Annual Report 2020
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17
Annual Report 2020
Business Model
Fyber is a leading technology company operating in the
protocol to unify all connected demand sources,
regardless of the type of technical integration they use,
into a single competitive bidding process for every
single ad opportunity. The winner of the auction is
determined based on the highest price.
field of in-app advertising. The corporate purpose is the
development and marketing of a technology platform and
software solutions for app developers and mobile
publishers, enabling them to generate business-critical
revenue streams from digital advertising.
Fyber's comprehensive app monetization platform,
Fyber FairBid, brings together programmatic mediation,
traditional mediation, app bidding and a variety of
global demand sources integrations in one publisher
dashboard. It addresses deficiencies of current
mediation solutions by enabling all types of buyers to
compete simultaneously over each ad impression in
real-time. This maximizes the competition among
demand sources, leads to yield optimization for app
developers and minimizes missed revenue and
advertising opportunities for both the supply and the
demand side. The product combines the Company's
expertise of mediation and real-time bidding and
brings additional demand to publishers.
Fyber specializes in software-based automated
(‘programmatic’) trading of advertisements ('ads') and aims
to enable mobile app publishers to monetize their digital
contents through the placement of targeted, high-quality
ads within their apps. The Company connects app
developers and their users with advertisers worldwide, who
bid on the ad space within the apps (predefined spaces and
instances within apps, where ads can be displayed at
certain points of time during a session of a user engaging
with the app).
Fyber applies data-driven processes in real-time to ensure
that only relevant and lucrative ads are delivered and
displayed. As such, Fyber supports app developers in
establishing sustainable sources of income and acquiring new
users while maintaining the crucial balance between yield
optimization and a positive user experience. Depending on
the publisher's requirements, all or selected aspects of the
comprehensive technology platform listed below are
accessible through online dashboards provided by Fyber.
Offer Wall Edge: Offer wall is an opt-in, value-exchange
ad format, primarily used within gaming apps. It provides
users with a list of offers from various advertisers, ranging
from watching a video or completing a survey to trying
out another game. Each offer is assigned a specific
value in the virtual currency used in the app, and users
can choose to complete these offers and collect virtual
currency rewards that can be used to make progress in
the game that they are using.
The Company's offering comprises
Ad exchange: the Fyber Marketplace is a programmatic
ad exchange for the in-app environment, offering
strong demand across video and display ad formats. It
brings together thousands of app developers and their
global audiences with more than 180 local and global
advertising partners that offer ad campaigns and bid
on the app's ad spaces.
Data services: including data analytics tools for app
developers which provide a better understanding of
their own user base, enabling
them to form user segments following specific criteria;
helps to achieve higher yield from advertisers, who seek
to place targeted ads.
Ad mediation: a technology platform providing app
developers with the infrastructure to configure ad
placements within their apps, connect, manage, and
optimize a variety of ad networks through a single
integration and interface.
Publisher tools: including features such as ad place-
ments and ad instances that enable publishers to fine-
tune their monetization strategies; online dashboards
that allow for app developers to conveniently manage
their ad monetization.
App bidding (also referred to as “in-app header
bidding”): technology that uses a real-time auction
For transactions placed via the ad exchange Fyber Market-
place the Company retains a share of the ad spend
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Annual Report 2020
ad-vertisers place via the platform, which is the main source
for download against an up-front payment (paid app), offer
basic functionality for free and add premium services
against payment (freemium app = free app including in-app
purchases) or use advertising within free-to-download apps
(free app including in-app advertising). Free and freemium
apps make up the vast majority of downloads.
of income and basis of the business model. The majority of
the generated yield is paid out to the connected app
developers. As such, the Company’s revenue potential is
directly linked to the successful monetization of its partners’
digital contents, aligning Fyber’s and the app developers’
goals.
The vast number of available apps and the download
numbers make it evident how important it is for app
developers to navigate the fragmented market efficiently
and invest into user experience, user acquisition and
monetization.
Enable publishers to establish sustainable
business models
App developers generally rely on three different approaches
to monetize their digital content. They can offer their apps
High-level view on the value chain and the data flow
App developer receives ad
spend for delivered ads
Match ad requests and
deliver ads to apps
Place ads within apps to
engage with their consumers
App
developer
Ad tech
platform
User
Advertiser
Ad Network 1
Ad network 2
Ad Tech Platform
~ Optimizing for
the publisher ~
Advertiser,
Brands,
Demand-side platform 1
Demand-side platform 2
Agencies
Determining
within milli-seconds
the best-suited &
lucrative ad
App & User
App developer
(opt.) ad tech
platform
optimizing
for the
advertiser
to deliver
to the app
Ad exchange 1
Ad exchange 2
User data
(pending consent) +
contextual parameters
(device/engagement
data)
High-level view on the value chain and the data flow; example is for explanatory purpose only and not based on an actual ad campaign
19
Annual Report 2020
The growing market offers vast monetization potential to
User experience is key
them, yet it also poses several challenges in accessing this
potential. Fyber is providing viable solutions for the key
challenges faced by publishers:
Once apps have gained a stable following among users it is
the publishers’ goal to retain them and provide engaging
content, while at the same time monetizing their user-base
in an optimal way. Digital advertising is an essential revenue
stream to most publishers, yet it can only provide a
sustainable income model if the user experience is not
negatively affected by it.
Our solution: Our platform offers publishers an easy way
to manage their monetization strategies, monitor
important KPIs and make changes on-the-fly. For
example, it is possible to adjust ad intensity for different
user groups or do not show any ads to paying users.
Fyber’s monetization experts are also available to
support app developers in establishing a healthy
monetization routine and give recommendations about
ideal ad implementation based on their industry
knowledge and best practices accumulated from our
vast partner network.
Some of publishers’ key challenges and goals
Video delivery at scale
Video remains among the most attractive ad formats and is
currently the only digital ad type with more advertising
demand than available supply. The integration of video ads,
the smooth delivery, viewability and the measurement of
campaign goal achievement is a technical challenge.
Ecosystem fragmentation
Publishers face a crowded ecosystem and a fragmented
pool of advertisers and demand-side players. Manual
integrations with individual advertisers, ad networks or
demand-side platforms are not feasible. The process is
prone to error, takes up engineering resources to implement
and maintain and delivers suboptimal monetization results.
Implementing and optimizing advertising on their properties
is not the core business of app developers – building great
apps is!We believe that the need for publisher-focused
neutral technology – specifically for the fastest growing
video ad formats – creates a significant market opportunity
for independent providers like Fyber.
Our solution: Fyber’s dedicated tech platforms provide
reliable and guaranteed video ad delivery across screens,
players, formats, and environments. They solve
challenges around measurement, tracking, viewability
and the adoption of different pricing models. This
enables publishers to open their inventory up to video
ads, which on average achieve higher prices than more
traditional static ad formats.
We believe that the need for publisher-focused neutral
technology – specifically for the fastest growing video ad
formats – creates a significant market opportunity for
independent providers like Fyber.
There is a strong market demand for focused technology
providers who handle the access to advertising demand
and guarantee independent yield optimization for app
developers, keeping the interests and needs of app
developers in mind at all times.
Moreover, the market is also very crowded on the publisher
side, with the number of publishers and available apps
growing steadily. Publishers need to cut through the noise to
reach, attract and retain their target audience.
Our solution: Fyber’s publisher-focused monetization
solutions provide access to a variety of demand sources
through one integration, enabling monitoring, analytics,
and yield optimization through a single point of access.
Specific tools and campaign types support
discoverability and the building of a steady user base.
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Annual Report 2020
Recent developments in Fyber’s product and
technology offering
Furthermore, several new layers have been added to the
format’s optimization algorithms that prioritize the best
‘offers’ available at any given point in time.
Our product focus and investment strategy are centered
around solving the above-mentioned challenges app
developers are facing and supporting them in key aspects
of their value creation. Despite the many challenges the
year 2020 brought, Fyber delivered on all its product goals
and set the Company up for future growth by proactively
adapting to the evolving market circumstances.
Fyber’s differentiators & growth strategy
During the 10-year history, Fyber accomplished a defensible
competitive position, based on the proprietary technology,
the Company’s market focus and the direct integrations
with its partners. Our differentiators include:
To name a few highlights, Fyber established industry-best
ad rendering solutions for the Fyber Marketplace, launched
the support of the new innovative and interactive ad format
“Playables” and pioneered a mitigation plan for the app
industry on Apple’s new privacy policies to be released in
iOS 14. In an effort to ensure that demand-side platforms
will still have a relevant, diverse data set available as a
basis for their bidding decisions, which drives campaign
performance and return on advertising spend, Fyber
launched contextual in-app targeting. In an era without
access to the previously used ID for advertising (“IDFA”), this
provides advertisers with context that is generated from a
mix of privacy-friendly data points coming from the user’s
device, the underlying technology, and session-level
behavioral information. Fyber worked with the leading
demand companies of the industry and other ad tech
companies to compile clear specifications around
contextual targeting and establish a new standard. The
Company continuously expands the catalogue of privacy-
aware parameters that hold valuable information for the
purpose of campaign targeting and optimization. Fyber’s
product suite also supports Apple’s SKAdNetwork, a method
for validating advertiser app installations in the context of
programmatic ad trading without using IDFA to identify the
user. For the first time, Fyber co-authored the technical
specifications published by the IAB Tech Lab (Interactive
Advertising Bureau, a leading trade group for digital
advertising), setting the industry standard on how to adopt
SKAdNetwork.
Technology & innovation: first-to-market with a true
app bidding solution with Fyber FairBid; advanced from
a leading provider of display advertising to becoming a
top contributor to many of our clients’ income from
video advertising;
Direct technical integrations with app developers: The
direct technology-based integrations Fyber maintains
with leading app developers are among our main
assets. They position the Company as a trusted source
of high-quality in-app inventory at scale. As leading
advertisers continue to shift their attention to in-app,
quality, viewability and brand safety become key selling
points in the industry.
Offering independent publisher-centric monetization
solutions fully focused on their needs: We set a
deliberate focus on supporting app developers and
built our technology assets specifically for this purpose.
Fyber is not offering products that compete with the
app developers’ business but aligns its business goals
with its publisher partners.
The market’s supply side is less competitive than on the
advertiser side, which is dominated by major providers
such as Google and Facebook. Moreover, Fyber is
partnering with many of the leading demand
companies and captures parts of their advertising
budgets, which are processed through the Fyber
platform.
On the publisher monetization platform Fyber FairBid the
Company added unique multi-testing tools for publishers
and significantly increased the amount of supported
mediated networks. This helped to grow the platform's
reach and increased the average revenue per daily active
user generated for the connected app developers using this
comprehensive mediation solution.
One-stop-shop for publisher, covering all aspects of
their in-app advertising optimization needs
Expert guidance for publishers by our monetization
experts
Diversified revenue base by geography and product;
covering rewarded and non-rewarded ad formats
For the Company’s leading rewarded ad format Offer Wall
Edge, the focus was on launching the new buy-side
platform for advertisers, ACP Edge, offering advanced
‘micro bidding’ targeting features. Initial tests clearly showed
an uptick in click-through and conversion rates.
Fully focused on the fastest growing subsegment of the
mobile advertising market – in-app, video, and gaming
– a market with many complexities and high barriers of
entry
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Annual Report 2020
The Company will continue to invest into technology to fulfill
the growth strategy laid out for 2021 (please refer to the
‘Forecast Report’ below for details). This includes completing
the transition to a video-first company with expanding the
product offering and integrating further dedicated demand
partners. The Company looks to increase the market
penetration of its holistic ad monetization solution
consisting of mediation, programmatic demand, and Offer
Wall. One of the areas of focus for this project is to further
expand growth from brand demand in line with the market
development and develop reach in new geographies, albeit
with the existing sales teams and office locations.
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Annual Report 2020
Market Update
Fyber was active in almost 180 countries during 2020,
Based on the download numbers for the second quarter of
2020, which broke records in terms of quantity, time spent
and consumer spend, gaming accounted for roughly 45% of
all downloads on Android and more than 30% on iOS.
However, when it comes to user spend, the gaming segment
picked up the greater part of the spend across both stores,
with 85% on Google Play and 65% on the App Store. The
segments games, tools, and entertainment led the
download charts on Google Play. On iOS, games, photo,
video, and entertainment remained the biggest segments
by the number of downloads throughout 2020. (Source: App
Annie, January 2021)
offering comprehensive technology and superior service to
mobile app developers and publishers. The Company
benefits from various global growth trends in the field of in
app advertising and online consumer behavior such as the
growing advertising spend allocated to mobile devices, the
increase in the time users spend on their smart connected
devices using apps and their engagement with digital
content.
While 2020 was a challenging year for economies
worldwide due to COVID-19 counter measures such as
business closures and stay-at-home orders, the digital
advertising space proved to be resilient and recovered
swiftly from short-term impacts recorded in the second
quarter of the year. Fyber’s core market, the mobile in-app
advertising market, contributed significantly to the growth
of the digital ad space even in this year of crisis.
Given the vast amount of available apps and the common
user behavior of frequently downloading and trying new
apps, app discovery and user acquisition remain key
challenges for app developers. (Source: App Annie, January
2021)
Market overview
App Annie confirmed their previous estimation for the
global mobile advertising spend with $240 billion for 2020
and assumes at least 20% growth for this year, representing
an expected $290 billion to be spent on mobile channels in
2021. Interstitials and video ad format remain the most used
ad formats. (Source: App Annie, January 2021)
During 2020, the global number of smartphone users
reached 3.5 billion (Source: Statista, January 2021). There
were more than 4.4 million apps available to download on
the two major app stores Google’s ‘Google Play’ and
Apple’s ‘App Store’ alone, offering a vast amount of new
products in all app categories. (Source: Business of apps,
October 2020)
Statista estimates the global advertising spend in 2020 to
amount to $517 billion (Source: Statista, July 2020), which
would bring the share of mobile advertising to above 45% –
making it the single biggest channel in advertising.
Advertisers continue to shift their budgets to mobile,
following their customers and engaging with them via the
media channels they use the most.
US consumers are expected to spend more than 55% of
their media usage with digital channels, followed by 28%
with TV, 12% with Radio and just 2% with print media.
(Source: eMarketer, April 2020)
Most app categories saw an increase in the number of
downloads, many influenced by the COVID-19 pandemic
and the changes to the day-to-day life and business
settings. The biggest growth was reported in the verticals
Business (+134% compared to 2019), Medical (+66%),
Education (+41%) and Games (+33%). Only Travel and
Navigation apps saw a decline in the number of
downloads during 2020. (Source: SensorTower, January
2021)
App analytics company App Annie reported a 7% YoY
increase in the number of downloaded apps, totaling more
than 218 billion downloaded apps in 2020. The average time
users spend on their mobile devices increased by 20% to
more than 4 hours per day. This makes mobile – led by in-
app – to the media channel with the highest reach and
depth of engagement.
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Annual Report 2020
Factors that indicate continued, sustainable market growth,
as reported by market researchers, and based on the
Company’s own experience and market insights, include:
appointments, during shopping etc. (Source: Simform,
January 2020), which makes it a particularly interesting and
versatile channel for marketers and brands to engage with
their key audiences in a targeted way.
Continued growth in the number of mobile connected
devices, including from emerging markets
Looking only at the Top 5 app verticals, games made up
more than 53% of all downloads on iOS and almost 70%
on Android. Notably, the volume of downloads on Android is
now more than triple that of Apple’s offering (Source:
SensorTower, January 2021), in line with the fact that
Android accounted for more than 70% mobile operating
system market share worldwide by August 2020. (Source:
Statcounter, December 2020)
Evolving devices with larger screens and higher
resolutions; increased network performance through
evolved 4G deployments; 5G subscriptions expected to
reach 190 million by the end of 2020 and 2.8 billion by
2025 (Source: Ericsson, June 2020), set to provide a
boost to performance and user experience, providing
app developers with new opportunities for their
products
The global mobile gaming market reached a new high in
2020 also in terms of user spending – exceeding $79 billion,
a plus of 26% compared to 2019. While the pandemic
added to that growth especially in the second quarter, the
baseline growth remained strong at around 15% YoY. The
quarterly spending numbers peaked in Q4 2020 at $21
billion (Source: SensorTower, January 2021), which is after
many markets already tuned down lockdown
Continued shift of marketing budgets to mobile and in-
app; brand advertising spend on in-app is still in its
early days, offering significant up-sell potentials to
players like Fyber, who offer dedicated in-app solutions
and years-long track record of technological leadership
New generation of mobile-first and partly mobile-only
users forming a key audience for marketers; e.g. 75% of
digital users consume all their social media, lifestyle,
travel, news, and utility content using mobile apps
(Source: ComScore, June 2019)
measurements, indicating that the accelerated growth is
likely to persist following the pandemic.
For the full year 2020, consumer spend on mobile gaming
apps are expected to outpace both the spend on desktop
and on console games by 3x. (Source: App Annie, January
2021)
Strong return on investment possibility for marketers:
digital advertising allows for close performance
tracking and is favored over traditional media, as tools
to programmatically increase the return on advertising
spend will evolve further
Digital advertising markets proved resilience in times
of COVID-19
Media intelligence company ‘Magna Global’ estimated in
June 2020, that the global advertising revenue might decline
by 7% in 2020 YoY, as the COVID-19 crisis caused an
economic recession, a contraction of GDP across the largest
markets of up to 12% and with that a significant decline in
traditional, linear advertising such as TV, print, out-of-home
advertising, and cinema. The impact was to be offset by the
resilience of digital and especially mobile advertising. In
December, these estimates had been confirmed and
substantiated. Digital media turned out to be even more
robust than anticipated, with the US digital ad spend
growing by more than 10% in the crisis-ridden year of 2020,
the global digital ad spend is expected to come in at 8%
New in-app advertising formats to drive user
engagement and add to the market growth, e.g.
playable ads
Gaming ecosystem
Smartphone users have on average about 40 apps installed
on their devices, but frequently use only half of them.
Gaming comes in second in terms of the time users engage
with their favorite apps, outpaced only by social media
apps. Users engage with apps all throughout the day, while
at home, at work, during their commute time, waiting for
24
Annual Report 2020
growth compared to 2019 – limiting the contraction of the
overall advertising market to about 4% YoY.
static ad formats such as banners. Generally known to
deliver the highest level of engagement and blending in well
with the user experience of the app, video ads are
particularly popular within gaming apps. A market study by
InMobi completed in September 2020 found that 36% of
the video ad spending was directed towards the gaming
vertical. (Source: InMobi, September 2020)
‘Magna Global’ asserts that part of the growth in digital
advertising is directly attributable to the pandemic, which
led to increased supply (growing number of users, increase
in the time users spend with digital media etc.) and demand
(brands increasing the spend on sought-after channels,
smaller businesses turning to digital marketing for the first
time etc.). At the same time, they do not expect a “return to
normal” in the split of available ad budgets but believe that
the recent events shifted the long-term direction of the
advertising market even more towards the digital ecosystem
in a sustained way. This is in line with App Annie’s assertion
that user habits (Q2 2020 saw a peak in app downloads led
by games and a monthly all-time high of time spent within
apps in April 2020) will carry over into the times following
the lift of pandemic restrictions.
Video is particularly important when it comes to the app
publishers’ efforts of generating new users for their titles. A
market study by AdColony found that 42% of user
acquisition budgets are spent on video, with 27% of
marketers planning to shift further budgets to video in the
future. 55% of advertisers state that video advertising is
effective, the highest percentage for all reviewed formats.
(Source: AdColony, June 2020)
Programmatic trading is the go-to advertising trading
mechanism
For 2021, the market researcher refers to the IMF’s October
2020 prediction of 5.2% expected global GDP growth for
this year. They assert that with the successful execution of
large scale vaccination campaigns the global economy
should recover swiftly, with major events such as the
Olympic Games or the UEFA Football Championship
adding to the growth in advertising activity, with digital
advertising returning to double-digit growth in 2021.
Programmatic trading accounts for the vast majority of all
advertising budgets spent on digital display channels.
eMarketer estimates that more than 84% of the US digital
display advertising will be transacted programmatically in
2020, with mobile and video advertising on non-social
media channels driving most of the growth. (Source:
eMarketer, August 2020)
Fyber’s business and product focus was set to significantly
benefit from the described market trends. By design, the
Company offers premium solutions to the leading gaming
publishers, focusing on programmatic advertising
Video advertising fueling overall market growth
Marketers’ spend on mobile video advertising grew by more
than 7.5x between 2015 and 2020. The generally higher cost
per ad placement is paid off by significantly higher click-
through rates attributed to video ads in comparison to
technology and innovative video and interactive ad formats.
25
Annual Report 2020
Business Performance
The below business performance reviews Fyber’s key financial
doubled to €170.4 million compared to 2019. Of that, video
in particular added to the growth. Programmatic video
advertising made up 40% of the overall revenue in Q4 2020,
delivering 13x growth compared to the last quarter of 2019,
and 34% in the full year 2020, growing 9x to €70.8 million.
indicators 2020 compared to the previous period. The repor-
ting period’s focus was on leveraging the past investments
into Fyber’s video advertising capabilities and the main
revenue contributor, the Fyber Marketplace. The Company
furthermore benefited from the lean cost base established
over the last years, which allowed the business to scale
while increasing profitability.
In line with our planning, revenue growth from the non-
programmatic Offer Wall Edge ad format remained flat.
The revenue stemming from programmatic trading,
transacted through the Fyber Marketplace, more than
Revenue composition
FY 2020
FY 2019
Change YoY
Q4 2020*
Q4 2019*
Change YoY
in € millions, rounded
Programmatic video advertising
Programmatic display advertising
Total programmatic business
Non-programmatic business
One-off effects
71
7
73
81
857%
36%
111%
3%
36
45
81
9
3
1,266%
81%
100
170
39
25
27
9
193%
-2%
38
1
0
n/a
0
0
n/a
Reported revenue
210
119
76%
89
36
145%
* Please note that all quarterly figures in this report are unaudited.
The organic growth in Fyber’s programmatic business
accelerated compared to the already positive development
of 2019, and more than doubled in 2020 to €170.4 million,
making up more than 80% of the overall revenue. The growth
stems from scaling up Fyber’s activity with leading mobile
gaming companies, across both existing and newly acquired
clients.
26
Annual Report 2020
Development of revenue share paid to third parties
Year ended 31 December
2020 2019
in € millions, rounded
Three months ended 31 December**
2020 2019
Revenue
209.8
119.0
(78.7)
40.3
89.1
(71.5)
17.6
36.3
(27.4)
8.9
Revenue share to third parties
Net revenue*
(164.4)
45.4
Net revenue margin*
Other cost of sales
Gross profit
21.6%
(14.9)
30.5
34%
(20.8)
19.5
19.7%
(3.4)
24.5%
(3.3)
14.2
5.6
* Net revenue: not a measure calculated in accordance with IFRS, but often referred to as a term of analysis in the industry, describing the revenue
less the share paid out to connected publishers and app developers as their monetization yield.
** Please note that all quarterly figures in this report are unaudited.
The Company’s net revenue increased by 13% to €45.4 million
in 2020. Q4 2020 saw 98% year-over-year (“YoY”) growth to
€17.6 million (Q4 2019: €8.9 million). The growth is led by the
positive development of Fyber’s video ad business, which is
expected to continue and accelerate in 2021.
The strong growth stemming from the programmatic
business led to a changed revenue mix and with that a
decrease in net revenue margin, as the average net revenue
margin for the programmatic business is lower than the
non-programmatic business.
27
Annual Report 2020
Consolidated income statement – Highlights
Year ended 31 December
2020 2019
Three months ended 31 December**
2020 2019
in € millions
119.0
Revenue
209.8
(179.3)
30.5
(12.1)
(15.0)
(7.7)
89.1
(74.7)
14.3
(3.3)
(3.9)
(2.7)
1.6
36.3
(30.6)
5.6
Cost of sales
(99.5)
19.5
Gross profit
Research & development
Sales & marketing
(12.8)
(15.9)
(8.8)
(3.1)
(3.7)
(2.5)
7.0
General & administrative
Depreciation & amortization
Stock option plan
8.9
17.3
1.0
0.9
(0.5)
0
(0.5)
(2.2)
0.6
Other adjustments
0
(2.9)
Adj. EBITDA*
5.6
(2.7)
-6.8%
(20.5)
(48.8)
5.5
Adj. EBITDA margin from net revenue (%)*
Earnings before interest and tax
Profit for the year after tax
12.4%
(4.8)
(15.5)
31.8%
3.9
5.2%
(6.4)
(2.7)
2.8
* We define adjusted EBITDA as our consolidated earnings before financial income (expense), income taxes, depreciation and amortization, adjusted to
eliminate one-off impacts such as impairment of goodwill, acquisition related costs and option plans. Adjusted EBITDA is not a measure calculated in
accordance with IFRS. We have included adjusted EBITDA in this form because it is a key metric used by our Management Board and Supervisory Board
to evaluate operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, we be-
lieve that the adjusted EBITDA can act as a useful metric for period-over-period comparisons of our core business. Accordingly, we believe that this metric
provides useful information to investors and others in understanding and evaluating our operational results in the same manner our management does.
** Please note that all quarterly figures in this report are unaudited.
The overall revenue increased by 76% year-over-year (“YoY”)
to €209.8 million. Fyber further expanded their focus on video
advertising as planned and turned both the product enhance-
ments and the targeted expansion of the Company’s partner
networks both on the publisher and advertiser side into
strong revenue growth.
Profitability detail
Year ended 31 December
Cost of sales mainly consists of the revenue share paid to third
parties, i.e. the yield Fyber generates for app developers and
pays out to them, amounting to €164.4 million in 2020. Other
components include IT cost, amortization of technology and
customer relationships acquired through business combina-
tions and amounted to €14.9 million compared to €20.8 million
last year. The decrease is attributable to the amortization of
technology and customer relationships. The total cost of sales
amounted to 85% of revenue, compared to 84% in 2019.
We stabilized the operational cost, proving the scalability of
the business. Despite the 76% growth in revenue, the opera-
tional cost for sales & marketing, research & development as
well as general & administration was reduced to €34.8 million,
compared to €37.5 million in 2019.
in € millions
2020
(4.8)
2019
(20.5)
17.8
Earnings before interest and tax
Total adjustments
10.4
9.4
Thereof depreciation,
amortization & impairment
17.3
0.9
Thereof ‘Stock Options
Program’
1.0
Thereof other adjustments
in general & administrative/
other income
0
(0.4)
Adjusted EBITDA
5.6
(2.7)
28
Annual Report 2020
Fyber achieved positive adjusted EBITDA for the full year
At the balance sheet date, the Group had shareholder loans
with Tennor Holding B.V. amounting to €32,000 thousand
(31 December 2019: €30,000) plus accrued interest of €4,788
thousand (31 December 2019: €2,237 thousand) which
mature in June 2022. Note that subsequent to the balance
sheet date an amount of €15,000 thousand has been
extended to June 2023, refer to note 44 subsequent events.
2020, amounting to €5.6 million, mainly driven by the
revenue growth in Q4 2020. Combined with the close cost
management the Company applied throughout the year
this enabled to turn the significant revenue growth into full-
year profitability on an adjusted EBITDA basis.
The Company achieved positive cash flow from operating
activities on the full year basis for the first time, amounting
to €10.4 million. The cash balance increased substantially to
€26.0 million at year-end 2020.
Furthermore, the Group has revolving credit facilities from
banks amounting to €25,821 thousand of which €21,379
thousand had been drawn (31 December 2019: €17,949
thousand). These credit facilities are due within the next 12
months following the reporting date and considered current
financing.
Based on our estimation of continued growth in the program-
matic business and a stable non-programmatic business, the
Company’s working capital is sufficient to meet existing pay-
ment obligations becoming due within the next 12 months.
The preliminary results of the first three months of 2021
support this assessment. The estimated expected future cash
flows from operating activities are largely based on manage-
ment’s expectations and estimates. These are uncertain as
they are influenced by subjective elements such as forecasted
results, margins from operating activities and the ability to
maintain existing bank loan facilities.
Finally the Group has a convertible loan amounting to €73.4
million as per 31 December 2020 with a maturity date of
July 2022; the company is dependent on the successful con-
version of the loans into equity since this is one of the con-
ditions in order to finalize the acquisition by Digital Turbine.
Based on the current cash flow projections and liquidity
analysis the Group is not able to repay these credit facilities
within the next 12 months if needed. Therefore, the Group
depends on the willingness of the banks, bondholders and
the shareholder to prolong its financing.
Cash flow and going concern considerations
These events and conditions relating to the company’s
financing position indicate the existence of a material
uncertainty which may cast significant doubt about the
company's ability to continue as a going concern.
Year ended 31 December
in € millions
2020
10.4
2019
(9.2)
Net cash flow from operating activities
Net cash flow from investing activities
Net cash flow from financing activities
(3.3)
6.1
(5.5)
14.9
Effect from Covid-19
As in 2020 almost everything was to some extent affected
by COVID-19 and the several countermeasures taken by
many countries around the world, also the Group experien-
ced a short term decline in available advertising budgets at
the end of Q1 and Q2. In view of the uncertainties connec-
ted to COVID-19, management has taken comprehensive
measures which included a temporarily global closure of the
Group’s offices and implementing a sustainable working
from home policy for all its employees. Further, ongoing
projects were reassessed before the background of the
current situation and some were put on hold enabling the
Group to temporarily reduce the working capacity by more
than 20% and personnel expenses accordingly in Q2 2020.
The rapid recovery including the return and even expansion
of brand advertising budgets which started April 2020
underlined the resilience of digital advertising to the current
pandemic but also management’s focus keeping up
investing in growth areas.
Net change in cash and
cash equivalents
13.3
(0.2)
12.9
0.2
0.4
Net foreign exchange difference
Opening balance cash and
cash equivalents
12.3
Closing balance cash and cash
equivalents and cash deposits
26.0
12.9
As of 31 December 2020, the Group reported a loss and as
a result of €15,500 thousand negatively impacting equity of
€14,862 thousand (31 December 2019: €33,076 thousand).
While both operating and total cash flow were positive as
such cash and cash equivalents amounted to €25,972
thousand (31 December 2019: €12,876 thousand) the
consolidated working capital showed a deficit of €11,007
thousand (31 December 2019: €12,540 thousand).
However, management continues to observe the current
development around COVID-19. While on the one hand
29
Annual Report 2020
there are promising news around the progress of people
However, management is confident that the Group will
continue the positive trend established in 2020 despite any
impact of the pandemic that the Group and in its ability to
prolong the credit facilities before repayment will become
due in December 2021.
getting vaccinated in some countries, other countries lag
behind the plan and report rising numbers of infections and
mutations of the virus, creating additional pressure on
policymakers to keep lockdown measures in place or even
tighten them, which has a continuing effect on the global
economy.
Therefore, there are still uncertainties around the extent and
timing of the future spread or mitigation of COVID-19 and
around the imposition or relaxation of protective measures.
The Company cannot reasonably estimate the impact to its
future results of operations, cash flows or financial condition;
infections may become more widespread and the limitation
on the ability to work, travel, as well as any closures or
supply disruptions, may be extended for longer periods of
time and to other locations, all of which would have a
negative impact on the Company’s business, financial
condition and operating results. In addition, the unknown
scale and duration of these developments have macro and
micro negative effects on the financial markets and global
economy which could result in an economic downturn that
could affect demand for the Company’s products and have
an adverse effect on its operations and financial results,
earnings, cash flow and financial condition.
Consolidated statement of financial position – Highlights
Per 31 December
2020
2019
in € millions
137.4
Intangible assets
148.3
10.0
12.9
Other assets
9.9
26.0
65.0
5.7
Cash and cash deposits
Trade and other receivables
Other financial assets
Total assets
29.5
8.2
244.0
132.6
78.3
5.2
208.9
120.7
36.7
5.8
Interest bearing loans
Trade and other payables
Employee benefits liabilities
Other liabilities
12.7
12.7
Deferred tax liabilities
Total liabilities
0
0
229.1
14.9
175.8
33.1
Total equity
30
Annual Report 2020
Following several smaller conversion of the outstanding
convertible bonds (the “Bonds”, €150 million original
principal, 07/2020, ISIN XS1223161651) into shares, the
Company is mainly financed through the remaining Bonds
of €72.7 million maturing in July 2022, as well as shareholder
loans from Tennor Holding B.V. (“Tennor”).
Shareholder loans: As per 31 December 2020, €36.8
million including accrued interest were outstanding
under the shareholder loans with Tennor. After the end
of the reporting period, the loans were assigned to
Meridian Capital International Fund and prolonged to
June 2022 and March 2023 respectively. Please refer to
the ‘Subsequent events’ section of this report for details.
