Xaar Regulatory News (XAR)

Xaar plc

PACKAGING PROGRESS UPDATE

Xaar plc ("Xaar", "the Group" or "the Company"), the inkjet printing technology Group headquartered in Cambridge, is pleased to issue an update on recent progress made in developing new opportunities in the packaging sector.

Xaar's market leading technology is at the heart of multiple innovative digital inkjet packaging solutions which were launched or demonstrated by Xaar's OEM partners at major exhibitions during September 2013.

· At Print 13 (8-12th September, Chicago) FFEI Ltd, a leading developer, manufacturer and supplier of digital imaging solutions, launched its new-generation Graphium digital UV inkjet printer. The product will be distributed by Fujifilm in both the USA and Europe. Xaar 1001 printheads were specified by FFEI to deliver the high productivity, reliability and quality that customers require for label, packaging and speciality print applications.

· At DRINKTEC (16-20th September 2013, Munich) four of Xaar's partner OEMs publicly demonstrated for the first time innovative "direct-to-shape" digital printing solutions. The four OEMs demonstrated systems which enable full colour images and text to be digitally printed directly onto glass, PET and metal containers, creating significant efficiencies through reductions in materials and inventory, improving time to market and eliminating many of the costs associated with using labels or sleeves. In addition, this technology allows digital decoration of irregular-shaped and textured containers which can pose a challenge for traditional labels and sleeves. It is expected that these offerings will now undergo a number of field trials which, if successful, will lead to the commercialisation of the technology.

· At Labelexpo Europe (24-27th September 2013, Brussels), Xaar's partner OEMs including ALS Engineering, Durst, EFI Jetrion, FFEI/Fujifilm, INX International, JF Machines and Stork Prints, all demonstrated their latest Xaar 1001-enabled labelling solutions which range from stand-alone entry-level systems for late-stage overprinting, to fully integrated systems for in-line graphics digital printing and finishing.

For further detail on these and other developments please go to www.xaar.com/news.aspx to access Xaar's latest news releases.

Ian Dinwoodie, Xaar's Chief Executive, commented:

"It is pleasing to see the progress being made in this significant market. Digital print of full colour graphic labels is clearly gaining traction in the packaging industry as evidenced by the strength of our OEMs' product line-up recently exhibited. The first public 'direct-to-shape' demonstrations clearly created an industry buzz, and we look forward to our partners moving through their field trials and into commercialisation. Whilst this recent activity is not expected to have any material impact on Xaar's 2013 financial results, the positive feedback received reinforces the potential for Xaar's technology to create transformational and disruptive solutions across multiple discrete markets".

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