globo plc ( and services to the corporate, public and ...significant partnership agreement with...

GLOBO PLC (LSE-AIM:GBO), is an international leader and technology innovator delivering

Enterprise Mobility Management and Telecom software products and solutions. Globo has

established itself as one of the market leaders in the ICT market, offering a wide range of products

and services to the corporate, public and consumer market. The Group operates internationally

through subsidiaries and offices in the US, UK, Europe, Middle East and South East Asia.

In 2012, the Group delivered robust growth both in terms of business and financial

performance. The Board monitors the overall performance of the Group by

reference to Key Performance Indicators (KPIs).

KPIs for the year, together with historical data, are presented in the table below:During 2012, Globo achieved excellent growth resulting in record revenues and profits with

mobile applications driving the Group's international expansion, where it is experiencing strong

demand in both the consumer and enterprise sectors.

Revenue from continuing operations up 67.3 per cent to €46.0 million (2011: €27.5m).

Total revenue (including discontinued operations) up 28.3 per cent to €58.1 million (2011: €45.3m).

EBITDA from continuing operations up 42 per cent to €24.0 million (2011: €16.9m).

Total EBITDA up 35 per cent to €27.8 million (2011: €20.6m).

Profit before tax from continuing operations up 43.3 per cent to €17.2 million (2011: €12.0m).

Profit before tax (including discontinued operations) up 47.9 per cent to €17.9m (2011: €12.1m).

Free cash flow, before the impact of divestment and disposals, of €1.5m for the year; €14.2m net cash at

31 December 2012 after €11.7m investments during the year (2011: €0.8m).

International revenues 81.9 per cent of revenue from continuing operations (2011: €79.6 per cent).

£9.6m of new equity raised via an institutional placing of 36.3million shares in April 2012.

Continuing success in winning partners, distributors and resellers which at the end of 2012 totalled more

than 120 direct partners and 4,500 indirect (through distributors) partners.

Established US presence through acquisition in February 2012 of Dialect Technologies Inc (renamed

Globo Mobile Inc.).

Continued increase in customer base of CitronGO!/GO!Social by 59.3% to approximately 2.23 million

monthly users (2011: 1.4 million).

Sold 51% of Greek business to management for €11.2m on 3 December 2012.

Successful entry into enterprise market with GO!Enterprise achieving revenues of €12.01m (2011:

€2m).

Significant agreement with ASBISC Enterprises Plc (”ASBISC”) to distribute GO!Enterprise mobility

solutions in key markets, with ASBISC being recognized for its broad geographical reach and as a "one-

stop-shop" distributor in 86 countries.

Major UK and Irish distribution agreement for GO!Enterprise product suite with COMPUTERLINKS.

GO!Enterprise product portfolio will be offered via COMPUTERLINKS's channel partners, introducing

enterprise mobility solutions for any business in any vertical market.

Globo joined the Samsung Enterprise Alliance Program (S.E.A.P) that provides key benefits for sales,

marketing and technical solutions, enabling its partners to create new profit models and innovative

solutions.

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During 2012, industry recognition of Globo's technology and products continued with significant awards,

including “National Champion in the prestigious European Business 2012/13 Awards and the recognition

of GO!Enterprise as Best Business App, by Infocom Apps 2012.

Prestigious nominations and short listings both for the Company and its CEO at the AIM and Grant

Thornton Awards 2012.

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Launch of GO!Enterprise Box for SME market, the revolutionary and innovative approach to Enterprise

Mobility that empowers small businesses to securely run and manage their BYOD (Bring Your Own

Device) mobile workforce through the Globo cloud infrastructure.

Major distribution agreement with Ingram Micro Inc, to provide Globo's revolutionary enterprise mobility

solutions for the Enterprise and Small and Medium Business (SMB) market to authorized resellers in the

United States and Canada.

Significant partnership agreement with Fujitsu to enable businesses of all sizes, and especially SMEs, to

implement enterprise mobility. Globo will provide its GO!Enterprise product suite through the Fujitsu

Cloud Store, to offer a complete and fully-secure mobility solution for SMEs in UK and Germany.

Strategic partnership agreement with Digital Management, Inc (DMI) to provide 24x7x365 customer help

and technical support to Globo's enterprise customers.

Globo's shares have been included in the FTSE AIM 100 Index and are on the reserve list for the FTSE AIM

UK 50 Index.

Globo is recognized as one of the 22 companies leading Mobile Development Platform evolution in the

Gartner report Technology Overview of Mobile Application Containers for Enterprise Data Management

and Security

Globo is recognized as one of the 15 companies leading the evolution of Mobile Development Platforms in

the VDC report Strategic Insights 2012: Enterprise Mobility Solutions

THE

AWARDS 2012

The comprehensive Enterprise

Mobility Management (EMM)

platform and BYOD enabler for

all Enterprise sizes

with the challenge of IT consumerisation and

mobilisation of business services/systems.

Through its “write once-deploy to all mobile

operating systems” IDE, GO!Enterprise allows

organisations to deploy secure enterprise apps

across multiple platforms, eliminating the need for GO!Enterprise is a comprehensive Enterprise

multiple solutions like MDM, MAM, MADP and Mobility Management platform including a powerful

others. integrated development environment (IDE) for

GO!Enterprise supports secure “employee centric” rapid visual development of custom mobile apps. It

BYOD implementations and reduces the high TCO provides “out of the box” productivity and

of implementing multiple point solutions.collaboration apps in addition to a secure app

GO!Enterprise offers the following solutions development environment and management

addressing the full range of mobility needs of platform.

enterprises of all sizes.Today's enterprises and small businesses are faced

Achieve Greater Employee Mob i l i s e Any Bus iness

Productivity & Collaboration … Application to any smartphone

while Protecting Critical and tablet

Business Data GO!Enterprise Mobilizer is the perfect choice for

development, deployment and management of GO!Enterprise Office is a mobile office

enterprise mobile apps. GO!Enterprise Mobilizer productivity solution which enables secure and

so lut ions are bu i l t rap id ly us ing the controlled access to enterprise information like

GO!Development Studio, a powerful integrated email, files, contacts, calendar, tasks and notes

development environment (IDE) which produces from any mobile device. Employees can securely

cross-platform mobile GO!Apps with a native look & access the corporate intranet and any other internal

feel. GO!Enterprise Mobilizer enables centralised web application through the secure mobile browser

distribution of GO!Apps on any mobile device and of GO!Enterprise Office. Additionally, they can

provides enterprise-grade functionality for end-to-collaborate while on the go, using the embedded

end management of enterprise mobility solutions. enterprise instant messaging functionality for one-

The use of GO!Enterprise Mobilizer ensures secure to-one chatting and group discussions.

and centrally controlled mobile access to any GO!Enterprise Office is ideally suited for the

enterprise system like ERP, CRM, ordering, billing, implementation of Bring Your Own Device (BYOD)

ticketing etc. and is ideally suited for the mobility strategies.

implementation of Bring Your Own Device (BYOD)

mobility strategies.

