REG - Xaar PLC - Final Results
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RNS Number : 7802X Xaar PLC 24 March 2026
24 March 2026
Xaar Plc
("Xaar", the "Group" or the "Company")
Results for the year ended 31 December 2025
Xaar, the inkjet printing technology group, announces its audited results for
the year ended 31 December 2025.
Highlights:
- Revenue from continuing operations of £60.1 million (2024:
£53.8 million), up 12% at constant currency
- Printhead revenue up 22% to £43.0 million (2024: £35.2
million)*
- Adjusted profit before tax from continuing operations of
£0.8 million (2024: (£1.0) million)
- Net cash of £4.9 million (2024: £8.2 million) after
investing £2.0 million in capex and £0.9 million in purchase of own shares
- R&D investment for Printhead and Megnajet at c.10% of
revenue, consistent with prior year
- Commercial breakthrough in jewellery wax 3D printing market
- Further progress in other key development projects
- Dongguan facility opened for ink‑delivery manufacturing;
customer demonstration and supply‑chain optimisation.
*Note printhead revenue in 2024 has been restated to include FFEI discontinued
operations, when using non-restated figure the % increase is 29%
Commenting on the performance and outlook, John Mills, Chief Executive, said:
"Xaar's differentiated technology can deposit precise volumes of high
viscosity inks with pin-point accuracy. This capability brings benefits,
increasingly in new applications which are driven by global trends towards
digital manufacturing and the need to reduce process waste. Over the last five
years, a period during which Xaar's traditional markets have been troubled,
the Group has revitalised product design and developed new products for
applications where higher viscosity or higher pigment loading offers
differentiation. This is starting to contribute to results, with printhead
revenues up 22% in 2025. Commercial breakthrough has been achieved this year
in wax 3D printing, and demonstrable progress is being made in several other
new applications.
Operationally in 2025 the focus has been on margin enhancement, including
opening a facility in Dongguan to be closer to Asian customers and to provide
better supply chain resilience and efficiency.
The timing of revenue from new applications, which generally require several
layers of customer qualification, can be uncertain. This complexity, while
sometimes challenging, eventually leads to much clearer competitive advantage,
along with a valuable annuity revenue for printheads. Early trading in 2026 is
in line with expectations. The order book is healthy for this time of year,
and the Board believes the Group is well positioned for further progress -
both in 2026 and in the longer term."
Contacts
Xaar plc
John Mills, Chief Executive Officer
Paul James, Chief Financial Officer
Beth Connolly-Atkins, Investor Relations Investor.relations@xaar.com (mailto:Investor.relations@xaar.com)
+44 (0) 1223 423 663
About Xaar plc
Xaar is an inkjet printing technology Group, providing unique printheads and
related technologies for customers worldwide. It has over thirty years of
operational experience and around 147 patents registered or pending. A key
feature of Xaar's technology is its ability to work in both two and three
dimensional substrates. It is based in the UK and has operations in the US and
China.
Operating Summary
Our priorities for 2025 were to grow printhead revenue; to further develop our
differentiated products in new applications; to improve operational
efficiencies; and to deliver financial results at or ahead of market
expectations. No trading year ever goes quite as expected, but overall 2025
was satisfactory.
2025 2024 restated(*) Change
From continuing operations**
Revenue £60.1m £53.8m 12%
Gross margin % 40% 37% 3%
Gross R&D investment*** £4.7m £4.3m 10%
Adjusted EBITDA £3.5m £2.2m 56%
Adjusted profit before tax £0.8m (£1.0m) 179%
Reported loss for the period £(3.0)m £(8.6)m (65%)
Loss from discontinued operations £(0.4)m (2.3)m 84%
Reported loss for the period £(3.4)m £(10.8)m (69%)
Adjusted earnings per share 1.1p 0.7p 0.4p
Basic loss per share (4.3)p (13.7)p 9.4p
Net cash at the period end**** £4.9m £8.2m (40%)
*Refer to Note 11 and 31 for prior year restatement details.
**This excludes the discontinued Life Sciences business of FFEI
***Group R&D investment exclusive of any capitalised costs as used to
determine adjusted profit before tax.
****Net cash includes cash, cash equivalents and treasury deposits, net of
invoice discounting facility.
Figures included in this report are subject to rounding adjustments arising
from conversion to £millions. Accordingly, figures shown for the same
category presented in different tables may vary slightly, and figures shown as
totals may not be an arithmetic aggregation of the figures that precede them.
Revenue was £60.1 million, up 12% from 2024. Adjusted operating profit was
£1.1 million (2024: £0.6 million), with adjusted profit before tax from
continuing operation of £0.8 million. Gross margins improved to 40% (2024:
37%). Adjusted Basic earnings per share were 1.1 pence (2024: 0.7 pence). The
Group ended the year with £4.9 million (2024: £8.2 million) of net cash and
remains well capitalised.
Printhead revenues grew 22%. Printhead volumes into the core ceramics market
stabilised and growth came from new products and new markets - a clear sign of
the benefits of our business development work. Commercial breakthrough was
achieved in the digital manufacture of jewellery.
Printhead sales were well supported by systems and integration activities,
with Megnajet revenues up 2%. Revenues at Engineered Print Systems ('EPS')
fell 10%, with disruption in end markets leading to a business review and
change of management early in the year. Overall progress was impacted by the
EPS revenue decline, which reduced Group revenue despite strong printhead
growth. Moving into 2026 the new product and new application pipeline at EPS
is healthy and the outlook is stronger.
Commercially the focus in 2025 was on enhanced engagement with existing
customers. We sought to improve the responsiveness of our technical support
teams and sharpen regional commercial focus, particularly in markets where
digital print adoption is gaining traction such as corrugated, textiles, wax
and Printed Circuit Board (PCB) conformal coating.
