Preliminary Results

Blavod Black Vodka PLC
12 June 2002



                             BLAVOD BLACK VODKA PLC

             Preliminary Results for the year ended 31st March 2002



Blavod Black Vodka plc, owns and sells Blavod, a premium vodka brand. Blavod is
black in colour, neutral tasting and has already achieved sales success in the
UK, via links with distributors including leading supermarkets and off and
on-licence groups, and overseas. The Company joined The Alternative Investment
Market in February 2001.



  • 37% sales increase .
  • Loss of £1.15million (2001 : £1.32million) driven by increase in marketing
    spend following flotation .
  • Higher volumes now leading to production efficiencies and cost reductions
    .
  • Encouraging start to current year - April & May sales significantly higher
    than first quarter of last year .
  • New markets emerging for Blavod and continuing growth in Duty Free sales .



Richard Ambler, Chief Executive, commented:

'We are pleased that the growth in sales since last Autumn has continued into
the current financial year .'



                                                                    11 June 2002

ENQUIRIES:

Blavod Black Vodka plc

Tel: [phone]

Richard Ambler, Chief Executive

David Wheatley, Finance Director



                              CHAIRMAN'S STATEMENT

I am pleased to report a further increase in group turnover from the previous
year and also that volume sales of Blavod rose by a third. This is a most
satisfying outcome after the disappointing start to the year reported in our
interim results. Duty Free sales also increased steadily and new markets around
the world, notably amongst former Soviet Union countries, are showing
encouraging signs.

The action taken by the company in the important US market is not yet reflected
in sales for the year under review, but we hope to see improvements here
following the appointment of Branca Products Incorporated who became our
importer from 1 January 2002 . Following this agreement for the USA, we were
appointed as UK distributors of Fernet Branca's range of products on 1 April
2002. Although contribution to profits from sales of these products will not
initially be significant, we look for closer cooperation between our two
organisations to lead to opportunities for Blavod elsewhere.

Our acquisition last year of the UK distribution rights of Babco Europe products
-- Agwa, TJ's Cream Liqueurs and Mickey Finn brands -- was too late to influence
sales for the 2001 Christmas season, but we have now achieved listings with
major off-trade chains for all three ranges and while further listings are
needed to realise the potential of these brands, we are currently in
negotiations with other key outlets.

Marketing expenditure increased in line with our plans to utilise the funds
raised from our flotation and the resulting increase in sales is pleasing. The
expected contribution from our UK distribution of Domaines Barons de
Rothschild's wines was also achieved and the ongoing increase in customers and
sales will contribute to an improvement in our management fees.

Whilst your group has diversified usefully from being a one product supplier in
the UK, Blavod Black Vodka remains our priority. Our ability to supply other
brands of real potential strengthens our relationships with major UK customers
and has already helped to gain new listings.

Primarily as a consequence of increasing sales to markets such as Duty Free and
Brazil, our gross margins declined in the year. These are two markets where we
are not required to support our distributors with their marketing and
promotional expenditure and in consequence sell at lower prices. While this
reduces gross margin it does not diminish contribution to our net results.
Indeed, increasing volumes of Blavod are now enabling us to achieve production
efficiencies and to negotiate lower prices on the supply side which will benefit
next year's results.

Our plans are to continue progress towards further sales increases across the
portfolio and take advantage of the concomitant benefit of cost reductions as we
move the group towards profitability. An encouraging start to this year has been
made, with sales for April and May significantly exceeding the first quarter of
the previous period.

The present rate of loss is largely driven by the significant increase in spend
on marketing which has yielded positive results for the brand. We anticipate a
reduction in this expenditure in the year ahead and, together with other
factors, real movement towards eventual profitability.

At the forthcoming Annual General Meeting the Board is seeking your approval for
resolutions relating to authority to issue further shares. These ask for a
renewal of our ability to issue shares for a non cash consideration and,
although no specific plans are presently contemplated, an additional resolution
seeks a similar authority to issue a limited number of shares for cash so as to
allow the Board flexibility in the event that opportunities arise in a
fast-moving market place.

The Board also recommends adoption of the resolutions relating to our Share
Option Scheme as a helpful tool especially to attract and secure new senior
personnel should that need arise. On the advice of the Remuneration Committee,
the Board has decided not to issue further options to management at present. We
further propose to replace our present scheme with a more tax efficient ''EMI''
scheme and substitute all existing management options on identical terms and
conditions. Renewal of authority to issue further options is also sought.

The group's employees have worked tirelessly and, thanks to the efforts of the
sales and management teams, substantial progress has been achieved. I would wish
on your behalf to pay special tribute to Mark Dorman who left the Board during
the year. Mark conceived Black Vodka, establishing and running the company from
its inception. We will continue to have the benefit of his informal advice on
marketing matters and I am pleased that he will remain involved as a significant
shareholder.