Convertible bonds: As per 31 December 2020, €72.7
million in bonds were outstanding. After the end of the
reporting period, further €53.7 million in bonds had
been converted, bringing the newly outstanding
amount to €19.0 million. Please refer to the ‘Subsequent
events’ section of this report for details.
Bank loans: As per 31 December 2020, the Company
had revolving credit facilities from banks of $22.5 million
and €7.5 million respectively, which were previously due
in December 2020 and were extended by one year to
November 2021 and December 2021 as per usual. The
facilities are considered current financing. The
Company does not see a risk that these facilities will
not get extended.
31
Annual Report 2020
Forecast Report
The Company experienced strong growth during the year
full year 2021 was therefore increased in April 2021, to a
revenue between €300 million and €350 million, with the
net revenue of between €60 million and €70 million, at an
adjusted EBITDA between €15 million and €20 million (previous
guidance: revenue between €275 million and €300 million,
net revenue between €55 million and €60 million, adjusted
EBITDA of €10 million).
2020, despite the challenges and uncertainties brought to
the global economy by COVID-19. Many countries Fyber is
operating in took measures designated to limit the spread
of the pandemic, including workplace closures and travel
restrictions. Fyber was an early adopter of working from
home policies for all global offices, restricting business
travel and adhering to all guidelines of local governments
and public health authorities. As a technology company
delivering digital products and services we were less
affected in our operations by the changes and had all tools
and systems already available to work remotely for an
extended period of time. As such, no unplanned investments
were necessary to transition our operations to match the
new requirements. As such, Fyber was able to deliver on the
product and business roadmap for 2020 as planned.
While the economic effects of COVID-19 remain subject to
some degree of uncertainty, Fyber built up a strong pipeline
of new client prospects for 2021 and is confident it will
report continued growth in its operational and financial
results. As the timing and impact of Apple’s anticipated
privacy changes remain uncertain as of today, this is
accounted for in the current guidance only based on
estimations and expectations. Fyber continues its product
and business initiatives to minimize any impact stemming
from these policy changes.
The digital advertising industries, driven by the mobile and
in-app sector, proved to be resilient and delivered growth
based on the users’ growing engagement and time spent.
Initial preliminary results for Q1 2021 show an acceleration
of the recent growth trend, with the revenue amounting to
€85.6 million at an adjusted EBITDA of €7.4 million.
Based on a strong start to the year 2021 and a positive
outlook for the rest of the year, Fyber expects to continue
its double-digit revenue growth trend. The guidance for the
Q1 2021*
Q1 2020
Change YoY
In € millions, rounded
Revenue
86
17
7
31
9
180%
89%
n/a
Net revenue
Total adjusted EBITDA
*Note: all figures preliminary and unaudited
(0.8)
FY 2021 forecast
FY 2020 reported
In € millions, rounded
Change YoY
Revenue
300-350
60-70
210
45
6
> +43%
> +33%
> +150%
Net revenue
Adjusted EBITDA
15-20
32
Annual Report 2020
Subsequent Events
New share issuance in relation to bond conversion
and stock option program
definitive agreements with the Company’s major
shareholders to acquire a more than 90% shareholding in
the Company at a total valuation of up to $600 million net
of the Company’s debt for 100% of Fyber’s share. This
transaction is subject to customary closing conditions and is
expected to be closed in Q2 2021. Following the closing, the
remaining shares shall be acquired by Digital Turbine in a
mandatory takeover offer extended to all outstanding
shareholders over the next months.
Fyber fully supports the acquisition and has entered into a
separate support agreement with Digital Turbine providing
for among other things Digital Turbine’s commitment to the
employees and the Company’s investment and growth
strategy.
Throughout the first four months of 2021, the Company
issued new shares to fulfill convertible bonds conversion
requests of 493 bonds as well as the stock options exercised
by employees during the fourth quarter of 2020. In total, the
Company issued an additional 164.3 million shares in the
first four months of 2021. Consequently the new issued
capital as of the date of this report amounts to €53,652,262,
divided into 536.5 million ordinary shares.
Assignment of shareholder loans to third party
and prolongation
With effect from 17 February 2021, Tennor assigned the five
promissory notes that together made up the shareholder
loans, to Meridian Capital International Fund (“Meridian”).
All terms and conditions remain unchanged. Meridian
agreed to extend the loans as planned by the Company
to June 2022 and March 2023 respectively.
Optional redemption of Bonds
On 15 April 2021, Fyber gave notice to its bondholders that
the Company is exercising its option pursuant to condition
(6(b)(i) of the terms and conditions of the Bonds to redeem
all of the outstanding Bonds on 17 May 2021 at their
principal amount together with accrued and unpaid interest
to such date. As an alternative to the redemption of its
Bonds, each bondholder may exercise the conversion rights
relating to its Bonds until 7 May 2021.
Fyber to be acquired by Digital Turbine
On 22 March 2021, the Company announced that Austin-
based Digital Turbine Inc., “Digital Turbine” (Nasdaq: APPS),
a global on-device mobile platform company, has signed
33
Annual Report 2020
Risk Management
Minimized operating risks by ensuring that the
appropriate infrastructure, controls, policies, systems,
and people are in place throughout the business
Risk management is an integral part of Fyber’s daily
business operations. It is promoted by top-level manage-
ment and designed to ensure that the most relevant
strategic, operational, financial and compliance risks are
identified, monitored, and managed appropriately.
Our approach to risk management, the main risks per
category and actions to manage, control and mitigate
the risks are described below.
Organizational design that supports business objectives
and a culture that encourages open and transparent
communication
Financial shared service center with a centralized
enterprise resource planning environment which allows
us to monitor our business throughout all regions and
apply a consistent level of control
Approach to risk management
Senior management agrees on the risk management priori-
ties for the Company. The risk profile is discussed and agreed
with the Management Board and updated annually in order
to manage our most relevant risks. During the year, we
monitor the mitigating actions and the trend for each risk.
Centralized treasury operations to manage cash balances
and exposure to credit default and currency risks through
treasury policies, risk limits and monitoring procedures
The business risk profile is taken into account when
establishing the Company’s strategy, annual business plans
and budgets.
Ensure the code of conduct and internal policies are
accessible to all staff via the intranet, which includes
whistleblowing facilities
Fyber follows a top-down approach whereby management
identifies and tracks the major risks that could affect the
Company's business objectives and assesses the
Adherence to legal and regulatory requirements
Reliable decision-making support
effectiveness of the processes and internal controls in place
to manage and mitigate those risks. Assurance on the
effectiveness of controls is obtained through management
reviews and discussions, monitoring dashboards, self-
assessments and testing of certain aspects of our internal
financial control systems. This, however, does not imply that
certainty as to the realization of our business and financial
objectives can be provided, nor can the approach of the
Company to control its financial reporting be expected to
prevent or detect all misstatements, errors, fraud or
violations of law or regulations.
Risk appetite and impact
Our willingness to assume risks and uncertainties (the risk
appetite) differs for each risk category. The level of the
Company's risk appetite gives guidance as to whether Fyber
would take measures to control such uncertainties. The
overview table shows the appetite, the occurrence likelihood,
and the expected impact on the group's achievement of its
strategic, operational and financial objectives if one or more
of the main risks and uncertainties were to materialize. The
risk impact is shown ‘net’, meaning that the risks are
described after taking the risk response into consideration.
The key features of our internal controls system are as follows:
Strong governance standards based on the (1) ultimate
responsibility of the Management Board and (2)
supervision of the Management Board by the
Supervisory Board
Group risk profile
Below is an overview of the risks that we believe are most
relevant to the achievement of our strategy. The sequence of
risks does not reflect an order of importance, vulnerability, or
materiality. This overview is not exhaustive and should be
considered in connection with forward-looking statements.
There may be additional risks not yet known to the Company
or which are currently not deemed to be material.
Defined lines of accountability and delegation of
authority, together with reporting and analysis against
budgets
34
Annual Report 2020
● low
● medium ● high
Likelihood
Risk overview
Category
Description
Appetite
Impact
Strategic risks
Market risk – Failure to respond to market trends
Market risk – Dependence on app stores and exposure
to intense competition
Market risk – External effects impacting the effectiveness
of the Company’s product offeringn
Refinancing risk – Failure to repay debt facilities
Operational risks
Personnel risk – Failure to attract, develop,
retain and motivate talent
Infrastructure risk – Failure to secure functioning
of the IT infrastructure
Fraud risk – Failure to detect fraudulent activities
Technology risk – Failure to develop and implement
the unified product roadmapp
Technology risk – Open source software programs
Financial risks
Currency risk – Failure to combat unfavorable
movements in foreign currencies
Working capital risk – Seasonality of advertiser spending
Credit risk – Pre-financing substantial part of our revenue
Financing risk – Failure to secure financing and exposure
to liquidity risk
Financing risk – Dependence on major creditor
Financing risk – Exposure due to pledging of
significant part of assets
Impairment risk – Failure to meet initial expectations
Monitoring risk – Threats to going concern assumption
Price risk – Failure to maintain current margin levels
Capital risk – Volatility of share price and risk of dilution
Compliance risks
Compliance risk – Failure to comply with relevant laws
and regulations
Compliance risk – Potential conflict of interest between
major shareholder and others
Data risk – Failure to comply with increasing data
security regulations
Description of risk categories
Strategic risks
Risks relating to prospective earnings and capital arising from strategic changes in the business environment and from
adverse strategic business decisions.
Operational risks
Financial risks
Compliance risks
Risks relating to current operational and financial performance and capital arising from inadequate or failed internal
processes, people, systems orexternal events.
Risks relating to financial loss due to the financial structure, cash flows and financial instruments of the business
(including capital structure, insurance, and fiscal structure) which may impair the ability to provide an adequate return.
Risks resulting from non-compliance with relevant laws and regulations, internal policies, and procedures.
35
Annual Report 2020
Strategic risks
Fyber may be unable to adapt swiftly to changes in industry or market circumstances, which could have a material
adverse impact on its financial condition and results.
Fyber was incorporated in February 2012 (as RNTS Media N.V.) and has made significant acquisitions within the last years, increasing
the group’s scope, operations, and product offering. Although the in-app advertising industry has matured over recent months and
years in different aspects, the industry is still fast-paced and characterized by innovation, consolidation, and rapid, frequent
changes. Therefore, trends can develop or disappear quickly, putting pressure on the Company to permanently review and
potentially adjust its strategy. The Company is facing the typical risks and difficulties of technology companies in rapidly developing
and changing industries.
Market risk – Failure to respond to market trends
Specific risks
Risk response
Underlying technologies and advertising trends may
change rapidly leading to loss of competitive
positioning and revenue. Fyber's product launches and
enhancements may result in software products and
services which might not fully meet market demand or
customer expectations.
Changes in the fundamental dynamics of the ad tech
market's value chain and/or concentration trends
amongst advertisers and publishers may lead to direct
business relationships which bypass the Fyber platform
and thus make the business model obsolete.
We are closely monitoring market developments
Fyber has defined programs and processes to
support product innovation & build up a diversified,
stable product offering that can withstand changing
market environments (e.g. supporting different ad
formats, different buying mechanisms and publisher
tools)
Our system architecture is continuously being
improved to ramp up flexibility for adaptations
With the acquisitions in the last years, the Company
was able to strengthen its technology offering
Fyber has a track record of identifying market
changes early and investing into winning
technologies ahead of time, e.g. Fyber was first-to-
market to launch an innovative in-app header
bidding mechanism
Major players in the market such as the mobile
operators or the providers of application ecosystems
such as Apple and Google may decide to introduce ad
blockers to their systems and/or change their policies
to ban certain ad formats. These could potentially
seriously obstruct the delivery of ads to users of mobile
apps and thus harm the business of Fyber.
36
Annual Report 2020
Market risk – Dependence on app stores and exposure to intense competition
Specific risks
Risk response
Through its clients (app developers and mobile
publishers) Fyber is dependent on providers of app
ecosystems (e.g. Apple and Google as the providers of
their app stores). They may decide to change their
policies to ban certain ad formats or other services
offered by supply-side companies like Fyber or
introduce ad blockers.
We are keeping close contact with all major
providers to be informed early and proactively
understand the motivation of possible policy
changes and react accordingly to avoid or minimize
revenue impact
Fyber invested into its technology and product
offering and built out a competitive position as an
independent platform supporting publishers. We
assess this to be a meaningful value proposition and
work towards bringing and keeping technological
and product capabilities on par with the large
competitors and develop market reach and scale
necessary to compete more effectively
Continuous focus on profitability; Established a
stable, largely fixed cost base
The Company cannot exclude that specific changes
and new market dynamics might seriously obstruct the
delivery of ads to users of mobile apps and as a result,
substantially harm Fyber's results of operations, and
that similar market changes might occur in the future.
Moreover, the Company has a minor market share and
is exposed to intense competition dominated by
players such as Google, Facebook and Twitter, which in
many cases have greater financial capacity to execute
strategic acquisitions, invest in new technology, offer a
broader product portfolio and might compete for
customers.
If the Company fails to develop a technology platform
of significant capacity, grow the partner network and
transform into a profitable operation, the competitive
position and, as a result, the operating results of the
Company might be materially adversely affected.
37
Annual Report 2020
Market risk – External effects impacting the effectiveness of the Company’s product offering
Specific risks
Risk response
The group’s revenue growth depends on monetizing
apps through the placement of lucrative, meaningful
advertising while maintaining a positive user experience.
The Company operates under the assumption that the
usage of IDFA will be very limited after a broad
adoption of iOS14 due to estimated low opt-in rates.
Therefore, the risk response centers around identifying
and incorporating alternative metrics and processes to
ensure successful monetization in a post-IDFA
ecosystem:
In part, the Company processes personal user data on
behalf of the publisher to serve the users with targeted
advertising.
Apple announced in 2020, that the new operating
system iOS14 launched in Q4 2020 will include a
change in user data handling for the purpose of
tracking of all sorts starting from H1 2021. To date, the
tracking of user data for the purpose of serving
personalized ads is enabled by default for all installed
apps, generating a user identification for advertising or
IDFA. When using iOS14, users will be prompted with a
pop-up when using an app for the first time, asking the
user to allow tracking for purposes of advertising. After
the opt-in, the process of tracking and serving
personalized ads remains the same - meaning only the
manner in which the user consent is being generated
will be changed from a default granting to an active
opt-in by the user per app. Depending on opt-in rates,
this might impact the Company’s ability to serve
personalized ads using Apple’s IDFA.
Formed new specification summarizing contextual
data points that can be a viable replacement for
IDFA
Continuous support for demand-side platforms, as
they transition into placing their advertising under
the new system, enhancing their targeting
capabilities through contextual app targeting
Active testing of advertising targeting without using
IDFA ahead of the rollout of Apple’s changes
Engaging in active conversations with clients,
industry experts and other ad tech companies,
using their input to refine initial specifications on an
ongoing basis
Study Apple’s official technical documentation as it
becomes available, test the iOS14 beta version
including our approach to contextual app targeting
with leading demand partners
Refinancing risk – Failure to repay debt facilities
Specific risks
Risk response
Fyber is presently financed through, amongst other
facilities, a debt financing in the form of €72.7 million
convertible bonds (“Bonds”) and shareholder loans in
the aggregate amount of €32 million.
The refinancing risk of repaying the principal and the
aggregated interest poses a burden for the Company
and hinders its ability to access financing options on
the capital markets or attract new investors.
Management has taken significant steps to refinance
existing debt ahead of maturity:
Concluded voluntary debt-to-equity exchange of
€77.3 million worth of Bonds, more than halving the
original outstanding amount of €150 million worth
of Bonds
Delayed the maturity of the remaining Bonds
including all interest payments until July 2022
Delayed the maturity date of existing shareholder
loans with Tennor to June 2022 and March 2023
Moreover, the Company constantly monitors its
financial condition, results of operation and other
aspects relevant to covenants included in existing
financing agreements to ensure all covenants are met.
38
Annual Report 2020
In all of these fields, management addresses the risks by actively monitoring the developments and evaluating the actual
exposure to these risks. This includes participation in industry events, discussions with analysts, creating business cases for new
developments and securing required financing for at least 12 months on that basis. Matters of substantial significance are also
reviewed with the Supervisory Board through the two-tier board structure. In general, management’s risk appetite in this field is
low to medium with the potential impact being mostly high. Management sees the likelihood of the risks mostly medium.
39
Annual Report 2020
Operational risks
Fyber’s business depends on personnel, infrastructure, technology and customers.
In all of these areas lie operational risks that management permanently addresses:
Personnel risk – Failure to attract, develop, retain and motivate talent
Specific risks
Risk response
Our current and future performance is heavily bound
to the performance of individual contributors. It has
and will be key to identify and attract talent inside and
outside of the Company, to develop it to its full
potential and to retain it within the group. The small
candidate market within the ad tech industry as well
as long hiring cycles and unplanned fluctuation could
result in substantial delays in product development,
sales activities and revenue growth.
Providing attractive remuneration package and
comprehensive fringe benefits
Offering an employee stock option program to all
employees
Creating a positive working environment in
outstanding offices
Offering structured individual development plan
Global recruiting set up to identify and attract the
best talent on the market
Infrastructure risk – Failure to secure functioning of the IT infrastructure
Specific risks
Risk response
The Company’s success largely depends on the
continued and uninterrupted performance of its
information technology, network systems and certain
hardware / data centers.
Revenue is earned by delivering advertisements to
publishers’ applications through the Fyber platform.
Platform down-time would immediately reduce revenue
for the duration of the outage.
A catastrophic failure or disaster impacting the main
data centers may lead to a complete disruption, as the
group does not have a 1:1 replica of its server
infrastructure in another location at this point.
Regular backups
Redundant server structure for specific
components
Deployment infrastructure incl. configuration
management, orchestration and back up, allowing
for rapid recovery if needed
Moving to the cloud: the move to the cloud ensures
that the mediation layer services are running in
multiple cloud data centers (Frankfurt, N. Virginia).
This guarantees a stable provision of service even
if one regional data center fails
Insurance coverage of data center
Data centers have alternative power sources: since
power is a crucial prerequisite for running a data
center, our data center is equipped with redundant
power supply
As the Company does not have cross-region
redundancy, backup or recovery ability (multi-region
backup support), the delivery of uninterrupted
performance is dependent on stable, global internet
availability. Fyber’s service availability might be
impacted by large scale infrastructure failures, such as
DNS (‘Domain Name System’) provider issues, CDN
(‘Content Delivery Network’) issues or regional AWS
(‘Amazon Web Services’) problems.
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Annual Report 2020
Fraud risk – Failure to detect fraudulent activities
Specific risks
Risk response
The group may be subject to fraudulent and malicious
activities undertaken by persons seeking to use its
platform to divert or artificially inflate the purchase by
buyers through its platform, mainly fraudulently
generated advertising impressions overstating the
performance of advertising impressions. As we do not
own content, we rely in part on publishers for controls
with respect to such activities.
A dedicated anti-fraud is tasked with identifying
unusual patterns ideally already in the design
phase of advertising campaigns or during the
initial use after the launch of each campaign
Use of proprietary and external technology to
identify non-human ad inventory and traffic
Assessing the quality and performance of
advertising on publishers’ properties
If fraudulent or other malicious activity is perpetrated
by others, and the group fails to detect or prevent it, the
affected advertisers may experience or perceive a
reduced return on their investment resulting in
dissatisfaction with the group’s solution, refusals to pay,
refund demands or loss of confidence of advertisers or
publishers and ultimately withdrawal of future business.
More generally, as a company operating in digital
advertising which provides products online and delivers
software solutions via the cloud, Fyber is also exposed
to cybersecurity attacks of varying degrees, including
virtual attacks, disruption, unauthorized access, theft,
destruction, espionage, misuse or abuse of data,
disruptions to back-up etc.
Constantly improving our processes for assessing,
detecting and controlling fraudulent activity
Completed investment into end-to-end encryption
of hardware used by employees to fend off
cybersecurity attacks
Technology risk – Failure to develop and implement the unified product roadmap
Specific risks
Risk response
The group’s revenue growth depends largely on the
ability to develop a reliable, scalable, secure, high-
performance technology infrastructure that meets
current market needs. The markets in which Fyber
operates are characterized by rapidly changing
technology and developments. In addition to that the
group is unifying their ad tech platforms into one global
unified platform.
Focused on continuous improvement of the
Company’s product offerings, bringing new innovative
technologies to the market and taking advantage of
the integrated product offering. In 2019 important
product launches and improvements of existing
technology included:
Release of new version of core product Fyber
FairBid, Fyber’s holistic publisher monetization
platform including app bidding capabilities
Further investments into the video ad capabilities
of our programmatic ad exchange Fyber
Marketplace
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Annual Report 2020
Technology risk – Open source software programs
Specific risks
Risk response
The group’s products rely on third-party open source
software components. The use of open source software
may bear the risk that certain licenses could be
construed in a way that could impose unanticipated
conditions or restrictions to the group. In addition, new
products and services including third-party
technologies, might not comply with local standards
and requirements or could contain undetected or
detected coding errors or defects or could not be
mature enough from the customer's point of view,
despite all the due diligence efforts which Fyber
dedicates to product quality.
The use of open source software is monitored in
part by the responsible engineering managers,
supported by externals tools
In addition, a formalized process to regulate and
monitor the usage of open source software
throughout the group has been developed by the
Fyber security department
If the group is held to have breached the terms of an
open source software license, it could be required to
discontinue use of certain code, or to make portions of
its proprietary code generally available.
Any of these actions could have a material and adverse
effect on the group’s business, reputation and operating
results.
In addition to the measures already described above, operational risks are furthermore managed through the ongoing budgeting,
forecasting and reporting process as well as training activities to constantly improve and update the employees’ skills.
Management generally considers the likelihood of risks in the operational and technology area as medium while evaluating the
financial impact of each event as low to high depending on the specific risk field. Management’s risk appetite in this field is low
to medium and we seek to mitigate risks through contracts, service level agreements, insurances and cooperations with
established partners.
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Annual Report 2020
Financial risks
In the course of its ordinary business, Fyber is exposed to treasury risks and other financial risks including liquidity risk,
currency risk and credit risk.
Currency risk – Failure to combat unfavorable movements in foreign currencies
Specific risks
Risk response
The group’s reporting currency is the Euro (EUR) which
is also the functional currency of Fyber. It is exposed to
exchange rate risks, particularly with respect to
transactions in foreign currencies arising mainly from
the relative value of the EUR compared to the value of
the US Dollar (USD). The majority of the Company’s
revenue is generated in USD. The group is therefore
significantly exposed to currency fluctuations between
the USD and EUR.
Management seeks to minimize these risks through
natural hedging by increasing its cost base in USD
Refinancing is partly done in USD, e.g. USD 12
million loan from Bank Leumi and USD 10 million
loan from Discount Bank has deliberately been
secured in USD
No other hedging or option strategy is applied
Unfavorable foreign currency movements such as a
weakening of the USD may lead to a reduction of
income as USD denominated revenue exceeds USD
denominated cost. The timing and extent of currency
fluctuations may be difficult to predict. Furthermore,
the Company may be adversely affected at a time
when the same currency movements benefit some of
the Company's competitors.
For additional information, please refer to the Notes
to the Financial Statements.
Working capital risk – Seasonality of advertiser spending
Specific risks
Risk response
The group’s results of operations and cash flows vary
from quarter to quarter due to the seasonal nature of
advertising spending, with the fourth quarter typically
being the strongest in terms of advertising spend. This
affects the group’s results of operations, cash flows and
cash requirements. In addition, digital advertising
spend is volatile and unpredictable. As a result, in times
of lower than expected advertising spend the group’s
revenue may be materially adversely affected.
Closely monitoring and actively managing working
capital and cash flow
Permanent review process in connection with
monthly results, forecasting and budgeting
Regular short-term and long- term cash forecasts
during the year which the Treasury team use to
manage cash resources effectively
Securing excess contingency funds through banks
or other financing partners
Also, uncertainty and fluctuations of revenue streams
may cause situations where Fyber identifies the need
for additional financing due to revenue decreases only
on short notice.
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Annual Report 2020
Credit risk – Pre-financing substantial part of our revenue
Specific risks
Risk response
Fyber charges the advertisers for the gross advertising
value delivered to publishers. Typical payment terms
with advertisers are 30 days after invoice but can be
60 days or longer. In addition, the group typically
experiences slow payment by advertisers as is common
in the industry. Typical payment terms with publishers
are between 30 and 45 days. As a consequence, Fyber
may pay the publishers before it collects money from
advertisers.
Since the Company has contractual relationships with
publishers and advertisers independently, the group is
exposed to credit risk. Advertisers may pay late or not
at all.
Permanent review process in connection with
monthly results, forecasting and budgeting
Closely monitoring and actively managing working
capital and cash flow
KYC procedures
Strict approval process for any deviation in
payment terms in place
General terms & conditions provide for a right to
withhold payments from publishers if the
underlying advertisers have not paid
Financing risk – Failure to secure financing and exposure to liquidity risk
Specific risks
Risk response
The Company requires capital to cover its financial
liabilities, current operations and planned expansion of
business. These cash and cash equivalents are
generated partly through ongoing business activity and
partly through external financing.
Management has taken significant steps to reduce
the cash needs of the group by reducing the cost
base, realizing synergies stemming from the
integration of former group companies and
installing a tight ongoing cash flow monitoring
The Company is constantly screening the market
for additional financing options and attracting new
capital to either add additional financing if
needed, or enhance the existing capital structure
The general meeting of shareholders has granted
authority to the Management Board to issue new
shares up to 15% of issued capital in order to
ensure continuing flexibility with regard to the
financing of the Company and attracting new
capital
Liquidity risks stemming from the lack of access to
capital can occur when credit facility agreements or
shareholder loans are called off, cancelled, reduced or
not extended, or budgeted revenue growth numbers
cannot be met.
While the Company generated positive cash flow from
operations for the full year 2020, it accrued significant
losses in past periods, and continues to invest in sales,
marketing, product and technology development in
order to lay the foundation for future intended growth
and profitability with expenses made before earning
adequate revenue. Therefore, Fyber may need
additional capital in the future to pursue its business
objectives. This may not be available on favorable
terms, or at all, which could comprise the group’s ability
to meet its financial obligations and support its
forecasted business growth.
Positive cash flow from operating activities
generated for the first time for the full year 2020,
amounting to €10.4 million
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Annual Report 2020
Financing risk – Dependence on major creditor
Specific risks
Risk response
Tennor is a major creditor and controlling shareholder
of the Company. Therefore, Fyber is exposed to
Tennor's credit risk and its ability and willingness to fulfil
its obligations vis-à-vis the Company. In particular, the
Company entered into shareholder loans with Tennor
with an aggregated principal amount of €32 million.
If Tennor is not able or willing to fulfil its respective
obligations vis-à-vis the Company, this would have a
severe adverse effect on the Company's financial
condition and may cause insolvency.
The Company maintains a very good, constructive
and trustful working relationship with the major
shareholder
Two representatives of the major shareholder are
members of the Company’s Supervisory Board,
ensuring supervision of management and financial
processes
The past track record shows that all obligations
vis-à-vis the Company have been fulfilled
The shareholding position also reflects, that the
goal of building and maintaining a stable,
profitable operation that caters to long-term value
creation is a shared goal between the Company
and the major shareholder
Financing risk – Exposure due to pledging of significant part of assets
Specific risks
Risk response
The Company has pledged significant assets as
collateral for financing and operating contracts,
namely the Company's shares in all its operating
subsidiaries, material parts of their intellectual property,
as well as major parts of their existing and future trade
receivables.
There is a risk that additional financing measures or
the extension of existing financing agreements will not
be possible due to a lack of available collateral. This
could have a negative impact on the net assets,
financial position and results of operations of the
Group and the Company.
The Company set up a balanced financing
structure consisting of straight debt facilities,
shareholder loans and convertible bonds. The
attribution of pledge assets was done
considerately and diligently
The Company assumes that current outside
financing is sufficient to fulfill present growth plans.
Should the need arise to add or restructure
financing, a possible reattribution of assets would
be considered ahead of time
For example, in 2020, the Company agreed with
Bank Leumi to extend its revolving credit facility
until the end of December 2021 and reduce the
maximum amount of the facility from $15 million to
$12.5 million At the same time, an additional loan
facility was secured with Discount Bank amounting
to $10 million without the requirement to pledge
additional assets.
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Annual Report 2020
Impairment risk – Failure to meet initial expectation
Specific risks
Risk response
The group has considerable financial and non-financial
assets, copyrights and other intellectual property.
Critical changes in market conditions, and therefore in
the group’s assumptions, could result in a change to
the estimated recoverable value and therefore in an
impairment charge to the goodwill or other intangible
assets.
Continuous monitoring of market conditions and
business performance to identify any negative
variations against initial assumptions underlying
the valuation of intangibles
Managing towards budgets and business cases
Ongoing investments into developing our
technology further, updating existing products or
releasing new features that meet new or changed
market demands
Monitoring risk – Threats to the Company’s going concern assumption
Specific risks
Risk response
The Company may be unable to identify threats to the
going concern assumption in a timely manner or at all.
Even though risk management systems are in place, it
cannot be ruled out that critical risks are only identified
at a time when reaction and mending are difficult or
impossible.
This is of particular importance as the Company
operates in a fast-paced, rapidly evolving industry, with
many of the key products still young to the market and
being shaped among others by business and client
needs as well as regulatory changes and changes in
user behavior.
Risk management and monitoring system in place,
aiming to identify as early as possible any
developments that might jeopardize the going
concern of the Company
Development of appropriate internal
organizational, risk monitoring and risk
management structures that enable the Company
to identify undesirable developments and risks at
an early stage
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Annual Report 2020
Capital risk – Volatility of share price and risk of dilution
Specific risks
Risk response
The market price of the Company's Shares has been
very volatile in the past. It cannot be ruled out that the
market price of the Company's Shares will be subject
to major fluctuations in the future, which are not
necessarily related to the Company's business
performance. A low share price may lead to inability to
attract strong long-term investors and limits the ability
to raise new equity and attract key personnel.
Furthermore, the Company may seek to raise capital in
the future through equity or hybrid securities. An
issuance of additional equity could potentially reduce
the market price of the Company's shares and would
dilute the economic and voting rights of the Company's
existing shareholders.
Regular debt-to-equity swaps of the convertible
bonds improve the Company’s capital structure
and increase the liquidity of the stock
Ongoing investor contact and outreach to interest
potential new investor in Fyber to increase trading
liquidity
Management addresses the financial risks mainly through close controlling and the permanent review process in connection with
monthly results, forecasting and budgeting. Matters of substantial significance are also reviewed with the Supervisory Board
through the two-tier board structure. Management realizes that the expansion of the business requires some risk taking and
evaluates its risk appetite as medium. The group continues to be dependent on additional liquidity to fund its growth and the risk
of not finding these funds is always present. In addition, the Company faces the refinancing risk of its debt (convertible bonds,
straight debt bank facilities, shareholder loans), which matures partly in 2021 and partly in 2022. Due to the significant out-
standing amounts and the Company’s current position of negative operating cash flow, management estimates this risk to be
high. Should the risk materialize, it would have a very high, potentially critical impact for the going concern assumption. This
material uncertainty is also further disclosed in the financial statements. Management takes this risk very seriously and therefore
constantly reviews capital needs and seeks to secure additional funds rather early.
47
Annual Report 2020
Compliance risks
Fyber is exposed to non-compliance risk based on various laws and regulations in different countries.
The compliance strategy of Fyber is crafted with the view to ensuring consistency between the conduct of its business operations
and the ongoing observance of relevant laws, rules and standards of good market practices. The aim is to shield the organization
from legal and regulatory sanction, financial or reputation losses.
Compliance risk – Failure to comply with relevant laws and regulations
Specific risks
Risk response
The Company operates globally and currently markets
its products and services in more than 180 countries
worldwide. The international business activities and
processes expose the Company to numerous and often
conflicting laws and regulations, policies, standards, or
other requirements covering a wide variety of subject
matters. As the Company expands into new countries
and markets or extends its business activities in these
markets, including emerging and high-risk markets,
these risks could intensify.
We have processes in place and provide guidance
to our employees through guidelines and policies
(e.g. code of conduct and insider trading
regulations)
We mitigate the risk by working with well-
established external partners such as tax, legal and
audit advisors in all countries we are operating, as
well as building in-house capabilities through
training and qualification measures for existing
staff
New laws and regulations or new interpretations of
existing laws and regulations may also negatively
impact our business.
The cost of compliance with these laws and regulations
are high and are likely to increase in future. Non-
compliance could result in the imposition of potentially
material penalties and/or sanctions against the
Company.
