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Creating and Connecting Communities…

Myriad Group AG Annual Report 2012Myriad G

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OverviewFinancial highlights 2012 1

Myriad at a glance 2

Letter to shareholders 4

Business ReviewOur business 6

Corporate Governance Corporate governance report 2012 12

Financial Report 2012Management discussion and analysis of results 26

Consolidated financial statements 29

Notes to the consolidated financial statements 34

Report of the statutory auditor on the consolidated financial statements

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Statutory financial statements 72

Notes to the statutory financial statements 75

Report of the statutory auditor on the statutory financial statements

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Additional InformationInformation for investors 82

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Myriad Group AGAnnual Report 2012 1

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Financial highlights 2012

USD’millionsFY 2012

IFRSFY 2011

IFRS

Revenue 56.3 61.0

Adjusted gross profit1 28.3 42.9

EBITDA2 (6.1) 8.9

EBIT without non-recurring items, impairment and restructuring costs (26.0) (8.7)

EBIT (60.5) (15.1)

Net result (58.5) (15.9)

EPS (USD‘000 per share) (1.05) (0.33)

Operating cash flow (29.5) (4.0)

Cash and cash equivalents 5.9 25.9

Shareholders’ equity 34.0 47.8

Equity ratio in % 31.9% 48.1%

Total headcount at year end (FTE) 509 4771. Gross profit before amortisation, impairment and restructuring costs.2. EBITDA before non-recurring items and restructuring charges.

Mobile Services DivisionDevice Solutions Division

Sales per segment USDm

56%

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>26.3m

ServiceLicence

Sales by type USDm

56%

>30.1m

>26.2m

Myriad Group AGAnnual Report 20122

Myriad at a glance

Creating compelling communications services

> social

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> connected homeBuilding new entertainment experiences across mobile, tablet and TV


Dear Shareholders2012 has been a year of restructuring and, as a result, a difficult year for the company. Myriad entered 2012 with expectations of continuing its transition towards a communications services business and in April completed the acquisition of Synchronica plc, as part of that strategy.

The acquisition secured major customers, technology and expertise central to the success of Myriad in the social messaging space. However, it also brought with it significant liabilities and operational complexities that have proven challenging to address. As a result, we report today a loss for the year.

We enter 2013 with the process of transition near to completion. Myriad has a new management team that has delivered significant reductions in costs, and has rationalised its operations. It has also brought a new focus on meeting customer expectations, driving up product quality and delivering innovation. Our Mobile Services Division is close to completing a move towards a single, streamlined platform on which all of its messaging products are offered, and is now seeing increased success in driving subscriber and revenue growth. Our Device Solutions Division continues to make progress in developing social TV applications for the pay TV market sector, and is pleased to report significant early success with several TV platform operators including the leading pay TV company in the US, Comcast. The Board believes the business is now well positioned to return the business to profitability and deliver future growth.

New ManagementThe board was pleased to welcome new members of the management team to the company in the second half of the year following the stepping down of five members of the management team last year. In December 2012, Stephen Dunford joined Myriad as Chief Executive Officer. Stephen has a long track record of building value within telecommunications software and services businesses through a focus on innovation, product quality and team work. In September 2012, Mike Grant joined as Chief Marketing Officer. With over twenty years of experience in the mobile industry, Mike has worked with a range of operators, service providers and media companies to bring a range of innovative products and services to market. Ed Zylka, previously VP and GM Americas for Myriad Group, was promoted to the role of SVP and General Manager with full responsibility for the Device Solutions Division. We expect other announcements of key additions to the

management team to be made over the course of 2013. I am looking forward to working with Stephen, Mike and our other new colleagues within the management team through 2013 to realise Myriad’s long-term growth potential and build value within the business.

Reshaping the Business: Creating and Connecting CommunitiesValue in today’s communications industry is created when a company is seen to significantly enhance the scale, scope and relevance of the community of individuals that a user connects to. Whether it is through messages, posts or tweets, today’s consumers expect to be connected to the people and content that is important to them with services that are simple, straight forward to use and offer a distinctive, engaging experience.

Myriad is significantly reshaping its business with both mobile operators and TV platform operators to generate value in this way. Our Mobile Services Division is focussed on developing three propositions that our mobile operator customers tell us significantly enhance the communications experience of users: Myriad Updates (including Facebook for USSD), Messenger, and “Uni”. The Division is delivering those services in three major geographies, Latin America, India and Africa. 2012 saw the launch of a number of new customers for our Myriad Updates service, including Telefónica Argentina, Vodafone India, and four African operators within the Orange Group. We believe our three major customer groups, Telefónica, Orange Group and America Movil (acquired through the Synchronica acquisition); together with our relationships with other operators in India and SE Asia provide a good platform for generating significant subscriber growth and new monetisation opportunities for the company.

Our Device Solutions Division is focussed on enhancing and enriching the experience we bring to the users of pay TV services. We do this through our “Alien Vue” product that enables pay TV operators to offer users Android applications on non-Android equipment (e.g. set-top boxes). We also achieve this with our market leading Java VM solutions. We have achieved a significant contract win with US market and global media leader, Comcast, a customer we believe will be increasingly significant for the company over the coming years. Myriad was selected by Comcast to provide its Java VM to Comcast’s RDK software distribution, an initiative that has strong support from global TV platform operators as an alternative open source solution to Android for

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set-top boxes and we anticipate will be rolled out throughout the pay TV sector over the next 18 months.

Innovation and Product Quality Innovation and improving product quality will be central to Myriad’s success going forward. The new management team have taken significant steps in the last quarter of 2012 to improve the performance of the business, streamlining the development process and rationalising our platforms. The success of Myriad Updates, and in particular Facebook for USSD, has enabled us to significantly strengthen our relationship with Facebook. We see a number of innovation opportunities to substantially increase subscriber growth in this area. We see opportunities to utilise our skills in the TV and messaging space to create new communities around TV and the second screen, including social TV. Moving forward into 2013, the company will look to develop an environment where strategic partnerships and product innovation is encouraged within the respective development teams across the business. It will also establish a new innovation unit with a remit to seek out truly transformative innovation based on the extensive intellectual property resources that exist within the company.

Cost Management and FundingDuring 2012 Myriad implemented a number of operational initiatives to manage costs and return the company to profitability. These included the rationalisation of offices and development teams with a consolidation of skills, expertise and technology within key locations. As a result of these initiatives Myriad reduced its operational costs by one third.

An additional key step in reducing costs was the rationalisation of its messaging platforms post the acquisition of Synchronica. Following the acquisition the combined entity had seven platforms on which it offered a range of services to customers. We are rapidly moving to a position where we will be able to offer all services from our Unity platform developed and maintained in our Montreal development centre. By mid-2013 we will have completed this migration of customers and will start to see the benefits of this investment.

This process has been funded through the CHF 10 million (USD 10.8 million) share placement made in Q3 2012.

2012 Results and BeyondRevenue for 2012 was USD 56.3 million. This reflected lower market demand for legacy device software as feature phone volumes declined, as well as a lower than planned contribution from newer social messaging services due to slower deployments and increased complexity in the rationalisation process. The decline in revenue together with restructuring costs and impairment charges led to net losses of USD 58.5 million. The reorganisation and refocusing of the business was largely completed in 2012. The business now has, a substantially lower cost base entering 2013 and progress is being made to address product shortcomings and accelerate customer deployments. With the new initiatives around social networking within both business divisions and increased investment in service marketing, the Board believes the company is well placed to capitalise on its existing customer relationships and product portfolio. We are confident that robust execution could drive significant growth in subscribers and revenue through 2013.

ThanksThe Board of Directors and Senior Management team would like to take this opportunity to thank our team members for the commitment and contribution they have made to the business. We would also like to thank our customers for continuing to select Myriad as their business partner.

Finally, we would like to thank you, our shareholders, for your continued confidence and support in Myriad Group AG.

Sincerely,

Erik HansenChairman

Stephen DunfordCEO


Mobile Services DivisionMyriad’s Mobile Services Division’s suite of communications services allows network operators, device manufacturers and other partners to quickly deploy and monetise social networking, email and chat services across all of their market segments.

Myriad Updates Social without a data planMyriad Updates, is a simple and speedy text-based service that makes social networking, instant messaging and email accessible to users without a data plan or smartphone. Myriad is one of only two organisations worldwide partnering with Facebook to offer “Facebook for USSD”, seamless access to Facebook using USSD technology. Consumers use short codes on any GSM mobile phone to access Myriad Updates. Subscribers who previously had no access to mobile data can now connect to their favourite social networks and stay in touch with their friends on Facebook via Myriad Updates. In this way, Updates opens up new opportunities to introduce a market of over 4.5 billion consumers worldwide to the Internet. The service is provided as a hosted service for network operators and is currently offered by networks within the Orange Group, Telefónica, Vodafone and other major operator groups.

Two Business DivisionsMyriad operates two complementary business divisions to support its market leading position within Social Media and Connected Home.

Myriad’s Mobile Services Division has created a range of compelling communications applications which enable mobile operators to offer consumers new ways to experience Internet communications services such as social networking, messaging and email. Myriad provides these experiences across multiple device types, from basic mobiles to smartphones and tablets, helping consumers to connect, interact and share content in new ways.

Myriad’s Device Solutions Division provides TV platform operators and OEMs with a portfolio of Connected Home applications. This suite of applications and associated technology provides users with new entertainment and social communications experiences across mobile, tablet, and TV, helping TV operators to engage with their customers more effectively. The Division also supports Myriad’s unrivalled portfolio in mobile browsers, Java virtual machines and embedded messaging clients.

Each business division comprises personnel focused on product innovation, product development and sales to their target market. The divisions are supported by cross-divisional teams specialising in customer support, marketing, finance, IT and HR.

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Myriad “Uni”People centric integration of social, chat, email and SMS in a seamless unified solutionThe adoption of OTT messaging and social media services is having a significant impact on network operators traditional voice and text revenues and is resulting in them being marginalised from their position as trusted, mass market consumer brands.

Myriad Uni allows network operators to offer an alternative experience to standalone OTT services, by organising user communications around people, not services. Uni provides a rich messaging and voice communications service and presents information to the user from their most important contacts, regardless of whether that information comes from Facebook posts, a chat service, SMS, or email. As an own branded app, it enables network operators to provide consumers with a rich, people-centric user experience.

Myriad Uni supports feature & smartphone devices, enabling network operators to address multiple market segments. It also supports the creation of network operator branded IM communities, through the integration of Myriad Messenger.

Myriad MessengerDelivering own community instant messaging across any mobile deviceMyriad Messenger is a rich instant messaging service that enables network operators to offer a branded and feature rich chat service alongside or in competition to other OTT chat services such as Line and Whatsapp. Whereas a typical “OTT service” is made available only on smartphones, Myriad offers access to Messenger across multiple clients, enabling operators to reach and engage all segments of the market. In this way, operators in developing markets in particular can effectively offer a complement to services that are increasingly being used to substitute for SMS and voice communications.


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Device Solutions DivisionMyriad’s Device Solutions Division working with world class mobile device and set-top box OEMs, and pay TV providers, delivers innovative software solutions powering billions of mobile phones, tens of millions of cable set-top boxes and DVD Blu-ray players. As a global technology leader, our best-in class embedded software has been chosen by an increasing number of high-tech companies for its superior performance including Samsung, Comcast, Cisco, Mediatek, Pace, Softbank, Jcom and Motorola.

The convergence of our work on mobile, tablets and TV has led to the creation of a suite of exciting connected home solutions including app stores for the TV, media sharing and simple access to social networking services within a multi-device, multi-screen connected home environment.

Myriad Alien VueAccess Android applications on non-Android TVs & set-top boxesConsumers increasingly want to access apps, content and social media services on their TVs. Pay TV operators need solutions in order to support this new consumer demand and must innovate to keep pace with over the top content (OTT) providers. To deliver on this, pay TV operators must either leverage an existing ecosystem, or develop a proprietary alternative, a costly and risky endeavour.

Developers are primarily focused on creating apps for Android and Apple iOS, two very popular consumer propositions. So creating a new propriety app ecosystem is not a

commercially viable way to get enough content and to get it quickly. The flexibility offered by Android is therefore a good choice, but using full Android on a set-top box presents many challenges – including security, TV quality, and Google control of content, services and apps.

Myriad Alien Vue provides a middle way. It makes Android portable. Doing so enables Android apps to run on non-Android set-top boxes with a seamless user experience. Pay TV operators can retain their existing software, retain control over the ecosystem and control the deployment of apps and services including advertising. It also enables pay TV operators to mitigate the threat of OTT solutions and keep their customers engaged within their environment.

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Myriad Media ShareMulti-screen streaming within the home network, extending TV and media to every device in the homeThe growth of smartphones and tablets in the living room has seen the rise of second screen devices whilst watching TV. This new TV viewing experience now presents an opportunity for pay TV operators to enrich the user engagement in two ways: to extend content and services to these devices; and to use these devices to control and interact with media, content and services on the TV screens and around the home.

Myriad provides a suite of solutions leveraging DLNA and DTCP-IP standards for both set-top box and all end points (smartphones, tablets, PCs etc.). These enable media and content to be moved between devices seamlessly with screen switching and transcoding technology whilst providing intuitive user experiences and controls.

With Myriad’s RUI-HTML5 solution, pay TV operators can easily deploy new services to a wide range of end points with a consistent user experience and for a lower investment than proprietary solutions.


Myriad Social TVShare programmes, and chat with friends watching what you are watchingMore and more users are interacting with their social network connections whilst watching TV. This represents a fantastic opportunity for cable operators to enrich their services, increase customer engagement and add value from recommendations, advertising and other services.

Myriad’s social TV platform provides IM, chat and social functions – integrating Facebook and other networks, with a white label operator branded network. It gives cable operators more control and insight into the social experience. It integrates social as part of the existing user experience rather than making it a standalone app, and provides a full dual screen experience with user interactions across both the TV and the companion device.

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Centres of ExcellenceMyriad operates three global centres of excellence in Montreal (messaging), Paris (USSD) and Chambery (devices) to support customer requirements. Personnel within these locations equate to approximately 30% of Myriad’s global headcount. In addition Myriad operates three production centres in Chengdu (devices and mobile services), Manila (mobile services) and Mumbai (mobile operations), with staff accounting for 46% of total employees. These locations represent the focus of the company’s product development, and quality assurance activities.

The remaining 24% of staff are located in Myriad’s other offices across the globe with a focus on sales and service related activity. This office network provides a strong global footprint to effectively support existing and future customers.

CustomersMyriad’s two business divisions support over 100 network operators and 25 OEM relationships.


Myriad Group AG (the ‘Company’, together with its subsidiaries ‘Group’, ‘Myriad’ or ‘Myriad Group’) is committed to meeting the high standards of corporate governance that seek to balance transparency, entrepreneurship and control whilst ensuring efficient decision-making processes in view of shareholders’ interests.

This report explains how management and control of the Company are organised and provides background information on its corporate bodies and officers as of 31 December, 2012.

The following information complies with the SIX Swiss Exchange Directive on Information Relating to Corporate Governance (‘Directive Corporate Governance, DCG’). Certain key elements and information are contained in the Company’s Articles of Incorporation and Organisational Regulations1. In cases where required information is provided in other sections of this Annual Report, reference is made to the appropriate page number(s).

1. Group structure and shareholdersGroup structureThe organisational structure of the Group as of 31 December, 2012:

Corporate Governance Report 2012

Listed companyMyriad Group AG (formerly Esmertec AG), incorporated in 1999 as a joint-stock company, is domiciled at Bahnhofstrasse 64, 8021 Zurich, Switzerland, care of GHR Rechtsanwälte AG. At the 31 December, 2012 the Company was domiciled at Selnaustrasse 28, 8001 Zurich, Switzerland. The registered shares of the Company are listed on the Main Standard of SIX Swiss Exchange (Ticker symbol: MYRN; Swiss Securities Number: 1,962,480; ISIN Number: CH0019624805). The market capitalisation amounted to CHF 146.721 million as of 31 December, 2012. The Company held 20 of its own shares as of 31 December, 2012.

Non-listed companiesFor a table of the operational non-listed consolidated entities please refer to Note 32 of the consolidated financial statements of this Annual Report.

1. Current versions are displayed on www.myriadgroup.com – the direct links for the documents are mentioned in section ‘9. Information policy’ of this Corporate Governance Report.

Board of Directors Chairman

Erik Hansen

Chief Executive OfficerStephen Dunford

Board of DirectorsVice ChairmanDavid Arnott

Chief Technical Officer

Kim Hartlev

Chief Marketing Officer

Mike Grant

Chief FinancialOfficer

James Bodha

SVP & GM DeviceSolutions Division

Ed Zylka

Board of DirectorsBoard Member

Richard Schlauri


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Significant shareholdersPursuant to the information provided to the Company by its shareholders in compliance with the Swiss Stock Exchange Act during financial year 2012, the following shareholders held more than 3% of the share capital as of 31 December, 2012:

Name of shareholder Percentage held

Patinex AG, CH-Wilen1 21.99%

Sagem Telecommunications SA, FR-Paris Cedex2 5.09%

UBS Fund Management, CH-Basel 4.37%

1. Beneficial owners of the majority of shares in Patinex AG are Martin and Rosmarie Ebner, 8832 Wilen, Switzerland.2. The indirect holder of the shares held by Sagem Telecommunications SA is Safran Group, 2 Boulevard du Général Martin Valin, 75512 Paris Cedex 15, France.

As a summary, and based on the disclosure notices received by the Company, the following changes in significant shareholders occurred during the financial year 2012:

October 2012In conjunction with the capital increase in September 2012, BZ Bank Aktiengesellschaft, CH-Wilen disclosed in two different disclosure notices that as a result of allocating shares from the underwritten capital increase, its holding had gone below the 10% threshold limit to 6.63% as of 1 October, 2012 and below the 3% threshold limit as of 18 October, 2012.

September 2012In conjunction with the capital increase in September 2012, BZ Bank Aktiengesellschaft, CH-Wilen disclosed that it had fully underwritten all shares in the rights issue and its holding had gone above the 10% threshold limit to 10.89% as of 26 September, 2012.

Patinex AG, CH-Wilen disclosed that it had committed to execute all of the subscription rights it was entitled to in the capital increase in September 2012 and that it would also absorb all the newly issued shares for which the subscription rights were not executed. As a result of the commitment, its holding had gone above the 20% threshold limit to 21.99% as of 26 September, 2012.

Myriad Group AG, CH-Zurich disclosed that as a result of the capital increase in September 2012, its sale position (stock options from the employee stock option programme) had gone below the 3% threshold limit as of 26 September, 2012.

Balfidor Fondsleitung AG, CH-Basel disclosed that as a result of sale transactions, its holding had gone below the 3% threshold limit as of 26 September, 2012.

UBS Fund Management (Switzerland) AG, CH-Basel (including collective investment schemes with RoPas (CH) Institutional Equities Switzerland, which holds 3.29%) disclosed that as a result of sale transactions, its holding had gone below the 5% threshold limit to 4.37% as of 26 September, 2012.

April 2012In conjunction with the capital increase in April 2012, VEM Aktienbank AG, DE-Munich disclosed that it acted as intermediary broker in the transaction and as a result of underwriting the share issue, its holding had gone above the 10% threshold limit to 13.49% as of 13 April, 2012.

Simon Wilkinson, UK-Prestbury disclosed that as a result of the capital increase in April 2012, his holding (registered shares and employee call options) had gone below the 3% threshold limit as of 13 April, 2012.

Swiss & Global Asset Management AG, CH-Zurich (acting as a fund management company on behalf of several investment funds) disclosed that as a result of the capital increase in April 2012, its holding had gone below the 3% threshold limit as of 13 April, 2012.

Myriad Group AG, CH-Zurich disclosed that as a result of the capital increase in April 2012, its sale position (stock options from the employee stock option programme) had gone below the 5% threshold limit to 3.46% as of 16 April, 2012 (sale position as of 31 December, 2011 was 5.53%).

Patinex AG, CH-Wilen disclosed that as a result of the capital increase in April 2012, its holding had gone below the 15% threshold limit to 14.1% as of 18 April, 2012 (holding as of 31 December, 2011 was 15.74%).

VEM Aktienbank AG, DE-Munich (acting as intermediary broker) disclosed that as a result of allocating the shares in the capital increase to the relevant shareholders, its holding had gone below the 3% threshold limit as of 18 April, 2012.


January 2012Swiss & Global Asset Management AG, CH-Zurich (acting as a fund management company on behalf of several investment funds) disclosed that as a result of purchase transactions, its holding had gone above the 3% threshold limit to 3.07% as of 25 January, 2012.

For further details on the disclosure notices please refer to the reporting platform of SIX Swiss Exchange under: http://www.six-swiss-exchange.com/shares/companies/major_shareholders_en.html

The Company is not aware of any shareholders’ agreements.

Cross-shareholdingsMyriad Group AG has not entered into cross-shareholdings with other companies.

2. Capital structureShare capitalAs of 31 December, 2012, the Company has an ordinary share capital of CHF 6,113,366.00, consisting of 61,133,660 registered shares with a nominal value of CHF 0.10 each (60,841,865 shares registered in the commercial register as of year-end). The conditional capital amounts to CHF 289,889.10, consisting of 2,898,891 registered shares with a nominal value of CHF 0.10 each. The Company has no authorised unissued capital at 31 December, 2012.

Conditional and authorised share capital in particularConditional share capitalPursuant to article 3a of the Articles of Incorporation, dated 26 September, 2012, the share capital of Myriad Group AG may be increased through the issuance of a maximum of 3,190,686 registered shares, each fully paid-in, with a nominal value of CHF 0.10 each, in the maximum aggregate amount of CHF 319,068.60 by exercise of option rights which are granted to the members of the Board of Directors and employees of the Company and its subsidiaries as well as to the members of the Advisory Board according to one or several employee share option plans as approved by the Board of Directors. The subscription rights (Bezugsrechte) of the shareholders with respect to these shares shall be excluded.

Authorised share capital As of 31 December, 2012, the Company has no authorised capital outstanding.

Changes in capitalShareholders of Myriad Group AG approved the Board of Directors’ proposal at the Extraordinary General Meeting of Shareholders held on 23 February, 2012, to create authorised share capital in the amount of CHF 1,170,135.00 (11,701,350 registered shares), available for an increase in share capital at any time until 23 February, 2014. The issue price, the date of entitlement for dividends and the type of contribution shall be determined by the Board of Directors. The subscription rights of the shareholders with respect to the authorised share capital shall be excluded if the authorised share capital is used in order to enable the Company: (i) to offer to business partners of strategic importance a shareholding interest in the Company; or (ii) to acquire enterprises or parts thereof in exchange for shares of the Company.

The Company increased its share capital in April 2012 by CHF 766,555.20 (issuance of 7,665,552 registered shares in conjunction with the Synchronica acquisition) and in September 2012 by CHF 403,579.80 (issuance of 4,035,798 registered shares in conjunction with a rights issue offered to the shareholders) out of the authorised share capital. In addition, the share capital increased by CHF 29,179.50 (291,795 registered shares) as a result of shares issued out of conditional capital due to the exercise of employee stock options.

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The table below sets forth the changes in the capital of the last three reporting periods.

Ordinary share capital

Date

Capital as of 31 December, 2009 CHF 4,419,214

March 2010 CHF +436,8471


January – December 2011 CHF +57,9912

Capital as of 31 December, 2011 CHF4,914,052

April 2012 CHF +766,5551

September 2012 CHF +403,5801

January – December 2012 CHF +29,1792


Conditional share capital

Date

Capital as of 31 December, 2009 CHF 447,559

No changes in 2010 -


January – December 2011 CHF - 57,9902

Expiration of Convertible Notes CHF - 70,5003


January – December 2012 CHF - 29,1802


Authorised share capital

Date


March 2010 CHF - 436,8471

June 2010 remaining capital forfeited CHF - 527

Capital as of 31 December, 2010 -

No changes in 2011 -


February 2012 CHF+ 1,170,1354

April 2012 CHF - 766,5551

September 2012 CHF - 403,5801


1 Shares issued out of authorised capital. 2 Shares issued based on the exercise of stock options and conversion rights.3 Under the Articles of Incorporation, this capital still existed at year-end 2011. However, this conditional capital was tied to Convertible Notes that were repaid in 2011.

