LE CHÂTEAU REPORTS THIRD QUARTER RESULTS Continued improvement in Adjusted EBITDA and in Store Network Recalibration

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PRESS RELEASE LE CHÂTEAU REPORTS THIRD QUARTER RESULTS Continued improvement in Adjusted EBITDA and in Store Network Recalibration Montréal, December 8, 2017 Le Château Inc. (TSX VENTURE: CTU), today reported that sales for the third quarter ended October 28, 2017 amounted to $48.7 million as compared with $55.4 million for the third quarter ended October 29, 2016, a decrease of 12.1%, with 26 fewer stores in operation. Comparable store sales decreased 5.6% for the third quarter as compared to last year, with comparable regular store sales decreasing 5.7% and comparable outlet store sales decreasing 5.4% (see non-gaap measures below). Included in comparable store sales are online sales which increased 14.0% for the third quarter. The unseasonably warm weather during the third quarter negatively impacted the sales of Fall warmwear product while special occasion categories continued to perform well. Adjusted EBITDA (see non-gaap measures below) for the third quarter of 2017 amounted to $(2.5) million, compared to $(3.3) million for the same period last year. The improvement of $735,000 in adjusted EBITDA for the third quarter was primarily attributable to the reduction of $4.9 million in selling, general and administrative ( SG&A ) expenses, partially offset by the decrease in gross margin dollars of $4.2 million. The decrease in SG&A expenses resulted primarily from the reduction in store operating expenses due mainly to store closures. The decrease of $4.2 million in gross margin dollars was the result of the 12.1% overall sales decline for the third quarter of 2017, partially offset by an increase in the gross margin percentage to 63.8% from 63.6% in 2016. The gross margin percentage improved slightly, despite the temporary aggressive promotional activity related to store closures, and reflects the improved product mix considering our effort to achieve a lower and better quality inventory level. The improvement in third quarter adjusted EBITDA when compared to last year largely reflects the declining proportion of non-core stores within the network as a whole, partially offset by aggressive promotional activities related to on-going store closures. For the current fiscal year, due in part to some lease exit opportunities, the planned number of store closures increased from 21 to 25 stores. The Company continues to make further progress in its strategy to recalibrate its retail network, by closing underperforming stores and further strengthening its growing e-commerce platform. Net loss for the third quarter ended October 28, 2017 amounted to $7.1 million or $(0.24) per share compared to a net loss of $8.0 million or $(0.27) per share for the same period last year. Nine-month Results Sales for the nine months ended October 28, 2017 amounted to $148.4 million as compared with $164.0 million last year, a decrease of 9.5%, with 26 fewer stores in operation. Comparable store sales decreased 3.0% versus the same period a year ago, with comparable regular store sales decreasing 1.7% and comparable outlet store sales decreasing 7.9%. Included in comparable store sales are online sales which increased 18.6% for the nine months ended October 28, 2017. Adjusted EBITDA for the nine months ended October 28, 2017 amounted to $(7.1) million, compared to $(13.4) million last year. The improvement of $6.3 million in adjusted EBITDA for the first nine months of 2017 was primarily attributable to the reduction of $13.7 million in SG&A expenses, partially offset by the decrease in gross margin dollars of $7.4 million. The decrease in SG&A expenses resulted primarily from the reduction in store operating expenses due mainly to store closures. The decrease of $7.4 million in gross margin dollars was the result of the 9.5% overall sales decline for the first nine months of 2017, partially offset by the increase in the gross margin percentage to 64.9% from 63.3% in 2016. Net loss for the nine-month period ended October 28, 2017 amounted to $21.0 million or $(0.70) per share compared to a net loss of $28.5 million or $(0.95) per share the previous year. During the first nine months of 2017, the Company renovated one existing location and, as planned, closed 17 underperforming stores. As at October 28, 2017, the Company operated 170 stores (including 47 fashion outlet stores) compared to 196 stores (including 63 1

