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42 Below (FTB) expects to beat projections

42 Below (FTB) expects to beat prospectus projections.

Thursday 24th June 2004: 42 BELOW (FTB) today announced that it expects to exceed it’s prospectus revenue projections by approximately 40%, and project a profit for the financial year ending March 2006.

Based on current sales, customer forward orders, and projected sales volumes, 42 BELOW anticipates sales revenues of more than $9.0 million for the year ending September 2004. The IPO prospectus projected sales of $6.43 million for that period which should be exceeded by at least $2.57 million.

By September 2004, 42 BELOW is projected to have invested $3 million to $4 million more than it had projected in it’s prospectus in additional stock and debtors to support a higher sales base than was projected in the prospectus. 42 BELOW also anticipates spending an additional $1.5 million on market development than was projected in the prospectus. These increases reflect higher than projected export volumes, primarily driven by an increase in USA outlets. There are now more than 5,000 outlets in the USA and other export markets are also experiencing strong growth.

The company anticipates it will have $5.0 million to $6.0 million in cash by September 2004, depending on the timing of US shipments and debtor payments. The company projected in it’s prospectus that it would have $10.449 million in cash by September 2004. The difference between the actual and projected figure is due primarily to the projected increased investment in stock, debtors and marketing expenditure.

Even though 42 BELOW has projected increased expenditure in the above areas it does not anticipate any requirement for additional capital raising.

“We believe the company should reach a key milestone by breaking even on trading in the last quarter of the current financial year (ending March 2005). 42 BELOW believes it will be profitable in the financial year ending March 2006,” said Grant Baker, 42 BELOW’s Executive Chairman.

This positive announcement follows 42 BELOW’s winning of three prestigious European Awards, including a gold at the Salon Internationale de L’ Alimentation Food Exhibition in France.

“Winning these awards should provide us with European opportunities that are not dissimilar to those that have driven this better than expected growth in the US market,” said 42 BELOW’s Chief Vodka Bloke, Geoff Ross.

42 BELOW intends to hold it’s Annual General Meeting in Auckland on Wednesday, 18th August 2004.

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