247

All- in-one cloud hosted

Enterprise Mobility service

becoming a necessity among SMBs to enable,

secure and manage a diverse set of employee liable

devices.

Productivity and competitiveness are strong drivers Globo provides the solution to the above needs with

for businesses of any size to introduce mobility GO!Enterprise247, a versatile cloud service that

solutions. enables secure communication with back-end

systems, data synchronisation and enterprise-Existing offerings however typically do not offer

grade mobi le appl icat ion management. SMBs the kind of scale, cost or simplicity they need.

GO!Enterprise247 encompasses a hosted Microsoft SMBs usually have limited, if any, IT resources and

Exchange service and data storage enabling secure budget for implementing and managing solutions

access to your files, emails and PIM data. that enable their employees to have access to

business software and information while on the GO!Enterprise247 is based on the technology

move. components of GO!Enterprise but simplified and

crafted for the needs of SMBs.As purchasing devices and implementing a

provisioning process requires significant resources,

a Bring Your Own Device (BYOD) approach is

Mobilise Your Services – Reach

Anybody, Anywhere, Anytime

delivered to mobile devices in a white-labelled

secure container which can receive updates or new

apps from a dedicated repository powered by

GO!Enterprise Reach. GO!Enterprise Reach enables GO!Enterprise Reach is the perfect choice for

seamless and secure integration with any back-end development, deployment and management of B2C

system like CMS, ordering, billing, booking or (business to consumer) and G2C (government to

customer loyalty and is ideally suited for the delivery citizen) mobile apps. GO!Enterprise Reach solutions

of m-services supporting secure transactions, e.g. are built rapidly using a codeless development

m-banking, m-booking, m-shopping, m-parking studio which produces cross-platform mobile

etc.GO!Apps with a native look & feel. GO!Apps are

Uncompromised BYOD for

Small and Medium Businesses

With GO!Enterprise Box, SMBs have secure and

controlled mobile access to all their business

systems and information. At the same time, the

development, deployment and management of GO!Enterprise Box is the revolutionary and

business mobile applications across all devices has innovative approach to enterprise mobility for SMBs

never been easier.that allows small & medium businesses (up to 150

devices) to run and manage their smartphones and GO!Enterprise Box is a plug & play solution and

tablets via the Globo cloud infrastructure, requires zero IT resources while specialised

GO!Enterprise247. technical knowledge is not necessary. Everything

required is provided literally “out of the Box” in a Enterprise Mobility in a Box is a complete

cloud installation. Furthermore, its simplified pay-enterprise mobility solution that is tailor-made to

as-you-go licensing model minimises any up-front the needs of a small and medium sized business.

costs and ensures an exact match with the business Globo has designed GO!Enterprise Box as a tangible

needs.product available on the shelves of major IT

GO!Enterprise Box establishes a new commercial retailers to address customers embracing the

value chain by enabling retailers to address the purchasing habit and shopping experience of a

growing needs of their customers for enterprise bricks & mortar retailer.

mobility solutions.With a fully featured solution including free storage

and access to cloud-hosted Microsoft Exchange

email & PIM services, SMBs do not have to settle for

a scaled down enterprise solution.

TM

G O ! E n t e r p r i s e 2 4 7. c o m

Achieving wider and faster

distribution reach – Enterprise

Mobility GO!es online

GO!Enterprise247.com will, at a later stage,

accommodate the needs of SMBs that want to start

building their enterprise mobility strategy starting

from one licence and follow their company's growth

with no upper limit licence restrictions.

Globo initiates a new electronic channel for the SMBs have now their one stop e-shop where they

distribution of GO!Enterprise, fully addressing the can expand their GO!Enterprise Box (up to 150

online purchasing behaviour of a growing number of deployed device licences) starting from one

SMBs.a d d i t i o n a l l i c e n c e . E v e r y a d d i t i o n a l

Globo is now uniquely placed in all distribution GO!Enterprise247 licence includes 1 hosted MS

channels enhancing the competitiveness of its end-Exchange email account and 10 GB hosted storage.

to-end Enterprise Mobility solutions.Furthermore, SMBs can expand their hosted storage

with additional storage packages and get support

packages when needed.

GO!Enterprise247.com

GO!Enterprise. It has already secured a number of INTRODUCTIONdeals and a major distribution agreement with the

During 2012, Globo achieved excellent growth world's leading IT distributor, Ingram Micro, for the

resulting in record revenues and profits with mobile distribution of our innovative GO!Enterprise –

applications driving the Group's international ®

Enterprise Mobility in a Box product, underpinning expansion, where it is experiencing strong demand our confidence that the US market will become a in both the consumer and enterprise sectors.very significant contributor to future Group

Revenue from our consumer mobile applications, performance.

CitronGO! and GO!Social, grew by 25.3 per cent to Throughout 2012 and so far in the current year, €29.2 million (2011: €23.3 million). Our successful Globo has continued to develop its portfolio of entry into the enterprise mobility market through products and services, focusing on its mobile the launch of our GO!Enterprise offering resulted in business and international expansion. We have revenue of €12.0 million (2011: €2 million), with a continued to benefit from healthy demand and to strong positive response from customers boosting push Globo's expansion into new markets confidence in our technology and the functionality it throughout the world.delivers.

RESULTS AND FINANCEThe divestment of our Greek operations, completed

in early December 2012, has enabled the Group to In April 2012, we raised approximately £9.6 million focus on its international activities whilst improving before expenses via a placing with UK and overall KPIs. international investors. The net proceeds have been

The acquisition in February 2012 of Dialect utilised to fund the Group's continuing international

Technologies Inc. (recently renamed Globo Mobile expansion and software and technology

Inc.) has been successful in all respects. Today it development.

operates as the US operations and sales arm of For the year to 31 December 2012 total revenues,

Following an excellent financial performance last year, in

2013 Globo is well positioned to accelerate its growth and

development in all areas of the international mobile business.

including the divested operations, increased by OUTLOOK28.3 per cent to €58.1 million (2011: €45.3 million),

Following an excellent financial performance last ahead of market expectations. Revenues from

year, in 2013 Globo is well positioned to accelerate continuing operations increased by 67.3 per cent to

its growth and development in all areas of the €46million (2011: €27.5 million). EBITDA including

international mobile business.divested operations, increased by 35 per cent to

GO!Enterprise Server has stimulated substantial €27.8 million (2011: €20.6 million).

interest in the market and our order pipeline is

growing rapidly, strengthening our commercial

Profit for the year from continuing operations rose platform for future development.

by 52.7 per cent to €16.5 million (2011: €10.8 Management has a clear strategy for addressing the

million) with basic earnings per share of 5.6 cents emerging enterprise mobility markets in the US, UK

(2011: 3.2 cents), an increase of 75 per cent.and Western Europe where we plan to build a

Cash generated from operations increased by 118.5 leading global market position. Overall, current

per cent to €14.2 million (2011: €6.5 million). After trading is strong and we are confident that 2013 will

the divestment of the Greek business, investment be a year of significant strategic progress and

and increased working capital requirements as a profitable growth for the Group.

result of expansion, total borrowings at the end of

the year were reduced to €5 million (31 December

2011: €8.5 million). Cash deposits of €19.2 million

at 31 December 2012 gave an overall net cash

position of €14.2 million.

