Trading Statement

Image Scan Holdings PLC 14 November 2006 14 NOVEMBER 2006 IMAGE SCAN HOLDINGS PLC ('Image Scan' or 'the Company') PRE-CLOSE TRADING UPDATE Strong trading and rapidly growing order book The Board of Image Scan, a world leader in the field of real-time 3D and 2D x-ray imaging for the 'Homeland Security' and 'Industrial Inspection' markets, is pleased to provide shareholders today with a pre-close Trading Update, highlighting continued strong trading at the Company on the back of its growing order book and client portfolio. It is also pleased to announce that it has received a welcome endorsement from the US Transport Security Administration ('TSA'). KEY POINTS •2006 turnover anticipated to have increased by 70%; •Significant reduction in losses expected; •Order book increased five fold since year start; •Endorsement of 3D technology from US Government's TSA; •TSA contract extension worth over $100,000 secured; and •Board confidence growing of move into profitability in 2007. TRADING & CORPORATE UPDATE The Board anticipates that turnover, for the year ended 30 September 2006, will exceed £1.4 million (2005: £843,000), an increase of approximately 70%. The corresponding loss before interest and amortisation is also anticipated to be significantly reduced. ORDER BOOK UP 600% The order book at the end of September 2006 stood at £1.7m, a five fold increase over the corresponding close in 2005. To fund the inevitable increase in cash flow requirements attributable to this increased order book the Company has negotiated deferment of the existing £200,000 loan to a new date of 31st March 2008 and an additional long-term loan for a further £200,000. Both loans have warrants attached at 20p. Our long term strategic funding plans are now clear as we move into profitability. This considerable uplift in the order book stems from a series of new contract successes including an order for Image Scan's innovative MDXi system - supplied to a blue-chip international corporation for their plants in the UK and South Africa - and a major £1m contract with British Nuclear Group Ltd ('BNG') for in-line x-ray inspection systems; the latter due for completion by May 2008. Sales of TPXi, the transportable, light-weight, security inspection device, continue to grow with orders for a further 14 units being received in the last three months. The Company is now confident that the distributors of the TPXi systems will comfortably exceed their minimum sales targets. The Directors believe that the on-going sales and significant improvement in the order book will provide a sound platform for achieving profitability in 2007. ENDORSEMENT: TRANSPORT SECURITY ADMINISTRATION 3DX-Ray Limited, pioneers of 3D x-ray imaging technology in both baggage-checking security and industrial applications and a wholly owned subsidiary of Image Scan, has received a welcome endorsement from the US Government's security equipment regulator, the TSA. The TSA are the purchasing authority for the USA transport sector. The imminent release of a report on 3D x-ray imaging technologies by the TSA, concludes that 3DX-Ray Limited's real-time 3D images provide significant improvements in overall security when compared to conventional 2D x-ray baggage inspection systems. Detailed analysis of the results by the TSA demonstrated that the probability of threat detection rates improved by over 10% when the bags were viewed with 3DX-Ray's 3D system. EXTENSION TO EXISTING CONTRACTS Further to the TSA endorsement, Image Scan is pleased to report that it has secured an extension to an existing award with the Department of Homeland Security ('DHS') and TSA for research and development into advanced 3D x-ray systems for baggage inspection. The contract extension is valued at $100,000 over the next 12 months. In this latest project the TSA will work actively with Image Scan in the development of an advanced autostereoscopic 3D display that does not require the operator to wear any special equipment, such as polarizing glasses, to view the 3D image. The new system will also be evaluated by the TSA and DHS to benchmark it against conventional systems. Nicholas Fox, CEO of Image Scan Holdings plc, commented: 'We run a business providing solutions, not just technology, to our customers. As the Company heads into its closed period, the Board is delighted to provide news of the robust current position of Image Scan and looks forward to reporting its Preliminary Results in January.' ---ends--- For further information, please contact: Image Scan Holdings plc Tel: +44 (0) 1664 503 600 Nicholas Fox, CEO info@ish.co.uk Bishopsgate Communications Ltd Tel: +44 (0) 207 430 1600 Dominic Barretto Jenni Herbert dominic@bishopsgatecommunications.com KBC Peel Hunt Tel: +44 (0) 121 698 8505 Nick Maslen nick.maslen@kbcpeelhunt.com About Image Scan Holdings plc Image Scan Holdings plc (AIM: IGE) is focused on the development and commercialisation of market leading real-time 3D and 2D x-ray solutions for use in the global industrial and security inspection markets. The company's industrial inspection solutions include the MDXi unit and the X-Line systems. The security portfolio includes a unique 3D baggage inspection system for corporate and airport security and TPXi, a portable bomb and suspect package detection system. Current Technology Portfolio The Company's portfolio currently comprises of the following x-ray inspection systems: Axis-3d(R); X-Line; MDXi-400TM; TPXi-675TM; and the DEXTM x-ray vision engine for oem applications. For further information on the Company, please visit: www.ish.co.uk - and for further information on its products, please visit: www.3dx-ray.com. This information is provided by RNS The company news service from the London Stock Exchange
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