Trading Statement - Toy Market Demand Down

ZOTEFOAMS PLC
29 October 1999


                               Trading Statement
                                       
In its interim statement on 2 August 1999 the Company cautioned that, with UK
demand relatively flat and sales to the European toy segment reducing
progressively, it expected the second half of the year to remain challenging.

In the second half to date we have experienced improving trading conditions in
most of our major geographical markets, in particular Europe and North
America. However, the benefits of this have not been enough to offset the dual
impact of rising raw materials prices and a major reduction in demand from the
toy market.

The price of our major raw material, polyethylene, has risen substantially in
the second half and we anticipate that this, combined with adverse currency
effects, will impact the Company's pre-tax profits for the full year by
approximately £0.5 million.

Further, contrary to normal seasonal trading patterns we have also recently
experienced a severe reduction in demand from the toy market.  In particular,
our major customer has indicated a fundamental redesign and re-launch of its
product line and therefore we do not anticipate receiving any further orders
this year.

As a consequence, the Board now expects profit before tax for the year to 31
December 1999 to be approximately £1.7m short of our expectations at the time
of the interim announcement. While it is too early to give an accurate
assessment, we also expect this situation to have an adverse impact on current
market forecasts for the following year.

We have made much progress over the last 12 months with an important element
in our strategy, namely improving our sales mix by application and reducing
our exposure to the toy market. However, in the light of today's announcement
the Board is reviewing both the scope and timing of its current capital
expenditure plans.

Enquiries:

Zotefoams plc       0181 664 1600
Andrew Gingell      Managing Director
David Stirling      Finance Director

Financial Dynamics  0171 831 3113
Tom Baldock