Barry ArikoNon-Executive Chairman

success of GO!Enterprise which achieved significant INTRODUCTIONgrowth relative to 2011 and represented 26.1 per

During 2012 Globo achieved significant growth at cent of sales from continuing operations.

the same time as securing our position as a leading

As a result, the Group has managed to achieve provider of enterprise and consumer mobility

strong financial results with an increase in EBITDA solutions. We succeeded in growing both our

on total revenues of 35 per cent and profit before consumer mobile solutions offering and

tax of 48 per cent, with positive free cash flow for GO!Enterprise mobility platform, and in penetrating

the year (after the impact of acquisitions and new markets such as the US. In addition, we

disposals) of €1.51 million. divested our legacy business in Greece. These

achievements have prepared the ground for our This trading momentum was supported by our

further development as a pioneering international partnership strategy with international distributors,

software vendor in the mobile application space. value-added service providers, mobile operators

and system integrators, which will enable us to Whilst maintaining our track record of achieving our

continue to penetrate our target markets. strategic, financial and operational goals, we have

continued to strengthen our platform for further The divestment of Greek operations, completed

development. successfully in early December 2012, has enabled

the Group to focus on its international activities and Overall, inclusive of divested operations, revenues

at the same time improve overall KPIs. After five grew by 28.3 per cent, to €58.1 million (2011: €45.3

consecutive years of the Greek and Eurozone crisis million).

we are proud of the well planned and executed The 67.3 per cent increase in revenues from

divestment which will also benefit us in the future continuing operations for the year was supported

from a recovery in the Greek economy.by continuing sales growth from CitronGO! and

Our acquisition of Dialect Technologies Inc. GO!Social, which represented 63.5 per cent of

(recently renamed Globo Mobile Inc.) has been revenue from continuing operations, as well as the

successful in all respects. Today it operates as the

We are confident that 2013 will be another excellent year for

Globo when we will further increase our international market

presence and recognition.

US operations and sales arm for GO!Enterprise. It Platform evolution in the GARTNER report

has already succeeded in securing a number of “Technology Overview of Mobile Application

deals and a major distribution agreement with the Containers for Enterprise Data Management and

world's leading IT distributor, Ingram Micro, for the Security”;

distribution of our innovative “GO!Enterprise –

Mobility in a BOX” product, underpinning our VDC: Globo is recognized as one of the 15

confidence that the US market will become a very companies leading the evolution of Mobile

signif icant contributor to future Group Development Platforms in the VDC report “Strategic

performance. Overall, we are confident that 2013 Insights 2012: Enterprise Mobility Solution Mobile

will be the year in which Globo secures its position Development Platforms”.

alongside traditional leaders in the mobility arena as

This worldwide industry recognition is having a an innovator and challenger to current standard

significant positive impact on Globo's business solutions less distinguished in terms of user

development activities and efforts to win experience or simplicity of use.

customers.The Ingram Micro contract is currently in the final

stage of commercialisation and is expected to

commence at the beginning of May 2013 with a

target reach of 14,000 retail stores in the US and

Canada.

The magnitude of recognition provided through this

contract to Globo has resulted in numerous other In 2012, our consumer mobile products and distribution agreements and contracts in other services, CitronGO! and GO!Social, continued to countries including Spain, Germany, Italy, Australia achieve growth, resulting in a 59 per cent increase and UAE while creating an additional revenue in the customer base to approximately 2.23 million stream for the existing resellers that are already active monthly users (2011: approximately 1.4 working with us. million active monthly users).

Sales are principally through mobile value added

service providers (MVASPs) as part of their own

subscription application and content offerings. During 2012 Globo participated in industry analyst

CitronGO! and GO!Social are now being offered in events held by Gartner, Forrester and others, and in

30 countries in Europe, Africa, Latin America, North major industry events including the GSMA World

America, Asia and the Middle East. Globo receives a Mobile Congress in Barcelona, CTIA in New Orleans

fixed service fee per month per active user.and San Diego, and Infocom. This has raised

In addition, we continue to provide value added Globo's profile significantly amongst industry services and offer platforms to a number of MNOs players. For example, recently Globo's name has (mobile network operators) through our wholly been included in the following reports:owned subsidiary, ReachFurther Communications

GARTNER: Globo is recognized as one of Ltd.

the 22 companies leading Mobile Development Most importantly in 2012, our GO!Enterprise

Mobile Applications and Services

(Consumer and Enterprise Solutions)

Industry Recognition

OPERATIONS

offering achieved significant growth as a result of divestment of Globo Technologies S.A., the Group

successful product development and market has ceased to operate in e-business software

positioning to address the growing BYOD (“bring products and services but expects to benefit from

your own device”) trend which a rapidly expanding future profits through its ongoing 49 per cent share

number of enterprises are either deploying or of this associate.

showing an interest in deploying.

