Positive half year update

Xaar PLC
06 July 2005


FOR IMMEDIATE RELEASE                                              6 July 2005

                                    Xaar plc

                       POSITIVE HALF YEAR TRADING UPDATE

Xaar plc ('Xaar'), the inkjet printing technology group headquartered in
Cambridge, presents an update on performance for the six months ended 30 June
2005.

Results

Xaar is pleased to report that revenues for the six months to 30 June 2005 are
in line with expectations at close to £20.0m (2004: £16.9m).

Profit before tax for the period (and before foreign exchange movements on
inter-company loans) is ahead of expectations at around £4.5m (2004: £2.4m on a
comparable basis).  These figures are stated under UK GAAP to be consistent with
current market forecasts.

The results reflect a continuing growth in demand for the group's products and
the benefit of increased volumes on manufacturing overhead recovery.

Cash at the end of June was in the region of £17.5m, up from £15.4m at the start
of the year.  This movement includes an increase in working capital and payment
of the final dividend for 2004 of £0.6m.

The outlook for the full year continues to be positive.

OmniDot Launch

The group's OmniDot printhead platform, its new range of products co-developed
with Agfa (and named 'UPH' in its Agfa format), started commercial production in
the second quarter and was officially launched by Agfa at the FESPA tradeshow
held in May in Munich, Germany.

FESPA represents the Screen Printing sector of the industry and digital printing
accounted for more than 50% of the stands at the show, with Xaar well
represented by its OEMs.  Further details of Agfa's revolutionary new digital
inkjet press, the M-Press, and the Anapurna 100 wide format printer can be found
on the Agfa website, www.agfa.com.

Announcement of interim results

The interim results will be announced in accordance with Xaar's normal timetable
in mid-September.

The interim results will be prepared under IFRS in accordance with the EU
directive for quoted companies applicable for reporting periods starting on or
after 1 January 2005.  The main differences between the two sets of reporting
standards, as they apply to the group, are likely to be in the capitalisation of
certain research and development costs, the expensing of share option costs and
movements in the valuation of the group's US dollar hedging transactions.

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                                      020-7367-8883 / 07802-888159


                      This information is provided by RNS
            The company news service from the London Stock Exchange