It intends to build a factory with an annual production capacity of 20 million square metres in Germany, which will begin production in late 2006. The firm provided no more details of the site, but industry insiders have suggested it is near Dresden.

Currently European supplies of its PTP plate is made under contract by an unnamed third-party, believed to be Spanish firm Ipagsa.

Creo more than doubled earnings for the year to 6.2m ($11.5m), compared to 3m in 2003 on revenues up 10% to 343.3m.

Consumables revenue for the year grew by 62.3% to 41.5m.

"Creo's performance in 2004 establishes a strong foundation for growth in earnings and shareholder value," said chief executive Amos Michelson. "We doubled earnings and demonstrated tremendous growth in our first year as a digital plate vendor, exceeding our goal to increase consumables revenue by 50%."

Costs from its restructuring plan pushed the firm into the red in the fourth quarter with a loss of 700,000 on sales up 11.2% to 90.2m.

Consumables revenue was 13.1m, up 105.2% year on year and 12.6% on Q3 04.

Chief financial officer Mark Dance said: "We are expecting a 10% growth of overall revenue in 2005 and a second year of 50% plus growth in consumables revenues."

He added that the firm expected stable revenues and earnings in the first quarter of 2005 and that the effects of its cost reduction initiatives would start to be felt in the second quarter and to be fully apparent in the third quarter.

Story by Barney Cox