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Blueheath Holdings (BOK)

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Tuesday 09 August, 2005

Blueheath Holdings

Business Update

Blueheath Holdings PLC
09 August 2005



Immediate Release                                                9 August 2005

                             Blueheath Holdings plc
                         ('Blueheath' or the 'Company')

                                 Business Update

Blueheath is a national delivered wholesaler using sophisticated, proprietary
technology to offer a substantial cost advantage over established players in the
£16.4bn grocery wholesale sector. The Company today provides the following
business update.

Contract Wins

Blueheath is today delighted to announce the following new contract wins:

  * Vue Cinemas, the UK's largest multiplex cinema operator with 54
    outlets - contract to supply all food service products.

  * Motorway service station operator - contract to supply full range of
    impulse and convenience products.

  * Northcliffe Retail, the retail division of Northcliffe Newspapers
    Group - appointed as nominated supplier for the South East franchise 
    network with an initial 14 outlets, expected to build over time to 
    50 outlets.

  * 9 site forecourt and convenience chain in the South

  * Star services 5 site forecourt chain in the South East.


The pace and scale of account wins remains in line with management expectations,
although it will as usual take some time until all the new accounts are fully
operational with roll outs beginning in August and September.

Integration of CTM wholesale

Following the acquisition in April this year of CTM Wholesale Limited ('CTM'),
Blueheath is also pleased to report that the integration continues to progress
well:

  * Turnover is ahead of expectations with no material customer losses.

  * Blueheath stock management technology is now operational at the Wrexham
    site and is on track in delivering the expected benefits from reducing CTM
    stock towards Blueheath's normal  level.

  * Steady progress continues to be made in delivering the expected cost
    synergies.

Current Trading and Operations

The Group is continuing to make good progress both organically and through its
targeted acquisition strategy.  The Directors are pleased with the pace of new
accounts wins which remains in line with management expectations. Once won,
however, as has previously been highlighted by the Company, the pace of the roll
out of outlets can be out of the Company's control and some accounts have been
rolling out more slowly that originally expected. The Company will continue to
monitor this situation and update the market as appropriate.


Operationally, the Company continues to perform at the upper level of
expectations in terms of quality and reliability of service.


Commenting on the results and prospects, Douglas Gurr, Chief Executive, said:

'Our new accounts emphasise our commitment to the leisure, petrol forecourt and
food services sectors and further strengthen our expertise in these areas.
Equally pleasing is the initial integration shown at CTM which demonstrates the
value that we can generate from carefully selected potential acquisitions.'

For further details:

Blueheath Holdings plc
Douglas Gurr, Chief Executive                          Tel: 020 7689 2455
Simon Mindham, Finance Director                        Tel: 020 7689 2464

Buchanan Communications
Mark Edwards / Nicola Cronk / James Strong             Tel: 020 7466 5000

Notes to editors:

Blueheath is a wholesaler of groceries to convenience stores in the £16.4
billion UK grocery wholesale sector. The Group sells and arranges the
distribution of approximately 3,100, primarily ambient, product lines to over
1,600 independent and multiple retail and leisure outlets within the UK.
Blueheath's innovative technology-driven business model is founded on the basic
principles of stripping out unnecessary supply chain costs and overheads and
passing on financial and operational benefits to customers. This enables
Blueheath to offer customers a wholesale delivery service of groceries at close
to Cash & Carry prices.

Blueheath achieves cost savings in three ways:

1. Operating on low stock levels through the use of sophisticated, proprietary
   stock prediction technology.

2. Using spare distribution capacity through its partnership with British
   Bakeries Ltd and other operators.

3. The extensive use of process automation to minimise administration costs.






                      This information is provided by RNS
            The company news service from the London Stock Exchange