Therefore from a financial perspective, the capital was reduced by CHF 70,500.20. 4 Creation of authorised capital as approved by the General Meeting of Shareholders on 23 February, 2012.


Shares and participation certificatesAs of 31 December, 2012, the ordinary share capital of Myriad Group AG consists of 61,133,660 registered shares with a nominal value of CHF 0.10 each, all fully paid-in and entitled to dividend payments as determined by the General Meeting of Shareholders. At the General Meeting of Shareholders, each share carries one vote.

The Company has neither bearer shares, nor participation certificates outstanding.

Profit sharing certificatesThe Company does not have profit sharing certificates outstanding.

Limitations on transferability and nominee registrationsThe Company’s Articles of Incorporation do not contain limitations on the transferability of shares.

The Company maintains a share register in which the name, address and domicile (for legal entities the registered office) of the owners and usufructuaries of registered shares are recorded. The person recorded in the share register shall be deemed to be the shareholder or usufructuary in relation to the Company. The Company only recognizes one shareholder or usufructuary per share.

Regarding nominee registrations, the Company applies Art. 685d para. 2 of the Swiss Code of Obligations, with the consequence that nominees do not have voting rights.

Convertible bonds and optionsAs of 31 December, 2012, Myriad Group AG had no convertible bonds.

As of 31 December, 2012, Myriad Group AG had outstanding stock options granted to members of the Board of Directors, Senior Management and employees. For detailed information please refer to Note 11 ‘Employee compensation and benefits’ in the notes to the consolidated financial statements. The total of outstanding options can be exercised into 1,283,726 shares of the Company, which represents 2.1% of the outstanding share capital.

3. Board of DirectorsMembers of the Board of DirectorsAs of 31 December, 2012, the Company’s Board of Directors consists of three non-executive members. None of them has ever been a member of the Senior Management of Myriad Group AG or its subsidiaries, nor have any of them significant business connections with Myriad Group AG or its subsidiaries.

Erik HansenFunction Chairman Born/nationality 1952, Danish citizenFirst elected - 2012End of term - 2013 Committees - Chairman of the Compensation and Nominating Committee, Member of the Audit Committee

Professional and educational backgroundErik Hansen was the CEO of Day Software from May 2008, until November 2011 when the company was sold to Adobe Inc. He has more than 30 years’ experience in the IT and Telecommunications industries. From 2005 to 2008, he was SVP/GM at Interwoven, and from 2004 to 2005 was SVP EMEA at Netegrity. From 2000 to 2004 he was President EMEA/LATAM for TIBCO Software. From 1997 to 1999 he was EVP Worldwide field Operations at Pyramid Technology Inc. From 1994 to 1997 he served as CEO and President of TA Triumph Adler. From 1990 to 1994 he held the post of General Manager, Mobile at Apple. Prior to this role Mr Hansen held senior management posts at Wyse Technologies and Altos Computer Systems.

Other activities and vested interestsNone

David ArnottFunction Vice Chairman Born/nationality 1969, British citizenFirst elected - 2012End of term - 2013 Committees - Chairman of the Audit Committee

Professional and educational backgroundDavid Arnott is Chief Executive Officer of Temenos Group AG. Having served as Chief Financial Officer at Temenos from 2001 to 2012, he became CEO in July 2012. Prior to joining Temenos, he worked as Chief Financial Officer of Société Européenne de Communication in Luxembourg from 1999 to 2001. Mr Arnott also held a number of senior finance positions with the Anglo American group, a mining and precious metals trading company from 1995 to 1999. Prior to this, Mr Arnott was a Management Consultant with Deloitte from 1992 to 1995 where he also qualified as a Chartered Accountant.

Mr Arnott holds a Bachelor of Sciences from the University of Southampton and a Master’s Degree from the University of Freiburg.




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Richard SchlauriFunction Board member Born/nationality 1959, Swiss citizenFirst elected - 2012End of term - 2013 Committees - Member of the Compensation and Nominating Committee, Member of the Audit Committee

Professional and educational backgroundRichard Schlauri has been serving as Vice President WW Outsourcing Services at Wincor Nixdorf International GmbH since February 2011. Prior to joining Wincor Nixdorf, he held various senior management positions within the Siemens Group from 2004 to 2011 (Executive VP Services Delivery & Support, Member of the Senior Executive Team at Siemens Enterprise Communications; Executive VP Infrastructure Services, Member of the Executive Council at Fujitsu-Siemens Computer Corp; Senior VP and MD, Member of the Executive Council at FSC IT Product Services GmbH; VP and GM Infrastructure Services, Member of the Germany Management Team at Siemens Business Services). Prior to this, Mr Schlauri was working for Dell Computer Corporation in sales and general management positions from 1998 to 2004 and held management positions with Unisys GmbH, Olivetti GmbH and Apple Computer GmbH from 1991 to 1998.

Mr Schlauri holds a Bachelor of Sciences from FH Zurich.


Changes in the Board of DirectorsAt the Extraordinary General Meeting of Shareholders on 23 February, 2012, Erik Hansen was elected as a member of the Board of Directors until the Annual General Meeting in 2013. At the Annual General Meeting on 29 May, 2012, David Arnott and Richard Schlauri were elected as members of the Board of Directors and Erik Hansen was elected as Chairman until the Annual General Meeting in 2013.

Simon Wilkinson was re-elected as a member of the Board of Directors at the Annual General Meeting in May 2012, but resigned from the Board in October 2012 in order to pursue other business interests. Loek Van Den Boog did not stand for re-election at the AGM in May 2012.

Elections and terms of officeAccording to the Company’s Articles of Incorporation, dated 26 September, 2012, the Board of Directors is composed of at least three members who shall be elected by the General Meeting of Shareholders for a term of office of one year. The time period from one Annual General Meeting to the following shall be deemed to be one year. Board members are eligible for re-election. There are no limits on the terms of office. The Articles of Incorporation do not contain further rules about the election procedure (global or individual election). At the Extraordinary General Meeting in February

2012, Erik Hansen was elected in an individual election procedure. At the Annual General Meeting in May 2012, the new Board members David Arnott and Richard Schlauri were elected and Simon Wilkinson was re-elected in individual election procedures.

Internal organisational structureAllocation of tasks within the Board of DirectorsBased on the Company’s Articles of Incorporation and Organisational Regulations, the Board of Directors sets up its own organisation at its first meeting after the General Meeting of Shareholders. It appoints a Chairman and one or more Vice Chairmen as well as a secretary who does not have to be a member of the Board. The Board of Directors and the Committees meet at regular intervals during the year, at least four times a year, on dates agreed upon before the start of the business year, and additionally as often as the Company’s affairs require. In financial years 2011 and 2012, the Board of Directors usually held meetings or telephone conferences on a monthly basis.

The Organisational Regulations stipulate that if for reasons specific to the Company or due to circumstances relating to the availability of the Chairman of the Board of Directors or of the CEO, it should become necessary that a single individual should assume the joint responsibility of Chairman of the Board and CEO, the Board of Directors can decide that both functions shall be assumed by one and the same person and the Chairman of the Board shall be the Chief Executive Officer (CEO). In this case, the Board of Directors shall appoint an experienced non-executive member of the Board to act as Lead Director. The responsibility of the Lead Director shall be to ensure the ongoing supervision and control of the CEO, the Management by the Board of Directors and to generally assist the Board in performing its functions and exercising its duties and obligations.

The Lead Director shall, therefore, be entitled to convene on his/her own and chair meetings of the Board of Directors when necessary. He/she shall, at any time, be entitled to request reports from the CEO and other members of the Management. Since the Company follows a policy of clear separation between the functions of the Chairman of the Board of Directors and of the Chief Executive Officer, no Lead Directors have been appointed thus far.

Erik Hansen has been acting as Chairman of the Board of Directors since May 2012. He has also been Chairman of the Compensation and Nominating Committee and a Member of the Audit Committee since then. David Arnott has been acting as Vice Chairman of the Board of Directors and Chairman of the Audit Committee since May 2012. Richard Schlauri has been a Member of the Board of Directors and a Member of the Compensation and Nominating Committee, as well as a Member of the Audit Committee since May 2012. For Board composition and individual tasks within the Board of Directors prior to the election of the current Board members please refer to page 18 of the Annual Report 2011 on the Company’s website http://www.myriadgroup.com/investors/financial-publications.aspx.


Committees of the Board of DirectorsThe Board of Directors has two committees: an Audit Committee as well as a Compensation and Nominating Committee.

The Audit Committee (AC) shall be composed of at least two non-executive members of the Board of Directors who are appointed by the Board of Directors for a term of one year. Re-election is possible. The Board of Directors may remove and replace individual members at any time. All members of the AC must be determined by the Board of Directors as being fully independent and financially literate, and at least one member must have accounting or financial management expertise. No member of the AC shall serve on the audit committee of more than two other public companies. AC members shall not receive any consulting, advisory or other compensation fees from the Company other than for AC, Board or other Board Committee mandates. The AC holds meetings at least once a year prior to the Annual General Meeting of Shareholders. In addition, the AC shall meet whenever a meeting is requested by one of its members or as it may deem necessary.

The AC supports the Board of Directors in exercising its responsibilities in connection with the supervision over the internal control system for financial reporting, in particular with respect to matters requiring the exercise of judgments and estimates. The AC reviews the financial statements of the Company and discusses with the Company’s external auditors the results of their audit of the Company’s annual accounts. It also issues recommendations to the Board of Directors regarding the approval of the Company’s annual financial statements and budget. The entire list of all duties of the AC is available in the Organisational Regulations of the Company (page 12) on http://www.myriadgroup.com/investors/corporate-information.aspx. The AC generally acts in a preparatory capacity, with decisions taken by the entire Board of Directors.

The Compensation and Nominating Committee (CNC) shall be composed of at least two non-executive members of the Board of Directors who are appointed by the Board of Directors for a term of one year. Re-election is possible. The Board of Directors may remove and replace individual members at any time. All members of the CNC shall be independent of Management and free from any business or other relationship which could interfere with the exercise of their independent judgment. The CNC holds meetings as often as the business and affairs of the Company require and whenever it is requested by one of its members, but at least twice a year.

The CNC reviews and recommends to the Board of Directors the remuneration for Board members. It approves the employment agreements and compensation of the CEO and the members of the Management, including termination agreements. The CNC recommends to the Board of Directors the compensation structure and policy, as well as benefit and pension plans for employees of the Company. It approves all bonus, employee share option and other incentive plans of the Company. It further supports the Board in evaluating

Management and Board performance. It also proposes new Board member candidates to the Board of Directors, to be recommended for election by the General Meeting of Shareholders. The entire list of all duties of the CNC is available in the Organisational Regulations of the Company (pages 8 to 10). For the duties listed in the Organisational Regulations, ‘approval’ shall indicate that the CNC has the power to take decisions, whereas ‘recommendation’ indicates that the power to take decisions is subject to the approval of the entire Board of Directors.

Work methods of the Board of Directors and its CommitteesIn financial year 2012, the Board of Directors and the Committees met as follows:• Board of Directors: 7 meetings, 6 telephone conferences,

5 circular resolutions• Audit Committee: 1 meeting, 1 telephone conference,

0 circular resolutions• Compensation and Nominating Committee: 1 meeting,

2 telephone conferences, 0 circular resolutions

The average duration for the meetings has typically been between five and six hours for Board meetings, two hours for Audit Committee and two hours for Compensation and Nominating Committee meetings. The Chief Executive Officer and the Chief Financial Officer generally attend Board meetings and, if their presence is needed, also Committee meetings. The CEO attends the Compensation and Nominating Committee meetings as appropriate, and the CFO generally attends the Audit Committee meetings. There is no regular calling by the Board of Directors or its Committees upon external consultants to deal with specific issues.

In financial year 2012, the following meetings were attended by members of Senior Management:• CEO: 12 Board meetings/telephone conferences, 2 AC

meetings/telephone conferences, 1 CNC meeting (attendance includes former CEO and current CEO respectively)

• CFO: 13 Board meetings/telephone conferences, 2 AC meetings/telephone conferences, 0 CNC meetings

Areas of responsibility of the Board of Directors and Senior ManagementTo the extent permissible by law and the Company’s Articles of Incorporation, and unless provided otherwise in the Organisational Regulations, the Board of Directors has delegated the management of the Company to the Committees and Senior Management.

In addition to the non-transferable and non-alienable legal duties, the Company’s Board of Directors has reserved decisions on the following issues for approval by the Board of Directors:• Change of the Company’s accounting principles (currently

IFRS)• Change of the Company’s business activities• Issue of the Company’s internal policies (particularly

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• Issue of Corporate Governance principles and regulations• Issue of risk control standards, limits and risk principles• Appointment and removal of members of Management• Approval of the budget and strategy plan for each

business year• Purchase of assets whose value exceeds USD 500,000

and whose purchase is not provided for in the budget• Sale or agreements concerning the encumbrance of

assets by mortgage, pledge or similar restrictions in excess of USD 500,000

• Issue of any guarantee, surety or undertaking to pay in the name of the Company in excess of USD 500,000

• Purchase and sale of participations in other companies, if not provided for in the budget and in excess of USD 500,000 in the aggregate

• Formation of subsidiary companies and branch offices in Switzerland or abroad

• Purchase or sale of real estate or parts thereof• Any investment made, or liability or debt incurred, by the

Company, which is not provided for in the budget and is individually in excess of USD 500,000

• Approval of option grants

The Senior Management has the following principal tasks:• Execution of the strategy set by the Board of Directors• Responsibility for the day-to-day management and

on-going operations of the Company• Overall responsibility for the development and

implementation of the Company’s vision, long-term strategies and key partnerships as well as the proposal for key acquisitions, mergers and investments

• Preparation of proposals which have to be submitted to the Board of Directors for approval

• Regular information to the Board of Directors about the Company’s business development

• Responsibility for implementing the risk management and control principles as defined by the Board of Directors

Information and control instruments vis-à-vis Senior ManagementThe Board of Directors ensures that it receives sufficient information from Senior Management to perform its supervisory duties:

Monthly Board Reports – All Board members receive an extensive written report on a monthly basis. This report reflects issues of the previous month and includes the following details:• Finance Report: Key figures for the month and on a

year-to-date basis, as well as comparisons against budget for the Group and the Divisions (e.g. Revenue, Adjusted gross profit, OPEX, EBITDA, etc.), Quarterly review against budget when appropriate, Balance sheet items (e.g. Cash, Working Capital, Cash outlook, Receivables, etc.), Cash Flow, Number of employees, Budget update looking forward, etc.

• Commercial Report: Targets and achievements on commercial aspects of the business for the Group and the Divisions, information on developments in the addressed business and markets, bookings information, press relations updates, etc.

• Products / Operations Report: Update and forecasts on product releases, planned events, progress in key projects, etc.

• Update on potential M&A activities

Board members will also approve the information issued in the framework of the Annual Report and Half-Year Report.

Usually, the Board of Directors will meet at regular intervals and hold at least six to ten meetings per year, with additional informal meetings or teleconferences to be held as required between the Directors and the Chairman.

The Chief Executive Officer and Chief Financial Officer participate at the meetings of the Board of Directors and report on the individual items mentioned above (for details of the attendance see Work methods of the Board of Directors and the Committees above). Other members of the Senior Management have attended one Board or one Board Sub Committee meeting. Apart from the meetings, the CEO reports immediately any extraordinary event and/or change within the Company or the Group to the Chairman as appropriate. The CFO generally attends all meetings of the Audit Committee.

At Board meetings, all members of the Board of Directors may request information as to the general course of business as well as to particular business matters. Outside meetings, each Board member may request information as to the general course of business and, with the approval of the Chairman, as to particular business matters.

The members of the Board of Directors may request information from the Board of Directors as a whole, the Compensation and Nominating Committee, the Audit Committee, any other committee appointed by the Board (if such exist), individual Board members, members of the Management, and all employees of the Company who independently carry out management duties.

To the extent necessary to fulfil its duties, each Board member may request from the Chairman, at or outside meetings, that books and records be disclosed to it. In the event that the Chairman rejects a request for information or inspection for reason of business secrecy, the Board of Directors shall decide.

The corporate risk management function is appointed to the Chief Financial Officer. The risk management matrix is reviewed and approved by the Board of Directors once per year. The organisational internal control system (ICS) is integrated into the operating procedures accompanying business process activity, being performed before or after an activity. Internal controls are integrated components of business processes; they are not summarised in a separate ICS function. The ICS is operated on all levels within the


Myriad Group and requires a high measure of individual responsibility of all employees. The ICS procedure:• Focuses on key risks and key controls• Ensures processes, risks and controls are documented

appropriately• Maintains adequate and traceable documents • Reports to the Audit Committee at least once a year

In financial year 2012, the CFO reported specifically on ICS issues in one meeting of the Audit Committee.

The ICS is applied to processes material to the financial statements. These include:• Order to cash• Procure to pay• Payroll• Financial closing procedure• Intangible assets• Consolidation• Information Technology

The control matrices and process documentation for each process within the scope of the Group’s ICS are assessed at least annually. Controls assessments regarding the design and operating effectiveness are performed annually. Although the controls are listed and assessed individually regarding their effectiveness, a conclusion is taken by risk area. If necessary, measures for optimising the controls are implemented.

Myriad does not employ a specific internal audit function, but utilises regular reviews by Group and Subsidiary Finance staff to ensure compliance with internal control systems. In addition the External Auditor presents to the Audit Committee an overview of issues found during the audit of the annual financial statements, and the review of the half-year financial statements, as well as a review of the internal control system. The External Auditors were present at all Audit Committee meetings/telephone conferences in 2012.

The Board of Directors monitors the work and audit results of the External Auditors through the Audit Committee. The Audit Committee reviews the selection of auditors annually as well as the level of the external audit fees. In its review, the Audit Committee takes into account the External Auditor’s quality of service, the expenses compared to other auditing companies and the fees for non-audit related services.

4. Senior ManagementAs of 31 December, 2012, the Senior Management (Executive Team) of the Company consists of five members.

Stephen DunfordFunction Chief Executive OfficerBorn/nationality 1957, UK citizenFirst appointed – 2012

Professional and educational backgroundStephen Dunford joined Myriad as its Chief Executive Officer in December 2012. He has a long

track record of building value within telecommunications software and services businesses. Prior to joining Myriad, he was CEO of Spectrum Motion Media from 2009 to 2012. He previously held Chairman and CEO roles at X-cell Communications which he founded in 1990 and later sold to Nortel Networks (in 1999). From 2003 to 2005, Mr. Dunford was CEO of Elata, leaders in mobile content management, which he sold to Qualcomm. As CEO of Celltick Technologies (from 2006 to 2009), he transformed the business from a license based technology company into a mobile marketing managed service business. Mr Dunford also worked as a strategic advisor to WDS Global (from 2006 to December 2012), a mobile device management company, which was sold to Xerox Corporation in August 2012. He founded Alamein, a mobile field force application developer in 2000.

Mr Dunford holds a Bachelor of Arts Degree in Business Studies from Kingston University, London.

Other activities and vested interestsStephen Dunford serves on the Board of Directors of Pythagoras Communications, a leading CRM vendor.

James BodhaFunction Chief Financial OfficerBorn/nationality 1967, UK citizenFirst appointed – 2009

Professional and educational backgroundJames Bodha has served as Chief Financial Officer of Myriad since September 2009. He has over 14 years of senior financial

management experience, having managed business operations in a variety of publicly traded companies in the engineering, retail and technology sectors. Prior to joining Myriad, Mr Bodha was CFO at Aircom International, the market leader in mobile network planning and optimisation, from May 2006 to July 2009. Before Aircom, he was CFO of the Global Mobile Handset Software Division of Openwave Systems, a NASDAQ-listed mobile software and services company based in San Francisco from August 2004 to April



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2006. His arrival at Openwave followed its acquisition of Magic4, the global market leader in mobile messaging, where Mr Bodha had been CFO from September 2003 to August 2004. Prior to joining Magic4, Mr Bodha was the Finance & Commercial Director at Anite Public Sector Ltd from January 2001 to June 2003, the Trading Finance Director for the UK Retail Division at Airtours Ltd from November 1999 to January 2001, and a Divisional Finance Director at Asda plc from May 1997 to November 1999.

Mr Bodha has a Bachelor of Science degree (Hons) in Chemistry from Manchester University and is a qualified Chartered Accountant and member of the Institute of Chartered Accountants for England and Wales (ICAEW).


Mike GrantFunction Chief Marketing OfficerBorn/nationality 1962, UK citizenFirst appointed – 2012

Professional and educational backgroundMike Grant was appointed as Chief Marketing Officer in September 2012 after holding

the interim post of Vice President of Product Marketing since April 2012. Prior to joining Myriad, Dr Grant was founder and CEO of Caru Ventures where he advised mobile technology companies and financial institutions on corporate strategy and financial transactions. From 2011 to 2012 he was Chairman of Evinidus Ltd, a start-up company offering single read, shareable ebooks through its own patented technology. From 2007 to 2010, he served as Chief Marketing Officer and Media Partner at Analysys Mason Ltd, a global strategy consulting firm in the telecoms and media sectors. In 2001, Dr Grant was appointed Vice President Marketing and Strategy at Superscape plc, where he led a major transition of the business from a product to a services business, creating a global standard for delivering 3D graphics in mobile phones, and building a major global mobile games business. Prior to Superscape, he was a Partner at global telecoms strategy consultants Analysys Ltd where he established the company’s mobile communications practice advising operators, financial institutions and governments on business growth and market liberalisation strategies.

Dr Grant has a Bachelor of Science degree (Hons) in Electronics and Electrical Engineering from Glasgow University, a PhD in Coherent Fibre Optic Communications, and a Masters in Business Administration from Cranfield School of Management (UK). He is also a Chartered Engineer and a member of the Institute of Engineering and Technology.

Other activities and vested interestsDr Grant remains a Director of Caru Ventures Ltd.

Other activities and vested interestsApart from Stephen Dunford and Ed Zylka as further detailed in the table above, the Senior Management members neither pursue activities in governing and supervisory bodies of important Swiss and foreign organisations, institutions or foundations under private and public law, nor do they pursue permanent management or consultancy functions for important Swiss and foreign interest groups. None of them have official functions or political posts.

Personnel Changes in the Senior ManagementDuring the financial year 2012, the following former members of Senior Management resigned: Gordon Tsang, Gary Bunney in December 2012, Simon Wilkinson, Mike Brady, James Robins in September 2012. Liz Hitchen was a member of the Senior Management team at 31 December 2012 but resigned from her position as VP HR in February 2013. For details of her CV please refer to Annual Report 2011 page 24. The members of Senior Management appointed in 2012 were: Stephen Dunford and Ed Zylka in December 2012, Mike Grant in September 2012, Kim Hartlev in April 2012.

Management contractsThere exist no management contracts delegating management duties to third parties.

Kim HartlevFunction Chief Technical OfficerBorn/nationality 1976, Danish citizenFirst appointed – 2012

Professional and educational backgroundKim Hartlev has more than 12 years’ experience in developing value added services for mobile

operators and device manufactures. Mr Hartlev joined Myriad as Chief Technical Officer in April 2012 and is currently responsible for Research and Development as well as Hosting and Support in the Mobile Services Division. Prior to joining the Executive Team at Myriad, he was Chief Technical Officer of Synchronica plc (which was acquired by Myriad in 2012), where he was responsible for Synchronica’s technical vision and product innovation. He lead Synchronica’s global product management and development teams, while also overseeing Synchronica’s hosting and IT functions from 2006 to 2012. Preceding Synchronica, Mr. Hartlev held several roles with Mobilethink, the Danish specialist in device management including Chief Technical Officer, during the period from 2000 to 2006.