We are paying continuous attention to the latest
developments as regards related laws and
regulations, accurately understanding their impact
and coming up with the necessary responses to
guarantee that the group addresses the risks
arising from such changes
Compliance risk – Potential conflict of interest between major shareholder and other shareholders
Specific risks
Risk response
It cannot be excluded that the interests of the major
shareholder may conflict with the interests of other
shareholders or the interests of the Company.
Depending on the presence at the general shareholder
meeting of the Company, the major Shareholder could
block major decisions requiring a three-quarters
majority without the consent of other shareholders,
including amendments to the articles of association,
corporate actions and mergers, liquidation or a
squeeze-out of other shareholders. Conflicts of interest
between the major shareholder and the Company or
its other shareholders may have a material adverse
effect on Fyber.
The Company maintains a constructive working
relationship with the major shareholder and other
shareholders and thereby identifies and undertakes
measures to prevent already at an early stage
potential conflict of interests between the major
shareholder and other shareholders
It is one of the key principles of the Management
Board to adhere to all relevant legal and
governance standards to ensure acting in the best
interest of the Company and all its shareholders,
including minority shareholders
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Annual Report 2020
Data risk – Failure to comply with increasing data security regulations
Specific risks
Risk response
Fyber collects, stores, processes and uses data in the
ordinary course of business to provide its services to
customers. The correct use of data, ensuring its
integrity and security as well as adhering to all data
protection laws and regulations applicable to the
Company are imperative to the Company's business
operations and reputation.
In order to respond to the increasing efforts to
process, store, protect and use personal data in
compliance with governmental regulations,
contractual obligations and other obligations related
to privacy and security, the following measures have
been implemented:
It may not be possible to prevent cases of data
leakage or the misuse of data as a result of human
error, technological failure or other factors outside of
the Company's control.
Investments into product and technology and
revision of client contracts to ensure business
activities and product features adhere to various
data usage regulations currently known
External Data Security Officer appointed; further
external advisors are available where needed
A designated project team within the Company
has been created to advise and coordinate group-
wide and to govern data compliance in all sectors
Analysis of existing contractual relationships and
update of agreements
Furthermore, the Company may be subject to local
data protection laws and regulations, taking effect on
the Company's products, services and customer data
handling, potentially limiting the effectiveness of
serving meaningful ads to users and with that the
Company's revenue potential.
Specifically, the Company is subject to the EU's General
Data Protection Regulation (EU 2016/679) ("GDPR"),
which took effect in May 2018 and regulates data
protection for users within the European Economic
Area (EEA) as well as the California Consumer Privacy
Act of 2018 ("CCPA") which took effect in January 2020,
regulating privacy and data protection for residents of
California.
Monitoring of changes in governing laws and
regulations and assessment in regards to the
business
Creation of inter- and intra-company workgroups
and training of personnel
Any limitations imposed by stricter interpretation of the
existing requirements or by future modifications of the
data protection laws could have a significant impact
on the Company's business operations and the
Company's ability to market its products.
Violations of regulations may lead to damage claims,
fines and harm to the Company's reputation, thus
materially adversely affecting its business activities, net
assets, financial position and results of operations.
As the group is growing fast in a complex environment and is still in the process of establishing and improving its processes,
regulatory violations may occur. Management's risk appetite is low and it estimates the impact of possible violations low to
medium.
49
Annual Report 2020
Remuneration Report
The 2020 Remuneration Report has been prepared by the
This Remuneration Report contains:
remuneration & organization committee of the Supervisory
Board of Fyber N.V. (the “Remuneration Committee”) in
accordance with the Dutch Civil Code (article art 2:135b)
and the Dutch Corporate Governance Code (the “Code”).
Activities of the Remuneration Committee in 2020
Remuneration of the Management Board and
implementation of the Remuneration Policy in 2020
Since this Remuneration Report forms an integrated part of
the Annual Report, reference is made to the introductory
section above for a summary of the financial year 2020.
Internal pay ratio and 5-year analysis
Performance of the Managing Directors in 2020
Share Options awarded to Management Board
Remuneration of the Supervisory Board
The Remuneration Committee has been appointed by the
Supervisory Board in its meeting on 30 January 2020.
During the first meeting of the Remuneration Committee on
27 February 2020, Yair Safrai was elected chairman of the
committee.
Further information on the remuneration and on option
ownership of members of the Management Board and
members of the Supervisory Board is available in Note 41
of the Notes to the Consolidated Financial Statements. The
Remuneration Policy and the Charter of the Remuneration
Committee are posted on Fyber’s website.
The Remuneration Committee is comprised as follows:
Remuneration & Organization Committee
Yair Safrai (chairman)
Tarek Malak
The very high level of support (100%) from present share-
holders on the revised Remuneration Policy at Fyber’s 2020
AGM and the affirmative vote on the 2019 Remuneration
Report was taken into account by the Remuneration
Committee when drafting this 2020 Remuneration Report.
The Committee also took note of the views of the individual
Managing Directors on their remuneration.
Franklin Rios
The duties of the Remuneration Committee are, among
others, to make proposals to the Supervisory Board
This 2020 Remuneration Report will be submitted to an advi-
sory vote at the 2021 AGM to render account for the execu-
tion of the Remuneration Policy in 2020. The Remuneration
Committee will take into account the results of the advisory
vote and report on this in next years’ remuneration report.
concerning the remuneration of individual members of the
Management Board and Supervisory Board, to monitor the
effectiveness and relevance of the remuneration policy
throughout the year and to consider the extent to which the
individual remuneration packages of the Management
Board members were in line with the Remuneration Policy.
Activities of the Remuneration
Committee in 2020
The key activities of the Remuneration Committee this
year were negotiating the terms of the reappointment
of the Management Board members and the review of
the remuneration policy in light of the new requirements
under the revised European Shareholder Rights Directive II
(‘SRD II’).
Review of Remuneration Policy
On 1 December 2019, the SRD II was implemented into
Dutch law, introducing new rules on director remuneration,
which apply to the remuneration of both the Management
Board and the Supervisory Board. In order to comply with
these new requirements, the Remuneration Committee
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Annual Report 2020
reviewed the remuneration policy for the Management
Board and drew up a remuneration policy for the
Supervisory Board (as one combined document, the
“Remuneration Policy”). The Remuneration Policy was
endorsed by the Supervisory Board on 28 April 2020 and
adopted by the annual General Meeting on 11 June 2020.
The Remuneration Policy takes (retro-active) effect from 1
January 2020 and remains in place until a new or revised
policy has been adopted by the General Meeting of
shareholders in accordance with the applicable
requirements of the Dutch Civil Code.
additional incentive bonus structure, were resolved by the
Remuneration Committee in its meeting on 3 December
2020 and approved by the Supervisory Board on 7
December 2020. The Supervisory Board acknowledges that
Ziv Elul’s bonus agreement is subject to the condition
precedent that the Company’s AGM in June 2021 approves
the revision of the Remuneration Policy to the effect that it
permits the incentive bonus.
Performance of the Management Board
The Supervisory Board discussed the individual Management
Board members’ views regarding the amount and structure of
their own remuneration and asked the members of the
Management Board to pay attention to the aspects referred
to in best practice provision 3.1.2 of the Code.
Compared to the former remuneration policy, which was
adopted at the annual General Meeting on 30 June 2014,
there are no significant changes except that the policy is
extended to include the disclosure requirements pursuant to
the Dutch Act implementing the SRD II, including a
remuneration policy for the Supervisory Board.
The performance of the Management Board as a whole and
its individual members were discussed by the Supervisory
Board during its meetings held on 30 January 2020 and 16
April 2020, together with the performance appraisal and
bonus computation for the preceding year, the performance
goals of the Management Board for 2020 as well as the
remuneration of the Management Board for 2020.
The objective of Fyber’s Remuneration Policy is to attract,
motivate and retain the qualified individuals needed to
achieve its strategic and operational goals. The
Remuneration Policy is clear and understandable, focuses
on long-term value creation for the group, and takes into
account the internal pay ratios within the Company. The full
policy can be found on the Company’s website.
The Supervisory Board, upon proposal of the Remuneration
Committee, agreed on the key performance indicators
(“KPIs”) and weighting levels set for the performance-based
remuneration of the Management Board, and periodically
reviewed the progress on the achievement of these KPIs. A
scenario analysis was carried out within the terms of the
Code to evaluate the variable components of the
remuneration packages of the Management Board
members. Reference is made to the chapter “Performance
of the Managing Directors” below.
Reappointment of Management Board
The term of appointment of all three Management Board
members, Ziv Elul, Daniel Sztern and Yaron Zaltsman, was
expiring at the end of the annual General Meeting 2020.
The Supervisory Board nominated all three directors for
reappointment as members of the Management Board
under due consideration of the articles of association of
the Company and the Dutch Corporate Governance Code,
which have been approved by the AGM on 11 June 2020.
Peer group analysis
The objectives set by the Supervisory Board for the
members of the Management Board are in line with
executive remuneration throughout the advertising
technology industry, that is, to focus on improving the
performance of the Company and its long-term value, to
motivate and retain board members, and to be able to
attract other highly qualified executives, when required. In
order to compete for talent, the Supervisory Board
identified a peer group of other ad tech companies for
The contract renewal of the Managing Directors and their
individual remuneration has been negotiated by the
Remuneration Committee in accordance with the
Remuneration Policy. The Supervisory Board approved the
contract amendments of Mr. Daniel Sztern and Mr. Yaron
Zaltsman in its meeting on 16 April 2020 upon proposal by
the Remuneration Committee. The contract amendments of
Mr. Ziv Elul, CEO of the Company, which include an
51
Annual Report 2020
remuneration benchmarking purposes in 2020 to align the
components, set to ensure retention in line with market
standards, which account for individual and the Company's
performance and may consist of the components described
below. The table describes the Management Board’s
remuneration and how the Remuneration Policy was
implemented in 2020.
Management Board’s remuneration levels closer to
equivalent positions in the market. These peer companies
are either business competitors, other technology in the ad
tech ecosystem or companies Fyber competes with for
executive talent. The peer group predominantly consists of
US or Israel-based companies of comparable size,
complexity and international scope. Annual changes to the
peer group can be made by the Supervisory Board.
Remuneration elements
Base salary
Remuneration of the Management Board
and implementation of the Remuneration
Policy in 2020
Short-term incentive plan
Long-term incentive plan
Pension schemes
The Supervisory Board determines the remuneration of the
Management Board members, in accordance with the
Remuneration Policy. Pursuant to the policy, Managing
Directors are remunerated via customary salary
Other benefits
Severance payments
Base salary
Purpose and
To attract and retain individuals with the requisite level of knowledge, skills and experience.
link to strategy
Operation
Base salary is generally set for the length of the Managing Director’s term taking into consideration a variety of factors,
for example:
The scope of the role, responsibility and seniority of the Managing Director with reference to market practice
Performance of the group and the individual
Remuneration of the Company’s external peer group
Internal pay ratios and employment conditions of the employees within the organization
The base salary of each Managing Director is a fixed cash compensation paid on a monthly basis and is based on a
function-related pay system. The Supervisory Board at its sole discretion will decide if and to what extent the base pay
will be amended and the criteria for such amendment.
Implementation of
the Remuneration
Policy in 2020
The Supervisory Board determined the remuneration of the Management Board members, upon proposal by the
Remuneration Committee, in accordance with the Remuneration Policy during its meetings held on 30 January 2020 and
16 April 2020.
The base salary and target amount of the annual bonus of the Management Board members were originally set in the
Supervisory Board meeting on 7 June 2017 and remained unchanged until the date of this report.
The base salary is stipulated in the Managing Director’s employment agreements with the local subsidiary and paid on a
monthly basis in NIS with a fixed exchange rate.
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Annual Report 2020
Short-term incentive plan
Purpose and
link to strategy
To incentivize and reward performance against achievement of certain performance indicators set out in the annual
business plan.
Operation
The Managing Director’s remuneration package includes a significant variable part in the form of an annual bonus
incentive, ranging between 40% to 50% of the total annual salary. The incentive is based on the Company’s performance
against the targets of the respective financial year and is generally paid in cash.
Performance measures, weightings and targets for the selected measures are set annually at or before the beginning of the
year (and when needed adjusted) by the Supervisory Board to ensure they continue to support Fyber’s short-term business
strategy. These performance targets include criteria reflecting the Company's financial performance derived from the
group’s annual business plan and may as well include quantitative and/or qualitative criteria related to the Company’s
and/or individual performance. Qualitative criteria may include the adherence to the company values the group set out for
itself. Fyber defined a set of joined, equally important values that best express its focus on technological leadership through
innovation, long-term value creation and establishing a fair, inspiring work environment for all employees.
Performance metrics and weights are disclosed retrospectively in the annual remuneration report.
Short-term incentives are subject to clawback.
Minimum pay-out is 0% of the target bonus. Maximum pay-out is 150% of the target bonus (in the case of above target
performance only).
The Supervisory Board can, at its discretion and only in the event of special circumstances, decide to adjust the variable
remuneration.
Implementation of
the Remuneration
Policy in 2020
The remuneration package of Managing Directors included a significant variable part in the form of an annual cash bonus.
The target bonus remained unchanged after the reappointment in 2020.
The performance conditions for members of the Management Board for 2020 have been set in the Supervisory Board
meeting on 16 April 2020 and are linked to financial performance parameters of the Company (100% weighting). The
maximum opportunity remained at 150% of the target bonus.
The annual bonus is stipulated in the Managing Directors individual contract with Fyber. Payment is to be made in two
installments: 75% of the bonus is to be paid in the first quarter of 2021, and the remaining 25% after publication of the
2020 annual financial statements. The annual bonus is paid in NIS using the exchange rate on the day of the payment.
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Annual Report 2020
Long-term incentive plan
Purpose and
To reward the sustainable long-term performance, aligning the directors’ interest with those of shareholders.
link to strategy
Operation
The Company uses an employee stock option plan (‘SOP’) as a long-term incentive for Managing Directors and employees.
The SOP has been installed with the intention to drive sustainable performance, to foster alignment of interests of the
participants with shareholders and to attract and retain key talent to the Company.
The SOP was originally approved by the extraordinary General Meeting (“EGM”) held on 1 April 2015 and amended in the
2016 annual General Meeting (“AGM”) to accommodate the increase in the number of persons who are eligible to
participate in the SOP, as a consequence of organic growth and acquisitions. The SOP was again amended and restated
by the Supervisory Board upon recommendation of the Remuneration Committee and approved by the EGM held on 11
April 2017 to facilitate a net exercise of stock options by participants in the SOP, whereby a portion of the shares allotted
may be withheld by the Company on behalf of the participant in the SOP in order to cover the participant's cost to
exercise the options.
Under the SOP, the Managing Directors will be awarded a conditional right to receive shares in the capital of the Company
(the ‘Shares’). A Managing Director will in principle only receive the awarded Shares after a predetermined vesting period
(generally three years) following the date of grant and if certain performance conditions (which may be both financial and
non-financial criteria) as determined by the Supervisory Board are met.
The target value of awards to be granted under the SOP (i.e. the number of Shares comprising the award) differentiates per
role and is determined on an annual basis in individual award letters subject to approval by the Supervisory Board.
Any material changes to the SOP regarding the Managing Directors require approval of the General Meeting. Any other
amendments require prior approval of the Supervisory Board. In addition, the Supervisory Board has certain discretionary
powers under the SOP, including to determine the number of shares that will continue to vest upon termination of
employment.
Long-term incentives are subject to clawback.
The maximum number of options that may be granted to Managing Directors is stipulated in the SOP.
Implementation of
the Remuneration
Policy in 2020
In the course of the reappointment, the Management Board members were granted further options for the service period
2020 until 2024 by resolution of the Supervisory Board dated 16 April 2020, to underline the focus on Fyber’s long-term-
value creation. The total of options granted to Managing Directors are outlined in the table “Share options awarded to
Managing Directors“ below.
Additional options shall be granted to the Management Board in case of a conversion of the remaining convertible bonds
to compensate for the dilution effect of the capital increase in accordance with article 14 of the SOP. The exercise price
shall be set based on the conversion price of the convertible bonds and vest over the remaining period of the Management
Board’s term (until the AGM 2024). In case of termination without cause, an accelerated vesting shall apply to unvested
options. Those shall vest over the next 12 months and the exercise period shall be extended from 90 days until the end of
the vesting period, in accordance with article 7.5 (ii) of the SOP.
As of 31 December 2020, a total of 25,741,850 subscription rights to the Company’s shares (2019: 22,985,139) have been
issued to the Company’s employees, and additional 25,493,983 (2019: 19,740,000 options) have been issued to the members
of the Management Board. The weighted average exercise price as of 31 December 2020 amounted to €0.26 (2019: €0.23).
No ordinary shares have been awarded to members of the Management Board.
54
Annual Report 2020
Pension schemes
Purpose and
To provide retirement benefits aligned with local country practice.
link to strategy
Operation
Pension arrangements reflect the relevant market practice and may evolve year-on-year. The Managing Directors may
participate in the applicable pension programs available to other executives in the country of employment. Details on the
pension arrangements in place are included in the annual remuneration report.
Implementation of
the Remuneration
Policy in 2020
There are no special pension arrangements for Managing Directors, other than the Israeli specific pension fund mentioned
below.
Other benefits
Purpose and
To provide a competitive level of benefits and to support recruitment and retention.
link to strategy
Operation
Benefits will be provided in line with local market practice in the country of employment and may evolve year-on-year.
Benefits may include for example a company car (or cash equivalent), risk benefits (for example life and disability
insurance) and employer contributions to insurance plans (for example medical insurance). Additional bene ts and
allowances may be offered in certain circumstances such as relocation support, expatriate allowances, temporary living
and transportation expenses.
Implementation of
the Remuneration
Policy in 2020
Ziv Elul, Daniel Sztern and Yaron Zaltsman are entitled to benefits according to the Israeli provisions of the ‘General
Approval of the Minister of Labor and Social Welfare Regarding Payments by Employers to a Pension Fund and Insurance
Fund in lieu of Severance Pay’ with a monthly employer contribution of up to 17.3% of the base salary and the Education
Fund (‘Keren Hishtalmut’) short-term savings plan with a monthly employer contribution of 7.5% of the base salary. In
addition, the Management Board members are entitled to car allowances. Ziv Elul is furthermore entitled to full
membership of the ‘Young Presidents Organization’.
For details on other benefits to members of the Management Board please refer to Note 41 of the Notes to the
Consolidated Financial Statements.
Severance Payments
Purpose and
To compensate for the loss of income in case of termination without cause by the Company.
link to strategy
Operation
Severance payments are payable in accordance with relevant employment laws of each group entity. In line with best-
practice provision 3.2.3 of the Code, the maximum severance payment to Managing Directors may amount equal to 100%
of annual base salary.
Implementation of
the Remuneration
Policy in 2020
The arrangements with the current Management Board members contain provisions for severance payments in the event
that their agreement is terminated as a result of a merger or takeover. These arrangements do not exceed one year’s fixed
remuneration.
55
Annual Report 2020
Furthermore Ziv Elul is entitled to an incentive bonus in the
agreement with the local subsidiary of Fyber N.V. (the
“Agreement”). The Agreement may be terminated by either
party at any time in writing with a notice period of three
months unless termination for cause.
event of certain capital measures and/or in case of a future
merger or takeover. This mechanism has been resolved by
the Remuneration Committee in its meeting on 3 December
2020 and approved by the Supervisory Board on 7
December 2020. With regard to the long-term value
creation of the Company and Ziv Elu’s role and
responsibilities in this matter, the Supervisory Board sees a
legitimate interest of the Company for this decision. The
Supervisory Board acknowledges that Ziv Elul’s special
bonus agreement is subject to the condition precedent that
the Company’s AGM in June 2021 approves the revision of
the Remuneration Policy to the effect that it permits the
incentive bonus.
The Supervisory Board has taken appropriate steps to
ensure the arrangements of Management Board members
are in line with the Remuneration Policy. However, Mr. Ziv
Elul will be entitled to an incentive bonus in the event of
certain capital measures and/or in case of a future merger
or takeover. The Supervisory Board will, upon proposal of
the Remuneration Committee, propose to the annual
General Meeting of shareholders in 2021 a respective
amendment of the Remuneration Policy.
Terms of engagement
In accordance with best practice provision 3.4.2 of the Code
the main elements of the contracts of the Management
Board members are published on the Company’s website,
as well as in the Remuneration Report (as part of the Annual
Report).
Members of the Executive Board are appointed for four
years and may then be re-appointed for successive
mandates also for a period of four years. All three
Management Board members have an employment
Annual remuneration of Management Board members 2020
Fixed
remuneration
Variable
remuneration*
Proportion of fixed/variable
remuneration*
Total
remuneration*
in € thousands
2020
2019
2020
2019
2020
2019
300
300
250
250
250
250
300
300
175
175
50/50
50/50
59/41
59/41
59/41
59/41
600
600
425
425
425
425
Ziv Elul,
CEO
Daniel Sztern,
Deputy CEO
175
175
Yaron Zaltsman,
CFO
*Note: in case of achievement of 100% of the performance targets per year
For further details on the Managing Director’s actual total
remuneration in 2020 please refer to Note 41 of the Notes to
the Consolidated Financial Statements.
and/or one-off payments. The average remuneration of the
FTE is calculated as the total remuneration of all FTEs
globally (excluding Managing Directors), divided by the
average number of Fyber employees on an FTE basis. For
Ziv Elul (who was appointed CEO as of 25 July 2017), the
fixed and variable remuneration was annualized for the year
2017 in the table to facilitate comparison.
The ratio between the CEO's remuneration and the average
remuneration of employees was 7 to 1 for the full year 2020.
The increase in the ratio compared with 2019 is based on
higher target achievement for variable remuneration in
2020, with variable pay for managing directors accounting
for a larger share than that of the average global workforce.
Pay ratio and five years performance overview
The Code requires Fyber to report on the pay ratio within
the Company. The pay ratio used by Fyber reflects the
average compensation of the global employee workforce of
Fyber on a full-time equivalent (‘FTE’) basis, relative to the
remuneration of the CEO of the Company. The remuneration
of the CEO and FTE is calculated using the actual fixed and
variable remuneration of the respective year excluding
social security cost, any other remuneration components
56
Annual Report 2020
The following table shows the pay ratio and the Company
performance over the last five years based on selected KPIs.
evaluation 2020 are based on the Company’s performance,
have been set in the Supervisory Board meeting on 16 April
2020 and are detailed in the table below.
The development of these ratios was affected by acquisitions,
integrations, and changes of Managing Directors over the
last five years as well as company performance and will be
monitored and disclosed going forward.
The three performance criteria, namely revenue, net revenue
and adjusted EBITDA have to be achieved in order to be
eligible for payout of the annual bonus, whereas minimum
payment is 0% of the target bonus and maximum payment
is capped at 150% of the target bonus (in the case of
overachievement). The bonus amount is calculated based
on the performance against the revenue target only, subject
to the achievement of all three thresholds.
Performance of the Managing Directors in 2020
The remuneration package of Managing Directors includes
a significant variable part in the form of an annual cash
bonus. The performance targets 2020 for the bonus
Pay ratio
2020
2019
2018
2017
2016
in € thousands
Ziv Elul, CEO
750
0
510
0
300
600
0
0
353
Andreas Bodczek, former CEO
Average salary FTE
Internal pay ratio
Revenue
0
83
92
84
84
91
7 to 1
6 to 1
118,973
19,395
(2,717)
4 to 1
128,544
22,972
(7,247)
7 to 1
4 to 1
209,722
30,496
5,620
229,832
42,735
(1,154)
176,786
41,325
(4,285)
Gross profit
Adjusted EBITDA*
* Note: adjusted EBITDA is excluding one-off impacts such as impairment of goodwill, acquisition related costs and option plans and is not a measure
calculated in accordance with IFRS. For further details on the adjustment please refer to the ‘Business Performance’ sections of the respective annual
reports.
** Note: this was categorized as net revenue in 2015, as the categorization into gross profit was not available at the time.
57
Annual Report 2020
Performance criteria applicable to all Managing Directors
Performance targets
Minimum threshold Maximum threshold
Results 2020
Measured performance
in % | in € thousands
150% | 209,772
in € thousands
125,000
Revenue
170,000
n/a
Net revenue*
Adjusted EBITDA**
41,000
Fulfilled | 45,387
positive
n/a
Fulfilled | 5,620
* Note: For the definition of ‘net revenue’ please refer to the ‘Business Performance’ section above.
** Note: Adjusted EBITDA is excluding one-off impacts such as impairment of goodwill, acquisition related costs and option plans and is not a mea-
sure calculated in accordance with IFRS.
Calculated awards per Managing Director as per target achievement 2020
Corresponding award
Minimum threshold Maximum threshold
in € thousands
Actual award
outcome 2020
Ziv Elul, CEO
150
87.5
87.5
450
262.5
262.5
450
262.5
262.5
Dani Sztern, Deputy-CEO & COO
Yaron Zaltsman, CFO
Share options awarded to Managing Directors
Main conditions of share options awarded to Managing Directors
Information regarding reported financial year
During the year
Opening
balance
Closing
balance
Options
awarded
per 31 Strike
Dec 2019
Options
awarded
per 1 Jan
Options
awarded
per 31 Dec
Grant
date
Vesting
date
Expiration
date
Options
voided
Options
awarded
Options
vested
price
€0.21
€0.21
3,000,000
6,300,000
30 Jan 2019
7 May 2019
7 July 2020
30 Jan 2019
7 May 2019
7 July 2020
6 May 2019
1 Jun 2022
1 July 2024
6 May 2019
1 Jun 2022
1 July 2024
6 May 2019
1 Jun 2022
1 July 2024
30 Jan 2024
7 May 2024
1 July 2024
30 Jan 2024
7 May 2024
1 July 2024
30 Jan 2024
7 May 2024
1 July 2024
3,000,000
6,300,000
0
3,000,000
3,150,000
179,812
3,000,000
6,300,000
2,876,991
Ziv Elul
0
2,876,991 €0.352
0
2,876,991
1,500,000
3,800,000
1,438,496
1,500,000
3,640,000
1,438,496
5,753,983
1,500,000
3,800,000
€0.21
€0.21
1,725,000
1,625,000
1,725,000
1,500,000
1,900,000
89,906
1,500,000
3,800,000
1,438,496
1,500,000
3,640,000
1,438,496
25,493,983
Dani Sztern
0
1,438,496 €0.352
0
Yaron
Zaltsman
1,500,000
3,640,000
€0.21 30 Jan 2019
1,625,000
1,500,000
1,820,000
89,906
€0.21
7 May 2019
7 July 2020
0
-
1,438,496 €0.352
1,625,000
Total
25,493,983
in % of issued capital: 7%
19,749,000
0
13,229,624
58
Annual Report 2020
Remuneration of the Supervisory Board
in 2020
Board are entitled to reimbursement for their travel and
business-related expenses incurred in their capacity as a
Supervisory Board member.
Fyber's Supervisory Board Remuneration Policy was
introduced upon approval by the AGM 2020 and aims at
ensuring fair compensation and protecting the
independence of the Supervisory Board members. Terms
and conditions for the Supervisory Board members are the
responsibility of the Remuneration Committee of the
Supervisory Board.
All fees are fully paid out in cash on a quarterly basis. The
remuneration of the members of the Supervisory Board does
not depend on the results of the Company. No ordinary
shares, options and/or similar rights to subscribe for ordinary
shares have been granted to the members of the Supervisory
Board by way of remuneration for their services.
The EGM held on 11 April 2017 approved that, effective from
1 January 2017, the annual remuneration of the chairman of
the Supervisory Board shall be €200.0 thousand and the
annual remuneration for all other members of the
Supervisory Board shall be €100.0 thousand. Payment of the
remuneration shall be made in quarterly installments during
the financial year to which the remuneration relates,
payable at the start of every quarter. The remuneration can
be adjusted downwards at the discretion of the Supervisory
Board. In 2019 and again in 2020, the Supervisory Board
decided to adjust its remuneration downwards because of
the financial situation of the Company.
The individual remuneration of the Supervisory Directors is
determined by the General Meeting of shareholders. The
remuneration for Supervisory Directors is set at a level which
is considered appropriate to attract individuals with the
necessary international experience and ability to make an
important contribution to the Company’s cause.
Furthermore, the level of responsibility of each Supervisory
Director, the time and effort necessary to diligently
accomplish all tasks and fees paid by other companies of a
similar size and complexity has to be taken into account.
The Supervisory Directors receive a fixed remuneration for
their service, whereas the Chairman of the Supervisory
Board is entitled to a higher compensation. Apart from the
fixed annual remuneration, the members of the Supervisory
The table below presents the fees that have been paid to
Supervisory Board members for their service since the EGM
2017 on an annualized basis:
Annual remuneration of the Supervisory Board
2020*
2019*
2018
2017
in € thousands
Y. Safrai (chairman)
118.8
85.5
57
80
50
50
50
50
0
100
0
0
0
F. Rios (vice-chairman)
T. Malak
0
0
A. Metre
57
0
0
K. Sehnaoui
D. v. Daele
Y. Valler
57
100
200
100
100
100
700
0
0
200
100
100
100
500
0
0
G. Dubois
0
0
J. Schumann
Total
0
0
375.3
280
* reduced
None of the Supervisory Board members were given personal
loans, guarantees or any similar financial assistance. None of
the Supervisory Board members is holding shares of the
Company as per the date of the accounts.
For details and pro rata remuneration in 2020 please refer
to Note 41 of the Notes to the Consolidated Financial
Statements.
59
Annual Report 2020
Personnel Report
2020 was focused on restructuring our business organiza-
(“G&A”). The current structure supports the existing business
as well as our budgeted growth plan for 2021.
tion to enable stronger alignment with the overall company
strategy and offer even better and more efficient services
to our customers. Furthermore, many efforts went into
ensuring a smooth transition into the new work-from-home
policies for all our employees. Regular digital company-
wide update calls and adapting our comprehensive fringe
benefits package to the new setting helped to keep up the
spirit in these challenging times. Fyber continues to adhere
to all local health guidelines and puts the security of
employees first.
Employees by division & geography
Fyber shows a highly diverse workforce of more than 35
nationalities in its offices in Berlin, Tel Aviv, San Francisco,
New York, Beijing, Seoul, and London. The below charts give
an overview of the number of employees by division and
office location. 42% of all employees globally are working in
R&D. The Company is a technology company,
conceptualizing and developing proprietary software
solutions in-house and providing them to clients worldwide.
As such, R&D is at the heart of Fyber’s operations and
investment focus, comprising product design and
management, software engineering, solution engineering,
quality assurance and data science.
By the end of 2020, the total number of employees,
including permanents and working students, was at 220,
across the departments research & development (“R&D”),
sales & marketing (“S&M”) and general & administration
Fyber’s personnel structure
Number of employees as of 31 December 2020, including permanent employees and working students/interns
6%
30%
4%
5%
32%
9%
By
division
By
location
28%
42%
44%
R & D
S & M
G & A
BER
TLV
SFO
LON
BEIJꢀꢀꢀꢀꢀ/ꢀꢀꢀꢀSEOUL
NYC
60
Annual Report 2020
Shaping our company values
processes such as hiring, promotions and the review of
employee performance. Despite the additional challenges
brought onto the Company by COVID-19, Fyber evolved as
an organization and came out stronger than ever. We are
proud to have been recognized by Dun & Bradstreet 2020
as the Top 18 company in their 2020 list of “Best High Tech
Companies to work for in Israel” - a proof point of Fyber’s
commitment to creating the best work environment for
employees.
Fyber redefined its core values during the year. The set of
joined, equally important values best express our focus on
technological leadership through innovation, long-term
value creation and our drive to establish and maintain a fair,
inspiring work environment for all our employees. While
adapting some existing values, two more values were added
that represent the Company’s DNA strongly: resilience and
being customer-centric. The Management Board promotes
and applies these values thoroughly in all personnel-related
61
Annual Report 2020
Fyber Values
Commitment & Care
We believe that our business will
thrive in an environment of
Customer Centric
Accountability
At Fyber, the entire
kindness and concern for others
around us. We share a world-view
that encourages dedication
whether it is to a business goal,
a colleague, or a social cause.
Taking responsibility is our way
to constantly improve. We are
seeking to learn from the
consequences of our actions -
whether through mistakes or
through success stories. When
deserved, we happily give out
credit to those entitled to it.
organization is oriented on
solving customer needs. We
focus on building positive,
strong, and long-term
relationships with customers
and partners. To accomplish
this, we will not rest until our
customers are happy and
satisfied. We expect our entire
team to provide white-glove
service, tailored to our
We aspire to build mutual-trust
and partnerships - both internally
within our teams and externally
with our customers/suppliers.
Resilience
customer needs.
Fyber is a resilient organization thanks to
the people behind it. We value individuals
who are adaptable, able to endure
turbulent periods, and are consistently
persistent in their attempts to solve
problems rationally - that’s Fyber’s recipe
to outlasting the competition.