A key operational milestone was the opening of our new facility in Dongguan,
expanding our presence in Asia and supporting growing demand for our
technologies in the region. The site will manufacture ink delivery systems for
Asian OEMs and integrators, and it will house a technology partnership centre,
to strengthen customer engagement and speed up customer qualifying processes.
The facility will also offer capacity for component assembly, leaving
production linked to our core IP remaining in the UK. This will allow us to
handle rising order volumes while maintaining the quality and consistency
expected of Xaar products. Shorter supply chains for commodity components will
further enhance operational capabilities.
Strategy and Purpose
Xaar's strategic objective is the development of differentiated inkjet
printing technology businesses for the benefit of all stakeholders. Our unique
technology delivers precise deposition of specialist fluids with pin-point
accuracy. Our technology can handle higher viscosity and pigment loading than
our competitors, a capability that can offer significant advantages. Our
business model is to design and manufacture high-performance industrial inkjet
printheads, ink delivery systems and integrated equipment, offering these,
along with the necessary applications expertise, to both OEM manufacturers and
print-system integrators.
The Group is increasingly well positioned to benefit from the global trends:
both in the expansion of digital manufacturing and the need to reduce process
waste.
Xaar has been developing its technical capabilities for over thirty years,
mainly for the traditional print markets of ceramic tiles and coding &
marking. These are well established segments but have been troubled in recent
years. The Group has therefore sought to expand its application base to
improve financial consistency, raise margins and take advantage of the rapid
expansion of digital manufacturing techniques. This has led the Group into
several new markets, including:
- 3D printing, notably in Wax and Desktop 3D, where more functional
fluids offer superior printed components
- Automotive coating, where inkjet can give greater design flexibility
and significant materials savings
- Electric Vehicle (EV) battery coating, where inkjet can replace
Polyethylene Terephthalate (PET) wrap
- Packaging & Textiles, where high viscosity and lower water content
offer higher speed printing and lower energy costs
- Labelling, where high ink laydown can offer design differentiation
In each case, either high viscosity or higher pigment loading brings
demonstrable value to the end customer. Xaar is uniquely able to offer
printheads with this capability due to its patent protected architecture and
unparalleled technical know-how.
This sort of applications development is complex, requiring cooperation
between the makers of: the printhead; the fluid to be printed; and the
printing machine. Further, as with all manufacturing process developments,
several layers of customer accreditation are necessary for commercial
adoption. The timing of projects is therefore uncertain. But this complexity,
which can be frustrating, is also the key to long term advantage and provides
a significant barrier to entry for competition. Moreover, and critical to the
Board's strategy for the Group, printheads need to be replaced regularly,
leading to annuity revenue streams.
Therefore, the Group seeks to:
- Focus on applications with structural long term growth drivers where
our unique technology provides a specific advantage
- Make product development a core business activity
- Invest in complementary skills and capabilities to be able to offer a
turnkey solution for new application opportunities
- Invest in operational efficiency to maintain competitive advantage in
core markets
The Board aims to meet investment needs from free cash flow and modest
borrowing facilities. All investments are assessed against internal hurdle
rates based on strategic and financial priorities.
The Board believes that, after a period of renewal and revitalisation, Xaar is
capable of consistent long-term growth, driven by unique technology and global
manufacturing trends.
Performance by business sector
Printhead
Revenue growth of 22% was all driven by new business, with several OEMs
adopting Xaar technology for the first time.
The digital jewellery wax market continued its expansion with a growth in our
market share, with traditional methods of manufacture being replaced by
digital printing. Revenues into the ceramics market stabilised as market
conditions normalised. Declines in this market, linked to fundamental changes
in Chinese domestic property activity, has been a headwind for Xaar for some
time and the Board is pleased to see newer applications featuring in results.
The Printhead division is increasingly positioned around high‑value
industrial opportunities where Xaar's strengths in reliable high‑viscosity,
jetting provides a clear competitive advantage. As these projects develop, and
each new application is qualified, we expect to grow a wider base for the
business, which, in conjunction with annuity printhead replacement, should
allow for more consistent financial performance over time.
Megnajet
Megnajet specialises in inkjet fluid management, domain knowledge critical to
printhead development. Demand for its high‑precision ink delivery systems
comes from applications where consistency, control and reliability are
critical.
In 2025, Megnajet revenue growth was 2%, helped by an increased uptake of
modular platforms, which simplify customer integration and enhance the
performance of our latest printheads.
Engineered Print Systems (EPS)
EPS delivered revenue of £14.5 million in 2025 (2024: £16.1 million),
reflecting generally difficult end markets in the US, the ending of a
multi-year project in 2024, and a refocussing of priorities under new
management.
The new leadership team has strengthened project execution, refined the
commercial pipeline and improved overall business discipline. In 2026 EPS is a
more streamlined, better‑positioned organisation.
Environmental, Social and Governance (ESG)
Xaar products help customers to adopt digital manufacturing techniques which
reduce waste and energy usage. Our research shows that, compared to analogue
alternatives, digital manufacturing has a significant impact in reducing
energy consumption (by as much as 55%), water consumption (by up to 60%) and
CO2 emissions (by up to 95%). Xaar's ESG roadmap has five key pillars -
Environment, People, Innovation, Community and Governance. In 2025:
- We advanced initiatives to reduce waste, energy use and refrigerant
leaks, reducing Scope 1 & 2 emissions.
- We expanded training and development programmes to support skills,
career pathways, and employee wellbeing.
- We strengthened governance structures supporting risk management,
safety, and ethical conduct.
Xaar is committed to reducing its impact on the environment wherever possible
and helping customers do the same.
