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2016-05-10

The Intertain Group Limited: Intertain Announces First Quarter 2016 Financial Results, Update on Process to Enhance Shareholder Value

Record Profits and Cash Flow Generated: 70 Cents of Operating Cash Flow Per
Share in Q1 2016

TORONTO, ONTARIO--(Marketwired - May 10, 2016) -The Intertain Group Limited
("Intertain" or the "Company") (TSX:IT)(OTCQX:ITTNF) today announced its
financial results for the three months ended March 31, 2016. All amounts are
stated in Canadian dollars unless otherwise noted.

Financial Highlights:

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| |
| 3 months ended 3 months ended |
| |
| March 31, 2016 March 31, 2015 |
| ($000's) ($000's) |
| Revenue 128,526 32,792 |
| Operating cash flow 52,221 7,085 |
| Operating cash flow per share(1) $0.70 $0.19 |
| Net income/(loss) 9,964 (26,161) |
| Adjusted EBITDA(2) 55,109 9,989 |
| Adjusted Net Income(2) 46,041 8,623 |
| Net income/(loss) per share(1) $0.14 $(0.80) |
| Adjusted Net Income per share(1)(2) $0.62 $0.25 |
| |
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Q1 Financial and Subsequent Corporate Highlights

* Significantly Increased Q1 Revenue Year Over Year

Jackpotjoy generated revenues of $87.4 million in Q1 2016, representing 20%
growth year over year on a constant currency basis.

Vera&John generated revenues of $25.3 million in Q1 2016, representing 53%
growth year over year on a constant currency basis.
Mandalay generated revenues of $11.4 million in Q1 2016, representing 9%
growth year over year on a constant currency basis.

* Generated Record Profits and Cash Flow

$10 million net income, and Adjusted Net Income(2)of $46 million after
non-cash and one-time items are excluded.

70 cents of operating cash flow per share(1)and 43 cents of net cash flow per
share(1)generated in Q1 2016.

95% conversion rate from Adjusted EBITDA(2)to operating cash flow.

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| |
| (1) Per share figures are calculated on a diluted weighted average basis using the |
| IFRS treasury method. |
| (2) This release contains non-IFRS financial measures, which are noted where used. |
| For additional details, including with respect to the reconciliations from |
| these non-IFRS financial measures, please refer to the information under the |
| heading "Adjusted EBITDA and Adjusted Net Income for the Three Months Ended |
| March 31, 2016" on pages 3 - 4 of this release. |
-----------------------------------------------------------------------------------------
* Successfully Migrated and Re-Launched InterCasino

The InterCasino brand was successfully migrated and re-launched in April and
is now based on Intertain's proprietary Plain Gaming platform.

The Plain Gaming platform is currently integrated with more than 30 game
providers, offering over 1,000 web games and 400 mobile games.
More than 50% of Plain Gaming's current revenue is generated by mobile, a key
growth target for Intertain.
In addition to leveraging a proprietary platform and increasing both the
content offering and mobile access for customers, Intertain will be able to
reduce costs as it will lessen the amount it pays in licensing fees to
third-party suppliers.

"Intertain continues to outperform our expectations," said John Kennedy
FitzGerald, President and CEO of Intertain. "We remain focused on the
execution of our plans in order to continue to deliver great results and
value to our shareholders."

Update on Intertain's Special Committee Process to Enhance Shareholder Value

The Special Committee is continuing to work with Canaccord Genuity, its
financial advisor, and Osler, Hoskin&Harcourt, its independent legal advisor
in the consideration of third party proposals to acquire all of the shares or
material business units of Intertain. In recent weeks, some parties have made
preliminary offers in that regard. Other parties have been conducting due
diligence following the execution of nondisclosure agreements and have
received management presentations. The Special Committee is evaluating all
proposals on an ongoing basis and expects to provide a further update no
later than the end of June.

In parallel with these ongoing discussions and in order to ensure that the
Special Committee has explored the broadest range of potential value
enhancing alternatives, the Special Committee has retained Credit Suisse to
advise on potential advantageous scenarios including a possible migration of
Intertain to a European jurisdiction and greater exposure to European capital
markets. The Special Committee is receiving advice from appropriate experts
and professionals on the issues relating to such scenarios, and expects to
provide further updates as this analysis progresses.

The Special Committee is also progressing in its search for a new Chief
Executive Officer and Chairman of the Board of Directors of the Company (the
"Board"), as well as additional independent directors and has met several
Europe-based candidates in connection with these positions. The credentials
along with the industry experience of these candidates is impressive and the
Special Committee is well advanced with the recruitment of both the Chief
Executive Officer and Chairman of the Board and has also identified several
prospective Europe-based independent board members with whom further
discussions will be held.

David Danziger, Chairman of the Board commented, "the Board considers the
Company to be significantly undervalued and is actively exploring all options
to correct this. We are pleased by the considerable interest shown by third
parties in pursuing a value enhancing strategic transaction with Intertain.
Similarly, if we conclude that a sale is not the most advantageous option for
the business, we are confident that we will have a talented management team
to drive the strategy of Intertain going forward, particularly with the
prospect of a potential migration of Intertain and increased exposure of
Intertain to European capital markets. We continue to progress all strategic
options with the objective of timely identification of the best alternative.
Of course, the excellent financial results we have announced further confirm
the strength and continued growth of Intertain's main businesses and the
value we believe can be unlocked for the benefit of our shareholders."

Adjusted EBITDA and Adjusted Net Income for the Three Months Ended March 31,
2016(3)

------------------------------------------------------------------------------------------------------
| |
| 3 months ended 3 months ended |
| |
| March 31, 2016 March 31, 2015 |
| ($000's) ($000's) |
| Net income/(loss) for the period 9,964 (26,161) |
| Interest expense, net 16,403 2,466 |
| Taxes 390 (20) |
| Amortization 25,498 8,438 |
| EBITDA 52,255 (15,277) |
| Share-based compensation 586 1,950 |
| Fair value adjustments for contingent consideration(4) 3,286 - |
| Independent Committee related expenses 3,326 - |
| Gain on cross currency swap (7,918) - |
| Transaction related costs(5) 2,549 24,291 |
| Foreign exchange 1,025 (975) |
| Adjusted EBITDA(6) 55,109 9,989 |
| |
| Net income/(loss) for the period 9,964 (26,161) |
| Share-based compensation 586 1,950 |
| Fair value adjustments for contingent consideration(4) 3,286 - |
| Independent Committee related expenses 3,326 - |
| Gain on cross currency swap (7,918) - |
| Transaction related costs(5) 2,549 24,291 |
| Foreign exchange 1,025 (975) |
| Amortization of acquisition related purchase price intangibles 25,293 8,399 |
| Accretion 7,930 1,119 |
| Adjusted Net Income(7) 46,041 8,623 |
| |
| Net income/(loss) per share(1) $0.14 $(0.80) |
| Adjusted Net Income per share(1) $0.62 $0.25 |
| |
| |
| (3) This release contains non-IFRS financial measures, which are noted where used. |
| These non-IFRS financial measures are used because management believes that |
| they provide additional useful information regarding ongoing operating and ...

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