EANS-News: Identive Group Inc. / IDENTIVE GROUP ANNOUNCES FOURTH QUARTER AND FISCAL 2012 RESULTS

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Subtitle: Strengthening revenue trend and continued expense
reductions drive return to positive adjusted EBITDA

annual result

SANTA ANA, Calif. and ISMANING, Germany, March 7, 2013 (euro adhoc) -
Identive Group, Inc. (NASDAQ: INVE; Frankfurt: INV), a provider of
products, services and solutions for the identification, security and
RFID industries, today announced results for the fourth quarter (Q4)
and year ended December 31, 2012.

Q4 2012 Highlights:
- Record quarter for NFC and RFID transponder sales

- Improved smart card reader market in Europe and strong demand in Asia
- 22% reduction in base operating expenses compared to fourth quarter
2011, further lowering breakeven point
- Return to profitability on adjusted EBITDA basis - year over year
improvement of $1.0 million
- Cash of $7.4 million at year end

"The strengthening trend we saw beginning late in Q3 continued
through Q4 with increased order flow and improved traction in much of
our business. Pent up demand following the resumption of delayed
customer projects, plus several new orders, drove NFC and RFID
transponder sales in Q4 to more than double from the previous quarter
and grow 34% year over year. It was particularly good to see improved
order activity in Europe after several difficult quarters, and we
also saw strong demand from a variety of our markets in Asia. Our
U.S. Government sales remained stable and we have seen an increase in
program activity at the state level," stated Ayman S. Ashour, CEO and
chairman of Identive. "Our improved revenue performance combined with
further reductions in base operating expenses allowed us to return to
profitability on an adjusted EBITDA basis in Q4, and at a higher
level than in the past."

Q4 Results As reported in accordance with U.S. generally accepted
accounting principles (GAAP), Q4 2012 revenues were $26.6 million,
down 5% from $27.9 million in Q4 2011. By segment, Identity
Management Services and Solutions (Identity Management) revenues were
$13.4 million and ID Products revenues were $13.2 million in Q4 2012.

GAAP gross profit margin was 39% in Q4 2012, compared with 41% in Q4
2011, reflecting a higher mix of product revenues versus systems and
services. Total base operating expenses (consisting of research and
development, sales and marketing, and general and administrative
expenses) were $10.5 million in Q4 2012, down 22% from $13.4 million
in Q4 2011 as a result of cost reductions implemented under the
restructuring plan the Company initiated in June 2012 and from
ongoing initiatives to improve the efficiency of the business.

In Q4 2012, Identive recorded GAAP net income of $0.2 million, or
$0.00 per share in Q4 2012, compared with net loss of $(2.6) million,
or $(0.05) per share in Q4 2011. Net income in Q4 2012 includes a
$1.4 million benefit for income taxes mainly related to impairment
charges taken earlier in the year. On a non-GAAP basis, gross profit
margin was 41% in Q4 2012, compared with 43% in Q4 2011. Non-GAAP net
income was $0.6 million, or $0.01 per share in Q4 2012, compared with
non-GAAP net loss of $(1.2) million, or $(0.02) per share in Q4 2011.
Adjusted EBITDA was $1.2 million in Q4 2012, compared with $0.2
million in Q4 2011.

Non-GAAP gross profit margin, adjusted EBITDA and non-GAAP net loss
and net loss per share all exclude various items that are detailed in
the financial table and accompanying footnotes reconciling GAAP to
non-GAAP results contained in this release. An explanation of these
measures is also included below under the heading "Non-GAAP Financial
Measures."

Cash and cash equivalents were $7.4 million at December 31, 2012 and
reflected proceeds of $6.9 million from a secured loan facility and a
$3.6 million increase in working capital during the quarter. This
compares with $6.3 million of cash and cash equivalents (net of
restricted cash) at September 30, 2012.

Outlook for Q1 and Full Year 2013 Commenting on management's outlook,
Ashour said, "The positive demand trends we saw in Q4 are continuing,
setting the stage for a favorable outlook for 2013. Our transponder
production is booked at full capacity through the middle of Q2 and
new sales activity remains strong for NFC tags, SmartCore card
technology and RFID products for electronic payment, ticketing, M2M
and ID applications. We continue to extend our activities in the
payment sector with new customer contracts and additional
applications. The U.S. budget sequestration introduces uncertainty
and potential disruption into our otherwise stable U.S. Government
business, but we believe any effects would be confined to the near
term as the majority of programs we address are mandate-driven and
tied to security initiatives."

Based on its current expectations, management expects revenues of
$22.0 million to $24.0 million in the first quarter of 2013, which is
seasonally the weakest of the year, and further expects non-GAAP,
adjusted EBITDA of $ (1.5) million to (0.75) million. For full year
2013, management expects revenues of $105.0 million to $115.0 million
and non-GAAP, adjusted EBITDA of $4.0 million to $6.0 million.

Full Year 2012 Results Commenting on 2012 full year results,
Identive's CFO, David Wear said, "2012 was a challenging year as
economic austerity measures impacted Citizen ID programs in Europe
and contributed to a 25% drop in sales in the region. Customer
project deferrals also impacted sales of our transponder products for
the first three quarters. We took action in June to accelerate
expense reduction and lowered our breakeven point by taking out more
than $6 million in costs. At the same time, we increased our R&D
investment and made significant progress in the development of core
identification technologies as well as new and enhanced offerings to
drive future sales. We entered 2013 with a leaner operating model and
a stronger portfolio of products and solutions for Secure ID."

