Trading and Legal Proceedings Update

Densitron Technologies plc

Trading and Legal Proceedings Update

Densitron Technologies plc announces that it expects its results for the year to 31 December 2012 to be behind market expectations. It does, however, expect that the operating profit for the year will be ahead of that achieved in 2011.

The primary cause of this is certain orders being received later than anticipated as a result of which the Directors now expect the deliveries associated with these orders, and therefore resultant sales, to be delayed into 2013. Orders booked in the first 9 months of the year, however, remain strong and are in excess of 10% higher than those booked in the same period in 2011. This trend is expected to continue for the remainder of the year.

In March 2012 the Directors announced that the Company had received notification of legal proceedings against it in respect of a lease of a property located at Wallsend, Tyne and Wear, near Newcastle. Full details of the action are set out in the announcement dated 1 March 2012. The claim is defended but in the interests of progressing the matter in an expedient manner, the directors have resolved to enter into mediation proceedings to seek a negotiated settlement if the other parties to the litigation are prepared to do so.

Grahame Falconer, Chief Executive of Densitron said: "We are disappointed that the Company will not sustain its recent growth in the current financial year. However, the current strength of our order book along with the development of intellectual property suggests that the outlook for the business is positive and we look forward to the coming year with confidence.

"In moving the Newcastle property claim into mediation, we hope to be able to draw a line under this issue and allow management to focus all its energies on developing the core business."