MIND Technology, Inc. Annual Report 2019

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FY2019 Annual Report · MIND Technology, Inc.

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Mirriad Advertising plc
Annual report and accounts 2019

Highlights

Contents

Net asset
2018: £15.6m

£19.2m
£1,140k
8p

Revenue
2018: £416k

Loss per share
2018: 14p

Revenue
£000

EPS
p

Net assets
£m

k
0
4
1
1

p
9
1

p
4
1

m
9
7
2

m
2
9
1

m
6
5
1

p
8

k
4
7
8

k
6
1
4

Strategy

• Successful fundraise of £16.2 million (gross)

• New go-to-market strategy

• Redeployment of resources into product, technology and sales

• New geographic focus on the USA, China, UK,

France and Germany

• Withdrawal from Brazilian and Indian markets

Strategic report
IFC Highlights

1 A solution for a new era

16 Business model

18 Chairman’s statement

19 Chief Executive Officer’s statement

20 Our strategy and key performance indicators

22 Financial review

25 Managing our risks

28 Principal risks

30 Directors’ duties s172 statement

31 Environment and people

Corporate governance
34

Introduction to corporate governance

35 Board of Directors

38 Corporate governance statement

43 Audit Committee report

45 Remuneration Committee report

49 Directors’ report

50 Statement of Directors’ responsibilities

Financial statements
51

Independent auditors’ report

56 Consolidated statement of profit or loss

56 Consolidated statement
of comprehensive income

57 Consolidated and Company balance sheets

58 Consolidated statement of changes in equity

59 Company statement of changes in equity

60 Consolidated and Company statement

of cash flows

61 Notes to the consolidated
financial statements

86 Notice of Annual General Meeting

92 Company information

The Strategic Report contained on
pages 1 to 33 was approved by the
Board on 14 May 2020.

John Pearson
Non-executive Chairman

See our technology in
action in our showreel:
mirriadplc.com/showreel

A SOLUTION
FOR A NEW ERA

Mirriad’s award-winning solution represents one of the most significant
answers to the growing challenges in marketing and for the content and
media industries.

As viewers show growing signs of ad fatigue, marketers need new paths
to efficiency, differentiation and growth. Meanwhile the content industry is
looking for new sources of revenue to mitigate the pressure on their traditional
model and the increasing cost of content.

Mirriad’s platform creates new advertising inventory in the content itself,
unleashing new scalable revenue opportunities for content producers
and distributors. This contextually relevant inventory gives advertisers
a flexible way to engage with audiences when their attention is highest.
This exponentially increases audience reach and advertising impact.

Research consistently confirms that viewers prefer the Mirriad format
over traditional TV and video advertising, and experience it as truly realistic
and content enhancing.

This makes our format a new and superior option for viewers, marketers
and the content industry alike.

“ AI is digitally pasting
products into your
favorite films and TV.”

“ Supercharged version
of digital product
placement.”

“ Ultimately tailor product
placements to individual
viewers’ interests.”

Read more about
our culture.

Read more about Board
succession planning.

p 31 to 33

p 40

On behalf of the Board, I am pleased to present our Corporate
Governance Statement for the year ended 31 December 2019.

This is our second year of full compliance with the Quoted
Companies Alliance Corporate Governance Code (the “QCA
Code”) and we have continued to work on the application of
specific parts of the Code and have also reviewed with interest
the AIM Good Governance Review published by the QCA. A key
part of my role is to ensure that the Company operates to the
highest standards of governance and that we instil a sound
attitude to governance throughout the Group reacting to
changes and making recommendations to improve governance.
My Board colleagues and I continue to recognise the value
and importance of high standards of corporate governance.

During the year I assumed the role of Chairman replacing
Roger Faxon, who chose to retire after a long association with the
Company. We also welcomed Bob Head as a new Non-executive
Director and also appointed Bob as Chair of our Audit and
Remuneration Committees. In my view, Bob’s expertise and
wide-ranging experience in disruptive businesses perfectly suit
this role and together with his track record of serving effectively
on remuneration, audit and risk committees, and his proven
ability to grow revenues whilst nurturing the long-term prospects
of businesses, will be invaluable going forward. Bob is a qualified
Chartered Accountant, originally training with Coopers & Lybrand,
where he was a senior manager, an Associate of the Chartered
Insurance Institute and a Fellow of the Institute of Bankers.
He has had a long, varied and successful career initially focused
on the impact of technology on financial services including
tenure at Prudential, where he was the joint founder of egg.com,
and the Co-operative Bank plc, where he was the first chief
executive of award-winning online bank smile.co.uk.

My role as Chairman
My role is to ensure that the Board operates effectively in
delivering the long-term success of the Company. In fulfilling
this role, I seek to ensure that Board meetings are conducted
to allow all Directors to have the opportunity to express their
views openly and that, in particular, the Non-executive Directors
are able to provide constructive support and challenge to the
Executive Leadership Team.

Culture and business ethics
I consider it critical that the Group establishes a culture in
which colleagues feel comfortable raising concerns and issues
as well as ideas and proposals that allow the business to innovate
and develop. I am really pleased that Stephan and I, along with the
wider Board and senior management, are in complete agreement
on the sort of culture we want to create across the business and
that we took a number of steps to enhance and develop the Group
culture during the year. These steps are set out in more detail in
the section on stakeholders and people earlier in this report.

Mirriad Advertising plc Annual report and accounts 2019

Board of Directors

EXPERIENCE AND INSIGHT

Composition of the Board

Board skills and experience

Directors’ tenure

100%

67%

50%

33%

Number of Directors with:

 Technology (all)

 Chair/CEO/CFO (John, Bob, Stephan, David)

 Financial (Bob, Alastair, David)

 Regulatory/risk (Bob, Alastair, David)

 Remuneration/HR (Bob, David)

Balance of the Board

67+

 Non-executive

 Executive

 0-1 years 1

 2-5 years 4

 1-2 years 1

17+
83+

Board members by nationality

 German 1

 British

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements17
+
66
+
U
33
+
U
17
+
U
Board of Directors continued

AN EXPERIENCED BOARD

John Pearson
Non-executive Chairman

Stephan Beringer
Chief Executive Officer

David Dorans
Chief Financial Officer

Experience
Joined the Board in October 2017. On 30 April 2019
John took up the role of Non-executive Chairman.
John has a long history in advertising and media
along with commercialisation and general business
development of rapidly growing companies. He brings
plc board experience to the Company. John’s role
is to run the Board, ensure the correct corporate
governance is in place, challenge the strategy
proposed by executive management and take
into account the views of wider stakeholders.

Prior expertise
Former Chief Executive Officer of Virgin Radio
and Virgin Radio International, director of Ginger
Media, chairman of Shazam, co-founder of World
Architecture News.com and food.com.

Sector experience
Advertising, marketing, technology, digital,
corporate governance and M&A.

External appointments
Chairman of Equals Group plc, chairman
of Imagen Video Asset Management Ltd
and director of Classic Racing EGTS Ltd.

Experience
Joined the Board in September 2018 to take
on the role of Chief Executive Officer following
a long career in the advertising industry where
he covered a breadth of roles from creative to
strategy to technology to data. Stephan has been
tasked with renewing the Company’s strategy and
the way it operates to ensure that the Company
is on a path to growth.

Prior expertise
President of data, technology and innovation at
Publicis. Chief Executive Officer of VivaKi, driving
the transformation of Publicis’ programmatic buying
and servicing model. He has worked with some
of the world’s biggest brands including McDonald’s,
Audi, Nissan, Asus, P&G and Michelin, and led
key technology partnerships and initiatives with
companies such as Adobe, Microsoft and Google.

Chief growth and strategy officer for the
digital technologies division of Publicis Groupe,
international Chief Executive Officer for Digitas
and Razorfish, and global chief strategic officer
and president of Tribal DDB EMEA.

Sector experience
Advertising, media and digital agencies,
technology, business strategy and M&A.

External appointments
None.

Experience
Joined the Board in December 2017 following a
career in the broadcasting and technology sector
where his roles have included financial leadership
and operational roles. David’s task is to manage
the financial and risk aspects of the Company as
well as leading the human resources function.

Prior expertise
Chief financial officer at Mindshare UK, chief
financial officer of YouView, head of distribution
and broadcast technology at Channel 4 and
general manager of UKTV. David is a fellow of
the Institute of Chartered Accountants in England
& Wales having qualified with Coopers & Lybrand
(now PwC).

Sector experience
Financial management, corporate governance,
technology, media, advertising and HR.

External appointments
None.

Mirriad Advertising plc Annual report and accounts 2019

Key

Audit Committee member

Remuneration Committee member

Committee Chair

Independent

RA4

A R

Bob Head
Non-executive Director

Experience
Joined the Board in June 2019.

Prior expertise
A qualified Chartered Accountant, an Associate
of the Chartered Insurance Institute and a Fellow
of the Institute of Bankers. Bob has had a long
career in financial services including tenure at
Prudential (where he co-founded egg plc, the first
UK internet bank) and the Co-operative Bank plc
(where he was the first Chief Executive Officer
of smile.co.uk) and nine years spent in various
senior roles with Old Mutual. He has also spent
time in South Africa where he was a member
of the Executive Committee of the South African
Revenue Service and interim chief financial officer
at South African Airways.

Sector experience
Financial management, risk management,
technology, corporate governance and HR.

External appointments
Non-executive director of Equals Group plc,
Personal Group plc and Alexander Forbes
Group Limited.

Dr Mark Reilly
Non-executive Director

Alastair Kilgour
Non-executive Director

Experience
Joined the Board in December 2017 having
been the representative of IP2IPO prior to that.
Mark heads the technology division of IP Group plc,
one of the UK’s leading intellectual property
commercialisation specialists. He has extensive
experience in the information and communications
technology sector, working with a broad spectrum
of organisations from blue-chip multinationals and
NGOs to early-stage start-ups.

Prior expertise
Prior to joining IP Group, Mark was the founder
and managing director of Remarkable Innovation,
a successful Singapore-based technical due
diligence company with a range of international
Fortune 500 and national government clients.
Mark holds a PhD in Engineering from the
University of Cambridge, UK.

Sector experience
Technology, venture capital, commercialisation
of IP, funding and strategy.

External appointments
None.

Experience
Joined the Board in December 2017 having
been the representative of Parkwalk Advisors
prior to that. Alastair has significant venture capital
experience and adds expertise on fundraising and
shareholder management to the Board.

Prior expertise
Possessing a depth of experience in the
investment and fund management community,
before founding Parkwalk Advisors Alastair was
a partner of Lazard LLP, a director of BNP and
a founder partner of Ark Securities.

Sector experience
Venture capital, banking, funding strategy
and M&A.

External appointments
Chief investment officer at Parkwalk Advisors
Limited, director of PredictImmune Limited,
Congenica Limited, PetMedix Limited, Phoremost
Limited, Albert Innovations Limited and Victoria
Innovations Limited.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsCorporate governance statement

Board effectiveness
Having adopted the QCA Code for reporting in 2018 the
Directors remain committed to ensuring that the Company
fully complies with the requirements of the QCA Code and
to maintaining high standards of corporate governance.

these options and shareholdings, the Board is satisfied that both
John Pearson and Bob Head are independent in character and
judgement, and that there are no relationships or circumstances
that would materially affect or interfere with the exercise of their
independent judgement including the options and shares held.

The Board continued to monitor its own effectiveness during
2019 and the Company Secretary carried out a Board effectiveness
survey of Directors towards the end of 2019. The results of this
survey are summarised below and were discussed by the Board
in December to agree actions to be taken in 2020.

Board composition and responsibilities
The Board’s primary role is to focus on building shareholder
value by identifying and assessing business opportunities
balanced against the associated risks.

The Group is controlled by a Board of Directors, which as at
31 December 2019 comprised a Non-executive Chairman, three
other Non-executive Directors and two Executive Directors.
The Board considers two of its members to be independent.

The Chairman is John Pearson and the Chief Executive Officer
is Stephan Beringer.

The overriding responsibility of the Board is to provide clear,
entrepreneurial and responsible leadership to the Group within
a framework of efficient and effective controls so as to allow
the key risks and issues facing the business to be assessed and
managed. The Board operates both formally, through Board and
Committee meetings, and informally, through regular contact
between the Directors and senior executives. There is a schedule
of matters specifically reserved to the Board, including approval
of interim and annual financial results, setting and monitoring of
strategy and examining business expansion possibilities. The Board
is supplied with sufficient information in a timely manner, in a
form and quality appropriate to enable it to discharge its duties.
The Directors can obtain independent professional advice at the
Group’s expense in the performance of their duties as Directors.

Senior executives below Board level attend Board meetings
when appropriate to present business updates.

Board meetings are normally held at the Company’s head office
in London which allows the Non-executive Directors to interact
with Company staff. The Non-executive Directors are also able
to visit the Group’s other offices to gain a greater understanding
of the Group’s activities.

The roles of Chairman and Chief Executive are separate,
and there is a clear division of responsibility at the head of the
Group. The Chairman is responsible for running the business of
the Board and for ensuring appropriate strategic focus and direction.
The Chief Executive Officer is responsible for proposing business
strategy and plans to the Board, implementing them once approved
and overseeing the management of the Group with the Group’s
other senior executives.

Board independence, appointment and re-election
The Board considers both the Chairman and Bob Head,
a Non-executive Director, to be independent.

The Chairman currently holds a package of options to purchase
shares in the Company and the Company granted Bob Head
a package of options following the year end. Notwithstanding

All Directors hold shares in the Company following the recent
fundraise in which they all participated. The Directors’ interests
in shares and options of the Company are shown in the
Remuneration Committee Report (options) and the Directors’
Report (shares). The Board feels that it is important that, as the
Company is a high risk investment, the Directors are aligned
with the interests of shareholders and believes that this is
best achieved by being personally invested in the Company.

The Board has reviewed its composition and currently remains
satisfied with it, including the balance between Executive and
Non-executive Directors. The Board believes that the current
composition allows it to exercise objectivity in decision making
and properly control the Group’s business activities and risks.

The Board is committed to diversity and inclusion and when
Board vacancies arise, the Board will seek to identify candidates
from a diverse range of backgrounds to be considered for any
such appointment.

The Board notes the recommendations in the QCA Code that
a company should have at least two independent non-executive
directors and should not be dominated by one person or a group
of people. The Board believes it meets this recommendation, except
in respect to the holding of Ordinary Shares in the Company by the
Directors. As Dr Mark Reilly and Alastair Kilgour joined the Board
in a personal capacity at the time of the IPO, having previously
been the nominated representatives of the corporate Directors
IP Group plc and Parkwalk Advisors Limited, respectively, they
are not regarded as independent but bring significant skills to the
Board as set out on page 38.

Each of the Directors is subject to retirement by rotation
and re-election in accordance with the articles of association
of the Company. All Directors appointed by the Board are subject
to election by shareholders at the first Annual General Meeting
after their appointment and generally serve terms of three years.
Stephan Beringer was appointed and John Pearson and David Dorans
were re-appointed at the last Annual General Meeting. As Bob Head
was appointed as a Director by the Board on 13 June 2019 after
the last Annual General Meeting, he is offering himself for election
at the forthcoming Annual General Meeting. Mark Reilly and
Alastair Kilgour will also offer themselves up for re-election at
the forthcoming Annual General Meeting of the Company.

Conflicts of interest
In accordance with an established procedure, all Directors are
required to notify the Board of any conflicts of interest at the
start of each Board meeting. This is formally recorded in the
minutes by the Company Secretary, and any Director disclosing
a conflict is required to excuse themselves from the matter on
which they have a conflict. Any planned changes to their interests,
including directorships outside the Group, are officially disclosed
to the Board. There were no relationships declared in 2019 that
were considered to conflict with the Company’s business and
therefore there was nothing that was deemed to affect the
independence of the Directors.

Mirriad Advertising plc Annual report and accounts 2019

BOARD AND
COMMITTEE MEETINGS

The Board normally meets monthly with an aim to meet a minimum of 10 times
per year for formal Board meetings. It also arranges ad hoc meetings to consider
strategic issues and approve key operational decisions as required.

The Executive Directors are responsible for carrying out decisions reached by the
Board and, where appropriate, communicating the decisions of the Board and any
necessary actions to be taken to the employees of the Company through the
appropriate line management channels.

The Directors are expected to attend all meetings and receive appropriate and
timely information from the Executive Directors ahead of each Board meeting.

Meeting attendance
Number of meetings and attendance while in post

Board

5/6 1

11/11

5/5 2

Audit
Committee

Remuneration
Committee

2/2 1

—

3/3 4

3/3

—

1/1 2

—

4/73

—

7/7

5/5 2

Member

Roger Faxon

John Pearson

Stephan Beringer

David Dorans

Dr Mark Reilly

Alastair Kilgour

Bob Head

1 Resigned 4 June 2019.

2 Appointed 13 June 2019.

3 Chair of Remuneration Committee until 30 April 2019 and then
has a standing invitation to attend meetings but is not formally
a Committee member.

4 By invitation of Committee Chair.

Development, information and support
The Directors have unrestricted access to the Group’s
management and advisers. When new Directors are appointed,
they receive an induction facilitated by the Chief Financial Officer.
This induction includes meetings with key members of management
and briefings on the Group’s business, its industry and public
company duties generally. Directors are able to visit the Group’s
operations overseas on request. The Directors have continuous
access to the knowledge and expertise of senior management,
are free to meet with them at any time and can attend executive
management strategy and planning sessions. Directors are also
able to get external advice at the expense of the Company
should they feel this is necessary.

The Directors have a wide variety of expertise drawn from different
industries and business functions. This diversity adds value to the
Board as the Directors can draw on their deep and wide range
of experiences in other international businesses and publicly listed
companies. This means that, collectively, the Directors are able to
bring significant expertise to the table, enabling them to make high
quality, diverse and relevant contributions to Board discussions.

This enriches debate and allows carefully considered judgements
to be reached, consensus to be arrived at, and informed decisions
then taken. The Non-executive Directors provide both support
and constructive challenge to senior management when reviewing
proposals. They then monitor performance against agreed strategy
and plans over both the short and longer term.

