Untitled

2021 Annual Report 1

Annual Report

2021

2021 Annual Report 2

Meltwater, the leading

global social and media

intelligence provider, analyzes

~1 billion online documents

each day and enables PR,

Communications, and Marketing

professionals to make informed

strategic decisions and

inuence the world around them.

2021 Annual Report 2

2021 Annual Report 3

Table of Contents

4

Letter from Founder & Chairman

7 Meltwater at a Glance

8 Key Figures

9 2021 Highlights

11 20 Years of Meltwater

13 Letter from the CEO

15 Our Solutions

21 Customer Testimonials

26 People and Culture

28 Corporate Responsibility

32 MEST

34 Director’s Report

53 Governance Report

71 Remuneration Report

78 Financial Statements

199 Independent Auditor’s Report

211 Income Statement Using Alternative Performance Measures (APMs)

214 Denitions: Alternative Performance Measures

DISCLAIMER: This PDF version is not the ocial annual report. It has been prepared for ease of use and does not contain the ESEF

information as specied in the Regulatory Technical Standards on ESEF (Delegated Regulating (EU) 2019/815). The ocial ESEF

reporting package is available via www.meltwater.com/en/about/investor-relations/events-reports#additional-annual-reports.

In case of any discrepancies between this PDF version and the ESEF package, the latter prevails.

2021 Annual Report 4

Letter from Founder & Chairman

In the summer of 2001, I started Meltwater with Gard Haugen, a

colleague of mine from a previous startup. We started Meltwater

in a shack with $15,000 and a coee machine. Our vision was

that when executives and decision-makers arrived for work in the

morning and enjoyed their usual cup of coee, our software would

create a summary of what had happened in the world during

the previous 24 hours in a format that was so simple to read that

within seconds they would get the key updates that they needed

about competitors, key clients and their own brand.

At the time we did not realize how big a macro trend we had

stumbled upon. Initially, we focused on online news and

company websites. We didn’t anticipate the rise of social media.

Facebook was founded in 2004, Twitter in 2006. Blogs didn’t reach

mainstream attention until around 2007. All this new online content

fueled a need for new, sophisticated software with the ability to

analyze billions of documents every day. Today, smart algorithms,

natural language processing (NLP), machine learning and big-

data techniques are used to create analytics and insights from

online news and social media that we would not have dreamed of

back in 2001.

For the rst 12 years we built the company without any external

funding. We bootstrapped it from 0 to $125 million dollars in

revenue nanced exclusively with cash ow from customers.

This forged a scrappy and customer-centric culture. Our main

bottleneck for growth was our ability to attract and develop talent,

which in turn created a culture passionate about people and an

ability to grow and promote talent from within. Our CEO John Box

and his leadership team are a testament to this.

From these humble beginnings, we have grown to 2,200

employees, with 50 oces in six continents. Today, Meltwater is

a global business serving 27,000 of the world’s most innovative

and ambitious companies. Our clients comprise a wide range of

organizations from every industry, from The Coca-Cola Company

to the Vatican in Rome. Our client base is so diverse because every

company and organization in the world needs to understand the

market they operate in to stay successful. And that is the value we

oer at Meltwater. We automatically track and analyze the world’s

online news and social media in real time and provide alerts

about threats and opportunities tailored to every organization’s

unique needs.

JØRN LYSEGGEN

EXECUTIVE CHAIR

2021 Annual Report 5

Working with clients all over the world and seeing the value they

can extract from external data has over the years created a

growing realization that we have barely scratched the surface

in terms of the role external data will play in decision-making.

Consumers and companies today produce online content at

an unprecedented rate. Companies are embracing the internet

as a strategic arena to promote their brand, products and

jobs, and are increasing their online investment and content

creation accordingly.

Every day the amount of information on the internet is growing

exponentially, a trend to which we see no end. We are all drowning

in data. And the more data there is, the more need there is for

a software like Meltwater that can cut through the clutter and

extract the key insights that are really important.

I believe we are on the cusp of a big transformation when it comes

to corporate decision-making. Everyone wants to be rigorous, and

data-driven, but decision making today is mostly based on internal

data. The need to manage, understand, and analyze internal data

created a massive industry with ERP companies such as Oracle,

SAP, Salesforce, and a whole bunch of BI and data warehouse

companies. We can expect to see a similar development for

external data.

Today, companies are ad hoc when it comes to tracking external

signals that can be found on the internet. External data is

arguably the biggest blind spot in corporate decision making

today. External data is rich of leading indicators, in contrast

to internal data which is predominantly composed of lagging

indicators. As companies jockey to improve their positions in an

increasingly dynamic and fast-paced competitive environment,

the companies with the best ability to use external data to

anticipate change, and to respond accordingly, will win.

For over 20 years, Meltwater has galvanized the technology,

content partnerships, and institutional skill sets required to extract

and successfully commercialize critical business insights extracted

from the unstructured, messy environment that is the internet. We

are well positioned to become the global leader in a new software

category emerging from the need to mine external data. We

have 50 local oces on 6 continents and already serve 27,000

companies in 130 countries. We started with online news. Today

we double down on social media. In the future we will pursue

additional data types that can be mined for signals, agging

threats and opportunities.

2021 Annual Report 6

For over 20

years, Meltwater

has built the

technology,

content

partnerships,

global client

base, and

institutional skill

sets required

to become the

global leader in

a new software

category

emerging from

the need to

mine external

data

.

As you will see from this Annual Report, 2021 was a very good

year for Meltwater. We improved across pretty much all key

performance indicators and exited the year as a stronger and

healthier company than we entered it. We see robust demand in

the market for our oerings, we have a strong balance sheet, and

we have a healthy cash ow generation from operations.

We are grateful for the support we have received by all our

customers and investors in this journey. I want to congratulate the

new generation of leadership at Meltwater which has vitalized the

organization with new energy and new ambitions and thank all

the hard-working people at Meltwater for all their tireless eorts.

As we look forward, the world today is facing a number of

uncertainties because of an unstable geopolitical situation. We

are likely entering challenging macro-economic times, but in spite

of this I continue to be optimistic. Meltwater has experienced

many turbulent times. We started the company in 2001 which

was a nuclear winter for internet start-ups. We experienced

9/11, SARS in 2003, the nancial crisis in 2008/2009 and of

course the global pandemic in 2020/2021. Through challenging

times, we have experienced that our services are remarkably

robust. We have continued to grow at a healthy pace through

recessions and global turbulence. That said, we are facing

times of more uncertainty so we will stay alert and monitor the

development closely.

Long term, I am very optimistic. When we started Meltwater in

a shack in Oslo back in 2001, we were bullish on how important

mining external data was going to become. 20 years later, I am

more condent than ever that the most successful companies

in the world will be the ones with the best ability to use external

data, and that Meltwater is uniquely positioned to become the

global leader in a new and exciting software category.

2021 Annual Report 7

Meltwater at a Glance

Meltwater is the global leader in social & media intelligence.

Since 2001, we have been providing solutions that help our customers make more

informed business decisions. Today, we are a global leader in social and media

intelligence with teams and customers on six continents.

~27,000

Corporate Customers

in 130+ countries

~2,200

Employees

~50

Oces across

6 continents

$444m

ARR as of 2021

~100%

Recurring revenue

Customer-

centricity

More than 27,000

companies use Meltwater

to get the full picture of

their brand, competitors

and industry. Our teams

are intimately acquainted

with their customers’

biggest challenges,

enabling us to create,

adapt and innovate our

solutions with our clients’

needs in mind.

Innovation

At Meltwater, innovation

is at the core of everything

we do. Over the years,

the company has been

able to grow rapidly by

staying ahead of the

technological trends

that have shaped our

industry. We will continue

to invest in our products

and technology to create

even more value for

our customers.

People + Culture

Our people, values

and award-winning

culture have fueled our

success for more than

20 years. We have a

fundamental belief in

people and the potential

that they possess and

aspire to provide all of

our employees with the

opportunities they need

to succeed.

Growth

Meltwater has

experienced strong growth

for two decades. We are

a market leader with an

integrated SaaS oering,

founded on protable

growth both organically

and through strategic

M&A. We plan to grow

20% organically with 20%

adjusted EBITDA margins

long term.

HQ

2021 Annual Report 8

Key Figures

ARR based on constant currency rate as of December 2020

TTM = Trailing twelve months

PREMIUM CLIENT ARR

YoY GROWTH

2020

: 12%

36%

TOTAL ANNUAL RECURRING REVENUE (ARR)

2020

: $371m

2% YoY growth

20% YoY growth

$444m

ADJUSTED EBITDA

2020

: $37m

$39m

ADJUSTED EBITDA MARGIN

2020

: 10%

10%

REVENUE

2020

: $360m

4% YoY growth

12% YoY growth

$402m

SOCIAL SEGMENT

ARR GROWTH

2020

: 22%

55%

TTM CLIENT NET RETENTION

(%)

2020

: 86%

95%

2021 Annual Report 9

2021 Highlights

ACQUISITION Meltwater announces agreement

to acquire social media intelligence

company Linkuence

PRODUCT Launch of Competitive Benchmarking

dashboards for Facebook and

Instagram in Engage. Compare

audience growth, engagement rates,

and post performance on Instagram

and Facebook against competitors

and industry peers with Competitive

Benchmarking templates

Meltwater becomes title sponsor of the Meltwater

Champions Chess Tour

CEO John Box named to PRWeek’s Dashboard 25

as a leader in shaping the comms tech sector

ACQUISITION Meltwater announces agreement

to acquire leading social

inuencer marketing company

Klear

Launch of Meltwater Academy Customer

Certication Program

PRODUCT New Data Sources in Explore,

including TikTok, Twitch, Pinterest,

Weibo, WeChat, Douyin, and Red

Meltwater joins the Twitter Ocial Partner Program

Meltwater brings on global DEI consultant

Nicole Sanchez to support DEI strategy

ACQUISITION Meltwater announces agreement

to acquire Silicon Valley business

intelligence company Owler

FEB 2 0 2 1

MAR 2 0 2 1

AUG 2021

JUNE 2 0 2 1

APR 2 0 2 1

JULY 2021

SEPT 2021

JAN 2021

92021 Annual Report

PRODUCT Launch of predictive mode in

Klear, enabling users to predict

campaign results based on the

inuencers they plan to work with

and the number of posts they

expect them to publish

2021 Annual Report 10

Alibaba

Allianz

Amazon Web Services

Bayer AG

Baidu

Colgate-Palmolive

Estée Lauder

Ferrari

HBO

LEGO

LVMH

Marriott

McKinsey & Company

Monster Energy

Nestle

Nike Inc.

Olympus

Corporation

Penguin Random House

Pernod Ricard

PricewaterhouseCoopers

Ralph Lauren

Strava

UNICEF World Health

Organization

U.S. Department of

Commerce

U.S. Department of

Transportation

Warner Music Group

Zalando

Inaugural Capital Market’s Day

ACQUISITION Meltwater acquires Oxford

University spin-o, DeepReason.ai

Uplisting from Euronext Growth Market to the Main

Market of the Oslo Børs

Launch of long-term partnership with The New York

Times to provide full-text content for all customers

globally

Integrations added in 2021 include Slack, Microsoft

Teams and Gmail, allowing users to integrate

Meltwater with their existing workows and gaining

maximum value and eciency

886 Premium Customers* Added

(up from 345 in 2020)

Meltwater launches the Oxford Meltwater Leadership

Programme at Oxford University’s Said Business

School

LEADERSHIP Welcoming two new executives,

CFO Elena Shishkina and

CSO Alexandra Bjertnaes

PRODUCT Launch of Monitor – a multi-stream

monitoring experience that helps

PR Pros consume more content,

more eciently across multiple

searches, tags and RSS feeds

OCT 2021

NOV 2021

DEC 2021

102021 Annual Report

SELECTED

NEW

PREMIUM

CUSTOMERS

IN 2021

SELECTED

AWARDS

* >$25.5K ARR

2021 Annual Report 11

Meltwater was founded in 2001 based on a simple product idea:

a software supplying executives with relevant updates about

their customers, competitors, and industry. Meltwater’s founder,

Jørn Lyseggen, knew rst-hand the time and manual research

needed for an executive to track all this information. His vision

was a sophisticated software tool that in real time could track and

analyze thousands of websites and highlight the key relevant news

in an executive summary. Leaders of companies, big and small,

around the world could read the Meltwater morning report in the

same time it took them to enjoy their morning coee, and be ready

to start their day armed with the information they need to make

better business decisions.

Established in Norway with only $15,000 and a coee machine,

Meltwater was the world’s rst online media monitoring company.

We began our global expansion throughout Scandinavia, then the

United Kingdom, and across Europe. After focusing our attention

on conquering the United States, we set our eyes on Asia-Pacic.

By 2008, we had a physical presence, and an impressive customer

list, on every continent.

Throughout this expansion, we always kept a local team in each of

the markets we work in. We think globally and act locally, pairing

a world-class product and industry-leading innovation with an

eye on the needs of each market, and a local team intimately

acquainted with their customers’ biggest challenges. This is just

one of the reasons we have been a trusted partner to many of our

customers across industries for more than a decade.

Over the years, we have been able to grow rapidly by staying

ahead of the technological trends that have shaped our industry.

As we grew our footprint around the world throughout the 2000s,

another seismic shift in the digital world was underway—the rise

of social media. Meltwater became one of the rst companies

globally to provide social listening solutions, and since then

has continued to tailor our product to adapt to the changing

20 Years of Meltwater

2001

2008

Online Media

Monitoring

Social Media

Monitoring

& Engagement

HIGHLIGHTS

2021 Annual Report 12

landscape and growing consolidation of today’s PR, Comms

and Marketing teams.

The past few years have seen signicant growth for Meltwater.

In 2020, we reached a signicant milestone, listing on the Euronext

Growth market before uplisting to Oslo Børs in 2021. Fueled by the

desire to rapidly accelerate our technology and provide adjacent

use cases for our customers, Meltwater completed 7 strategic

acquisitions in the last 5 years, including four acquisitions in

2021 alone.

Today, Meltwater is a global business with more than 50 oces,

2,200 employees, and 27,000 customers across six continents.

Remarkably, for more than a decade this growth was not based on

external capital, but only on cash ow generated from customers.

At the core of Meltwater’s success over the last 20 years are our

people, values and culture. At Meltwater, we have a fundamental

belief in people and the potential that they possess. We rmly

believe that when the right people are in the right working

environment, great things happen.

Our corporate values can be summarized by the Norwegian

word MER or more, which represents our commitment to

continuous improvement. We have high ambitions for the future,

a strategy to achieve 20% growth and 20% EBITDA growth,

the momentum to ensure our leading position in the market,

and the right people to get us there.

The future looks no less exciting than the past. There is an

exponentially increasing amount of data online, and Meltwater

provides the only all-in-one tool that solves for media and social

intelligence, media relations, and inuencer management, using

AI and machine learning to turn unstructured data into insights.

This allows our customers to stay on top of content and

conversations wherever they occur.

By building on our existing product oerings through investments

in technology and acquisitions, Meltwater will continue to dene

itself as the global leader in social and media intelligence.

2015

2016-2018

2021

Integrated PR/

Marketing Solution

Acceleration through

Acquisition

Uplisting to

Oslo Børs Exchange

2021 Annual Report 13

Letter from the CEO

2021 marked the rst year as a public company for Meltwater.

Despite a challenging environment with the ongoing COVID-19

pandemic, it is a year that I believe we can be proud of and

provides us with a strong platform for further growth in 2022 and

beyond. We exit the year o the back of much stronger organic

growth, having completed four acquisitions that both expand our

Total Addressable Market and enhance our technology stack, and

having successfully uplisted from the Euronext Growth Market to

the main market of the Oslo Børs.

At the time of our IPO at the end of 2020, the company clearly

communicated its ambition to grow its top line by 20% with

Adjusted EBITDA margins of 20% for the long term and the long-

term time horizon communicated as 3-5 years.

The pathway and strategy to achieve these goals has largely been

centered around a few key, strategic focus areas: increasing ARR

from premium customers, continuing to sell social products to

new and existing customers alike, improving Net Retention Rates

and complementing our organic growth with M&A. Our success

in these four areas over the last 12 months has created a stronger

underlying business, which leaves us well positioned to achieve the

long-term model that we have laid out.

ARR from premium clients grew by 36% in the year and now

represents exactly half of our overall ARR. These customers

continue to be the most protable for Meltwater and have the

highest retention rates, which is why our investments are focused

in this area. The success in this area has also helped to drive

a 17 point improvement in a customer’s average annual spend

with Meltwater.

ARR from social products grew by 55% and continues to be a

key dierentiator for the company in the market, helping us to

secure new logos and grow existing accounts across countries and

buying centers.

The success in these two focus areas is partly driven by much

improved Net Retention Rates across the customer portfolio, which

improved by 9 points from Q4 2020 to Q4 2021 on a trailing twelve

month basis.

One of the drivers for the initial listing was to be able to execute

on M&A and take advantage of opportunities to consolidate

the market. The acquisitions of Linkuence, Klear, Owler and

JOHN BOX / CEO

2021 Annual Report 14

DeepReason.ai were all completed in 2021 and provide Meltwater

with the opportunity to enter into exciting new spaces and use

cases such as consumer insights and inuencer marketing. Our

planned investment into Research & Development in 2022 will

accelerate the integration eorts from a technical standpoint

and unlock both revenue and cost synergies in both the short and

long term.

The company had always communicated its intention to uplist

to the main market of Oslo Børs within the rst calendar year

of its initial listing on Euronext Growth. As part of this process it

was necessary to migrate to International Financial Reporting

Standards as adopted by the EU (IFRS). The migration was not

without challenges, but we are pleased to have been able to

successfully complete this process in December 2021 and believe

both the uplisting itself as well as the accounting migration will

provide shareholders with improved visibility into the company’s

nancials and enhanced reporting from here on out.

Whilst we are conscious that the current external climate is

challenging, as the COVID-19 pandemic continues and the war in

the Ukraine shows no signs of ending imminently, the company is

in a strong position and has proven to be a remarkably resilient

business during tough times over the last two decades.

We enter 2022 with strong momentum within the business and see

ever-increasing market demand. The demand for social products

has never been higher, and Meltwater is uniquely positioned

to capture that demand. Our best-in-class, integrated solution

empowers over 27,000 customers to better understand, inuence

and engage with the world around them.

I would like to thank our sta, shareholders, board and customers

for all of their support during 2021 and into a new year. The team

and I are already working hard to ensure that 2022 is even more

successful than the prior year, as we look to execute on our plans

to drive further growth in the business, unlocking the obvious

potential for greater protability and shareholder value in the

coming years.

Our best-

in-class,

integrated

solution

empowers

over 27,000

customers

to better

understand,

inuence and

engage with

the world

around them.

2021 Annual Report 15

Our Solutions

Focus on

Innovations &

Enhancements

03

Expansion via

Acquisition &

Integration

02

Integrated

Oerings for PR,

Comms, Marketing

& Beyond

01

Key Areas

of Focus

Meltwater partners with over 27,000 customers in over

130 countries across all industries from tech to retailers,

pharmaceuticals to universities, NGOs, banks, governments

and much more.

With more information at the ngertips of consumers than ever

before, the world is drowning in data, and nding the information

that’s relevant for a particular organization is no longer able to

be done manually. At Meltwater, we help our customers better

understand, inuence and engage with their key stakeholders,

through a variety of dierent touchpoints in our product.

Our customers use Meltwater for a wide and growing range of

use cases, fueled by the world’s largest body of news and social

data and powered by our industry-leading technology and AI

platform, which ingests more than 800m pieces of new content

every single day from millions of content sources including open

web data, social channels, Wordpress and many more. This truly

global media scope, supporting customers in 120 countries with

113 distinct languages, enables Meltwater users to extract the most

from the world’s data.

Through our own incremental innovation, and by way of strategic

acquisitions and their subsequent integration, Meltwater is

expanding the amount of use cases supported by our product, to

continue to meet the evolving needs of our customers.

Historically, Meltwater’s most typical use cases have been in

media intelligence and media relations, as well as social listening,

analytics and management. Today, we see the convergence of

these two elds as social media becomes an intangible part of

a company’s public relations strategies. Meltwater is uniquely

positioned to meet the needs of today’s integrated PR, Comms

and Marketing teams with a single source of truth in one platform

designed for multiple use cases. Our intuitive all-in-one solution

enables collaboration, consistency in reporting, and consolidation

of vendors, so that our customers can get more of their work done

using Meltwater than ever before.

2021 Annual Report 16

Brand Management

Consumer Insights

Competitive Intelligence

Inuencer Marketing

Risk & Crisis Management

Sales Intelligence

Social Media Managment

Key Use Cases

Single Source of Truth

E-Commerce Integrations

Visulization Integrations

Collaboration Tools

News and Other Online Sources Social Media

One Integrated Solution to PR,

Communications & Marketing Use Cases

New Use Cases

2021 Annual Report 17

Integrated Oerings for PR, Comms,

Marketing and Beyond

Brand Management

Capitalize on the broadest data and most advanced AI in the

industry to surface strategic insights into your brand, and its

place in the industry you operate in.

Enabling users to:

Listen to external conversations about your company

and industry across all channels

Identify dierences between your messaging and

competitors to capitalize on what makes you unique

Share insights beyond traditional marketing teams,

to create a more integrated listening strategy

Competitive Intelligence

Gain competitive advantage over brands in your industry

by staying up to date on all their activity, identifying their

eective content and capitalize on the gap in their oerings.

Enabling users to:

Collate and identify eective content from your

competitors on social

Uncover business opportunities by leveraging customer

complaints or unmet needs

Easily report on your competitive share of voice scalably,

expanding into aspirational brands with unlimited topic

tracking

Risk/Crisis Management

Gain insights from the broadest set of external data, spanning

all forms of social and traditional media. Distribute and

analyze this content in real time through AI powered alerts,

and business integrations such as Slack and Teams.

Enabling users to:

Surface the right insights in real time via AI

Understand the drivers of conversations and crisis’

Share relevant insights and content with the right

stakeholders in their preferred channels

01

2021 Annual Report 18

01

Community Management

Amplify your community management eorts, by nurturing

loyal and inuential brand ambassadors. Understand audience

demographics, schedule content and analyze its impact, while

interacting with customers on their channel of choice.

Enabling users to:

Schedule and analyze content to optimize its impact

Build a community to advocate on your behalf

Manage earned and owned customer interactions

through one integrated platform

Campaign Management

Complete solution for campaign management to help

you plan, activate, monitor, engage and measure your

campaigns across social and news.

Enabling users to:

Build communities through one on one interaction,

driving brand loyalty

Track the performance of owned, earned & paid

content

Optimize your paid strategy via feedback loop

Market Intelligence

Understand the changes in the market you operate in to stay

ahead of the curve. Ensure you take advantage of market

gaps and are able to quickly react to shifts in the industry.

Enabling users to:

Expand into new areas of your market based

on unmet customer needs

Track individuals or topics that can trigger

changes in your industry

Audit and review your strategy to reex

the latest market trends

2021 Annual Report 19

01

Consumer Insights

Use online data as an instant focus group to understand

the wants, concerns, interests and buying behaviors

of your current or potential consumers.

Enabling users to:

Fully understand the needs and feedback

of your customers

Learn how your consumers dier from competitors

or other areas of the market you operate

Uncover opportunities for business improvements

and growth

Inuencer Management

Complete end to end solution for inuencer identication,

management and reporting to help you nd opinion leaders,

advocates, brand ambassadors, and content creators to

partner with.

Enabling users to:

Identify & vet relevant inuencers to work with,

maximizing ROI

Manage relationships through one centralized platform

Report on ROI & use data to rene future campaigns

Sales Intelligence

Access business news, data and insight on every company

in the world.

Easily nd and follow companies that matter to you,

including competitors and prospects

Get real-time alerts and daily emails about relevant

company and market news

Build personalized relationships through outreach

targeted to company revenue, sector, location, employee

count, public/private company status and more

2021 Annual Report 20

Expansion via Acquisition

and Integration

Meltwater has a proven track record of

integrating technology and functionality from

newly acquired companies into our agship media intelligence

product, having done this with Sysomos, Infomart, Encore Alert

and many more acquisitions over the years.

After the acquisitions of Linkuence, Klear, Owler and DeepReason.

ai in 2021, Meltwater’s product oering now spans far beyond

the use cases we have primarily served, and through deeper

integration, will give our customers a wider lens and more detailed

insights to help them inform and execute on their strategies.

Focus on Innovations

and Enhancements

02

03

Looking ahead, Meltwater’s key product objectives include:

Increased investment in R&D across dened

product focus areas

Continuing to leverage AI and data science

to better solve customer problems

Continuing to provide the most comprehensive

catalog of content and people proles

Ensuring all acquisitions are integrated,

supporting one platform for our customers

2021 Annual Report 21

Customer Testimonial / Shiseido

Shiseido is one of the largest and oldest beauty

companies in the world, with the brand and its

products present in over 120 countries. Before

Meltwater, Shiseido’s approach to consumer

insights was fragmented and disjointed. A number

of media intelligence tools were used by the

local teams and data was often inconsistent and

inaccurate. To consolidate eorts and provide the

leadership with a single source of truth, Shiseido

partnered with Meltwater to build a single global

framework for its luxury brands. Today, Meltwater

is Shiseido’s single source of truth for social and

media monitoring.

With Meltwater’s social management suite, they

are now able to capture, analyze and quantify

conversations across markets, languages and

channels. Strategic insights provided by Meltwater

enable Shiseido to streamline and strengthen their

communications, targeting the right audience

through the right channels. This powerful

collaboration is growing, with Shiseido beneting

from Meltwater’s innovative technology and

strategic vision, with both teams working hand-in-

hand to develop solutions to Shiseido’s needs.

Across the globe, the $400 billion

beauty industry is facing a lot of

disruptive challenges. Primarily, it’s

coming from the growth of digital and

social channels — and how important

they have become in creating a better

customer experience. This is where

Meltwater has helped us get closer to

our customers; not just from listening

to what they were saying about us, but

helping us monitor brand perception

and communicating to customers in the

channels they frequent in a way that

was more resonant.”

AMIT NAIK

Global Head of Analytics

2021 Annual Report 22

Customer Testimonial / World Animal Protection

World Animal Protection’s teams are based all

around the world, including Americas, LatAm,

Kenya, India and various locations in Europe, and

they partner with a local Meltwater representative

in each of these markets. WAP uses Meltwater to

track news and social media in real time, globally

and locally, and report on the eectiveness of their

campaigns.

With many of the team members often in the

eld, it’s important they have constant access to

data and the relevant news coverage. Meltwater’s

mobile app gives them the condence they’re

always in the know. The ongoing monitoring of

specic interest areas, including natural disasters,

farming and animals in the wild, gives WAP instant

access to news coverage they might have to

engage with. The ability to track and evaluate

key opinion leaders and themes means the

organization is able to use insights to guide their

future partnership and collaboration initiatives.

Finding key people who are right for the brand

is important, given the values and nature of

WAP’s business.

World Animal Protection has used the

media monitoring services of Meltwater

for a number of years now. As an

organisation with oces in 14 countries,

it was important to us that we receive not

only a high level of media monitoring,

but that we also had a high level of

customer service. We have account

managers in each of our country oce

locations to address the individual

enquiries and requests for each of those

oces. This means that they receive

help and assistance promptly, in their

own time zone. This can make all the

dierence to a global organisation.”

BEV BOYLE

Global Head of Media

2021 Annual Report 23

Customer Testimonial / Brut

Brut is a French digital media company. A rst of

its kind, their ethos of a value-driven video and

audio storytelling has earned them fans around

the world. The company depends on Meltwater’s

social marketing suite to guide their editorial

choices and content strategy.

Brut’s video stories are designed to reach specic

communities and Meltwater’s audience insights

solution plays a crucial role in understanding

where and how these groups engage with content.

The real-time monitoring and analysis capabilities

allow the team to assess and select subjects most

likely to resonate with the target audience, and

maximize both reach and engagement.

This consumer-rst, data-driven approach

contributed to the business’ global expansion

and new business.

Our partnership with Meltwater enables

us to grow as a business, globally. Our

innovative business model is based on data

analysis and insight that comes from that

research. Everything we do is guided by

data. This means we stay competitive and

relevant in the constantly-evolving media

market. Meltwater’s social marketing solution

enables my team to truly understand what

topics currently drive engagement and who,

within our target audience, is leading related

conversations. This powerful insight guides

our strategy, from deciding which story

to pursue, its language, tone of voice and

focus, through to pitching and winning new

business. You simply can’t argue with data.”

PAUL TARSIGUEL

Lead Data Analyst

2021 Annual Report 24

Customer Testimonial / Warner Music Group

Warner Music Group is a multinational

entertainment and record label business. It’s one

of the “big three” recording companies and the

third largest in the global music industry. The

company requires constant real-time access to

online conversations featuring mentions of topics

of interest.

Meltwater provides Warner Music Group with

data which is turned into actionable insights

when it comes to customer engagement. From

marketing campaigns to brand reputation, the

marketing teams design their strategies based on

Meltwater insights, and measure their success with

the comprehensive analytics and benchmarking

capabilities. Warner Music Group uses Meltwater’s

inuencer marketing solution to identify and

manage partnerships which drive brand awareness

and perception amongst key target audiences.

Carol Chu

Director of International Marketing

The evolution of the music industry

requires us to be agile and proactive in

seeking the right opportunities. Meltwater

is a comprehensive platform that oers

excellent customer support and solid

infrastructure, which allows us to extract

relevant information anytime, anywhere.

Our company uses four services from

Meltwater: Explore, Engage, Klear and

Audiense. The insights obtained via

these four services are helpful and

sucient enough to give our marketing

team condence in building campaigns,

managing brand perceptions, engaging the

right KOLs and benchmarking results. This

additional insight is something we greatly

appreciate!”

2021 Annual Report 25

Customer Testimonial / Truecaller

Truecaller is a leading global caller ID and call

blocking app. With over 300 million monthly active

users, the application is the go-to app for Caller

ID and spam blocking. In Q4 2021, the company

initiated trading on Nasdaq Stockholm. This,

coupled with their impressive growth strategy,

meant they needed to streamline and consolidate

their ap- proach to PR & Marketing.

On top of the traditional media monitoring,

Truecaller added consumer-centric services to their

Meltwater solution, including social media listening

and management. The new approach enables

the business to identify and prioritize consumer

needs, and turn this feedback into a proactive

communications strategy. With structured and

consolidated data, both regional and global

stakeholders get access to relevant and accurate

analytics in one integrated platform. The teams

are able to collaborate and coordinate eorts,

ensuring their users experience the same level of

service no matter the location.

As part of our expansion plans and recent

public listing, we have expanded our current

partnership with Meltwater beyond traditional

news monitoring and analysis, to now also

serve areas like social listening, consumer

insights and social media management with

Meltwater’s unied global solution. This helps

us to better understand our users’ needs and

more eciently communicate with them. The

new solution will initially be used across the

Swedish and the Indian teams across PR,

Marketing and customer success, with a very

strong focus on further global expansion.

Meltwater is a very suitable global partner

on this journey due to our industry-leading

global news and social media footprint in one

integrated oering.”

Agnes Adolfsson Lindberg

Brand Marketing Manager

2021 Annual Report 26

People & Culture

At Meltwater, our culture is our north star, and our company

values are the foundation of everything that we do.

They are four Norwegian words that translate (loosely!)

as follows:

& taken together,

Which represents our commitment

to continuous improvement.

These aren’t just words on our website. Our ambition is

to live and breathe these values, so that they are evident

to everyone we interact with — our employees, partners,

customers, and shareholders. The world is far from a

perfect place, we believe that by showcasing these values

in all that we do, then we can do our part to improve it.

Moro [‘mo(·)ro] — “ Fun ”

Awards & Recognition

Ener [‘e nðr’e] — “ Number One ”

Respekt [re’spekt] — “ Respect ”

Mer [mer] — “ More ”

2021 Annual Report 27

Our People

At Meltwater, people are central to everything we do. Attracting

and retaining world class talent is one of our key focuses, and

the foundation of our success over the years. Together, we push

ourselves to deliver best-in-class solutions for our customers and

challenge ourselves on the innovation required to stay ahead.

We are proud to have a diverse employee base of over 2,200

employees in 50 locations in over 20 countries on 6 continents.

Our employees speak over 50 languages and support our

customers in more than 130 dierent countries.

Meltwater is proudly an equal opportunity employer and is rmly

committed to aording equal employment opportunities to all

candidates and employees alike without regard to race, color,

religion, age, national origin, gender, sexual orientation, gender

identity or gender expression, marital status, disability, or veteran

status. Women make up 50% of the employee base at Meltwater,

with 42% of leadership positions lled by women, well above

industry average.

Hear from Meltwater Employees

95%

95% of employees say they

are proud to be a part of

Meltwater

91%

91% of employees say

that they are invested in

Meltwater’s goals

94%

94% of employees say that

they approve of the job the

executive team is doing

83%

83% of employees say that

Meltwater provides them with

meaningful opportunities for

career advancement

98%

98% of employees say

that they look forward to

interacting with coworkers.

Employee

Feedback

The Meltwater Leadership team

genuinely cares about my personal

development. They’re always open to

receiving feedback and acknowledge

areas of improvement. I feel valued and

rewarded at Meltwater.”

The culture is incredibly positive. There

are always new challenges and our work

is team-focused, so when one

of us wins, we ALL win!”

Working at Meltwater has given me

a deeper belief in myself and more

condence when facing challenges.”

2021 Annual Report 28

Corporate Responsibility

Sustainability at Meltwater

As a global company with more than 2,200 employees and

27,000 clients, we have a responsibility to conduct business

in a way that has a positive impact on people, the planet and

society as a whole. This is part of our commitment to continuous

improvement— one of our four company values— to consistently

re-examine our policies and programs and ensure that we are

making strides to create a more sustainable and equitable world.

ENVIRONMENTAL SUSTAINABILITY

Protecting our planet

We believe that environmental sustainability is one of the most

pressing issues of our day. Our daily choices and the choices

we make as a business have an impact on our planet and the

resources we have available.

We know that sustainability is important to many of our

employees, as well as our customers, prospects and investors.

But it is also just the right thing to do. We have a responsibility

as a company and individuals to positively contribute to

our environment and to create a better platform for future

generations.

Reducing our environmental footprint

Careful consideration for the environment and our planet is in

our very DNA. The rst server farms of Meltwater were made

from recycled computers destined for the landll, and we were

disrupting an industry by providing an electronic, online solution

to something that had been paper based for well over a century.

Meltwater is committed to evaluating and improving our

environmental performance, providing our customers with

paperless business intelligence solutions, preventing pollution by

Governance

Social

Environmental

GOALS FOR 2025

100%

of oces involved in green

initiatives

100%

of e-waste recycled or

donated

0

Waste commitment across

the organization

2021 Annual Report 29

striving to use teleconferencing facilities instead of promoting

travel, and complying with all environmental legislation,

regulations and codes of practice relevant to the industry sector

in which we operate.

We include environmental factors in our decision making process

for vendors, partners, and suppliers. We are proud to partner with

AWS as our cloud-vendor today, a company that has committed to

powering their operations with 100% renewable energy by 2025.

Global Green Council

These actions are just the start. Meltwater has

created a Global Green Council for employees

with a background and passion in environmental

sustainability to develop policies that will lessen the

impact we have on the environment as a company.

The council leads the conversation and education

around sustainability, creating a shared model of

responsibility where Meltwater leaders and global

teams are considering climate change impact

when making business decisions and involved

in ongoing conversation and education about

environmental issues.

SOCIAL IMPACT

Putting People First

At Meltwater, people are central to everything we do. This

philosophy extends to our employees, customers, investors,

partners, suppliers, and the communities in which we operate. By

harnessing our people, products, and resources, we are committed

to being a force for good in the places where we live and work. We

believe in the power of people and technology to have a positive

impact on the future, and in building a diverse, equitable and

inclusive organization to fuel innovation and sustainable growth.

Our culture and values extend to our work across DEI, employee

engagement, philanthropy and community partnerships, and we

are committed to continuous improvement in all of these areas.

Diversity, Equity & Inclusion

Creating a diverse, equitable and inclusive organization is a key

focus for Meltwater. Our DEI eorts are organized around key

objectives including training & education, recruiting, inclusive

culture and leadership diversity and accountability.

KEY FIGURES

$25m+

dollars in charitable

contributions to date

50%

of the employee base

are women

42%

of leadership positions

are filled by women

2021 Annual Report 30

Meltwater supports a number of employee-led Anity Groups who

drive inclusion and education across the organization.

mPowered is Meltwater’s multi-cultural anity group with

chapters in the Americas and Australia. mPowered promotes

inclusion through discussion, education and advocacy. The

group provides a forum for employees to discuss issues that

aect underrepresented groups and strives to create a culture

where employees feel their voice is heard, their opinions

are valued, and that they can be a part of positive change.

The group has held numerous DEI workshops, trainings, and

speaker sessions since its inception in 2020.

The EMEA DEI Council is an employee-led task force that

works on market-specic initiatives across the region to foster

education, discussion, and advocacy on DEI issues. The

council has rolled out trainings and leadership sessions across

the region on topics such as cultural sensitivity, diversity-

based business coaching, and more.

The Women in Tech Initiative is a global community

spanning all regions at Meltwater which invites in industry-

leading speakers and creates an environment to share ideas,

discuss topics that genuinely matter and build a mutual

learning exchange. The initiative has seen speakers from Coca-

Cola, Nike, and Google, and is led by a team of ambassadors

spanning the globe.

Philanthropy

Meltwater regularly partners with nonprots in the markets in

which we work to volunteer and address the needs of the local

communities that we operate in. Employees partner with local non-

prots through volunteer days, and the company makes corporate

donations to nonprots with missions that are important to our

teams around the world. This is in addition to the $2.5 million

that is given as annual funding to the Meltwater Foundation

supporting MEST.

Continuous Improvement

These are some of the ways that Meltwater shows a commitment

to our people and those in our communities, but we are also

committed to continuous improvement and expanding these

programs in order to have a greater impact. Meltwater conducts

an annual Employee Engagement survey to benchmark

employee sentiment around key issues and track where we are

doing well and where we can still improve, with action plans

to build strategies and programs that will impact these areas

going forward.

Meltwater chooses

corporate sponsorships

that are in line with

our own values and

philosophy. Since 2021,

Meltwater has been

the title partner of the

Meltwater Champions

Chess Tour, in partnership

with the Play Magnus

Group. Play Magnus

Group’s mission is to

promote chess and chess

learning that fosters

positive social outcomes.

They accomplish this

through training and

education, supporting

chess in schools,

advancing gender

equality, supporting

aligned non prots and

promoting tolerance,

inclusion and respect.

Meltwater actively

supports PMG in this

work through activations,

employee participation

and sponsorship.

SPONSORSHIPS

2021 Annual Report 31

GOVERNANCE

Ensuring Accountability & Oversight

As Meltwater continues to grow, we are committed to running our

business responsibly, ethically and in line with all regulations in

the markets we serve. Governance to us means a dened board

structure, diverse perspectives on our board, an established

compliance team, and a robust data privacy program.

We believe that sound corporate governance is crucial for

Meltwater’s success and set high standards for our Executive

Leadership Team and Board of directors. We are committed to

maintaining an independent and diverse Board of directors.

Our Board members bring together a diverse set of skills and

experiences from dierent industries and markets. The Company

has a one-tier board structure consisting of one executive director

and ve non-executive directors elected by the Company’s

shareholders, on the binding nomination of the Board of directors.

Board Committees

Meltwater’s Board committees serve to prepare the Board of

directors’ decision-making and to render advice to the Board.

Audit committee

The audit committee supports the Board of directors in the

exercise of its management and supervisory responsibilities

relating to nancial reporting, statutory audit and

internal control. The audit committee reports and makes

recommendations to the Board of directors, but the Board

of directors retains responsibility for implementing such

recommendations. The composition of the audit committee

fullls the required qualications and competence in

accounting and auditing under Dutch law.

Remuneration committee

The remuneration committee is charged in particular with

the preparation of the remuneration policy for the Board of

directors; proposals for the remuneration of the directors; and

the remuneration report on the execution of the remuneration

policy, included in the Company’s annual accounts.

At Meltwater, our customers

are at the heart of our

business, which means that

safeguarding customer

data is a priority for the

Company. Meltwater

supports more than 27,000

customers in more than 130

countries. Our clients include

industry leaders across

sectors in government,

tech, healthcare, consumer

goods and nance, to

name a few, and protecting

the information that our

customers entrust to us is one

of our key responsibilities.

Meltwater trains employees

annually on topics such

as data privacy and

cybersecurity awareness,

with additional secure

coding training for R&D

team members. The

training ensures that

Meltwater employees have

the knowledge to keep

Meltwater’s customers’

and partners’ data safe.

We use and develop new

technologies with privacy

considerations and also

maintain the necessary

level of security, privacy,

and data protection

in compliance with

applicable laws.

DATA PRIVACY

KEY FIGURES

5 50% 67%

of Meltwater’s Board

is diverse in terms

of gender or race

of Meltwater’s Board

is independent from

the Company and its

main shareholders

nationalities

represented

on the Board

2021 Annual Report 32

MEST

In 2008, Meltwater’s founder Jørn Lyseggen founded MEST based

on the principle that “talent is evenly distributed, but opportunity

is not.”

Leveraging our core strengths as an innovation leader, Lyseggen

chose to invest in innovation on the African continent, an area of

the world that historically has been underserved and underfunded,

and launch a technology training program to fuel the next

generation of African entrepreneurs.

MEST, the Meltwater Entrepreneurial School of Technology, is an

Africa-wide technology entrepreneur training program, internal

seed fund, and network of hubs oering incubation for technology

startups in Africa.

Founded in Ghana in 2008, MEST provides critical skills training,

funding, and support in software development, business, and

communications to Africa’s tech entrepreneurs. Hubs are located

in Accra, Ghana; Lagos, Nigeria; Cape Town, South Africa; and

Nairobi, Kenya. MEST is funded by the Meltwater Foundation,

Meltwater’s non-prot arm.

Talent is

evenly

distributed,

opportunity

is not.

Jørn Lyseggen

Founder, Meltwater and MEST

2021 Annual Report 33

For young aspiring and established African entrepreneurs,

MEST Africa provides the skills, mindset, and experiences to

build a globally successful tech company. Beyond tech and

entrepreneurial skills training, MEST Africa provides a real-

world advantage to entrepreneurs through funding, business

incubation, and access to a global tech network.

Training Program

Providing skills in tech entrepreneurship to aspiring

entrepreneurs with a fully-funded, one year full-time

graduate level program in software development

and business.

Incubation & Seed Fund

Supporting graduates of the MEST Training Program

to launch early-stage startups with seed funding

between $50k-$250k, incubation, and access to a global

tech community.

African Tech Community

Our tech community of leading entrepreneurs, investors,

corporate partners and ecosystem players spans

across the continent. Members of MEST have access

to our network, and to one another, as they grow

their companies.

Portfolio

80+

software companies tackling Africa’s

biggest problems across industries

MEST has launched numerous successful startups that have

gone on to receive follow-on funding and admission to the

world’s top tech accelerators, has hosted guest lecturers from

Fortune 100 companies, and counts Mastercard Foundation,

Microsoft, and 500 Startups among its partners.

IMPACT

$2.5m

USD given by Meltwater to MEST

in annual funding each year

750+

jobs created through

MEST programs

500+

people trained

30

countries reaches

80+

businesses funded

2021 Annual Report 34

Director’s Report

Meltwater N.V. (the “Company”) is a public company with limited liability

(naamloze vennootschap) incorporated under the laws of the Netherlands, with

its registered oce at Singel 250, 1016 AB Amsterdam, the Netherlands. The

registration number of the Company at the Chamber of Commerce is 32109376.

The Company’s shares are listed on Oslo Børs (the Oslo Stock Exchange), a

regulated market operated by Oslo Børs ASA since 20 December 2021 (ISIN:

NL00150003D3). Before that, the Company’s shares were listed on Euronext

Growth Oslo, a multilateral trading facility since 3 December 2020.

The Company and its subsidiaries (the “Group” or “Meltwater”) help

businesses drive growth and build brands. Meltwater’s online intelligence

platform analyzes billions of digital documents daily to extract precise,

timely business insights that help more than 27,000 companies understand

their markets, engage their customers, and master the new social business

environment. With 50 oces across 6 continents: Europe, North America, South

America, Asia/Pacic, Australia, and Africa, Meltwater is dedicated to personal,

global service built on local expertise. The principal business activities generate

revenue through one operating segment namely Media Intelligence. The revenue

geographical split is disclosed under note 22 of the annual consolidated

nancial statements. These geographical areas are also representative of the

customers and suppliers’ geographical areas.

2021 Annual Report 35

Strategy and long-term value creation

On 19 November 2021, the Company held its rst Capital Markets Day. The Board’s strategy and long-term

vision were clearly formulated that day: provide global clients with an integrated platform for a variety of

use-cases, including to handle their public relations management and social media and marketing. The

public relations management of clients is supported by eciently monitoring and analyzing all global,

online news content for news and updates on their brand, competitors, industry, trends etc. In addition to

that, Meltwater oers social media and marketing solutions that help customers to understand, monitor

and manage their business’ or organization’s social media footprint, i.e. what people are saying about

them in social media channels. To properly monitor and inuence, companies and organizations must

keep track of and interact with their audience on relevant social media channels such as Facebook,

Twitter, Instagram, Snapchat, LinkedIn, YouTube and Reddit. Furthermore, companies increasingly

embrace new marketing channels, like marketing through social media inuencers. Through Meltwater’s

software, customers can identify, approach, monitor and analyze the outcome from their social media

activities.

Meltwater’s overall strategic objective is to continue sustainable global market leadership through

Meltwater’s strong track record of acquisitions and organic growth. To ensure long-term protability,

the Board of Directors believes it is important to invest in innovations. The Group’s software development

activities are invaluable to sustain competitive dierentiation. The Group invests signicant human and

monetary resources to improve its existing software oerings, integrate acquired products, and design

and develop new valuable and innovative services and features that meet the demand of the global media

monitoring market. The Group currently has a signicant pipeline of research and development projects

and has concluded many similar research and development projects in the past. The outcome of such

research and development projects are a key factor to implement the Group’s long-term strategy, as such

projects may open up new markets for the Group to sell its services.

Culture and core values

Guided by its core values, Meltwater’s culture is based on a fundamental belief in people and the

potential they possess. Meltwater is not afraid of investing in hidden talent and believes that in an

environment where people are motivated and supported by their colleagues, individuals will discover their

strengths.

Meltwater is also a company built on an entrepreneurial spirit, hard work and the joy of accomplishment.

Meltwater values teamwork, as well as individual excellence. At Meltwater, passion and personability is put

into everything it does.

Meltwater’s values are at the core of its culture, and they can be summed up by the acronym MER, which,

in Norwegian, means “more.”

Moro [‘mo(·)ro]

Norwegian for “Fun.” Meltwater believes that in order to become successful, individuals must enjoy what

they do. That is why Meltwater promotes a fun and supportive working environment.

Enere [‘e nðr’e]

Norwegian for “Number One.” At Meltwater, average isn’t good enough. Its goal is to create a company

that is ground-breaking and a culture in which employees aspire to exceed their personal expectations.

Respekt [re’spekt]

Norwegian for “Respect.” Meltwater believes it matters how a company or an individual becomes number

one. When striving to be the best, individuals must treat their colleagues and customers with respect and

humility.

2021 Annual Report 36

MER

An acronym for Moro, Enere and Respekt. At Meltwater victories are celebrated, but the need is also seen

to continuously improve – whether it is to reach personal goals or corporate milestones. Though these

values may seem simplistic on the surface, they are what drives Meltwater to reach its objectives, claries

its expectations, and helps to prioritize and make decisions.

History

From the humble beginnings, Meltwater was built from scratch, brick by brick. The Group was founded

in 2001 with just $15,000, a trusty coee machine, used furniture and a borrowed oce space in Oslo at

an aptly named address, Shack 15. Armed with experience from a two-year computer science research

program in cooperation with the Norwegian Computing Center and funded by the Norwegian Science

Foundation, Meltwater’s founder, Jørn Lyseggen, and his business partner set out to introduce game-

changing technology for the traditional press clipping market. The duo’s previous work in the eld of

Internet agents and search technologies provided a strong foundation for the development of Meltwater’s

initial product: Meltwater News.

Technology and core services

Meltwater is a global SaaS provider specializing in productivity solutions. It develops high quality software

solutions at a reasonable price. Meltwater focuses on well-dened pain points and solves them better

than anyone else. Meltwater’s SaaS solution helps drive eciency, reduce costs and improve its clients’

bottom line. Today, Meltwater oers solutions that enable businesses to manage their reputation, target

the right journalists, collaborate more eectively, streamline their hiring processes, and manage their

online marketing campaigns. During the past years, Meltwater marketed and sold its products under

multiple product oerings. The products and services oered by the Group enable PR & Communications,

Marketing, Executives and Enterprise act on data from the outside.

