Acquisition & Trading Update

Carclo plc
01 October 2007



For Immediate Release                                             1 October 2007

                                   Carclo plc

   Acquisition of remaining minority interest in Conductive Inkjet Technology
                      Limited and pre-close trading update

The board of directors of Carclo plc ( the 'Board' and 'Carclo' respectively) is
pleased to announce that it has entered into an agreement to increase its equity
investment in Conductive Inkjet Technology Limited ('CIT') from 74.4% to 100%.

In our Interim Management Statement of 15 August 2007 we reported continued
progress at CIT across a broad range of applications including sensor and Radio
Frequency Identification ('RFID') applications, photovoltaics and displays. CIT
has highly attractive growth prospects in a number of established and emerging
sectors.

To ensure that these growth opportunities are developed effectively and that the
full benefit of this growth accrues to Carclo's shareholders, the Board has
decided to acquire the remaining minority interest in CIT.

Conductive Inkjet Technology

CIT is a unique patented process to print pure metals onto plastics. The initial
invention was made by Xennia Technology Ltd ('Xennia') whilst undertaking an
application development for mobile handsets on a contract funded by Carclo. It
was recognised that the invention had applications well beyond mobile telephony
and therefore Carclo and Xennia formed a 50:50 joint venture to safeguard,
develop and exploit the invention. In 2005, the partners agreed that Carclo
should take the lead in commercialising CIT and Carclo acquired a further 20%
holding from Xennia at a cost of £1.6 million and thereby gained effective
management control of CIT. In the past year, CIT has been funded through further
issues of shares in which Xennia has not participated with the result that
Carclo's stake in CIT has increased to 74.4%. Since 2005, CIT has been
established as a dedicated advanced materials company adjacent to the Science
Park in Cambridge. CIT is now fully independent of Xennia and employs 11 people
- primarily highly qualified chemists and engineers.

CIT based products have commenced production within Carclo and evaluation
systems based on the MetalJet range have been sold to a number of advanced
technology companies. The CIT process has been extended to printing on silicon
and glass substrates, and to using laser technology to produce extremely fine
lines which are invisible to the eye. Further information on CIT application
areas is included in Appendix 1.

Acquisition

Carclo has reached agreement with Xennia to acquire its 25.6% holding in CIT
which will become a 100% owned subsidiary of Carclo. The total consideration
payable to Xennia in connection with the acquisition will be a maximum of £2.07
million. This implies an enterprise value for CIT of £11.47 million based on net
debt of £3.40 million as at 31 March 2007. The Board believes that this
represents excellent value given the rapidly expanding universe of applications
for the CIT.

Carclo is paying Xennia an initial consideration of £1.07 million (the 'Initial
Consideration') for Xennia's 25.6% stake in CIT of which £0.97 million is in the
form of 869,565 new Carclo shares at Friday's closing share price of 111 pence
per share, and £0.10 million will be in cash. As part of the agreement, the sale
of the consideration shares is subject to lock-up arrangements for one year such
that any sale requires the written consent of Carclo. Carclo has also agreed
that CIT will separately pay Xennia £0.15 million for the release of certain of
its intellectual property rights relating to CIT, and £0.10 million for
transitional support.

In addition, Carclo has agreed to pay Xennia a deferred consideration for
Xennia's 25.6% stake in CIT of up to £0.75 million, in cash, payable in June
2010 (the 'Deferred Consideration'). The first element of the Deferred
Consideration is based upon 50% of the earnings before interest, tax,
depreciation and amortisation ('EBITDA') generated by CIT in the financial year
ending 31 March 2010 capped at £0.50 million. The second element is based upon
sales of MetalJet 2000, 4000 and 5000 production platforms up to 31 March 2010
and is capped at £0.25 million. Each MetalJet production platform is expected to
generate significant recurring revenues for CIT's patented inks.

Pre-close trading update

The board is pleased to report that the group has continued to trade in line
with its expectations since the issue of our Interim Management Statement on 15
August 2007. In Technical Plastics we have seen good sales growth over the same
period last year despite the impact of the weaker US dollar on the
re-translation of sales from our businesses based in the USA and China. Margin
progression in our European businesses has been temporarily impacted by the
costs of integration of a number of new programmes and the rationalisation
programme at our Slough facility. We expect a significantly stronger second half
performance from this division. The Precision Products division has traded
strongly throughout the first half of our financial year on the back of good
demand for higher margin multiband antenna and its first half performance is
expected to be well ahead of the prior period.

