Cubic to Showcase Recent Innovations at Major U.S. Military Training Exhibition.

SAN DIEGO -- Cubic Defense Applications, the defense segment of Cubic Corporation (AMEX:CUB), will highlight its recent innovations in live training, virtual simulation and educational services this week at the I/ITSEC conference and trade show in Orlando, Fla. The annual Interservice/Industry Training, Simulation and Education Conference (I/ITSEC) is the largest and most important military training show in the United States.

Cubic, which continues to be the world's leading provider of live air and ground combat training systems, will demonstrate its solutions for on-demand training in today's complex battlefield environments. The company will showcase new technologies and services that ensure the highest level of readiness for joint, coalition and multi-service missions, with a major emphasis on urban warfare and exportable, homestation training capabilities.

"Our strategy is simple - never stand still. We have a long history of innovation and are constantly improving our training offerings to ensure they faithfully represent the operational environment and provide the most realistic training experiences," said Gerald Dinkel, president and CEO of Cubic Defense Applications Group.

"On a larger scale, we are focusing our efforts on providing solutions that facilitate interoperable training in joint and coalition environments and on technologies that enable seamless tracking of soldiers in urban environments," Dinkel said.

Cubic's theme at I/ITSEC is "First in Readiness," with an emphasis on the company's milestones and innovations through the decades, worldwide presence and market share in the industry. Recent milestones include:

LIVE TRAINING SYSTEMS

* I-HITS Delivery: The first delivery of the Army's Initial - Homestation Instrumentation Training System (I-HITS) - the world's most advanced deployable training system - to the Eighth U.S. Army at Camp Casey, Korea. I-HITS provides high-fidelity training capabilities, including battle tracking, data collection and after-action reviews, without the need for a fixed infrastructure. A completely self-contained package, I-HITS can be rapidly deployed to support force-on-force, force-on-target, joint and combined arms training. Cubic is delivering I-HITS to U.S. and allied forces under a five-year contract awarded in 2005 from the U.S. Army's PEO-STRI.

* P5 Combat Training System/Tactical Combat Training System (P5CTS/TCTS) Rollout: The rollout of the U.S. military's next-generation air combat training system, which is now operational and training aircrews at Naval Air Station Key West and Luke Air Force Base. The P5CTS/TCTS is an easily transportable "rangeless" system that allows instrumented joint and coalition air combat training without the use of fixed infrastructure. Cubic and its principal subcontractor, DRS Technologies, will deliver approximately 30 systems to the U.S. Air Force, Navy, Marine Corps and Air National Guard over the next seven years.

* MILES Engagement Simulation: The development of a new version of Cubic's widely used laser-based combat training system featuring wireless technology. The company's New Zealand subsidiary is providing the system to an Asia Pacific customer under a $25 million contract recently awarded. In the United States, Cubic is developing the U.S. Army's next-generation Individual Weapons System, or IWS, which features superior, accurate performance and smaller, lightweight components. The first sites to field MILES IWS are the National Training Center (NTC) at Fort Irwin, Calif., and Fort Bliss, Texas.

JOINT & COMBINED TRAINING

* JCTC Integration Efforts: A major effort, now underway in Australia, to integrate live training systems with virtual and constructive simulations, and also provide advanced urban operations training capability. Cubic is playing a key role in developing the Joint Combined Training Centre (JCTC), a U.S.-Australia effort to network several military training facilities in Australia for interoperable bilateral training. The JCTC effort aims at increasing operational capability, combat readiness and interoperability between the U.S. and Australia, and encourages integration of live, virtual and constructive (LVC) training technologies. JCTC is a project of the Australian Defence Force (ADF), the U.S. Pacific Command and U.S. Joint Forces Command.

VIRTUAL TRAINING

* EST 2000 and Enhancements: The ongoing success of Cubic's Engagement Skills Trainer (EST 2000), its Warrior Skills Training enhancements, simulated weapons and services. In the past year, Cubic's Simulation System Division has received more than $22 million in orders for the virtual training systems and services to the U.S. Army, Air Force and the Department of Energy. EST 2000 -the only small arms systems validated by the U.S. Army Infantry School, teaches marksmanship skills, squad-level collective defense, and judgmental "shoot-don't shoot" tactics. The Warrior Skills trainer, an enhancement to the EST 2000, provides convoy combat and offensive training in addition to standard small arms training.

MISSION SUPPORT SERVICES

* Enhanced Homestation Training (EHST) services: The recent success of Cubic's EHST efforts (also called Exportable Combat Training Capability, or XCTC by the National Guard), including an exercise in July involving more than 750 members of the Indiana National Guard. This new training concept allows Army National Guard and Army units to undergo highly realistic battlefield conditions and instrumented training at their home station, or at regional training sites. The training exercises resemble the training experiences that soldiers receive at major Army combat training centers such as Fort Polk, Louisiana.

TRAINING AND EDUCATION

Cubic's Training and Education Division, which developed the U.S. Army's Battle Command Knowledge System in 2004, today introduces new virtual video gaming techniques that it is inserting into Army simulations. Among its innovations, the company is incorporating technology from the commercial world and providing "best of class" solutions for the Army Force Generation Model, or ARFORGEN, according to John Lewis, director of Educational Programs. The division's new educational technology solutions include:

* Learning Collaboration System: Cubic's Training and Education Division is providing advanced learning technologies to enable a virtual collaborative learning environment. The Learning Collaboration System combines low-cost commercial off-the-shelf technology and software to enable commanders at homestations, and when deployed, meet their training and readiness requirements throughout the Army Force Generation cycle. The students have full access through a selected web-browser to view presentations in real time, and obtain lesson content, video, voice and graphic interactions with remote located instructors and subject matter experts.

* Games on Learning Engine: The commercial PC-based computer game potentially provides the ability to gain mastery levels of performance for cognitive and psychomotor tasks through multiple repetitions in a learning environment that is a "safe place" to fail. The missing link is having an automated instructional design system that provides quick assessments, near-real time retrieval and PC-based games.

* Digital Story Telling Services: Cubic's Digital Story Telling services apply advanced interactive media technologies with 3D animation and video to create powerful digital lessons and training support packages for commanders via the Army Force Generation Model. Digital story telling is a powerful and effective tool to rapidly improve upon new and emerging tactics, techniques and procedures that have been abstracted by experience to improve upon problem solving and decision making.

* Networked Decision Games and Decision Exercises: The Training and Education Division, in partnership with AVANT and Strategic Knowledge Solutions, has developed a low-cost solution for the design, development and implementation of effective Networked Decision Games and supporting tabletop Decision Exercises. They are specifically designed to support commanders and their teams throughout the execution of the Army's Force Generation Model to meet individual leader and collective training tasks pertaining to effective decision making and Battle Command.

The Cubic Defense Applications group, one of Cubic's two major segments, is a world leader in realistic combat training systems, mission support services and defense electronics. The corporation's other major segment, Cubic Transportation Systems, designs and manufactures automatic fare collection systems for public mass transit authorities. For more information about Cubic, see the company's website at www.cubic.com.