Final Results

13th December 2005

                            IMAGE SCAN HOLDINGS PLC                            

                        ("Image Scan" or the "Company")                        

           PRELIMINARY RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2005            

Image Scan Holdings (AIM:IGE), a leading provider of 3D and multi-view, X-ray
imaging technologies for the security and industrial inspection markets, today
announces preliminary results for the year ended 30 September 2005.

Key Points

  * Sales of £843,000 up by 98% (2004: £425,000);
   
  * Gross profit of £399,000 more than doubled (2004: £186,000);
   
  * Group loss before tax of £722,000 substantially reduced (2004: £1,255,000);
   
  * Basic and diluted loss per ordinary share at 2.7p (2003: 6.3p);
   
  * The Board and sales management teams have been strengthened;
   
  * Repeat sales such as those to Johnson Matthey accounting for the majority
    of turnover;
   
  * Renewed relationship with Rapiscan in October 2005 giving rise to early
    revenue of £345,000;
   
  * A new explosives ordnance security product TPXi was launched in November
    2005;
   
  * Year end order book of £326,000 (2004: £nil), rising to £684,000 by the end
    of October 2005.
   
Peter Woods, Chairman of Image Scan Holdings Plc, commented:

"During the year we concentrated on broadening our industrial customer base and
are currently in discussion with over twenty companies. We launched TPXi, our
new security product targeted at explosives and ordnance detection, in November
2005 at the Milipol exhibition in Paris. The market reaction at Milipol and
since the launch has been extremely positive. We believe the significant
achievements of 2005 will continue into 2006."

For further information:

Nicholas Fox      (Chief Executive)                   01664 503 600            
Peter Woods       (Chairman)                                                   
                                                                               
Toby Hall         (GTH Communications)                020 7153 8039            
                                                                               
Howard Drummon    (Keith Bayley Rogers Ltd)           020 7871 2232            

CHAIRMAN'S STATEMENT

INTRODUCTION

The year to 30th September 2005 was one of substantial progress. During the
year the management team has been strengthened, we have seen a sharp growth in
industrial sales, the relationship with Rapiscan has been revitalised, and we
have completed the development of and launched our portable security product
TPXi.

FINANCIAL RESULTS

I am pleased to report that our turnover was almost double the prior year at £
843,000 (2004: £425,000) with the industrial sector accounting for 82% and
security for 18%.

Administrative costs in 2005 have been reduced on a like-for-like basis by 13%
compared with 2004 and were £1,116,000 (2004: £1,448,000, which included the
write-off of certain patent costs amounting to £162,000). The benefits of these
savings will continue into future years. R&D expenditure increased by 8% to £
128,000.

The pre-tax loss for the year was significantly reduced to £722,000 (2004: £
1,255,000), with substantial improvement from a loss of £542,000 in the first
half to one of £180,000 in the second half of the year.

Following the successful placing and open offer, which raised £932,000 net of
costs, we have reduced loan funding by £237,000 and increased cash balances to
£154,000 (2004 £50,000).

SIGNIFICANT EVENTS

The most significant operational events in the year were:

  * Following a major review of world-wide sales and marketing strategy,
    initiated after the April 2005 fund-raising, we have identified and
    clarified those market opportunities with the greatest potential. We have
    appointed an Industrial Products Sales Manager, a Marketing Manager and a
    Project Manager, and discussions are well advanced for the appointment of
    two world-wide distributors, to take full advantage of these opportunities.
   
  * Repeat sales, such as those announced to Johnson Matthey and other USA
    clients in the automotive market, accounted for the majority of our
    turnover and confirmed the validity of our 2D/3D technology in the
    industrial inspection sector. Sales of stand-alone batch inspection
    equipment systems using Image Scan X-Line x-ray camera technology and
    multi-station industrial inspection systems such as the MDXi product range,
    have progressed well.
   
  * During the year we concentrated on broadening our industrial customer base
    and are currently in discussion with over twenty companies with sound
    industrial sector potential. These present good prospects for order
    placement in the automotive, pharmaceutical and medical markets over the
    medium term.
   
  * The resolution of the Rapiscan situation was an important step-change for
    the Company, clearing away a significant structural barrier to the
    development of sales in the aviation security sector. The renewed
    relationship has led to early additional sales revenue and improved cash
    flow, as well as strengthened 2D & 3D opportunities for growth with
    Rapiscan and greater flexibility in developing wider market partnerships.
   
  * We launched TPXi, our new security product targeted at explosives and
    ordnance detection, in November 2005 at the Milipol exhibition in Paris. In
    terms of 2D design technology, wireless configuration, ease of use and
    price, the TPXi clearly makes a valuable contribution to today's market for
    fully portable scanning detectors in the security, customs, and
    non-destructive testing applications markets. The market reaction at
    Milipol and since the launch has been extremely positive and we anticipate
    strong sales growth. The market size for this sector is estimated to reach
    $1.2 billion by 2009.
   
