Trading Update

Spectra Systems Corporation

("Spectra" or the "Company")

Trading Update

Spectra Systems Corporation, a leader in machine-readable high speed banknote authentication and brand protection technologies, today announces that it expects its profits for the year ended 31 December 2016 to significantly exceed market expectations. Revenue is also expected to be ahead of market expectations.

Spectra anticipates releasing its preliminary results for the year ended 31 December 2016 in March 2017.

This announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.

Dr. Nabil Lawandy, Chief Executive Officer, stated: "The confluence of significantly improved margins from our in-house manufacturing (on an order delivered in late December), along with a new ongoing phosphour sales channel, have resulted in a very good year for the Company. Based on contracted revenue, a full year of in-house manufacturing and early orders for phosphours, we expect this momentum to continue into 2017."

Enquiries:

Spectra Systems Corporation

Dr. Nabil Lawandy, Chief Executive Officer Tel: +1 (0) 401 274 4700

WH Ireland Limited

Chris Fielding, Head of Corporate Finance Tel: +44 (0) 20 7220 1650