Trading Update

Oxford Advanced Surfaces Group plc

("OAS" or the "Company")

Trading Update

2 December 2010

Commercial and technical advances with OntoTM and VISARCTM products

Oxford Advanced Surfaces Group plc (OAS), the advanced materials company, provides an update on the commercial progress to license of their leading products.

Commercial Progress in 2010

OAS has made excellent progress in the year to date achieving independent technical validation of its key products; OntoTM Surface Modification to aid control in printing electronics, OntoTM Speciality Adhesives to provide a flexible OTFT for electronics and VISARCTM Anti-Reflective Coatings for Eyewear. Management believe that, although first commercial deals are now unlikely to be completed before the end of 2010, OAS now is in a strong position to negotiate and secure commercial contracts. 

Products are now qualified with leading partners and test centres; passing demanding industry qualifications. In addition to recent news, the OAS VISARCTM Anti-Reflective Coating has passed industry standard durability tests for market qualification. In one key test it does not scratch when steel wire is dragged across a treated lens.

Market

OAS believes that its Product range is ideally positioned by addressing key unmet needs in the fastest growing markets.

According to a recent article by Walter Price, Fund Manager at RCM Technology Trust, display technology, rechargeable batteries and solar power will be three of the top ten technology trends that will catalyse growth for the next decade. Eyewear is also forecast to grow strongly driven by the increasing average age in world population and increased affluence.

Independent market data values the Solar market at $39B, the global Eyewear market at $70B and the Displays market at $100M.

Solar, Displays, Memory and Logic are all markets seeking to adopt Printed manufacture. IDETECHEX forecasts that the market for printed electronics to be worth $15B by 2015, with strong growth to $25B by 2017. Printed electronics offers faster manufacturing, reduced processing complexity and enables the manufacture of next generation flexible plastic devices.

Recent independent market research values the Anti-Reflective Coating (ARC) market at $1.5B in material costs. Double digit growth is forecast for current ARC technology into Solar and Eyewear. Strong growth is also predicted into Flat Panel displays. The key unmet industry demand is for a continuous manufacturing friendly ARC. VISARCTM addresses this need and OAS believes that this offers a huge potential to grow the ARC market considerably beyond these forecasts. 

Product Development

OntoTM Advanced Adhesives for the Electronics Markets

·; OntoTM Speciality Adhesive validated to provide a much needed solution to the persistent interlayer delamination problems facing device manufacturers in flexible plastic electronics.

·; OntoTM Surface Modification technology validated to improve printing processes for electronic device manufacture; improving accuracy and control in device layers.

·; OAS has sampled and is in discussion with leading electronic and chemical firms. A further period of development is expected leading toward license deals.

VISARCTM Anti-Reflective Coatings for Eyewear

·; VISARCTM has been validated independently to pass the demanding industry standard tests for both optics and durability in the ophthalmic market.

·; OAS is in discussion with a number of interested parties (all global players) to secure a license deal for the product in the global eyewear market which includes ophthalmic, sun, sports and protective wear.

VISARCTM is also being sampled for the displays market (laptops, e-readers, mobile-phones, televisions) and OAS is also working on qualifying the product for use in solar panel applications.

The Directors believe that 2011 will be a year of further progress for the business and look forward to updating the Market regarding future developments. 

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Information for Editors

Oxford Advanced Surfaces Group Plc (OAS) develops and licenses intellectual property (IP) solutions as a "tool kit" to create engineered surface coatings and advanced materials. Our proprietary, highly reactive chemistry platform Onto™ and advanced optical material films VISARC™, facilitate the creation of innovative products through the transformation of commodity industrial materials (e.g. polymers and/or particles), opening up new markets for the most desirable high performance advanced materials. Initial applications include advanced adhesion, anti-reflective coatings and particle delivery in markets including advanced composites and laminates, electronics, optics, displays and fast moving consumer goods.