All Non-executive Directors are appointed for an initial term
of three years subject to satisfactory performance. Their contracts
can be renewed for additional three-year terms following review
by the Board and approval by shareholders at the next Annual
General Meeting. All Non-executive Directors are expected to
devote as much time as necessary for the proper performance
of their duties, which is anticipated to be a minimum of two days
per month on work for the Company for most Non-executive
Directors and approximately eight days per month for the Chairman.
Directors are expected to attend all Board meetings and meetings
of Committees of which they are members and any additional
meetings as required.

Notwithstanding the ability to commission external advice,
neither the Board nor any of its Committees felt it necessary
to commission any specific external advice during the year.
The Board and Committees do place reliance on external advice
commissioned directly by the Company and have direct access to
it and the Company’s advisers including the Company’s NOMAD
who is available to all Directors to provide regulatory and other
guidance. Specific advice has been received during the year on
fundraising activities and long-term incentives. Specific training
was also given to all Directors by the Company’s new NOMAD,
Canaccord Genuity, to remind Directors of their duties.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsCorporate governance statement continued

Succession planning
The Board continues to review its composition and has
debated it during 2019 as there were a number of Director
changes. During 2019 the Board addressed some of the
issues noted in the Company’s 2018 Annual Report with the
appointment of Bob Head who chairs the Company’s Audit and
Remuneration Committees. The expertise he brings from other
public companies, in financial management, risk management,
corporate governance and HR generally, has added greatly to
the skills of the Board as a whole.

The Board currently considers its composition to be appropriate
in view of the size and requirements of the Group’s business and
the need to maintain a practical balance between Executives and
Non-executives.

The whole Board acts as the Company’s Nomination Committee.
The appointment of any new Non-executive Directors is therefore
subject to discussion and ratification by the full Board. All Board
members were involved in the selection process for the appointment
of Bob Head. The Company will continue to monitor whether it
would be useful and helpful to create a separate and differently
constituted Nomination Committee.

Board Committees
The Board has two Committees: the Audit Committee and the
Remuneration Committee.

Audit Committee
The Audit Committee has two Non-executive Director members:
Bob Head (Chairman) and Mark Reilly. The Group’s external
auditors and the Chief Financial Officer are invited to attend
Audit Committee meetings.

The Audit Committee has responsibility for, among other things,
monitoring of the financial integrity of the financial statements
of the Group and the involvement of the Group’s auditors in that
process. It focuses on compliance with accounting policies and
ensuring that an effective system of audit and financial control
is maintained, including considering the scope of the annual audit,
the extent of the non-audit work undertaken by the external
auditors and advising on the appointment of the external auditors.
The ultimate responsibility for reviewing and approving the
Annual Report and Accounts and the half-yearly reports remains
with the Board.

The Audit Committee meets at appropriate times in the financial
reporting and audit cycle, and at least twice a year. The terms of
reference set out the authority of the Audit Committee to carry
out its responsibilities. The terms of reference also cover issues
such as membership and the frequency of meetings, together with
requirements of any quorum for, and the right to attend, meetings.

Any non-audit services that are to be provided by the external
auditors are reviewed in order to safeguard auditor objectivity
and independence.

The external auditors have the opportunity during Audit Committee
meetings to meet privately with Committee members in the absence
of executive management.

The Group updated its full risk register during 2019, with the most
recent register being compiled in Q4 2019. This register was
presented for consideration, review and amendment at the Audit
Committee. Not all risks can be fully mitigated. The approach is
very much one to optimise the net risk. Following approval, the
risk register was recommended to and adopted by the full Board.
In addition, the register was shared with the auditors and a
discussion was held about how this influenced the audit strategy.

Board evaluation
Following the adoption of the QCA Code, the Board
undertook the first evaluation of its own performance
led by the Chairman and Company Secretary at the end
of 2018. This was relatively soon after Stephan Beringer’s
appointment as Chief Executive Officer and the Board agreed
to carry out a further evaluation in 2019. This evaluation
was, like the evaluation in 2018, carried out using a
questionnaire sent to all Directors, which was returned
confidentially to the Company Secretary, who collated the
findings. The full results of the evaluation, including verbatim
comments from the Directors, were discussed at the Board
meeting in December 2019.

There was positive feedback from Directors
on the following areas from the evaluation:

1. There is a clear vision, priorities and values

2. They have assurance that vision and strategic

priorities are being implemented

3. There is a clear corporate governance structure

4. There is strong leadership from the Chairman

and Chief Executive Officer

5. They gave positive feedback on

the effectiveness of the Audit and
Remuneration Committees

6. The Non-executive Directors gave positive
feedback on the Chief Executive Officer
and senior management team

7. Directors felt that there was improved
dialogue within the Board during 2019

8. Directors felt that there was healthy

debate at Board meetings with appropriate
challenge by Non-executive Directors to
Executive Directors

Mirriad Advertising plc Annual report and accounts 2019

During 2019, the Audit Committee reviewed and debated
the report of the Company’s external auditors and requested
appropriate follow-up by the Chief Financial Officer. The Committee
also reviewed the terms of appointment of the external auditors
and their proposed audit approach for the 2019 audit (undertaken
in 2020).

At each meeting the Audit Committee reviews the progress to
clear items noted by the auditors in their management letters.

During 2019, the Remuneration Committee met to agree
and sign off the incentive payments recommended by executive
management for the Company, agree and approve base salary
changes, agree and approve share option/long-term incentive
scheme awards, and review and approve new packages prior to offer
for other senior staff appointments (senior staff are defined as those
with starting salaries of more than £100,000). In addition, the bonus
criteria for staff have been agreed for the following financial year.

The Committee has discussed the risk management model.
At this stage of development the Committee considers the
three lines of defence model premature. However, this will
be kept under review.

Remuneration Committee
Membership of the Company’s Remuneration Committee changed
twice over the course of 2019 as the Non-executive Director
positions changed. Currently the Remuneration Committee is
composed of three Non-executive Director members.

Following his appointment in June 2019 the chairmanship was
taken up by Bob Head and the other two Committee members
are Alastair Kilgour and Mark Reilly.

John Pearson was the Chair of the Committee until he took up the
chairmanship of the Company on 30 April 2019. Between that date
and the appointment of Bob Head, Alastair Kilgour assumed the
chairmanship of the Committee and the membership reduced to
two Non-executive Directors.

The Company Chairman has a standing right to attend any
Remuneration Committee meetings. The Committee meets
periodically formally and informally as required and is responsible
for overseeing the policy regarding staff and senior executive
remuneration and for approving the remuneration packages
for the Group’s Executive Directors. It is also responsible for
reviewing incentive schemes for the Group as a whole.

Nomination Committee
The Nomination Committee is made up of all Board members
as, due to the size and state of development of the Company,
the Directors do not consider it necessary to set up a separate
Nomination Committee. Therefore, new appointments are
considered by the Board as a whole.

Risk management and internal controls
The Directors are responsible for the Group’s system of internal
control and for reviewing its effectiveness; the role of management
is to implement Board policies on risk management and control.
The Group’s system of internal control is designed to manage, rather
than eliminate, the risk of failure to achieve the Group’s business
objectives and can only provide reasonable, and not absolute,
assurance against material misstatement or loss. The Group operates
a series of controls to meet its needs. These controls include, but
are not limited to, a clearly defined organisational structure, written
policies, a comprehensive annual strategic planning and budgeting
process, and detailed monthly reporting. The Group prepares
quarterly forecasts, which are reviewed and approved by the Board
as part of its normal responsibilities. The quarterly forecasting
process facilitates the Board’s understanding of the Group’s
overall position throughout the year. The Audit Committee
receives reports from management and the external auditors
concerning the system of internal control and any material
control weaknesses.

In terms of areas for further consideration
during 2020 the following were highlighted
in the evaluation:

1. To formally agenda reports from the Company’s

Remuneration and Audit Committees at
Board meetings

2. To hold a separate Board strategy day during 2020

3. To consider additional opportunities for

Non-executive Directors to engage more widely
with staff outside of the senior management team

4. To re-evaluate risk appetite as a whole Board

during 2020

5. The potential to create a more formal process

for appointment of new Directors in the future
to take into account additional skills required on
the Board, induction process and consideration
of diversity

Discover more about
our Audit Committee
Report.

p43 and 44

Discover more about
our Remuneration
Committee Report.

p45 to 48

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsCorporate governance statement continued

Shareholder engagement
The Company appointed Charlotte Street Partners
as financial PR advisers in May 2019 as part of the
strategic reset. The Company’s new strategy was
presented to analysts and shareholders via a live webinar
on 29 March 2019. This was followed by presentations
to a range of existing and prospective shareholders
during the Company’s financial roadshow in July 2019.
A second webinar was held on 12 September 2019 to
walk through business progress and present the
Company’s interim financial results.

The Company released its first shareholder newsletter
on 17 December 2019 to give further high level
information about business progress and invited
shareholders and other interested stakeholders to sign
up to its investor database and receive future business

updates on a regular basis. The Company also hosted
a technology showcase event for shareholders and
analysts on 16 January 2020 where more details of the
technology underlying the Company’s business and the
future development path for that technology were
presented and demonstrated.

“ We have refreshed
and reinvigorated our
shareholder engagement
over the course of 2019.”

Risk management and internal controls continued
During 2019, the Company maintained and reviewed its
comprehensive risk register with input from all areas of the Group.
This was reviewed and discussed by the Audit Committee and
ultimately adopted by the full Board. It was agreed that this risk
register will be updated quarterly and presented to the Audit
Committee. Any significant risk issues will be referred to the
Board for consideration. The Board has considered the need for
an internal audit function, but has concluded that, at this stage
in the Group’s development, the internal control systems in
place are appropriate for the size and complexity of the Group.

The Board has continued to review the system of internal
controls periodically and has not identified, nor been informed
of, any instances of control failings or significant weakness.

Relationship with significant shareholders
and wider stakeholders
The Chairman, Chief Executive Officer and Chief Financial
Officer are responsible for handling relationships with investors
and analysts and regularly meet with institutional shareholders
to foster a mutual understanding of objectives. The Company
began a process of reinvigorating its investor relations activities
following the appointment of Stephan Beringer in Q4 2018 and
the appointment of John Pearson as Chairman in April 2019.
Since then the Company has taken the following steps:

• It appointed Charlotte Street Partners as financial PR advisers

in May 2019

• It presented its new strategy to analysts and shareholders

via a live webinar on 29 March 2019

• It gave a series of presentations to a range of existing and
prospective shareholders during the Company’s financial
roadshow in July 2019

• It held a second webinar on 12 September 2019 to walk
through business progress and present the Company’s
interim financial results

Mirriad Advertising plc Annual report and accounts 2019

• It released its first shareholder newsletter on 17 December 2019
to give further high level information about business progress
and invited shareholders and other interested stakeholders to
sign up to its investor database and receive future business
updates on a regular basis

• It hosted a technology showcase event were shareholders

and analysts on 16 January 2020 where more details of the
technology underlying the Company’s business and the future
development path for that technology were presented
and demonstrated

The Chairman and the other Non-executive Directors are
available to shareholders and other stakeholders to discuss
strategy and governance issues. The Directors encourage the
participation of all shareholders, including private investors, at
the Annual General Meeting. The Annual Report and Accounts
and the strategy update are published on the Company’s corporate
website, www.mirriadplc.com, and can be accessed there
by shareholders.

Open and transparent communication with our employees
around the world is a critical element in driving the Group’s
success. The senior management team is committed to a culture
that encourages all staff to contribute ideas and thoughts on
how the Group can innovate and drive business. To that end the
Group holds frequent videoconference Town Hall meetings that
all staff can access. Additionally, the Group runs a full employee
survey with results and actions shared following the analysis of
results. More details about this are covered in the earlier section
on people.

By order of the Board

John Pearson
Non-executive Chairman
14 May 2020

Audit Committee report

Bob Head
Chairman of the Audit Committee

Member

Bob Head (Chair from 13 June 2019)

Dr Mark Reilly (Chair until 13 June 2019)

Roger Faxon

Number of meetings
and attendance while
in post

1/1

3/3

2/2

I am pleased to present the report for the Audit Committee
for the year ended 31 December 2019.

I took over the chairmanship of the Committee following my
appointment as a Director on 13 June 2019. Prior to that the
Committee was chaired by Mark Reilly. Mark and I remain
the two Non-executive Director members of the Committee.
The Company’s Executive Directors attend meetings by invitation,
and senior management is asked to attend meetings when relevant.
The Committee meets a minimum of three times per year and at
least twice a year with the external auditors present.

The Committee’s responsibilities cover a range of areas.
In summary, the Committee is responsible for:

Monitoring the integrity of the Company’s financial
statements, including its annual and half-yearly reports,
ensuring that accounting policies have been fairly and
consistently applied; that estimates and judgements
used are reasonable; that, taken as whole, the Company’s
financial reports are clear and complete; and that all material
information presented with the financial statements,
such as the business review and the corporate governance
statements, are accurate.

Considering the need for an internal audit function
and reviewing the adequacy and effectiveness of the
internal control and risk management systems.

Considering and making recommendations to the Board
about the appointment, re-appointment and removal of the
Company’s external auditors and ensuring that at least once
every 10 years the audit services contract is put out to
tender; overseeing the relationship with the external auditors,
including making recommendations on their fees; approving
their terms of engagement, including the engagement letter
and the scope of the audit; assessing their independence
and objectivity, including the provision of any non-audit
services; meeting regularly with the external auditors,
including once at the planning stage before the audit and
once at the reporting stage after the audit, and at least
once a year, without management being present, to
discuss the auditors’ remit and any issues arising from
the audit; and reviewing the findings of the audit with
the external auditors.

The Committee has concluded that the Company is not yet at the
stage of development where an internal audit function would be
appropriate. It will continue to monitor this.

Internal controls and risk management
The Board has overall responsibility for the system of internal
controls and risk management. During the year the Company
continued to work with its risk reporting framework. The most
recent update to the risk register was made in Q4 2019 and
was presented to the Committee by the Chief Financial Officer.
As a relatively small company there is not the scope for the level
of internal control that larger organisations facilitate. Much of the
control environment relies on close supervision of subsidiary units
and strict control of cash resources from the central finance team
under the direction of the Chief Financial Officer. The Audit
Committee, on behalf of the Board, has again reviewed the
effectiveness of the internal controls and risk management.
The Committee received and considered the risk register from
executive management and debated risks with management.
The Committee also discussed the internal control framework
with the Company’s external auditors and risks relating to fraud
that the Group faces.

The Committee also received and considered reports from the
external auditors, PwC LLP, which included control findings
relevant to their audit.

There is an ongoing process to identify, evaluate and manage the
risks faced by the Group. Each business unit or function reports
quarterly on key risks identified and measures being taken to mitigate
or optimise those risks. These are summarised and reported to
the Committee by the Chief Financial Officer before being
passed to the full Board by the Committee.

The Strategic Report on pages 1 to 33 includes further details
about the business risks identified and actions being taken.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsExternal audit
The Committee considered a number of areas when reviewing
the external auditors’ appointment, specifically their performance
in undertaking the audit, the scope of the audit and terms
of engagement, their independence and objectivity, and their
re-appointment and remuneration.

The Committee reviews the objectivity and independence
of the auditors when considering re-appointment. The external
auditors report to the Committee on actions taken to comply
with professional and regulatory requirements. The Committee
is satisfied with the independence, objectivity and effectiveness
of PwC LLP and has recommended to the Board that the auditors
be re-appointed. There will be a resolution to this effect at the
forthcoming Annual General Meeting.

Bob Head
Non-executive Director
14 May 2020

Audit Committee report continued

Going concern review
The financial statements have been prepared on the going
concern basis. After making enquiries and producing cash flow
forecasts, the Directors have reasonable expectations, as at the
date of approving the financial statements, that the Company
and the Group have adequate resources to fund the Company
and the Group for the next 12 months. The Group’s cash holding
at 30 April 2020 was £15.81m and the Directors disclosed that
the Group’s cash burn continues to be not more than £1m per
month and is anticipated to gradually improve with increased
revenues. Revenues will increase in 2020 as a result of higher
contracted minimum guaranteed revenues. On the basis of
the Company’s internal forecasts the Directors believe that
the Company has sufficient cash resources to fund its activities
until the end of the third quarter 2021 at which point it may
require additional cash resources depending on the rate
of increase in revenue.

The Directors have also reviewed the potential impact of COVID-19
on the business and believe that, while there is significant
uncertainty about the longer-term impact of the virus on the
business, it does not change their going concern assessment.

The Committee is satisfied this is an appropriate basis of preparation
and appropriately disclosed in the financial statements.

Significant reporting issues and judgements
The Committee reviewed the following significant reporting
matters and areas where judgement had been applied during
the year:

• The capitalisation of development costs and intangible assets
as required under IAS 38 with a specific view to understand
how management determined whether to capitalise internally
developed software. Management reviewed whether there
was any change in the financial circumstances of the business
which warranted capitalisation of these costs. Given the
continued uncertainty over future cash flows management has
determined that it would not be appropriate to capitalise any
internally developed software. This was reviewed for both the
interim accounts as at 30 June 2019 and for this set of final
accounts for the year ended 31 December 2019. The
Committee was in agreement with the assessment.

• The continued application of IFRS 15 on revenue recognition.

The Committee has reviewed the application of the IFRS
for both interim and final accounts and, in particular, how
management has accounted for revenue under the Tencent
content and is content with the application as applied
by management.

• The implementation of IFRS 16 covering accounting for leases
which the Company has applied to leases on properties in London,
Mumbai and Shanghai. Again the Committee is content that
management has correctly interpreted and applied the standards.

Mirriad Advertising plc Annual report and accounts 2019

Remuneration Committee report

Bob Head
Chairman of the Remuneration Committee

Member

Bob Head (Chair from 13 June 2019)

John Pearson (Chair until 30 April 2019)

Alastair Kilgour (Chair from 30 April
to 13 June 2019)

Dr Mark Reilly

Number of meetings
and attendance while
in post

5/5

—

7/7

I am pleased to present the Remuneration Committee Report
for the year ended 31 December 2019.

There have been a number of changes in the Chair and
composition of the Remuneration Committee during the course
of 2019. The Committee was initially chaired by John Pearson
until his appointment as Non-executive Chairman on 30 April 2019.
Alastair Kilgour took on the Chair of the Committee from that
date until my appointment on 13 June 2019. The Remuneration
Committee currently consists of three Non-executive Directors.
Serving with me are Alastair Kilgour and Mark Reilly. The terms
of reference for the Committee also allow the Company Chairman
to attend Committee meetings. Our meetings have been both
formal and informal over the course of 2019 as we have been
active in putting in place a short-term incentive scheme for the
Company covering all employees other than designated sales
staff and a long-term incentive scheme for senior managers.