Outlook

We believe the significant achievements of 2005 will continue into 2006. The
year ended with a healthy order book of £326,000 which increased to £684,000 by
the end of October 2005.

Cash balances have increased since the year end and revenue is growing
steadily.

Other Matters

Finally, the commitment of all members of staff at Image Scan to meet the
Company needs over the last year has been extraordinarily positive and I would
like to take this opportunity to thank everyone for this response, and for
their persistence, ingenuity, and hard work.

P J Woods

Chairman

12 December 2005



GROUP PROFIT AND LOSS ACCOUNT

Year ended September 2005

                                  Note                                           
                                                           2005        2004
                                                                                 
                                                             £           £
                                                                                 
TURNOVER                                                  843,089     424,620    
                                                                                 
Cost of sales                                             (444,252)   (239,100)  
                                                                                 
Gross profit                                              398,837     185,520    
                                                                                 
Administrative expenses                                   (1,116,370) (1,448,125)
(including exceptional charge of £nil (2004:£161,995) )                          
                                                                                 
OPERATING LOSS                                            (717,533)   (1,262,605)
                                                                                 
Interest receivable                                       5,580       12,513     
                                                                                 
Interest payable                                          (10,446)    (4,877)    
                                                                                 
LOSS ON ORDINARY ACTIVITIES                               (722,399)   (1,254,969)
BEFORE TAXATION                                                                  
                                                                                 
Taxation                                                  30,289      44,486     
                                                                                 
RETAINED LOSS FOR THE                                     (692,110)   (1,210,483)
FINANCIAL YEAR                                                                   
                                                                                 
Retained reserves brought                                 (4,001,126) (2,790,643)
forward                                                                          
                                                                                 
Revenue reserves carried                                  (4,693,236) (4,001,126)
forward                                                                          
                                                                                 
                                                          Pence       Pence      
                                                                                 
Earnings per share                 (i)                                           
                                                                                 
Basic and diluted earnings                                      (2.7)       (6.3)
per share                                                                        
                                                                                 

NOTE:

(i) EARNINGS PER SHARE

                                                                                
                                                             2005       2004
                                                                                
                                                              £          £
                                                                                
Loss for the year                                          692,110    1,210,483 
                                                                                
Weighted average number of ordinary                        25,931,619 19,073,580
shares in issue                                                                 
                                                                                
                                                                Pence      Pence
                                                                                
Basic and diluted earnings per                                  (2.7)      (6.3)
share                                                                           
                                                                                

FRS14 requires presentation of diluted earnings per share (EPS) when a company
could be called upon to issue shares that would decrease net profit or increase
net loss per share. For a loss making company with outstanding share options,
net loss per share would only be increased by the exercise of out-of-the-money
options. Since it seems inappropriate to assume that option holders would act
irrationally and there are no other diluting future share issues, diluted EPS
equals basic EPS.



CONSOLIDATED BALANCE SHEET

As at 30 September 2005

                                  Note                                           
                                                            2005        2004
                                                                                 
                                                             £           £
                                                                                 
FIXED ASSETS                                                                     
                                                                                 
Tangible fixed assets                                     155,760     191,579    
                                                                                 
Intangible fixed assets                                   17,913      19,594     
                                                                                 
                                                          173,673     211,173    
                                                                                 
CURRENT ASSETS                                                                   
                                                                                 
Stock and work in progress                                94,645      44,449     
                                                                                 
Debtors                                                   341,175     146,189    
                                                                                 
Cash at bank and in hand                                  153,857     50,027     
                                                                                 
                                                          589,677     240,665    
                                                                                 
CREDITORS: amounts falling                                (427,356)   (343,722)  
due                                                                              
                                                                                 
within one year                                                                  
                                                                                 
NET CURRENT ASSETS/                                       162,321     (103,057)  
(LIABILITIES)                                                                    
                                                                                 
TOTAL ASSETS LESS CURRENT                                 335,994     108,116    
LIABILITIES                                                                      
                                                                                 
CREDITORS: amounts falling                                -           (17,307)   
due after more than one year                                                     
                                                                                 
Provisions for liabilities                                (20,500)    (15,700)   
and charges                                                                      
                                                                                 
                                                          315,494     75,109     
                                                                                 
CAPITAL AND RESERVES                                                             
                                                                                 
Called up share capital                                   348,681     193,356    
                                                                                 
Share premium account                                     4,660,049   3,882,879  
                                                                                 
Profit and loss account                                   (4,693,236) (4,001,126)
                                                                                 
