Newfoundland Capital : today announces its financial results for the second quarter ending June 30, 2017

Dartmouth, N.S. - August 10, 2017, Newfoundland Capital Corporation Limited (the "Company") today announces its financial results for the second quarter ending June 30, 2017.

Highlights

• Revenue for the second quarter of $43.6 million was $0.6 million or 1% lower than the same quarter last year and year- to-date revenue of $79.3 million was $1.8 million or 2% lower than 2016. The decrease during the quarter and year-to- date was primarily due to revenue declines in the Company's Alberta and Newfoundland and Labrador operations as a result of continued economic challenges in those regions of the country and declines in Ottawa as a result of downward pressure on advertising rates in that market. These declines were partially offset by growth in the Company's Toronto and Sudbury operations, which have achieved strong listener ratings.

• Adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA"(1)) of $13.9 million in the second quarter was on par with the second quarter last year and year-to-date Adjusted EBITDA of $20.9 million was

  $1.1 million or 5% lower than 2016. Excluding the impact of a $0.4 million non-cash expense related to the extension of certain executive stock options, Adjusted EBITDA would have been 3% higher in the quarter due to the Company's focus on controlling costs and operating efficiently. The decline in Adjusted EBITDA year-to-date was a result of the revenue declines combined with the non-cash expense related to the extension of certain executive stock options.‌

• Profit for the period of $8.4 million was $0.1 million or 1% higher than the same quarter last year. Year-to-date profit of

  $11.3 million was $1.6 million or 12% lower than last year due primarily to lower revenue.

  Significant events

• In June 2017, the Company received Canadian Radio-television and Telecommunications Commission ("CRTC") approval and finalized the purchase of three radio stations in Kamloops, British Columbia.

• In June 2017, the Company received CRTC approval and finalized the sale of CISL-AM in Vancouver, British Columbia.

• Subsequent to quarter-end, the Board of Directors approved an increase in dividends to $0.50 per share per annum, up from $0.20 per share per annum. As a result, the Board of Directors declared a dividend of $0.25 per share on each of the Company's Class A Subordinate Voting Shares and Class B Common Shares, payable on September 15, 2017 to all shareholders of record as at August 31, 2017.‌

"The Company had a successful second quarter as a focus on controlling costs resulted in savings that more than offset a slight decline in broadcasting revenue," commented Rob Steele, President and Chief Executive Officer. "We are pleased with the Company's overall results as our efforts to operate efficiently have allowed us to grow margins in the Broadcasting segment compared to the same quarter last year."

Financial Highlights - S econd Quarter

Three months ended June 30

(thousands of Canadian dollars, except share information) 2017 2016 (2)

Revenue

$ 43,604

44,225

Adjusted EBITDA(1) 13,850 13,811

Profit 8,359 8,300

Earnings per share - basic 0.33 0.31

Earnings per share - diluted 0.31 0.30

Weighted average number of shares outstanding (in thousands) 25,572 26,448

June 30 December 31

2017 2016

Share price, NCC.A (closing)

$ 10.64

9.76

Total assets 373,331 372,663

Long-term debt, including current portion 122,326 129,455

Shareholders' equity 163,042 151,155

(1) As defined on page 12 "non-IFRS Accounting Measure"

(2) Restated for change in accounting policy - Profit and earnings per share for the second quarter ended June 30, 2016 have been restated as a result of the retrospective application of a change in accounting policy related to the measurement of deferred income taxes on indefinite life intangible assets. For further details, refer to note 2(c) of the interim financial statements.