Dividend
The Board has not declared a dividend for 2025. We continue to assess
capital allocation carefully and remain committed to maintaining the balance
between investing for future growth and delivering shareholder returns.
Staff and Board Changes
The Board maintains direct contact with staff through regular site visits
during which the commitment and enthusiasm of staff is evident. We are very
grateful for their hard work and dedication. They have been through several
years of transition with Xaar, and without them we would not be looking
forward to the range of opportunities we now have before us.
There have been Board changes during the year. As previously announced, Paul
James joined the Group in January 2025 and is now established as an effective
and influential CFO. After nine years Andrew Herbert stepped down as Chair in
September. The Group is indebted to him for his leadership through a renewal
agenda: strengthening the Board, developing new products suitable for new
markets; and improving business processes. He left Xaar revitalised and well
positioned. Ben Stocks joined the Board in October 2025 as Chair. Ben was CEO
of Porvair PLC from 1998 to 2025. He is a non-executive director of the City
of London investment Group and the Aerospace Technology Institute.
Outlook
Xaar's differentiated technology can deposit precise volumes of high viscosity
inks with pin-point accuracy. This capability brings benefits, increasingly in
new applications which are driven by global trends towards digital
manufacturing and the need to reduce process waste. Over the last five years,
a period during which Xaar's traditional markets have been troubled, the Group
has revitalised product design and developed new products for applications
where higher viscosity or higher pigment loading offers differentiation. This
is starting to contribute to results, with printhead revenues up 22% in 2025.
Commercial breakthrough has been achieved this year in wax 3D printing, and
demonstrable progress is being made in several other new applications.
Operationally in 2025 the focus has been on margin enhancement, including
opening a facility in Dongguan to be closer to Asian customers and to provide
better supply chain resilience and efficiency.
The timing of new application projects, which generally require several layers
of customer qualification, can be uncertain. This complexity, while sometimes
challenging, eventually leads to much clearer competitive advantage, along
with - for printheads - valuable annuity revenue. Early trading in 2026 is in
line with expectations. The order book is healthy for this time of year, and
the Board believes the Group is well positioned for further progress - both in
2026 and in the longer term.
John Mills
March 24, 2026
Financial review
Group revenue for continued operations for the year ended 31 December 2025 was
£60.1 million (2024: £53.8million). Adjusting for currency and discontinued
operations, revenue growth was 12%, driven primarily by a 22% increase in
printhead revenue. Gross margin improved to 40% (2024: 37%), supported by
enhanced manufacturing yields, efficiency improvements and a more favourable
product mix.
Adjusted Profit before tax ("aPBT") was £0.8 million (2024: loss (£1.0)
million). Operational enhancements enacted in 2024 lowered costs and improved
overhead absorption. Basic (loss) per share was (4.3) pence (2024: (13.7)
pence). Adjusted earnings per share was 1.1 pence (2024: loss (0.7) pence).
Gross profit for the year was £23.7 million (2024: £19.6 million),
reflecting better operational performance and favourable product mix. These
gains supported overall margin expansion and improved operating leverage
across the Group.
The year ended with net cash of £4.9 million (2024: £8.2 million). Much more
focus has been given to working capital management with a particular emphasis
on setting the conditions to consistently increase stockturn in the future.
Forecast accuracy is now being measured with a view to reducing buffer stocks
yet still maintaining good component availability. Cash inflows were partially
offset by £1.6 million of lease payments (2024: £1.2 million) and capital
expenditure of £2.0 million (2024: £0.9 million). Xaar continues to operate
with no long-term structural debt, maintaining strong liquidity and the
flexibility to invest. Total assets decreased modestly to £78.3 million
(2024: £81.3 million), driven by reduction in cash. Inventories decreased
slightly at £26.6 million (2024: £27.2 million), whilst trade receivables
were £9.3 million (2024: £8.1 million).
Total operating expenditure was £17.9 million (2024: £16.0 million) which
includes a £1.8 million bonus accrual (2024: £nil). Sales and marketing
costs were £5.1 million (2024: £4.6million), reflecting cost discipline and
improved digital engagement. General and administrative expenses were £12.8
million (2024: £11.4 million).
The transition of FFEI manufacturing to Huntingdon delivered a full year of
cost benefits, and the closure of the Hemel Hempstead site further simplified
our operational footprint. Combined, these actions lowered our cost base and
contributed to improved divisional profitability.
Research & Development
Gross Group R&D investment totalled £4.7 million, representing 8% of
revenue (2024: £4.3 million; 8%), keeping us within our target range of
8-10%. Investment shifted further toward application-led development, OEM
integration and enhancements to fluid management and platform reliability.
Financing
The Group has finalised an enlarged Revolving Credit Facility with its
bankers, increasing the facility from £5 million to £10 million together
with an uncommitted £5 million "accordion" facility. The formal approval was
received 19 March 2026.
Divisional Results
Printhead
Printhead revenue increased to £43.0 million (2024: £35.2 million), with
ceramics revenue decreased by £0.6 million, marking a slowing in the rate of
decline from this legacy market.
2025 2024 Variance %
Revenue £43.0m £35.2m 22%
Gross Margin % 41% 38% 3%
aOperating Profit £5.7m £3.0m 88%
aPBT £5.5m £2.7m 105%
Megnajet
Megnajet generated £2.6 million in revenue, up 2% year‑on‑year.
Intra‑Group sales rose by 38%, reinforcing Megnajet's importance in
supporting system reliability, fluid‑management performance and printhead
platform commercialisation to the Group.
