Final Results

RNS Number:8160E
ID Data Group PLC
28 September 2007

                                               28 September 2007

                               ID Data Group plc
                          ("ID Data" or "the Company")


Preliminary Results for the year ended 31 March 2007

ID Data Group Plc (AIM:IDD), the smart card solutions and outsourcing business,
today reports its preliminary results for the year ended 31 March 2007.

Key points

*  Turnover of #8.1 million (FY 2006: #12.1 million)
*  Loss before taxation #4.8 million (FY 2006: #3.8 million loss)
*  Acquisition of credEcard in May 2007
*  Successful participation in the MasterCard(R) UK launch of PayPass(R)
*  Polish joint venture, Artis ID, trading profitably
*  Currently fundraising to cover ongoing operations and recent acquisitions

Commenting on the results, Peter Cox, Chief Executive of ID Data Group plc,
said:

"This financial year has seen ID Data continue its transition from a fixed cost
card manufacturer into a variable cost solutions provider. The implementation
our new "fresh thinking" corporate values have aided the Group to move up the
value chain. We have focused on maintaining our margins and as such have turned
away unprofitable business. I am pleased to report that clients are now
returning on more acceptable terms to the card business and we currently have a
large number of bids in process for smart card projects.

"ID Data's reputation has been enhanced through our participation in the UK
launch of MasterCard's(R) PayPass(R) solution, the Tap and Go prepaid card
technology for small value purchases. The recent acquisition of credEcard places
the Group in a development position to benefit from the forecast strong growth
in the prepaid financial services sector. "

The Preliminary Results statement and the Annual Report and Accounts for the
year ended 31 March 2007 will be available on the Company's website at http://
www.iddata.com and hard copies will be sent to all shareholders.

For further information, please contact:

ID Data Group plc
Peter Cox, Chief Executive                           Tel: [phone]

Smith & Williamson Corporate Finance Limited
Azhic Basirov / David Jones                          Tel: [phone]

Media Enquiries
Abchurch
Chris Lane / Georgina Bonham                         Tel: [phone]
[e-mail]



Background

ID Data is a leading independent, quoted provider of card based solutions which 
is now in the process of transforming its business into higher value added 
services around the smart card including its entry into financial services.

Formed in 1988, the Company has built an impressive customer base by using its 
expertise to offer a wide range of technological and commercial solutions to 
leading organisations in the retail, government, leisure and financial sectors. 
The Company adopts a detailed and consultative approach to its customers' needs, 
working through from understanding the sector, to product development and 
solution design, to database management and fulfilment and now has entered the 
financial services market as a provider of end to end prepaid card solutions 
with web based client financial account management using credEcard branded or 
white labelled MasterCard(R) cards.

ID Data continues to develop magnetic stripe, smart card and radio frequency 
identification (RFID) contactless solutions, whilst also developing the rapidly 
growing gift card and prepaid card sectors, 

The acquisition of credEcard in May 2007 enables ID Data to offer not only the 
products but a complete financial services solution to consumers and corporates. 
In September 2007 we announced the delivery of Tap & Go prepaid contactless 
payment cards for the MasterCard(R) UK launch of PayPass(R), the MasterCard(R) 
contactless payment technology putting ID Data at the forefront of this new and 
exciting payment card technology.

We continue to create market leading solutions for the retail loyalty, 
government and retail banking sectors through consistent research into market 
needs and future requirements.

Overview of Group activities

credEcard plc

Acquired in May 2007, credEcard is a financial services company providing 
prepaid payment solutions to consumers for daily household payments, money 
transfer, payroll, gaming and a wide range of other payment needs.

This acquisition is the first step in ID Data's developing strategy in looking 
for value added businesses where we not only provide the technology, but also 
enjoy the financial benefits of following the card into the real world of money 
transfer and account management.

credEcard is developing a comprehensive variety of payment solutions and 
products to both businesses and individuals using MasterCard's Maestro  card 
platform which can be used by cardholders to handle their daily financial 
affairs including purchases in shops, and ATM withdrawals.  Part of our client 
proposition is the provision of web based financial services including on-line 
bill payment.  Customers can also receive immediate SMS text alerts covering all 
account activity so they are fully in control of their card account activity and 
balances.  

Unlike normal bank accounts, the use of a credEcard is not dependent on credit 
checks, thus providing a solution to those who do not have a bank account or are 
unhappy with the current available banking services.

credEcard's target clients include under 18s, students, immigrant workers and 
those with no bank account or credit status.  Managed schemes offered by 
credEcard cover payroll payments, benefits, internet purchases and cash 
collection services for mail order and holiday companies.

credEcard has a collaboration agreement with Newcastle Building Society which 
is our MasterCard(R) sponsor.

In a recent report by MasterCard(R) and The Boston Consulting Group, the prepaid 
market in Europe is expected to reach 360 million card holders by 2010 with 
billions of pounds being transacted and on deposit.

ID Data's entry into this growth area will expand our product and service 
offering.

ID Data Ltd

ID Data Ltd, our original business, has developed over the years into being a 
specialist provider of leading-edge smart card solutions.

In recent years ID Data has moved from being a mass retail card solutions 
company to an innovative leader for smart card solutions, focused on the 
banking, retail, leisure and government sectors.

Essential Security

ID Data customers demand the highest levels of security and our facilities meet 
international standards for manufacturing, personalisation and issuance of both 
bank and other secure cards.  ID Data's UK facility in Petersfield has been 
awarded full MasterCard(R) and Visa(R) accreditation (EMV). In addition it is 
approved for secure production and processing for various government 
departments.

