Diversified Restaurant Holdings Reports 4.2% Increase in Preliminary Same Store Sales for First Quarter 2019

Comparable sales trends accelerated in the month of March at a
positive 8.0%

DRH announced that its franchisor exercised its right of first
refusal on planned acquisition

SOUTHFIELD, Mich.–(BUSINESS WIRE)–Diversified
Restaurant Holdings, Inc.
(Nasdaq: SAUC) (“DRH” or the “Company”),
one of the largest franchisees for Buffalo Wild Wings®
(“BWW”) with 64 stores across five states, announced preliminary
unaudited sales results for the first quarter ended March 31, 2019. DRH
also announced that its franchisor, Buffalo Wild Wings, Inc., has
exercised its right of first refusal to acquire the assets of nine BWW
restaurants located in the Chicago market that were previously subject
to its Asset Purchase Agreement dated February 22, 2019.

David G. Burke, President and CEO, stated, “The sales momentum that we
enjoyed in the prior quarter has continued into 2019, with comparable
sales up 4.2% for the first quarter. After layering on the latest brand
enhancing initiatives launched in mid-March, which included a
significant strategic media and marketing push around March Madness, we
saw an additional measurable improvement in sales and traffic in March,
with comparable sales up 8.0%.”

Mr. Burke added, “While we are disappointed that our franchisor has
elected to take this transaction, we are excited about the positive
momentum in our core business and believe that it is a reflection of the
investments we have made in focusing on guest experience, loyalty
attachment and strong execution of the delivery channel. We believe
these investments, coupled with the brand enhancements being
continuously rolled out by BWW, leave DRH well positioned to achieve
strong long-term growth and earnings performance.”

Preliminary Q1 2019 Sales Results

Total revenue for the 2019 first quarter was $40.6 million, up from
$39.5 million in the first quarter of 2018, despite one fewer
restaurant. First quarter comparable sales were up 4.2%, the second
consecutive positive quarter. While sales were negatively impacted by
significant weather-related headwinds in the Company’s Midwest markets
early in the year, these impacts were largely offset by the shift in
timing of the Easter holiday from the first quarter of 2018 to the
second quarter of 2019.

Preliminary results remain subject to the completion of normal
quarter-end accounting procedures and are subject to change. The Company
expects to release financial and operating results for its first quarter
in early May.

About Diversified Restaurant Holdings, Inc.

Diversified Restaurant Holdings, Inc. is one of the largest franchisees
for Buffalo Wild Wings with 64 franchised restaurants in key markets in
Florida, Illinois, Indiana, Michigan and Missouri. DRH’s strategy is to
generate cash, reduce debt and leverage its strong franchise operating
capabilities for future growth. The Company routinely posts news and
other important information on its website at http://www.diversifiedrestaurantholdings.com.

Safe Harbor Statement

The information made available in this news release contain
forward-looking statements which reflect DRH’s current view of future
events, results of operations, cash flows, performance, business
prospects and opportunities. Wherever used, the words “anticipate,”
“believe,” “expect,” “intend,” “plan,” “project,” “will continue,” “will
likely result,” “may,” and similar expressions identify forward-looking
statements as such term is defined in the Securities Exchange Act of
1934. Any such forward-looking statements are subject to risks and
uncertainties, actual growth, results of operations, financial
condition, cash flows, performance, business prospects and opportunities
could differ materially from historical results or current expectations.
Some of these risks include, without limitation, the franchisor waiving
its right of first refusal, our ability to obtain financing for the
acquisition, the success of initiatives aimed at improving the Buffalo
Wild Wings brand, the impact of economic and industry conditions,
competition, food safety issues, store expansion and remodeling, labor
relations issues, costs of providing employee benefits, regulatory
matters, legal and administrative proceedings, information technology,
security, severe weather, natural disasters, accounting matters, other
risk factors relating to business or industry and other risks detailed
from time to time in the Securities and Exchange Commission filings of
DRH. Forward-looking statements contained herein speak only as of the
date made and, thus, DRH undertakes no obligation to update or publicly
announce the revision of any of the forward-looking statements contained
herein to reflect new information, future events, developments or
changed circumstances or for any other reason.

Contacts

Investor and Media:
Deborah K. Pawlowski
Kei Advisors
LLC
716.843.3908
dpawlowski@keiadvisors.com