2025 2024 Variance %
Revenue £2.6m £2.5m 2%
Gross Margin % 44% 51% (7%)
aOperating Profit £0.8m £1.1m (27%)
aPBT £0.9m £1.2m (28%)
Engineered Printing Systems (EPS)
EPS revenues were £14.5 million, falling 10%, as the business underwent a
period of review under new management. A major multiyear engineering programme
did not repeat in 2025, and there was general customer caution around new
equipment purchases.
During the year, the business implemented a targeted restructuring programme
focused on strengthening project execution, improving cost discipline and
widening the customer pipeline.
2025 2024 Variance %
Revenue £14.5m £16.1m (10%)
Gross Margin % 36% 31% 5%
aOperating Profit £1.3m £1.2m 11%
aPBT £1.3m £1.2m 11%
Taxation
The Group recognised a total tax credit from continuing operations of £0.2
million (2024: £0.8 million). The underlying effective tax rate was 6.3%
(2024: 6.6%).
As previously disclosed, historic overseas tax liabilities (primarily indirect
taxes) estimated at £2.7 million, were identified during a review of local
compliance processes which will be settled over the next two years. These
non-recurring items are not expected to impact future trading.
Dividend and Reserves
Shareholder equity closed the year at £56.3 million (2024: £59.9 million).
Retained earnings were £11.9 million (2024: £14.8 million), and foreign
exchange translation movements totalled (£0.2) million (2024: £0.1 million).
No dividend has been declared for 2025, reflecting our commitment to
reinvestment in technology, operational capability and long-term capacity
expansion.
Capital Expenditure
Capital expenditure for the year totalled £2.0 million (2024: £0.9 million),
with investment concentrated on manufacturing capacity, ink delivery systems,
back end printhead capability and platform development to support expected
order growth.
Finance and Treasury Policy
Xaar's treasury activities are managed centrally under Board oversight, with
the primary objective of safeguarding liquidity, managing financial risk, and
supporting the Group's operational and strategic requirements. The function
operates within a clear policy framework designed to limit the Group's
exposure to short‑term currency fluctuations.
The Group finances its operations through a combination of share capital,
retained earnings and, where appropriate, bank facilities. The Group has
adequate committed facilities in place to support trading and investment.
Paul James
March 24, 2026
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2025
Year ended 31 December 2025 Year ended 31 December 2024 (restated)*
Adjusted Adjusting Items** Total Adjusted Adjusting Items** Total
Notes £'000 £'000 £'000 £'000 £'000 £'000
Revenue 2 60,055 - 60,055 53,754 - 53,754
Cost of sales (36,363) - (36,363) (34,128) - (34,128)
Gross profit 23,692 - 23,692 19,626 - 19,626
Selling, general and administrative expenses 4 (17,868) (4,564) (22,432) (15,972) (8,559) (24,531)
Research and development expenses 4 (4,676) 549 (4,127) (4,260) 147 (4,113)
Operating profit / (loss) 1,148 (4,015) (2,867) (606) (8,412) (9,018)
Finance income 67 - 67 85 - 85
Finance costs (461) - (461) (439) - (439)
Profit / (Loss) before tax from continuing operations 754 (4,015) (3,261) (960) (8,412) (9,372)
Tax credit / (charge) 109 133 242 277 538 815
Profit / (Loss) for the year from continuing operations 863 (3,882) (3,019) (683) (7,874) (8,557)
Loss from discontinued operations after tax (18) (354) (372) 1,225 (3,489) (2,264)
Loss for the year 845 (4,236) (3,391) 542 (11,363) (10,821)
(Loss) / earnings per share - Total 3
Basic earnings / (loss) per share 1.1 (4.3) 0.7 (13.7)
Diluted earnings / (loss) per share 1.1 (4.3) 0.6 (13.7)
(Loss) / earnings per share - Continuing operations 3
Basic earnings / (loss) per share 1.1 (3.8) (0.9) (10.8)
Diluted earnings / (loss) per share 1.1 (3.8) (0.9) (10.8)
* Refer to Note 7 for prior year restatement details.
** Further information on adjusting items is included in Note 4.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
Year ended 31 Year ended 31 December (restated)* 2024
December 2025
£'000 £'000
Loss for the year attributable to the equity of the shareholder of the parent (3,391) (10,821)
Items that may be reclassified to the income statement in subsequent years
Exchange gains/(losses) on translation of foreign operations (238) 88
Other comprehensive expense for the year (238) 88
Total comprehensive expense for the year (3,629) (10,733)
Total comprehensive (expense) / income for the year attributable to equity
shareholders of the parent arises from:
Continued operations (3,257) (8,469)
Discontinued operations (372) (2,264))
(3,629) (10,733)
* Refer to Note 7 for prior year restatement details.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2025
31 December 2025 31 December 2024 (restated)* 31 December 2023 (restated)*
£'000 £'000 £'000
Non-current assets
Goodwill 6,576 6,959 6,873
Other Intangible assets 5,677 5,136 7,366
Property, plant and equipment 12,625 12,490 14,529
Right of use asset 4,193 4,734 7,826
Deferred tax asset 1,734 1,548 1,134
Financial asset at fair value through profit or loss 2,672 3,063 8,277
Non-current financial assets 100 104 136
33,577 34,034 46,141
Current assets
Inventories 26,559 27,236 31,035
Trade and other receivables 9,320 8,084 8,802
Contract assets 514 1,018 2,156
Current tax receivable 1,080 346 306
Financial asset at fair value through profit or loss 1,862 1,854 2,322
Cash and cash equivalents 5,349 8,711 7,135
44,684 47,249 51,756
Total assets 78,261 81,283 97,897
Current liabilities
Trade and other payables (11,158) (8,782) (9,568)
Deferred consideration - - (2,115)
Provisions (3,655) (3,794) (4,022)
Contract liabilities (1,533) (1,986) (2,369)
Borrowings (475) (557) (1,403)
Lease liabilities (701) (1,218) (1,800)
(17,522) (16,337) (21,277)
Net current assets 27,162 30,912 30,479
Non-current liabilities
Lease liabilities (4,195) (4,710) (6,898)
Provisions (250) (300) (300)