The Group continues to expand its S.a.a.S customer During 2012, the global mobile market continued to

base and WiPLUS service (Wi-Fi offering), adding exhibit growth which is manifested in various ways

new premium hotspot locations and developing including:

new synergies with telecom operators looking to

total number of mobile subscribers offer a more holistic service to their customers.

growing by 6.2 per cent to 92.3 per cent of the WiPLUS consists of a fully managed service

global population (2011: 86.1 per cent); andprovided to hotels, airports, marinas and similar

locations with Globo receiving revenue from venue

owners. Globo has continued to invest in expanding new trends emerging, including BYOD,

this product offering and is now well positioned to cross platform application development, mobile

accelerate growth. content management, mobi le secur i ty,

containerization and mobile application The acquisition of Dialect Technologies Inc., had a

management, creating a new landscape broadly positive impact, adding new telecom business

described as mobile enterprise management revenues of €3.6 million although making a small

(MEM).contribution to gross profit, as expected, due to the

historically lower margin nature of the business. We

are now focusing on reducing the less profitable Technology analysts predict growth that

component of this business by enhancing telecom should underpin the enterprise mobility segment.

services with more services such as cloud,

enterprise mobility and other services which we

expect will improve margins during 2013. According to Forrester, by 2016: (i) one

billion consumers will have smartphones; (ii) 350

million employees will use smartphones; and (iii)

global mobile spend will reach $1.3 trillion. During

the same period, mobile cellular subscriptions For the period until 3 December 2012, being the

worldwide are projected to grow from 5.9 billion in date the Group divested 51 per cent of its Greek

2011 to 8 billion in 2016, representing an annual subsidiary, Globo Technologies S.A. recorded

growth rate of 6 per cent (Source: Portio Research revenue of €12.1 million via several projects,

Ltd - Mobile Factbook 2012.);principally from private sector clients. Since the

Telecom Services & Software as a Mobile Applications and Services

Service (S.a.a.S)(Consumer and Enterprise Solutions)

Software products and services

MARKETS AND GROWTH DRIVERS

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In 2011, worldwide MEM software we have identified significant growth prospects in

revenue totaled $444.6 million and is expected to several key markets:

grow at a compound annual growth rate (CAGR) of

31.8 per cent between 2012 and 2016, resulting in Enterprise Mobility in a Box – Through the

total MEM software revenue of $1.8 billion by 2016. Ingram Micro distribution agreement, and via

(Source: IDC);others currently in negotiation, we expect that this

product can contribute significantly by addressing

According to Forrester (Managing Mobile the largely-untapped SME market with an

Complexity-Demand For Enterprise Mobility innovative, cloud-based solution driven by

Solutions Creates Vendor Opportunities 2010), the GO!Enterprise;

value of mobile apps development and deployment

(including professional services), including custom-GO!Enterprise Office – The BYOD trend

built software by contractors and consultants, is and the transition from Blackberries to iPhone and

approximately $250 billion;Android devices represent a significant opportunity.

Our initial success in this field is very promising and

The global market for BYOD and we anticipate further growth in the coming months;

enterprise mobility is forecast to expand at a

compound annual growth rate of more than 15 GO!Enterprise Mobilizer / Reach – This

percent until 2017. In five years the industry is mobile application environment, which helps

estimated to generate more than $181 billion in businesses mobilise their existing enterprise apps

revenue, an increase from only $67 billion in 2011. or build new ones, and can run on all smartphones

North American enterprises are expected to and tablets, has already won significant

account for the majority ($58 billion) of this revenue recognition, and we are confident of further growth.

in 2017. (Source: MarketsandMarkets);

Continuing demand for our consumer Our own mobile application development platform

CitronGO! and GO!Social products against the offering, GO!Enterprise Server, targets businesses

background of limited smartphone penetration in of all sizes and is offered as an annual or monthly

emerging economies. Our proven solution brings licence per device through mobile networks,

smartphone capabilities to feature phones and including existing customers, software and systems

enables MNOs and VASPs to earn revenues from a integrators and hosted services providers.

single product via a single service provider (Globo),

thereby maximizing return and efficiency of

The main drivers of growth for Globo in the mobile advertising budgets.

arena will be as follows:

The BYOD trend which represents a In the WiFi segment we see continuing demand

substantial opportunity for GO!Enterprise for which driven by the dominance of smartphones and

Telecom Services and S.a.a.S

tablets. This generates significant opportunities for PATENTSpartnerships with telecom providers to provide

During 2012, Globo initiated the registration of a WiFi-based offloading of their traffic onto our

number of patents with the US patent office. We WiPLUS infrastructure, offering a new and steady

consider this as a significant step as it both revenue stream that until recently was sporadic.

documents innovations from our R&D team and

We believe we can grow our WiPLUS service creates an asset of value for the future. Currently

substantially, through franchising agreements with the company has submitted 16 patents to the US

selected international partners, providing them Patent Office.

with the technology and a business model to

develop WiPLUS hot spot networks around the

world. We expect to achieve attractive returns from KEY TASKS FOR 2013

franchising WiPLUS, taking into account the We are confident that 2013 will be another excellent

absence of any investment and operating costs for year for Globo when we will further increase our

Globo.international market presence and recognition.

In the pure S.a.a.S telecom offering for SMEs, we Following the divestment of the legacy Greek

see demand coming from more mainstream cloud, business, Globo is now growing as a fully

mobility and other services and we are working on international business in the hottest technology

enhancing profitability.sector of mobile applications and the BYOD trend.

Our business model is based on increased recurring

revenues arising from products and services PRODUCTS AND SERVICE

licensing, underpinning confidence in future DEVELOPMENT

growth.

During 2012, we invested a total of €11.7 million in Our entry into the advanced economies of the UK, infrastructure and the development and update of US and Canada will further boost our financial our mobile products and, in the same period, performance through increased customer loyalty incurred amortisation and depreciation amounting and via the higher pricing level of our enterprise to €8.7 million. products, already identified as a key driver for

future profitability.Our commitment to innovation and growth remains

in line with a well-balanced investment plan for The recently signed distribution agreement with future updates and new products. Ingram Micro for the US and Canada is already

showing positive initial signs. It has also resulted in For 2013, we expect to focus on the maintenance

numerous opportunities for further exploitation of and improvement of our existing products, but also

the SME version of GO!Enterprise in other markets aim to add selected capabilities such as FMC (fixed

such as the UK, Western Europe, Middle East, Asia mobile convergence), cloud provisioning of the

Pacific and Australia.GO!Enterprise platform, MDM (mobile device

management), NFC (near field communication) and Our strategy remains to engage with major IT HTML5 hybrid architecture. distributors and mobile network operators along

with specialized partners such as independent

software vendors, integrators, consultants and product line has demonstrated its strength and

mobile handset manufacturers. innovative positioning against our competitors, and

we are really excited about Globo's prospects for Our plans for 2013 include, where appropriate, the 2013 and beyond.selective acquisition of technology firms that

operate in similar fields of the mobile market

focusing on the US and UK.

We are determined to become a global leader in the

field of mobile applications and BYOD and have

already made significant progress. Our mobile

Konstantinos (“Costis”)PapadimitrakopoulosChief Executive Officer

order to further increase profit margins during and €19.2 million were cash and cash equivalents.