Appendix 1

CIT applications

Sensors and RFID

The development of the CIT process for high speed printing on PET polyester film
is now complete and commercial production has commenced. The newly launched
MetalJet 6000 and MetalJet 5000 platforms enable the CIT process to be used for
the production of thin metal inkjet printed circuitry on sheet or reel format
which is appropriate for uses ranging from RFID antennas to sensors, keypads,
switches and other printed circuits. The first production line of the MetalJet
6000, a high speed reel to reel inkjet printing line developed with our American
partner, Preco Inc, is currently being installed in the USA. This contract
manufacturing facility is aimed at supplying a wide range of RFID antennas and
flexible circuitry to prospective purchasers of the entire system. The facility,
which should generate significant future ink revenues, is expected to be
operational in January 2008. We currently have a high level of interest in our
technology from a number of leading players in the RFID industry, and are
targeting a further three sales of MetalJet 6000 systems by March 2009.

Photovoltaics

Global production of solar cells is growing significantly with industry revenues
forecast to rise rapidly over the next five years. The majority of the new solar
installations are now taking place within Europe which accounts for nearly one
third of the world's solar cell manufacturing. The industry is interested in
applying non-contact printing processes such as ink-jet to allow thinner silicon
wafers to be safely handled without breakages. CIT is collaborating with three
of the major European solar cell producers in the development of a range of
inkjet materials to be used in the solar cell manufacturing process.

In the first process developed by CIT, a catalytic inkjet fluid is printed onto
the anti-reflective surface of a solar cell to produce a pure silver
interconnect. The wafer is then fired under special conditions to produce an
ohmic contact between the silver interconnect and the photovoltaic junction.
This technology potentially increases the efficiency of the solar cell by
allowing narrower line widths and more conductive materials to be used. A second
process, also developed by CIT, uses a CIT ink to etch away selectively the
anti-reflection coating on the surface of the solar cell allowing the
interconnect to be made directly onto the silicon. This process has the
capability to produce more efficient cells than current production methods
allow.

CIT has engaged ISC Konstanz, an international solar energy research facility,
to support these developments.

Displays

CIT has a patented technology to write extremely fine lines using lasers - line
widths of five microns have been demonstrated which are invisible to the human
eye. This ink technology can also be used with the existing mask aligner
equipment used to produce flat panel displays.

Solid state displays generally require a transparent electrode on the top of
each pixel. This electrode is usually made of Indium Tin Oxide ( 'ITO' ) which
is transparent but has limited conductivity. CIT's fine line technology can be
used to provide a conductivity boost to the ITO electrode. In some display
applications the CIT technology can actually replace the ITO electrode. The CIT
technology therefore potentially allows displays to operate much more
efficiently, significantly extending the range of passive matrix addressed
displays and enabling the application of new display materials such as Organic
Led Emitting Diodes ('OLED').

CIT is nearing completion of a DTI funded development programme with Cambridge
Display Technology Limited ('CDT') using its fine line technology to produce
feature sizes down to approximately five microns in the production of a full
size back plane demonstrator based on CDT's P-OLED colour display design.

Together with a partner company, CIT is currently seeking DTI support to
commence a further eighteen month development programme to develop a prototype
production process for the manufacture of OLED displays using CIT's conductive
tracks for direct pixel connection. An objective of this programme is to utilise
our technology in a prototype facility using existing flat panel display
production equipment. Commercialisation could therefore materialise quite
rapidly following a successful conclusion of the development.

CIT has joined a second DTI funded programme headed by Epigem Limited to produce
an alternative lower cost material to ITO. This two year programme, which is
expected to start on 1 October 2007, is aimed at producing a viable ITO
alternative by October 2009.

CIT's fine line technology has the potential to radically change the way that
flat panel displays are designed and manufactured and therefore could generate
substantial commercial revenues.

                                     - Ends-

Enquiries:

Carclo plc                                                          01924 268040
Ian Williamson, Chief Executive

Weber Shandwick Financial                                          020 7067 0700
Richard Hews/James White

Notes to Editors

About Carclo (LSE: CAR)

• Carclo plc is a global supplier of technical plastic components. It is a 
  public company whose shares are quoted on the London Stock Exchange.

• 75% of sales are derived from the supply of fine tolerance, injection moulded 
  plastic components, which are used in medical, automotive, telecom and 
  electronics products. This business, Carclo Technical Plastics, operates 
  internationally in a fast growing and dynamic market underpinned by rapid 
  technological development.

• 25% of sales are derived from the supply of manufactured systems to the 
  automotive and aerospace industries.

• Carclo's strategy is to grow rapidly in low cost manufacturing regions and to 
  develop new technologies and products to underpin future growth.




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