Other payables (15) - -
(4,460) (5,010) (7,198)
Total liabilities (21,982) (21,347) (28,475)
Net assets 56,279 59,936 69,422
Equity
Share capital 7,982 7,948 7,923
Share premium 30,011 30,011 29,950
Own shares (1,125) (566) (566)
Translation reserves 1,277 1,515 1,427
Other reserves 6,256 6,256 6,256
Retained earnings 11,878 14,772 24,432
Total equity 56,279 59,936 69,422
* Refer to Note 7 for prior year restatement details.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
Share capital Share premium Own shares Translation reserve Other reserves Retained earnings Total equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance as at 1 January 2024 reported 7,923 29,950 (566) 1,318 6,256 26,624 71,505
Restatement - - - 109 - (2,192) (2,083)
Balance as at 1 January 2024 restated* 7,923 29,950 (566) 1,427 6,256 24,432 69,422
Loss for the year* - - - - - (10,821) (10,821)
Other comprehensive income* - - - 88 - - 88
Total comprehensive income - - - 88 - (10,821) (10,733)
Issue of ordinary shares 25 61 - - - - 86
Exercise of share options - - - - - (18) (18)
Share-based payments - - - - - 1,179 1,179
Balance as at 31 December 2024 restated* 7,948 30,011 (566) 1,515 6,256 14,772 59,936
Loss for the year - - - - - (3,391) (3,391)
Other comprehensive income - - - (238) - - (238)
Total comprehensive income - - - (238) - (3,391) (3,629)
Issue of ordinary shares 34 - - - - - 34
Purchase of ordinary shares - - (900) - - - (900)
Exercise of share options - - 341 - - (375) (34)
Share-based payments - - - - - 872 872
Balance as at 31 December 2025 7,982 30,011 (1,125) 1,277 6,256 11,878 56,279
*Refer to note 7 for prior year restatement details
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2025
Year ended Year ended 31 December 2024
31 December 2025
Notes £'000 £'000
Adjusted cash generated/(utilised) by operations 6 4,458 6,796
Exceptional cash outflows (2,654) (803)
Net income taxes (paid) / received (27) 605
Net cash inflow/(outflow) from operating activities 1,777 6,598
Investing activities
Interest income received 145 134
Purchases of property, plant and equipment (1,950) (936)
Proceeds from sale of property, plant and equipment 4 -
Purchases of intangible assets (998) (86)
Cash earn-out received from financial assets at FVTPL 207 120
Net cash (outflow)/inflow from investing activities (2,592) (768)
Financing activities
Proceeds from issue of shares - 69
Purchase of own shares (900) -
Lease payments (1,603) (1197)
Interest paid (128) (87)
Net (outflows) inflows from invoice discounting facility (82) (941)
Payment of deferred consideration - (2,133)
Net cash outflow in financing activities (2,713) (4,289)
Net increase/(decrease) in cash and cash equivalents (3,528) 1,541
Cash and cash equivalents at beginning of year 8,711 7,135
Effect of foreign exchange rates 166 35
Cash and cash equivalents at end of year 5,349 8,711
Borrowings at end of year (475) (557)
Net Cash at the end of the year 4,874 8,154
FOR THE YEAR ENDED 31 DECEMBER 2025
1. Presentation of the financial information
A) General information
Xaar plc (the Company, and together with its subsidiaries, the Group) is a
public limited company whose shares are listed on the London Stock Exchange,
is incorporated and domiciled in the UK and is registered in England under the
Companies Act 2006.
B) Basis of preparation
The consolidated financial statements have been prepared in accordance with
UK-adopted International Accounting Standards and with the requirements of the
Companies Act 2006.
The consolidated financial statements include the results of the Company and
its subsidiaries (together 'the Group'). The Group's directly and indirectly
held subsidiary undertakings are disclosed in note C6 to the company financial
statements.
The consolidated financial statements have been presented in Sterling, the
functional and presentational currency of the Company. Certain Group
subsidiary entities have functional currencies other than Sterling. The
financial position and performance of all such subsidiary entities is
translated into the presentational currency (Sterling) in accordance with the
foreign currencies accounting policy as detailed in Note 1.
The consolidated financial statements have been prepared under the historical
cost convention as modified for the revaluation of certain financial
instruments. All values are rounded to the nearest thousand pounds (£'000)
except when otherwise indicated.
C) Alternative performance measures
The alternative performance measures (APMs) used by the Group adjust for both
recurring and non-recurring items that the Directors consider are not
reflective of the underlying performance of the Group. Recurring items are
adjusted each year irrespective of materiality to ensure consistent treatment.
The Directors believe that the 'adjusted profit before tax' and 'adjusted
earnings per share' measures presented provide a consistent presentation of
the Group's underlying operational performance. They also present shareholders
with a clearer insight of performance metrics used by the Chief Operating
Decision Maker and mitigate volatility for example resulting from exchange
rate fluctuations, resulting from external factors that are not influenced by
the Group.
These measures are not defined under IFRS; therefore, they may not be directly
comparable with the 'adjusted' profit measures of other companies.
Adjusting items are defined as follows:
- fair value gains or losses on financial assets at FVTPL;
- restructuring and transaction expenses;
- amortisation of intangible assets arising on business combinations;
- foreign exchange gains or losses arising on intra-group transactions;
- research and development expenditure credits and patent box tax
credits;
- share-based payments charges and employer's tax contributions thereon;
- asset impairment outside of the ordinary course of business;
- legal provisions;
- start up costs of new ventures and
- the tax effect of the aforementioned adjusting items.