Diversity & Inclusion
We celebrate our differences and draw our strength
from them. We build products for a global
community and believe in building diverse teams to
support innovation & creativity. We are committed
to creating an inclusive workplace for our employees
- accepting all cultures, personalities, and opinions.
Proactiveness & Courage
Our “can-do” attitude is essential to succeed
in our fast-pacing industry. We have the
bravery to take educated risks. We are driven
by a sense of urgency to solve problems
before they arise and create impact.
Diversity
downloadable from our website. Further details can also be
found in the Corporate Governance Report of this Annual
Report. In the US, compensation and company culture data
provider “Comparably” awarded Fyber with place 9 in their
ranking of “best small and midsize companies for women in
2020” and place 5 in the category “best small and midsize
companies for diversity in 2020”. That is a major success
and shows that our efforts of creating a fair and equal work
environment for everybody pay off.
The members of the Management Board and the
Supervisory Board recognize the importance of diversity
with regards to the composition of the boards and the
entire workforce. The quota of female employees across the
group grew during 2020 to 46%. The Company is mindful of
all aspects of diversity and seeks to create a safe and
welcoming work environment to all.
The Company’s targets and current status relating to
diversity (gender, geographical provenance, education,
experience etc.) are described in our Diversity Policy,
62
Annual Report 2020
Equity Information
Capital structure
Shareholders owning 3% or more of the issued capital
of a listed company (a substantial shareholding or short
position) must report this to the Netherlands Authority
for Financial Markets (“AFM”) as soon as this threshold is
reached or exceeded.
The Company's shares are traded on the Prime Standard
of the Frankfurt Stock Exchange under the symbol ‘FBEN’
and the ISIN code NL0012377394. At the end of the year,
the issued capital of Fyber N.V. amounted to €37.218 million
divided into 372,189,292 common bearer shares with a
nominal value of €0.10 each. The issued capital as of 31
December 2020 consisted entirely of fully paid-up ordinary
shares. The authorized capital amounts to €120.0m and is
divided into 1.2 billion shares with a nominal value of €0.10
each.
Subsequently, notifications to the AFM must be done by the
shareholder as soon as a substantial shareholding or short
position reaches, exceeds or falls below set thresholds. The
thresholds are 3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%,
50%, 60%, 75% and 95% of the Company’s issued share
capital.
Potential dilution can arise from the conversion of the
remaining Bonds as well as from the exercise of options
under the Stock Option Plan. As of the reporting date €72.7
million principal amount of Bonds and 51.2 million options
with a weighted average strike price of €0.23 were
outstanding.
As at 31 December 2020, the following shareholders owning
3% or more of the Company’s voting rights were registered
with the AFM:
For changes to the share capital following the end of the
reporting period please refer to section ‘Subsequent Events’
above.
Major shareholders
% Voting rights
Advert Finance B.V.
92.2%
Key share data
Issuer
Fyber N.V.
FBEN
Ticker Symbol
ISIN
NL0012377394
Frankfurt Stock Exchange,
Prime Standard
Market
Currency
Euro
372,189,292
0.96 / 0.20
Number of shares
52 weeks high / -low*
* Note: as of 13 April 2021
63
Annual Report 2020
Responsibility Statement
The Management Board is responsible for the design,
It should be noted that the above does not imply that these
systems and procedures provide absolute assurance as to
the realization of operational and strategic business
objectives, or that they can prevent all misstatements,
inaccuracies, errors, fraud and non-compliances with
legislation, rules and regulations. Nor can they provide
certainty that we will achieve our objectives.
implementation and operation of Fyber’s internal risk
management and control systems. In discharging this
responsibility, the Management Board has assessed the
effectiveness of the Company’s internal control and risk
management systems in accordance with best practice
provision 1.4.3 of the Code. Based on this assessment and
to the best of its knowledge and belief, the Management
Board states that:
Berlin, 30 April 2021
Fyber’s internal risk management and control systems
provide reasonable assurance that the Annual Report
does not contain any errors of material importance.
The Management Board
Ziv Elul | Chief Executive Officer
Dani Sztern | Deputy Chief Executive Officer &
Chief Operating Officer
There is a reasonable expectation that Fyber will be able
to continue in operation and meet its liabilities for at
least twelve months, therefore, it is appropriate to adopt
the going concern basis in preparing the Annual Report;
The expected future cash flows from operating activities
is largely based on management’s expectations and
estimates. These are uncertain as they are influenced by
subjective elements such as forecasted results and
margins from operating activities. For more information
on the going concern assumption and relevant
uncertainties, we refer to the Notes to the Financial
Statements.
Yaron Zaltsman | Chief Financial Officer
With reference to the statement within the meaning of
Article 5:25 (2c) of the Financial Supervision Act, the
Management Board states to the best of its knowledge and
belief, that:
The annual financial statements give a true and fair view
of the assets, liabilities, financial position and profit or
loss of the Company and the undertakings included in
the consolidation taken as a whole; and that
the Management Board Report includes a fair review of
the development and performance of the business and
the position of the Company and the undertakings
included in the consolidation taken as a whole, together
with a description of the principal risks and uncertainties
that the Company faces.
64
Annual Report 2020
Consolidated
Financial
Statements
2020
$
89
Annual Report 2020
Consolidated
Income Statement
Year ended 31 December
Notes
2020
2019
in € thousands
Revenue
6
(99,520 )
Cost of sales
Gross profit
8,9
(179,276 )
Other operating income
Research and development expenses
Sales and marketing expenses
General and administrative expenses
Other operating expenses
Earnings before interest and tax (EBIT)
Finance income
7
8,10
8,11
8,12
13
(12,100 )
(14,970 )
(7,745 )
(461 )
(12,775 )
(15,910 )
(8,774 )
(3,843 )
(20,501 )
(4,780 )
Finance costs
(10,588 )
(10,505 )
(15,285 )
(215 )
(28,800 )
(28,728 )
(49,229 )
Net finance costs
14
15
Loss before tax
Income tax gain (expense)
Loss for the year after tax
Loss attributable to
(15,500 )
(48,769 )
Shareholders of Fyber N.V.
Non-controlling interest
Earnings per share
(15,500 )
(48,769 )
-
Basic loss per share (€)
Diluted loss per share (€)
17
17
(0.04 )
(0.04 )
(0.18 )
(0.18 )
The notes on pages .. to .. are an integral part of these consolidated financial statements.
90
Annual Report 2020
Consolidated Statement
of other Comprehensive Income
Year ended 31 December
Notes
2020
2019
in € thousands
(15,500 )
Loss for the year after tax
(48,769 )
To be reclassified to profit and loss in subsequent periods
Exchange differences on currency translation
Income tax effect
28.6
16
(6,456 )
Other comprehensive income (loss) for the year, net of tax
Total comprehensive loss for the year
(6,456 )
(21,956 )
(46,777 )
Comprehensive loss attributable to
Shareholders of Fyber N.V.
(21,956 )
(46,777 )
Non-controlling interest
The notes on pages .. to .. are an integral part of these consolidated financial statements.
91
Annual Report 2020
Consolidated Statement
of Financial Position
As per 31 December
in € thousands
Notes
2020
2019
Non-current assets
Goodwill
18
19
Other intangible assets
Intangible assets
Property and equipment
Non-current financial assets
Deferred tax assets
Total non-current assets
20
21
26
Current assets
Inventories
22
23
24
25
27
Trade and other receivables
Other current financial assets
Prepayments
Cash and cash equivalents
Total current assets
Total assets
The notes on pages .. to .. are an integral part of these consolidated financial statements.
93
Annual Report 2020
Consolidated Statement
of Financial Position
As per 31 December
in € thousands
Notes
2020
2019
Equity
Issued capital
28.1
28.1
(4,551 )
(4,745 )
Share premium
Treasury shares
28.2
28.3
28.4
28.5
28.6
Other capital reserves
Legal reserve capitalized self-developed intangible assets
Retained earnings
(303,116 )
(6,711 )
(286,969 )
(255 )
Foreign currency translation reserve
Equity attributable to shareholders of the Company
Non-controlling interests
Total equity
Non-current liabilities
Employee benefits
29
30
26
31
Loans and borrowings
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
Current liabilities
Trade and other payables
Employee benefits
32
29
33
Loans and borrowings
Other current liabilities
Current tax liabilities
Total current liabilities
Total liabilities
Total equity (deficit) and liabilities
The notes on pages .. to .. are an integral part of these consolidated financial statements.
94
Annual Report 2020
Consolidated Statement
of Cash Flows
Year ended 31 December
Notes
2020
2019
in € thousands
Loss for the year after tax
(15,500 )
(48,769 )
(460 )
Income tax gain (expense)
Depreciation, amortization and impairment
Net finance costs
(1,348 )
14
Profit from sale of the right-of-use asset through sublease
Share based payments
Changes in provisions, employee benefit obligations
Changes in working capital
(461 )
(2,501 )
Cash generated from operations 1)
(1,965 )
(4,807 )
(3,215 )
Interest paid
Interest received
Income tax paid
(349 )
(1,213 )
Income tax received
Net cash flow from operating activities
Purchases of property and equipment
Purchases of and development expenditures for intangible assets
Net proceeds (payments) from investments and financial assets
Decrease/(Increase) in other non-current financial assets
Net cash flow from investing activities
Proceeds from non-current loans and borrowings
Proceeds (repayment) from current loans and borrowings
Payment of lease liabilities
(135 )
(9,235 )
(806 )
(4,576 )
(123 )
20
19
(3,601 )
(3,309 )
(5,505 )
(1,217 )
(1,887 )
30
(2,094 )
(202 )
Net cash flow from financing activities
Net changes in cash and cash equivalent
Cash and cash equivalent at beginning of period
Net foreign exchange difference
Net changes in cash and cash equivalent
Cash and cash equivalents at end of period
The notes on pages .. to .. are an integral part of these consolidated financial statements.
1) Lease payments for short-term leases, lease payments for leases of low-value assets and variable lease payments not included in the measurement
of the lease liability are classified as cash flows from operating activities.
95
Annual Report 2020
Consolidated Statement
of Change in Equity
Foreign
Other
capital
reserves
currency
Retained translation
Non-
controlling
interest
Total
equity
(deficit)
Issued
capital
Share
premium
Treasury
shares
Legal
reserve
in € thousands
Notes
earnings
reserve
Total
01 Jan 2020
(4,745 )
(286,969 )
(255 )
Loss for the year
after tax
(16,147 )
(15,500 )
(15,500 )
Other
comprehensive
income (loss) for the
period, net of tax
28.6
(6,456 )
(6,456 )
(6,456 )
Total comprehensive
income (loss) for the
year
(16,147 )
(6,456 )
(21,956 )
(21,956 )
Share-based
payments - vesting
28.3
28.3
(256 )
(107 )
(30 )
Share-based
payments - exercise
Conversion of
convertible bond
5
(107 )
(107 )
Transaction costs
from share issue
Equity component
of the convertible
bond, net of tax
Transactions with
shareholders
31 Dec 2020
(4,551 )
(303,116 )
(6,711 )
The notes on pages .. to .. are an integral part of these consolidated financial statements.
97
Annual Report 2020
Consolidated Statement
of Change in Equity
Foreign
Other
capital
reserves
currency
Retained translation
Non-
controlling
interest
Issued
capital
Share
premium
Treasury
shares
Legal
reserve
Total
equity
in € thousands
Notes
earnings
reserve
Total
31 Dec 2018
(4,745 )
(237,416 )
(2,247 )
(15,558 )
(15,558 )
Effect of adopting
new accounting
standards, net of tax
3.11.
1.4
(76 )
(76 )
(76 )
01 Jan 2019
(4,745 )
(237,492 )
(2,247 )
(15,634 )
(15,634 )
Loss for the year
after tax
(49,477 )
(48,769 )
(48,769 )
Other
comprehensive
income (loss) for the
period, net of tax
Total comprehensive
income (loss) for the
year
(49,477 )
(46,777 )
(46,777 )
Share-based
payments -vesting
28.3
28.3
(851 )
(851 )
(851 )
Issue of shares upon
conversion of
convertible bonds
Transaction costs
with respect to bond
conversion
Equity component
of the convertible
bond, net of tax
Transactions with
shareholders
31 Dec 2019
(4,745 )
(286,969 )
(255 )
The notes on pages .. to .. are an integral part of these consolidated financial statements.
98
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
Notes to the
Consolidated
Financial
Statements
NOTES
$
99
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
1
GENERAL
1.1
Reporting entity and relationship with parent company
with limited liability ( naamloze vennootschap ) incorporated under the laws of
the Netherlands
. The Company is a global
provider for advertising technology.
The Company is incorporated in
Amsterdam, The Netherlands
and is registered with the Dutch Chamber of Commerce
under the number 54747805. The Company’s head-office is located at
Wallstraße 9-13, 10179 Berlin
, Germany. The
Company's shares are traded on the Prime Standard of the Frankfurt Stock Exchange under the symbol ‘FBEN’.
Fyber empowers app developers and digital publishers to monetize their content through advanced technologies,
innovative ad formats and data-driven decision making. Fyber provides an open-access platform for both publisher’s
and digital advertisers with a global reach.
Fyber has offices in Berlin, Tel Aviv, San Francisco, New York, London, Beijing and Seoul and employs more than 220
people.
1.2
Financial reporting period
These financial statements cover the year 2020, which ended at the balance sheet date of 31 December 2020.
1.3
Going concern
As of 31 December 2020, the Group reported a loss and as a result of €15,500 thousand negatively impacting equity of
€14,862 thousand (31 December 2019: €33,076 thousand). While both operating and total cash flow were positive as
such cash and cash equivalents amounted to €25,972 thousand (31 December 2019: €12,876 thousand) the consolidated
working capital showed a deficit of €11,007 thousand (31 December 2019: €2,540 thousand).
At the balance sheet date, the Group had shareholder loans with Tennor Holding B.V. amounting to €32,000 thousand
(31 December 2019: €30,000) plus accrued interest of €4,788 thousand (31 December 2019: €2,237 thousand) which mature
in June 2022. Note that subsequent to the balance sheet date an amount of €15,000 thousand has been extended to
June 2023, refer to note 44 subsequent events.
Furthermore, the Group has revolving credit facilities from banks amounting to €25,821 thousand of which €21,379
thousand had been drawn (31 December 2019: €17,949 thousand). These credit facilities are due within the next 12 months
following the reporting date and considered current financing.
Finally the Group has a convertible loan amounting to €73.4 million as per 31 December 2020 with a maturity date of
July 2022; the company is dependent on the successful conversion of the loans into equity since this is one of the
conditions in order to finalize the acquisition by Digital Turbine.
Based on the current cash flow projections and liquidity analysis the Group is not able to repay these credit facilities
within the next 12 months if needed. Therefore, the Group depends on the willingness of the banks, bondholders and the
shareholder to prolong its financing.
These events and conditions relating to the company’s financing position indicate the existence of a material uncertainty
which may cast significant doubt about the company's ability to continue as a going concern.
100
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
2
BASIS OF PREPARATION
Statement of compliance
2.1.
The consolidated financial statements of the Group have been prepared in accordance with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) as adopted by the
European Union and the financial reporting requirements included in Part 9 of Book 2 of the Dutch Civil Code at the
balance sheet date.
The consolidated financial statements have been prepared on a going concern basis, which assumes the realization of
assets and the satisfaction of liabilities in the normal course of business. Please refer to note 1.3 for further details.
The consolidated financial statements of the Group have been authorized for issue by the Supervisory Board as of 30
April 2021.
2.2.
Basis of measurement
The consolidated financial statements have been prepared on a historical cost basis except for share-based payments,
that have been measured at fair value. Please refer to note 28.3 for further details.
2.3.
Functional and presentation currency
The consolidated financial statements are presented in Euro which is also the functional currency of the parent and
unless otherwise indicated all values are rounded to the nearest thousand Euro which may cause rounding differences.
The Group’s financial year corresponds to the calendar year. Tables that are labeled '2020' or '2019' comprise information
about the full year 2020 and 2019, respectively.
101
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
3
SIGNIFICANT ACCOUNTING POLICIES
The following significant accounting and valuation principles were applied uniformly across the Group to prepare the
financial statements.
3.1.
Basis of consolidation
The consolidated financial statements comprise the financial statements of Fyber N.V. and its subsidiaries as at
31 December 2020. Subsidiaries are entities that are controlled, directly or indirectly, by the Group. Control is achieved
when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability
to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if it
has:
▪
Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the
investee)
▪
▪
Exposure, or rights, to variable returns from its involvement with the investee, and
The ability to use its power over the investee to affect its returns
When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant
facts and circumstances in assessing whether it has power over the investee, including:
▪
▪
▪
The contractual arrangement with the other vote holders of the investee
Rights arising from other contractual arrangements
The Group's voting rights and potential voting rights
The Group reassesses whether it controls an investee if facts and circumstances indicate that there are changes to one
or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the
subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of the
subsidiary acquired or disposed of during the year are included in the statement of comprehensive income from the
date the Group gains control until the date it ceases to control the subsidiary.
The financial statements of the consolidated subsidiaries were prepared as at 31 December 2020, the same balance
sheet date as the Company. The financial statements of the subsidiaries are prepared for the same reporting period as
the Company, using consistent accounting policies. All intra-group balances, transactions, unrealized gains and losses
resulting from intra-group transactions and dividends are eliminated in full on consolidation.
Total comprehensive income within a subsidiary is attributed to the equity holders of the Group and to the non
controlling interests, even if that results in the non-controlling interests having a deficit balance.
-
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it derecognizes the related assets (including goodwill), liabilities, non-
controlling interests and other components of equity while any resultant gain or loss is recognized in profit or loss. Any
investment retained is recognized at fair value.
For all of its subsidiaries Fyber N.V. has control over all voting rights as of 31 December 2020.
3.1.1
Business combinations and goodwill
Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the
aggregate of the consideration transferred, measured at fair value at acquisition date and the amount of any non-
controlling interest in the acquiree. For each business combination, the Group elects whether it measures the non-
controlling interest in the acquiree either at fair value or at the proportionate share of the acquiree’s identifiable net
assets. Acquisition costs incurred are expensed and included in other operating expenses. When the Group acquires a
business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in
accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date.
This includes the separation of embedded derivatives in host contracts by the acquiree.
Any contingent consideration to be transferred by the acquirer will be recognized at fair value at the acquisition date.
Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within
102
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
equity. Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of
IFRS 9 Financial Instruments, is measured at fair value with the changes in fair value recognized in the statement of
profit or loss in accordance with IFRS 9. Other contingent consideration that is not within the scope of IFRS 9 is measured
at fair value at each reporting date with changes in fair value recognized in profit or loss.
Goodwill is initially measured at cost, as the fair value of the consideration being the excess of the aggregate of the
consideration transferred and the amount recognized for non-controlling interest over the fair value of the net
identifiable assets acquired and liabilities assumed. If this consideration is lower than the fair value of the net assets of
the subsidiary acquired, the difference is recognized in the income statement.
After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of
impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the
Group’s cash-generating units that are expected to benefit from the combination, irrespective of whether other assets
or liabilities of the acquiree are assigned to those units. Where goodwill has been allocated to a cash-generating unit
and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included
in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these
circumstances is measured based on the relative values of the disposed operation and the portion of the cash-
generating unit retained.
3.1.2
Foreign currencies
The functional currency of the parent of the Group is Euro, which is also the currency in which the Group prepares its
financial reports. For each entity the Group determines the functional currency and items included in the financial
statements of each entity are measured using that functional currency.
On consolidation, the assets and liabilities of foreign operations are translated into Euro at the rate of exchange
prevailing at the reporting date and their income statements are translated at exchange rates prevailing at the dates
of the transactions. The exchange differences arising on translation for consolidation are recognized in other
comprehensive income. On disposal of a foreign operation, the component of other comprehensive income relating to
that particular foreign operation is recognized in the income statement. Any goodwill arising on the acquisition of a
foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the
acquisition are treated as assets and liabilities of the foreign operation and translated at the spot rate of exchange at
the reporting date. The exchange rates of foreign currencies to Euro, that are significant for the Group, were subject to
the following changes:
Exchange rate at the balance sheet
per €
31 Dec 2020
31 Dec 2019
US Dollar
1.23
1.12
3.1.3
Transactions and balances
Transactions in foreign currencies are initially recorded by the Group’s entities at their respective functional currency
spot rates of exchange at the date the transaction first qualifies for recognition.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of
exchange at the reporting date.
Differences arising on settlement or translation of monetary items are recognized in profit or loss with the exception of
monetary items that are designated as part of the hedge of the Group’s net investment of a foreign operation. These
are recognized in OCI until the net investment is disposed of, at which time, the cumulative amount is reclassified to
profit or loss. Tax charges and credits attributable to exchange differences on those monetary items are also recorded
in OCI.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange
rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are
103
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
translated using the exchange rates at the date when the fair value is determined. The gain or loss arising on translation
of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in
fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognized in OCI or profit or
loss are also recognized in OCI or profit or loss, respectively).
3.2.
Recognition of income and expenses
Revenue from contracts with customers is recognized when control of services is transferred to the customer at an
amount that reflects the consideration to which the Group expects to be entitled in exchange for those services. The
service revenue from delivering advertising services is recognized when the service is rendered. This usually occurs when
the ad impression was generated which is the ad is fetched from its source and served on the user’s device. Depending
on the requirements of the specific campaign, further requirements might need to be fulfilled such as the device user
has clicked on the ad, downloaded specific content, provided personal data etc. Revenue is measured at the fair value
of the consideration received or receivable, taking into account contractually defined terms of payment and excluding
taxes or duties.
Other income is recognized when the future inflow of economic benefits from the transaction can be measured reliably
and was received by the Company during the reporting period.
Operating expenses are recognized either when the corresponding goods were received or services were rendered.
Interest income and expense are recorded using the effective interest method with exception of borrowing costs
capitalized according to IAS 23. In 2020 there were no qualifying assets so that all interest expenses were recorded in
profit and loss. Income and expenses are not offset unless gains and losses arising from a group of similar transactions.
Gains and losses from foreign currency transactions and revaluations are presented together in net finance costs.
3.3.
Personnel costs
3.3.1.
Short-term personnel costs
Short-term personnel costs 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 by the employee and the obligation can be estimated reliably.
3.3.2.
Stock option program
The fair value of stock options that are granted to employees and which are settled in shares in Fyber N.V. is recognized
as an expense with a corresponding increase in capital reserves. The amount recognized as an expense is adjusted to
reflect the number of awards for which the related service conditions are expected to be met. The expenses are recorded
over the vesting period, the time in which the employees become unconditionally entitled to the right to acquire shares
in the parent company at a fixed price. The fair value of the options is not re -measured but changes in the employees’
structure during the vesting period are recognized in profit or loss. A forfeiture of options after they have vested has no
effect on the Group accounts.
3.3.3.
Defined contribution plan
The Group periodically contributes to pension plans operated by governmental or private companies and recognizes
related expenses while the employees are employed.
3.4.
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 OCI.
3.4.1.
Current income tax
Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are
enacted or substantially enacted at the reporting date in the countries where the Group operates and generates taxable
104
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
income. Management periodically evaluates positions taken in the tax returns with respect to situations in which
applicable tax regulations are subject to interpretation and establishes provisions where appropriate.
Current tax assets and liabilities are offset only if certain criteria are met.
3.4.2.
Deferred income tax
Deferred taxes are recognized to account for the future tax effects of temporary differences between the tax bases of
assets and liabilities and their carrying amounts in the consolidated financial statements, and for tax loss carry-forwards,
using the liability method. Deferred taxes are measured on the basis of the tax laws already enacted or substantially
enacted for those fiscal years in which it is probable that the differences will reverse or the tax loss carry-forwards can
be utilized. Deferred tax assets are recognized for temporary differences or tax loss carry-forwards only when the ability
to utilize them in the near future appears to be reasonably certain. Deferred taxes are also recognized for temporary
differences resulting from the fair value measurement of assets and liabilities obtained through business combinations.
Deferred taxes relating to goodwill are recognized for temporary differences only when the goodwill can be utilized for
tax purposes.
Deferred tax is not recognized for: – temporary differences on the initial recognition of assets or liabilities in a transaction
that is not a business combination and that affects neither accounting nor taxable profit or loss; – temporary differences
related to investments in subsidiaries, associates, and joint arrangements to the extent that the Group is able to control
the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable
future; and – taxable temporary differences arising on the initial recognition of goodwill.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets
against current income tax liabilities and deferred taxes related to the same taxable entity and the same taxation
authority.
3.5.
Intangible assets
Other intangible assets, including customer relationships and trademarks, that are acquired by the Group and have
finite useful lives are measured at cost less accumulated amortization and any accumulated impairment losses.
Intangible assets that have a determinable useful life are amortized over their expected useful lives using the straight-
line method, starting from the time when they become available for use by the Group. Expenditure on research activities
is recognized in profit or loss as incurred. Development expenditure is capitalized only if the expenditure can be
measured reliably, the product 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. Subsequent to initial recognition, development expenditure is measured at cost
less accumulated amortization and any accumulated impairment losses. Please refer to note 3.7. for further details
Borrowing costs which are directly associated with the development of software that takes a substantial period of time
(qualifying assets) are included in the cost of production until the assets in question are ready for their intended use. The
details of amortization are as follows:
105
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
Useful life
in years
Amortization
method used
Internally generated
or acquired
Software
3 - 5
Straight line
Straight line
Straight line
Straight line
Straight line
Straight line
Impairment test
Acquired
Acquired
Customer contracts
Digital content
Development costs
Development costs
Others
Contract period
3
6
Acquired
Acquired
3
Internally generated
Acquired
3 - 6
-
Goodwill
Acquired
Intangible assets with an indefinite useful life such as goodwill are not amortized. At the reporting date, the use of these
assets by the Group is not limited by any economic or legal restrictions. An intangible asset is derecognized upon
disposal or when no future economic benefits are expected from its use or disposal. Gains or losses arising from de-
recognition (calculated as the difference between the net disposal proceeds and the carrying amount of the assets) are
recognized in the income statement.
3.6.
Property and equipment
Property and equipment are measured at cost and are depreciated over their expected useful lives using the straight-
line method. For purposes of depreciation, the following useful lives are applied:
Useful life in years
Depreciation method used
Straight line
Leaseholds improvements
2 - 3
3 - 13
3-10
Other operational and office equipment
Right of use assets (leases)
Straight line
Straight line
Property and equipment are derecognized upon disposal or when no future economic benefits are expected from its
use or disposal. Any gains or losses on the disposal of property and equipment (calculated as the difference between
the net disposal proceeds and the carrying amount of the assets) are recognized in the income statement.
3.6.1.
Leases
The Group has adopted IFRS 16 Leases from 1 January 2019. IFRS 16 introduced a single, on-balance sheet accounting
model for lessees. As a result, the Group as a lessee has recognized right-of-use assets representing its rights to use the
underlying assets and lease liabilities representing its obligation to make lease payments. Please refer to note 3.11. for
further details.
3.7.
Impairment of non-financial assets
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any
indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable
106
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) fair value less costs
of disposal and its value in use and is determined for an individual asset unless the asset does not generate cash inflows
that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or
CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
In assessing the value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In
determining fair value less costs of disposal, recent market transactions are taken into account, if available.
If no such transactions can be identified, an appropriate valuation model is used. Goodwill and intangible assets with
an indefinite useful life are not amortized but will be tested for impairment annually and when circumstances indicate
that they may be impaired. A previously recognized impairment loss for assets excluding goodwill will be reversed when
the recoverable amount exceeds the carrying amount of the asset again. The reversal is limited to the amount which
would have resulted if previous impairment losses had not been recognized. A recognized impairment loss in goodwill
will not be reversed. Goodwill is tested annually for impairment.
Please refer to note 18 for detailed information on estimates and key assumptions used to determine the necessity of
impairment, including a sensitivity analysis. Please refer to note 19 for further details about estimates and assumptions
applied.
3.8.
Inventories
Inventories are measured at the lower of cost and net realizable value. The cost of inventories is based on the first-in,
first-out principle.
3.9.
Financial instruments
3.9.1.
Recognition and initial measurement
Trade receivables and debt securities issued are initially recognized when they are originated. All other financial assets
and financial liabilities are initially recognized when the Group becomes a party to the contractual provisions of the
instrument. A financial asset (unless it is trade receivables without a significant financing component) or financial liability
is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly attributable to its
acquisition or issue. Trade receivables without a significant financing component is initially measured at the transaction
price.
3.9.2.
Classification and subsequent measurement
Financial assets
On initial recognition, a financial asset is classified as measured at amortized cost; FVOCI – debt investment; FVOCI –
equity investment; or FVTPL. Financial assets are not reclassified subsequent to their initial recognition unless the Group
changes its business model for managing financial assets, in which case all affected financial assets are reclassified on
the first day of the first reporting period following the change in the business model.
A financial asset is measured at amortized cost if it meets both of the following conditions and is not designated as at
FVTPL: – it is held within a business model whose objective is to hold assets to collect contractual cash flows; and – its
contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding.
A debt investment is measured at FVOCI if it meets both of the following conditions and is not designated as at FVTPL:
– it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling
financial assets; and – its contractual terms give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
On initial recognition of an equity investment that is not held for trading, the Group may irrevocably elect to present
subsequent changes in the investment’s fair value in OCI. This election is made on an investment‑by‑investment basis.
All financial assets not classified as measured at amortized cost or FVOCI as described above are measured at FVTPL.
On initial recognition, the Group may irrevocably designate a financial asset that otherwise meets the requirements to
107
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting
mismatch that would otherwise arise.
Financial assets – Business model assessment
The Group makes an assessment of the objective of the business model in which a financial asset is held at a portfolio
level because this best reflects the way the business is managed, and information is provided to management. The
information considered includes:
▪
The stated policies and objectives for the portfolio and the operation of those policies in practice. These
include whether management’s strategy focuses on earning contractual interest income, maintaining a
particular interest rate profile, matching the duration of the financial assets to the duration of any related
liabilities or expected cash outflows, or realizing cash flows through the sale of the assets;
how the performance of the portfolio is evaluated and reported to the Group’s management;
the risks that affect the performance of the business model (and the financial assets held within that business
model);
▪
▪
▪
▪
how those risks are managed; – how managers of the business are compensated – e.g. whether compensation
is based on the fair value of the assets managed or the contractual cash flows collected; and
the frequency, volume, and timing of sales of financial assets in prior periods, the reasons for such sales, and
expectations about future sales activity.
Transfers of financial assets to third parties in transactions that do not qualify for derecognition are not considered sales
for this purpose, consistent with the Group’s continuing recognition of the assets.
Financial assets that are held for trading or are managed and whose performance is evaluated on a fair value basis are
measured at FVTPL.
Financial assets – Subsequent measurement and gains and losses
Financial assets at FVTPL- These assets are subsequently measured at fair value. Net gains and losses, including any
interest or dividend income, are recognized in profit or loss.
Financial assets at amortized cost- These assets are subsequently measured at amortized cost using the effective
interest method. The amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses,
and impairment are recognized in profit or loss. Any gain or loss on derecognition is recognized in profit or loss.
Debt investments at FVOCI- These assets are subsequently measured at fair value. Interest income calculated using the
effective interest method, foreign exchange gains and losses, and impairment are recognized in profit or loss. Other net
gains and losses are recognized in OCI. On derecognition, gains and losses accumulated in OCI are reclassified to profit
or loss.
Equity investments at FVOCI- These assets are subsequently measured at fair value. Dividends are recognized as income
in profit or loss unless the dividend clearly represents a recovery of part of the cost of the investment. Other net gains
and losses are recognized in OCI and are never reclassified to profit or loss.
Financial liabilities – Classification, subsequent measurement gains and losses
Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if
it is classified as held‑for‑trading, it is a derivative, or it is designated as such on initial recognition. Financial liabilities at
FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in profit or
loss. Other financial liabilities are subsequently measured at amortized cost using the effective interest method. Interest
expense and foreign exchange gains and losses are recognized in profit or loss. Any gain or loss on derecognition is also
recognized in profit or loss.
3.9.3.
Derecognition
Financial assets
The Group derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire,
or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and
rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains
substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.
108
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The Group enters into transactions whereby it transfers assets recognized in its statement of financial position but retains
either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are
not derecognized.
Financial liabilities
The Group derecognizes a financial liability when its contractual obligations are discharged or canceled or expire. The
Group also derecognizes a financial liability when its terms are modified and the cash flows of the modified liability are
substantially different, in which case a new financial liability based on the modified terms is recognized at fair value.
On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration
paid (including any non‑cash assets transferred, or liabilities assumed) is recognized in profit or loss.
3.9.4.