PR & Communications centric products help quantify PR impact, bring insights from conversation share to

brand sentiment, discover key inuencers, and create relationships and quickly create presentation-ready

reports for the stakeholders.

Marketing centric products help understand brands through the eyes of target audiences across the

world, optimize social marketing eorts, benchmark marketing eorts against the competition and

discover who’s talking about brand, from earned media to authentic conversations.

Executives centric products help reduce risk without complexity by leveraging AI to stay on top of

nancial, market and competitive information.

Enterprise products help in mapping strategy to competitive environment, automate workows into

custom systems, manage ow of outside information and assist with internal collaboration with external

insights.

Organization structure

The group structure is presented under note 30 in the annual nancial statements.

2021 Annual Report 37

Code of conduct

The Group’s highly international operations, with over 27,000 clients and 2,200 employees in 50 oces

across 6 continents, requires the Group to comply with the laws and regulations of various jurisdictions.

In particular, the Group’s international operations are subject to anti-corruption laws and regulations,

such as the U.S. Foreign Corrupt Practices Act of 1977 and the United Kingdom Bribery Act of 2010, and

economic sanctions programs, including those administered by the United Nations, the EU and the U.S.

Oce of Foreign Assets Control. These anti-corruption laws and regulations comprehensively and, in

some cases in diering ways, cover many forms of public and private corruption.

As part of its business, the Group may deal with both governments and state-owned business enterprises,

the employees of which are considered foreign ocials for purposes of the U.S. Foreign Corrupt Practices

Act of 1977 and other applicable anti-bribery laws and regulations. Economic sanctions programs restrict

the Group’s business dealing with certain sanctioned countries, and new sanctions programs may be

imposed, or existing sanctions programs revised in unpredictable ways, depending on circumstances

outside of the Group’s control.

In line with the Dutch Corporate Governance Code, Meltwater has a code of conduct, which is published

on the Company’s website. Businesses in our group apply zero tolerance to violations of the code of

conduct. Although Meltwater is occasionally confronted with less desirable behaviors, the Board of

Directors considers the code of conduct to be eective. Appropriate action is taken, including disciplinary

procedures or improving the control environment to mitigate such occurrences in the future.

Meltwater is committed to conducting its business on the basis of complying with the law, with integrity

and with proper regard for ethical business practices. All directors and employees are expected to comply

with these principles and, in particular, to avoid conicts of interest and not to engage in insider trading,

illegal anti-competitive activities, and bribery and corruption.

Internal control systems

Meltwater’s system of internal controls in all material subsidiaries aims to prevent or detect risks

materializing and to mitigate any adverse consequences. The system provides reasonable assurance

on achieving company objectives. This includes the integrity and reliability of the nancial statements,

safeguarding and maintaining accountability of its assets, and to detect fraud, potential liability, loss

and material misstatements while complying with regulations.

Management, with assistance from risk and audit, regularly reviews risks and the design and operating

eectiveness of internal controls. The Board reviewed the eectiveness of controls on key risks for the year

ended 31 December 2021. This assurance was obtained principally through a process of management

self-assessment. Consideration was also given to other input, including reports from risk and audit,

compliance and the risk management process. Based on the evaluation, we concluded that, as of 31

December 2021, certain controls and procedures were ineective. Such conclusion is due to the presence

of material weaknesses in internal control over nancial reporting. The Company has developed and is in

the process of implementing a remediation plan to address these control deciencies, which will address

the underlying causes of material weaknesses.

2021 Annual Report 38

Financial review

Revenue

Revenue from contracts with customers for the year ended 31 December 2021 was $401.6 million compared

to revenue from contracts with customers for the year ended 31 December 2020 of $359.8 million. The

increase of $41.8 million, or 11.62%, in revenue from contracts with customers compares favorably to the

year ended 31 December 2020 which saw an increase of $14.0 million or 4.05% versus the year ended 31

December 2019. The increase from the organic core business was $26.1 million or 7.25%. The balance of

the increase was from revenue contracts from the acquisition of Klear.com Ltd., Linkuence SAS and Owler,

Inc. which was $15.3 million. The growth in revenue was the result of the company’s strategic focus on the

premium client market and growth in sales of its social products. The premium client annual recurring

revenue grew 36% in 2021. This growth increased the company’s average revenue per customer by 16.66%

to $16.334 (December 2020: $14,001). Annual recurring revenue of social products increased 55% in 2021.

The strategic shift to these growth areas helped to improve overall net retention from 86% for the year

ended 31 December 2020 to 95% for the year ended 31 December 2021.

Cost of sales

Full year 2021 cost of sales increased YoY by $14.2M and 13.46%. $9.4 million of the increase in spend

is associated with an increase in content ($7.0 million) which is attributable to contract increases with

content partners and hosting ($2.4 million) because of increased service utilization. The remaining $4.8

million is related to increased labor costs to support the upshift in sales volume. Within the cost of sales

expenses an amount of $9.1 million is included which pertain to the acquired businesses Overall Cost of

Sales as a % of revenue increased by 0.49% from 29.32% to 29.81%, respectively.

Sales and marketing expenses

Meltwater began reinvesting back into Sales & Marketing in the late stages of 2020, after reducing

headcount and cost during the height of the pandemic in April 2020. The investment has predominantly

been into sales headcount, to take advantage of strong market demand and to accelerate top line growth.

The Meltwater sales organization is predominantly in 3 key areas: Retention (Customer Success, renewal

focus) Newbiz (Customer Acquisition, new logo) and Upsale (upselling and cross selling more seats

and modules to existing clients). Increased headcount in Retention roles has primarily been focused on

Premium accounts and positively contributed to the improved retention rates.

Headcount in sales is still lower than pre-pandemic levels after the cutbacks made in April 2020 and

the revenue growth has accelerated in 2021. This highlights the improved productivity from the sales

organization and success of the focus on the Premium segment.

Full year 2021 sales and marketing costs increased YoY by $43.4 million and 24.41%. $35.3 million is

primarily associated with sales labor costs, of which the majority is related to stock-based compensation

and employee buy-back expense. The remaining $8.0 million consists of $3.8 million in Outside Services,

$1.4 million in marketing expenses, and $2.8 million in other costs. Within the total sales and marketing

expenses an amount of $9.8 million is included which pertain to the acquired businesses. Overall sales

and marketing costs as a % of revenue increased by 5.65% from 49.42% to 55.07%, respectively.

General and administrative expenses

Full year 2021 General & Administrative costs increased YoY by $29.0 million and 56.20%. $12.4 million of

the increase in spend is associated with Labor costs, of which $11.0 million is stock-based compensation

and employee buy-back expense, $2.2 million is increase labor costs from the acquisitions, oset

by $0.8 million decrease in non-acquisition headcount costs. $11.5 million of the increase in spend is

outside services. And the remaining $5.0 million in other costs. Within the general and administrative

costs an amount of $4.8 million is included which pertain to the acquired businesses. Overall General &

Administrative costs as a % of revenue increased by 5.71% from 14.34% to 20.05%, respectively.

2021 Annual Report 39

Research and development

Meltwater continues to invest in research and development activities that complement existing product

lines and new products. The Group’s software development activities are invaluable to sustain its current

growth momentum and competitive dierentiation. The Group invests signicant human and monetary

resources to improve its existing software oerings, integrate acquired products, and design and develop

new valuable and innovative services and features that meet the demand of use cases (Media Intelligence,

Media Relations, Social Listening & Analytics, Social Media Management, Consumer Insights, Inuencer

Marketing, Sales Intelligence) we are catering towards. The Group currently has a signicant pipeline of

research and development projects and have concluded many similar research and development projects

in the past. The outcome of such research and development projects are a key factor for the Group, as

such projects may open new markets for the Group to sell its services.

The software development function is truly globalized, but most development resources are grouped

together in San Francisco, Raleigh, and Manchester NH in the USA, as well as key European development

centers in London, Goteborg, Berlin, & Budapest. The Group’s software is designed, coded, tested, and

supported by the Group’s own employees and external consultants.

Full year 2021 Research & Development costs increased YoY by $20.4 million and 53.68%. The overall

net increase is primarily due to a $17.8 million increase in labor costs, of which $15.3 million is stock-

based compensation and employee buy-back expense, $4.6 million is increased labor costs from the

acquisitions, oset by $2.1 million decrease in non- acquisition headcount costs. Within the total Research

& Development costs an amount of $6.6 million is included which pertain to the acquired businesses.

Overall Research & Development costs as a % of revenue increased by 3.98% from 10.55% to 14.53%,

respectively.

Other income

Other income for the year ended 31 December 2021 was $0.016 million compared to other income for

the year ended 31 December 2020 of $0.042 million. The decrease of $0.026 million, or -61.90%, in other

income was mainly due to decreased income from employee benet plans.

Finance costs

Finance costs for the year ended 31 December 2021 was $4.9 million compared to nance costs for the

year ended 31 December 2020 of $60.8 million. The decrease of $55.9 million, or -91.94%, in nance

costs was mainly due to full repayment of the long-term loan per December 2020. The long-term loan

was interest bearing and as such the 2020 gures contained signicant interest expenses. Following the

repayment of the loan per December 2020 the long-term debt as at that date amounted nil. In 2021 new

borrowings of $25.0 million were attracted. On average the interest-bearing debt levels have signicantly

decreased, and interest expenses decreased accordingly.

Foreign exchange gain/loss

Foreign exchange gain for the year ended 31 December 2021 was $5.5 million compared to foreign

exchange loss for the year ended 31 December 2020 of $5.5 million. The decrease of $11.0 million, or

-200.00%, in foreign exchange gain/loss was mainly due to exchange results on transactions and

positions held in Euro (EUR), Australian Dollar (AUD), Swedish Krona (SEK) and Swiss Franc (CHF).

Finance income

Finance income for the year ended 31 December 2021 was $0.4 million compared to nance income for

the year ended 31 December 2020 of $3.9 million. The decrease of $3.5 million, or -89.74%, in nance

income was mainly due to repayment per the end of 2020 of related party receivables of $30.9 million, for

which interest income was received during the rst half of 2020. Since the balance amounted nil as of 31

December 2020 no interest was charged in 2021.

2021 Annual Report 40

Income tax expense

Income tax expense for the year ended 31 December 2021 was $0.8 million compared to income tax

expense for the year ended 31 December 2020 of $0.6 million. The increase of $0.2 million, or 33.33%,

in income tax expense was mainly due to deferred tax adjustments for share-based compensation and

temporary adjustments arising due to timing dierences for depreciation and amortization expenses.

Loss before tax

Loss for the year ended 31 December 2021 was $77.2 million compared to loss for the year ended 31

December 2020 was $75.4 million. The increase in the loss was $1.8 million, or 2.39%. The operating

expenses increased mainly due to higher FTE levels in 2021 and expenses related to employee share-based

payments. The increase in expenses is oset against the increase in gross prot from general operating

activities as a result of increased performance in the Media Intelligence market in several geographies,

and a strong reduction in nance costs following the repayment of debt per the end of 2020 that

decreased interest expenses. Also, the movement in 2021 is the result of completed business acquisitions

during the year following which revenue and expenses of the acquired companies are included in the

consolidation.

Financing and liquidity

In December 2020, the Company entered into a multi-currency revolving credit facility (the “2020 Credit

Facility”) of $150.0 million. The maturity date of the 2020 Credit Facility is three years from when the rst

utilization occurs with an option to extend an additional one to two years. Interest accrues on amounts

outstanding under the 2020 Credit Facility at LIBOR plus a margin range of 1.50% to 2.00% per annum.

The Company is required to meet certain covenants in relation to the 2020 Credit Facility. The covenants

mainly related to the achievement of a nancial leverage ratio. As of 31 December 2021, the Company had

drawn $25.0 million under the 2020 Credit Facility and had the ability to borrow $150.0 million under the

2020 Credit Facility.

The outstanding amount is wholly due and payable by 9 June 2025. All covenants were met in 2020

and 2021.

Meltwater’s nancing needs relate to strategic growth through acquisitions, where it leverages o the

positive equity position.

On 31 December 2021 the Company had cash and cash equivalents of $44.4 million (2020: $100.0 million).

The Company has robust liquidity to operate and execute its business plans.

Solvency and liquidity ratios

RATIO 2021 2022

Debt-to-equity ratio -9.61 -10.84

Debt-to-asset ratio 1.12 1.10

Interest coverage ratio 14.86 0.24

Equity ratio -0.12 -0.10

The debt-to-equity ratio remained negative in 2021 but stable due to an increase in both total liabilities

and a negative equity amount. The debt-to-asset ratio remained stable during 2021 in comparison to

2020 due to the proportionally similar increases in both assets and liabilities. The interest coverage

ratio increased due to the loss on loan extinguishment in 2020 on which the loan was settled in the

aforementioned year and was thus not applicable in 2021. The equity ratio is stable and negative in 2021

and 2020.

2021 Annual Report 41

Refer to note 1 in the consolidated nancial statements where further details on the going concern and

liquidity have been set out.

Cash ow

The Group’s cash inow from operating activities totaled $7.1 million compared to a cash inow of $34.6

million for the full year 2020. Cash outow from investing activities totaled $63.5 million compared to the

cash inow for $15.3 million for the full year 2020. This was primarily due to the acquisitions done in 2021

and the $28.1 million related party loan received in 2020. The Group’s cash inow from nancing activities

totaled $1.8 million compared to the cash inow for $33.3 million for the full 2020, the decrease in 2021

is driven by the repurchase of share in 2021 while increase in 2020 is driven by the proceeds received in

2020 from the Euronext Growth Oslo oering.

Capital expenditure

The Company capitalized $12.3 million and $12.0 million of development costs related to software during

the years ended 31 December 2021 and 2020, respectively. Of the amount capitalized, $0.2 million and

$1.4 million was related to interest in 2021 and 2020, respectively. Any costs associated with research are

expensed as they arise, and only identiable development costs are capitalized.

Many of the development costs related to software stem from the acquisition of companies. Meltwater

also acquires intellectual property rights through acquisitions, such as customer relationships and

developed technologies.

Mergers and acquisitions

In April 2021, the Company completed the acquisition of Klear.com Ltd. The total consideration for the

acquisition of Klear.com amounted to $17.8 million in a combination of cash and earn-out payments.

In May 2021, the Company completed the acquisition of Linkuence SAS. The total consideration for

the acquisition of Linkuence amounted to $51.1 million in a combination of cash, equity and earn-

out payments.

In June 2021, the Company completed the acquisition of Owler Inc. The total consideration for the

acquisition of Owler Inc. amounted to $18.9 million which consisted of an upfront cash payment oset by

working capital adjustments.

In November 2021, the Company completed the acquisition of DeepReason.ai Limited. The total

consideration for the acquisition of DeepReason amounted to $5.9 million in a combination of cash,

equity and earn-out payments.

Details relating to signicant acquisitions during the year are highlighted in note 36 to the consolidated

nancial statements.

Suppliers

As a SaaS Company, the data are primary inputs, and the Company has long term contracts with the

leading technology companies. Our leading data vendors are located in North America, EMEAI and

APAC region.

Outlook 2022

The Company is well positioned at the beginning of 2022, as it will look to leverage its internal investments

made in 2021 in Sales & Marketing and R&D, increasing market demand for social products and the

opportunity from successful M&A in 2021 to continue working towards Meltwater’s long-term goals

and ambitions.

2021 Annual Report 42

Subsequent event

Share buyback program. On 3 December 2021, the general meeting authorized the Board of Directors to

repurchase Company shares. In December the Company announced a share buyback program, which

included general market repurchases. Under the program, Meltwater repurchased shares in the open

market in 2022, in line with applicable restrictions, relevant guidelines and main safe harbor principles on

price and volume limitations. Refer to note 37 in the consolidated nancial statements.

Segmental review

Information reported to the Group’s Chief Executive Ocer for the purposes of resource allocation and

assessment of segment performance is focused on the business activities which generates certain classes

of revenue and incurs certain classes of expenses. The principal business activities generate revenue

through one operating segment namely Media Intelligence, which is also the Group’s reportable segment

under IFRS 8.

Risk management

Risk management framework

The Group, also for the purposes of the best practice provisions relating to internal risk management and

control systems as set out in the Dutch Corporate Governance Code, adopts a risk management model

that designs and includes suitable tools for identifying, measuring, managing and monitoring risks that

could aect the achievement of strategic objectives. In this context, uncertainty and risk are dened as:

• uncertainty: state of lack of information, understanding or knowledge.

• risk: a possible event whose occurrence can prevent the achievement of company objectives

but which, if properly analyzed and managed, can also generate an opportunity.

The model integrated into the business processes is as much in line with the ve references of the

COSO (Committee of Sponsoring Organizations of the Treadway Commission Report – Enterprise

Risk Management (“ERM”) model) principles (as Governance & culture, Strategy & objective setting,

Performance, review & revision and Information, communication & reporting). It identies and classies

the main risks on the basis of strategic and operational objectives, denes the risk prole, and denes an

inherent communication process.

The Group has implemented a tool to identify, assess and monitor corporate risks. This tool is based

on the self-risk assessment approach, which provides for self-assessment and direct participation by

operational management and/or other players responsible for risk assessment.

Risks are analyzed, determining the likelihood of their occurrence and their impact, in order to establish

their priority and how they should be managed.

The risks are thus assessed in terms of inherent risk (risk in the absence of any intervention) and residual

risk (risk after the interventions to reduce it). Management selects the responses to risk (avoiding it,

reducing it, sharing or accepting it) by developing interventions to align the risks found with the levels of

tolerance and acceptable risk (risk appetite).

The framework was integrated within the Group’s organization and corporate governance. It supports the

protection of corporate assets, the eciency and eectiveness of business processes, the reliability of

nancial information, and compliance with laws and regulations.

The process is monitored, and modied where necessary, with interventions integrated into normal

business operations or in separate and specic assessments and audits, which are eventually

communicated to the organization and to the relevant corporate bodies.

2021 Annual Report 43

Furthermore, the Group operates at three levels of internal control:

• First level: identifying operating areas, evaluating and monitoring applicable risks in individual

processes, and establishing specic actions for managing such risks. The structures responsible

for the individual risks, for their identication, measurement and management, as well as for

performing the necessary checks are included in this rst level.

• Second level: departments responsible for supporting management in setting policies and

procedures, developing processes, and monitoring activities to manage risks and issues.

• Third level: it provides independent and objective assurance of the adequacy and eective

operation of the rst and second levels of control and, in general, of the overall method for

managing risks.

Current or planned improvements in the Meltwater’s overall risk management system

The Group promotes the continuous improvement of risk management according to the evolution of

strategies and information in the nancial documents about both the main risks and uncertainties that

occurred during the year and the impacts on the Group, as well as the objectives and policies with

respect to instruments for the management of nancial risks and for the assurance of economic results.

We continued to engage the business in key risk areas, benchmark our processes with peer companies,

and explore opportunities for improvement, in order to strengthen and improve ERM governance, monitor

risks in a more predictive way, and evaluate remediation plans. Meltwater will continue engaging the

business in reviewing our management and monitoring activities for key risks throughout the Group in the

upcoming year. As we continue to evolve our Group ERM program, we will strive to identify best practices

and rene our processes to identify and escalate risk developments.

Enterprise risk management initiatives during 2022

The Group has planned implementation of internal controls project so as to establish robust nancial

control environment which will enhance and supplement existing enterprise risk management and

control systems.

Risk appetite

The types of risks identied for the Group are classied as:

Strategic risks

a Risk that may derive from the pursuit of the business plan, from strategic changes in the

business context, and/or from adverse strategic business decisions that could aect the

Group’s long-term positioning and performance.

b Appetite: the Group considers itself ready to take risks in a responsible way that takes into

account the interests of our stakeholders and is consistent with our business plan.

Operational risks

a Risk that may aect internal processes, people, systems, and/or external resources,

hindering the Group’s ability to pursue its strategy.

b Appetite: the Group also pursues the goal of mitigating operational risks through projected

cost/benet assessments.

2021 Annual Report 44

Compliance risks

a Risk of non-compliance with laws, regulations, local standards, the code of conduct, and

internal policies and procedures.

b Appetite: the Group believes, like its employees, in acting with honesty, integrity and

respect, including compliance with its code of conduct as well as the laws and regulations

applicable wherever it operates.

Financial risks

a Risk relating to uncertainty of returns and potential nancial losses due to nancial

performance, together with the risks concerning the reliability of the reported

nancial information.

b Appetite: the Group takes a cautious approach to nancial risks and tries to maintain a

debt/capital structure prole that allows investing in long-term objectives and rewarding

stakeholders, as well as to represent the economic and nancial information provided

correctly.

The Risk management system comprises a structured process aimed at addressing individual risk

categories, dening the main guidelines for risk appetite and the risk responses applied.

RISK

CATEGORY

DESCRIPTION

RISK APPETITE RISK RESPONSE

Strategic

Risk that may derive from the

pursuit of the business plan,

from strategic changes in the

business context, and/or from

adverse strategic business

decisions that could aect the

Group's long-term positioning

and performance.

The Group considers itself

ready to take risks in a

responsible way that takes into

account the interests of our

stakeholders and is consistent

with our business plan.

Constantly investing in

research and development

eorts and constantly updating

the Group's product range and

oering.

Operational

Risk that may aect internal

processes, people, systems

and/or external resources,

hindering the Group's ability to

pursue its strategy.

The Group also pursues the

goal of mitigating operational

risks through cost/benet

assessments.

Proactively monitoring the

operational risks, consistently

with the overall risk policy,

to ensure that entities in the

Group will continue operating.

In addition, performing a

thorough due diligence on

potential acquisition targets

to limit operational risks post

acquisition.

Compliance

Risk of non-compliance

with laws, regulations, local

standards, the code of conduct,

and internal policies and

procedures.

The Group believes, like our

employees, in acting with

honesty, integrity and respect,

including compliance with our

code of conduct as well as laws

and regulations applicable

wherever we operate.

Monitoring and updating the

routines and mechanisms in

place to ensure compliance

with laws and regulations in the

various countries in which the

Group operates.

2021 Annual Report 45

Financial

Risk relating to uncertainty

of returns and potential

nancial losses due to nancial

performance, together with

the risks concerning the

reliability of reported nancial

information.

The Group takes a cautious

approach to nancial risks and

tries to maintain a debt/capital

structure prole that allows

investing in long-term objectives

and rewarding stakeholders,

as well as to represent the

economic and nancial

information provided correctly.

Monitoring the nancial risks,

with periodic mapping and

reporting to dene appropriate

mitigation actions. The

Group pursues the objective

of continually improving

the nancial information it

provides, reporting correct and

complete information in line

with international accounting

standards.

The main risks to which the Group is exposed are detailed in the next paragraphs.

Strategic risks

Product oerings that are on pace with changes in end-user demand and preferences

The markets in which the Group competes are characterized by frequent new product introductions and

enhancements, as well as shifting end-user preferences and demands. The Group’s future success will

depend on its ability to consistently address changes in end-user demands and develop and maintain

product oerings that meet evolving customer preferences. In order to compete successfully, the Group

must proactively address changes in demand and end-user preferences in its research and development,

its inventory levels, and the mix of its product oerings. The Group may not adequately adapt to changes

in end-user demands and preferences, and it may fail to adapt its product oerings in a timely manner.

The described risk showed a high/medium impact also in the last year on nancial and economic results.

The Group’s response actions that had a risk mitigation eect were mainly focused on evolving its product

range and oering innovative products compliant with regulatory and sustainability requirements. The

Group leverages its in-depth knowledge of the markets in order to tailor its propositions to local market

needs and activate locally.

Competition

The Group competes with both large international market participants and several smaller regional

and local competitors that vary by region and product. The markets in which the Group operates

require signicant investments in research and development. They are also characterized by technical

complexity. While this is advantageous for the Group for the purposes of defending its existing market

positions, it creates the risk that the Group may not be able to gain additional market share and improve

its competitive position. The described risk showed a medium impact on nancial and economic results.

The Group’s response actions that had a risk mitigation eect were mainly focused on increasing

competitiveness and innovation ambitions across the entire value chain, by accelerating the development

of technologies and products. Furthermore, the Group constantly monitors the initiatives taken

by competitors.

Future growth

The Group’s future growth also depends on a successful execution of the Group’s business plan, which,

in turn, depends on a number of assumptions. These relate to demand for the Group’s products, the

conditions of the markets in which the Group operates or is planning to expand, the position of the

Group’s competitors in those markets, and the resources available for planned growth initiatives and

the related costs. If the assumptions underlying the Group’s business plan for future growth turn out

to be materially inaccurate, or if the Group is otherwise unable to execute its business plan, the Group

may be unable to grow as planned and its business may be materially aected. The Group’s ability to

manage growth and integrate operations, technologies, products, and personnel depends on the Group’s

administrative, nancial and operational controls, its ability to create the infrastructure necessary

to exploit market opportunities for the Group’s products, and its nancial capabilities. The described

2021 Annual Report 46

risk showed a low impact on nancial and economic results. The Group’s response actions that had

a risk mitigation eect were mainly focused on continuing to monitor trends in the markets in which

the Company operates and that might aect its business in the future. We focus on evolving customer

needs by assessing behavioral patterns, actively engaging advisory boards to prepare potential

countermeasures.

Local business risks in many dierent countries

The Group’s growth strategy focuses on continuing to expand within the Group’s existing geographical

markets, as well as entering new markets. The Group’s success as a multinational business depends

upon its ability to anticipate and eectively manage dierent legal, political, social and regulatory

requirements, economic conditions, and unforeseeable developments. The Group may not be able to

succeed in developing and implementing policies and strategies that will be eective in each location

where it does business. In addition, the Group operates in emerging markets, where these risks may be

elevated, some of which, such as political and economic instability, few legal protections, and corruption,

can create a dicult business environment. This may also put the Group at a competitive disadvantage

against competitors that are not subject to, or do not comply with, the same regulations, thereby limiting

the Group’s growth prospects in such countries. The described risk showed a high/medium impact on

nancial and economic results. The Group’s response actions that had a risk mitigation eect were mainly

focused on continuously monitoring the geographical markets in which it operates, in order to anticipate

and minimize any vulnerabilities and to adopt prudent measures to mitigate risks, as, for example,

broadening the product portfolio and strengthening geographical diversication.

Global economic cycles

Global economic growth remains volatile and could stall or reverse course. A global economic downturn

could adversely aect customer condence and spending patterns, which could result in decreased

demand for the products sold by the Group. This could negatively impact the Group’s protability

and cash ows. In addition, a deterioration in current economic conditions could negatively impact

the Group’s customers, which could result in an increase in bad debt expense, customer bankruptcies,

or increase in prices. This could negatively impact the Group’s ability to distribute, market and sell

its products and the Group’s business, results of operations, nancial position, and prospects. The

Group derives most of its revenues from mature markets in Europe and the North America. Decreased

demand during an economic downtown in these mature markets can negatively aect prot margins

on technologically advanced products. Decreased demand in emerging markets where there is more

interest in product diversication can negatively aect sales volumes and prot margins on the

Group’s core product oerings. In both mature and emerging markets, in times of economic downturn,

consumers may choose to delay in spending on the Group’s products. This would reduce demand for the

Group’s products.

Financial reporting risks

As part of its responsibility to prevent and detect errors and fraud aecting its nancial statements, the

Company has set up specic accounting and reporting procedures in relation to, amongst other things,

revenue recognition process, taxation and other complex accounting issues. Any failure to prevent and

detect errors and fraud within the implementation of such procedures could have a material adverse

eect on the Group’s business, results of operations, nancial condition, cash ows and/or prospects.

In connection with the preparation and audit of the Group’s consolidated nancial statements as of 31

December 2021 and 2020 and for the years ended 31 December 2021 and 2020, material weaknesses

were identied in its internal control over nancial reporting. In order to maintain and improve the

eectiveness of its internal control over nancial reporting, the Group has expended, and anticipates

that it will continue to expend, signicant resources, including accounting-related costs and signicant

management oversight.

2021 Annual Report 47

Operational risks

Meltwater is exposed to a variety of operational risks, including data security and cyber risk, geopolitical

risk, failure of information technology systems and fraud. The potential adverse eects of the operational

risks are proactive monitored, consistent with the overall risk policy, to ensure that entities in the Group

will continue operating.

Meltwater is subject to various legal proceedings, including with respect to intellectual property rights

and employment related matters. Management vigorously defends the Group against claims; however,

any adverse decisions could aect the business, operating results, or nancial condition.

Acquisitions present many risks, and we may not realize the nancial and strategic goals that were

contemplated at the time of a transaction. Risks are countered by performing a thorough level of due

diligence before the completion of an acquisition transaction.

The Group derives a substantial portion of our revenues from, and have signicant operations,

outside of the U.S.

Compliance risks

Changes in legislative and regulatory requirements

Meltwater’s extensive operations in international markets expose the Group to a range of risks inherent

in international business activities, including, but not limited to, complex interactions and unexpected

changes in legislative or regulatory requirements and intellectual property rights related matters. As such,

Meltwater risks not being able to respond with sucient speed or correctness to such changes or complex

interactions laws and regulations in the 50 oces it operates in across 6 continents and 28 jurisdictions.

Materialization of such risks could have a material adverse eect on the Group’s business, results of

operations, nancial condition, cash ows and/or prospects.

Data protection and data privacy

Meltwater collects and processes personal information through its business and operations in multiple

jurisdictions. This makes the Group exposed to data protection and data privacy laws and regulations it

must comply with, which all imposes stringent data protection requirements and provides high possible

penalties for non-compliance. Although the Group has signicant security routines and mechanisms in

place to ensure compliance with data protection and data privacy regulations, any failure to comply

with data protection and data privacy policies, privacy-related obligations to customers or third parties,

privacy-related legal obligations may result in governmental enforcement actions, litigation or public

statements against the Group.

Tax legislation

Meltwater is subject to prevailing tax legislation, treaties and regulations in every jurisdiction in which

it is operating, and the interpretation and enforcement thereof. The Group’s income tax expenses are

based upon its interpretation of the tax laws in eect at the time that the expense is incurred. If the

Group’s interpretation of the tax laws is at variance with the interpretation of the same tax laws by tax

authorities, this could have a material adverse eect on the Group’s business, results of operations,

nancial condition, cash ows and/or prospects. Moreover, there are risks related to that a tax authority

successfully challenges the Group’s operational structure, intercompany pricing policies, receivables,

the taxable presence of its subsidiaries in certain jurisdictions, or tax authorities does not agree with the

Company’s and/or any subsidiaries’ assessment of the eects of applicable laws, classications and

determinations, treaties and regulations, or that the Group loses a material tax dispute in any country, or

any tax challenge of the Group’s tax payments is successful. These risks are derived from the nature of the

Group’s integrated multurisdictional operations in media intelligence and its need for tax planning when

considering national tax law, double taxation treaties and multilateral tax agreements.

2021 Annual Report 48

Intellectual property rights

The value of intellectual property rights is of high importance for the Group, as it operates in a competitive

commercial environment where the strength of the intellectual property rights may be an important

feature that distinguishes the Group from its competitors. As such, the importance of intellectual property

rights means that Meltwater can be particularly exposed to the risks of litigating various intellectual

property claims.

Financial risks

Meltwater is exposed to a variety of nancial risks, including the eects of foreign currency exchange

rates, credit risk of our customers and interest rate uctuations. Meltwater’s overall risk management

policy focuses on monitoring potential adverse eects considered material. Meltwater manages its capital

to ensure that entities in the Group will be able to continue as going concerns while maximizing the

return to stakeholders through the optimization of the debt and equity as applicable. The overall strategy

remains unchanged from the prior year.

Foreign currency exchange rates

Meltwater undertakes transactions denominated in foreign currencies; consequently, exposures to

exchange rate uctuations arise.

Credit risk of customers

Trade receivables consist of a large number of customers, spread across diverse industries and

geographical areas. Meltwater performs ongoing credit evaluations on the nancial condition of its

customers. Credit risks are reduced by doing business only with customers who are creditworthy, and

credit limits are designated to customers as applicable.

Interest rate risk

Meltwater does accept a certain degree of interest rate risk and other nancial risks and continue to

monitor these on an ongoing basis. It has some exposure to cash ow interest rate risk because the Group

has used borrowed funds with variable interest rates to nance its operations. The Group has variable

interest rate loans, which are subject to fair value interest rate risk.

Capital requirements

Meltwater is not subject to any externally imposed capital requirements. Prudent cash management

policies are used to reduce exposure to liquidity risk.

Non-nancial risks

Meltwater has not identied any material risks relating to the environment, society, employees, corruption

and violation of human rights.

COVID-19

During 2020, in response to mitigate COVID-19 induced uncertainties, the Group rightsized its cost

structure. The Group reduced its average headcount from 1,886 for 2019 to 1,786 for 2020.

Due to COVID-19 during 2020, in China the Company recorded 7.80% Year-over-Year reduction in revenue

(2021: RMB 62.8 million 2020: RMB 67.3 million). Except for China market, the impact on the business and

results has not been signicant and based on its experience to date the Group expects this to remain the

case.

Furthermore, during the COVID-19 pandemic, Meltwater did not see any increase in credit risk from its

customers and it expects its major customers to stay liquid and to full their payment obligations.

2021 Annual Report 49

No impairments were experienced due to the pandemic.

Russia-Ukraine war

The Group has minimal exposure in Ukraine and Russia as it is not present in these markets. The war poses

signicant challenges to the global economy and the Company is not immune from the waterfall eect of

the war. The Company is pro-actively managing any adverse impact on its business.

Non-nancial information

Meltwater is subject to the reporting requirements under the European Directive 2014/95/EU (“NFRD”)

which imposes on large public-interest entities with more than 500 employees, the obligation to disclose

non-nancial information in relation to the environment, society, employees, diversity, respect for human

rights and anti-corruption and bribery. In the Netherlands, the NFRD has been implemented by the Act

implementing the Directive 2014/95/EU, the Decree disclosure of diversity policy and the Decree on

disclosure of non-nancial information.

For a brief description of Meltwater’s business model, see the Introduction section. For the description of

risks regarding the environment, society, employees, corruption and violation of human rights, see the

Risk management section.

Environmental matters

Meltwater acknowledges its responsibility towards the environment and the importance of the matter for

the employees, customers, prospects, and investors. Hence, the Group has established a Global Green

Council for employees with a background and passion for environmental sustainability. The aim is to

develop policies that will lessen the impact of Meltwater on the environment.

The council leads the conversation and education around sustainability, creating a shared model of

responsibility, which assumes including energy, climate change, waste, and recycling aspects in business

decision-making.

The Group does not have an environmental policy implemented. Meltwater commits to adopting an

environmental policy in 2022.

Social matters

Meltwater’s corporate social responsibility is to give some of its knowledge and resources back to the

world. In 2008, Meltwater’s founder Jørn Lyseggen developed the concept of MEST.

MEST is a non-prot training and mentoring program established by Meltwater that enables Africans to

become software entrepreneurs. The goal of the program is to teach MEST students the skills required to

launch breakthrough global companies, thus enabling them to create jobs and wealth locally to stimulate

the African economy. MEST seeks out talented college graduates who are interested in entrepreneurship,

technology, and business to participate in the program.

The Company made charitable contributions of $2.5 million and $2.4 million to Meltwater Foundation,

Meltwater’s non-prot arm, in 2021 and 2020, respectively. These contributions were made with the

restriction that the funds will be donated to MEST.

Social matters are covered by the Group’s code of conduct.

Employee matters

Meltwater is an organization consisting of compassionate people with an interest and commitment that

goes beyond mere commercial objectives and aspirations.

The Company employed 56 employees as of 31 December 2021 (2020: 50) and the Group employed

2,255 employees as of 31 December 2021 (2020: 1,667). On average, approximately 1,962 employees were

employed during 2021 (2020: 1,785).

2021 Annual Report 50

Meltwater immensely values its employees, and it has fundamental belief in the potential they possess.

Meltwater regularly invests in sta training and skills development. It provides a conducive environment

where people are motivated and supported by their colleagues so as individuals discover their strengths.

Employee matters are covered by the Group’s code of conduct and the diversity policy (see below).

Diversity

Meltwater recognizes that dierences in skills, experience, education, nationality, age, gender, and other

characteristics of people are important – they enable both the Board of Directors and the Group as a

whole to look at issues and to solve problems in dierent ways, to respond dierently to challenges, and

to make more robust decisions. As such, the Board of Directors has adopted a diversity policy.

To create an environment of inclusion and acceptance within the Group in which each person is treated

equally without discrimination, Meltwater adopted a Diversity Policy in December 2021.

Through the Diversity Policy, the Board has committed to ensuring diversity in skills, experience,

education, background, nationality, gender, and other directors’ characteristics when selecting new

candidates for the Board. Additionally, the Board declares commitment to the Group’s objective of

ensuring that more of the senior management roles are (or continue to be) held by persons with dierent

expertise, experience, and diversity.

The Board will review the Diversity Policy, including its eectiveness, periodically and recommend

revisions if appropriate.

As of 31st December 2021, 17% of Meltwater’s Board positions were lled by women (1 in 6). Women

make up 50% of Group’s employee base and ll 42% of leadership positions, which is well above the

industry average.

Human rights and whistleblower matters

In December 2021, Meltwater adopted a whistleblower policy, which establishes a procedure for dealing

with reports of suspected wrongdoing within the Group. This whistleblower policy aims to promote and

support a culture of openness, responsibility, and integrity by providing an internal mechanism for

reporting, investigating, and remedying any suspected wrongdoing in the workplace without fear of

dismissal or retaliation and at an early stage.

The whistleblower policy ensures support of the employees or persons performing services for the

Group who le a report without jeopardizing their legal position, even if they turn out to be mistaken.

Responsibility for monitoring the procedure for dealing with a report is assigned to the non-executive

directors of Meltwater.

Outcomes of the Whistleblower Policy will be disclosed in Meltwater’s Directors Report for nancial

year 2022.

Anti-corruption and bribery matters

Meltwater is committed to maintain high ethical standards in its relations with customers, suppliers and

employees and to comply with laws and regulations within the anti-corruption regulatory framework of all

jurisdictions in which the Group operates.

Anti-corruption and bribery matters are covered by Meltwater’s whistleblower policy and the Group’s code

of conduct.

Non-nancial KPIs

Meltwater has adopted the following non-nancial key performance indicators:

NON-FINANCIAL KPI (Group) FY 2021

Material breaches of the code of conduct 0

Board of directors positions lled by women (%) 17%

Number of employees (year-end) 2,255

2021 Annual Report 51

EU Taxonomy

In accordance with applicable laws, Meltwater is subject to the obligation to disclose the proportion of its

turnover, its capital expenditures, and operating expenditure that is eligible under the EU Taxonomy.

The EU Taxonomy stipulates which activities can be labelled as ‘green’, that substantially contribute to

one or more of six environmental objectives. As of December 2021, two out of six environmental objectives,

being climate change mitigation (“CCM”) and climate change adaptation (“CCA”) are adopted and

business activities can be assessed.

Meltwater needs to identify if its activities are eligible under the EU Taxonomy. Our main activity is

computer programming. As this activity is currently not described in the EU Taxonomy, turnover, capital

expenditure and operating expenditure related to this activity can be classied as EU Taxonomy-non-

eligible. The next paragraphs shortly describe our eligibility assessment.

Turnover eligibility assessment

The turnover KPI is calculated by the proportion of the net turnover derived from products or services

that are Taxonomy-eligible. The denominator of the turnover KPI is based on net turnover which equates

to revenue in accordance with IFRS 15. For further details on accounting policies refer to Signicant

accounting policies note 3.18 Revenue from contracts with customers. Management considered whether

these activities could be eligible under Computer programming activities but concluded that these are not

enabling activities for CCM and CCA. Based on the above, the Taxonomy-eligible turnover amounts to 0%.

Capital expenditure eligibility assessment

Under the EU-taxonomy regulation, the capital expenditure (“CapEx”) KPI is calculated as the CapEx

associated with Taxonomy-eligible activities divided by the total CapEx. Total CapEx covers additions

to tangible (property, plant and equipment (IAS 16) and right-of-use assets (IFRS 16)) and intangible

assets (IAS 38) considered before depreciation, amortization, and any re-measurements, including those

resulting from revaluations and impairments and excluding fair value changes during the nancial year.

For further details on accounting policies refer to note 4 Property, plant and equipment and note 5 Other

intangible assets. Management assessed that there were no material additions during the year which

fullled the Taxonomy-eligible activity criteria. Further, Management do not currently have a “CapEx

plan” as no Taxonomy-eligible economic activities are planned to become Taxonomy-aligned activities, as

no Taxonomy-eligible activities are identied in the rst instance. Management concludes that Taxonomy

CapEx eligibility is 0%. Refer to table under Eligible activities for climate change mitigation and climate

change adaptation.

Operating expenditure eligibility assessment

The operating expenditure (“OpEx”) KPI is calculated by the proportion of the operating expenditure

associated with Taxonomy-eligible activities. Total OpEx relates to direct, non-capitalized costs such

as research and development, maintenance and repair and any other direct expenditure. These costs

recognized during the reporting period are contained in the consolidated statement of prot or loss. As

the nature of Meltwater’s business model is not centered around tangible assets, Management assessed

that there were no assets or processes associated with Taxonomy-eligible activities. Management

concludes that Taxonomy OpEx eligible activities is 0%. Refer to table under Eligible activities for climate

change mitigtion and climate change adaptation.

Eligible activities for climate change mitigation and climate change adaptation

Meltwater concluded that its activities related to turnover, capital expenditure and operating expenditure

are not included in the current EU taxonomy regulation.

REVENUE CAPEX OPEX

Eligible 0% 0% 0%

Non-eligible 100% 100% 100%

2021 Annual Report 52

Jørn Lyseggen

Executive Chair

David Faugno

Senior non-executive director

Mattias Erik Holmström

Non-executive director

Sang Kim

Non-executive director

Erik Langaker

Non-executive director

Stefanie Witte

Non-executive director

Economic impact

The Company is a global provider with international operations. With over 27,000 clients and employees

in 50 oces across six continents, the Group has positive impacts on economies worldwide – this includes

job creation and salaries, taxes, vendor purchases, R&D, social investments, and more.

The Company’s direct economic value generation (including revenue, R&D expenses, operating expenses,

labor costs, income tax) can be found in the nancial review section. See the Non-nancial information

section (Social matters and Employee matters subsections) for more on social investments and job

creation.

Statements by the Board of Directors

Meltwater’s consolidated and company nancial statements for 2021 have been prepared in accordance

with IFRS as adopted by the EU and with Part 9, Book 2 of the Dutch Civil Code.

In accordance with best practice provision 1.4.3 of the Dutch Code and based on the evaluation carried

out, the Board of Directors declares that, to the best of its knowledge:

a the Board of Directors report provides sucient insights into any failings in the eectiveness

of the internal risk management and control systems (please refer to section ‘Risk management’);

b the internal risk management and control systems are designed to provide reasonable assurance

that the nancial reporting does not contain any material inaccuracies (please refer to section

‘Internal control systems’);

c based on the current state of aairs, it is justied that the nancial statements are prepared

on a going concern basis please section ‘Financial statements’); and

d the Board of Directors report states those material risks and uncertainties that are relevant to the

expectation of the Company’s continuity for the period of twelve months after the preparation of

this annual report (please refer to section ‘Risk management’).

As required by Section 5:25c paragraph 2(c) of the Dutch Financial Supervision Act, the Board

of Directors declares that, to the best of its knowledge:

a the nancial statements provide a true and fair view of the assets, liabilities, nancial positions

and prot or loss for the year of the Company and its enterprises included in the consolidation

taken as a whole;

b the Board of Directors report provides a fair view of the position at the balance sheet date

and developments during the year under review of the Company and its enterprises included

in the consolidation taken as a whole, together with a description of the principal risks

confronting Meltwater.

2021 Annual Report 53

Governance Report

In December 2021, the Company’s admission to listing and trading on

Euronext Growth Oslo was transferred to a main listing at Oslo Børs (the

“Uplisting”). In connection therewith, the Company was converted from

a Dutch private company with limited liability (besloten vennootschap

met beperkte aansprakelkheid) into a Dutch public company with limited

liability (naamloze vennootschap). The Company’s articles of association

were lastly amended on 6 December 2021 in connection with the Uplisting

and the conversion into a Dutch public company with limited liability.

The Company is the ultimate parent company of the Group. Details of

the Company’s signicant subsidiaries are disclosed in note 30 to the

consolidated nancial statements.

Since the Uplisting, the Company has adopted and implemented a

corporate governance regime which in all material respects complies, except

as set out below, with the Code of Practice for Corporate Governance

last updated 14 October 2021 (the “Norwegian Code”). Furthermore the

Company has adopted, except as set out below, the best practice provisions

of the Dutch Corporate Governance Code dated 8 December 2016 (the

“Dutch Code”), which contains principles and best practice provisions for

listed companies that regulate relations between, inter alia, the Board of

directors of the Company (the “Board of directors”) and its committees and

the relationship with the general meeting of the Company.

In this governance report the Company addresses its overall corporate

governance and discloses any material departure from the best practice

provisions of the Norwegian Code and the Dutch Code and the reasons for

such departure.

The Netherlands is the Company’s home member state for the purposes of

the EU Transparency Directive (Directive 2004/109/EC, as amended).

2021 Annual Report 54

Board of directors

NAME AGE POSITION SINCE TERM

Jørn Lyseggen 53

Executive Chair

and executive

director

2011 Indenite

David Faugno 52

Senior Non-

Executive

Director

2019 Indenite

Mattias Erik

Holmström

39

Non-executive

director

2017 Indenite

Sang Kim 51

Non-executive

director

2021 Indenite

Erik Langaker 58

Non-executive

director

2021 2025

Stefanie Witte 48

Non-executive

director

2021 2025

Composition and powers

The Company maintains a one-tier board

consisting of executive directors and non-

executive directors. The executive directors are

responsible for the day-to-day management

of the Company. The non-executive directors

supervise and advise the executive directors. The

board as a whole is responsible for the strategy

and the management of the Company. Dutch law

provides that resolutions of the Board of directors

involving major changes in the Company’s identity

or character are subject to the approval of the

general meeting.

As per 31 December 2021, the Board of directors

comprises one executive director, being the

Executive Chair and ve non-executive directors. In

accordance with the articles of association of the

Company the Board of directors designated one of

the non-executive directors as Senior Non-Executive

Director.

Other than Mattias Holmström and Jørn

Lyseggen, who are aliated with the Company’s

major shareholders (Altor Fund III, through Big

Data Holding Ltd., and Fountain Venture AS,

respectively), all directors are independent from

the Company and its main shareholders. The

independence requirements of the Norwegian

Code and Dutch Code are both met.

As at the date of this annual report, the Board of

directors comprises the following directors:

2021 Annual Report 55

Director biographies

Jørn Lyseggen

Non-independent Executive Chair and Executive Director

Jørn Lyseggen was born in 1968 and is of Norwegian nationality. Jørn Lyseggen is Meltwater’s Founder

and has been the Executive Chair of the Company since 15 November 2011. He is a Norwegian serial-

entrepreneur with four start-ups, two trade sales and two public listings on his track record. He began his

career as a research scientist in articial intelligence at the Norwegian Computing Center. He has been

awarded two technical patents and has written the book “Outside Insight” which describes the business

opportunities in utilizing external data and has been translated to 8 languages. Lyseggen is also member

of the board of Meltwater Entrepreneurial School of Technology (“MEST”), the innovation community MESH,

and Brandbassador AS.

David Faugno

Independent Senior Non-Executive Director

David Faugno was born in 1970 and is of American nationality. David Faugno is the Senior Non-Executive

Director of the Company. He has been a non-executive director since 1 July 2019. He has more than 25

years of management experience, including as CFO of Barracuda Networks and EVP and CFO of Qualtrics.

He is currently a board member of Eagle Eye Networks and Browserstack.

Mattias Erik Holmström

Non-independent Non-Executive Director

Mattias Erik Holmström was born in 1983 and is of Swedish nationality. He is a non-executive director of

the Company, a position he has held since 16 February 2017. Mattias Holmström is a Partner at Altor and

is, among others, a board member of Meltwater, QNTM, ARC, Raw Fury, Hesehus, Raptor and Transcom. He

has extensive experience as a private equity investor and board member from over 10 years with Altor and

working with Meltwater since Altor Fund III’s investment in 2012, as well as working as strategy consultant

with Booz & Company for 2 years.

Sang Kim

Independent Non-Executive Director

Sang Kim was born in 1970 and is of American nationality. He is a non-executive director of the Company,

a position he has held since 3 December 2021. He is a partner and global board member of DLA Piper LLP,

Co-Chair Global Tax DLA Piper LLP, and chairs the Bronx Science Foundation. Sang Kim has led several

hundred global expansion and structuring matters for companies across a wide spectrum of industries from

emerging enterprises to the largest multinationals.