The Chief Executive Officer and Chief Financial Officer may
be invited to attend meetings of the Committee, but no Director
is involved in any decisions relating to their own remuneration.
None of the Committee has any personal financial interest (other
than as shareholders or option holders), conflicts of interest arising
from cross-directorships or day-to-day involvement in running
the business.

The Committee’s main responsibilities are to:

Set the remuneration policy for all Executive Directors
and the Company’s Chairman, including pension rights
and any compensation payments. None of the Directors
or senior managers are involved in any decisions about
their own remuneration. In addition, at least two people
are involved in every decision.

Recommend and monitor the level and structure
of remuneration for senior management.

Review the ongoing appropriateness and relevance
of overall remuneration policy.

Determine the individual remuneration packages of
Executive Directors and other senior executives, including
bonuses and incentive payments in consultation with the
Chairman and/or Chief Executive Officer, as appropriate.

Obtain reliable, up-to-date information about remuneration
in other companies of comparable scale and complexity.

Approve the design of, and determine targets for,
performance related pay schemes and approve the
total annual payments made under them.

Review the design of all share incentive plans and,
if awards are made, the overall amount of those awards
to Executive Directors and other senior executives along
with any performance targets to be used.

Set the policy for, and scope of, pension arrangements
for each Executive Director and other senior executives.

Oversee any major changes in employee benefit
structures throughout the Group.

Remuneration policy
Our remuneration policy is set to attract, retain and motivate
executive management of the quality required to run the
Company successfully without paying more than is necessary.
Our policy takes into account the Company’s risk appetite and
is aligned with the Company’s long-term strategic goals while
ensuring that overall remuneration is consistent with the
performance of the Group and retains a balance between
remuneration and shareholder value.

The Remuneration Committee reviews the performance of the
Executive Directors and makes recommendations to the Board
on matters relating to remuneration, terms of service, granting
of share options and other equity incentives.

Changes to the Chief Executive Officer’s long-term
incentive arrangements
Post the year end the Remuneration Committee agreed to
alter the long-term incentive arrangements for Stephan Beringer.
The Committee believes that these changes rebalance Stephan’s
long-term package to align it to the position when he joined the
Company and ensure it only rewards him when the Company
succeeds. When Stephan was appointed Chief Executive Officer,
the Company’s share price was trading at 30p and the number
of shares in issue was 105,122,717. Stephan was incentivised
by the award of a package of nominal value options and
performance related options which were only exercisable if the
Company’s share price rose to £1.24, double the original IPO price.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsRemuneration Committee report continued

Changes to the Chief Executive Officer’s long-term
incentive arrangements continued
Since then the Company has raised additional capital meaning
that it now has 213,108,250 shares in issue, an increase of
107,985,533 shares or 103%. Under the circumstances the
Committee felt that the existing arrangements did not adequately
incentivise Stephan to push the Company’s share price forward
to the ultimate benefit of shareholders. The Committee has used
its discretion to alter the quantum of shares over which options
have been granted to reflect the increase in the Company’s
share capital following the fundraise in August 2019.

The Committee, including the Chairman, debated the design
of a new long-term incentive package and discussed it with the
Company’s largest shareholders and NOMAD. Ultimately the
Committee agreed to cancel the performance element of Stephan’s
existing share option plan and replace it with a new one.

The new performance related long-term incentive arrangements
are as follows:

The performance option has been granted over a maximum
of 5.5 million Ordinary Shares in the Company with all triggered
options exercisable at 15p, the level at which the Company
raised fresh capital in August 2019.

Tranches of options will vest at certain trigger prices so long
as the then current share price meets or exceeds the trigger
price per share and has done so for at least 15 trading days
immediately preceding the exercise date.

The trigger prices and the amount of options vesting at each
price are shown in the table below:

Price (£)

0.30
0.45
0.60
0.75
0.90
1.05
1.20

Award

500,000
500,000
1,500,000
600,000
700,000
800,000
900,000

Once vested the options remain capable of being exercised for
10 years from the date of grant so long as Stephan remains an
employee of the Company.

The Committee believes that by setting the exercise price at the
price charged to investors in the Company’s most recent fundraising
and by ensuring that the options can only vest if the trigger prices
are achieved, Stephan’s interests are totally aligned with those
of the shareholders.

Directors’ service contracts
Under the terms of the service agreements in place with Executive
Directors, six months’ written notice must be given by either party
to terminate those service agreements. Under the terms of the
service agreements in place with Non-executive Directors,
three months’ written notice must be given by either party
to terminate that appointment.

Compensation for early termination for Executive Directors
is generally limited to six months’ base salary and benefits.
Any entitlements under incentive plans would ordinarily lapse
in accordance with the terms of the relevant plan, unless the
Remuneration Committee exercises its discretion as provided
under the incentive scheme rules.

Mirriad Advertising plc Annual report and accounts 2019

Directors’ remuneration
Normally an Executive Director’s remuneration consists of
basic salary, annual performance related bonus and long-term
incentive awards in the form of share options. The remuneration
of the Executive Directors is set by the Remuneration Committee
in accordance with the Company’s reward policy, which principally
aims to recruit and retain Directors with appropriate skills and
qualities to drive the Company’s strategy and deliver value for
shareholders. Neither Executive Director is involved in deciding
their own remuneration.

Both Executive Directors have service agreements that can be
terminated by either party giving at least six months’ written notice.

As at 31 December 2019, the basic annual salaries payable
to the Chief Executive Officer and the Chief Financial Officer
were £400,000 and £200,000 per annum, respectively.

Salaries for all staff, including Executive Directors, are reviewed
annually effective 1 January. In January 2020 the Chief Executive
Officer’s and Chief Financial Officer’s salaries were increased to
£415,200 and £207,600 respectively. These changes were made
following recommendations from the Chairman in respect of the
Chief Executive Officer and the Chief Executive Officer in respect
of the Chief Financial Officer.

Executive bonuses
The Company operates a performance related bonus scheme
for all staff, including Executive Directors. Following the year
end the Chief Executive Officer and Chief Financial Officer
were awarded bonuses of £40,000 and £12,000 respectively.
These represent 20% of the maximum possible and were triggered
by meeting certain performance criteria in the financial year
ended 31 December 2019.

Pensions
The Company operates a defined contribution pension scheme
open to all UK Executive Directors and employees.

Non-executive Directors
Non-executive Directors are not entitled to pensions, annual
bonuses or employee benefits. They are entitled to participate
in share option arrangements relating to the Company’s shares,
and both the Chairman and the independent Non-executive
Director have share option arrangements. The Board does not
consider that this compromises the independence of either of
these Directors as the quantum is neither material to Mirriad
nor the Directors.

Each of the Non-executive Directors has a contract stating
their annual fee and that their appointment is initially for a term
of three years from the date of admission, subject to re-election
at the Company’s Annual General Meeting.

Their appointment may be terminated with three months’ written
notice at any time.

The annual fee for John Pearson as Chairman was increased to
£60,000 effective 1 September 2019 following the Company’s
successful fundraise. Bob Head’s annual fee was increased to
£30,000 plus £5,000 for each Committee he chairs also effective
1 September 2019. The remaining Non-executive Directors’ annual
fees are £20,000 per annum.

Following the year end the Board also announced the award of options to purchase the Company’s shares to both its Non-executive
Chairman, John Pearson, and Bob Head, an independent Non-executive Director.

These awards are not made under the Company’s long-term incentive scheme as that only applies to employees and Executive Directors.
The grants are consistent with the incentivisation adopted for Stephan Beringer and consist of both nominal value options priced at
£0.00001 and performance related options with the same trigger prices as Stephan’s options.

John Pearson’s grant is in two parts:

The first option has been granted over 1,250,600 shares with an exercise price of £0.00001 and with one-third vesting immediately
and the remaining two-thirds vesting on 1 October 2020 and 1 October 2021 in line with the vesting dates of Stephan Beringer’s
options granted in 2018.

The second performance option has been granted over 1,349,400 shares with an exercise price of 15p. The options become capable
of vesting in accordance with the following schedule:

Price (£)

0.30

0.45

0.60

0.75

0.90

1.05

1.20

Award

122,673

368,018

147,207

171,742

196,276

220,811

Total options

1,349,400

Bob Head’s grant is also in two parts:

The first option has been granted over 400,000 shares with an exercise price of £0.00001 and with one-third vesting on
13 June 2020 (being the first anniversary of Bob Head’s appointment) and the remaining two-thirds vesting on 13 June 2021
and 13 June 2022 respectively.

The second performance option has been granted over 400,000 shares with an exercise price of 15p. The options become
capable of vesting in accordance with the following schedule:

Price (£)

0.30

0.45

0.60

0.75

0.90

1.05

1.20

Total options

Award

36,364

109,090

43,636

50,909

58,182

65,455

400,000

Directors’ share options
Aggregate emoluments disclosed below do not include any amounts for the value of options to acquire Ordinary Shares in the
Company granted to or held by the Directors.

Historically, for options granted, one-third are exercisable on the first anniversary of the grant, a further third are exercisable on
the second anniversary of the grant and the remainder are exercisable three years after the date of grant. All vested options expire
10 years after the date of grant.

In early 2020 the Committee agreed a new long-term incentive arrangement for the Company’s senior managers, not including the
Chief Executive Officer, whereby options will be granted that can be fully exercised only after three years from the date of grant with
vesting on a monthly basis during that time.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsRemuneration Committee report continued

Directors’ share options continued
Details of options for Directors who served during the year are as follows:

Executive

Stephan Beringer

David Dorans

Non-executive

Roger Faxon

John Pearson

Dr Mark Reilly

Alastair Kilgour

Options at
31 December
2019

2,102,454

2,268,068

394,210

610,696

987,218

225,000

—

Vesting dates

Exercise price

1 Oct 2019/20/21

£0.00001

1 Oct 2020/21/22

12 Nov 2019/20/21

£0.35 *

£0.195

Vested 19 Dec 2017

16 Oct 2018/19/20

—

£0.30

£0.62

—

* These options are only capable of being exercised if the Company’s share price equals or exceeds £1.24 at the date of exercise.

Directors’ remuneration

Salary/fees
£000

Bonus
£000

Employer’s
pension
£000

Other
benefits
£000

Share-based
payment
£000

Total 2019
£000

Total 2018
£000

Executive

Stephan Beringer

Mark Popkiewicz

David Dorans

Non-executive

Roger Faxon*

John Pearson

Dr Mark Reilly

Alastair Kilgour

Bob Head

* To date of resignation.

400

—

200

742

—

396

—

901

—

235

433

1,295

229

201

229

100

—

878

There are no long-term employment benefit or incentive schemes in place other than share options.

Bob Head
Non-executive Director
14 May 2020

Mirriad Advertising plc Annual report and accounts 2019

Directors’ report

Directors’ report
The Directors present their annual report and the audited
consolidated financial statements of the Group for the year
ended 31 December 2019.

Country of incorporation
Mirriad Advertising plc is a public limited company listed on
AIM and incorporated and registered in England and Wales.
The registered office address is given on the information page
inside the back cover of this document.

Review of business and future developments
The Chairman’s Statement (page 18), the Chief Executive Officer’s
Statement (page 19) and the Financial Review (pages 22 to 24)
report on the performance of the Group during the year ended
31 December 2019 and its prospects for the future.

Directors
The Directors of the Group during the year and up to the date
of signing the financial statements were:

• John Pearson – appointed 2 October 2017
• Roger Faxon – resigned 4 June 2019
• Stephan Beringer – appointed 1 October 2018
• David Dorans – appointed 19 December 2017
• Mark Reilly – appointed 19 December 2017
• Alastair Kilgour – appointed 19 December 2017
• Bob Head – appointed 13 June 2019

Significant shareholders
The Company is informed that, at 31 March 2020, individual
registered shareholdings of more than 3% of the Company’s
issued share capital were as follows:

Number of
Ordinary
Shares held

Percentage of
issued Ordinary
Share Capital

IP Group plc1
Parkwalk Advisors Ltd
M&G Investment Management
Ninety One
Investec Wealth & Investment
Janus Henderson Investors
Mole Valley Asset Management
Hargreaves Lansdown

34,393,570
31,814,133
29,666,666
11,167,943
11,131,366
7,190,000
7,115,860
6,991,184

16.1%
14.9%
13.9%
5.2%
5.2%
3.4%
3.3%
3.3%

1 Held by its subsidiary IP2IPO Portfolio LP acting by its general partner

IP2IPO (GP) Limited.

Directors’ shareholdings
The beneficial interests of the Directors in the share capital of
the Company at 31 December 2019 and at 31 March 2020 were
as follows:

Executive Directors
Stephan Beringer
David Dorans

Non-executive Directors
John Pearson
Alastair Kilgour
Dr Mark Reilly
Bob Head

Number
of Ordinary
Shares held

Percentage of
issued Ordinary
Share capital

333,333
521,357

166,666
566,668
66,666
133,333

0.16%
0.24%

0.08%
0.27%
0.03%
0.06%

Employees
The Group’s Executive management regularly delivers Company-
wide “Town Hall” style briefings on the Group’s strategy and
performance. These briefings contain details of the Group’s
financial performance where appropriate. The Group remains
committed to fair treatment of people with disabilities in relation
to job applications, training, promotion and career development.
Every effort is made to find alternative jobs for those who are
unable to continue in their existing job due to disability. The
Group takes a positive approach to equality and diversity. The
Group promotes equality in the application of reward policies,
employment and development opportunities, and aims to
support employees in balancing work and personal lifestyles.

Financial instruments
Full details of the Group’s risk management policies and
its exposure to financial risk are set out in note 3 to the
financial statements.

Directors’ indemnities and Directors’ and Officers’
liability insurance
The Company’s articles of association permit the Company
to indemnify Directors of the Company in accordance with the
Companies Act 2006. Directors’ and officers’ liability insurance
is also in place.

Annual General Meeting
The Annual General Meeting of the Group is to be held on
15 June 2020. The notice of meeting appears on pages 86 to 91
of these financial statements.

Political and charitable donations
During the year ended 31 December 2019 the Group made
political donations of £nil (2018: £nil) and charitable donations
of £nil (2018: £nil).

Supplier payment policy and practice
The Group does not operate a standard code in respect of
payments to suppliers. The Group agrees terms of payment
with suppliers at the start of business and then makes payments
in accordance with contractual and other legal obligations.

Strategic Report
Pursuant to section 414c of the Companies Act 2006 the
Strategic Report on pages 1 to 33 contains disclosures in relation
to dividends, R&D activity and post balance sheet events.

Independent auditors
In accordance with section 489 of the Companies Act, a
resolution for the re-appointment of PricewaterhouseCoopers LLP
as auditors of the Company is to be proposed at the forthcoming
Annual General Meeting.

On behalf of the Board

David Dorans
Director
14 May 2020

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsStatement of Directors’ responsibilities
In respect of the Annual Report and financial statements

The directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable law
and regulation.

The directors are also responsible for safeguarding the assets
of the group and company and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.

Company law requires the directors to prepare financial statements
for each financial year. Under that law the directors have prepared
the group financial statements in accordance with International
Financial Reporting Standards (IFRSs) as adopted by the European
Union and company financial statements in accordance with
International Financial Reporting Standards (IFRSs) as adopted by
the European Union. Under company law the directors must not
approve the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of the group
and company and of the profit or loss of the group and company
for that period. In preparing the financial statements, the directors
are required to:

• select suitable accounting policies and then apply

them consistently;

• state whether applicable IFRSs as adopted by the European

Union have been followed for the group financial statements
and IFRSs as adopted by the European Union have been followed
for the company financial statements, subject to any material
departures disclosed and explained in the financial statements;

• make judgements and accounting estimates that are

reasonable and prudent; and

• prepare the financial statements on the going concern basis

unless it is inappropriate to presume that the group and company
will continue in business.

The directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the group and
company’s transactions and disclose with reasonable accuracy
at any time the financial position of the group and company and
enable them to ensure that the financial statements comply with
the Companies Act 2006.

The directors are responsible for the maintenance and integrity
of the Company’s website. Legislation in the United Kingdom
governing the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.

Directors’ confirmations
In the case of each director in office at the date the Directors’
Report is approved:

• so far as the director is aware, there is no relevant audit
information of which the group and company’s auditors
are unaware; and

• they have taken all the steps that they ought to have taken as
a director in order to make themselves aware of any relevant
audit information and to establish that the group and company’s
auditors are aware of that information.

Mirriad Advertising plc Annual report and accounts 2019

Independent auditors’ report
To the members of Mirriad Advertising plc

Report on the audit of the financial statements
Opinion
In our opinion, Mirriad Advertising plc’s Group financial statements and Company financial statements (the “financial statements”):

• give a true and fair view of the state of the Group’s and of the Company’s affairs as at 31 December 2019 and of the Group’s

loss and the Group’s and Company’s cash flows for the year then ended;

• have been properly prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European

Union; and

• have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements, included within the Annual Report and accounts (the “Annual Report”), which comprise:
the Consolidated and Company balance sheets as at 31 December 2019; the Consolidated statement of profit or loss, the Consolidated
statement of comprehensive income, the Consolidated statement of changes in equity, the Company statement of changes in equity
and the Consolidated and Company statement of cash flows for the year then ended; and the notes to the financial statements,
which include a description of the significant accounting policies.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our
responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section
of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence
We remained independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements
in the UK, which includes the FRC’s Ethical Standard, as applicable to listed entities, and we have fulfilled our other ethical responsibilities
in accordance with these requirements.

Our audit approach
Overview

Materiality

Audit
scope

Key audit
matters

• Overall Group materiality: £594,000 (2018: £646,000), based on 5% of loss before tax.

• Overall Company materiality: £416,000 (2018: £434,000), based on 5% of loss before tax.

• There are six reporting units in the Group: Mirriad Advertising plc (which records the majority of Group activity),
Mirriad Inc. (which records all of the activity in the USA), Mirriad Advertising Private Limited (India), Mirriad
(Singapore) Pte. Ltd, Mirriad Software Science and Technology (Shanghai) Co. Ltd and Mirriad Brasil Tecnologias
Para Midia Ltda.

