Trading Update

Amphion Innovations plc

Full Year Trading Update

·; Net Asset Value per Share down approximately 4.5% year-on-year in US dollar terms / 13% in sterling

·; Total revenue increased 22% to $8.6 million

·; IP licensing revenue increased 39% to $7.6 million

·; Gross profit increased 70% to $5.8 million.

·; Operating loss down from $3.38 million to $0.88 million

·; Operating profit of $10,000, excluding non-recurring items

·; $4.2 million raised through Convertible Promissory Notes for further investment in and support of each of the Amphion Partner Companies

2 February 2010 - Amphion Innovations plc (LSE: AMP) ("Amphion" or the "Company"), announces that results for the 12 month period to 31 December 2009 are expected to show a small decrease in Net Asset Value ("NAV") in sterling to £0.26 being $0.42 (£0.30 and $0.44 as at 31 December 2008), broadly in line with market expectations. In absolute terms, 26p per share equates to a total NAV of £34 million. This valuation includes the wholly-owned subsidiary, DataTern, which generated the majority of Amphion's revenues through IP licensing this year and which has yet to be revalued from historic levels.

Amphion builds shareholder value in high growth companies in the medical and technology sectors by using a focused, hands-on company building approach, based on decades of experience in both the US and UK. Currently there are 8 Partner Companies developing proven technologies targeting substantial commercial marketplaces in excess of $1 billion. Each Partner Company aims to achieve a target exit value in excess of $100 million. The Amphion model has been refined to optimise the commercialisation of patents and other intellectual property within the Partner Companies. The Partner Companies collectively own or control over 200 separately identified pieces of intellectual property, a number which grows rapidly each year.

During the year, Amphion successfully raised an additional $4,238,340 through the placing of additional tranches of the Convertible Promissory Note first issued in late 2008. The goal is to raise up to ₤7 million of additional capital through the issue of these notes and at year end ₤4.86 million had been issued. A further ₤713,122 has been issued since 1 January 2010 and we expect to be able to place the balance of the Note by the end of the financial year. The main use of proceeds from this issue has been further investment in and support of each of the Amphion Partner Companies.

Amphion's intellectual property licensing programme made good progress over the course of the year. Amphion's wholly-owned subsidiary, DataTern, Inc., signed additional non-exclusive intellectual property license agreements with 14 leading international companies over the year, bringing to 18 the total number of licensees of the ORM technology. Revenue generated from IP licensing rose 39% to $7.6 million in 2009. Despite the continued success of this programme, only about $1.3 million of value is shown in our balance sheet (and Net Assets) for our intellectual property assets.

As a result of the success of the licensing programme, Amphion's total revenue increased by 22% to $8.66 million in 2009 and gross profit increased by almost 70% from $3,411,694 to $5,791,018. The loss from operations narrowed from $3,381,098 to $876,264 and excluding non-recurring items, the Company managed to record a profit, of a little over $10,000.

Despite the difficulties in the market environment during 2009, Amphion's Partner Companies continued to make progress and several important milestones were reached. Kromek's liquid detection systems offer complementary threat detection technologies to the full body scanning systems and conventional x-ray machines currently used in airports around the world that are aimed at detecting explosive materials, while also easing the restrictions on passengers passing through security checkpoints. Trials of Kromek's systems by leading government agencies in both the US and the UK are making steady progress and other markets are being actively explored for Kromek's revolutionary and proprietary digital x-ray technology. Kromek won the Global Security Challenge SME 2009 award in November 2009. Axcess successfully implemented its comprehensive security system at the Port of Spain in Trinidad and Tobago where the Fifth Summit of the Americas conference was held in April 2009. Axcess also recently announced it entered into an important partnership with HID Global, the leading supplier of access control systems in the world. Myconostica continues to make progress with the development and launch of its rapid diagnostic products for life threatening fungal infections. In June 2009, WellGen launched its first consumer products, a line of nutritional supplements under the brand name, TeAmé and in December the company announced important pre-clinical progress in the development of its leading product which is being developed for the large unmet medical need in the use of medical foods for the management of diabetes.

Amphion has continued to develop its activities in the Middle East and a number of projects are currently under evaluation. In November, Amphion signed a partnership agreement with Kuwait University, the State's first and oldest University. This agreement is aimed at establishing and operating a Technology Transfer Unit ("TTU") at the University, which will be the first in-house TTU in Kuwait.

Amphion expects to announce its preliminary results for the 12 months to 31 December 2009, on 16 March 2010.

Richard Morgan, Amphion's Chief Executive Officer, said:

"2009 was a challenging year for businesses worldwide and Amphion found itself in a very tough environment. Our model depends in part on being able to gain access to capital to fund and grow our Partner Companies. With the public markets effectively closed for most of the year and the private capital markets also frozen, the challenges were great. In addition to the cautious stance and cost cutting measures Amphion and our Partner Companies have adopted since 2008, the continued success of our IP licensing programme has been a critical factor in getting the Company close to break-even for the year and to enable us to raise additional capital through the issue of the Convertible Promissory Note. These have been key factors in allowing Amphion to help our Partner Companies to keep moving forward. The outlook for continued progress in our IP licensing activity remains positive and we are committed to growing and strengthening this side of our business. We continue to believe that a number of our companies should be ready to approach the IPO market as and when it revives."

For further information please contact:

Amphion Innovations

Charlie Morgan:

+1 (212) 210-6224

Cardew Group

Tim Robertson/ Jamie Milton/Daniela Cormano:

+44 020 7930 0777

Charles Stanley Securities, Nominated Adviser

Mark Taylor/ Freddy Crossley:

+44 020 7149 6000

About Amphion Innovations plc


Amphion (LSE: AMP) builds shareholder value in high growth companies in the medical and technology sectors, by using a focused, hands-on company building approach, based on decades of experience in both the US and UK. Amphion has significant shareholding in 8 Partner Companies developing proven technologies targeting substantial commercial marketplaces, each in excess of $1 billion. Each Partner Company is chosen with the goal of achieving an exit valuation in excess of $100 million. The Amphion model has been refined to optimise the commercialisation of patents and other intellectual property within the Partner Companies. The Partner Companies collectively own or control over 200 separately identified pieces of intellectual property, a number which grows rapidly each year.

On the web: www.amphionplc.com