 30,	��	��	��	Sept. 30,
��	��	��	��	2012	��	��	��	2011
��	��	��	��	��	��	��	��	��
Case good sales ��	��	��	$	28,520	��	��	$	�� 31,037
Commissions (net of amortization of representation rights)	��	��	��	4,289	��	��	��	4,682
Other services ��	��	��	��	3,131	��	��	��	8,504
��	��	��	��	��	��	��	��	��
��	��	��	$	35,940	��	��	��$	44,223

��

Commissions are shown net of long-term representation rights
amortization of $1,133, (2011 - $1,133). Other services include
revenues incidental to the manufacture of case goods, logistics fees
and miscellaneous bulk spirit sales (the comparative period also
includes contract bottling revenues).

10. OTHER INCOME AND EXPENSE

The Company's other income (expense) consist of the following amounts:

��	��	��	��	��
��	��	��	��	Three months ended
��	��	��	��	Sept. 30,	��	��	��	Sept. 30,
��	��	��	��	2012	��	��	��	2011
��	��	��	��	��	��	��	��	��
Foreign exchange gains��	��	��	$	�� 17	��	��	$	81
Selling costs related to assets held for sale	��	��	��	-	��	��	��	(404)
Gains on disposal of property and equipment	��	��	��	69	��	��	��	-
Amortization of actuarial (losses) gains under defined benefit plans	��	��	��	(104)	��	��	��	12
��	��	��	��	��	��	��	��	��
��	��	��	$	�� (18)	��	��	$	(311)

��

11. NET FINANCIAL INCOME

The Company's financial income (expense) consists of the following
amounts:

��	��	��	��	��	��
��	��	��	��	��	Three months ended
��	��	��	��	��	Sept. 30,	��	��	��	Sept. 30,
��	��	��	��	��	2012	��	��	��	2011
��	��	��	��	��	��	��	��	��	��
Interest income	��	��	��	��$	452	��	��	��$	495
Interest expense	��	��	��	��	(44)	��	��	��	(13)
Net financial impact of pensions	��	��	��	��	(93)	��	��	��	(149)
��	��	��	��	��	��	��	��	��	��
��	��	��	��	$��	315	��	��	��$	333

��

12. EXPENSES BY NATURE

Earnings from operations include depreciation and amortization, as well
as personnel expenses as follows:

��	��	��	��	��
��	��	��	��	Three months ended
��	��	��	��	Sept. 30,	��	��	��	��	Sept. 30,
��	��	��	��	2012	��	��	��	��	2011
��	��	��	��	��	��	��	��	��	��
Depreciation of property and equipment	��	��	$	�� 239	��	��	��	$	435
Amortization of intangible assets	��	��	��	1,133	��	��	��	��	1,133
Salary and payroll costs ��	��	��	��	4,953	��	��	��	��	6,144
Expenses related to pensions and benefits	��	��	��	574	��	��	��	��	491
��	��	��	��	��	��	��	��	��	��
��	��	��	$	6,899	��	��	��	$	8,203

��

13. NET CHANGE IN NON-CASH WORKING CAPITAL BALANCES

��	��	��	��	��
��	��	��	��	Three months ended
��	��	��	��	Sept. 30,	��	��	��	Sept. 30,
��	��	��	��	2012	��	��	��	2011
��	��	��	��	��	��	��	��	��
Accounts receivable ��	��	��	$	(1,515)	��	��	��$	1,834
Inventories ��	��	��	��	720	��	��	��	1,076
Prepaid expenses ��	��	��	��	275	��	��	��	124
Income tax and other taxes recoverable / payable	��	��	��	489	��	��	��	318
Accounts payable and accrued liabilities	��	��	��	2,051	��	��	��	(796)
��	��	��	��	��	��	��	��	��
��	��	��	$	2,020	��	��	$	2,556

��

14. DIVIDENDS

On November 7, 2012, subsequent to the quarter ended September 30, 2012,
the Board of Directors declared a regular quarterly dividend of $0.17
per common share, payable December 14, 2012, to shareholders of record
as at the close of business on November 30, 2012. The Board of
Directors also declared a special dividend of $0.54 per common share,
payable January 10, 2013, to shareholders of record as at the close of
business on December 14, 2012. The dividends are in accordance with the
Company's dividend policy.

15. RELATED PARTY TRANSACTIONS

Transactions with parent, ultimate parent, and affiliates

The majority of Corby's issued and outstanding voting Class A shares are
owned by HWSL. HWSL is a wholly-owned subsidiary of PR. Therefore, HWSL
is Corby's parent and PR is Corby's ultimate parent. Affiliated
companies are subsidiaries which are controlled by Corby's parent
and/or ultimate parent.

On November 9, 2011, the Company announced that it has entered into an
agreement with PR for a new term for Corby's exclusive right to
represent ABSOLUT vodka and Plymouth gin brands in Canada from
September 30, 2013 to September 29, 2021, which is consistent with the
term of Canadian representation for the other PR brands in Corby's
portfolio. Under the agreement, Corby will pay the present value of $10
million for the additional eight years of the new term to PR at its
commencement.

