Trading Update

Character Group PLC
17 January 2007


Issued by Citigate Dewe Rogerson Limited, Birmingham
Date: Wednesday, 17 January 2007
                                                               Embargoed: 7.00am

                            The Character Group plc
                                 ('the Group')
                                 Trading Update

At the Group's Annual General Meeting, which is being held today (17 January
2007) Richard King, Chairman will make the following statement to shareholders:

'In the Group's Preliminary announcement for the year ended 31 August 2006
issued in November 2006, I commented that the Directors were confident that 2007
would be another good year for the Group.

'I am therefore pleased to report that, for the first four months to 31 December
2006 of the current financial year, sales from continuing operations were 35%
ahead of the comparative period in 2005.

'This growth to date in sales and profits reflects an outstanding performance
for the Group, especially as we continue to operate in a difficult period for
retailers both in the UK and across Europe.

'Our Doctor Who product line-up performed exceptionally well and it is
satisfying to note that we experienced strong double digit growth in many of our
brands.

'Since the disposal of our digital business in February 2006, we have been able
to focus virtually all our efforts on the toys and games portfolio. This,
together with our strategy of designing and developing products in-house, has
proven to be a major factor in the Group's growth since its restructure. This
also bodes very well for the future and the Directors believe that the Group
will continue to further improve its revenues, productivity and efficiencies as
it builds on its market position. This is especially important in the current
trading environment where our customers are having very mixed trading results
and where we need to continue to improve our internal operations in order to be
able to preserve the basis for profitable growth.

'I am also pleased to report that we have now presented our 2007 Christmas
product range to our major trading partners. Without exception, we have received
a strong overall response, which should lead to further growth throughout this
2007 calendar year.

'As our market share continues to grow, we have established ourselves as a major
supplier in the UK and we believe we are well positioned to capitalise further
on that position, whilst continuing to develop our international sales.

'Given our sales to Christmas 2006, coupled with the positive reaction to our
current product portfolio and the planned new introductions to our line-up which
will be unveiled at the UK Toy Show being held at Excel in London next week, the
Directors continue to be confident that the Group remains on target to maintain
its growth throughout 2007.'

Enquiries:
Richard King, Chairman                           Fiona Tooley, Director                Richard Thompson
Kiran Shah, Group Finance Director & Joint MD    Katie Dale, Senior Account Manager    Philip Davies
The Character Group plc                          Citigate Dewe Rogerson                Charles Stanley Securities
Today: [phone]                      Mobile: [phone]           Tel: [phone]
Tel: [phone]                        Today: [phone]
Mobile: [phone] (RK)                 Tel: [phone]
Mobile: [phone] (KS)
www.thecharacter.com


Annual General Meeting being held at 11.00am at the offices of Citigate Dewe
Rogerson, 3 London Wall Buildings, London Wall, EC2M 5SY.




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