Cyan : Annual Report ( Annual Report 2023)

2023

Annual Report

Network Security

Going beyond

connection

Endpoint Security

Reaching full

digital potential

Child Protection

Digital safety from day one

With our easy-to-implement, network- based security solutions, we enable telecommunications providers to effortlessly protect their end users online.

Our device-based security solutions can be implemented in any end-customer app or as a standalone app. Fully branded in the style of our customers. For convenient digital security everywhere.

Using new technologies is essential for the young generation to fully realize their potential. We provide the secure digital environment to make this possible.

Contents

Contents

This annual report is a convenience translation of the German original.

The auditor's report is solely issued on the German original.

Please find the German original under the following link:

• ir.cyansecurity.com

Contents	4
Letter to the Shareholders	6
Report of the Supervisory Board	9
cyan-share	14
Management Report	18
Group Fundamentals	19
Economic Report	24
Risk and Opportunity Report	30
Forecast	35
Financial Statements	36
Statement of comprehensive income	37
Balance Sheet	39
Cash flow statement	41
Consolidated statement of changes in equity	42
Notes to the Financial Statements	43
Information about the Company	44
Accounting Reporting	44
Segment Reporting	61
Notes to the Statement of Comprehensive Income	66
Comments on the Consolidated Balance Sheet	74
Notes to the Consolidated Cash Flow Statement	89
Financial Instruments and Risk Management	90
Other Explanations	95
Independent Auditor's Report	98
Further Information	103
Disclaimer	104
Imprint	105

5

Letter to the Shareholders

Letter to the Shareholders

Dear Shareholders,

We are proud that our proprietary software and technology protects our end customers from potential internet threats such as phishing, malware and identity theft at all times. We accomplish this important task through our proprietary threat intelligence platform, which can be used network-integrated via telecom operators and device-based via app. With a leaner and more agile team, our goal is to further expand our partners in the telecommunications sector and to penetrate new business areas such as insurances to further protect the digital lives of our partners' end customers with our solutions.

Focus on the core business cybersecurity

With the sale of our BSS/OSS (Business Support System / Operations Support System) segment at the end of 2023, cyan is now fully focused on its core business cyberse- curity. Therefore, we sold the BSS/OSS segment under the i new brand to Compax International Holding GmbH (Compax). The operations of i-new Unified Mobile Solutions GmbH were transferred as part of an asset deal and the subsidiaries belonging to the business segment were sold as part of a share deal. The transaction significantly streamlined the cyan Group. Operating costs reduce by around 60%, whereas the segment was responsible for only 45% of revenue in 2023. In addition, we will use the proceeds from the sale to invest in product development and in the expansion and improvement of our AI-based algorithms in order to further consolidate our strengths. We have agreed a strategic partnership with Compax for technology and sales ac- tivities. The customer landscape of both groups is highly interconnected. In particular, we will support Compax with the customers that have been transferred and are already in the bidding process. Conversely, Compax will place our cybersecurity products in their sales discussions with telecommunications providers.

Significant gains among subscribers (end customers)

In the cybersecurity segment, we recorded a pleasing 71% growth in subscribers in 2023. This trend is also continuing in the first few months of 2024 and gives us a good starting point for the new fiscal year. The growth in the past financial year is due to the fact that we were able to further expand our cooperation with the Orange Group and launch a major product upgrade with T-Mobile Poland. In 2023, we also gained a new partner in MTEL, which offers our products integrated into tariffs and has become a major MVNO (Mobile Virtual Network Operator) in the entire DACH region. The German market in particular offers significant growth potential for the future. In ad- dition, we have already announced our collaboration with Orange Spain, another major customer from the Orange Group, in the current year 2024. Overall, we want to secure our long-term success and look forward to keeping you up to date on our further progress.

Growth and figures

We were able to significantly increase the particularly important part of revenue, recurring revenue in the Cybersecurity segment, by 41% compared to 2022. Due to the sale of the BSS/OSS segment at the end of 2023, the segment will be removed from the balance sheet and income statement as a discontinued operation in accordance with IFRS 5 to ensure comparability. After the spin-off, consolidated operating revenue in 2023 amounts to EUR 4.7 million, which is therefore fully attributed to the Cybersecurity segment. This means that cyan was able to increase its operating revenue in the segment by 23% (2022 Cybersecurity segment: EUR 3.8 million). The difference in increase in revenue and recurring revenue is due to higher implementation revenues in 2022. In order to invest in our sustainable growth, we carried out three

7

Letter to the Shareholders

capital increases and issued a convertible bond in the 2023 financial year, all of which were fully signed. This is a clear vote of confidence from our investors, for which we would like to express our sincere thanks.