fashion outlet stores) as at October 29, 2016. Total square footage for the Le Château network as at October 28, 2017 amounted to 946,000 square feet (including 333,000 square feet for fashion outlet stores), compared to 1,079,000 square feet (including 422,000 square feet for fashion outlet stores) as at October 29, 2016. The Company is planning to close 8 additional stores during the remainder of 2017. Profile Le Château de Montréal is a leading Canadian specialty retailer and manufacturer of exclusively designed apparel, footwear and accessories for contemporary and style-conscious women and men, with an extensive network of 170 prime locations across Canada and a rapidly growing e-com platform servicing Canada and the U.S. Le Château, committed to research, design and product development, manufactures approximately 30% of the Company s apparel in its own Canadian production facilities. Non-GAAP Measures In addition to discussing earnings measures in accordance with IFRS, this press release provides adjusted EBITDA as a supplementary earnings measure, which is defined as earnings (loss) before interest, income taxes, depreciation, amortization, writeoff and/or impairment of property and equipment and intangible assets and accretion of First Preferred shares series 1 ( Adjusted EBITDA ). Adjusted EBITDA is provided to assist readers in determining the ability of the Company to generate cash from operations and to cover financial charges. It is also widely used for valuation purposes for public companies in our industry. The following table reconciles adjusted EBITDA to loss before income taxes for the three and nine-month periods ended October 28, 2017 and October 29, 2016: Loss before income taxes $ (7,121) $ (7,994) $ (20,961) $ (28,476) Depreciation and amortization 2,473 3,326 8,123 10,633 Write-offs and impairment of property and equipment 198 104 682 576 Finance costs 1,352 1,304 4,138 3,824 Accretion of First Preferred shares series 1 573-948 - Adjusted EBITDA $ (2,525) $ (3,260) $ (7,070) $ (13,443) The Company also discloses comparable store sales which are defined as sales generated by stores that have been open for at least one year on a comparable week basis. Comparable store sales exclude sales from stores converted to outlet or clearance stores during the year of conversion. The following table reconciles comparable store sales to total sales disclosed in the unaudited interim condensed consolidated statements of loss for the three and nine-month periods ended October 28, 2017 and October 29, 2016: Comparable store sales Regular stores $ 37,791 $ 40,070 $ 114,022 $ 116,017 Comparable store sales Outlet stores 8,791 9,294 26,980 29,295 Total comparable store sales 46,582 49,364 141,002 145,312 Non-comparable store sales 2,094 6,057 7,395 18,655 Total sales $ 48,676 $ 55,421 $ 148,397 $ 163,967 The above measures do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. 2

Forward-Looking Statements This news release may contain forward-looking statements relating to the Company and/or the environment in which it operates that are based on the Company's expectations, estimates and forecasts. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict and/or are beyond the Company's control. A number of factors may cause actual outcomes and results to differ materially from those expressed. These factors also include those set forth in other public filings of the Company. Therefore, readers should not place undue reliance on these forward-looking statements. In addition, these forward-looking statements speak only as of the date made and the Company disavows any intention or obligation to update or revise any such statements as a result of any event, circumstance or otherwise except to the extent required under applicable securities law. Factors which could cause actual results or events to differ materially from current expectations include, among other things: the ability of the Company to successfully implement its business initiatives and whether such business initiatives will yield the expected benefits; liquidity risks; competitive conditions in the businesses in which the Company participates; changes in consumer spending; general economic conditions and normal business uncertainty; seasonality and weather patterns; changes in the Company's relationship with its suppliers; lease renewals; information technology security and loss of customer data; fluctuations in foreign currency exchange rates; interest rate fluctuations and changes in laws, rules and regulations applicable to the Company. There can be no assurance that borrowings will be available to the Company, or available on acceptable terms, in an amount sufficient to fund the Company's needs or that additional financing will be provided by any of the controlling shareholders of the Company. The foregoing list of risk factors is not exhaustive and other factors could also adversely affect our results. The Company s unaudited interim condensed consolidated financial statements and Management s Discussion and Analysis for the third quarter ended October 28, 2017 are available online at www.sedar.com. For further information Emilia Di Raddo, CPA, CA, President (514) 738-7000 Johnny Del Ciancio, CPA, CA, Vice-President, Finance, (514) 738-7000 MaisonBrison: Pierre Boucher, (514) 731-0000 Source: Le Château Inc. - 30-3

CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands of Canadian dollars) As at October 28, 2017 As at October 29, 2016 As at January 28, 2017 ASSETS Current assets Cash $ 677 $ 1,014 $ 266 Accounts receivable 866 1,302 992 Income taxes refundable 389 399 459 Inventories 95,377 110,385 101,128 Prepaid expenses 1,606 1,480 1,604 Total current assets 98,915 114,580 104,449 Deposits 621 621 621 Property and equipment 29,588 41,036 36,969 Intangible assets 2,555 3,188 2,900 $ 131,679 $ 159,425 $ 144,939 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Current portion of credit facility $ 15,636 $ 65,998 $ 54,564 Trade and other payables 16,338 15,540 19,335 Deferred revenue 2,507 2,649 3,022 Current portion of provision for onerous leases 703 780 846 Current portion of long-term debt - - 1,643 Total current liabilities 35,184 84,967 79,410 Credit facility 30,373 - - Long-term debt 30,463 31,908 32,113 Provision for onerous leases 961 1,491 1,364 Deferred lease credits 7,384 8,582 8,192 First Preferred shares series 1 24,130 - - Total liabilities 128,495 126,948 121,079 Shareholders' equity Share capital 47,967 47,967 47,967 Contributed surplus 9,572 9,154 9,287 Deficit (54,355) (24,644) (33,394) Total shareholders' equity 3,184 32,477 23,860 $ 131,679 $ 159,425 $ 144,939 4

CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (In thousands of Canadian dollars, except per share information) October 28, 2017 October 29, 2016 October 28, 2017 October 29, 2016 Sales $ 48,676 $ 55,421 $ 148,397 $ 163,967 Cost of sales and expenses Cost of sales 17,621 20,177 52,067 60,249 Selling 29,024 33,716 89,277 104,038 General and administrative 7,227 8,218 22,928 24,332 53,872 62,111 164,272 188,619 Results from operating activities (5,196) (6,690) (15,875) (24,652) Finance costs 1,352 1,304 4,138 3,824 Accretion of First Preferred shares series 1 573-948 - Loss before income taxes (7,121) (7,994) (20,961) (28,476) Income tax recovery - - - - Net loss and comprehensive loss $ (7,121) $ (7,994) $ (20,961) $ (28,476) Net loss per share Basic $ (0.24) $ (0.27) $ (0.70) $ (0.95) Diluted (0.24) (0.27) (0.70) (0.95) Weighted average number of shares outstanding ('000) 29,964 29,964 29,964 29,964 CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY SHARE CAPITAL $ 47,967 $ 47,967 $ 47,967 $ 47,967 CONTRIBUTED SURPLUS Balance, beginning of period $ 9,529 $ 9,088 $ 9,287 $ 8,555 Fair value adjustment of long-term debt - - 99 347 Stock-based compensation expense 43 66 186 252 Balance, end of period $ 9,572 $ 9,154 $ 9,572 $ 9,154 DEFICIT Balance, beginning of period $ (47,234) $ (16,650) $ (33,394) $ 3,832 Net loss (7,121) (7,994) (20,961) (28,476) Balance, end of period $ (54,355) $ (24,644) $ (54,355) $ (24,644) Total shareholders equity $ 3,184 $ 32,477 $ 3,184 $ 32,477 5

CONSOLIDATED STATEMENTS OF CASH FLOWS OPERATING ACTIVITIES Net loss $ (7,121) $ (7,994) $ (20,961) $ (28,476) Adjustments to determine net cash from operating activities Depreciation and amortization 2,473 3,326 8,123 10,633 Write-offs and impairment of property and equipment 198 104 682 576 Amortization of deferred lease credits (238) (484) (1,211) (1,156) Deferred lease credits - 225 403 225 Stock-based compensation 43 66 186 252 Provision for onerous leases (235) (72) (546) 198 Finance costs 1,352 1,304 4,138 3,824 Accretion of First Preferred shares series 1 573-948 - Interest paid (928) (564) (2,195) (2,272) (3,883) (4,089) (10,433) (16,196) Net change in non-cash working capital items related to operations (2,447) 156 963 (821) Income taxes refunded - - 250 300 Cash flows related to operating activities (6,330) (3,933) (9,220) (16,717) FINANCING ACTIVITIES Increase (decrease) in credit facility 6,683 5,257 (7,767) 20,912 Financing costs (17) - (1,023) - Proceeds from long-term debt - - 19,500 2,500 Repayment of long-term debt - (286) - (848) Cash flows related to financing activities 6,666 4,971 10,710 22,564 INVESTING ACTIVITIES Additions to property and equipment and intangible assets (174) (1,733) (1,679) (4,288) Proceeds from disposal of property and equipment - - 600 - Cash flows related to investing activities (174) (1,733) (1,079) (4,288) Increase (decrease) in cash 162 (695) 411 1,559 Cash (bank indebtedness), beginning of period 515 1,709 266 (545) Cash, end of period $ 677 $ 1,014 $ 677 $ 1,014 6