Revenue for the full year 2012 was $94.6 million, down 8% from $102.7
million in 2011. Revenue from Identive's Identity Management services
and solutions segment was $54.1 million in 2012, down 4% from $56.5
million in 2011 primarily as a result of the completion of a large
European Citizen ID program in the previous year, for which there
were no new orders in 2012. Revenue from the Company's ID Product
segment was $40.4 million, down 13% from $46.2 million in 2011 as a
result of weaker demand for the Company's smart card readers for
Citizen ID programs in Europe and deferrals of transponder product
orders. These factors were partially offset by stronger sales of
smart card readers to the U.S. government market to enable cyber
security programs in 2012.

Including the effect of significant non-cash impairment charges and
associated adjustments recorded in the second and third quarters of
the year, GAAP net loss in 2012 was $(50.3) million, or $(0.84) per
share, of which $(0.76) per share related to impairment. This
compares with net loss of $(9.8) million, or $(0.18) per share in
2011.

Conference Call and Webcast Information Identive Group will host a
conference call and webcast today at 9:00 AM Eastern Time, which can
be accessed by dialing 888.771.4371 (toll free within the U.S.) or +1
847.585.4405 (for international callers) and using pass code
34372133. A webcast of the call that includes presentation slides can
be accessed by visiting the investor relations section of the
Company's website at www.identive-group.com, and by clicking on
"Presentations, Reports & Webcasts," where it also will be archived
for those unable to listen to the live webcast. An audio replay of
the call also will be available for one week and can be accessed by
dialing 888.843.7419 (toll free within the U.S.) or +1 630.652.3042
(for international callers) and using pass code 34372133.

About Identive Group Identive Group, Inc. (NASDAQ: INVE; Frankfurt:
INV) is focused on building the world's signature company in Secure
ID. The company's products, software, systems and services address
the markets for identity management, physical and logical access
control, cashless payment, NFC solutions and a host of RFID-enabled
applications for customers in the government, enterprise, consumer,
education and healthcare sectors. Identive's mission is to build a
lasting business of scale and technology based on a combination of
strong technology-driven organic growth and disciplined acquisitive
expansion. The company delivers up-to-date information on its
activity as well as industry trends through its industry-leading
social media initiatives and educational resource, AskIdentive.com.
For additional information, please visit www.identive-group.com or
follow on Twitter at @IdentiveGroup.

Non-GAAP Financial Measures (Unaudited) Identive has provided in this
release financial information that has not been prepared in
accordance with GAAP, including non-GAAP gross profit margin,
adjusted EBITDA and non-GAAP net income (loss) and net income (loss)
per share. Identive uses these non-GAAP financial measures internally
in analyzing its financial results and believes they are useful to
investors, as a supplement to GAAP measures, in evaluating Identive's
ongoing operational performance. Identive believes that the use of
these non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and trends.
As noted, the non-GAAP financial results discussed above exclude
various items which are detailed in the reconciliation table and
accompanying footnotes contained within this release. Non-GAAP
financial measures should not be considered in isolation from, or as
a substitute for, financial information prepared in accordance with
GAAP. Investors are encouraged to review the reconciliation of these
non-GAAP measures to their most directly comparable GAAP financial
measures as detailed in this release.

Note Regarding Forward Looking Information: This press release
contains forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements can be identified by words such as "anticipates,"
"believes," "plans," "will," "intends," "expects," and similar
references to the future. Examples of such statements include,
without limitation, statements we make regarding our expectations
regarding continued demand for our products, solutions and services
in 2013, our expectations regarding the successful deployment of and
market acceptance of our NFC, cashless payment and cloud-based
solutions, our expectations regarding future results, including Q1
and full year 2013 results, and our expectations for future growth
and profitability. Readers should not unduly rely on these
forward-looking statements, which are not a guarantee of future
performance and are subject to a number of risks and uncertainties,
many of which are outside our control, which could cause our actual
business and operating results to differ. Factors that could cause
actual results to differ materially from those in the forward-looking
statements include our ability to grow our company based on a
strategy of providing products, components and services for the
secure identification market; to successfully develop and
commercialize new products and solutions that satisfy the evolving
and increasingly complex requirements of customers; whether the
markets in which we participate or target may grow, converge or
standardize at anticipated rates or at all, including the markets
that we are targeting; our ability to successfully compete in the
markets in which we participate or target; our ability to meet our
sales forecasts; our ability to meet financial covenants of our loan
agreement; our ability to meet growing demand for our products; and
general global political and economic factors which are beyond our
control but may unduly impact our markets and our business. For a
discussion of further risks and uncertainties related to our
business, please refer to our public company reports, including our
Annual Report on Form 10-K for the year ended December 31, 2011 and
subsequent reports filed with the U.S. Securities and Exchange
Commission. All forward-looking statements are based on information
available to us on the date hereof, and we assume no obligation to
update such statements.

### Note: Identive and the Identive logo are trademarks of Identive
Group, Inc, registered in many jurisdictions worldwide. All other
company, product or service names may be trademarks or registered
trademarks of others and are the property of their respective owners.
Contacts:

Further inquiry note:
US: Darby Dye, +1 949 553-4251, ddye@identive-group.com
Europe: Lennart Streibel, +49 89 9595-5195, lstreibel@identive-group.com

end of announcement euro adhoc
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company: Identive Group Inc.
Carnegie Ave., Bldg. B 1900
US-CA 92705 Santa Ana
phone: +1 949 553 4280
FAX: +49 89 9595-5555
mail: investorrelations@identive-group.com
WWW: http://www.identive-group.com
sector: Computing & Information Technology
ISIN: US45170X1063
indexes: NASDAQ
stockmarkets: free trade: Berlin, München, Hamburg, Düsseldorf, Stuttgart,
Nasdaq: New York, Open Market / Entry Standard: Frankfurt
language: English