EQUITY SHAREHOLDERS' FUNDS                                315,494     75,109     
                                                                                 


CONSOLIDATED CASH FLOW STATEMENT

Year ended 30 September 2005

                                   Note                                         
                                                            2005        2004
                                                                                
                                                              £           £
                                                                                
Net cash outflow from               (i)                    (738,032) (1,060,615)
operating activities                                                            
                                                                                
Returns on investments and servicing of                                         
finance                                                                         
                                                                                
Interest received                                          5,580     12,513     
                                                                                
Interest payable                                           (10,446)  (4,877)    
                                                                                
                                                           (4,866)   7,636      
                                                                                
Taxation                                                                        
                                                                                
Corporation tax recovered                                  20,564    54,431     
                                                                                
Capital expenditure and financial                                               
investment                                                                      
                                                                                
Purchase of tangible fixed                                 (70,764)  (90,421)   
assets                                                                          
                                                                                
Receipts from sales of                                     1,796     -          
tangible fixed assets                                                           
                                                                                
Purchase of intangible fixed                               -         (20,182)   
assets                                                                          
                                                                                
                                                           (68,968)  (110,603)  
                                                                                
Net cash outflow                                           (791,302) (1,109,151)
                                                                                
Financing                                                                       
                                                                                
Issue of ordinary share                                    932,495   986,885    
capital                                                                         
                                                                                
Bank loans repaid                                          (37,363)  (37,362)   
                                                                                
                                                           895,132   949,523    
                                                                                
Increase/(decrease) in cash in    (ii),                    103,830   (159,628)  
the year                          (iii)                                         
                                                                                

NOTES TO THE CASH FLOW STATEMENT

Year ended 30 September 2005

i) RECONCILIATION OF OPERATING CASH FLOWS

                                                                                
                                                            2005        2004
                                                                                
                                                              £           £
                                                                                
Operating loss                                             (717,533) (1,262,605)
                                                                                
Depreciation                                               104,787   121,101    
                                                                                
Amounts written off intangible fixed                       1,681     178,898    
assets                                                                          
                                                                                
(Increase)/decrease in stock                               (50,196)  (17,492)   
                                                                                
(Increase)/decrease in debtors (excluding corporation tax  (185,262) (12,686)   
recoverable)                                                                    
                                                                                
Increase/(decrease) in creditors                           108,491   (67,831)   
                                                                                
Net cash outflow from operating                            (738,032) (1,060,615)
activities                                                                      
  

NOTES TO THE CASH FLOW STATEMENT

Year ended 30 September 2005
                                                                              

ii) ANALYSIS OF NET FUNDS

                                         2004     2005       Other      2005
                                                                               
                                         £       Cash       non-cash     £
                                                 flow       changes          
                                                   £          £    
                                                                              
                                                                               
Cash at bank and in hand                50,027   103,830    -         153,857  
                                                                               
Debt due within one year                (37,363) 37,363     (17,307)  (17,307) 
                                                                               
Debt due after one year                 (17,307) -          17,307    -        
                                                                               
                                        (4,643)  141,193    -         136,550  
                                                                               

iii) RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS/(DEBT)

                                                                               
                                                             2005      2004
                                                                               
                                                              £         £
                                                                               
Increase/(decrease) in cash in the                          103,830   (159,628)
period                                                                         
                                                                               
Cash outflow from decrease in debt                          37,363    37,362   
                                                                               
Change in net funds/(debt) resulting                        141,193   (122,266)
from cash flows                                                                
                                                                               
Net (debt)/funds at 1 October                               (4,643)   117,623  
                                                                               
Net funds/(debt) at 30 September                            136,550   (4,643)  
                                                                               

NOTES TO THE ANNOUNCEMENT

Year ended 30 September 2005


 1. The financial information set out above does not constitute the Company's
    statutory accounts for the years ended 30 September 2005 and 30 September
    2004 but is derived from those accounts. Statutory accounts for 2004 have
    been delivered to the Registrar of Companies, and those for 2005 will be
    delivered following the Company's Annual General Meeting. The auditors have
    reported on those accounts; their reports were unqualified and did not
    contain statements under section 237(2) or (3) of the Companies Act 1985.
   
    The financial information has been prepared in accordance with the
    accounting policies adopted for the 2004 accounts.
   
 2. It is intended that the financial statements for the year ended 30
    September 2005 will be posted to shareholders in January 2006 and will also
    be available thereafter at the registered office, Pera Innovation Park,
    Nottingham Road, Melton Mowbray, Leicestershire, LE13 0PB.
   
 3. The Annual General Meeting will be held on 23 March 2006, at the offices of
    DMH Stallard, Centurion House, 37 Jewry Street, London, EC3N 2ER.