NW_20020709_VASCO Provides Second Quarter Update

July 9, 2002

OAKBROOK TERRACE, Ill. and BRUSSELS, Belgium, July 9, VASCO (Nasdaq: VDSI; Nasdaq Europe) ( www.vasco.com ), a global provider of enterprise-wide security products that support e-business and e-commerce, today announced that revenues, operating loss and earnings per share will be below the anticipated levels for the second quarter due to continued weakness in the IT security sector. Revenues are expected to be approximately $4.0 million, with an operating loss of between $2.0 and $2.4 million, and a loss per share of between $.09 and $.12. The Company also announced that it has already implemented a significant cost reduction program as a result of the continued weakness in the sector. The estimated results do not include certain accruals for cost reductions which are not currently estimated. Management will discuss these results, cost reductions and outlook on its regular earnings conference call on July 24. Details of this call will be released at a later date.

Mario Houthooft, President and CEO of VASCO commented, "The second quarter of 2002 was very difficult for VASCO, as for the large majority of the security sector. The interest in VASCO’s products is high and is rising. Unfortunately, the customers’ buying cycle has become longer, which has delayed a substantial amount of orders. As a result, we have already implemented a cost reduction plan designed to cut 25% or more of our normal operating expenses. We firmly believe in the strength of our Company's products and its market positioning. At this moment, we can see that our order intake is getting more solid. VASCO is ready to take advantage of its lean cost structure when the sector rebounds."

The Company also announced the resignation of Annemieke Blondeel, Director of Investor Relations. Her duties will be assumed by Jochem Binst, Director of Corporate Communications, in Europe and Dennis Wilson, Chief Financial Officer, in the United States.

VASCO secures the enterprise from the mainframe to the Internet with infrastructure solutions that enable secure e-business and e-commerce, protect sensitive information, and safeguard the identity of users. The Company's family of Digipass® and VACMAN® products offers end-to-end security through strong authentication, digital signature, and Radius, LAN and Web security, while sharply reducing the time and effort required to deploy and manage security. VASCO's customers include hundreds of financial institutions, blue-chip corporations, and government agencies in more than 50 countries. More information is available at www.vasco.com .

Forward Looking Statements
Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement containing words such as "believes," "anticipates," "plans," "expects," and similar words, is forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking

Reference is made to the Company's public filings with the US Securities and Exchange Commission for further information regarding the Company and its operations.

For more information contact:

VASCO Data Security:
Jochem Binst, +32 2 456 9810, [email protected]