Press Centre

Xaar plc (“Xaar”), the inkjet printing technology group headquartered in Cambridge, has announced its audited results for the year ended 31 December 2005.

KEY POINTS :

• Results reflect a year of excellent progress with growth in revenues, margins and profits.
• Reported under IFRS, the financial results for the year were:

• Turnover was up 23% to £42.8m (2004: £34.8m);
• Profit before tax* jumped 69% to £11.0m (2004: £6.5m);
• Operating profit was up 66% to £10.5m (2004: £6.3m);
• Operating profit margins improved to 24% (2004: 18%);
• Adjusted basic earnings per share* increased 62% to 12.8p (2004: 7.9p); and
• Net cash and cash equivalents at 31 December 2004 were £14.4m (2004: £15.3m).

* stated before non-trading foreign exchange movements on inter-company loan: loss of £1.0m (2004: loss of £0.2m)

• Cash investment in the business during the second half of 2005 included initial spend on the new manufacturing plant, increased working capital to support expanded level of business and funding of purchase of Xaar shares for staff share incentive plans.
• Proposed annual dividend per share increased 50% to 1.5p (2004: 1.0p).
  New manufacturing plant is to be located in Huntingdon, Cambridge and is scheduled to commence production by the end of 2006.  Planned investment of £10m will create initially 30 new jobs.

On outlook, Chairman, Arie Rosenfeld stated:

“Our sales of established products continue to grow and our new products launched in 2006 will add growth in the medium term.  For the longer term we have further new products due for commercial launch in 2007, together with an expanding range of applications ready to adopt them.”

“The Board looks forward to another year of positive results in 2006.”

For more information, please contact:

Alex Challinor, Xaar plc
T: +44 (0)1223 423663
achallinor@xaar.co.uk
www.xaar.co.uk

Xaar plc: 01223-423663
Nigel Berry, Group Finance Director & Deputy Chief Executive
W: www.xaar.co.uk

Bankside Consultants: 020-7367-8883 / 07802-888159
Steve Liebmann