• For each reporting unit we determined whether we required an audit of its complete financial information
(“full scope”) or whether specified procedures addressing specific risk characteristics or particular financial
statement line items would be sufficient.

• It was assessed that Mirriad Advertising plc and Mirriad Inc. were the only reporting units that were required to
be full scope, with the other four reporting units contributing 8% to loss before tax and 2% of Group total assets.

• Other specified procedures were required for China as it contributed 68% of Group revenue. The revenue was
scoped in as part of our audit procedures on top of the two full scope UK and USA entities. No other balances
in China were above the 15% threshold considered to be a significant balance to the Group audit. In addition,
for the remaining reporting units that are not considered in scope we have performed procedures to identify
any unusual or unexpected transactions or balances.

• Fraud in revenue recognition (Group and Company)

• Impact of COVID-19 (Group and Company)

The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements.
In particular, we looked at where the directors made subjective judgements, for example in respect of significant accounting estimates
that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits we also addressed
the risk of management override of internal controls, including evaluating whether there was evidence of bias by the directors that
represented a risk of material misstatement due to fraud.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsIndependent auditors’ report continued
To the members of Mirriad Advertising plc

Report on the audit of the financial statements continued
Our audit approach continued
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not
due to fraud) identified by the auditors, including those which had the greatest effect on: the overall audit strategy; the allocation
of resources in the audit; and directing the efforts of the engagement team. These matters, and any comments we make on the results
of our procedures thereon, were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters. This is not a complete list of all risks identified by our audit.

Key audit matter

How our audit addressed the key audit matter

Fraud in revenue recognition
• Fraud in revenue recognition is considered a key audit

• We understood how management recognise and process revenue

through performing a walkthrough of the revenue cycle;

matter given the inherent nature of the business, as a listed
Technology company, with the primary objective to grow
revenue and become profitable.

• The majority of revenue is recognised once the Native In

Video Advertising (“NIVA”) service (inserting advertising into
content) has been provided to the customer. The timing of
when the service is delivered, and therefore when revenue
is recognised, is not complex or judgemental.

• The key risk is considered to be in relation to the existence
of revenue – that a customer exists, and the service has
been provided.

(Group and Company)

Impact of COVID-19 (refer to post balance sheet
events disclosure)
• We focused on this area as a result of the ongoing pandemic
and its impact across all businesses. Specifically, due to the
historic losses and cash outflows incurred by the Group and
Company and the possible negative impact of COVID-19 on
2020 and future operations. The Group had cash resources
of £19.1 million at 31 December 2019 and no borrowing.

• Management have prepared detailed cash flow forecasts, based
on a number of assumptions, through to 31 December 2021.
The forecasted cash outflows include the results of ongoing
operations including the possible negative impact from COVID-19.
Management consider there to be sufficient cash for at least
12 months from the date of signing the financial statements.

• The potential impact of COVID-19 on the Group and Company
going concern assumption is fundamental to the presentation
of the financial statements and therefore a change in this
assumption would alter their basis of presentation including
their post balance sheet events disclosure.

(Group and Company)

• We obtained detailed revenue listings for the UK and China

entities and agreed these to the general ledger;

• We tested a sample of revenue transactions to sales invoices
and also to customer buy (purchase) orders and/or contracts
and/or written communications;

• We tested a sample of the revenue transactions selected

to subsequent customer cash receipts; and

• We performed data analysis to identify potentially unusual
journal entries impacting revenue and performed testing
on those items.

We found no material misstatements from our testing.

We obtained management’s cash flow forecasts, which extend
at least twelve months from the date of approval of the financial
statements, and evaluated whether the forecasts indicate that the
Group and Company would have sufficient cash to continue in
operation over the forecast period. We also reviewed the minutes
of recent Board meetings and post year end management accounts,
and checked the amount of cash on hand at 30 April 2020 (£15.8m).

We performed sensitivity analysis over the significant
assumptions within managements cash flow analysis, including
those related to COVID-19, both individually and collectively
to ascertain the extent of change that would be required for the
Group and Company to be unable to meet its ongoing liabilities
as they fall due. We also considered the likelihood of such
change arising. Our testing identified that the combination
of circumstances necessary to lead to the Group and Company
having insufficient cash to meet their ongoing liabilities as they
fall due appears unlikely to occur in the foreseeable future.
For example, if only contracted and guaranteed revenue were
achieved for the period to 30 June 2021 and the cost base
was 10% higher than FY2019 (excluding restructuring costs),
there would still be sufficient cash resources to fund
management’s activities until into the third quarter of 2021.

Our conclusion on going concern is set out below.

Mirriad Advertising plc Annual report and accounts 2019

Report on the audit of the financial statements continued
Our audit approach continued
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements
as a whole, taking into account the structure of the Group and the Company, the accounting processes and controls, and the industry
in which they operate.

We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements
as a whole, taking into account the structure of the Group and the Company, the accounting processes and controls, and the industry
in which they operate.

The Group’s accounting process is structured around a central finance function based in the UK. The finance function has control
and oversight of all overseas territories, even where the overseas territories have a small local finance function.

Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality.
These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent
of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements,
both individually and in aggregate on the financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Overall materiality

£594,000 (2018: £646,000).

£416,000 (2018: £434,000).

How we determined it

5% of loss before tax.

Group financial statements

Company financial statements

Rationale for benchmark applied Based on the benchmarks used in the annual
report, loss before tax is the primary measure
used by the shareholders in assessing the
performance of the Group, and is a generally
accepted auditing benchmark. The materiality
rule of thumb is consistent with the prior year.

Based on the benchmarks used in the
annual report, loss before tax is the primary
measure used by the shareholders in assessing
the performance of the Company, and is a
generally accepted auditing benchmark.
The materiality rule of thumb is consistent
with the prior year.

For each component in the scope of our Group audit, we allocated a materiality that is less than our overall Group materiality.
The range of materiality allocated across components was between £416,000 and £325,000. Certain components were audited
to a local statutory audit materiality that was also less than our overall Group materiality.

We agreed with the Audit Committee that we would report to them misstatements identified during our audit above £29,700
(Group audit) (2018: £32,000) and £20,800 (Company audit) (2018: £21,700) as well as misstatements below those amounts that,
in our view, warranted reporting for qualitative reasons.

Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which ISAs (UK) require us to report to you where:

• the directors’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

• the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt
about the Group’s and Company’s ability to continue to adopt the going concern basis of accounting for a period of at least
twelve months from the date when the financial statements are authorised for issue.

However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Group’s
and Company’s ability to continue as a going concern.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsIndependent auditors’ report continued
To the members of Mirriad Advertising plc

Report on the audit of the financial statements continued
Our audit approach continued
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’
report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the
other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this
report, any form of assurance thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise
appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform
procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other
information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report based on these responsibilities.

With respect to the Strategic Report and Directors’ Report, we also considered whether the disclosures required by the UK Companies
Act 2006 have been included.

Based on the responsibilities described above and our work undertaken in the course of the audit, ISAs (UK) require us also to report
certain opinions and matters as described below.

Strategic Report and Directors’ Report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic Report and Directors’
Report for the year ended 31 December 2019 is consistent with the financial statements and has been prepared in accordance with
applicable legal requirements.

In light of the knowledge and understanding of the Group and Company and their environment obtained in the course of the audit,
we did not identify any material misstatements in the Strategic Report and Directors’ Report.

Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of Directors’ Responsibilities, the directors are responsible for the preparation of the financial
statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are
also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group’s and the Company’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless
the directors either intend to liquidate the Group or the Company or to cease operations, or have no realistic alternative but to do so.

Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.

Use of this report
This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with Chapter 3
of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility
for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly
agreed by our prior consent in writing.

Mirriad Advertising plc Annual report and accounts 2019

Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:

• we have not received all the information and explanations we require for our audit; or

• adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received

from branches not visited by us; or

• certain disclosures of directors’ remuneration specified by law are not made; or

• the Company financial statements are not in agreement with the accounting records and returns.

We have no exceptions to report arising from this responsibility.

Gareth Murfitt (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
Reading
14 May 2020

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsConsolidated statement of profit or loss
For the year ended 31 December 2019

Revenue

Cost of sales

Gross profit

Administrative expenses

Other operating income

Operating loss

Finance income

Finance costs

Finance income – net

Loss before income tax

Income tax credit

Loss for the year

Loss per Ordinary Share – basic

All activities are classified as continuing.

Year ended
31 December
2019
£

Year ended
31 December
2018
£

Note

1,139,538

415,886

(178,091)

(143,548)

961,447

272,338

(13,159,812)

(14,872,725)

24,421

171,433

(12,173,944)

(14,428,954)

46,436

(23,627)

22,809

57,968

—

57,968

(12,151,135)

(14,370,986)

56,231

42,217

(12,094,904)

(14,328,769)

(8p)

(14p)

The Company has elected to take the exemption under section 408 of the Companies Act 2006 from presenting the parent company
profit and loss account.

Consolidated statement of comprehensive income
For the year ended 31 December 2019

Loss for the financial year

Other comprehensive income/(loss)

Items that may be reclassified to profit or loss:

Exchange differences on translation of foreign operations

Total comprehensive loss for the year

Year ended
31 December
2019
£

Year ended
31 December
2018
£

(12,094,904)

(14,328,769)

136,179

(88,346)

(11,958,725)

(14,417,115)

Items in the statement above are disclosed net of tax. The income tax relating to each component of other comprehensive income is
disclosed in note 10.

Mirriad Advertising plc Annual report and accounts 2019

Consolidated and Company balance sheets
At 31 December 2019

Assets

Non-current assets

Property, plant and equipment

Intangible assets

Investments

Trade and other receivables

Current assets

Trade and other receivables

Other current assets

Cash and cash equivalents

Total assets

Liabilities

Non-current liabilities

Lease liabilities

Current liabilities

Trade and other payables

Current tax liabilities

Lease liabilities

Total liabilities

Net assets

Equity and liabilities

Equity attributable to owners of the parent

Share capital

Share premium

Share-based payment reserve

Retranslation reserve

Accumulated losses

Total equity

Group

Company

As at
31 December
2019
£

As at
31 December
2018
£

As at
31 December
2019
£

As at
31 December
2018
£

Note

912,983

—

414,062

170,053

—

212,143

186,321

769,509

—

410,015

162,962

328,842

170,053

239,363

162,962

1,125,126

770,436

1,342,486

901,220

1,024,996

76,754

973,750

288,009

455,890

76,754

587,151

288,009

19,091,613

15,203,920

18,542,360

14,621,951

20,193,363

16,465,679

19,075,004

15,497,111

21,318,489

17,236,115

20,417,490

16,398,331

423,328

—

407,634

—

1,297,624

1,622,460

1,029,580

1,267,132

24,809

373,227

36,952

—

271,600

—

1,695,660

1,659,412

1,301,180

1,267,132

2,118,988

1,659,412

1,708,814

1,267,132

19,199,501

15,576,703

18,708,676

15,131,199

52,029

50,949

52,029

50,949

17 40,932,183

25,643,192

40,932,183

25,643,192

2,500,944

2,141,094

2,500,944

2,141,094

(142,652)

(278,831)

—

(24,143,003)

(11,979,701)

(24,776,480)

(12,704,036)

19,199,501

15,576,703

18,708,676

15,131,199

The financial statements on pages 56 to 85 were approved the Board of Directors on 14 May 2020 and signed on its behalf by:

David Dorans
Chief Financial Officer

Mirriad Advertising plc

Company number: 09550311

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

Consolidated statement of changes in equity
For the year ended 31 December 2019

Year ended 31 December 2018

Note

Share capital
£

Share-based
Share premium payment reserve
£

Retranslation
reserve
£

Retained
earnings/
(accumulated
losses)
£

Total equity
£

Balance at 1 January 2018

50,917

23,717,390

1,964,835

(190,485)

2,349,068

27,891,725

Loss for the financial year

Other comprehensive loss
for the year

Total comprehensive loss
for the year

Proceeds from
shares issued

Share issue costs

Share-based payments
recognised as expense

Total transactions with
shareholders recognised
directly in equity

—

1,999,968

(74,166)

—

176,259

1,925,802

176,259

— (14,328,769)

(14,328,769)

(88,346)

—

(88,346)

(14,328,769)

(14,417,115)

—

2,000,000

(74,166)

176,259

—

2,102,093

Balance at 31 December 2018

50,949

25,643,192

2,141,094

(278,831)

(11,979,701)

15,576,703

Note

Share capital
£

Share-based
Share premium payment reserve
£

Retranslation
reserve
£

Accumulated
losses
£

Total equity
£

Year ended 31 December 2019

Balance at 31 December 2018 as
originally presented

50,949

25,643,192

2,141,094

(278,831)

(11,979,701)

15,576,703

Change in accounting policy

—

(68,398)

Balance at 1 January 2019

50,949

25,643,192

2,141,094

(278,831)

(12,048,099)

15,508,305

Loss for the financial year

Other comprehensive
income for the year

Total comprehensive loss
for the year

Proceeds from
shares issued

Share issue costs

Share-based payments
recognised as expense

—

1,080

16,196,750

(907,759)

—

Total transactions with shareholders
recognised directly in equity

1,080

15,288,991

359,850

—

359,850

—

— (12,094,904)

(12,094,904)

136,179

—

136,179

(12,094,904)

(11,958,725)

—

16,197,830

(907,759)

359,850

—

15,649,921

Balance at 31 December 2019

52,029

40,932,183

2,500,944

(142,652)

(24,143,003)

19,199,501

Mirriad Advertising plc Annual report and accounts 2019

Company statement of changes in equity
For the year ended 31 December 2019

Balance at 1 January 2018

Loss for the financial year

Total comprehensive loss for the year

Proceeds from shares issued

Share issue costs

Share-based payments recognised
as expense

Total transactions with shareholders
recognised directly in equity

Year ended 31 December 2018

Note

Share capital
£

Share-based
Share premium payment reserve
£

Retained
earnings/
(accumulated
losses)
£

Total equity
£

50,917

23,717,390

1,964,835

1,547,572

27,280,714

—

— (14,251,608)

(14,251,608)

— (14,251,608)

(14,251,608)

1,999,968

(74,166)

—

176,259

1,925,802

176,259

—

2,000,000

(74,166)

176,259

2,102,093

Balance at 31 December 2018

50,949

25,643,192

2,141,094

(12,704,036)

15,131,199

Year ended 31 December 2019

Note

Share capital
£

Share-based
Share premium payment reserve
£

Accumulated
losses
£

Total equity
£

Balance at 31 December 2018
as originally presented

50,949

25,643,192

2,141,094

(12,704,036)

15,131,199

Change in accounting policy

—

(35,418)

Balance at 1 January 2019

Loss for the financial year

Total comprehensive loss for the year

Proceeds from shares issued

Share issue costs

Share-based payments recognised
as expense

Total transactions with shareholders
recognised directly in equity

50,949

25,643,192

2,141,094

(12,739,454)

15,095,781

—

1,080

16,196,750

(907,759)

—

359,850

— (12,037,026)

(12,037,026)

— (12,037,026)

(12,037,026)

—

16,197,830

(907,759)

359,850

1,080

15,288,991

359,850

—

15,649,921

Balance at 31 December 2019

52,029

40,932,183

2,500,944

(24,776,480)

18,708,676

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

Consolidated and Company statement of cash flows
For the year ended 31 December 2019

Cash flow used in operating activities

(11,222,098)

(11,972,408)

(11,224,623)

(12,130,841)

Group

2019
£

2018
£

Note

Company

2019
£

2018
£

Tax credit received

Taxation paid

Interest received

Lease interest paid

291,502

(43,288)

46,436

(23,627)

—

291,502

(6,691)

57,968

—

44,664

(26,124)

—

56,132

—

Net cash used in operating activities

(10,951,075)

(11,921,131)

(10,914,581)

(12,074,709)

Cash flow from investing activities

Investment in subsidiaries

Capitalisation of development costs

Purchase of tangible assets

—

(168,587)

(878,500)

(170,652)

(168,587)

—

(878,500)

(62,484)

(137,386)

(39,053)

(57,292)

Proceeds from disposal of tangible assets

236

—

100

—

Net cash used in investing activities

Cash flow from financing activities

Proceeds from issue of Ordinary Share capital
(net of costs of issue)

(62,248)

(1,184,473)

(209,605)

(1,104,379)

15,290,071

1,925,834

15,290,071

1,925,834

Payment of lease liabilities

(389,055)

—

(245,476)

—

Net cash generated from financing activities

14,901,016

1,925,834

15,044,595

1,925,834

Net increase/(decrease) in cash and cash equivalents

3,887,693

(11,179,770)

3,920,409

(11,253,254)

Cash and cash equivalents at the beginning of the year

15,203,920

26,383,690

14,621,951

25,875,205

Cash and cash equivalents at the end of the year

19,091,613

15,203,920

18,542,360

14,621,951

Cash and cash equivalents consists of:

Cash at bank and in hand

Cash and cash equivalents

19,091,613

15,203,920

18,542,360

14,621,951

19,091,613

15,203,920

18,542,360

14,621,951

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements
For the year ended 31 December 2019

1. Summary of significant accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been
consistently applied to all the years presented.

1.1 Basis of preparation
The financial statements of Mirriad Advertising plc have been prepared in accordance with International Financial Reporting
Standards (“IFRS”) and IFRS Interpretations Committee (“IFRS IC”) interpretations as adopted by the European Union and with
the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared under
the historical cost convention.

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 financial statements
are disclosed in note 4.

1.1.1 Going concern
The financial statements have been prepared on the going concern basis. After making enquiries and producing cash flow forecasts,
the Directors have reasonable expectations, as at the date of approving the financial statements, that the Company and the Group
have adequate resources to fund the Company and the Group for the next 12 months. The Group’s cash holding at 30 April 2020
was £15.81m and the Directors disclosed that the Group’s cash burn continues to be not more than £1m per month and is anticipated
to gradually improve with increased revenues. Revenues will increase in 2020 as a result of higher contracted minimum guaranteed
revenues. On the basis of the Company’s internal forecasts the Directors believe that the Company has sufficient cash resources to
fund its activities until the end of the third quarter 2021 at which point it may require additional cash resources depending on the
rate of increase in revenue.

The Directors have also reviewed the potential impact of COVID-19 on the business and believe that, while there is significant
uncertainty about the longer-term impact of the virus on the business, it does not change their going concern assessment.