Banking

ID Data provides EMV specification chip card solutions including the latest 
RFID touch and go technology.  We have the in-house development, production, 
personalisation and security skills to compete on a global basis where the 
client requires a competitive edge to their debit or credit card programmes.

To enhance our banking offer, we provide a number of important technical 
solutions, including Spankey, a crypto-key generation solution, and Magtek's 
new instant issue solutions which, when linked to our CardBASE technology, 
offers in store or branch issue of secure financial cards that can even carry 
a photo.  

Spankey is a world beating, high performance software solution providing 
mission critical crypto key generation and management services for EMV and other 
secure card issuance.  A number of major institutions are using Spankey as their 
core cryptographic platform to manage the issuance of their smart cards.  

Magtek is a new development for instant issuance of cards at the point of sale, 
complete card personalisation and encoding of credit, debit, ATM and gift cards 
to the consumer. The process takes just 90 seconds and allows the customer to 
receive their card immediately following credit approval, which is all done 
online.

Government and Identity Cards

Governments continue to make increased use of smart card and chip technology in 
identity cards, passports and permission-based secure computer and other access 
applications.

Having diversified into the ID and government sector, ID Data has successfully 
won projects for the UK Post Office, benefit payments and with Bracknell Forest, 
the lead local authority for the UK government's National Smart Card project.  
ID Data has also been selected to deliver sophisticated new ID cards for the 
National Union of Students (NUS).  

ID Data is well placed to take advantage of this growing and exciting market, 
as it develops both in Europe and in other international markets following 
contract wins for E111 health cards for various European states.

Retail 

ID Data has always been a leader in delivering retail solutions for loyalty, 
gift and other applications for Europe's leading brands.

Our track record is recognised as a truly secure delivery platform for the 
launch and maintenance of mission critical retail programmes, with 17 years of 
successfully delivering appropriate solutions to Tesco, Nectar, Boots, Ikea and 
many other global brands.

As retail makes the move from the magnetic card to more sophisticated solutions, 
ID Data is assisting the major organisations to move to contactless RFID cards 
and the latest innovations in touch and go payments and data collection.

Leisure

ID Data is a leader in the provision of solutions and cards for the world's 
leading hotel and resort brands and the delivery of membership solutions for the 
fast growing fitness and recreational sector.  ID Data has introduced smart card 
applications which not only grant access but also control payment, loyalty and 
health records on a single card.

Artis ID, Poland

ID Data has a 44.6% stake in this Polish joint venture based in Bydgoszcz that 
manufactures card bodies for ID Data and Argo Card, a Polish card 
personalisation company.

Artis ID is a magnetic card producer and is delivering up to 11 million cards a 
month currently. Artis ID's production can be expanded to 500 million cards per 
annum with very little additional investment.

CardBASE Technologies Ltd

CardBASE Technologies is a leading developer of multi application smart card 
management software for the government, healthcare, banking and corporate ID 
markets. Based in Dublin, Ireland, CardBASE combines world-class software 
development expertise with knowledge and experience of security and payments 
solutions based on multi application smart card technology. 

Multiple application smart cards are continuing to increase as more and more 
organisations recognise the value of delivering various services through a 
single card. The move towards smart card technology requires powerful smart card 
management solutions. CardBASE has a proven and recognised solution Mascot(R), to 
support the secure delivery of information through a wide range of applications.
It recently installed the Polish tachograph programme.

CardBASE smart card management solutions enable card issuing organisations to 
not only manage all aspects of their smart card programmes but also empowers 
them to create and remotely install new applications on cards in daily use, so 
providing increased control and flexibility to card issuers.

CardBASE's Mascot(R) technology is not limited to cards but also can be used in 
the issuance and control of the new style contactless e-passports now being 
issued around the world. 

Digital Locksmiths Ltd

The company's principal activity is to provide consultancy, technical support 
and development services for smart card related projects. To meet these aims, 
Digital Locksmiths draws on over 25 years of smart card experience on the part 
of the founders. 

The company is expert in the development of chip card masks, programming and 
secure protection of smart cards, security modules and terminals. 

Digital Locksmiths will partner ID Data and others in the delivery of smart card 
solutions in the secure, transactional and transport sectors.

Civil ID, India

ID Data has acquired a 33.6% stake in this Indian venture based in Mumbai that 
offers card solutions to the corporate, government and banking sectors in India.

This investment is positioned to take ID Data into a market of one billion 
people whose government is intent on using smart cards as a way to increase the 
financial security of its population.


Chairman's Statement

This has been a year of change in direction and preparation for a more value
added business going forward following recent acquisitions and investments in
financial services and software businesses.

The financial year covered by this report was very challenging for all the
businesses then in the Group, especially the core card business where, as stated
in the interim report and accounts, there has been a fiercely competitive
environment, in which your Company declined business unless acceptable margins
were available. This strategy was one which we believed was appropriate, but
would delay the move into profitability. Our approach has resulted in clients
returning to our card business on acceptable terms and stating that ID Data's
total customer proposition is worth the premium it charges over the competition.

The year under review was always envisaged as a period of change for the Group.
Against falling revenues, the net results were similar to those of the previous
year, demonstrating the effect of turning away low margin business and the
impact of the ongoing reduction in our fixed overheads.

CardBASE losses mask the progress made in the card business as the Chief
Executive explains in his review.

The indications for the current financial year are more encouraging particularly
for the core ID Data Ltd business. Revenues are recovering albeit slowly, but
our stance on margins and fixed costs is showing positive effects.

Smart card product developments, and ID Data's future focus, in the exciting
areas of prepaid and contactless cards, are of particular importance. Our
involvement in the MasterCard(R) UK launch of PayPass(R) the Tap and Go prepaid
card technology for small value purchases, and our ability to deliver a working
solution in short time scales, is evidence of our expertise. RFID is expected to
be a core component of many payment solutions in banking and transport in the
future. ID Data has gained global recognition in this important technology.

