================================================================================

                        SECURITIES & EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(MARK ONE)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    For the quarterly period ended September 30, 2000

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    For the transition period from ___________________ to ___________________

                         Commission file number: 0-30002

                             RAVENSWOOD WINERY, INC.
        (Exact Name of Small Business Issuer as Specified in its Charter)

               California                               94-3026706
     (State or Other Jurisdiction of        (I.R.S. Employer Identification No.)
     Incorporation or Organization)

           18701 Gehricke Road
           Sonoma, California                              95476
(Address of Principal Executive Offices)                (Zip Code)

                     Issuer's Telephone Number: 707-938-1960

Check  whether  the  registrant  (1) filed all  reports  required to be filed by
Section 13 or 15(d) of the Securities  Exchange Act of 1934 during the preceding
12 months (or for such shorter  period that the  registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days.

                                 Yes [X] No [ ]
The number of shares  outstanding  of the  Issuer's  Common Stock on November 8,
2000 was 4,870,179.

Transitional Small Business Disclosure Format: Yes [ ] No [X]

================================================================================


<PAGE>


                                              RAVENSWOOD WINERY, INC.

                                           PART I. FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                                                                             Page
                                                                                                             ----
<S>                                                                                                          <C>
ITEM 1.       FINANCIAL STATEMENTS

    Balance Sheets as of September 30, 2000 and June 30, 2000.                                                2

    Statements of Income for the three months ended September 30, 2000 and 1999.                              3

    Statements  of Cash Flows for the three months ended  September 30, 2000 and
    1999.                                                                                                     4

    Notes to Financial Statements.                                                                            5

ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
              CONDITION AND RESULTS OF OPERATIONS                                                             8

                                            PART II. OTHER INFORMATION

ITEM 2.       CHANGES IN SECURITIES AND USE OF PROCEEDS                                                      20

ITEM 6.       EXHIBITS AND REPORTS ON FORM 8-K                                                               20
</TABLE>


                                                         1
<PAGE>

                                           RAVENSWOOD WINERY, INC.
                                        PART I. FINANCIAL INFORMATION

<TABLE>
Item 1.    Financial Statements

                                           RAVENSWOOD WINERY, INC.
                                                BALANCE SHEET

                                                                                September 30,         June 30,
                                                                                    2000                2000
                                                                                 -----------         -----------
                                  ASSETS                                         (unaudited)
<S>                                                                              <C>                 <C>
Current assets:
   Cash and cash equivalents                                                     $ 6,476,433         $ 5,769,373
   Accounts receivable, less allowance of $10,000                                  5,418,219           4,166,816
   Inventories                                                                    26,184,699          20,521,284
   Prepaid income taxes                                                                 --               277,500
   Prepaid expenses                                                                   66,893             100,131
                                                                                 -----------         -----------
      Total current assets                                                        38,146,244          30,835,104
   Property, plant and equipment, net                                             14,648,575          14,787,553
   Deferred tax assets                                                                52,000             180,000
   Note receivable from shareholder                                                  310,000             310,000
   Other assets                                                                       65,195              60,433
                                                                                 -----------         -----------
                                                                                 $53,222,014         $46,173,090
                                                                                 ===========         ===========

                   LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Current portion of long-term debt                                             $    57,011         $    83,597
   Current portion of capital lease obligations                                      594,912             617,979
   Short-term borrowings                                                                --               500,000
   Accounts payable                                                                8,025,565           3,217,036
   Income taxes payable                                                              614,500
   Accrued commissions                                                               594,185             514,379
   Accrued liabilities                                                               470,705             390,010
                                                                                 -----------         -----------
     Total current liabilities                                                    10,356,878           5,323,001

Long-term liabilities:
   Long-term debt, net                                                             6,921,852           6,453,407
   Capital lease obligations, net                                                  2,378,061           2,392,497
   Convertible debentures                                                          1,687,500           1,687,500
                                                                                 -----------         -----------
     Total liabilities                                                            21,344,291          15,856,405
                                                                                 -----------         -----------

Shareholders' equity:
   Preferred stock, no par value; 1 million shares authorized, none issued              --                  --
   Common stock, no par value; 20 million shares authorized,
     4,858,929 and 4,856,779 issued and outstanding                               15,076,947          15,054,373
   Retained earnings                                                              16,691,200          15,176,560
   Unrealized gain on available-for-sale securities                                  109,576              85,752
                                                                                 -----------         -----------
     Total shareholders' equity                                                   31,877,723          30,316,685
                                                                                 -----------         -----------
                                                                                 $53,222,014         $46,173,090
                                                                                 ===========         ===========

<FN>
             See accompanying notes to financial statements.
</FN>
</TABLE>


                                                            2
<PAGE>

                     RAVENSWOOD WINERY, INC.
                       STATEMENT OF INCOME
                           (UNAUDITED)

                                                Three months ended September 30,
                                                   -----------------------------
                                                       2000             1999
                                                   -----------      -----------
Gross sales                                        $ 9,606,953      $ 8,288,976
  Less excise taxes                                    331,044          334,645
  Less discounts, returns and allowances               378,084          262,148
                                                   -----------      -----------

Net sales                                            8,897,825        7,692,183

Cost of goods sold                                   4,032,631        3,463,418
                                                   -----------      -----------

Gross profit                                         4,865,194        4,228,765

Operating expenses                                   2,217,459        1,739,850
                                                   -----------      -----------

Operating income                                     2,647,735        2,488,915
                                                   -----------      -----------

Other income (expense):
  Interest expense                                    (257,730)        (123,766)
  Other, net                                           144,635           85,796
                                                   -----------      -----------
                                                      (113,095)         (37,970)
                                                   -----------      -----------

Income before tax provision                          2,534,640        2,450,945

Provision for income taxes                           1,020,000          953,130
                                                   -----------      -----------

Net income                                         $ 1,514,640      $ 1,497,815
                                                   ===========      ===========

Earnings per share:

  Basic                                            $      0.31      $      0.33
                                                   ===========      ===========
  Diluted                                          $      0.30      $      0.31
                                                   ===========      ===========

Weighted average number of common
  shares outstanding:

  Basic                                              4,857,546        4,568,352
                                                   ===========      ===========
  Diluted                                            5,102,221        5,006,581
                                                   ===========      ===========

                 See accompanying notes to financial statements.