MANAGEMENT'S DISCUSSION AND ANALYSIS

The purpose of the Management's Discussion and Analysis ("MD&A") is to provide readers with additional complementary information regarding the financial condition and results of operations for Newfoundland Capital Corporation Limited (the "Company") and should be read in conjunction with the unaudited condensed interim consolidated financial statements ("interim financial statements") and related notes for the periods ended June 30, 2017 and 2016, as well as the annual audited consolidated financial statements and related notes prepared in accordance with International Financial Reporting Standards ("IFRS") and the MD&A contained in the Company's 2016 Annual Report. The Company's second quarter 2017 interim financial statements and the accompanying notes have been prepared in accordance with International Accounting Standard ("IAS") 34, "Interim Financial Reporting" ("IAS 34") as issued by the International Accounting Standards Board ("IASB") and using the accounting policies described therein. These interim financial statements include the accounts of the Company and other entities in which the Company controls in accordance with IFRS 10, "Consolidated Financial Statements" and are reported in Canadian dollars. These documents along with the Company's Annual Information Form, its Management Proxy Circular dated March 9, 2017 and other public information are filed electronically with various securities commissions in Canada through the System for Electronic Document Analysis and Retrieval and can be accessed at www.sedar.com. This information is also available on the Company's website at www.ncc.ca.

The Board of Directors, upon recommendation of the Audit and Governance Committee, approved the content of this MD&A on August 10, 2017. Disclosure contained in this document is current to this date, unless otherwise stated.

Management's Discussion and Analysis of financial condition and results of operations contains forward-looking statements and forward-looking information within the meaning of Canadian provincial securities laws. These forward-looking statements are based on current expectations. The use of terminology such as "expect", "intend", "anticipate", "believe", "may", "will", "should", "would", "plan" and other similar terminology relate to, but are not limited to, objectives, goals, plans, strategies, intentions, outlook and estimates. By their very nature, these statements involve inherent risks and uncertainties, many of which are beyond the Company's control, which could cause actual results to differ materially from those expressed in such forward-looking statements. As a result, there is no guarantee that any forward-looking statements will materialize and readers are cautioned not to place undue reliance on these statements. Assumptions, expectations and estimates made in the preparation of forward-looking statements and risks that could cause our actual results to differ materially from our current expectations are discussed in detail in the Risks and Opportunities section of this MD&A. Unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Newfoundland Capital Corporation Limited owns and operates Newcap Radio, which is one of Canada's leading radio broadcasters with 101 broadcast licences (72 radio stations and 29 repeating signals) across Canada. The Company reaches millions of listeners each week through a variety of formats and is a recognized industry leader in radio programming, sales and networking. It is Canada's largest pure-play radio company, employing approximately 800 of the best radio professionals across the country. The Company's portfolio of radio assets includes 82 FM and 19 AM licences that can be heard throughout Canada. Most of the Company's stations are globally accessible via the internet and various mobile device applications, allowing listeners the flexibility to tune in at anytime from anywhere. The shares of the Company trade on the Toronto Stock Exchange under the symbols NCC.A and NCC.B.

The Company's long-term strategy is to maximize returns on existing operations and add new licences through business and licence acquisitions and through the Canadian Radio-television and Telecommunications Commission ("CRTC") licence application process.

The Company's day-to-day operating objective is to grow its existing operations by increasing advertising revenue and remaining focused on controlling costs to maximize adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") margins. Management will continue to explore acquisition and expansion opportunities that fit the Company's objectives and it will make applications to the

CRTC for new licences. The Company's commitment to its talented employees, its customers, its listeners and to the communities it serves remains critical to its success.

The following is a review of the key corporate developments that should be considered when reviewing the "Consolidated Financial Performance Review" section. The results of the acquired and launched stations have been included in the interim financial statements since their acquisition or launch dates.

• August 2017 - the Company's Board of Directors approved an increase in annual dividends to $0.50 per share from $0.20 per share previously and declared dividends of $0.25 on each of its Class A Subordinate Voting shares and Class B Common shares.

• July 2017 - rebranded all small market Alberta rock and classic hits stations as BOOM.

• June 2017 - received CRTC approval and completed its previously announced disposal of 8384886 Canada Inc., which operates CISL-AM in Vancouver, British Columbia. Results of this subsidiary were included in the Company's interim financial statements until June 30, the date of sale.