Commenting on the launch, MasterCard's General Manager for UK and Nordics, John
Bushby, said "in the UK alone, there are currently in excess of 20 billion
payments under #10, with a value of approximately #200 billion a year. We
believe that MasterCard(R) PayPass(R) is the faster, and more convenient way to
pay for small purchases under #10. The project team at MasterCard(R) have been
impressed by ID Data's speed to market capability given the technical
development work required".

The year also saw the implementation of our "Fresh Thinking" strategy which
focuses on moving up the value chain. We recognised that the basic card business
was always going to be demanding, price competitive and resource hungry. So our
strategy has been to seek ways to use our excellent client relationships and
knowledge to build solutions or business offerings that would drive our earnings
in a more sustainable and predictable fashion.

The decision to enter the financial services sector by launching our own prepaid
debit card business for the consumer market was one such major change in our
direction. The acquisition of credEcard was completed in May 2007.

credEcard is a financial services company which had completed its R&D stage of
developing and proving its own prepaid debit card platform. It is now poised to
take advantage of the anticipated market opportunities for an alternative
payments solution to conventional banking using the MasterCard(R) backbone.
credEcard issues its own and white labelled cards, carries the funds on these
cards and manages all the transactions and reporting requirements of card users
through a sophisticated web based financial platform. It offers many of the
features found in internet banking but with the ability to use the debit card
for everyday purchases and cash withdrawals from ATMs globally.

Prepaid debit is still embryonic in Europe. There are probably less than a
million active cards today, but research indicates that there could be 360
million by 2010.

As to the long awaited UK ID card project, we firmly believe that we have the
technology and security required to satisfy any of the anticipated
specifications. We are working to establish as many contacts in the systems
integration and supply chain sectors to ensure that we are well placed for this
potentially major project.

There have been no changes to the Board during the year or to their
remuneration. To incentivise the executive directors and senior management to
deliver improved performance, shareholders are being invited to approve a
special resolution to reset the existing share option exercise price from 2.0p
to 1.0p. Options will not vest unless the group delivers profit after tax.

Your board believes that its new business lines and continued focus on driving
down costs will combine to produce a leaner more competitive Group in the
future.


JM Blackburn
Chairman

Chief Executive's Review

This 'changing' year has seen us move from being a UK based high fixed cost card
manufacturer to a largely variable cost based solutions provider with a wider
range of products and services. Consequently, we are now in a position to
deliver more revenue, more value added services and generate licensing revenues
allied to returns over the coming years from our move into financial services
with the acquisition of credEcard.

In the year to 31 March 2007, ID Data's sales were #8.1 million against #12.1
million in 2006 with pre tax losses at #4.8 million against #3.8 million.

As anticipated in the interim report, this loss was in line with our
expectations other than the negative contribution of #0.9 million from CardBASE,
our software company, which failed to deliver any significant new contract
revenues in the year. CardBASE sells licences which is a low volume, high margin
activity with unpredictable timeframes. Removing this impact, the significant
reduction in our cost base has delivered similar losses on significantly reduced
sales for the year.

This review must be examined in two segments to understand the dynamics of the
Group's strategy.

The first is the business progress and contribution from the historic business
units of ID Data Ltd, the card services business, and CardBASE Technologies Ltd,
our Irish software business. The second is credEcard.

ID Data Ltd

ID Data Ltd has made progress in a market where competitors' margins have
reduced in the year and stiff competition has resulted in many offers of
business which we have declined due to their poor margin contribution. This,
added to a climate of aggressive procurement by some of our traditional clients,
resulted in lower sales for the year. But I am now heartened that our stand
against doing business at low margins has resulted in most of our lost clients
returning and being prepared to pay our prices.

This tough approach took its toll on last year's results, but, as demonstrated
below, we have now reduced our fixed and variable costs in the card business
through efficiency in the UK and the utilisation of our joint venture Polish
facility. We have achieved the lowest breakeven turnover threshold in the
history of our time as a quoted company and which will reduce further in the
current year.

Extracts of results from Management accounts:

Year ending 31 March                               2005       2006       2007
# million

Sales                                              18.5       10.9        7.7

GP after materials, and JV transfer pricing          57%        61%        53%
from Jan 2006
Overheads                                          11.7        7.8        6.2

Loss before tax                                     4.1        3.5        3.8

Breakeven                                          25.7       16.7       14.8
Revenue level

The revenue line for the card business was also impacted by three events: the
news of our market fund raising was used by competitors to unsettle potential
clients; the rescheduling of some major contracts into the current year due to
client budgetary constraints; and the deliberate rejection of business not
meeting our margin requirements.

I am pleased to confirm that the current position for the Company is more
encouraging with some interesting deals coming our way and the acknowledgement
by many of our clients that our pricing is acceptable when taking into account
their own costs of trying to manage a less service orientated supplier.

The card business has won significant new work in the current year in the retail
and banking sectors and has a large number of bids in process for smart card
projects which will, if successful, positively impact on our overall earnings.

The key to our future now is very much about revenue. Tim Cronin joined us in
October 2006 as our Sales and Marketing Director for the core business. Tim was
the Managing Director of Orga Card Systems. We have reviewed our sales and
marketing capabilities and are now embarked on a strategy to provide sales
coverage across our intended markets in Europe.

The Polish joint venture, Artis ID has given us the significant and expected
decrease in product costs. The transfer of manufacturing to Eastern Europe gives
us a competitive pricing advantage in our chosen markets of Europe, Middle East
and Africa (EMEA). The Polish joint venture trades profitably.