                                       3
<PAGE>

<TABLE>
                          RAVENSWOOD WINERY, INC.
                          STATEMENT OF CASH FLOWS
                                (UNAUDITED)

<CAPTION>
                                                     Three months ended September 30,
                                                     --------------------------------
                                                           2000            1999
                                                       ------------    ------------
<S>                                                    <C>             <C>
Operating activities:
Net income                                             $  1,514,640    $  1,497,815

Items not requiring the current use of cash:
    Depreciation and amortization                           373,562         143,390
    Deferred income taxes                                   128,000          37,568
    Unrealized gain on available-for-sale securities         23,824            --
    Changes in other operating items:
        Accounts receivable                              (1,251,403)     (1,204,158)
        Inventories                                      (5,663,415)     (1,856,979)
        Accrued/prepaid income taxes                        892,000         945,330
        Prepaid expenses and other                           28,476         (37,588)
        Accounts payable                                  4,808,529         350,165
        Accrued liabilities and accrued commissions         160,501         461,211
                                                       ------------    ------------
    Cash provided by operations                           1,014,714         336,754
                                                       ------------    ------------

Investing activities:
Additions to plant and equipment                           (110,701)     (2,102,449)
                                                       ------------    ------------
    Cash used for investing activities                     (110,701)     (2,102,449)
                                                       ------------    ------------

Financing activities:
Short-term borrowings, net                                 (500,000)       (950,000)
Proceeds from long-term debt                                455,000         318,527
Repayment of long-term debt                                (174,527)        (82,874)
Issuance of common shares                                    22,574            --
                                                       ------------    ------------
    Cash used for financing activities                     (196,953)       (714,347)
                                                       ------------    ------------

Increase (decrease) in cash and cash equivalents            707,060      (2,480,042)

Cash and cash equivalents at beginning of period          5,769,373      11,390,903
                                                       ------------    ------------

Cash and cash equivalents at end of period             $  6,476,433    $  8,910,861
                                                       ============    ============

Cash paid during the period for:

Interest                                               $    262,000    $    123,989
                                                       ============    ============
Taxes                                                  $       --      $       --
                                                       ============    ============

Noncash investing and financing:
   Plant and equipment purchased with capital leases   $    123,883    $    705,055
                                                       ============    ============

<FN>
                 See accompanying notes to financial statements.
</FN>
</TABLE>

                                       4
<PAGE>

--------------------------------------------------------------------------------

                             RAVENSWOOD WINERY, INC.

                          NOTES TO FINANCIAL STATEMENTS

         NOTE 1 - Basis of presentation:

         The financial  statements  included herein for Ravenswood Winery,  Inc.
         (the  "Company")  have been  prepared  by the  Company,  without  audit
         pursuant to the rules and  regulations  of the  Securities and Exchange
         Commission.   In  management's  opinion,  the  interim  financial  data
         presented includes all adjustments (which include only normal recurring
         adjustments) necessary for a fair presentation. Certain information and
         footnote disclosures normally included in financial statements prepared
         in accordance with generally accepted  accounting  principles have been
         condensed or omitted pursuant to such rules and regulations.

         The results of operations for the three months ended September 30, 2000
         are not necessarily  indicative of the operating  results  expected for
         the entire fiscal year. The financial statements included herein should
         be read in conjunction with other documents the Company files from time
         to time with the  Securities  and Exchange  Commission,  including  the
         Company's Form 10-KSB for the fiscal year ended June 30, 2000.

         NOTE 2 - Significant accounting policies:

         Use of estimates

         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect  the  reported  amounts  of  assets  and
         liabilities and disclosure of contingent  assets and liabilities at the
         date of the financial statements,  and the reported amounts of revenues
         and  expenses  during  the  reporting   period.   Actual  results  when
         ultimately realized could differ from those estimates.

         Reclassification

         Certain prior period amounts have been reclassified in order to conform
         to the current period presentation.

         NOTE 3 - Earnings per share

         Basic EPS  represents  the  income  available  to  common  shareholders
         divided by the weighted average number of common shares outstanding for
         the  period.  Diluted EPS  represents  the income  available  to common
         shareholders   divided  by  the  weighted   average  of  common  shares


                                       5
<PAGE>

         outstanding  while also giving  effect to the  potential  dilution that
         could occur if  securities  or other  contracts  to issue  common stock
         (e.g.  stock options and  convertible  debentures)  were  exercised and
         converted into stock. For all periods presented, the difference between
         basic and diluted EPS for the Company is due to the dilutive  effect of
         stock  options and  convertible  debentures.  This effect is calculated
         using the treasury stock method.

         During the three month period ended September 30, 2000, 2,150 shares of
         common stock were purchased under  Ravenswood's  1999 Equity  Incentive
         Plan.


                                       6
<PAGE>

<TABLE>
         NOTE 4 - Inventories:

<CAPTION>
         Inventories are summarized as follows:    September 30,          June 30,
                                                       2000                2000
                                                 -----------------   -----------------
                                                   (Unaudited)

<S>                                                   <C>                 <C>
              Bulk wine                               $20,088,398         $15,262,865
              Bottled wine                              5,809,303           4,716,701
              Crop costs                                        0             137,051
              Supplies                                    135,452             233,943
              Tasting room merchandise                    151,546             170,724
                                                 -----------------   -----------------
                                                      $26,184,699         $20,521,284
                                                 =================   =================
</TABLE>

<TABLE>
         NOTE 5 - Property, plant and equipment:

         Property, plant and equipment are summarized as follows:

<CAPTION>
                                                             September 30,        June 30,
                                                                2000                2000
                                                          -----------------   -----------------
                                                            (Unaudited)

<S>                                                            <C>                 <C>
              Land                                               $ 245,135           $ 245,135
              Vineyards                                            345,473             345,473
              Buildings and improvements                         1,647,634           1,647,637
              Leasehold improvements                             9,869,805           9,832,748
              Machinery and equipment                            1,143,849           1,080,251
              Equipment held under capital leases                4,242,836           4,118,953
              Office equipment                                     308,886             298,837
                                                          -----------------   -----------------
                                                                17,803,618          17,569,034
              Less accumulated depreciation                      3,155,043           2,781,481
                                                          -----------------   -----------------
                                                               $14,648,575         $14,787,553
                                                          =================   =================
</TABLE>

         NOTE 6 - Comprehensive income:

         Comprehensive  income includes  unrealized  gain on  available-for-sale
         securities.  The  following  is a  reconciliation  of  net  income  and
         comprehensive income (unaudited):

                                                    For Three Months Ended
                                               --------------------------------
                                               September 30,    September 30,
                                                   2000             1999
                                                   ----             ----

         Net income                             $ 1,514,641      $ 1,497,815

         Change in unrealized gain on
           available-for-sale securities             23,824           37,567
                                               --------------   --------------
         Comprehensive income                   $ 1,538,465      $ 1,535,382
                                               ==============   ==============


