Brio Industries Inc. Reports Year-End and First Quarter Results.

VANCOUVER, British Columbia--(BUSINESS WIRE)--July 19, 1999--

Brio Industries Inc. (NASDAQ: BRIO), Canada's largest independent packager and distributor of juices, waters, soft drinks and new age beverages reported revenues of $40,232,000Cdn during the 1998 fiscal year ended February 28, 1999 (compared to revenues of $35,667,000Cdn during fiscal 1997), an increase of more than 20 percent, year over year.

The Company reported a net loss after all extraordinary items of $1,787,000Cdn (or $0.26Cdn per share) versus a net loss of $7,223,000Cdn (or $1.12Cdn per share) for fiscal 1997. The loss for the year was contributed to primarily by the shut down of its largest plant in Vancouver for most of the Winter and Spring for installation of the new packaging line, a much wetter than average Fall and Winter season, and the transition of its product line-up. The results exclude any accrual for the Company's earnout from Cott Corporation, which was not paid. The Company disputes Cott's calculation of that earnout amount and is pursuing its recovery.

Commencing with the first quarter of fiscal 1999, the Company moved from reporting periods consisting of twelve calendar months to thirteen four-week periods. This allows the Company to operate a more simple accounting procedure. As a consequence, the number of days in the first quarter was reduced by nine. When this is combined with the focus of the Company's Vancouver plant on commissioning of Gatorade(R) and Ocean Spray(R) products, sales for the period are reported lower than the same period last year ($9,137,650Cdn versus $11,310,981Cdn). Again, due to the commissioning process undertaken in the Vancouver plant, the net loss for the period increased from $588,600Cdn (or $0.09Cdn per share) to $937,332Cdn (or $0.13Cdn per share). This was exacerbated by the wettest and dullest Spring in the recorded history of Western Canada and a prolonged labor disruption that interrupted business at one of our major customers.

The Company will report four periods in its second quarter to catch up the difference.

Commencing this spring, Brio introduced a new and exciting line-up of products to replace the old group of products that had historically been represented. The Company has also entered into more formal, long term agreements with its brand partners and, to fill holes in its portfolio, designed and launched several of its own brands.

The process started in March with the launch of Brio's proprietary Cool Canadian(R) Premium Spring Water in its award-winning packaging. The Company followed that with the introduction of America's Best(R) Iced Coffee and Hansen's(R) Signature Soda and Functional Drinks. Brio was next appointed the licensee of SoBe(R), perhaps the hottest-selling new beverage in America. The Company then took on the Canadian rights for Fiji Natural Artesian Water(R) and launched its own Country Harvest(R) line of all natural juices and cocktails. By June Brio had entered into an agreement with The Seagram Beverage Company to represent their Ginger Ale and mixer line-up and had extended and formalized the Company's successful relationship with Cable Car Beverage Company for Stewart's Fountain Classics(R).

In April the Company opened a distribution and sales office in Metropolitan Toronto, Ontario, giving it direct access to the balance of Canada and almost tripling the population base of the markets reached. The Company is now preparing to launch five of its own brands into the United States.

Brio's recent acquisition of Can-Am Distributors and Alamo Snacks will provide it with many operational synergies and reduce the seasonality of its business. Over the ensuing weeks, operations will be consolidated with those of Can-Am, introducing many of their food products to Brio's Integrated Distribution System. The Company anticipates aggregate annual cost savings in excess of $3,000,000Cdn. as a result of these moves. Brio has broadly expanded the distribution base of its products with listings at numerous large convenience, retail grocery and mass merchandise outlets. The effect of these listings will be reflected in the second and ensuing quarters.

Brio is the largest independent packager and distributor of soft drinks, juices, waters and new age beverages in Canada. Brio's unique Integrated Distribution System (IDS) offers turnkey, one-stop shopping to beverage brand owners.

Statements in this news release that are not historical are to be regarded as forward-looking statements which are subject to risks and uncertainties that could cause actual results to differ materially. Such risks and uncertainties with respect to the Company's business include general economic conditions, weather conditions, changing beverage consumption trends, pricing, the availability of raw materials and economic uncertainties, including currency.

                         BRIO INDUSTRIES INC.
             Consolidated Statements of Loss and Deficit
                   (Expressed in Canadian Dollars)

                                   Years ended
                      February 28   February 28   February 28
                         1999          1998          1997

SALES                $ 40,232,287  $ 35,667,202  $ 49,180,471
Cost of sales,
  selling, general
  and administration
  expenses             43,060,030    37,574,011    48,791,309
Amortization of
  capital assets        1,388,290     1,236,892     1,762,607
Amortization of
  goodwill                150,915        99,024       312,406
Amortization of
  deferred costs          276,768       105,226       200,000
Interest on long-term
  debt                    997,637       224,499       440,781
Interest on current debt  143,153       167,248       125,397
Royalty on sale of
  carbonated soft drink
  assets (Note 2(v))            -    (1,059,268)            -
Gain on sale of
  Springfield Water
  assets (Note 11)     (3,997,654)            -             -
Write-down of goodwill          -             -     4,303,665
Settlement of income
  tax reassessment
  (Note 12)                     -     5,041,500             -
Gain on sale of
  carbonated soft
  drink assets (Note 2(v))      -             -    (1,261,608)
-------------------------------------------------------------
                       42,019,139    43,389,132    54,674,557
-------------------------------------------------------------
LOSS BEFORE INCOME
TAXES                  (1,786,852)   (7,721,930)   (5,494,086)
-------------------------------------------------------------
INCOME TAXES RECOVERY
(Note 12)
  Deferred                      -       498,720             -
-------------------------------------------------------------
                                -       498,720             -
-------------------------------------------------------------
NET LOSS FOR THE YEAR  (1,786,852)   (7,223,210)   (5,494,086)

DEFICIT, BEGINNING
OF YEAR               (14,190,148)   (6,966,938)   (1,472,852)
-------------------------------------------------------------
DEFICIT, END OF YEAR $(15,977,000) $(14,190,148)  $(6,966,938)
-------------------------------------------------------------
LOSS PER SHARE
(Note 9(e))                $(0.26)       $(1.12)       $(0.90)
-------------------------------------------------------------
Weighted average
number of shares
outstanding             6,967,195     6,477,687     6,105,335
-------------------------------------------------------------


                         BRIO INDUSTRIES INC.
               CONSOLIDATED STATEMENT OF INCOME (LOSS)
                   (EXPRESSED IN CANADIAN DOLLARS)

                                     May 22           May 31
                                      1999             1998

Sales                           $  9,137,650    $  11,310,981
Cost of sales, selling,
  general & administration        (9,360,246)     (11,326,798)
Depreciation and amortization       (505,596)        (401,864)
Interest expense                    (246,140)        (170,886)
Other income                          37,000                0
                                -----------------------------
                                 (10,074,982)     (11,899,548)
                                -----------------------------
Net loss before taxes               (937,332)        (588,567)
                                -----------------------------
Income taxes
Current                                    0                0
Deferred                                   0                0
                                -----------------------------
Net loss for the period             (937,332)        (588,567)

Deficit, beginning of period     (15,976,965)     (14,190,148)
                                -----------------------------
Deficit, end of period           (16,914,297)     (14,778,715)
                                -----------------------------
LOSS PER SHARE                         (0.13)           (0.09)

Weighted average number of
shares                             7,150,291        6,624,258
                                -----------------------------