Allan Shiach



Consolidated Profit and Loss Account

For the year ended 31 March 2002



                                                                              2002                    2001
                                                        Notes                £'000                   £'000

Turnover                                                  1                 1,145                     835
Cost of sales                                                                (792)                   (565)

Gross profit                                                                  353                     270
Administrative expenses                                                    (1,605)                 (1,378)

Operating loss                                            2                (1,252)                 (1,108)
Bank interest receivable                                                       97                      19
Interest payable and similar charges                                             -                    (43)

Loss on ordinary activities before taxation                                (1,155)                 (1,132)
Taxation                                                                        -                       -

Loss for the financial year                                                (1,155)                 (1,132)

Loss per share                                            4                (7.94p)                (14.43p)
Diluted loss per share                                    4                (7.87p)                (13.13p)


All of the group's operations are classed as continuing. There were no gains or
losses in either period other than those included in the above profit and loss
account.

Consolidated Balance Sheet

As at 31 March 2002
                                                        Notes                 2002                   2001
                                                                             £'000                  £'000

Fixed assets
Intangible assets                                                           1,344                    915
Tangible assets                                                                33                     10
                                                                            1,377                    925

Current assets
Stock                                                                         286                     73
Debtors                                                                       430                    191
Cash at bank                                                                1,236                  3,041

                                                                            1,952                  3,305

Creditors: amounts falling due within one year                               (517)                  (455)

Net current assets                                                          1,435                   2,850




Net assets                                                                  2,812                  3,775

Capital and reserves
Called up share capital                                                       148                    143
Share premium account                                                       5,967                  5,780
Profit and loss account                                                    (3,303)                (2,148)

Shareholders' funds                                                         2,812                  3,775


The accounts were approved by the Board of Directors on 11 June 2002 and were
signed on their behalf by



David Wheatley

Director



Consolidated Cash Flow Statement

For the year ended 31 March 2002
                                                        Notes                  2002                   2001
                                                                              £'000                  £'000

Cash outflow from operating activities                    2                 (1,529)                (1,355)

Returns on investments and servicing of finance
Interest received                                                               97                     19
Interest paid                                                                     -                    (7)

Net cash inflow from returns on investments and                                 97                     12
servicing of finance

Capital expenditure
Purchase of tangible fixed assets                                              (33)                    (5)
Expenditure relating to the registration of trademarks                         (15)                   (43)
Purchase of distribution rights                                               (325)                      -

Net cash outflow for capital expenditure                                      (373)                   (48)




Cash outflow before financing                                               (1,805)                (1,391)

Financing
Issue of ordinary share capital                                                  -                  4,010
Cost of share issue                                                               -                  (463)
Investors' loans subsequently capitalised on Admission                            -                   900
Loan repayments                                                                   -                  (161)

Net cash inflow from financing                                                   -                  4,286

(Decrease)/Increase in cash in the year                   3                (1,805)                  2,895




Notes

 1. Turnover

    Turnover relates to the group's principal activity
                                                                                   Turnover by destination

                                                                                        2002              2001
                                                                                       £'000             £'000

    United Kingdom                                                                       708               503
    Europe                                                                                31                41
    USA                                                                                   85               118
    Duty Free                                                                            129                72
    Rest of World                                                                        192               101
                                                                                       1,145               835





 2. Reconciliation of operating loss to net cash outflow from operating
    activities
                                                                                        2002              2001
                                                                                       £'000             £'000

    Operating loss                                                                   (1,252)           (1,108)
    Depreciation                                                                         10                 4
    Amortisation                                                                         102               50
    (Increase)/decrease in stocks                                                      (213)              (9)
    (Increase)/Decrease in debtors                                                    (239)                73
    Increase/(Decrease) in creditors                                                      63             (365)
    Net cash outflow from operating activities                                       (1,529)           (1,355)





 3. Reconciliation of net cash flow to movement in net funds
                                                                                        2002              2001
                                                                                       £'000             £'000

    (Decrease)/Increase in cash in the year                                         (1,805)             2,895
    Cash inflow from net increase in net funds                                            -               161

    Change in debt resulting from cash flows                                         (1805)             3,056

    Capitalisation of investors' loan                                                     -               150
    Net funds/(debt) at the beginning of the period                                    3,041            (165)
    Net funds at the end of the period                                                1,236             3,041





 4. Loss per share

The loss per share is based upon a loss of £1,155,000 (2001:loss of £1,132,000)
and the weighted average number of shares ranking for dividend during the year
of 14,551,306 (2001: 7,841,000).

The fully-diluted loss per share is based upon the loss as disclosed above and
the weighted average number of shares ranking for dividend during the year of
14,667,965 (2001: 8,622,000) adjusted for the effects of all dilutive potential
shares.



Copies of this report have been sent to shareholders and are available at the
Company's Registered Office: 202 Fulham Road, London, SW10 9PJ.



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