                                       7
<PAGE>

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This Report contains  forward-looking  statements  within the meaning of Section
27A of the  Securities  Act of 1933,  as amended  (the  "Securities  Act"),  and
Section 21E of the  Securities  Exchange Act of 1934, as amended (the  "Exchange
Act"),  regarding  future events and Ravenswood's  plans and  expectations  that
involve risks and uncertainties. When used in this Report, the words "estimate,"
"project,"  "intend,"  "expect" and  "anticipate"  and similar  expressions  are
intended  to identify  such  forward-looking  statements.  Such  statements  are
subject to certain risks and  uncertainties,  including those  discussed  below,
that could  cause  actual  results to differ  materially  from those  projected.
Factors that may cause actual  results to vary include,  but are not limited to:
(i) future and past weather and general farming conditions  affecting the annual
grape harvest;  (ii) variations in consumer taste and preference:  (iii) changes
in the wine  industry  regulatory  environment;  and (iv)  changes in the market
value of Ravenswood's  common stock.  Other factors that may cause or contribute
to such differences include, but are not limited to, those discussed below under
"Risk Factors," as well as those  discussed  elsewhere in this Report and in the
documents  incorporated  herein by reference.  In light of the important factors
that can materially affect results,  including those set forth in this paragraph
and below,  the inclusion of  forward-looking  information  herein should not be
regarded  as a  representation  by  Ravenswood  or any  other  person  that  the
objectives  or plans for  Ravenswood  will be achieved.  The reader is therefore
cautioned  not  to  place  undue  reliance  on  the  forward-looking  statements
contained herein, which speak only as of the date hereof.  Ravenswood undertakes
no obligation to publicly release updates or revisions to these statements.

Overview

Ravenswood  produces,  markets and sells premium  California  wines  exclusively
under the Ravenswood brand name. The vast majority of wines produced and sold by
Ravenswood   are  red  wines,   including   Merlot,   Cabernet   Sauvignon  and,
particularly,  Zinfandel.  To a lesser extent,  Ravenswood produces white wines,
including  Chardonnay,  French  Colombard and  Gewurztraminer.  Ravenswood's red
wines  accounted for  approximately  94% of gross sales in the 2000 fiscal year,
with sales of Zinfandel accounting for approximately 65% of gross sales for that
period. Ravenswood believes that sales of its red wines, particularly Zinfandel,
will continue to account for a significant portion of its sales in the future.

Since its inception in 1976,  Ravenswood  has grown by increasing its production
volume and its  portfolio of wine  products.  For the fiscal year ended June 30,
2000,  Ravenswood  realized  total gross sales of $33.2 million from the sale of
412,866 cases of wine and Ravenswood branded merchandise.

The mix of products sold in any given period affects  Ravenswood's  gross profit
as a percentage of net sales,  or gross margin.  In particular,  as sales of the
value-priced  Vintners  Blend Series have  increased  as a  percentage  of gross
sales,  Ravenswood's  gross  margin  has  decreased.  The gross  margin  for the
Vintners  Blend  Series  is  traditionally   more  variable  than   Ravenswood's
higher-priced  product series because a significant  portion of the wine used in
these  products  is  purchased  in the  bulk  market  rather  than  produced  by
Ravenswood from grapes acquired from its traditional grape suppliers. Ravenswood
has no bulk wine purchase contracts.  The price,  quality and available quantity
of bulk wine have  fluctuated in the past and Ravenswood  expects that they will
continue to fluctuate in the future.

The timing for release of Ravenswood's products,  particularly its County Series
and Vineyard Designate Series, also significantly  affects Ravenswood's sales in
specific  periods.  Ravenswood  has  traditionally  released new vintages of its
Vineyard  Designate  Series in the fourth  fiscal  quarter  or the first  fiscal
quarter  of the  subsequent  fiscal  year.  For fiscal  year  2001,  many of the
Vineyard  Designates  were released in August and September,  resulting in sales
during  the  second  quarter.  In  addition,   the  release  dates  of  some  of
Ravenswood's  County Series wines fluctuate  between the third and fourth fiscal
quarters of each fiscal year.  The timing of these  release  dates is based upon
the winemakers'  determination as to the optimal flavor characteristics of these
wines and available inventory.  Fluctuation of release dates may make comparison
of  results  on a


                                       8
<PAGE>

period-to-period  basis less meaningful.  The nature of the winemaking  process,
including  the  need  for  wine  to be  aged  before  it is  released,  requires
Ravenswood to incur  significant  expenses in producing  products  which may not
generate  revenues until up to two years later.  Any factors that may prevent or
delay the sale of  Ravenswood's  wines at the prices  anticipated at the time of
their production could adversely affect its liquidity and reduce its profits.

Pricing for grapes  purchased by Ravenswood is determined  annually by reference
to benchmark price quotations or through  negotiation.  As a result, the cost of
grapes used in  Ravenswood's  wine  production has fluctuated and is expected to
continue to fluctuate.  Ravenswood has  traditionally  attempted to moderate and
stabilize  price  increases  from  year to  year.  Consequently,  gross  margins
realized by Ravenswood  have fluctuated in the past and are expected to continue
to fluctuate with the price of grapes used in production.

Within the United States, Ravenswood utilizes distributors in every state except
California.  Brokers are used to assist the sales  effort in  California  and 31
other  states.  Ravenswood  uses both  brokers and  distributors  in most of the
foreign countries in which Ravenswood's wines are sold.

Brokers  act  as  an  independent   sales  force  and  receive   commissions  as
compensation for their sales.  Brokers do not take title to the wines they sell.
Distributors purchase wine from Ravenswood and sell the wine to their own retail
accounts such as restaurants, grocery stores and wine shops.

Ravenswood primarily uses smaller,  well-positioned brokers and distributors for
whom  Ravenswood  is a key brand.  Although  Ravenswood  has very few  long-term
agreements  for  distribution  of its  products,  Ravenswood  believes  that its
relationships with existing brokers and distributors are excellent. Ravenswood's
executive  management  also  takes  an  active  role in  assisting  brokers  and
distributors  with sales within  California and within major geographic  markets
outside California.

Ravenswood sells its products directly in California,  utilizing four warehouses
throughout  the  state  and a  network  of seven  brokers.  Ravenswood  realizes
significantly  greater  gross  margins in areas,  such as  California,  where it
relies  on  direct  sales  facilitated   through  brokers  without  the  use  of
distributors.  Sales  within  California  accounted  for  approximately  45%  of
Ravenswood's gross sales in the 2000 fiscal year. Of this amount,  approximately
8% of gross sales were  purchases by  California  and  non-California  consumers
through  Ravenswood's  tasting  room and  approximately  37% of gross sales were
sales to retail accounts.  We expect similar results for fiscal 2001. Ravenswood
believes that sales within California will continue to account for a substantial
portion of its sales in the future.