2. Accounting policies
2.1 Changes in accounting policy and disclosures
(a) New standards, amendments and interpretations
The Group has applied the following standards and amendments for the first time for the annual reporting period commencing
1 January 2019:

• IFRS 16 “Leases”;

• Prepayment Features with Negative Compensation – Amendments to IFRS 9;

• Long-term Interests in Associates and Joint Ventures – Amendments to IAS 28;

• Annual Improvements to IFRS 2015–2017 Cycle;

• Plan Amendment, Curtailment or Settlement – Amendments to IAS 19; and

• IFRIC 23 “Uncertainty over Income Tax Treatments”.

The Group had to change its accounting policies as a result of adopting IFRS 16. The Group elected to adopt the new rules
retrospectively but recognised the cumulative effect of initially applying the new standard on 1 January 2019. This is disclosed
in note 2.12. The other amendments listed above did not have any impact on the amounts recognised in prior periods and are
not expected to significantly affect the current or future periods.

(b) New standards, amendments and interpretations not yet adopted
A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after
1 January 2020, and have not been applied in preparing these financial statements. These standards are not expected to have
a material impact on the entity in the current or future reporting periods or on foreseeable future transactions.

2.2 Business combinations
Business combinations are accounted for by applying the purchase method.

The cost of a business combination is the fair value of the consideration given, liabilities incurred or assumed and of equity
instruments issued plus the costs directly attributable to the business combination.

On acquisition of a business, fair values are attributed to the identifiable assets, liabilities and contingent liabilities unless the fair
value cannot be measured reliably, in which case the value is incorporated in goodwill. Where the fair value of contingent liabilities
cannot be reliably measured they are disclosed on the same basis as other contingent liabilities.

Goodwill recognised represents the excess of the fair value and directly attributable costs of the purchase consideration over the
fair values to the Group’s interest in the identifiable net assets, liabilities and contingent liabilities acquired.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements2. Accounting policies continued
2.3 Consolidation
The Group consolidated financial statements include the financial statements of the Company and all of its subsidiary undertakings
made up to 31 December 2019, and the prior year to 31 December 2018.

A subsidiary is an entity controlled by the Group. Control is the power to govern the financial and operating policies of an entity so as
to obtain benefits from its activities.

Any subsidiary undertakings or associates sold or acquired during the year are included up to, or from, the dates of change of control
or change of significant influence respectively.

Where control of a subsidiary is lost, the gain or loss is recognised in the consolidated income statement. The cumulative amounts
of any exchange differences on translation, recognised in equity, are not included in the gain or loss on disposal and are transferred to
retained earnings. The gain or loss also includes amounts included in other comprehensive income that are required to be reclassified
to profit or loss but excludes those amounts that are not required to be reclassified.

All intra-group transactions, balances, income and expenses are eliminated on consolidation. Adjustments are made to eliminate the
profit or loss arising on transactions with associates to the extent of the Group’s interest in the entity.

2.4 Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic
environment in which each entity operates (the “functional currency”). The consolidated financial statements are presented in Pound
Sterling, which is the functional and presentational currency of the Company and the presentation currency of the Group.

(ii) Transactions and balances
Transactions in foreign currencies are translated into Sterling at the exchange rate ruling at the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are translated into Sterling at the rates of exchange ruling at the balance sheet date.
Any gain or loss arising from a change in exchange rates subsequent to the date of the transactions is included as an exchange gain
or loss in the profit and loss account.

Non-monetary items measured at historical costs are translated using the exchange rate at the date of the transaction and non-monetary
items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit and loss
account within “Finance income or finance costs”. All other foreign exchange gains and losses are presented in the profit and loss
account within “Administrative expenses”.

(iii) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have
a functional currency different from the presentation currency are translated into the presentation currency as follows:

(a) assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;

(b) income and expenses for each income statement are translated at average exchange rates (unless this average is not a reasonable
approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are
translated at the rate on the dates of each transaction); and

2.5 Revenue recognition
Revenue is recognised in accordance with the requirements of IFRS 15 “Revenue from contracts with customers”. The Company
recognises revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration
to which the entity expects to be entitled in exchange for those goods or services. This core principle is delivered in a five-step model
framework:

(1) identify the contract(s) with the customer;

(2) identify the performance obligations in the contract;

(3) determine the transaction price;

(4) allocate the transaction price to the performance obligations in the contract; and

(5) recognise revenue when (or as) the entity satisfy a performance obligation.

All Group revenue comes from the primary business activity of providing in-video advertising services to broadcasters, advertisers, brand
owners and their agencies. This involves the insertion by the Group of a product, signage or video into existing content. In accordance
with IFRS 15 revenue is recognised when the services have been delivered and the “asset” transferred to customers in accordance with
contractual terms and conditions and there are no further obligations attached.

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 20192. Accounting policies continued
2.5 Revenue recognition continued
Most of the Group’s client contracts do not specify revenue values but provide a framework, and normally a share of customer
revenue, within which individual work to produce campaigns and revenues are agreed and executed. The exact revenue for each
campaign is set out in the relevant insertion (purchase) order which shows the agreed number of advertising units or insertions to
be delivered.

The revenue on such campaigns is currently recognised on a monthly basis depending on campaign progress and ad units delivered
to the client, as a proportion of the total campaign goals or agreed fee. This matches the process of the “assets” generated from the
campaigns being transferred to the client, for which the Group is entitled to revenue as the “assets” are produced.

Where a fixed or minimum revenue value is specified in the contract, this is recognised in line with the agreed performance criteria
where these have been specified in the contract.

2.6 Cost of sales
Cost of sales comprises costs directly related to the ad delivery team in India, which performs the integration work of the creative
imagery into the original content and quality control of the end result. All other staff costs are included in administrative costs below
gross profit.

2.7 Other operating income
Other operating income for the Group relates to income received from government grants.

2.8 Government grants
Grant income represents amounts received from the government to assist with the funding of research and development activities carried
out by the Group. Government grant income is recognised at fair value in the profit and loss account at the point that there is reasonable
assurance that the Group has complied with the conditions attaching to them and the grants will be received. Government grants are
recognised in the income statement on a systematic basis over the periods in which the related costs towards which they are intended to
compensate are recognised as expenses. Where grant related costs relate to staff expenses which are being capitalised as development
costs the related grant income is not recognised in the income statement but is instead deducted in arriving at the intangible asset
being recognised.

2.9 Interest income
Interest income is recognised using the effective interest rate method.

2.10 Current and deferred tax
Taxation expense for the year comprises current and deferred tax recognised in the reporting period. 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. In this case tax
is also recognised in other comprehensive income or directly in equity respectively.

Current tax is the amount of income tax payable or receivable in respect of the taxable profit or loss for the year or prior years.
Tax is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the year end.

Deferred tax is the timing difference between the tax base and the carrying value in the balance sheet. These timing differences
arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised
in the financial statements.

Deferred tax is recognised on all timing differences at the reporting date except for certain exceptions. Unrelieved tax losses
and other deferred tax assets are only recognised when it is probable that they will be recovered against the reversal of deferred
tax liabilities or other future taxable profits.

Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are
expected to apply to the reversal of the timing difference.

Research and development tax credits are recognised as an income tax credit in the income statement, with a corresponding asset
recognised until the amounts are received. Such amounts are only recognised at the year end based on an assessment of relevant
time spent by employees on research and development activities. Where government grants have been received against the same
employee costs, such amounts are removed from the R&D tax credit calculations.

2.11 Leases
The Group leases offices in the countries where it operates, and rental contracts are typically made for fixed periods of 1 to 10 years
but may be extended in some cases. Lease terms are negotiated on an individual basis and contain a wide range of different terms and
conditions. Until the 2018 financial year, leases of property, plant and equipment were classified as either finance or operating leases.
Payments made under operating leases (net of any incentives received from the lessor) were charged to profit or loss on a straight
line basis over the period of the lease.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements2. Accounting policies continued
2.11 Leases continued
From 1 January 2019, leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset
is available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance cost is charged
to profit or loss 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 right-of-use asset is depreciated over the shorter of the asset’s useful life and the lease term on a straight line basis.
The impact of this change in accounting policy is described in note 2.12 below.

Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value
of the following lease payments:

• fixed payments (including in-substance fixed payments), less any lease incentives receivable;

• variable lease payments that are based on an index or a rate;

• amounts expected to be payable by the lessee under residual value guarantees;

• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option; and

• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.

The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be determined, the lessee’s
incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds necessary to obtain
an asset of similar value in a similar economic environment with similar terms, security and conditions.

Right-of-use assets are measured at cost comprising the following:

• the amount of the initial measurement of lease liability;

• any lease payments made at or before the commencement date less any lease incentives received;

• any initial direct costs; and

• restoration costs.

As all the right-of-use assets held by the Group are property leases these are depreciated over the non-cancellable portion of the
lease term.

Payments associated with short-term leases and leases of low-value assets are recognised on a straight line basis as an expense
in profit or loss. Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT equipment.

2.12 Impact of IFRS 16 adoption
This note explains the impact of the adoption of IFRS 16 “Leases” on the Group’s financial statements.

As indicated in note 2.1(a) above the Group has adopted IFRS 16 retrospectively from 1 January 2019, but has not restated
comparatives for the 2018 reporting period, as permitted under the modified retrospective approach which is one of the specified
transitional provisions in the standard. The reclassifications and the adjustments arising from the new leasing rules are therefore
recognised in the opening balance sheet on 1 January 2019.

On adoption of IFRS 16, the Group recognised lease liabilities in relation to leases which had previously been classified as “operating
leases” under the principles of IAS 17 “Leases”. These liabilities were measured at the present value of the remaining lease payments,
discounted using the lessee’s incremental borrowing rate as of 1 January 2019. The weighted average lessee’s incremental borrowing
rate applied to the lease liabilities on 1 January 2019 was 4% for a UK property lease, 4.75% for a Chinese property lease and 10%
for an Indian property lease.

(i) Practical expedients applied
In applying IFRS 16 for the first time, the Group has used the following practical expedients permitted by the standard:

• the accounting for operating leases with a remaining lease term of less than 12 months as at 1 January 2019 as short-term leases;

• the exclusion of initial direct costs for the measurement of the right-of-use asset at the date of initial application; and

• the use of hindsight in determining the lease term where the contract contains options to extend or terminate the lease.

The Group has also elected not to reassess whether a contract is, or contains, a lease at the date of initial application. Instead, for
contracts entered into before the transition date the Group relied on its assessment made applying IAS 17 and IFRIC 4 “Determining
whether an Arrangement contains a Lease”.

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 20192. Accounting policies continued
2.12 Impact of IFRS 16 adoption continued
(ii) Measurement of lease liabilities

Operating lease commitments disclosed at 31 December 2018

Discounted using the lessee’s incremental borrowing rate at the date of initial application

Less: short-term leases not recognised as a liability

Add: adjustments as a result of a different treatment of extension and termination options

Lease liability recognised as at 1 January 2019

Of which are:

Current lease liabilities

Non-current lease liabilities

2019
£

1,077,688

1,018,926

(28,203)

195,408

1,186,131

378,434

807,697

1,186,131

(iii) Measurement of right-of-use assets
The associated right-of-use assets for property leases were measured on a retrospective basis as if the new rules had always
been applied. There were no onerous lease contracts that would have required an adjustment to the right-of-use assets at the
date of initial application.

All right-of-use assets recognised relate to property leases and have been included within property, plant and equipment on the
balance sheet.

(iv) Adjustments recognised in the balance sheet on 1 January 2019
The change in accounting policy affected the following items in the Group balance sheet on 1 January 2019:

• property, plant and equipment (right-of-use assets) – increase by £950,330;

• lease liabilities – increase by £1,186,131; and

• trade and other payables (rent-free period accrual) – decrease by £167,403.

The net impact on Group accumulated losses on 1 January 2019 was an increase of £68,398.

The impact on the Company balance sheet on 1 January 2019 was as follows:

• property, plant and equipment (right-of-use assets) – increase by £721,888;

• lease liabilities – increase by £924,710; and

• trade and other payables (rent-free period accrual) – decrease by £167,403.

The net impact on Company accumulated losses on 1 January 2019 was an increase of £35,418.

2.13 Employee benefits
(i) Pension
The Company operates a defined contribution pension scheme for UK employees. The contributions are recognised as an employee
benefit expense when they are due. Differences between contributions payable in the year and contributions actually paid are shown
as accruals in the consolidated statement of financial position. The Company has no further payment obligation once the contributions
have been made.

(ii) Annual bonus plan
The Company operates an annual bonus plan for all employees. An expense is accrued over the related service period and recognised
in the profit and loss account when the Company has a legal or constructive obligation to make payments under the plan as a result
of past events and a reliable estimate of the obligation can be made.

2.14 Share-based payments
The Group operates a number of equity-settled, share-based compensation schemes to certain key employees. The fair value
of share-based payments under such schemes is expensed on a straight line basis over the vesting period, based on the Group’s
estimate of shares that will eventually vest, with a corresponding entry to equity. In arriving at this estimate the Company takes
into account non-market-based factors and the expected attrition of employees over the year.

Fair value is determined using the Black-Scholes model and requires several assumptions and estimates as disclosed in note 20.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

2. Accounting policies continued
2.15 Property, plant and equipment
Tangible fixed assets are stated at historic purchase cost, net of accumulated depreciation and any provision for impairment.
Cost includes the original purchase price of the asset and costs attributable to bringing the asset into its working condition
for its intended use.

Depreciation and residual values
The fixed assets have been depreciated on a straight line basis at rates calculated to reduce the net book value of each asset to its
estimated residual value by the end of its expected useful economic life in the Company’s business, and the rates are as follows:

• Fixtures, fittings and computer equipment – 3 years

• Leasehold improvements

– 5 years (based on length of current lease)

• Right-of-use assets

– 2-5 years based on non-cancellable portion of current leases

The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at the end of each reporting period. The effect
of any change is accounted for prospectively.

Derecognition
Tangible assets are derecognised on disposal or when no future economic benefits are expected. On disposal, the difference between
the net disposal proceeds and the carrying amount is recognised in profit or loss and included in “Administrative expenses”.

2.16 Intangible assets
Computer software
Costs associated with maintaining computer software programs are recognised as an expense as incurred. Development costs that
are directly attributable to the design and testing of identifiable and unique software products controlled by the Group are recognised
as intangible assets when the following criteria are met:

• it is technically feasible to complete the software product so that it will be available for use;

• management intends to complete the software product and use or sell it;

• there is an ability to use or sell the software product;

• it can be demonstrated how the software product will generate probable future economic benefits;

• adequate technical, financial and other resources to complete the development and to use or sell the software product are

available; and

• the expenditure attributable to the software product during its development can be reliably measured.

Directly attributable costs that are capitalised as part of the software product include the development employee costs and the fees
of any contractors directly involved in the project.

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 year.

Computer software development costs recognised as assets are amortised over their estimated useful life, which does not exceed
three years.

Intellectual property and patents
Patents and brand assets acquired were valued based on a relief from royalty approach, and are amortised over their useful economic
life of four years. Brand assets are included in “Other intangible assets”.

Intangible assets are stated at cost or valuation less accumulated amortisation and accumulated impairment losses. Amortisation is
calculated, using the straight line method, to allocate the depreciable amount of the assets to their residual values over their estimated
useful lives, as follows:

• Patents – 4 years

• Internally generated software development costs – 3 years

• Other intangible assets – 4 years

Amortisation is charged to administrative expenses in the profit and loss account.

Where factors, such as technological advancement or changes in market price, indicate that residual value or useful life have changed,
the residual value, useful life or amortisation rate are amended prospectively to reflect the new circumstances. The assets are reviewed
for impairment if the above factors indicate that the carrying amount may be impaired.

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

2. Accounting policies continued
2.17 Trade receivables
Trade receivables are amounts due from customers for services rendered in the ordinary course of business. If collection is expected
in one year or less they are classified as current assets. Trade receivables are recognised initially at fair value and subsequently measured
at amortised cost using the effective interest method, less expected credit losses in accordance with IFRS 9.

2.18 Cash and cash equivalents
Cash and cash equivalents includes cash in hand and deposits held at call with banks with original maturities of three months or less.

2.19 Trade payables
Trade 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. Trade receivables are recognised initially
at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment.

2.20 Share capital
Ordinary Shares, preference shares and deferred shares are classified as equity. Incremental costs directly attributable to the issue
of new Ordinary and preference shares or options are shown in equity as a deduction, net of tax, from the proceeds, and taken against
the share premium account.

2.21 Related party transactions
The Group discloses transactions with related parties which are not wholly owned within the same Group. Where appropriate,
transactions of a similar nature are aggregated unless, in the opinion of the Directors, separate disclosure is necessary to understand
the effect of the transactions on the Group historical financial information. It does not disclose transactions with members of the
same Group that are wholly owned.

3. Financial risk management
3.1 Group financial risk factors
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk), credit risk and liquidity risk. The Group’s
overall risk management programme is focused on operating cost and cash management.

(a) Currency risk
The Group operates internationally and is exposed to foreign exchange risk from various currency exposures, primarily with respect
to the US Dollar, Indian Rupee, Singapore Dollar and Chinese Yuan. Foreign exchange risk arises from commercial transactions and
investments in foreign subsidiaries.

The Group has certain investments in foreign subsidiaries, whose net assets are exposed to foreign currency translation risk. There are
currently no measures in place to manage currency exposure arising from the net assets of the Group’s foreign operations. Such movements
are recognised in the income statement and statement of comprehensive income. For the year ended 31 December 2019 the revaluation
gain on foreign subsidiary net assets recognised in the statement of comprehensive income was £136,179 (2018: loss of £88,346).

Brexit continues to cause fluctuations in the value of Sterling and there has been mixed impact on the Group. When Sterling depreciates
the Group’s overseas income increases but the cost base rises. Conversely when Sterling appreciates, revenues are reduced but costs
also decrease. As the Group is currently loss making, any appreciation in Sterling has a beneficial impact on the net loss.

(b) Credit risk
In common with most businesses, the Group extends credit to its customers. The credit risk on this activity is judged as low and
the Group has not experienced significant bad debt. Most clients are large blue-chip organisations and further credit checks are not
carried out before entering into commercial arrangements. Standard credit terms offered are 30 days but this can vary depending
on the commercial agreement reached. See note 16 for further disclosures on credit risk.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements3. Financial risk management continued
3.1 Group financial risk factors continued
(c) Liquidity risk
Cash flow forecasting is performed centrally on a rolling basis for the Group as a whole and the Company ensures that the
subsidiaries have sufficient cash to meet their local operational needs.

