BLS Block Shield

    Immediate Release: Tuesday 4 March 2008

                         Block Shield Corporation plc                          

                        (`Block Shield' or `the Group')                        

                                Trading Update                                 

Block Shield Corporation plc, the provider of innovative electronic components
and processes utilised in electromagnetic compatibility (`EMC') and Radio
Frequency Identification (`RFID') applications, provides the following trading
update in relation to the second half of the financial year ended 29 February
2008 (the `period').

The Group continued to expand both its EMC and RFID businesses and, as
previously stated, maintained its focus on its expansion into Asia with some
considerable success, particularly in the latter part of the period with the
sale of its newly developed high-volume RFID manufacturing module to its Asian
joint-venture partner. However, business in the United States disappointingly
developed at a slower pace than anticipated, primarily due to continuing delays
in the emergence of a mass RFID market. As a result, the Group expects to
report that revenues for the full year ended 29 February 2008 will be below
current market expectations. Whilst frustrating, these delays in the US are not
uncommon when dealing with potentially large but emerging technology markets
and the Group is pleased to report that it did experience a significant
increase in its RFID business following the completion of its newly developed
high-volume manufacturing module, named the Dedivol towards the end of the
period . As a result, the Group is pleased to report that its continued focus
on the more rapidly emerging Asian markets has resulted in a growing pipeline
of opportunities which it continues to pursue. Furthermore, the Board is
satisfied that it has adequate resources available to it to execute its
business plans.

The Group would regard the securing of several major military contracts for its
EMC division and its continuing successful expansion into Asia based RFID
markets, together with the completion of its mass manufacturing RFID antennae
machine, as the year's major achievements.

Highlights

EMC

  * Towards the end of the period and following a long period evaluation, the
    Group secured two multi-year EMC contracts with Microsun XX and EF Johnson
    XX- subcontractors to US government military programs - that were awarded,
    at least in part, due to the Group's proprietary solutions. These contracts
    are anticipated to ramp to full production within the fist half of the
    current year and will contribute several millions of dollars of recurring
    annual revenues to the Group.
   
  * Contracts were also received from major manufacturers such as Lexmark,
    Radiospire and Intel. These will be fulfilled by our dedicated facility in
    Shanghai, China.
   
  * Overall, EMC revenues experienced a decline in the period, owing to a
    slowdown in the US based medical devices market, which historically
    represented a significant portion of our US based EMC product revenues.
    Whilst all our major contracts remain in place, order flow from them
    decreased in the period. The newly secured contracts which will bolster our
    pipeline are significant, but have not yet had the required time to be
    ramped to sufficient volume to compensate for the decline in orders from
    embedded clients.
   
RFID

Towards the end of the period, the Group was delighted to complete the
significant technical acceptance, delivery and sale of its first high-volume
RFID manufacturing module, the `Dedivol'. This low-cost, high-volume
manufacturing solution is capable of producing in excess of 200 million
antennas annually. This achievement represents the completion of the
development of what the Board believes is the most cost effective mass
production process for the manufacture of complete RFID tags, which incorporate
both an antennae and micro-chip, available in the world today. The Group is
pleased to report that since the completion and availability of the Dedivol it
has received significant level of commercial interest in the machine from a
number of industry participants and existing customers.

  * It has for sometime been the belief of the Board that the future of
    high-volume, low-cost RFID manufacturing solutions would be in Asia. A
    recently published report by international RFID consulting firm, IDTechEx,
    has supported this view and forecasts the Asian RFID market to grow from
    US$5bn in 2007 to US$27.9bn by 2017. IDTechEx also revealed that China has
    become the world's largest market for RFID technology with US$1.9bn market
    value in 2007 alone. Accordingly, our major expansion and sales initiatives
    have continued to focus on Asia and we are pleased to note that these have
    been successful during the period.
   
ASIAN EXPANSION

  * The Group recently signed an exclusive distribution contract with the Basch
    Corporation in China, a leading distributor of manufacturing equipment to
    the printing industry and to the RFID industry. Basch Corporation is
    currently a major supplier of component pieces to a number of leading Asian
    based RFID system manufacturers and Board considers the distribution
    contract with them to be a significant channel to market for the Group's
    RFID products.
   
  * The Group also signed M.O.U.s with SinoStar in Taiwan and PolyPlas in
    Malaysia to establish further Asian based joint-venture partnerships
    similar that established with RFmon and will update the market when
    appropriate. Further to these developments, the Group is also in advanced
    negotiations with several other major electronics manufacturers to supply
    EMC solutions into the Asian market.
   
FINANCIALS

  * The Group's revenues, as forecast in our previous announcements, continue
    to be dominated by large sales of equipment and accordingly revenue
    performance in any particular period is heavily influenced by the timing of
    individual transactions and at times is not indicative of ongoing business
    development within the Group.
   
  * Notwithstanding the significant progress made by both the EMC and RFID
    Divisions this year, the Group expects to report that revenues for the full
    year ended 29 February 2008 will be below current market expectations.
   
OTHER

  * In addition to growing organically, the Group is committed to growth
    through acquisition. We continue to seek consolidation targets in both the
    RFID and EMC sectors and have identified several companies that we believe
    would be highly valuable complements to our core business. We will update
    the market on our progress in due course.
   
                                                                               
                                    -Ends-                                     

For further information contact:

Block Shield Corporation Plc +1 408 830 5100

Pier Antoniucci, Chief Executive Officer

Hansard Group 020 7245 1100

Andrew Tan

Ambrian Partners Limited 020 7776 6421

Tim Goodman



END

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