Compound financial instruments
Compound financial instruments issued by the Group comprise convertible notes denominated in euro that can be
converted to ordinary shares at the option of the holder, when the number of shares to be issued is fixed and does not
vary with changes in fair value.
The liability component of compound financial instruments is initially recognized at the fair value of a similar liability
that does not have an equity conversion option. The equity component is initially recognized as the difference between
the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any directly
attributable transaction costs are allocated to the liability and equity components in proportion to their initial carrying
amounts. Subsequent to initial recognition, the liability component of a compound financial instrument is measured at
amortized cost using the effective interest method. The equity component of a compound financial instrument is not
remeasured. Interest related to the financial liability is recognized in profit or loss. On conversion at maturity, the financial
liability is reclassified to equity and no gain or loss is recognized.
3.9.5.
Loans under the Paycheck Protection Program
Loans under the Paycheck Protection Program were ultimately granted by the US federal government as part of the
CARES Act and obtained through the subsidiaries Fyber Inc and Inneractive USA, Inc. Until there is reasonable assurance
that these loans will be forgiven, the Group is accounting for them as liabilities. In case of forgiveness, the loans are
recognized as government grants in other operating income.
3.10.
Cash and cash equivalents
The cash and cash equivalents in the statement of financial position consist of cash in banks and cash on hand and
short-term deposits with an original maturity of three months or less. For the purpose of the statement of cash flows,
cash and cash equivalents consist of cash and short-term deposits as defined above.
3.11.
Leases
3.11.1.
Definition of a lease
At the inception of a contract, the Group assesses whether a contract is, or contains, a lease according to IFRS 16. A
contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of
time in exchange for consideration.
The Group presents right-of-use assets in property and equipment, the same line item as it would present underlying
assets of the same nature that it owns. The carrying amounts of right-of-use assets are as below:
in € thousands
31 Dec 2020
31 Dec 2019
Property and equipment
7,487
6,992
109
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The Group presents lease liabilities in ‘other non-current liabilities’ as well as ‘trade and other payables’ in the statement
of financial position.
3.11.2.
Recognition of a lease
The Group recognizes a right-of-use asset and a lease liability at the commencement date. The right-of-use asset is
initially measured at cost, and subsequently at cost less any accumulated depreciation and impairment losses and
adjusted for certain remeasurements of the lease liability. When a right-of-use asset meets the definition of investment
property, it is presented in investment property and subsequently measured at fair value.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined,
the Group entities’ incremental borrowing rate. Generally, the Group uses its Group entities’ incremental borrowing rate
as the discount rate.
The lease liability is subsequently increased by the interest cost on the lease liability and decreased by lease payment
made. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, a
change in the estimate of the amount expected to be payable under a residual value guarantee, or as appropriate,
changes in the assessment of whether a purchase or extension option is reasonably certain or be exercised or a
termination option is reasonably certain to be exercised.
Management as applied judgment to determine the lease term for some lease contracts in which it is a lessee that
include renewal options. The assessment of whether the Group is reasonably certain to exercise such options impacts
the lease term, which significantly affects the amount of lease liabilities and right-of-use assets recognized.
3.11.3.
Short-term leases and leases of low-value assets
The Group has elected not to recognize right‑of‑use assets and lease liabilities for leases of low‑value assets and
short‑term leases, including IT equipment. The Group recognizes the lease payments associated with these leases as an
expense on a straight‑line basis over the lease term.
3.12.
Changes in accounting policies and disclosures
3.12.1.
New and amended standards and interpretations
The Group applied for the first-time certain standards and amendments, which are effective for annual periods
beginning on or after 1 January 2020. The Group has not early adopted any other standard, interpretation or amendment
that has been issued but is not yet effective.
3.12.2.
Amendments to IFRS 3: Definition of a Business
The amendment to IFRS 3 Business Combinations clarifies that to be considered a business, an integrated set of activities
and assets must include, at a minimum, an input and a substantive process that, together, significantly contribute to the
ability to create output. Furthermore, it clarifies that a business can exist without including all of the inputs and processes
needed to create outputs. These amendments had no impact on the consolid ated financial statements of the Group,
but may impact future periods should the Group enter into any business combinations.
3.12.3.
Amendments to IFRS 7, IFRS 9 and IAS 39 Interest Rate Benchmark Reform
The amendments to IFRS 9 and IAS 39 Financial Instruments: Recognition and Measurement provide a number of reliefs,
which apply to all hedging relationships that are directly affected by interest rate benchmark reform. A hedging
relationship is affected if the reform gives rise to uncertainty about the timing and/or amount of benchmark-based cash
flows of the hedged item or the hedging instrument. These amendments have no impact on the consolidated financial
statements of the Group as it does not have any interest rate hedge relationships.
3.12.4.
Amendments to IAS 1 and IAS 8 Definition of Material
The amendments provide a new definition of material that states, “information is material if omitting, misstating or
obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial
statements make on the basis of those financial statements, which provide financial information about a specific
reporting entity.” The amendments clarify that materiality will depend on the nature or magnitude of information, either
110
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
individually or in combination with other information, in the context of the financial statements. A misstatement of
information is material if it could reasonably be expected to influence decisions made by the primary users. These
amendments had no impact on the consolidated financial statements of, nor is there expected to be any future impact
to the Group.
3.12.5.
Conceptual Framework for Financial Reporting issued on 29 March 2018
The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or
requirements in any standard. The purpose of the Conceptual Framework is to assist the IASB in developing standards,
to help preparers develop consistent accounting policies where there is no applicable standard in place and to assist all
parties to understand and interpret the standards. This will affect those entities which developed their accounting
policies based on the Conceptual Framework. The revised Conceptual Framework includes some new concepts, updated
definitions and recognition criteria for assets and liabilities and clarifies some important concepts. These amendments
had no impact on the consolidated financial statements of the Group.
3.12.6.
Amendments to IFRS 16 Covid-19 Related Rent Concessions
On 28 May 2020, the IASB issued Covid-19-Related Rent Concessions - amendment to IFRS 16 Leases The amendments
provide relief to lessees from applying IFRS 16 guidance on lease modification accounting for rent concessions arising
as a direct consequence of the Covid-19 pandemic. As a practical expedient, a lessee may elect not to assess whether
a Covid-19 related rent concession from a lessor is a lease modification. A lessee that makes this election accounts for
any change in lease payments resulting from the Covid-19 related rent concession the same way it would account for
the change under IFRS 16, if the change were not a lease modification. The amendment applies to annual reporting
periods beginning on or after 1 June 2020. Earlier application is permitted. This amendment had no impact on the
consolidated financial statements of the Group.
3.13.
Accounting estimates and assumptions
The preparation of the consolidated financial statements requires management to make estimates and assumptions
that affect the presentation of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the
financial statements as well as the reported amounts and presentation of income and expenses during the period.
Management based its assumptions and estimates on past experience and on other factors including the prevailing
economic environment available when the consolidated financial statements were prepared. Existing circumstances
and assumptions about future developments, however, may change due to market changes or circumstances arising
beyond the control of the Group. Actual amounts may differ from these estimates under different assumptions and
conditions. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year are discussed below. Information regarding the carrying
amounts determined with the use of estimates can be found in the comments on the specific line items and are explained
in the respective notes to which they relate to.
3.13.1.
Measurement of fair values
A number of accounting policies and disclosures require the determination of the fair value of the Group for financial
and non-financial assets and liabilities. To determine the fair value of assets and liabilities, the Group uses observable
market data as far as possible. If such inputs are not available, the management defines appropriate valuation methods
and input parameters. Based on the inputs used in the valuation techniques, the fair values are classified in different
levels in the fair value hierarchy:
▪
▪
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either
directly (i.e. as prices) or indirectly (i.e. derived from prices).
▪
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
If the inputs used to measure the fair value of an asset or a liabil ity fall into different levels of the fair value hierarchy,
then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest
level input that is significant to the entire measurement. The Group recognizes reclassifications in different levels of the
fair value hierarchy at the end of the reporting period in which the change occurred.
111
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
3.13.2.
Revenue recognition
The Group has a data-driven revenue stream. The recognition of the revenue is done at one point in time, which happens
primarily by the end of a month when invoices for the services provided during the month are issued and unbilled
receivables are accrued. Generally, the service of the Company is billed based on transactions tracked by Fyber with no
significant estimation involved. In some cases, the company is charging its services based on the tracking of external
third party tracking service provider or the customer’s data. Revenues in this respect are accrued every month based on
estimates taking into account Fyber’s own tracking and historical variances to the relevant tracking. However, these
external reports are normally received by the Company in the following month, verified with Fyber’s own tracking and
revenue amended where necessary.
3.13.3.
Intangible assets other than goodwill
Management uses assumptions to assess the technical and commercial feasibility and the future economic benefit of
internally generated software and digital content. Further estimates were applied by measuring the related
development costs and determining the useful lives. In case that an impairment test might be required in accordance
with the accounting policies, management uses significant assumptions on which the recoverable amount is based.
Please refer to note 18 for further details about estimates and assumptions applied.
3.13.4.
Income taxes
Uncertainties exist with respect to the interpretation of complex tax regulations, changes in tax laws, and the amount
and timing of future taxable income. Given the wide range of international business relationships and the long-term
nature and complexity of existing contractual agreements, differences arising between the actual results and the
assumptions made, or future changes to such assumptions, could necessitate future adjustments to tax income and
expense already recorded.
The Group establishes provisions, based on reasonable estimates, for possible consequences of audits by the tax
authorities of the respective countries in which it operates. The amount of such provisions is based on various factors,
such as experience of previous tax audits and differing interpretations of tax regulations by the taxable entity and the
responsible tax authority.
Such differences in interpretation may arise for a wide variety of issues depending on the conditions prevailing in the
respective domicile of the Group companies. Management judgment is required to determine the amount of deferred
taxes that can be recognized and with respect to changes in tax laws and the amount and timing of futu
re taxable
income. These judgments and assumptions are subject to risk and uncertainty, hence there is a possibility that changes
in circumstances will alter expectations, which may impact the amount of deferred taxes recognized and the amount of
other tax losses and temporary differences not yet recognized. Under such circumstances, the carrying amount of
recognized deferred taxes may require adjustment.
Please refer to notes 15 and 26 for further details about estimates and assumptions applied.
3.13.5.
Impairment of goodwill
The Group tests annually if goodwill has suffered any impairment in accordance with the accounting policies. Please
refer to note 18 for detailed information on estimates and key assumptions used to determine the necessity of
impairment, including a sensitivity analysis.
3.13.6.
Measurement of receivables and necessary impairments
The Group uses a provision matrix to calculate expected credit losses (ECL) for trade receivables. The provision rates
are based on days past due for groupings of various customer segments that have similar loss patterns (i.e., by
geography, product type, customer type and rating).
The provision matrix is initially based on the Group’s historical observed default rates. An event of default is generally
considered when a financial asset is 90 days overdue The Group will calibrate the matrix to adjust the historical credit
loss experience with forward-looking information. For instance, if forecast economic conditions (i.e., gross domestic
product) are expected to deteriorate over the next year which can lead to an increased number of defaults by debtors,
the historical default rates are adjusted. At every reporting date, the historically observed default rates are updated and
changes in the forward-looking estimates are analyzed.
112
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The assessment of the correlation between historical observed default rates, forecast economic conditions and ECL is a
significant estimate. The amount of ECL is sensitive to changes in circumstances and of forecast economic conditions.
The Group’s historical credit loss experience and forecast of economic conditions may also not be representative of
customer’s actual default in the future.
ECL on receivables from advertisers are determined taking into account a possible right of withholding from publisher
payouts in case of a default of the advertiser which usually applies. In such cases, ECL is solely calculated on the
company’s margin. The information about the ECL on the Group’s trade receivables is disclosed in note 3.9 and note 23.
3.13.7.
Measurement of compound financial instruments
The equity component of any convertible loan is determined by deducting the fair value of the financial liability from
the fair value of the instrument as a whole. Management judgement is required to assess market interest rate for
comparable financial instruments. Management assumes that the comparable, non-convertible loan would bear an
interest of 7.8%. This assumption is the same as in the prior year.
Please refer to the note 30 for further details about estimates and assumptions applied.
3.14.
Standards issued but not yet effective
A number of new standards are effective for annual periods beginning after 1 January 2020 and earlier adoption is
permitted; however, the Group has not early adopted new or amended standards in preparing these consolidated
financial statements.
3.14.1.
IFRS 17 Insurance Contracts
IFRS 17 establishes the principles for the recognition, measurement, presentation, and disclosure of insurance contracts
and supersedes IFRS 4 Insurance Contracts. IFRS 17 outlines a general model, which is modified for insurance contracts
with direct participation features, described as the variable fee approach. The general model is simplified if certain
criteria are met by measuring the liability for remaining coverage using the premium allocation approach. The general
model uses current assumptions to estimate the amount, timing and uncertainty of future cash flows and it explicitly
measures the cost of that uncertainty. It takes into account market interest rates and the impact of policyholders’ options
and guarantees. IFRS 17 is effective for reporting periods beginning on or after 1 January 2023, with comparative figures
required. Early application is permitted, provided the entity also applies IFRS 9 and IFRS 15 on or before the date it first
applies IFRS 17..
The new standard is not expected to have a significant impact on the Group’s consolidated financial statements.
3.14.2.
Amendments to IAS 1: Classification of Liabilities as Current or Non-current
In January 2020, the IASB issued amendments to paragraphs 69 to 76 of IAS 1 to specify the requirements for classifying
liabilities as current or non-current. The amendments clarify:
▪
▪
▪
▪
What is meant by a right to defer settlement,
That a right to defer must exist at the end of the reporting period,
That classification is unaffected by the likelihood that an entity will exercise its deferral right,
That only if an embedded derivative in a convertible liability is itself an equity instrument would the terms of
a liability not impact its classification.
The amendments are effective for annual reporting periods beginning on or after 1 January 2023 and must be applied
retrospectively. The Group is currently assessing the impact the amendments will have on current practice and whether
existing loan agreements may require renegotiation.
3.14.3.
Onerous contracts – Cost of Fulfilling a Contract (Amendments to IAS 37)
The amendments specify which costs an entity includes in determining the cost of fulfilling a contract for the purpose of
assessing whether the contract is onerous. The amendments apply for annual reporting periods beginning on or after
1 January 2022 to contracts existing at the date when the amendments are first applied. At the date of initial application,
the cumulative effect of applying the amendments is recognized as an opening balance adjustment to retained earnings
or other components of equity, as appropriate. The comparatives are not restated. The Group has determined that all
contracts existing at 31 December 2020 will be completed before the amendments become effective.
113
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
3.14.4.
Reference to the Conceptual Framework – Amendments to IFRS 3
In May 2020, the IASB issued amendments to IFRS 3 Business Combinations - Reference to the Conceptual Framework.
The amendments are intended to replace a reference to the Framework for the Preparation and Presentation of
Financial Statements, issued in 1989, with a reference to the Conceptual Framework for Financial Reporting issued in
March 2018 without significantly changing its requirements. The Board also added an exception to the recognition
principle of IFRS 3 to avoid the issue of potential ‘day 2’ gains or losses arising for liabilities and contingent liabilities that
would be within the scope of IAS 37 or IFRIC 21 Levies, if incurred separately. At the same time, the Board decided to
clarify existing guidance in IFRS 3 for contingent assets that would not be affected by replacing the reference to the
Framework for the Preparation and Presentation of Financial Statements. The amendments are effective for annual
reporting periods beginning on or after 1 January 2022 and apply prospectively.
3.14.5.
Property, Plant and Equipment: Proceeds before Intended Use – Amendments to IAS 16
In May 2020, the IASB issued Property, Plant and Equipment — Proceeds before Intended Use, which prohibits entities
deducting from the cost of an item of property, plant and equipment, any proceeds from selling items produced while
bringing that asset to the location and condition necessary for it to be capable of operating in the manner intended by
management. Instead, an entity recognizes the proceeds from selling such items, and the costs of producing those items,
in profit or loss. The amendment is effective for annual reporting periods beginning on or after 1 January 2022 and must
be applied retrospectively to items of property, plant and equipment made available for use on or after the beginning
of the earliest period presented when the entity first applies the amendment. The amendments are not expected to
have a material impact on the Group.
3.14.6.
IFRS 9 Financial Instruments – Fees in the ’10 per cent’ test for derecognition of financial liabilities
As part of its 2018-2020 annual improvements to IFRS standards process the IASB issued an amendment to IFRS 9. The
amendment clarifies the fees that an entity includes when assessing whether the terms of a new or modified financial
liability are substantially different from the terms of the original financial liability. These fees include only those paid or
received between the borrower and the lender, including fees paid or received by either the borrower or lender on the
other’s behalf. An entity applies the amendment to financial liabilities that are modified or exchanged on or after the
beginning of the annual reporting period in which the entity first applies the amendment. The amendment is effective
for annual reporting periods beginning on or after 1 January 2022 with earlier adoption permitted. The Group will apply
the amendments to financial liabilities that are modified or exchanged on or after the beginning of the annual reporting
period in which the entity first applies the amendment. The amendments are not expected to have a material impact
on the Group
114
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
4
COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT
The scope of consolidation, including Fyber N.V. as parent Company, comprises fourteen fully consolidated companies.
The subsidiaries and participation are as follows:
Country of incorporation
% equity interest
Fyber N.V.
UK
Falk Realtime Ltd.2
Fyber GmbH1
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
Germany
USA
Fyber Inc.
Fyber Media GmbH1
Fyber RTB GmbH1
Heyzap Inc.
Germany
Germany
USA
Fyber Monetization Ltd.
Fyber Digital UK Ltd.
Inneractive USA Inc.
RNTS Germany Holding GmbH
RNTS Media Deutschland GmbH
Israel
UK
USA
Germany
Germany
1 Companies use the exemption of section 264 (3) HGB (German Commercial Code). Therefore, the companies do not publish separate
financial statements or have these audited.
2 Fyber N.V. has provided a parental guarantee under section 479C of the Companies Act in respect of its subsidiary undertaking Falk
Realtime Limited. Falk Realtime Limited is exempt from having its individual accounts audited by virtue of section 479A of the Companies
Act.
During the year 2020, Advertile Mobile GmbH and AppMarie UG were merged into Fyber GmbH.
115
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
5
CONVERTIBLE BOND AND NET DEBT
In 2020, net debt developed as follows:
in € thousands
31 Dec 2020
31 Dec 2019
Non-current loans and borrowings
Current loans and borrowings
Cash and cash equivalents
Net debt (cash)
111,208
21,379
102,725
17,950
(25,972)
106,615
(12,876)
107,799
Non-current loans and borrowings consist of Convertible bonds and two PPP (Paycheck Protection Program) loans.
Please refer to note 30 for further details.
Throughout the year 2020, 30 bonds have been converted into 9,999,999 shares of Fyber N.V. for a price of €0.30 per
share. As of 31 December 2020 there were 727 bonds outstanding. After the reporting date, further bonds have been
converted. As of 27 April 2020 190 bonds were outstanding. The PPP loans amounting to €1,001 thousand as of 31
December 2020 have been completely forgiven in 2021. Please refer to note 44.4 for further details.
Current loans and borrowings composed of credit loan facilities obtained through Fyber Monetization Ltd. in Israel (Bank
Leumi and Discount Bank) and Fyber GmbH in Germany (BillFront). Please refer to note 33 for further details.
6
REVENUE
IFRS 15 Revenue model recognition includes five steps for analyzing transactions so as to determine when to recognize
revenue and at what amount: (1) Identifying the contract with customers. (2) Identifying distinct performance obligations
in the contract. (3) Determining the transaction price. (4) Allocating the transaction price to distinct performance
obligations. (5) Recognizing revenue when the performance obligations are satisfied.
The Group earns its revenue from providing user acquisition services by using technological tools and developments.
The Company's business is based on optimizing real time trading of digital advertising between buyers and sellers. The
revenue consists of different pricing schemes such as Cost per Mil Impression (CPM), performance-based metrics that
include Cost per Click (CPC) and Cost per Action (CPA) options. Revenue from advertising services is recognized by
multiplying an agreed amount per Mil Impression/click/ action with the volumes of these units delivered. The Group acts
as the principle in these arrangements and reports revenue earned and costs incurred on a gross basis. Please refer to
notes 3.2, 35 and 36 for further details.
7
OTHER OPERATING INCOME
In 2020 no other operating income has occurred (2019: the Group realized other operating income of €1,348 thousand
from the sublease of parts of its office in Berlin).
116
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
8
EXPENSES BY NATURE
in € thousands
31 Dec 2020
164,385
31 Dec 2019
Revenue share to third parties
Personnel costs and related costs
Fixed salaries
78,711
13,756
4,040
1,482
1,942
4,394
25,614
7,572
8,981
3,369
1,946
389
15,287
2,561
932
Variable salaries (bonus)
Stock based plan
Social security contribution
Other benefits
1,906
4,189
24,875
9,525
13,432
5,786
2,413
1,498
739
Total of personnel costs and related costs
Platform hosting costs and related costs
Depreciation and amortization
Professional services, consulting, and licenses
Rent & utilities
Marketing expenses
Other
1,835
Total cost of sales, selling and distribution,
administrative and research and development expenses
214,091
136,979
9
COST OF SALES
The Company's cost of sales consists primarily of payments made to suppliers of ad inventory (commonly referred to as
publishers) in a transaction that was settled through one of the Company’s various ad tech platforms. Other cost of
sales corresponds to other expenses for operating these platforms such as hosting costs, maintenance expense of
hardware, amortization of self-developed and acquired software, personnel costs, and facilities-related costs. Personnel
costs include salaries, bonuses, stock-based compensation, and employee benefit costs and are primarily attributable
to personnel in the Company's network operations Group who support the Company's platform. The Company
capitalizes costs associated with software that is developed or obtained for internal use and amortizes the costs
associated with its revenue-producing platform in cost of sales over their estimated useful lives. Amortization also
includes expenses associated with acquired intangible assets from the Company's business acquisitions that are related
to technology and development functions, customer contracts and brands.
117
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
in € thousands
2020
2019
Revenue share to third parties
Platform hosting costs and related costs
Depreciation and amortization
Personnel costs and related costs
Total cost of sales
164,385
7,572
78,711
9,525
11,043
241
7,119
200
179,276
99,520
10
RESEARCH AND DEVELOPMENT EXPENSES
The Company's technology and development expenses consist primarily of personnel costs, including stock-based
compensation and bonuses, professional services associated with the ongoing development and maintenance of the
Company's solution and, to a lesser extent, facilities-related costs, depreciation of equipment and amortization of
acquired software licenses. Technology and development costs are expensed as incurred, except for costs that are
associated with the development of internally used software that qualifies for capitalization. The Company allocates
overhead such as rent and occupancy charges based on headcount.
in € thousands
2020
2019
Personnel costs and related costs
Professional services, consulting, and licenses
Depreciation and amortization
Rent and utilities
8,887
1,703
778
8,052
2,725
972
665
780
Other
67
246
Total research and development
12,100
12,775
11
SALES AND MARKETING EXPENSES
Sales and marketing expenses consist primarily of personnel costs, including salaries, bonuses, stock-based
compensation, employee benefits costs and commission costs for the Company’s sales and marketing personnel. Sales
and marketing expenses also include costs for market development programs, advertising, promotional and other
marketing activities, and allocated overhead. The Company allocates overhead such as rent and occupancy charges
based on headcount.
118
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
in € thousands
2020
2019
Personnel and related costs
Publisher integration expenses
Depreciation and amortization
Rent and utilities
11,187
1,469
669
11,662
0
793
577
666
Professional services, consulting, and licenses
Marketing expenses
540
1,027
1,401
361
358
Other
170
Total sales and marketing expenses
14,970
15,910
12
GENERAL AND ADMINISTRATIVE EXPENSES
The Company’s general and administrative expenses relate to overhead functions such executive management, finance,
legal, compliance, investor relations and human resources and consist primarily of personnel costs, including salaries,
bonuses, stock-based compensation, as well as professional service fees for accounting, tax and legal advice and bad
debt expense. The Company allocates overhead such as rent and occupancy charges based on headcount.
in € thousands
2020
2019
Personnel and related costs
Professional services, consulting, and licenses
Rent and utilities
5,340
1,126
704
415
4,920
1,472
1,310
624
Depreciation and amortization
Investors relations
31
97
Other
129
351
Total general and administrative expenses
7,745
8,774
13
OTHER OPERATING EXPENSES
In 2020, other operating expenses amounting to €461 thousand (2019: €3,843 thousand) and related to unrealized
investments of €434 thousand and impairments of some Berlin office space. In 2019, all expenses related to impairments
119
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
of the following items: self-developed software of €1,712 thousand, technology and customer contracts acquired through
business combinations of €1,019 thousand and right-of-use asset of €1,112 thousand. Please refer to notes 3.7 and 19,
respectively, for further details.
14
NET FINANCE COSTS
The major components of net finance costs are as follows:
in € thousands
2020
2019
Other interest income
(83)
(83)
(72)
(72)
Finance income
Interest expense from Convertible Bonds
Loss on convertible loan conversion
Loss (gain) on convertible loan restructuring
Interest on shareholder loans
Bank interest and bank fees
Interest on lease liabilities
Other finance expenses, net
Currency effect, net
5,858
0
7,677
23,373
(6,713)
1,678
1,889
458
0
2,552
1,561
389
22
70
206
368
Finance costs
10,588
10,505
28,800
28,728
Net finance costs
120
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
15
INCOME TAX EXPENSE
The major components of income tax expense are as follows:
in € thousands
2020
2019
Breakdown of income tax reported in profit or loss
Current income tax charge
Deferred tax
215
503
Relating to the origination and reversal of
temporary differences
0
(963)
Income tax charged to profit or loss
215
(460)
Reconciliation of accounting loss to income tax expense / gain:
2020
2019
Accounting loss before tax
Applicable tax rate
(15,285)
30.175%
(4,612)
(49,229)
30.175%
(14,855)
Income tax at applicable tax rate
Non-deductible expenses for tax purposes
Interest barrier
1,223
293
931
6,425
420
Stock option expenses
Convertible bonds
1,275
1,513
2,108
1,365
(325)
1,891
(277)
Self-developed assets
27
Amortization of intangible assets
Different tax regime
1,302
(73)
Used tax loss carryforward
Unrecognized deferred tax assets in fiscal year
Others
(313)
1,552
(115)
Income tax (gain) expense reported in the statement
of comprehensive income
215
(460)
121
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
Since the acquisition of Fyber GmbH in 2014 the majority of revenues is generated through entities in Germany.
Therefore, the tax rate applied in Germany is deemed to be valid as Group tax rate from 2014 onwards. The tax rate of
30.175% contains corporate income tax of 15.825%, including solidarity surcharge, as well as trade tax of 14.35%.
Reconciliation of income tax gain and expense from the origination and reversal of temporary differences and tax loss
carried forward:
2020
2019
Changes in deferred tax assets recognized through P&L
Changes in deferred tax liabilities recognized through P&L
(373)
373
(1,516)
2,479
Income tax (gain) expense from the origination and reversal
of temporary differences and tax loss carried forward
0
963
16
OTHER COMPREHENSIVE INCOME
An income tax effect in relation to the exchange differences on currency translation was not recognized. In case that
taxable temporary differences may arise in this respect, the parent is able to control the timing of the reversal of such
temporary differences and it is probable that those differences will not reverse in the foreseeable future.
17
EARNING PER SHARE
Basic earnings per share are calculated by dividing the net income of the year attributable to ordinary equity holders of
Fyber N.V. by the weighted average number of ordinary shares outstanding during the year. Diluted earnings per share
are calculated by dividing the net income of the year attributable to ordinary equity holders of Fyber N.V. by the
weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary
shares that would be issued on conversion of all the potentially dilutive ordinary shares into ordinary shares. The basic
and diluted earnings per share are:
Unit
in € thousands
in pcs. thousands
in pcs. thousands
in €
31 Dec 2020
(15,500)
31 Dec 2019
(48,769)
Loss attributable to shareholders of Fyber N.V.
Weighted average shares outstanding, basic
Weighted average shares outstanding, diluted
Basic loss per share
364,251
364,251
(0.04)
274,519
276,244
(0.18)
Diluted loss per share
in €
(0.04)
(0.18)
122
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
18
GOODWILL
In 2020, the goodwill recognized through various acquisitions in prior years, developed as follows:
in € thousands
Fyber FairBid
31 Dec 2019
134,932
Currency effect
(6,282)
31 Dec 2020
128,650
in € thousands
Fyber FairBid
31 Dec 2018
133,321
Currency effect
1,611
31 Dec 2019
134,932
The Group’s goodwill resulted from the acquisition of the four platform businesses between 2014 and 2016. Goodwill is
tested whenever a triggering event occurs but at least once per year.
While 2020 was a challenging year for economies worldwide due to COVID-19 counter measures such as business
closures and stay-at-home orders, the digital advertising space proved to be resilient and recovered swiftly from short-
term impacts recorded in the second quarter of the year.
Fyber’s core market, the mobile in-app advertising market, contributed significantly to the growth of the digital ad space
even in this year of crisis. In addition, Fyber was an early adopter of working from home policies for all global offices,
restricting business travel, and adhering to all guidelines of local governments and public health authorities. As a
technology company delivering digital products and services we were less affected in our operations by the changes
and had all tools and systems already available to work remotely for anextended period of time. As such, no unplanned
investments were necessary to transition our operations to match the new requirements. As such, Fyber was able to
deliver on the product and business roadmap for 2020 as planned. Thus the Company experienced strong growth during
the year 2020, despite the challenges and uncertainties brought to the global economy by COVID-19.
In 2020, Apple announced that the new operating system iOS14 launched in the first fourth quarter of 2020 will include
a change in user data handling for the purpose of tracking of all sorts starting from the first six months of 2021. As the
timing and impact of Apple’s anticipated privacy changes remain uncertain as of the publication date, this is accounted
for in the current guidance only based on estimations and expectations. Fyber continues its product and business
initiatives to minimize any impact stemming from these policy changes.
The yearly impairment test was made based on the recoverable amount being the higher of the value in use and the
fair value less cost of disposal. The fair value less cost of disposal was determined using possible selling negotiations into
account and the value in use was based on cash flow projections that were derived from financial budgets approved
by senior management covering a period of twelve years, of which the first five years are based on a detailed budget
and the additional ten years on a high-level cash flow forecast.
The key assumptions on the compound average growth rates (CAGR) and the post-tax discount rates of the cash flow
projections are as follows:
Fyber FairBid
CAGR on revenue during the detailed forecast period of 5 years
CAGR on the free cash flow during the high-level forecast period for the next 6 years
CAGR on the free cash flow beyond the forecasted period
CAGR on total expenses during the detailed forecast period of 5 years
Post-tax discount rate
25.90%
12.36%
1.00%
9.89%
10.85%
123
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The business plan which is underlying the impairment test assumes that this revenue development in the core business
continues in 2021 and slows down over the detailed planning period.
Consistent to the Company’s approach in prior years, management is expecting to grow beyond the usual five-year
forecast period.
To address this challenge, the free cash flow is planned over a hig-hlevel period of 5 further years. This high-level planning
takes into account that historically high growth rates normally slow down over the long term. Before that background,
management decided that a Ten-year forecast period is more appropriate. This assessment is based on the market
share Fyber has reached and the advertiser and publisher relationships built in the past. It is assumed that due to a
further shift of advertising budgets to mobile advertising, there will be a significant growth in this space, which Fyber will
be able to service substantially within the infrastructure and cost base already built today. Based on these assumptions,
the recoverable values of the cash generating unit exceed its carrying amounts including goodwill.
The calculation of the value in use is most sensitive to the growth rate of revenue and total expenses applied both during
and beyond the explicit forecast period as well as the post-tax discount rate applied. Therefore, sensitivity tests were
performed by varying the following assumptions, holding all other variables constant:
Fyber FairBid
10% reduction on revenue CAGR during detailed forecast period
Increase of post-tax discount rate by 1% point
No
No
None of the sensitivity tests resulted in an impairment need. However, should the significant revenue growth assumption
underlying the impairment test for Fyber Platform not be achieved, an impairment would be required in the future.