Results of Operations

The  following  table sets forth items from  Ravenswood's  statement  of income,
expressed as a percentage of net sales, for the periods indicated:

                                                    Three Months Ended
                                                       September 30,
                                                       -------------
Statement of Income Data:                             2000             1999

Net Sales                                            100.0%           100.0%
Cost of Goods Sold                                    45.3             45.0
                                             -------------    -------------
Gross Profit                                          54.7             55.0
Operating Expenses                                    24.9             22.6
                                             -------------    -------------
Operating Income                                      29.8             32.4
Other Expense, net                                     1.3               .5
                                             -------------    -------------
Income Before Income Taxes                            28.5             31.9
Provision for Income Taxes                            11.5             12.4
                                             -------------    -------------
Net Income                                            17.0%            19.5%
                                             =============    =============


                                       9
<PAGE>

Three Months Ended September 30, 2000 and 1999

Sales

Net sales of Ravenswood's  products increased 15.7% to $8.9 million in the three
months ended  September  30,  2000,  from $7.7 million in the three months ended
September 30, 1999.  This increase is primarily  attributable  to an increase in
the volume of wines produced and sold by  Ravenswood.  In the three months ended
September 30, 2000,  case sales  increased to 107,537 cases from 86,687 cases in
the three months ended  September  30,  1999,  while the average  price per case
decreased  to $88.20 from  $94.37 in these  respective  periods  (based on gross
sales). The decrease in average price per case is primarily  attributable to two
factors,  the relatively  late release of the Vineyard  Designate  Series in the
first quarter of fiscal 2001,  which  resulted in lower sales of this series for
this year as  compared to the first  quarter of fiscal 2000 and the  increase in
sales of the Vintners Blend Series as a percentage of gross sales. Case sales of
Vineyard  Designate Series wines declined in the first quarter of fiscal 2001 by
31.9% over the same period in the previous  fiscal  year.  There are two reasons
for this decline. First, as discussed previously,  Vineyard Designate wines from
the 1998 vintage were  released  later in the first  quarter of fiscal 2001 than
the 1997 vintage wines which were  released in the previous  fiscal year's first
quarter.  Second,  vineyard  yields in the 1998 vintage  were lower,  due to the
effects of El Nino, than the abundant 1997 vintage.  Consequently fewer Vineyard
Designate wines will be available for sale in fiscal 2001 than in fiscal 2000.

The percentages of gross sales attributable to the Vintners Blend Series, County
Series and Vineyard  Designate Series were 59%, 23% and 17%,  respectively,  for
the three months  ended  September  30,  2000,  as compared to 50%, 21% and 27%,
respectively,  in the three months ended September 30, 1999. Sales of Ravenswood
branded merchandise accounted for approximately 1% and 2% of gross sales for the
three months ended September 30, 2000, and September 30, 1999, respectively.

Cost of Goods Sold

Cost of goods sold  increased to $4.0  million,  or 45.3% of net sales,  for the
three months ended September 30, 2000, from $3.5 million, or 45.0% of net sales,
for the  corresponding  period  in  fiscal  2000.  Cost of goods  sold  remained
relatively  unchanged despite the decrease in Vineyard Designate Series sales, a
higher margin product, due to improved margins for the Vintners Blend Series.

Gross Profit

Ravenswood's  gross profit  increased to $4.9 million for the three months ended
September 30, 2000,  from $4.3 million for the three months ended  September 30,
1999,  and  decreased as a percentage  of net sales to 54.7% from 55.0% in these
respective  periods.  The  increase  in  aggregate  gross  profit  is  primarily
attributable to increases in sales volumes.


                                       10
<PAGE>

Operating Expenses

Operating  expenses  increased  to $2.2  million  for  the  three  months  ended
September 30, 2000,  from $1.7 million for the three months ended  September 30,
1999,  and  increased as a percentage  of net sales to 24.9% from 22.6% in these
respective  periods.  The  increase  in the  amount  of  operating  expenses  is
attributable  to increased sales volumes.  Increased  sales volumes  resulted in
increased  brokerage  commissions  as well as increases in  Ravenswood's  sales,
administrative and warehouse staffs.  Operating expenses, as a percentage of net
sales, have increased and will continue to increase as Ravenswood  completes its
move into the Quarry Facility,  as additional  personnel are added that were not
previously  hired  due to lack of  space  and  facility,  and as it  adjusts  to
maintaining two operating plants with administrative offices.

Other Expense, Net

Other expense includes  non-operating  income and expense items, which primarily
consist of interest on outstanding  debt. Other expense amounted to $113,095 and
$37,970,  or 1.3% and .5% of net sales,  in the three months ended September 30,
2000, and 1999, respectively.  The increase in other expense is due primarily to
an increase in interest  expense on funds borrowed to build the Quarry  Facility
and  to  purchase  equipment  installed  there.  Additionally,  interest  income
generated  from invested  proceeds of the December,  1998 private  placement and
April,  1999  initial  public  offering  which had  previously  offset  interest
expense, has decreased as Ravenswood has used those funds to complete the Quarry
Facility and as operating  capital. A portion of the decrease in interest income
has been offset by income  generated  through  custom crush and custom  bottling
fees.

Provision for Income Taxes

The provision for income taxes  reflects an estimated  annualized  effective tax
rate of 40.2% for the three months ended  September 30, 2000,  and 38.9% for the
corresponding period in fiscal 2000. The slight increase is due to the effect of
manufacturer's tax credit taken for the first quarter of fiscal 2000.

                                       11
<PAGE>


<TABLE>
Selected Quarterly Results of Operations

The following table presents  Ravenswood's results of operations for each of the
six quarters  prior to and including the quarter ended  September 30, 2000.  The
quarterly information is unaudited, but management believes that the information
regarding  these  quarters  has been  prepared  on the same basis as the audited
financial  statements appearing in the Company's Form 10-KSB for the fiscal year
ended June 30, 2000. In the opinion of  management,  all  necessary  adjustments
which include only normal  recurring  adjustments  have been included to present
fairly  the  unaudited  quarterly  results  when  read in  conjunction  with the
financial  statements and related notes appearing  elsewhere in this Form 10-QSB
filing.

