Oberthur Card Systems Reports 2006 Q1 Sales

Smart card company reports best Q1 sales yet

PARIS, April 26 /PRNewswire-FirstCall/ --

- Best Q1 Sales ever registered: EUR121.9 M, a 3.1% increase[1]

- Volumes of smart cards comparable to Q4: 56 M units vs 58 M units in Q4 2005

Oberthur Card Systems today reported first quarter 2006 revenue of EUR121.9 M, matching the record-breaking EUR118.1 M Q1 2005 sales and EUR121.1M Q2 2005 sales.

Sales MEUR 2006 2005 Variations 2006 / 2005 EUR at EUR at actual constant rates rates First Quarter 121.9 118.1 - 0.9 % +3.1%

In what is traditionally a slow period and in comparison with already record sales in the first quarter of 2005, the mobile and ID segments delivered growth with an unrivalled level of smart card shipments.

During the first three months of the year, Oberthur Card Systems has delivered 56 million microprocessor cards, a 29.4% increase year-on-year.

- In the Mobile segment, volumes reached a record level at 33.8 million units, showing a 70.7% growth compared to Q1 2005, essentially pushed by significant deliveries in North America, Middle-East and India, where the company has increased its market share substantially. Oberthur Card Systems has achieved a tremendous performance in emerging markets, which should migrate to high-end products in the near future.

As a consequence, the product mix has temporarily been modified due to the great increase of middle range card volumes. Oberthur Card Systems has once again confirmed its strong position in the high-end segment as more than 50% of SIM volumes are high-end cards, a 37% increase of high memory cards compared to Q1 2005. Stronger competition in the market combined with a modified product mix this quarter led to a 40% decrease in the average selling price. Sales in Mobile Communications continued to grow and amounted to EUR39.4M, a 2.7% increase at constant exchange rate compared to Q1 2005.

- Sales of payment cards amounted to EUR24.7 M, a 23.4% decrease at constant exchange rate compared to Q1 2005, with 16 million cards delivered vs. 19.6 million for the corresponding period last year. Oberthur Card Systems is satisfied with the sequential trend: the company delivered a remarkable and unusual performance this quarter as volumes remained stable. In addition to this, the average selling price showed a 3.6% increase compared to Q4 2005, due to an improved product mix in Europe and exchange effects in the United States. In the meantime, the contactless payment card segment continued to develop favourably in the first quarter with deliveries of several million units, driven by large-scale deployments in North America.

- Sales for Identity and Security segment reached EUR10.6 M, up 18.9% on a year-on-year basis. Volumes for the Identity and Security segment reached 5.9 million units, a 61.1% growth pushed by strong demand in the Pay TV sector and e-passport, Moroccan ID card deliveries. The ASP decrease was mainly attributable to the expected price pressure in the pay TV sector.

Sales in the Other Cards Segment - magnetic stripe cards, scratch cards and memory cards - amounted to EUR20.6 M, showing a 5.0% increase year-on-year. Magnetic stripe card volumes were stable in the United States while experiencing a strong growth in the MARS[2] region, mainly due to the acquisition of Africard (EUR1.4 M sales).

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