Mr Hartlev holds a BSc in Electronic Engineering and Computer Science from Aarhus University School of Engineering, Denmark.



Ed ZylkaFunction SVP & General Manager Device Solutions DivisionBorn/nationality 1959, US citizenFirst appointed – 2012

Professional and educational backgroundEd Zylka was appointed as Senior

Vice President and General Manager of the Device Solutions Division in December 2012. Since January 2011, he had held the post of Vice President & General Manager Americas for Myriad. Ed Zylka is an executive with over 25 years of senior management experience in sales, marketing and operations in various technology companies ranging from start-ups to Fortune 500 companies. Prior to joining Myriad, he was founder and CEO of TV Compass Inc from 2005 to 2009, a connected home start-up company which he sold to Logitech. Between 1994 and 2000 he was Senior Director of Product Management at General Instrument a leader in cable TV products where he created the market leading SURFboard(TM) cable modem product line with over 100 million units shipped globally. As a corporate development executive at General Instrument he assisted on the $18B sale to Motorola and later held senior management posts at Motorola Mobility between 2000 and 2005. During his tenure with Motorola Mobility, he directed the mobile software strategy and development for mass market handsets, delivering advanced contacts, calendar and email apps shipped to over 300 million phones globally.

In addition as GM 4th pass Inc. a Motorola subsidiary he led the managed service expansion for Java content delivery to over 300M mobile handsets-passed serving global customers that included China Mobile, China Unicom, T-Mobile, Sprint/Nextel, Telefonica and O2.

Mr Zylka has a Bachelor of Science degree (Hons) in Electrical Engineering from the State University of New York, Buffalo.

Other activities and vested interestsStrategic advisor to Personify Inc.(Chicago, IL) a venture backed start-up revolutionising video collaboration using advanced tele-presence technology.

Board member Classroom Champions, a global non-profit organization which utilises remote learning technology and Olympic athletes to mentor students in underserved communities.

5. Compensation, shareholdings and loans

Content and method of determining the compensation and the share ownership programmesCompensation to the non-executive members of the Board of DirectorsThe compensation for each non-executive member of the Board of Directors is proposed by the Compensation and Nominating Committee once per year and decided upon by the entire Board of Directors entirely at its own discretion.

The compensation takes into account the responsibilities of each member (Chairman of the Board of Directors, Committee Chairman or Committee member). The compensation is not tied to particular company targets. The fee for the mandate as a member of the Board of Directors and/or Committee is paid in cash as fixed compensation.

In order to align Board compensation with the Company’s strategy and long-term shareholders’ interest, the Board members may additionally receive long-term incentives in the form of stock options. If such options are granted, they usually have a vesting period of (i) 1/3 vesting 12 months after grant date and (ii) 1/36 on each of the following 24 months. On resignation from the Board any options that have vested have an exercise period of 6 months from date of leaving (12 months in the event of death or serious illness), and any unvested options lapse (except in the event of death or serious illness, where at the discretion of the Board they may vest immediately). The grant of options is decided upon by the entire Board of Directors once per year and entirely at its own discretion.

In the financial year 2012, the non-executive members of the Board of Directors received compensation in cash and Share Options.

For financial year 2012, the Board of Directors set the amounts of fix compensation as follows:

Board of Directors:

Chairman CHF 100,000 (2011 CHF 110,000)

Member CHF 40,000 (2011 CHF 30,000)

Audit Committee (in addition to compensation as a Member of the Board):

Head of AC CHF 20,000 (2011 CHF 20,000)



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Compensation and Nomination Committee (in addition to compensation as a Member of the Board):

Head of CNC CHF 10,000 (2011 CHF 10,000)

The number of options granted was set as follows:

Chairman 33,333 (2011 Nil)

Member Nil (2011 Nil)

The fair value of the granted options for the Board members was between 0% and 50% compared to their fixed compensation in 2012 (2011: 0%).

In addition to compensation as a non-executive Director, Erik Hansen has an additional contract with Myriad to recruit additional members of the Myriad Board to the Company. He received a single fee of CHF 10,000 for expenses incurred in connection with the provision of this service, plus an additional CHF 25,000 for each person that he recruited to join the Myriad Board. This agreement is for an unlimited time and can be terminated on seven days’ written notice being given by either party. Mr Hansen recruited one member to the Board of Directors, who was elected at the General Meeting of Shareholders in May 2012. For a period between the resignation of Simon Wilkinson in September 2012 and the appointment of Stephen Dunford as CEO in December 2012, Mr Hansen temporarily increased his time commitment for a one time fee of CHF 78,500.

Compensation for the members of Senior ManagementThe Compensation and Nominating Committee (‘CNC’) reviews and approves the remuneration of the members of Senior Management. The compensation of Senior Management consists of a basic salary (in cash) that reflects their individual business responsibilities and is defined at the end of the previous year (or in the employment contract in case of new members of Senior Management joining the Company during the year) and is adjusted during the reporting period only by exception. The compensation also contains a performance-related bonus that is determined once a year by the CNC, and inclusion in the Group Stock Options Scheme as a long-term incentive.

In the financial year 2012 (and 2011), Senior Management received their variable pay bonus through a grant of share options with an exercise price at the nominal value of Myriad Group shares.

The number of options actually vesting is based on achievement of both Group and personal objectives, including measures on Revenue and EBITDA results and individual Key Performance Indicators (KPIs) specific to the area for which each individual is responsible.

In 2012, the range of weightings of these components across the Senior Management Team was:

(i) 40%-80% of total bonus represented by the notional value of options granted at the grant date (2011: 40%-80%) dependent on the achievement of Revenue and EBITDA targets

(ii) 20%-60% of total bonus represented by the notional value of options granted at the grant date (2011: 20%-60%) dependent on the achievement of personal KPI’s

The options granted to each Senior Manager is the equivalent value of between 30% and 100% of the base salary. Bonus payments have no minimum limit, but for 2012 the options are granted to a maximum of 100% of the options allocated to each individual (2011: maximum of 100%). Any achievement above 100% of target is remunerated in cash.

Examples of the KPI’s used for individual members of the Senior Management team include product delivery, development and delivery of products and market strategies, bookings targets, restructuring and cost saving metrics.

In determining and approving the compensation for the Senior Management, the Compensation and Nominating Committee uses the industrial background (technology, software, telecommunications sector) and professional experience of its members and decides entirely at its own discretion. No external advisors were consulted in respect of structuring the compensation for the Senior Management team.

The split between the basic salary and variable pay depends on the particular management position. There are no other allowances. However, the compensation also contains local taxes relevant to social insurance.

For the financial year 2012, the variable pay component of the basic salary was an options allocation of the equivalent fiscal value of 100% for the former CEO (2011: 100%). The options vested in 2012 were the fiscal equivalent of 6% of basic salary, based on the calculated fair value (2011: 42% of basic salary).

The on target variable pay component for other members of Senior Management was an option allocation of the equivalent fiscal value of between 30% and 50% (2011: between 30% and 50%) of the basic salary. The options vested in 2012 represented the fiscal equivalent of between 0% and 20% (2011: between 2% and 48% of basic salary).

The options for the variable pay component vest according to achievement of both business and key personal targets, which are related to achievement of growth, profitability and product achievement targets. The variable pay options vest in accordance with achievement of these targets, and if these targets are not achieved the options are lost.

In addition, the Board of Directors, upon recommendation of the Compensation and Nominating Committee, approves the grant of stock options to the Senior Management for the purpose of retaining key contributors. Stock options granted during financial year 2012 vest as follows:


(i) For eligible persons being granted with stock options for the first time (for example as sign-on grants), 1/3 of the options vest 12 months after the grant date and 1/36 vests on each of the 24 consecutive months. During 2012 30,000 of this type were granted to a member of the Senior Management Team (2011: no options of this type were granted to members of the Senior Management Team).

(ii) In addition to grants relating to variable pay, in 2011 821,000 options were granted to 7 members of the Senior Management team as ‘Retention Options’. These vest dependent on the actual share prices achieved for at least 10 days in any 30 day period, the first half in a period between March 2012 and February 2015 and the second half in a period between March 2013 and February 2016. The percentage of options that vest ranges between 25% vesting at a share price above CHF 3.00 up to 100% vesting at a share price above CHF 5.00 for the first half, and a share price above CHF 6.00 for the second half. Any options that do not vest lapse at the end of the vesting period. No ‘Retention Options’ were issued in 2012.

The members of the Senior Management do not attend meetings of the Compensation and Nominating Committee at which their compensation is being discussed and approved. The CEO attends the meetings of the CNC when the compensation of the Senior Management team is being discussed, but does not attend when his own compensation is being discussed and approved. The CNC informs the Board of any decisions taken after each committee meeting.

The employment contracts with the current members of Senior Management do not contain any specific termination pay. Notice periods range between 3 and 6 months. Any outstanding share options not vested at the end of employment lapse; vested options have six months post the end of the employment date to exercise before lapsing (twelve months in the event of death).

No termination payments were made during the financial year 2012 (none in 2011). Further details of the settlement agreements, and details of remuneration and indirect benefits of key management are shown in Note 11 ‘Employee compensation and benefits’ in the notes to the consolidated financial statements.

Compensation, shareholdings and loansDetails to the compensation, shareholdings and loans to acting and former members of the Board of Directors and of the Senior Management are reported in detail within the Statutory Financial Statements of this Annual Report on pages 67 to 69.

6. Shareholders’ participationVoting rights and representation restrictionsThe Company’s Articles of Incorporation do not contain any restrictions on voting rights and representations.

Statutory quorumsThe Company’s Articles of Incorporation do not contain rules divergent from Swiss law.

Convocation of the General Meeting of ShareholdersThe Company’s Articles of Incorporation provide for the convocation of the General Meeting of Shareholders via publication in the Swiss Official Gazette of Commerce no later than 20 days before the meeting. In addition, the invitation is sent by mail to the shareholders registered in the Company’s share register.

AgendaShareholders who together hold shares with a nominal value of at least CHF 1 million may request that an item be put on the agenda of the General Meeting of Shareholders. Such request shall be made in writing, at the latest 45 days prior to the meeting, by indicating the proposals of the petitioning shareholders.

Inscriptions into the share registerBased on a resolution of the Company’s Board of Directors, the cut-off date for the closing of the share register before a General Meeting of Shareholders is set by the Board of Directors on an individual basis, whereas the date shall be as close as possible to the scheduled meeting date. For the General Meeting of Shareholders to be held on 29 April, 2013, the closing date for the share register has been set for the period commencing on 15 April, 2013 and ending on 30 April, 2013.

7. Changes of control and defence measuresDuty to make an offerThe Company’s Articles of Incorporation do not contain any opting-out or opting-up provisions, meaning that a shareholder is required to make a full tender offer if the legally prescribed threshold of 33 % of the voting rights of the Company is reached (see Art. 32 of the Federal Act on Stock Exchanges and Securities Trading).

Clauses on changes of controlThe employment contracts of the Senior Management members, the members of the Board of Directors or other employees who hold key positions at Myriad do not provide for any change of control clauses and the notice periods remain unaffected by a change of control event.

8. AuditorsDuration of the mandate and term of office of the lead auditorPricewaterhouseCoopers AG, Zurich (‘PWC’) has been acting as auditors of the Company since the financial year 2010. The shareholders re-elected PWC as the Company’s independent public accountants for another term of one year at the Annual General Meeting held on 29 May, 2012. Martin Kennard has been the lead auditor since 2010.



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Auditing feesFor the financial year 2012, PWC charged the Company auditing and audit-related fees amounting to CHF 460,000 (USD 490,000).

Additional feesPWC charged the Group the following additional fees during the financial year 2012 for services in relation to the following:

Tax advisory services CHF 91,724 (USD 98,241)

Services relating to acquisition CHF 148,650 (USD159,000)

Information tools pertaining to the external auditThe Audit Committee is, on behalf of the Board of Directors, responsible for supervising the activities performed by the external auditors. It reviews the engagement letter of the auditors, the fees and the terms of the planned audit work once per year. The results of the annual audit of the annual accounts are discussed in detail with the external auditors. The auditors usually perform a detailed audit report on the financial year results and a financial review on the half-year results.

In financial year 2012, PWC performed a detailed audit report on the FY 2011 report, whose findings and conclusions were discussed with the Audit Committee. PWC had one meeting and one telephone conference with the Audit Committee during the financial year 2012. Any non-audit services or additional audit work to be performed by the auditors have to be pre-approved by the Audit Committee for final approval by the Board.

The Audit Committee assesses the qualification, independence and performance of the external auditors as well as the co-ordination and interaction between the Company and the auditors. The Audit Committee thereby considers various criteria, including operational understanding of the Company’s business (especially the mobile phone/mobile internet markets), sufficient resources set aside by the auditors, independence, global network of the auditors, understanding of the risks of a technology company and the particular business risks of Myriad Group, practical recommendations and support, co-operation with the Audit Committee and with Senior Management. The Audit Committee and Senior Management closely monitor the proportion between the auditing fee for the annual financial statements and the additional non-audit services performed by the auditors. The Audit Committee examines potential consequences regarding the independence of the auditors. During the financial year 2012, the Board of Directors concluded that the independence of the auditors was fully ensured at all times.

The Audit Committee also evaluates the effectiveness of the auditors in accordance with Swiss law and with regard to the audit of the Company’s consolidated financial statements that are prepared in compliance with International Financial Reporting Standards (IFRS). It then makes a recommendation

to the entire Board of Directors with regards to the preferred audit firm. Upon this recommendation, the Board of Directors itself verifies once per year the selection of the potential auditors, in order to propose its preferred audit firm for election to the shareholders at the General Meeting of Shareholders.

The Board of Directors follows the regulations of the Swiss Code of Obligations with regards to the rotation intervals of the lead auditor, i.e. the lead auditor has to be rotated every seven years.

9. Information policyFor the benefit of its shareholders and the public interest, the Company pursues an open and transparent information policy. Myriad Group AG publishes its financial reports in an annual report and on a half-year basis. The annual and half-year reports are available on the Company website in electronic form. The annual report can also be obtained free of charge from the Company in print form. The financial reports are available at:

http://www.myriadgroup.com/investors/financial-publications.aspx.

When the annual results are released, Myriad Group organises a physical conference for the media and the financial community to discuss details of the reported earnings. For the half-year results, the Company organises either a physical conference or a conference call. The presentations that are used at analysts/media conferences or during conference calls are also available under the same web link as the financial reports (see link above).

Official notices are published in the Swiss Official Gazette of Commerce (Schweizerisches Handelsamtsblatt).

The Company website www.myriadgroup.com contains extensive information on the business activities, Company structure, financial reports, media releases, investor relations, etc.

Web links regarding the SIX Swiss Exchange push-/pull-regulations concerning ad hoc publicity issues are

http://www.myriadgroup.com/investors/investor-contact.aspx,

http://www.myriadgroup.com/investors/email-alerts.aspx (subscribe to Email alerts) and http://www.myriadgroup.com/press.aspx.

The current Articles of Incorporation and the Organisational Regulations are available at

http://www.myriadgroup.com/investors/corporate-information.aspx.

For investor relations contacts and a summary of anticipated key dates in 2013 please refer to page 82 of this Annual Report.


Financial overview

USD‘000FY 2012

IFRSFY 2011

IFRS

Revenue 56,288 61,021

Adjusted gross profit1 28,277 42,886

Gross margin in % 50.2% 70.3%

EBITDA before non-recurring items and restructuring costs (6,057) 8,913

EBITDA margin in % (10.8%) 14.6%

EBITDA2 (11,107) 4,067

EBIT without non-recurring items, impairment and restructuring costs (25,969) (8,735)

EBIT (60,527) (15,064)

Net result (58,512) (15,880)

Operating cash flow (29,508) (3,988)

Cash and cash equivalents 5,864 25,926

Shareholders’ equity 33,997 47,822

Equity ratio in % 31.9% 48.1%

Total headcount at year end (FTE) 509 477

Market capitalisation (CHF ‘000) 146,721 186,734

1. Gross profit before amortisation, impairment and restructuring costs.2. Including restructuring charges excluding non-recurring items.

Executive financial summaryGroup revenue of USD 56.3 million, was down USD 4.7 million compared to last year after inclusion of USD 15.9 million post acquisition Synchronica revenues.

Gross margin fell by 20.1% to 50.2% reflecting a lower mix of higher margin licence and legacy device revenues offset by lower margin Synchronica revenues.

Net losses were significantly higher at USD 58.5 million (USD 15.9 million in FY2011) reflecting underlying operating losses, impairments and non-recurring charges for restructuring and Synchronica acquisition deal fees offset by income from a sale of non-core patents.

During the year Myriad received USD 10.8 million from the issue of share capital to finance integration and restructuring following the acquisition of Synchronica. This together with an USD 8.0 million additional financial guarantee secured in early 2013 should ensure Myriad has adequate funding to execute its growth strategy.

RevenuesYear on year, there was a significant change in divisional revenue mix with the Mobile Service Division (MSD), boosted by the contribution from the Synchronica acquisition accounting for USD 29.9 million (53.2%) of Group revenues (USD 11.3 million, 18.6% in FY2011). The change in mix is consistent with the strategy to develop a growing social messaging business to offset the decline in legacy Device Solutions Division (DSD) business.

Licence revenue of USD 26.2 million accounted for 46.5% of Group revenues (USD 33.6 million, 55.1% in FY 2011), including a contribution from Synchronica of USD 8.6 million. The reduction in licencing revenue reflects the decline in legacy DSD.

Service revenues of USD 30.1 million (USD 27.4 million in FY 2011), including a post-acquisition contribution from Synchronica of USD 7.3 million increased to 53.5% of total revenues (USD 44.9% in FY 2011). Service revenue gains from additional Nokia business acquired through Synchronica were largely offset by lower DSD revenues.

DSD revenues of USD 26.3 million (USD 49.7 million in FY 2011) were impacted by the continuing trend of reduced feature phone volumes as device manufactures move away from these products towards free Android based software. Whilst the legacy business contracted, new customers and contracts were secured in the growing ‘Connected Home’ market, most notably with Comcast, Jolla and JCom, which are expected to deliver more material revenues in 2013.

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Although the MSD revenues increased to USD 29.9 million (USD 11.3 million in FY2011), underlying growth in social messaging revenue (excluding Synchronica acquired business) was disappointing reflecting delays in deployment and increased complexity in the product rationalisation process. Significant progress was made to resolve these issues in the second half of the year, however improvements were too late to materially impact 2012 revenues. With the benefit of live deployments with American Moviles, Telefonica in Latin America, Orange across North Africa and Vodafone in India, together with the product consolidation, management expect higher active subscriber numbers to drive more material revenues in 2013.

Cost of revenues and gross marginsGross margin declined 20.1% to 50.2% (70.3% in FY 2011) due to the inclusion of hosting and data centre support costs associated with the Synchronica acquisition and the decline in historically high margin legacy DSD licence and services revenues. Currently there is significant excess capacity in the hosting capability relative to the levels of subscribers supported. However management expect hosting efficiency will improve as new subscribers and incremental revenue will be added with minimal impact to hosting costs.

Research and developmentResearch and Development (R&D) gross expenses before restructuring costs amounted to USD 19.3 million or 34.4% of total revenues (USD 18.1 million and 29.7% of revenue in FY 2011). The increase in R&D expenses primarily reflects incremental costs associated with the acquisition of Synchronica which comprised investment in the Unity messaging platform as well as the migration and consolidation of legacy messaging platforms as part of the Synchronica integration. Management expect absolute R&D spend as well as R&D as a percentage of revenue to reduce going forward as one time consolidation work is completed.

R&D capitalisation increased marginally to USD 5.9 million in 2012 (USD 4.6 million in FY 2011), or 30.5% (25.5% in FY 2011) of gross R&D expenditure.

Sales and marketingSales and Marketing expenses before restructuring and non-recurring costs declined by USD 1.5 million in 2012 to USD 9.5 million (USD 11.0 million in FY 2011) reflecting consolidation of sales roles across the Group. Sales and marketing expenses includes non-recurring costs of USD 7.0 million relating to the prudent write-down of capitalised exclusivity fees historically paid by the Group.

General and administrativeGeneral and administrative expenses (G&A) before restructuring costs, depreciation and bad debt expense was reduced by USD 2.4 million or 18.8% to USD 10.4 million (USD 12.8 million in FY 2011), reflecting the continuing steps taken by management to reduce the number of offices and rationalisation of support activities.

Restructuring expensesRestructuring expenses of USD 5.1 million (included within cost of revenue, sales and marketing and G&A expenses) were incurred in 2012 relating to the cost of programmes to reduce the cost base of the Group following the acquisition of Synchronica.

In FY 2011 the Group incurred USD 10.5 million French social plan costs which, whilst indemnified in the Sagem Wireless termination agreement, were not reimbursed before MobiWire (formerly Sagem Wireless) went into insolvency in 2011. In 2012 the Group accrued the final costs to conclude the French Social plan of USD 1.5 million, these are included within other expenses (see below).

Management estimate the annualised savings arising from this restructuring to be approximately USD 27.0 million per annum, of which USD 9.6 million was realised in 2012.

Other income and expensesOther income of USD 4.5 million (USD 15.0 million in FY 2011) largely comprised a profit on disposal of non-core patents within the Group’s intellectual property portfolio. The Group continues to seek opportunities to realise value on its remaining non-core intellectual property. The reduction in other income reflects the non-recurrence of the FY 2011 USD 12.0 million legal settlement with Openwave Systems Inc. R&D grant income of USD 0.1 million (USD 2.6 million in FY 2011) was significantly lower following the completion of related projects during 2011.

Other expenses of USD 5.5 million (USD 13.5 million in FY 2011) includes non-recurring Synchronica acquisition legal and professional fees of USD 3.1 million and French social plan costs of USD 1.5 million (USD 10.5 million in FY 2011).


EBITDAEBITDA (before non-recurring items and restructuring costs) amounted to a loss of USD 6.1 million (USD 8.9 million profit in FY 2011) being primarily driven by reduced legacy DSD revenues.

Impairment of intangible assetsFollowing the acquisition of Synchronica, Management took the decision to consolidate Myriad’s Xumii technology into the Unity platform secured through the Synchronica acquisition. The write-down of Xumii intangible assets resulted in a total non-cash impairment charge of USD 1.6 million, including USD 1.4 million capitalised R&D costs and USD 0.2 million intellectual property.

The decline in browser messaging revenues (purchased with the acquisition of Purple Labs) has resulted in non-cash impairment charges of USD 20.2 million, including USD 8.8 million goodwill, USD 9.4 million intellectual property and USD 2.0 million capitalised R&D costs.

Amortisation of intangible assetsThe amortisation of intangible assets amounted to USD 17.5 million (USD 16.4 million in FY 2011) and mainly reflects the amortisation of intellectual property related to the former Purple Labs business, capitalised development costs and intangible assets acquired with Synchronica.

Operating losses (EBIT)The EBIT before non-recurring items, impairment and restructuring charges amounted to a USD 26.0 million loss (USD 8.7 million loss in FY 2011). The non-recurring items during the fiscal year 2012 included proceeds from the sale of non-core patents, an accrual for French social plan costs, restructuring charges and costs incurred in the acquisition of Synchronica. More explanation regarding these items is provided in note 10 to the financial statements.

Finance income and expensesNet finance costs of USD 2.7 million (net finance income USD 0.5 million in FY 2011) includes USD 0.9 million foreign exchange losses (USD 0.8 million foreign exchange gains in FY 2011); interest on finance leases and other finance costs USD 0.3 million (USD 0.3 million in FY 2011); and a USD 1.5 million non-cash finance charge relating to the unwinding of the discount on the deferred consideration payable to Nokia in respect of the North America Network Operator business previously acquired by Synchronica in 2011.