Effective as of July 1, 2012, the Company entered into a five year
agreement with Pernod Ricard USA, LLC ("PR USA"), an affiliated
company, which provides PR USA the exclusive rights to represent
Wiser's Canadian whisky and Polar Ice vodka in the US. Previously,
Wiser's Canadian whisky and Polar Ice vodka were represented by an
unrelated third party in this market. The agreement is effective for a
five year period ending June 30, 2017. Since the agreement with PR USA
is a related party transaction between Corby and PR USA, the agreement
was approved by the Independent Committee of the Board of Directors of
Corby following an extensive review, in accordance with Corby's related
party transaction policy.

Related party transactions are recorded at the exchange amount.
Transactions between Corby and its parent, ultimate parent and
affiliates during the period are as follows:

��	��	��	��	��
��	��	��	��	Three months ended
��	��	��	��	Sept. 30,	��	��	��	Sept. 30,
��	��	��	��	2012	��	��	��	2011
��	��	��	��	��	��	��	��	��
Sales to related parties ��	��	��	��	��	��	��	��	��
Commissions - parent, ultimate parent and affiliated companies	��	��	$	�� 4,755	��	��	$	�� 4,861
Blending and bottling services - parent	��	��	��	-	��	��	��	184
Products for resale at an export level - affiliated companies	��	��	��	766	��	��	��	129
Bulk spirits - parent ��	��	��	��	3	��	��	��	113
��	��	��	��	��	��	��	��	��
��	��	��	$	�� 5,524	��	��	$	�� 5,287
��	��	��	��	��	��	��	��	��
Cost of goods sold, purchased from related parties	��	��	��	��	��	��	��	��
Distilling, blending, and production services - parent��	��	��	$	5,056	��	��	$	4,421
Bulk spirits - parent ��	��	��	��	-	��	��	��	552
��	��	��	��	��	��	��	��	��
��	��	��	$	5,056	��	��	$	�� 4,973
��	��	��	��	��	��	��	��	��
Administrative services purchased from related parties	��	��	��	��	��	��	��	��
Marketing, selling and administraton services- parent	��	��	$	511	��	��	$	511

��

Balances outstanding with related parties are due within 60 days, are to
be settled in cash and are unsecured.

Corby has a number of defined benefit pension plans; contributions to
these plans totaled $330 for the three month period ending September
30, 2012 (2011 - $322).

During the three month period ending September 30, 2012, Corby sold
casks to its parent company for net proceeds of $150 (2011 - $nil).

Deposits in cash management pools

Corby participates in a cash pooling arrangement under the Mirror
Netting Service Agreement together with PR's other Canadian affiliates,
the terms of which are administered by The Bank of Nova Scotia. The
Mirror Netting Services Agreement acts to aggregate each participant's
net cash balance for the purposes of having a centralized cash
management function for all of PR's Canadian affiliates, including
Corby.

As a result of Corby's participation in this agreement, Corby's credit
risk associated with its deposits in cash management pools is
contingent upon PR's credit rating. PR's credit rating as at November
7, 2012, as published by Standard & Poor's and Moody's, was BBB- and
Baa3, respectively. PR compensates Corby for the benefit it receives
from having the Company participate in the Mirror Netting Services
Agreement by paying interest to Corby based upon the 30-day LIBOR rate
plus 0.40%. During the three month period ending September 30, 2012,
Corby earned interest income of $430 from PR (2011 - $387). Corby has
the right to terminate its participation in the Mirror Netting Services
Agreement at any time, subject to five days' written notice.

16. SEGMENT INFORMATION

Corby has two reportable segments: Case Goods and Commissions. Corby's
Case Goods segment derives its revenue from the production and
distribution of its owned beverage alcohol brands. Corby's portfolio of
owned-brands includes some of the most renowned and respected brands in
Canada, such as Wiser's Canadian whisky, Lamb's rum, Polar Ice vodka,
and McGuinness liqueurs.

Corby's Commissions segment earns commission income from the
representation of non-owned beverage alcohol brands in Canada. Corby
represents leading international brands such as ABSOLUT vodka, Chivas
Regal, The Glenlivet and Ballantine's scotches, Jameson Irish whiskey,
Beefeater gin, Malibu rum, Kahl��a liqueur, Mumm champagne, and Jacob's
Creek and Wyndham Estate wines.

The Commissions segment's financial results are fully reported as
"Commissions" in Note 9 of these consolidated statements. Therefore, a
chart detailing operational results by segment has not been provided as
no additional meaningful information would result.

17. SUBEQUENT EVENTS

On November 7, 2012, subsequent to the first quarter ended September 30,
2012, the Board of Directors of Corby declared a special dividend in
the amount of $0.54 per common share. This dividend will be paid on
January 10, 2012, on Voting Class A Common Shares and Non-voting Class
B Common Shares of the Company to shareholders of record as at the
close of business on December 14, 2012. This dividend will be in
addition to Corby's regular dividend of $0.17 per share which was also
declared by the Corby's Board of Directors on the same day. The special
dividend will result in a cash distribution of approximately $15.4
million to shareholders and will be sourced from the Company's current
surplus cash deposits.

��

SOURCE: Corby Distilleries Limited

For further information:

CORBY DISTILLERIES LIMITED
John Leburn, Vice-President and Chief Financial Officer
Tel.: 416-479-2400
investors@corby.ca
www.Corby.ca

Canada Dividend Investor

Wednesday, November 7, 2012

CDL.A - /CORRECTION from Source -- Corby Distilleries Limited/ (CAD 0.54)

No comments:

Post a Comment