Stefanie Witte

Independent Non-Executive Director

Stefanie Witte was born in 1973 and is of German nationality. She is a non-executive director of the

Company, a position she has held since 30 June 2021. Stefanie has been working for more than 10 years

at Google, most recently as Director for Chrome OS Consumer, where she is responsible for Northern

Europe and DACH. Prior to that she worked, among others, in Business Development for Novartis and as a

consultant at McKinsey & Company. She is also a member of the Board of directors at EcoOnline AS and

Myneva Group GmbH.

Erik Langaker

Independent Non-Executive Director

Erik Langaker was born in 1963 and is of Norwegian nationality. He is a non-executive director of the

Company, a position he has held since 30 June 2021. Erik is an investor and entrepreneur with signicant

experience from various directorships in both listed and private companies in Scandinavia and the rest of

world. Erik chaired the boards of Stormgeo Group, Datarespons (listed on Oslo Børs), EPC Plc (now Verra

Mobility, listed on NASDAQ) and CMR Surgical (UK) Ltd and served as board member of HitecVision, Seram

Coating, Aschehoug publishing AS, Link Mobility Group (listed on Oslo Børs) and ELOP Group (listed on

Oslo Børs). Erik Langaker has been a member of the association of certied nancial analysts in Norway

since 1987. He is currently the chair of Vestland Group, Pragmatic Semiconductor (UK) Ltd, Papiry Group,

Kezzler and ComplAI as. He is also a board member of Zalaris ASA (listed on Oslo Børs) and Resoptima AS.

2021 Annual Report 56

Executive management biographies

John Box

CEO

John Ryan Box is a British citizen and the company’s CEO. John has been with the Company since 2006,

holding several management positions, including ve years as Area Director and six years as Executive

Director. In his position as Executive Director, John was responsible for the Company’s oces in Tokyo,

Hong Kong, Shanghai, Being, Singapore, Kuala Lumpur, Perth, Sydney, Brisbane and Melbourne. This has

provided John with extensive international business experience. John holds a Bachelor of Arts in French

and History from the Canterbury Christ Church University and a Master Level Diploma in Organizational

Leadership from Said Business School, University of Oxford.

Elena Shishkina

CFO

Elena Shishkina is the company’s CFO, and joined the company in October 2021. Lena brings over 20 years

global experience in enterprise software and B2B SaaS market to Meltwater. Previously she held positions

such as CFO of UK & Ireland at Fortune 100 ranked software company SAP, as well as VP of Finance for

EMEA, Asia Pacic & Japan at the NASDAQ listed SaaS company Workday. Most recently she held the

position of Chief Financial & Operations Ocer at Red Points, a global leader in brand protection. Elena

is a British citizen, and has lived and worked in six countries. She has a Master of Business Administration

(MBA) degree from Durham University in the United Kingdom.

Aditya Jami

CTO

Aditya Jami is the company’s CTO and has been with the company since 2016. Aditya is an experienced

technology leader with demonstrated history in executing complex engineering systems, developing

product strategy, creating high velocity engineering culture, driving M&A integrations at Meltwater, and at

international corporations such as Netix and Yahoo. His industry & academic eorts have been translated

into successful products, open source software and recognized in form of awards for research papers as

well as in the popular press. Jami holds an M.S. in Computer Science from Stanford University and served

as a visiting scientist at Cornell University.

2021 Annual Report 57

Appointment, suspension and dismissal of directors

The articles of association of the Company provide that the number of directors shall be determined by

the Board of directors. The Board of directors will designate one of the executive directors as Executive

Chair. In the event only one executive director has been appointed the sole executive director will also act

as Executive Chair. Furthermore, the Board of directors will designate one of the non-executive directors as

Senior Non-Executive Director.

Directors are appointed by the general meeting pursuant to a binding nomination of the Board of di-

rectors. If a director is to be appointed, the Board of directors shall nominate one or more candidates. A

resolution of the general meeting to appoint a director in accordance with a nomination by the Board of

directors shall be adopted by absolute majority of the votes cast. The general meeting may at all times

overrule the binding nature of such a nomination by a resolution adopted by a majority of at least half of

the votes cast, provided such majority represents more than half of the Company’s issued capital.

The articles of association of the Company provide that a director may be suspended or dismissed as a

director by the general meeting at any time. A suspension by the general meeting can be ended by the

general meeting at any time.

Unless at the proposal of the Board of directors, a resolution of the general meeting to suspend or dismiss

a director requires a resolution adopted by a majority of at least half of the votes cast, provided such

majority represents more than half of the Company’s issued capital.

Diversity

The Company recognizes the benets of having a diverse Board

of directors and sees diversity at Board of directors level as an

important element in maintaining a competitive advantage. As

such, the Board of directors has adopted a diversity policy. The

diversity policy will be taken into account when considering the

appointment and reappointment of directors.

The diversity policy will provide that a diverse Board of directors

will include, and make use of, dierences in the background,

gender, geographical and industry experience, skills and other

distinctions between directors. These dierences will be consid-

ered in determining the composition of the Board of directors

and, when possible, will be balanced appropriately. Board of directors appointments are made on merit,

in the context of the diversity, experience, independence, knowledge and skills the Board of directors as a

whole requires to be eective. The Board will review the diversity policy, including its eectiveness, period-

ically and recommend revisions if appropriate.

Since the Uplisting, the Board of directors comprised ve non-executive directors, of which four men (80%)

and one woman (20%). As of 31 December 2021, women make up 50% of Group’s employee base and ll

42% of leadership positions, which is well above the industry average.

Board of directors rules

The Board of directors has adopted rules with respect to the holding of meetings by and the decision-taking

process of the Board of directors and other matters concerning the Board of directors, its committees and

the directors.

Where unanimity cannot be reached, all resolutions of the Board of directors are adopted by an absolute

majority of the votes cast, unless the law, the articles of association or the Board of directors rules provide

otherwise. Resolutions of the Board of directors require approval of the general meeting when these relate

to an important change in the identity or character of the Company or its enterprise. A director may only

be represented by another director authorized in writing. Each director shall have one vote.

GENDER DIVERSITY ON THE BOARD

5 non executive

directors

20%

80%

4 men

1 woman

2021 Annual Report 58

Indemnication

The articles of association include provisions regarding the indemnication, to the extent permissible by

the rules and regulations applicable to the Company, of current and former directors against reasonable

actual costs, including the reasonable actual costs of legal counsel, made by a director or former director

in connection with a dispute resulting from the act or the failure to act of a director or former director

in the performance of his/her duties and in which a director or former director has become personally

involved.

There shall, however, be no entitlement to reimbursement and any person concerned will have to repay the

reimbursed amount if and to the extent that: (i) if a Dutch court of law has rendered an irrevocable ruling

to the eect that the costs are the result of willful (opzettelk), intentionally reckless (bewust roekeloos)

or seriously culpable (ernstig verwtbaar) conduct on the part of the director or former director, unless

Dutch law provides otherwise or this would, in the view of the circumstances of the case, be unacceptable

according to standards of reasonableness and fairness (redelkheid en billkheid); (ii) when it concerns a

dispute initiated by or on behalf of the director or former director against the Company, any of the Group

companies or a third party, primarily aimed at pursuing a claim on his / her own behalf; or (iii) when the

costs are covered by an insurance for the benet of the director or former director.

Conicts of interest

Dutch law provides that a member of the board of a Dutch public company with limited liability, such as

the Company, may not participate in the adoption of resolutions (including deliberations in respect of

these) if he or she has a direct or indirect personal interest conicting with the interests of the company.

Such a conict of interest in any event exists if in the situation at hand the director is deemed to be

unable to serve the interests of the company and the business connected with it with the required level of

integrity and objectivity. Pursuant to the articles of association, any director shall immediately report any

(potential) conict of interest to the Board of directors and shall provide all information relevant to the

(potential) conict.

Jørn Lyseggen (Executive Chair) is the Company’s largest shareholder. Mattias Erik Holmström (non-

executive director) is independent from management, but not independent of a major shareholder as he is

appointed to the Board of directors by Altor Fund III (through Big Data Holding Limited).

Other than set out above, during the year under review, no conict of interests matters occurred with

respect to the Company and its directors.

Related party transactions

The Company has a related party transactions policy providing for procedures for directors to notify a

potential related party transaction. Potential related party transactions shall be subject to review by and

approval of the Board of directors in accordance with Dutch law. The Board of directors may approve the

related party transaction only if it determines that it is in the interests of the Company and its aliated

business.

Related party transactions include transactions between the Group and “related parties” as dened in

the related party transactions policy, including, one or more shareholders representing 10% of the issued

share capital in the Company, a director and any parties qualifying as such in accordance with IFRS (IAS

24 – Related Party Disclosures).

The Company has entered into related party transactions, primarily loan agreements, with its Executive

Chair and other founders and entities with which they are aliated.

The Executive Chair is a director at the Meltwater Foundation and MEST, both of which are not-for-prot

organizations. The Company made charitable contributions of $2.5 million and $2.4 million to Meltwater

Foundation in 2021 and 2020, respectively. These contributions were made with the restriction that the

funds would be donated to MEST.

2021 Annual Report 59

Jørn Lyseggen is also a founder of Shack15. In February 2019, the Company entered into a new sublease

with Shack15 to rent oce space. Due to COVID-19, in December 2020 the Company amended the

agreement to extend the term of the sublease up to June 2023. The total obligation during the term of

sublease is $6 million and was fully settled in December 2020.

In April 2019, the Company entered into a $28.1 million non-convertible promissory note agreement (the

“2019 Related Party Note Receivable”) with the Company’s then Chief Executive Ocer. The 2019

Related Party Note Receivable was entered into at arm’s length terms. The note matured in April 2020. In

April 2020, June 2020 and October 2020, the Company extended the maturity date of the 2019 Related

Party Note Receivable to July 2020, October 2020, and December 2020, respectively. The loan agreement

stated an eective interest rate of 13.2% per annum, which accrued on a quarterly basis, which was

payable either at the loan’s maturity or upon prepayment of the note. For the nancial year ended 31

December 2020, the Company accrued interest related to the 2019 Related Party Note Receivable of $4.1

million. The Related Party Note including all accrued interest was paid in full in December 2020.

Board of directors committees

The Board of directors has two committees that discuss specic issues and prepare items on which the full

Board of directors takes decisions. The chair of each committee reports on the main points of discussion

and the resulting recommendations are discussed at the subsequent Board of directors meeting. The two

committees are:

01 The audit committee

02 The remuneration committee

The audit committee and the remuneration committee consist of non-executive directors.

01

Audit committee

• David Faugno (chair)

• Sang Kim

• Erik Langaker

On 30 June 2021, Andreas Jan-Ulrik Säfweräng resigned as member of the audit committee and was

replaced by Erik Langaker. David Flannery resigned on 3 December 2021 and was replaced by Sang Kim.

The audit committee advises the Board of directors and prepares decision-making on matters such as the

supervision of the integrity and quality of the nancial reporting and the eectiveness of the internal risk

management and control systems.

All members of the audit committee, including the chair, are considered to be independent within the

meaning of the Norwegian Code and the Dutch Code and David Faugno is a nancial expert. The audit

committee as a whole has competence relevant to the sector in which the Company operates.

The chief nancial ocer, the head of the internal audit department and the external auditor shall attend

the audit committee meetings, unless the audit committee determines otherwise. The audit committee

decides whether and, if so, when the Executive Chair and the chief executive ocer shall attend audit

committee meeting. The audit committee shall meet as often as deemed necessary for the proper

functioning of the audit committee and at least four times a year. The audit committee shall meet with the

external auditor as often as it considers necessary but shall meet at least once a year with the external

2021 Annual Report 60

auditor without the Board of directors being present.

In 2021, the audit committee met ve times. At these meetings several matters were discussed.

The main issues related to the:

• approval of audit committee rules;

• approval of the updated whistleblowing policy;

• information on the nancial and economic situation of the Group;

• information on the external audit function;

• presentation of the internal audit function, activities and related principles and methodologies with

information on the main audit activities 2021 and on the audit plan for 2022.

02

Remuneration committee

• Mattias Erik Holmström (chair)

• David Faugno

• Stefanie Witte

On 23 February 2021, David Faugno was appointed as member and chair of the remuneration committee.

On 23 February 2021, Mattias Erik Holmström was appointed as member of the remuneration committee,

and he replaced David Faugno as chair on 14 December 2021. On 30 June 2021, David Flannery resigned

as member of the remuneration committee and Stefanie Witte joined the remuneration committee in

December 2021.

The remuneration committee advises the Board of directors on remuneration matters including the

remuneration policy for the directors, the remuneration of the executive director and management

remuneration structures including incentives programs. In addition, the remuneration committee is a

sounding board to management on specic employee remuneration topics.

All members of the remuneration committee are independent within the meaning of the Dutch Code and

the Norwegian Code, except for Mattias Holmström, who is aliated with one of the Company’s major

shareholders (Altor Fund III, through Big Data Holding Ltd.).

In 2021 the remuneration committee met six times. At these meetings, several matters were discussed,

including formalizing of the workplan inclusive of the role of the committee, the establishment of

the remuneration of the executive director and the preparation of a new long term equity incentive

plan as replacement of the Company’s equity incentive plan 2011. In consultation with the Board, the

remuneration committee appointed a leading executive compensation expert rm to advise on the new

equity incentive plan. The remuneration committee met several times with the expert rm to discuss the

new equity incentive plan and made a set of recommendations to the Board. In addition, the remuneration

committee discussed the new remuneration policy that was approved by the general meeting in

December 2021.

General meetings

AAt least one annual general meeting shall be held every year, which meeting shall be held within six

months after the close of the nancial year. Additional general meetings will be held as often as the

Board of directors considers such to be necessary. All convocations of the general meetings and all

2021 Annual Report 61

announcements, notications and communications to shareholders shall be made available on the

Company’s corporate website. Notice of a general meeting must be given by at least 42 days prior to

the day of the meeting. General meetings must be held in the Netherlands in Amsterdam, Rotterdam, The

Hague, or Haarlemmermeer (including Schiphol Airport). At general meetings, each share confers a right

to cast one vote.

Shareholders representing alone or in aggregate at least 10% of the issued and outstanding share capital

may request that a general meeting be convened. If no general meeting has been held within eight weeks

of the shareholders making such request, the shareholders making such request may, upon their request,

be authorized by the district court in summary proceedings to convene a general meeting.

Shareholders holding at least 3% of the Company’s issued and outstanding share capital may request,

by a motivated request, that an item is added to the agenda. Such requests must be made in writing,

must either be substantiated or include a proposal for a resolution, and must be received by the Executive

Chair at least 60 days before the day of the general meeting. No resolutions may be adopted on

items other than those that have been included in the agenda (unless the resolution would be adopted

unanimously during a meeting where the entire issued capital of the Company is present or represented).

Pursuant to the Dutch Code, if one or more shareholders intend to request that an item be put on the

agenda for a general meeting that may result in a change in the Company’s strategy, for example as a

result of a proposed dismissal of one or more executive directors or non-executive directors, the Board

of directors may invoke a reasonable response time that does not exceed 180 days from the moment the

Board of directors is informed by one or more shareholders of their intention to put an item on the agenda

to the day of the general meeting at which the item is to be dealt with. The relevant shareholder(s) should

respect the response time invoked by the Board of directors. The Board of directors shall use the response

time for further deliberation and constructive consultation, in any event with the relevant shareholder(s)

and shall explore alternatives. At the end of the invoked response time, the Board of directors shall report

on the outcome of such deliberation and consultation to the general meeting. The response time may

only be invoked once for any given general meeting and shall not apply to an item in respect of which the

response time has previously been invoked, or to a general meeting where a shareholder holds at least

three-quarters of the issued capital as a consequence of a successful public oer.

Issuance of shares and pre-emptive rights

Resolutions to issue shares shall be adopted by the general meeting or, if the general meeting authorizes

the Board of directors to do so, by the Board of directors. A resolution of the general meeting to issue

shares or to designate the Board of directors, as the competent body to issue shares, can only be adopted

with an absolute majority. The foregoing also applies to the granting of rights to subscribe for shares,

such as options, but does not apply to the issue of shares to a person exercising a previously acquired

right to subscribe for shares. The resolution authorizing the Board of directors must specify the number

of shares which may be issued (which may be expressed as a percentage of the issued capital). An

authorization by the general meeting to issue shares must state the term for which it is valid, which term

may not be longer than ve years. The authorization may be renewed in each case for another maximum

period of ve years. Unless provided otherwise in the authorization, it may not be withdrawn. The

Company may not subscribe for its own shares on issue.

Pursuant to a resolution adopted by the general meeting, the Board of directors has been granted the

authority for a period of 18 months commencing on 7 December 2021, to resolve to issue shares (either in

the form of stock dividend or otherwise) and/or grant rights to acquire shares up to (a) a maximum of 10%

of the issued shares as at 7 December 2021 for general corporate purposes and (b) a maximum of 10% of

the issued shares as at 7 December 2021 for M&A transactions.

Upon the issue of shares or the granting of rights to subscribe for shares, each holder of shares shall have

2021 Annual Report 62

a pre-emptive right in respect of the shares to be issued, in proportion to the number of shares held by it.

Exceptions to these pre-emptive rights include: (i) the issue of shares against a contribution in kind, (ii) the

issue of shares to employees of the Company or of a group company (groepsmaatschapp) pursuant to

an employee share scheme or as an employee benet, and (iii) the issue of shares to persons exercising a

previously granted right to subscribe for shares.

Pursuant to the articles of association, the pre-emptive rights may be restricted or excluded pursuant to

a resolution of the general meeting. The proposal to this eect must explain in writing the reasons for the

proposal and the intended issue price. The pre-emptive right may also be restricted or excluded by the

Board of directors if the Board of directors has been authorized by a resolution of the general meeting

for a limited period of time of no longer than ve years to restrict or exclude the pre emptive right. Unless

provided otherwise in the authorization, it may not be withdrawn. A resolution of the general meeting to

restrict or exclude the pre-emptive right to shares or to issue an authorization to restrict or exclude the

pre-emptive right requires a majority of at least two-thirds of the votes validly cast if less than 50% of the

issued share capital is represented at the general meeting.

Pursuant to a resolution adopted by the general meeting, the Board of directors has been granted the

authority for a period of 18 months commencing on 7 December 2021, to resolve to restrict or exclude

the pre-emptive rights of shareholders in relation to the issue of, or the grant of rights to subscribe for,

shares for which the Board of directors has been authorized by the general meeting to resolve to issue, as

described above.

Major shareholders

Dutch law requires shareholders to report their holdings in Dutch listed companies to the AFM if they

exceed 3% of total outstanding share capital (and at certain higher thresholds). As per the AFM register,

three shareholders held a position in the Company of 3% or more per 31 December 2021: Jørn Lyseggen

(via Fountain Venture A.S.) (42.02%), Big Data Holding Limited (13.05%) and Incentive AS (as AIF Manager

for Incentive Investment Funds ICAV) (5.73%).

The articles of association do not provide for any specic provisions beyond those required by applicable

law and regulation to ensure that control by the major or controlling shareholders is not abused.

Dividend policy and dividend

The Company does not have a dividend policy. The Company has not paid any dividend during the

nancial years ended 31 December 2021 and 31 December 2020.

If the Company does decide to pay dividends in the future, a distribution of dividends may only take

place after the adoption of the annual accounts by the general meeting that show that the distribution is

allowed, or, in the case of an interim dividend, it appears from an interim statement of assets signed by

the Board of directors that the Company’s equity does not fall below the sum of called-up and paid-up

share capital and any statutory reserves.

Control systems

The Statements by the Board of directors conrm with best practice provision 1.4.3 of the Dutch Corporate

Governance Code. The information concerning the main features of Meltwater’s risk management and

control systems relating to the nancial reporting process, as required by article 3a(a) of the Decree, can

be found in the ‘Internal control systems’ and ‘Risk management’ sections of the Director’s Report.

2021 Annual Report 63

Compliance with corporate governance codes

Since the Company has its seat in the Netherlands and its shares are listed on the Oslo Børs, the

Company has decided to implement a corporate governance regime in line with both the Norwegian

Code and the Dutch Code. The full text of the Norwegian Code is available on www.nues.no and the full

text of the Dutch Code is available on www.mccg.nl. The Board of directors is responsible for ensuring

satisfactory corporate governance.

In accordance with article 2a(3) of the decree on the content of the management report (Besluit inhoud

bestuursverslag) this Governance Report is deemed to be part of the annual report, including the annual

nancial statements for the year ended 31 December 2021.

Both the Norwegian and the Dutch Code are based on a ‘comply or explain’ principle. Accordingly,

companies are required to disclose in their board report whether or not they are complying with the

various best practice provisions of the code. If a company deviates from a best practice provision in the

code, the reason for such deviation must be properly explained in its directors’ report.

Norwegian code

The Company has adopted and implemented a corporate governance regime which in all material

respects complies with the Norwegian Code. The Company complies in all material respects with the

principles of the Norwegian Code, except for the following provisions:

• Provision 3(4) (mandate granted to the Board of directors): The Company does not comply

with provision 3(4) which provides that mandates granted to the Board of directors to increase the

company’s share capital or to purchase own shares should be limited in time to no later than the date

of the next annual general meeting. Instead, the Company complies with the Dutch market practice to

grant this authority for a period of eighteen months.

• Provision 7 (nomination committee): The Company deviates from provision 7 which provides that the

company should have a nomination committee. The Board of directors has not established a selection

and appointment, since most Directors are appointed for an indenite period of time and if a vacancy

arises, the non-executive directors will full this role.

• Provision 8 (Board of directors: composition and independence): The Company partly deviates

from provision 8 which provides that the Board of directors should not include executive personnel and

the term of oce should not be longer than two years at the time. Under Dutch law, it is required that a

one-tier board includes at least one executive director and the Company complies with the provisions of

the Dutch Code in relation to the term of oce.

• Provision 11(2) (remuneration Board of directors): The Company deviates from provision 11(2)

which provides that the remuneration of the Board of directors should not be linked to the company’s

performance. The non-executive directors will receive their remuneration in the form of restricted share

units to ensure alignment between the non-executive directors and the Company’s value creation.

• Provision 12(2) (remuneration of executive personnel): The Company deviates from provision 12(2)

which provides that the remuneration of the executive personnel should be subject to an absolute limit.

In line with competitors and peers, the Company uses options and RSUs as part of the compensation

packages. These are linked to share price performance.

Dutch code

Since the Uplisting of the Company took place in December 2021, several provisions of the Dutch Code

have not been complied with in 2021. The Company intends to comply with the provisions in 2022, except

for the provisions set out below:

2021 Annual Report 64

• Best practice provisions 2.2.1 and 2.2.2 (term directors): The Company does not comply with best

practice provision 2.2.1, since most Directors are appointed for an indenite period of time. Currently,

the Board of directors does not believe there is a driving interest in limiting the members to the four-

year terms. The Board of directors believes that a depth of history and knowledge of the Company,

which can be developed through long-term service, continues to be key to an eective oversight of the

Company. The Board of directors revisits the provisions in its governing documents regularly and may

determine that limitations of the term for directors is appropriate.

• Best practice provision 2.2.4 (succession): The Company partly deviates from best practice provision

2.2.4 which provides that the non-executive directors should draw up a retirement schedule in order

to avoid, as much as possible, non-executive directors retiring simultaneously and that the retirement

schedule should be published on the website. The non-executive directors have not drawn up a

retirement schedule, since most Directors are appointed for an indenite period of time.

• Best practice provision 2.3.2 (establishment of committees): The Company partly deviates from

best practice provision 2.3.2, which provides that if the board consists of more than four members,

it shall appoint an audit committee, a remuneration committee and a selection and appointment

committee. The Board of directors has not established a selection and appointment, since most

Directors are appointed for an indenite period of time and if a vacancy arises, the non-executive

directors will full this role.

• Best practice provision 2.3.4 (composition of the committees): The Company partly deviates from

best practice provision 2.3.4, which provides that the audit committee and the remuneration committee

should not be chaired by the chairman of the Board or by a former executive director. Since the

Company has an Executive Chair, the Company believes that the audit committee could best be chaired

by the Senior Non-Executive Director, an independent non-executive director and nancial expert.

• Best practice provision 2.3.6.ii (vice-chairman): The Company does not comply with best practice

provision 2.3.6.ii, which provides that the non-executive directors elect a vice-chairman. The Company

has no vice-chairman, but instead has an Executive Chair and a Senior Non-Executive Director.

• Best practice provision 2.3.10 (company secretary): The Company does not comply with best

practice provision 2.3.10, which provides that a non-executive directors are supported by a company

secretary. No company secretary has been appointed. The non-executive directors are instead

supported by the general counsel and outside counsel.

• Best practice provisions 3.1.2.v (remuneration policy): The Company partly deviates from best

practice provision 3.1.2.vii, which provides that share options cannot be exercised during the rst three

years after they are awarded. The Company grants rights to shares in the form of restricted share

units with a four-year vesting schedule, part of which vest before, and part of it vest after, the third

anniversary of the award, which is in line with the market practice for restricted share unit plans and

applies in the same way to other eligible employees of the Company.

• Best practice provision 3.2.3 (severance payments): The Company does not comply with best

practice provision 3.2.3, which provides that the remuneration of executive directors in the event of

dismissal should not exceed one year’s salary (the ‘xed’ remuneration component). The agreement

of the Executive Chair provides for an agreed compensation and benets through 31 December 2023

upon termination of his position as Executive Chair. This compensation was agreed with the Executive

Chair before the Company’s shares were listed on a regulated market and the Company wishes to full

existing arrangements.

• Best practice provisions 3.3.2 (remuneration non-executive directors): The Company does not

comply with best practice provision 3.3.2, which provides that non-executive directors may not be

awarded remuneration in the form of shares and/or rights to shares. The non-executive directors will

receive their remuneration in the form of restricted share units to ensure alignment between the non-

executive directors and the Company’s value creation.

2021 Annual Report 65

• Best practice provisions 4.3.3 (cancelling the binding nature of a nomination or dismissal):

The Company does not comply with best practice provision 4.3.3, which provides that the general

meeting of shareholders of a company not having statutory two-tier status (structuurregime) may

pass a resolution to cancel the binding nature of a nomination for the appointment of an executive or

non-executive director by an absolute majority of the votes cast. It may be provided that this majority

should represent a given proportion of the issued capital, which proportion may not exceed one-third.

To respect the interests of the founder, the Company’s articles of association provide that the general

meeting may at all times overrule the binding nature of such a nomination by a resolution adopted by

a majority of at least half of the votes cast, provided such majority represents more than half the issued

share capital of the Company.

Disclosures pursuant to decree article 10 EU-Directive on takeovers

In accordance with the Dutch Takeover Directive (Article 10) Decree (Besluit artikel overnamerichtln, the

“Decree”), the Company makes the following disclosures:

a As of 31 December 2021, the issued share capital of the Company consisted of 302,558,555 shares

with a par value of €0.01 each. As of 31 December 2021, the Company owned no treasury shares

and entered into a commitment to buy back 1,625,236 shares. Treasury shares are not entitled to

dividend and there are no voting rights attached to these shares. For information on the rights

attached to shares reference is made to the articles of association which can be found on the

Company’s website. To summarize, the rights attaching to shares comprise pre-emptive rights

upon the issue of shares, the right to attend general meetings of the Company and to speak and

vote at such meetings and to resolve on and the entitlement to the distribution of such amount of

the Company’s prot as remains after allocation to the reserves. All shares rank pari passu and

will have equal rights and obligations with respect to all matters.

b The Company has imposed no limitations on the transfer of shares. Part of the Company’s

shares are held by Stichting Administratiekantoor Meltwater Holding, a Dutch foundation (the

“Foundation”), who issued Dutch depositary receipts for Company shares (certicaten van

aandelen, “STAK DRs”) to eligible employees and contractors in accordance with the Company’s

stock purchase plan adopted in December 2008, as amended in 2010 and 2011 (the “SPP”).

Pursuant to the SPP, a restricted period may be imposed during which period a participant

may not transfer or create any encumbrance over any STAK DR. Generally, STAK DRs are freely

transferable once they are vested.

c For information on participations in the capital of the Company for which a disclosure obligation

exists under Sections 5:34, 5:35 and 5:43 of the Dutch Financial Supervision Act (Wet op het

nancieel toezicht), please see the section ‘Major shareholders’ in this governance report. There

you will nd a list of shareholders who are known to the Company to have holdings of three

percent or more at the stated date.

d No special control rights or other rights accrue to shares in the capital of the Company.

e In accordance with the SPP, the Foundation issued STAK DRs to employees and contractors.

The Board of directors of Meltwater manages the SPP. The Foundation enables the Company to

separate the benecial and economic rights from the voting rights of the Company’s shares by

issuing STAK DRs for each Company share it holds. The holders of the STAK DRs are entitled to

the benecial and economic rights of the Company shares and the board of the STAK is entitled

to exercise the voting rights attached to the Company shares. While the shares are held by the

Foundation on trust, pursuant to the SPP the Foundation shall take all reasonable steps in respect

of any vote on the shares to seek and comply with any direction from any of the participants as to

2021 Annual Report 66

the exercise of such voting rights on the shares which correspond to the Participant’s STAK DRs.

f No restrictions apply to voting rights attached to the shares in the capital of the Company. No

shareholder will have any voting rights dierent from any other shareholders. The articles of

association allow the Company to cooperate in the issuance of registered depositary receipts for

shares, but only pursuant to a resolution to that eect by the Board of directors.

g The Company is not aware of the existence of any agreements with shareholders of the Company

which may result in restrictions on the transfer of shares or depositary receipts or the limitation of

voting rights, other than the SPP.

h The rules governing the appointment and dismissal of directors are stated in the articles of

association. All directors are appointed by the general meeting. The Board of directors nominates

a candidate for each vacant seat. A nomination by the Board of directors will be binding as

described above in the section ‘Appointment, suspension and dismissal of directors. Directors are

appointed for a period of time to be determined by the general meeting.

The general meeting may at any time dismiss or suspend any director. If the Board of directors

proposes the dismissal of a director to the general meeting, the general meeting can resolve upon

such dismissal by resolution adopted by an absolute majority of the votes cast.

If the Board of directors has not made a proposal for the dismissal of a director, the general

meeting can only resolve upon the dismissal of such director by resolution adopted by majority of

at least half of the votes cast, representing more than half of the issued capital of the Company.

Executive directors may at all times also be suspended by the Board of directors.

The rules governing an amendment of the articles of association are included in article 29 of the

articles of association and require a resolution of the general meeting.

i The general powers of the Board of directors are stated in articles 15.6 and 15.7 of the articles

of association. Pursuant to article 18.1 of the articles of association, the general authority to

represent the Company is vested in the Board of directors, the Executive Chair, acting solely and

all executive directors acting jointly.

The Board of directors has been granted the authority to issue shares and to limit or exclude pre-

emptive rights as described above in the section ‘Issuance of shares and pre-emptive rights’.

The Company is entitled to acquire fully paid-up shares in its capital. The terms and conditions

for the acquisition of shares by the Company in its capital are set out in article 9 of the articles

of association. The Board of directors has been granted the authority for a period of 18 months

commencing 7 December 2021, to acquire, in one or more transactions, fully paid shares or

depositary receipts (whether or not listed) in the Company’s capital either through a purchase on

a multilateral trading facility, stock exchange or otherwise up to a maximum of 10% of the total

issued share capital of the Company as at the calendar day following the date of conversion, for

a minimum price, excluding expenses, of the nominal value of the shares or depositary receipts

concerned and a maximum price equal to 110% of:

(x) the volume weighted average trading price, as quoted on Oslo Børs of the shares or

depositary receipts, the so-called VWAP, during a specied period not exceeding 15 trading

days ending on a specied date prior the date of repurchase (such period and such date

to be determined by the Board of directors, which period shall fall within the two-month

period prior the date of repurchase); or

(y) for accelerated repurchase arrangements, the VWAP for over the term of the arrangement.

2021 Annual Report 67

j The Company is not a party to any signicant agreements which will take eect, will be altered

or will be terminated upon a change of control of the Company as a result of a public oer

within the meaning of section 5:70 of the Dutch Financial Supervision Act (Wet op het nancieel

toezicht), provided that the facility agreement entered into by the Company with DNB Bank ASA

contains clauses that, as is customary for nancing agreements of similar type, may require early

repayment or termination in the event of a change of control of the Company.

k The Company did not enter into any agreement with a director or employee of the Company

providing for a payment upon the termination of employment as a result of a public oer within

the meaning of section 5:70 of the Dutch Financial Supervision Act (Wet op het nancieel toezicht).

2021 Annual Report 68

Report of Non-executive Directors

This is the report of the non-executive directors

of the Company over the nancial year 2021, as

referred to in best practice provision 5.1.5 of the

Dutch Code.

The Board of directors is a one-tier board,

comprising both members having responsibility

for the day-to-day management of the company

(executive directors) and members not having

such day-to-day responsibility (non-executive

directors). The tasks of the executive and non-

executive directors in a one-tier board such as

the Board of directors may be allocated under or

pursuant to the articles of association, provided

that the general meeting has stipulated whether

such director is appointed as executive or as non-

executive director and furthermore provided that

the task to supervise the performance by the

directors of their duties can only be performed

by the non-executive directors. Regardless of an

allocation of tasks, all directors remain collectively

responsible for the proper management and

strategy of the company (including supervision

thereof in case of non-executive directors).

It is the responsibility of the non-executive

directors to supervise the policies carried out by

the executive directors and the general aairs

of the Company and its aliated enterprise,

including the implementation of the strategy

of the Company regarding long-term value

creation. In so doing, the non-executive directors

act solely in the interest of the Company.

With a view of maintaining supervision on the

Company, the non-executive directors regularly

discuss the Company’s long-term business plans,

the implementation of such plans and the risks

associated with such plans with the executive

director.

Details of the current composition of the Board of

directors, including the non-executive directors,

and its committees are set forth in the sections

“Board of directors” and “Board of directors

committees.”

Supervision by the non-executive directors

The non-executive directors supervise the policies

carried out by the executive directors and the

general aairs of the Company and its aliated

enterprise. In so doing, the non-executive directors

have also focused on the eectiveness of the

Company’s internal risk management and control

systems, the integrity and quality of the nancial

reporting and the Company’s long-term business

plans, the implementation of such plans and the

risks associated.

The responsibility of supervising the policy pursued

by the Board of directors includes evaluating

the way the Board of directors implements

Meltwater’s strategy for long-term value creation

and promotes a culture aimed at creating value.

In the performance of its duties, the directors act

in accordance with the interests of the Company

and weigh up the interests of all stakeholders, in

line with Meltwater’s multi stakeholder approach.

The non-executive directors are condent that the

existing strategy of Meltwater is the right approach

for the long-term success of Meltwater and provide

a sound basis for the future.

Furthermore, the non-executive directors have

examined and monitored each and all stages of the

process of the Uplisting and adopted all relevant

resolutions.

The non-executive directors supervised the

adoption and implementation of the strategies and

policies by the Group, reviewed this annual report,

including the Group’s nancial results and received

updates on legal and compliance matters. The non-

executive directors have also reviewed the reports

of the Board of directors and its committees.

Committees

Furthermore, the Board of directors has allocated

certain specic responsibilities to the audit

committee and the remuneration committee.

Further details on the manner in which these

committees have carried out their duties are set

2021 Annual Report 69

NAME

Board of

directors

IN %

AUDIT COM-

MITTEE

IN %

REMUNERATION

COMMITTEE

IN %

Jørn Lyseggen 6/6 100% – – – –

David Faugno 6/6 100% 5/5 100% 6/6 100%

David Flannery 6/6 100% 3/4 75% 1/2 50%

Mattias Erik

Holmström

6/6 100% – – 5/6 83%

Sang Kim – 100% 1/1 100% – –

Erik Langaker 3/3 100% 2/2 100% – –

Andreas Jan-

Ulrik Säfweräng

3/3 100% – – – –

Stefanie Witte 3/3 100% – – – –

forth in the section ‘Board of directors committees’. The non-executive directors have been regularly

informed by each committee as referred to in best practice provision 2.3.5 of the Dutch Code and the

conclusions of those committees were taken into account when drafting this report of the non-executive

directors.

The Company operated only less than one month as a company listed on a regulated market in 2021. The

non-executive directors will evaluate and supervise the performance of the directors and the committees

for the rst time in 2022.

Attendance at meetings

During the nancial year 2021, there were six meetings of the Board of directors.

The composition of the Board of directors has changed several times during the nancial year 2021 which

explains the dierence in the total number of meetings attended by some of the directors mentioned

below.

• Until 1 January 2021, the Board of directors comprised the following directors: Jørn Lyseggen as

Executive Chair and David Flannery, David Faugno, Mattias Erik Holmström and Andreas Jan-Ulrik

Säfweräng as non-executive directors.

• On 30 June 2021, the Company appointed Erik Langaker and Stefanie Witte as non-executive directors

and Jan-Ulrik Säfweräng resigned as non-executive director.

• On 3 December 2021, the Company appointed Sang Kim as non-executive director and David Flannery

resigned as non-executive director.

An overview of the attendance of the individual directors per meeting of the Board of directors and its

committees set out against the total number of such meetings is set out below:

2021 Annual Report 70

Independence of the non-executive directors

Each non-executive director owes a duty to the Company to properly perform his duties and to act in the

Company’s corporate interest.

The composition of the Board of directors is in compliance with the independence requirements of the

Norwegian Code, meaning that (i) the majority of the shareholder-elected directors are independent from

the Company’s executive management and material business connections, and (ii) at least two of the

shareholder-elected directors are independent from the Company’s main shareholders. In line with the

Dutch Code and the Company’s articles of association, the Board of directors does, however, include one

executive director (Jørn Lyseggen, Executive Chair).

The composition of the Board of Directors is also in compliance with the independence requirements of

the Dutch Code. Pursuant to best practice provisions 2.1.7 and 2.1.8 of the Dutch Code, one non-executive

director does not have to meet the independence criteria as set out in the Dutch Code. In addition, for

each shareholder, or group of aliated shareholders, who directly or indirectly hold more than 10% of

the shares in the Company, there is one non-executive director who may be aliated with or representing

such shareholder. In total, the majority of the non-executive directors should be independent. The non-

executive directors have determined that four of the ve non-executive directors qualify as independent in

accordance with the Dutch Code.

In addition, for each shareholder, or group of aliated shareholders, who directly or indirectly hold more

than 10% of the shares in the Company, there is one non-executive director who may be aliated with or

representing such shareholder. In total, the majority of the non-executive directors should be independent.

The non-executive directors have determined that four of the ve non-executive directors qualify as

independent in accordance with the Dutch Code.

2021 Annual Report 71

Remuneration Report

In December 2021, the Company’s admission to listing and trading on Euronext

Growth Oslo was transferred to a main listing at Oslo Børs (the “Uplisting”) and the

Company was converted from a Dutch private company with limited liability (besloten

vennootschap met beperkte aansprakelkheid) into a Dutch public company with limited

liability (naamloze vennootschap). In connection with the Uplisting, the general meeting

approved a remuneration policy for the Directors on 3 December 2021 and became

eective on 20 December 2021, the date of the Uplisting. The Board of directors has

decided to apply the remuneration policy to the remuneration of the directors as of 1

January 2022.

The remuneration policy aims to contribute to the Group’s business strategy and

is expected to enable the Company to achieve its business objectives. The non-

executive directors are responsible for the implementation and monitoring of the

remuneration policy.

This remuneration report summarizes the guidelines and the principles followed by the

Company in order to dene and implement the remuneration policy. In addition, this

remuneration report provides the remuneration paid to the executive director and the

non-executive directors for the year ended 31 December 2021.

In 2021, the remuneration of the executive director consisted of base salary and other

benets. In 2021, the remuneration of the Senior non-executive director comprised a

xed cash fee per annum. As of 1 January 2022, the remuneration of the executive

director consists of annual base salary, short term incentive, long-term incentive and

other benets. As of 1 January 2022, the remuneration of the non-executive directors

comprises a xed fee per annum, payable in the form of restricted shares units (“RSUs”).

In accordance with Dutch law, the remuneration policy will be submitted to the general

meeting at least every four years, as well as each time in case of amendments to the

remuneration policy. Pursuant to the Company’s articles of association, a resolution of

the general meeting to adopt and amend the remuneration policy requires an absolute

majority of the votes cast.

The remuneration report will be submitted to the general meeting for an advisory vote

as from 2022. The Company will convey any information on how an advisory vote on

the remuneration report has been taken into account in the next annual report.

2021 Annual Report 72

Remuneration policy

The Company’s remuneration policy is based on the following remuneration principles:

a

it aims to recruit, retain and motivate talented and skilled directors while protecting and promoting

the objectives and strategy of the Company and its Group;

b

it provides for a market competitive remuneration package and fosters alignment of interests of

Directors with shareholders and stakeholders;

c

the remuneration reects the Company’s size and complexity, as well as the responsibilities of the

role and the time spent and aims to be consistent with eective risk management policies; and

d

the remuneration intends to reward directors to utilize their skills and competences to the

maximum extent possible to execute the tasks delegated to them including but not limited to tasks

and responsibilities imposed by the Dutch Civil Code and the articles of association.

Even though the Company is not in principle in favor of making exceptions to the principles underlying

the remuneration policy, the Company, upon recommendation of the remuneration committee, shall be

allowed to temporarily derogate from the remuneration policy in exceptional circumstances as dened by

the Dutch Civil Code. Exceptional circumstances only cover situations in which the derogation from the

remuneration policy is necessary to serve the long-term interests and sustainability of the Company as

a whole or to assure its viability, such as the appointment of an interim Director or the appointment of a

new Director.

Remuneration executive director

The authority to establish the remuneration of executive directors is vested with the non-executive

directors, with due observance of the remuneration policy and applicable provisions of law.

As of 1 January 2022, the remuneration of executive directors will consist of annual base salary, annual

performance-related short-term incentive, long-term incentive and other benets.

Annual base salary

The annual base salary, including holiday allowance and other local statutory requirements, is set at a

market competitive level to attract and retain the calibre of executive directors required to devise and

execute the Company’s strategy.

The amount of annual base salary is reviewed annually and in the event of the appointment of a new

executive director by the non-executive directors or the remuneration committee of the Board of directors.

Various factors may be considered when determining any annual base salary changes, including, but

not limited to, salary increases of the Company’s global workforce, business performance, personal

performance, the scope and nature of the role, relevant market benchmark data and local economic

indicators, such as ination and cost-of-living changes, to ensure that the remuneration is fair, sensible

and market competitive.

Short-term incentive

The purpose of the short-term incentive is to ensure executive alignment with and focus on the annual

business plan as set by Board of Directors. Performance measures and targets for those measures are set

by the non-executive directors.

2021 Annual Report 73

The short-term incentive is linked to a percentage of the annual base salary of the executive directors. The

short-term incentive is in principle settled in cash but, in order to encourage ownership and proprietary

interest in the Company, the non-executive directors have the possibility to determine that any short-term

incentive awards are settled in shares in the capital of the Company.

After the end of each year the non-executive directors review the actual performance against the set

performance targets to determine the extent to which each of the targets has been achieved, in order to

determine the nal pay-out level. There is no minimum bonus pay-out. As a consequence, there will be no

bonus pay out if none of the performance thresholds are met.

Long-term incentive

The long-term incentive awards are made available in the form of RSUs. They represent conditional rights

to receive a number of shares in the capital of the Company, subject to continued engagement during the

vesting period.

The RSUs will vest over a period of four years. The RSUs will vest as follows: 25% on the rst anniversary

of the date of appointment; and 75% on a quarterly basis over the following three-year period (6.25% per

quarter) until 100% on the fourth anniversary of the date of appointment.

The award value will be set by the non-executive directors. The maximum award value of RSUs is equal to

50% of the executive director’s annual base salary. RSUs that are unvested at the time a non-executive

director ceases to be a director of the Company as a result of the relevant non-executive director on its

own initiative terminating, resigning or retiring (other than as a result of permanent incapacity due to ill

health) will lapse.

Other benets

Other benets for which the executive directors are eligible are intended to be competitive in the

relevant market and may evolve from year to year. The executive directors may be eligible for benets

such as health insurance, disability and life insurance, a directors’ and ocers’ liability insurance,

mobility allowance or travel expenses, housing allowance, tness allowance, representation costs and to

participate in whatever all-employee benets plans may be oered at any given point.

Additional benets and allowances may be oered to the executive directors in case of a relocation or

an international assignment, such as relocation support, storage costs, expatriation allowance, housing

support, reimbursement of ight costs, reimbursement of costs of temporary living arrangements and

other benets which reect local market practice, all in accordance with the applicable mobility policy.

Scenario analysis

When formulating the remuneration policy and before determining the individual remuneration of the

executive directors, the non-executive directors will conduct analyses of the possible results of the variable

remuneration components and the way in which this aects the remuneration of the executive directors.

Severance

A transition agreement with Jørn Lyseggen (Executive Chair) was entered into on 12 May 2020. This

transition agreement provides that upon termination of his position as Executive Chair, he is entitled to

receive agreed compensation and benets through 31 December 2023. The Company has elected to

respect and maintain this agreement following the Uplisting.

Right to reclaim variable remuneration

In accordance with Dutch law, the non-executive directors may adjust the outcome of variable

compensation of the executive directors if the pay-out would, in their view, be unacceptable based on

2021 Annual Report 74

reasonability and fairness criteria (a ‘malus’). The Company can also claim back variable payments (in

whole or in part) if the pay-out was based on incorrect information about the achievement of the targets

(‘claw back’). In 2021, there was no cause for a claw back or value adjustment by the non-executive

directors.

2021 remuneration

In 2021, the remuneration of the executive director consisted of base salary and other benets. The

executive director did not receive any short-term or long-term incentive. There are no loans, advances or

guarantees provided by the Company or any undertaking belonging to the Group to or on behalf of an

executive director.

The following table summarizes the remuneration received by the executive director for the year ended 31

December 2021 and the previous nancial year ended 31 December 2020.

EXECUTIVE

DIRECTOR,

POSITION

YEAR

FIXED

REMUNERATION

SHORT TERM

INCENTIVE

LONG-TERM

INCENTIVE

1

EXTRAORDINARY

ITEMS

OTHER

BENEFITS

TOTAL

REMUNERATION

PROPORTION

OF FIXED

AND VARIABLE

REMUNERATION

Jørn

Lyseggen,

Executive

Chair

2021 $600,000 – – – $23,909 $623,909

100% xed

0% variable

2020 $600,000 – – – $19,850 $619,850

100% xed

0% variable

(1) Since the Executive Chair did not receive any share-based compensation in 2020 and 2021 and no options or awards were outstanding in these years, no

share-based payment expenses were recognized 2020 and 2021.

Remuneration non-executive directors

The remuneration of the non-executive directors shall be determined by the general meeting, with due

observance of the remuneration policy and applicable provisions of law.

The remuneration of the non-executive directors reects the time spent and responsibilities of their roles

and aims to reward the non-executive directors for utilizing their skills and competences to the maximum

extent possible to execute the tasks delegated to them.

Remuneration components non-executive directors

In 2021, the Senior Non-Executive Director received a xed cash fee. In order to ensure alignment

between the non-executive directors and the Company’s value creation, the non-executive directors will

be rewarded a xed fee only as of 1 January 2022, payable in the form of RSUs. The RSUs represent

conditional rights to receive a number of shares in the capital of the Company, subject to continued

engagement during the vesting period.

The RSUs will vest over a period of four years and the vesting period starts on the date of appointment.

If a participant remains employed with the Company, the RSUs will vest as follows: 25% on the rst

anniversary of the date of appointment; and 75% on a quarterly basis over the following three-year

period (6.25% per quarter) until 100% on the fourth anniversary of the date of appointment. RSUs that are

unvested at the time a non-executive director ceases to be a Director as a result of the relevant Director on

its own initiative terminating, resigning or retiring (other than as a result of permanent incapacity due to

ill health) will lapse.

2021 Annual Report 75

The RSUs to be awarded to the non-executive directors is as follows:

a Senior non-executive director: $200,000 per annum, to be settled in the form of RSUs; and

b other non-executive directors: $100,000 per annum, to be settled in the form of RSUs

The RSUs include any fee for being a member of committee of the Board of directors. The grant value of

the RSUs will be determined based on a 30-day volume weighted average share price prior to each grant.

The non-executive directors will be reimbursed for all reasonable business expenses incurred in the course

of performing their duties, subject to appropriate evidence of payment and VAT receipts.

2021 remuneration

In 2021 three non-executive directors have commenced their rst term as a member of the Board of

directors: Sang Kim, Erik Langaker and Stefanie Witte. Former non-executive director Andreas Jan-Ulrik

Säfweräng resigned as per 30 June 2021 and former non-executive director David Flannery resigned as

per 3 December 2021.

