Xaar Regulatory News (XAR)

15 December 2016

Xaar plc

Scheduled Trading Statement

Xaar plc ("Xaar", "the Group" or "the Company"), the digital inkjet printing technology Group headquartered in Cambridge, UK, announces an update on trading for the period beginning 1 July 2016. 

The Board now expects total revenue in the second half of 2016 to be similar to the £44.5 million recorded in the first six months of the year, before taking account of revenue delivered by the acquired EPS business which contributed to the Group from 1 July 2016. The Board's expectation for overall full year earnings remains unchanged.

In ceramic tile printing ("Ceramics"), initial demand for Xaar's new 2001 and 2001+ printheads is strong following the launch of those products in September. Longer than expected customer printer re-designs and manufacturing ramp up, combined with the competitive pressures we have previously highlighted in this sector, are expected to result in lower Ceramics sales in the second half of 2016 than previously anticipated. The products launched this year position the Company well in terms of maintaining Xaar's market leading position and supporting our OEM partners in 2017 and beyond.

In Packaging and Product Printing, sales are ahead of expectations. All packaging sub-sectors, including labels, coding & marking and direct to shape, are delivering organic growth ahead of both H1 2016 and H2 2015 sales. Engineered Printing Solutions ("EPS"), the US product printing equipment company acquired on 1 July 2016, is performing to plan and a smooth integration into the Xaar Group has been achieved.

Initial demand is high from our partner OEMs for the new Thin Film printheads launched this year, the 5601 and the 1201. Both products are on track to provide significant revenue contributions in 2017.

Revenue from Xaar's licensing business has again been strong in the second half of 2016, through a combination of favourable exchange rates, higher licensee royalties and a significant royalty audit resolution. Royalty related revenue in the second half of 2016 is therefore expected to be similar to the total recorded in the first six months of the year.

The Company expects to announce its 2016 full year results on 22 March 2017.

This announcement has been determined to contain inside information.

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