2013. Equity increased by 54.4 per cent to €85.6 million

and total liabilities decreased by 43.9 per cent to

€15.2 million.Gross profit from the mobile segment of the Group

(€26.1 million) accounted for the 93 per cent of the

total gross profit of the Group. Cash generated from operations was strong,

increasing by 118.5 per cent to €14.2 million (2011:

€6.5 million). Net cash flow, after interest and tax Depreciation of tangibles and amortisation of

payments, was €13.2 million (2011: €5.0 million). intangibles was €8.7 million (2011: €7.5 million)

Investment for the year was €11.7million (2011: reflecting the significant product development

€14.5 million), leaving the Group with a positive undertaken in both 2011 and 2012. Operating profit

free cash flow of €1.5 million, before the impact of from continuing operations increased by 42.4 per

acquisitions and disposals. Financing activities cent to €17.8 million (€12.5 million in 2011), with

during the year included share issues, new operating margin of 38.7 per cent (2011: 45.5 per

borrowing and debt repayment resulting in a total cent).

net inflow of €15 million.

The net interest charge from continuing operations In April 2012 the Group raised £9.6 million, before

for the year was €0.3 million (2011: €0.5 million), expenses, via a placing with new and existing

reflecting the reduction in the Group's borrowings shareholders of 36,339,623 new ordinary shares at

during the period.a price of 26.5 pence per share.

Profit before tax from continuing operations for In February 2012, the Group acquired Dialect

2012 was €17.2 million, an increase of 43.3 per cent Technologies Inc., (recently renamed Globo Mobile

over 2011 (€12.0 million). The taxation charge on Inc.) a New York-based specialist provider of IP

continuing operations for the year was €0.7 million telecom technologies and services to international

(2011: €1.2 million). The Group continued to take telecom operators and businesses in the US. The

advantage of special tax relief incentives provided cash consideration for the acquisition was a

by the Cypriot and the Greek Government for maximum of US $800,000 payable in installments.

intellectual property and other investments.The company today operates as the US operations

and sales arm for GO!Enterprise.

Basic earnings per share increased to €0.06 (2011:

€0.03). On December 2012, the Group sold 51% of the

Greek e-business operating entity, Globo

Technologies S.A., to management for a Total assets grew to €100.8 million at 31 December

consideration of €11.2 million plus interest. The 2012 (2011: €82.6 million) of which €43.4 million

consideration is receivable in installments with €1 were non-current assets, €38.2 million were trade

million received on completion, €0.5 million receivables, other receivables and current assets,

compared to 2011 (€20.8 million), accounting for FINANCIAL REVIEW55.6 per cent of total revenues (2011: 45.9 per

During 2012, Globo delivered a strong financial cent) and 70.2 per cent of the revenues from

performance with substantial growth in revenue, continuing operations (2011: 75.6 per cent).

strong profitability and positive operating cash flow.

Total revenues for the year, including the divested

Gross profit from continuing operations increased operations, increased by 28.3 per cent to €58.1

by 42.6 per cent to €24.1 million (2011: €16.9 million compared to 2011 (€45.3 million).

million), with gross margin from continuing

operations for the year falling slightly to 52.4 per

Revenues from continuing operations of the Group cent (2011: 61.4 per cent), which was anticipated.

were €46.0 million, a 67.3 per cent increase Gross profit was as expected with the 15 per cent

compared to 2011 (€27.5 million). This was the decrease in gross margin reflecting the higher

result of strong organic growth in the mobile contribution of S.a.a.S revenues.

segment of the Group, the principal driver of future

growth forward which contributed €41.2 million

Revenues from the telecom segment were €4.8 (2011: €25.3 million), as well as accounting for 70.9

million (2011: €2.2 million) with the gross loss per cent of total revenue (2011: 55.8 per cent) and

(2012: €2 million, 2011: €0.4 million) reflecting the 89.6 per cent of the revenues from continuing

amortisation charge due to the high level of operations (2011: 92 per cent).

investment in 2011 and 2012, and the impact of low

gross margins from the traditional telecom business

International revenues increased markedly to €37.7 of the newly acquired Dialect Technologies Inc.

million (2011: €21.9 million), representing 64.9 per Management is focused on reducing the non-

cent of total revenues for 2012 (2011: 48.3 per profitable component of this business and

cent). The international mobile revenues for the enhancing telecom services with more mainstream

year increased by 55.3 per cent to €32.3 million cloud, enterprise mobility and other services in

During 2012, Globo delivered a strong financial

performance with substantial growth in revenue, strong

profitability and positive operating cash flow.

receivable in 2013, €1.5 million receivable in 2014, 49 per cent of Globo Technologies S.A but does not

€3 million receivable in 2015 and €5.2 million exercise operating or financial control.

receivable in 2016. The Group retains a holding of

Dimitrios GryparisChief Financial Officer

Total Revenue (€,000) Profit Before Tax (€,000)

80.000

60.000

40.000

20.000

0

201020092008 2011 2012

21.000

18.000

15.000

12.000

9.000

6.000

3.000

0

201020092008 2011 2012

The Directors of Globo plc have POST BALANCE SHEET EVENTS

pleasure in presenting their Annual In February 2013 the Group signed a distribution

agreement with Ingram Micro Inc. (NYSE: IM). Report and the audited Financial Under the terms of the agreement, the Ingram Statements for the financial year Micro Mobility division will provide Globo's

ended 31 December 2012.enterprise mobility solutions for the Enterprise and

Small and Medium Business (“SMB”) market to

authorised resellers in the United States and PRINCIPAL ACTIVITIES AND

Canada.REVIEW OF BUSINESS

The principal activities of the Group are the

DIVIDENDSprovision of telecom, mobile software products and

related services, as well as developing and The Directors do not recommend the payment of a

operating broadband wired and wireless networks. dividend (2011: Nil).

A business and financial review of the operations for

the financial year 2012 as well as the future

developments of the Group are included in the DIRECTORS

Chairman's statement, the Chief Executive Officer's The following Directors held office during the year:

review and the Chief Financial Officer's review.B Ariko

G Bonanos

RESEARCH AND DEVELOPMENTG Burnell

By investing in research and development, the J Coughlin

Group develops software products and services to D Gryparis

meet the specialized requirements of business

K Papadimitrakopoulosenterprises and public sector organizations. These

activities rely on internal investment by Globo and

on the adoption of stringent software engineering The Company purchased indemnity insurance for

practices in order to ensure the high quality, Directors covering the financial year.

effectiveness and usability of applications, which

meet customer requirements, reduce production

costs and document the know-how gained from

each project. The Group closely follows

international developments in key business and

technology sectors by actively participating in

European Commission Research & Development

(“R&D”) initiatives.

operating performance and performance relative to

the Group's financial obligations. This year's

increase is mainly due to higher gross and operating

profit, together with a higher proportion of revenues

being derived from the Group's own products and

services.