124
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
19
OTHER INTANGIBLE ASSETS
Other intangible assets developed as follows:
Customer
contracts
in € thousands
Development
Technology
Others
Total
Acquisition or production cost
1 Jan 2019
21,980
0
20,305
4,560
40
17,288
0
5,091
64,664
4,576
Additions
16
43
Currency effects
31 Dec 2019
405
213
701
22,385
0
24,905
3,601
17,501
0
5,150
0
69,941
3,601
Additions
Retirement
0
(1,542)
(948)
0
(6)
(1,548)
(3,526)
68,468
Currency effects
31 Dec 2020
(1,578)
20,807
(833)
16,668
(167)
4,977
26,016
Amortization and impairments
1 Jan 2019
15,008
4,438
84
13,033
3,664
1,712
9,548
2,839
935
4,757
147
42,346
11,088
2,731
Additions
Impairments
0
Currency effects
31 Dec 2019
243
(4)
93
42
374
19,773
2,326
0
18,405
2,769
(1,542)
(290)
19,342
13,415
1,979
0
4,946
28
56,539
7,102
Additions
Retirement
(6)
(1,548)
(2,349)
59,744
Currency effects
31 Dec 2020
(1,351)
20,748
(549)
14,845
(159)
4,809
Carrying amounts
1 Jan 2019
6,972
2,612
59
7,272
6,500
6,674
7,740
4,086
1,823
333
204
168
22,318
13,402
8,724
31 Dec 2019
31 Dec 2020
Others include mainly the Fyber brand (Fyber, Heyzap and Inneractive) initially recognized through business
combination, as well as acquired software licenses. Management observes whether there are any indications, either from
125
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
external sources (i.e. current market trends, market capitalization of the Group) or from internal sources of information
(i.e. internal reports to economical and technical performance, impairment test of GGU) that an asset or a Group of
assets might be impaired. The remaining amortization periods for other intangible assets that are material to the
financial statements are as follows:
Carrying amount
in € thousands
Remaining amortization period
in years
Customer contracts
Development
59
0.5
0.5-3
1.5
6,674
1,823
Technology
During the financial year 2019, the Group further integrated the different platforms which finally resulted in the launch
of FairBid 2.0. Following a successful release in June 2019, a sunset of the legacy platforms was initiated. Fyber RTB was
shut down in September 2019, the AppBounty app was suspended in December 2019 and the old Fyber Mediation as
well as the Heyzap platform was officially closed in March 2020. Management considered such extensive technological
shift to FairBid 2.0 a triggering event for any technology carried in intangible assets, irrespective of whether self-
developed or acquired through business combinations. In 2020 no such impairment was recognized.
Following a respective review including exploration of a possible sale of assets, resulted in the following impairments:
2019
Fyber
Other
in € thousands
Development
Fyber RTB
Heyzap
FairBid 1.0
platform incl.
AppBounty
Total
tools
0
0
756
0
704
0
252
1,712
Technology and
customer
392
627
0
1,019
contracts
Total
392
627
756
704
252
2,731
In case that self-developed and acquired technology is not included in the current or future technology stack of Fyber,
it has been fully impaired based on the respective project which usually refers to a distinct tool or feature.
126
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
20
PROPERTY AND EQUIPMENT
The following table shows the development of property and equipment:
Other operational &
office equipment
Right of use
assets
in € thousands
Fixtures
Total
Acquisition or production
cost
1 Jan 2019
3,645
774
0
4,419
Recognition of right-of-use
asset on initial application
of IFRS 16
0
0
4,515
4,515
Additions
509
0
297
0
13,145
13,951
Sale of the right-of-use
asset through sub lease
(2,707)
(2,707)
Remeasurement of right-of-
use asset due to contract
modification
0
0
22
22
Disposal
(137)
28
(1)
10
(6,743)
218
(6,881)
256
Currency effects
31 Dec 2019
Additions
4,045
135
1,080
0
8,450
0
13,575
135
Remeasurement of right-of-
use asset due to contract
modification / Linkage to
consumer price index
0
0
2,640
2,640
Disposal
(106)
(103)
3,971
0
(39)
(52)
(647)
(158)
(789)
Currency effects
31 Dec 2020
1,041
10,391
15,403
Amortization and
impairments
1 Jan 2019
3,035
212
0
3,247
Additions
328
115
2,110
2,553
Sale of the right-of-use
asset through sub lease
0
0
(136)
(136)
Disposal
(101)
0
(1)
0
3
(1,626)
1,112
(2)
(1,728)
1,112
8
Impairment
Currency effects
7
127
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
31 Dec 2019
Additions
3,269
232
329
140
0
1,458
1,639
(9)
5,056
2,011
Disposal
(93)
(102)
Currency effects
31 Dec 2020
(127)
3,281
(26)
443
(184)
2,904
(337)
6,628
Carrying amounts
1 Jan 2019
610
776
562
751
0
6,992
7,487
1,172
8,519
8,775
31 Dec 2019
31 Dec 2020
690
598
Fixtures relate to the Group’s offices in Berlin, Tel Aviv and San Francisco. Right of use assets, related to offices lease
agreements other than short term.
21
NON-CURRENT FINANCIAL ASSETS
The non-current financial assets break down as follows:
in € thousands
31 Dec 2020
31 Dec 2019
Leasehold deposits
779
3,066
3,845
853
3,419
4,272
Non-current net investment in leases
Non-current financial assets
Leasehold deposits are cash deposits provided as security to the landlord. The deposits are not interest-bearing and
will be refunded upon the termination of the respective contract.
The non-current net investment in leases relates to the sublease of the Berlin office.
22
INVENTORIES
In 2019 the amount of €82 thousand related to gift cards from third parties like Amazon, Sony PlayStation or Microsoft
X-Box that were used as rewards in user acquisition campaigns. With the closure of such business operated through
Advertile Mobile GmbH at the end of 2019, the Group sold and reclassified any remaining vouchers to other receivables.
128
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
23
TRADE AND OTHER RECEIVABLES
Trade and other receivables break down as follows:
in € thousands
31 Dec 2020
63,878
31 Dec 2019
Trade receivables
VAT receivables
Prepayments
28,201
806
367
647
313
Others
145
157
Trade and other receivables
64,983
29,531
The trade receivables of €63,878 thousand are net of an allowance for bad debts of €856 thousand (2019: €1,326
thousand), which had developed as follows:
Charge for the
year
Unused amounts
reversed
1 Jan
Utilized
31 Dec
2020
1,326
1,811
2,235
(307)
(515)
(2,398)
(2,341)
856
1,326
2019
2,371
As at 31 December 2020 and 2019, the aging of trade receivables is as follows:
Past due but not impaired
Allowance
for bad debt
Total
Current
< 30
days
30 - 60
days
61 - 90
days
91- 180
days
> 180
days
2020
63,878
52,030
(856)
9,802
5,539
403
1,219
67
706
47
2,385
2019
28,201
20,550
(1,326)
572
941
Trade receivables are non-interest bearing and are generally settled on 30 - 90 day-terms. Please refer to note 39.2. for
further information.
129
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
24
OTHER CURRENT FINANCIAL ASSETS
Other current financial assets break down as follows:
in € thousands
31 Dec 2020
31 Dec 2019
2,967
Indemnification claim in respect to Fyber SAR (short term)
Current net investment in leases
1,171
355
301
364
567
Deposit for credit card and rent
Other current financial assets
1,827
3,898
The indemnification claim relates to reimbursement of Fyber for any payments that have to be made in connection with
the stock appreciation rights that have been triggered by the acquisition of Fyber GmbH. For further details on share
appreciation rights, please refer to note 29.
The current net investment in leases relates to the sublease of the Berlin office.
25
PREPAYMENTS
Prepayments relate primarily to integrations bonus for publishers of €292 thousand (2019: €518 thousand), licenses of
€375 thousand (2019: €435 thousand) and others of €522 thousand (2019: €477 thousand).
130
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
26
DEFERRED TAX ASSETS AND LIABILITIES
The deferred tax assets (DTA) developed during the reporting period as follows:
Employee
benefit
liability
Tax loss
carry-
forward
Thereof
through
P&L
Office
leases
in € thousands
Total
Other
1 Jan 2019
0
0
0
0
0
0
0
0
(5,747)
0
Offsetting with
deferred liabilities as of
1 Jan 2019
160
(2)
0
5,440
0
161
0
5,761
(2)
Employee benefits
(2)
Decrease of tax loss
carried forward to be
utilized
(1,492)
0
(1,492)
(1,492)
Other
0
(158)
0
0
(3,948)
0
0
0
0
(22)
(139)
0
(22)
(4,245)
0
(22)
0
Offsetting with
deferred tax liabilities
31 Dec 2019
(1,516)
Offsetting with
deferred liabilities as of
1 Jan 2020
158
153
0
3,948
0
0
0
0
139
0
4,245
153
0
153
Employee benefits
Decrease of tax loss
carried forward to be
utilized
(784)
0
(784)
(784)
Office leases
Other
0
0
0
0
198
0
0
198
60
198
60
60
Offsetting with
deferred tax liabilities
(3,164)
(198)
(199)
(3,872)
0
31 Dec 2020
0
0
0
0
0
(373)
131
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The deferred tax liabilities (DTL) developed during the reporting period as follows:
Equity
Intangible
assets
component
convertible
bonds
Office
leases
Thereof
through P&L
in € thousands
Total
1 Jan 2019
964
0
0
964
6,478
Offsetting with
deferred tax assets as
of 1 Jan 2019
3,253
2,508
0
5,761
0
Increase of self-
generated intangible
assets
(1,544)
0
0
0
0
(1,544)
(936)
(1,544)
(936)
Issue of convertible
bonds
(936)
Offsetting with
deferred tax assets
(2,673)
(1,572)
0
(4,245)
0
31 Dec 2019
0
0
0
0
(2,480)
Offsetting with
deferred assets as of 1
Jan 2020
2,673
(566)
1,572
0
0
4,245
(566)
0
Increase of self-
generated intangible
assets
0
0
(566)
Issue of convertible
bonds
0
0
27
0
27
166
27
166
0
Office leases
166
(166)
0
Offsetting with
deferred tax assets
(2,107)
0
(1,599)
0
(3,872)
0
31 Dec 2020
373
The Group recognizes deferred tax assets when deductible temporary differences are realizable. There is uncertainty
regarding the realization of deductible temporary differences in the future for all Group entities. Therefore, the Group
recognizes deferred tax assets arising from temporary differences and tax loss carry forwards for those entities for the
time being only to the extent that respective deferred tax liabilities are recognized and which have the similar
expectation to be realized as deferred tax assets. For this purpose, only deferred tax liabilities were qualified which relate
to the same tax entity and which have the similar expectation to be realized than the deferred tax assets. The Group
did not recognize deferred tax assets arising from temporary differences and tax loss carry forwards on the amount of
€31,609 thousand.
132
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
27
CASH AND CASH EQUIVALENT
Cash and cash equivalents consist of the following items, all freely available:
in € thousands
31 Dec 2020
31 Dec 2019
12,805
Cash at banks
25,958
14
Cash in hand
71
Cash and cash equivalents
25,972
12,876
28
EQUITY
The components and changes in consolidated equity are summarized in the consolidated statement of changes in
equity.
28.1.
Issued capital and share premium
The issued capital of Fyber N.V. amounting to €37,219 thousand is divided into 372,189,292 common shares, with a
nominal value of €0.10 each and developed like follows:
in pcs
2020
361,866,419
2019
114,533,333
1 Jan
Issue of shares upon conversion of convertible bond
Issue of shares upon exercise of stock options
31 Dec
9,999,999
322,874
247,333,086
0
372,189,292
361,866,419
The issued capital as of 31 December 2020 consisted entirely of fully paid-up ordinary shares. At the reporting date the
shares were publicly traded. The Company is listed on the regulated market of the Frankfurt Stock Exchange with
simultaneous admission to the sub-segment of the regulated market with additional post-admission obligations (Prime
Standard).
The authorized capital amounts to €120,000 thousand and is divided into 1,200,000,000 shares, with a nominal value of
€0.10 each.
During 2020 a total of 322,874 shares had been issued for employees/former employees who had exercised their stock
options plan into shares. In 2019 no shares were issued for such exercised options.
28.2.
Treasury shares
As of 31 December 2020, there is an amount of 1,860,904 outstanding treasury shares (2019: 1,966,667):
133
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
In 2016 2,000,000 had been acquired in the process of the divestment of Big Star Global by Fyber. Out of this amount
686,193 shares which had been tendered to the company in 2017 for a price of €1.80 per share, are still held by Mr
Hyunghoon Han. In return, the consideration for the shares has not been paid by the company yet. Please refer to
note 32 for further details.
In 2017, €100 thousand of the convertible loan were converted into 33,333 shares. The shares for this transaction were
transferred out of the treasury shares available to the Company.
In 2020, a total of 105,763 shares from the treasury shares were delivered to employees/former employees who had
exercised their stock option plan into shares (in 2019 no treasury shares were used for such exercised options).
28.3.
Other capital reserves
Other capital reserves in 2020 correspond to €31,446 thousand (2019: €30,489 thousand).
The bond conversion in 2019 resulted in an increase of the equity component on the amount of €4,247 thousand due to
the change in the conversion price from the original €3.00 to €0.30 per share.
In addition to that, initially introduced in 2015, the Company is running a stock option program implemented for senior
management and employees of the Group. During the year 2020, 14.7 million options were granted and 5.5 million were
forfeited due to the employees leaving (in 2019, 43.2 million and 13.9 million, respectively). As of 31 December, 2020, a
total of 51.2 million options were outstanding to employees, including 5.8 million granted to the management board,
with a weighted average strike price of €0.23 (2019: 42.7 million outstanding option with a weighted average of €0.23).
Of the outstanding options, 26.0 million were exercisable (2019: 17.0 million).
Reconciliation of outstanding share options:
Weighted-
average
exercise price 2020
Number of
options
2019
Weighted-
average exercise
price 2019
Number of
options 2020
Outstanding at 1 Jan
42,725,139
0.23
13,727,500
1.95
Expired
(2,000)
1.50
(8,000)
1.50
Forfeited during the
year
(5,414,359)
(750,416)
0.26
0.23
0.34
(13,950,611)
(278,750)
1.77
0.21
0.23
Exercised during the
year
Granted during the
year
14,677,469
43,235,000
Outstanding at 31 Dec
Exercisable at 31 Dec
51,235,833
26,007,986
0.26
0.23
42,725,139
17,048,453
0.23
0.22
In 2020 employees exercised 750,416 options (2019: 278,750) using the net-exercise mechanism, whereby the strike price
is not paid by the employees in cash but covered by the fair value of respective shares being withheld by the company.
The exercised but outstanding shares developed as follows:
134
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
Exercised but outstanding shares
Settlement
Shares
being
withheld
Settlement
through newly
issued shares
through
treasury
shares
1 Jan
Exercises
31 Dec
in pcs
2020
89,413
750,416
278,750
(405,094)
(322,874)
(105,763)
6,098
2019
0
(189,337)
0
0
89,413
The outstanding shares at the end of the year 2020 and 2019 related to exercises in the fourth quarter of each year,
being delivered to employees in the succeeding first quarter of 2021 and 2020 respectively.
The total fair value of the outstanding options has been determined using the Black Scholes model amounting to €3,846
thousand (2019: €2,404 thousand). New grants have been evaluated based on the following assumptions:
Assumptions
2020
€0.21-€0.45
0% p.a.
2019
€0.21-€0.40
0% p.a.
Share price
Dividend yield
Term of the option
Risk free interest rate
Historical volatility
Fluctuation
2.875 years
(0.58%) - (0.74%) p.a.
67% - 70%
20% p.a.
2.875 years
(0.53%) - (0.73%) p.a.
62%
20% p.a.
The options were granted to employees in 4 tranches in 2020, depending on when the employees have started. The
term of the options was assumed taking into account a maximum exercise period of five years following the start date
as well as the expected exercise behavior. As risk-free rate, ECB AAA yields adequate to the relevant term were used.
As the options are settled in shares, the value of the options is locked and not subject to revaluation and is accrued over
the vesting period and recognized in personnel costs. Concerning IFRS 2.20 the fluctuation rate is adjusted quarterly and
in consequence the number of shares exercisable and the expenses recognized are adjusted.
For 2020, the Group recognized personnel costs in connection with the stock option plan in an amount of €957 thousand
(2019: €932 thousand). Due to the specific vesting conditions of the stock option plan, expenses are incurred over-
proportionately in the first year after the grant with decreasing amounts to be recognized in the followingfuture periods.
28.4.
Legal reserve capitalized self-developed intangible assets
As of 31 December 2020, the legal reserve contained an amount of €8,627 thousand (2018: €7,980 thousand) for self
developed intangible assets.
-
28.5.
Retained earnings
The retained earnings/deficit includes the income of the companies included in the consolidated financial statements
plus first adoption of new accounting standards recognized directly in retained earnings.
135
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
28.6.
Foreign currency translation reserve
The foreign currency translation results from the translation of the accounts of the foreign subsidiaries from local
currencies, which are the functional currencies of these subsidiaries, into Euro which is the functional currency of the
parent Company and the reporting currency of the Group.
in € thousands
Total
(2,247)
1 Jan 2019
Translation of goodwill
1,611
282
Translation of intangible assets identified at acquisitions in excess to other net assets
Additional currency effects arising from the translation of subsidiaries
Foreign currency translation reserve 1 Jan - 31 Dec 2019
31 Dec 2019
99
1,992
(255)
(6,282)
(530)
356
Translation of goodwill
Translation of intangible assets identified at acquisitions in excess to other net assets
Additional currency effects arising from the translation of subsidiaries
Foreign currency translation reserve 1 Jan - 31 Dec 2020
31 Dec 2020
(6,456)
(6,711)
29
EMPLOYEE BENEFITS
The employee benefits liabilities relate to the remaining obligation from the share appreciation rights (SARs) assumed
by Fyber through the 2014 acquisition of Fyber GmbH amounting to €1,171 thousand as of the balance sheet date (2019:
€2,967 thousand).
For further details on share appreciation rights, please refer to note 24.
The disbursement schedule on the employee benefit liability is as follows:
in € thousands
31 Dec 2020
31 Dec 2019
Maturity in 1 year
5,005
233
0
5,517
238
0
Maturity in 2-5 years
Maturity in 5-10 years
Maturity in 10 years and more
Total employee benefits liabilities
0
0
5,238
5,755
136
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The current employee benefits liabilities consist of the following:
in € thousands
31 Dec 2020
31 Dec 2019
Unsettled from Fyber SAR
Unpaid variable compensation
Vacation accrual
1,134
2,453
1,346
72
2,961
1,513
1,039
4
Other
Short-term employee benefits liabilities
5,005
5,517
30
NON-CURRENT LOANS AND BORROWINGS
Non-current loans and borrowings developed during the reporting period as follows:
2020
2019
Share-
Protective
Payroll
Program
Share-
holder
loans
Convertible
Bond
Convertible
Bond
Total
holder
loans
Total
1 Jan
70,489
0
32,236
102,725
141,587
12,559
154,146
Loan
disbursement
0
1,105
2000
0
3,105
0
18,000
0
18,000
Bond
conversion
(2,930)
0
(2,930)
(72,036)
(72,036)
Amortization of
discount
5,860
0
7
0
2,552
8,419
0
7,677
(6,739)
0
1,677
9,354
(6,739)
0
Restructuring
0
0
0
0
Currency
effects
0
(111)
1,001
(111)
31 Dec
73,419
36,788
111,208
70,489
32,236
102,725
Each convertible bond has a nominal value of € 100 thousand, bears nominal interest of 3.5% p.a., and matures in July
2022. The effective interest rate of the bond, considering the option value and the transaction costs was determined to
be 7.96%. As of 31 December 2020, the carrying amount of the liability component of the convertible bonds amounts to
€73,419 thousand (2019: €70,489 thousand). After the reporting date, additional 537 bonds have been converted. On 15
April 2021, the company called for an early redemption to redeem all the outstanding bonds including accrued interest
on 17 May 2021. For more information regarding the convertible bonds please refer to notes, 44.1 and 44.2.
Between the years 2018 and 2020, the Company received five individual loans from Tennor Holding B.V. A nominal
amount of €8,000 thousand and €4,000 thousand in 2018 and of €3,000 thousand and €15,000 thousand in 2019 and
additional €2,000 thousand in 2020. All loans bear interest of 8% p.a. and were assigned to Meridian Capital
137
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
International Fund in February 2021. Loans amounting to € 30,000 thousand mature in June 2022 and the remaining €
2,000 thousand will become due in March 2023. Please refer to note 44.3 for further information.
As part of the COVID 19 measurements, the US entities, Fyber Inc. and Inneractive USA, Inc. each obtained a loan out of
the Paycheck Protective Program (“PPP loan”) of the US federal government. Such loans were designed to provide a
direct incentive for small businesses to keep their workers on payroll. The two loans, received in April and May 2020,
respectively, amounting to $1,230 thousand as of 31 December 2020. The loans carried interest of 1% p.a. to be paid
along with the loan principal in April and May 2022. At the beginning of 2021, both loans have been forgiven completely.
Please refer to note 44.4 for further information.
31
OTHER NON-CURRENT LIABILITIES
The other non-current liabilities break down as follows:
in € thousands
31 Dec 2020
31 Dec 2019
Heyzap earn-out due after 1 year
Lease liabilities
3,460
9,224
3,797
8,739
Other non-current liabilities
12,684
12,536
The Heyzap earn-out relates to the outstanding contingent consideration from the acquisition of Heyzap Inc. in 2016.
The current portion of the earn-outs is carried in trade and other payables (note 32). As of the balance sheet date, Fyber
has not come to a final agreement with the sellers of Heyzap Inc. with respect to the valuation and timing of the earn -
out. The liability is valued based on the expected outcome of the negotiations.
138
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
32
TRADE AND OTHER PAYABLES
The trade and other payables break down as follows:
in € thousands
31 Dec 2020
65,209
31 Dec 2019
23,006
Trade payables
Lease liabilities
1,946
0
2,346
358
Inneractive earn-out due within 1 year
Accruals
3,925
2,810
1,237
154
2,760
3,084
1,237
Heyzap earn-out due within 1 year
Liabilities from the purchase of treasury shares
Social security
276
Others
3,072
78,353
3,634
36,701
Trade and other payables
Trade payables related to the outstanding amount the Group owe to its publishers
The liability relating to the Inneractive earn-out relates to outstanding retention payments that the Group agreed to
employees in the course the acquisition of Inneractive Ltd. in 2016 was fully paid during the financial year 2020.
Accruals relates to services that have been received but not yet invoiced as of the reporting date as well as amounts
accrued for the audit of the financial statements and the preparation of tax returns.
The Heyzap earn-out relates to the current portion of the outstanding contingent consideration from the acquisition.
Please refer to note 31 for further details.
As of the reporting date, the Group carried liabilities resulting from the purchase of treasury shares amounting to €1,237
thousand (see note 28.2.).
33
CURRENT LOANS AND BORROWINGS
As of 31 December 2020, short-term borrowings amount to €21,379 thousand (2019: €17,950 thousand) and consist of
three revolving credit facilities from BillFront obtained through Fyber GmbH and from Bank Leumi and Discount Bank
obtained through Fyber Monetization Ltd.
In 2020, Fyber GmbH prolonged a credit line of €7,500 thousand working capital facility from BillFront to finance the
operating business, with an interest rate of 11.0% p.a., maturity date is on 10 September 2021. As of the reporting date
€3,227 thousand have been withdrawn (31 December 2019: €4,491 thousand).
139
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
In November 2019, Fyber Monetization Ltd. as borrower entered into an $15,000 thousand revolving credit line
agreement with Bank Leumi as lender until end of December 2020 and to reduce the maximum amount of the Leumi
credit line from $15,000 thousand to $13,500 and finally to $10,000 thousand, following a gradual reduction by June
2020. In November 2020 Fyber has extended Bank Leumi credit line to $12,500 thousand. The loan bears an interest rate
of 5.8% + LIBOR (London Interbank offered rate), Maturity date is on 30 December 2021.
As of the reporting date the Leumi credit line was entirely drawn (31 December 2019: $15,000 thousand).
On 12 July 2020, Fyber Monetization Ltd. as a borrower entered into an $5,000 thousand revolving credit line agreement
with an additional Israeli bank, named Bank Discount as lender. The loan bears an interest rate of 5.8% + LIBOR (London
Interbank offered rate). Maturity date of the discount bank loan is on 15 November 2021.
On 15 November 2020 bank discount has increased the credit facility to $10,000 thousand (by additional $5,000
thousands),
As of the date of this report, Discount bank credit line was 98% used, and is standing on $9,792 thousand as of the end
of December 2020.
Loan facility covenants:
While the BillFront credit line does not impose any covenants, Leumi and Discount loans, both have similar covenants
as follows:
Category
Revenue
Covenant
Negative deviation of 20% from budget in one quarter or negative deviation of 15%
from budget in 2 consecutive quarters
EBITDA
Accumulated positive EBITDA in the quarters during the period of Q1 2021-Q4 2021
Cash balance
Cash will be not lower than 20% of the withdrawn credit line
34
STATEMENT OF CASH FLOWS
The consolidated statement of cash flows was prepared using the indirect method for presentation of operating
activities.
Liabilities arising from financing activities developed as follows:
Non-cash changes
1 Jan
2020
Cash
flows
31 Dec
2020
Restructuring of convertible
bonds, bond conversion &
amortization of discount, net
effect
Foreign
exchange
movement
in € thousands
Non-current
loans and
borrowings
102,725
17,950
3,105
5,489
0
(111)
111,208
Current loans
and borrowings
5,121
(1,692)
(1,803)
21,379
Total liabilities
from financing
activities
120,675
8,226
5,489
132,587
140
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
Non-cash changes
1 Jan
2019
Cash
flows
31 Dec
2019
Restructuring of convertible
bonds & amortization of
discount, net effect
Foreign
exchange
movement
in € thousands
Non-current
loans and
borrowings
154,146
18,824
18,000
(1,217)
(69,421)
0
0
102,725
Current loans
and borrowings
343
343
17,950
Total liabilities
from financing
activities
172,970
16,783
(69,421)
120,675
35
OPERATING SEGMENTS
The Group’s operating activities are divided into segments which are defined by management as components of the
Group that has discrete financial information available and whose results are regularly reviewed by management for
purposes of performance assessment and resource allocation.
In prior financial reports, operating segment were mainly recognized along the four companies that were acquired since
2014: Fyber platform including Heyzap, Fyber RTB and Inneractive.
Since then, the Company invested heavily in the integration of its activities. The technical integration started with the
creation of internal integrations between the existing platforms to benefit from synergies. With the release of “Fyber
FairBid” (hereinafter referred to as “FairBid”) the Company entered the next stage towards the unified platform. Under
the unified platform, all of the Company's products, publisher tools and ad formats accessible through one single
integration and dashboard, with FairBid at the heart of this offering.
Parallel to the technical integration, management was working on the integration of business processes and the general
administration.
In the context of this integration activities, management is no longer holding on to review and assess the performance
of the existing platforms on a separate basis. In addition, future forecasts are going to be prepared based on the
potential of the unified platform only.
Types of products and services
Open access platform for advertisers and publishers for the holistic
trading of digital ads of all the relevant formats, including
programmatic trading and mediation services, as well as advanced
Fyber FairBid
publisher tools.
The financial performance for the years ended 31 December 2020 and the reference year ended 31 December 2019 are
as follows:
2020
2019
in € thousands
Fyber FairBid
Revenue
209,772
EBITDA
4,579
Revenue
118,973
EBITDA
(3,225)
141
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
Revenue and earnings before interest, tax, depreciation and amortization (EBITDA) are the key performance indicators
that management are reviewing on a regular basis when assessing performance of the operating segments.
Reconciliation from the amounts in the statement of financial position to the total amounts of all reportable segments
was not prepared since the information of the reportable segments completely match with the amounts shown in the
financial statements.
In 2020, the Group did not recognize any impairment losses (2019: €3,843 thousand).
36
GEOGRAPHIC INFORMATION
Breakdown of revenue according to customers’ location by operating segment:
2020
2019
in € thousands
United states
Revenue
Revenue
126,866
63,557
18,138
77,929
30,219
8,896
Europe, Middle east and Africa
Asia-Pacific
Rest of the world
Total
1,211
1,929
209,772
118,973
Breakdown of main relevant assets according to customers’ location by operating segment:
31 Dec 2020
31 Dec 2019
Property
and
equipment
Property
and
equipment
Intangible
assets
Intangible
assets
in € thousands
Total
Total
Germany
Israel
66,512
48,569
22,293
0
3,696
2,275
2,804
0
70,208
67,022
56,617
24,695
0
4,159
2,357
1,996
7
71,181
58,974
26,691
7
50,844
25,097
0
United states
United Kingdom
Total
137,374
8,775
146,149
148,334
8,519
156,853
142
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
37
MAJOR CUSTOMER’S INFORMATION
The Group places its cash with creditworthy financial institutions and performs ongoing credit evaluation of its
customers’ financial conditions. The Group provides services only for creditworthy clients and the receivable balances
are monitored on an ongoing basis.
The breakdown of the top three customers by revenue for the year ended 31 December 2020 is as follows:
in € thousands
Revenue
% revenue from Group’s revenue
Liftoff Mobile, Inc
Moloco, Inc.
33,032
13,148
15.75%
6.27%
The Trade Desk Inc
Total revenue for 3 top clients
12,754
58,934
6.07%
28.09%
38
CAPITAL MANAGEMENT
Capital includes equity attributable to shareholders of the parent. An analysis of the Group’s net debt is shown in note
5.
As of the reporting date, equity ratio was as follows:
in € thousands
31 Dec 2020
14,862
31 Dec 2019
33,076
Equity attributable to shareholders of Fyber N.V.
Total assets
243,965
208,942
Equity ratio
6.1%
15.8%
The primary objective of the Group’s capital management is to ensure that it maintains an appropriate capital structure
to support its current business and future growth and therefore maximize shareholders value.
39
FINANCIAL RISK MANAGEMENT
The Group is exposed to various financial risks which arise out of its business activities. Main risks identified include
financial market risks such as currency and interest rate risks, as well as liquidity risks and credit risks. The Group manages
these risks in accordance with its risk strategy to mitigate any negative effects on the financial performance and to
secure the financial position of the Group.
143
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
39.1.
Financial market risks
Market risk is the risk that the fair value or future cash flows of financial instruments will fluctuate due to changes in
market variables such as foreign exchange rates and interest rates.
39.1.1.
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in foreign exchange rates. The Group’s reporting currency is Euro. The Group is exposed to exchange rate risks
in several ways, particularly with respect to transactions in foreign currencies and foreign exchange translation effects,
arising mainly from the relative value of the Euro compared to the value of the US dollars ($). Due to the international
nature of the Group’s business, the Group currently has foreign sales and accounts receivable denominated in currencies
other than the Euro. In addition, the Group purchases advertising in local currencies and incurs a portion of its operating
expenses in other currencies than Euro. The Group faces exposure to adverse movements in currency exchange rates,
which may cause its revenue and operating results to differ materially from expectations. The Group’s operating results
could be negatively impacted depending on the amount of revenue or operating expenses that are denominated in
foreign currencies.
As exchange rates vary, revenue, operating expenses and other operating results, when translated, may differ materially
from expectations. In addition, the Group’s revenue and operating results are subject to fluctuation if the mix of US and
foreign currency denominated transactions or expenses changes in the future because the Group does not currently
hedge its foreign currency exposure. Management is constantly reviewing the situation and a currency hedging will be
considered in the future by the Group.
The following table demonstrates the sensitivity to a reasonably possible change in the exchange rate of $, with all other
variables held constant.
Effect on loss before tax
Effect on equity
in € thousands
(3,232)
Maximum/
minimum level
Change in $ rate
in € thousands
+ 5.00%
- 5.00%
+ 5.00%
- 5.00%
1.48
1.08
1.18
(82)
91
2020
3,573
323
(357)
(3,037)
2019
0.47
3,357
144
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
39.1.2.
Interest rate risk
As of the reporting date, the Group is funded through borrowings which bears interest based on fixed and floating
interest rates as follows:
in € thousands
31 Dec 2020
31 Dec 2019
Non-current loans and borrowings
Fixed interest rate
111,208
102,725
Float interest rate
0
0
Total loans and borrowings
111,208
102,725
Current loans and borrowings
Fixed interest rate
3,227
18,152
21,379
4,491
13,459
17,950
Float interest rate
Total current loans and borrowings
Interest risk arises from the possibility that changes in interest rates will affect future cash flows or the fair value of
financial instruments. As at 31 December 2020, the Group holds a revolving credit facility in the amount of €21,379
thousand, €18,152 thousand with a floating interest rate linked to the LIBOR rate, while the rest in with fix interest rate.
Therefore, interest rate charges in the future will have an impact on cash flows. Please refer to note 33. for further detasil
on the loans.
Change in interest rate
in basis points
Effect on loss after tax
in € thousands
+ 10
(10)
18
(18)
13
2020
+ 10
(10)
2019
(13)
As the Company does not have financial instruments measured at fair value, changes in the interest rate will have no
impact on equity.
39.2.
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract,
leading to a financial loss. The carrying amount of trade and other receivables as well as from cash and cash equivalents
represent the Group’s maximum exposure to credit risk. No other financial asset carries a significant exposure to credit
risk.