The impact of our restructuring and the relocation of labour intensive
production to Poland has enabled your Company to manage the current market
conditions and limit the adverse impact on our bottom line by holding margins.

CardBASE Technologies Ltd

CardBASE is our multi application smart card software company. It has an
excellent range of products and solutions but is dependent on selling large
licence deals of between Euro500,000 and Euro1 million to government and other major
card issuers.

Unfortunately in the year ended 31 March 2007 we did not obtain any major
contracts for the business which traditionally have a long period of gestation.
This is a high margin business so the impact of top line sales is dramatic as it
is with most software companies.

We remain convinced that this business has a very interesting future as ID and
e-passport opportunities develop. It has managed to develop good working
relationships with systems integrators and it is hoped that during the current
year we will see a change in its fortunes.

To conclude on the core businesses, it is fair to say we have weathered a storm,
but now feel confident we have a structure that will generate profits as long as
the required sales are achieved.

"Fresh Thinking"

In last year's report and accounts we referred to the need for "Fresh Thinking"
and launched our new corporate values.

This approach has driven our desire to position the Group at the leading edge of
technology, but more importantly to review all of our business activities to
find better revenue models to deliver sustainable sales and profits going
forward.

There has to be recognition that the basic card solutions business is a tough
environment to be in and that we must look for new ways to use our considerable
knowledge, relationships and credibility to build a better business model.

It is through this process of evaluation that we have made the decision to
diversify our activities into the area of financial services.

Our acquisition of credEcard is yet to be fully understood by the market, so I
would like to explain the significance of this change in direction.

credEcard

credEcard is not a software business, but is a full financial services offering
to consumers who either do not have a bank account or wish for an alternative.

What we have with this investment is the opportunity to offer a full money
account management solution where we, using the Visa(R) or MasterCard(R)
networks, hold and manage consumers' cash and account management requirements
through a card account.

This card account is run using dedicated software which we own, that offers web
transactions, text alerts to card holders of every transaction and manages the
income we receive from processing the transactions be they ATM cash payouts or
general purchases on the card at retailers or on the internet.

Our revenues come from the supply of the card, deposit interest on funds managed
by us and the transaction fees similar to the model used by credit and debit
card companies around the globe.

So this is a very interesting venture for your Group. Our historic skills allow
us to offer the card, its distribution and now a full range of financial
solutions for consumers and businesses alike.

Prospects

ID Data is well advanced through its transition. The past year has seen reduced
turnover, but management has delivered significant changes to the historically
high cost base. The business is now positioned to achieve profitability at a
significantly lower sales level.

As the business model develops, it is expected that dependence on sales of
physical card products will reduce as income from licensing and financial
services transactional revenues increase.

The board continues to strenuously pursue opportunities to reduce costs and
improve competitiveness. Through "Fresh Thinking" we continue to evaluate new
acquisitions that will enhance our chances of significant shareholder returns.

Following the acquisition of credEcard, we require additional funds to enable us
to sustain and expand the Group businesses and gain a strong market share. We
are in discussions with our current and potential new investors to raise
approximately #2m in new equity. The current volatility in the equity and credit
markets has slowed this process but your board believe that it will be supported
in its needs.

The potential UK ID card, new RFID applications, and expanding European prepaid
and gift and health cards are exciting new opportunities for ID Data.

The move into financial services will have a negative impact on earnings in the
first half of 2007/8 but should enhance future results if the anticipated market
penetration is achieved.

Peter J Cox
Chief Executive

The Directors present their report on ID Data Group Plc ('the Company') together 
with the audited consolidated Financial Statements and Independent Auditors' 
Report for the year ended 31 March 2007.

Principal Activity

The Group's principal activity is the provision of secure card based transaction 
systems and services to the global retail, government, and bank/financial 
markets, using a range of smart and magnetic card solutions.

The Company's principal activity is that of a holding company.

Business Review

The Group's results for the year are set out in the Consolidated Profit and Loss 
Account in the Financial Statements.

A review of the business and future prospects is contained in the Chairman's 
Statement and the Chief Executive's Review. The management and board monitor the
results of the individual entities results. The performance of the Group is 
reported monthly and compared to forecast and prior periods. Key performance 
indicators are sales and volumes, sales prospects, gross profit, and level of 
overheads, including headcount. Key risks include market demand and competitive 
pressure on pricing.

The Directors do not recommend the payment of a dividend for the year.

Future Development

The Company is seeking to explore further opportunities in related intellectual 
property areas.

Research and Development

The Company continues to devote effort and resources to the research and 
development of new processes and products.  All research and development costs 
are written off in the year in which they are incurred.

Post Balance Sheet Events

The Company purchased the business and assets and name of credEcard in May 2007 
and issued 25 million shares at par to the vendors.

The Company purchased 50% of the ordinary share capital of Digital Locksmiths 
Limited in July 2007 for #15,000.

The Group is purchasing the remaining shares in TTi from Toshiba and Toppan and 
agreements have been signed.

Directors and their Interests

The Directors who held office during the year were as follows:

Jeffrey Michael Blackburn         Non-Executive Chairman 
Peter John Cox                    Chief Executive  
John Stephen Mitchell             Finance Director 
Julian Wheatland                  Non-Executive Director

Details of Directors' service agreements and share options are given in the 
Remuneration Report.  

