Trading Statement

To be embargoed until 7.00am

                                                           on 14 December, 2005

                            Surface Transforms Plc                             

                    ('Surface Transforms' or 'the Company')                    

           Trading Update, Directorate Change & Director's Interests           

Surface Transforms first six months trading for the 2005/6 financial year
closed on 30 November, 2005.Unaudited turnover for the six months was £68,302 (
2004: £208,442) and Cash on deposit was £ 2.1 million ( May 2005: £2.73
million)

Despite the reduction in turnover from the comparative period in 2004 which
included sales from a development contract with Dunlop Aerospace, turnover has
increased compared to the previous six months ended 31 May 2005 of £49,914.
Turnover in the first half comprised principally revenues from a development
contract with a US aircraft brake manufacturer, sales of rocket motor
components and a small amount of sales of high performance automotive brake
disc systems. The Company's order book is currently £44,500. The interim
results will be released during February 2006.

Automotive

a) General

The most recent on road tests were on 16 November and 12 December at the
Anglesey racetrack, where ceramic brakes on a number of cars were evaluated by
both test drivers and engineering teams. There were encouraging successes and
up to date news, including endorsements from certain car manufacturers which
can be accessed on www.systemst.com and www. surface-transforms.com. The grant
award announced last month assists and underscores the Company's drive to
deliver a highly cost effective brake, which can be used for both Track and
Road car requirements.

b) Aftermarket

Sales from the automotive after market had been expected to be higher by this
stage. However, the first sales channel established has not yet proved
successful. In order to provide greater control over the entry to this market,
the Company has taken two steps. The first has been development of the ability
to tune the whole braking system (ie brake disc, brake pad, wheel bell and
bobbin) for a targeted vehicle model so as to ensure satisfactory braking
performance in terms of both stopping distance performance and noise, vibration
and harshness. The second is to enter the UK aftermarket by targeting
particularly suitable models of Porsche and Ferrari initially, and then select
brake fitting companies specialising in those models to assemble and fit the
company's system - three such companies in the UK have already been contracted
with. Once this business model is established, the company intends to roll it
out by vehicle model and by country.

c) Vehicle Manufacturers

A number of EU car manufacturers of high performance cars (both high and low
volume) continue to evaluate System ST brake systems. Further to the Anglesey
track day referred to above, it is expected that low volume manufacturers of
specialist sports cars will be the first category of manufacturers to adopt the
system.

The Board

Peter Holland has indicated that due to his other executive business
commitments he wishes to resign as a non-executive director with immediate
effect. Peter is a successful businessman in the industrial chemical market and
since his appointment as a non-executive director in 2003, he has been
instrumental in guiding the reshaping of the Company. During 2005, he assumed
an interim executive role to ensure a smooth management transition, which led
to the appointment of Dr. Kevin Johnson as Managing Director. His wise counsel
will be missed but he will continue to be available to the Company for advice
on specific issues. The Company has started the process of looking for another
industry relevant non-executive director.

Peter Holland owns 170,515 shares in Surface Transforms and as part of his
departure has agreed to sell 31,000 shares to Julio Faria, resulting in the
latter's holding increasing to 2,357,845 shares in the Company, representing
16.8 per cent. of the issued share capital of the Company.

Outlook

Whilst introducing a new, high technology product is never straightforward,
particularly in terms of predicting timing of take up, the board continues to
view the future with confidence based on the steps which it is taking to
provide the Company with greater control over its entry into the automotive
aftermarket and also the greater control and understanding which the Company
now has over every stage of its production process, leading to lower
manufacturing costs and a stronger platform from which to conduct licensing
negotiations with OEMs.

For enquiries, please contact:

Surface Transforms plc John East & Partners Limited (NOMAD)

Dr. Kevin Johnson 0151 373130 Johnny Townsend, Simon Clements

Mr. Kevin D'Silva 07802 306956 0207 628 2200

Teather & Greenwood (Broker)

Mark Dickenson, Sindre Ottesen

0207 426 9000

Details of the Company's business and financial performance and its share price

can be found on

www.armshare.comwhich is accessed from the Armshare icon on

www.surface-transforms.com

A webcast of the 2005 results is also available on www.surface-transforms.com

/Investor and Media relations .