Final Results

Blavod Wine and Spirits PLC

Preliminary results for year ended 31 March 2011

13 June 2011

Financial Highlights

  * Own brands' revenue increases by 12% with improved margins and contribution
  * The loss of Cockspur Rum agency mid year together with reduced volumes of
    Mickey Finn impact result
  * EBITDA loss of £50k versus a previous year profit of £78k on sales of £7.2m
    (2010: £8.3m)
  * All other continuing agency brands grew and on average improved revenues by
    29% year on year
  * Brand support increased to support growth and administrative expenses have
    reduced.


Commenting on the results, Richard Ambler, Managing Director, said:

"The continued growth in our own brands and the strong growth in continuing
agency brands, despite tough trading conditions in the UK together with the
recent changes in our portfolio, creates opportunities in the year ahead"


 For further information, please contact:

 Blavod Wines and Spirits plc                  Tel: [phone]

 Richard Ambler



 Brewin Dolphin Corporate Advisory & Broking   Tel: [phone]

 Neil Baldwin



Chairman's statement

In the year to March 2011 our own brands' revenue increased by 12% with improved
margins  and contribution  supported by  increased marketing  investment, albeit
from a relatively low base.

We opened new export markets including USA, repositioned Blavod Black Vodka with
new  premium packaging, launched Diva Vodka and  grew Blackwood's Gin to make it
our  most  profitable  brand.  However,  this  performance  was  offset  by  the
disappointing loss of Cockspur Rum agency mid year together with reduced volumes
of Mickey Finn following aggressive competitor price reductions. The collapse of
Oddbins  resulted in  some losses  although this  was mitigated by maintaining a
prudent  stance to credit limits. Overall, this led to an overall EBITDA loss of
£50k versus a previous year profit of £78k on sales of £7.2m (2010: £8.3m).

All other continuing agency brands grew and on average improved revenues by 29%
year on year.

I  joined the Board of Blavod Wines and Spirits PLC last year as a Non-Executive
Director  and was delighted to  accept the invitation to  become Chairman of the
business  in January  2011. My thanks  go to  my predecessor Colin Campbell, and
also  to Lawrence  Banks, who  successfully steered  the Group through difficult
times.  Colin  and  Lawrence,  who  both  retired  in January of this year, were
instrumental  in extricating the Group from its  US merger and in setting up the
current  UK based structure.  They were also  closely involved in the subsequent
successful acquisition of Blackwood's Gin.

Our  focus now  is to  restore profitability  and successfully execute an agreed
growth strategy. Longer term we wish to develop a strong balance sheet and build
strong brand value.

Strategy for growth

During  the year  we developed  a strategy  to create  a healthier  platform for
growth and profit. This will be achieved by:

-  Increasing international  distribution of  our own  brands, adding new export
markets  such as  China for  Blavod. This  coming year  we plan to enter further
markets in Latin America and in the Far East.

-  Extending breadth and  depth of customer  relationships including premium On-
trade  coverage in the  UK to assist  with an overall  increase in premium brand
distribution and marketing effort.

-  Seeking  additional  agency  brand  distribution agreements to complement and
strengthen  our existing product  portfolio. During the  year we added Matusalem
Rum.

-  Developing our own  new brands to  fill remaining portfolio  gaps. We plan to
introduce our first new brand in the autumn of 2011.

-   Restructuring   our  overheads  through  basic  process  and  administrative
efficiencies  resulting in reduced back-office spend.  This combined with a 13%
reduction  in PLC cost led to an overall saving in other administrative expenses
of 7% year on year.

-  Reinvesting  overhead  savings  into  broader  customer  coverage  and  brand
marketing spend. Here we increased spending by 25% year on year. However this is
off  a low base and  we will continue to  find ways to improve this historically
low reinvestment rate to accelerate growth in the future.

Outlook

We made a strong start to our growth strategy and continue to drive distribution
and activation of our full product range, both owned and agency brands.

Having  the right portfolio and product mix is essential and work is in progress
to  secure  new  agency  agreements.  As  communicated earlier this year, we are
working  closely  with  DBR  Wines  Limited  to  ensure  a smooth and successful
transition to their own in-market wine company.

We  have now paid  the final instalment  due in relation  to the purchase of the
Blackwood's  Gin  trademark.  There  now  remains  only the final three years of
profit share before we own the trademark outright.

Market  conditions remain challenging and consumer confidence fragile. Advancing
our  export effort will further  reduce our exposure to  the UK market. However,
premium  brands have demonstrated their ability  to remain relatively buoyant if
well positioned and actively supported at both consumer and customer level. This
remains at the heart of everything we do.