The Directors' interests in the ordinary shares of the Company, together with 
details of shares acquired since 31 March 2007, all of which were beneficial, 
were as follows:

                                     12 Sept 2007          31 March 2007        31 March 2006
                                 Number of Shares       Number of Shares     Number of Shares

Jeffrey Michael Blackburn               1,830,350              1,830,350            1,830,350
Peter John Cox                        132,355,513            132,355,513          119,355,513
John Stephen Mitchell                   6,000,000              6,000,000            6,000,000
Julian Wheatland                                -                      -                    -

Substantial Shareholdings

The Company has been notified of the following interests of more than 3% in the 
issued ordinary share capital of 1,323,903,782 shares of the Company at 
12 September 2007.
                                               Number of        % of Issued                                             
                                                  Shares      Share Capital

RAB Capital                                   170,875,000            12.9%
Peter Cox                                     132,355,513            10.0%
Herald Investment Trust                       117,500,000             8.9%
Even Flow Holdings Limited                     96,965,000             7.3%
Singer & Friedlander AIM 3 VCT                 80,123,625             6.1%
Cornelian Enterprise Venture Trust 'A'         52,149,524             3.9%
Artemis AIM VCT                                51,978,021             3.9%
Wheddon Limited                                50,000,000             3.8%
Framlington Extra Income Trust                 50,000,000             3.8%
                                              -----------             ------
                                              801,946,683             60.6%
                                              -----------             ------
Charitable Contributions

During the year to 31 March 2007 the Group made charitable donations of #nil 
(2006: #20,000).  The Group made no political donations.

Employees

ID Data is an equal opportunities employer.  Applications for employment are 
always fully considered irrespective of gender, ethnic origin, race, religion 
or sexual orientation.  It is also the Group's policy to give full and fair 
consideration to the employment of applicants who are disabled, bearing in 
mind the aptitude and abilities of each person in relation to the requirements 
of the job.

The Group operates a communications policy that aims to integrate staff into the 
business and to encourage a sense of involvement.  This is achieved through 
formal and informal meetings, dissemination of written communications directly 
or via notice boards and the Group's web site. Technical and personal skills 
development courses are available to staff at all levels. 

Environmental Matters

The Group aims to protect and preserve the environment and is committed to 
energy efficient operations.  Wherever possible, waste materials are recycled 
and re-used. Paper and cardboard waste is separated for recycling and all 
plastic waste from card manufacture is reused in further plastic moulded 
products.

Disclosure of Information 

So far as each of the Directors are aware, there is no information needed by 
the Company's auditors in connection with preparing their report of which they 
are unaware, and the Directors have taken all the steps that they ought to have 
taken as Directors in order to make themselves aware of any relevant audit 
information and to establish that the Company's auditors are aware of that 
information.

Financial Instruments 

The Company's financial risk management objective is broadly to seek to make 
neither profit nor loss from exposure to currency or interest rate risks. Its 
policy is to finance working capital through retained earnings and through 
borrowings at prevailing market interest rates. Its policy is to finance fixed 
assets through fixed rate borrowings for a term broadly expected to match the 
useful economic lives of the assets.

The Company's exposure to the price risk of financial instruments is therefore 
minimal. As the counterparty to all financial instruments is its bankers, it is 
also exposed to minimal credit and liquidity risks in respect of these 
instruments. Its cash flow risk in respect of currency purchases is also minimal 
as it aims to pay its main supplier Artis ID in accordance with its stated 
terms.

The Directors do not consider any other risks attaching to the use of financial 
instruments to be material to an assessment of its financial position or profit.

Creditors' Payment Policy

The Group's policy for all suppliers is to fix terms of payment when agreeing 
the terms of each business transaction to ensure the supplier is aware of those 
terms and to abide by the agreed terms of payment.  The trade creditor payment 
days outstanding for the Group at 31 March 2007 was 63 days (2006: 60 days).  

Carrying value of goodwill and investment in CardBASE

The directors following full consideration and research have decided that the 
current carrying value of CardBASE is realistic even though sales in the year 
ending 31 March 2007 were disappointing. The basis of the opinion of the 
directors is drawn from the following:

1)  The amount of the historic investment in developing a highly sophisticated 
    software and operational platform and the costs of replacement or creation 
    in a new venture.

2)  The commercialisation of this software and technology is currently in its 
    embryonic stage but the global market for multi-application card management 
    systems will be substantial based on the use of the company's products in 
    the identification, e passport, banking, medical, and public key 
    infrastucture solutions over the coming years.

3)  CardBASE has competitors who operate in the same market sectors who have 
    demonstrated a substantial value. Its competitor, Intercede Group plc, 
    which is quoted on AIM, has had a market capitalisation of between #15 and 
    #23 million over the last year on sales of #2.6 million and losses of 
    #400,000.

Auditors

A resolution for the reappointment of PKF (UK) LLP and to authorise the 
directors to agree their remuneration will be proposed at the forthcoming annual 
general meeting.

Approved by the board of directors and signed on behalf of the Board on 
28 September 2007.

John Wade
Company Secretary 



Consolidated Profit and Loss Account
For the year ended 31 March 2007
                                                                    As restated
                                                       2007                2006
                                                          #                   #
Group and share of Joint Ventures turnover        9,352,891          13,021,657
Less: Share of Joint Ventures turnover           (1,243,645)           (930,077)
                                                  ---------           ---------
Group turnover                                    8,109,246          12,091,580

Cost of sales                                    (9,336,370)        (11,981,089)
                                                  ---------          ----------
Gross (loss)/profit                              (1,227,124)            110,491

Sales and distribution costs                       (819,331)           (624,013)
Administrative expenses                          (2,480,848)         (2,349,169)
                                                  ---------           ---------
Operating loss                                   (4,527,303)         (2,862,691)
Group share of operating profit in
Joint Ventures                                       43,498              15,629
                                                  ---------          ----------
Group operating loss                             (4,483,805)        (2,847,,062)
Profit on disposal of tangible fixed assets               -             292,707
Fundamental reorganisation costs                    (50,000)         (1,083,292)
                                                  ---------          ----------
Loss before interest and taxation                (4,533,805)         (3,637,647)