Net lossAs a result of the above mentioned impairments, and one-time charges, the net loss for financial year 2012 amounted to USD 58.5 million (USD 15.9 million in FY 2011).

Cash flowNet cash used in operating activities during the year was USD 29.5 million (USD 4.0 million in FY 2011). The USD 25.5 million decline reflects operating losses, the cost of settlement of former Synchronica liabilities and the costs of restructuring.

Net cash used by investing activities in 2012 was USD 1.2 million (USD 6.4 million in FY 2011). The improvement year on year reflects USD 5.4 million proceeds from the sale of non-core patents and USD 0.7 million cash acquired with Synchronica. This is offset by capitalised development costs of USD 5.9 million (USD 4.6 million in FY 2011) and purchase of tangible and intangible assets of USD 1.3 million (USD 2.0 million in FY 2011).

Net cash flow related to financing activities was an inflow of USD 10.7 million (USD 2.8 million in FY 2011). This includes USD 10.8 million proceeds from a successful share placement in September 2012.

Liquidity and capital structureAs at 31 December, 2012, the balance of cash and cash equivalents was USD 5.9 million (USD 25.9 million in FY 2011). The net funds position (cash and cash equivalents less interest-bearing debt) amounted to USD 4.6 million at year end 2012 (USD 25.6 million in 2011) whilst shareholders’ equity decreased to USD 34.0 million (USD 47.8 in 2011) reflecting net losses during the 2012 financial year. An equity ratio of 31.9% was maintained as of 31 December, 2012 (48.1% in 2011).

Management discussion and analysisof results continued


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Year ended 31 December

USD’000, except for per share information Note 2012 2011

Licence revenue 26,168 33,636Service revenue 30,120 27,385

Total revenue 5 56,288 61,021

Cost of revenue 7 (46,004) (35,028)Impairment of intangible assets 16 (21,768) –

Total cost of revenue (67,772) (35,028)

Gross (loss) profit (11,484) 25,993

Research and development, net of capitalised costs (15,930) (15,025)Sales and marketing 8 (17,204) (11,705)General and administrative 9 (15,000) (15,882)Other income 10 4,544 15,038Other expenses 10 (5,453) (13,483)

Loss from operations (60,527) (15,064)

Finance income 12 14 763Finance costs 12 (2,732) (280)

Loss before income tax (63,245) (14,581)

Income tax credit (expense) 13 4,733 (1,299)

Loss for the year attributable to owners of the parent (58,512) (15,880)

Basic and diluted loss per share (USD) 14 (1.05) (0.33)

These consolidated financial statements should be read in conjunction with the accompanying notes.

The above results all relate to continuing activities.

Consolidated income statement



USD’000 Note 2012 2011

Loss for the yearOther comprehensive loss:

(58,512) (15,880)

Recycling of cumulative translation adjustment on liquidation of subsidiaries – 240Exchange differences on translating foreign operations (4,023) (1,693)

Other comprehensive loss for the year, net of tax (4,023) (1,453)

Total comprehensive loss for the year attributable to owners of the parent (62,535) (17,333)


Consolidated statement of comprehensive income


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At 31 December

USD’000 Note 2012 2011

ASSETS Non-current assets Furniture and equipment 15 3,551 2,237Intangible assets 16 80,209 48,724Long-term investments and other financial assets 17 970 1,375Deferred tax asset 25 134 253

84,864 52,589

Current assets Inventories 18 238 108Trade and other receivables 19 15,678 20,809Cash and cash equivalents 20 5,864 25,926

21,780 46,843

TOTAL ASSETS 106,644 99,432

EQUITY AND LIABILITIES Equity attributable to owners of the parent Share capital 21 6,678 5,255Share premium 226,211 178,924Cumulative change in fair value of financial assets 36 36Cumulative translation adjustment (41,971) (37,948)Accumulated losses (156,957) (98,445)

Total equity attributable to owners of the parent 33,997 47,822

Liabilities Non-current liabilities Loans and borrowings 22 7,760 5,115Trade and other payables 23 8,988 43Pension liabilities 24 817 486Deferred tax liabilities 25 3,209 6,623

20,774 12,267

Current liabilities Loans and borrowings 22 640 123Trade and other payables 23 41,949 27,369Current income tax liabilities 997 1,415Advances received 454 4,057Deferred revenue 7,833 6,379

51,873 39,343

Total liabilities 72,647 51,610

TOTAL EQUITY AND LIABILITIES 106,644 99,432


Consolidated statement of financial position


USD’000 NoteShare

capitalShare

premium

Changes in fair value of

financial assets

Cumulative translation adjustment

Accumulated losses

Total equity

Balance at 1 January 2011 5,210 175,794 36 (36,495) (82,565) 61,980

Comprehensive loss: Loss for year – – – – (15,880) (15,880)Exchange differences on translating foreign operations – – – (1,693) – (1,693)Recycling of cumulative translation adjustment on liquidation of subsidiaries – – – 240 – 240Total comprehensive loss for the year – – – (1,453) (15,880) (17,333)Exchange differences on translation of equity items (21) (681) – – – (702)Transaction with owners, recorded directly in equity Share options exercised in year 21 66 1,160 – – – 1,226Stock option expense 11 – 2,651 – – – 2,651

Total transactions with owners 66 3,811 – – – 3,877

Balance at 31 December 2011 5,255 178,924 36 (37,948) (98,445) 47,822Comprehensive loss: Loss for year – – – – (58,512) (58,512)Exchange differences on translating foreign operations – – – (4,023) – (4,023)Total comprehensive loss for the year – – – (4,023) (58,512) (62,535)Exchange differences on translation of equity items 127 4,149 – – – 4,276Transaction with owners, recorded directly in equity Shares issued on the acquisition of Synchronica 4 834 32,857 – – – 33,691Cost of share capital increases relating to the acquisition – (735) – – – (735)Rights issue during the year 21 432 10,374 – – – 10,806Cost of other share capital increases – (592) – – – (592)Share options exercised in year 21 30 – – – – 30Stock option expense 11 – 1,234 – – – 1,234

Total transactions with owners 1,296 43,138 – – – 44,434

Balance at 31 December 2012 6,678 226,211 36 (41,971) (156,957) 33,997


Consolidated statement of changes in equity


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USD’000 Note 2012 2011

Cash flows from operating activities Loss for the year (58,512) (15,880)Adjustments for: Depreciation 15 2,400 1,297Amortisation 16 17,512 16,351Impairment of intangible assets 16 21,768 –Non-cash stock option expense 11 1,234 2,651Increase (decrease) in defined benefit pension liability 122 (110)Doubtful debt expense (credit) 19 804 (300)Other non-cash expense (income) 500 (1,732)Loss on disposal of furniture and equipment 53 –Profit on disposal of intangible assets 10 (4,425) –Net finance costs (income) 12 2,718 (483)Income tax (credit) expense 13 (4,733) 1,299

(20,559) 3,093Decrease in trade and other receivables 2,524 5,298(Increase) decrease in inventories (128) 308Decrease in trade and other payables (7,354) (13,690)Decrease in deferred revenue and advances received (3,863) (1,908)Income taxes (paid) received (128) 2,911

Net cash used by operating activities (29,508) (3,988)

Cash flows from investing activities Purchases of furniture and equipment 15 (672) (851)Purchases of intangible assets 16 (657) (1,180)Capitalised development costs 16 (5,895) (4,610)Cash inflow from acquisition 4 668 –Net proceeds from sale of intellectual property 5,385 –(Increase) decrease in financial assets (40) 228

Net cash used from investing activities (1,211) (6,413)

Cash flows from financing activities Repayment of borrowings (525) (1,008)Proceeds from borrowings 2,039 2,842Proceeds from issue of share capital 21 10,836 1,226Cost of share capital increases (1,327) –Interest paid (333) (280)

Net cash generated in financing activities 10,690 2,780

Net decrease in cash and cash equivalents (20,029) (7,621)Cash and cash equivalents at beginning of year 20 25,926 33,737Effect of exchange rate fluctuations on cash and cash equivalents (33) (190)

Cash and cash equivalents at end of year 20 5,864 25,926


Consolidated statement of cash flows


1 General informationThe Myriad Group (‘Myriad’ or ‘the Group’) consists of Myriad Group AG (‘the Company’), a company incorporated in Zurich, Switzerland, and its consolidated subsidiaries. Myriad Group AG (ticker: MYRN) shares are quoted on the SIX Swiss Exchange (SIX).

The consolidated financial statements are presented in US dollars (USD), rounded to the nearest thousand. Although the parent company is domiciled in Switzerland, the consolidated financial statements are presented in USD since the Group’s cash flows are denominated to a large extent in USD.

2 Summary of significant accounting policiesThe principal accounting policies applied in the preparation of these consolidated financial statements are set out below.

2.1 Basis of preparationThe consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS), International Financial Reporting Interpretations (IFRICs) and the requirements of Swiss law. The consolidated financial statements have been prepared under the historical cost convention except for items which are required to be accounted for at fair values.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in note 3.

The principal accounting policies have been applied consistently throughout the year.

2.1.1 Going concernThese Group financial statements have been prepared on the going concern basis which is supported by detailed monthly cash flow and trading forecasts covering the period to 30 June 2014 and a medium term business plan thereafter.

The Group cash flow forecast indicates that under certain circumstances it could be reliant upon external funding within the forecast period. Subsequent to the year end the Group has agreed finance facilities in the form of loans and financial guarantees, which give it sufficient headroom to meet its financial commitments for more than twelve months after the date of this report.

On this basis, the Board and Management are satisfied that the Group has sufficient funds and facilities to meet its financial obligations as they fall due. The Group therefore continues to adopt the going concern basis in preparing its consolidated financial statements.

2.1.2 Changes in accounting policy and disclosures(a) New and amended standards adopted by the GroupThe following new standards, amendments to standards or interpretations are mandatory for the first time for the financial year beginning 1 January, 2012:

IFRS 7 (amendments), ‘Financial instruments: Disclosures’, effective for annual periods beginning on or after 1 July, 2011. The amendments have not had a material impact on the Group’s financial statements.

IAS 12 (amendments), ‘Income taxes’, effective for annual periods beginning on or after 1 January, 2012. The amendments have not had a material impact on the Group’s financial statements.

(b) New and amended standards and interpretations mandatory for the first time for the financial year beginning 1 January, 2012 but not currently relevant to the Group (although they may affect the accounting for future transactions and events)The following new standards, amendments to standards and interpretations are mandatory for the first time for the financial year beginning 1 January, 2012 but are not currently relevant to the Group:

IFRS 1 (amendment), ‘First time adoption of IFRS 1 on hyperinflation and fixed dates’ effective for annual periods on or after 1 July, 2011. This is not currently relevant to the Group.

Notes to the consolidated financial statements


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(c) New standards, amendments and interpretations issued but not effective for the financial year beginning 1 January, 2012 and not yet early adoptedThe following new standards, new interpretations and amendments to standards and interpretations have been issued but are not effective for the financial year beginning 1 January, 2012 and have not been early adopted:

IFRS 9, ‘Financial instruments’, effective for annual periods beginning on or after 1 January, 2015, though earlier adoption is permitted. The standard addresses the classification and measurement of financial assets. This is not expected to have a material impact on the Group’s financial statements.

IFRS 10, ‘Consolidated financial statements’ is effective for annual reporting periods beginning on or after 1 January, 2013. This standard builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within consolidated financial statements. This is not expected to have a material impact on the Group’s financial statements.

IFRS 11, ‘Joint arrangements’ is effective for annual periods beginning on or after 1 January, 2013. This standard provides for a more realistic reflection of joint arrangements by focusing on the rights and obligations of the arrangement, rather than its legal form. This is not currently relevant to the Group.

IFRS 12, ‘Disclosure of interests in other entities’ is effective for annual periods beginning on or after 1 January, 2013. This standard includes the disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles. This is not currently relevant to the Group.

IFRS 13, ‘Fair value measurement’ is effective for annual periods beginning on or after 1 January, 2013. This standard seeks to increase consistency and comparability in fair value measurements and related disclosures through a ‘fair value hierarchy’. The hierarchy categorises the inputs used in valuation techniques into three levels. The hierarchy gives the highest priority to (unadjusted) quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. This is not currently relevant to the Group.

IAS 1 (amendments), ‘Presentation of financial statements’ is effective for annual periods beginning on or after 1 July, 2012. The amendments to IAS 1 retain the ‘one or two statement’ approach at the option of the entity and only revise the way other comprehensive income is presented: requiring separate subtotals for those elements which may be ‘recycled’ (e.g. cash-flow hedging, foreign currency translation), and those elements that will not (e.g. fair value through OCI items under IFRS 9). The amendments are not currently expected to have a material impact on the Group’s financial statements.

IAS 19 (revised 2011) ‘Employee benefits’ is effective for annual periods beginning on or after 1 January, 2013. This amendment makes significant changes to the recognition and measurement of defined benefit pension expense and termination benefits, and to the disclosures for all employee benefits. Under IAS 19 (revised) the interest cost on the defined benefit obligation, and the expected rate of return on plan assets, will be replaced with a net interest charge based on the net defined benefit liability using the discount rate measured at the beginning of the year. This is not expected to have a material impact on the Group’s financial statements.

IAS 27 (revised) ‘Separate financial statements’ is effective for annual periods beginning on or after 1 January, 2013. This standard includes the provisions on separate financial statements that are left after the control provisions of IAS 27 have been included in the new IFRS 10. This is not currently relevant to the Group.

IAS 28 (revised) ‘Investments in associates and joint ventures’ is effective for annual periods beginning on or after 1 January, 2013. This standard includes the requirements for joint ventures, as well as associates, to be equity accounted following the issue of IFRS 11. This is not currently relevant to the Group.

2.2 ConsolidationSubsidiaries are all entities over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

The Group uses the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred and included in other operating expenses.


2 Summary of significant accounting policies continuedGoodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interests over the net identifiable assets acquired and liabilities assumed. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income statement.

Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

2.3 Segment reportingOperating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. In accordance with the management structure and the reporting made to the Board of Directors (the Group’s chief operating decision maker), the operating segments are the two business units ‘Device Solutions Division’ and ‘Mobile Services Division’. Segment reporting is prepared up to the level of EBITDA because this is the key figure used for management purposes. Information on segment assets and liabilities is not provided to the Board.

2.4 Foreign currency translationTransactions in foreign currencies are recorded at the rate of exchange at the date of the transaction. Any difference in exchange rates between the original transaction date and the subsequent settlement date is recorded in the income statement as a gain or loss.

Monetary assets and liabilities in foreign currencies are translated at year-end rates and related unrealised gains and losses are recognised in the income statement. Non-monetary assets and liabilities are translated at the exchange rate prevailing.

The net foreign exchange result is disclosed in the finance income or finance cost line.

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are presented in US dollars (‘USD’), which is the Group’s presentation currency. The results and financial position of all Group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:• assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;• income and expenses for each income statement are translated at average exchange rates where these are a reasonable

approximation of the exchange rate at the underlying transaction date;• equity items for each balance sheet presented are translated at the closing rate at the date of that balance sheet; and• all resulting exchange differences are recognised in other comprehensive income.

On consolidation, exchange differences arising from translation of the net investment in the foreign operation, and of borrowings and other currency instruments designated as hedges of such investments, are taken to other comprehensive income. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are recognised in the income statement as part of the gain or loss on sale.

2.5 Furniture and equipmentFurniture and equipment is stated at historical cost less accumulated depreciation and impairment losses. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use. The depreciation is calculated on a straight-line basis over the following estimated useful lives:• Furniture and other equipment – 5 years• IT infrastructure – 3 years• Office refurbishment – 10 years, or the remainder of the lease term if shorter• Cars – 4 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

Gains and losses on disposal are determined by comparing the proceeds with the carrying amount and are recognised within other income and expenses in the income statement.

2.6 Intangible assets(a) GoodwillGoodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets of the acquired subsidiary at the date of acquisition. For the purpose of impairment testing goodwill is allocated to

Notes to the consolidated financial statementscontinued


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those cash generating units or groups of cash generating units that are expected to benefit from the business combination in which the goodwill arose. Goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances indicate potential impairment and is carried at cost less accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.

(b) Other intangible assetsSoftware, intellectual property, customer base, and trademarks are shown at historical cost less accumulated amortisation and impairment losses. Amortisation is calculated on a straight-line basis over the following estimated useful lives:• Software – 5 years• Intellectual property – 2.5 to 7 years• Customer base – 5 years• Trademarks – 5 years

(c) Capitalised development costsThe Group expenses costs incurred in the preliminary project stage until the following criteria are met:• it is technically feasible to complete the product so that it will be available for use;• management intends to complete the product and use or sell it;• there is an ability to use or sell the product;• it can be demonstrated how the product will generate probable future economic benefits;• adequate technical, financial and other resources to complete the development and to use or sell the product are

available; and• the expenditure attributable to the product during its development can be reliably measured.

Thereafter development costs are capitalised as intangible assets.

Costs that are capitalised as part of the software product include directly attributable software development employee costs and an appropriate portion of relevant overheads. Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.

Capitalised development costs are carried at the lower of unamortised cost and recoverable amount until the product is released to customers, at which time capitalisation ceases and costs are amortised on a straight-line basis over the estimated life of the product (3 years).

2.7 Impairment of non-financial assetsAssets that have an indefinite useful life – for example, goodwill or capitalised development costs of products not yet released to customers – are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value based on the risks specific to the asset(s). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.

2.8 Financial assetsFinancial assets are classified into specified categories dependent on the nature and purpose of the financial asset. Classification is determined at the time of initial recognition. The Group currently classifies its financial assets into the following categories: ‘loans and receivables’ and ‘available for sale’.

(a) Loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than twelve months after the end of the reporting period. These are classified as non-current assets. Loans and receivables are measured at amortised cost using the effective interest rate method, less any impairment. Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial. The Group’s loans and receivables comprise certain long-term investments and other financial assets, trade and other receivables, short-term investments and marketable securities, and cash and cash equivalents.


2 Summary of significant accounting policies continued(b) Available for sale financial assetsAvailable for sale financial assets are non-derivatives that are either designated in this category or not classified in any other categories. They are included in non-current assets unless the investment matures or management intends to dispose of it within twelve months of the end of the reporting period. Available for sale financial assets are initially recognised at fair value. Gains and losses arising from changes in fair value are recognised in other comprehensive income with the exception of impairment losses and foreign exchange gains and losses on monetary assets, which are recognised directly in the income statement as other income and expenses. In the absence of an active market, and where fair value cannot be reliably measured by other means, available for sale financial assets are measured at cost, less any impairment. The Group’s available for sale financial assets comprise certain long-term investments and other financial assets.

2.9 Impairment of financial assets(a) Loans and receivablesThe Group assesses at the end of each reporting period whether there is objective evidence that a financial asset is impaired. A financial asset is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset that can be reliably estimated. The amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount is reduced and the amount of the loss is recognised in the income statement. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in the income statement.

(b) Available for sale financial assetsThe Group assesses at the end of each reporting period whether there is objective evidence that a financial asset is impaired. For debt securities the Group uses the criteria referred to in (a) above. In the case of equity investments classified as available for sale, a significant or prolonged decline in fair value of the security below its cost is also evidence that the assets are impaired. If any such evidence exists for available for sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss previously recognised in the income statement – is removed from equity and recognised in the income statement. If, in a subsequent period, the fair value of the available for sale financial asset increases and the increase can be related objectively to an event occurring after the impairment was recognised, the reversal of the previously recognised impairment loss is recognised in the income statement.

2.10 InventoriesInventories are stated at the lower of cost and net realisable value. Cost is determined using the first in, first out method and comprises direct materials and, where applicable, direct labour costs and overheads that have been incurred in bringing inventory to its present location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses.

Where Inventory is identified as slow moving, obsolete or defective a provision is made to reduce the carrying value to the net realisable value and the loss is recognised in the income statement.

2.11 Trade and other receivablesTrade receivables are initially recorded at fair value and subsequently held at amortised cost less any provision for impairment.

Additions to the provision for doubtful debts are made based on the specific identification of accounts where collection is considered to be at risk. Trade receivables are checked on a regular basis. As soon as there are indications, such as feedback obtained from account managers and other personnel in direct contact with the customer, payment history of the customer, updated credit rating reports and information available in the market, that there is a position at risk, management decides on the necessary level of the provision.

The provision for doubtful debts is reduced when the account is recovered or written off.

2.12 Short-term investmentsShort-term investments are primarily call deposits with maturities between 90 and 180 days at the time of investment and are stated at nominal value, which approximates to their fair value. These are classified as loans and receivables.



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2.13 Cash and cash equivalentsCash and cash equivalents includes cash in hand, deposits at call with banks and other short-term highly liquid investments with original maturities of three months or less.

2.14 Financial liabilitiesThe Group currently classifies its financial liabilities as ‘other financial liabilities’.

Other financial liabilities are initially measured at fair value and subsequently held at amortised cost using the effective interest rate method, with interest expense recognised on an effective yield basis. The Group’s other financial liabilities comprise loans and borrowings, and trade and other payables.

2.15 Trade payablesTrade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities. Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

2.16 Loans and borrowingsLoans and borrowings are recognised initially at fair value, net of transaction costs incurred. Loans and borrowings are subsequently carried at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method.

Loans and borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the balance sheet date.

2.17 Employee benefits – pension obligationsGroup pension funds in favour of employees are maintained in the United Kingdom (UK), the United States of America (USA), China, Switzerland, France, Canada and the Philippines. They comply with the respective legislation in each country and are financially independent of the Group. The pension funds are generally financed by employer and employee contributions. In the case of the UK, USA, Canada and China pension plans, which are accounted for as defined contribution plans, employer contributions paid or due are recognised in the income statement as employee benefit expense when they are due. The Group has no further payment obligations once the contributions have been paid.

The Swiss pension plan qualifies as a defined benefit plan. The plan offers a choice of either an annual Swiss pension amounting to an average of 6.8% of the accumulated retirement capital or a lump sum payment of the accumulated retirement capital. Other benefits include a disability pension amounting to 40% of the insured salary, death benefits, as well as related benefits in respect of the participants’ children.

The French defined benefit obligation consists of a retirement indemnity paid as a lump sum by the Company to the employee when he/she retires. The benefit is prescribed by Collective Bargaining Agreements applicable to Myriad France SAS, specifically the ‘SYNTEC’ National Collective Bargaining Agreement for both executives and non-executives. These benefits depend on the professional category, the reference salary, the seniority at retirement age and the retirement type º(at employee’s volition or employer’s volition). The retirement indemnity granted by the Company must not be lower than the legal severance pay in case of voluntary retirement.

The Philippines scheme conforms to the minimum regulatory benefit under the Retirement Pay Law (Republic Act No. 7641) which is of the defined benefit type and provides a retirement benefit equal to 22.5 days pay for every year of credited service. Obligations are paid as a lump sum amount on retirement.

The liability recognised in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets, together with adjustments for unrecognised past-service costs. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating to the terms of the related pension obligation.

Actuarial gains and losses are recognised in the income statement on a straight-line basis over the average remaining service years to the extent that they exceed 10% of the fair value of plan assets or the present value of the defined benefit obligation, whichever is higher (the ‘corridor’ approach). Any surplus is only capitalised if it is actually available to the Group in the form of expected refunds from the fund or reductions in contributions to the fund.


2 Summary of significant accounting policies continued2.17 Employee benefits – pension obligations continuedCurrent service costs are recognised immediately in the income statement; past service costs are recognised in the income statement on a straight-line basis over the period until the benefits become vested.