145
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The Group places its cash with creditworthy financial institutions and performs ongoing credit evaluation of its
customers’ financial conditions.
The Group provides services only for creditworthy clients and the receivable balances are monitored on an ongoing
basis. Please refer to the notes 3.9. for further details about the recognition and measurement of expected credit losses.
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However,
management also considers the factors that may influence the credit risk of its customer base, including the default risk
associated with the industry and country in which customers operate.
The Group has no significant exposure to any customer nor does it have any major concentration of credit risk. Please
refer to note 36 for further details.
Aging analysis of non-derivative financial instruments as of 31 December 2020 is as follows:
Past due
Allowance
for bad debt
Total
Current
30 -
60
days
61 -
90
days
< 30
days
> 90
days
in € thousands
Non-current
financial assets
3,845
0
(856)
0
3,845
0
0
0
0
Trade and other
receivables
64,983
1,827
53,135
1,827
9,802
403
0
67
0
2,432
Other current
financial assets
0
0
0
0
Cash and cash
equivalents
25,972
0
25,972
0
0
Non-derivative
financial
96,627
(856)
84,779
9,802
403
67
2,432
instruments
Aging analysis of non-derivative financial instruments as of 31 December 2019 is as follows:
Past due
Allowance
for bad debt
Total
Current
30 -
60
days
61 -
90
days
< 30
days
> 90
days
in € thousands
Non-current
financial assets
4,272
0
(1,326)
0
4,272
0
0
0
0
1,513
0
Trade and other
receivables
29,531
3,898
12,876
21,880
3,898
12,876
5,539
1,219
0
706
0
Other current
financial assets
0
0
Cash and cash
equivalents
0
0
0
0
Non-derivative
financial
50,577
(1,326)
42,926
5,539
1,219
706
1,513
instruments
146
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
39.3.
Liquidity risk
Liquidity risk arises from the possibility that the Group may not be able to meet its financial obligations as they fall due.
The Group establishes short and long-term capital management plans and analyses and reviews cash flow budgets
with actual cash outflows in order to match the maturity of financial liabilities and financial assets. In order to secure
and maintain the liquidity, the Group entered into one additional financing facility with Tennor Holding B.V. amounting
to €2,000 thousand in 2020.
The aggregate maturities of financial assets and financial liabilities outstanding, based on contractual undiscounted
payments, as of 31 December 2020 are as follows:
Within
1 year
1 year to
5 years
in € thousands
Total
> 5 years
Non-current financial assets
Trade and other receivables
Other current financial assets
Cash and cash equivalents
Financial assets
3,845
0
2,145
1,700
64,983
1,827
64,983
1,827
0
0
0
0
25,972
96,627
(233)
25,972
92,782
0
0
0
2,145
1,700
Non-current employee benefits
Non-current loans and borrowings
Other non-current liabilities
Trade and other payables
Current employee benefits
Current loans and borrowings
Other current liabilities
(233)
0
(117,548)
(12,684)
(78,353)
(5,005)
(21,379)
(56)
0
(117,548)
0
0
(10,414)
(2,270)
(78,353)
(5,005)
(21,379)
(56)
0
0
0
0
0
0
0
0
Current tax liabilities
(185)
(185)
0
0
Financial liabilities
(235,443)
(138,816)
(104,978)
(12,196)
(128,195)
(126,050)
(2,270)
(570)
Total net financial liabilities
Long-term borrowings include all interest that have been delayed to the maturity of the bond in July 2022. As mentioned
in note 1.3, the Group is currently not able to repay the convertible bond and the loans from Tennor Holding B.V. which
will fall due in June 2022. The management is currently exploring options to respond to the situation which occurs in July
2021 and 2021.
The aggregate maturities of financial assets and financial liabilities outstanding, based on contractual undiscounted
payments, as of 31 December 2019 are as follows:
147
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
Within
1 year
1 year to
5 years
in € thousands
Total
> 5 years
Non-current financial assets
Trade and other receivables
Other current financial assets
Cash and cash equivalents
Financial assets
4,272
0
2,113
2,159
29,531
3,898
29,531
3,898
12,876
46,305
0
0
0
0
0
0
12,876
0
50,577
(238)
2,113
(238)
(111,538)
(9,536)
0
2,159
Non-current employee benefits
Non-current loans and borrowings
Other non-current liabilities
Trade and other payables
Current employee benefits
Current loans and borrowings
Current tax liabilities
0
(111,538)
(12,536)
(36,701)
(5,517)
0
0
0
(3,000)
(36,701)
(5,517)
(17,950)
(199)
0
0
0
0
(17,950)
(199)
0
0
0
Financial liabilities
(184,679)
(134,102)
(60,367)
(14,062)
(121,312)
(119,199)
(3,000)
(841)
Total net financial liabilities
148
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
40
FINANCIAL ASSETS AND LIABILITIES
40.1.
Categories of financial assets and liabilities
The carrying values of financial assets per category are as follows:
31 Dec 2020
31 Dec 2019
Measured at
Measured at
amortized costs
in € thousands
Total
Total
amortized costs
Other non-current
financial assets
3,845
3,845
64,983
1,827
4,272
29,531
3,898
12,876
4,272
Trade and other
receivables
64,983
1,827
29,531
3,898
Other current financial
assets
Cash and cash
equivalents
25,972
25,972
12,876
Total financial assets
96,627
96,627
50,577
50,577
The carrying values of financial liabilities per category are as follows:
31 Dec 2020
Measured at
31 Dec 2019
Measured at
amortized costs
in € thousands
Total
Total
amortized costs
Non-current employee
benefits
233
233
238
238
102,725
12,536
36,701
5,517
Non-current loans and
borrowings
111,208
12,684
78,352
5,005
111,208
12,684
78,352
5,005
102,725
12,536
36,701
5,517
Other non-current
liabilities
Trade and other
payables
Current employee
benefits
Current loans and
borrowing
21,379
21,379
17,950
17,950
Total financial liabilities
228,861
228,861
175,667
175,667
149
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
40.2.
Fair value measurement of financial assets and liabilities
Except for the convertible bonds, carrying values are reasonable approximations of the respective fair values.
31 Dec 2020
Carrying amount Fair value
31 Dec 2019
Carrying amount
in € thousands
Fair value
Non-current loans and
borrowings
111,208
70,504
102,725
83,713
The convertible bonds are listed in Frankfurt Stock Exchange under XS1223161651, where the last closing price before
31 December 2020 was set at 45% (68% in 2019).
Except for the convertible bonds that its fair value is classified under level 1, every other financial instruments are
classified under level 3.
40.3.
Net results by measurement category
1 Jan - 31 Dec 2020
Recognized through profit and loss
From valuation
Net results
From interest
Currency
Revaluation
effect
in € thousands
Bad debt
Financial assets
Amortized costs
Financial liabilities
0
(26)
0
(128)
(154)
Measured at
amortized costs
(8,480)
(349)
0
0
(8,829)
Total
(8,480)
(375)
0
(128)
(8,983)
150
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
1 Jan - 31 Dec 2019
Recognized through profit and loss
From valuation
Net results
From interest
Currency
effect
in € thousands
Revaluation
Bad debt
Financial assets
Amortized costs
Financial liabilities
0
(31)
0
(350)
(381)
Measured at
amortized costs
(11,699)
(345)
(16,660)
0
(28,704)
Total
(11,699)
(376)
(16,660)
(350)
(29,085)
The conversion of the convertible in May 2019 resulted in a finance expense of €23,373 thousand and the restructuring
of the remaining convertible bond in October 2019 led to a finance income amounting to €6,713 thousand.
41
RELATIONSHIPS WITH RELATED PARTIES
Outstanding balances and transactions
41.1.
The following table provides the balances with related parties as at 31 Dec 2020 and 2019as well as the total amount of
transactions that have been entered with related parties during 2020and 2019:
2020
Amounts owed
by parties
Amounts owed
to parties
Purchases from
parties
in € thousands
Sales to parties
Key management personnel
Shareholder
0
0
0
3,044
Tennor Holding B.V.
Total
0
36,788
0
2,552
0
36,788
0
5,596
151
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
2019
Amounts owed
by parties
Amounts owed
to parties
Purchases from
parties
in € thousands
Sales to parties
Key management personnel
Shareholder
0
289
0
1,454
Tennor Holding B.V.
Total
0
32,236
0
1,677
0
32,525
0
3,131
As of 31 December 2020, earn-out payments relating to the acquisition of Fyber Monetization Ltd. (formerly Inneractive
Ltd.) were paid in full (2019: €289 thousand, of which €136 thousand, €78 thousand to Dani Sztern, and €75 thousand to
Yaron Zaltsman). See note 41.3 for further detail.
The purchases from key management personnel consist of compensation of €3,044 thousand (2019: €1,454 thousand).
41.2.
Compensation for key management personnel
Key management personnel include any person that has the authority and responsibility for planning, directing and
controlling of the activities of the entities, directly or indirectly.
The Group considers members of either the Management Board or the Supervisory Board of the parent as such key
management personnel for which compensation was recognized as follows:
in € thousands
31 Dec 2020
31 Dec 2019
Share-based payments
579
1,258
975
0
(115)
1,128
220
0
Short-term employee benefits
Variable benefits
Termination benefits
Defined contribution plan
Total compensation for key management personnel
232
221
3,044
1,454
152
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
in € thousands
Management Board
Ziv Elul1
Type
2020
2019
Share-based payments
Short-term employee benefits
Variable benefits
287
330
450
80
29
342
133
83
Defined contribution plan
Total
1,147
146
587
(71)
284
77
Daniel Sztern2
Share-based payments
Short-term employee benefits
Variable benefits
276
263
82
Defined contribution plan
Total
69
767
146
359
(73)
305
10
Yaron Zaltsman2
Share-based payments
Short-term employee benefits
Variable benefits
276
263
69
Defined contribution plan
Total
69
754
2,668
311
Total Management Board
1,257
Supervisory Board
Karim Sehnaoui3
Yair Safrai4
Short-term employee benefits
Short-term employee benefits
Short-term employee benefits
Short-term employee benefits
Short-term employee benefits
57
119
50
76
Arjun Metre5
57
46
Franklin Rios6
Tarek Malak7
86
25
57
0
Total Supervisory Board
Total
376
3,044
197
1,454
1 Member since June 15, 2016
2 Member since July 25, 2017
3 Member since October 1, 2017
4 Member since October 1, 2018, chairman since February 21, 2019
5 Member since January 31, 2019
6 Member since July 1, 2019, vice-chairman since January 30, 2020
7 Member since Oct 30, 2019
153
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The amounts shown in the table above are those recognized as an expense during the reporting period related to key
management personnel.
In 2020, the annual remuneration of the chairman of the Supervisory Board was €125 thousand (2019: €80 thousand),
the annual remuneration for the newly elected vice-chairman was €90 thousand and that the annual remuneration for
all other members of the Supervisory Board was €60 thousand each (2019: €50 thousand). For Q2 2020, the Supervisory
Board agreed to reduce their remuneration by 20% along with the Management and the employees as one measure
with respect to the COVID 19 pandemic.
41.3.
Payments in relation to the acquisition of Inneractive
According to the Inneractive purchase agreement and its amendments, several employees, at the Company’s discretion,
were entitled to receive certain payments that are related to the acquisition. Until the reporting date, Mr. Ziv Elul received
of total € 5.49 million, Mr. Dani Sztern €0.88 million, and Mr. Yaron Zaltsman €0.08 million, respectively.
The Inneractive acquisition agreement included an allocation of retention bonuses to Inneractive employees and
management. At the reporting date, all funds were paid in full.
42
AVERAGE NUMBER OF EMPLOYEES
During the financial year 2020, the Group, including all fully consolidated companies at the reporting date, had an
average of 237 (2019: 266) employees. Personnel expenses in 2020 amounted to €25,614 thousand (2019: €24,875
thousand. A geographic breakdown of the average number of employees as of the reporting period is shown in the
following table:
2020
2019
Israel
102
79
38
12
101
96
49
11
Germany
USA
UK
China
8
8
South Korea
Total
1
1
237
266
154
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
The above number breaks down to the functions as follows:
2020
2019
Cost of sales
2
98
15
93
Research and development
Sales and marketing
General and administrative
Total
71
84
66
237
74
266
43
AUDITORS FEE
KPMG Accountants N.V. was elected to audit the financial statements of the Group for the years 2019 and 2020. The
audit fees have been recognized in other operating expenses. The following fees were charged by KPMG Accountants
N.V. to the company, its subsidiaries and other consolidated companies, as referred to in Section 2:382a(1) and (2) of the
Dutch Civil Code:
2020
Other
KPMG
Network
2019
Other
KPMG
Network
KPMG
Accountants
N.V.
KPMG
Accountants
N.V.
Total
KPMG
Total
KPMG
in € thousands
Audit of the financial
statements
194
310
504
137
280
417
Tax-related advisory
services
0
45
45
0
90
90
Total
194
355
549
137
370
507
The above mentioned audit fees relate to the audit of the financial year 2020 and 2019 respectively and do not represent
the costs expensed during the year.
44
SUBSEQUENT EVENTS
44.1.
New share issuance in relation to bond conversion and stock option program
Throughout the first four months of 2021, the Company issued new shares to fulfill convertible bonds conversion requests
of 493 bonds as well as the stock options exercised by employees during the fourth quarter of 2020. In total, the
Company issued an additional 164.3 million shares in the first quarter of 2021. Consequently the new issued capital as
of the date of this report amounts to €53,652,262, divided into 536.5 million ordinary shares.
155
Notes to the Consolidated Financial Statements for the year ended 31 December 2020
44.2.
Optional redemption of Bonds
On 15 April 2021, Fyber gave notice to its bondholders that the Company is exercising its option pursuant to condition
(6(b)(i) of the terms and conditions of the Bonds to redeem all of the outstanding Bonds on 17 May 2021 at their principal
amount together with accrued and unpaid interest to such date. As an alternative to the redemption of its Bonds, each
bondholder may exercise the conversion rights relating to its Bonds until 7 May 2021.
44.3.
Assignment of shareholder loans to third party and prolongation
With effect from 17 February 2021, Tennor assigned the five promissory notes that together made up the shareholder
loans, to Meridian Capital International Fund (“Meridian”). All terms and conditions remain unchanged. Meridian agreed
to extend the loans as planned by the Company to June 2022 and March 2023 respectively.
44.4.
Paycheck protective program loan forgiven
During March and April 2021 PPP-loans amounting to €1,001 thousand as of 31 December 2020 have been completely
forgiven.
44.5.
Fyber to be acquired by Digital Turbine
On 22 March 2021, the Company announced that Austin-based Digital Turbine Inc., “Digital Turbine” (Nasdaq: APPS), a
global on-device mobile platform company, has signed definitive agreements with the Company’s major shareholders
to acquire a more than 90% shareholding in the Company at a total valuation of up to $600 million net of the
Company’s debt for 100% of Fyber’s share. This transaction is subject to customary closing conditions and is expected
to be closed in t he second quarter of 2021. Following the closing, the remaining shares shall be acquired by Digital
Turbine in
a mandatory takeover offer extended to all outstanding shareholders over the next months.
Fyber fully supports the acquisition and has entered into a separate support agreement with Digital Turbine providing
for among other things Digital Turbine’s commitment to the employees and the Company’s investment and growth
strategy.
156
Annual Report 2020
Company
Financial
Statements
2020
%
157
Annual Report 2020
Company Income Statement
Year ended 31 December
Notes
2020
2019
in € thousands
Revenue
0
0
0
0
0
0
Cost of sales
Gross profit
Other operating income
Research and development expenses
Sales and marketing expenses
General and administrative expenses
Other operating expenses
Earnings before interest and tax (EBIT)
Finance income
3
5,258
0
13,353
0
0
0
4
5
(6,242)
(8)
(13,407)
(25,871)
(25,925)
5,746
(992)
4,576
(8,459)
(3,883)
(4,875)
0
Finance costs
(26,721)
(20,975)
(46,900)
0
Net finance costs
6
Loss before tax
Income tax expense
Loss for the year after tax and
total comprehensive income for the year
(4,875)
(46,900)
Earnings per share
Basic loss per share (€)
Diluted loss per share (€)
(0.01)
(0.01)
(0.17)
(0.17)
The notes on pages 168 to 186 are an integral part of these Company financial statements.
158
Annual Report 2020
Company Statement
of Other Comprehensive Income
Year ended 31 December
2020
2019
in € thousands
(4,875)
Loss for the year after tax
(46,900)
0
To be reclassified to profit and loss in subsequent periods
Total comprehensive loss for the year
0
(4,875)
(46,900)
The notes on pages 168 to 186 are an integral part of these Company financial statements.
159
Annual Report 2020
160
Annual Report 2020
Company Statement
of Financial Position
As per 31 December
in € thousands
5
Notes
2020
2019
Non-current assets
Property and equipment
Non-current financial assets
Investment in subsidiaries
Other non-current financial assets
Total non-current assets
5
7
203,614
70,316
202,686
65,337
8
273,935
268,028
Current assets
Trade and other receivables
Other current financial assets
Prepayments
9
15,217
48
12,226
0
10
230
189
Cash and cash equivalents
Total current assets
11
201
304
12,719
15,696
Total assets
289,631
280,747
The notes on pages 168 to 186 are an integral part of these Company financial statements.
161
Annual Report 2020
Company Statement
of Financial Position
As per 31 December
in € thousands
Notes
2020
2019
Equity
Issued capital
Share premium
Treasury shares
12
12
12
37,219
251,948
(4,551)
36,187
250,389
(4,745)
Other capital reserves
Accumulated deficit
12
12
31,446
30,489
(144,059)
(139,184)
Total equity
12
172,003
173,136
Non-current liabilities
Non-current loans and borrowings
Total non-current liabilities
13
110,207
102,725
110,207
102,725
Current liabilities
Trade and other payables
Employee benefits
14
7,272
149
4,147
739
Total current liabilities
7,421
4,886
Total liabilities
117,628
289,631
107,611
Total equity and liabilities
280,747
The notes on pages 168 to 186 are an integral part of these Company financial statements.
162
Annual Report 2020
Company Statement
of Cash Flows
Year ended 31 December
Notes
2020
2019
in € thousands
Loss for the year after tax
(4,875)
(427)
3,883
29
(46,900)
25,871
20,975
160
Impairment (impairment reversal)
Financial income and expenses
Other non-cash effects
5
Changes in provisions, employee benefit obligations
Changes in working capital
(590)
608
(521)
(10,868)
(11,283)
(738)
Cash generated from operations
Interest paid
(1,372)
(29)
Net cash flow from operating activities
Purchases of property and equipment
(1,401)
0
(12,021)
(5)
Change in other non-current financial assets, net
Net cash flow from investing activities
(702)
(702)
2,000
0
0
(5)
Proceeds from non-current loans and borrowings
Proceeds (repayment) from current loans and borrowings, net
Net cash flow from financing activities
18,000
(6,303)
11,697
(329)
633
2,000
(103)
304
Net changes in cash and cash equivalents
Cash and cash equivalents beginning of period
Net changes in cash and cash equivalents
(103)
(329)
Cash and cash equivalents at end of period
201
304
The notes on pages 168 to 186 are an integral part of these Company financial statements.
163
Annual Report 2020
$
$
$
164
Annual Report 2020
Company Statement
of Changes in Equity
Other
Ordinary
shares
Share
premium
Treasury
shares
capital
reserves
Accumulated
deficit
Total
equity
in € thousands
Notes
01 Jan 2020
36,187
250,389
(4,745)
30,489
(139,184)
173,136
Profit (loss) for the year
after tax from continuing
operations and other
comprehensive income
for the period, net of tax
0
0
0
0
(4,875)
(4,875)
Total comprehensive
income (loss) for the
year
0
0
0
0
(4,875)
(4,875)
Share-based
payments - vesting
0
32
0
(256)
1,922
(107)
0
224
(30)
0
957
0
0
0
0
0
957
0
Share-based
payments - exercise
Conversion of
convertible bond
1,000
0
0
2,892
(107)
Transaction costs
from share issue
0
Equity component
of the convertible
bond, net of tax
0
0
0
0
0
0
Transaction with
shareholders
1,032
1,559
194
957
0
3,742
31 Dec 2020
12
37,219
251,948
(4,551)
31,446
(144,059)
172,003
The notes on pages 168 to 186 are an integral part of these Company financial statements.
165
Annual Report 2020
Company Statement
of Changes in Equity
Other
Ordinary
shares
Share
premium
Treasury
shares
capital
reserves
Accumulated
deficit
Total
equity
in € thousands
Notes
01 Jan 2019
11,453
184,812
(4,745)
25,313
(92,284)
124,549
Profit (loss) for the year
after tax from continuing
operations and other
comprehensive income
for the period, net of tax
0
0
0
0
(46,900)
(46,900)
Total comprehensive
income (loss) for the
year
0
0
0
0
(46,900)
(46,900)
Share-based
payments
0
0
0
0
929
0
0
0
929
Issue of share capital
24,734
66,428
91,162
Transaction costs
from share issue
0
(851)
0
0
0
(851)
Equity component
of the convertible
bond, net of tax
0
0
0
4,247
0
4,247
Transaction with
shareholders
24,734
65,577
0
5,176
0
95,487
31 Dec 2019
12
36,187
250,389
(4,745)
30,489
(139,184)
173,136
The notes on pages 168 to 186 are an integral part of these Company financial statements.
166
Notes to the Company Financial Statements for the year ended 31 December 2020
Notes to the
Company
Financial
Statements
167
Notes to the Company Financial Statements for the year ended 31 December 2020
1
FYBER N.V.
Fyber N.V. (hereinafter referred to as “Company” or together with its subsidiaries as “Fyber” or “Group”) is a global
provider for advertising technology.
The Company is incorporated in Amsterdam, The Netherlands and is registered with the Dutch Chamber of Commerce
under the number 54747805. The Company’s head-office is located at Wallstraße 9-13, 10179 Berlin, Germany. The
Company's shares are traded on the Prime Standard of the Frankfurt Stock Exchange under the symbol ‘FBEN’.
Fyber empowers app developers and digital publishers to monetize their content through advanced technologies,
innovative ad formats and data-driven decision making. Fyber provides an open-access platform for both publisher’s
and digital advertisers with a global reach.
Please refer to note 1 of the notes to the consolidated financial statements for further details.
2
ACCOUNTING POLICIES
Basis of preparation
2.1.
The Company financial statements have been prepared in accordance with the International Financial Reporting
Standards (IFRS) as adopted by the European Union (EU) and with Section 2:362(9) of the Dutch Civil Code unless
otherwise disclosed. The Company financial statements are presented in Euro which is also the functional currency of
the Company and unless otherwise indicated all values are rounded to the nearest thousand Euro which may cause
rounding differences.
2.2.
Summary of significant accounting policies
Further to the accounting policies described in note 3 of the notes to the consolidated financial statements, accounting
policies we applied specific to Company financial statements. In this respect, investments in subsidiaries were accounted
for at cost less accumulated impairment.
The Company is reviewing periodically whether its assets and liabilities are covered by the impairment test of the cash
generating unit of the Group Fyber FairBid. Assets that are reconciled to this cash generating unit are not considered
impaired as long as the carrying value of those assets is not exceeding the recoverable value of the cash generating
unit. The recoverable value is the higher the amount of the value in use and fair value less costs to sell. Net debts of the
Company are not taken into account when determining the recoverable value of the cash generating unit in this respect.
Assets that are not covered by the cash generating unit Fyber FairBid are tested independently when there are
indications for an impairment. Please refer to note 5 for impairments being recognized in 2019 and notes 3.7 and 18 of
the notes to the consolidated financial statements for further information on the impairment test on the level of the
Group.
Share based payments to employees of subsidiaries are increasing investment in subsidiaries. Other, than that, all
significant accounting and valuation principles for the Company financial statements were applied uniformly as for the
Fyber Group.
2.3.
Changes in accounting policies and disclosures
The Group applied IFRS 16 Leases for the first time in 2019. Several other amendments and interpretations apply for the
first time in 2019, but do not have an impact on the consolidated financial statements of the Company. The Company
has no impact from IFRS 16 Leases.
168
Notes to the Company Financial Statements for the year ended 31 December 2020
3
OTHER OPERATING INCOME
Other operating income breaks down as follows:
in € thousands
2020
2019
Management and shared service charged to subsidiaries
Reversal of impairment
4,709
435
12,395
0
Miscellaneous
114
958
Total other operating income
5,258
13,353
The reversal of impairment refers to trade receivables towards Heyzap Inc. that had been impaired in 2019 but actually
collected in 2020.
4
GENERAL AND ADMINISTRATIVE EXPENSES
in € thousands
2020
2019
Server expenses to be recharged to subsidiaries
Personnel costs and related costs*
47
6,031
3,432
3,595
Professional services, consulting and other headcount
related costs
1,239
1,534
Marketing costs
270
1,091
650
1,760
Other
Total general and administrative expenses
6,242
13,407
* Number of headcount in the Company as of 31 December 2020is 15 (31 December 2019: 15)
5
OTHER OPERATING EXPENSES
Other operating expenses amounting to €8 thousand correspond to impairments recognized on loans granted to
subsidiaries during the year 2020.
In 2019, the Company recognized an impairment in relation to their investment in the Heyzap platform through its
subsidiaries RNTS Germany Holding GmbH and Heyzap Inc. The Heyzap platform was acquired in 2016 and played an
important role in building an integrated platform resulting in the release of Fyber FairBid 2.0 in September 2019.
Following the successful launch of Fyber FairBid 2.0, the Heyzap platform was gradually sunset with the final shutdown
happening in March 2020. Based on an analysis of the remaining net assets of RNTS Germany Holding GmbH and its
subsidiary Heyzap Inc., investments in subsidiaries, other non-current and other current financial assets, and trade
receivables were impaired as follows:
169
Notes to the Company Financial Statements for the year ended 31 December 2020
2019
RNTS Germany
Holding GmbH
Heyzap
Inc.
in € thousands
Note
Total
Investment in subsidiaries
Other non-current financial assets
Trade and other receivables
Other current financial assets
Total
7
8
28
0
0
28
23,893
367
23,893
1,711
9
1,344
239
10
0
239
24,288
1,583
25,871
6
NET FINANCE COSTS
in € thousands
2020
2019
Interest from loans granted to subsidiaries, net
Foreign exchange income
Finance income
(4,348)
(228)
(4,576)
0
(5,746)
0
(5,746)
23,373
(6,713)
7,677
322
Loss from convertible bond conversion
Gain from convertible bond restructuring
Interest accrued on convertible bonds
Foreign exchange expense
Interest on loan from shareholders
Other
0
5,858
0
2,552
49
1,677
385
Finance costs
8,459
3,883
26,721
20,975
Total net finance costs
170
Notes to the Company Financial Statements for the year ended 31 December 2020
7
INVESTMENT IN SUBSIDIARIES
Fyber
GmbH
Fyber
Monetization Ltd.
RNTS Germany
Holding GmbH
in € thousands
Total
1 Jan 2020
128,920
73,766
0
202,686
Stock option
contribution
80
848
0
928
Impairment
0
0
0
0
31 Dec 2020
129,000
74,614
0
203,614
1 Jan 2019
128,561
73,357
28
201,946
Stock option
contribution
359
409
0
768
Impairment
0
0
(28)
(28)
31 Dec 2019
128,920
73,766
0
202,686
The stock option program of the Company is applied for employees of the subsidiaries consistently. The subsidiaries are
not obligated to reimburse the Company. The impairment of the investment in RNTS Germany Holding GmbH followed
the plan of sunsetting the Heyzap Platform. Please refer to note 5 or further details.
171
Notes to the Company Financial Statements for the year ended 31 December 2020
8
OTHER NON-CURRENT FINANCIAL ASSETS
Fyber RTB
GmbH
RNTS
Germany
Holding
GmbH
RNTS Media
Deutschland
GmbH
Fyber
Monetiza
tion Ltd
Fyber
GmbH
in € thousands
Total
1 Jan 2020
64,291
1,046
(382)
0
0
0
8
0
955
0
65,337
Increase, net
Impairment
0
0
6
(6)
0
587
(14)
(8)
0
Interest accrued
31 Dec 2020
4,213
68,504
193
0
4,406
70,316
857
0
0
955
1 Jan 2019
59,441
601
0
1,046
0
22,474
0
0
0
0
0
0
0
0
0
0
0
81,915
1,647
Increase
Impairment
Interest accrued
31 Dec 2019
0
(23,893)
1,419
0
(23,893)
5,668
4,249
64,291
0
1,046
65,337
In 2020 Fyber N.V. granted a new loan to Fyber Monetization Ltd. The loan bears 8% interest with maturity date as of
30 June 2022.
The increase of the loans granted to Fyber GmbH and Fyber RTB GmbH relates to reclassification of loans including
accrued interest thereon from current to non-current. Please refer to note 10 for further detail.
An impairment of the loan to RNTS Germany Holding GmbH was recognized as a result of the upcoming sunset of the
Heyzap platform. Please refer to note 5 for further details.
The interest rates of loans to subsidiaries companies are as follows:
Interest rate p.a.
Fyber GmbH
8%
7.8-8%
7.8%
Fyber RTB GmbH
RNTS Germany Holding GmbH
172
Notes to the Company Financial Statements for the year ended 31 December 2020
9
TRADE AND OTHER RECEIVABLES
in € thousands
31 Dec 2020
31 Dec 2019
Subsidiaries
14,865
138
11,815
366
VAT
Others
214
45
Total trade and other receivables
15,217
12,226
In 2019 the Company recognized impairment losses of trade receivables relating to the subsidiaries RNTS Germany
Holding GmbH and Heyzap Inc. amounting to € 1,711 thousand. Please refer to note 5 for further details.
10
OTHER CURRENT FINANCIAL ASSETS
Impairment /
reversal of
in € thousands
1 Jan 2020
Increase
Decrease
31 Dec 2020
impairment
Fyber Monetization
Ltd
0
48
0
0
48
Fyber GmbH
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Fyber RTB GmbH
Heyzap Inc.
Total
0
0
48
48
in € thousands
Fyber Monetization Ltd.
Fyber GmbH
1 Jan 2019
Increase
Decrease
Impairment
31 Dec 2019
0
0
0
0
0
0
0
0
0
0
601
983
(601)
(1,046)
0
0
0
Fyber RTB GmbH
Heyzap Inc.
63
15
224
(239)
(239)
Total
1,808
78
(1,647)
In 2020 the Company recorded interest on the loan granted to Fyber Monetization Ltd. Please refer to note 8 for further
details.
173
Notes to the Company Financial Statements for the year ended 31 December 2020
In 2019 the decrease in the loans granted to Fyber GmbH and Fyber RTB GmbH relates to reclassification from current
to non-current as it is not expected that these loans will be repaid within the next 12 months. Please refer to note 8 for
further details.
The loan directly granted to Heyzap Inc. was impaired following a plan to sunset the Heyzap platform. Please refer to
note 5 for further details.
The interest rates of loans to subsidiaries are as follows:
Interest rate p.a.
Fyber GmbH
7.8%
7.8% - 8.0%
8.0%
Fyber RTB GmbH
Heyzap Inc., Fyber Monetization Ltd.
11
CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash at banks that is freely available.
12
EQUITY
For a breakdown and a development of equity please refer to the Company statement of changes of equity.
The consolidated financial statements as of 31 December 2020 report a positive net equity position of €14,862 thousand
(2019: €33,076 thousand positive position) The Company financial statements as of 31 December 2020 report a positive
net equity of €172,003 thousand (2019: €173,136 thousand).
The following table shows the reconciliation of consolidated and Company equity for the year ended 31 December 2020
and 2019:
in € thousands
31 Dec 2020
14,862
31 Dec 2019
33,076
Total consolidated equity
Individual subsidiaries accumulated profit
Other comprehensive income, accumulated
Eliminations and profit of subsidiaries accumulated
Total company equity
142,371
(6,711)
125,496
(255)
21,481
14,819
173,136
172,003
174
Notes to the Company Financial Statements for the year ended 31 December 2020
Fyber N.V.’s investments in its subsidiaries are accounted for using the cost method. Under the cost method, the
investments in the subsidiaries are carried in the Company financial statements at cost less accumulated impairment.
Changes in the net asset value of the subsidiaries are not recognized in the Company financial statement while they do
fully affect the equity carried in the consolidated financial statements.