Interest receivable and similar items                     -              44,691
Interest payable and similar charges               (224,472)           (198,235)
Group share of interest payable in
Joint Ventures                                      (11,016)             (4,455)
                                                 ----------          ----------
Loss before taxation                             (4,769,293)         (3,795,646)
Taxation                                                  -                   -
                                                 ----------          ----------
Loss after taxation                              (4,769,293)         (3,795,646)
                                                 ==========          ==========

Basic and diluted loss per ordinary share (pence)      (0.4)p             (0.4)p


Consolidated Balance Sheet
As at 31 March 2007
                                                       2007                2006
                                                          #                   #
Fixed assets
Intangible                                        2,790,076           3,191,770
Tangible                                          1,384,128           2,172,548
Investments                                         601,752             565,000
                                                  ---------           ---------                               
                                                  4,775,956           5,929,318
Current assets
Stocks                                              621,102             767,280
Debtors:falling due after                           478,827             108,887
one year
Debtors falling due within one year               2,007,677           2,874,286
Cash at bank and in hand                            872,887             770,973
                                                 ----------          ----------
                                                  3,980,493           4,521,426
Creditors:                                                                  
Amounts falling due within one year              (5,033,871)         (3,188,904)
Investment in Joint Ventures:
Share of gross assets                               747,440             485,776
Share of gross liabilities                         (798,346)           (568,819)
                                                  ---------           ---------
Share of net liabilities of Joint Ventures          (50,906)            (83,043)
                                                  ---------           ---------
Net current(liabilities)/ assets                 (1,104,284)          1,249,479
                                                 ----------          ----------
Total assets less current liabilities             3,671,672           7,178,797

Creditors:                                              
Amounts falling due after more than one year       (943,581)           (158,577)
(including loan stock)

Provisions for liabilities                         (178,597)           (787,385)
                                                 ----------          ----------
Net assets                                        2,549,494           6,232,835
                                                 ==========           =========

Capital and reserves
Called up share capital                          12,989,037          11,914,037
Share premium account                            20,660,520          20,719,276
Merger reserve                                    1,958,398           1,958,398
Revaluation reserve                                 415,000             415,000
Equity reserve                                       39,704                   -
Profit and loss account                         (33,513,165)        (28,773,876)
                                                 ----------         -----------
Equity shareholders' funds                        2,549,494           6,232,835
                                                 ==========         ===========

Consolidated Cash Flow Statement
For the year ended 31 March 2007
                                                       2007                2006
                                                          #                   #
Reconciliation of operating loss to 
operating cash outflow
Operating loss                                   (4,527,303)         (2,862,691)
Amortisation of intangible fixed assets             421,216             415,803
Depreciation of tangible fixed assets               847,728           1,012,946
Share based payments                                 66,000              39,000
Foreign exchange gains                              (35,996)                  -
Decrease in debtors                                 496,669             587,995
Decrease in stocks                                  146,178             193,820
(Decrease)/increase in creditors                  1,826,226          (1,978,276)
Exceptional restructuring costs                     (50,000)         (1,083,292)
Increase/(decrease) in provisions                  (608,788)            571,065
(Loss)/profit on disposal of fixed assets            (8,571)             13,187
                                                  ---------          ----------
Net cash outflow from operating activities       (1,426,641)         (3,090,443)

Returns on investments and servicing of finance    (224,472)            (73,463)
Capital expenditure and investing activities       (106,666)           (206,645)
                                                 ----------          ----------
Net cash outflow before financing                (1,757,779)         (3,370,551)
Financing                                         1,859,693           4,145,348
                                                 ----------          ----------
Increase in net cash in the year                    101,914             774,797
                                                 ==========          ==========
Reconciliation of net cash flow to movement 
in net debt        
Increase/(decrease) in net cash in the year         101,914             774,797
Repayment of lease finance                          167,421             273,928 
Increase in lease finance from sale and 
leaseback of assets                              (1,000,000)            (28,270)
(Increase) / decrease in loan stock                (260,296)          3,507,631
Decrease in commercial invoice financing            289,130             218,312
                                                 ----------          ----------
Change in net debt arising from cash flows         (701,831)          4,746,398
                                                 ----------          ----------
Movement in net debt in the year                   (701,831)          4,746,398
                                                 ==========          ==========
Net debt at beginning of year                      (604,841)         (5,351,239)
                                                 ----------          ----------
Net debt at end of year                          (1,306,672)           (604,841)
                                                 ==========          ==========

Notes to the Financial Statements

1.   Statement of Principal Accounting Policies

(a)  Basis of preparation of Financial Statements

The financial statements are prepared under the historical cost convention, as
modified by the revaluation of certain fixed asset investments, in accordance
with the Companies Act 1985 and applicable accounting standards.

(b)  Going concern

During the year the group incurred losses after exceptionals of #4,769,293 due
to low demand.  However, the directors have taken actions to increase sales,
maintain pricing, and reduce the group's costs. The board continues to
strenuously pursue opportunities to reduce costs and improve competitiveness.

The group is fundraising in the order of #2.0m. It was hoped that this would be
completed by the end of September latest and would allow the Group to regularise
the creditors and provide ongoing funds. We currently have support from a
non-trading creditor. LTSBCF, our financiers, have provided extra funds since
June on the invoice discounting line and this has been extended to the end of
October. The directors have considered the cash requirements of the Group on a
sensitised basis and have determined that #2.0m should be sufficient. The
fundraising has been affected by the stock markets' uncertainty. Potential
investors include several of our major shareholders who have indicated their
intention to participate. They, and new investors, are buoyed by the prospects
in the prepaid market. The directors believe the fundraising will complete in
the autumn.