2.18 Current and deferred income taxThe tax benefit or expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income.

The Group incurs non-refundable withholding taxes on licence revenue earned in certain countries. In all of these situations the Group has a contractual right to receive a gross licence fee payment. The payment made by the customer in these cases is reduced by withholding taxes, typically in the range of 10-20%, which is paid by the customer to the local tax authorities. IAS 12 only refers to withholding taxes in the context of dividends or distributions to the reporting entity. In this situation it is appropriate to recognise revenue receivable in the income statement at an amount that includes (that is, gross of) any withholding taxes, but excludes any other taxes not payable wholly on behalf of the recipient. The Group treats these withholding tax deductions as an income tax paid on behalf of the Group due to its non-resident status in the local jurisdiction and includes the deduction in the income tax charge.

Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. Deferred tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred tax liability is settled. Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income tax levied by the same taxation authority on either the same taxable entity or different taxable entities when there is an intention to settle the balances on a net basis.

2.19 ProvisionsProvisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated.

2.20 Share capitalOrdinary shares are classified as equity. Mandatorily redeemable preference shares are classified as liabilities. Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity as a deduction, net of tax, from the proceeds.

Where any group company purchases the company’s equity share capital (treasury shares), the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the company’s equity holders until the shares are cancelled or reissued. Where such ordinary shares are subsequently reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the company’s equity holders.

2.21 Share-based paymentsThe Group operates equity-settled, share-based compensation plans, under which the entity receives services from employees (including Senior Executives and members of the Board of Directors) as consideration for equity instruments (options) of the Group.

The fair value of the employee services received in exchange for the grant of options is recognised as an expense. The total amount to be expensed is determined by reference to the fair value of the options granted. The fair value of the options is measured initially at grant date and is expensed on a straight-line basis over the period during which the employees become unconditionally entitled to the options, known as the vesting period. The fair value of options is measured using a binomial model, taking into account the terms and conditions upon which the options were granted. The amount recognised as expense is adjusted to reflect the actual number of stock options that are expected to vest.



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2.22 Government grantsGrants from government are recognised at their fair value where there is a reasonable assurance that the grant will be received and the Group will comply with all attached conditions. Government grants relating to costs are deferred and recognised in the income statement over the period necessary to match them with the costs that they are intended to compensate. Government grants relating to capitalised research and development costs or property, plant and equipment are included in non-current liabilities as deferred government grants and are credited to the income statement on a straight-line basis over the expected lives of the related assets.

Government grants for expenses or losses already incurred with no future related costs are recognised in the income statement in the period in which it becomes receivable.

2.23 LeasesLeases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease.

The Group leases certain property and equipment and software. Lease arrangements where the Group has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease’s commencement at the lower of the fair value of the asset and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in other long-term payables. The interest element of the finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property and equipment and software acquired under finance leases is depreciated/amortised over the shorter of the useful life of the asset and the lease term.

2.24 Revenue recognitionThe Group recognises revenue when all of the following conditions are satisfied: persuasive evidence of an agreement exists, delivery has occurred, the fee is fixed or determinable, and collection is deemed probable.

a) Licence revenueThe general revenue recognition criteria set out above are applied as follows with respect to licence revenues:• Persuasive evidence of an agreement: Myriad considers signed contracts and purchase orders as adequate documents

that provide persuasive evidence of the existence of an arrangement. If standard practice includes use of signed contracts, then persuasive evidence is provided only by a contract signed by both parties. If it is a client’s business practice to use only purchase orders, then evidence must specify governing terms and conditions.

• Delivery must have occurred: Myriad considers the delivery to have occurred upon the transfer of the product master or first copy, in the case of products sold in the Device Solutions Division, or upon formal customer acceptance, in the case of products sold in the Mobiles Services Division. Any contracts that provide for the delivery of future software, other than unspecified upgrades or enhancements, are additional elements and are initially recorded as deferred revenue. After delivery, if uncertainty exists about customer acceptance of the software, recognition of licence revenue is deferred until acceptance occurs.

• Fees must be fixed or determinable: In the Device Solutions Division, Myriad considers a fee to be fixed or determinable if the amount of the unit fee and number of copies is defined in the contractual agreement with the customer. In the Mobile Services Division, the fee is considered to be fixed when the capacity level and related price has been agreed.

• Collection must be probable: Myriad has a close relationship with its customers and carefully monitors their creditworthiness. Collection is deemed probable if Myriad expects that the customer will be able to pay amounts under the arrangement as payments become due. If Myriad determines that collection is not probable, revenue is deferred and recognised upon cash collection.

Device Solutions DivisionStandard terms of the licence agreements for the Device Solutions Division require the licensee to document the total number of shipments of products incorporating Myriad’s technology and report this data to Myriad on a quarterly basis.

A majority of contracts irrevocably commit the customer to a guaranteed minimum order over a specified term of typically two to three years. Committed volume contracts include a fixed fee and require payment throughout the life of the contract generally based on quarterly royalty reports, whereby any amount not consumed by the customer will become due at the end of the contract. Other committed volume contracts provide for fixed instalment payment terms. Based on past experience and the nature of the contractual cash flows of such contracts, the Group recognises revenues when payments become due, i.e. based on the quarterly royalty reports or any other specified payment terms.


3 Critical accounting estimates and judgementsEstimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates may not equal the related actual results. 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 addressed below.

a) Capitalisation of development costsOnce the criteria set out in note 2.6(c) have been met the Group capitalises related development costs until such time as the customer product incorporating the software is commercialised, at which time capitalisation ceases. However, there can be no assurance that such products will complete the development phase or will be commercialised or that market conditions will not change in the future requiring a revision of management’s assessment of such future cash flows which could lead to additional amortisation or impairment charges. The Group has capitalised development costs with a net value of USD 8,491,000 at 31 December, 2012, as disclosed in note 16.

b) Allocation of purchase price to identifiable intangible assets and goodwill In the context of the acquisition of a business the allocation of the purchase price to the fair value of net assets acquired requires significant judgement in the estimation of future cash flows associated with the intangible assets acquired. Actual outcomes could vary significantly from such estimates of discounted future cash flows and could result in shortened useful economic lives or impairment. The Group has recognised separately identifiable intangible assets of USD 18,770,000 and goodwill of USD 44,147,000 from the acquisition of Synchronica.

c) Estimated useful life of intangible assetsIntangible assets are amortised over estimated useful life of between 2.5 and 7 years. Estimated useful life is based on the Group’s operating experience. As the Group continues to evolve, it is possible that product life cycles may shorten which could have the impact of shortening the amortisation period in the future and could increase amortisation accordingly. The net carrying values of the Group’s intangible assets are disclosed in note 16.

2 Summary of significant accounting policies continuedLicence agreements pursuant to which customers commit to purchase Myriad’s software for a specified period of time but that do not specify minimum purchasing requirements are referred to as duration contracts. Duration contracts also include a fixed fee, which is based on the number of shipments. Under duration contracts, customers report the number of devices shipped incorporating Myriad software on a quarterly basis, and are invoiced for licence fees accordingly. Revenue is recognised under such contracts based upon the quarterly royalty reports.

Mobile Services DivisionStandard terms of the licence agreements for the Mobile Services Division call for the sale of a licence which permits a server to manage up to a specified number of Unstructured Supplementary Service Data (USSD) messages per second, known as capacity-based licences. These licences are sold to mobile operators as part of a turnkey solution, which includes installation and other services. Myriad recognises revenue from the sale of its capacity-based software licences upon formal acceptance of the full solution by the customer. Installation and other services are accounted for separately.

In addition, Myriad recognises all of the costs related to the sale of such licences, including the cost of licences and selling expenses, at the time revenue is recognised.

b) Service revenueService revenue consists of non-recurring engineering, installation, training, consulting, and technical support services. Revenue on fixed-price projects, for which Myriad’s engineering services contracts typically are incurred, is recognised based on an estimated percentage of completion as work progresses. Where revenue is recognised in advance of amounts being invoiced the difference is shown as accrued income in trade and other receivables. Estimated losses on fixed-price service arrangements are recognised immediately when it becomes apparent a loss will be incurred. After such a determination, it is possible that actual losses realised will be greater than the estimate previously recorded. These differences could be material. Revenue from training and consulting service elements is generally recognised as the services are performed. Maintenance contracts include second level support to the customer and there is generally a time and response commitment made to the customer to resolve software issues. Maintenance revenue is recognised on a straight-line basis over the period of the contracts.



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4 Acquisition of Synchronica plcOn 7 March, 2012 the Board of Myriad announced the terms of its recommended increased share offer for the entire issued and to be issued share capital of Synchronica plc. Under the terms of the offer, Synchronica plc shareholders received 4.83 new Myriad shares for every 100 Synchronica shares.

On 16 April, 2012 Myriad announced that the recommended increased share offer for the entire issued and to be issued ordinary share capital of Synchronica plc (the “Offer”) had been declared unconditional in all respects. As of 16 April, 2012 Myriad had received valid acceptances of the Offer totalling 80.68% of the issued share capital of Synchronica plc. This equated to 6,184,567 Myriad shares.

On 30 April, 2012 Myriad announced that it held or had agreed to acquire approximately 90.93% of the existing issued ordinary share capital of Synchronica plc and intended to exercise its rights pursuant to the provisions of sections 974 to 991 (inclusive) of the Companies Act 2006 to acquire compulsorily any outstanding Synchronica plc shares not acquired or agreed to be acquired pursuant to the Offer or otherwise.

d) Income taxAt 31 December, 2012, the net liability for current income taxes is USD 997,000 and the net liability for deferred income taxes is USD 3,075,000, as disclosed in note 25. Current tax liabilities are measured on the basis of an interpretation of the tax regulations in place in the relevant countries. Management believes that the estimates are reasonable and that the recognised assets and liabilities taking into account income tax-related uncertainties are adequate. Various internal and external factors may have favourable or unfavourable effects on the income tax assets and liabilities. The adequacy of this interpretation is assessed by the tax authorities in the course of the final assessment or tax audits. This can result in material changes to tax expense. Furthermore, in order to determine whether tax loss carry forwards may be carried as an asset, it is first necessary to critically assess the probability that there will be future taxable profits against which to offset them. This assessment depends on a variety of influencing factors and developments. Changes in these factors may have a material effect on the income tax charge.

e) Legal claimsThe Group is currently engaged in on-going legal actions with Oracle America Inc, Motorola and Raima. In December 2010, Oracle America Inc filed a claim in the U.S. District Court for the Northern District of California for USD 3,500,000 in unpaid royalties. In June 2011, Myriad Group AG and Myriad France SAS received summons from the United States District Court, Northern District of Illinois, Eastern Division in relation to proceedings by Motorola Mobility to recover USD 7,200,000 for loss of profits relating to three alleged defects affecting browser software. On 23 August 2012 Myriad France SAS was served with a complaint for breach of contract and copyright infringements from Raima, Inc. In response, Myriad filed a motion to dismiss Raima’s claims. On 12 December, 2012, the Judge dismissed Raima’s claims for US copyright, French copyright, malicious prosecution and abuse of process, all with prejudice. Further hearings on these matters are scheduled to take place in 2013, and at this stage the outcome of these cases is uncertain. Appropriate amounts have been accrued.

f) Sagem termination agreementFollowing the termination of the Sagem Wireless contracts, Myriad has embarked on restructuring the Myriad France SAS business and has incurred costs relating to the ongoing employment and establishment costs for a number of staff. Under the terms of the settlement agreement from 1 November, 2010 Sagem Wireless was committed to provide employment for these people either directly or within the wider SAFRAN group of companies, and to reimburse the establishment costs, or pay redundancy costs if redeployment was not possible. This agreement was also signed by Sagem Telecommunications and FCPR Sofinnova Capital VI, represented by Sofinnova Partners, in support of Sagem Wireless as shareholders. Sagem Wireless (renamed MobiWire) filed for insolvency in the French courts on 31 March, 2011. As result of MobiWire going into administration, Myriad Group is now seeking legal redress against the MobiWire shareholders. Based on legal advice provided to Myriad France SAS and the assessment of the contractual agreements the Board and Management believe that the Sagem Wireless shareholders, who were signatories to the settlement agreement, should be held liable for any breach of that agreement by their affiliated company. As the legal action is still in its early stages, and the outcome is uncertain, the Myriad Board and Management are not recognising an asset relating to the recovery of these costs. The total costs incurred to date not recovered from MobiWire are USD 12,014,000 (EUR 9,016,000).


4 Acquisition of Synchronica plc continuedOn 4 May, 2012 Myriad announced the despatch of formal compulsory acquisition notices, in the prescribed form under section 980(1) of the Companies Act 2006, to all Synchronica shareholders who had not to date accepted the Offer, giving notice of its intention to exercise its right under section 979 of the Companies Act 2006 to acquire compulsorily any remaining Synchronica shares in respect of which the Offer had not been accepted on the same terms as the Offer.

On 15 June, 2012 following the expiry of six weeks from the date of the compulsory acquisition notices, Myriad announced that it had received valid acceptances under the Offer in respect of 150,549,170 Synchronica plc shares, representing approximately 94.85% of the existing issued ordinary share capital of Synchronica plc. Synchronica plc shares held by those Synchronica plc shareholders who had not accepted the Offer were acquired compulsorily under the same terms of the Offer.

As 100% of the equity interest of Synchronica was acquired within the period and the offer remained the same throughout the period the acquisition has been accounted for as a single acquisition following the substance of the transaction.

Synchronica plc is a public company incorporated in England and Wales with registered number 03276547 and traded on AIM (AIM: SYNC) (admitted December 2004), as well as the TSX Venture Exchange (TSXV:SYN) (admitted September 2010). Synchronica is headquartered in the UK and operates development centres in Germany and the Philippines. Synchronica also has a commercial presence in several strategic locations in the Americas, the Middle East and Africa and the Asia Pacific regions.

Synchronica is a developer of next-generation mobile messaging solutions based on open industry standards. Synchronica’s business is now predominantly based on its flagship product, Mobile Gateway, providing push email, synchronisation, instant messaging, backup and restore and mobile connectivity to popular social networking services.

Synchronica’s products are white-labelled and offered by mobile service providers and device manufacturers in emerging and developed markets. Synchronica’s patented transcoding technology uses advanced streaming to download email attachments and reduce the consumption of wholesale network bandwidth by as much as 90%.

Following the acquisition Synchronica plc delisted from AIM on 16 May 2012 and subsequently on 2 November 2012 formerly re-registered under the Companies Act 2006 as a private company incorporated under the name of Synchronica Limited.

The acquisition of Synchronica plc had the following effect on the Group’s assets and liabilities:

Effect of the acquisition on 16 April 2012USD’000

Book value (pre-acquisition)

Fair value adjustments Fair value

Furniture and equipment 2,303 – 2,303Intangible assets 46 18,724 18,770Long-term investments and other financial assets 47 – 47Deferred tax asset 48 – 48Trade and other receivables 7,676 (1,499) 6,177Short-term investments and marketable securities 2 - 2Cash and cash equivalents 668 – 668Loans and borrowings (2,632) – (2,632)Trade and other payables (32,791) 415 (32,376)Current income tax liabilities (101) – (101)Deferred revenue (1,192) – (1,192)Deferred tax liabilities – (2,170) (2,170)

Total identifiable net assets (25,926) 15,470 (10,456)

Goodwill 44,147

33,691

Settled by: 7,665,552 equity shares of the parent company 33,691

Total purchase consideration 33,691



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5 Segment informationManagement has determined that the operating segments based on the reports reviewed by the Board of Directors (the Group’s chief operating decision maker) that are used to make strategic decisions are as follows:

a) Device Solutions Division: includes activities of the embedded software platforms and middleware including browser, messaging and Jbed Java Virtual Machine clients and related services.

b) Mobile Services Division: the Group provides mobile operators with network service platforms and software for mass market phones including the extensive service portfolio in the Unstructured Supplementary Service Data (USSD) business and the Xumii social messaging platform. The acquired Synchronica business, including the Unity messaging platform, has been included within this Division.

ConsiderationThe fair value of the 7,665,552 shares issued on 16 April 2012 was based on the published closing share price on 15 April 2012, being CHF 4.04.

GoodwillThe goodwill of USD 44,147,000 arising from the acquisition is attributable to the acquired workforce, expected cost synergies and economies of scale expected from combining the operations of the Group and Synchronica plc. None of the goodwill is expected to be deductible for income tax purposes.

Fair value adjustmentsA contingent liability of USD 500,000 has been recognised in relation to a previous acquisition completed by Synchronica plc. The amount represents the latest reliable estimate of the potential liability.

A provision of USD 774,000 has been recognised against grant income receivable due to uncertainty over the likely recoverability.

As a result of a difference in revenue recognition policy the accrued income of the Synchronica group has been reduced by USD 725,000.

Other payables were overestimated in the books of Synchronica at the date of acquisition by USD 915,000 and have therefore been adjusted.

Acquisition-related costsTotal acquisition related costs of USD 3,875,000 were incurred in the twelve months ended 31 December 2012. USD 735,000 directly relates to the issuance of share capital and has been recognised in equity. USD 3,140,000 has been recognised in other expenses in the consolidated income statement (see note 10).

Acquired receivablesThe fair value of trade and other receivables is USD 6,177,000 and includes trade receivables with a fair value of USD 3,419,000. The gross contractual amount for trade receivables due is USD 3,447,120 of which USD 28,000 is expected to be uncollectable.

Loans and borrowingsLoans and borrowings include USD 2,000,000 payable to Myriad Group AG, which was advanced to Synchronica on 7 March 2012.

Revenue and profit contributionThe acquired business contributed revenues of USD 15,924,000 and net losses of USD 13,506,000 to the Group for the period from 16 April 2012 to 31 December 2012. If the acquisition had occurred on 1 January 2012 consolidated revenue and consolidated losses for the year ended 31 December 2012 would have been USD 65,193,000 and USD 65,860,000 respectively.


5 Segment information continuedSegment information is as follows:

Device Solutions Division Mobile Services Division Total Myriad Group

USD’000 2012 2011 2012 2011 2012 2011

Licence revenue 14,313 30,931 11,855 2,705 26,168 33,636Service revenue 12,030 18,752 18,090 8,633 30,120 27,385

Total revenue 26,343 49,683 29,945 11,338 56,288 61,021

EBITDA pre restructuring costs 591 15,283 (6,648) (6,370) (6,057) 8,913

Restructuring costs(see note 6) (1,834) (3,961) (3,216) (885) (5,050) (4,846)EBITDA1 (1,243) 11,322 (9,864) (7,255) (11,107) 4,067Depreciation (2,400) (1,297)Amortisation (17,512) (16,351)Impairment (21,768) –Profit on sale of intellectual property 4,425 –Exclusivity fees (7,015) –Impairment of investment in Eflow Inc. (500) –Proceeds from legal settlement with Openwave Systems Inc – 12,000Legal fees incurred by Openwave settlement – (2,739)French social plan costs not reimbursed by Sagem Wireless (1,510) (10,504)Synchronica acquisition expenses (3,140) –Loss on liquidation of subsidiaries – (240)

Loss from operations (60,527) (15,064)Finance income 14 763Finance costs (2,732) (280)

Loss before income tax (63,245) (14,581)

1. EBITDA is earnings before interest, tax, depreciation, amortisation, impairment and non-recurring items.

The Group has not disclosed segmental information in respect of segment assets and liabilities as this information is not provided to the chief operating decision maker.

The following table summarises revenue by geographic region based on customers’ location.

USD’000 2012 % share 2011 % share

EMEA Switzerland 1,739 3.1% – 0.0% France 4,049 7.2% 3,969 6.5% Other EMEA 7,858 14.0% 10,054 16.5%Americas United States of America 8,803 15.6% 6,766 11.1% Canada 6,463 11.5% – 0.0% Other Americas 4,704 8.4% 3,376 5.5%Asia Pacific Korea 9,371 16.6% 13,295 21.8% China 7,739 13.7% 12,008 19.7% Japan 4,251 7.6% 11,528 18.9% Other Asia Pacific 1,311 2.3% 25 0.0%

Total 56,288 100.0% 61,021 100.0%

Of the above revenue, significant amounts from individual customers in 2012 were MediaTek (USD 6,143,000, 2011: USD 5,137,000), Nokia (USD 5,933,000, 2011: USD 9,000) and Orange (USD 7,335,000, 2011: USD 6,106,000).



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6 Restructuring and integration costsRestructuring and integration costs are allocated as follows:

USD’000 2012 2011

Cost of revenue (see note 7) 481 542Research and development 2,485 1,535Sales and marketing (see note 8) 671 675General and administrative (see note 9) 1,413 2,094

Total restructuring and integration costs 5,050 4,846

2012With the acquisition of Synchronica plc and its subsidiary companies in April 2012, management embarked on a major restructuring exercise integrating and consolidating the combined Group. This has mainly impacted upon duplicated management roles, engineering and back office support functions with a total cost incurred of USD 5,050,000, of which USD 4,498,000 relates to personnel costs associated with 149 employees across engineering and back office, with a further USD 552,000 related to office consolidation.

2011Management has continued to reorganise and restructure the Group as part of an ongoing cost rationalisation exercise. This has mainly impacted upon engineering and back office support functions with a total cost incurred of USD 4,846,000, of which USD 3,540,000 relates to personnel costs associated with 37 employees across engineering and back office, with a further USD 1,306,000 related to office consolidation.

7 Cost of revenueCost of revenue includes amortisation of intangible assets and allocated restructuring costs as follows:

USD’000 2012 2011

Cost of licence revenue 6,264 426Cost of service revenue 21,747 17,709Amortisation of intangible assets (see note 16) 17,512 16,351Restructuring and integration costs (see note 6) 481 542

Cost of revenue 46,004 35,028

The following table summarises furniture and equipment and intangible assets by geographic region based on their location and allocation respectively:

USD’000 2012 % share 2011 % share

EMEA Switzerland 79,232 94.6% 9,461 18.6% France 227 0.3% 38,228 75.0% UK 3,115 3.7% 2,546 5.0%Americas 718 0.9% 176 0.3%Asia Pacific 468 0.5% 550 1.1%

Total 83,760 100.0% 50,961 100.0%

Assets allocated to Switzerland include goodwill (USD 52,265,000, 2011: USD Nil) and intellectual property (USD 15,019,000, 2011: USD 232,000)

Assets allocated to France include goodwill (USD Nil, 2011: USD 16,646,000) and intellectual property (USD Nil, 2011: USD 19,881,000).



10 Other income and expense

USD’000 2012 2011

Other income: Income from government grants 91 2,618Other income 28 420Profit on sale of intellectual property 4,425 –Proceeds from legal settlement with Openwave Systems Inc – 12,000

Total other income 4,544 15,038

Other expenses: Legal fees incurred by Openwave settlement – (2,739)French social plan costs not reimbursed by Sagem Wireless (1,510) (10,504)Synchronica acquisition expenses (see note 4) (3,140) –Impairment of investment in Eflow Inc (see note 17) (500) –Provision against grant income (303) –Loss on liquidation of subsidiaries – (240)

Total other expenses (5,453) (13,483)

Income from government grantsMyriad France participated in two grant schemes funded by the French Government. One scheme relates to a specific research and development project that completed in 2011; according to the terms of the arrangement part of this funding was received in the form of a government grant and part was received as a loan repayable if the resulting technology is successfully commercialised and generates a certain level of revenue.

The second scheme relates to the development of new mobile technology, in addition to maintaining a level of research and development employment within the locality the development takes place. This scheme also finished during 2011.

9 General and administrative costsIncluded within general and administrative costs are the following amounts:

USD’000 2012 2011

General and administrative costs 10,383 12,791Depreciation (see note 15) 2,400 1,297Restructuring and integration costs (see note 6) 1,413 2,094Doubtful debt expense (see note 19) 804 (300)

Total general and administrative costs 15,000 15,882

8 Sales and marketing costsIncluded within sales and marketing costs are the following amounts:

USD’000 2012 2011

Sales and marketing 9,518 11,030Exclusivity fees 7,015 –Restructuring and integration costs (see note 6) 671 675

Total sales and marketing costs 17,204 11,705

Exclusivity Fees Included within sales and marketing costs are non-recurring costs of USD 7,015,000 relating to the write-down of exclusivity fees paid by the Group to guarantee exclusivity of Xumii products in certain geographical territories.