In 2021, only David Faugno received remuneration. The other non-executive directors will receive

remuneration in accordance with the remuneration policy as of 1 January 2022. There are no loans,

advances or guarantees provided by the Company or any undertaking belonging to the Group to or on

behalf of a non-executive director.

In 2021, David Faugno received a xed cash fee of $90,000 (2020: $90,000). On 11 August 2019, David

Faugno was awarded stock options for which the Company recorded stock-based compensation expense

in the amount of $134,192 (2020: 269,641), in total $224,192 (2020: $359,641). The cost of stock-based

awards granted is measured at the grant date, based on the fair value of the award, and is recognized

as expense on a straight-line basis over the requisite service period from 11 August 2019 to 1 July 2023. The

fair value of stock-based awards to employees is estimated using the Black-Scholes option-pricing model.

The following table shows a comparison of the total remuneration of non-executive directors who served

as Directors in 2021 since the year of the Company’s Uplisting.

NON-EXECUTIVE DIRECTOR

2020 2021

David Faugno

1

$359,641 $224,192

David Flannery – –

Mattias Erik Holmström – –

Sang Kim – –

Erik Langaker – –

Andreas Jan-Ulrik Säfweräng – –

Stefanie Witte – –

(1) These amounts include the stock compensation expense recorded from the option grant made in 2019

2021 Annual Report 76

The following table includes an overview of the outstanding options in 2021:

NON-

EXECUTIVE

DIRECTOR

MAIN CONDITIONS OF SHARE OPTION PLANS

INFORMATION REGARDING 2021

OPENING

BALANCE

DURING

THE YEAR

CLOSING

BALANCE

Plan

Award

date

Vesting

period

Expiration

date

Exercise

period

Strike

price

of the

share

Share options

awarded at the

beginning of

the year

Share

options

awarded

Share

options

vested

Share

options

awarded

and

unvested

Share

options

vested

but not

exercised

David Faugno 2011 EIP

1

11 Aug

2019

Monthly

over 4

years

10 Aug

2029

10 years $1.94 862,400 0 215,600 341,400 521,000

David

Flannery

– – – – – – – – – – –

Mattias Erik

Holmström

– – – – – – – – – – –

Sang Kim – – – – – – – – – – –

Erik Langaker – – – – – – – – – – –

Andreas

Jan-Ulrik

Säfweräng

– – – – – – – – – – –

Stefanie

Witte

– – – – – – – – – – –

(1) 2011 Equity Incentive Plan

The non-executive directors held no RSUs in 2021.

2021 Annual Report 77

Change of remuneration of executive directors and Company performance

The following table shows a comparison of the total remuneration of Directors who served as Directors in

2021 since the year of the Company’s Uplisting.

2020 2021

Executive director’s remuneration

Jørn Lyseggen

(Executive Chair)

$619,850 $623,909

Company performance

Annual Recurring Revenue

Growth

$6,603,900 $73,207,761

Revenue Growth $13,960,550 $41,837,434

Adjusted EBITDA Margin

Growth

$24,400,732 $2,170,801

Average remuneration on a full-time equivalent basis of employees

Employees of the Netherlands $87,224 $89,762

Employees of the Group $106,829 $87,743

Internal pay ratio executive director

Jørn Lyseggen

(Executive Chair)

5.80 7.11

Internal pay ratio

In accordance with Dutch law and the Dutch Corporate Governance Code, the internal pay ratio is an

important factor for determining the remuneration policy. The internal pay ratio set out above is calculat-

ed as the total remuneration of the Executive Chair divided by the average employee compensation of all

employees of the Group (excluding the Executive Chair) under IFRS principles. For 2021, the internal pay

ratio is in line with the Company’s acceptable bandwidths.

2021 Annual Report 78

Financial Statements

2021

Meltwater N.V. – Annual consolidated and company only financial statements 2021

79

Annual consolidated and company only financial statements for the year

ended 31 December 2021

Contents

Consolidated statement of financial position as at 31 December 2021

..................... 82

Consolidated statement of profit or loss and other comprehensive income for the

year ended 31 December 2021

....................................................................................... 83

Consolidated statement of changes in equity for the year ended 31 December 2021

......................................................................................................................................... 84

Consolidated statement of cash flows for the year ended 31 December 2021

.......... 86

Notes to the annual consolidated financial statements

.............................................. 88

1.

General information

............................................................................................... 88

2.

Basis of preparation

............................................................................................... 89

3.

Significant accounting policies

............................................................................. 91

4.

Property, plant and equipment and right-of-use assets

.................................... 107

5.

Intangible assets (including goodwill)

................................................................ 109

6.

Goodwill

................................................................................................................ 112

7.

Leases

.................................................................................................................... 114

8.

Financial assets at fair value through profit and loss and amortized cost

...... 115

9.

Trade receivables

................................................................................................. 116

10.

Other current assets

......................................................................................... 116

11.

Contract costs

.................................................................................................. 116

12.

Cash and cash equivalents

............................................................................. 117

13.

Share capital

.................................................................................................... 117

14.

Other reserves

.................................................................................................. 119

15.

Employee benefit obligations

.......................................................................... 119

16.

Share-based payments

.................................................................................... 125

17.

Trade and other payables

............................................................................... 130

18.

Borrowings

........................................................................................................ 130

19.

Other non-current liabilities

............................................................................. 131

20.

Contingent asset

.............................................................................................. 132

21.

Contingent liabilities

........................................................................................ 132

22.

Revenue from contracts with customers

......................................................... 133

23.

Personnel costs

................................................................................................. 135

24.

Material profit and loss items

.......................................................................... 136

25.

Finance costs

.................................................................................................... 136

26.

Finance income

................................................................................................ 137

27.

Income tax

......................................................................................................... 137

28.

Earnings/(loss) per share

................................................................................. 140

29.

Related parties

................................................................................................. 141

30.

List of subsidiaries

............................................................................................ 142

31.

Fair value measurement

................................................................................... 144

32.

Financial risk management

............................................................................. 145

33.

Financing activities

.......................................................................................... 153

34.

Operating segments

......................................................................................... 155

Meltwater N.V. – Annual consolidated and company only financial statements 2021

80

35.

Standards issued but not yet effective

........................................................... 155

36.

Business combinations

..................................................................................... 155

37.

Subsequent events

........................................................................................... 162

Company only statement of financial position as at 31 December 2021

................. 164

Company only statement of profit or loss and other comprehensive income for the

year ended 31 December 2021

..................................................................................... 165

Company only statement of changes in equity for the year ended 31 December 2021

....................................................................................................................................... 166

Company only statement of cash flows for the year ended 31 December 2021

..... 168

Notes to the annual company only financial statements

.......................................... 169

38.

General information

......................................................................................... 169

39.

Financial assets-investments in subsidiaries

.................................................. 170

40.

Intangible assets

.............................................................................................. 170

41.

Related party receivables

................................................................................ 171

42.

Financial assets at fair value through profit and loss

................................... 171

43.

Current and non-current liabilities

.................................................................. 172

44.

Business combinations

..................................................................................... 172

45.

Other current assets

......................................................................................... 172

46.

Other non-current assets

................................................................................. 173

47.

Cash and cash equivalents

............................................................................. 173

48.

Share capital

.................................................................................................... 173

49.

Company equity reconciliation to consolidated financials

.......................... 174

50.

Borrowings

........................................................................................................ 176

51.

Fair value measurement

................................................................................... 176

52.

Related parties

................................................................................................. 178

53.

Income tax

......................................................................................................... 179

54.

Share-based payments

.................................................................................... 181

55.

Trade and other payables

............................................................................... 181

56.

Personnel costs

................................................................................................. 181

57.

Other income

.................................................................................................... 181

58.

Contingent asset

.............................................................................................. 181

59.

Contingent liabilities

........................................................................................ 182

60.

Financial risk management

............................................................................. 182

61.

First time adoption of IFRS

............................................................................... 189

62.

Subsequent events

........................................................................................... 197

Other information

......................................................................................................... 198

Profit appropriation according to the Articles of Associations

.................................. 198

Independent Auditor's report ................................................................................. 199

Meltwater N.V. – Annual consolidated and company only financial statements 2021

81

2021

Meltwater N.V.

Annual consolidated financial

statements

Meltwater N.V. – Annual consolidated and company only financial statements 2021

82

Consolidated statement of financial position

as at 31 December 2021

Notes

31

December

2021

$‘000

31

December

2020

$‘000

Assets

Non-current assets

Goodwill

5/6

80 427

16 285

Other intangible assets

5

60 633

42 469

Property, plant and equipment

4

3 656

3 373

Right-of-use assets

4

25 615

29 959

Financial assets at fair value through

profit and loss

8

1 292

2 036

Financial assets at amortized cost

8

10 891

5 267

Contract costs

11

25 690

20 980

Deferred tax asset

27

8 586

4 289

Total non-current assets

216 790

124 658

Current assets

Trade receivables

9

88 152

75 749

Other current assets

10

23 854

15 828

Contract costs

11

32 491

25 470

Cash and cash equivalents

12

44 387

99 927

Total current assets

188 884

216 974

Total assets

405 674

341 632

Liabilities

Non-current liabilities

Borrowings

18

25 046

-

Lease liabilities

7

19 969

23 254

Contract liabilities

22

10 585

11 168

Other non-current liabilities

19

13 576

-

Deferred tax liability

27

13 825

7 005

Employee benefit obligation

15

423

334

Total non-current liabilities

83 424

41 761

Current liabilities

Borrowings

18

13

-

Trade and other payables

17

122 901

114 674

Contract liabilities

22

234 821

206 097

Lease liabilities

7

9 928

10 258

Current tax liabilities

27

1 588

3 424

Employee benefit obligation

15

104

127

Total current liabilities

369 355

334 580

Total liabilities

452 779

376 341

Equity

Share capital

13

3 421

29

Share premium

13

417 255

351 657

Accumulated deficit

(464 233)

(386 295)

Other reserves

14

(3 548)

(100)

Total equity

(47 105)

(34 709)

Total equity and liabilities

405 674

341 632

Meltwater N.V. – Annual consolidated and company only financial statements 2021

83

Consolidated statement of profit or loss and other comprehensive

income for the year ended 31 December 2021

Notes

2021

$’000

2020

$’000

Revenue from contracts with customers

22

401 628

359 791

Cost of sales

(119 731)

(105 504)

Gross profit

281 897

254 287

Sales and marketing expenses

(221 188)

(177 813)

General and administrative expenses

(80 537)

(51 580)

Research and development expenses

(58 365)

(37 952)

Other income

16

42

Operating profit/(loss)

(78 177)

(13 016)

Finance costs

25

(4 865)

(60 791)

Foreign exchange gain/(loss)

5 454

(5 479)

Finance income

26

432

3 919

Profit/(loss) before tax

(77 156)

(75 367)

Income tax benefit/ (expense)

27

(782)

(624)

Profit/(loss) for the year

(77 938)

(75 991)

Profit/(loss) attributable to:

Shareholders

(77 938)

(75 991)

Earnings/(loss) per share for profit

attributable to the ordinary equity holders of

the Company

Basic earnings/(loss) per share

28

(0.26)

(0.31)

Diluted earnings/(loss) per share

28

(0.26)

(0.31)

Other comprehensive income

Items that may be reclassified to profit and

loss, net of tax

Exchange difference on translation of foreign

operations

Items that will not be reclassified to profit or

loss

(3 467)

1 688

Remeasurements of defined benefit obligation

14

19

60

Total other comprehensive income/(loss)

(3 448)

1 748

Total comprehensive income/(loss)

(81 386)

(74 243)

Attributable to:

Shareholders

(81 386)

(74 243)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

84

Consolidated statement of changes in equity for the year ended 31 December 2021

Share capital

$’000

Share premium

$’000

Other reserves

$’000

Accumulated deficit

$’000

Total equity

$’000

Notes

13

14

Balance as of 1 January 2020

24

105 179

(1 911)

(310 241)

(206 949)

Loss for the period

-

(75 991)

Foreign currency translation adjustments

1 751

(63)

1 688

Remeasurements of defined benefit obligation

-

60

-

60

Total comprehensive income / (loss)

-

1 811

(76 054)

(74 243)

Share-based compensation expense

-

5 769

-

5 769

Share-based compensation tax

-

1 681

-

1 681

Issuance of common shares in connection with Euronext

Growth (Merkur) Oslo Børs offering, net of issuance cost

5

237 536

-

237 541

Issuance of Series A common shares

upon exercise of option

-

1 088

-

1 088

Issuance of Series A common shares

upon exercise of warrant

-

Issuance of Series A common shares in

consideration for acquisition

-

404

-

404

Total other movements

5

246 478

-

246 483

Balance as of 31 December 2020

29

351 657

(100)

(386 295)

(34 709)

- -

Meltwater N.V. – Annual consolidated and company only financial statements 2021

85

Balance as of 31 December 2020

29

351 657

(100)

(386 295)

(34 709)

Loss for the period

-

(77 938)

Foreign currency translation adjustment

-

(3 467)

-

(3 467)

Remeasurements of defined benefit obligation

-

19

-

19

Total comprehensive income

-

(3 448)

(77 938)

(81 386)

Share-based compensation expense

-

60 425

-

60 425

Share-based compensation tax

-

(1 218)

-

(1 218)

Issuance of common shares in connection with Euronext

Growth (Merkur) Oslo Børs offering, net of issuance cost

-

(35)

-

(35)

Issuance of Series A common shares

upon exercise of option

5

5 475

-

5 480

Issuance of Series A common shares in

consideration for acquisition

1

16 553

-

16 554

Issuance of Series A common shares in

consideration for post combination services

-

1 527

-

1 527

Change in par value of share capital

3 404

(3 404)

-

Issuance of Series A common shares, other

-

895

-

895

Repurchase of series A common shares

(18)

(5 146)

-

(5 164)

Repurchase of equity securities

-

(9 474)

-

(9 474)

Total other movements

3 392

65 598

-

68 990

Balance as of 31 December 2021

3 421

417 255

(3 548)

(464 233)

(47 105)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

86

Consolidated statement of cash flows for the year ended 31 December 2021

Notes

2021

$’000

2020

$’000

Cash flows from operating activities

Net profit/(loss) before tax

(77 156)

(75 367)

Adjustments for:

Depreciation of right-of-use-assets

4

11 149

11 196

Depreciation of property, plant and equipment

4

1 707

2 769

Amortization of other intangible assets

5

11 274

10 600

Amortization of capitalized software costs

5

11 075

10 323

Impairment of capitalized software costs

5

2 729

1 100

Amortization of debt discount and financing cost

239

-

Share-based compensation expense

16

60 425

5 769

Loss on loan extinguishment

25

-

34 346

Interest paid

(4 656)

(32 206)

Interest expense accrued

4 626

27 262

Interest received

-

6 951

Unrealised FX (gains)/losses relating to working capital

items

(7 320)

6 617

Tax (paid)/received

(4 694)

(1 315)

Share-based compensation expense related to post

combination services

1 527

-

Changes in working capital items:

Decrease/ (increase) in trade receivables

9

(10 472)

5 619

Decrease/ (increase) in other current assets

10

(1 908)

1 281

Decrease/(increase) in contract costs

11

(13 198)

(1 888)

(Decrease)/increase in contract liabilities

22

28 372

832

(Decrease)/increase in trade and other payables

(6 499)

20 700

(Decrease)/increase in employee benefit obligation

(98)

25

Cash generated from / (used in)

operating activities

7 122

34 614

Cash flows from investing activities

Payments for acquisition of property and equipment

4

(1 894)

(2 276)

Related party loans

-

28 100

Proceeds from sale of property and equipment

-

50

Capitalized software development costs

and other intangible assets

(12 106)

(10 590)

Amounts paid for business combinations,

net of cash acquired

(49 565)

-

Proceeds from sale of minority interest investment

60

-

Cash generated from / (used in)

investing activities

(63 505)

15 284

Cash flows from financing activities

Proceeds from borrowings

25 000

Payments of debt issuance cost

(638)

-

Repayment of non-convertible borrowings

-

(200 000)

Payment of loss on loan extinguishment

-

(30 587)

Proceeds from issuance of common shares

5 480

1 088

Meltwater N.V. – Annual consolidated and company only financial statements 2021

87

(Payments)/ Proceeds from Euronext Growth (Merkur)

Oslo Børs offering, net of issuance costs

(10 674)

248 404

Purchase of equity shares

(6 927)

-

Payment of principal portion on lease

liability

(10 437)

(10 648)

Cash generated from / (used in)

financing activities

1 804

33 257

Net increase in cash and cash

equivalents

(54 579)

83 155

Effects of foreign exchange rates

(961)

1 408

Cash and cash equivalents at the

beginning of the year

99 927

15 364

Cash and cash equivalents at the end

of the year

44 387

99 927

Meltwater N.V. – Annual consolidated and company only financial statements 2021

88

Notes to the annual consolidated financial statements

1.

General information

1.1

Operations

Meltwater N.V. (the “Company”) and its subsidiaries (the “Group”, or “Meltwater”) is a group of

companies founded in Norway. The Company has its statutory seat in Amsterdam, The

Netherlands. The Company is listed on the Oslo Børs in Oslo, Norway. The address of the

Company’s registered office is Singel 250, 1016 AB, Amsterdam. The registration number of the

Company at the Chamber of Commerce is 32109376.

The operations of the Group are mainly comprised of providing cloud-based news, social media

monitoring and related services.

In 2020 the Company changed its name from Meltwater Holding B.V. to Meltwater B.V.

On 3 December 2021 the general meeting of Meltwater B.V. approved the conversion of the

Company to a public limited company in the Netherlands (naamloze vennootschap) (N.V.). This

conversion was effected on 6 December 2021 through a change in the articles of association.

Additionally, the par value of the shares was changed from USD 0.001 per share to EUR 0.01 per

share resulting in an increase of the paid share capital to EUR 3 million, the increase being

funded from share premium. As of 6 December 2021, the name of the entity changed to

Meltwater N.V.

1.2 Going concern

The consolidated financial statements have been prepared on a going concern basis. For 2021,

the Company ended with total revenues of $401.6 million (2020: $359.8 million) with a net loss

of $77.9 million (2020: net loss of $76.0 million). As a result of the losses in 2021 and previous

years, the Company has a negative equity of $47.1 million (2020: $34.7 million). The negative

equity is reduced due to the additional paid-in capital of $417.3 million (2020: $351.7 million).

As of 31 December 2021, current liabilities exceeded current assets by $180.5 million, of which

$234.8 million of current liabilities consists of the current portion of contract liabilities, most of

which will not be settled in cash. Cash provided by operating activities was $7.1 million positive

and $34.6 million positive during the years ended 31 December 2021 and 2020, respectively.

The Company’ s cash and cash equivalents balance as of 31 December 2021 was $44.4 million

(Note 12).

In December 2020, the Company completed the Euronext Growth (Merkur) Oslo Børs offerings.

Upon completion, the Company repaid the 2019 Note Payable balance. The repayment of the

2019 Note Payable resulted in the application of extinguishment accounting, whereby, the

difference between the reacquisition price of the debt and its net carrying amount was

recognized in the period of extinguishment. For the year ended 31 December 2020, the Company

recorded a loss on loan extinguishment totalling $34.3 million.

In December 2020, the Company entered into a multi-currency revolving credit facility (the

“2020 Credit Facility”) of $150.0 million. The maturity date of the 2020 Credit Facility is three

years from when the first utilization occurs with an option to extend an additional one to two

years. Interest accrues on amounts outstanding under the 2020 Credit Facility at LIBOR plus a

margin range of 1.50% to 2.00% per annum. The Company is required to meet certain covenants

in relation to the 2020 Credit Facility. The covenants were mainly related to the achievement of

a financial leverage ratio. As of 31 December 2020, the Company had not drawn any borrowings

Meltwater N.V. – Annual consolidated and company only financial statements 2021

89

under the 2020 Credit Facility and had the ability to borrow $150.0 million under the 2020 Credit

Facility.

In June 2021, the Company drew down $25 million from the Revolving Credit Facility which

remained outstanding as of 31 December 2021. In September 2021 Meltwater utilized the option

to extend the due date by one year making the outstanding amount wholly due and payable by

9 June 2025.

Management believes that the cash balances and the credit facility available as of 31 December

2021 and the funds generated from future operations will enable the Company to meet its cash

requirements for the foreseeable future (at least twelve months from the date of these financial

statements).

COVID-19 pandemic

The COVID-19 pandemic has developed rapidly in 2020 and continued in 2021, with a significant

number of cases. Measures taken by various governments to contain the virus have affected

economic activity. The Company has taken a number of measures to monitor and mitigate the

effects of COVID-19, such as safety and health measures for the Company’s people (such as

social distancing and working from home). In every country the Company operate, there are

promising signs of abetment of Omicron variants and governmental authorities are gradually

relaxing COVID-19 restrictions. At this stage, the impact on the business and results has not been

significant and based on the Company’s experience to date we expect this to remain the case.

As the Company operates in media intelligence and analytics business, the Company has found

increased demand for their services and expect this to continue. The Company will continue to

follow the various government policies and advice and, in parallel, they will do their utmost to

continue the Company’s operations in the best and safest way possible without jeopardising

the health of our people.

As of 31 December 2021, and to the date that these financial statements have been issued, there

has been no significant impact from COVID-19 on the Company’s operating results or financial

position.

2.

Basis of preparation

2.1

Accounting basis

These annual consolidated financial statements have been prepared in accordance with

International Financial Reporting Standards (“IFRS”) as adopted by the European Union (“EU”),

hereafter IFRS-EU or IFRS.

The annual consolidated financial statements have been prepared on the historical cost basis

unless otherwise indicated.

The significant entities that are part of the Group are disclosed in Note 30.

The annual consolidated financial statements were authorized for issue by the Board of

Directors on 26 April 2022.

2.2

Functional and presentation currency

Items included in the financial statements of each of the group’s entities are measured using the

currency of the primary economic environment in which the entity operates (‘the functional

currency’). These annual consolidated financial statements are presented in US Dollar ($), which

is the Company’s functional and presentation currency. All amounts have been rounded to the

nearest thousand ($’000), unless otherwise indicated. The Basic and Diluted earnings (loss) per

Meltwater N.V. – Annual consolidated and company only financial statements 2021

90

share as presented in the Consolidated statement of profit or loss and other comprehensive

income have been presented in cents.

2.3

Use of estimates and judgements

The preparation of these annual consolidated financial statements in conformity with IFRS

requires management to make estimates and assumptions, which affect the reported amounts

in these annual consolidated financial statements. Estimates are based on historical experience,

where applicable, and other assumptions which management believes are reasonable under the

circumstances. The Group evaluates its estimates on an ongoing basis. These estimates are

inherently subject to judgement and actual results could differ from those estimates. Revisions

to accounting estimates are recognized prospectively.

Information about significant judgements and estimates used are included in the relevant notes

to the financial statements.

The areas involving significant estimates and judgements are:

Significant estimates and judgements:

• Determining the lease term of contracts with renewal and termination options (Note 7)

• Capitalization of development costs (Note 3.6.1)

• Estimated useful life of intangible assets (Note 3.6.3)

• Estimation of the incremental borrowing rate (‘IBR’) applied to lease accounting

(Note 7);

• Estimation of the loss allowance for expected credit losses (Note 32)

• Estimation of the recoverable amounts of cash generating units for impairment

of goodwill (Note 6)

• Valuation of share-based payments (Note 16)

• Valuation of deferred tax assets and liabilities (Note 27);

• Estimation of fair values of contingent purchase consideration in a business

combination (Note 3.2);

• Estimation of fair values of intangible assets acquired as part of a business

combination and subsequent measurement thereof (Note 3.2)

• Recognition of deferred tax asset for carried-forward tax losses (Note 3.21.2)

2.4

New and amended IFRS Standards that are effective for the current year

In the current year, the Company adopted the Phase 2 amendments Interest Rate Benchmark

Reform- Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16. Adopting these amendments

enables the Company to reflect the effects of transitioning from interbank offered rates

(“IBOR’’) to alternative benchmark interest rates (also referred to as “ risk free rates’’ or “RFRs’’)

without giving rise to accounting impacts that would not provide useful information to users of

financial statements. The Company has not restated the prior period, instead, the amendments

are applied retrospectively with any adjustments being recognized in the appropriate

components of equity. There has been no impact to the financial year ended 31 December 2021

as referred to the table below.

Details of non-derivative financial instruments affected by the interest rate benchmark reform

together with a summary of the actions taken by the Company to manage the risks relating to

the reform and the accounting impact thereof:

Meltwater N.V. – Annual consolidated and company only financial statements 2021

91

Non- derivative

financial

instrument prior

to transition

Date of Maturity

Nominal currency

Total nominal

value

Transition

progress for non-

derivative

financial

instruments

Bank borrowings

linked to USD

LIBOR

2025

USD

150,000,000

Transition

required before

June 2023

Progress towards implementation of alternative benchmark interest rates

The Company is in communication with the relevant financial institutions regarding the

reformation related to the above instruments.

The changes are expected to be finalised in 2022.

3.

Significant accounting policies

3.1

Basis of consolidation

The annual consolidated financial statements incorporate the financial statements of the

Company and entities controlled by the Company (its subsidiaries) made up to 31 December

each year. Control is achieved when the Company:

• has the power over the investee;

• is exposed, or has rights, to variable returns from its involvement with the investee; and

• has the ability to use its power to affect its returns.

Subsidiaries are entities over which the Group has control. Subsidiaries are fully consolidated

from the date on which control is transferred to the Group and are deconsolidated as soon as

control ceases.

All intercompany balances, transactions, income and expenses and profits and losses resulting

from transactions between Group companies are eliminated. Accounting policies of subsidiaries

are changed where necessary to ensure consistency with the policies adopted by the Group.

Unrealised losses are also eliminated unless the transaction provides evidence of an impairment

of the transferred asset.

3.2

Business combinations

Acquisitions of businesses are accounted for using the acquisition method. The consideration

transferred in a business combination is measured at fair value, which is calculated as the sum

of the acquisition-date fair values of assets transferred by the Group, liabilities incurred by the

Group to the former owners of the acquiree and the equity interest issued by the Group in

exchange for control of the acquiree. Acquisition-related costs are recognized in profit or loss as

incurred if the costs do not relate to the issuance of debt or equity instruments. The Company’s

estimates are inherently uncertain and subject to refinement. During the measurement period,

which may be up to one year from the acquisition date, the Company may record adjustments

to the fair value of these tangible and intangible assets acquired and liabilities assumed, with

the corresponding offset to goodwill.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

92

At the acquisition date, the identifiable assets acquired, the liabilities and contingent liabilities

assumed are recognized at their fair value at the acquisition date. The Group recognizes any

non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at

fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net

identifiable assets.

Contingent consideration is classified either as equity or a financial liability. Amounts classified

as a financial liability are subsequently remeasured to fair value, with changes in fair value

recognized in profit or loss.

Goodwill is measured as the excess of the sum of the consideration transferred and the fair

value of the acquirer’s previously held equity interest in the acquiree (if any) and the amount of

any non-controlling interest in the acquiree over the net of the acquisition-date amounts of the

identifiable assets acquired and the liabilities assumed.

If the initial accounting for a business combination is incomplete by the end of the reporting

period in which the combination occurs, the Group reports provisional amounts for the items for

which the accounting is incomplete. Those provisional amounts are adjusted during the

measurement period (see above), or additional assets or liabilities are recognized, to reflect new

information obtained about facts and circumstances that existed as of the acquisition date that,

if known, would have affected the amounts recognized as of that date.

3.3

Goodwill

Goodwill is initially recognized and measured as set out above.

Goodwill is not amortized but is reviewed for impairment at least annually. For the purpose of

impairment testing, goodwill is allocated to each of the Group’s cash-generating units (or

groups of cash-generating units) expected to benefit from the synergies of the combination. For

the purposes of assessing impairment, assets are grouped at the lowest levels for which there

are separately identifiable cash inflows which are largely independent of the cash inflows from

other assets or groups of assets (cash-generating units). Cash-generating units to which

goodwill has been allocated are tested for impairment annually, or more frequently when there

is an indication that the unit may be impaired. If the recoverable amount of the cash-generating

unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce

the carrying amount of any goodwill allocated to the unit and then to the other assets of the

unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss

recognized for goodwill is not reversed in a subsequent period.

On disposal of a business, the attributable amount of goodwill is included in the determination

of the profit or loss on disposal.

3.4

Foreign currency

3.4.1

Foreign currency transactions and balances

Transactions in foreign currencies are translated to the respective functional currencies of

Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities

denominated in foreign currencies are translated into the functional currency at the closing rate

at the reporting date. Foreign currency differences are recognized in profit or loss and presented

within the foreign exchange gain/(loss) line item. Non-monetary items that are measured at fair

value in a foreign currency are translated using the exchange rates at the date when the fair

value was determined. Translation differences on assets and liabilities carried at fair value are

reported as part of the fair value gain or loss. For example, translation differences on non-

Meltwater N.V. – Annual consolidated and company only financial statements 2021

93

monetary assets and liabilities such as equities held at fair value through profit or loss are

recognized in profit or loss as part of the fair value gain or loss, and translation differences on

non-monetary assets such as equities classified as at fair value through other comprehensive

income are recognized in other comprehensive income.

3.4.2

Group companies

The results and financial position of foreign operations (none of which has the currency of a

hyperinflationary economy) that have a functional currency different from the presentation

currency are translated into the presentation currency as follows:

• Assets and liabilities of foreign operations are translated to US Dollar at closing rates at

the reporting date.

• The income and expenses of foreign operations are translated into US Dollar at the

average exchange rates.

• Foreign currency differences are recognized in other comprehensive income (“OCI’’)

and accumulated in the foreign currency translation reserve in equity. When a foreign

operation is disposed of in its entirety or partially, the cumulative amount in the foreign

currency translation reserve related to that foreign operation is reclassified to profit or

loss as part of the gain or loss on disposal.

3.5

Financial instruments

3.5.1

Recognition and derecognition

Financial assets and financial liabilities are recognized when the Group becomes a party to

the contractual provisions of the financial instrument. Financial instruments, except for trade

receivables, are recognized on settlement date. Financial assets are derecognized when the

contractual rights to the cash flows from the financial asset expire or when the financial asset

with substantially all the risks and rewards are transferred. A financial liability is derecognized

when it is extinguished, discharged, cancelled or expires.

3.5.2

Classification and initial measurement of financial assets

Except for the trade receivables that are measured at the transaction price, all financial assets

are initially measured at fair value adjusted for transaction costs where applicable. Financial

assets are classified as either:

- amortized cost (including cash and cash equivalents, deposits, trade and most of other

receivables); or

- fair value through profit or loss (“FVTPL’’) (including equity investments).

The classification is determined by considering both:

- the entity’s business model for managing the financial asset; and

- the contractual cash flow characteristics of the financial asset.

All income and expenses relating to financial assets that are recognized in profit or loss are

presented within finance costs and finance income. The Group recognizes an impairment gain

or loss in profit or loss for all financial instruments with a corresponding adjustment to their

carrying amount through a loss allowance account- which is also presented within Trade and

other receivables (note 9).

3.5.3

Subsequent measurement of financial assets

Financial assets at amortized cost

Debt instruments that meet the following conditions are measured subsequently at amortized

cost:

Meltwater N.V. – Annual consolidated and company only financial statements 2021

94

- the financial asset is held within a business model whose objective is to hold financial

assets in order to collect contractual cash flows; and

- the contractual terms of the financial asset give rise on specified dates to cash flows

that are solely payments of principal and interest on the principal amount outstanding.

After initial recognition, the assets are measured at amortized cost using the effective interest

method. Discounting is omitted where the effect of discounting is immaterial. The amortized

cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and

impairment are recognized in profit or loss.

Financial assets through other comprehensive income

Debt instruments that meet the following conditions are measured subsequently at fair value

through other comprehensive income (“FVTOCI’’):

- the financial asset is held within a business model whose objective is achieved by both

collecting contractual cash flows and selling the financial assets; and

- the contractual terms of the financial asset give rise on specified dates to cash flows

that are solely payments of principal and interest on the principal amount outstanding.

Financial assets through profit and loss

By default, all other financial assets are measured subsequently at fair value through profit or

loss (“FVTPL’’).

Assets in this category are measured at fair value with gains or losses, including any interest

and dividend income, recognized in profit or loss. The fair values of financial assets in this

category are determined by reference to active market transactions or using a valuation

technique where no active market exists.

3.5.4

Recoverability of financial assets

The Group uses the simplified approach in accounting for its financial assets (trade- and lease

receivables and deposits) and records the loss allowance as lifetime expected credit losses

(‘ECL’). The ECL are the expected shortfalls in contractual cash flows, considering the potential

for default at any point during the life of the financial instrument. The Group makes use of the

practical expedient by which they can use a provision matrix as the basis to determine the

expected loss for its trade accounts receivable. The expected credit loss is based on the historical

observed default rates per trade accounts receivable ageing category over the expected life of

the trade account receivables. Forward-looking adjustment is considered to have very limited

impact due to very short maturity of financial assets exposed to credit risk.

The Group recognizes, within general and admin expenses in the consolidated statement of

profit or loss and other comprehensive income, the amount of expected credit losses (or reversal)

that is required to adjust the loss allowance at the reporting date to the amount that is required

to be recognized. When a trade receivable is uncollectable (in severe financial difficulty and

there is no realistic prospect of recovery), it is written off against the allowance account.

3.5.5

Classification and measurement of financial liabilities

The Group’s financial liabilities include debt to shareholders, related parties and third parties

as well as accounts payable to suppliers and trade creditors and lease liabilities. Financial

liabilities are initially measured at fair value and are adjusted for transaction costs where

applicable. Subsequently, financial liabilities are measured at amortized cost using the effective

interest rate method. All interest-related charges are recognized within finance costs in the

consolidated statement of profit or loss and other comprehensive income.

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3.5.6

Offsetting

Financial assets and financial liabilities are offset with the net amount reported in the

consolidated statement of financial position if there is a currently enforceable legal right to

offset the recognized amounts and the Group intends to settle on a net basis, to realize the

assets and settle the liabilities simultaneously.

3.6

Intangible assets

3.6.1

Recognition and measurement

Goodwill

Refer to note 3.3

Research and development cost

Expenditure on research activities is recognized in the

statement of profit or loss and other comprehensive

income as incurred. These costs consist primarily of

research and development employee-related expenses,

third-party contractor fees and allocated overhead

associated with developing new services.

Development expenditure is capitalized only if the

expenditure can be measured reliably, the product or

process is technically and commercially feasible, future

economic benefits are probable, and the Group intends to

and has sufficient resources to complete development and

to use or sell the asset. Otherwise, it is recognized in profit

or loss as incurred. Development costs previously

recognized as an expense are not recognized as an asset

in a subsequent period. Subsequent to initial recognition,

development expenditure is measured at cost less

accumulated amortization and any accumulated

impairment losses. Amortization of the asset begins when

development is complete and the asset is available for use.

During the period of development, the asset is tested for

impairment annually.

Other intangible assets

Other intangible assets, including developed technology,

customer relationships, content supplier relationships,

tradenames and others, that are acquired by the Group

and have finite useful lives are measured at cost, being the

fair value at acquisition date, less accumulated

amortization and any accumulated impairment losses.

The cost of a separately acquired intangible asset

comprises:

(a) its purchase price, including import duties and

non-refundable purchase taxes, after deducting trade

discounts and rebates; and

(b) any directly attributable cost of preparing the asset

for its intended use.

Initial capitalized development cost is based on management’s judgement that technological

and economic feasibility is confirmed, usually when a product development project has

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reached a defined milestone according to an established project management model. In

determining the impairment considerations as well as the useful life, management makes

assumptions regarding the expected future cash generation of the project, discount rates to

be applied and the expected period of benefits.

3.6.2

Subsequent expenditure

Subsequent expenditure is capitalized only when it increases the future economic benefits

embodied in the specific asset to which it relates. All other expenditure is recognized in profit or

loss as incurred.

3.6.3

Amortization

Amortization is calculated to write off the cost of intangible assets less their estimated residual

values using the straight-line method over their estimated useful lives and is recognized in profit

or loss.

The estimated useful lives for current and comparative periods are as follows:

Assets

Years

Capitalized software

3 years

Other intangible assets

2 - 10 years

Amortization methods and useful lives are reviewed at each reporting date and adjusted if

appropriate.

3.7

Borrowing costs

General and specific borrowing costs directly attributable to the acquisition and construction

of qualifying assets, which are assets that necessarily take a substantial period of time to get

ready for their intended use or sale, are added to the cost of those assets, until such time as the

assets are substantially ready for their intended use or sale.

The rate used to capitalize interest was based on consideration of the following:

- The 2016 Note Payable accrued interest on a quarterly basis, which was payable on a

quarterly basis. The loan agreement provided for the Company to elect the interest

rate from alternatives that include Prime Rate plus a margin range of 7.75% to 8.50%

per annum for 2019 based on the senior leverage ratio and LIBOR plus a margin range

of 9.00% to 9.75% per annum for 2019 based on the senior leverage ratio.

- The 2019 Note Payable accrued interest on a quarterly basis, of which 4.00% was

payable either at the loan’s maturity or upon prepayment of the note and the

remainder was payable on a quarterly basis. The loan agreement provided for the

Company to elect the interest rate from alternatives that include Prime Rate plus a

margin range of 7.75% to 8.50% per annum in 2020 and LIBOR plus 9.50% per annum.

During the year ended 31 December 2021, no interest accrued relating to the 2019 Note

Payable. Please refer to note 1.2 Going Concern where the repayment of loan is

disclosed.

- The Company entered a multi-currency revolving credit facility (the “2020 Credit

Facility”) of $150.0 million. The maturity date of the 2020 Credit Facility is three years

from when the first utilization occurs with an option to extend an additional one to two

years. Interest accrues on amounts outstanding under the 2020 Credit Facility at

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LIBOR plus a margin range of 1.50% to 2.00% per annum. During the year ended 31

December 2021 the interest rates used to accrue and pay interest ranged from 0% to

1.65% (2020: 11.10% to 13.10%).

3.8

Property, plant and equipment

3.8.1

Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation

and any accumulated impairment losses. If significant parts of an item of property, plant and

equipment have different useful lives, then they are accounted for as separate items (major

components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognized in profit

or loss.

3.8.2

Subsequent expenditure

Subsequent expenditure is capitalized only if it is probable that the future economic benefits

associated with the expenditure will flow to the Group and the cost of the item can be reliably

measured.

3.8.3

Depreciation

Depreciation is calculated using the straight-line method over the estimated useful lives of

property, plant and equipment.

The estimated useful lives of property, plant and equipment for current and comparative periods

are as follows:

Assets

Years

Right-of-use assets

4 years

Computer equipment

3 years

Office equipment and furniture

3 – 5 years

Leasehold improvements are amortized over the lesser of their useful life or the term of the

applicable lease.

Leased assets (refer to note 3.10) are depreciated over the shorter of the asset useful life or the

lease term.

Depreciation methods, useful lives and residual values are reviewed at each reporting date

and adjusted if appropriate.

3.9

Impairment of assets

Goodwill is not subject to amortization and is tested annually for impairment, or more frequently

if events or changes in circumstances indicate that it might be impaired. Other non-financial

assets are tested for impairment whenever events or changes in circumstances indicate that the

carrying amount may not be recoverable. An impairment loss is recognized for the amount by

which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is

the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of

assessing impairment, assets are grouped at the lowest levels for which there are separately

identifiable cash inflows which are largely independent of the cash inflows from other assets or

groups of assets (cash-generating units). Where an impairment indicator has been identified on

an individual asset level, the impairment is assessed for that individual asset. Goodwill is

reviewed for possible impairment at the end of each reporting period. Non-financial assets other

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than goodwill that suffered an impairment are reviewed for possible reversal of the impairment

at the end of each reporting period.

3.10

Leases

3.10.1

As a lessee

The lease portfolio of the Group consists of corporate office spaces. The Group recognizes a

right-of-use asset and a lease liability at the commencement date. The right-of-use assets are

presented separately from property, plant and equipment in the financial statements but are

disclosed together with property, plant and equipment in note 4. The right-of-use asset is initially

measured at cost, which comprises the initial amount of the lease liability adjusted for any lease

payments made at or before the commencement date, less any lease incentives received

The right-of-use asset is subsequently depreciated using the straight-line method from the

commencement date to the earlier of the end of the useful life of the right-of-use asset or the

end of the lease term. The right-of-use asset is periodically reduced by impairment losses, if any,

and adjusted for certain remeasurements of the lease liability.

The lease liability is initially measured at the present value of the lease payments that are not

paid at the commencement date, discounted at the incremental borrowing rate (“IBR”), being

the rate at which a similar borrowing could be obtained from an independent financier under

comparable terms and conditions. The Group applies a single IBR to a portfolio of leases with

reasonably similar characteristics. The total lease payments include fixed payments, rent-free

periods as well as variable lease payments that depend on an index or rate as at the

commencement date. The Group determined the lease term of each lease as the non-cancellable

period of a lease, together with periods covered by an option to extend and terminate the lease

if the lessee is reasonably certain to exercise those options. If the Group cannot readily

determine the interest rate implicit in the lease, it uses its IBR to measure the present value of

future lease payments.

The Group has several lease contracts that include extension and termination options. The

Group applies judgement in evaluating whether it is reasonably certain whether or not to

exercise the option to renew or terminate the lease. That is, it considers all relevant factors that

create an economic incentive for it to exercise either the renewal or termination. After the

commencement date, the Group reassesses the lease term if there is a significant event or

change in circumstances that is within its control and affects its ability to exercise or not to

exercise the option to renew or to terminate (e.g. construction of significant leasehold

improvements).

The lease liability is remeasured when there is a change in future lease payments arising from a

change in an index or rate. When the lease liability is remeasured in this way, a corresponding

adjustment is made to the carrying amount of the right-of-use asset.

The Group accounts for lease modifications as a separate lease if the modification increases

the scope of the lease by adding the right to use one or more underlying assets; and the

consideration for the lease increases by an amount commensurate with the stand-alone price

for the increase in scope and any appropriate adjustments to that stand-alone price to reflect

the circumstances of the particular contract.

For modifications that are not accounted for as a separate lease, the Group remeasures the

lease liability by discounting the revised lease payments using a revised discount rate. The

remeasurement is recognized as an adjustment to the right-of-use asset.

The Group has elected to account for the lease and non-lease components as a single lease

component. The fixed payments therefore include fixed payments for lease and non-lease

components.

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The Group has also elected not to recognize right-of-use assets and lease liabilities for leases of

low-value assets. The lease payments associated with these leases are recognized as an expense

within the statement of profit and loss and other comprehensive income on a straight-line basis

over the lease term.

3.10.2

As a lessor

The Company enters into lease agreements as a lessor with respect to some of its right of use

assets. Leases for which the Company is a lessor are classified as finance or operating leases.

Whenever the terms of the lease transfer substantially all the risks and rewards of ownership to

the lessee, the contract is classified as a finance lease. All other leases are classified as

operating leases.

When the Company is an intermediate lessor, it accounts for the head lease and the sub-lease

as two separate contracts. The sub-lease is classified as a finance or operating lease by

reference to the right-of-use asset arising from the head lease.

Rental income from operating leases is recognized on a straight-line basis over the term of the

relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are

added to the carrying amount of the leased asset and recognized on a straight-line basis over

the lease term.

3.11

Prepayments

Prepayments are carried at cost. If there is an indication that the assets, goods or services

relating to a prepayment will not be received, the carrying value of the prepayment is written

down and the corresponding impairment loss is recognized in profit or loss within other

expenses.

3.12

Other receivables

These amounts generally arise from transactions outside the usual operating activities of the

Group. Interest may be charged at commercial rates where the terms of repayment exceed a

year. Collateral is not normally obtained.

3.13

Cash and cash equivalents

For the purpose of presentation in the statement of cash flows, cash and cash equivalents

includes cash at bank and on hand and deposits held at call with financial institutions.

3.14

Equity

3.14.1

Share capital

Share capital represents the nominal (par) value of issued shares.

3.14.2

Share premium

Share premium includes any premiums received on issue of share capital. Any transaction costs

associated with the issuing of shares are deducted from share premium, net of any related

income tax benefits. The share premium is also used to recognize the value of equity-settled

share-based payments provided to employees, including management personnel, as part of

their remuneration.

3.14.3

Foreign currency translation reserve

Foreign currency translation reserve comprises foreign currency translation differences arising

from the translation of financial statements of the Group’s foreign operations.

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3.14.4

Accumulated deficit

Accumulated deficit includes all current and prior period retained profits and losses.

3.15

Employee benefits obligations

3.15.1

Short-term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is

recognized for the amount expected to be paid if the Group has a present legal or constructive

obligation to pay this amount as a result of past service provided by the employee and the

obligation can be estimated reliably.

3.15.2

Other long-term employee benefits

Other long-term employee benefits relate to the long-service leave benefit. The Group’s net

obligation in respect of long-term employee benefits is the amount of future benefit that

employees have earned in return for their service in the current and prior periods. That benefit

is discounted to determine its present value. Remeasurements are recognized in profit or loss in

the period in which they arise.

The Group has liabilities for long-service leave benefit that are not expected to be settled wholly

within 12 months after the end of the period in which the employees render the related service.

These obligations are therefore measured as the present value of expected future payments to

be made in respect of services provided by employees up to the end of the reporting period,

using the projected unit credit method. Consideration is given to expected future wage and

salary levels, experience of employee departures and periods of service. Expected future

payments are discounted using market yields at the end of the reporting period of high-quality

corporate bonds with terms and currencies that match, as closely as possible, the estimated

future cash outflows. Remeasurements as a result of experience adjustments and changes in

actuarial assumptions are recognized in profit or loss.

The obligations are presented as current liabilities in the balance sheet if the entity does not

have an unconditional right to defer settlement for at least 12 months after the reporting period,

regardless of when the actual settlement is expected to occur.

3.15.3

Post-employment obligations

For defined contribution plans, the Group pays contributions to publicly or privately

administered pension insurance plans on a mandatory, contractual or voluntary basis. The

Group has no further payment or legal obligations once the contributions have been paid. The

contributions are recognized as employee benefit expense when they are due in the periods

during which services are rendered by employees. Prepaid contributions are recognized as an

asset to the extent that a cash refund or a reduction in the future payments is available.

3.15.4

Termination benefits

Termination benefits are payable when employment is terminated by the Group before the

normal retirement date, or when an employee accepts voluntary redundancy in exchange for

these benefits. The Group recognizes termination benefits at the earlier of the following dates:

(a) when the Group can no longer withdraw the offer of those benefits; and (b) when the entity

recognizes costs for a restructuring that is within the scope of IAS 37 and involves the payment

of terminations benefits. In the case of an offer made to encourage voluntary redundancy, the

termination benefits are measured based on the number of employees expected to accept the

offer. Benefits falling due more than 12 months after the end of the reporting period are

discounted to present value.

3.15.5

Share-based payments

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The cost of equity-settled share-based payments to employees and others providing similar

services is measured at the grant date, based on the fair value of the award, and is recognized

as an expense over the requisite service period which is the period over which all of the specified

vesting conditions are to be satisfied.

For certain restricted share units (“RSUs’’), a liquidity condition needs to be satisfied in addition

to the service condition. The liquidity event condition is satisfied on the earlier of (i) an

acquisition or change in control of the Company or (ii) one hundred and eighty days after the

effective date of the Company filing a registration statement on Form S-1 (or equivalent filing)

with the U.S. Securities and Exchange Commission for the initial public offering of its shares. No

compensation expense is recognized for restricted share units until the liquidity condition is

deemed probable. At the end of each period, the Group revises its estimates of the number of

options that are expected to vest based on the non-market vesting and service conditions. It

recognizes the impact of the revision to original estimates, if any, in profit or loss, with a

corresponding adjustment to equity. The liquidity condition aforementioned only applied until

the RSU’s were modified during 2021. Refer to note 16 for discussion of the accounting for this

modification.

The fair value excludes the effect of non-market-based vesting conditions. The fair value of

share-based awards to employees is estimated using the Black-Scholes option-pricing model.

The Company does not anticipate paying any cash dividends in the foreseeable future and

therefore uses an expected dividend yield of zero in the option pricing model. The impact of the

revision of the forfeitures, if any, is recognized in profit or loss such that the cumulative expense

reflects the revised estimate, with a corresponding adjustment to reserves.

3.15.6

Defined benefit plan

The liability or asset recognized in the balance sheet in respect of defined benefit pension plans

is the present value of the defined benefit obligation at the end of the reporting period less the

fair value of plan assets. The defined benefit obligation is calculated annually by independent

actuaries using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated

future cash outflows using interest rates of high-quality corporate bonds that are denominated

in the currency in which the benefits will be paid, and that have terms approximating to the

terms of the related obligation. In countries where there is no deep market in such bonds, the

market rates on government bonds are used.