This measure combines all of the Group's profit

before tax.

EPS is calculated by dividing the Group's profit Year-on-year growth in revenue, is expressed

by the weighted average number of shares in issue.as a percentage. The increase in revenue was a

result of organic growth of the Group.

EBITDA represents net income before interest,

tax, depreciation and amortization. Management

believes that EBITDA is useful in measuring

DIRECTORS' INTERESTS- SHARES

The beneficial interests of the Directors in the issued share capital of the Company were as follows.

G Burnell

Ordinary Shares

At end of period At start of period

J Coughlin - -

B Ariko -

G Bonanos

775,500 747,500

K Papadimitrakopoulos 68,349,135 67,749,135

D Gryparis -

KEY PERFORMANCE INDICATORS

In 2012, the Group delivered robust growth both in terms of business and financial performance. The Board

monitors the overall performance of the Group by reference to Key Performance Indicators (KPIs). KPIs for the

year, together with historical data, are presented in the table below:

CONTINUING OPERATIONS

-

150,000 -

150,000

Earnings per share - basic

EBITDA

Profit before tax

2011

Growth In Revenue

2012

24%

€ 16.9m

€ 12.02m

€ 0.039

67%

€ 24.0m

€ 17.22m

€ 0.052

1

2

3

4

1.

2.

3.

4.

POLICY AND PRACTICE ON FOCUS ON THE INTERNATIONAL

PAYMENT OF CREDITORS MOBILE APPLICATIONS MARKET

The Company does not follow a single standard on Since 2010, the management of the Group has

payment practice but has a variety of payment decided to focus on the international mobile

terms with its suppliers. Payment terms are agreed applications market.

at the commencement of business with each This market is characterized by rapid technological supplier and it is the policy of the Company that change, evolving industry standards, frequent new payment is made accordingly, subject to the terms product introductions and short product life cycles. and conditions being met. The creditors' payment To keep pace with technological developments, the period at 31 December 2012 was 62 days (2011: 33 Group will need to continue to enhance its current days). mobile solutions and services and to continue to

develop new and innovative mobile products and

services.FINANCIAL INSTRUMENTS

The Group is also subject to a variety of other risks Financial instruments are recognised in the Group's

and challenges in managing an organization balance sheet when the Group becomes a party to

operating in various countries and tax jurisdictions, the contractual provision of the instrument.

including those related to:Financial assets carried on the statement of

challenges caused by distance, language financial position include cash and cash and cultural differences;equivalents, trade receivables, trade payables and

borrowings. The particular recognition methods economic conditions in each country or

adopted are disclosed in the individual policy region;

statements associated with each item. The Group's fluctuations in currency exchange rates;activities expose it to a variety of financial market

regulatory changes;risks, including the effects of changes in debt and

political unrest, terrorism and the equity markets, foreign currency exchange rates

potential for other hostilities;and interest rates. The Group's overall risk

management focuses on the unpredictability of public health risks, particularly in areas in

financial markets and seeks to minimise the which we have significant operations;

potential adverse effects on its financial longer payment cycles and difficulties in

performance.collecting accounts receivable;

overlapping tax regimes;

PRINCIPAL RISKS AND difficulties in transferring funds from

UNCERTAINTIES certain countries; and

reduced protection for intellectual The financial risk factors applicable to the Group,

property rights in some countries.together with the risk management procedures

adopted in order to mitigate exposure, are included

in note 3 to the Financial Statements.

·

·

·

·

·

·

·

·

·

·

Furthermore, the Group does not have multi-year case of the Group's employees, the agreements

agreements with mobile customers and may be provide that all of the technology which is

unable to retain key customers, attract new conceived by the individual during the course of

customers or replace departing customers with employment is the Group's exclusive property. The

customers that can provide comparable revenue. development of our technology and many of the

The Group's success requires it to maintain and Group's processes are dependent upon the

expand its current, and develop new, customer knowledge, experience and skills of key scientific

relationships. Most contracts with customers do not and technical personnel.

obligate them to long-term purchasing of our

services. The management cannot assure

COUNTRY AND CURRENCY RISKshareholders that the Group's customers will

continue to use its products and services or that the Continuing issues in the Eurozone have resulted in a

Group will be able to replace, in a timely or effective business risk from high currency volatility and/or

manner, departing customers with new customers the potential of an exit of one or more countries

that generate comparable revenue. Moreover, it is from the euro as well as banking systems being

difficult to obtain a contract from a mobile network frozen.

operator due to the complexity of these types of The Group and our partners also have business

organizations which have numerous levels of relationships in non-Eurozone areas where there

approval.are higher risks of currency volatility and/or limits

and/or restrictions on the ability to exchange the

local currency for a currency of choice.PROTECTION OF PROPRIETARY

In response to these current and evolving SOFTWARE AND INTELLECTUAL conditions, we have reviewed our existing business

PROPERTYpolicies and where necessary evolved them with

The management regards the protection of the the aim of both minimising, where possible, the

Group's developed technologies and intellectual Group's economic exposure and to preserve our

property rights as an important element of its ability to operate under a range of different possible

business operations and as crucial to its success. conditions.

The Group relies primarily on a combination of Should a country exit from the Eurozone, this may

trademark laws, copyright laws, trade secrets, require changes in one or more of our entities'

confidentiality procedures and contractual functional currency and potentially higher volatility

provisions to protect its proprietary technology. The of those entities' trading results when translated

Group generally requires its employees, into Euro.

consultants and advisors to enter into A summary of our foreign exchange risk confidentiality agreements. These agreements management policies is set out within “Financial provide that all confidential information developed risk management – Market risk – Foreign exchange or made known to the individual during the course management” within note 3 to the consolidated of the individual's relationship with the Group is to financial statements.be kept confidential and not disclosed to third

parties except under specific circumstances. In the

Globo EMEA Holdings Limited are holding COUNTRY RISK ASSOCIATED WITH companies of the Group's IPR and other trading GREECEsubsidiary companies respectively. ReachFurther

Greece, having taken measures to solve the major Communications Limited and Globo Services (CY) problem of country solvency for the forthcoming Limited are both trading companies which conduct years through the bond-swap deal with the private business mainly outside of Cyprus. Furthermore, sector involvement (PSI), has significantly reduced the Group currently conducts business with several the potential risk of an exit from the euro, companies that are related to Cyprus. something that could lead to potential default. After

Cyprus has recently experienced a severe crisis in 3 years of austerity measures, the Greek

its banking system, resulting in the 'haircut' of bank Government is taking significant steps in reforming

deposits. The Group did not suffer any financial loss the public sector and the Greek banking system.

from this incident. An associated risk however The Greek Government's ability to capitalise on this

exists in collecting the outstanding receivables from lower exit risk and to attract private investment and

our Cypriot-related or Cypriot-based customers. convince the Greek public that the country is

Management has been in regular contact with these making progress is already shaping Greece's future

entities and received assurances from its major to a great extent. The new government is also

customers that they are not impacted from the making progress in convincing the public that the

measures taken in the banking system as their main country is making progress on fiscal and other

operations are outside of Cyprus. fronts to help improve consumer and business

The Group monitors the situation of the evolving sentiment and possibly put a halt to the continuous

Cypriot crisis and is ready to react if needed. outflow of bank deposits. Currently the agreed

recapitalisation of the banks is underway which will

help re-establish confidence and liquidity to the RISK OF CHANGE IN CARRYING market and increase the inflow of deposits which

A M O U N T O F A S S E T S A N D have left Greece due to the recession uncertainty.

