We invested approximately € 78 million in research and development (R&D) in fiscal 2004/2005 (previous year: € 73 million), representing a 7 % increase on last year and putting R&D expenses as a percentage of net sales revenue at 4.5 % (previous year: 4.6 %).

With a view to reinforcing our technological strength in the future, we recruited additional R&D staff. At the end of the reporting period, the number of employees working in R&D was 714 (previous year: 660), equivalent to 10.3 % of total headcount. The R&D employees work at our development facilities in Germany, Switzerland, Singapore, Indonesia, the U.S. and China.

They have been working on a large number of new developments. Worldwide, we registered 55 new patents, bringing the total number of active patents up to 866.

R&D Areas of Focus. In terms of technology, the banking and retail sectors are increasingly seeking the same base technologies. In the retail segment, self-service-based transaction processes are leading to this convergence. Examples of this include cash recycling and self-checkout systems that retailers are using to automate cash handling activities. Also, ePOS and kiosk systems are being adapted to meet the requirements of postal service companies.

In the banking segment, we have concentrated on deposit and recycling technology for use in strategic markets. Both technologies have been adapted to meet the specific requirements of key countries. Our ATM portfolio has also been extended with a compact cassette-based recycling system.

As for software, the focus has been on the development of net-centric applications to manage large self-service networks (ProClassic/Enterprise). We are paying particular attention to establishing and growing an extensive IT security product family designed to keep self-service networks safe from external attack.

Our key product families in the banking segment, such as ATMs and terminal systems, have been the subject of continuous ongoing enhancement and complementation.

In retail, we expanded our portfolio with a new reverse vending system for the return of non-deposit PET bottles or aluminum cans, which are taken back and compacted separately by material.

In the self-checkout segment, we have developed customer-specific variations for different projects and implemented these successfully in test applications at customer sites. We have developed a new standardized solution concept to support closed-loop cash handling for stand-alone checkout systems, such as those used in service stations. The product families currently offered in the retail business, such as the BEETLE ePOS systems and terminal solutions for lottery companies, have been undergoing continuous enhancement and complementation.

The emphasis in software development has been on adding new features to our TP.net point-of-sale software. The software enables simple administration of software installed on ePOS systems and can be used with various different checkout concepts. In addition, it automatically provides all available checkout functions in Web-based form for running mobile solutions.