Ongoing trading is improving and CardBASE has good sales prospects. The
directors consider that a projected upturn in sales will lead to profit and
positive cash flows for the Group and the Company, although this will ultimately
depend on improved trading.

The directors believe that they have considered all relevant information and
have concluded that it is appropriate to prepare these financial statements on
the going concern basis.

(c)  Basis of consolidation

The Group financial statements consolidate the financial statements of ID Data
Group Plc and its subsidiaries using the acquisition method, all of which have
been made up to 31 March 2007. The financial results of Joint Ventures have been
incorporated using the gross equity method based on accounts to 31 March 2007.

No profit and loss account is presented for the Company as an individual entity
in accordance with the exemption provided by section 230 of the Companies Act
1985. The Company's loss after tax for the financial year amounted to #50,046
(2006: loss #(50,450)).

(d)  Turnover

Turnover represents the total amount receivable for goods and services provided
in the ordinary course of business in the year, excluding value added tax.
Turnover is from tangible product and equipment and software packages (back
office services) and the Group recognises the turnover as per the contractual
arrangements with the customer.

Turnover is recognised as follows:

    a)  Card sales on transfer of ownership to the customer or despatch as
        blank cards.

    b)  Card personalisation, the addition to a) above of cardholder name,
        number, etc. on despatch.

    c)  Equipment on despatch.

    d)  Software packages licences as per contract with customer.

    e)  Professional services in line with the actual stage reached to date of
        acceptance certificate.

(e) Tangible fixed assets

Tangible fixed assets are stated at cost less depreciation. Depreciation is
provided at rates calculated to write off the cost of fixed assets, less their
estimated residual values, over their expected useful lives on the following
bases:

Leasehold improvements                               10 years
Computer equipment                                   3 years
Fixtures and fittings                                5 years
Plant and machinery                                  5 - 7 years
Motor vehicles                                       4 years

(f) Impairment

The carrying values of fixed assets are reviewed for impairment if events or
changes in circumstances indicate the carrying value may not be recoverable.

(g)  Research and development

Expenditure on research and development is charged to the profit and loss
account as incurred.

(h)  Finance and operating leases

Assets acquired under finance leases are treated as tangible fixed assets and
depreciation is provided accordingly. The present value of future capital
payments is shown as a liability and the interest element is charged to the
profit and loss account over the period of the lease so as to produce a constant
periodic rate of charge on the outstanding balance of the obligation for each
accounting period.

Operating lease rentals are charged in the profit and loss account on a straight
line basis over the lease term.

(i)   Goodwill

Goodwill arising on consolidation represents the difference between the fair
value of the consideration paid and the fair value of the identifiable net
assets acquired and is amortised through the profit and loss account over its
estimated useful economic life of 10 years.

(j)   Fixed asset investments

Investments are stated at cost or Directors' valuation less any provision for
impairment in value. In the case of unquoted investments the valuation is
reviewed by the Directors in the light of recent sale and purchase transactions
thereof.

(k)   Socks and work in progress

Stocks and work in progress are stated at the lower of cost and net realisable
value. Cost comprises expenditure directly incurred in purchasing or
manufacturing stocks together with, where appropriate, attributable overheads.

(l)   Foreign currencies

Transactions in foreign currencies are translated into sterling at the rate
ruling on the date of the transaction. Assets and liabilities in foreign
currencies are translated into sterling at the rate of exchange ruling at the
balance sheet date, and gains or losses on translation are included in the
profit and loss account.

The results of overseas operations are translated at the average rates of
exchange during the period and their balance sheets translated into sterling at
the rates of exchange ruling on the balance sheet date. Exchange differences
which arise from translation of the opening net assets and results of foreign
subsidiary undertakings and from translating the profit and loss account at an
average rate are taken to reserves.

(m)   Deferred taxation

As required by Financial Reporting Standard 19 "Deferred tax", full provision is
made for deferred tax assets and liabilities arising from all timing differences
between the recognition of gains and losses in the financial statements and
recognition in the tax computation, except for those timing differences in
respect of which the standard specifies that deferred tax should not be
recognised.

Deferred tax assets are only recognised when they arise from timing differences
where their recoverability in the short term is regarded as more likely than
not.

Deferred tax balances are not discounted.

(n)   Pensions

Contributions payable to the Group personal defined contribution pension scheme
are charged to the profit and loss account as incurred.

(o)   Capital instruments

Equity shares are included in shareholders' funds. Other instruments are
classified as liabilities if they contain an obligation to transfer economic
benefits and if not they are included in shareholders' funds.

The finance cost recognised in the profit and loss account in respect of capital
instruments other than equity shares is allocated to periods over the term of
the instrument at a constant rate on the carrying amount. During the year the
Group adopted the presentation requirements of FRS 25 "Financial Instruments:
Disclosure and Presentation" for convertible loan notes. Under the new policy
convertible loan notes are regarded as compound instruments, consisting of a
liability component and an equity component. At the date of issue, the fair
value of the liability component is estimated using the prevailing market
interest rate for similar non convertible debt. The difference between the
proceeds of issue of the convertible loan notes and the fair value assigned to
the liability component, representing the embedded option to convert the
liability into equity of the Group, is included in equity and is not
subsequently remeasured.

(p)   Share based payments

Equity settled share-based payments are measured at fair value at the date of
grant and expensed on a straight-line basis over the vesting period, based on an
estimate of shares that will eventually vest.

During the year the company has adopted FRS 20 ('Share based payments') to
account for share based payments using the fair value based method with respect
to all share based payments to directors and employees.