The Group, in following its management strategy, LIABILITIEShas succeeded in expanding international activities

The main potential short-term financial statement during 2012 and, after the divestment of the Greek

impact of the current economic uncertainties is the operations, has reduced its exposure to Greek

possible impairment of non-financial and financial parties in terms of revenues, receivables and

assets.liabilities than in previous years.

Although the Group has significant amounts of

intangible assets, plant, property and equipment

held by companies operating in the Eurozone, at COUNTRY RISK ASSOCIATED WITH

least €28.816m of the Group's continuing revenue CYPRUSis from countries either outside the Eurozone or

The Group has 4 legal entities which are domiciled unaffected by its issues. We believe that future

in Cyprus (GMIP Limited, Globo EMEA Holdings growth in revenue will come from countries not

Limited, ReachFurther Communications Limited impacted by the Eurozone issues. We have

and Globo Services (CY) Limited). GMIP Limited and performed impairment testing for each of our cash

generating units and no impairment charge was COUNTER PARTY RISK deemed necessary. Further detail on this

The Group has relationships with both the end user impairment testing, together with the sensitivity of

of its products and services as well as trading with a the results to reasonably possible adverse

small number of partners who have special assumptions, is set out in note 3 to the consolidated

relationships in various territories with the Mobile financial statements.

Network Operator (“MNO”). These partners are

The Group has billed and unbilled trade receivables head quartered in a number of jurisdictions which

together with customer specific work in progress are often different from that of the end consumer of

totalling €15.87m, €9.22m and €4.39m our products and services. The following table splits

respectively – together “Counterparty exposure”. our counterparty exposure by the region of the end

IFRS contains specific requirements for impairment user. Having considered recent and continuing

assessments of such Counterparty exposure. The financial developments in several parts of the world

Group has a range of Counterparty exposures and we believe that a risk exists of not collecting in time

consistently applies methodologies for impairment or at all, part or the whole of the outstanding

provisions for doubtful items which are overlaid counterparty exposure, due to a possible financial

with judgements determined on a case-by- case turmoil worldwide, including government

basis reflecting the specific facts and circumstances restrictions on currency transfers, freezing of the

of the Counterparty. Detailed disclosures in relation banking system, currency devaluation to such an

to such Counterparty exposures provisions as well extent that our counterparty would be unable to

as disclosures about any receivables that are past fulfil in whole or part their obligation to the Group.

due at the end of the period, concentrations of risk The Group constantly monitors the collection of the

and credit risk more generally as set out in outstanding receivables which historically has been

“Financial risk management – Credit risk” within satisfactory and has no reason to believe that any of

note 3(v) to the Financial Statements. these amounts are not recoverable.

At the end of the period the Group had cash

resources held by counterparties (“Banks”) of As at 31 December 2012 the Group has receivables

€19.143m. Our counterparty risk management is and accrued revenue from several parts of the

focused on the protection and availability of cash world as follows:

deposits for the benefit of the Group. Actions have

been taken to reduce counterparty limits with

certain financial institutions and to hold a

significant proportion of our euro denominated

holdings in highly rated banks outside of the

Eurozone. Furthermore, where cash funds are held

for trading purposes within Greece, it is the Group's

aim to substantially cover these holdings with

borrowings from the same institution. Further

information is provided within “Financial risk

management – Liquidity risk” within note 3(v) to

the Financial Statements.

DEPENDENCE ON KEY PERSONNEL TECHNOLOGY RISK

The Group is dependent upon its executive The Group is engaged in a highly competitive and

management team and other key personnel. Whilst rapidly evolving industry and therefore is subject to

it has entered into contractual agreements with the intense competition from a number of companies.

aim of securing the services of these personnel, the The Group competes with many large global

ability to retain their services cannot be guaranteed. companies as well as many new market entrants,

The development and success of the Group is partly who may implement technologies before the Group

dependent on the ability to retain and recruit high does. The impact of competition could result in

quality staff. The loss of the services of key reduced sales, loss of market share, reduced

personnel or the inability to attract further qualified operating margins etc. Despite continuous

personnel as the Group grows could have an investments in research and development of new

adverse effect on the Group's business and financial products and services, there can be no assurance

results. that the Group will be able to compete successfully

in the future.

Bearing in mind the recent financial developments in several parts of the world, the management believes that

a risk exists of not collecting, in time or at all, part or the whole of the outstanding receivables, due to a possible

financial turmoil worldwide. However, management is constantly monitoring the collection of the outstanding

receivables which is satisfactory and has no reason to believe that any of these amounts are not recoverable.

SUBSTANTIAL SHAREHOLDINGS

As at 31 March 2013 the Company had been notified that the following shareholders have direct or indirect

interests over 3% or more of the issued share capital of the Company:

68,349,135

45,502,758

16,461,474

14,407,645

11,844,665

11,715,357

10,526,477

Shareholder Percentage

Papadimitrakopoulos Konstantinos

Legal & General Investment Management

Ruffer Investment Management

Hargreaves Lansdown Asset Management

TD Direct Investment

Barclays Wealth Management

Huxley Investments Limited

20.26%

13.49%

4.88%

4.27%

3.51%

3.47%

3.12%

18%

22%

15%

11%

34%

100%

2.921

3.519

2.360

1.703

5.367

15.870

India

Latin America

China

Central America

South Eastern Europe

Total

By region of the end user

Net trade receivables

SE Europe

India

Central America

Latin America

Middle East

Eastern Europe

Africa

China

Total

By region of the end user

Accrued revenue

8%

17%

15%

16%

10%

11%

10%

13%

100%

714

1.491

1.376

1.444

930

1.008

929

1.137

9.029

Amount (€ 000)

