NEXT Biometrics Group ASA — Share Issue/Capital Change 2016

Apr 26, 2016

NEXT Biometrics Group ASA - Smart Card sensor launch, First order & Trading Update

NEXT Biometrics Group ASA - Smart Card sensor launch, First order & Trading Update

NEXT BIOMETRICS SHOWCASES ITS FIRST FULLY FLEXIBLE FINGERPRINT SENSOR FOR SMART

CARDS

In a launch to be held at DnB-TV today at 08:30, NEXT Biometrics CEO Tore Etholm

Idsøe shows the world's first smart card compatible flexible fingerprint sensor.

(link to presentation will be published at www.nextbiometrics.com )

" We have previously announced that we will not comment further on our smart

card developments until we have something material to prove", Etholm Idsøe

stated.  " We are now proud to announce that our ISO-compliance includes the

recently published ISO/IEC 17839 standard, and to our knowledge this makes us

the only supplier to meet this specification.

We have always believed that the Active Thermal principle, patented by NEXT, is

optimally positioned to produce a flexible sensor, which has the required size

to be secure and convenient for almost 100 per cent of the population.

Etholm Idsøe emphasized, we are now in the process of setting up production

lines capable of delivering tens of millions of sensors at an acceptable yield.

This includes some risk and is targeted to be completed in H1-2017.

The card industry is showing a strong interest in working with NEXT, and this

market will be our main focus in the upcoming quarters.

NEXT RECEIVES FIRST SMART CARD INDUSTRY MASS PRODUCTION ORDER FOR FINGERPRINT

SENSORS

NEXT Biometrics ASA has received the industry's first biometric smart card

volume order. The initial order has a value of NOK 12 million and shipments are

scheduled to start in Q3 2016. The first shipments will consist of rigid

sensors.

Volumes to our undisclosed customer are expected to increase to a total of

650 000 units in  2017.

The on-going development with our customer is aiming to ship a mass-produced,

fully flexible and ISO-compliant biometric smartcard that will meet all

requirements in this segment during 2017.  This collaboration is aiming at

introducing biometrics into ISO standard smart cards - a market that currently

is estimated to grow to several hundreds of millions units per annum.

NEXT CEO Tore Etholm-Idsøe says: "Our (undisclosed) customer has done an

impressive job in bringing out this product, as the first of its kind, and they

have a high profile end customer waiting to take contracted deliveries. We are

very proud to say this is the world´s first mass production order for

fingerprint sensors on smart cards.

For NEXT this is an important milestone as it demonstrates our leading position

within the smart card market. As far as we know, no other company has yet

managed to meet all mandatory ISO standard requirements. NEXT and a growing

number of key industry players now seems to agree that NEXT technology is

uniquely positioned for success in the smart card space.   Being able to meet

both the ISO and the real life mass market minimum requirements of sensor size

is recognized as key to success in the quality critical smart card applications.

The Active Thermal Principle, patented by NEXT is perfectly suited for producing

a flexible sensor with the size required for the solution to be secure and

convenient for close to 100 per cent of a population, - and at an affordable

price."

TRADING UPDATE Q1-2016  -  OPERATIONAL HIGHLIGHTS.

- Ramp up of Notebook market volumes

- Sales of NOK 5.2 million

- Key smart card technical milestones met

- Significant strategic smart card customer progress

Cash and cash equivalents amounted to NOK 76.2 million by the end of Q1 2016

compared to NOK 130.2 million by the end of Q4 2015. The majority of the

increased negative cash-flow compared to previous quarters is related to high

production costs during mass production ramp up, increased working capital and

investments in smart card activities

The operations, including investments, consumed cash in an amount of NOK 54

million in the first quarter of 2016 compared to NOK 44.2 million in the

previous quarter and NOK 30.5 in the first quarter of 2015. Revenues of NOK 5.2

millions in Q1 2016 compared to NOK 1.7 in Q4 2015, and NOK 2.4 million in Q1

-2015.

The Company will announce its quarterly report for Q1 2016 on 24 May 2016.

ABOUT NEXT BIOMETRICS: Enabled by its patented NEXT Active Thermal principle,

NEXT Biometrics (www.NextBiometrics.com) offers high quality area fingerprint

sensors at a fraction of the prices of comparable competitors. A wide range of

product formats including Smartphones, Tablets, PC's, Doors, Time registration

systems, Wearables, Payment terminals, Flashdrives, USB-tokens, Key fobs and

many more are targeted. NEXT BIOMETRICS GROUP ASA is a publicly listed company

headquartered in Oslo, Norway and with sales, support and development

subsidiaries in Seattle, Silicon Valley, Taipei, Prague and Shanghai.

Media and Investor contacts for NEXT Biometrics:

Tore Etholm Idsøe, CEO, Tore.Idsoe@NEXTbiometrics.com and

Knut Stalen, CFO, Knut.Stalen@NEXTbiometrics.com