A prior period adjustment has been made to reflect this change of accounting
policy, the effect of which has been to increase administrative expenses in the
prior year by #39,000 The effect of the change in accounting policy on the
current year has been to increase costs by #66,000. There is no effect on
shareholders' equity.

2. Loss per share

Basic loss per share is calculated by dividing the Group's loss after taxation
of #4,769,293 (2006: #3,795,646) by the weighted average number of shares in
issue during the year of 1,191,992,823 (2006: 857,866,381).

No diluted earnings per share is presented as the effect of the exercise of
share options or the conversion of convertible loan stock would be to decrease
the loss per share.



Independent Auditors' Report to the members of ID Data Group Plc

We have audited the group and parent company financial statements ('the 
financial statements') of ID Data plc for the year ended 31 March 2007 which 
comprise the consolidated profit and loss account, the consolidated and company 
balance sheets, the consolidated cash flow statement, the consolidated statement 
of total recognised gains and losses and the related notes. The financial 
statements have been prepared under the accounting policies set out therein.

This report is made solely to the company's members, as a body, in accordance 
with section 235 of the Companies Act 1985. Our audit work has been undertaken 
so that we might state to the company's members those matters we are required 
to state to them in an auditors' report and for no other purpose. To the fullest 
extent permitted by law, we do not accept or assume responsibility to anyone 
other than the company and the company's members as a body, for our audit work, 
for this report, or for the opinions we have formed.

Respective responsibilities of directors and auditors

The directors' responsibilities for preparing the annual report and the 
financial statements in accordance with applicable law and United Kingdom 
accounting standards ('United Kingdom Generally Accepted Accounting Practice') 
are set out in the statement of directors' responsibilities.

Our responsibility is to audit the financial statements in accordance with 
relevant legal and regulatory requirements and International Standards on 
Auditing (UK and Ireland).

We report to you our opinion as to whether the financial statements give a true 
and fair view and have been properly prepared in accordance with the Companies 
Act 1985. We also report to you whether in our opinion the information given in 
the directors' report is consistent with the financial statements. The 
information in the directors' report includes that specific information 
presented in the chairman's statement and chief executive's review that is cross 
referenced from the business review section of the directors' report.

In addition we report to you if, in our opinion, the company has not kept proper 
accounting records, if we have not received all the information and explanations 
we require for our audit, or if information specified by law regarding directors' 
remuneration and other transactions is not disclosed.

We read other information contained in the annual report and consider whether it 
is consistent with the audited financial statements. The other information 
comprises only the directors' report, the chairman's statement and the chief 
executive's review.  We consider the implications for our report if we become 
aware of any apparent misstatements or material inconsistencies with the 
financial statements. Our responsibilities do not extend to any other 
information.

Basis of audit opinion

We conducted our audit in accordance with International Standards on Auditing 
(UK and Ireland) issued by the Auditing Practices Board, except that the scope 
of our work was limited as explained below.

An audit includes examination, on a test basis, of evidence relevant to the 
amounts and disclosures in the financial statements. It also includes an 
assessment of the significant estimates and judgments made by the directors 
in the preparation of the financial statements, and of whether the accounting 
policies are appropriate to the group's and company's circumstances, 
consistently applied and adequately disclosed.

We planned our audit so as to obtain all the information and explanations we 
considered necessary in order to provide us with sufficient evidence to give 
reasonable assurance that the financial statements are free from material 
misstatement, whether caused by fraud or other irregularity or error.  However, 
with respect to intangible assets of #2.2m in the consolidated balance sheet and 
investments of #2.5m in the company balance sheet relating to a subsidiary 
undertaking, CardBASE Technologies Limited, the directors have not been able to 
provide sufficient evidence for the purposes of our audit in determining the 
carrying value of these assets as part of their impairment review and hence we 
have been unable to determine whether the carrying value is appropriate.  
Further details of the basis of the directors' assumptions regarding the 
carrying value of the goodwill and investment in CardBASE Technologies Limited 
is set out in note AA.

In forming our opinion we also evaluated the overall adequacy of the 
presentation of information in the financial statements.  

Qualified opinion arising from limitation in audit scope 
Except for the financial effects of such adjustments, if any, as might have been 
determined to be necessary had we been able to satisfy ourselves as to the 
carrying value of the goodwill and investment in CardBASE Technologies Limited 
referred to above, in our opinion:

*  the financial statements give a true and fair view, in accordance with 
   United Kingdom Generally Accepted Accounting Practice, of the state of the 
   group's and the parent company's affairs as at 31 March 2007 and of the 
   group's loss for the year then ended; 

*  the financial statements have been properly prepared in accordance with the 
   Companies Act 1985 and

*  the information given in the directors' report is consistent with the 
   financial statements.

In respect solely of the limitation of our work in connection with the carrying 
value of the goodwill and investment in CardBASE Technologies Limited we have 
not obtained all the information and explanations that we considered necessary 
for the purpose of our audit.

Emphasis of matter - going concern

In forming our opinion, which is not qualified, we have considered the adequacy 
of the disclosures made in note 1(b) of the financial statements concerning the 
Company and the Group's current funding position.  The group incurred a loss 
after tax of #4,769,293 during the year ended 31 March 2007.  The current 
funding position, along with the other matters explained in note 1(b) to the 
financial statements, indicate the existence of a material uncertainty which may 
cast significant doubt about the Company and the Group's ability to continue as 
a going concern.  The financial statements do not include the adjustments that 
would result if the Company and Group were unable to continue as a going 
concern.


PKF (UK) LLP                                              London, UK
Registered Auditors                                      28 September 2007 
 






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