D) Going Concern
The consolidated financial statements are prepared on a going concern basis.
Having considered the Group's forecast financial performance and cash flows,
and after making appropriate enquiries, the Directors have a reasonable
expectation that the Group has adequate financial resources to continue in
operational existence for the foreseeable future and for at least one year
from the date that these consolidated financial statements are signed. For
these reasons, they continue to adopt the going concern basis in preparing the
consolidated financial statements. Accordingly, these financial statements do
not include any adjustments to the carrying amount or classification of assets
and liabilities that would result if the Group were unable to continue as a
going concern.
In preparing forecasts Xaar considers all external factors that could impact
on financial performance and makes appropriate allowances for these. The
forecast informing the decision to prepare the consolidated financial
statements on a going concern basis considered, among other things; the
likelihood of inflationary pressures resulting from macro-economic factors,
and the unrest in Ukraine & Gaza and the wider Middle East. The impact of
tariffs continues to be evaluated and we are working closely with our
customers, suppliers and advisors to navigate and mitigate impacts in this
area. Furthermore, forecasts have been subject to sensitivities to assess the
impact on revenue generation, profitability and liquidity of wider market
disruption in certain customer and supplier markets and uncertainty in timing
of revenues expected from significant strategic opportunities.
A reverse stress test has been performed to model the circumstances required
to eliminate available liquidity during the going concern period, this
includes reducing revenues. This reverse stress scenario would require a
reduction in Group revenue in excess of 20% in comparison to the base case,
before considering any significant mitigating actions, The Directors believe
the possibility of this combination of severe downsides arising to be remote
given the recurring revenue base, visibility of committed orders and expected
new revenue streams secured from products known to be launching by OEMs
throughout 2026.
In the unlikely event of such a scenario materialising, the Group has a range
of mitigating actions, focused on reducing the Group's cost base, that could
be taken to avoid a liquidity shortfall. Namely, deferring non-committed
capital expenditure, delaying, or suspending research and development
expenditure, and/or ultimately even making headcount reductions. It is worth
noting that such actions would only be required in the event of an extreme
downside scenario.
The Group is continuously monitoring and mitigating, where possible, the
impacts of such risks. There is a high degree of predictability within the
Group's short-term cash flows as they reflect existing technologies and
products, existing OEM adoption and the committed order pipeline. The level of
sensitivity testing, and reverse stress testing performed is proportionate to
this level of predictability.
The Group continues to have a net current assets position and maintains
sufficient financial resources as at 31 December 2025. These consisted of cash
and cash equivalents of £5,349,000 as well as £5,000,000 of committed, but
undrawn, banking facilities made available under a revolving credit facility
agreement. Post year end in March 2026 this revolving credit facility was
extended for a further three years to June 2029 and increased to £10,000,000.
The revolving credit facility is subject to leverage, interest cover and
capital expenditure threshold covenants. In addition, to support the Group's
working capital position, alongside the above core banking facilities, the
Group also has access to ancillary funding arrangements in the form of an
invoice discounting facility, of which £475,000 of the total £3,000,000
committed facility was utilised as at 31 December 2025.
2. Operating segments
The Group's operating segments are determined based on the internal reporting
to the Chief Operating Decision Maker (CODM). The CODM has been determined
to be the Chief Executive Officer, with support from the other members of the
Board of Directors, being the individual who is primarily responsible for the
allocation of resources to segments and the assessment of performance of the
segments.
The principal activities of the Group are presented in the following segments:
'Printhead', 'EPS', 'Megnajet' and the discontinued 'FFEI'. This presentation
reflects how the Group's operating performance is reviewed internally by
management.
In 2024 the 'FFEI' business unit was reorganised into two separate major lines
of business, Life Sciences and Printbar. The Printbar part of FFEI was
gradually integrated with Printhead and Life Sciences part of the business was
gradually reduced until finally being abandoned in Q1 2025. The FFEI segment
has been restated to include only the discontinued operations. Refer
discontinued operations note 5.
Year ended 31 December 2025 Printhead Engineering Print Solutions Megnajet Head office Entities Total Continuing Discontinued - FFEI TOTAL
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Revenue - total 44,420 14,460 3,779 - 62,659 314 62,973
Revenue - intra segment (1,390) - (1,214) - (2,604) - (2,604)
Revenue - external 43,030 14,460 2,565 - 60,055 314 60,369
Adjusted operating profit/(loss) 5,712 1,341 799 (6,704) 1,148 (60) 1,088
Adjusting items [note 7] (200) (1,129) (355) (2,331) (4,015) (360) (4,375)
Operating profit/(loss) 5,512 212 444 (9,035) (2,867) (420) (3,287)
Year ended 31 December 2024 Printhead* Engineering Print Solutions Ink Supply Systems (Megnajet) Head office Entities Total Continuing Discontinued - Digital Imaging (FFEI)* TOTAL
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Revenue - total 37,075 16,807 3,417 - 57,299 7,654 64,953
Revenue - intra segment (1,908) (731) (906) - (3,545) - (3,545)
Revenue - external 35,167 16,076 2,511 - 53,754 7,654 61,408
Adjusted operating profit/(loss) 3,045 1,211 1,093 (5,955) (606) 1,273 667
Adjusting items (772) (867) (363) (6,410) (8,412) (3,481) (11,893)
Operating profit/(loss) 2,273 344 730 (12,365) (9,018) (2,208) (11,226)
*Restated Printhead to include the printbar part of the continuing operations
migrated from FFEI - refer note 5.
3. Earnings per share
Basic earnings per share and adjusted basic earnings per share are calculated
by dividing the earnings attributable to the equity shareholders of the
Company by the weighted average number of shares outstanding during the year.