• June 2017 - received CRTC approval and completed its previously announced acquisition of three radio stations as well as four repeating signals in Kamloops, British Columbia.

• January and February 2017 - rebranded all British Columbia, New Brunswick, and Nova Scotia country stations as New Country.

• January 2017 - launched a new FM licence in Hinton, Alberta.

• November 2016 - rebranded all Alberta country stations as "Real Country", except CFCW, which will remain as its own brand as it is a well-known country brand in Alberta.

• May 2016 - launched a new FM licence in Clarenville, Newfoundland and Labrador.

• March 2016 - rebranded CKDQ in Drumheller to 910 CFCW, an extension of the Company's legendary CFCW brand, the voice of rural Alberta, which is a well-known country brand that is now available in nearly all of Alberta.

• February 2016 - rebranded CFXJ-FM in Toronto to 93.5 The Move, a rhythmic hot adult contemporary station targeting adults 25 to 44.

• February 2016 - rebranded CKUL-FM in Halifax to Mix 96.5, a hot adult contemporary station playing a variety of pop/rock hits from the 90s to now.

On June 26, 2017, the Company acquired the shares of companies that hold the radio broadcasting assets of three radio stations in Kamloops, British Columbia, for total cash consideration of $7.1 million (net of cash acquired). The acquired stations consist of CKRV-FM, CKJC-FM, and CHNL-AM as well as four repeating signals of CHNL.

Upon the close of the acquisition, the Company completed a provisional purchase price allocation. For a detailed description of this business combination, including the provisional purchase price allocation, pro-forma earnings and acquisition-related costs, please refer to note 4 of the interim financial statements.

The financial results of these stations have been included in profit since their respective acquisition date.

Consolidated Financial Results of Operations

(thousands of Canadian dollars,

except percentages and

Three months ended June 30 Six months ended June 30

(1) As defined on page 12 "non-IFRS Accounting Measure"

(2) Provision for income taxes, profit, and earnings per share for the second quarter and six months ended June 30, 3016 have been restated as a result of the retrospective application of a change in accounting policy related to the measurement of deferred income taxes on indefinite life intangible assets. For further details, refer to note 2(c) in the interim financial statements.

A detailed analysis of the variations in revenue, operating expenses and Adjusted EBITDA are included in the section entitled "Financial Review by Segment".

Revenue

In the second quarter, consolidated revenue of $43.6 million was $0.6 million or 1% lower than the same quarter last year and year-to-date revenue of $79.3 million was $1.8 million or 2% lower than 2016. The quarter and year-to-date decreases were primarily attributable to lower revenue in the Broadcasting segment, particularly the Alberta, Newfoundland and Labrador, and Ottawa operations, partially offset by growth in Toronto and Sudbury, which have achieved strong listener ratings.

Operating expenses

In the second quarter, consolidated operating expenses of $29.8 million were $0.7 million or 2% lower than the same period last year and year-to-date operating expenses of $58.4 million were $0.7 million or 1% lower than 2016. The decrease in operating expenses was primarily a result of lower operating expenses in the Broadcasting segment as the Company has focused on controlling costs to offset revenue declines. There were higher operating expenses in the Corporate and Other segment due to the extension of executive stock options, which resulted in a $0.4 million non-cash expense in the second quarter and $0.6 million year-to-date. Excluding this expense, consolidated operating expenses declined 3% during the second quarter and 2% year-to-date.

Adjusted EBITDA

In the second quarter, consolidated Adjusted EBITDA of $13.9 million was on par with the same period last year and year-to-date Adjusted EBITDA of $20.9 million was $1.1 million or 5% lower than 2016. Excluding the impact of a $0.4 million non-cash expense related to the extension of certain executive stock options, Adjusted EBITDA would have been 3% higher in the quarter due to the Company's focus on controlling costs and operating efficiently. The decline in Adjusted EBITDA year-to-date was a result of the revenue declines combined with the expense related to the extension of stock options.