<CAPTION>
                                                                               Quarter Ended
                                                                              (In Thousands)
                                    -----------------------------------------------------------------------------------------
                                       June 30,     September 30,  December 31,     March 31,      June 30,     September 30,
                                         1999           1999           1999           2000           2000           2000
                                         ----           ----           ----           ----           ----           ----
<S>                                 <C>            <C>            <C>            <C>            <C>            <C>
Statement of Income Data:
Gross Sales                         $    6,119     $    8,289     $   10,437     $    8,692     $    8,197     $    9,607
 Less Excise Taxes                         361            335            199            326            404            331
 Less Discounts, Allowance
    and Returns                            234            262            315            239            309            378
                                    ----------     ----------     ----------     ----------     ----------     ----------
Net Sales                                5,525          7,692          9,924          8,127          7,484          8,898
Cost of Goods Sold                       2,788          3,463          4,814          3,897          3,522          4,033
                                    ----------     ----------     ----------     ----------     ----------     ----------
Gross Profit                             2,737          4,229          5,110          4,230          3,961          4,865
Other Operating Expenses                 1,503          1,740          2,001          1,832          2,162          2,217
                                    ----------     ----------     ----------     ----------     ----------     ----------
Operating Income                         1,234          2,489          3,108          2,398          1,799          2,648
Other (Income) Expense                    (12)             38            160            205            186            113
                                    ----------     ----------     ----------     ----------     ----------     ----------
Income Before Income Taxes               1,247          2,451          2,947          2,192          1,613          2,535
Provision for Income Taxes                 385            953          1,168            875            370          1,020
                                    ----------     ----------     ----------     ----------     ----------     ----------
Net Income                          $      862     $    1,498     $    1,780     $    1,317     $    1,243     $    1,515
                                    ==========     ==========     ==========     ==========     ==========     ==========
</TABLE>

Ravenswood  experiences seasonal and quarterly  fluctuations in sales, operating
expenses  and net income.  Because  Ravenswood  manages its  business to achieve
long-term  strategic  objectives,  it may make  decisions  that it believes will
enhance  its  long-term  growth  and  profitability,  even  if  these  decisions
adversely  affect  quarterly  earnings.  These  decisions  include:  (a) when to
release its wines for sale; (b) how to position its wines competitively; and (c)
which grape and bulk wine sources to use to produce its wines. In addition,  the
release dates of Ravenswood's  Vineyard  Designate Series and County Series have
resulted in fluctuations in Ravenswood's results on a quarter-to-quarter  basis.
Ravenswood's  sales  volume may also  change  depending  upon its  distributors'
inventory levels.  The results of operations for any quarter are not necessarily
indicative of the results of any future period. The market price of Ravenswood's
common stock may fluctuate significantly in response to these quarter-to-quarter
variations.


                                       12
<PAGE>

FINANCIAL CONDITION

Assets

Ravenswood's  total assets  increased by 15.3% to $53.2 million at September 30,
2000, from $46.2 million, at June 30, 2000.  Accounts  receivable  increased 30%
from $4.2  million at June 30,  2000 to $5.4  million  at  September  30,  2000.
Ravenswood's  inventory  increased by 27.6% or $5.7 million to $26.2  million at
September  30, 2000,  from $20.5 million at June 30, 2000.  Property,  plant and
equipment,  net of depreciation,  decreased  slightly from $14.8 million at June
30, 2000, to $14.6 million at September 30, 2000.

Liabilities

Ravenswood's total liabilities increased 34.6% to $21.3 million at September 30,
2000,  from $15.9  million at June 30, 2000.  The increase was  primarily due to
purchases for grapes  received in August and September of 2000,  which increased
accounts payable by 149.5% or $4.8 million. At September 30, 2000,  Ravenswood's
long-term  liabilities  outstanding  was  $11.0  million  and $2.0  million  was
available under the terms of Ravenswood's line of credit.

Liquidity and Capital Resources

Ravenswood  has funded its capital  requirements  primarily with cash flows from
operations,  a mix of short-term and long-term  borrowings,  and the sale of its
securities,  most recently with its initial public offering in April, 1999. Cash
and cash equivalents  totaled $6.5 million at September 30, 2000, as compared to
$5.8 million at June 30, 2000. The slight increase in cash and cash  equivalents
is  primarily  due to cash  generated  from  operations  and receipt of the last
installment of Ravenswood's construction loan from Pacific Coast Farm Credit.

Net cash  provided by  operations  was $1.0  million for the three  months ended
September 30, 2000, as compared to $336,754 for the three months ended September
30, 1999.  The  principal  uses of cash from  operations in this period were the
acquisition of additional inventory through grape purchases and funding accounts
receivable,  while the  principal  sources of cash were net income and  accounts
payable.

Net cash used for  investing  activities  totaled  $110,701 for the three months
ended September 30, 2000, as compared to $2.1 million for the three months ended
September 30, 1999.  During the first quarter of fiscal 2000,  Ravenswood was in
the  process  of  building  its  Quarry  Facility  and  therefore  cash used for
investing  activities  was much larger than for the same  period  during  fiscal
2001.  Ravenswood  expects  that net cash  used for  investing  activities  will
increase in the future due to the  expansion of its barrel  storage  capacity at
the Quarry Facility.

Net cash used by  financing  activities  was $196,953 for the three months ended
September 30, 2000, as compared to $714,347 for the three months ended September
30, 1999. The principal use of cash during these periods was to repay short-term
borrowings  on the  revolving  line of credit and the  principal  source of cash
during these periods was proceeds from long-term debt.

Ravenswood's grape purchases  normally occur in the second fiscal quarter,  when
the fruit is harvested.  For the 2000 harvest,  approximately half the estimated
expected  tonnage was  received in August and  September  of 2000,  or the first
quarter of fiscal 2001.  Ravenswood  expects to receive the other estimated half
in October  and  November of 2000.  Most grape  purchase  contracts  specify the
timing of payment for these  purchases.  The actual payment dates vary depending
upon the  terms of the  individual  contract.  Based  upon  its  grape  purchase
contracts  for


                                       13
<PAGE>

the 1999 harvest, these payments were made in the following manner: 42%, 29% and
17% in the second, third and fourth quarters of fiscal 2000,  respectively,  and
the  remaining  12% in the first  quarter of fiscal 2001. As a result of harvest
costs and the  timing of grape and bulk  wine  purchase  payments,  Ravenswood's
inventory  and related  cash  requirements  generally  peak during the second or
third fiscal quarters. Cash requirements also fluctuate depending upon the level
and timing of capital spending and tax payments.

Ravenswood  leases  barrels and other  equipment  used in the  production of its
wines.  Ravenswood estimates that aggregate lease payments for barrels and other
equipment will be  approximately  $625,000 for the 2001 fiscal year.  Ravenswood
anticipates  that it will  enter  into  additional  leasing  arrangements  as it
increases its production.

The holders of $815,000 in  convertible  debentures  issued in 1994 converted to
285,250 shares of Ravenswood  common stock in December,  1999. If the debentures
had not converted,  Ravenswood would have been able to redeem them at face value
at any time during the period  beginning on January 1, 2000 and ending  December
31, 2004.

