2005 Half Year Highlights

FURTHER STRONG SALES GROWTH 2005 2004 Change Sales £92.04m £85.94m +7% Operating profit £12.18m £11.30m +8% Pre-tax profit £12.35m £11.40m +8% Earnings per share 7.95p 7.11p +12% Dividend per share 2.40p 2.00p +20% Highlights ¢ Results enhanced by strong performance from recent acquisitions ¢ Gross profit margins increased to 49.7 per cent, up from 49.1 per cent ¢ Further new products and product enhancements released during the period ¢ Net cash inflow from operating activities of £10.4m Peter Byrom, Chairman, commented 'We have produced a further period of strong sales growth, despite market conditions globally being more difficult than in the corresponding period last year. Results from our recent acquisitions have exceeded our expectations. 'Sales of our products in each of our four divisions grew compared to the corresponding period last year and we continue to achieve market share gains. We continue to experience price pressure on equipment sales in some countries. However, our global procurement and engineering programmes have delivered further quality and cost benefits, such that we have again improved our overall gross profit margin rates. 'Demand for our products remains strong. We launched a number of new products to the market in the first half year, and have more for the remainder of 2005. The combination of these new products, our acquisitions and the excellence of our existing product range means that we are well positioned for further progress in 2005.' For further information visit our website: www.domino-printing.com Issued on behalf of Domino Printing Sciences plc by Bankside Consultants Ltd - Ian Seaton Enquiries: Peter Byrom Nigel Bond Andrew Herbert Chairman Group Managing Director Group Finance Director T+44 (0)20 7367 8891 until 12.15 / T+44 (0)1954 781888 after 14.30 DOMINO PRINTING SCIENCES PLC Statement from Mr Peter Byrom, Chairman Operating Results Sales for the first six months of the year grew by 7 per cent, and by 9 per cent in local currencies, compared to the corresponding period last year. The three new businesses, Wiedenbach, Purex and Pri-Ma-Tech, acquired in February, June and November last year, accounted for 6 per cent of the growth; the core business growing by 3 per cent. Our Asian businesses continue to perform well. Sales in the Americas maintained the positive momentum experienced in the second half of last year, all of our direct sales operations in the Americas growing in excess of 10 per cent in local currencies. Sales in Europe have maintained their underlying growth rate. The A-Series continuous ink jet printer has maintained its position as the leading product in the industry. However, selling prices continue to fall in some of the major markets. On the back of the exceptional growth in equipment volumes last year, sales of fluids and services in the first half have grown strongly. The improvements in the market for our Commercial Printing products, which we reported in the second half of last year, have carried on into 2005. Sales increased by 29 per cent over the first half of last year. Unit volumes of our binary technology BitJet 212 printers more than doubled, and in May we launched an enhanced version, the BitJet plus. The transition to scribing laser technology continues. Volumes of the S-Series range of scribing lasers grew by 29 per cent as we continue to capitalise on our technology leadership position, but sales of our dot matrix products declined sharply as the market for this technology continues to shrink. Our fume extraction business, Purex, has performed ahead of expectation in the period since acquisition on 30 June 2004. The strategy of selling laser coding complete with fume extraction equipment to ensure compliance with health and safety regulations has received good acceptance from our customers. The gross profit margin of the Group for the six month period was 49.7 per cent compared to 49.1 per cent for the first six months last year. Despite ongoing pressure on selling prices and further negative impacts of foreign exchange movements, we have once again improved our margin rates through a combination of cost efficiency programmes and providing high value services to our customers. We increased research and development expenditure in the first half year to £4.9 million from £4.7 million, to invest further in new products and technology to extend our market leadership position. We have launched a number of new products in the first half year across all parts of the business, and have some exciting additions planned for the second half. Profit on ordinary activities before taxation grew by 8 per cent to £12.3 million compared to the first six months last year. Following the acquisition of the remaining 49 per cent minority interest in Sator Laser on 1 January 2005, there are no minority interests remaining in the Group. The first half year charge of £48,000 is the Sator Laser minority interest for the first two months of the financial year. After minority interests, earnings per share increased to 7.95p from 7.11p, an increase of 12 per cent. Net cash inflow from operating activities was £10.4 million. We continue to control working capital closely, but have increased field inventory both as a result of recent acquisitions and to promote new products, especially in the laser business. The Board has declared an interim dividend of 2.4 pence per share, representing a 20 per cent increase over 2004. This is covered 3.27 times. Outlook Demand for our products remains strong. We launched a number of new products to the market in the first half year, and have more for the remainder of 2005. The combination of these new products, our acquisitions and the excellence of our existing product range means that we are well positioned for further progress in 2005. Peter Byrom Chairman