The table below analyses the Group’s non-derivative financial liabilities into relevant maturity groupings, based on the remaining
period at the balance sheet date to the contractual maturity date. The amounts disclosed in the table are the contractual
undiscounted cash flows.

As at 31 December 2019

Trade and other payables

As at 31 December 2018

Trade and other payables

Less than
1 year
£

Between 1
and 2 years
£

Between 2
and 5 years
£

Over
5 years
£

703,186

293,016

158,433

443,740

—

3.2 Capital management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide
returns for shareholders and benefits for other stakeholders. The Group considers capital to be its equity reserves, further details
of which can be found in note 17.

The Group ensures it is meeting its objectives by reviewing its key performance indicators (“KPIs”) to ensure cash consumption
and costs are controlled, revenues are in line with expectations and key customers are under contract.

There is no debt in the Group and to date no dividends have been paid.

The Company’s capital management objectives and strategy are the same as the Group’s described above.

4. Critical accounting estimates and judgements
Estimates 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.

(a) Critical accounting estimates and assumptions
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom
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.

(i) Going concern
The financial statements have been prepared on the going concern basis, which assumes that the Group will have sufficient funds
available to enable it to continue to trade for the foreseeable future. Please refer to section 1.1.1 under basis of preparation above
for more details on the judgements involved.

(ii) Share-based payments
The Group records charges for share-based payments. For option-based share-based payments management estimates certain
factors used in the option pricing model, including volatility, vesting date of options and number of options likely to vest. If these
estimates vary from actual occurrence, this will impact the value of the equity carried in reserves. Further details of the Group’s
estimation of share-based payments are disclosed in note 20.

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

5. Segment information
Management mainly considers the business from a geographic perspective since the same services are effectively being sold in every
Group entity. Therefore regions considered for segmental reporting are where the Company and subsidiaries are based, namely the UK,
the USA, India, China and Singapore. The Brazil office was closed in early 2019. The revenue is classified by where the sales were booked
not by the geographic location of the customer. For this reporting purpose the Singapore and China entities are considered together.

The only income outside of the primary business activity relates to income received from grants which is recognised in other
operating income.

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.
The chief operating decision maker, which is responsible for allocating resources and assessing performance of the operating segments,
has been identified as the steering committee that makes strategic decisions. The steering committee is made up of the Board of Directors.
There are no sales between segments. The revenue from external parties reported to the strategic steering committee is measured in
a manner consistent with that in the income statement.

The parent company is domiciled in the United Kingdom. The amount of revenue from external customers by location of the Group
billing entity is shown in the tables below.

Revenue

Turnover by geography

China and Singapore

USA

India

Brazil

Total

Turnover by category

Rendering of services

Total

Revenues from external customers by country, based on the destination of the customer

China

USA

India

Brazil

France

Ireland

Germany

Other

Total

2019
£

2018
£

776,115

160,432

139,735

38,549

24,707

177,395

109,541

40,062

14,806

74,082

1,139,538

415,886

2019
£

2018
£

1,139,538

415,886

1,139,538

415,886

2019
£

834,887

160,432

56,500

38,549

24,707

9,633

7,750

7,080

—

2018
£

198,863

109,541

—

14,806

74,083

—

7,750

6,570

4,273

1,139,538

415,886

Revenues of £765,435 (2018: £102,037) are derived from a single external customer. These revenues are generated in China but the
customers differ between 2019 and 2018. The next largest customer, based in the USA, had revenues of £80,720 (2018: £85,089).

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

5. Segment information continued
Loss before tax
The EBITDA is the loss for the year before depreciation, amortisation, interest and tax. The loss before tax is broken down by
segment as follows:

USA

India

China and Singapore

Brazil

Total EBITDA

Depreciation

Amortisation

Impairment of intangible assets

Finance income net

Loss before tax

2018

USA

India

China and Singapore

Brazil

Total

2019

USA

India

China and Singapore

Brazil

Total

Non-current assets

USA

India

China and Singapore

Brazil

Total

2019
£

2018
£

(8,261,267)

(7,450,953)

(1,970,752)

(2,306,067)

(502,768)

(716,655)

(409,365)

(940,649)

(361,328)

(516,391)

(11,505,480)

(11,930,715)

(498,411)

(149,102)

(170,053)

(1,118,862)

—

(1,230,275)

22,809

57,968

(12,151,135)

(14,370,986)

Depreciation
£

Amortisation
£

Impairment of
intangibles
£

Income tax
credit/(charge)
£

Finance
income net
£

(108,053)

(1,118,862)

(1,230,275)

79,169

(2,379)

(34,125)

(4,768)

223

—

(36,952)

—

56,132

—

1,024

217

595

(149,102)

(1,118,862)

(1,230,275)

42,217

57,968

Depreciation
£

Amortisation
£

(320,274)

(170,053)

(118)

(84,834)

(91,354)

(1,831)

—

(498,411)

(170,053)

Impairment of
intangibles
£

Income tax
credit/(charge)
£

Finance
income net
£

—

80,077

18,540

—

(26,214)

—

2,368

56,231

2019
£

—

1,772

1,236

1,261

22,809

2018
£

932,471

661,857

3,346

113,755

75,554

—

2,627

56,791

33,389

15,772

1,125,126

770,436

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 20195. Segment information continued
Loss before tax continued
The main non-current asset balances in the UK relate to right-of-use assets and leasehold improvements.

Total assets

USA

India

China and Singapore

Brazil

Total

2019
£

2018
£

19,892,997

16,158,968

475,990

378,687

570,815

—

421,647

309,061

243,169

103,270

21,318,489

17,236,115

The main asset balance in the UK is the cash balance which is used to fund the business and support the subsidiary entities.

Liabilities

USA

India

China and Singapore

Brazil

Total

6. Operating loss
The Group operating loss is stated after charging/(crediting):

Employee benefits

Depreciation of property, plant and equipment

Amortisation and impairment of intangible assets

Foreign exchange movements

Other general and administrative costs

Other operating income

2019
£

2018
£

1,657,544

1,267,135

135,577

238,072

87,795

—

162,962

182,895

41,310

5,110

2,118,988

1,659,412

Note

2019
£

2018
£

8,123,117

6,879,256

498,411

170,053

168,319

149,102

2,349,137

(41,341)

4,378,003

5,680,119

(24,421)

(171,433)

Total cost of sales, administrative expenses and other operating income

13,313,482

14,844,840

Other operating income includes income received from government grants. The Group has complied with all the conditions attached
to these grant awards.

During the years indicated the Group obtained the services from and paid the fees of the Group’s auditors as detailed below:

Audit fees

Audit related assurance services

Taxation compliance services

Total

2019
£

65,000

3,800

—

68,800

2018
£

65,000

2,000

750

67,750

Non-audit fees payable to PricewaterhouseCoopers LLP were £3,800 (2018: £2,750). The audit related assurance services relate to
a review of IFRS 16 implementation. The prior year audit related services related to a review of the QCA Code implementation.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

7. Employees
7.1 Employee benefit expense

Wages and salaries

Social security costs

Share options granted to Directors and employees

Other pension costs

Total

Group

2019
£

2018
£

Company

2019
£

2018
£

6,907,420

5,976,142

4,265,211

3,151,687

657,281

359,850

198,566

593,066

176,259

133,789

507,971

359,850

198,566

416,836

176,259

133,789

8,123,117

6,879,256

5,331,598

3,878,571

All pension costs relate to the defined contribution scheme.

The key management are considered to be the Directors of the Company. Remuneration of Directors is disclosed in the
Remuneration Report.

7.2 Average number of people employed

By activity

Average monthly numbers of persons employed (including
Directors) by the Company during the year was:

Group

Company

2019
Number

2018
Number

2019
Number

2018
Number

101

2019
£

46,436

(23,627)

22,809

2018
£

57,968

—

57,968

2019
£

239,363

170,652

2018
£

213,748

168,587

—

(142,972)

410,015

239,363

Sales and account management

Ad operations and delivery

Research and development

Marketing, product and research

Management and administration

8. Finance income and costs

Finance income

Interest on short-term deposit

Finance income

Finance costs

Interest and finance charges paid for lease liabilities

Finance costs

Net finance income

9. Investments
The amounts recognised in the Company balance sheet are as follows:

At 1 January

Additions

Impairments

Total investments at 31 December

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

9. Investments continued
The investments number above is stated after an impairment loss of £nil (2018: £142,972). The prior year impairment number related
to Mirriad Brasil Tecnologias Para Midia Ltda which was liquidated on 31 July 2019. The impairment loss was recognised in the prior
year income statement.

During the year the Company had interests in the following investments, all of which are consolidated in the Group historical financial
information. There are no capital contributions related to share-based payments. The subsidiaries as listed below have share capital
consisting solely of Ordinary Shares, which are held directly by the Group; the country of incorporation or registration is also their
principal place of business.

Name of subsidiary
or Group undertaking

Mirriad Advertising
Private Limited

Mirriad Inc.

Mirriad (Singapore) Pte. Ltd.

Registered address

Nature of business

Offices Nos. 401 & 402
Palm Spring Centre, Link Road, above Croma,
Malad (w), Mumbai-400 064

Provision of embedded
advertising into video

Country of

Proportion of
nominal value of
registration and shares and voting
rights held

operation

India

100%

4th Floor
19 W24th Street,
New York, NY 10001

8 Eu Tong Sen Street
#20–84 The Central
Singapore 059818

Provision of embedded
advertising into video

USA

100%

Provision of embedded
advertising into video

Singapore

100%

Mirriad Software Science and
Technology (Shanghai) Co. Ltd.

Rm 1328, 2nd Floor, No.148, Lane 999,
Xin Er Road, Shanghai

Provision of embedded
advertising into video

China

100%

Mirriad Limited

6th Floor, One London Wall, London
EC2Y 5EB, United Kingdom

Dormant

100%

The nominal value of issued shares for the companies is as follows:

• Mirriad Advertising Private Limited: 10,000 shares of 10 INR;

• Mirriad Inc.: 1,000 shares of 0.001 USD;

• Mirriad (Singapore) Pte. Ltd.: 25,000 shares of 1 SGD;

• Mirriad Software Science and Technology (Shanghai) Co. Ltd. registered capital is 3,600,000 CNY; and

• Mirriad Limited: 1 share of 0.01 GBP.

10. Income tax credit

Tax credit included in profit and loss

Current tax

Research and development tax credit for the year

Adjustment in respect of prior periods

Foreign tax payable

Adjustment in respect of prior periods – foreign tax

Total current tax

Deferred tax

Origination and reversal of timing differences

Total deferred tax

Tax on loss

UK corporation tax credit relates to R&D tax credits received by the Group.

2019
£

2018
£

(76,754)

(3,323)

24,809

(963)

(79,169)

—

36,952

—

(56,231)

(42,217)

—

(56,231)

(42,217)

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

10. Income tax credit continued
Reconciliation of tax credit
The tax assessed for the year is based on the standard rate of corporation tax in the UK of 19%. The differences are outlined below:

Loss before tax

Loss on ordinary activities multiplied by the standard rate of corporation tax in the UK of 19%
(2018: 19%)

Effects of:

Fixed asset timing differences

Expenses not deductible for tax purposes

Adjustments to tax credit in respect of previous periods

Adjustment in respect of prior periods – foreign tax

Enhanced R&D deduction

R&D tax credit receivable

Surrender of losses for R&D tax credit

Deferred tax not recognised on unutilised losses

Total tax credit for the year

The tax (charge)/credit relating to components of other comprehensive income is as follows:

2019
£

2018
£

(12,151,135)

(14,370,986)

(2,308,716)

(2,730,487)

304

79,540

(3,323)

(963)

(56,846)

(76,754)

3,032

41,134

—

(58,635)

(79,169)

100,575

103,739

2,209,952

2,678,169

(56,231)

(42,217)

Fair value income

Currency translation differences

Other comprehensive income

Fair value losses

Currency translation differences

Other comprehensive expense

2019

Tax (charge)/
credit
£

After tax
£

—

136,179

2018

Tax (charge)/
credit
£

After tax
£

—

(88,346)

Before tax
£

136,179

Before tax
£

(88,346)

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

10. Income tax credit continued
Deferred tax
The following tables represent deferred tax balances recognised in the consolidated balance sheet, and the movements in both the
deferred tax asset and the deferred tax liability.

There is a deferred tax liability of £346,910 (2018: £346,910) in respect of the intangible asset acquired on acquisition of the trade
and assets of Mirriad Limited in 2015, which has been immediately offset against the acquired unrecognised deferred tax asset in
relation to trading losses carried forward.

Deferred tax assets

Deferred tax liabilities

Net balances

Movements on the deferred tax asset

At 1 January

Acquisition during the year

Impact of rate changes

At 31 December

Movements on the deferred tax liability

At 1 January

Acquisition during the year

Impact of rate changes

At 31 December

2019
£

2018
£

346,910

(346,910)

—

2019
£

2018
£

346,910

—

346,910

2019
£

2018
£

(346,910)

—

(346,910)

There is an unrecognised deferred tax asset of £9,725,202 (2018: £7,239,195) in relation to the trading losses carried forward,
provisions and future exercisable shares.

Unrecognised deferred tax has been calculated at 17%, reflecting the latest enacted rate for UK deferred tax balances and the
prevailing domestic tax rate in each country for the deferred tax balances of the foreign subsidiaries.

The unrecognised deferred tax asset would be recovered against future Company taxable profits. In the opinion of the Directors,
there is insufficient evidence that the asset will be recovered; as such the deferred tax asset has not been recognised in the
financial statements.

Factors that may affect future tax charges
A change to the UK corporation tax rate was enacted as part of the Finance Act 2016, which received royal assent on 15 September 2016.
This was a reduction to the main rate of corporation tax from 19% to 17% from 1 April 2020. This rate reduction has been reflected
in the calculation of deferred tax at the balance sheet date as noted above. However, in the April 2020 budget this 2% reduction was
reversed and the main rate of corporation tax will remain at 19% from 1 April 2020. This will impact this amount going forward.

11. Loss per share
(a) Basic
Basic loss per share is calculated by dividing the loss for the year by the weighted average number of Ordinary Shares in issue during
the year. Potential Ordinary Shares are not treated as dilutive as the Group is loss making and such shares would be anti-dilutive.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

11. Loss per share continued
(a) Basic continued
Group

Loss attributable to owners of the parent (£)

Weighted average number of Ordinary Shares in issue (number)

The loss per share for the year was 8p (2018: 14p).

No dividends were paid during the year (2018: £nil).

2019

2018

(12,094,904)

(14,328,769)

150,165,094 104,124,043

(b) Diluted
Potential Ordinary Shares are not treated as dilutive as the Group is loss making and such shares would be anti-dilutive.

12. Property, plant and equipment
Group

Fixtures, fittings
and computer
equipment
£

Right-of-use
assets
£

Leasehold
improvements
£

Total
£

At 1 January 2018

Cost or valuation

Accumulated depreciation

Net book amount

Year ended 31 December 2018

Opening net book amount

Additions

Disposals

Depreciation charge

Depreciation on disposals

Closing net book amount

At 31 December 2018

Cost or valuation

Accumulated depreciation

Net book amount

Year ended 31 December 2019

Opening net book amount

365,460

(255,172)

110,288

133,663

(181,132)

(77,630)

181,036

166,225

317,991

(151,766)

166,225

—

Adjustment for change in accounting policy, see note 2.12

—

950,330

346,367

711,827

(30,781)

(285,953)

315,586

425,874

315,586

3,723

425,874

137,386

—

(181,132)

(71,472)

(149,102)

—

181,036

247,837

414,062

350,090

668,081

(102,253)

(254,019)

247,837

414,062

247,837

—

414,062

950,330

Restated opening net book amount

Additions

Disposals

Depreciation charge

Depreciation on disposals

Closing net book amount

At 31 December 2019

Cost or valuation

Accumulated depreciation

Net book amount

166,225

950,330

247,837

1,364,392

55,064

(19,598)

—

7,420

—

62,484

(19,598)

(94,732)

(330,257)

(73,422)

(498,411)

4,116

—

4,116

111,075

620,073

181,835

912,983

353,457

950,330

357,510

1,661,297

(242,382)

(330,257)

(175,675)

(748,314)

111,075

620,073

181,835

912,983

As at 31 December 2019 there were no contractual commitments to purchase any further property, plant and equipment
(2018: none).

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

12. Property, plant and equipment continued
Company

Fixtures, fittings
and computer
equipment
£

Right-of-use
assets
£

Leasehold
improvements
£

Total
£

At 1 January 2018

Cost or valuation

Accumulated depreciation

Net book amount

Year ended 31 December 2018

Opening net book amount

Additions

Disposals

Depreciation charge

Depreciation on disposals

Closing net book amount

At 31 December 2018

Cost or valuation

Accumulated depreciation

Net book amount

Year ended 31 December 2019

Opening net book amount

215,788

(151,771)

64,017

55,637

—

(38,436)

—

81,218

271,425

(190,207)

81,218

—

Adjustment for change in accounting policy, see note 2.12

—

721,888

346,367

562,155

(30,781)

(182,552)

315,586

379,603

315,586

1,655

—

379,603

57,292

—

(69,617)

(108,053)

—

247,624

328,842

348,022

619,447

(100,398)

(290,605)

247,624

328,842

247,624

—

328,842

721,888

Restated opening net book amount

Additions

Disposals

Depreciation charge

Depreciation on disposals

Closing net book amount

At 31 December 2019

Cost or valuation

Accumulated depreciation

Net book amount

81,218

31,633

(1,805)

721,888

247,624

1,050,730

—

7,420

—

39,053

(1,805)

(47,307)

(201,457)

(71,510)

(320,274)

1,805

—

1,805

65,544

520,431

183,534

769,509

301,253

721,888

355,442

1,378,583

(235,709)

(201,457)

(171,908)

(609,074)

65,544

520,431

183,534

769,509

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

13. Intangible assets
Group and Company

Cost

At 1 January 2018

Additions

At 31 December 2018

Additions

At 31 December 2019

Accumulated amortisation and impairment

At 1 January 2018

Amortisation charge

Impairment charge

At 31 December 2018

Amortisation charge

At 31 December 2019

Net book value

Cost

Internally
generated
software
development
costs
£

Patents
£

Other
£

Total
£

1,688,712

1,362,384

351,935

3,403,031

—

878,500

—

878,500

1,688,712

2,240,884

351,935

4,281,531

—

1,688,712

2,240,884

351,935

4,281,531

(1,125,808)

(401,909)

(234,624)

(1,762,341)

(422,178)

(608,700)

(87,984)

(1,118,862)

—

(1,230,275)

—

(1,230,275)

(1,547,986)

(2,240,884)

(322,608)

(4,111,478)

(140,726)

—

(29,327)

(170,053)

(1,688,712)

(2,240,884)

(351,935)

(4,281,531)

1,688,712

2,240,884

351,935

4,281,531

Accumulated amortisation and impairment

(1,547,986)

(2,240,884)

(322,608)

(4,111,478)

At 31 December 2018

Cost

140,726

—

29,327

170,053

1,688,712

2,240,884

351,935

4,281,531

Accumulated amortisation and impairment

(1,688,712)

(2,240,884)

(351,935)

(4,281,531)

At 31 December 2019

—

Intangible assets comprise two patents acquired from Mirriad Limited in 2015 which are being amortised on a straight line basis over
four years.

