Trading Update

28 January 2011

Artilium plc ('Artilium' or the 'Company')

 Trading Update

Artilium (AIM :ARTA) is pleased to announce the following Trading update for the six months to 31 December 2010. Operations during the period have delivered according to management expectations, and consequently the board expects Artilium to achieve break even at the EBITDA level for the first time towards the close of the fiscal year ending 30 June 2011.

Our pipeline remains healthy with a large number of new companies testing and piloting our solutions and we believe that the first half of 2011 will see the conversion of these tests and pilots into new projects. Various large telecoms companies have successfully tested Artilium's location based solution, which is expected to result in commercial contracts during the first half of 2011.

There has been renewed interest from established telecom operators in Artilium's technologies. Our sales and marketing focus has been on resellers bringing revenues and additional business to the operators over the last year. Operators are particularly interested in the ability of our technologies to position them in the value chain thus avoiding becoming merely a provider of (mobile) bandwith. These services, which large internet players cannot provide, include handset ubiquitous location based services, fixed mobile convergent services and cost effective connectivity routing. In addition, packaging of all these products into customer offerings enables the operators to use their unique billing relationship as another distinguishing selling point.

Recently, we have seen an increase in economic activity as operators are again focused on these new technological developments. The Board believes this will have a positive impact on Artilium's business in the short term. We look forward to reporting our Half Year Results at the end of March 2011.

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Artilium - Notes to Editors

Founded in 1995, Artilium develops and sells software solutions to telecoms companies and service providers under its ARTA family of products. Its clients include BT, Vodafone Spain, Ziggo (NL), Belgacom Mobile (BE) Telenet and KPN.

ARTA enables telecoms companies to market to consumers in a highly targeted manner, creating packages which are tailor made to the precise requirements of small groups of subscribers such as a municipality or interest group.

The ability to offer a commercially viable solution for customers to sell their services to small groups (e.g. supporters of a football team), is possible using other technologies but substantially more expensive.

ARTA technology provides:

- A low cost solution for creating a commercial communications network for communities and companies. Used by major Mobile Virtual Network Operators and smaller Operators targeting subscriber bases of less than 1.000

- A low cost, low energy use mobile phone based alternative to GPS for movement tracking for customers ranging from haulage firms through to families wishing to know where their children are.

- A real time, low cost rerouting of calls to provide the cheapest solution to Mobile Network Operator's and Mobile Virtual Network Operators