Diluted earnings per share and adjusted diluted earnings per share are
calculated on the same basis as basic earnings per share but with a further
adjustment to the weighted average number of shares outstanding to assume
conversion of all potentially dilutive ordinary shares. Such potentially
dilutive ordinary shares comprise share options and awards granted to
employees where the exercise price is less than the average market price of
the Company's ordinary shares during the year and any unvested shares which
have met, or are expected to meet, the performance conditions at the end of
the year.
Year ended Year ended
31 December 2025 31 December 2024 restated*
£'000 £'000
(Loss)/Profit from continuing operations - adjusted 863 (683)
Adjusting items - continuing operations (3,882) (7,874)
(Loss) / profit from continuing operations - reported (3,019) (8,557)
(Loss) / profit from discontinued operations - adjusted (18) 1,225
Adjusting items - discontinued operations (354) (3,488)
(Loss) / profit from discontinued operations -reported (372) (2,263)
(Loss) / profit attributable to equity shareholders of the parent - reported (3,390) (10,820)
* Refer to Note 7 for prior year restatement details.
Number Number
Number of shares
Weighted average number of ordinary shares in issue 79,530,296 79,377,941
Less: ordinary shares held by Xaar Trustee Limited and the Xaar Plc ESOP Trust (516,739) (313,201)
Weighted average number of ordinary shares for the purposes of basic EPS 79,013,557 79,064,740
Effect of potentially dilutive ordinary shares - share options and awards 1,058,996 2,581,021
Weighted average number of ordinary shares for the purposes of diluted EPS 80,072,553 81,645,761
Pence per share Pence per share*
Basic loss per share - continuing operations (3.8) (10.8)
Basic loss per share - discontinued operations (0.5) (2.9)
Basic loss per share (4.3) (13.7)
Diluted loss per share - continuing operations (3.8) (10.8)
Diluted loss per share - discontinued operations (0.5) (2.9)
Diluted loss per share (4.3) (13.7)
Adjusted basic earnings / (loss) per share - continuing operations 1.1 (0.9)
Adjusted basic earnings per share - discontinued operations (0.0) 1.5
Adjusted basic earnings per share 1.1 0.7
Adjusted diluted earnings / (loss) per share - continuing operations 1.1 (0.9)
Adjusted diluted earnings per share - discontinued operations (0.0) 1.5
Adjusted diluted earnings per share 1.1 0.6
4. Adjusting items
The Directors believe that the 'adjusted profit before tax' and 'adjusted
earnings per share' alternative performance measures presented provide a
consistent presentation of the Group's underlying operational performance.
They also present shareholders with a clearer insight of performance metrics
used by the Chief Operating Decision Maker and mitigate volatility, resulting
from external factors that are not influenced by the Group.
These items are as defined below and have been presented consistently in both
the current and prior year.
Year ended 31 December Year ended 31 December
2025 2024
£'000 £'000
Share-based payment charges (i) (831) (980)
Exchange (losses)/gains on intra-group transactions (ii) (463) 110
Restructuring and transaction expenses (iii) (2,197) (730)
Research and development expenditure tax credits (iv) 549 147
Fair value losses on financial assets at FVTPL (v) (182) (5,561)
Amortisation of intangible assets arising on business combinations (vi) (330) (530)
Impairment of contract assets (vii) - (514)
Legal provision (viii) (27) (191)
System implementation (ix) (461) (163)
System implementation (x) (73) -
Affecting operating profit and profit before tax (4,017) (8,412)
Tax effect of adjusting items 133 538
Total adjusting items after tax (3,882) (7,874)
(i) Comprises total share-based payment charges of £886,000 (2024:
£1,182,000) partially offset by an accrual release of £31,000 (2024: release
of £85,000) for the associated employer's social security contributions and
are included in selling, general and administrative expenses. Further excluded
from the table above is discontinued operations impact of £24,000 (2024:
£117,000)
(ii) Comprises exchange gains or losses as a result of USD denominated
intra-group loans between UK and US entities. Such costs are included in
selling, general and administrative expenses.
(iii) Comprises redundancy related costs of £1,028,000 (2024: £1,132,000),
Group's operational efficiency programs £944,000 (2024: £14,000 credit),
start up costs relating to the group China expansion of £225,000 (2024:
£Nil) and M&A transaction costs of £nil (2024: £182,000). Such costs
are included in selling, general and administrative expenses.
(iv) Comprises UK corporation tax relief relating to qualifying research and
development expenditure. During year ended 31 December 2025, £549,000
(2024: £134,000) related to XaarJet Limited and £nil (2024:£81,000) related
to FFEI Limited. These credits are included in research and development
expenses.
(v) Comprises the fair value movement on contingent consideration that
arose on the Group's divestment of Xaar 3D Limited. Such amounts are included
in selling, general and administrative expenses. Refer to Note 28 for further
information.
(vi) The intangible assets consist of the software, patents and customer
relationships recognised on acquisition of FFEI Limited in 2021 and the
customer relationships and brand value recognised on acquisition of Megnajet
Limited in 2022. These costs are included in selling, general and
administrative expenses.
(vii) During 2024 it became apparent that we would be unable to collect the
full contract value on a contract which commenced in 2021 in our Product Print
systems business segment. This contract was therefore impaired to the expected
recoverable amount. No profits have been recognised on this contract in the
current or preceding year.
(viii) A legal matter provided for in the 2024 annual
report dating back to 2021. £27,000 has been recognised as an expense the
current year (2024: £191,000). A cash settlement of £278,000 was made during
the 2025 year and a true up made in this regard.