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11 Employee compensation and benefits(a) Personnel expensesPersonnel expenses included in cost of revenue as well as in other operating expenses consisted of the following:

Employee compensation and benefits

USD’000 2012 2011

Salaries and wages 34,368 30,416Social taxes 6,282 4,492Pension cost (see note 24) 1,136 1,356Capitalised development costs (see note 16) (5,895) (4,610)Other personnel-related costs 1,139 833Stock option expenses 1,234 2,651

Total expenses 38,264 35,138

Remuneration for Senior Management and the Board of Directors is disclosed in note 30.

(b) Stock option plansAll employees of the Group are eligible to receive stock options.

The stock options are granted at regular Board meetings at an exercise price equivalent to the stock market closure price of the Company shares on the grant date, or at the nominal value of the Company share. All options grant employees the right to purchase one Company share per option and are exercisable after the vesting conditions are satisfied. The Compensation and Nomination Committee reviews and is the competent body for approving the grant of employee options. In general, the contractual life of the options is 10 years from the grant date.

All outstanding options are covered by the conditional share capital.

Openwave legal settlementIn September 2011 Myriad received USD 12,000,000 in settlement of a legal case relating to Intellectual Property ownership rights from Openwave Systems Inc. Legal costs of USD 2,739,000 incurred in relation to this have been disclosed separately as they are both material in size and not relating to recurring operating activities.

Sagem termination agreementFollowing the termination of the Sagem Wireless contracts, Myriad embarked on restructuring the Myriad France SAS business and has incurred costs relating to the ongoing employment and establishment costs for a number of staff. This was substantially completed in 2011. During 2012 final provisions and costs were incurred of USD 1,510,000 relating to amounts required to complete this restructuring. Under the terms of the settlement agreement from 1 November, 2010 Sagem Wireless was committed to provide employment for these people either directly or within the wider SAFRAN group of companies, and to reimburse the establishment costs, or pay redundancy costs if redeployment is not possible. This agreement was also signed by Sagem Telecommunications and FCPR Sofinnova Capital VI, represented by Sofinnova Partners, in support of Sagem Wireless as shareholders. Sagem Wireless (renamed MobiWire) filed for insolvency in the French courts on 31 March, 2011. As a result of MobiWire going into administration, Myriad Group is now seeking legal redress against the MobiWire shareholders. Based on legal advice provided to Myriad France SAS and the assessment of the contractual agreements the Board and Management believe that the Sagem Wireless shareholders, who were signatories to the settlement agreement, should be held liable for any breach of that agreement by their affiliated company. As the legal action is still in its early stages, and the outcome is uncertain, the Myriad Board and Management are not recognising an asset relating to the recovery of these costs. The total costs incurred to date not recovered from MobiWire are USD 12,014,000 (EUR 9,016,000).



11 Employee compensation and benefits continuedThe following table details the movements of outstanding employee stock options from 1 January until 31 December:

2012 2011

‘000 No.Weighted average exercise price CHF No.

Weighted average exercise price CHF

At 1 January 2,719 2.51 3,600 2.90

Granted 200 3.27 1,334 0.31

Exercised (292) 0.10 (580) 1.86

Lapsed (1,343) 3.08 (1,635) 1.94

At 31 December 1,284 2.57 2,719 2.51

Thereof vested and exercisable 288 0.02 338 0.42

Weighted average fair value of options granted CHF 1.89 CHF 2.98

Weighted average exercise price of options exercised CHF 0.10 CHF 1.86

Weighted average exercise price of options lapsed CHF 3.08 CHF 1.94

Exercise price for options outstanding at year-end CHF 0.00 - 18.60 CHF 0.00 – 18.60

The following tables summarise the employee stock options outstanding as at 31 December, 2012 and 2011, respectively:

Expiry dates

Options outstandingat 31 December 2012 (‘000)

Exercise price (CHF) 2012 2013 2014 2015 2016 2019 2020 2021 2022

243 0.00 7 222 14

349 0.10 2 121 42 171 13

30 2.75 30

69 3.21 69

1 3.30 1

33 3.60 33

39 4.27 39

250 4.49 250

20 4.57 20

78 4.90 18 60

50 5.00 50

7 5.70 7

97 6.29 32 65

3 8.25 3

13 9.55 13

2 18.60 2

1,284 - 144 1 371 273 79 119 221 76


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Expiry dates

Options outstandingat 31 December 2011 (‘000)

Exercise price (CHF) 2011 2012 2013 2014 2015 2016 2019 2020 2021

262 0.00 221 41

1,114 0.10 2 1,112

100 3.21 100

1 3.30 1

50 4.27 50

30 4.45 30

410 4.49 410

20 4.55 20

20 4.57 20

130 4.90 30 100

50 5.00 50

10 5.01 10

237 5.15 237

9 5.70 9

257 6.29 257

4 8.25 4

13 9.55 13

2 18.60 2

2,719 – – 19 1 647 262 328 300 1,162

At 31 December, 2012, non-executive members of the Board of Directors held 33,333 employee stock options at an exercise price of CHF 3.60 (2011: 50,000 employee stock options at exercise prices ranging from CHF 4.55 to CHF 5.15 per share).

At 31 December, 2012, Executive Management members held 548,715 employee stock options at exercise prices ranging from CHF 0.10 to CHF 5.00 per share (2011: 1,552,430 employee stock options at exercise prices ranging from CHF 0.10 to CHF 4.90 per share).

The fair value of employee stock options granted is estimated at the date of grant using a binomial model, taking into account the terms and conditions upon which the options were granted. Inputs to the model are as follows:

2012 2011

Dividend yield 0.00% 0.00%Expected volatility 47.40% - 63.85% 66.60% – 75.00%Historical volatility 47.40% 66.60%Risk-free interest rate 0.04% - 0.41% 0.32% – 1.33%Expected life of option 5 to 6.58 years 2 to 4.5 yearsWeighted average share price 3.39 3.56Exercise price 3.27 0.28

Due to the short trading history of the Company the expected volatility is based on the historical volatility of a selection of comparable companies, reflecting an assumption that this will be indicative of future trends for the Company, which may not necessarily be the actual outcome.

The expense for employee services received is recognised over the vesting period. The amount of stock option expense recognised in 2012 was USD 1,234,000 (2011: USD 2,651,000).


13 Income tax

USD’000 2012 2011

Current income tax: Current tax on profits for the year (1,333) (3,011)Adjustments in respect of prior years 604 98

Total current income tax expense (729) (2,913)

Deferred income tax: Origination and reversal of temporary differences 5,462 1,614

Total deferred income tax credit 5,462 1,614

Total income tax credit (expense) 4,733 (1,299)

The Group has operations mainly in Switzerland, France, USA, China, Korea, Canada, the United Kingdom and branch offices dispersed throughout Europe and Asia that have differing tax laws and rates. Consequently, the effective tax rate on consolidated income may vary from year to year, according to the source of earnings. The following table reconciles the loss before income tax per the income statement to the income tax benefit, computed using the applicable tax rate of the headquarters, Zurich (Switzerland):

USD’000 2012 2011

Loss before income tax (63,245) (14,581)Income tax rate of Myriad Group AG 20.85% 20.85%

Tax benefit at Myriad Group AG income tax rate 13,187 3,040Expenses not deductible for tax purposes (460) (710)Utilisation of previously unrecognised tax losses 915 1,850Movement in unrecognised deferred tax assets (9,133) (5,778)Permanent differences relating to goodwill impairment (2,942) –De-recognition of deferred tax asset (122) –Effect of different tax rates in foreign jurisdictions 3,457 2,849Non-refundable withholding taxes1 (941) (2,583)Adjustment in respect of prior years 604 98Effect of R&D tax credit – 179Other 168 (244)

Income tax credit (expense) 4,733 (1,299)

1 Non-refundable withholding taxes (see accounting policy note 2.18).

12 Finance income/costs

USD’000 2012 2011

Other finance income 14 –Foreign exchange gains, net – 763

Finance income 14 763

Interest expense (125) (81)Other finance costs (222) (199)Unwind of discount on deferred consideration (see note 23) (1,454) –Foreign exchange losses, net (931) –

Finance costs (2,732) (280)

Net finance (costs) income (2,718) 483



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15 Furniture and equipment

USD’000 FurnitureIT

infrastructureOffice

refurbishingOther

equipment Total

Cost At 1 January 2011 669 2,610 658 634 4,571Additions 32 704 192 – 928Translation adjustments (4) (96) 6 11 (83)

At 31 December 2011 697 3,218 856 645 5,416Additions – 1,270 99 58 1,427Acquisition of Synchronica plc 14 1,646 – 643 2,303Disposals (32) (42) (33) – (107)Translation adjustments 8 172 11 (13) 178

At 31 December 2012 687 6,264 933 1,333 9,217

Accumulated depreciation At 1 January 2011 475 774 269 466 1,984Charge for year 57 1,031 149 60 1,297Translation adjustments (9) (103) 14 (4) (102)

At 31 December 2011 523 1,702 432 522 3,179Charge for year 58 1,932 139 271 2,400Disposals (13) (41) – – (54)Translation adjustments 13 130 6 (8) 141

At 31 December 2012 581 3,723 577 785 5,666

Net book value at1 January 2011 194 1,836 389 168 2,587

Net book value at 31 December 2011 174 1,516 424 123 2,237

Net book value at 31 December 2012 106 2,541 356 548 3,551

14 Loss per shareLoss per share is calculated as follows:

2012 2011

Net loss for the year attributable to owners of the parent (USD’000) (58,512) (15,880)Weighted average of ordinary shares outstanding during the year (‘000) 55,832 48,785Aggregate number of equivalent ordinary shares for purpose of calculating the basic and diluted loss per share (‘000) 55,832 48,785Loss per share (USD): – basic (1.05) (0.33)– diluted (1.05) (0.33)

Due to the fact that the Group incurred net losses during the years presented, the potential ordinary shares from options granted to employees (total potential shares at 31 December, 2012 and 2011, respectively: 1,283,726 and 2,719,495) did not have any dilutive effect on the Group’s loss per share.


15 Furniture and equipment continuedIT infrastructure includes the following amounts where the Group is a lessee under a finance lease:

USD’000 2012 2011

Cost – capitalised finance leases 2,079 74

Accumulated depreciation (789) (12)

Net book value 1,290 62

The Group leases various items of IT infrastructure under non-cancellable finance lease agreements. The leases are repayable over 3 years and ownership of the assets lies within the Group.

The Group did not have any capital commitments relating to the acquisition of furniture and equipment, other than the amounts recognised as liabilities in the balance sheet, as at 31 December, 2012.

The fire insurance value of furniture and equipment at 31 December, 2012 amounts to USD 9,217,000 (2011: USD 5,416,000).

Depreciation expense is allocated to ‘general and administrative costs’, see note 9.

16 Intangible assets

USD’000 Goodwill SoftwareIntellectual

property Customer base

Capitalised development

costs Trademarks Total

Cost At 1 January 2011 62,798 1,941 77,597 5,311 23,504 74 171,225Additions – 1,438 – – 4,610 – 6,048De-recognition (741) – (25,714) – – – (26,455)Translation adjustments (2,004) (181) (1,664) (171) (402) (3) (4,425)

At 31 December 2011 60,053 3,198 50,219 5,140 27,712 71 146,393Additions – 527 1,908 – 5,895 – 8,330Acquisition of Synchronica plc 44,147 46 15,233 3,491 – – 62,917De-recognition (43,659) – (23,977) – (8,607) (73) (76,316)Disposals – – (2,596) – – – (2,596)Translation adjustments 934 192 743 80 446 2 2,397

At 31 December 2012 61,475 3,963 41,530 8,711 25,446 – 141,125

Accumulated amortisation At 1 January 2011 45,596 789 45,917 5,223 13,589 73 111,187Charge for year – 954 11,385 89 3,922 1 16,351De-recognition (741) – (25,714) – – – (26,455)Translation adjustments (1,448) (165) (1,481) (172) (145) (3) (3,414)

At 31 December 2011 43,407 1,578 30,107 5,140 17,366 71 97,669Charge for year – 861 11,787 467 4,397 – 17,512Impairment 8,787 – 9,554 – 3,427 – 21,768Disposals – – (1,610) – – – (1,610)De-recognition (43,659) – (23,977) – (8,607) (73) (76,316)Translation adjustments 675 114 650 80 372 2 1,893

At 31 December 2012 9,210 2,553 26,511 5,687 16,955 – 60,916

Net book values at 1 January 2011 17,202 1,152 31,680 88 9,915 1 60,038

Net book values at 31 December 2011 16,646 1,620 20,112 – 10,346 – 48,724

Net book values at 31 December 2012 52,265 1,410 15,019 3,024 8,491 – 80,209

Internally-generated intangible assets at 31 December 2012 solely include capitalised development costs USD 8,491,000 (2011: USD 10,346,000).



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Software includes the following amounts where the Group is a lessee under a finance lease:

USD’000 2012 2011

Cost – capitalised finance leases 260 249

Accumulated amortisation (78) (25)

Net book value 182 224

The Group leases various items of software under non-cancellable finance lease agreements. The leases are repayable over 3 years and ownership of the assets lie within the Group.

Amortisation expense is allocated to ‘cost of revenue’, see note 7.

Cash generating unitsWith improved visibility of costs and revenues in 2012 the Group’s cash generating units (’CGU’) have been reassessed during 2012 with the significant decline of legacy browser and messaging revenues associated with the acquisition of the Purple Labs businesses in 2009. The goodwill and intangible assets relating to the acquisition of Purple Labs and subsequent capitalised development costs, previously allocated to the Device Solutions CGU have been reallocated to the Purple Labs CGU and their value in use assessed against the future cash flows expected to be earned from this declining revenue stream. The remaining Device Solutions CGU now includes Java and Connected Home products. This has resulted in an impairment charge on these assets of USD 20,220,000 which would not have otherwise been taken.

Impairment testThe group of intangible assets allocated to each CGU, including goodwill, is tested for impairment on at least an annual basis. The value in use is determined based on future discounted cash flows.

As a basis for the calculation, the three-year mid-term operating plan is used. Subsequent years are included in the calculation using a perpetual annuity. The projections and growth rates applied are based on historic performance and also on judgements made by management as to the probable economic development of the relevant segments. Assumptions used in the weighted average cost of capital calculation are derived from observable external information.

IAS 36 requires the discount rate for value in use calculations to be calculated on a pre-tax basis. The pre-tax discount rates are derived from the Group’s post tax weighted average cost of capital and adjusted for specific risks of the different CGU’s associated cash flow projections.

The following parameters have been used for the calculations:

2012 2011

Discount rate

(pre-tax)Discount rate

(post-tax)

Terminal Growth rate

(residual value)Discount rate

(pre-tax)Discount rate

(post-tax)

Terminal Growth rate

(residual value)

Purple Labs 17.31% 13.70% – – – –Device Solutions 17.31% 13.70% 2.00% 17.81% 14.10% 2.00%Mobile Services Division 17.31% 13.70% 3.00% 17.81% 14.10% 3.00%

The 2.00% Device Solutions growth rate reflects management’s assessment of the long-term growth outlook arising from the Group’s portfolio of Connected Home applications. The higher Mobile Services Division (MSD) growth rate of 3.00% reflects latest management’s expectations of additional growth arising from MSD’s portfolio of social messaging solutions.

Sensitivity analyses of goodwill related to the Device Solutions Division:

Amount of excess (+)/necessary impairment (-) in USD million depending on

Growth/discount rate (post-tax) 11.70% 12.70% 13.70% 14.70% 15.70%

0% 76.03 69.08 63.16 58.06 53.63 1% 81.14 73.22 66.56 60.88 55.99 2% 87.30 78.13 70.53 64.15 58.70 3% 94.88 84.05 75.25 67.97 61.84 4% 104.43 91.33 80.94 72.50 65.52 5% 116.83 100.5 87.94 77.97 69.88


16 Intangible assets continuedAs an example: if a discount rate of 12.70% and a growth rate of 3% were applied in the calculation – the recoverable amount would be higher than the carrying amount of the goodwill of the CGU by USD 84.05 million.

Sensitivity analyses of goodwill related to the Mobile Services Division:

Amount of excess (+)/necessary impairment (-) in USD million depending on

Growth/discount rate (post-tax) 11.70% 12.70% 13.70% 14.70% 15.70%

0% 3.04 (5.21) (12.20) (18.19) (23.38) 1% 9.29 (0.15) (8.04) (14.74) (20.49) 2% 16.83 5.86 (3.18) (10.75) (17.17) 3% 26.11 13.11 2.59 (6.07) (13.33) 4% 37.80 22.02 9.56 (0.52) (8.83) 5% 52.97 33.25 18.12 6.17 (3.50)

Impairment charges2012Following the decline in legacy Purple Labs browser and messaging revenues during 2012 and the reduced outlook for these products in the future, the value in use calculation shows an impairment charge of USD 20,220,000 taken against the goodwill and intangible assets allocated to the Purple Labs CGU.

No impairment charges have been booked against the Device solutions CGU.

Following the acquisition of Synchronica management have initiated the consolidation of messaging platforms, with the target to offer all services from the Unity platform. This decision has led to an impairment charge of USD 1,548,000 against intangible assets associated with the Xumii platform which were included within the MSD CGU.

Intangible assets and goodwill recognised on the acquisition of Synchronica have been included in the MSD CGU. Management has reviewed the latest market conditions and considered the appropriate parameters to be applied in the calculation of the value in use calculation. The future discounted cash flows supported the carrying values of goodwill, intellectual property and capitalised development costs associated with the MSD CGU, and no impairments are made in the year.

2011Management reviewed the latest market conditions and considered the appropriate parameters to be applied in the calculation of the value in use calculation. The future discounted cash flows supported the carrying values of goodwill, intellectual property and capitalised development costs associated with the DSD and MSD cash generating units, and no impairments were made in the year.

Analysis of impairment charge:

USD’000 2012 2011

Purple Labs Goodwill 8,787 –Intellectual property 9,409 –Capitalised development costs 2,024 –

Total Purple Labs 20,220 –

MSD Intellectual property 145 –Capitalised development costs 1,403 –

Total MSD 1,548 –

Total 21,768 –



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18 Inventories

USD’000 2012 2011

Inventories 238 108

Total 238 108

17 Long-term investments and other financial assets

USD’000 2012 2011

Loans and receivables Security deposits 967 789Long-term loan 3 89

970 878

Assets available for sale Investment in eflow Inc. - 497

- 497

Total 970 1,375

Loans and receivables include rent deposits for offices. These deposits bear interest at current market rates.

The Group has a 9.58% (2011: 9.58%) interest in eflow Inc, Japan. Management has reassessed the fair value at the year end as nil, resulting in an impairment charge of USD 500,000 during 2012.

The Group also has a 19.99% (2011: 19.99%) interest in Javaground Inc, USA. The fair value of this interest is considered to be USD nil (2011: USD nil).

19 Trade and other receivables

USD’000 2012 2011

Trade receivables 8,424 4,298Less provisions for impairment (1,183) (276)

Net trade receivables 7,241 4,022VAT receivables 605 1,023Withholding tax receivables 1,442 1,512Other receivables 24 91Accrued income 5,753 5,696Prepaid exclusivity fees (see note 8) - 7,143Other prepaid expenses 613 1,322

Total 15,678 20,809

An impairment review has been undertaken at the year end to assess whether the carrying amount of financial assets is deemed recoverable. The primary credit risk relates to customers which have amounts due outside of their credit period.

Goodwill has been allocated to the Group’s cash generating units (‘CGU’) as follows:

USD’000 2012 2011

Device Solutions Division - 8,653Mobile Services Division 52,265 7,993

Total amount of goodwill 52,265 16,646

At 31 December, 2012 the Group has an obligation to acquire intangible assets of USD 1,780,000 (2011: nil). This is included within accrued expenses (note 23).

Amounts derecognised in the year relate to those fully amortised or impaired intangible assets that the Group does not expect to derive any future benefit from.


19 Trade and other receivables continuedTrade receivables past due, but not impaired and ageing analysis of amounts impaired:

2012 2011

USD’000 Gross Provision Net Gross Provision Net

Not yet due 4,567 (690) 3,877 2,115 – 2,115Amounts past due: 1-30 days overdue 2,049 - 2,049 736 – 73631-60 days overdue 791 - 791 281 – 28161-90 days overdue 501 (123) 378 127 – 12791-120 days overdue 180 (38) 142 – – –More than 120 days overdue 336 (332) 4 1,039 (276) 763

Total 8,424 (1,183) 7,241 4,298 (276) 4,022

Movements in provision for impairment of trade receivables:

USD’000 2012 2011

At 1 January (276) (3,310)Arising on acquisition of Synchronica (28) -Amounts written off - 2,700Additional provisions (1,076) (345)Unused provision reversed 272 645Translation adjustments (75) 34

At 31 December (1,183) (276)

The carrying amounts of the Group’s net trade receivables are denominated in the following currencies:

USD’000 2012 2011

US Dollar (USD) 4,800 2,176Euro (EUR) 1,623 1,457Chinese Yuan (CNY) 112 78Other 706 311

Total 7,241 4,022

20 Cash and cash equivalents

USD’000 2012 2011

Cash at banks and petty cash 5,864 25,926

Total 5,864 25,926



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21 Share capitalThe Company’s shares are registered shares with a nominal value of CHF 0.10 each.

2012 2011

Number

of sharesShare capital

USD’000Number

of sharesShare capital

USD’000

Issued capital at 1 January 49,140,515 5,255 48,560,611 5,210Shares issued through exercise of employee stock options 291,795 30 579,904 66Shares issued in connection with business combinations 7,665,552 834 – –Shares issued through rights issues 4,035,798 432 - -Translation adjustment - 127 – (21)

Issued capital at 31 December 61,133,660 6,678 49,140,515 5,255

Thereof treasury shares 20 - 20 –

At 31 December: Authorised unissued share capital - - – –Conditional share capital 2,898,891 317 3,895,688 417

Shares issued through exercise of employee stock optionsDuring 2012, 291,795 employee stock options were exercised resulting in net proceeds to the Company of CHF 28,075 (USD 30,070). During 2011, 579,904 employee stock options were exercised resulting in net proceeds to the Company of CHF 1,076,367 (USD 1,226,000).

Shares issued in connection with business combinationsIn April 2012 the Company increased its share capital out of the authorised share capital by 7,665,552 shares in connection with the acquisition of Synchronica plc. Transaction costs incurred in relation to the share issue were USD 735,000.

Shares issued through a rights issueIn September 2012, a rights issue of 1 share for every 14 shares in issue resulted in an increase in issued share capital of CHF 403,580 (USD 432,256) and an increase in the share premium account of CHF 9,685,915 (USD 10,374,140). Transaction costs incurred in relation to the rights issue were USD 592,000.

Authorised unissued share capitalAt 31 December, 2012, the authorised unissued share capital is nil (2011: nil). At the Extraordinary General Meeting held on 23 February 2012, shareholders approved the creation of authorised share capital in the amount of CHF 1,170,135, consisting of 11,701,350 registered shares with a nominal value of CHF 0.10 each.

Conditional share capitalOf the conditional capital of CHF 289,889.10 (2,898,891 shares of CHF 0.10 each) as at 31 December, 2012 (2011: CHF 389,568.80, 3,895,688 shares of CHF 0.10 each), CHF 289,889.10 (2011: CHF 319,068.60) is reserved for the exercise of stock option rights which may be granted to members of the Board of Directors (‘Board’), employees of the Group as well as members of an Advisory Board (not established) under Group stock option plan(s) as approved by the Board. The subscription rights of the shareholders with respect to these shares are excluded.