The net interest cost is calculated by applying the discount rate to the net balance of the

defined benefit obligation and the fair value of plan assets. This cost is included in the finance

costs and finance income in the statement of profit or loss and other comprehensive income.

Remeasurement gains and losses arising from experience adjustments and changes in

actuarial assumptions are recognized in the period in which they occur, directly in other

comprehensive income. They are included in accumulated deficit in the statement of changes

in equity and in the balance sheet.

Changes in the present value of the defined benefit obligation resulting from plan

amendments or curtailments are recognized immediately in profit or loss as past service costs.

3.16

Contingent liabilities

Contingent liabilities are disclosed when the Group has:

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- a possible obligation that arises from past events and whose existence will be

confirmed only by the occurrence or non-occurrence of one or more uncertain future

events not wholly within the control of the entity; or

- a present obligation that arises from past events but is not recognized because

o it is not probable that an outflow of resources embodying economic benefits

will be required to settle the obligation; or

o the amount of the obligation cannot be measured with sufficient reliability.

Contingent liabilities are not disclosed if the possibility of any outflow in settlement is remote.

3.17

Contingent assets

Contingent assets are assessed continually to ensure that developments are appropriately

reflected in the financial statements. If it has become virtually certain that an inflow of economic

benefits will arise, the asset and the related income are recognized in the financial statements

of the period in which the change occurs. If an inflow of economic benefits has become

probable, an entity discloses the contingent asset.

3.18

Revenue from contracts with customers

The Company derives its revenue primarily from subscription fees for its cloud-based news and

social media monitoring services.

Revenue is recognized when a customer obtains control of promised services, consisting of

subscriptions of our software platform. The amount of revenue recognized reflects the

consideration that the Company expects to be entitled to receive in exchange for these services.

The Company applies the following five steps to recognize revenue:

1. Identify the contract with a customer.

2. Identify the performance obligations in the contract.

3. Determine the transaction price.

4. Allocate the transaction price to performance obligations in the contract.

5. Recognize revenue when or as the Company satisfies a performance obligation.

Revenue is generally recognized on a gross basis where the Company acts as a principal, as

the Company is primarily responsible for fulfilling the contract and has discretion in establishing

the price when selling to the customer. To the extent the Company does not meet the criteria for

recognizing revenue on a gross basis, the Company records the revenue on a net basis.

Certain of the Company’s contracts with its customers include potential adjustments such as

price concessions. The Company estimates the variable consideration related to these price

adjustments as part of the total transaction price and constrains the amount of revenue

recognized to the extent it is probable that a significant reversal will not occur. The Company

determines the amounts to be recognized based on the amount of potential refund or

concession, historical experience and other surrounding facts and circumstances. The

Company estimates the variable consideration at each reporting period, and recognizes

revenue when the uncertainty is resolved.

Subscription revenue

The Company derives its revenue primarily from subscription fees for its cloud-based news and

social media monitoring services. The Company hosts software applications over subscription

periods generally up to 12 months or may extend to longer periods. The Company provides

customers with access to training and support that help them use the cloud-based news and

social media monitoring services over the subscription periods. The subscription agreements are

noncancelable and do not contain provisions for refunds. Customers do not have any

contractual rights to take possession of the Company’s software applications. The services the

Company provides each day are substantially the same and have the same pattern of transfer

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to the customer, thus, meeting the definition of a series of distinct services that form a single

performance obligation.

The Company satisfies the subscription and related services evenly over the contract period as

customers simultaneously receive and consume the services provided. Revenue is recognized

rateably over the subscription period from the contract effective date which is also the date the

Company makes its services available to customers. Payment is typically due up-front in its

entirety or throughout the contract period, usually monthly. Fees for services are generally fixed,

however certain contracts include variable charges based on usage that occurs in a given

month. Those variable fees are recognized as revenue in the month the usage occurs and

typically are billed in the subsequent month.

The Company generally does not have any contracts where the period between the transfer of

the promised services to the customer and payment by the customer exceeds one year. As a

consequence, the Group does not adjust any of the transaction prices for the time value of

money.

Recorded revenue excludes any sales, use or other similar taxes that the Company is required

to collect from customers for remittance to governmental authorities.

Costs capitalized to obtain revenue contracts

The Company capitalizes incremental costs of obtaining a revenue contract. The capitalized

amounts consist primarily of sales commissions and fringe benefit costs associated with the

Company’s direct sales force. Costs capitalized related to new revenue contracts are amortized

on a straight-line basis over four years, which although longer than the typical initial contract

period, reflects the average period of benefit, including expected contract renewals.

Additionally, the Company amortizes capitalized costs for renewal over the renewal period.

In the year ended 31 December 2021, the Company capitalized $49.7 million of incremental

contract costs and recorded amortization of $36.8 million related to amounts capitalized in the

current and prior years. In the year ended 31 December 2020, the Company capitalized $33.8

million of incremental contract costs and recorded amortization of $32.9 million related to

amounts capitalized in the current and prior years.

Concentration of credit risk and significant Customers

Financial instruments that potentially subject the Company to concentrations of credit risk

consist primarily of cash and accounts receivable. The Company places its cash with major

financial institutions in countries where it and its subsidiaries are located. For banks located in

the United States, the Company has exposure to credit risk to the extent cash balances exceed

amounts covered by federal deposit insurance.

There were no customers whose balance represented 10% or more of the accounts receivable

balance as of 31 December 2021 and 2020, or whose revenue represented 10% or more of

revenue during the years ended 31 December 2021 and 2020.

Contract liabilities

Contract liabilities consist of billings or payments received in advance of recognition of revenue

from the Company’s services described above and is only recognized as revenue when the

revenue recognition criteria are met. The portion of contract liabilities that the Company will

recognize during the twelve-month period from the balance sheet date is recorded within current

liabilities and the remaining portion is recorded as non-current.

Cost of revenue

Cost of revenue consists of hosting costs, content royalties, data communications expenses,

employee-related expenses, allocated overhead costs based on headcount, software license

fees, costs associated with website development activities, depreciation expense associated

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with computer equipment, and amortization expense associated with capitalized software

related to the Company’s cloud-based customer services and acquired developed technologies.

The accounting policies for the Group’s revenue from contracts with customers are explained

further in Note 22 (Revenue from contracts with customers) and note 11 (Contract costs).

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3.19

Operating result

Operating profit/loss is the result generated from the continuing principal revenue-producing

activities of the Group as well as other income and expenses related to operating activities.

Operating profit/loss excludes net finance costs, foreign exchange gain or loss and income

taxes.

3.20

Finance income and finance costs

The Group’s finance income and finance costs include:

• interest income;

• interest expense;

• net interest expense on defined benefit obligation;

• Gains/losses on loan extinguishment; and

• Foreign exchange gains/losses

Interest income or expense is recognized using the effective interest method.

The difference between the reacquisition price of debt and its net carrying amount is

recognized in the period of extinguishment as a gain/loss on loan extinguishment.

3.21

Income tax

Income tax expense comprises current and deferred tax. It is recognized in profit or loss except

to the extent that it relates to items recognized directly in equity or in other comprehensive

income (OCI).

3.21.1

Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for

the year and any adjustment to tax payable or receivable in respect of previous years. The

amount of current tax payable or receivable is the best estimate of the tax amount expected to

be paid or received that reflects uncertainty related to income taxes, if any. It is measured using

tax rates enacted or substantively enacted at the reporting date. Current tax assets and

liabilities are offset only if certain criteria are met.

3.21.2

Deferred tax

Deferred tax is recognized in respect of temporary differences between the carrying amounts

of assets and liabilities for financial reporting purposes and the amounts used for taxation

purposes. Deferred tax assets are recognized for unused tax losses, unused tax credits and

deductible temporary differences to the extent that it is probable that future taxable profits will

be available against which they can be used. Deferred tax is measured at the tax rates that are

expected to be applied to temporary differences when they reverse, using tax rates enacted or

substantively enacted at the reporting date. Deferred tax assets and liabilities are offset only if

certain criteria are met.

Deferred tax liabilities are not recognized if they arise from the initial recognition of goodwill.

Deferred income tax is also not accounted for if it arises from initial recognition of an asset or

liability in a transaction other than a business combination that, at the time of the transaction,

affects neither accounting nor taxable profit or loss.

Deferred tax liabilities and assets are not recognized for temporary differences between the

carrying amount and tax bases of investments in foreign operations where the Company is able

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to control the timing of the reversal of the temporary differences and it is probable that the

differences will not reverse in the foreseeable future.

The Group elected to apply the initial recognition exemption (IRE) on initial recognition as well

as for subsequent measurement, therefore the right-of-use asset and the lease liability are

considered separately for deferred tax purposes.

3.21.3

Uncertainty over income taxes

The Group’s current tax provision relates to management’s assessment of the amount of tax

payable on open tax positions where the liabilities remain to be agreed with the Tax Authorities.

Uncertain tax items relate principally to the interpretation of tax legislation regarding

arrangements entered into by the Group. Due to the uncertainty associated with tax items, there

is a possibility that, on conclusion of open tax matters at a future date, the final outcome may

differ.

The Group measures its tax balances either based on the most likely amount or the expected

value, depending on which method provides a better prediction of the resolution of the

uncertainty. Unrecognized deferred tax assets are reassessed at each reporting date and

recognized to the extent that it has become probable that future taxable profits will be available

against which they can be used.

3.22

Fair value measurement

‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an

orderly transaction between market participants at the measurement date in the principal or, in

its absence, the most advantageous market to which the Group has access at that date. The fair

value of a liability reflects its non-performance risk.

When one is available, the Group measures the fair value of an instrument using the quoted

price in an active market for that instrument. A market is regarded as ‘active’ if transactions for

the asset or liability take place with sufficient frequency and volume to provide pricing

information on an ongoing basis.

If there is no quoted price in an active market, then the Group uses valuation techniques that

maximize the use of relevant observable inputs and minimize the use of unobservable inputs. The

chosen valuation technique incorporates all of the factors that market participants would take

into account in pricing a transaction.

3.23

Government grants

Grants from the government are recognized at fair value where there is a reasonable

assurance that the grant will be received, and the Group will comply with all attached

conditions.

Government grants relating to costs are deferred and recognized in profit or loss over the

period necessary to match them with the costs that they are intended to compensate.

Government grants relating to property, plant and equipment are included as a deduction in

arriving at the asset’s carrying amount and are credited to the profit or loss on a straight-line

basis over the expected lives of the related assets.

3.24

Earnings per share

The Company presents basic and diluted earnings per share (EPS) data for its shares. Basic EPS

is calculated by dividing the profit attributable to owners of the Company (excluding any costs

of servicing equity other than ordinary shares) by the weighted average number of ordinary

Meltwater N.V. – Annual consolidated and company only financial statements 2021

107

shares outstanding during the financial year, adjusted for bonus elements in ordinary shares

issued during the year and excluding treasury shares.

Diluted EPS adjusts the figures used in the determination of basic EPS to take into account the

after-income tax effect of interest and other financing costs associated with dilutive potential

ordinary shares, and the weighted average number of additional ordinary shares that would

have been outstanding assuming the conversion of all dilutive potential ordinary shares.

4.

Property, plant and equipment and right-of-use assets

Property, plant and equipment

Leasehold

improvements

$’000

Computer

Equipment

$’000

Office

equipment

$’000

Total

$’000

As at 1 January 2020

Acquisition costs

4 853

6 686

5 045

16 584

Accumulated depreciation

(3 600)

(4 907)

(3 613)

(12 120)

Net book amount

1 253

1 779

1 432

4 464

Movements for the year ended 31

December 2020

Additions

1 734

292

263

2 289

Depreciation

(1 171)

(989)

(609)

(2 769)

Disposals

(3 505)

(1 457)

(2 069)

(7 031)

Accumulated depreciation on

disposals

3 069

1 405

1 804

6 278

Foreign exchange differences

42

46

55

143

As at 31 December 2020

Acquisition costs

3 155

5 685

3 394

12 234

Accumulated depreciation

(1 733)

(4 609)

(2 519)

(8 861)

Net book amount

1 422

1 076

875

3 373

Movements for the year ended 31

December 2021

Additions

465

1 497

104

2 066

Additions through acquisitions

-

32

30

62

Depreciation

(538)

(858)

(311)

(1 707)

Disposals

(141)

(260)

(294)

(695)

Accumulated depreciation on

disposals

141

260

294

695

Foreign exchange differences

(74)

(12)

(52)

(138)

As at 31 December 2021

Acquisition costs

3 351

7 029

3 737

14 117

Accumulated depreciation

(2 076)

(5 294)

(3 091)

(10 461)

Net book amount

1 275

1 735

646

3 656

Meltwater N.V. – Annual consolidated and company only financial statements 2021

108

Right-of-use assets

Buildings

$’000

As at 1 January 2020

22 748

Net book amount

Movements for the year ended 31 December 2020

Additions

19 401

Depreciation

(11 196)

Modifications

(1 130)

Foreign exchange differences

136

As at 31 December 2020

Net book amount

29 959

Movements for the year ended 31 December 2021

Additions

6 048

Depreciation

(11 149)

Modifications

1 307

Foreign exchange differences

(550)

As at 31 December 2021

Net book amount

25 615

Meltwater N.V. – Annual consolidated and company only financial statements 2021

109

5.

Intangible assets (including goodwill)

Goodwill

$’000

Capitalized

software

$’000

Other intangibles

$’000

Total

$’000

As at 1 January

2020

15 526

54 915

49 231

119 672

Acquisition cost

-

(22 786)

(29 493)

(52 279)

Accumulated

amortization and

impairments

15 526

32 129

19 738

67 393

Net book amount

Movements for the

year ended 31

December 2020

Additions

-

12 000

-

12 000

Amortization

-

(10 323)

(10 600)

(20 923)

Impairments

-

(1 100)

-

(1 100)

Foreign exchange

differences

759

334

291

1 384

As at 31 December

2020

Acquisition cost

16 285

61 290

50 839

128 414

Accumulated

amortization and

impairments

-

(28 250)

(41 410)

(69 660)

Net book amount

16 285

33 040

9 429

58 754

Meltwater N.V. – Annual consolidated and company only financial statements 2021

110

Goodwill consists of the acquisitions disclosed under note 36. Impairment considerations for

goodwill is disclosed under Note 6.

Included in the other intangible assets are the following items:

Cost at 31

December 2021

$’000

Accumulated

amortization

at 31 December

2021

$’000

Net book value

31 December 2021

$’000

Customer relationships

23 796

(14 946)

8 850

Developed technologies

44 375

(25 704)

18 671

Non-compete agreements

30

(30)

-

Trademarks

3 991

(2 297)

1 694

Content supplier relations

8 945

(8 905)

40

Total

81 137

(51 882)

29 255

Remaining useful life of other intangibles:

Remaining useful life

Customer relationships

0.2 – 8.4 years

Developed technologies

0.2 – 9.5 years

Non-compete agreements

0 years

Trademarks

0.2 – 9.5 years

Content supplier relations

0.1 years

The Company capitalized $12.2 million and $12.0 million of development costs related to

software during the years ended 31 December 2021 and 2020, respectively. Of the amount

capitalized, $0.2 million and $1.4 million was related to interest in 2021 and 2020, respectively.

Additionally, during the years ended 31 December 2021 and 2020, the Company recognized

Movements for the

year ended 31

December 2021

Additions

-

12 278

-

12 278

Additions through

acquisitions

64 556

-

30 855

95 411

Disposals

-

(5 726)

(802)

(6 528)

Accumulated

amortization on

disposals

-

5 726

802

6 528

Amortization

-

(11 075)

(11 274)

(22 349)

Impairments

-

(2 729)

-

(2 729)

Foreign exchange

differences

(414)

(136)

245

(305)

As at 31 December

2021

Acquisition cost

80 427

67 706

81 137

229 270

Accumulated

amortization and

impairments

-

(36 328)

(51 882)

(88 210)

Net book amount

80 427

31 378

29 255

141 060

Meltwater N.V. – Annual consolidated and company only financial statements 2021

111

impairment losses on capitalized software amounting to $2.7 million and $1.1 million related to

abandoned projects.

Impairment on intangible assets

The Company provided a vendor notice of termination of their contract due to the COVID-19

pandemic per the terms of its license agreement. As of October 2021, the vendor noted $1.8

million in outstanding invoices. As the Company has not used the services, the Company's

position is it is not required to pay the outstanding invoices or remaining fees due under the

contract from the date of notice of termination. In October 2021, the Company and the vendor

settled the dispute by the Company agreeing to pay $0.7 million to the vendor and the vendor

will waive the remaining outstanding balance of $1.1 million and terminate the contract. In

relation to the vendor services, the Company capitalized $2.5 million of development costs. As

the contract is terminated, the Company will not be able to utilize the capitalized software,

and as such, the Company recognized an impairment of the capitalized development costs of

$2.5 million related to the abandoned project in October 2021.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

112

6.

Goodwill

For the purpose of impairment testing, goodwill acquired in a business combination is, from the

acquisition date, assigned to the Group’s cash-generating unit (CGU). Goodwill is tested for

impairment, annually or more frequently if there are indications that goodwill might be

impaired.

Goodwill is allocated to the cash-generating unit as indicated below:

Media

intelligence

$’000

Total

$’000

Carrying value 31 December 2021

80 427

Carrying value 31 December 2020

16 285

Meltwater consists of one CGU. The CGU is tested for impairment by comparing the carrying

amount of the CGU to its recoverable amount. Recoverable amount is based on value in use and

is determined using a discounted cash flow model with a five-year forecast period that is

approved by management.

The key assumptions used by management in setting the financial budgets for the five-year

period were as follows:

Note: The 2020 and 2021 forecasted values are based on a five-year average. The 2020 forecast

uses 2021-2025 forecasted figures and the 2021 forecast uses 2022-2026 forecasted figures.

Impairment analysis as per 31 December 2021:

2021

Actual

2022 Forecast (Average

2022-2026)

Sales growth rate (%)

11.63%

19.04%

Gross margin (%)

70.19%

78.62%

Long-term growth rate (%)

-

1.9

Pre-tax discount rate (%)

-

14.5

Impairment analysis as per 31 December 2020:

2020

Actual

2021 Forecast (Average

2021-2025)

Sales growth rate (%)

4%

11.5%

Gross margin (%)

70.68%

77.44%

Long-term growth rate (%)

-

1.7

Pre-tax discount rate (%)

-

13.4

Sales 31 December

Revenues mainly consist of recurring revenue due to the subscription-based SaaS model which

the Company has in place.

Sales are projected to grow between 16% and 20.4% (2020: 8.4% and 19.2%) in the five

forecasted years due to the expectations that acquisition will further materialize in the forecast

period. The forecast was extended in 2020 by two years in order to linearly decrease the revenue

growth rate in the third year of each forecast to 1.70% in the terminal year.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

113

Budgeted gross margin

Based on past performance and management’s expectations for the future.

Other operating costs

Operational expenses mainly relate to general and administrative expenses, sales and

marketing expenses and research and development expenses. It is expected to increase from

$336 million in 2022 to $572 million in 2026 (2020: from $261 million in 2021 to $302 million in

2023).

Annual capital expenditure

Capital expenditures relate to maintenance CAPEX of fixed assets and capitalized software.

Capex and amortization as a percentage of revenues are forecasted to be stable after the third

year, and depreciation is assumed to converge to Capex in the terminal period.

Long-term growth rate

This is the growth rate used to extrapolate cash flows beyond the budget period. It is in line with

the 30-year US risk-free rate.

Pre-tax discount rate

The discount rate is derived from its weighted average cost of capital (WACC). The WACC

considers both debt and equity. The cost of equity is derived from the expected return on

investment by the Group’s investors. The cost of debt reflects the (pre-tax) borrowing costs at

current market rates as if the Company were to be refinanced at Valuation Date. Segment-

specific risk is incorporated by applying individual beta factors. Beta is driven by the sensitivity

of a firm’s earnings to market conditions, its operational leverage and its financial leverage.

For the impairment valuation analysis, a post-tax discount rate of 12% (2021) and 10.6% (2020)

was calculated. For disclosure purposes a pre-tax WACC of 14.5% (2021) and 13.4% (2020) is

applied.

(ii) Recoverable amount and impairment estimate

It was concluded that the recoverable amount of approximately $1.31 million (2020: $826 million)

exceeded the CGU carrying amount of approximately -$40 million (2020: -$121 million). As a

result of this analysis no impairment loss was recognized in both 2021 and 2020. The recoverable

amount disclosed is based on the mid-point range.

(iii) Impact of possible changes in key assumptions:

The Group has conducted an analysis of the sensitivity of the impairment test to changes in the

key assumptions used to determine the recoverable amount for the CGU. Specifically, the

WACC and terminal growth rate:

2021 financial year

If the post-tax WACC were to decrease to 9.60% or increase to up 14.40% the estimated

enterprise value ranges from $1.716 million to $1.053 million.

If the terminal growth rate would decrease to 0.90% or increase up to 2.90% the estimated

enterprise value ranges from $1.194 million to $1.444 million.

2020 financial year

Meltwater N.V. – Annual consolidated and company only financial statements 2021

114

If the post-tax WACC were to decrease to 8.40% or increase to up 12.70% the estimated

enterprise value ranges from $671 million to $1.077 million.

If the terminal growth rate would decrease to 0.70% or increase up to 2.70% the estimated

enterprise value ranges from $736 million to $939 million.

The directors and management have considered and assessed reasonably possible changes for

other key assumptions and have not identified any instances that could cause the carrying

amount of the CGU to exceed its recoverable amount.

7.

Leases

Right-of-use assets

The carrying amount of right-of-use assets related to leased buildings are included in property,

plant and equipment (Note 4).

Lease liabilities

The IBR is determined as the sum of a reference rate, credit risk premium and country risk

premium. The calculation of IBR considers the currency of the lease contract, the lease term,

type of leased assets, the region of the lessee and the credit rating of the lessee. A single IBR is

applied to a portfolio of leases, which are similar in nature and in lease term within a region. The

weighted average IBR applied to lease liabilities was 12.00% (2020: 13.00%).

The carrying amount of lease liabilities and the related movements during the period are as

follows:

2021

$’000

2020

$’000

As at 1 January

33 512

25 792

Additions

6 121

19 548

Modifications

1 373

(909)

Interest

4 088

3 608

Payments of lease invoices

(14 515)

(14 894)

Exchange rate differences

(682)

367

As at 31 December

29 897

33 512

Non-current

19 969

23 254

Current

9 928

10 258

The following table sets out a maturity analysis of lease payments, showing the undiscounted

lease payments to be paid after the reporting date:

31

December

2021

$’000

31

December

2020

$’000

Less than 1 year

12 501

13 999

1 to 2 years

10 054

10 879

2 to 3 years

7 513

8 757

3 to 4 years

4 403

6 639

4 to 5 years

848

3 968

More than 5 years

75

765

Meltwater N.V. – Annual consolidated and company only financial statements 2021

115

Total undiscounted lease liability

35 394

45 007

Unpaid finance expense

(5 497)

(11 495)

Total lease liability

29 897

33 512

Amounts recognized in the statement of profit and loss:

2021

$’000

2020

$’000

Depreciation on right-of-use asset

11 149

11 196

Interest expense (included in finance cost in note 25)

4 088

3 805

Expense related to short-term leases

1 384

172

Variable lease payments

1 237

1 939

Income from subleasing right-of-use asset

433

222

The total cash outflows recognized in the statement of cash flows is as follows:

2021

$’000

2020

$’000

Payments of lease invoices (principal portion)

10 437

10 648

Interest on lease liabilities

4 078

3 523

Expenses related to short-term leases

1 384

172

Variable lease payments

1 237

1 939

8.

Financial assets at fair value through profit and loss and amortized cost

The Group holds the following financial assets:

Financial assets at

amortized cost

$’000

Financial assets

measured at fair value

through profit and loss

$’000

Total

$’000

As at 1 January 2020

5 154

2 535

7 689

Additions

113

-

113

Other (exchange rate

effects and other)

-

1

Disposals

-

(500)

As at 31 December

2020

5 267

2 036

7 303

Additions

1 348

-

1 348

Additions through

acquisitions

2 861

-

2 861

Other (exchange rate

effects and other)

1 730

(658)

1 072

Disposal

(315)

(86)

(401)

As at 31 December 2021

10 891

1 292

12 183

Financial assets at amortized cost

The financial assets at amortized cost include deposits and restricted cash held in as collateral

in the event of default of our operating lease agreements. As of each of 31 December 2021 and

2020, restricted cash comprise $2.3 million and $2.4 million respectively.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

116

Financial assets at fair value through profit and loss

The Financial assets at fair value through profit and loss are purchased equity investments in

privately held technology companies and limited partnerships, in total $1.9 million (2020: $2.0

million). For these investments, the Company does not have the ability to exercise significant

influence over the investees. Furthermore, the fair value of these investees has not materially

changed year on year.

9.

Trade receivables

31

December

2021

$’000

31

December

2020

$’000

Trade receivables

88 090

75 682

Receivables from related parties

62

67

88 152

75 749

Trade receivables are amounts due from customers for services performed in the ordinary

course of business. They are classified as current and are expected to be collected within one

year. The Company’s allowance for expected credit losses was not material for the years ended

31 December 2020 and 2021.

10.

Other current assets

31

December

2021

$’000

31

December

2020

$’000

Prepayments

9 763

9 918

Lease deposits

31

1 058

VAT receivable

10 056

2 000

Short-term deposits

1 249

1 778

Other receivables

2 755

1 074

23 854

15

828

11.

Contract costs

31 December 2021

$’000

31 December 2020

$’000

As at 1 January

46 450

44 562

Movements

Investment in contract costs

49 754

33 815

Amortization

(36 757)

(32 856)

Other (foreign exchange rate effects)

(1 266)

929

As at 31 December

58 181

46 450

Non-current

25 690

20 980

Current

32 491

25 470

58 181

46 450

Meltwater N.V. – Annual consolidated and company only financial statements 2021

117

The Company capitalized incremental costs of obtaining a revenue contract. The capitalized

amounts consist primarily of sales commissions and fringe benefit costs associated with the

Company’s direct sales force. Costs capitalized related to new revenue contracts are

amortized on a straight-line basis over four years, which although longer than the typical

initial contract period, reflects the average period of benefit, including expected contract

renewals. Additionally, the Company amortizes capitalized costs for renewal over the renewal

period.

12.

Cash and cash equivalents

13.

Share capital

The Company’s Articles of Association, as amended, authorized the Company to issue an

unlimited number of shares of Series A common shares with a par value of $0.0001 per share

and zero preference shares with no par value. Additionally, the shares were converted from

$0.0001 per share to €0.01 per share resulting in an increase of the paid share capital to €3.0

million, the increase being funded from share premium.

The issued shares of Meltwater N.V. were as follows:

Total ordinary shares

Total Shares

Total amount

$’000

Opening balance 1 January 2020

237 356 001

24

Issuance of Series A common shares

54 430 699

5

31 December 2020

291 786 700

29

Issuance of Series A common shares

7 659 351

6

Release of restricted share units

4 737 740

-

Change in par value of share capital

-

3 404

Repurchase of shares

(1 625 236)

(18)

31 December 2021

302 558 555

3 421

The share premium of Meltwater N.V. was as follows:

2021

$’000

2020

$’000

As at 1 January

351 657

105 179

Premium arising on issue of shares

24 415

239 028

Premium decrease due to repurchase of shares

(14 620)

-

Change in par value

(3 404)

-

Share-based compensation expense

60 425

5 769

Share-based compensation tax

(1 218)

1 681

As at 31 December

417 255

351 657

31

December

2021

$’000

31

December

2020

$’000

Cash at bank

44 387

99 927

Meltwater N.V. – Annual consolidated and company only financial statements 2021

118

The total amount of transaction costs paid by the Company relating to the issue of shares and

recorded as a deduction from equity in the 2021 financial year is $35 thousand relating to shares

issued in 2020 (2020: $22.4 million).

On 2 December 2020, the Company effected a one hundred-for-one share split to shareholders

of record as of the same day. All share, par value, options, restricted share unit (“RSU”) and per

share information has been retroactively adjusted to reflect the share split.

Share repurchases

In December 2020 the Company’s Board of Directors approved a share repurchase program

authorizing the Company to repurchase 10% of shares, depository receipts, vested options and

vested RSUs (“Eligible Securities”) from current employees at a repurchase price of $4.96 per

share subject to a reduction for transaction expenses and exercise prices. The January 2021

amendment subsequently modified the valuation to be the greater of $4.96 or the average

closing price on the Euronext Growth Oslo over the period from 11 January 2021 through 15

January 2021. The average closing price for that time period was $6.81. The share repurchase

program commenced on 24 December 2020 and completed on 27 January 2021. The Company

repurchased 1 902 680 in Eligible Securities for an aggregate amount of $11.4 million. All share

repurchases were made using cash resources. In February 2021 the Company’s Board of

Directors approved the repurchase of 1 486 639 options from certain Executives and Officers of

the Company with a repurchase price of $6.81 less the option exercise price for an aggregate

amount of $8.9 million. All option repurchases were made using cash resources. The repurchases

were made above fair value. The amount of compensation expense recognized as a result of

repurchase above fair value is $13.4 million.

Employee buyback program

On 1 December 2021 the Company announced a share buyback program of up to $50 million.

The share buyback program comprised an initial offer to eligible Meltwater employees, to be

followed by general market repurchases. The general meeting authorized the Board of Directors

to repurchase Company shares on 3 December 2021, reconfirming the authorization granted by

the general meeting on 30 June 2021.

Additionally, The Company facilitated an opportunity for employee holders to sell up to 25% of

their total holdings through an employee offer. The price per share that was paid in the offer

was equal to the volume weighted average trading price in a five-trading day period starting

ten trading days after launch. In December 2021, management repurchased $7.4 million of

shares tendered by employees, however the amount was not paid to employees until January

2022 due to typical settlement period timing differences.

Additionally, under the program, Meltwater repurchased shares in the open market, in line with

applicable restrictions, relevant guidelines and main safe harbor principles on price and volume

limitations. Repurchases took place as from January 2022 and the duration of the program is

until 31 May 2022 or such earlier time as the Board of Directors resolves to terminate the

program.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

119

14.

Other reserves

The other reserves comprise of the following:

Foreign currency

translation reserve

$’000

Remeasurement on

employee benefit

obligation reserve

$’000

Total

$’000

Balance as of 1 January 2020

(1 807)

(104)

(1 911)

Foreign currency translation

adjustments

1 751

-

1 751

Remeasurement on employee benefit

obligation

-

60

Total comprehensive income/(loss)

1 751

60

1 811

Balance as of 31 December 2020

(56)

(44)

(100)

Balance as of 1 January 2021

(56)

(44)

(100)

Foreign currency translation

adjustments

(3 467)

-

(3 467)

Remeasurement on employee benefit

obligation

-

19

Total comprehensive income/(loss)

(3 467)

19

(3 448)

Balance as of 31 December 2021

(3 523)

(25)

(3 548)

15.

Employee benefit obligations

Employee benefit obligations as per statement of financial position comprise of:

31 December 2021

Current

$’000

Non-current

$’000

Total

$’000

Long service leave obligation (i)

148

123

271

Defined pension benefits (ii)

-

133

Total employee benefit obligations

148

256

404

31 December 2020

Current

$’000

Non-current

$’000

Total

$’000

Long service leave obligation (i)

127

114

241

Defined pension benefits (ii)

-

220

Total employee benefit obligations

127

334

461

i)

Long service leave obligation

Meltwater Australia employees earn additional leave days after a certain number of service

years under this plan, which is comparable to a jubilee plan which utilizes leave days instead

of jubilee benefits (e.g. monthly salary).

Meltwater N.V. – Annual consolidated and company only financial statements 2021

120

The amounts recognized in the balance sheet and the movements in the long service leave

obligation over the year are as follows:

Present value of obligation

$’000

1 January 2020

(216)

Current service cost

(40)

Interest (expense)/income

(4)

Gains/(losses) on other long-term benefits

8

Total amount recognized in profit or loss

(36)

Exchange differences

11

Total other comprehensive income/(losses

11

31 December 2020

(241)

Present value of obligation

$’000

1 January 2021

(241)

Current service cost

(42)

Interest (expense)/income

(3)

Gains/(losses) on other long-term benefits

(1)

Total amount recognized in profit or loss

(46)

Exchange differences

16

Total other comprehensive income/(losses

16

31 December 2021

(271)

The net liability disclosed above is unfunded.

The significant actuarial assumptions were as follows:

31 December 2021

31 December 2020

Discount rate

2.49%

1.46%

Inflation rate

2.00%

Annual salary increase (including inflation)

10.00%

Leave taken in service

3.00%

Superannuation and on-cost assumption

The entity has advised the amount of on-costs to apply. These include workers’ compensation,

payroll tax and superannuation as well as annual leave and LSL that accrues on leave taken in

service. An allowance has been made for an increase in the minimum Superannuation

Guarantee rate which is progressively increasing from 10.00% currently to 12.00% by 1 July

2025.

Payroll tax, workers compensation and the accrual of additional long service leave are state-

based assumptions.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

121

Note that only workers compensation and payroll tax are payable on benefits paid on

termination. All on-costs apply to payments for leave taken in service.

The following table summarises the on-cost assumptions adopted:

Item

Assumption

Superannuation on-cost

10.00% - 12.00%

Workers’ compensation

0.25% to 0.59% (varies by state)

Payroll taxes*

4.85% to 5.45% (varies by state)

Annual leave (working days p.a.)

20

Long service leave (working days p.a.)

4.33 – 6.5

*NSW (New South Wales, Australia) payroll taxes are temporarily reduced from 5.45% to

4.85% (1 July 2020 to 30 June 2022)

Exit rate assumption

The exit rate assumptions are shown below for various years of service. In addition, we have

assumed that all employees retire at age 65 if they have not exited earlier.

These assumptions were set after considering the actual exit experience over the 3 years ended

31 December 2021, and applying smoothing given the small numbers of employees in Meltwater

Australia and hence some volatility in exit experience. The actual experience over the year ended

31 December 2021 showed continued high employee turnover rates, and therefore the Base

Assumptions remain appropriate. As relatively high rates of employee turnover have been

observed, we have also developed an alternative set of exit rate assumptions (lower turnover

rates) for sensitivity purposes. We have retained the same assumed rates for both of these sets

of assumptions as those adopted for the 31 December 2020 valuation.

Given that Victorian employees are entitled to receive long service leave payments upon

termination at 7 years’ service or more, whereas NSW and Queensland employees are only

entitled to long service leave payments upon termination from 10 years’ service onwards, we

have set a different assumption for expected exit experience based on State (as employees are

less likely to leave service as they approach the minimum service for entitlement).

Experience analysis

Actual exit rate p. a

Years of service

2021

2020

Average

0-1 year

45.5%

34.3%

40.7%

1-2 years

26.1%

26.3%

29%

2-3 years

57.1%

37.5%

37.1%

3-4 years

40%

50.0%

41.1%

4-5 years

40%

33.3%

35.6%

5+ years

28.3%

33.3%

22.2%

The average in the table above is a three years average, including 2019. Due to the fact that

2019 is not disclosed as a comparative it is not included in the table above but is included in the

average.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

122

Exit rate assumptions

Base assumptions

Sensitivity assumptions

Years of service

Probability of

termination

(Victoria)

Probability of

termination (other

states)

Probability of

termination

(Victoria)

Probability of

termination (other

states)

0-1 year

40%

35%

1-2 years

30%

25%

2-3 years

30%

25%

3-4 years

30%

25%

4-5 years

30%

25%

5-6 years

15%

30%

8%

25%

6-7 years

15%

30%

8%

15%

7-8 years

30%

15%

8-9 years

30%

15%

0%

9-10 years

30%

15%

0%

Greater than 10

years

30%

15%

The sensitivity of the long service leave obligation to changes in the weighted principal

assumptions is:

Liability value

31 December 2021

Impact

Percentage

Base cost

271

Sensitivities

Discount rate + 25 bps

268

(3)

-1%

Discount rate - 25 bps

274

3

1%

Salary increase +50 bps

277

6

2%

Salary increase - 50 bps

266

(6)

2%

Lower exit rate

assumptions

430

159

58%

Liability value

31 December 2020

Impact

Percentage

Base cost

242

Sensitivities

Discount rate + 25 bps

239

(3)

-1%

Discount rate - 25 bps

245

3

1%

Salary increase +50 bps

248

6

2%

Salary increase - 50 bps

237

(6)

-3%

Lower exit rate

assumptions

421

179

43%

ii)

Defined benefit pension plan

Meltwater Switzerland employees are entitled to a pension plan valid from 01 December 2010

including old-age pension, spouse and orphan pension, disability pension and death benefit. It

is a funded pension plan and compulsory for employees. The pension plan is financed by both

employees and employers via a pension fund (

Pensionskasse

). The old-age pension benefit is

calculated by multiplying the contribution with a conversion rate (according to pension

scheme plans). Spouse pension benefit is 60% of the old-age benefit or 20% for orphan.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

123

Disability pension benefit amounts to 6.80% of the projected regulatory retirement assets

without interest. In addition, the child of the disabled employee will also receive 20% of the

employee’s disability pension benefit. In case of death of an employee, spouse or orphan will

receive 60% or 20% of disability pension benefit.

The insured salary multiplied by an age-depending percentage defines the employee’s

contribution. The risk premium is 0.80% of the employee’s annual salary.

The plan’s entry age is 17. The earliest retirement age is 58. The normal retirement age is 65 for

men and 64 for women.

The amounts recognized in the balance sheet and the movements in the net defined benefit

obligation over the year are as follows:

Present value of

obligation

$’000

Fair value of plan

assets

$’000

Total

$’000

1 January 2020

(764)

544

(220)

Current service cost

(85)

-

(85)

Interest (expense)/income

(2)

10

8

Total amount recognized in profit or

loss

(87)

10

(77)

Return on plan assets, excluding

amounts included in interest income

-

50

Loss from change in financial

assumptions

(29)

-

(29)

Experience losses

39

-

39

Change in asset ceiling, excluding

amounts included in interest expense

-

Total amount recognized in other

comprehensive income

10

50

60

Exchange differences

(80)

63

(17)

Contributions:

Employer

-

34

Plan participants

(34)

34

-

Benefit payments

31 December 2020

(955)

735

(220)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

124

Present value of

obligation

$’000

Fair value of plan

assets

$’000

Total

$’000

1 January 2021

(955)

735

(220)

Current service cost

(88)

Interest (expense)/income

(2)

7

5

Total amount recognized in profit or

loss

(90)

7

(83)

Return on plan assets, excluding

amounts included in interest income

-

5

Loss from change in financial

assumptions

51

-

51

Loss from change in demographic

assumptions

38

-

38

Experience losses

35

Change in asset ceiling, excluding

amounts included in interest expense

-

Total amount recognized in other

comprehensive income

124

5

129

Exchange differences

34

(26)

8

Contributions:

Employer

-

33

Plan participants

(33)

33

-

Benefit payments

76

(76)

-

31 December 2021

(844)

711

(133)

The total net liability relates to funded plans.

The significant actuarial assumptions were as follows:

31 December 2021

31 December 2020

Discount rate beginning of year

0.10%

0.25%

Discount rate end of year

0.35%

0.10%

Inflation rate

1.00%

Salary increase

1.00%

Social security increase rate

1.00%

Pension increase rate (in payment)

0.00%

Assumptions regarding future mortality are set based on the BVG 2020 generational mortality

tables that were published on 15 December 2020 and are based on the experience during period

2015 to 2019 of the largest autonomous Swiss pension plans. The normal retirement age for men

is 65 and for women it is 64.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

125

Sensitivity analysis:

The sensitivity of the defined benefit obligation to changes in the actuarial principal

assumptions is:

Liability value

31 December 2020

Impact

Percentage

Base cost

955

Sensitivities

Discount rate + 25 bps

904

(51)

-6%

Discount rate - 25 bps

1 011

56

6%

Inflation +50 bps

976

21

2%

Inflation –50 bps

936

(19)

-2%

Salary increases +50

bps

976

21

2%

Salary increases - 50

bps

936

(19)

-2%

Social security increase

rate +50bps

976

21

2%

Social security increase

rate -50bps

936

(19)

-2%

Lower exit rate

assumptions

1 436

481

33%

Liability value

31 December 2021

Impact

Percentage

Base cost

845

Sensitivities

Discount rate + 25 bps

805

(40)

-5%

Discount rate - 25 bps

888

43

5%

Inflation +50 bps

858

14

2%

Inflation –50 bps

832

(13)

-2%

Salary increases +50

bps

858

14

2%

Salary increases - 50

bps

832

(13)

-2%

Social security increase

rate +50bps

858

14

2%

Social security increase

rate -50bps

832

(13)

-2%

Lower exit rate

assumptions

1 142

298

35%

16.

Share-based payments

Stock Purchase Plan

In December 2008, the Company adopted the stock purchase plan (“SPP”), as amended in

2010 and 2011. Under the SPP, the Company grants share purchase rights to all eligible

employees and contractors who provide significant services to the Company. Since the

Company was a Dutch B.V. incorporated in the Netherlands, any transfer of shares to

employees required prior notarization. Thus, rather than directly issuing Company shares to

the employee, the Company issues depository receipts to its employees as evidence of their

beneficial and economic ownership of the Company. The depository receipts are issued

through Stichting Administratie kantoor Meltwater Holding (“STAK”), a Dutch entity that was

created by the Company for the purpose of facilitating the issuance of depository receipts.

The Company issues or transfers the relevant number of Company shares to STAK for the

benefit of the relevant participants and STAK, in due observance of its articles of association

Meltwater N.V. – Annual consolidated and company only financial statements 2021

126

and in accordance with its terms and conditions of administration, issues one depositary

receipt to the relevant eligible participant for each Company share issued.

Employees are invited to participate in the SPP, when the Company’s Board of Directors

approves an offering, typically once a year or once every two years. The Board of Directors

determines the terms of the purchase, including employee eligibility, acquisition price, and

maximum number of depository receipts that participants may purchase according to

eligibility levels. The purchase price is due and payable upon the purchase of the shares;

however, participants may elect to submit payment in whole or in part via payroll deductions.

Deferred payments, plus interest (annualized rate of 4.50%), are deducted in equal

instalments from the employee’s salary over a six-month period, commencing at the issuance

of the depositary receipts. The Company has a full recourse provision in instances where an

employee leaves the Company.

SPP participants with fully-paid depository receipts have full entitlement to all the economic

benefits and risks of the shares as shareholders. The depository receipts vest in two to three

tranches over one to three years.

Generally, depository receipts are transferable once they are vested. In the event of

termination of employment services, the shares can be repurchased by the Company at a

repurchase price

determined in accordance with the provisions of the SPP, which depends on the original sale

price of the shares, the fair market of the shares at the time of repurchase, and the reason for

the employee’s departure from the Company.

As of 31 December 2021, and 2020, STAK owned 770 780 and 4 731 200 shares of Series A

common shares, against which 348 750 and 4 366 000 depository receipts had been issued to

employees pursuant to the program, and 422 030 and 365 200 shares remained unissued,

respectively.

During each of the years ended 31 December 2021 and 2020, the Company recorded no

compensation expense related to the SPP.

2011 Equity Incentive Plan

In June 2011, the Company adopted the 2011 Equity Incentive Plan (“2011 EIP”), with

30 000 000 shares of Series A common shares reserved for issuance under the 2011 EIP. Equity

awards granted under this plan may be incentive share options, non-statutory share options,

restricted shares or restricted share units. Non-statutory share options, restricted shares and

restricted share units may be granted to employees, directors, and consultants. Incentive

share options may only be granted to employees. The exercise price of incentive share options

and non-statutory share options may be no less than fair market value per share on the date

of grant. Options granted under the 2011 EIP have a term of up to ten years from the date of

grant. The vesting for options granted under the plan vary, generally monthly over a period of

three to four years and are subject to certain liquidity and other conditional events that the

Company did not deem probable as of 31 December 2020. The liquidity event condition is

satisfied on the earlier of (i) an acquisition or change in control of the Company or (ii) one

hundred and eighty days after the effective date of the Company filing a registration

statement on Form S-1 (or equivalent filing) with the Securities and Exchange Commission for

the initial public offering of its shares. Vested but unexercised options generally expire within

ninety days after termination of services with the Company. No more awards are currently

subject to these terms as of 31 December 2021.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

127

In April 2021, the Company modified RSU Agreements to change the vesting terms so that 50%

of RSUs vest on 4 December 2021 and the remaining 50% vest on 31 March 2022 with no

Liquidity Event condition. In addition, the Company modified the termination date of these

RSUs to 31 December 2022. The modification is effective only upon the execution of

Amendment Letter by the awardee. The amount of incremental fair value resulting from the

modification was $50.2 million and the amount of incremental expenses recognized in 2021

resulting from the modification was $40.9 million.

During September 2021, 2 820 561 options (selected option awards) were also modified to

change the vesting conditions. These modified awards originally included a liquidity event (exit

event) and accompanying vesting period as a requisite to vest. During the third quarter the

conditions were modified to remove the liquidity event since that was deemed improbable of

being met. The corresponding vesting period was also removed that resulted in all options

deemed vested on the grant date. The expiration date of these options was extended by 5

years to enable the holders of these modified awards to still exercise them after the

modification. Modification accounting was applied to these awards. The amount of

incremental fair value resulting from the modification was $11.2 million and the amount of

incremental expenses recognized in 2021 resulting from the modification was $11.2 million.

On 2 December 2020, the Company effected a one hundred-for-one share split to shareholders

of record as of the same day. All share, par value, options, restricted share unit (“RSU”) and per

share information has been retroactively adjusted to reflect the share split. These tables below

reflect the shares after share split.

The following table summarizes the Company’s share option activity related to the 2011 EIP for

the two years ended 31 December 2021 and 2020:

Number of

share options

outstanding

Weighted-

average

exercise

price

Weighted-

average

remaining

contractual

term

(in years)

Balance as of 1 January 2020

37 240 800

1,31

6,71

Granted

3 520 000

2,00

Exercised

(865 400)

1,26

Forfeited or cancelled

(4 056 500)

1,45

Balance as of 31 December 2020

35 838 900

1,36

5,94

Granted

7 059 600

5,26

Exercised

(4 046 816)

1,35

Repurchased

(1 616 024)

1,03

Forfeited or cancelled

(4 618 125)

1,61

Balances as of 31 December 2021

32 617 535

2,13

6,36

Options exercisable as of 31 December 2021

24 807 979

1,39

5,36

Restricted share units granted under 2011 EIP are valued at their fair market value on the date

of grant and have a term of up to ten years from the date of grant.

The weighted average share price at the date of exercise is $5.38 for the current financial year

(2020: $3.38).

The range of exercise prices for share options outstanding as at 31 December 2021 is $0.83 to

$5.73.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

128

Restricted share units (RSUs)

The following table summarizes the Company’s RSU activity related to the 2011 EIP for the two

years ended 31 December 2021 and 2020:

Number of

RSU’s

outstanding

Weighted-

average fair

value price

Weighted-

average

remaining

contractual

term

(in years)

Balance as of 1 January 2020

10 938 100

1,13

2,45

Forfeited or cancelled

(675 100)

1,23

Balance as of 31 December 2020

10 263 000

1,13

2,57

Granted

1 064 239

5,18

Vested

(4 896 050)

5,21

Repurchased

(3 928)

0,88

Forfeited or cancelled

(841 554)

1,28

Balances as of 31 December 2021

5 585 707

5,32

0,64

In April 2020, the Company extended the expiration date by 5 years for 2 516 200 RSUs that

were initially scheduled to expire during 2020. This extension did not result in an additional

accounting impact since the corresponding vesting condition (liquidity event) did not change

as a result of the modification. The liquidity event was deemed improbable before and after

the extended expiration date.

The following table summarizes the Company’s activity of available share-based awards

related to the 2011 EIP for the two years ended 31 December 2021 and 2020:

Number of

available

awards

Balance as of 1 January 2020

661 200

Granted

(3 520 000)

Forfeited or cancelled

4 731 600

Balance as of 31 December 2020

1 872 800

Increase in shares authorized

8 700 000

Granted

(8 123 839)

Forfeited or cancelled

5 459 679

Balances as of 31 December 2021

7 908 640

The Company recognized share-based compensation expense as follows:

2021

$’000

2020

$’000

Cost of sales

1 642

24

General and administrative

7 935

655

Sales and marketing

36 815

3 501

Research and development

14 033

1 589

Total share-based compensation

60 425

5 769

Meltwater N.V. – Annual consolidated and company only financial statements 2021

129

Determining fair value of share options

The assessed fair value at grant date of options granted during the year ended 31 December

2021 was $2,80 per option (2020 – $1.33). The estimated grant date fair value of all the

Company’s equity-based awards was calculated by applying the Black-Scholes option-pricing

model to the Employee Incentive Plan options using the following input factors for the years

ended 31 December 2021 and 2020:

2021

2020

Expected term (years)

5,88

5,81

Weighted-average volatility

57.6%

49.4%

Risk-free interest rate

1.2%

0.5%

Expected dividend yield

-

Determining the fair value of modified share options

The assessed fair value of the options modified at date of modification was $3,95 per option.