The following table shows the reconciliation of consolidated and Company net income for the year ended 31 December
2020 and 2019:
in € thousands
31 Dec 2020
(15,500)
31 Dec 2019
(48,769)
Total consolidated loss for the year
Individual subsidiaries profit after tax
Eliminations
3,961
6,664
17,041
(15,172)
Total Company’s loss for the year
(4,875)
(46,900)
13
NON-CURRENT LOANS AND BORROWINGS
As of the reporting date, the Company were had long-term borrowings carried at values as follows:
in € thousands
Convertible bond
Loan from Tennor
Total
31 Dec 2020
73,419
% rate
31 Dec 2019
70,489
% rate
3.5%
8.0%
3.5%
8.0%
36,788
32,236
102,725
110,207
For further details to the convertible bonds and convertible bond restructuring, please refer to note 5 of the notes to the
consolidated financial statements.
In terms of loan from Tennor, please refer to note 30 non-current loans and borrowings of the notes to the consolidated
financial statements.
175
Notes to the Company Financial Statements for the year ended 31 December 2020
14
TRADE AND OTHER PAYABLES
The following table shows the elements of the trade and other payables:
in € thousands
31 Dec 2020
31 Dec 2019
Subsidiaries
5,501
317
1,952
404
Accrued expenses
Inneractive earn-out due within a year
Trade payables
0
357
199
182
Other
1,255
7,272
1,252
4,147
Total trade and other payables
176
Notes to the Company Financial Statements for the year ended 31 December 2020
15
MATURITY ANALYSIS OF FINANCIAL LIABILITIES
Within
1 years
1 years to 5
years
in € thousands
Total
> 5 years
2020
Non-current loans and borrowings –
0
0
0
73,419
73,419
convertible debt
Non-current loans and borrowings
from Tennor
36,788
0
0
36,788
Current loans and borrowings
Current employee benefits
Trade and other payables
0
149
0
0
0
0
0
149
7,272
7,421
0
0
7,272
Total 2020
117,628
110,207
2019
Non-current loans and borrowings –
70,489
32,236
0
0
70,489
32,236
0
0
convertible debt
Non-current loans and borrowings
from Tennor
Current loans and borrowings
Current employee benefits
Trade and other payables
0
739
0
739
0
0
0
0
0
0
0
4,147
4,147
4,886
Total 2019
107,611
102,725
16
CAPITAL MANAGEMENT
in € thousands
31 Dec 2020
31 Dec 2019
Non-current loans and borrowings
Cash and cash equivalents
Net debt (cash)
102,725
(304)
110,207
(201)
102,421
110,206
177
Notes to the Company Financial Statements for the year ended 31 December 2020
17
FINANCIAL ASSETS AND LIABILITIES
17.1.
Categories of financial assets and liabilities
The carrying values of financial assets and liabilities per category are as follows:
31 Dec 2020
31 Dec 2019
Measured at
Measured at
Total
Total
amortized costs
amortized costs
Investment in
subsidiaries
203,614
70,316
15,217
48
203,614
70,316
15,217
48
202,686
202,686
Other non-current
financial assets
65,337
12,226
0
65,337
12,226
0
Trade and other
receivables
Other current financial
assets
Cash and cash
equivalents
201
201
304
304
Total financial assets
289,396
289,396
280,558
280,558
31 Dec 2020
31 Dec 2019
in € thousands
Measured at
amortized costs
Measured at
amortized costs
Total
Total
Non-current loans and
borrowings
110,207
7,272
110,207
7,272
102,725
4,147
102,725
4,147
Trade and other
payables
Short-term employee
benefit liabilities
149
149
739
739
Total financial
liabilities
117,628
117,628
107,611
107,611
17.2.
Fair value measurement of financial assets and liabilities
Except for the convertible bonds, carrying values are reasonable approximations of the respective fair values. Please
refer to notes5 and 30 of the notes to the consolidated financial statements for further information on the convertible
bond. and note 39.3 of the notes to the consolidated financial statements for further information regarding the fair value
hierarchy.
178
Notes to the Company Financial Statements for the year ended 31 December 2020
17.3.
Net results by measurement category
1 Jan - 31 Dec 2020
Recognized through profit and loss
From valuation
From
interest
(Impairment)
Impairment
reversal, net
Net
results
Currency
effect
in € thousands
Revaluation
Financial assets
Measured at amortized costs
Financial liabilities
Measured at amortized costs
Total
4,348
785
0
427
5,560
0
0
0
(8,459)
25
0
(8,434)
(4,111)
810
427
(2,874)
In 2020, an operating income from the reversal of prior year impairment relating to trade receivables towards Heyzap
Inc. had been recognized. The company could actually collect € 435 thousand. In return, impairments amounting to € 8
thousand on two shareholder loans granted to RNTS Germany Holding GmbH and RNTS Deutschland GmbH were
recognized.
1 Jan - 31 Dec 2019
Recognized through profit and loss
From valuation
From
Net
in € thousands
interest
Currency
effect
results
Revaluation
Impairment
(25,871)
Financial assets
Measured at amortized costs
Financial liabilities
Measured at amortized costs
Total
5,746
59
0
(20,066)
(9,735)
75
(16,660)
0
(26,320)
(3,989)
134
(16,660)
(25,871)
(46,386)
In 2019, a net loss from revaluation was recognized resulting from the restructuring of the convertible bonds of €16,660
thousand (€23,373 loss coming from bond conversion and €6,713 income resulted from convertible bond restructuring).
In 2019, financial assets relating to RNTS Germany Holding GmbH and Heyzap Inc. have been impaired amounting to
€ 25,871 thousand.
179
Notes to the Company Financial Statements for the year ended 31 December 2020
18
FINANCIAL RISK MANAGEMENT
Please refer to note 39 of the notes to the consolidated financial statements for further information regarding the
financial risk management of the comprehensive Group including the Company.
19
RELATIONSHIPS WITH RELATED PARTIES
Outstanding balances and transactions
19.1.
The following table provides the balances with related parties as at 31 Dec 2020 and 2019 as well as the total amount
of transactions that have been entered with related parties during 2020and 2019:
2020
Amounts owed
by parties
Amounts owed
to parties
Sales to
parties
Purchases
from parties
in € thousands
Subsidiaries
Advertile Mobile GmbH
0
2
0
0
1
0
1
Falk Realtime Ltd
Fyber GmbH
150
2,276
148
0
74,148
7
960
0
482
374
0
Fyber Inc.
Fyber Media GmbH
Fyber Monetization Ltd.
Inneractive USA, Inc.
Fyber RTB GmbH
Heyzap Inc.
3,152
7,355
0
897
2,604
615
3
2,850
2,682
621
1
0
1
1,213
0
0
0
0
RNTS Germany Holding
GmbH
0
0
0
0
RNTS Media Deutschland
GmbH
2
0
0
0
0
0
Key management personnel
Shareholder
0
3,044
Tennor Holding B.V.
Total
0
36,788
0
2,552
85,879
42,584
4,709
9,757
180
Notes to the Company Financial Statements for the year ended 31 December 2020
2019
Amounts owed
by parties
Amounts owed
to parties
Sales to
parties
Sales to
parties
in € thousands
Subsidiaries
Advertile Mobile GmbH
234
2
17
128
1,368
123
0
45
0
0
0
Falk Realtime Ltd
Fyber GmbH
70,224
8
2,152
0
368
570
0
Fyber Inc.
Fyber Media GmbH
Fyber Monetization Ltd.
Inneractive USA, Inc.
Fyber RTB GmbH
Heyzap Inc.
2,440
3,334
0
2,026
7,781
0
819
211
2,422
577
0
1,390
243
12
414
0
596
0
RNTS Germany Holding
GmbH
0
0
0
0
RNTS Media Deutschland
GmbH
2
0
0
0
0
Key management personnel
Shareholder
0
289
1,454
Tennor Holding B.V.
Total
0
32,236
0
1,677
77,877
35,203
13,014
7,068
Sales from and to subsidiaries include charges for management and shared services.
The purchases from key management personnel consist of compensation of €3,044 thousand (2019: €1,454 thousand).
In 2019, amounts owed by RNTS Germany Holding GmbH of €24,260 thousand and Heyzap Inc. of €1,583 thousand were
impaired. No such impairment was recognized in 2020. Please refer to note 5 for further details.
181
Notes to the Company Financial Statements for the year ended 31 December 2020
19.2.
Compensation for key management personnel
Compensation for key management personnel for the year ended 31 December 2020 and 2019 are as follows:
in € thousands
31 Dec 2020
31 Dec 2019
Share-based payments
579
1,258
975
0
(115)
1,128
220
0
Short-term employee benefits
Variable benefits
Termination benefits
Defined contribution plan
Total compensation for key management personnel
232
221
3,044
1,454
The amounts shown in the table above are those recognized as an expense during the reporting period related to key
management personnel. Key management personnel include any person that has the authority and responsibility for
planning, directing and controlling the activities of the entities, directly or indirectly. The compensation for members of
the management board and supervisory board of the Company are as follows:
182
Notes to the Company Financial Statements for the year ended 31 December 2020
in € thousands
Management Board
Ziv Elul1
Type
2020
2019
Share-based payments
Short-term employee benefits
Variable benefits
287
330
450
80
29
342
133
83
Defined contribution plan
Total
1,147
146
587
(71)
284
77
Daniel Sztern2
Share-based payments
Short-term employee benefits
Variable benefits
276
263
82
Defined contribution plan
Total
69
767
146
359
(73)
305
10
Yaron Zaltsman2
Share-based payments
Short-term employee benefits
Variable benefits
276
263
69
Defined contribution plan
Total
69
754
2,668
311
Total Management Board
1,257
Supervisory Board
Karim Sehnaoui3
Yair Safrai4
Short-term employee benefits
Short-term employee benefits
Short-term employee benefits
Short-term employee benefits
Short-term employee benefits
57
119
50
76
Arjun Metre5
57
46
Franklin Rios6
Tarek Malak7
86
25
57
0
Total Supervisory Board
Total
376
3,044
197
1,454
1 Member since June 15, 2016
2 Member since July 25, 2017
3 Member since October 1, 2017
4 Member since October 1, 2018
5 Member since January 31, 2019
6 Member since July 1, 2019
7 Member since Oct 30, 2019
183
Notes to the Company Financial Statements for the year ended 31 December 2020
19.3.
Finance income and expenses with related parties
The following table summarizes the financial income and expenses of the Company from its related parties in 2020 and
2019:
2020
2019
Finance
income
Finance
expense
Finance
income
Finance
expense
in € thousands
Subsidiaries
Fyber GmbH
4,216
0
0
0
0
4,247
0
300
0
Fyber Monetization Ltd.
Fyber RTB GmbH
Heyzap Inc.
73
59
0
0
63
15
0
RNTS Germany Holding
GmbH
0
0
1,421
0
Total
4,348
0
5,746
300
20
OFF-BALANCE SHEET LIABILITIES
20.1.
Guarantee
In 2017 Fyber N.V. entered in 2 different loan agreements as guarantor, as following:
1.
In 2017 Fyber N.V. entered into a loan agreement between BillFront GmbH and Fyber GmbH as a guarantor
for Fyber GmbH.
The company guarantees to indemnify outstanding obligations from Fyber GmbH. The entire guarantee
amounts up to the entire facility credit of €7,500 thousand. As of 31 December 2020 an amount of €3,227
thousands had been withdrawn (31 December 2019: €4,491 thousand). Please refer to note 33 of the notes to
the consolidated financial statements for further information.
2.
3.
In 2017 Fyber N.V. entered into a revolving credit facility agreement between bank Leumi and Fybe
Monetization Ltd as a guarantor for Fyber Monetization Ltd.
r
The company guarantees to indemnify outstanding obligations from Fyber Monetization Ltd. The entire
guarantee amounts up to the entire facility credit of $12,500 thousand as of 31 December 2020 (31 December
2019: $15,000). As of 31 December 2020 an amount of $12,500 thousand had been withdrawn. Please refer to
note 33 of the notes to the consolidated financial statements for further information.
In 2020 Fyber N.V. entered into a revolving credit facility agreement between bank Discount and Fyber
Monetization Ltd as a guarantor for Fyber Monetization Ltd.
The company guarantees to indemnify outstanding obligations from Fyber Monetization Ltd. The entire
guarantee amounts up to the entire facility credit of $10,000 thousand as of 31 December 2020. As of 31
December 2020 an amount of $9,792 thousand had been withdrawn. Please refer to note 33 of the notes to
the consolidated financial statements for further information.
184
Notes to the Company Financial Statements for the year ended 31 December 2020
20.2.
Fiscal unity for Value Added Tax ('VAT') purposes
The Company is the head of a fiscal unity for German VAT purposes with Fyber GmbH, Fyber Media GmbH, Fyber RTB
GmbH, Falk Realtime Limited and Advertile Mobile GmbH as controlled entities. The head of the fiscal unity prepares
the overall VAT return including all controlled entities of the fiscal unity. Therefore, the Company has a joint liability
concerning the German VAT due by any of these companies.
21
AUDITORS FEE
The following fees have been recognized in other operating expenses:
in € thousands
2020
2019
KPMG
Accountants
N.V.
Other
KPMG
Network
KPMG
Accountants
N.V.
Other
KPMG
Network
Total
KPMG
Total
KPMG
Audit of the financial
statements
194
310
504
137
280
417
Tax-related advisory
services
0
0
0
0
8
8
Total
194
307
501
137
288
425
The above mentioned audit fees relate to the audit of the financial year 2020 and 2019 respectively and do not represent
the costs expensed during the year.
22
REMUNERATION OF THE MANAGEMENT BOARD AND SUPERVISORY BOARD
The composition of the management board and supervisory board is the same for both, the Company and the Group.
Therefore, please refer to note 41.2 and 41.3 of the notes to the consolidated financial statements for information
regarding the remuneration of the management board and the supervisory board.
185
Notes to the Company Financial Statements for the year ended 31 December 2020
23
SUBSEQUENT EVENTS
Please refer to note 44 of the notes to the consolidated financial statements for information regarding significant events
after the balance sheet date.
Amsterdam, 30 April 2021
The Supervisory Board
The Management Board
Yair Safrai, Chairman of the Supervisory Board
Tarek Malak, Chairman of the Audit Committee
Ziv Elul, CEO
Yaron Zaltsman, CFO
24
OTHER INFORMATION
According to the article 30 of the articles of association as of 14 June 2017 the management board, with the approval
of the supervisory board, may decide that part of the profit realized during a financial year be set aside to increase
and/or form reserves. The remaining profit will be put at the disposal of the general meeting.
Distributions may be made only insofar as the Company’s equity exceeds the amount of the paid in and called up part
of the issued capital, increased by the reserves which must be kept by virtue of the law or theses articles of association
(see article 30.7).
The management proposes, regarding the distribution of the result for the year 2020, to add the losses to the
accumulated deficit.
Auditor’s report
The auditor’s report with respect to the separate financial statements is set out on the next pages.
186
Independent auditor's report
To: the General Meeting of Shareholders and the Supervisory Board of Fyber N.V.
Report on the audit of the financial statements 2020 included in the annual report
Our opinion
In our opinion the accompanying financial statements give a true and fair view of the financial
position of Fyber N.V. as at 31 December 2020 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 financial statements 2020 of Fyber N.V. (hereafter: “the Company”) based
in Amsterdam, the Netherlands.
The financial statements comprise:
1 the consolidated and company statement of financial position as at 31 December 2020;
2 the following consolidated and company statements for 2020: the income statement, the
statements of comprehensive income, the statements of changes in equity and cash flows;
and
3 the notes comprising a summary of the significant accounting policies and other explanatory
information.
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on
Auditing. Our responsibilities under those standards are further described in the ‘Our
responsibilities for the audit of the financial statements’ section of our report.
We are independent of Fyber N.V. in accordance with the ‘Verordening inzake de
onafhankelijkheid van accountants bij assurance-opdrachten’ (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).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
187
Material uncertainty related to going concern
We draw attention to the going concern paragraph (note 1.3) in the notes of the financial
statements which indicates that the going concern of the Company depends on the willingness of
the lenders to continue financing the Company for the next 12 months after issuance of these
financials. These conditions indicate the existence of a material uncertainty which may cast
significant doubt about the Company’s ability to continue as a going concern. Our opinion is not
modified in respect of this matter.
Audit approach
Summary
Materiality
Consolidated financial statements
— Materiality of EUR 1,240 thousand
— 0.6% of consolidated revenue
Company financial statements
— Materiality of EUR 2,200 thousand
— 0.8% of total assets
Group audit
— 98% of consolidated total assets
— 100% of consolidated revenue
Key audit matters
— Impairment testing on goodwill
— Fraudulent revenue recognition
Opinion
Unqualified opinion with material uncertainty related to going concern
Materiality
Based on our professional judgement we determined the materiality for the consolidated financial
statements as a whole at EUR 1,240 thousand (2019: EUR 720 thousand) and for the company
financial statements as a whole at EUR 2,200 thousand (2019: EUR 525 thousand).
188
The materiality for the consolidated financial statements is determined with reference to
consolidated revenue (0.6% (2019: 0.6%)). We consider revenue as the most appropriate
benchmark because the main focus of stakeholders is, amongst other metrics, on revenue.
Additionally, revenue appears to be less volatile than other benchmarks, such as profit before
taxes due to the fact the Group is in a loss-making situation in combination with the fact that the
Group is still in a start-up (growth) phase.
The materiality for the company financial statements is determined with reference to total assets
(0.8% (2019: 0.2%)). We consider total assets as the most appropriate benchmark given the
primary nature of the parent Company’s activities, the holding of investments.
The benchmarks for both consolidated and company financial statements did not change from
prior year. Materiality for both consolidated and company financial statements significantly
changed compared to last year due to a higher amount of the benchmarks and percentages
applied to determine materiality.
For the following significant disclosure we applied the following materiality:
— Remuneration of Management and Supervisory Board disclosure: EUR 10 thousand.
We have also taken into account misstatements and/or possible misstatements that in our
opinion are material for the users of the consolidated and separate financial statements for
qualitative reasons.
We agreed with the Supervisory Board that misstatements in excess of EUR 62 thousand and
EUR 110 thousand which are identified during the audit of the consolidated and company
financial statements respectively, would be reported to them, as well as smaller misstatements
that in our view must be reported on qualitative grounds.
Scope of the group audit
Fyber N.V. is at the head of a group of components. The financial information of this group is
included in the financial statements of Fyber N.V.
Our group audit mainly focused on significant components (namely Fyber Monetization Ltd.,
Fyber Media GmbH and Fyber GmbH) that are of individual financial significance to the group.
We have:
— made use of the work of KPMG Israel and KPMG Germany for the audit of Fyber
Monetization Ltd., Fyber Media GmbH and Fyber GmbH;
— set component materiality levels, which ranged from EUR 263 thousand to EUR 949
thousand, based on the mix of size and financial statement risk profile of the components
within the group to reduce the aggregation risk to an acceptable level;
— provided detailed instructions to the component auditors, covering amongst others the
significant risks of material misstatement, and the information required to be reported back to
the group audit team;
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— for the components in scope of the group audit, held conference calls and virtual meetings
with the auditor of significant components. During these meetings and calls, the planning, risk
assessment, procedures performed, findings and observations reported to the group auditor
were discussed in more detail and any further work deemed necessary by the group audit
team was then performed;
— reviewed the work performed by KPMG Israel in our group audit file;
— performed audit procedures ourselves at Fyber N.V. with respect to compliance with specific
Dutch disclosure requirements and those related to communication to those charged with
governance.
In view of restrictions on the movement of people across borders, and also within significantly
affected countries, we considered changes to the planned audit approach to evaluate the
component auditors’ communications and the adequacy of their work. According to our original
audit plan, we intended to visit the component auditor in Tel Aviv (Israel) to review selected
component auditor documentation. Due to the aforementioned restrictions, this was not
practicable in the current environment. As a result, we have requested those component auditors
to provide us with transfer of audit workpapers to perform these evaluations, subject to local law
and regulations. In addition, due to the inability to arrange in-person meetings with such
component auditors, we have increased the use of alternative methods of communication with
them, including through written instructions, exchange of emails and virtual meetings.
For the residual population not in scope we performed analytical procedures in order to
corroborate that our scoping remained appropriate throughout the audit.
By performing the procedures mentioned above at group components, together with additional
procedures at group level, we have been able to obtain sufficient and appropriate audit evidence
about the group’s financial information to provide an opinion about the financial statements.
This resulted in an audit coverage of 97% of total assets and 100% of total revenues.
Our focus on the risk of fraud and non-compliance with laws and regulations
Our objectives
The objectives of our audit with respect to fraud and non-compliance with laws and regulations
are:
With respect to fraud:
— to identify and assess the risks of material misstatement of the financial statements due to
fraud;
— to obtain sufficient appropriate audit evidence regarding the assessed risks of material
misstatement due to fraud, through designing and implementing appropriate audit responses;
and
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— to respond appropriately to fraud or suspected fraud identified during the audit.
With respect to non-compliance with laws and regulations:
— to identify and assess the risk of material misstatement of the financial statements due to
non-compliance with laws and regulations; and
— to obtain a high (but not absolute) level of assurance that the financial statements, taken as a
whole, are free from material misstatement, whether due to fraud or error when considering
the applicable legal and regulatory framework.
The primary responsibility for the prevention and detection of fraud and non-compliance with laws
and regulations lies with the Management Board, with oversight by the Supervisory Board. We
refer to the chapter 'Risk Management' of the Report of the Management Board contained in
the Annual Report where the Management Board included its risk assessment and where
the Supervisory Board reflects on this assessment.
Our risk assessment
As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect to
financial reporting fraud, misappropriation of assets and bribery and corruption. We evaluated the
fraud risk factors to consider whether those factors indicated a risk of material misstatement due
to fraud.
In addition, we performed procedures to obtain an understanding of the legal and regulatory
frameworks that are applicable to the Group and we inquired the Management Board and the
Supervisory Board as to whether the entity is in compliance with such laws and regulations and
inspected correspondence, if any, with relevant licensing and regulatory authorities.
The potential effect of the identified laws and regulations on the financial statements varies
considerably.
Firstly, the Group is subject to laws and regulations that directly affect the financial statements,
including taxation and financial reporting. We assessed the extent of compliance with these laws
and regulations as part of our procedures on the related financial statement items and therefore
no additional audit response is necessary.
Secondly, the Group is subject to many other laws and regulations where the consequences of
non-compliance could have an indirect material effect on amounts recognized or disclosures
provided in the financial statements, or both, for instance through the imposition of fines or
litigation.
We identified the data privacy as the most likely to have such an indirect effect.
In accordance with the auditing standard we evaluated the following fraud risks and non-
compliance that are relevant to our audit, including the relevant presumed risks:
— fraud risk in relation to revenue recognition, being the risk with respect to an overstatement of
revenues throughout the year and during the cut-off period close to the financial year-end
(the presumed risk); and
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— fraud risk in relation to management override of controls to meet targets and/or expectations
(the presumed risk).
We communicated the identified risks of fraud and non-compliance throughout our team and
remained alert to any indications of fraud and/or non-compliance throughout the audit. This
included communication from the Group to component audit teams of relevant risks of fraud and/
or non-compliance identified at group level.
In all of our audits, we addressed the risk of management override of internal controls, including
evaluating whether there was evidence of bias by management that may represent a risk of
material misstatement due to fraud.
We communicated our risk assessment and audit response to the Management Board and the
Supervisory Board. Our audit procedures differ from a specific forensic fraud investigation, which
investigation often has a more in-depth character.
Our response
We performed the following audit procedures (not limited) to respond to the assessed risks:
— We evaluated the design and the implementation of internal controls that mitigate fraud risk.
In case of internal control deficiencies, where we considered there would be opportunity for
fraud, we performed supplemental detailed risk-based testing.
— We performed data analysis of high-risk journal entries and evaluated key estimates and
judgements for bias by the Company, including retrospective reviews of prior year's
estimates. Where we identified instances of unexpected journal entries or other risks through
our data analytics, we performed additional audit procedures to address each identified risk.
These procedures also included testing of transactions back to source information.
— Assessment of matters reported on the Company's incident register/whistleblowing and
complaints procedures with the entity and results of management's investigation of such
matters.
— With respect to the risk of fraud in revenue recognition, we refer to the key audit matter
‘Fraudulent revenue recognition’.
— With respect to the fraud risk in relation to management override of controls, we evaluated
the appropriateness of the accounting for significant transactions that are outside the nomal
course of business or are otherwise unusual (if any).
— With respect to the risk of bribery and corruption across various countries, we evaluated the
Company's procedures such as due diligence procedures on third parties. We considered the
possibility of fraudulent or corrupt payments made through third parties.
— We incorporated elements of unpredictability in our audit, such as: negative news search.
— We considered the outcome of our other audit procedures and evaluated whether any
findings or misstatements were indicative of fraud or non-compliance. If so, we re-evaluated
our assessment of relevant risks and its resulting impact on our audit procedures.
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— We obtained audit evidence regarding compliance with the provisions of those laws and
regulations generally recognized to have a direct effect on the determination of material
amounts and disclosures in the financial statements.
We do note that our audit is based on the procedures described in line with applicable auditing
standards. In addition to the requirements of the auditing standards we have performed the
following additional procedures:
— Involvement of unpredictability: negative news search and whistleblowing procedures.
— Evaluation as to whether integrity and the code of conduct is a topic on the agenda of the
management and those charged with governance.
We do note that our audit is not primarily designed to detect fraud and non-compliance with laws
and regulations and that management is responsible for such internal control as management
determines is necessary to enable the preparation of the financial statements that are free from
material misstatement, whether due to errors or fraud, including compliance with laws and
regulations.
The more distant non-compliance with indirect laws and regulations (irregularities) is from the
events and transactions reflected in the financial statements, the less likely the inherently limited
procedures required by auditing standards would identify it. In addition, as with any audit, there
remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal controls.
Our key audit matters
Key audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the financial statements. We have communicated the key audit
matters to the Management Board and Supervisory Board. The key audit matters are not a
comprehensive reflection of all matters discussed.
These matters were addressed in the context of our audit of the financial statements as a whole
and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Compared to last year, the key audit matter with respect to the convertible bonds accounting
treatment is not included, as the modification of the terms of the remaining (not converted bonds)
was concluded in 2019 and therefore it was a matter which specifically related to the 2019
financial year.
Impairment testing on goodwill
Description
As indicated in note 18, the carrying value of goodwill as at 31 December 2020 is EUR 128.7
million. The goodwill resulted from the acquisition of four platform businesses between 2014
and 2016. The goodwill relates to one cash generating unit (CGU) only.
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Under EU-IFRS the Company is required to test the amount of goodwill for impairment at least
annually. The impairment tests were considered to be significant to our audit due to the
complexity of the assessment process, judgements and assumptions which are affected by
expected future market and economic developments.
Our response
We evaluated the design and implementation of controls with respect to management’s annual
goodwill impairment testing process.
We challenged the CGU definition, cash flow projections included in the annual goodwill
impairment test and assessed the appropriateness of this and other data used by comparing
them to external and historical data, such as external market growth expectations, and by
analysing sensitivities in Fyber’s valuation model.
Our audit procedures included the involvement of a valuation specialist to assist us in
evaluating the assumptions, in particular the (terminal) growth and pre-tax discount rates, and
the valuation methodology and model used by the Company.
We applied sensitivity analysis and assessed possible biases of management, challenged the
overall outcome and consistency and the historical accuracy of management’s estimates and
retrospective review procedures.
We assessed the adequacy of the disclosure in note 18 to the consolidated financial
statements.
Our observation
We consider management’s key assumptions and estimates to be within the acceptable range
and we assessed that the disclosure in note 18 to be adequate in accordance with EU-IFRS .
Fraudulent revenue recognition
Description
Based on the business environment and the intended acquisition by a third party there is a
pressure to meet the requirements of third parties, to achieve bank covenant ratios, results
and financial (incentive) targets. In addition the major revenue generating business
processes are mainly based on manual interfaces between IT systems leading to an
opportunity to manipulate revenue. For revenues please refer to note 6 to the consolidated
financial statements.
Revenue recognition was significant to our audit because of the fraud risk relating to the
existence of the revenue recognized.
Our response
We evaluated the design and implementation of relevant anti-fraud revenue controls.
Our substantive audit procedures included, amongst others, detailed testing of high risk
journal entries and evaluation of management bias in relation to revenue recognition.
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In response to the risk of overstatement of revenue we selected and reconciled sales
transactions and accruals with supporting external source documentation such as customer
contracts. We inspected the sales contracts to determine whether significant risks and
rewards were transferred in the current year and inspected credit notes issued throughout
the year. In addition, we tested whether revenue was appropriately recognized by
performing credit notes testing after year-end.
Furthermore, we evaluated the revenue reconciliations between the IT systems which
management performed, and assessed the differences resulting from these reconciliation by
inspecting supporting documentation.
Our observation
The results of our procedures relating to the risks of revenue recognition were satisfactory.
Report on the other information included in the annual report
In addition to the financial statements and our auditor’s report thereon, the annual report
contains other information.
Based on the following procedures performed, we conclude that the other information:
— is consistent with the financial statements and does not contain material misstatements; and
— contains the information as required by Part 9 of Book 2 of the Dutch Civil Code.
We have read the other information. Based on our knowledge and understanding obtained
through our audit of the financial statements or otherwise, we have considered whether the other
information contains material misstatements.
By performing these procedures, we comply with the requirements of Part 9 of Book 2 of the
Dutch Civil Code and the Dutch Standard 720. The scope of the procedures performed is less
than the scope of those performed in our audit of the financial statements.
The Management Board is responsible for the preparation of the other information, including the
information as required by Part 9 of Book 2 of the Dutch Civil Code.
Report on other legal and regulatory requirements and ESEF
Engagement
We were engaged by the Annual Meeting of Shareholders as auditor of Fyber N.V. on 12 June
2019, as of the audit for the year 2019 and have operated as statutory auditor since that financial
year.
No prohibited non-audit services
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We have not provided prohibited non-audit services as referred to in Article 5 (1) of the
EU Regulation on specific requirements regarding statutory audits of public-interest entities.
European Single Electronic Format (ESEF)
Fyber N.V. has prepared its annual report 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 financial report made
up in XHTML format, including the partly tagged consolidated financial statements as included in
the reporting package by the Company, has been prepared in all material respects in
accordance with the RTS on ESEF.
Management is responsible for preparing the annual report including the financial statements in
accordance with the RTS on ESEF, whereby management combines the various components in
a single reporting package. Our responsibility is to obtain reasonable assurance for our opinion
whether the annual report in this reporting package, is in accordance with RTS on ESEF.
Our procedures taking into consideration Alert 43 of NBA (the 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 have been prepared 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 taggings have been applied and whether they are
in accordance with the RTS on ESEF.
Description of responsibilities regarding the financial statements
Responsibilities of the Management Board and the Supervisory Board for the
financial statements
The Management Board 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.
Furthermore, the Management Board is responsible for such internal control as management
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 Management Board is responsible for
assessing the Company’s ability to continue as a going concern. Based on the financial reporting
frameworks mentioned, the Management Board should prepare the financial statements using
the going concern basis of accounting unless the Management Board either intends to liquidate
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the Company or to cease operations, or has no realistic alternative but to do so. The
Management Board should disclose events and circumstances that may cast significant doubt on
the Company’s ability to continue as a going concern in the financial statements.
The Supervisory Board is responsible for overseeing the Company’s financial reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit engagement in a manner that allows us to obtain
sufficient and appropriate audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we
may not detect all material errors and fraud during our audit.
Misstatements can arise from fraud or error and 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 these financial statements. The materiality affects the nature, timing and
extent of our audit procedures and the evaluation of the effect of identified misstatements on our
opinion.
A further description of our responsibilities for the audit of the financial statements is included in
the appendix of this auditor's report. This description forms part of our auditor’s report.
Amstelveen, 30 April 2021
KPMG Accountants N.V.
A.P.A. Greebe RA
Appendix:
Description of our responsibilities for the audit of the financial statements
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Appendix
Description of our 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 included among others:
— 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 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 Management Board;
— concluding on the appropriateness of the Management Board’s use of the going concern basis
of accounting, and based on the audit evidence obtained, whether a material uncertainty
exists related to events 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. However, future
events or conditions may cause a 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.
We are solely responsible for the opinion and therefore responsible to obtain sufficient
appropriate audit evidence regarding the financial information of the entities or business activities
within the group to express an opinion on the financial statements. In this respect we are also
responsible for directing, supervising and performing the group audit.
We communicate with the Management Board and the Supervisory Board 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 submit an additional report to the audit committee in accordance with Article 11 of the EU
Regulation on specific requirements regarding statutory audits of public-interest entities. The
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information included in this additional report is consistent with our audit opinion in this auditor’s
report.
We provide the Management Board and the Supervisory Board with a statement that we have
complied with relevant ethical requirements regarding independence, and to communicate with
them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with the Management Board and the Supervisory Board, we
determine the key audit matters: those matters that were of most significance in the audit of the
financial statements. 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.
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