Period end trading update

Xaar PLC
18 June 2004


FOR IMMEDIATE RELEASE                                             18 June 2004


                                    Xaar plc

                  POSITIVE HALF YEAR PERIOD END TRADING UPDATE

Xaar plc ('Xaar'), the inkjet printing technology group headquartered in
Cambridge, presents an update on performance towards the end of the half year to
30 June 2004.

Xaar is pleased to announce that trading in the second quarter of the year has
remained strong and that results for the first half of the year will be ahead of
expectations.

Sales for the first half are expected to be in excess of £16.0m (2003: £13.6m)
and demand continues to be healthy into the third quarter.

Further improvement in production yields and margins in the first half, coupled
with tight cost control, is expected to result in a profit before tax (and
before foreign exchange movements on inter-company loans) in excess of £2.0m
(2003: loss of £3.3m on a comparable basis). Cash at the half-year will be in
excess of £9.0m (£8.5m at 31 December 2003 and £5.9m at 30 June 2003).

The outlook for the full year continues to be positive.

                                      Ends


Contacts

Xaar plc:                                                         01223-423663
Ian Dinwoodie, Chief Executive                                  www.xaar.co.uk
Nigel Berry, Group Finance Director & Deputy Chief Executive

Bankside Consultants:
Steve Liebmann                                    020-7444-4163 / 07802-888159








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