Conditional capital of CHF 70,500.20 held at 31 December, 2010, reserved for the exercise of conversion rights which were granted to investors in Myriad’s convertible bonds, expired on 30 September, 2011. The conditional capital relating to these Convertible Notes therefore expired. The Board of Directors deleted the relevant article 3b of the Articles of Incorporation on 23 February, 2012.


23 Trade and other payables

USD’000 2012 2011

Trade payables 5,794 3,337VAT and other tax related payables 217 405Other payables 2,211 920Deferred consideration 13,021 -Employee compensation related accruals 5,723 6,136Accrued exclusivity fees 2,637 2,611Accrued expenses 21,334 14,003

Total 50,937 27,412

Of which: Current 41,949 27,369Non-current 8,988 43

Total 50,937 27,412

On 29th July, 2011 Synchronica Limited (formally Synchronica plc) acquired Nokia’s North America Network Operator business in a transaction which included USD 21,160,000 of deferred consideration. As a result of the acquisition of Synchronica detailed in note 4, the obligation is now underwritten by the Myriad Group. At 31 December, 2012 the total outstanding contractual payments were USD 15,831,000, to be settled by quarterly payments of USD 1,150,000 with the balance to be paid on 31 December, 2015.

The present value of these contractual payments at 31 December, 2012 was USD 13,031,000 using a discount rate of 15%.

In January, 2013 the payment terms were renegotiated to suspend the quarterly payments until November, 2013 and the final payment date to 31 December, 2016. The total contractual cash flows remain unchanged.


22 Loans and borrowings

USD’000 2012 2011

Repayable government loans 7,122 4,974Finance lease liabilities 1,278 264

Total 8,400 5,238

Of which: Current 640 123Non-current 7,760 5,115

Total loans and borrowings 8,400 5,238

a) Repayable government loansMyriad France participates in a R&D programme under which it receives financing from the French Government. According to the terms of the arrangement part of the funding is received in the form of a government grant (see note 10) and part is received as a repayable loan if the resulting technology was successfully commercialised and generated a certain level of revenue. Repayable government loans are not discounted due to uncertainty in respect of the repayment period. They are carried at the value of the original proceeds and incur no interest.

b) Finance lease liabilitiesLease liabilities are effectively secured as the rights to the leased asset revert to the lessor in the event of default.

USD’000 2012 2011

Amounts payable under finance leases: Within one year 755 123In the second to fifth years inclusive 633 171

1,388 294Less: future finance charges (110) (30)

Present value of finance lease liabilities 1,278 264


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24 Pension liability and related costsThe following disclosures relate to the pension plans in Switzerland, France and the Philippines, which qualify as defined benefit plans.

The amounts recognised in the balance sheet are determined as follows:

USD’000 2012 2011

Present value of defined benefit obligations 777 497Fair value of plan assets (36) (31)

Deficit of funded plans 741 466Unrecognised net actuarial loss (gain) 134 80Unrecognised past service cost (58) (60)

Total recognised pension liability of defined benefit plans 817 486

The movement in the present value of the defined benefit obligation over the year is as follows:

USD’000 2012 2011

At 1 January 497 1,519Acquisition of Synchronica 136 –Current employer service cost 91 64Interest cost 32 15Employee contributions 2 15Insurance premiums (2) (8)Plan settlement – (860)Plan curtailment – (199)Actuarial (gain) loss 12 (99)Translation adjustments 9 50

At 31 December 777 497

The movement in the fair value of plan assets over the year is as follows:

USD’000 2012 2011

At 1 January 31 820Expected return on assets 1 –Employer contributions 2 8Employee contributions 2 15Insurance premiums (2) (8)Plan settlement – (860)Actuarial gain 1 8Translation adjustments 1 48

At 31 December 36 31

The amounts recognised in the income statement are as follows:

USD’000 2012 2011

Current employer service cost 91 64Interest cost 32 15Expected return on plan assets (1) –Actuarial (gain)/loss recognised (3) –Plan curtailment – (191)Amortisation of past service cost 3 3

Cost of defined benefit plans 122 (109)Cost of defined contribution plans 1,014 1,465

Total pension cost for the year (note 11) 1,136 1,356

Expected net periodic pension costs of defined benefit plans for the next financial year are USD 72,000.Expected employer contributions for defined benefit plans for the next financial year are USD 2,000.


24 Pension liability and related costs continuedThe principal weighted average actuarial assumptions, used for the calculation of the defined benefit obligation as well as the net periodic pension cost, were as follows:

2012 2011

Discount rate 4.06% 4.61%

Expected return on plan assets 3.30% 3.37%

Expected rate of salary increases 3.53% 2.00%

Expected rate of pension increases 0.00% 0.50%

Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience. Mortality assumptions for the Swiss pension plan are based on the BVG 2010 post-retirement mortality table (2011: BVG 2010).

The five-year history of experience adjustments is as follows:

USD’000 2012 2011 2010 2009 2008

Present value of defined benefit obligation (777) (497) (1,519) (4,372) (4,934) Fair value of plan assets 36 31 820 3,330 2,718 Deficit in the plan (741) (466) (699) (1,042) (2,216) Experience losses (gains) on plan liabilities – amount 12 (91) (92) (30) (10) Experience gains (losses)on plan assets – amount 1 8 19 173 (359)

The analysis of the plan assets and the expected rate of return at the balance sheet date were as follows:

2012Expected return

in 2012 2011Expected return

in 2011

Equity securities 23.30% 5.75% 20.10% 5.93%Debt securities 53.10% 1.89% 56.40% 2.25%Real estate 10.40% 4.00% 10.40% 3.75%Other 13.20% 3.31% 13.10% 3.63%

100.00% 3.37% 100.00% 3.37%

The actual return on plan assets was 6.5% (2011: 1.0%)

25 Deferred income taxThe analysis of deferred tax assets and liabilities is as follows:

USD’000 2012 2011

Deferred tax assets: – Deferred tax asset to be recovered after more than 12 months – 253– Deferred tax asset to be recovered within 12 months 134 –

134 253

Deferred tax liabilities: – Deferred tax liability to be recovered after more than 12 months (2,772) (4,376)– Deferred tax liability to be recovered within 12 months (437) (2,247)

(3,209) (6,623)

Deferred tax liabilities (net) (3,075) (6,370)



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26 Operating leasesThe Group leases various offices and equipment under non-cancellable operating lease agreements. The future aggregate minimal lease payments under non-cancellable operating leases are as follows:

USD’000 2012 2011

Within one year 3,512 1,718In the second to fifth years inclusive 5,285 1,723After five years 348 765

Total 9,145 4,206

The amounts charged in arriving at the loss from operations for the year in respect of operating leases was USD 2,832,000 (2011: USD 2,041,000).

The following are the major deferred tax liabilities and assets recognised by the Group and movements thereon:

USD’000

Intangible assets (excluding goodwill)

Othertemporary

differences

Other deferred tax

assets Total

At 1 January 2011 (8,222) (117) 228 (8,111)Credited to the income statement 1,522 78 14 1,614Translation adjustments 121 (5) 11 127

At 31 December 2011 (6,579) (44) 253 (6,370)Credited (charged) to the income statement 5,543 41 (122) 5,462Arising on acquisition of Synchronica (2,122) - - (2,122)Translation adjustments (42) (6) 3 (45)

At 31 December 20121 (3,200) (9) 134 (3,075)

1 The deferred tax assets/liabilities are calculated at the respective closing exchange rate whereas the changes in temporary differences shown in note 12 showing the components of income tax expense are calculated at the average rate of the respective year.

At the balance sheet date the Group has unused tax losses available for offset against future profits as follows:

USD’0002

Expiry date 2012 2011

2012 – 18,4502013 75,623 74,0302014 18,157 17,7752015 8,527 8,3472016 42,594 41,6962017 12,331 12,0712019 22,466 –2022 947 –2032 29,588 –To be carried forward unlimited 121,407 50,572

Total 331,640 222,941

2 The tax losses carried forward and the deferred tax assets/liabilities are calculated at the respective closing exchange rate. Therefore, the movements in unrecognised tax loss carry forwards include currency conversion differences.

Unused tax losses referred to above are available for use in Canada, France, Switzerland and the United Kingdom where the current tax rates are 26.90%, 33.33%, 20.85% and 24.00% respectively.


27 Guarantees, pledges in favour of third parties and contingent liabilitiesThe Group is currently engaged in on-going legal actions with Oracle America Inc, Motorola and Raima. In December 2010 Oracle America Inc filed a claim in the US District Court for the Northern District of California for USD 3,500,000 in unpaid royalties. On the same date Myriad made a claim against Oracle America Inc for USD 120,000,000 in overpaid royalties pursuant to a separate licence agreement relating to different technologies. In June 2011 Myriad Group AG and Myriad France SAS received summons from the US District Court, Northern District of Illinois, Eastern Division in relation to proceedings by Motorola Mobility to recover USD 7,200,000 for loss of profits relating to three alleged defects affecting browser software. Further hearings on these matters are scheduled 2013, and whilst at this stage the outcome of both cases is uncertain, the Board and Management consider that negative outcomes of these litigations are remote.

Myriad France SAS, Mobiwire and SAGEM Telecommunications are currently contesting a writ from 45 former employees instituted on 27 July, 2011 in the labour court of Pontoise for additional compensation in connection with the alleged nullity of the Social Plan of Myriad France SAS. The Myriad Board and Management consider that a negative outcome of this litigation is remote. This follows the Sagem Termination agreement completed in 2010.

On 23 August, 2012 Myriad France SAS was served with a complaint for breach of contract and copyright infringements from Raima, Inc. In response, Myriad filed a motion to dismiss Raima’s claims. On 12 December, 2012, the Judge dismissed Raima’s claims for US copyright, French copyright, malicious prosecution and abuse of process, all with prejudice.

The Group may grant guarantees in the normal course of business. At 31 December 2012, performance guarantees and tender bonds had been issued to customers and prospects by the Mobile Services Division totalling USD 278,000 (2011: USD 1,105,000). All such bank guarantees were secured by liens in amounts equal to the guaranteed amounts on cash accounts held at the issuing banks.

Management are not aware of any other significant commitments or contingent liabilities which have not been disclosed in these consolidated financial statements.

28 Financial instrumentsThe following table shows the carrying amount of all financial instruments by category:

USD’000 Note 2012 2011

Financial assets Assets available for sale: Long-term investments and other financial assets 17 – 497Loans and receivables: Long-term investments and other financial assets 17 970 878Net trade receivables 19 7,241 4,022Other receivables 19 24 91Accrued income 19 5,753 5,696Cash and cash equivalents 20 5,864 25,926

19,852 37,110

Financial liabilities Other financial liabilities: Loans and borrowings 22 8,400 5,238Deferred consideration 23 13,021 –Trade payables 23 5,794 3,337Other payables 23 2,211 920Employee compensation related accruals 23 5,723 6,136Accrued exclusivity fees 23 2,637 2,611Accrued expenses 23 21,334 14,003

59,120 32,245

The Group has no financial instruments carried at fair value. The Board of Directors considers that the carrying amount of financial instruments approximates their fair value. Due to the absence of an active market and as fair value cannot be reliably measured by other means, assets available for sale are measured at cost less any impairment.



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29 Financial risk managementFinancial risk factorsThe Board of Directors bears ultimate responsibility for risk management. Management has to ensure that adequate control processes and mechanisms are in place and that internal resources are set aside to carry out risk management in an efficient and effective way. Management monitors risk management and reports to the Board on a regular basis.

The Group’s activities expose it to a variety of financial risks: market risk (including currency risk and interest rate risk), credit risk and liquidity risk. The following sections provide an overview of each of these risks.

(a) Market riskThe Group is exposed to a variety of market risks, principally including the effect of changes in interest rates and changes in foreign currency exchange rates.

(i) Foreign exchange riskRevenue in the parent company generally arises in US Dollars and Euros whereas the related costs are incurred in Swiss Francs. Revenue and related costs in the Chinese subsidiary generally arises in Chinese Yuan. Revenue in the French subsidiary generally arises in US Dollars and Euros whereas the related costs are incurred in Euros. Revenue in the Canadian subsidiary generally arises in US Dollars and Canadian Dollars whereas the related costs are incurred in Canadian Dollars. Operating costs in other Group companies are generally incurred in local currencies.

At 31 December, 2012, if other currencies (predominantly Euros, Swiss Francs, Sterling, Canadian Dollars, South Korean Won and Chinese Yuan) had weakened/strengthened by 10% against the USD with all other variables held constant, the loss before income tax would have been USD 2,116,000 (2011: USD 415,000) higher/lower. This sensitivity analysis includes only outstanding non-USD denominated financial instruments. Based on foreign exchange rate fluctuations compared to USD experienced during 2012 a 10% (2011: 10%) fluctuation is deemed a reasonable possibility.

(ii) Interest rate riskInterest rate risk arises from movements in interest rates, which could have adverse effects on the Group’s net income or financial position. The Group has no significant interest rate exposure. The Group places its cash and cash equivalents primarily in short-term interest-bearing accounts. Information on the Group’s interest-bearing liabilities is set out in note 21. Revenue and operating cash flows are substantially independent of changes in market interest rates.

(b) Credit riskCredit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations.

Bank deposits, cash equivalents and short-term investments are placed with banks and financial institutions with a rating of at least ’A-’ as measured by Standard & Poor’s.

Concentration of credit risk is primarily associated with trade receivables. The Group has numerous customers located in a variety of geographical regions. The Group’s policy is to only recognise revenue on the achievement of payment milestones and based on customer royalty reports, all invoices are payable within contractual terms based on the invoice date.

The Group establishes an allowance for doubtful debts that represents its best estimate of incurred losses in respect of trade and other receivables. The allowance is based on specific loss components that relate to individually significant exposures.

The maximum credit risk on financial instruments corresponds to the carrying amount of the individual financial assets.


29 Financial risk management continued(c) Liquidity riskLiquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. A shortage of liquid assets can occur at any point in time due to an unfavourable development in the operation of the business.

The Group places a high priority on the monitoring of liquidity risk and takes corrective action at an early stage to ensure financial obligations can be met as they arise. The appropriate level of liquidity is maintained through credit lines, negotiation of terms of certain debt instruments or further financing through major stakeholders.

The following tables show the maturity of the financial liabilities:

Maturity analysis of financial liabilities as at 31 December, 2012:

USD’000Carrying amount

Future finance charges

Undiscounted contractual

cash flowamount Within 1 year 1-2 years 2-5 years

Loans and borrowings 8,400 110 8,510 755 516 7,239Deferred consideration 13,021 2,810 15,831 5,750 4,600 5,481Trade payables 5,794 – 5,794 5,794 – –Other payables 2,211 – 2,211 2,166 45 –Employee compensation related accruals 5,723 – 5,723 5,723 – –Accrued exclusivity fees 2,637 – 2,637 2,637 – –Accrued expenses 21,334 – 21,334 19,959 1,375 –

Total financial liabilities 59,120 2,920 62,040 42,784 6,536 12,720

Maturity analysis of financial liabilities as at 31 December, 2011:

USD’000Carrying amount

Future finance charges

Undiscounted contractual

cash flowamount Within 1 year 1-2 years 2-5 years

Loans and borrowings 5,238 30 5,268 123 123 5,022Trade payables 3,337 – 3,337 3,337 – –Other payables 920 – 920 877 43 –Employee compensation related accruals 6,136 – 6,136 6,136 – –Accrued exclusivity fees 2,611 – 2,611 2,611 – –Accrued expenses 14,003 – 14,003 14,003 – –

Total financial liabilities 32,245 30 32,275 27,087 166 5,022


Capital managementThe Board’s policy is to maintain a strong capital base so as to maintain investor, other stakeholder and market confidence and to sustain future development of the business.

The Group monitors capital on the basis of the debt:equity ratio. This ratio is calculated as debt divided by total capital. Debt is calculated as total interest bearing loans and borrowings (including non-current and current loans and borrowings). Total capital is calculated as equity (as shown in the consolidated balance sheet) plus debt. The target of the Group is to maintain a strong capital base and maintain the debt: equity ratio below 50%

USD’000 2012 2011

Debt 1,278 264Equity 36,275 48,086

Ratio 3.6% 0.5%


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30 Related party transactionsRelated parties are members of the Executive Management Team, the Board of Directors and close family members of the aforementioned parties, and shareholders holding in excess of 20% of the share capital, as well as entities under these parties’ control.

There were no transactions with related parties during the years ended 31 December, 2012 and 31 December, 2011. Sofinnova Partners, who held in excess of 20% of the share capital during 2010, are signatories to the Sagem Wireless settlement agreement referred to in note 10.

Compensation paid to the members of the Board of Directors and Key ManagementCompensation paid to the members of the Board of Directors in 2012:

USD’000 Cash

compensationNumber of

options grantedShare option

expense4

Total compensation

2012

Loek van den Boog Resigned 20121 59 30 6 65Erik Hansen Chairman of the Board, Head of CNC2 211 33 44 255David Arnott Board Member, Head of AC, Member CNC 37 – – 37Richard Schlauri Board Member, Member AC, Member CNC 25 – – 25Simon Wilkinson Board Member, CEO3 – 37 – –

Total 332 100 50 382

1 Loek van den Boog served as Chairman and Chair of the Audit Committee. He did not stand for re-election at the AGM of 29th May, 2012.2 Erik Hansen was elected Vice Chairman of the Board on 23 February, 2012. Effective 23 February, 2012 he became Head of CNC replacing Loek van den Boog. He was

elected Chairman at the AGM on 29th May, 2012. For a period between September, 2012 and December, 2012 he served as Executive Chairman following the resignation of Simon Wilkinson until the appointment of Stephen Dunford.

3 Simon Wilkinson’s remuneration is disclosed under the Key Management compensation note below. He resigned from the Board in October, 2012.4 The charge noted above is the charge for 2012 based on the fair value of options allocated over their vesting periods.

AC = Audit CommitteeCNC = Compensation and Nomination Committee

Compensation paid to the members of Key Management in 2012:

USD’000Annual salary Bonus1

Share option expense2

Total 20123

Key Management 2,314 99 520 2,933of whom Simon Wilkinson, former CEO 291 – 45 336Gordon Tsang (highest individual compensation) 432 99 156 687

1 Bonus remuneration disclosed in 2012 relates to amounts paid or payable in respect of 2012 performance made to members of key management who left during the year.

2 The share options awarded in 2012 are awarded under the Senior Management Performance and Retention Scheme. The charge noted above is the charge for 2012 based on the fair value of options allocated over their vesting periods.

3 All severance payments made to members of key management are contractual and therefore included in the analysis above under the relevant heading to which they relate.

Indirect benefits paid in 2012:

USD’000Social

insurance PensionsOther

benefitsTotal2012

Key Management 319 57 21 397of whom Simon Wilkinson, former CEO 91 – 4 95Gordon Tsang (highest individual compensation) – 25 – 25



30 Related party transactions continuedCompensation paid to the members of the Board of Directors in 2011:

USD’000 Cash


options grantedShare option

expense7

Totalcompensation

2011

Loek van den Boog Chairman of the Board, Member AC, Head of AC1 118 – 37 155

Michel Paulin Board Member2 52 – – 52Hans-Ulrich Müller Board Member3 – – – –Michel Bon Board Member4 – – – –Simon Wilkinson Board Member, CEO5 – – – –

Total 170 – 37 207

1 Loek van den Boog served as Head of the CNC from 1 January, 2011 to 23 February, 2012 when he relinquished the role to Erik Hansen. Effective 18 October, 2011 he became Head of the AC following the resignation of Michel Paulin.

2 Michel Paulin resigned as Head of the AC and Board member on 18 October, 2011.3 Hans-Ulrich Müller resigned as Vice Chairman and Board member on 19 May, 2011.4 Michel Bon resigned as a Board member on 13 April, 2011.5 Simon Wilkinson’s remuneration is disclosed under the Key Management compensation note below.6 The charge noted above is the charge for 2011 based on the fair value of options allocated over their vesting periods.



USD’000Annual salary Bonus1

Share option expense2

Total 2011

Key Managementof whom

2,679 151 2,127 4,957

Simon Wilkinson, CE0 (highest individual compensation) 403 – 459 862

1 Bonus remuneration disclosed in 2011 relates to amounts paid or payable in respect of 2011 performance made to members of key management who left during the year.

2 The share options awarded in 2011 are awarded under the Senior Management Performance and Retention Scheme. The charge noted above is the charge for 2011 based on the fair value of options allocated over their vesting periods.


USD’000Social


benefitsTotal2011


360 19 19 398

Simon Wilkinson, CEO (highest individual compensation) 116 – 1 117


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Shareholdings of members of the Board of Directors, Key Management or persons related to them as at 31 December:

2012 2011

Number of

sharesNumber of

options3

Number of shares

Number of options

Loek van den Boog Resigned 2012 – – 75,913 50,000Michel Paulin Resigned 2011 – – – 26,116Erik Hansen1 Chairman of the Board, Head CNC – 33,333 – –David Arnott2 Board Member, Head AC, Member CNC – – – –Richard Schlauri2 Board Member, Member AC, Member CNC – – – –Simon Wilkinson Resigned 2012 391,502 87,500 1,032,662 427,500James Bodha Chief Financial Officer – 395,215 – 658,033Stephen Dunford Chief Executive Officer – – – –Mike Grant Chief Marketing Officer – 50,000 – –Kim Hartlev Chief Technology Officer – 30,000 – –Ed Zylka Senior Vice President Device Solutions

Division– 50,000 – 50,000

Benoit Schillings Resigned 2011 – – – 159,718Malcolm Dawe Resigned 2011 – – – 177,220Gary Bunney Resigned 2012 – 51,113 – 127,000Mike Brady Resigned 2012 – 38,335 – 123,000Gordon Tsang Resigned 2012 – 18,750 – 50,875James Robins Resigned 2012 – 41,891 – 78,660Liz Hitchen Resigned 2013 – 73,500 – 87,362

1 Erik Hansen was awarded a further 30,000 share options in January, 2013 as part of his compensation package.2 In January, 2013 David Arnott and Richard Schlauri were each awarded 30,000 share options relating to their appointment as board members and a further 10,000

share options as part of their executive compensation package.3 The movement in share options between 2011 and 2012 includes 1,088,648 of surrendered share options.

31 Events after the reporting periodThe Board of Directors authorised these consolidated financial statements on 11 March, 2013 for issue on 12 March, 2013. They are subject to approval at the Annual Meeting of Shareholders to be held on 29 April, 2013.

In January, 2013 the payment terms of the deferred consideration included within note 23 were renegotiated to suspend the quarterly payments until November, 2013 and the final payment date to 31 December, 2016. The total contractual cash flows remain unchanged.

In January and February, 2013 the Group secured short term loans with a total value of CHF 5,200,000 (USD 5,650,000) repayable on 31 December, 2013, and a letter of financial support for amounts up to USD 8,000,000 for the period up to 31 March, 2014.