In  December  1998,  Ravenswood  completed  a private  sale of $1.7  million  of
convertible  debentures  due December 31, 2008 and $1.7 million of common stock.
Each  $10,000  debenture is  convertible  into 900 shares of common stock at any
time prior to December 31, 2003,  upon request of the holder.  If the debentures
are not  converted,  Ravenswood may redeem them at face value at any time during
the period  from  January  1, 2004  until the  maturity  date.  Ravenswood  pays
interest  quarterly on the  debentures in an amount equal to the prime  interest
rate  quoted by Bank of America  NT&SA plus 1%. The  interest  rate is  adjusted
every 18 months,  except  that in no period  may the  interest  rate  adjustment
exceed 2%, or the maximum interest rate exceed 11%.

Ravenswood  has a line of credit with  Pacific  Coast Farm  Credit  Association,
under which  Ravenswood may borrow up to a total of $2 million.  As of September
30, 2000, Ravenswood had nothing outstanding under this line of credit.

On April 26, 1999  Ravenswood  obtained a $4.6  million  construction  loan from
Pacific Coast for the purpose of financing  construction of the Quarry Facility.
The loan is secured by the Quarry  Facility and its lease.  The Quarry  Facility
was completed  during fiscal 2000 at a cost of approximately  $9.7 million.  The
remaining  costs of  approximately  $5.1 million were funded from the  December,
1998,  private  equity  offering and proceeds from  Ravenswood's  initial public
offering in April, 1999.  Equipment worth  approximately $3.3 million was funded
through capital leases as of June 30, 2000.

In April, 1999,  Ravenswood  completed an initial public offering of one million
shares of its  common  stock at a price of $10.50 per share.  W.R.  Hambrecht  &
Company,  LLC acted as underwriter  for the offering.  The net proceeds from the
offering  have  been  and  will  continue  to be used  for:  investment  in wine
inventory,  expansion of production facilities,  general corporate purposes, and
retirement  of  indebtedness.  Ravenswood's  shares  are  listed  on the  Nasdaq
National Market under the trading symbol RVWD.

The full extent of Ravenswood's future capital  requirements and the adequacy of
its  available  funds  will  depend  on many  factors,  not all of which  can be
accurately  predicted.  Although no assurance can be given,  Ravenswood believes
that anticipated cash flow from operations, borrowings under its existing credit
agreements,  proceeds from its initial public offering and the private placement
in 1998 described  above,  will be sufficient to fund its capital  requirements,
including its planned  expansion,  for at least the next 12 months. In the event
that additional  capital is required,  Ravenswood may seek to raise that capital
through public or private  equity or


                                       14
<PAGE>

debt financings.  Future capital funding  transactions may result in dilution to
shareholders.

There can be no assurance that additional capital will be available on favorable
terms,  if at all.  Ravenswood's  inability  to  obtain  additional  capital  on
acceptable  terms would limit its growth and could have a negative impact on its
business. Ravenswood uses substantial amounts of its working capital to purchase
grapes  and bulk wine  supplies  from  third  parties  and to pay for the use of
third-party  production facilities in its wine production.  Ravenswood also uses
capital to fund its own  grape-growing  and  winemaking  activities.  Ravenswood
expects that it will need an increased  amount of working  capital over the next
several years to fund increases in its production level and inventory.

FACTORS THAT MAY AFFECT RESULTS

A reduction in consumer demand for premium red wines could harm our business

Because a large  percentage  of the wines we  produce  are  premium  red  wines,
including Merlot, Cabernet Sauvignon and, in particular, Zinfandel, our business
would be harmed if consumer  demand for red wines in general,  or  Zinfandel  in
particular,  failed to grow or declined. An overall reduction in consumer demand
for premium wine would also harm our business.

A  reduction  in the  supply of grapes  and bulk wine  available  to us from the
independent  grape growers and bulk wine  suppliers on whom we rely could reduce
our annual production of wine

We rely on  annual  contracts,  some of which are not in  writing,  with over 80
independent growers to purchase substantially all of the grapes used in our wine
production. We cannot provide assurance that we will be able to contract for the
purchase of grapes at  acceptable  prices from these or other  suppliers  in the
future. The terms of many of our purchase  agreements also constrain our ability
to discontinue  purchasing grapes in circumstances where we might want to do so.
Those  agreements  typically  provide that, while either party may terminate the
agreement  at any time,  both  parties  must  continue to abide by its terms for
three years following termination.

We are  dependent on bulk wine  suppliers  for the  production of several of our
wines,  particularly  our Vintners  Blend Series.  We do not have contracts with
bulk wine suppliers or agreements that would protect us from fluctuations in the
price or  availability  of bulk wine.  The  availability  and price of bulk wine
significantly  affect the quality and  production  levels of our  products  that
contain bulk wine. The price,  quality and available  quantity of bulk wine have
fluctuated in the past. It is possible that we will not be able to purchase bulk
wine of acceptable  quality at acceptable  prices and  quantities in the future,
which could  increase the cost or reduce the amount of wine we produce for sale.
This could cause reductions in our sales and profits.

Bad weather, plant diseases,  pests, including the glassy-wing  sharpshooter and
other  factors  could  reduce  the  amount or  quality  of the grapes we need to
produce our wines

A shortage in the supply of quality grapes may result from the occurrence of any
number of the factors which  determine the quality and quantity of grape supply,
such as weather  conditions,  pruning  methods,  the  existence  of diseases and
pests,  and the  number  of  vines  producing  grapes,  as well as the  level of
consumer  demand for wine.  Any shortage could cause an increase in the price of
some or all of the grape  varieties  required for our wine  production  and/or a
reduction  in the amount of wine we are able to  produce,  which  could harm our
business and reduce our sales and profits.

For example, due to the effects of El Nino, the grape supply available to us for
the 1998  harvest


                                       15
<PAGE>

was lower than for the 1997  harvest,  which we believe was an  unusually  large
harvest.  Therefore,  the inventory of our 1998 vintage may be less than that of
our 1997 vintage.  As a result, the growth of our sales may be limited in fiscal
year 2001, when a portion of our 1998 vintage will be released for sale.

Factors which reduce the quantity of grapes may also reduce their quality, which
in turn could reduce the quality or amount of wine we produce.  A  deterioration
in the  quality of our wines  could harm our brand  name,  and a decrease in our
production could reduce our sales and profits.