Other intangibles above include the technology acquired from Mirriad Limited, which has a carrying net book value of £nil
(2018: £3,316) and the Mirriad brand acquired as part of the same transaction, which has a carrying value of £nil (2018: £26,011).
These items are being amortised on a straight line basis over four years.

The internally generated software costs reflect staff time incurred on two main products for internal use which underpin the business
processes. These development costs have been offset by grant income received for the same staff costs over the year. To the extent
that work on the products reflects research or maintenance activities, such related costs have not been capitalised. The capitalised
software development costs are being amortised on a straight line basis over three years.

During the prior year management determined that the lower than expected revenue growth and the decline in market capitalisation
constituted triggering events in accordance with IAS 36, and hence an impairment of the internally generated software costs was
required. While management believes the software remains critical to the future success of the business and the software continues
to be used with the Group’s clients, the uncertainty over future cash flows resulting from slower than anticipated revenue growth meant
that management believed it was appropriate to take an impairment charge against the asset and write the carrying value down to zero.
The impairment charge was included in administrative expenses in the prior year statement of consolidated profit or loss. For the current
year management maintains the above view and as a result has taken the decision to not capitalise any development costs in 2019.

Neither the patents nor the other intangible assets were deemed to be impaired as part of this review and have now been fully
written down.

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

14. Trade and other receivables

Trade receivables – net

Other debtors

Accrued income

Intercompany balances

Prepayments

Group

2019
£

293,434

359,725

121,262

—

2018
£

92,780

516,786

56,448

—

462,718

494,057

Company

2019
£

11,553

282,119

7,190

114,478

203,512

2018
£

20,611

444,062

—

285,440

1,237,139

1,160,071

618,852

750,113

Less non-current portion: other debtors

(212,143)

(186,321)

(162,962)

Current portion

1,024,996

973,750

455,890

587,151

Trade receivables are stated after an expected credit loss reserve, as required by IFRS 9, of £37,568 (2018: £33,708). As of
31 December 2019, trade receivables of £15,773 (2018: £72,169) were past due but not impaired. These relate to one customer
for whom there is no recent history of default. The ageing history of these trade receivables is as follows:

Up to three months

Three to six months

Over six months

Total

15. Trade and other payables

Trade creditors

Current tax liabilities

Other taxation and social security

Accruals

Total

2019
£

—

6,549

9,224

2018
£

68,293

3,876

—

15,773

72,169

Group

2019
£

157,929

24,809

172,030

2018
£

286,037

36,952

158,269

967,665

1,178,154

Company

2019
£

2018
£

157,929

286,037

—

168,840

702,811

—

149,612

831,483

1,322,433

1,659,412

1,029,580

1,267,132

16. Financial instruments
The Group has the following financial instruments:

Financial assets that are debt instruments measured at amortised cost:

– Trade debtors

– Other debtors

Total

Financial liabilities measured at amortised cost:

– Trade creditors

– Lease liabilities*

– Other taxation and social security

Total

2019
£

2018
£

293,434

351,956

92,780

352,148

645,390

444,928

157,929

796,555

172,030

286,037

—

157,703

1,126,514

443,740

* See note 2.12 for details about the impact from the change in accounting policies.

None of the financial assets are considered to be impaired.

The Group has no financial assets at fair value through the income statement (2018: nil) and no financial assets that are equity
instruments measured at cost less impairment (2018: nil).

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

16. Financial instruments continued
Derivative financial instruments
The Group has no interest rate derivative financial instruments.

Interest on bank loans and overdrafts is disclosed in note 8.

Credit quality of financial assets
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings
(if available) or to historical information about counterparty default rates:

Trade receivables

Counterparties without external credit rating:

Group 1

Group 2

Group 3

Total unimpaired trade receivables

Cash at bank and short-term bank deposits:

Baa2

Baa3

Ba3

Cash in hand

Total cash and cash equivalents

Group 1 – new customers (less than six months).

Group 2 – existing customers (more than six months) with no defaults in the past.

Group 3 – existing customers (more than six months) with some defaults in the past.

17. Share capital and premium
Share premium and nominal value of share capital

2019
£

2018
£

—

293,434

—

16,342

76,438

—

293,434

92,780

18,553,726

14,908,734

272,686

52,554

212,260

—

54,792

179,810

60,105

19,091,226

15,203,441

387

479

19,091,613

15,203,920

At 1 January 2018

Proceeds from shares issued

Share issue costs

At 31 December 2018

Proceeds from shares issued

Share issue costs

At 31 December 2019

Ordinary Shares of £0.00001 each
Allotted and fully paid

At 1 January 2019

Issued during the year

At 31 December 2019

Ordinary
Shares
£

1,019

—

1,051

1,080

—

2,131

Deferred
shares
£

49,898

—

Total
share capital
£

Share
premium
£

Total
£

50,917

23,717,390

23,768,307

—

1,999,968

2,000,000

(74,166)

49,898

50,949

25,643,192

25,694,141

—

1,080

16,196,750

16,197,830

—

(907,759)

49,898

52,029

40,932,183

40,984,212

Number

105,122,717

107,985,533

213,108,250

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

17. Share capital and premium continued
Share premium and nominal value of share capital continued
In August 2019 107,985,533 Ordinary Shares were issued for 15p per share as part of a £16.2 million fundraise from new and existing
shareholders. This was split as follows:

• 26,666,666 Ordinary Shares issued to Enterprise Investment Scheme (“EIS”) investors on 1 August 2019 from the placing exercise;

• 67,870,476 Ordinary Shares issued on 2 August 2019 from the placing exercise;

• 8,108,678 Ordinary Shares issued on 2 August from an open offer to existing shareholders on the basis of one new share for

every four existing Ordinary Shares held; and

• 5,339,713 Ordinary Shares issued on 2 August 2019 as part of a rump placing.

There is a single class of Ordinary Shares. There are no restrictions on the distribution of dividends and the repayment of capital.

Deferred shares of £0.025 each
Allotted and fully paid

At 1 January 2019

Issued during the year

At 31 December 2019

Number

1,995,936

—

1,995,936

The deferred shares do not have any voting rights attached and no entitlement to receive any dividend or other distribution. On a return
of assets in a winding-up or otherwise the holders of deferred shares will only be entitled to repayment of the amounts paid up on such
shares after repayment of £10 million per Ordinary Share. The Company may, subject to appropriate shareholder approval, elect to buy
back the deferred shares at a later date for an aggregate amount of £0.01 for each holder’s total holding of deferred shares.

The share capital reserve consists of shares issued to the Group’s investors.

The number of authorised shares is uncapped.

The share premium reserve consists of amounts paid in addition to the nominal value of the Ordinary Shares, less any direct costs
and fees incurred during the investment.

The profit and loss account consists of accumulated losses.

18. Share-based payments reserve

At 1 January 2018

Share-based payments recognised as expense

At 31 December 2018

At 1 January 2019

Share-based payments recognised as expense

At 31 December 2019

Group and
Company
£

1,964,835

176,259

2,141,094

359,850

2,500,944

The cost of equity-settled share-based payments are recognised in the income statement, together with a corresponding increase in
equity in this share-based payment reserve during the vesting period. Note 20 explains the employee options schemes in more detail.

19. Retranslation reserve

At 1 January 2018

Translation loss for the year

At 31 December 2018

At 1 January 2019

Translation gain for the year

At 31 December 2019

Group
£

(190,485)

(88,346)

(278,831)

136,179

(142,652)

The other reserve contains the translation losses for the year which result from the revaluation of subsidiary opening net assets
and reserves. Such translation movements are recorded in the statement of comprehensive income and this reserve.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements20. Share-based payments
Certain employees participate in the key employee share option scheme, which provides additional remuneration for those employees
who are key to the operations of the Group. In accordance with IFRS 2 “Share-based payments” the cost of the equity-settled
transactions is measured by reference to their fair value at the date at which they are granted. Fair value is determined using the
Black-Scholes model. The cost of equity-settled transactions is recognised over the period until the award vests. No expense is
recognised for awards that do not ultimately vest. At each reporting date, the cumulative expense recognised for equity-based
transactions reflects the extent to which the vesting period has expired and the number of awards that, in the opinion of the
Directors at that date, will ultimately vest.

The cost of equity-settled share-based payments are recognised in the income statement, together with a corresponding increase
in equity during the vesting period – please see note 18 for details of the share-based payment reserve. During the 12 months ended
31 December 2019, the Group recognised a share-based payment expense of £359,850 (2018: £176,259). The charge is included
within administrative expenses.

The Company grants share options under an Unapproved Share Option Scheme (the “Unapproved Scheme”) and under its tax
efficient EMI Option Scheme (the “EMI Scheme”). More details on the two schemes can be found below.

Unapproved Scheme
Under the Unapproved Scheme, options are granted to non-UK-based employees or UK-based employees who have exceeded their
EMI limits, at an exercise price deemed to be market value of the shares. In general, for unapproved options granted, one-third are
exercisable on the first anniversary of the grant, a further third are exercisable on the second anniversary of the grant and the remainder
are exercisable three years after the date of grant. All vested options expire 10 years after the date of grant.

Of the options granted in 2018, there were some exceptions to the general scheme criteria as follows:

• 330,000 options have a performance related element and can only be exercised if revenue targets are met.

• 2,268,068 options vest over four years instead of three, with one-third exercisable on the second anniversary of the grant,
a further third exercisable on the third anniversary of the grant and the remaining amount exercisable four years after the
date of grant. These options can only be exercised if market performance conditions are met.

• 1,269,121 options were granted at nominal value rather than market value.

• In the year ended 31 December 2019, the Company granted 690,000 (2018: 4,092,189) share options under the Unapproved Scheme.

No unapproved options were exercised during the year (2018: nil).

EMI Scheme
Under the EMI Scheme options are granted to UK-based employees at a fair value. In general, for options granted, one-third
are exercisable on the first anniversary of the grant, a further third are exercisable on the second anniversary of the grant and the
remainder are exercisable three years after the date of grant. All vested options expire 10 years after the date of grant. The only
exception were options issued in 2015 which vested immediately. Employees are not entitled to dividends until the share options
are exercised. Vesting of the options is subject to continued employment within the Group.

In the year ended 31 December 2019, the Company granted 330,000 (2018: 2,814,880) share options under the EMI Scheme.

No EMI options were exercised during the year (2018: nil).

Movements in the number of share options outstanding and their related weighted average exercise prices are as follows:

2019

2018

Weighted average
exercise price in
£ per share option

Share options
Number

Weighted average
exercise price in
£ per share option

Share options
Number

0.17

0.06

2,814,880

330,000

(0.29)

(828,420)

—

0.17

2,814,880

—

0.12

2,316,460

0.17

2,814,880

0.40

0.06

8,469,347

690,000

0.54

0.24

5,144,157

4,092,189

(0.52)

(1,460,375)

(0.49)

(766,999)

0.35

7,698,972

0.40

8,469,347

EMI Scheme

Outstanding at 1 January

Granted

Forfeited

At 31 December

Unapproved Scheme

Outstanding at 1 January

Granted

Forfeited

At 31 December

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

20. Share-based payments continued
EMI Scheme continued
Out of the 2,316,460 outstanding EMI Scheme options (2018: 2,814,880), 662,124 options (2018: nil) were exercisable.
The weighted average exercise price of the outstanding share options under the EMI Scheme at 31 December 2019 was
£0.12 (2018: £0.17).

Out of the 7,698,972 outstanding Unapproved Scheme options (2018: 8,469,347), 3,819,823 options (2018: 3,415,760)
were exercisable. The weighted average exercise price of the outstanding share options under the Unapproved Scheme
at 31 December 2019 was £0.35 (2018: £0.40).

Share options outstanding at the end of the year have the following expiry date and exercise price:

Grant-vest

2015–18

2016–19

2017–20

2018–21

2018–22

2018–21

2019–22

Total

Scheme

Expiry date

Unapproved

20 Aug 2025

Unapproved

26 Sep 2020

Unapproved

26 Sep 2020

Unapproved

16 Dec 2026

Unapproved

19 Jun 2027

Unapproved

16 Oct 2027

EMI

1 Jun 2029

Unapproved

1 Jul 2028

EMI

1 Oct 2028

Exercise price in
£ per share options

Share options

2019

2018

0.30

0.62

0.35

0.345

0.30

732,836

253,576

979,836

732,836

253,576

1,469,753

1,280,535

1,440,327

—

225,000

63,917

—

255,666

225,000

63,917

555,000

788,420

833,333

0.00001

833,333

Unapproved

1 Oct 2028

0.00001

1,269,121

Unapproved

1 Oct 2028

EMI

9 Nov 2028

16 May 2029

Unapproved

16 May 2029

0.35

0.195

0.0625

2,268,068

1,089,210

1,129,210

330,000

690,000

—

10,015,432

11,284,227

The fair values were estimated using the Black-Scholes option pricing model. The weighted average fair value of the options granted
under the EMI Scheme during the year under this model was £0.03 per option (2018: £0.16). The weighted average fair value of the
options granted under the Unapproved Scheme during the year under this model was £0.03 per option (2018: £0.16). The principal
assumptions underlying the valuation of the options granted during the year at the date of grant are as follows:

EMI Scheme

Weighted average share price at grant date

Weighted average exercise price at grant date

Expected volatility

Expected life

Risk-free rate

Unapproved Scheme

Weighted average share price at grant date

Weighted average exercise price at grant date

Expected volatility

Expected life

Risk-free rate

2019

2018

£0.06

59.4%

£0.26

£0.17

38.1%

6.5 years

1.52%

1.87%

£0.06

59.4%

£0.29

£0.24

36.3%

6.5 years

1.52%

1.85%

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

21. Cash used in operations

Loss for the financial year

Adjustments for:

Tax on loss on ordinary activities

Interest income

Lease interest costs

Operating loss

Amortisation and impairment of intangible assets

Amortisation of right-of-use assets

Depreciation of tangible assets

Write down of investment in subsidiary

Loss/(profit) on disposal of tangible assets

Bad debts written off/(reversed)

Share-based payment charge

Adjustments to tax credit in respect
of previous periods

Foreign exchange variance

(Increase)/decrease in debtors

Decrease in creditors

Cash flow used in operations

Note

Group

2019
£

2018
£

Company

2019
£

2018
£

(12,094,904)

(14,328,769)

(12,037,026)

(14,251,608)

(56,231)

(46,436)

23,627

(42,217)

(57,968)

—

(80,077)

(44,664)

26,124

(79,169)

(56,132)

—

(12,173,944)

(14,428,954)

(12,135,643)

(14,386,909)

170,053

2,349,137

330,257

168,154

—

16,067

3,859

—

149,102

—

(1,754)

20,423

170,053

201,457

118,817

—

(100)

(56)

2,349,137

—

108,053

142,972

—

5,244

359,850

176,259

359,850

176,259

4,286

136,179

(101,350)

—

43,060

106,740

3,323

—

126,015

(65,789)

(135,509)

(386,421)

(68,339)

(459,808)

(11,222,098)

(11,972,408)

(11,224,623)

(12,130,841)

22. Capital and other commitments
The Group had no capital and other commitments as at 31 December 2019 or for the year ended 31 December 2018.

23. Related party transactions
The Group is owned by a number of investors, the largest being IP2IPO Portfolio (GP) Limited (as general partner for IP2IPO Portfolio LP),
which owns approximately 16% of the share capital of the Company. Accordingly there is no ultimate controlling party.

During the year the Company had the following significant related party transactions which were carried out at arm’s length.
No guarantees were given or received for any of these transactions:

Transactions with Directors
As part of the fundraise in August 2019 the following Directors purchased Ordinary Shares in the Company at a cost of £0.15 per share:

Director

John Pearson

Stephan Beringer

David Dorans

Dr Mark Reilly

Alastair Kilgour

Bob Head

Number of shares

166,666

333,333

13,333

33,333

233,333

133,333

Transactions with other related parties
IP2IPO Limited – a company which shares a parent company with IP2IPO Portfolio (GP) Limited, a major shareholder in the Group,
and which also appoints a Director of the Group charged Mirriad Advertising plc for the following transactions during the year:
(1) £20,000 for the services of Dr Mark Reilly as a Director during the year. £3,333 of this amount was invoiced and unpaid as at
31 December 2019. These outstanding amounts were paid on 2 January 2020 and 2 March 2020; (2) £12,000 for the services of
the Company Secretary during the year. £3,000 of this amount was invoiced and unpaid as at 31 December 2019. This outstanding
amount was paid on 2 March 2020; (3) £757 for event hire and refreshments; and (4) £118 for travel costs related to Dr Mark Reilly.
£68 of this amount was invoiced and unpaid as at 31 December 2019, and was paid on 2 March 2020.

Mirriad Advertising plc Annual report and accounts 2019

Notes to the consolidated financial statements continuedFor the year ended 31 December 2019

23. Related party transactions continued
Transactions with other related parties continued
Top Technology Ventures Limited – a company which shares a parent company with IP2IPO Portfolio (GP) Limited, a major shareholder
in the Group, charged Mirriad Advertising plc for the following transaction during the year: (1) £9,498 attendance and travel costs for
an employee’s attendance at IP Group events in China.