(ix) During 2025, the Directors identified certain indirect tax liabilities
to settle in an overseas jurisdiction. The recognised provision, comprised of
the tax liability calculated and imputed interest amounts to £2,700,000.
Legal and consultants' fees incurred in 2025 amount to £396,000 (2024: nil),
a further £65,000 is an increase to the provision raised to cover indirect
tax and interest. Prior year has also been restated, refer Note 7.
(x) Comprises the costs incurred for the implementation of a new reporting
software application and payroll software migration.
5. Discontinued operations
In 2024 the 'Digital Imaging' business unit (FFEI Limited) was reorganised
into two separate major lines of business, Life Sciences and Printbar. The
Printbar part of the business was gradually migrated to Xaar Jet Limited for
efficiency reasons and the Life Sciences part business which was gradually
reduced until finally being abandoned in Q1 2025.
The abandonment of Digital Imaging represents a discontinued operation as per
IFRS 5, as such the following statements and notes have been restated:
- Consolidated income statement
- Consolidated cashflow statement
- Note 2 (operating segments)
- Note 3 (earnings per share)
Due to the integrated nature of the support functions whilst Digital Imaging
was operating both Printbar and Life Sciences, the Group was unable to
directly isolate all expenses and cashflows of the discontinued operation.
Accordingly, all items which are not revenue have been allocated on a basis of
the proportion of revenue attributable to the discontinued operation.
Management believes these allocations provide a reasonable approximation of
the financial performance of the discontinued operation.
Year ended 31 December 2025 Year ended 31 December 2024
Adjusted Total Adjusted Total
Adjusting Items Adjusting Items
£'000 £'000 £'000 £'000 £'000 £'000
Revenue 314 - 314 7,654 - 7,654
Cost of sales 46 - 46 (5,063) - (5,063)
Gross profit 360 - 360 2,591 - 2,591
Selling, general and administrative expenses (154) - (154) (996) 81 (915)
Research and development expenses (266) (360) (626) (322) (3,563) (3,885)
Operating loss (60) (360) (420) (1,273) (3,482) (2,209)
Finance income 78 - 78 49 - 49
Finance costs (16) - (16) (56) - (56)
Profit / (Loss) before tax 2 (360) (358) 1,266 (3,482) (2,216)
Tax credit / (charge) (20) 6 (14) (41) (7) (48)
Total loss for the year (18) (354) (372) 1,225 (3,489) (2,264)
6. Note to cash flow statement
31 December 2025 31 December 2024
£'000 £'000
Loss before tax from continuing operations (3,261) (9,372)
Loss before tax from discontinued operations (358) (2,216)
Loss before tax: (3,619)
Adjustments for:
Depreciation and impairment of property, plant and equipment 2,479
Depreciation and impairment of right-of-use assets 774
Amortisation and impairment of intangible assets 443
Research and development expenditure credit (549)
Net interest expense 331
Unrealised currency translation losses/(gains) 389
Share-based payment charge 855
Fair value loss on financial assets at FVTPL 177
Loss on disposal of property, plant and equipment 111
Loss on disposal of intangible assets 14
Profit on disposal of right of use assets (8)
Decrease in provisions (189)
Operating cash flows before movements in working capital 1,208
(Increase)/decrease in inventories (467)
(Increase)/decrease in receivables (1,079)
Increase/(Decrease) in payables 2,142 (1,172)
Cash generated by operations 1,804 5,993
Exceptional Cash outflows included above 2,654 803
Adjusted cash generated by operations 4,458 6,796
7. Restatement of prior period
During 2025, the Directors identified certain tax liabilities to settle in an
overseas jurisdiction. Following a detailed review with the support of subject
matter advisors, we have assessed the present obligation associated with this
matter to be approximately £2,713,000 including interest and excluding
penalties. These tax liabilities pre-date 2023 by a number of years and as
such the adjustment of £2,192,000 to 2023 Retained Earnings is the cumulative
impact of 2023 and all previous years. The provision is comprised of the tax
liability calculated and imputed interest. Potential penalties in respect of
this matter have been disclosed as a contingent liability in line with the
requirements of IAS 37.
The errors have been corrected by restating each of the affected financial
statement line items for the prior periods as follows:
Consolidated statement of financial position (extract) 31 December Equity increase/ (decrease) 31 December 2023 Equity increase/ (decrease)
2024 31 December 2024 31 December
(restated) 2023
(restated)
£'000 £'000 £'000 £'000 £'000 £'000
Current provisions (951) (2,843) (3,794) (1,385) (2,637) (4,022)
Deferred tax asset 951 597 1,548 580 554 1,134
Translation reserved 1,440 75 1,515 1,318 109 1,427
Retained Earnings 17.093 (2,321) 14,772 26,624 (2,192) 24,432
Total Equity 62,182 (2,246) 59,936 71,505 (2,083) 69,422
Consolidated income statement (extract) 2024 Reported Reclassified to Discontinued operations* Profit increase / (decrease) 2024 Restated
£'000 £'000 £'000 £'000
Selling, general and administrative expenses (28,253) 3,884 (163) (24,532)
Operating (loss) / profit (11,064) 2,209 (163) (9,018)
(Loss) / profit before tax (11,425) 2,216 (163) (9,372)
Tax credit 733 48 34 815
(Loss) for the year attributable to the equity shareholder of the parent (10,692) - (129) (10,821)
Statement of comprehensive income (extract) 2024 Reported Reclassified to Profit increase / (decrease) 2024 restated
Discontinued operations*
£'000 £'000 £'000 £'000
Loss for the year attributable to the equity shareholders of the parent (10,692) - (129) (10,821)
Exchange gains / (losses) on translation of foreign operations 122 - (34) 88
Total Comprehensive (expense) for the year (10,570) - (163) (10,733)
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