The estimated fair value at modification date of the modified share options was calculated by

applying the Black-Scholes option-pricing model to the Employee Incentive Plan options using

the following input factors for the year ended 31 December 2021:

2021

Expected term (years)

5,26

Weighted-average volatility

61.4%

Risk-free interest rate

0.8%

Expected dividend yield

-

Dividend yield

To date, the Company has not declared or paid any cash dividends and has no plans to do so

in the future. Therefore, the Company used an expected dividend yield of zero.

Risk-free interest rate

The risk-free interest rate assumption is based on the zero-coupon U.S. Treasury instruments on

the date of grant with a maturity date consistent with the expected term of share options

granted to the Company’s employees.

Volatility

Since the Company was private at the time of the offer and did not have any trading history

for its common shares, the expected share price volatility was calculated based on the

average volatility for comparable publicly traded companies for time horizons equal to the

expected term of the share option grants. The Company does not have sufficient historical

share price to utilize Meltwater historical data for volatility, as such, the Company utilizes

peer-group historical share prices to calculate volatility.

Expected Term

There is no historical information available to the Company to develop reasonable

expectations about future exercise patterns and post-vesting employment termination

behaviour for the share option grants to the Company’s employees. As such, the expected

term was estimated using data from comparable publicly traded companies.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

130

17.

Trade and other payables

31

December 2021

$’000

31

December 2020

$’000

Trade payables

11 971

6 931

Wage taxes and social securities

8 179

16 803

VAT

15 594

11 821

Accrued expenses

48 158

35 387

Audit fees

1 361

2 177

Net salaries

32 222

36 990

Deferred and contingent purchase considerations

4 607

-

Other payables

809

4 565

122 901

114 674

The carrying values of trade and other payables are a reasonable approximation of fair value

due to their short-term nature.

The net salaries accrual consists of salaries to the value of $8.53 million (2020: $17.88 million),

bonuses of $13.42 million (2020: $12.08 million), commissions of $8.53 million (2020: $5.39

million) and social charges of $1.71 million (2020: $1.63 million).

18.

Borrowings

Non-convertible loans

$’000

Total

$’000

Balance at 1 January 2020

175 516

Additions

25 000

Accrued interest

22 640

Repayment

(228 683)

Debt issuance cost

5 527

Balance at 31 December 2020

-

Additions

25 000

Additions due to acquisitions

59

Balance at 31 December 2021

25 059

Balance at 31 December 2021

25 059

of which (duration)

-

< 1 year

13

≥1 year ≤ 5 years

25 046

> 5 years

-

Repayment obligations falling due within 12 months from the end of the financial year, as set

out above, are included in current liabilities.

2019 Note Payable

In February 2019, the Company entered into a $175 million non-convertible note payable

agreement with a consortium of private lenders (“2019 Note Payable”) which was due to

Meltwater N.V. – Annual consolidated and company only financial statements 2021

131

mature in February 2024. The 2019 Note Payable accrues interest on a quarterly basis, of

which 4.00% is payable either at the loan's maturity or upon prepayment of the note and the

remainder is payable on a quarterly basis. The loan agreement provides for the Company to

elect the interest rate from alternatives that include Prime Rate plus 8.50% per annum and

LIBOR plus 9.50% per annum. During the year ended 31 December 2019, the interest rates used

to accrue and pay interest ranged from 11.40% to 12.10%. Principal is payable either at the

loan's maturity or upon prepayment of the note.

In August 2020, the Company entered into amendments to the 2019 Note Payable, which

resulted in, among other effects (i) certain amendments to non-financial covenants, (ii)

amendments to all of the financial covenants, including eliminating the consolidated senior

leverage ratio through 31 December 2020 and raising the ratio from 31 December 2020 through

the maturity date, and (iii) $25.0 million of additional liquidity.

2020 Credit Facility

In December 2020, the Company entered a multi-currency revolving credit facility (the “2020

Credit Facility”) of $150.0 million. The maturity date of the 2020 Credit Facility is three years

from when the first utilization occurs with an option to extend an additional one to two years.

Interest accrues on amounts outstanding under the 2020 Credit Facility at LIBOR plus a margin

range of 1.50% to 2.00% per annum. The interest rate margin on unpaid balances is based on

the Company’s leverage ratio. The Company may choose to repay or reduce its commitments

under the 2020 Credit Facility at any time.

The 2020 Credit Facility contains a covenant to provide the Company’s financial statements

within a certain time period, and a covenant requiring compliance with a financial leverage

ratio. The 2020 Credit Facility also includes acceleration of repayment of the borrowings upon

event of default, including a material adverse change clause.

As of 31 December 2020, the Company had not drawn any borrowings under the 2020 Credit

Facility and had the ability to borrow $150.0 million under the 2020 Credit Facility. The

arrangement fees for the 2020 Credit Facility have been capitalized in Other non-current assets

in the Company’s consolidated balance sheet and are amortized over the term of the 2020

Credit Facility since the first utilization occurred and the amortization expense are included in

interest expense in the Company’s consolidated statement of operations.

In June 2021, the Company drew down $25 million from the Revolving Credit Facility which

remained outstanding as of 31 December 2021.

As of 31 December 2021, the undrawn credit facility of the Company is $125 million (31 December

2020: $150 million).

After year end the Company drew down an additional $10 million from the Revolving Credit

Facility. At the reporting date the undrawn credit facility of the Company is $115 million.

19.

Other non-current liabilities

31

December 2021

$’000

31

December 2020

$’000

Contingent consideration

9 967

-

Deferred purchase consideration

1 418

-

Other

2 191

-

13 576

-

Meltwater N.V. – Annual consolidated and company only financial statements 2021

132

20.

Contingent asset

Copyright agency limited matter in Australia

Copyright Agency Limited (“CAL”) is an Australian not-for-profit company incorporated for the

purposes of, among other things, licensing the use of copyright material, including news

publications, in print or electronic form. On 1 December 2017, an application was filed by the

Company in the Copyright Tribunal of Australia “CTA” against CAL’s proposed fee increases.

The Company took this step following the unsuccessful attempt to renegotiate the terms of the

existing Scraping License Agreement and Press Clipping Service Agreement. In the application,

Meltwater rejected the proposed terms on the basis that it was unreasonable in respect of fees

and other terms. The Company also believes the proposed terms are against CAL’s mission to

provide simple ways to reproduce, store and share words, images and other creative content, in

return for fair payment to creators offering innovative products and services. Since Meltwater

commenced its proceedings before CTA, other media monitoring organizations in Australia also

commenced CTA proceedings. In October 2021, the CTA ruled favorably for the Company. CAL

filed an appeal, which will likely be heard in May 2022. Subject to the appeal, the favorable

ruling will result in a refund of fees paid during the course of the application and reduced fees

going forward compared to historical fees.

21.

Contingent liabilities

The Company is subject to litigation arising in the ordinary course of business as described

below.

Canadian news publishers civil action

In June 2011, a consortium of Canadian newspaper publishers (Postmedia Networks, Inc., The

Globe and Mail Inc., Toronto Star Newspapers Limited, Metroland Media Group Ltd., Sun Media

Corporation, The Halifax Herald Limited, Transcontinental Inc., Le Devoir Inc., and CEDROM-SNi

Inc.) commenced an action in the Ontario Superior Court against Meltwater News Canada,

Meltwater US Holding Inc., Meltwater News US Inc., and Meltwater N.V. (collectively

“Meltwater”), seeking declaratory relief in respect of their alleged copyright in news articles,

headlines, compilations of articles in their newspapers and websites, and claiming damages in

excess of CAD 100 million for alleged copyright infringement, breach of contract, intentional

interference with economic relations and trespass to chattels, punitive damages of CAD 10

million, plus unspecified damages and an accounting of profits under the Copyright Act, pre-

and post-judgment interest and legal costs.

In January 2012, the Company filed a motion to have this claim struck in its entirety on the basis

that the Plaintiffs failed to plead a proper cause of action and was without merit. Since serving

the strike motion, three of the plaintiffs (The Globe and Mail Inc., Toronto Star Newspapers

Limited and Metroland Media Group Ltd.) changed their legal representation and delivered a

Notice of Discontinuance, thus abandoning their claims. The remaining Plaintiffs have agreed

that their claim is limited to content published on news websites and that no recovery is sought

with respect to newspapers per se.

Currently, the remaining claimants are The Halifax Herald Limited, Transcontinental Inc., Le

Devoir Inc., and CEDROM-SNi Inc. Although next steps are for the parties to negotiate a

Discovery Plan to guide documentary discovery, settlement discussions are at an advanced

stage.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

133

In November 2021, Meltwater announced that it has entered into a confidential agreement (the

"Settlement Agreement") with The Halifax Herald Limited, Transcontinental Inc., Le Devoir Inc.

(collectively, the "Publishers") and CEDROM-SNI Inc. ("CEDROM") to settle litigation currently

pending in the Ontario Superior Court of Justice.

The confidential Settlement Agreement fully resolves the Action without any admission of

liability or wrongdoing by any party, any court finding, or any payments to settle the Action.

Claim under labor and employment laws by certain former employees

The Company is party to a claim under labor and employment laws brought by certain former

U.S. employees for unpaid wages for meal breaks and overtime. The case is known as wage &

hour. In December 2020, the Company entered into a settlement agreement with the former U.S.

employees, which the Company agreed to pay $14.5 million plus employer payroll taxes. The

Company recognized expense of $14.9 million for the settlement agreement during the year

ended 31 December 2020. In October 2021, the court approved the settlement agreement, which

allowed the Company to make instalment payments, with 66% payable during financial year

2021 and 34% payable during financial year 2022. In Q4 2021 the Company paid a part of the

settlement approximately $10 million related to the wage & hour case in the U.S. The next and

final part of the settlement will be due in 2022.

22.

Revenue from contracts with customers

22.1

Revenue streams

The Company derives its revenue primarily from subscription fees for its cloud-based news

and social media monitoring services. The Company hosts software applications that it makes

available to its customers over subscription periods generally up to 12 months or may extend

to longer periods. The Company provides customers with access to training and support

(included as part of the subscription fees) that help them use the cloud-based news and social

media monitoring services over the subscription periods. Generally revenue is recognized over

a period of time.

22.2

Disaggregation of revenue from contracts with customers

In the following table, revenue from contracts with customers is disaggregated by

geographical market:

2021

2020

$’000

Primary geographical markets

United States

155 931

144 174

Europe, Middle East, Africa, India (EMEA)

Germany

36 284

31 645

United Kingdom

25 775

21 549

Finland

15 969

14 829

Netherlands

13 504

12 493

Sweden

12 339

11 948

Middle East

7 743

7 994

Rest of EMEA

23 341

13 710

Asia Pacific (APAC)

Australia

32 704

29 145

Japan

13 998

13 889

China

10 358

9 612

Hong Kong

10 285

9 853

Singapore

9 697

7 690

Rest of APAC

2 408

1 727

Meltwater N.V. – Annual consolidated and company only financial statements 2021

134

Americas, excluding United States

Canada

30 672

28 651

Rest of Americas

620

882

Total

401 628

359 791

22.3

Contract balances

The following table shows the current period contract liability balance as well as how much of

the revenue recognized in the current reporting period relates to carried-forward contract

liabilities:

31

December

2021

$’000

31

December

2020

$’000

- Contract liabilities

(245 406)

(217 265)

- Revenue recognized that was included in the

contract liability balance at the beginning of

the period

206 124

205 661

The revenue recognized from performance obligations satisfied in prior periods is zero.

22.4

Performance obligations and revenue recognition policies

Revenue is measured based on the consideration specified in a contract with a customer. The

Group recognizes revenue when it transfers control over a good or service to the customer.

The following table provides information about the nature, timing and satisfaction of

performance obligations in contracts with customers:

Type of

product/service

Nature and timing of satisfaction

of performance obligations,

including significant payment

terms

Revenue recognition policies

Subscription

Revenue

The subscription agreements are

non-cancellable and do not

contain provisions for refunds.

Customers do not have any

contractual rights to take

possession of the Company’s

software applications.

The services the Company

provides each day are

substantially the same and have

the same pattern of transfer to the

customer, thus, meeting the

The Company satisfies the

subscription and related services

evenly over the contract period as

customers simultaneously receive

and consume the services

provided.

Revenue is recognized ratably

over the subscription period from

the contract effective date which

is also the date the Company

makes its services available to

customers. Payment is typically

due up-front in its entirety or

Meltwater N.V. – Annual consolidated and company only financial statements 2021

135

definition of a series of distinct

services that form a single

performance obligation.

throughout the contract period,

usually monthly.

Fees for services are generally

fixed, however certain contracts

include variable charges based on

usage that occurs in a given

month. Those variable fees are

recognized as revenue in the

month the usage occurs and

typically are billed in the

subsequent month.

Recorded revenue excludes any

sales, use or other similar taxes

that the Company is required to

collect from customers for

remittance to governmental

authorities.

23.

Personnel costs

2021

$’000

2020

$’000

Wages and salaries

258 250

172 878

Social charges

20 540

15 913

Pension costs

4 672

4 106

Other

(4 450)

5 968

279 012

198 865

The average number of employees of the Group during the 2021 year, converted to full-time

equivalents was as follows: 1 962 of which 56 in the Netherlands (2020: 1 785 of which 50 in the

Netherlands).

The average headcount, representing full-time employees per department is presented below:

Employees by department

31 December 2021

31 December 2020

Cost of sales

225

177

Sales and marketing

1 268

1 202

General and administrative

156

135

Research and development

313

271

1 962

1 785

Meltwater N.V. – Annual consolidated and company only financial statements 2021

136

24.

Material profit and loss items

Included in profit and loss are the following material items:

2021

$’000

2020

$’000

IT hosting

26 120

23 745

Content licensing and partnership

56 104

49 117

Professional fees

30 923

18 114

Amortization of intangible assets

22 349

20 923

Depreciation expense

12 856

13 885

Licenses, leases and equipment

14 097

12 205

Independent Auditor’s fee

Other costs include, among others, independent auditor’s fees. PricewaterhouseCoopers

Accountants N.V. served as the independent public accountants for the fiscal year ended 31

December 2021 and 31 December 2020. The following table presents the aggregate fees

rendered by PricewaterhouseCoopers Accountants N.V. and other professional firms:

Pricewaterhouse

Coopers

Accountants N.V.

$’000

Pricewaterhouse

Coopers

Accountants N.V.

member firms

$’000

Total

2021

$’000

Audit of the financial

statements

414

6 668

7 082

Tax service

-

100

Other non-audit services

-

69

414

6 837

7 251

Pricewaterhouse

Coopers

Accountants N.V.

$’000

Pricewaterhouse

Coopers

Accountants N.V.

member firms

$’000

Total

2020

$’000

Audit of the financial

statements

108

2 392

2 500

Tax service

-

172

Other non-audit services

-

7

108

2 571

2 679

25.

Finance costs

2021

$’000

2020

$’000

Interest expense on third party loans

673

22 351

Interest on taxation

102

283

Interest on leases

4 088

3 805

Loss on extinguishment of loan

-

34 346

Interest on employee benefit obligation

2

6

Finance costs

4 865

60 791

Meltwater N.V. – Annual consolidated and company only financial statements 2021

137

26.

Finance income

2021

$’000

2020

$’000

Related party interest income

-

3 909

Interest on defined benefit plan assets

6

10

Other finance income

426

-

Finance income

432

3 919

27.

Income tax

Major components of income tax expense are as follows:

2021

$’000

2020

$’000

Current tax expense

Current year

4 826

2 910

Deferred tax expense

Origination and reversal of temporary differences

360

(2 540)

Recognition of previously unrecognized tax assets

(4 200)

-

Prior period true up

(204)

254

Total deferred tax expense/(benefit)

(4 044)

(2 286)

Income tax expense reported in the Statement of profit or loss

782

624

a.

Reconciliation of income tax expenses

2021

$’000

2020

$’000

Loss before tax

(77 156)

(75 367)

US Federal taxes

(16 203)

(15 652)

US State taxes

87

(6)

Permanent non-deductible transactions

2 563

(129)

Share based compensation

14 839

-

Research & Development credit

(732)

(731)

Tax reserves

(17)

(10 385)

Others

129

3

Non-US Operations

(739)

1 132

Tax attributes (including losses) not recognized

7 469

2 634

Use of unrecognized tax attributes

(2 414)

5 957

Debt settlement

-

9 003

Tax return adjustments

-

8 798

Recognition of previously unrecognized tax assets

4 200

-

Income tax expense at effective tax rate

782

624

Effective tax rate

(1.0)%

(0.8)%

The US federal tax rate is used to reconcile to the effective tax rate as this is the Company’s

highest level of operational activity as well as being jurisdiction with the largest revenue

generation. The difference between the Company’s effective tax rate and the Netherlands

statutory rate of 25% is primarily due to net operating losses for which the related deferred

Meltwater N.V. – Annual consolidated and company only financial statements 2021

138

tax assets have not been valued due to uncertainty of realization thereof, recognition of share

based compensation taxes as well as the recognition of previously unrecognized deferred tax

assets. Additionally, there have been some significant non-deductible debt settlement

expenses which contributes to the difference.

Deferred taxes reconciliation per the statement of financial position:

2021

$’000

2020

$’000

Deferred tax asset

8 586

4 289

Deferred tax and other tax liability

(13 824)

(7 005)

- Deferred tax liabilities

(7 155)

(2 662)

- Other long term tax liabilities

(6 669)

(4 343)

Net deferred tax asset/(liability)

1 431

1 627

b.

Movement in deferred tax balances

Movement in deferred tax balances 2021:

Net

balance at

31 December

2020

$’000

Recognized

in profit or

loss

$’000

Recognized

in OCI

$’000

Recognized

directly in

equity

$’000

Attributable to

business

combination

$’000

Net

balance at

31 December

2021

$’000

Deferred tax asset

Operating leases

1 219

2 126

-

3 345

Net operating losses

616

(44)

-

144

716

Accrued liabilities

494

(350)

-

144

Share based

compensation

1 928

145

-

(1 219)

-

854

Intangible assets

-

4 648

-

(2 374)

2 274

Other

3 077

27

-

3 104

Deferred tax liability

Operating leases

(1 260)

(578)

(17)

-

(469)

(2 324)

Contract costs

(908)

(1 879)

-

(2 787)

Others

(3 539)

(356)

-

(3 895)

Net deferred tax

asset / (liabilities)

1 627

3 739

(17)

(1 219)

(2 699)

1 431

Meltwater N.V. – Annual consolidated and company only financial statements 2021

139

Movement in deferred tax balances 2020:

Net

balance at

1 January

2020

$’000

Recognized

in profit or

loss

$’000

Recognized

in OCI

$’000

Recognized

directly in

equity

$’000

Net

balance at

31

December

2020

$’000

Deferred tax asset

Operating leases

392

827

-

1 219

Net operating losses

-

616

-

616

Accrued liabilities

159

335

-

494

Share based

compensation

-

247

-

1 681

1 928

Other

894

2 139

-

44

3 077

Deferred tax liability

Operating leases

(1 318)

58

-

(1 260)

Contract costs

(271)

(637)

-

(908)

Others

(2 235)

(1 300)

-

(4)

(3 539)

Net deferred tax asset /

(liabilities)

(2 379)

2 285

-

1 721

1 627

Included in the line item Others is the recognition of deferred tax liabilities on intangible assets,

as well as the distinction between jurisdictional revenue accounted for differently based on

local taxation regulations.

c.

Unrecognized deferred tax assets

Deferred tax assets have not been recognized in respect of the following items, as it is not

probable that future taxable profit will be available against which the Group can use the

benefits there from:

31

December 2021

$’000

31

December 2020

$’000

Loss carried forward

43 479

29 372

Credit carried forward

6 897

5 845

Interest

-

6 499

Share based compensation

4 780

7 598

Others

8 937

17 417

Unrecognized deferred tax assets

64 093

66 731

Expire

30 603

32 059

Never expire

33 490

34 672

Approximately $18 million of unrecognized deferred tax losses that have expiration date will

expire from 2021 until 2024 followed by $7 million which will expire between 2021 and 2027

while $3 million will start expiring only after 2030.

d.

Uncertain tax positions

Meltwater takes income tax positions that management believes are supportable and are

intended to withstand challenge by tax authorities. Some of these positions are inherently

uncertain and include the interpretation of income tax laws applied to complex transactions.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

140

The Company periodically reassesses its tax positions. Changes to the financial statement

recognition, measurement, and disclosure of tax positions is based on management’s best

judgment given any changes in the facts, circumstances, information available and applicable

tax laws. Considering all available information, the Company believes that the ultimate

resolution of such matters will not have a material effect on the Company’s financial position,

statements of operations or cash flows.

28.

Earnings/(loss) per share

28.1

Basic earnings/(loss) per share

2021

2020

Cents

From continuing operations attributable to the ordinary

equity holders of the Company

(26)

(31)

Total basic earnings/(loss) per share attributable to the

ordinary equity holders of the Company

(26)

(31)

28.2 Diluted earnings/(loss) per share

2021

2020

Cents

From continuing operations attributable to the ordinary

equity holders of the Company

(26)

(31)

Total diluted earnings/(loss) per share attributable to the

ordinary equity holders of the Company

(26)

(31)

28.3

Reconciliations of earnings/(loss) used in calculating earnings/(loss) per share

2021

2020

$’000

Basic earnings/(loss) per share

Loss attributable to the ordinary equity holders of the

Company used in calculating basic earnings per share:

From continuing operations

(77 938)

(75 991)

(77 938)

(75 991)

Diluted earnings/(loss) per share

Loss from continuing operations attributable to the ordinary

equity holders of the Company:

Used in calculating basic earnings/(loss) per share

(77 938)

(75 991)

Used in calculating diluted earnings/(loss) per share

(77 938)

(75 991)

Loss attributable to the ordinary equity holders of the

Company used in calculating diluted earnings/(loss) per

share

(77 938)

(75 991)

28.4

Weighted average number of shares used as the denominator

2021

2020

Number

Weighted average number of ordinary shares used as the

denominator in calculating basic earnings/(loss) per share

296 094 630

241 773 599

Meltwater N.V. – Annual consolidated and company only financial statements 2021

141

Weighted average number of ordinary shares and potential

ordinary shares used as the denominator in calculating

diluted earnings/(loss) per share

296 094 630

241 773 599

28.5

Information concerning the classification of securities

Details relating to the share options are set out in note 16.

29.

Related parties

29.1

Key management personnel (‘KMP’) remuneration

KMP consists of 6 directors (2020: 6) and 1 employee (2020: 2) that form the management and

leadership teams. The total remuneration of key management personnel was as follows:

2021

2020

$’000

Short-term employee benefits

1 587

1 327

Post-employment benefit

6

-

Share-based payment benefits

1 024

245

Remuneration of key management personnel

2 617

1 572

29.2 Related party transactions

Meltwater Foundation and Meltwater Entrepreneurial School of Technology (“MEST”)

The Company’s executive director is a director at the Meltwater Foundation and MEST, both of

which are not-for-profit organizations. The Company made charitable contributions of $2.5

million and $2.4 million to Meltwater Foundation in 2021 and 2020, respectively. These

contributions were made with the restriction that the funds will be donated to MEST.

Sublease Agreement with Shack15

The Company’s executive director is a founder of Shack15. In February 2019, the Company

entered into a new sublease with Shack15 to rent office space. In August 2019 and December

2020, the Company amended the agreement to extend the term of the sublease. The sublease

is expected to end in June 2023 with a total obligation of $6.0 million during the term. As of 31

December 2021, Meltwater has no obligation outstanding.

29.3 Outstanding balances arising from sales/purchases of goods and services

The following balances are outstanding at the end of the reporting period in relation to

transactions with related parties:

Related party receivables

1 January

2020

$’000

Cash

payments/

(receipts)

$’000

Foreign

currency

movements

$’000

Interest

$’000

31

December

2020

$’000

Chief executive officer

30 944

(35 051)

-

4 107

-

STAK

62

-

5

-

67

Other

61

-

2

-

63

Total before allowance for

doubtful collection

31 067

(35 051)

7

4 107

130

Meltwater N.V. – Annual consolidated and company only financial statements 2021

142

Allowance for doubtful

collection

(61)

-

(2)

-

(63)

Total related party

receivables

31 006

(35 051)

5

4 107

67

The loan to the Chief Executive Officer amounting to $35.1 million was fully settled during the

2020 financial year.

1 January

2021

$’000

Cash

payments/

(receipts)

$’000

Foreign

currency

movements

$’000

Interest

$’000

31

December

2021

$’000

STAK

67

-

(5)

-

62

Other

63

-

(2)

-

61

Total before allowance for

doubtful collection

130

-

(7)

-

123

Allowance for doubtful

collection

(63)

-

2

-

(61)

Total related party

receivables

67

-

(5)

-

62

30.

List of subsidiaries

The Group’s subsidiaries at 31 December 2021 are set out below. Unless otherwise stated, they

have share capital consisting solely of ordinary shares that are held directly by the Group, and

the proportion of ownership interests held equals the voting rights held by the Group. The

registered office is also their principal place of business.

31

December

2021

31

December

2020

Entity name

Location

%

Meltwater N.V.

Amsterdam, Netherlands

Deepreason.ai Ltd

London, United Kingdom

100

-

Klear.com. Ltd

San Francisco, US

100

-

Linkfluence SAS

Paris, France

100

-

Linkfluence Asia Pte. Ltd.

Singapore

100

-

Linkfluence China Co. Ltd.

Shanghai, China

100

-

Linkfluence Corp.

New York, US

100

-

Linkfluence France SAS

Paris, France

100

-

Linkfluence Germany GmbH

Dusseldorf, Germany

100

-

Linkfluence Ltd

London, United Kingdom

100

-

Scoop.it SAS

Paris, France

100

-

Scoop.it Inc.

San Francisco, US

100

-

Meltwater Emerald Ltd

Dublin, Ireland

100

Meltwater (UK) Ltd

London, United Kingdom

100

Uberlabs Software

Technologies Private Ltd

London, United Kingdom

0,03

Meltwater Argentina BV

Amsterdam, Netherlands

100

Meltwater News

Software Brasil Ltda.

São Paulo, Brazil

0,01

Meltwater News AR

S.R.L.

Amsterdam, Netherlands

90

Meltwater News AR1

S.R.L

Amsterdam, Netherlands

90

Meltwater India Pvt. Ltd.

New Delhi, India

1

Meltwater N.V. – Annual consolidated and company only financial statements 2021

143

Meltwater Middle East1

FZ LLC

Dubai, United Arab Emirates

100

Meltwater Middle East2

FZ LLC

Dubai, United Arab Emirates

100

Meltwater News

Shanghai Co., Ltd.

Shanghai, China

100

Meltwater Australia Pty Ltd

Sydney, Australia

100

Meltwater Danmark ApS

Copenhagen, Denmark

100

Meltwater Deutschland GmbH

Berlin, Germany

100

-

Meltwater Finland OY

Helsinki, Finland

100

Meltwater India Pvt. Ltd.

New Delhi, India

99

Meltwater Japan K.K.

Tokyo, Japan

100

Meltwater KFT

Budapest, Hungary

100

Meltwater News AR S.R.L

Buenos Aires, Argentina

10

Meltwater News AR1 S.R.L

Buenos Aires, Argentina

10

Meltwater News AS

Oslo, Norway

100

Meltwater News AT1 GmbH

Vienna, Austria

100

Meltwater News Canada

Inc (British Columbia

Registered)

Toronto, Canada

100

Meltwater News

Deutschland GmbH

Berlin, Germany

100

Meltwater News FR1 SAS

Bordeaux, France

100

Meltwater News HK Ltd

Hong Kong

100

Meltwater News HK1 Ltd

Hong Kong

100

Meltwater news

International Holdings

GmbH

Schaffhausen, Switzerland

100

Meltwater News

International GmbH

Schaffhausen, Switzerland

-

100

Meltwater News Malaysia

Sdn Bhd

Kuala Lumpur

100

Meltwater News SA1 (Pty)

Ltd

Cape Town, South Africa

100

Meltwater South Africa

(Pty) Ltd

Cape Town, South Africa

100

Meltwater News SG1 Pte

Ltd

Singapore

100

Meltwater News Software Brasil

Ltda.

São Paulo, Brazil

99,99

Meltwater Singapore Pte

Ltd

Singapore

100

Meltwater Software Private

Ltd

Bangalore, India

99,99

Meltwater Sweden AB

Stockholm, Sweden

100

Meltwater The Netherlands

BV

Amsterdam, Netherlands

100

Meltwater US Holdings Inc.

San Francisco, US

100

Meltwater News US Inc.

San Francisco, US

100

Expion Shanghai Co., Ltd

100

-

Owler Inc.

100

-

Owler India Pte Ltd

100

-

Uberlabs Software

Technologies Private Ltd

London, United Kingdom

99,97

Meltwater News US1 Inc.

San Francisco, US

100

Meltwater Software

Private Ltd

Bangalore, India

0,01

Sysomos UK Ltd.

London, United Kingdom

100

-

Meltwater N.V. – Annual consolidated and company only financial statements 2021

144

31.

Fair value measurement

IFRS 13 establishes a hierarchy that categorizes into three levels the inputs used to measure fair

value by giving the highest priority to quoted prices (unadjusted) in active markets for identical

assets and liabilities (level 1 inputs) and the lowest priority to unobservable inputs (level 3

inputs). In some cases, the inputs used to measure the fair value of an asset or a liability might

be categorized within different levels of the fair value hierarchy. In those cases, the fair value

measurement is categorized in its entirety in the same level of the fair value hierarchy at the

lowest level input that is significant to the entire measurement. Levels used in the hierarchy are

as follows:

Level 1

: The fair value of financial instruments traded in active markets (such as publicly traded

derivatives, and equity securities) is based on quoted market prices at the end of the reporting

period. The quoted market price used for financial assets held by the Group is the current bid

price. These instruments are included in level 1.

Level 2

: The fair value of financial instruments that are not traded in an active market (for

example, over-the-counter derivatives) is determined using valuation techniques which maximise

the use of observable market data and rely as little as possible on entity-specific estimates. If

all significant inputs required to fair value an instrument are observable, the instrument is

included in level 2.

Level 3

: If one or more of the significant inputs is not based on observable market data, the

instrument is included in level 3. This is the case for unlisted equity securities.

Financial instruments at amortized cost

The majority of the Group financial assets and liabilities are carried at amortized cost using

the effective interest method. The fair values of these instruments are not materially different

from their carrying values, since the instruments are either short-term in nature or the interest

rates are on market terms.

There were no transfers between fair value hierarchy levels in 2021 and 2020.

31 December 2021

Financial assets

Note

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Financial assets at fair

value through profit and

loss

8

-

1 292

Financial liabilities

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Contingent consideration

-

13 078

31 December 2020

Financial assets

Note

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Financial assets at fair

value through profit and

loss

8

-

2 036

Financial liabilities

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Contingent consideration

-

632

Meltwater N.V. – Annual consolidated and company only financial statements 2021

145

Fair value measurements using significant unobservable inputs (level 3)

Financial assets

at fair value

through profit

and loss

Contingent

consideration

Total

Opening balance 1 January

2020

2 535

1 119

3 654

Gains/(losses) recognized in

other income

-

192

Payment

-

(679)

Additions

1

-

1

Other (Exchange rate

effects and other)

(500)

-

(500)

Closing balance 31

December 2020

2 036

632

2 668

Additions

-

13 232

Gains/(losses) recognized in

other income

-

(82)

Payment

-

(397)

Other (Exchange rate

effects and other)

(658)

(307)

(965)

Disposals

(86)

-

(86)

Closing balance 31

December 2021

1 292

13 078

14 370

Financial assets at fair value are measured at cost which approximates fair value as such no

disclosures will be included regarding the valuation technique utilised and the sensitivity

analysis of such valuation techniques.

32.

Financial risk management

This note explains the Group’s exposure to financial risks and how these risks could affect the

Group’s future financial performance.

Risk

Exposure arising from

Measurement

Management

Market risk –

foreign currency

exchange

Future commercial

transactions

Recognized financial assets

and liabilities not

Sensitivity analysis

Cash

flow forecasting

Part of the daily

business management

Meltwater N.V. – Annual consolidated and company only financial statements 2021

146

denominated in US Dollar

($)

Market risk –

interest rate

Non-current borrowings at

fixed and variable rates

Sensitivity analysis

Part of the daily

business management

Credit risk

Cash and cash equivalents,

deposits trade and other

receivables

Aging analysis

Credit ratings

Diversification of bank

accounts and the

placement of cash with

major financial

institutions

Ongoing credit

evaluation is performed

on the financial

condition of accounts

receivable

Part of the daily

business management

Liquidity risk

Lease liabilities, employee

benefit obligations and

trade and other payables

Maturity analysis

Availability of committed

credit lines and

borrowing facilities

Prudent cash

management policies

Susceptibility of the Group to financial risks is monitored as a part of its daily management of

the business. Exchange rate exposures are monitored by the Group’s Corporate Treasurer.

32.1

Market risk-

foreign currency exchange

The functional currency of the Company is the US Dollar ($). The Group faces currency risks

related to the transactions carried out in the currencies other than the functional currency. The

Group has not entered into transactions designed to hedge against the foreign currency risks.

There has been no change in the Group’s exposure to market risks or how these risks are

managed and measured.

The Group’s exposure to foreign currency risk at the end of the reporting period, expressed in

US Dollar currency units, was as follows:

Meltwater N.V. – Annual consolidated and company only financial statements 2021

147

31 December

2021

USD

EUR

GBP

CAD

AUD

CNY

AED

HKD

JPY

SGD

SEK

ZAR

INR

ILS

NOK

DKK

MYR

BRL

HUF

ARS

CHF

Total

Trade

Receivable

33 107

17 616

5 904

5 603

4 427

4 019

2 094

2 966

2 436

2 303

2 630

985

763

1 210

729

569

588

141

-

88 090

Receivables

from Related

Parties

62

-

62

Other non-

current assets

5 597

1 711

320

453

845

176

435

125

193

243

103

111

313

22

157

16

7

-

34

-

30

10 891

LT Investments

1 292

-

1 292

Cash and Cash

Equivalents

15 224

8 352

5 735

1

729

2 306

1 410

2 036

777

939

999

619

1 497

997

460

310

295

118

299

31

6

248

44 387

Trade Payable

(5 931)

(836)

(450)

(290)

(276)

(108)

(10)

(48)

(1)

(152)

(64)

(15)

(7)

-

(253)

(21)

(2)

(8)

(19)

(4)

(3 476)

(11 971)

Exposure

49 351

26 843

11 509

7 495

7 302

5 497

4 555

3 820

3 567

3 393

3 288

2 578

2 066

1 692

943

859

711

432

46

2

(3 198)

132 751

31 December

2020

USD

EUR

GBP

CAD

AUD

CNY

AED

HKD

JPY

SGD

SEK

ZAR

INR

ILS

NOK

DKK

MYR

BRL

HUF

ARS

CHF

Total

Trade

Receivable

29 146

13 804

4 895

4 973

4 828

2 898

1 978

2 442

2 623

1 916

2 519

1 067

582

-

656

602

458

295

-

75 682

Receivables

from Related

Parties

-

67

-

67

Deposits

1 708

409

249

374

879

166

213

163

216

246

108

61

226

-

158

16

7

-

37

-

31

5 267

LT Investments

1 662

95

46

-

182

-

2

25

17

-

7

-

2 036

Cash and Cash

Equivalents

49 762

9 490

2 433

3 943

3 039

2 042

639

429

830

600

456

569

405

-

24 322

264

219

80

79

2

325

99 927

Trade Payable

(2 832)

(324)

(292)

(324)

(664)

(15)

(175)

(21)

(2)

(66)

(10)

(55)

9

-

(235)

5

(-)

(4)

(2)

(-)

(1 924)

(6 931)

Exposure

79 446

23 541

7 330

8 966

8 082

5 091

2 837

3 013

3 667

2 696

3 075

1 667

1 239

-

24 908

887

684

371

114

2

(1 568)

176 048

Meltwater N.V. – Annual consolidated and company only financial statements 2021

148

The aggregate net foreign exchange gains/losses recognized in the consolidated statement of

profit and loss and other comprehensive income were:

32.2

Market risk - Foreign currency risk management

The Group undertakes transactions denominated in foreign currencies; consequently exposures

to exchange rate fluctuations arise.

Sensitivity analysis

The Group is exposed to a variety of foreign currencies (see table below).

A possible strengthening (weakening) of the foreign currencies by +/- 10.0% against the US

Dollars at 31 December would have affected the measurement of financial instruments

denominated in a foreign currency and affected equity and profit or loss by the amounts shown

below, expressed in US Dollar currency units. The analysis assumes that all other variables

remain constant and ignores any impact of forecast sales and purchases.

2021

$’000

2020

$’000

Net foreign exchange gain/(loss) included in Profit or loss

5 454

(5 479)

Total net foreign exchange gains/(losses) recognized in

other comprehensive income

(3 467)

1 688

Net foreign exchange gains/(losses) recognized in total

comprehensive income

1 987

(3 791)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

149

31 December

2021

EUR

GBP

CAD

AUD

CNY

AED

HKD

JPY

SGD

SEK

ZAR

INR

ILS

NOK

DKK

MYR

BRL

HUF

ARS

CHF

Currency

strengthening

by 10%

2 684

1 151

750

730

550

456

382

357

339

329

258

207

169

94

86

71

43

5

-

(320)

8 341

Currency

weakening by

10%

(2 684)

(1 151)

(750)

(730)

(550)

(456)

(382)

(357)

(339)

(329)

(258)

(207)

(169)

(94)

(86)

(71)

(43)

(5)

-

320

(8 341)

31 December

2020

EUR

GBP

CAD

AUD

CNY

AED

HKD

JPY

SGD

SEK

ZAR

INR

ILS

NOK

DKK

MYR

BRL

HUF

ARS

CHF

Total

Currency

strengthening by

10%

2 354

733

897

808

509

284

301

367

270

307

167

124

-

2 491

89

68

37

11

-

(157)

9 660

Currency

weakening by

10%

(2 354)

(733)

(897)

(808)

(509)

(284)

(301)

(367)

(270)

(307)

(167)

(124)

-

(2 491)

(89)

(68)

(37)

(11)

(-)

157

(9 660)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

150

32.3

Market risk-

interest rate risk management

The Group’s main interest rate risk arises from long-term borrowings with both fixed and variable

rates which expose the Group to cash flow interest rate risk. Meltwater does not currently have an

interest rate hedging policy as interest is paid when it becomes due. Long term borrowings which

contain a variable interest rate have been extinguished during December 2020. A rolling credit facility

has been entered into for general corporate purpose use to secure the availability of finance on pre-

arranged terms over the facility period.

Sensitivity analysis

The following table illustrates the sensitivity of profit before tax and equity to a reasonably possible

change in interest rates of +/- 1.0% and how it would have affected equity and profit or loss by the

amounts shown below, expressed in US Dollar currency units. All other variables are held constant.

Profit before tax

+1%

-1%

31 December 2021

-142

142

31 December 2020

-1 796

1 796

32.4

Credit risk management

Credit risk arises from cash at bank and trade and other receivables and is considered to be minimal.

Majority of the cash at bank and deposits are held with high credit quality financial institutions with

a credit rating of A or higher. With respect to trade and other receivables the Group mitigates the

credit risk through credit limits for each debtor on post-paid terms. These receivables are extremely

short term in nature.

31

December 2021

$‘000

31

December 2020

$‘000

Trade and other receivables

88 152

75 749

Cash at bank

44 387

99 927

Exposure

132 539

175 676

The credit losses on trade receivables due to bankruptcy has been historically immaterial and are not

expected to be material in the future.

32.5

Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated

with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s

approach to managing liquidity is to ensure as far as possible that it will meet its liabilities when they

are due under both normal and stressed conditions without incurring unacceptable losses or risking

damage to the Group’s reputation.

In December 2020 upon the completion of the private placement and listing the Company received

aggregate proceeds of $237.5 million after deducting underwriting discounts commissions and

offering costs and repaid the 2019 Note Payable with the proceeds.

In December 2020 the Company entered into a multi-currency revolving credit facility (the “2020

Credit Facility”) of $150.0 million. The maturity date of the 2020 Credit Facility is three years from

when the first utilization occurs with an option to extend an additional one to two years. Interest

accrues on amounts outstanding under the 2020 Credit Facility at LIBOR plus a margin range of

1.50% to 2.00% per annum. The Company is required to meet certain covenants in relation to the

Meltwater N.V. – Annual consolidated and company only financial statements 2021

151

2020 Credit Facility. The covenants mainly related to the achievement of a financial leverage ratio.

As of 31 December 2020 the Company had not drawn any borrowings under the 2020 Credit Facility

and had the ability to borrow $150.0 million under the 2020 Credit Facility. During 2021 the Company

drew down $25 million of the $150 million revolving credit facility.

The liquidity risk management implies maintaining sufficient cash and committed credit facilities by

continuously monitoring forecast and actual cash flows and by matching the maturity profiles of

financial assets and liabilities.

The table below analyses the Group’s financial liabilities by their remaining period to maturity based

on the contractual maturity date. The amounts in the table are the contractual undiscounted cash

flows (these amounts may not reconcile to the amounts disclosed on the statement of financial

position for debt to shareholders, participants, related parties, lease liabilities, trade and other

payables).

Within the

next 12

months

$’000

Between 1

and 5 years

$’000

Beyond

5 years

$’000

Total

$’000

31 December 2021

Trade payables

11 971

-

11 971

Lease liabilities

12 501

22 818

75

35 394

Employee benefits

44

873

1 244

2 161

External borrowings

-

25 059

-

25 059

Exposure

24 516

48 750

1 319

74 585

31 December 2020

Trade payables

6 931

-

6 931

Lease liabilities

9 795

22 952

765

33 512

Employee benefits

36

118

1 569

1 723

External borrowings

-

Exposure

16 762

23 070

2 334

42 166

32.6

Capital risk

The Group manages its capital to ensure that entities in the Group will be able to continue as going

concerns while maximising the return to shareholders through the optimisation of the debt and equity

balance. The Group’s overall strategy has changed from 2019 as the Group completed a private

placement and listing raising capital to extinguish borrowing agreements whilst also obtaining a

multi-currency revolving credit facility.

The capital structure of the Group consists of net debt (borrowings disclosed in notes 7 and 18 after

deducting cash and bank balances) and equity of the Group (comprising issued capital reserves

retained earnings and accumulated deficit as disclosed in note 13 and the statement of changes in

Equity).

31

December 2021

$’000

31

December 2020

$’000

Debt

(25 059)

-

Lease liabilities

(29 897)

(33 512)

Cash and Cash equivalents

44 387

99 927

Net debt

(10 569)

66 415

Equity

(47 105)

(34 709)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

152

Net debt to equity ratio

0,22

(1,19)

The ratio indicates what proportion of equity and debt the Company has been using to finance its

assets and how encumbered a company is with debt. Debt does not include trade payables as it

relates to operational activities and not capital activities. The positive ratio as at 31 December 2021

indicates that the Group’s cash at hand does not exceed its debt. The negative ratio as at 31

December 2020 indicates that the Group's cash at hand exceeds its debt.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

153

33.

Financing activities

Non-convertible

loans

Lease liabilities

Euronext Oslo Børs

offering

Repurchase of

shares

Issuance of Common

shares

Total

$’000

Balance at 1 January

2020

175 516

25 792

(- )

-

1 129

202 437

Cash movements:

-

New loans /cash

from offerings

25 000

(- )

248 404

-

1 088

274 492

Repayments of

Principal

(200 000)

(11 371)

(- )

-

(- )

(211 371)

Repayments of

Interest

(28 683)

(3 523)

(- )

-

(- )

(32 206)

Non-cash

movements:

New lease liabilities

recognized

(- )

19 548

(- )

-

(- )

19 548

Interest accrued

22 640

3 608

(- )

-

(- )

26 248

Exchange

differences

(- )

367

(- )

-

(- )

367

Debt issuance cost

amortization

5 527

(- )

-

(- )

5 527

Reassessments and

modifications

(- )

(909)

(- )

-

(- )

(909)

Balance at 31

December 2020

(- )

33 512

248 404

-

2 217

284 133

Meltwater N.V. – Annual consolidated and company only financial statements 2021

154

Balance at 1 January

2021

(- )

33 512

248 404

-

2 217

284 133

Cash movements:

New loans /cash

from offerings

25 000

-

(10 674)

-

5 480

19 806

Purchase of equity

shares

-

(6 927)

-

(6 927)

Repayments of

Principal

-

(10 437)

-

(10 437)

Repayments of

Interest

-

(4 078)

-

(4 078)

Non-cash

movements:

Additions through

acquisitions

59

-

59

New lease liabilities

recognized

-

6 121

-

6 121

Interest accrued

-

4 088

-

4 088

Exchange

differences

-

(682)

Debt issuance cost

amortization

-

Reassessments and

modifications

-

1 373

-

1 373

Balance at 31

December 2021

25 059

29 897

237 730

(6 927)

7 697

293 456

Meltwater N.V. – Annual consolidated and company only financial statements 2021

155

34.

Operating segments

34.1

Products and services from which reportable segments derive their revenues

Information reported to the Group’s Chief Executive Officer (Chief Operating Decision Maker)

for the purposes of resource allocation and assessment of segment performance is focused on

the business activities which generates certain classes of revenue and incurs certain classes of

expenses. The principal business activities generate revenue through one operating segment

namely Media Intelligence, which is also the Group’s reportable segment under IFRS 8.

35.

Standards issued but not yet effective

The amended standards that are applicable to the Company are issued but are not yet effective

for 31 December 2021 are listed below:

• Amendments to IAS 37 Onerous contracts effective for reporting periods beginning on

or after 1 January 2022.

• Amendments to IAS 16 Property Plant and Equipment - Proceeds before Intended Use

effective for reporting periods beginning on or after 1 January 2022.

• Amendments to IFRS 3 that update an outdated reference in IFRS 3 without

significantly changing its requirements effective for reporting periods beginning on or

after 1 January 2022.

• Amendments to IAS 1- Classification of Liabilities as Current or Non-current effective for

reporting periods beginning on or after 1 January 2024.

• Amendments to IAS 1 - Disclosure accounting policies effective for annual periods

beginning on or after 1 January 2023.

• Amendments to IAS 8 – Definition of accounting estimates effective for annual periods

beginning on or after 1 January 2023 to changes in accounting policies and changes

in accounting estimates that occur on or after the beginning of that period.

• Amendments to IAS 12 - Deferred Tax related to Assets and Liabilities arising from a

Single Transaction effective for annual reporting periods beginning on or after 1

January 2023.

The Group will adopt these amended standards when they become effective. The amended

standards are not expected to have a material impact on the Group’s financial statements.

36.

Business combinations

Acquisition of Klear.com Ltd (“Klear”)

On 14 April 2021 we acquired all (100%) of the equity interests in Klear.com Ltd., which is

engaged in influencer marketing technology development, pursuant to the terms of a definitive

Share Purchase Agreement of the same date. The acquisition improved the Company’s

offering of social intelligence-based products and technology services.

Klear.com Ltd. and the Company were parties to a Reseller Agreement dated 12 October 2017

wherein we were granted license to sell market and promote the product offerings of the

acquired company to our customers throughout the world on monthly payment terms.

Through the execution of the Share Purchase Agreement this pre-existing relationship was

effectively settled. No settlement gain or loss was recognized on account of such contractual

preexisting relationship being cancelable by either party without penalty and the stated

settlement provision being zero.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

156

Total purchase consideration to complete the acquisition was $17.8 million consisting of an

upfront cash payment of $11.0 million, preliminary working capital adjustments of $0.3 million,

net cash of $3.8 million and debt assumed of $1.4 million, an adjustment for the settlement of a

pre-existing relationship of $0.8 million along with contingent cash payments of up to $6.8

million upon the achievement of certain performance milestones.

As of the acquisition date $5.6 million contingent cash payments related to the commercial

milestones has been recognized by calculating the present value of the future expected cash

flows. The estimates are based on a discount rate of 2.4% for the General Data Protection

Regulation (GDPR) target amount and 2.5% for the Annual Recurring Revenue (ARR). We will

continue to monitor the commercial milestones at each reporting period. The probability of

occurrence for the GDPR Target Amount Payment a successful platform integration is very

high. Therefore, 100% probability of occurrence for the GDPR Target Amount Payment.

We will continue to monitor the commercial milestones at each reporting period.

