For the year to 31 December the companys turnover rose 6% to 24m, but pre-tax profit before exceptionals fell 40% to 1.6m. The group also took a 1m exceptional charge associated with moving production from Cambridge to Sweden. Cambridge will remain as a research and development facility.

Xaar chief executive Jan Fineman said: "We are running parallel production at the moment between Cambridge and Sweden, but it should be transferred completely by April, which will stabilise production."

Fineman said the 66% fall in revenue gained from licensing to 2m was due to the fact that the Xaar failed to conclude a full licence last year. However, he added that it was in a number of positive discussions with US companies.

"We believe that the fundamentals of the business are a strong and secure platform for the coming year. Supply has improved and we have a full order book," added Fineman.

Story by John Davies