"I am pleased to report ReD has continued to perform well in the first quarter of the new financial year and it has maintained the momentum achieved throughout 2005. We are also pleased by the progress of our two recent acquisitions that completed late last year.

Overall, the Board is encouraged that trading is slightly ahead of our internal expectations in the first quarter and we look forward to building on this during the rest of the year. Although still early, the performance so far augurs well for 2006."

Detailed Operational Performance:

"The ongoing success of our Card Issuing Operation continues to demonstrate why we see this area of the payment industry as one that warrants particular strategic focus.

Our Australian fuel card business has had an excellent start to the year, showing good progress against each of its key performance indicators. In particular, it had a strong first quarter in terms of increasing the size of its card base, with low customer attrition and encouraging new card sales, including an extension to our relationship with Australia Post.

In the UK and Europe, we are pleased with the progress of ReD Fuel Cards(Europe), acquired in November 2005 (formerly Fuelserv). Trading has been encouraging, with results for the first quarter slightly ahead of our internal expectations.

ReD Fuel Cards (Europe) is also responding well to the four point strategic plan instigated at the time of the acquisition. Numbers of cards in issue have increased by some 5% in the first quarter and we are actively pursuing opportunities to enhance the network that accepts our cards both in the UK and in continental Europe. The business is also undergoing a re-branding exercise that began with the name change announced along with our Preliminary results on 3 March. A number of operational costs savings have also been achieved.

Our other recent acquisition, the pre-paid gift card operator E Com, is also performing well, with trading in the first quarter again slightly ahead of our internal expectations.

The first quarter of 2006, as expected, saw more than double the number of transactions processed compared to the corresponding period in 2005. Overall, revenue from E Com in the first quarter was more than 80% up on the same period last year.

We have completed a 100-day integration plan at E Com and the finance and customer relations departments are now fully integrated with our existing Australian fuel card operation. We are also advanced in our plans to strengthen both the development and sales & marketing activities, and we are building an encouraging prospect bank.

Further to this, we are also working actively on targeting potential UK customers for pre-paid card programmes. Although sales cycles in this area are relatively long, we already have some good prospects and have been encouraged by the general level of interest being shown by retailers in this area.

ReD's Fraud Prevention & Payment Processing Operation has continued in a similar vein to 2005. The US business continues to suffer from last year's loss of a fixed line telephony client and new contracts brought on to replace this revenue have been slow to grow. However, developments such as the recently announced partnership with First Data provide encouragement for the future. In Europe we have seen a very pleasing start to the new year, with strong underlying growth in transactions processed and new & extended contracts in both the mobile telephony and on-line retailing environments."