Details of the purchase consideration are as follows:

USD ‘000

Purchase consideration:

Base consideration

11 000

Add: Net cash

3 823

Less: Indebtedness

(1 466)

Less: Net working capital adjustment

(313)

Initial Consideration

13 044

Contingent Consideration

5 550

Less: Pre-existing relationship balance

(823)

Total purchase consideration

17 771

The preliminary allocation of consideration transferred is based on management's estimates,

judgments and assumptions. When determining the fair values of assets acquired and

liabilities assumed management made significant estimates, judgments and assumptions.

These estimates, judgments and assumptions are subject to change upon final valuation and

should be treated as preliminary values. Management estimated that consideration paid

exceeded the fair value of the net assets acquired. Therefore goodwill of $12.91 million was

recorded. The goodwill recognized is primarily attributable to the expected synergies to be

achieved from the business combination and is fully deductible for tax purposes.

On 31 December 2021 the contingent consideration has a fair value of $5.6 million with an

increase in fair value amounting to $0.09 million throughout the year. As of 31 December 2021,

the recognized amount of contingent consideration and the key assumptions used to measure

that amount have not changed since the acquisition date.

The assets and liabilities recognized as a result of the acquisition are as follows:

Fair Value

$’000

Cash

4 142

Accounts receivables

617

Prepaid expenses

151

Property, plant and equipment

19

Trademarks

541

Customer relationships

1 626

Developed technology

3 627

Deferred tax Liability

(1 800)

Accounts payable

(6)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

157

Contract liabilities

(1 799)

Accrued expenses & other

(2 257)

Net identifiable assets acquired

4 861

Goodwill

12 910

17 771

Pursuant to the acquisition, an indemnification receivable of $1.52 million has been recognized

with a current tax liability of equal value, as well as the temporary differences related to

deferred tax liability of $1.80 million. This resulted in the additional Goodwill recognition of

$1.80 million leading to the total value of Goodwill on acquisition of $12.91 million.

In addition business transaction costs incurred in connection with the acquisition is $0.72

million of which $0.3 million were incurred in 2021.

The fair value of acquired trade receivables is $0.61 million. The gross contractual amount for

trade receivables due is $1.05 million, with a loss allowance of $0.44 million recognized on

acquisition.

The acquired business contributed revenues of $3.1 million and net profit of $1.8 million to the

Group for the period from 14 April 2021 to 31 December 2021.

If the acquisition had occurred on 1 January 2021, consolidated pro-forma revenue and loss for

the year ended 31 December 2021 would have been $404 million and $76.8 million respectively.

Acquisition of Linkfluence SAS (“Linkfluence”)

On 5 May 2021 the Company acquired 100% of the issued share capital of Linkfluence.

Linkfluence is engaged in the business of providing products and services based on artificial

intelligence to algorithmically mine social media for consumer insights. The combination of

Linkfluence with Meltwater will help the Company achieve a larger scale as Meltwater will

significantly increase the sales force dedicated to sell Linkfluence's products. There are cost

savings associated with the transaction including savings in hosting and content costs.

The purchase consideration related to this acquisition was denominated in Euro. Total

purchase consideration to complete the acquisition was €42.1 million ($51.1 million) consisting

of an upfront cash payment of €14.66 million ($17.59 million) and an upfront issuance of 2 552

260 shares of the Company valued at €13.5 million ($16.3 million) along with additional cash

payments of up to €14 million ($16.8 million) upon the achievement of certain performance

milestones.

The additional cash payments relating to the performance milestones will be recognized if and

when such milestones are probable and can be reasonably estimated. The potential

undiscounted additional cash payment under the agreement is between $0 for sales below

$26.4 million and failure to integrate the platforms and $16.8 million for sales above $39.6

million and successful platform integration. As of the acquisition date, $5.5 million contingent

consideration related to the commercial milestones has been recognized by calculating the

present value of the future expected cash flows. The estimates are based on a discount rate of

1.7% for the successful platform integration and 3.0% for the pre-determined sales. We will

continue to monitor the commercial milestones at each reporting period. The probability of a

successful platform integration is very high. Therefore, 100% probability is assumed of

achieving a successful platform integration.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

158

Details of the purchase consideration is as follow:

EUR‘000

USD‘000

Purchase consideration:

Base consideration

14 660

17 594

Add: Aggregate subscription price of all the Option Shares

834

1 001

Add: Fair value of issued shares

13 547

16 258

Add: Adjustment Escrow Amount

1 256

1 508

Initial Consideration

30 297

36 361

Conciliation debt

7 220

9 265

Contingent consideration

4 550

5 458

Total purchase consideration

42 067

51 084

Conciliation debt includes all debt and accrued unpaid interest (including interest on the

convertible bonds), as well as break costs and other indemnities stipulated in the loan

agreement entered into with the Conciliation Debt creditors, owed by Linkfluence to each of

the Conciliation Debt creditors and comprised by the Conciliation Agreement, which was due

and payable on the Closing Date.

The preliminary allocation of consideration transferred is based on management's estimates,

judgments and assumptions. When determining the fair values of assets acquired and

liabilities assumed, management made significant estimates, judgments and assumptions.

These estimates, judgments and assumptions are subject to change upon final valuation and

should be treated as preliminary values. Management estimated that consideration paid

exceeded the fair value of the net assets acquired. Therefore, goodwill of $37.2 million was

recorded. The goodwill recognized is primarily attributable to the expected synergies to be

achieved from the business combination and is fully deductible for tax purposes.

We are still finalizing the allocation of the purchase price which may be subject to change as

additional information becomes available to us.

On 31 December 2021 the contingent consideration has a fair value of $5.2 million with an

increase in fair value amounting to $0.06 million throughout the year. Due to foreign exchange

rate differences, the contingent consideration balance decreased with $0.3 million throughout

the year. As of 31 December 2021, the recognized amount of contingent consideration and the

key assumptions used to measure that amount have not changed since the acquisition date.

The preliminary assets and liabilities recognized as a result of the acquisition are as follows:

Fair Value

$’000

Cash

6 862

Accounts receivables

3 775

Prepaid expenses and other current assets

8 042

Property, plant and equipment

32

Other assets

377

Trademarks

448

Customer relationships

7 404

Developed technology

6 109

Accounts payable

(1 377)

Contract liabilities

(3 534)

Accrued expenses and others

(13 508)

Other liabilities

(1 161)

Net identifiable assets acquired

13 469

Meltwater N.V. – Annual consolidated and company only financial statements 2021

159

Pursuant to the acquisition, an indemnification receivable of $0.3 million has been recognized

with a current tax liability of equal value, income tax receivable of $0.9 million as well as the

temporary differences related to deferred tax liability of $0.5 million. This resulted in the

reduced Goodwill recognition of $0.4 million leading to the total value of Goodwill on

acquisition of $37.2 million.

In addition business transaction costs incurred in connection with the acquisition is $1.4 million

of which $1.4 million were incurred in 2021.

The acquired business contributed revenues of $10.3 million and net loss of $5.2 mill to the

Group for the period from 5 May 2021 to 31 December 2021.

If the acquisition had occurred on 1 January 2021, consolidated pro-forma revenue and loss for

the year ended would have been $408.7 million and $80.9 million respectively.

Acquisition of Owler Inc. (“Owler”)

On 17 June 2021 the Company acquired all of the ownership interests (100%) in Owler.

pursuant to the terms of definitive Agreement and Plan of Merger of the same date. Owler. is

engaged in the business of providing a community-based competitive insights platform which

is used to outsmart the competition and uncover competitive insights news and alerts. The

acquisition will leverage the combined synergies and expertise of the two dedicated entities

engaged in media intelligence and social analytics.

Total purchase consideration to complete the acquisition was $18.9 million which consisted of

an upfront cash payment of $18.9 million offset by working capital adjustments.

Details of the purchase consideration are as follows:

USD ‘000

Purchase consideration:

Base Purchase Price

18 900

Add: Cash and cash equivalents

401

Less: Unpaid acquisition expenses

(365)

Less: Closing indebtedness

(187)

Less: Estimated Net Working Capital Adjustment

(182)

Estimated Merger Consideration

18 567

Add: Unpaid acquisition expenses

115

Add: Closing indebtedness

187

Total purchase consideration

18 869

Meltwater N.V. – Annual consolidated and company only financial statements 2021

160

The assets and liabilities recognized as a result of the acquisition are as follows:

Fair Value

$’000

Cash

401

Accounts receivables

109

Prepaid expenses

249

Property, plant and equipment

5

Other assets

84

Trademarks

900

Customer relationships

900

Developed technology

6 300

Accounts payable

(75)

Contract liabilities

(906)

Accrued expenses & other

(201)

Net identifiable assets acquired

7 766

Goodwill

11 103

18 869

The preliminary allocation of consideration transferred is based on management's estimates,

judgments and assumptions. When determining the fair values of assets acquired and

liabilities assumed management made significant estimates, judgments and assumptions.

These estimates, judgments and assumptions are subject to change upon final valuation and

should be treated as preliminary values. Management estimated that consideration paid

exceeded the fair value of the net assets acquired. Therefore, goodwill of $11.1 million was

recorded. The goodwill recognized is primarily attributable to the expected synergies to be

achieved from the business combination and is fully deductible for tax purposes.

In addition business transaction costs incurred in connection with the acquisition is $0.1 million

of which $0.1 million were incurred in 2021.

The fair value of acquired trade receivables is $0.11 million. The gross contractual amount for

trade receivables due is $0.17 million, with a loss allowance of $0.06 million recognized on

acquisition.

The acquired business contributed revenues of $1.9 million and net loss of $0.9 million to the

Group for the period from 17 June 2021 to 31 December 2021.

If the acquisition had occurred on 1 January 2021, consolidated pro-forma revenue and loss for

the year ended would have been $403.4 million and $78 million respectively.

Acquisition of DeepReason.ai Ltd (“DeepReason”)

On 19 November 2021 the Company acquired 100% of the issued share capital of DeepReason.

DeepReason has developed a powerful reasoning engine with an industry-first ability to

maintain incremental views of knowledge graphs. With the DeepReason acquisition, Meltwater

will be in a unique position to continue expanding this knowledge graph to discover even more

connections and insights.

Total purchase consideration to complete the business combination was $5.9 million consisting

of an upfront cash payment of $0.8 million and initial deferred issuance of shares of the

Company valued at $0.8 million along with additional cash payments of up to $2.4 million to be

Meltwater N.V. – Annual consolidated and company only financial statements 2021

161

paid in three tranches over a three year period. The issuance of shares in the Company valued

at $2.4 million will be settled upon the achievement of certain performance milestones.

The additional payments relating to the retention and performance milestones will be

recognized if and when such milestones are probable and can be reasonably estimated. The

potential undiscounted additional cash payment under the agreement is between $2.1 million if

no retention is achieved and $2.35 million if full retention is achieved. The potential undiscounted

additional equity payment under the agreement is between $0 if no milestones are achieved

and $2.4 million if all milestones are achieved.

Details of the purchase consideration are as follows:

USD ‘000

Purchase consideration

Cash Consideration

788

Initial Consideration

788

Deferred Consideration: Cash

2 363

Total Equity Consideration

3 150

Deferred Consideration Equity

787

Contingent Consideration: Equity

2 363

Less: Continuing Employment

(236)

Less: Fair Value Adjustment of Equity Consideration

(139)

Estimated Merger Consideration

5 926

Total Purchase Consideration

5 926

The assets and liabilities recognized as a result of the acquisition are as follows:

Fair Value

$’000

Cash

168

Prepaid expenses

87

Property, plant and equipment

5

Other assets

52

Developed technology

3 000

Deferred tax liabilities

(426)

Accounts payable

(47)

Accrued expenses & other

(73)

Other liabilities

(59)

Net identifiable assets acquired

2 707

Goodwill

3 219

5 926

The preliminary allocation of consideration transferred is based on management's estimates,

judgments and assumptions. When determining the fair values of assets acquired and

liabilities assumed management made significant estimates, judgments and assumptions.

These estimates, judgments and assumptions are subject to change upon final valuation and

should be treated as preliminary values. Management estimated that consideration paid

exceeded the fair value of the net assets acquired. Therefore, goodwill of $2.8 million was

recorded. The goodwill recognized is primarily attributable to the expected synergies to be

achieved from the business combination and is fully deductible for tax purposes.

The additional cash payments relating to the performance milestones will be recognized if and

when such milestones are probable and can be reasonably estimated. The potential

Meltwater N.V. – Annual consolidated and company only financial statements 2021

162

undiscounted additional cash payment under the agreement is between $2.1 million and $2.35

million depending on future employment arrangements of certain personnel. As of the

acquisition date the full amount has been recognized as follows $2.1 million contingent

consideration as part of the business combination transaction and $0.25 million as a

provisional payment relating to remuneration of future employment of employees. As of 31

December 2021, the recognized amount of contingent consideration and the key assumptions

used to measure that amount have not changed since the acquisition date.

The additional issuance of equity instruments relating to milestones and new hires

achievement has been recognized as such milestones are probable and can be reasonably

estimated. The potential undiscounted issuance under the agreement is between $0 and

$3.150 million depending on the satisfaction of the set milestones and new hire achievements.

Unsatisfaction or partial satisfaction of the milestones will result in 75%, 25% or 0%

entitlement depending on the period in which milestones are satisfied. Unsatisfaction or partial

satisfaction of new hires achievement will result in the following application (A-P)/(T-P)*0,5. A

representing actual size at end of period and T the target size, whilst P represents target size at

preceding period. A 100% probability of reaching milestones has been applied as a key

assumption in the valuation technique.

The fair value of acquired receivables is $0.14 million. The gross contractual amount for

receivables due is $0.14 million, with a loss allowance of $0 recognized on acquisition.

The acquired business contributed revenues of $0. million and net loss of $0 million to the

Group for the period from 19 November 2021 to 31 December 2021.

If the acquisition had occurred on 1 January 2021, consolidated pro-forma revenue and loss for

the year ended would have been $401.8 million and $78.4 million respectively.

37.

Subsequent events

The Company has evaluated subsequent events between the balance sheet date of 31

December 2021 and 29 April 2022 and determined that the following events and transactions

require disclosure as follows:

Share buyback program – general market

On 3 December 2021, the extraordinary general meeting authorized the Company’s share

buyback program, which included general market repurchases. Under the program, Meltwater

made repurchases of shares in the open market, in line with applicable restrictions, relevant

guidelines and main safe harbor principles on price and volume limitations. The repurchases

began in January 2022 and will remain in place until 30 June 2022 or such earlier time as the

Board of Directors resolves to terminate the program. As of 22 April 2022, Meltwater

repurchased 8 361 454 from the general market for an aggregate cost of $17.6 million. Any

shares repurchased are expected to be used as consideration in future acquisitions or, absent

this, be cancelled.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

163

Meltwater N.V.

Company only annual financial

statements 2021

In accordance with IFRS as adopted in the EU

2021

Meltwater N.V. – Annual consolidated and company only financial statements 2021

164

Company only statement of financial position

as at 31 December 2021

Notes

31

December

2021

$‘000

31

December

2020

$‘000

1

January

2020

$’000

Assets

Non-current assets

Other intangible assets

40

-

127

1 025

Financial Assets – Investments in

subsidiaries

39

413 192

278 657

273 242

Financial assets at fair value through

profit and loss

42

1 292

1 396

1 352

Amounts due from group companies

52

514 241

475 629

151 357

Other non-current assets

46

1 160

-

Total non-current assets

929 885

755 809

426 976

Current assets

Related party receivables

41

62

67

61

Other current assets

45

719

1 029

150

Cash and cash equivalents

47

2 243

31 522

1 733

Total current assets

3 024

32 618

1 944

Total assets

932 909

788 427

428 920

Liabilities

Non-current liabilities

Borrowings

50

25 000

-

Non-current liabilities

43

11 684

-

Total non-current liabilities

36 684

-

Current liabilities

Amounts due to group companies

52

518 930

467 628

341 545

Current liabilities

43

4 607

-

Trade and other payables

55

11 580

10 862

349

Total current liabilities

535 117

478 490

341 894

Total liabilities

571 801

478 490

341 894

Equity

Share capital

48

3 421

29

24

Share premium

48

416 637

349 976

105 179

Accumulated deficit

(40 007)

(18 237)

(212 278)

Accumulated deficit- Net result

(18 943)

(21 831)

194 101

Total equity

361 108

309 937

87 026

Total equity and liabilities

932 909

788 427

428 920

Meltwater N.V. – Annual consolidated and company only financial statements 2021

165

Company only statement of profit or loss and other comprehensive

income for the year ended 31 December 2021

Notes

2021

$’000

2020

$’000

Sales and marketing

expenses

(8 373)

(1 507)

General and administrative

expenses

(42 071)

(28 685)

Research and development

expenses

(3 729)

(76)

Other income

57

29 874

25 516

Operating profit/(loss)

(24 299)

(4 752)

Other Finance costs

(12 274)

(16 555)

Foreign exchange

gain/(loss)

6 250

(4 172)

Other Finance income

11 380

3 650

Profit/(loss) before tax

(18 943)

(21 829)

Income tax expense

53

-

(2)

Profit/(loss) for the year

(18 943)

(21 831)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

166

Company only statement of changes in equity for the year ended 31 December 2021

Share capital

$’000

Share premium

$’000

Other reserves

$’000

Accumulated deficit

$’000

Result for the year

$’000

Total equity

$’000

Notes

48

NL GAAP equity as of 1 January 2020

24

103 360

(1 803)

(311 322)

-

(209 741)

IFRS transition adjustments

Remeasurement of investment in subsidiaries to

cost

-

299 322

-

299 322

Share-based compensation expense

-

1 819

-

(1 819)

-

Other IFRS Transition Adjustments

-

1 803

(4 358)

-

(2 555)

Balance as of 1 January 2020

24

105 179

-

(18 177)

-

87 026

Loss for the period

-

(21 831)

Foreign currency translation adjustments

-

(60)

-

(60)

Total comprehensive income / (loss)

-

(60)

(21 831)

(21 891)

Share-based compensation expense

-

5 769

-

5 769

Issuance of common shares in connection with Euronext

Growth (Merkur) Oslo Børs offering, net of issuance cost

5

237 536

-

237 541

Issuance of Series A common shares

upon exercise of option

-

1 088

-

1 088

Issuance of Series A common shares in

consideration for acquisition

-

404

-

404

Total other movements

5

244 797

-

244 802

Balance as of 31 December 2020

29

349 976

-

(18 237)

(21 831)

309 937

Meltwater N.V. – Annual consolidated and company only financial statements 2021

167

Balance as of 31 December 2020

29

349 976

-

(18 237)

(

21 831)

309 937

Loss for the period

-

(18 943)

Foreign currency translation adjustment

-

(155)

-

61

-

(94)

Total comprehensive income

-

(155)

-

61

(18 943)

(19 037)

Loss from prior period

-

(21 831)

21 831

-

Share-based compensation expense

-

60 425

-

60 425

Issuance of common shares in connection with Euronext

Growth (Merkur) Oslo Børs offering, net of issuance cost

-

(35)

-

(35)

Issuance of Series A common shares

upon exercise of option

5

5 475

-

5 480

Change in par value

3 404

(3 404)

-

Issuance of Series A common shares in

consideration for acquisition

1

16 553

-

16 554

Issuance of Series A common shares in

consideration for post combination services

-

1 527

-

1 527

Issuance of Series A common shares, other

-

895

-

895

Repurchase of series A common shares

(18)

(5 146)

-

(5 164)

Repurchase of equity securities

-

(9 474)

-

(9 474)

Total other movements

3 392

66 816

-

70 208

Balance as of 31 December 2021

3 421

416 637

-

(40 007)

(18 943)

361 108

Meltwater N.V. – Annual consolidated and company only financial statements 2021

168

Company only statement of cash flows

for the year ended 31 December 2021

Notes

2021

2020

$’000

Cash flows from operating activities

Net profit / (loss) before tax

(18 943)

(21 829)

Adjustments for:

Amortization of other intangible assets

40

127

898

Amortization of debt discount and deferred

financing costs

239

-

Share-based compensation expense

312

354

Share-based compensation expense related to post

combination services

1 527

-

Interest expense accrued

12 274

16 555

Finance income

(11 380)

(3 650)

Unrealised FX gains/losses relating to Working

Capital items

(7 763)

5 642

Tax Paid

-

Cash inflows/(outflows) from intercompany

Transactions

(11 693)

(8 780)

Changes in working capital items:

Decrease/ (increase) in other current assets

(856)

(973)

(Decrease)/increase in trade and other payables

3 265

951

Cash generated from / (used in) operating

Activities

(32 891)

(10 832)

Cash flows from investing activities

Proceeds from sales of minority interest

investments

60

-

Amounts paid for business combinations, net of

cash acquired

(31 285)

-

Cash advances and loans made to group

companies

(22 317)

(279 586)

Cash generated from / (used in)

investing activities

(53 542)

(279 586)

Cash flows from financing activities

Proceeds from borrowings

50

25 000

-

Payment of debt issuance costs

(638)

-

(Payments)/Proceeds from Euronext Oslo Børs

offering, net of offering cost

(10 674)

248 404

Proceeds from intercompany loans

52

44 913

70 715

Repurchases of equity securities

(6 927)

-

Proceeds from issuance of common shares

5 480

1 088

Cash generated from / (used in)

financing activities

57 154

320 207

Net increase in cash and cash

equivalents

(29 279)

29 789

Cash and cash equivalents at the

beginning of the period

31 522

1 733

Cash and cash equivalents at the end

of the period

2 243

31 522

Meltwater N.V. – Annual consolidated and company only financial statements 2021

169

Notes to the annual company only financial statements

38.

General information

38.1

Operations

Meltwater N.V. (the “Company”) has adopted IFRS (“International Financial Reporting Standards”)

as of 1 January 2020 and the financial statements presented are the first time application financials

in accordance with IFRS. The accounting policies applied by Meltwater N.V. also comply with the

statutory provisions of Part 9, Book 2 of the Dutch Civil Code.

The Company and its subsidiaries (the “Group” or “Meltwater”) is a group of companies founded in

Norway. The Company has its statutory seat in Amsterdam, The Netherlands. The Company is listed

on the Oslo Børs market in Oslo, Norway. The address of the Company’s registered office is Singel

250, 1016 AB, Amsterdam. The registration number of the Company at the Chamber of Commerce is

32109376.

On 3 December 2021 the general meeting of Meltwater B.V. approved the conversion of the Company

to a public limited company in the Netherlands (

naamloze vennootschap

) (N.V.). This conversion was

effected on 6 December 2021 through a change in the articles of association. Additionally the par

value of the shares was changed from USD 0.001 per share to EUR 0.01 per share resulting in an

increase in the paid share capital to EUR 15 million , the increase being funded from share premium.

As of 6 December 2021 the legal form changed from a B.V. to Meltwater N.V.

38.2

Significant accounting policies

The accounting policies for the Company’s financial statements are the same as for the consolidated

financial statements. Where no specific policies are mentioned, reference should therefore be made

to the accounting policies relating to the consolidated financial statements under note 3.

38.2.1

Investments in subsidiaries

Investments in subsidiaries are accounted for at cost as a result of applying IFRS 1 deemed cost

application at transition date to IFRS. Subsidiaries which have been acquired after IFRS adoption

date is accounted for using the cost method.

IFRS 1 optional exemption regarding investments in subsidiaries, joint ventures and associates has

been applied resulting in all subsidiaries being measured at cost in the separate financial statements.

Cost being determined as the carrying amount under the previous GAAP for all entities except the

Swiss entity where the fair value has been used as deemed cost of the subsidiary.

The Company periodically (at least once a year at year-end) evaluates the carrying value of assets

when events and circumstances indicate that the carrying value may not be recoverable. Factors

that the Company considers important, which could trigger an impairment review include, but are

not limited to, significant under-performance relative to expected historical or projected future

operating results, significant changes in the manner of use of the acquired assets or the strategy for

the Company’s overall business, significant negative industry or economic trends that are likely to

prevail into the long term. The carrying value of an asset is considered impaired when the recoverable

amount of such an asset is less than its carrying value and an impairment loss is recognized for the

amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable

amount is the higher of an asset’s fair value less costs of disposal and value in use.

An impairment loss is directly recognized in the profit and loss account while the carrying amount of

the asset concerned is concurrently reduced.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

170

39.

Financial assets-investments in subsidiaries

Please refer to the list of subsidiaries which has already been included in note 30 for subsidiaries

which are held by Meltwater N.V. For additions please refer to note 44 for disclosures regarding all

the business combinations of the Group.

Below is a summary of the movements in the Company’s investment in subsidiaries:

Subsidiaries

$’000

As at 1 January 2020

273 242

Movements during 2020

Additions

-

Capital contributions

5 415

As at 31 December 2020

278 657

Movements during 2021

Acquisitions

74 717

Capital contributions

59 818

As at 31 December 2021

413 192

40.

Intangible assets

Developed

Technology

$’000

As at 1 January 2020

Acquisition cost

4 809

Accumulated amortization and impairments

(3 784)

Net book amount

1 025

Movements for the year ended 31 December 2020

Additions

-

Amortization

(898)

As at 31 December 2020

Acquisition cost

4 809

Accumulated amortization and impairments

(4 682)

Net book amount

127

Movements for the year ended 31 December 2021

Amortization

(127)

As at 31 December 2021

Acquisition cost

4 809

Accumulated amortization and impairments

(4 809)

Net book amount

-

Meltwater N.V. – Annual consolidated and company only financial statements 2021

171

41.

Related party receivables

31 December

2021

$’000

31 December

2020

$’000

1 January 2020

$’000

Receivables from related parties

123

130

122

Loss allowance

(61)

(63)

(61)

62

67

61

The terms and conditions relating to the receivables from related parties are included in note 52.

The ECL method was applied to determine the loss allowance.

Movement in loss allowance:

2021

$’000

2020

$’000

As at 1 January

(63)

(61)

Provision for loss allowance

-

Write-off

-

Foreign exchange movement

2

(2)

As at 31 December

(61)

(63)

42.

Financial assets at fair value through profit and loss

The Group holds the following financial assets:

Financial assets measured

at fair value through profit

and loss

$’000

As at 1 January 2020

1 352

Additions

-

Other (exchange rate effects and other)

44

Disposals

-

As at 31 December

2020

1 396

Additions

-

Other (exchange rate effects and other)

(44)

Disposals

(60)

As at 31 December 2021

1 292

Non-Current

1 292

Current

-

Financial assets at fair value through profit and loss

The Financial assets at fair value through profit and loss are purchased equity investments in

privately held technology companies and limited partnerships. For these investments, the Company

does not have ability to exercise significant influence and control over the investees. Furthermore, the

fair value of these investees has not materially changed year on year.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

172

43.

Current and non-current liabilities

The Company holds the following financial liabilities:

Financial liabilities

measured at fair

value through profit

and loss

$’000

Amortized Cost

deferred purchase

consideration

$’000

Total

$’000

As at 1 January 2020

-

Additions

-

Other (exchange rate effects and

other)

-

Disposals

-

As at 31 December 2020

-

Additions

(13 140)

(3 151)

(16 291)

Other (exchange rate effects and

other)

-

Disposals

-

As at 31 December 2021

(13 140)

(3 151)

(16 291)

Non-Current

(10 245)

(1 439)

(11 684)

Current

(2 895)

(1 712)

(4 607)

Financial liabilities at fair value through profit and loss

The financial liabilities at fair value through profit and loss are contingent considerations included in

business combinations. Please refer to the business combinations note 36 in the consolidated

financial statements for more details on contingent considerations included in the total purchase

consideration of Klear.com. Ltd, Linkfluence SAS and Deepreason.ai Ltd.

Financial liabilities at amortized cost

The financial liabilities at amortized cost is deferred purchase considerations included in business

combinations. Please refer to the business combinations note 36 in the consolidated financial

statements for more details on deferred purchase consideration included in the total purchase

consideration of Klear.com. Ltd, Linkfluence SAS and Deepreason.ai Ltd.

44.

Business combinations

The Company acquired 3 entities during 2021, Klear.com. Ltd, Linkfluence SAS and Deepreason.ai Ltd.

The cost of which is recorded in Financial Assets - Investments in Subsidiaries. Refer to note 36 in the

consolidated financial statements for disclosures regarding business combinations and the related

purchase consideration.

45.

Other current assets

31

December

2021

$’000

31

December

2020

$’000

1

January

2020

$’000

Other current assets

719

1 029

150

719

1 029

150

Meltwater N.V. – Annual consolidated and company only financial statements 2021

173

46.

Other non-current assets

*Other non-current assets contains commitment fees relating to the undrawn revolving credit

facility.

47.

Cash and cash equivalents

48.

Share capital

Refer to note 13 in the consolidated financial statements for detail with regards to the share capital

of the Company.

31

December

2021

$’000

31

December

2020

$’000

1

January

2020

$’000

Other non-current assets*

1 160

-

1 160

-

31

December

2021

$’000

31

December

2020

$’000

1

January

2020

$’000

Cash at bank

2 243

31 522

1 733

Meltwater N.V. – Annual consolidated and company only financial statements 2021

174

49.

Company equity reconciliation to consolidated financials

Share capital

$’000

Share premium

$’000

Other reserves

$’000

Accumulated deficit

$’000

Total equity

$’000

Group equity as of 1 January 2020

24

105 179

(1 911)

(310 241)

(206 949)

Reconciling items Group to Company

Opening balance adjustments

Employee Benefit Obligations

-

108

121

229

Tax adjustments

-

2 047

Leases adjustments

-

(833)

Goodwill amortization

-

(4 235)

IFRS adoption adjustments

Remeasurement of investment in subsidiaries to cost

-

299 322

Employee payroll tax adjustment

-

(97)

IFRS transition adjustment

-

1 803

(4 261)

(2 458)

Company equity as of 1 January 2020

24

105 179

-

(18 177)

87 026

Group equity as of 31 December 2020

29

351 657

(100)

(386 295)

(34 709)

Reconciling items Group to Company

Opening balance adjustments

-

1 911

292 064

293 975

Consolidated movements

Employee benefit obligations

-

(60)

-

(60)

Cumulative translation adjustment

-

(1 751)

63

(1 688)

Shared based compensation tax adjustment

-

(1 681)

-

(1 681)

Loss for the period

-

75 991

Company only movements

Loss for the period

-

(21 831)

Cumulative translation adjustment

-

(60)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

175

Company equity as of 31 December 2020

29

349 976

-

(40 068)

309 937

Group equity as of 31 December 2021

3 421

417 255

(3 548)

(464 233)

(47 105)

Reconciling items Group to Company

Opening balance adjustments

-

(1 681)

100

346 227

344 646

Consolidated movements

Employee Benefit Obligations

-

(19)

-

(19)

Cumulative Translation Adjustment

-

3 467

-

3 467

IFRS tax adjustment

-

1 218

-

1 218

Loss for the period

-

77 938

Company only movements

Loss for the period

-

(18 943)

Cumulative Translation adjustment

-

(155)

-

61

(94)

Company equity as of 31 December 2021

3 421

416 637

-

(58 950)

361 108

Meltwater N.V. – Annual consolidated and company only financial statements 2021

176

50.

Borrowings

Non-convertible loans

$’000

Balance at 31 December 2020

-

Additions

25 000

Balance at 31 December 2021

25 000

Balance at 31 December 2021

25 000

of which (duration)

< 1 year

-

≥1 year ≤ 5 years

25 000

> 5 years

-

Repayment obligations falling due within 12 months from the end of the financial year, as set out

above, are included in current liabilities.

51.

Fair value measurement

IFRS 13 establishes a hierarchy that categorizes into three levels the inputs used to measure fair value

by giving the highest priority to quoted prices (unadjusted) in active markets for identical assets and

liabilities (level 1 inputs) and the lowest priority to unobservable inputs (level 3 inputs). In some cases,

the inputs used to measure the fair value of an asset or a liability might be categorized within different

levels of the fair value hierarchy. In those cases, the fair value measurement is categorized in its

entirety in the same level of the fair value hierarchy at the lowest level input that is significant to the

entire measurement. Levels used in the hierarchy are as follows:

Level 1:

The fair value of financial instruments traded in active markets (such as publicly traded

derivatives, and equity securities) is based on quoted market prices at the end of the reporting period.

The quoted market price used for financial assets held by the Group is the current bid price. These

instruments are included in level 1.

Level 2:

The fair value of financial instruments that are not traded in an active market (for example,

over-the-counter derivatives) is determined using valuation techniques which maximise the use of

observable market data and rely as little as possible on entity-specific estimates. If all significant

inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3:

If one or more of the significant inputs is not based on observable market data, the instrument

is included in level 3. This is the case for unlisted equity securities.

Financial instruments at amortized cost

The majority of the Company financial assets and liabilities are carried at amortized cost using the

effective interest method. The fair values of these instruments are not materially different from their

carrying values, since the instruments are either short-term in nature or the interest rates are on

market terms.

There were no transfers between fair value hierarchy levels in 2021 and 2020.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

177

31 December 2021

Financial assets

Notes

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Financial assets at fair

value through profit and

loss

-

1 292

Financial liabilities

Notes

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Contingent consideration-

Cash

-

(10 916)

Contingent consideration-

Equity

-

(2 223)

Applied the DCF method to determine fair values. Key assumptions are related to revenue growth.

31 December 2020

Financial assets

Notes

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Financial assets at fair

value through profit and

loss

-

1 396

1 January 2020

Financial assets

Notes

Level 1

$’000

Level 2

$’000

Level 3

$’000

Total

$’000

Financial assets at fair

value through profit and

loss

-

1 352

Fair value measurements using significant unobservable inputs (level 3)

Financial assets at

fair value through

profit and loss

Contingent

consideration-Equity

Contingent

consideration-Cash

Opening balance 1 January

2020

1 352

-

Additions

44

-

Closing balance 31 December

2020

1 396

-

Additions

(44)

(2 223)

(10 916)

Disposals

(60)

-

Closing balance 31 December

2021

1 292

(2 223)

(10 916)

Financial assets at fair value are measured at cost which approximates fair value as such no

disclosures will be included regarding the valuation technique utilised and the sensitivity analysis of

such valuation techniques.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

178

52.

Related parties

The related parties of the Company are entities and individuals capable of exercising control, joint

control or significant influence over the Company and companies belonging to Meltwater N.V. In

addition, members of the Board of Directors, executives with strategic responsibilities and their close

family members are also considered related parties. The Company carries out transactions with its

related parties on commercial terms that are normal in the respective markets, considering the

characteristics of the goods or services involved.

52.1

Transactions with subsidiaries

31 December 2021

$’000

31 December

2020

$’000

Support Recharge Income

29 874

25 516

Intercompany Interest Income

11 780

3 868

Support Recharge

(26 087)

(23 113)

IC Forex gain/loss

459

(345)

Intercompany Interest Expense

(11 408)

(16 555)

Total transactions with subsidiaries

4 618

(10 629)

52.2

Amounts due to/from intercompany parties

Funding is distributed within the Group to meet working capital needs of various entities within the

Meltwater Group. Meltwater N.V. provides a supporting letter to subsidiaries when required.

Intercompany funding will be repaid when the entity generates sufficient cash flow following

completion of its growth strategy. Intercompany funding is provided with the condition that the

amount is payable on demand to Meltwater N.V. if such request is made by Meltwater N.V. Funding

provided is expected to be received in full from the intercompany party without default.

Amounts due from group companies

31 December

2021

$’000

31 December 2020

$’000

Non-Current beginning balance

475 629

151 357

Foreign Currency revaluations

(1 424)

5 046

Intercompany loans

22 318

279 585

Intercompany charges

5 940

35 870

Intercompany interest

11 778

3 771

Non-Current ending balance

514 241

475 629

Amounts due to group companies

31 December 2021

$’000

31 December 2020

$’000

Current beginning balance

(467 628)

(341 545)

Foreign Currency Revaluations

7 907

(10 682)

Intercompany loans

(44 913)

(70 715)

Intercompany charges

(2 890)

(28 230)

Intercompany interest

(11 406)

(16 456)

Current ending balance

(518 930)

(467 628)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

179

53.

Income tax

Major components of income tax expense are as follows:

2021

$’000

2020

$’000

Current tax expense

Current year

-

(2)

Deferred tax expense

Recognition of previously unrecognized tax losses

-

Prior period true up

-

Total deferred tax expense/(benefit)

-

Income tax expense reported in the Statement of profit or loss

-

(2)

a.

Reconciliation of income tax expenses

2021

$’000

2020

$’000

Loss before tax

(18 943)

(21 829)

Federal tax at statutory rate (21%)

(3 978)

(4 584)

Unrecognized deferred tax assets

(758)

(873)

Unrecognized tax losses carried forward

4 736

5 455

Income tax expense at effective tax rate

-

(2)

Effective tax rate

0%

The US federal tax rate is used to reconcile to the effective tax rate as this is the Company’s highest

level of operational activity as well as being jurisdiction with the largest revenue generation. The

difference between the Company’s effective tax rate and the Netherlands statutory rate of 25% is

primarily due to net operating losses for which the related deferred tax assets have not been valued

due to uncertainty of realization thereof.

b.

Unrecognized deferred tax assets

Deferred tax assets have not been recognized in respect of the following items, as it is not probable

that future taxable profit will be available against which the Group can use the benefits there from:

Meltwater N.V. – Annual consolidated and company only financial statements 2021

180

31

December 2021

$’000

31

December 2020

$’000

Loss carried forward

23 491

18 036

Unrecognised losses utilised

-

Increase in unrecognized DTA due to operating losses

4 726

5 455

Unrecognized deferred tax assets

28 217

23 491

Expire

28 217

23 491

c.

Uncertain tax positions

Meltwater takes income tax positions that management believes are supportable and are intended

to withstand challenge by tax authorities. Some of these positions are inherently uncertain and

include the interpretation of income tax laws applied to complex transactions. The Company

periodically reassesses its tax positions. Changes to the financial statement recognition,

measurement, and disclosure of tax positions is based on management’s best judgment given any

changes in the facts, circumstances, information available and applicable tax laws. Considering all

available information, the Company believes that the ultimate resolution of such matters will not

have a material effect on the Company’s financial position, statements of operations or cash flows

Meltwater N.V. – Annual consolidated and company only financial statements 2021

181

54.

Share-based payments

Refer to note 16 in the consolidated financial statements for detail with regards to the share-based

payments.

55.

Trade and other payables

31 December 2021

31 December

2020

1 January 2020

Trade payables

1 169

79

5

Tax Payable

1 724

583

99

Accrued Bonus

350

-

210

Other accrued liabilities

8 337

10 200

35

11 580

10 862

349

56.

Personnel costs

2021

$’000

2020

$’000

Wages and salaries

350

1 992

Social charges

288

-

Pension costs

-

Acquisition related earn outs

1 917

-

2 555

1 992

The average number of employees of the Meltwater N.V. during the 2021 year, converted to full-time

equivalents was as follows: 1 962 of which 56 in the Netherlands (2020: 1 785 of which 50 in the

Netherlands).

The average headcount, representing full-time employees per department is presented below:

Employees by department

31 December 2021

31 December 2020

Cost of sales

Sales and marketing

55

50

General and administrative

1

-

Research and development

-

56

50

57.

Other income

The other income disclosed in the financial statements relate to Support recharge income between

various intercompany subsidiaries within the Group.

58.

Contingent asset

There are no contingent assets to disclose relating to the Meltwater Holding N.V.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

182

59.

Contingent liabilities

There are no contingent liabilities to disclose relating to the Meltwater Holding N.V.

60.

Financial risk management

This note explains the Group’s exposure to financial risks and how these risks could affect the

Company’s future financial performance.

Risk

Exposure arising from

Measurement

Management

Market risk –

foreign currency

exchange

Future commercial

transactions

Recognized financial assets

and liabilities not

denominated in US Dollar ($)

Sensitivity analysis

Cash

flow forecasting

Part of the daily

business management

Market risk –

interest rate

Non-current borrowings at

fixed and variable rates

Sensitivity analysis

Part of the daily

business management

Credit risk

Cash and cash equivalents,

deposits trade and other

receivables

Aging analysis

Credit ratings

Diversification of bank

accounts and the

placement of cash with

major financial

institutions

Ongoing credit

evaluation is performed

on the financial

condition of accounts

receivable

Part of the daily

business management

Liquidity risk

Lease liabilities, employee

benefit obligations and trade

and other payables

Maturity analysis

Availability of committed

credit lines and

borrowing facilities

Prudent cash

management policies

Susceptibility of the Group to financial risks is monitored as a part of its daily management of the

business. Exchange rate exposures are monitored by the Group’s Corporate Treasurer.

60.1

Market risk -

foreign currency exchange

The functional currency of the Company is the US Dollar ($). The Company faces currency risks

related to the transactions carried out in the currencies other than the functional currency. The

Company has not entered into transactions designed to hedge against the foreign currency risks.

There has been no change in the Company’s exposure to market risks or how these risks are managed

and measured.

The Company’s exposure to foreign currency risk at the end of the reporting period, expressed in US

Dollar currency units, was as follows:

Meltwater N.V. – Annual consolidated and company only financial statements 2021

183

31 December 2021

USD

EUR

GBP

SEK

NOK

CAD

CHF

Total

Receivables from

related parties

62

-

62

Amounts due from

group companies

452 478

22 916

38 847

514 241

Fair value assets

through profit & loss

1 292

-

1 292

Other non-current

assets

1 160

-

1 160

Cash and cash

equivalents

1 005

1 213

11

1

13

-

--

2 243

Amounts due to

group companies

(486 957)

(31 973)

-

(518 930)

Trade payable

(11 580)

-

(11 580)

Exposure

(42 540)

(30 760)

11

1

13

22 916

38 847

(11 512)

31 December 2020

USD

EUR

GBP

SEK

NOK

CAD

CHF

Total

Receivables from

related parties

67

-

67

Amounts due from

group companies

411 281

-

27 393

36 955

475 629

Fair value assets

through profit & loss

1 396

-

1 396

Other non-current

assets

-

Cash and cash

equivalents

3 268

4 217

11

3

24 023

-

31 522

Amounts due to

group companies

(438 399)

(29 229)

-

(467 628)

Trade payable

(10 862)

-

(10 862)

Exposure

(33 249)

(25 012)

11

3

24 023

27 393

36 955

30 124

Meltwater N.V. – Annual consolidated and company only financial statements 2021

184

1 January 2020

USD

EUR

GBP

SEK

NOK

CAD

CHF

Total

Receivables from

related parties

61

-

61

Amounts due from

group companies

97 192

-

28 037

26 128

151 357

Fair value assets

through profit & loss

1 352

-

1 352

Other non-current

assets

-

Cash and cash

equivalents

933

770

13

6

11

-

1 733

Amounts due to

group companies

(314 734)

(26 811)

-

(341 545)

Trade payable

(349)

-

(349)

Exposure

(215 545)

(26 041)

13

6

11

28 037

26 128

(187 391)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

185

60.2

Market risk - Foreign currency risk management

The Company undertakes transactions denominated in foreign currencies; consequently exposures

to exchange rate fluctuations arise.

Sensitivity analysis

The Company is exposed to a variety of foreign currencies (see table below).

A possible strengthening (weakening) of the foreign currencies by +/- 10.0% against the US Dollars

at 31 December would have affected the measurement of financial instruments denominated in a

foreign currency and affected equity and profit or loss by the amounts shown below, expressed in

US Dollar currency units. The analysis assumes that all other variables remain constant and ignores

any impact of forecast sales and purchases

Meltwater N.V. – Annual consolidated and company only financial statements 2021

186

31 December 2021

EUR

GBP

SEK

NOK

CAD

CHF

Total

Currency

strengthening by

10%

(3 076)

1

-

1

2 291

3 884

2 291

Currency weakening

by 10%

3 076

(1)

-

(1)

(2 291)

(3 884)

(2 291)

31 December 2020

EUR

GBP

SEK

NOK

CAD

CHF

Total

Currency

strengthening by

10%

(2 501)

1

-

240

2 739

3 695

4 174

Currency weakening

by 10%

2 501

(1)

-

(240)

(2 739)

(3 695)

(4 174)

1 January 2020

EUR

GBP

SEK

NOK

CAD

CHF

Total

Currency

strengthening by

10%

(2 604)

1

2 803

2 612

2 814

Currency weakening

by 10%

2 604

(1)

(2 803)

(2 612)

(2 814)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

187

60.3

Market risk-

interest rate risk management

The Company’s main interest rate risk arises from long-term borrowings with both fixed and

variable rates which expose the Group to cash flow interest rate risk. Meltwater does not

currently have an interest rate hedging policy as interest is paid when it becomes due. Long term

borrowings which contain a variable interest rate have been extinguished during December

2020. A rolling credit facility has been entered into for general corporate purpose use to secure

the availability of finance on pre-arranged terms over the facility period.

Sensitivity analysis

The following table illustrates the sensitivity of profit before tax and equity to a reasonably

possible change in interest rates of +/- 1.0% and how it would have affected equity and profit

or loss by the amounts shown below, expressed in US Dollar currency units. All other variables

are held constant.

Profit before tax

+1%

-1%

31 December 2021

-142

142

31 December 2020

-

60.4

Credit risk management

Credit risk arises from cash at bank and related party receivables and is considered to be

minimal.

Majority of the cash at bank are held with high credit quality financial institutions with a credit

rating of A or higher.

31

December 2021

$‘000

31

December 2020

$‘000

1

January

2020

$‘000

Cash at bank

2 243

31 522

1 733

60.5

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations

associated with its financial liabilities that are settled by delivering cash or another financial

asset. The Company’s approach to managing liquidity is to ensure as far as possible that it will

meet its liabilities when they are due under both normal and stressed conditions without

incurring unacceptable losses or risking damage to the Group’s reputation.

For detailed disclosure regarding the terms and conditions of external borrowings please refer

to note 1.1 and note 18 of the consolidated financial disclosures regarding impact of IBOR reform

and the external borrowings.

The liquidity risk management implies maintaining sufficient cash and committed credit facilities

by continuously monitoring forecast and actual cash flows and by matching the maturity

profiles of financial assets and liabilities.

The table below analyses the Company’s financial liabilities by their remaining period to

maturity based on the contractual maturity date. The amounts in the table are the contractual

undiscounted cash flows (these amounts may not reconcile to the amounts disclosed on the

statement of financial position for debt to shareholders, participants, related parties, lease

liabilities, trade and other payables).

Meltwater N.V. – Annual consolidated and company only financial statements 2021

188

Within the

next 12

months

$’000

Between 1

and 5 years

$’000

Beyond

5 years

$’000

Total

$’000

31 December 2021

Trade payables

11 580

-

11 580

Amounts due to group companies

518 930

-

518 930

External borrowings

-

25 000

-

25 000

Exposure

530 510

25 000

-

555 510

31 December 2020

Trade payables

10 862

-

10 862

Amounts due to group companies

467 628

-

467 628

External borrowings

-

478 490

-

478 490

1 January 2020

Trade payables

349

-

349

Amounts due to group companies

341 545

-

341 545

External borrowings

-

Exposure

341 894

-

341 894

60.6

Capital risk

The Company manages its capital to ensure that it will be able to continue as going concerns

while maximising the return to shareholders through the optimisation of the debt and equity

balance.

The capital structure of the Company consists of net debt (borrowings disclosed in notes 50

after deducting cash and bank balances) and equity of the Company (comprising issued

capital reserves retained earnings and accumulated deficit as disclosed in note 49 and the

statement of changes in Equity).

31

December 2021

$’000

31

December 2020

$’000

1

January 2020

$’000

Debt

(25 000)

-

Cash and cash equivalents

2 243

31 522

1 733

Net debt

(22 757)

31 522

1 733

Equity

361 108

309 939

87 026

Net debt to equity ratio

(0,06)

0,1

0,02

The ratio indicates what proportion of equity and debt the Company has been using to

finance its assets and how encumbered a company is with debt. Debt does not include trade

payables and net intercompany payables as they relate to operational activities and not

capital activities. The negative ratio as at 31 December 2021 indicates that the Group's cash at

hand does not exceeds its debt.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

189

61.

First time adoption of IFRS

These financial statements for the year ended 31 December 2021 are the first the Company has

prepared in accordance with IFRS-EU. For periods up to and including the year ended 31

December 2020 the Company prepared its financial statements in accordance with Dutch

GAAP.

Accordingly the Company has prepared financial statements that comply with IFRS applicable

as at 31 December 2021 together with the comparative period data for the year ended 31

December 2020 as described in the summary of significant accounting policies. In preparing the

financial statements the Company’s opening statement of financial position was prepared as

at 1 January 2020, the Company’s date of transition to IFRS. This note explains the principal

adjustments made by the Company in restating its Dutch GAAP financial statements including

the statement of financial position as at 1 January 2020 and the financial statements as of and

for the year ended 31 December 2020.

61.1

Mandatory exceptions and optional exemptions applied

IFRS 1 requires full retrospective application of IFRS for first-time adopters. It does however

provide some mandatory exceptions and optional exemptions from full retrospective

application. Adjustments as a result of the first-time adoption of IFRS are recognized through

accumulated deficit or other components of equity at the date of transition.