32 Principal subsidiariesThe Group has the following shareholdings of the ordinary share capital of its principal subsidiaries:

NameShare capital

(million)Country of incorporation Function

Proportion of voting rights held

in 2012

Proportion of voting rights

held in 2011

Myriad Mobile Software Inc USD 0.1 USA Sales and Support 100% 100%

Myriad (China) Co. Ltd CNY 2.0 ChinaEngineering services, Sales and Support 100% 100%

Myriad Technology AG CHF 1.0 Switzerland Administrative 100% 100%

Myriad Group Korea Co. Ltd KRW 50.8 South KoreaEngineering services, Sales and Support 100% 100%

Myriad France SAS EUR 0.5 FranceEngineering services, Sales and Support 100% 100%

Myriad Group UK Ltd GBP 0.01 UK Administrative 100% 100%

Myriad Japan Inc JPY 5.0 JapanEngineering services, Sales and Support 100% 100%

Myriad Group Australia Pty Ltd AUD 0.02 AustraliaEngineering services, Sales and Support 100% 100%

Myriad Software Solutions Private Ltd INR 0.1 IndiaEngineering services, Sales and Support 100% 100%

MG Mobile Software Mexico, S. De R. L. De C. V. USD 0.02 Mexico

Engineering services, Sales and Support 100% 100%

Synchronica Ltd USD 37.4 UK Sales and Support 100% –

Synchronica America Ltd GBP 0.03 UK Sales and Support 100% –

Project Robin II Ltd GBP 0.04 UK Administrative 100% –

Axis Mobile Ltd USD 0.2 Israel Dormant 100% –

Axis Mobile APAC Ltd Dormant 100% –

Axis Mobile Inc Dormant 100% –

Synchronica Software GmbH EUR 0.05 Germany Engineering services 100% –

Synchronica Mobile Gateway Pty Ltd INR 0.1 IndiaEngineering services, Sales and Support 100% –

Synchronica Philippines Inc. PHP 8.6 Philippines Engineering services 100% –

Synchronica Inc. CAD 32.0 CanadaEngineering services, Sales and Support 100% –

1 Myriad Group (UK) Ltd’s share capital is GBP 1.2 Myriad Group Australia Pty Ltd’s share capital is AUD 100.3 Synchronica America Ltd’s share capital is GBP 100.4 Project Robin II Ltd’s share capital is GBP 1.5 Synchronica Software GMBH’s share capital is EUR 25,000.



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Report of the statutory auditor on the consolidated financial statementsAs statutory auditor, we have audited the consolidated financial statements of Myriad Group AG, which comprise the consolidated income statement, consolidated statement of comprehensive income, consolidated statement of financial position, consolidated statement of changes in equity, consolidated statement of cash flows and notes (pages 29 to 70), for the year ended 31 December, 2012.

Board of Directors’ responsibilityThe Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the International Financial Reporting Standards (IFRS) and the requirements of Swiss law. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibilityOur responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards as well as the International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation and fair presentation of the consolidated financial statements 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 entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the consolidated financial statements for the year ended 31 December, 2012 give a true and fair view of the financial position, the results of operations and the cash flows in accordance with the International Financial Reporting Standards (IFRS) and comply with Swiss law.

Report on other legal requirementsWe confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence.

In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists which has been designed for the preparation of consolidated financial statements according to the instructions of the Board of Directors.

We recommend that the consolidated financial statements submitted to you be approved.

PricewaterhouseCoopers Ltd

Martin Kennard Stefanie BoehmAudit expert Audit expertAuditor in charge

Zurich, 12 March, 2013

Report of the statutory auditor to the general meeting of Myriad Group AG, Zurich


Myriad Group AG, ZurichIncome statement For the year ended 31 December

CHF Note 2012 2011

Licence revenue 10,530,698 15,087,816Service revenue 7,782,794 7,320,119Revenue with group companies 25,728,218 –

Total revenue 44,041,710 22,407,935

Cost of revenue 4.2 (25,507,695) (4,476,955)

Total cost of revenue (25,507,695) (4,476,955)

Gross profit 18,534,015 17,930,980Research and development, net of capitalised costs (9,943,452) (7,358,542)Sales and marketing 4.3 (14,008,100) (2,175,373)General and administrative 4.4 (15,984,152) (7,360,793)Other income 4.5 1,445,100 7,087,424Other expense 4.5 (466,162) (489,219)

(Loss) profit from operations (20,422,751) 7,634,477Finance income 498,208 1,114,776Finance costs (640,525) (17,811)

(Loss) profit before taxes (20,565,068) 8,731,442Income taxes (547,719) (1,606,432)

Net (loss) profit (21,112,787) 7,125,010

Statutory financial statements


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Balance sheet At 31 December

CHF Note 2012 2011

ASSETS Non-current assets Financial assets – Investments 3 35,181,862 4,213,032– Value adjustment on investments (1,631,677) (1,167,208)– Loans to group companies 20,573,622 20,694,612– Value adjustment on loans to group companies (20,573,622) (20,694,612)– Loans to third parties 903,244 903,224– Value adjustment on loans to third parties (903,244) (903,224)– Security deposits and other financial assets 280,662 288,068Own shares 2 2Furniture and equipment 325,289 168,600Intangible assets 7,616,383 1,234,486

41,772,521 4,736,980

Current assets Trade receivables due from: – third parties 1,502,860 852,517– group companies 4,146,246 4,154,695Other receivables due from: – third parties 1,363,202 1,616,818Prepaid expenses and accrued income 1,229,822 8,963,916Cash and cash equivalents 3,145,085 13,798,948

11,387,215 29,386,894

TOTAL ASSETS 53,159,736 34,123,874


Balance sheet continued At 31 December

CHF Note 2012 2011

EQUITY AND LIABILITIES Shareholders’ equity Share capital 5 6,113,366 4,914,052Legal reserve (share premium) – 2,209,607Legal reserve from capital contributions 51,482,997 –Other reserves (share premium) – 10,637,989Reserve for own shares 2 2Accumulated losses – Accumulated losses brought forward (4,162,746) (11,287,756)– Net (loss) profit for the year (21,112,787) 7,125,010

32,320,832 13,598,904

Current liabilities Trade payables due to: – third parties 936,905 1,343,142Other current liabilities due to: – third parties 144,911 284,623– group companies 1,260,514 1,387,819Advance customer payments 415,813 3,793,264Accrued expenses 13,640,825 10,828,917Deferred revenue 4,439,936 2,887,205

20,838,904 20,524,970

Total liabilities 20,838,904 20,524,970

TOTAL EQUITY AND LIABILITIES 53,159,736 34,123,874

Statutory financial statements continued


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1 General informationMyriad Group AG (‘the Company’) is a company incorporated in Zurich, Switzerland, whose shares are quoted on the SIX Swiss Exchange.

The accompanying financial statements present information relating to the Company only and are presented in Swiss Francs (CHF).

2 Significant accounting policiesThe accompanying financial statements have been prepared in accordance with the requirements of Swiss law and the Company’s Articles of Incorporation. The financial statements have been prepared on a historical cost basis and are presented on the basis that the Company will continue as a going concern.

3 Significant investmentsAs at 31 December, 2012 and 31 December, 2011, Myriad Group AG held investments in the following companies:

NameShare capital

(million)Country of incorporation Function

Proportion of voting right held by the Company

in 2012

Proportion of voting right held by the Company

in 2011

Myriad Mobile Software Inc USD 0.1 USA Sales and Support 100% 100%

Myriad (China) Co. Ltd CNY 2.0 ChinaEngineering services, Sales and Support 100% 100%

Myriad Technology AG CHF 1.0 Switzerland Administrative 100% 100%

Myriad Group Korea Co. Ltd KRW 50.8 South KoreaEngineering services, Sales and Support 100% 100%

Myriad France SAS EUR 0.5 FranceEngineering services, Sales and Support 100% 100%

Myriad Japan Inc JPY 5.0 JapanEngineering services, Sales and Support 100% 100%

Myriad Group Australia Pty Ltd AUD 0.01 AustraliaEngineering services, Sales and Support 100% 100%

Myriad Software Solutions Private Ltd INR0.1 IndiaEngineering services, Sales and Support 100% 100%

MG Mobile Software Mexico, S. De R. L. De C. V. USD 0.02 Mexico

Engineering services, Sales and Support 99% 99%

Synchronica limited USD 37.4 UK Sales and Support 100% –

1 Myriad Group Australia Pty Ltd.’s share capital is AUD 100.2 MG Mobile Software Mexico S.De R. L. De C.V.’s share capital is USD 100. 1% is owned by Myriad France SAS.

On 7 March, 2012 the Board of Myriad announced the terms of its recommended increased share offer for the entire issued and to be issued share capital of Synchronica plc. Under the terms of the offer, Synchronica plc shareholders received 4.83 new Myriad shares for every 100 Synchronica shares.

On 16 April, 2012 Myriad announced that the recommended increased share offer for the entire issued and to be issued ordinary share capital of Synchronica plc (the “Offer”) had been declared unconditional in all respects. As of 16 April 2012 Myriad had received valid acceptances of the Offer totalling 80.68% of the issued share capital of Synchronica plc. This equated to 6,184,567 Myriad shares.

On 30 April, 2012 Myriad announced that it held or had agreed to acquire approximately 90.93% of the existing issued ordinary share capital of Synchronica plc and intended to exercise its rights pursuant to the provisions of sections 974 to 991 (inclusive) of the Companies Act 2006 to acquire compulsorily any outstanding Synchronica plc shares not acquired or agreed to be acquired pursuant to the Offer or otherwise.

Notes to the statutory financial statements


Notes to the statutory financial statementscontinued

3 Significant investments continuedOn 4 May, 2012 Myriad announced the despatch of formal compulsory acquisition notices, in the prescribed form under section 980(1) of the Companies Act 2006, to all Synchronica shareholders who had not to date accepted the Offer, giving notice of its intention to exercise its right under section 979 of the Companies Act 2006 to acquire compulsorily any remaining Synchronica shares in respect of which the Offer had not been accepted on the same terms as the Offer.

On 15 June, 2012 following the expiry of six weeks from the date of the compulsory acquisition notices, Myriad announced that it had received valid acceptances under the Offer in respect of 150,549,170 Synchronica plc shares, representing approximately 94.85% of the existing issued ordinary share capital of Synchronica plc. Synchronica plc shares held by those Synchronica plc shareholders who had not accepted the Offer were acquired compulsorily under the same terms of the Offer.

4 Disclosures related to the income statement4.1 General disclosures

CHF 2012 2011

Depreciation of furniture and equipment 100,751 10,739Amortisation of intangible assets 2,951,918 1,148,923Impairment of intangible assets 4,098,783 –Personnel expenses 1,121,525 1,207,544

4.2 Cost of revenueCost of revenue includes amortisation of intangible assets as follows:

CHF 2012 2011

Cost of licence revenue (2,413,303) (372,260)Cost of service revenue (14,186,096) (2,955,772)Amortisation of intangibles (4,809,513) (1,148,923)Impairment of intangibles (4,098,783) –

Cost of revenue (25,507,695) (4,476,955)

4.3 Sales and marketing costsIncluded within sales and marketing costs are the following amounts:

CHF 2012 2011

Sales and marketing costs (7,233,369) (2,175,373)Exclusivity fees (6,506,113) –Restructuring and integration costs (268,618) –

Total sales and marketing costs (14,008,100) (2,175,373)

4.4 General and administrative costsIncluded within general and administrative costs are the following amounts:

CHF 2012 2011

General and administrative costs (15,675,018) (7,184,413)Depreciation (100,751) (10,739)Restructuring and integration costs (102,000) (263,303)Doubtful debt expense (106,383) 97,662

Total general and administrative costs (15,984,152) (7,360,793)


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5 Share capitalAt 31 December, 2012 the share capital consisted of 61,133,660 (2011: 49,140,515) fully paid shares with a nominal value of CHF 0.10 each, of which 60,841,865 were recorded in the register of commerce.

The following table summarises the share capital:

CHF 2012 2011

Reconciliation of share capital – Share capital as per register of commerce 6,084,187 4,856,061– Paid in capital not yet registered (executed stock options and conversion rights) 29,179 57,991

Total share capital 6,113,366 4,914,052

Unissued authorised and conditional share capital – Unissued authorised share capital – –– Unissued conditional share capital 289,889 389,569

Total unissued authorised and conditional share capital 289,889 389,569

Shares issued through exercise of employee stock optionsDuring 2012, 291,975 employee stock options were exercised resulting in net proceeds to the company of CHF 28,075. During 2011, 579,904 employee stock options were exercised resulting in net proceeds to the Company of CHF 1,076,367. Any capital increase is recorded in the register of commerce in the year following issue, but is recorded in the accounts in the year in which the employee stock options were exercised.

Shares issued in connection with business combinationsIn April 2012 the Company increased its share capital out of the authorised share capital by 7,665,552 shares in connection with the acquisition of Synchronica plc.

Shares issued through a rights issueIn September 2012, a rights issue of 1 share for every 14 shares in issue resulted in an increase in issued share capital of CHF 403,580.

Authorised share capitalAt 31 December, 2012, the authorised share capital is nil (2011: nil). At the Extraordinary General Meeting held on 23 February, 2012, shareholders approved the creation of authorised share capital in the amount of CHF 1,170,135, consisting of 11,701,350 registered shares with a nominal value of CHF 0.10 each.

Conditional share capitalOf the conditional capital of CHF 289,889.10 (2,898,891 shares of CHF 0.10 each) as at 31 December, 2012 (2011: CHF 389,568.80, 3,895,688 shares of CHF 0.10 each), CHF 289,889.10 (2011: CHF 319,068.60) is reserved for the exercise of stock option rights which may be granted to members of the Board of Directors (‘Board’), employees of the Group as well as members of an Advisory Board (not established) under Group stock option plan(s) as approved by the Board. The subscription rights of the shareholders with respect to these shares are excluded.

Conditional capital of CHF 70,500.20 held at the 31 December, 2010, reserved for the exercise of conversion rights which were granted to investors in Myriad’s convertible bonds, expired on the 30 September, 2011. The conditional capital relating to these Convertible Notes therefore expired. The Board of Directors deleted the relevant article 3b of the Articles of Incorporation on 23 February, 2012.

4.5 Other income and expense

CHF 2012 2011

Other income: Other income 176,279 340,193Proceeds from legal settlement with Openwave Systems Inc – 4,839,000Intercompany loan provisions released 1,268,821 1,908,231

Total other income 1,445,100 7,087,424

Other expenses: Other expenses (1,693) (25,197)Impairment of Investment in Eflow Inc. (464,469) –Legal fees incurred by Openwave settlement – (464,022)

Total other expenses (466,162) (489,219)



5 Share capital continuedTreasury sharesIn 2012 and 2011 no transactions with treasury shares took place. At 31 December, 2012 the balance contains 20 (2011: 20) shares with a nominal value of CHF 0.10 each.

Significant shareholdersAt 31 December the significant (>3%) shareholders of the Company were as follows:

Percentage of shares held

as of 31 December

Name of shareholder 2012 2011

Balfidor Fondsleitung AG, Basel, Switzerland 2.18% 3.10%Sagem Telecommunications SA, Paris, France 5.09% 6.38%Patinex AG, Wilen, Switzerland 21.99% 15.74%UBS Fund Management, Basel, Switzerland 4.37% 5.56%Simon Wilkinson (CEO) 0.64% 3.01%

6 Other disclosures related to the balance sheet and commitments

CHF 2012 2011

Fire insurance value of furniture and equipment 50,000 262,893

7 CompensationCompensation paid to the members of the Board of Directors in 2012:

CHF Cash


options grantedFair value of stock

options granted

Total compensation

2012

Loek van den Boog Ex Chairman of the Board, Member AC, Head of AC1

55,000 30,000 5,216 60,216

Erik Hansen Chairman, Head of CNC2 196,833 33,333 41,333 238,166David Arnott Board Member, Head AC, Member CNC 35,000 – – 35,000Richard Schlauri Board Member, Member AC, Member CNC 23,333 – – 23,333Simon Wilkinson Board Member, CEO3 – 36,799 – –

Total 310,166 100,132 46,549 356,715


2 Erik Hansen was elected Vice Chairman of the Board on 23 February, 2012. Effective 23 February, 2012 he became Head of the CNC replacing Loek van den Boog.3 Simon Wilkinson’s remuneration is disclosed under the Key Management compensation note below.



CHF Annual salary Bonus1

Options(at fair value)2

Total 2012


2,161,448 92,797 485,475 2,739,720

Simon Wilkinson, Former CEO 271,850 – 41,742 313,592Gordon Tsang (highest individual compensation) 403,011 92,797 146,076 641,884

1 Bonus remuneration disclosed in 2012 relates to amounts paid or payable in respect of 2012 performance made to members of Key Management who left during 2 The share options awarded in 2012 are awarded under the Senior Management Performance and Retention Scheme. The charge noted above is the charge for 2012

based on the fair value of options.


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CHF Social


BenefitsTotal2012


297,523 53,388 19,969 370,880

Simon Wilkinson, Former CEO 85,261 – 3,971 89,232Gordon Tsang (highest individual compensation) – 23,704 – 23,704

Compensation paid to the members of the Board of Directors in 2011:

CHF Cash


options grantedFair value of stock

options granted

Total compensation

2011

Loek van den Boog Chairman of the Board, Member AC, Head of AC1 110,000 – 34,328 144,328

Michel Paulin Board Member2 49,000 – – 49,000Hans-Ulrich Müller Board Member3 – – – –Michel Bon Board Member4 – – – –Simon Wilkinson Board Member, CEO5 – – – –

Total 159,000 – 34,328 193,328


2 Michel Paulin resigned as Head of the AC and Board member on 18 October, 2011.3 Hans-Ulrich Müller resigned as Vice Chairman and Board member on 19 May, 2011.4 Michel Bon resigned as a Board member on 13 April, 2011.5 Simon Wilkinson’s remuneration is disclosed under the Key Management compensation note below.



CHF Annual salary Bonus1

Options(at fair value)2

Total 2011

Key Managementof whom 2,357,784 120,446 1,924,975 4,403,205Simon Wilkinson, CEO (highest individual compensation) 354,303 – 402,580 756,883

1 Bonus remuneration disclosed in 2011 relates to amounts paid or payable in respect of 2011 performance made to members of Key Management who left during the year.

2 The share options awarded in 2011 are awarded under the Senior Management Performance and Retention Scheme. The charge noted above is the charge for 2011 based on the fair value of options.


CHF Social


BenefitsTotal2011

Key Managementof whom 318,784 16,602 16,447 351,833Simon Wilkinson, CEO (highest individual compensation) 101,546 – 1,232 102,778


7 Compensation continuedShareholdings of members of the Board of Directors, Key Management or persons related to them as at 31 December:

2012 2011

Number of

sharesNumber of

options3

Number of shares

Number of options

Loek van den Boog Resigned 2012 – – 75,913 50,000Michel Paulin Resigned 2011 – – – 26,116Erik Hansen1 Chairman of the Board, Head CNC – 33,333 – –David Arnott2 Board Member, Head AC, Member CNC – – – –Richard Schlauri2 Board Member, Member AC, Member CNC – – – –Simon Wilkinson Resigned 2012 391,502 87,500 1,032,662 427,500James Bodha Chief Financial Officer – 395,215 – 658,033Stephen Dunford Chief Executive Officer – – – –Mike Grant Chief Marketing Officer – 50,000 – –Kim Hartlev Chief Technology Officer – 30,000 – –Ed Zylka SVP Device Solutions Division – 50,000 – 50,000Benoit Schillings Resigned 2011 – – – 159,718Malcolm Dawe Resigned 2011 – – – 177,220Gary Bunney Resigned 2012 – 51,113 – 127,000Mike Brady Resigned 2012 – 38,335 – 123,000Gordon Tsang Resigned 2012 – 18,750 – 50,875James Robins Resigned 2012 – 41,891 – 78,660Liz Hitchen Resigned 2013 – 73,500 – 87,362

1 Erik Hansen was awarded a further 30,000 share options in January, 2013 as part of his compensation package.2 In January, 2013 David Arnott and Richard Schlauri were each awarded 30,000 share options relating to their appointment as board members and a further 10,000

share options as part of their executive compensation package.3 The movement in share options between 2011 and 2012 includes 1,088,648 of surrendered share options.

Related party transactions

Related parties are members of the Executive Management Team, the Board of Directors and close family members of the aforementioned parties, and shareholders holding in excess of 20% of the share capital, as well as entities under these parties’ control.

Apart from the compensation paid to the Board of Directors and Key Management and the regular contributions to the various pension fund institutions and the related party transaction as disclosed above, there were no further transactions with related parties during the years ended 31 December, 2012 and 31 December, 2011. Sofinnova Partners, who held in excess of 20% of the share capital during 2010, are signatories to the Sagem Wireless settlement agreement referred to in note 10 to the consolidated financial statements.

8 Risk managementEnterprise risk management as a fully integrated risk management process was applied systematically in 2012 and 2011. Myriad’s risk analysis is prepared by the Corporate Management and gives an overview of the main risks of the Company, their significance, measures, time planning and responsibilities.

Measures in order to reduce risk exposures were defined and are in line with Myriad’s strategic targets. Risk analysis, measures and process of execution are discussed twice a year (at half-year Board Meetings).

9 Events after the reporting periodIn January and February, 2013 the Group secured short term loans with a total value of CHF 5,200,000 (USD 5,650,000) repayable on 31 December, 2013, and a letter of financial support for amounts up to USD 8,000,000 for the period up to 31 March, 2014.



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Report of the statutory auditor on the financial statementsAs statutory auditor, we have audited the financial statements of Myriad Group AG, which comprise the income statement, balance sheet and notes (pages 72 to 80), for the year ended 31 December, 2012.

Board of Directors’ responsibilityThe Board of Directors is responsible for the preparation of the financial statements in accordance with the requirements of Swiss law and the Company’s articles of incorporation. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error. The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation of the financial statements 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 entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the financial statements for the year ended 31 December, 2012 comply with Swiss law and the Company’s articles of incorporation.

Report on other legal requirementsWe confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence.

In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists which has been designed for the preparation of financial statements according to the instructions of the Board of Directors.

We recommend that the financial statements submitted to you be approved.

PricewaterhouseCoopers Ltd

Martin Kennard Stefanie BoehmAudit expert Audit expertAuditor in charge

Zurich, 12 March, 2013

Report of the statutory auditor to the generalmeeting of Myriad Group AG, Zurich


Share price dataSymbol: MYRNListing: SIXNominal value: CHF 0.10ISIN: CH0019624805Swiss Security Number (Valor): 1,962,480

2012 2011 2010

Number of shares at year end 61,133,660 49,140,515 48,560,611

Year high CHF 4.55 CHF 5.15 CHF 5.35

Year low CHF 2.03 CHF 2.73 CHF 2.95

Year end CHF 2.40 CHF 3.80 CHF 5.00

Average daily trading volume (shares) 124,237 96,455 92,804

Loss per share USD (1.05) USD (0.33) USD (0.69)

Market capitalisation at year end CHF 146.7 million CHF 186.7 million CHF 242.8 million

Financial calendar29 April, 2013: Annual General MeetingSeptember, 2013: Half Year Results 2013

http://www.myriadgroup.com/Investors/Investor-Calendar.aspx

Contact informationJames BodhaChief Financial OfficerMyriad Group AGCare of GHR Rechtsanwälte AGBahnhofstrasse 648021 Zurich, SwitzerlandPhone +41 44 823 89 00Fax +41 44 823 89 99

Any queries please contact the Investor Relations [email protected]

Myriad Group AGCare of GHR Rechtsanwälte AGBahnhofstrasse 648021 ZurichSWITZERLAND

t: +41 (0) 44 823 89 00e: [email protected]

Myriad and certain other trade names, trademarks and logos are trademarks or registered trademarks of Myriad Group AG. All other trademarks, logos or source marks are the property of their respective owners. All rights reserved. Copyright © Myriad Group AG 2011. CD15505 02/11

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Notes


Notes

FSC LOGO TO GO HERE

Myriad and certain other trade names, trademarks and logos are trademarks or registered trademarks of Myriad Group AG. All other trademarks, logos or source marks are the property of their respective owners. All rights reserved. Copyright © Myriad Group AG 2012. CD15505 02/11

Myriad Group AGCare of GHR Rechtsanwälte AG Zürich: Bahnhofstrasse 64 P.O. Box 3268 CH - 8021 Zürich

t: +41 (0)58 356 5000 f: +41 (0)58 356 5009e: [email protected]

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