The Cambridge-based company reported a pre-tax profit before exceptional items of £1.3m, compared to a loss of £300,000 for the second half of 2008.

Xaar said that a recovery in market share in the Chinese market, following an aggressive sales strategy that included new product launches, was partially responsible for the upturn in the company's figures.

The inkjet developer is currently in the process of developing its Platform 3 technology, which includes the flagship 1001 piezo printhead, with third parties adding a further 10 machines using the technology in the six-month period.

However, chief executive Ian Dinwoodie expressed his continuing frustration with the slow take-up of the latest inkjet technology.

"People are quick to drop the old technology but slow to the pick the new," he said. "However, we currently have 25 Platform 3 customer products announced and are in the final phase with 23 of these. In addition, there are an additional 20 products in the R&D phase."

The company's half-year performance recorded a year-on-year decline in revenues in the graphic arts and industrial sector while the packaging sector remained stable with £4.8m of sales in the first half of 2009 – the same figure as the previous year.

Dinwoodie said that he saw the nascent inkjet label press and packaging market as a major growth area, as well as niche areas, for example, building material decoration such as ceramic tiles.

Xaar is in the process of relocating its manufacturing base from Sweden to Huntingdon UK, which the company said is going according to plan.

Finance director Andrew Taylor said the move would eliminate the company's exposure to the volatile currency fluctuations of the Swedish Krona, which cost the group £1.3m in the period.