Parkwalk Advisors Limited – a company which shares a parent company with IP2IPO Portfolio (GP) Limited, a major shareholder
in the Group, charged Mirriad Advertising plc for the following transactions during the year: (1) £20,000 for the services of Alastair
Kilgour as a Director during the year. £1,667 of this amount was accrued and unpaid as at 31 December 2019, but was subsequently
paid on 17 January 2020.

All the related party transactions disclosed above were settled by 31 December 2019 except where stated.

During the year ended 31 December 2019, the Company entered into transactions with its subsidiary companies for working capital
purposes, which net off on consolidation – these have not been shown above.

The Directors have authority and responsibility for planning, directing and controlling the activities of the Group and they therefore
comprise key management personnel as defined by IAS 24 “Related party disclosures”. Remuneration of Directors and senior
management is disclosed in the Remuneration Report.

24. Lease commitments
The Group leases office space under a mixture of short-term licensed deals and longer-term operating leases, expiring within one to
three years. From 1 January 2019, the group has recognised right-of-use assets for these leases, except for short-term and low-value
leases, see notes 2.11 and 2.12 for further information. The future minimum lease payments under non-cancellable operating leases
are as follows:

Group

No later than one year

Later than one year and no later than five years

Later than five years

Total

2019
£

—

2018
£

376,055

701,633

—

1,077,688

25. Events after the reporting period
In early 2020 the existence of a new coronavirus (COVID-19) was confirmed. The virus had an immediate impact on the volume
of business transacted with Tencent in China but no impact on revenues or cash as the Company has a guaranteed revenue stream
with Tencent. The virus subsequently spread to all the markets in which the Company operates. The scale and duration of these events
remain uncertain and could impact both revenue growth and cashflow. The Directors will continue to actively review the Company’s
cost base and take steps to preserve cash to ensure longevity throughout this period of significant uncertainty. The assessment of the
ability of the Group to continue as a going concern is disclosed in note 1.1.1.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsNotice of Annual General Meeting

This document is important and requires your immediate attention.

If you are in any doubt as to any aspect of the proposals referred to in this document or as to the action you should take, you should
seek your own advice from a stockbroker, solicitor, accountant or other professional adviser who, if you are taking advice in the
United Kingdom, is duly authorised under the Financial Services and Markets Act 2000, or an appropriately authorised independent
financial adviser if you are in a territory outside the United Kingdom.

If you have sold or otherwise transferred all of your shares in the Company, please pass this document together with the accompanying
documents to the purchaser or transferee, or to the person who arranged the sale or transfer so they can pass these documents to
the person who now holds the shares.

Mirriad Advertising plc
(incorporated and registered in England and Wales under number 09550311)

Notice of Annual General Meeting

Notice of the Annual General Meeting of Mirriad Advertising plc (the “Company”) to be held at the Company’s offices, 96 Great Suffolk Street,
London, SE1 0BE at 10.00 a.m. on 15 June 2020 is set out in this document.

Please complete and submit a proxy form in accordance with the instructions printed on the enclosed form. The proxy form must be
received not less than 48 hours before the time of the holding of the Annual General Meeting.

COVID-19 update
The evolving COVID-19 situation and the related Government guidelines will clearly impact the ability of the members of the
Company (the “Shareholders”) to attend our Annual General Meeting (the “AGM”). In normal circumstances, the board of directors
of the Company (the “Board”) values the opportunity to meet shareholders in person. However, the Board fully supports the
Government prohibition on public gatherings of more than two people and its advice not to travel unless essential for work purposes.
It is the Company’s intention to proceed with holding the AGM on 15 June 2020 at 10.00am with the minimum quorum of
shareholders present in order to conduct the business of the meeting (being two shareholders). Whilst the current guidance
remains in place, no other shareholders will be permitted to physically attend the meeting. Any shareholder who attempts to
attend the meeting will be refused entry.

Instead of attending this year’s AGM, Shareholders are asked to exercise their votes by submitting their proxy electronically
or by post, as explained below. Shareholders are strongly encouraged to only appoint the ‘Chairman of the meeting’ as proxy, as
no other proxy will be permitted to attend the meeting. Should a shareholder have a question that they would have raised at the
meeting, we ask that they send it by email at least two business days prior to the meeting to mirriadplc@mirriad.com. The Company
will endeavour to publish these questions and the Company’s responses on the Company’s website at https://www.mirriadplc.com/
investor-relations/shareholder-information.

The Board will keep these AGM arrangements under review and will update shareholders via the Regulatory News Service as appropriate,
with any such announcements to be uploaded to the Company’s website at https://www.mirriadplc.com/investor-relations/
shareholder-information. The Company encourages shareholders to check its website regularly for the latest information on
the arrangements for the AGM.

Mirriad Advertising plc Annual report and accounts 2019

NOTICE IS HEREBY GIVEN that the ANNUAL GENERAL MEETING of Mirriad Advertising plc (the “Company”) will be held at the
Company’s offices, 96 Great Suffolk Street, London, SE1 0BE at 10.00 a.m. on 15 June 2020 for the purposes of considering and,
if thought fit, passing the following resolutions of which resolutions 1 to 8 (inclusive) will be proposed as Ordinary resolutions
and resolution 9 will be proposed as a Special resolution.

Ordinary business
1.

To receive and consider the Directors’ Report, the audited Financial Statements and Independent Auditors’ Report for the year
ended 31 December 2019.

2. To receive and approve the remuneration report contained with the report and accounts for the year ended 31 December 2019.

To re-appoint PricewaterhouseCoopers LLP as auditors of the Company to hold office from the conclusion of this Annual General
Meeting until the conclusion of the next Annual General Meeting of the Company at which accounts are laid before the members
of the Company.

4. To authorise the directors of the Company (“Directors”) to fix the remuneration of the auditors.

5. To elect Mr. Robert Head as a Director of the Company in accordance with the articles of association of the Company.

To re-elect Mr. Mark Reilly as a Director of the Company who retires in accordance with the articles of association
of the Company.

To re-elect Mr. Alastair Kilgour as a Director of the Company who retires in accordance with the articles of association
of the Company.

Special business
8.

That, in substitution for any equivalent authorities and powers granted to the Directors prior to the passing of this resolution,
the Directors be and are hereby generally and unconditionally authorised for the purposes of Section 551 of the Companies Act 2006
(“Act”) to exercise all the powers of the Company to:

(a) allot shares in the Company and to grant rights to subscribe for or to convert any security into such shares in the Company

(such shares, and rights to subscribe for or to convert any security into shares of the Company being “relevant securities”)
up to an aggregate nominal amount of £710.29 (such amount to be reduced by the nominal amount of any allotment or grants
made under paragraph (b) below in that are in excess of £710.29; and further

(b) allot equity securities of the Company (as defined in Section 560 of the Act) up to an aggregate nominal amount of £1,420.58
(such amount to be reduced by the nominal amount of any allotment or grants made under paragraph (a) above) in connection
with an offer by way of a rights issue:

(i)

in favour of holders of ordinary shares in the capital of the Company, where the equity securities respectively attributable
to the interests of all such holders are proportionate (as nearly as practicable) to the respective number of ordinary shares
in the capital of the Company held by them; and

(ii) to holders of any other equity securities as required by the rights of those securities or as the Directors otherwise

consider necessary,

but subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to
fractions of such securities, the issue, transfer and/or holding of any securities in certificated form or in uncertificated form,
the use of one or more currencies for making payments in respect of such offer, any such shares or other securities being
represented by depositary receipts, treasury shares or any legal, regulatory or practical problems arising under the laws
of, or the requirements of any regulatory body or any stock exchange in, any territory or any other matter whatsoever,

provided that (i) unless previously revoked, varied or extended, such authorities shall expire on the earlier of the conclusion
of the Company’s next Annual General Meeting and the date falling 15 months after the date of the passing of this resolution,
and (ii) before such expiry the Company may make any offer or agreement which would or might require relevant securities to
be allotted after such expiry and the Directors may allot such relevant securities pursuant to any such offer or agreement as if
the authority conferred by this resolution 8 had not expired.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statements

Notice of Annual General Meeting continued

Special business continued
9.

That, in substitution for any equivalent authorities and powers granted to the Directors prior to the passing of this resolution, the
Directors be and are hereby generally empowered to allot equity securities (as defined in section 560 of the Act) of the Company
wholly for cash pursuant to the authority of the Directors under Section 551 of the Act conferred by resolution 8 above (in accordance
with Sections 570(1) of the Act) and/or by way of a sale of treasury shares (in accordance with Section 573 of the Act), in each
case as if Section 561(1) of the Act did not apply to any such allotment provided that:

(a) such power shall be limited to:

(i)

the allotment of equity securities in connection with an offer of, or invitation to apply for, equity securities (but in the
case of the authority granted under paragraph (b) of resolution 8, by way of a rights issue only):

(A) in favour of holders of ordinary shares in the capital of the Company, where the equity securities respectively

attributable to the interests of all such holders are proportionate (as nearly as practicable) to the respective number
of ordinary shares in the capital of the Company held by them; and

(B) to holders of other equity securities as required by the rights of those securities or as the Directors otherwise

consider necessary,

but subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to
fractions of such securities, the issue, transfer and/or holding of any securities in certificated form or in uncertificated
form, the use of one or more currencies for making payments in respect of such offer, any such shares or other securities
being represented by depositary receipts, treasury shares or any legal, regulatory or practical problems arising under the
laws of, or the requirements of any regulatory body or any stock exchange in, any territory or any other matter
whatsoever; and

(ii) the allotment of equity securities, other than pursuant to sub-paragraph (i) above, up to an aggregate nominal amount

of £213.10.

(b) unless previously revoked, varied or extended, such authorities shall expire on the earlier of the conclusion of the Company’s
next Annual General Meeting and the date falling 15 months after the date of the passing of this resolution except that the
Company may at any time before such expiry make an offer or agreement which would or might require relevant securities to
be allotted after such expiry and the Directors may allot such relevant securities in pursuance of such an offer or agreement
as if this authority had not expired.

By order of the Board

Hannah Coote
Company Secretary
20 May 2020

Registered office
6th Floor
One London Wall
London
EC2Y 5EB

Registered in England and Wales No. 09550311

Mirriad Advertising plc Annual report and accounts 2019

Explanatory notes to the resolutions
Resolution 1 – Receiving the account and reports
All public limited companies are required by law to lay their annual accounts before a general meeting of the Company, together
with the directors’ reports and auditors’ reports on the accounts. At the Annual General Meeting, the Directors will present these
documents to the members for the financial year ended 31 December 2019.

Resolution 2 – Directors’ remuneration report
The Company is required to put an ordinary resolution to members approving the report at the meeting at which the Company’s
report and accounts for that year are laid.

Resolution 3 – Re-appointment of auditors
This resolution concerns the re-appointment of PricewaterhouseCoopers LLP as Auditors until the conclusion of the next general
meeting at which accounts are laid, that is, the next Annual General Meeting.

Resolution 4 – Auditors’ remuneration
This resolution authorises the Directors to fix the Auditors’ remuneration.

Resolution 5 – Election of Robert Head
This resolution concerns the election of Robert Head, who was appointed to the Board since the last Annual General Meeting
and is standing for re-election in accordance with article 84 of the Company’s articles of association.

Resolutions 6-7 – Re-election of Mark Reilly and Alastair Kilgour
These resolutions concern the re-election of Mark Reilly and Alastair Kilgour who are retiring in accordance with article 88.1(d)
of the Company’s articles of association.

Resolution 8 – Directors’ power to allot shares
This resolution grants the Directors authority to allot shares in the capital of the Company and other relevant securities up to an
aggregate nominal value of £710.29, representing approximately 33.33% of the nominal value of the issued ordinary share capital
of the Company as at 19 May 2020, being the latest practicable date before publication of this notice. In addition, in accordance with
guidelines issued by the Investment Association, this resolution grants the Directors authority to allot further equity securities up to
an aggregate nominal value of £1,420.58, representing approximately 66.66% of the nominal value of the issued ordinary share capital
of the Company as at 19 May 2020 being the latest practicable date before publication of this notice. This additional authority may
be only applied to fully pre-emptive rights issues.

Unless revoked, varied or extended, this authority will expire at the conclusion of the next Annual General Meeting of the Company
or the date falling 15 months from the passing of the resolution, whichever is the earlier.

Resolution 9 – Directors’ power to issue shares for cash
This resolution authorises the Directors in certain circumstances to allot equity securities for cash other than in accordance with
the statutory pre-emption rights (which require a company to offer all allotments for cash first to existing shareholders in proportion
to their holdings). The relevant circumstances are either where the allotment takes place in connection with a rights issue or other
pre-emptive issue or the allotment is limited to a maximum nominal amount of £213.10, representing approximately 10% of the nominal
value of the issued ordinary share capital of the Company as at 19 May 2020 being the latest practicable date before publication
of this notice. Unless revoked, varied or extended, this authority will expire at the conclusion of the next Annual General Meeting
of the Company or 15 months after the passing of the resolution, whichever is the earlier.

The Company may hold any shares it buys back “in treasury” and then sell them at a later date for cash rather than simply cancelling
them. Any such sales are required to be made on a pre-emptive, pro-rata basis to existing shareholders unless shareholders agree
by special resolution to disapply such pre-emption rights. Accordingly, in addition to giving the Directors power to allot unissued
ordinary shares on a non-pre-emptive basis, resolution 9 will also give Directors power to sell ordinary shares held in treasury on
a non-pre-emptive basis, subject always to the limitations noted above.

The Directors consider that the power proposed to be granted by resolution 9 is necessary to retain flexibility, although they do not
have any intention at the present time of exercising such power.

Unless revoked, varied or extended, the authorities conferred by resolutions 9 will expire at the conclusion of the next Annual General
Meeting of the Company or 15 months after the passing of the resolution, whichever is the earlier.

Mirriad Advertising plc Annual report and accounts 2019

Strategic reportCorporate governanceFinancial statementsNotice of Annual General Meeting continued

Notes to Notice of Annual General Meeting
The following notes remain subject to Government restrictions that may be in place at the time of the AGM arising from the
COVID-19 situation.

Members are strongly encouraged to appoint the Chairman of the meeting as a proxy to exercise all or any of their rights to
attend and to speak and vote on their behalf at the meeting. A proxy form which may be used to make such appointment and
give proxy instructions accompanies this notice. If you do not have a proxy form and believe that you should have one, or if you
require additional forms, please contact the Company’s registrars on 0370 702 0150. Calls cost 12 to 14p per minute plus your
phone company’s access charge. Calls outside the United Kingdom will be charged at the applicable international rate. They are
open between 8.30am and 5.30pm, Monday to Friday excluding public holidays in England and Wales.

To be valid, the proxy form must be completed and lodged, together with the original power of attorney or other authority (if any)
under which it is signed, or a duly certified copy of such power or authority, with the Company’s registrars, Computershare Investor
Services plc, to Computershare Investor Services Plc, The Pavilions, Bridgwater Road, Bristol BS99 6ZY or in accordance with the
replied paid details, not less than 48 hours before the time appointed for holding the Annual General Meeting.

To be entitled to vote at the Annual General Meeting (and for the purpose of the determination by the Company of the votes they
may cast), members must be registered in the Register of Members of the Company at the close of business on 11 June 2020
(or, if the Annual General Meeting is adjourned, such time being not more than 48 hours prior to the time fixed for the adjourned
meeting). Changes to the Register of Members after the relevant deadline shall be disregarded in determining the rights of any
person to vote at the Annual General Meeting.

As at 19 May 2020 (being the last business day prior to the publication of this notice of meeting) the Company’s issued share
capital consisted of 213,108,250 ordinary shares in the capital of the Company, carrying one vote each. Therefore, the total
voting rights in the Company as at 19 May 2020 were 213,108,250.

CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so by
using the procedures described in the CREST Manual. CREST Personal Members or other CREST sponsored members, and those
CREST members who have appointed a service provider(s), should refer to their CREST sponsor or voting service provider(s), who
will be able to take the appropriate action on their behalf.

In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message
(a “CREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear UK and Ireland Limited’s
specifications, and must contain the information required for such instruction, as described in the CREST Manual (available via
www.euroclear.com/CREST). The message, regardless of whether it constitutes the appointment of a proxy or is an amendment
to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the
issuer’s agent (CREST ID No. 3RASA) by 10am on 11 June 2020. For this purpose, the time of receipt will be taken to be the time
(as determined by the time stamp applied to the message by the CREST Application Host) from which the issuer’s agent is able
to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to
proxies appointed through CREST should be communicated to the appointee through other means.

CREST members and, where applicable, their CREST sponsors, or voting service providers should note that Euroclear UK
and Ireland Limited does not make available special procedures in CREST for any particular message. Normal system timings and
limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member
concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed a voting service
provider, to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that
a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where
applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual
concerning practical limitations of the CREST system and timings.

Mirriad Advertising plc Annual report and accounts 2019

Notes to Notice of Annual General Meeting continued
8.

The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the
Uncertificated Securities Regulations 2001.

Any corporation which is a member can either (i) appoint a proxy (described in notes 1 to 3 above) or (ii) appoint one or more
corporate representatives, who may exercise on its behalf all of its powers as a member provided they do not do so in relation
to the same shares. Members considering the appointment of a corporate representative should check their own legal position,
the Company’s articles of association and the relevant provision of the Companies Act 2006.

10. A copy of this notice, and other information required by section 311A of the Act, can be found at mirriadplc.com/investor-relations.

11. You may not use any electronic address provided either in the Notice of Annual General Meeting or any related documents

(including the Chairman’s letter and proxy form) to communicate for any purposes other than those expressly stated.

12. Voting on all resolutions will be conducted by way of a poll. This is a more transparent method of voting as shareholders’ votes

are counted according to the number of shares registered in their names.

13. Subject to COVID-19 restrictions, the following documents will be available for inspecting during normal business hours

at the registered office of the Company from the date of this notice until the time of the meeting. They will also be available
for inspection at the place of the meeting from at least 15 minutes before the meeting until it ends.

(a) Copies of the service contracts of the Executive Directors of the Company.

(b) Copies of the letters of appointment of the Non-executive Directors of the Company.

Mirriad Advertising plc Annual report and accounts 2019

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