Although  we grow only a small  portion of the grapes we use,  our  business  is
still subject to numerous  agricultural risks. Most of the vineyards that supply
our grapes are  primarily  planted to  rootstocks  believed to be  resistant  to
Phylloxera,  a pest that feeds on  susceptible  grape  rootstocks.  We  purchase
grapes from regions in California in which the  glassy-winged  sharpshooter has,
or may be encountered.  The  glassy-winged  sharpshooter  can transmit  Pierce's
Disease to vineyards.  This disease is often fatal to wine grape vines. To date,
our access to supplies of grapes and bulk wine has not been negatively  impacted
by the spread of the glassy-winged sharpshooter or Pierce's Disease. However, we
cannot be certain that these vineyards, or vineyards from which we obtain grapes
in the  future,  will not  become  susceptible  to  current  or new  strains  of
Phylloxera, plant insects, such as the glassy-winged sharpshooter,  or diseases,
such as Pierce's Disease.  Any resulting  reduction in grape supply could reduce
our sales and profits.

An oversupply  of grapes may also harm our business by increasing  the supply of
wine sold by our competitors

The recent  increase in demand for premium  wine has resulted in the planting of
additional vineyards, both domestically and internationally,  and the replanting
of existing vineyards to greater densities,  which could result in a significant
increase  in the supply of premium  wine  grapes.  An  oversupply  of grapes may
significantly  increase the amount of premium wine produced.  An increase in the
supply of premium wines could harm our business  because we only produce premium
wines.  Oversupply may also increase the amount of premium wine available to our
distributors  and  retail  outlets,  which  would  increase  competition  in our
distribution channels.

The loss of Mr.  Foster,  Mr.  Peterson or other key employees  would damage our
reputation and business

We believe that our success  largely  depends on the  continued  employment of a
number of our key  employees,  including W. Reed Foster,  our chairman and chief
executive  officer,  and Joel E.  Peterson,  our  president and  winemaker.  Any
inability or unwillingness  of Mr. Foster,  Mr. Peterson or other key management
team members to continue in their present capacities could harm our business and
our reputation.  For instance,  if Mr.  Peterson's  relationship with Ravenswood
were to terminate for any reason,  we would need to find a successor  winemaker.
We cannot be  certain  that we could  find or hire a  successor  winemaker  with
skills equivalent to those of Mr. Peterson.

Because a significant  amount of our sales is made through brokers,  a change in
our relationship with any of them could harm our business

In the 2000 fiscal year,  approximately 75% of our gross sales were made through
brokers.  A change in our  relationship  with any of our brokers  could harm our
business and reduce our sales.  Our most  successful  broker was responsible for
21% of our gross  sales in the 2000  fiscal  year,  and our ten most  successful
brokers were responsible for 69% of our gross sales in the 2000 fiscal year.


                                       16
<PAGE>

Because some states have laws that prohibit  distributors changes, our sales may
be reduced if we cannot replace an under-performing distributor

Our sales outside of California  largely depend on the use of distributors.  Our
ten largest distributors  accounted for approximately 23% of our gross sales for
the 2000 fiscal year,  and we expect that sales to our ten largest  distributors
will continue to represent a substantial portion of our sales in the future. The
laws and regulations of several states prohibit distributor changes except under
limited  circumstances.  As a  result,  it may be  difficult  for us to  replace
distributors  that do not  perform  adequately,  which may  reduce our sales and
profits.

Our  business  may be harmed if our  distributors  fail to market  our  products
effectively

We depend largely on our distributors in areas outside  California to market our
products to the restaurants and retail outlets they service.  Other premium wine
producers,  as well as the producers of alternative  beverages,  compete for our
distributors'  marketing resources.  A failure by our distributors to market our
products as effectively as they, or other distributors,  market our competitors'
products could harm our business.

The market price of our stock may fluctuate due to seasonal  fluctuations in our
wine sales, operating expenses and net income

We experience seasonal and quarterly  fluctuations in sales,  operating expenses
and net income.  We have managed,  and will continue to manage,  our business to
achieve long-term objectives. In doing so, we may make decisions that we believe
will enhance our  long-term  profitability,  even if these  decisions may reduce
quarterly earnings.  These decisions include:  (a) when to release our wines for
sale; (b) how to position our wines competitively;  and (c) which grape and bulk
wine  sources to use to produce  our wines.  In  addition,  fluctuations  in our
distributors'  inventory  levels may affect  our sales  volume.  These and other
factors relating to seasonality and business decisions may cause fluctuations in
the market price of our common stock.

We also compete with popular, low-priced "generic" wines and with beer and other
alcoholic  and  non-alcoholic  beverages  both  for  demand  and for  access  to
distribution channels

Many of the  producers  of  these  beverages  also  have  significantly  greater
financial,  technical,  marketing and public relations resources than we do. Our
sales may be harmed to the extent any alternative  beverages are introduced that
compete with wine. We may not be able to compete successfully against these wine
or alternative beverage producers.

A reduction  in our access to, or an  increase  in the cost of, the  third-party
services we use to produce our wine could harm our business

We utilize third-party  facilities,  of which there is a limited supply, for the
production  activities associated with our wines. Our inability in the future to
use these or  alternative  facilities,  at  reasonable  prices or at all,  could
increase the cost or reduce the amount of our production, which could reduce our
sales and our profits.  We do not have  long-term  agreements  with any of these
facilities.   The  activities  conducted  at  outside  facilities  include:  (a)
crushing;  (b) fermentation;  (c) storage; (d) blending;  and (e) bottling.  Our
reliance  on these  third-parties  varies  according  to the type of  production
activity.  As  production  increases,   we  may  continue  to  rely  upon  these
third-party production facilities. Reliance on third-parties will also vary with
annual harvest volumes.


                                       17
<PAGE>

A failure to complete the expansion of our facilities as planned could limit our
production of wine and harm our business

We recently completed Phase I of our production  facility,  the Quarry Facility,
and are currently  utilizing it to full capacity.  We are currently  planning to
expand the Quarry Facility,  in order to increase our production  capacity.  Our
failure to complete the expansion of the Quarry  Facility,  or otherwise  expand
our production capabilities,  would limit our production capacity, would require
greater use of  third-party  production  facilities  and could  reduce our sales
and/or  profits.  We expect to utilize the entire Quarry Facility fully upon the
completion of the contemplated  expansion. As a result, any further expansion of
our production capacity may require us to use third-party  production facilities
or to continue to expand our own production capacity.  Our failure to expand our
production  capacity,  or to  secure  capacity  from  third-parties,  either  at
acceptable  prices or at all,  could limit our  production  and reduce our sales
and/or profits.

Adverse public opinion about alcohol may harm our business

In recent  years,  activist  groups have used  advertising  and other methods to
inform the public about the societal harms  associated  with the  consumption of
alcoholic  beverages.  These  groups  have also  sought,  and  continue to seek,
legislation to reduce the availability of alcoholic  beverages,  to increase the
penalties associated with the misuse of alcoholic beverages,  or to increase the
costs  associated with the production of alcoholic  beverages.  Over time, these
efforts  could cause a  reduction  in the  consumption  of  alcoholic  beverages
generally, which could harm our business and reduce our sales and profits.

