Smart business sees ERG hit paydirt in Asia - Brief Article

Business Asia, May 19, 2000

Best Use of Australian Technology in Asia

Perth-based ERG Group has narrowly beaten its competitors to win the Best Use of Australian Technology in Asia category in this year's Business Asia Awards.

ERG, which faced tough competition from other technology leaders such as Clipsal and Cochlear, has had an outstanding financial year to date.

Earnings for the six months leading to December 31, 1999, rose 199 per cent from the same period last year to A$15 million. Sales also doubled to A$174 million.

The ERG Group is a world leader in the development and supply of technologically advanced smart card systems, automated fare collection products, and telecommunications products and services.

The company provides services ranging from design and manufacture to supply, installation, commissioning and ongoing maintenance.

ERG has won more than A$1 billion worth of contracts in six continents during the past year through its alliance with Motorola Inc, the world's No.2 cellular phone maker.

New ERG smart card technology is earmarked for use in transport projects across the world.

The technology, called MASS, is based on the company's Hong Kong transit system product, which has been operating since 1997.

To date, the value of contracts won by ERG in Hong Kong alone totals more than A$160 million.

Its most recent deal in the Asian market was a A$15 million contract for the Tseung Kwan O extension in Hong Kong's MTR system.

The deal will provide Octopus smart card holders in Hong Kong with access to the new rail link.

The Octopus System, which has been supplied to Creative Star by ERG, enables passengers to use a single, contact-free smart card on major modes of public transport. Waving a reloadable card over the reader will automatically deduct the correct fare.

Today's success story surrounding ERG is a tribute to the company's chief executive Peter Fogarty.

Not much more than a year ago ERG was experiencing share-price problems and lacked investor confidence because of the three-year delay in full commissioning of Melbourne's Metcard ticket system, which ERG designed and built.

Now Fogarty is a darling of broking analysts and fund managers -- and the company's share price has rocketed, notwithstanding recent fluctuations involving global hi-tech stocks.

In recent days, further good news has arrived for ERG, winning a contract to supply and install an electronic ticketing and fare collection system for the Airtrain rail service in Brisbane. The contract for the supply of equipment is valued at A$763,955, with construction and pre-operational testing to be completed by the end of the year ahead of the Airtrain launch in May, 2001.

The other finalists in this category were:

* Clipsal,

* Cochlear Ltd,

* ECS International,

* Poly Optics Australia; and

* Systemik Solutions.