D.Goulding

Chairman


Consolidated income statement

for the year ended 31 March 2011

                                                   2011      2010

                                                  £'000     £'000

 Revenue                                          7,216     8,316

 Cost of sales                                  (5,810)   (6,745)

 Gross profit                                     1,406     1,571

 Advertising and promotional costs                (336)     (268)

 Non recurring costs                                  -      (21)

 Other administrative expenses                  (1,120)   (1,204)

 Total administrative expenses                  (1,456)   (1,493)

 EBITDA                                            (50)        78

 Depreciation and amortization                      (6)       (6)

 Operating (loss)/profit                           (56)        72

 Finance income                                      13        20

 Finance expense                                  (130)     (107)

 (Loss) before tax from continuing operations     (173)      (15)

 Income tax                                           -         -

 (Loss) for the year                              (173)      (15)

 (Loss) per share

 Basic (pence per share)                         (0.20)     (0.02)

 Diluted (pence per share)                       (0.20)     (0.02)


Consolidated statement of comprehensive income

for the year ended 31 March 2011

                                            2011    2010

                                           £'000   £'000

 (Loss) for the year                       (173)    (15)

 Other comprehensive income                    -       -

 Total comprehensive income for the year   (173)    (15)


Consolidated balance sheet

as at 31 March 2011

                                    2011      2010

                                   £'000     £'000

 Assets

 Non-current assets

 Property, plant and equipment        29        24

 Intangible assets                 1,380     1,311

                                   1,409     1,335

 Current assets

 Inventories                         583       612

 Trade and other receivables       1,488     1,827

 Cash and cash equivalents            36       118

 Total current assets              2,107     2,557

 Total assets                      3,516     3,892

 Liabilities

 Non current liabilities

 Borrowings                        (350)     (337)

 Derivative                         (48)      (60)

                                   (398)     (397)

 Current liabilities

 Trade and other payables          (923)     (974)

 Finance facility liability        (740)     (905)

 Total current liabilities       (1,663)   (1,879)

 Total liabilities               (2,061)   (2,276)

 Net assets                        1,455     1,616

 Equity

 Equity attributable to equity
 holders of the parent

 Share capital                       878       878

 Share premium account                 _         _

 Shares to be issued                  51       717

 Retained earnings                   526        21

 Total equity                      1,455     1,616


Consolidated statement of changes in equity

for the year ended 31 March 2011

                                            Share   Share Shares Retained  Total
                                          Capital premium  to be earnings equity
                                            £'000   £'000 issued    £'000  £'000
                                                           £'000

Balance at 31 March 2009 and 1 April 2009     878 -          701       36  1,615

Share based payment charge                      - -           16        -     16

Transactions with owners                        - -           16        -     16

(Loss) for the year                             - -            -     (15)   (15)

Balance at 31 March 2010 and 1 April 2010     878 -          717       21  1,616

Share-based payment charge                      - -           12        -     12

Lapsed/forfeited share options -                - -        (678)      678      -
reclassification to
retained earnings

Transactions with owners                        - -        (666)      678     12

(Loss) for the year                             - -            -    (173)  (173)

Balance at 31 March 2011                      878 -           51      526  1,455


Consolidated cash flow statement

for the year ended 31 March 2011

                                                                     2011  2010

                                                                    £'000 £'000

Cash flows from operating activities

Operating (loss)/profit                                              (56)    72

Adjustments for:

Depreciation                                                            6     6

Share-based payment                                                    12    16

                                                                     (38)    94

Movements in working capital

Decrease / (Increase) in inventories                                   30 (160)

Decrease/(Increase) in trade receivables                              339 (103)

(Decrease) in trade payables                                         (51)  (65)

Cash generated / (used) by operations                                 318 (328)

Net finance expense                                                 (117)  (90)

Net cash generated / (used in) operating activities                   163 (324)

Cash flows from investing activities

Purchase of property, plant and equipment                            (11)  (18)

Expenditure relating to the acquisition of licences and trade marks  (69) (152)

Net cash (used by) investing activities                              (80) (170)

Cash flows from financing activities

Net cash (repaid to) / received from finance facility               (165)   160

Proceeds from convertible loan note                                     -   400

Net cash (used in)/received from financing activities               (165)   560

Net (decrease) / increase in cash and cash equivalents               (82)    66

Cash and cash equivalents at beginning of year                        118    52

Cash and cash equivalents at end of year                               36   118


Notes

1. Basis of preparation

The  consolidated financial statements are for  the twelve months ended 31 March
2011. They   have   been   prepared  in  accordance  with  the  requirements  of
International  Financial Reporting Standards  (IFRS) as adopted  by the European
Union  (EU)  and  with  those  parts  of  the  Companies  Act 2006 applicable to
companies reporting under IFRS.

The financial information contained in this document does not constitute
statutory financial statements within the meaning of section 434 of the
Companies Act 2006. The figures for the year ended 31 March 2011 have been
extracted from the audited statutory financial statements. The financial
statements for the year ended 31 March 2011 received an unqualified auditors'
report which did not contain a statement under section 498 (2) or (3) of the
Companies Act 2006.

2. Earnings per share

The calculation of the basic (loss) per share is based on the earnings
attributable to ordinary shareholders divided by the weighted average number of
shares in issue during the year.

The diluted (loss) per share is identical to the basic (loss) per share as the
exercise of convertible loan instruments, warrants and options would be anti-
dilutive as the market value of shares is less than the exercise price of the
convertible loan instruments, warrants and options granted.

Reconciliations of the earnings and weighted average number of shares used in
the calculations are set out below.

                                                                 2011       2010

(Loss) attributable to ordinary shareholders (£'000)            (173)       (15)

Weighted average number of shares (used for basic earnings 87,758,508 87,758,508
per share)

Basic and diluted (loss) per share (pence)                     (0.20)     (0.02)


3.  Annual report

Copies of the published accounts of the Company will be sent to all shareholders
on or around 13 June 2011 and will be available from that the Company's
registered office and will be located on:



http://www.blavodwinesandspirits.com/investors/accounts.htm

ENDS







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Source: Blavod Wines & Spirits plc via Thomson Reuters ONE

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