61.1.1

Accounting estimates

The estimates as of 1 January 2020 and 31 December 2020 are consistent with those made for

the same dates in accordance with Dutch GAAP (after adjustments to reflect any differences in

accounting policies). The estimates used by the Company to present these amounts in

accordance with IFRS reflect conditions as of 1 January 2020 and 31 December 2020.

61.1.2

Derecognition of financial assets and liabilities

At the date of transition to IFRS the Company applied the derecognition requirements in IFRS 9

prospectively for transactions occurring on or after the date of transition to IFRS. Financial

assets and liabilities derecognized under Dutch GAAP before the date of transition to IFRS are

therefore not recognized as financial assets and liabilities in accordance with IFRS.

61.1.3

Classification and measurement of financial assets

At the date of transition to IFRS the Company assessed whether their financial assets should be

measured at amortized cost, fair value through other comprehensive income or fair value

through profit or loss. The transition to IFRS did not alter the manner the financial assets account

balance was accounted for under Dutch GAAP.

61.1.4

Impairment of financial assets

At the date of transition to IFRS the Company assessed whether they needed to apply the

impairment requirements of IFRS 9 retrospectively. The transition to IFRS did not alter the

manner the financial assets account balance was accounted for under Dutch GAAP. The

Company therefore did not need to apply impairment requirements in section 5.5 of IFRS 9

retrospectively.

61.1.5

Share based payments

In accordance with IFRS 1:D2; first-time adopters are not required to apply IFRS 2 to equity-

settled share-based payments granted on or before 7 November 2002 and are not required to

apply IFRS 2 to share-based payments granted after 7 November 2002 that vested before the

date of transition to IFRS Standards. If a first-time adopter elects to apply IFRS 2 to such equity

instruments it may do so only if the entity has disclosed publicly the fair value of those equity

instruments determined at the measurement date as defined in IFRS 2.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

190

Meltwater have not previously disclosed publicly the fair value of the equity instruments

therefore the exemption is applicable.

61.1.6

Investments in subsidiaries, joint ventures and associates

When an entity prepares separate financial statements, IAS 27 requires it to account for its

investments in subsidiaries, joint ventures and associates either (IFRS 1:D14):

a) at cost;

b) in accordance with IFRS 9; or

c) using the equity method as described in IAS 28.

A first-time adopter can choose to measure its investments in subsidiaries, associates or joint

ventures at cost in its separate financial statements, for the purposes of its opening IFRS

statement of financial position. IFRS 1 requires that 'cost' to be either: (IFRS 1:D15)

- cost determined in accordance with IAS 27

- a deemed cost, determined as either fair value at the entity’s date of transition to IFRS

Standards for its separate financial statements; or the previous GAAP carrying amount at the

entity’s date of transition to IFRS Standards for its separate financial statements.

This election is available separately for each investment in a subsidiary, joint venture or

associate.

In accordance with IFRS 1 paragraph D15(b)(i), Meltwater has elected to account for its

investments in subsidiaries using the previous GAAP carrying amount at that date. One

exception relates to the Swiss entity for which Meltwater will apply IFRS 1.D15(b)(i) resulting in

the entity being measured at fair value as of the date of transition on a one-time basis. This only

relates to the standalone financial statements of the Dutch entity.

61.1.7

Borrowing costs

A first-time adopter can choose to apply the requirements of IAS 23 from date of transition, or

an earlier date as permitted by paragraph 28 of IAS 23. IAS 23:28, can only be applied when

application of this Standard constitutes a change in accounting policy. This is not the case for

Meltwater.

Meltwater will therefore be able to apply IAS 23 from the date of transition and not at an earlier

date.

61.1.8

Foreign currency transactions and advance consideration

A first-time adopter need not apply IFRIC 22 Foreign Currency Transactions and Advance

Consideration to assets, expenses and income in the scope of that Interpretation initially

recognized before the date of transition to IFRS Standards.

Meltwater will therefore apply IFRIC 22 from the date of transition.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

191

61.2

Reconciliation between Dutch GAAP and IFRS

61.2.1

Company reconciliation of equity as of 1 January 2020 date of transition to IFRS

Notes

Dutch GAAP

1 January 2020

$’000

Reclassification for

presentation purposes

$’000

Reclassified Dutch

GAAP

1 January 2020*

$’000

Remeasurements

$’000

IFRS

1 January 2020

$’000

Assets

Non-current assets

Intangibles assets

3 559

-

3 559

(2 534)

1 025

Financial assets – investments in

subsidiaries

22 542

-

22 542

250 700

273 242

Long-term investments

1 352

(1 352)

-

Amounts due from group companies

-

151 357

-

151 357

Financial assets at fair value through

profit and loss

-

1 352

-

1 352

27 453

151 357

178 810

248 166

426 976

Current assets

Amounts due from group companies

151 357

(151 357)

-

Related party receivables

61

-

61

-

61

Other current assets

123

-

123

27

150

Cash and cash equivalents

1 760

-

1 760

(27)

1 733

153 301

(151 357)

1 944

-

1 944

Total assets

180 754

248 166

428 920

Liabilities

Non-current liabilities

Amounts due to group companies

62 165

(62 165)

-

62 165

(62 165)

-

Provisions

Provisions subsidiaries

48 622

(48 622)

-

Meltwater N.V. – Annual consolidated and company only financial statements 2021

192

Notes

Dutch GAAP

1 January 2020

$’000

Reclassification for

presentation purposes

$’000

Reclassified Dutch

GAAP

1 January 2020*

$’000

Remeasurements

$’000

IFRS

1 January 2020

$’000

Current liabilities

Amounts due to group companies

278 235

62 165

340 400

1 145

341 545

Other current liabilities/ Trade and other

payables

1 473

-

1 473

(1 124)

349

Total current liabilities

279 708

62 165

341 873

21

341 894

Total liabilities

390 495

-

390 495

(48 601)

341 894

Equity

Share capital

24

-

24

Share premium

103 360

1 819

105 179

Reserve for translation differences

(1 803)

1 803

-

Other reserves (deficit)

(253 502)

253 502

-

Accumulated deficit

-

(313 125)

294 948

(18 177)

Result for the year

(57 820)

57 820

-

(209 741)

-

(209 741)

296 767

87 026

Total equity and liabilities

180 754

-

180 754

248 166

428 920

*The presentation of the financial statements changed due to adoption of IFRS on 1 January 2020. The figures included in this column relates

to the Dutch GAAP financials statement figures presented on the new presentation according to IFRS.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

193

61.2.2

Company reconciliation of equity as of 31 December 2020

Notes

Dutch GAAP

31 December 2020

$’000

Reclassification for

presentation purposes

$’000

Reclassified Dutch

GAAP

31 December 2020*

$’000

Remeasurements

$’000

IFRS

31 December 2020

$’000

Assets

Non-current assets

Intangibles assets

3 019

-

3 019

(2 892)

127

Financial assets –investments in

subsidiaries

36 500

-

36 500

242 157

278 657

Amounts due from group companies

-

472 255

3 374

475 629

Long-term investments

1 396

(1 396)

-

Financial assets at fair value through

profit and loss

-

1 396

-

1 396

40 915

472 255

513 170

242 639

755 809

Current assets

Amounts due from group companies

472 255

(472 255)

-

Related party receivables

67

-

67

-

67

Other current assets

1 029

-

1 029

-

1 029

Cash and cash equivalents

31 522

-

31 522

-

31 522

504 873

(472 255)

32 618

-

32 618

Total assets

545 788

-

545 788

242 639

788 427

Liabilities

Non-current liabilities

Amounts due to group companies

79 999

(79 999)

-

79 999

(79 999)

-

Provisions

Provisions subsidiaries

110 698

-

110 698

(110 698)

-

Current liabilities

Amounts due to group companies

380 720

79 999

460 719

6 909

467 628

Meltwater N.V. – Annual consolidated and company only financial statements 2021

194

Notes

Dutch GAAP

31 December 2020

$’000

Reclassification for

presentation purposes

$’000

Reclassified Dutch

GAAP

31 December 2020*

$’000

Remeasurements

$’000

IFRS

31 December 2020

$’000

Trade and other payables

10 384

-

10 384

478

10 862

391 104

79 999

471 103

7 387

478 490

Total liabilities

581 801

-

581 801

(103 311)

478 490

Equity

Share capital

29

-

29

-

29

Share premium

347 313

-

347 313

2 663

349 976

Reserve for translation differences

(45)

45

-

Other reserves (deficit)

(311 382)

311 382

-

Accumulated deficit

(311 427)

293 190

(18 237)

Result for the year

(71 928)

-

(71 928)

50 097

(21 831)

(36 013)

-

(36 013)

345 950

309 937

Total equity and liabilities

545 788

-

545 788

242 639

788 427

*The presentation of the financial statements changed due to adoption of IFRS on 1 January 2020. The figures included in this column relates

to the Dutch GAAP financials statement figures presented on the new presentation according to IFRS.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

195

61.2.3

Company reconciliation of profit and loss and other comprehensive income for the year ended 31 December 2020

Notes

Dutch GAAP

31 December 2020

$’000

Reclassification for

presentation

purposes

$’000

Reclassified Dutch

GAAP

31 December 2020*

$’000

Remeasurement

$’000

IFRS

31 December

2020

$’000

Other income and expense after taxation

(22 052)

22 052

-

Share in result of participations after

taxation

(49 876)

49 876

-

Result for the year

(71 928)

71 928

-

Sales and marketing expenses

-

(3 476)

1 969

(1 507)

General and administrative expenses

-

(29 400)

715

(28 685)

Research and development expenses

(1 480)

1 404

(76)

Other income

-

25 516

-

25 516

Operating profit/(loss)

-

(8 840)

4 088

(4 752)

Finance cost

-

(12 574)

(3 981)

(16 555)

Loss on extinguishment of debt/loan

-

Foreign exchange gain/(loss)

-

(3 814)

(358)

(4 172)

Finance income

-

276

3 374

3 650

Profit / (loss) before tax

-

(24 952)

3 123

(21 829)

Income tax expense

-

2 900

(2 902)

(2)

Other income and expense after taxation

Share of result in participations after tax

(49 876)

49 876

-

Profit / (loss) for the year

-

(71 928)

50 097

(21 831)

Meltwater N.V. – Annual consolidated and company only financial statements 2021

196

61.3

Notes to the reconciliation of equity as of 1 January 2020, 31 December 2020 profit and loss

and other comprehensive income for the year ended 31 December 2020

61.3.1

Reclassification for presentation purposes

The presentation of the financial statements changed due to adoption of IFRS on 1 January

2020.

The change in presentation resulted in reclassification from Dutch GAAP financial statements to

IFRS company financial statements.

Long term investments

Long term investments previously disclosed in the Dutch GAAP financials were reclassified to

display other non-current assets and financial assets at fair value through profit and loss as

separate line items on the face of the IFRS financial statements.

Current and non-current classification

A reclassification has occurred between current and non-current intercompany balances

previously disclosed as a reassessment of the balances indicated that intercompany assets

should be classified as non-current and intercompany liabilities should be classified as current.

Expenses

In the previous Dutch GAAP financial statements the exemption to disclose a detailed P&L was

applied. Whereas for the IFRS financial statements management made a decision to present

expenses by function of profit and loss as this is a more fair presentation.

Accumulated deficit

The reserve for translation differences and Other reserves (deficit) were reclassified to

Accumulated deficit to conform to IFRS presentation.

61.3.2

Remeasurement upon transition to IFRS

Upon adoption of IFRS the following adjustments were made to the financial statements.

Investments in subsidiaries ,goodwill and provision of subsidiaries

The accounting policy which was applied under the previous GAAP for the recognition and

measurement of investments in subsidiaries was the net asset value method. The carrying

amount under the previous GAAP has been adopted as the cost of the investment with a single

entity (Switzerland Holding) being revalued to $250.7 million with the determined fair value as

at 1 January 2020 being adopted as the cost of the investment. The fair value was determined

using the DCF method. Key assumptions are related to revenue growth and the discount rate.

As cost has been adopted goodwill of $2.5 million has been removed from the financial

statements as the net asset value method is not applied. Due to the adoption of the deemed cost

under IFRS 1 subsidiaries with a negative carrying amount of $48.6 million has been remeasured

to a cost of zero resulting in the provision of subsidiaries being consequently removed.

Income tax expense and balances

Tax liabilities have been calculated in accordance with IFRS consequently leading to tax

balances being remeasured with corresponding effects on the income tax expense.

Share based payment expense

Share based payment expense has previously been recognized as an expense, IFRS specifically

addresses share based payment expense within a group context. When subsidiaries receive the

goods or services and does not have any obligation to settle the transaction it considered that

Meltwater N.V. – Annual consolidated and company only financial statements 2021

197

issuing entity is making capital contributions by taking on the cost of remunerating the

subsidiary’s employees. Consequently $5.4 million share based payment expense relating to

goods or services received by the subsidiaries has been capitalized to the cost of the investment

increasing the cost in subsidiaries value from $273 million to $278 million for the 2020 financial

period. Share based payment expenses also has a slightly different measurement basis under

IFRS when compared to the previous GAAP resulting in a remeasurement of the share based

payment expense in accordance with the requirements under IFRS which resulted in an impact

in the share premium and investment in subsidiaries accounts of $1.8 million for the 1 January

2020 opening balance, and $2.6 million for the period ended 31 December 2020.

Finance cost and finance income

Finance cost and finance income have been remeasured to correct the previously under accrued

interest expense and interest income under the previous GAAP resulting in adjustments of $4.0

and $3.4 million respectively.

62.

Subsequent events

Please refer note 37 in the consolidated financial statements for related disclosures.

Jørn Lyseggen

Executive Chair

David Faugno

Senior non-executive director

Mattias Erik Holmström

Non-executive director

Sang Kim

Non-executive director

Erik Langaker

Non-executive director

Stefanie Witte

Non-executive director

26 April 2022

Amsterdam, the Netherlands

Meltwater N.V. – Annual consolidated and company only financial statements 2021

198

Other information

Profit appropriation according to the Articles of Associations

According to article 15 of the Deed of Amendment to the Articles of Association the annual net

profit is at free disposal of the annual shareholders meeting.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

199

Independent Auditor's report

2021

Meltwater N.V. – Annual consolidated and company only financial statements 2021

200

Independent auditor’s report

Amsterdam

25 April 2022

To: the general meeting of Meltwater N.V.

Report on the financial statements 2021

Our opinion

In our opinion, the financial statements of Meltwater N.V. (‘the Company’) give a true and fair

view of the financial position of the Company and the Group (the company together with its

subsidiaries) as at 31 December 2021, and of its result and its cash flows for the year then

ended in accordance with International Financial Reporting Standards as adopted by the

European Union (‘EU-IFRS’) and with Part 9 of Book 2 of the Dutch Civil Code.

What we have audited

We have audited the accompanying financial statements 2021 of Meltwater N.V., Amsterdam.

The financial statements comprise the annual consolidated financial statements of the Group

and the company only financial statements.

The financial statements comprise:

● the consolidated and company only statement of financial position as at

31 December 2021;

● the following statements for 2021: the consolidated and company only profit or loss

account, the consolidated and company only statements of other comprehensive

income, the consolidated and company only statements of changes in equity and cash

flows; and

● the notes to the consolidated and company only financial statements, comprising a

summary of the significant accounting policies and other explanatory information.

The financial reporting framework applied in the preparation of the financial statements is EU-

IFRS and the relevant provisions of Part 9 of Book 2 of the Dutch Civil Code.

The basis for our opinion

We conducted our audit in accordance with Dutch law, including the Dutch Standards on

Auditing. We have further described our responsibilities under those standards in the section

‘Our responsibilities for the audit of the financial statements’ of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a

basis for our opinion.

Independence

We are independent of Meltwater N.V. in accordance with the European Union Regulation on

specific requirements regarding statutory audit of public-interest entities, the ‘Wet toezicht

accountantsorganisaties’ (Wta, Audit firms supervision act), the ‘Verordening inzake de

onafhankelijkheid van accountants bij assuranceopdrachten’ (ViO, Code of Ethics for

Professional Accountants, a regulation with respect to independence) and other relevant

independence regulations in the Netherlands. Furthermore, we have complied with the

‘Verordening gedrags- en beroepsregels accountants’ (VGBA, Dutch Code of Ethics).

Our audit approach

We designed our audit procedures with respect to the key audit matters, fraud and going

concern, and the matters resulting from that, in the context of our audit of the financial

Meltwater N.V. – Annual consolidated and company only financial statements 2021

201

statements as a whole and in forming our opinion thereon. The information in support of our

opinion, like our findings and observations related to individual key audit matters, our audit

approach on fraud risk and our audit approach on going concern was addressed in this

context and we do not provide a separate opinion or conclusion on these matters.

Overview and context

Meltwater N.V. is a Software as a Service (‘SaaS’) provider of cloud-based news, social media

monitoring solutions and related services. The Company hosts software solutions that makes it

available to its customers through subscriptions. The Group consists of several components

and therefore we considered our group audit scope and approach as set out in the section

‘The scope of our group audit’.

As part of designing our audit, we determined materiality and assessed the risks of material

misstatement in the financial statements. In particular, we considered where the board of

directors made important judgements, for example, in respect of significant accounting

estimates that involved making assumptions and considering future events that are inherently

uncertain. We considered the audit of revenue and the audit of acquisitions of businesses as

key audit matters, in view of the significant estimation uncertainty, magnitude and the related

higher inherent risk of material misstatement. Each of these key audit matters have been set

out in the section ‘Key audit matters’ of this report.

Other areas of focus that were not considered as key audit matters were the tax position, the

impact of COVID-19 on the business (including government support), and the adoption of IFRS

for the company only financial statements. COVID-19 had no significant adverse impact on the

financial performance and the going concern assumption of the Company. In conjunction with

the adoption of IFRS for the company only financial statements, we paid specific attention to

the remeasurement of the valuation of the Swiss subsidiary (Meltwater news International

Holdings GmbH).

We ensured that the audit teams at both group and component level included the appropriate

skills and competences which are needed for the audit of a SaaS company that is operating in

an international environment. We therefore included experts and specialists in the areas of IT,

valuations, share based payments and tax in our team.

The outline of our audit approach was as follows:

Materiality

● Overall materiality: US$3 million.

Audit scope

● We conducted audit work at three locations. We paid

particular attention to the head office in San Francisco (USA),

the shared service centre located in Switzerland and to the

Netherlands, where the Company has its statutory seat.

● A site visit was conducted to the shared service centre

location in Switzerland.

● Audit coverage: 100% of consolidated revenue, 96% of

consolidated total assets and 100% of profit before taxes.

Key audit matters

● Audit of revenue

● Audit of the acquisition of businesses

Meltwater N.V. – Annual consolidated and company only financial statements 2021

202

Materiality

The scope of our audit was influenced by the application of materiality, which is further

explained in the section ‘Our responsibilities for the audit of the financial statements’.

Based on our professional judgement we determined certain quantitative thresholds for

materiality, including the overall materiality for the financial statements as a whole as set out

in the table below. These, together with qualitative considerations, helped us to determine the

nature, timing and extent of our audit procedures on the individual financial statement line

items and disclosures and to evaluate the effect of identified misstatements, both individually

and in aggregate, on the financial statements as a whole and on our opinion.

Overall group

materiality

US$3 million (2020: US$2.7 million).

Basis for determining

materiality

We used our professional judgement to determine overall materiality. As

a basis for our judgement we used 0.75% of total revenues.

Rationale for

benchmark applied

We used total revenues as the primary benchmark, a generally accepted

auditing practice, based on our analysis of the common information

needs of users of the financial statements. The company focuses on

revenue growth to achieve geographic and technological scale. On this

basis, we believe that the total revenues is an important metric for the

financial performance of the Company.

Component

materiality

To each component in our audit scope, we, based on our judgement,

allocate materiality that is less than our overall group materiality. The

range of materiality allocated across components was between US $2,79

million and US$560,000.

We also take misstatements and/or possible misstatements into account that, in our

judgement, are material for qualitative reasons.

We agreed with the board of directors that we would report to them any misstatement

identified during our audit above US$300,000 (2020: US$270,000) as well as misstatements

below that amount that, in our view, warranted reporting for qualitative reasons.

The scope of our group audit

Meltwater N.V. is the parent company of a group of entities. The financial information of this

group is included in the consolidated financial statements of Meltwater N.V.

We tailored the scope of our audit to ensure that we, in aggregate, provide sufficient coverage

of the financial statements for us to be able to give an opinion on the financial statements as a

whole, taking into account the management structure of the Group, the nature of operations

of its components, the accounting processes and controls, and the markets in which the

components of the Group operate. In establishing the overall group audit strategy and plan,

we determined the type of work required to be performed at component level by the group

engagement team and by each component auditor.

The group audit primarily focussed on Meltwater N.V. and the US activities which are

financially significant and consist of the following components: Meltwater US Holdings Inc.,

Meltwater News US Inc., and Meltwater News US1 Inc. These components were subject to audits

of their complete financial information. Four other components, outside the US, which were not

financially significant were also subject to audits of their complete financial information to

achieve appropriate coverage.

We scoped-in additional components for audit procedures to achieve appropriate coverage on

financial line items in the consolidated financial statements.

In total, in performing these procedures, we achieved the following coverage on the financial

line items:

Meltwater N.V. – Annual consolidated and company only financial statements 2021

203

Revenue

100%

Total assets

96%

Profit before tax

100%

The audit of revenue was performed centrally by the group engagement team. For other

components subject to audits of their complete financial information we used a component

auditor who are familiar with the local laws and regulations to perform the audit work.

The group engagement team performed the audit work on the group consolidation, financial

statement disclosures and a number of complex items such as valuation of intangible assets,

income tax and stock options at the head office.

Where component auditors performed the work, we determined the level of involvement we

needed to have in their work to be able to conclude whether we had obtained sufficient and

appropriate audit evidence as a basis for our opinion on the consolidated financial statements

as a whole.

We issued instructions to the US engagement team and the component auditor of the shared

service centre in Switzerland. These instructions included amongst others our risk analysis,

materiality and scope of the work. We explained to the component audit team the structure of

the group, the main developments that are relevant for the component auditor, the risks

identified, the materiality levels to be applied and our global audit approach. We had various

calls with the in-scope component audit team during the year and upon conclusion of their

work. During these calls, we discussed the significant accounting and audit issues identified

by the component auditor, their reports, the findings of their procedures and other matters,

which could be of relevance for the consolidated financial statements.

For the remaining components we performed, among other things, analytical procedures to

corroborate our assessment that there were no significant risks of material misstatements

within those components.

By performing the procedures above at components, combined with additional procedures at

group level, we have been able to obtain sufficient and appropriate audit evidence on the

group’s financial information, as a whole, to provide a basis for our opinion on the financial

statements.

Audit approach fraud risks

We identified and assessed the risks of material misstatements of the financial statements due

to fraud. During our audit we obtained an understanding of the entity and its environment and

the components of the internal control system. This included management’s risk assessment

process, management’s process for responding to the risks of fraud and monitoring the

internal control system.

We evaluated the design and relevant aspects of the internal control system and in particular

the controls addressing fraud risk, as well as activities surrounding journal entries and relating

to the reconciliation of detailed records to the general ledger for material account balances.

We evaluated the design and the implementation and, where considered appropriate.

We asked members of the board of directors whether they are aware of any actual or

suspected fraud. This did not result in signals of actual or suspected fraud that may lead to a

material misstatement.

As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect to

financial reporting on fraud, misappropriation of assets and bribery and corruption. We

evaluated whether these factors indicate that a risk of material misstatement due to fraud is

present.

We incorporated an element of unpredictability in our audit. We reviewed minutes of the

Board of Directors and subcommittees thereof and performed fraud inquiries with

Meltwater N.V. – Annual consolidated and company only financial statements 2021

204

management. During the audit we remained alert to indications of fraud. We also considered

the outcome of our other audit procedures and evaluated whether any findings were indicative

of fraud or non-compliance of laws and regulations. Whenever we identified any indications of

fraud, we re-evaluated our fraud risk assessment and its impact on our audit procedures.

We identified the following fraud risk and performed the following specific procedures:

Identified fraud risk

Our audit work and observations

Risk of fraud through management

override of controls

As in all of our audits, we address the risk

of management override of controls. This

includes evaluating whether there is

evidence of bias by management that

may represent a risk of material

misstatement due to fraud.

In this context, we paid particular

attention to the significant estimates and

judgments made by management.

Management may perceive pressure to

manipulate accounting estimates that

require significant judgement in order to

improve results. Additionally,

inappropriate accounting policies and

treatments may be adopted to achieve

the desired outcomes.

Where relevant to our audit, we have evaluated the

design of the internal control measures that are

intended to mitigate the risk of management override

of controls and assessed the effectiveness of those

measures in the processes of generating and

processing journal entries and forming estimates.

We selected journal entries on the basis of risk criteria

and performed specific audit procedures on them. We

assessed significant judgments made by

management, unusual transactions, related party

transactions. We assessed the appropriateness and

accurate application of accounting policies in

accordance with EU-IFRS.

We did not identify any specific indications of fraud

or suspicion of fraud in respect of management

override of controls.

Audit approach going concern

As disclosed in section 1.2 Going concern of the financial statements management performed

their assessment of the entity’s ability to continue as a going concern for at least 12 months

from the date of preparation of the financial statements and has not identified events or

conditions that may cast significant doubt on the entity’s ability to continue as a going

concern (hereafter: going concern risks). Our procedures to evaluate management’s going

concern assessment included, amongst others:

● considering whether management’s going concern assessment includes all relevant

information of which we are aware as a result of our audit by inquiring with

management regarding management's most important assumptions underlying their

going concern assessment and considering whether management identified events or

conditions that may cast significant doubt on the Company’s ability to continue as a

going concern;

● evaluating management’s current budget including cash flows for at least 12 months

from the date of preparation of the financial statements taken into account current

developments and all relevant information of which we are aware as a result of our

audit;

● analysing whether the current and the required financing has been secured to enable

the continuation of the entirety of the entity's operations, including compliance with

relevant covenants;

● performing inquiries of management as to their knowledge of going concern risks

beyond the period of management’s assessment.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

205

We concluded that management’s use of the going concern basis of accounting is

appropriate, and based on the audit evidence obtained, that no material uncertainty exists

related to events or conditions that may cast significant doubt on the entity’s ability to

continue as a going concern.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most

significance in the audit of the financial statements. We have communicated the key audit

matters to the board of directors. The key audit matters are not a comprehensive reflection of

all matters identified by our audit and that we discussed. In this section, we described the key

audit matters and included a summary of the audit procedures we performed on those

matters.

Key audit matter

Our audit work and observations

Audit of revenue

(Note 22)

As of 31 December 2021, the Group recognized

US$402 million of revenue.

The Company derives its revenue primarily

from subscription fees for its cloud-based

news and social media monitoring services.

The Company hosts software applications

that it makes available to its customers over

subscription periods generally up to 12 months

or they may extend to longer periods. The

Company provides customers with access to

training and support that help them use the

cloud-based news and social media

monitoring services over the subscription

periods

.

The subscription term runs for an agreed-upon

period based on a signed contract. Revenue

recognition is typically systematically

calculated on a straight-line basis with the

exception of revenue recognized upfront and

net of fees from sales of third-party vendors’

products when Meltwater N.V. is acting as an

agent.

Revenue is assessed as an important metric

for the performance of the company. Given

the higher inherent risk of material

misstatement, as a result of the large number

of transactions and counterparties we have

spent a significant amount of time on the audit

of revenue.

We therefore considered the audit of revenue

as a key audit matter.

We obtained an understanding of the revenue

recognition process and evaluated the design

and implementation of internal controls over

the revenue process. The audit of revenue was

substantive in nature.

We reconciled the revenue detailed listings to

the Company’s general ledger, and

independently recalculated revenue and

deferred revenue based on inputs (i.e.

contract start date and end date, subsidiary,

contract value) that are agreed to the signed

contracts, invoices and sales orders on a

sample basis.

We performed confirmation procedures with

customers for outstanding accounts

receivable balances, assessed the

reasonableness of management’s estimation

and classification process to reserve against

uncollectible balances.

We also performed cut-off procedures over

both billed and unbilled amounts before and

after the balance sheet date to ensure revenue

is recognized in the right period.

We reviewed credit memos and corresponding

approvals, to ensure that the adjustment of

previously recognized revenue is appropriate.

We assessed the presentation of the revenue

on a gross versus net basis, based on the term

of the selected contracts and challenged

management on the classification of revenue.

Our procedures did not result in material

findings with respect to the revenue.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

206

Key audit matter

Our audit work and observations

Acquisitions of business

(Note 36)

As included in note 36 of the consolidated

financial statements, during the year ended 31

December 2021, the Company completed the

acquisition of four businesses, for total

consideration of $93.7 million. In accounting

for the acquisitions, the Company recorded

$30.9 million of Intangible Assets and $64.5

million Goodwill.

Determining the fair value assigned to

acquired intangible assets and to contingent

consideration requires management to use

significant judgement and estimates.

Management has involved valuation

specialists to assist them in making such

judgements and estimates.

We have applied a high degree of auditor

judgement, subjectivity and effort in

performing procedures and evaluating

management’s significant assumptions, and

we have spent a significant amount of time in

the audit effort, including the use of

professionals with specialized skill and

knowledge. We therefore considered the audit

of the acquisitions of businesses as a key

audit matter.

We addressed the matter by performing audit

procedures including, among others: (i)

reading the purchase agreement; (ii) testing

management’s process for determining the

fair value of the customer relationships,

developed technologies and trademarks; (iii)

evaluating the appropriateness of the

valuation methods used; (iv) testing the

completeness and accuracy of the underlying

data used in the valuation methods; and (v)

evaluating the reasonableness of the

significant assumptions used by management

related to revenue, cost of revenue and

operating expenses attributable to the asset,

retention rate, contributory asset charges,

and the discount rate.

Evaluating management’s significant

assumptions involved considering (i) the

current and past performance of the acquired

businesses; (ii) consistency with external

market and industry data; and (iii) whether

these significant assumptions were consistent

with evidence obtained in other areas of the

audit. Professionals with specialized skill and

knowledge were used to assist in evaluating (i)

the appropriateness of the Company’s

valuation methods and (ii) the reasonableness

of certain significant assumptions.

Our procedures did not result in material

findings with respect to the acquisitions of

business.

Report on the other information included in the annual report

The annual report contains other information. This includes all information in the annual report

in addition to the financial statements and our auditor’s report thereon.

Based on the procedures performed as set out below, we conclude that the other information:

● is consistent with the financial statements and does not contain material misstatements;

● contains all the information regarding the directors’ report and the other information

that is required by Part 9 of Book 2 and regarding the remuneration report required by

the sections 2:135b and 2:145 subsection 2 of the Dutch Civil Code.

We have read the other information. Based on our knowledge and the understanding obtained

in our audit of the financial statements or otherwise, we have considered whether the other

information contains material misstatements.

By performing our procedures, we comply with the requirements of Part 9 of Book 2 and

section 2:135b subsection 7 of the Dutch Civil Code and the Dutch Standard 720. The scope of

Meltwater N.V. – Annual consolidated and company only financial statements 2021

207

such procedures was substantially less than the scope of those procedures performed in our

audit of the financial statements.

The board of directors is responsible for the preparation of the other information, including the

directors’ report and the other information in accordance with Part 9 of Book 2 of the Dutch

Civil Code. The board of directors are responsible for ensuring that the remuneration report is

drawn up and published in accordance with sections 2:135b and 2:145 subsection 2 of the

Dutch Civil Code.

Report on other legal and regulatory requirements and ESEF

Our appointment

We were appointed as auditors of Meltwater N.V.. This followed the passing of a resolution by

the shareholders at the annual general meeting held on 30 June 2021. Our appointment has

been renewed annually and now represents a total period of uninterrupted engagement of

twelve years of which one year since the listing at Oslo Børs Euronext.

European Single Electronic Format (ESEF)

Meltwater N.V. has prepared the annual report, including the financial statements, in ESEF. The

requirements for this format are set out in the Commission Delegated Regulation (EU) 2019/815

with regard to regulatory technical standards on the specification of a single electronic

reporting format (these requirements are hereinafter referred to as: the RTS on ESEF).

In our opinion, the annual report prepared in XHTML format, including the partially marked-up

consolidated financial statements, as included in the reporting package by Meltwater N.V.,

complies, in all material respects, with the RTS on ESEF.

The board of directors is responsible for preparing the annual report, including the financial

statements, in accordance with the RTS on ESEF, whereby the board of directors combines the

various components into a single reporting package. Our responsibility is to obtain reasonable

assurance for our opinion on whether the annual report in this reporting package complies

with the RTS on ESEF.

Our procedures, taking into account Alert 43 of the NBA (Royal Netherlands Institute of

Chartered Accountants), included amongst others:

● Obtaining an understanding of the entity’s financial reporting process, including the

preparation of the reporting package.

● Obtaining the reporting package and performing validations to determine whether the

reporting package, containing the Inline XBRL instance document and the XBRL

extension taxonomy files, has been prepared, in all material respects, in accordance

with the technical specifications as included in the RTS on ESEF.

● Examining the information related to the consolidated financial statements in the

reporting package to determine whether all required mark-ups have been applied and

whether these are in accordance with the RTS on ESEF.

No prohibited non-audit services

To the best of our knowledge and belief, we have not provided prohibited non-audit services as

referred to in article 5(1) of the European Regulation on specific requirements regarding

statutory audit of public-interest entities.

Services rendered

The services, in addition to the audit, that we have provided to the Company or its controlled

entities, for the period to which our statutory audit relates, are disclosed in note 24 to the

financial statements.

Meltwater N.V. – Annual consolidated and company only financial statements 2021

208

Responsibilities for the financial statements and the audit

Responsibilities of the board of directors

The board of directors is responsible for:

● the preparation and fair presentation of the financial statements in accordance with EU-

IFRS and Part 9 of Book 2 of the Dutch Civil Code; and for

● such internal control as the board of directors determines is necessary to enable the

preparation of the financial statements that are free from material misstatement,

whether due to fraud or error.

As part of the preparation of the financial statements, the board of directors is responsible for

assessing the Company’s ability to continue as a going-concern. Based on the financial

reporting frameworks mentioned, the board of directors should prepare the financial

statements using the going-concern basis of accounting unless the board of directors either

intends to liquidate the Company or to cease operations or has no realistic alternative but to

do so. The board of directors should disclose in the financial statements any event and

circumstances that may cast significant doubt on the Company’s ability to continue as a

going concern.

Our responsibilities for the audit of the financial statements

Our responsibility is to plan and perform an audit engagement in a manner that allows us to

obtain sufficient and appropriate audit evidence to provide a basis for our opinion. Our

objectives are to obtain reasonable assurance about whether the financial statements as a

whole are free from material misstatement, whether due to fraud or error and to issue an

auditor’s report that includes our opinion. Reasonable assurance is a high but not absolute

level of assurance, which makes it possible that we may not detect all material misstatements.

Misstatements may arise due to fraud or error. They are considered material if, individually or

in the aggregate, they could reasonably be expected to influence the economic decisions of

users taken on the basis of the financial statements.

Materiality affects the nature, timing and extent of our audit procedures and the evaluation of

the effect of identified misstatements on our opinion.

A more detailed description of our responsibilities is set out in the appendix to our report.

Amsterdam, 29 April 2022

PricewaterhouseCoopers Accountants N.V.

/PwC_Partner_Signature/

Original has been signed by B.A.A. Verhoeven RA

Meltwater N.V. – Annual consolidated and company only financial statements 2021

209

Appendix to our auditor’s report on the financial statements 2021 of Meltwater N.V.

In addition to what is included in our auditor’s report, we have further set out in this appendix

our responsibilities for the audit of the financial statements and explained what an audit

involves.

The auditor’s responsibilities for the audit of the financial statements

We have exercised professional judgement and have maintained professional scepticism

throughout the audit in accordance with Dutch Standards on Auditing, ethical requirements

and independence requirements. Our audit consisted, among other things of the following:

● Identifying and assessing the risks of material misstatement of the financial statements,

whether due to fraud or error, designing and performing audit procedures responsive to

those risks, and obtaining audit evidence that is sufficient and appropriate to provide a

basis for our opinion. The risk of not detecting a material misstatement resulting from

fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,

intentional omissions, misrepresentations, or the intentional override of internal control.

● Obtaining an understanding of internal control relevant to the audit in order to design

audit procedures that are appropriate in the circumstances, but not for the purpose of

expressing an opinion on the effectiveness of the Company’s internal control.

● Evaluating the appropriateness of accounting policies used and the reasonableness of

accounting estimates and related disclosures made by the board of directors.

● Concluding on the appropriateness of the board of directors’ use of the going-concern

basis of accounting, and based on the audit evidence obtained, concluding whether a

material uncertainty exists related to events and/or conditions that may cast significant

doubt on the Company’s ability to continue as a going concern. If we conclude that a

material uncertainty exists, we are required to draw attention in our auditor’s report to

the related disclosures in the financial statements or, if such disclosures are inadequate,

to modify our opinion. Our conclusions are based on the audit evidence obtained up to

the date of our auditor’s report and are made in the context of our opinion on the

financial statements as a whole. However, future events or conditions may cause the

Company to cease to continue as a going concern.

● Evaluating the overall presentation, structure and content of the financial statements,

including the disclosures, and evaluating whether the financial statements represent the

underlying transactions and events in a manner that achieves fair presentation.

Considering our ultimate responsibility for the opinion on the consolidated financial

statements, we are responsible for the direction, supervision and performance of the group

audit. In this context, we have determined the nature and extent of the audit procedures for

components of the Group to ensure that we performed enough work to be able to give an

opinion on the financial statements as a whole. Determining factors are the geographic

structure of the Group, the significance and/or risk profile of group entities or activities, the

accounting processes and controls, and the industry in which the Group operates. On this

basis, we selected group entities for which an audit or review of financial information or

specific balances was considered necessary.

We communicate with the board of directors regarding, among other matters, the planned

scope and timing of the audit and significant audit findings, including any significant

deficiencies in internal control that we identify during our audit. In this respect, we also issue

an additional report to the audit committee in accordance with article 11 of the EU Regulation

on specific requirements regarding statutory audit of public-interest entities. The information

included in this additional report is consistent with our audit opinion in this auditor’s report.

We provide the board of directors with a statement that we have complied with relevant

ethical requirements regarding independence, and to communicate with them all relationships

Meltwater N.V. – Annual consolidated and company only financial statements 2021

210

and other matters that may reasonably be thought to bear on our independence, and where

applicable, related actions taken to eliminate threats or safeguards applied.

From the matters communicated with the board of directors, we determine those matters that

were of most significance in the audit of the financial statements of the current period and are

therefore the key audit matters. We describe these matters in our auditor’s report unless law or

regulation precludes public disclosure about the matter or when, in extremely rare

circumstances, not communicating the matter is in the public interest.

2021 Annual Report 211

Income Statement

Using Alternative Performance

Measures (APMs)

2021

2021 Annual Report 212

IFRS Income Statement Reconciliation

Using Alternative Performance Measures (APMs)

($ in millions) 2021 2020

Stock Based Compensation 1.6 0.0

Stock Buyback 0.2 -

One Time Charges 0.3 0.0

DeprAmtCapRD 11.2 10.3

DeprAmtIntangible 6.5 6.9

Depr PPE 0.1 0.1

COGS TOTAL 19.9 17.3

Stock Based Compensation 36.8 3.5

Stock BuyBack 6.7 -

One Time Expenses 1.9 15.8

DeprAmtIntangible 4.8 3.7

Depr PPE 1.0 1.6

SM TOTAL 51.2 24.6

Stock Based Compensation 7.9 0.7

Stock BuyBack 3.7 -

One Time Expenses 10.9 1.9

Charitable Contributions 2.5 2.6

DeprAmtCapRD 2.6 -

DeprAmtIntangible 0.0 -

Depr PPE 0.5 0.9

GA TOTAL 28.2 6.0

Stock Based Compensation 14.0 1.6

Stock BuyBack 2.8 -

One Time Charges 1.4 0.4

DeprAmtIntangible - -

Depr PPE 0.1 0.2

RD TOTAL 18.3 2.2

2021 Annual Report 213

IFRS Income Statement using APMs

Using Alternative Performance Measures (APMs)

($ in millions) 2021 2020

Revenue 401.6 359.8

Cost of revenue 99.9 88.2

Adjusted Gross prot 301.8 271.6

Adjusted Gross prot % 75.1% 75.5%

Adjusted operating expenses

Sales and marketing 170.0 153.2

General and administrative 52.4 45.5

Research and development 40.0 35.8

Adjusted Opex 262.4 234.4

Adjusted Opex % 65.3% 65.2%

Adjusted EBITDA 39.4 3 7. 2

Adjusted EBITDA % 9.8% 10.3%

Add Back

Stock based compensation 60.4 5.8

Stock Buyback 13.4 -

One-time expenses 14.4 18.1

Charitable contribution 2.5 2.6

Loss on extinguishment of debt/loan - 34.3

Foreign exchange (gain)/loss (5.5) 5.5

Other (prot)/loss, net (0.4) (3.9)

Add Back Totals 84.9 62.4

EBITDA (45.5) (25.2)

EBITDA % -11.3% -7.0%

Depreciation & Amortization 26.8 23.7

EBIT (72.3) (49.0)

EBIT % -18.0% -13.6%

Net Interest Expense 4.9 26.4

Provision for income taxes 0.8 0.6

Net Inc/(loss) (77.9) (76.0)

Net Inc/(loss) % -19.4% -21.1%

2021 Annual Report 214

Denitions:

Alternative Performance

Measures

2021

2021 Annual Report 215

Denitions: Alternative Performance Measures (APMs)

Alternative performance measures or

“APMs”: non-IFRS performance measures used

by Meltwater N.V. (the “Company”) as guidance

parameters for both internal and external reporting

to stakeholders. The Company’s APMs may dier

from similar measurement parameters used in

other companies. APMs should not be viewed as

a substitute for any IFRS nancial measure, but

rather as a compliment.

Customer or client: is a unique account (or multiple

accounts governed by a single agreement) with an

active, paid subscription contract.

Total addressable market or “TAM”: the overall

revenue opportunity available to a product or

portfolio of products and / or services, if 100%

market share was achieved. TAM is not a measure

of actual future revenue, but it helps determine the

level of eort and investment warranted for the

Company product and / or service oering.

Annual recurring revenue or “ARR”: the

Company’s yearly recurring revenue expectation

at a given point in time. It is calculated as the

annualized dollar sum of all contracts that have

an active subscription in that period. ARR is a

forward-looking measure that stakeholders can

use to assess revenue momentum and expectations

over the next 12 months. ARR is reported in USD.

Non-USD denominated contracts are converted

at constant currency exchange rates, which are

updated annually.

Constant currency exchange rates: the

Company presents constant currency information

for ARR to provide a framework for assessing how

the underlying business performed excluding the

eects of foreign exchange rate uctuations. To

present constant currency ARR, current and prior

period ARR for contracts in currencies other than

USD are converted into USD. During 2021 nancial

year the constant rate was average December

2020 exchange rates. In order to normalize ARR

uctuation, going forward the Company will report

ARR in constant currency, using weighted average

exchange rate of the prior year, for the results

being compared to for growth rate calculations

presented.

ARR per customer or client spend: the total ARR

in a given period, divided by total customer count

in that period.

New ARR: ARR from new customers within a given

period.

Recurring revenue: revenue that is expected to

continue in the future from subscription-based

contracts, excluding any non-recurring services

such as single delivery reports.

Organic and inorganic: the pre-existing or

standalone operations and performance of

the Company, excluding recently acquired

business. Inorganic refers to the recently acquired

businesses in 2021, namely: Klear, Linkuence

and Owler. DeepReason.ai is excluded as the

acquisition was closed late in the year and the

numbers are considered immaterial.

Segment or portfolio: refers to a sub-section of

the total customers or total ARR, depending on the

context presented. “Total portfolio” refers to the

sum of all customers or ARR. “Product portfolio”

refers to the suite of products the Company sells.

Portfolio concentration and penetration:

portfolio concentration is the proportionate

amount of ARR represented relative to the total

portfolio. Portfolio penetration measures the

proportionate number of customer relative to the

total portfolio. Both measures are expressed as a

percentage.

Premium customers: customers with ARR >$25.5k

are considered premium customers. “Premium

portfolio” or “premium segment” refers to the

sum of all premium customers. Customers with

ARR of $100k or more are also included in the

“$100k+” category. These customer categories are

used to measure the Company’s ability to move

upmarket: expanding within existing customer base

and attracting the largest organizations as new

business.

Social portfolio or segment: the sum of ARR of

all social product subscriptions. “Social products”

refers to Company products than harness

information and create insights from social media

sources, and are grouped into Social Listening and

Analytics, Social Media Management and Social

Inuencer Marketing. “Core Social products”

are a smaller subset of key social products,

(including Explore, Engage and Klear) that have

been identied as aligning the closest with our

key Social use-case. Measuring the growth of our

2021 Annual Report 216

social portfolio allows us to track the eectiveness

of our strategy and prociency to tap into the

growing market opportunity.

Net retention: the change in ARR from customer

churn oset by increases in value of existing

customer subscriptions between end of period ARR

and beginning of period ARR. Net retention is a

dollar-based measure expressed as a percentage

of total beginning of period ARR. Net retention

measures the long-term value of the Company’s

customer relationships and shows our ability to

retain and expand subscription revenue generated

from existing customers.

Churn: a dollar-based measurement of customers

that have not renewed their subscriptions.

Sales productivity: the amount of sales volume

per headcount, and can be expressed in ARR.

Customer lifetime value to customer

acquisition cost or “LTV:CAC”: a measure

(expressed as a ratio) that compares the value of

a customer over their lifetime to the average cost

of acquiring a new customer. LTV is the average

ARR per customer over the course of their lifetime,

calculated as gross margin multiplied by average

ARR per customer multiplied by the inverse of

customer count churn. CAC is the average cost to

acquire a new customer, calculated as total new

business sales and marketing Opex divided by the

number of new customers acquired.

CAC payback: a sales eciency metric that

measures how long (in months) it will take to

break even on the money spent to acquire a new

customer. It is calculated as trailing three months

sales and marketing expenses required to acquire

a new customer divided by trailing three months

new business ARR multiplied by gross margin.

One-time expenses: expenses deemed non-

recurring in nature, such as costs associated with

one-time projects or events, legal settlements and

related fees, employee severance, M&A related

expenses, and the like.

Adjusted COGS: cost of goods sold excluding

depreciation, amortization, stock-based

compensation and one-time expenses.

Adjusted gross prot margin: revenue less

adjusted COGS. “Adjusted Gross Prot Margin”:

is dened as adjusted gross prot divided by

revenue, expressed as a percentage. Adjusted

gross prot margin provides stakeholder

consistency and comparability across nancial

periods and between companies, as it eliminates

the eect of non-cash and non-recurring one-time

items which are unrelated to overall operating

performance.

Adjusted Opex: operating expenses excluding

depreciation, amortization, stock-based

compensation, one-time expenses and charitable

contributions. Adjusted Opex under IFRS

(APMs) would include right of use (ROU) asset

depreciation established by IFRS 16, since the

Company acknowledges leases as rent expenses.

EBITDA: is the gain or loss for the year before

net interest expense, income tax expense,

depreciation and amortization. EBITDA is a

supplemental measure to understand the overall

prole of cash generation and eciency of the

Company’s operating activities. Additionally, by

excluding taxes, foreign exchange gain or loss

and net interest expenses which cannot always

be controlled by the Company, EBITDA provides

an objective, and unlevered measure of the

Company’s protability.

Adjusted EBITDA: EBITDA adjusted for stock based

compensation, one-time expenses, charitable

contributions, loss on extinguishment of debt, and

foreign exchange gain or loss. Adjusted EBITDA is

a measure that excludes non-recurring one-time

items that are not part of the Company’s ongoing

day-to-day operating activities. By excluding these

items, stakeholders have a better overall picture

of prot generation in the Company’s operating

activities.

Adjusted EBITDA Margin: Adjusted EBITDA as a

percentage of revenue. Adjusted EBITDA Margin is

expressed in percentage and is easily comparable

across nancial periods and between companies.

Adjusted EBITDA under IFRS (APM) does not benet

from the right-of-use (ROU) asset depreciation

established by IFRS 16, since the Company

acknowledges leases as rent expenses. Capitalized

interest on leases is added back to adjusted EBITDA.

Available debt: a contractual available credit

from debt facilities such as a revolving credit

facility.

Interest-bearing debt: the amount drawn down

from the available debt or other loan instruments.

2021 Annual Report 217

2021 Annual Report

ir@meltwater.com

meltwater.com

Meltwater N.V.

Singel 250, 1016 AB Amsterdam,

The Netherlands