Cubic Transportation Systems to Address Customers' Needs for ``Smarter'' Security.

Business Editors & High-Tech Writers

SAN DIEGO--(BUSINESS WIRE)--Oct. 25, 2001

Cubic Transportation Systems Inc., a subsidiary of San Diego-based Cubic Corp. (AMEX:CUB), has formed a new group to address its public transit customers' concerns about enhanced security.

The company believes its transit-based smart card ticketing -- already in use in Washington, D.C. and Chicago -- is a natural base for smart ID cards that incorporate fingerprint and facial recognition technology.

Cubic believes its proven smart card technology, used by more than more than 200,000 U.S. commuters, has the potential to be used in security markets ranging from public safety, airports, private and public buildings to public transit systems.

Cubic Transportation Systems has been the world's leading automated ticketing and revenue management integrator for more than 25 years and has smart card contracts for public transit systems in North America, Europe and Asia. Cubic's GO CARD(R) is the core technology for the SmarTrip(R), used by 200,000 Washington Metro commuters for rail, parking and soon buses, and the Chicago Transit Authority's SmartCard, in the hands of 3,000 commuters, a number expected to grow to 300,000 in a couple of years.

The new group, Cubic Security, will be headed by Cubic's Mark Gaertner. The group will accelerate smart card development underway before the terrorist attacks in New York and Washington, D.C. Since then, many of Cubic's existing customers have heightened concerns about upgrading their security measures.

"In reality, Cubic has been in the access control and security business for more than 25 years, moving people safely through transit faregates and into the transit system," Gaertner said. "With our expanded GO CARD(R) applications, we can now move people safely through buildings and airports as well."

GO CARD(R) is a contactless smart card with an embedded chip and antenna that communicate via radio frequency with special readers, also developed by Cubic, at the point of entry into transit faregates, ticket vending machines, parking systems, building doors and potentially airport boarding gates. At the point of entry, users touch their smart cards to a reader that scans the code. By incorporating biometrics into the system, in a fraction of a second, the reader can compare the facial, fingerprint or other biometric "images" of the cardholder to the image on the card.

Cubic is working with several potential partners in biometrics, a high-tech field which relies on statistical analysis of biological observations to help positively identify and authenticate personal characteristics. It includes technologies such as fingerprint analysis, hand geometry, voice pattern and face recognition, acoustic signature analysis, and retina and iris scanning to map individual physical characteristics and convert them into a digital file for storage on a smart card chip. By integrating its proven smart card technology and high-tech readers for information storage and systems integration expertise, Cubic can efficiently and reliably deliver the security system end-to-end.

"With simple, low-cost enhancements, our technology is easily transferable to non-transit security enforcement uses. Because we are well established in the world's largest transit systems as the electronic ticket system provider, our product is positioned to grow into the foundation for the most sophisticated security technology on the planet," Gaertner said. "In addition to offering added value to our existing customers, we can support non-transit entities whose employees use mass transit and want to be able to use one smart card for travel and employee ID. The opportunities and possibilities are endless, yet practical and feasible since so many people already rely on Cubic-developed smart card technology every day."

Cubic introduced the world's first transit smart card in 1989 when the London Underground sought a faster, more secure method for its riders to pay fares. Cubic created the GO CARD(R), a batteryless credit card-sized card that uses encryption/security technology to process financial transactions in approximately 70 milliseconds. According to Gaertner, that exceeds requirements (set prior to September 11) for airline ticketing use, which call for keeping the airline process safe without burdening travelers with long lines.

Praised for its high-speed transaction time that gets passengers on and off trains and buses quickly and safely, Cubic's GO CARD(R) is already used as an employee identification tool for some Cubic public transit customers. In those systems, GO CARD(R) verifies employee identity to allow access into machines with cash and coin vaults. The addition of biometrics would be the next logical enhancement.

"Our systems are examples of Cubic's ability to provide secure, real-time financial communications in just milliseconds, and every day we process and protect hundreds of millions of dollars of cash and credit transactions," Gaertner said. "This represents our ability to protect personal information for tens of millions of people worldwide."

Every year, nearly 10 billion people use Cubic systems in more than 40 major markets in five continents, including London, Washington, D.C., Hong Kong, Chicago, New York, Guangzhou and Shanghai, China, Atlanta, San Francisco, Singapore and Miami. As part of the TranSys consortium, Cubic also is supplying the entire automated fare collection system including smart cards for the London PRESTIGE project.

Cubic Transportation Systems Group is one of Cubic Corp.'s two major segments. The Cubic Defense Group provides battle command training, instrumented training systems, avionics, data links, product logistical support, and radio communication systems. For more information about Cubic, see the company's Web site at www.cubic.com.