Back Yard Burgers Reports Record Revenues and Profits for Second Quarter 2006

Back Yard Burgers, Inc. (NASDAQ:BYBI) today announced
results for the second quarter of 2006.

   --  Total revenues for the 13-week period ended July 1, 2006, were
        $11,695,000, a record second quarter for the company and an
        increase of 8.9% over total revenues for the 13-week period
        ended July 2, 2005. Restaurant sales increased by 6.8% to
        $9,686,000 from $9,072,000 in the year-earlier period due
        primarily to the net addition of five company-operated
        restaurants and the divestiture of four lower-volume
        company-operated restaurants since July 2, 2005. Royalty and
        advertising fees rose by approximately 19% over the
        year-earlier period due to a net increase of 13 franchised
        restaurants since July 2, 2005.

       Franchise and area development fees increased to $204,000 from
        $146,000 in the year-earlier period. The company opened five
        new franchised restaurants during the 13-week period ended
        July 1, 2006, compared with seven in the year-earlier period.
        The company cancelled three area development agreements during
        the second quarter of 2006 due to lack of development and
        recognized approximately $103,000 in area development fees as
        a result of these cancellations. These area development
        agreements represented commitments to develop 42 stores over
        the next six years, including a 37-store development agreement
        with Black Angus Burgers, Inc. The development agreement with
        Black Angus Burgers was originally executed in May 2002 and
        was for 40 stores.

   --  The company also reported record second quarter net income for
        the 13-week period ended July 1, 2006. Net income for the
        13-week period ended July 1, 2006, increased $172,000, or
        42.6%, to $576,000, or $0.11 per diluted share, from $404,000,
        or $0.08 per diluted share, in the year-earlier period. The
        improvement in net income is primarily due to increased
        royalty fees from the net growth of 13 franchised locations
        since the July 2, 2005. The cancelled area development fees
        described above also had a positive impact on net income of
        approximately $67,000 (tax effected) for the 13-week period
        ended July 1, 2006.

   --  For the second quarter of 2006, same-store sales for
        company-operated restaurants increased 0.4% from the
        comparable period in 2005, and same-store sales for franchised
        restaurants increased 1.8% for the same period. Year-to-date
        same-store sales for 2006 increased 1.6% for company-operated
        restaurants and increased 2.0% for franchised restaurants
        versus the comparable period in 2005.

   --  Total revenues for the 26-week period ended July 1, 2006,
        totaled $22,336,000 compared with $20,414,000 in the
        prior-year period. Net income for the 26-week period ended
        July 1, 2006, was $793,000, or $0.15 per diluted share,
        compared with $241,000, or $0.05 per diluted share, in the
        prior-year period. Net income for the 26-week period ended
        July 2, 2005, included a non-cash charge of approximately
        $358,000 (net of a tax benefit of $153,000) relating to the
        extension of the exercise date of certain stock options in
        January 2005.

   --  Unit activity for the quarter included the opening of five
        franchised stores and the closing of three franchised stores.
        As of July 1, 2006, the company's restaurant system comprised
        174 units, including 42 company-operated stores and 132
        franchised stores. Expansion plans for the remainder of 2006
        include the opening of two company-operated stores and 12 to
        15 franchised stores.

   Back Yard Burgers operates and franchises quick-service
restaurants in 21 states, primarily in markets throughout the
Southeast region of the United States. The restaurants specialize in
charbroiled, freshly prepared, great-tasting food. As its name
implies, Back Yard Burgers strives to offer the same high-quality
ingredients and special care typified by outdoor grilling in the
backyard. Its menu features made-to-order gourmet Black Angus
hamburgers and chicken sandwiches - charbroiled over an open flame,
fresh salads, chili and other specialty items, including hand-dipped
milkshakes, fresh-made lemonade and fresh-baked cobblers.

   This press release contains forward-looking statements within the
meaning of the federal securities laws, including statements regarding
the number of company-operated and franchised restaurants the company
anticipates opening during fiscal year 2006. Forward-looking
statements are based upon estimates, projections, beliefs and
assumptions of management at the time of such statements and should
not be viewed as guarantees of future performance. Such
forward-looking information involves important risks and uncertainties
that could significantly impact anticipated results in the future and,
accordingly, such results may differ materially from those expressed
in any forward-looking statements by or on behalf of the company. The
factors that could cause our actual results to differ materially, many
of which are beyond our control, include, but are not limited to, the
following: delays in opening new stores or outlets because of weather,
local permitting, and the availability and cost of land and
construction; increases in competition and competitive discounting;
increases in minimum wage and other operating costs; shortages in raw
food products; volatility of commodity prices; consumer preferences,
spending patterns and demographic trends; the possibility of
unforeseen events affecting the industry generally, and other risks
described from time to time in our periodic reports filed with the
Securities and Exchange Commission. Back Yard Burgers, Inc. disclaims
any obligation to update or revise any forward-looking statement based
on the occurrence of future events, the receipt of new information, or
otherwise.

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                        BACK YARD BURGERS, INC
            Unaudited Consolidated Statements of Operations
               (in thousands, except per share amounts)

                         Thirteen Weeks Ended   Twenty-Six Weeks Ended
                         --------------------   ----------------------
Revenues:                07/01/06    07/02/05    07/01/06    07/02/05
                         --------    --------    --------    --------
  Restaurant sales       $  9,686    $  9,072    $ 18,618    $ 17,280
  Franchise and area
    development fees          204         146         290         311
  Royalty fees              1,245       1,038       2,380       1,969
  Advertising fees            314         271         611         515
  Other                       246         210         437         339
                         --------    --------    --------    --------
    Total revenues         11,695      10,737      22,336      20,414
                         --------    --------    --------    --------
Expenses:
  Cost of restaurant
    sales                   3,120       2,951       6,117       5,590
  Restaurant operating
    expenses                4,646       4,275       8,936       8,270
  General and
    administrative          1,634       1,579       3,382       3,633
  Advertising                 668         713       1,353       1,267
  Depreciation and
    amortization              543         515       1,094       1,078
  Gain on sale of
    assets                   --          --          (162)       --
                         --------    --------    --------    --------
    Total expenses         10,611      10,033      20,720      19,838
                         --------    --------    --------    --------

  Operating income          1,084         704       1,616         576

Interest income                16           7          23          13
Interest expense             (198)       (104)       (387)       (212)
Other, net                    (24)        (23)        (47)        (44)
                         --------    --------    --------    --------
  Income before income
    taxes                     878         584       1,205         333
Income tax provision          302         180         412          92
                         --------    --------    --------    --------
Net income               $    576    $    404    $    793    $    241
                         ========    ========    ========    ========
Income per share:
  Basic                  $   0.11    $   0.08    $   0.16    $   0.05
                         ========    ========    ========    ========
  Diluted                $   0.11    $   0.08    $   0.15    $   0.05
                         ========    ========    ========    ========
Weighted average number
  of common shares and
  common equivalent
  shares outstanding:
    Basic                   5,022       4,806       4,982       4,798
                         ========    ========    ========    ========
    Diluted                 5,151       5,107       5,128       5,121
                         ========    ========    ========    ========

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