Trading Statement

Lo-Q PLC
14 December 2006

                                    Lo-Q plc

                           ('Lo-Q' or the 'Company')

                                 Trading Update



With the season over and the majority of the parks in which the Company operates
now being closed for the winter, the board of Lo-Q (the 'Board') would like to
provide an update on the progress made by the Company this year.



The Company is pleased to announce that it has had a very successful season in
the theme parks in which it operates with Q-bots selling well. This is
attributable to the performance of the US team, led by Steve Drake, supported by
a product that continues to have a remarkable quality record.  The Q-bot rental
revenue to date has performed ahead of management expectations.



The Company also announces that it has concluded negotiations with Palmtop
Productions Inc. ('Palmtop'), the owners of a theme park line management patent
based on hand-held personal organisers. Whilst it was alleged that Lo-Q has been
contravening their patent, the Company's lawyers and specialist patent attorneys
believe this not to be the case.  As a result it had been the view of the Board
that this claim could be successfully defended.  After weighing the balance of
risk present in any USA patent law case, the Company made the decision to pursue
an out of court agreement to settle the case expediently.  The Company
recognises that this has the advantage of releasing a significant amount of
management time and avoids the potential costs if any defence case were to
become protracted.



The initial settlement payable to Palmtop is for US$900,000.  Lo-Q is also
required to make additional annual payments for the years 2007, 2008 and 2009.
The company expects its resulting costs in meeting these three additional
payments to be in the region of $70,000 in each of these years.   After these
payments the Company will have fulfilled its requirements under the settlement.
The Board are confident that these exceptional costs can be absorbed by the cash
flows from the business from the current and following financial years.



The Company's normalised profit before tax for the year ended 31 December 2006
is expected to be in line with market expectations. However, with the inclusion
of both legal and settlement costs, which will be included as exceptional items
in this years accounts of approximately £600,000, the Company will report a loss
of approximately £0.3 million for the year ended 31 December 2006.



Enquiries:



Jeff McManus,                 Lo-Q Plc                 01491 577 210
John Prior, Romil Patel       Corporate Synergy Plc    0207 448 4400


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