While a number of research studies suggest that moderate alcohol consumption may
provide various health benefits,  other studies conclude or suggest that alcohol
consumption has no health  benefits and may increase the risk of stroke,  cancer
and other  illnesses.  An  unfavorable  report on the health  effects of alcohol
consumption could significantly reduce the demand for wine, which could harm our
business and reduce our sales and profits.

Contamination of our wines would harm our business

Because our products are designed for human consumption, our business is subject
to hazards and liabilities  related to food products,  such as contamination.  A
discovery of contamination in any of our wines,  through tampering or otherwise,
could result in a recall of our products.  Any recall would significantly damage
our  reputation  for product  quality,  which we believe is one of our principal
competitive assets, and could seriously harm our business and sales. Although we
maintain  insurance  to  protect  against  these  risks,  we may  not be able to
maintain insurance on acceptable terms and this insurance may not be adequate to
cover any resulting liability.

Increased regulatory costs or taxes would harm our financial performance

The wine  industry is regulated  extensively  by the Federal  Bureau of Alcohol,
Tobacco and  Firearms,  various  foreign  agencies,  and state and local  liquor
authorities. These regulations and laws dictate various matters, including:

         o        Excise taxes

         o        Licensing requirements

         o        Trade and pricing practices

         o        Permitted distribution channels

         o        Permitted and required labeling

         o        Advertising


                                       18
<PAGE>

         o        Relationships with distributors and retailers

Recent and future zoning ordinances,  environmental restrictions and other legal
requirements may limit our plans to expand our production  capacity,  as well as
any future development of new vineyards and wineries. Future legal or regulatory
challenges  to the wine  industry  could also harm our  business  and impact our
operating results.

Because our  directors and officers have  significant  control over  Ravenswood,
other  investors do not have as much  influence  on corporate  decisions as they
would if control were less concentrated

Assuming all convertible debentures held by our directors and executive officers
and their respective  affiliates will be converted,  and all options exercisable
within 60 days of the date hereof by our directors and executive officers,  will
be  exercised,  our  directors  and  executive  officers  and  their  respective
affiliates  would   beneficially  own  2,230,476  shares  of  common  stock,  or
approximately   45.2%  of  our   outstanding   common  stock  and  common  stock
equivalents.  As a  result,  our  directors  and  executive  officers  and their
respective  affiliates have  significant  influence in the election of directors
and the  approval of  corporate  actions  that must be  submitted  for a vote of
shareholders.  The interests of these persons may conflict with the interests of
other  shareholders,  and the  actions  they take or approve  may be contrary to
those desired by the other  shareholders.  This  concentration  of ownership may
also have the effect of delaying,  preventing  or deterring  an  acquisition  of
Ravenswood by a third party.

Natural disasters,  including earthquakes or fires, could destroy our facilities
or our inventory

California experiences earthquake activity from time to time, such as the recent
earthquake in Napa. The Gehricke Road Facility,  the Quarry  Facility and all of
the  third-party  facilities we use to produce and store our wine are located in
areas that are subject to  earthquake  activity.  If we lost all or a portion of
our wine prior to its sale or distribution  as a result of earthquake  activity,
we would lose our  investment in, and  anticipated  profits and cash flows from,
that wine.  Such a loss would  seriously  harm our business and reduce our sales
and profits.

In  addition,  we must  store our wine in a limited  number of  locations  for a
period of time prior to its sale or distribution. Any intervening catastrophies,
such as a fire,  that result in the  destruction of all or a portion of our wine
would result in a loss of our  investment in, and  anticipated  profits and cash
flows from,  that wine. Such a loss would seriously harm our business and reduce
our sales and profits.

Our small  market size and  relatively  low trading  volume may limit the market
price, liquidity or trading volume of our stock

Our small  size and  relatively  low  trading  volume  may  reduce the amount of
research coverage from market analysts. This reduced level of coverage may limit
the market price, liquidity or trading volume of our common stock.

Risks associated with potential Year 2000 problems

Even though to date  Ravenswood  has not  experienced an adverse impact from the
transition  to the Year  2000,  Ravenswood  cannot  provide  assurance  that its
suppliers  and  customers  have not been  affected  in a manner  that is not yet
apparent.  As a  result,  Ravenswood  will  continue  to  monitor  its Year 2000
compliance and the Year 2000 compliance of its suppliers and customers.


                                       19
<PAGE>

                             RAVENSWOOD WINERY, INC.

                           PART II. OTHER INFORMATION

Item 2. Changes in Securities and Use of Proceeds

<TABLE>
The following  table  describes the use of proceeds  from  Ravenswood's  initial
public offering in April, 1999.

(IN THOUSANDS)

<S>                                                                    <C>
Effective Date of the Company's Registration Statement:                April 8, 1999
Commission File Number                                                 333-71729
Date Offering Commenced:                                               April 9, 1999
Date Offering Completed:                                               Upon the sale of all the
                                                                         shares registered
Names of Managing Underwriters:                                        W. R. Hambrecht & Co., LLP
Class of Securities Registered:                                        Common Stock
Shares Registered and Sold:                                            1,000*
Sold by Company:                                                       1,000*
Sold by Shareholders:                                                  0
Aggregate Price of Offering Amount Registered and Sold:                $10,500
Gross Proceeds to Company:                                             $10,500
Gross Proceeds to Selling Shareholders                                 0
Underwriter's Discounts and Commission Charged to the Company:         $420
Other issuance costs:                                                  $546
Net offering proceeds to the Company:                                  $9,534
Approximate use of net offering proceeds through September 30,
   2000:
         Working capital                                               $1,265
         Retirement of debt                                            $1,000
         Expansion of production facilities                            $3,350

<FN>
-----------

*In  connection  with  the  initial  public  offering,  Ravenswood  granted  the
underwriters an over-allotment  option to purchase 150,000  additional shares of
Ravenswood's  common stock at the original  initial public offering  price.  The
option was not exercised.
</FN>
</TABLE>

Item 6. Exhibits and Reports on Form 8-K

(a)      Exhibits.

         Exhibit Number
         --------------
               27.1                      Financial Data Schedule

(b)      Reports on Form 8-K.

         None.


                                       20
<PAGE>

                             RAVENSWOOD WINERY, INC.

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized.


Dated: November 13, 2000                   Ravenswood Winery, Inc.

                                           /s/Callie S. Konno
                                           -------------------------------------
                                              Callie S. Konno
                                              Chief Financial Officer

Dated: November 13, 2000

                                           /s/W. Reed Foster
                                           -------------------------------------
                                              W. Reed Foster
                                              Chairman of the Board and Chief
                                              Executive Officer


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