Press release on 2000 Financial Year

Press release on 2000 Financial Year · First licence agreement signed for self-identifying smart cards · Newly developed, extremely compact line sensor now in first prototype production Operations in general The Company is developing a technology for scanning and matching fingertip patterns for determination of individual identity, which can replace or supplement PIN codes and passwords in products and systems where user ID is essential. The Company sells licences for its technology developed in house and typical applications can be found in building access control, smart cards, mobile telephones and systems for e- commerce and other electronic transactions. Key events during the financial year · Operating income totalled KSEK 3,576 (1,142) and net financial items, KSEK 4,780 (934) · The loss for the year was KSEK 20,749 (17,194) · Available liquid funds including current investments amounted to KSEK 154,428 (26,128) · There were thirteen (four) employees. · The first licence agreement for self-identifying smart cards was signed · Newly developed, extremely compact line sensor underwent its first prototype production April saw both an issue of new preferential shares directed at Company shareholders and a new institutional issue. Together, they netted the Company MSEK 149. In conjunction with this, the B-shares were quoted on the O-list of the Stockholm Stock Exchange. During the year, application efforts were commenced with a number of interesting partners. Consequently, a project started with Litronic Inc. for joint development of a smart-card based solution for e-commerce with PKI and biometric security. A further interesting application effort that was initiated in 2000, is the integration of Company technology into a handheld computer, i.e., what is termed a PDA. Towards the end of the year, two new licence agreements were signed. Special interest is attached to the one with Biometric Associates Inc., which is a licence for a smart card, where the entire Fingerprint finger verification system is to be integrated into the card itself. This application comprises the self-identifying smart card, which can be used as a credit card, a certificate for e-commerce and Internet banking or a general ID card, and coincides with the original technological development goal of the Company. In this particular application, technical problems still remain to be solved. The main issues are the physical flexibility of the smart card and the power consumption. The Company does not expect any high volume deliveries during 2001. R&D operations During the year, a further sensor variant was developed, i.e., a line sensor which scans the finger pattern when the finger is drawn over a small sensor area measuring only 2.5 x 11 mm. Its small size drastically cuts production costs. A special surface layer for the sensors has been developed, which makes them resistant to wear and mechanical damage as well as electrostatic discharge. Refinement of Company algorithms have resulted in the creation of an identification algorithm, intended primarily for application in cardless building access control systems and capable of handling up to 1,000 stored reference patterns. Furthermore, work started on the design of a second generation of ASIC processors that, among other benefits, will radically cut system current consumption. These new processors are to be combined with both the surface and line sensors. The reinforced engineering resources together with the new tools developed to facilitate more specific future system developments, have considerably enhanced the efficiency of technological operations. As a result, the Company now purchases only extremely specialised external services, e.g., for its chip design. During the year technological development cost amounted to KSEK 14,000, all of which has been written off. Expectations of future developments As market attention switches from an evaluation of customer acceptance to more fundamental integration issues, the more profound difference between competing biometric technology approaches will become completely visible. The market will increasingly demand technology at a lower cost, for smaller size components and better current-conserving systems. Continuous development efforts by Fingerprint Cards have prepared the Company for both a greater demand for efficient integrated solutions and stronger interest in further platforms with integrated systems, from smart cards to other small, personal units. In the coming years the Company expects that its dynamic approach will prove decisive, when the producers of volume products, which are to be secured biometrically, come to choose their partners. Significant events after the expiry of the financial year At the beginning of January 2001, corporate technology was demonstrated by the Volvo Car Corporation AB at the Detroit Motor Show in the USA. In collaboration with Fingerprint Cards and Combitech Systems, Volvo has developed a new, intelligent remote control, the, "Volvo Personal Communicator" (VPC), which is part of its "Safety Concept Car". User identity is secured through finger verification and the remote control stores information and communicates it through the application of "Bluetooth" technology. Financial position Operations are essentially financed by an MSEK 55.5 issue of new shares, floated in spring 1998, and also a preferential and a directed new share issue worth MSEK 149 net, floated in April 2000. The Group equity/assets ratio was 96.3%. Consolidated available liquid funds, including current investments, stood on December 31, 2000, at MSEK 154.4. Current receivables amounted to MSEK 4,6. Fixed assets, investments and depreciation During the year, MSEK 1.3 was invested in equipment. Earlier investment costs set up as an asset, a total of MSEK 9.2, are depreciated according to plan by 20% annually. Patent rights are depreciated by 15% annually and personal computers by 30% annually. Personnel At year-end, there were thirteen employees (four), while a further ten persons were external contractors. Dividend The Board does not propose any dividend for the financial year. Annual Report and AGM The 2000 Annual Report will by published in April and will be available at the Company offices, with effect from April 22, 2001. The AGM is planned for Tuesday, May 22, 2001 at 17:00, in Göteborg, Sweden. Other reporting dates First quarter interim report January-March, May 22, 2001 Half-yearly interim report January-June, August 28, 2001 Third-quarter interim report January-September, October 23, 2001 Göteborg, Sweden February 20, 2001 Fingerprint Cards AB (publ) The Board For further details, please contact Company President Lennart Carlson tel. +46 31-60 78 20 Fingerprint Cards AB, Box 2412, SE 403 16 Göteborg, Sweden. www.fingerprint.se investrel@fingerprint.se ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2001/02/20/20010220BIT00790/bit0002.doc Full year-end report http://www.bit.se/bitonline/2001/02/20/20010220BIT00790/bit0002.pdf Full year-end report