British film-maker returns pounds 1m lottery grant as he hits jackpot at box office

A bored chartered accountant set up a film company. A former comedy double act came up with a script. The bizarre plot concerns two Americans living inside a London gasometer. And the end result looks like being one of the biggest British hits since Four Weddings and a Funeral.

Shooting Fish, a cult hit at the Cannes Film Festival, has become the first film part-financed by the National Lottery to return its pounds 980,000 lottery handout because it has already gone into profit - three months before its official release.

The north American rights for the romantic comedy starring, British actress Kate Beckinsale and Americans Stuart Townsend and Dan Futterman, have been bought by Fox Searchlight Pictures.

Yesterday executive producer Gary Smith announced he was returning the pounds 980,000 award as he is obliged to do when a lottery-financed film recoups its costs. The $3m (pounds 1.8m) movie has already made $4m in worldwide sales. His is the only one of the 62 films financed by the lottery to make a profit so far - and, astonishingly, the film has not yet opened anywhere in the world.

Gary Smith, 40, a former accountant with Coopers & Lybrand, set up his film company Winchester Multimedia four years ago. At Cannes he co-ordinated a campaign for his film which included T-shirts, badges, CD-Roms and a word of mouth promotion one couldn't miss. Unofficial screenings were packed out.

The film also contains an oddity which reflects his background - product placement by a firm of accountants. The climax of the film is the accountancy firm KPMG's sponsored horse race, with Peter O'Sullivan commentating.

"I always wanted to run my own company. Gary Smith said yesterday: The British Film Industry has always lacked financial discipline and strong marketing. I have brought both. I suppose it is just about more interesting than being a chartered accountant."

The creative team is headed by director Stefan Schwartz and producer Richard Holmes, who started as a comedy double act, the Gruber Brothers, at York University 10 years ago.

The president of Fox Searchlight Pictures, Lindsay Law, said: "We found it to be a wonderfully clever film with real commercial potential. What clinched it for us, however, was Winchester's tremendous marketing preparation for the movie." Gary Smith's marketing strategy includes the release of the sound track by the team responsible for the Trainspotting sound track - with one of the bands used, Passion Star, signed to Winchester's record label, part of Smith's tactic of integrating marketing activities.

Filmed entirely in Britain, Shooting Fish follows the fortunes of two 20-somethings who aim to fleece the rich but are turned by the more altruistic Kate Beckinsale into Nineties Robin Hoods.

The Arts Council has agreed to help fund with lottery money the next two projects from Winchester Films, Raving Beauties starring Steve Coogan, and An Inch over the Horizon, with Bob Hoskins.

Gary Smith said he opposed lottery money going to established commercial filmmakers. "Those people who just bleat and moan about the lack of support, and call for tax breaks for the film industry should do what we do - get off their backsides and do some hard work."