Blavod Wines & Spirits has issued a profits warning after sales at the drinks producer fell “well below expectations” in the key Christmas period.

Blavod said sales had “slowed abruptly in the last weeks of the year”, which it blamed on losing market share to heavily promoted rival products.

“The board expects a better fourth quarter [but] given the importance of Christmas and New Year this will not be sufficient to regain the momentum lost over that period,” it said in a statement.

“In addition, the company has suffered exchange losses and one-off costs not originally forecast. As a result, profits will be severely affected and our current expectation is for profits at the break-even level, as against a reported profit of £185,000 in 2008-09.”