Outlook

Thanks to the proceeds from the sale of the BSS/OSS segment and the steady growth in recurring revenue, no further capital increase is currently planned for operations in the future. In the first months of 2024, we initiated a strategy program with which we will achieve improvements in the areas of product, markets, internal processes and administration. This will be implemented by our partially new and, above all, leaner team. A cornerstone on the product side in our core market OnNet is an improved product under the name OnNet Core, which enables much faster implementation, allowing our partners to plan for faster sales. On the market side, we will penetrate new industries, such as the insurance sector, primarily with technology and product partnerships using our end device-based solution and the SDK (Software Development Kit) in order to protect their end customers from digital threats. We are currently developing WeProtect, a product that will be offered as bundled cyber and insurance protection together with the insurtech company wefox in cooperation with Allianz Partners. Most recently, we have already initiated internal process optimizations with the aim of further streamlining the Group structure from 16 to three companies, reducing costs through external service providers and introducing new internal financial reporting. In addition, we will increasingly report on further progress in our business via corporate news, the press and social media in 2024.

As a dynamic company, we are fully focused on our core business Cybersecurity, where we are on an international growth path with a strong proprietary technology.

Acknowledgement

Finally, we would like to thank our shareholders, employees, customers and suppliers for their continued support and co-operation. We look forward to making continuous progress towards our goals with you.

Yours sincerely,
The Management Board of cyan AG	Munich, May of 2024

Thomas Kicker	Markus Cserna
CEO	CTO

8

Report of the

Supervisory Board

Report of the Supervisory Board

Dear Shareholders,

In the 2023 financial year, the Supervisory Board of cyan AG duly and fully performed the duties incumbent upon it in accordance with the law and the Articles of Associa- tion. It dealt regularly and in detail with the situation and development of the com- pany. To this end, the Supervisory Board regularly consulted with the company's Management Board and carefully monitored its activities. The Supervisory Board not only monitored but also supported the Management Board; in particular, the individual members of the Supervisory Board were available to the members of the Management Board for a regular exchange of ideas.

The Management Board informed the Supervisory Board cyclically, promptly and comprehensively in written and verbal form about the key aspects of the company and about current issues (see list of key topics below). Where the approval of the Supervisory Board was required by law, the articles of association or the rules of procedure for management decisions or measures, the Supervisory Board was involved in the process, in some cases in the form of written circular resolutions.

Composition of the Supervisory Board

There were changes to the Supervisory Board in 2023.

Ms Alexandra Reich resigned from the Supervisory Board in March 2023. Mr Markus Messerer was appointed to the Supervisory Board by the Munich Registry Court on 31 March 2023 and elected to the company's Supervisory Board at the 2023 Annual General Meeting for the period until the end of the Annual General Meeting that approves the actions of the Supervisory Board for the 2027 financial year.

Mr Lucas Prunbauer, who has been a member of the company's Supervisory Board since 14 November 2018, was re-elected at the 2023 Annual General Meeting, also for the period until the end of the Annual General Meeting that resolves on the discharge of the Supervisory Board for the 2027 financial year.

Mr Stefan Schütze, who had been a member of the company's Supervisory Board since 19 January 2018, did not stand for re-election for a further term of office at the 2023 Annual General Meeting, meaning that Mr Alexander Singer was elected to the company's Supervisory Board, also for the period until the end of the Annual General Meeting that resolves on the formal approval of the actions of the Supervisory Board for the 2027 financial year.

Until the end of the 2023 Annual General Meeting, Mr Stefan Schütze was Chairman of the company's Supervisory Board and Mr Lucas Prunbauer was his deputy. Immediately after this Annual General Meeting, on 10 July 2023, Mr Alexander Singer was elected Chairman of the company's Supervisory Board and Mr Lucas Prunbauer was elected Deputy Chairman.

The Supervisory Board would like to thank Ms Alexandra Reich and Mr Stefan Schütze for their valuable work on the Supervisory Board.

Meetings and resolutions

A total of nineteen Supervisory Board meetings were held (once three meetings on the same day, twice two meetings on the same day) on the following dates

• 26 January 2023
• 16 February 2023

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