% of total

% of total

Amount (€ 000) Shares

STATEMENT OF DIRECTORS' RESPONSIBILITIES

state whether applicable IFRSs as

adopted by the European Union have been

followed, subject to any material departures The Directors are responsible for preparing the

disclosed and explained in the Financial Annual Report and the Financial Statements in

Statements; andaccordance with applicable law and regulations.

prepare the Financial Statements on a Company law requires the Directors to prepare

going concern basis, unless it is inappropriate to Financial Statements for each financial year. Under

presume that the Company will continue in that law the Directors have prepared the Group and

business. Parent Company Financial Statements in

accordance with International Financial Reporting The Directors are responsible for keeping adequate

Standards (IFRSs) as adopted by the European accounting records that are sufficient to show and

Union. Under company law the Directors must not explain the Company's transactions and disclose

approve the Financial Statements unless they are with reasonable accuracy at any time the financial

satisfied that they give a true and fair view of the position of the Company and the Group, and enable

state of affairs of the Company and the Group as at them to ensure that the Financial Statements

the end of the financial year and of the profit or loss comply with the Companies Act 2006. They are

of the Group for that period. In preparing these also responsible for safeguarding the assets of the

Financial Statements the Directors are required to: Company and the Group and hence for taking

reasonable steps for the prevention and detection select suitable accounting policies and

of fraud and other irregularities.then apply them consistently;

The Directors are responsible for the maintenance make judgments and accounting

and integrity of the corporate and financial estimates that are reasonable and prudent;

·

·

·

·

information included on the Company's website, AUDITORSwww.globoplc.com. Legislation in the United

Littlejohn LLP have indicated their willingness to Kingdom governing the preparation and

continue in office as auditors.dissemination of the Financial Statements differ

During the year ended 31 December 2012 the from legislation in other jurisdictions.

Board and Audit Committee approved an extension The Company is compliant with AIM Rule 26

to the engagement term of the Senior Statutory regarding the Company's website.

Auditor responsible for the audit opinion of Globo

plc. The term was extended from five to six years.

The Board and Audit Committee is satisfied that the PROVISION OF INFORMATION TO one year extension does not in any way prejudice

AUDITORSthe objectivity and independence of the auditor.

So far as each of the Directors is aware at the time

this report is approved:

AGMthere is no relevant audit information of

The notice of AGM and an explanation of the which the Company's auditors is unaware; and

business to be transacted are on pages 116 to 120 the Directors have taken all steps that they

of this document.ought to have taken as a Director to make

themselves aware of any relevant audit information

and to establish that the auditors are aware of that

information.

·

·

By Order of the Board

Dimitrios Gryparis

Chief Financial Officer

23 April 2013

executive directors, is assessed on an on-going INTRODUCTIONbasis by the other members of the Board. All

Although not required to, the directors have members of the Board are free to bring any matter

decided to provide corporate governance to the attention of the Board, at any time.

disclosures similar to those that would be required

The Board welcomes the views of its shareholders. of a listed company. The Board is responsible for the

The Annual General Meeting (AGM) is used as an Company's corporate governance policy, and

opportunity to communicate and discuss matters recognises the importance of high standards of

with shareholders. All shareholders are encouraged integrity, and consistently seeks to apply the

to attend the Company's AGM in order to take principles set out in the UK Corporate Governance

advantage of the opportunity to ask questions of Code (the “Code”) to the extent they are

the directors.appropriate for, and applicable to, a company of

Globo's size quoted on AIM. Shareholders may also contact the Company in

writing or via its website, which is regularly The directors believe the Board is soundly

updated. Additional information is supplied through constituted and they hold monthly Board meetings.

the circulation of the Annual Report and Accounts. The directors believe that this enables them to

The Company intends to make announcements exercise adequate control over the activities of the

regularly whenever relevant and will continue to Group. There is a clear distinction between the role

update its website in compliance with Aim Rule 26. of the non-executive chairman in running the Board

The Chief Executive Officer and Chief Financial and the chief executive officer in running the

Officer intend to meet individual and institutional business. The latter is obliged to comply with a

shareholders as and when required and will provide schedule of matters requiring Board approval

such information as is permissible in order to give before implementation: this schedule is reviewed

shareholders a better understanding of the by the Board at least annually. The Board receives

Company's activities and progress.regular reports on a wide area of key issues

including operational performance, r isk

management and corporate strategy, budget and AUDIT COMMITTEE

corporate actions etc and other areas which are

either required by law or deemed relevant by the The Audit committee comprises Barry Ariko (Non-

management. Executive Chairman), Joseph Coughlin and Gavin

Burnell. In accordance with its terms of reference The Company maintains appropriate directors' and the principal function of this committee is to officers' liability insurance.determine the appropriateness of accounting

All directors have access to the advice and services policies to be used in the Company's annual results.

of the company secretary and may in furtherance of In addition the Committee is responsible for

their duties, take independent legal and financial assessing the Company's audit arrangements and

advice at the Company's expense.the Company's system of internal controls, and for

They also have access to the minutes of the Board, reviewing the interim and annual results before

in which any concerns expressed by them regarding publication. The executive directors and

matters pertaining to the Group are recorded. While representatives of the external auditors attend

there is no formal process, the performance and meetings by invitation as required. The committee

effectiveness of each director, including the non- meets at least twice each year and receives reports

from the Company's management and external E X E C U T I V E D I R E C T O R S ’ auditors relating to the annual and interim accounts REMUNERATIONand the accounting and internal control systems

Executive Directors' remuneration packages are within the Group. The committee has direct and contained in their service agreements with the unrestricted access to the external auditors.Company. The service agreements have an

indefinite term and provide for notice periods that

reach up to six months. The major components of REMUNERATION COMMITTEEremuneration are the basic annual salary and share

The Remuneration committee comprises Gavin options incentive plan.

Burnell (Chairman), Barry Arriko and Joseph

Coughlin and meets at least twice each year. The

principal duties of the committee are to determine I) BASIC ANNUAL SALARYthe total individual remuneration packages for

An Executive Director's basic salary is reviewed by executive directors and to review the scale and the remuneration committee. In setting appropriate structure of the remuneration and service contracts salary levels, the committee considers the Group as for senior management. The committee also a whole as well as the performance of each administers the Company's share option schemes. individual executive.The Company Secretary is secretary to these

committees.

At this stage of the Group's development, it is felt II) LONG-TERM INCENTIVE PLANthe functions of a Nomination committee can be

The Group adopted a Share Option Incentive Plan adequately fulfilled by deliberation of the full board;

on 15 November 2007. Under this Plan, any Director this will be kept under review.

or any employee of the Group is eligible to receive

Share Options.

REPORT ON DIRECTORS In 2007, each Executive Director received 100,000

Share Options, exercisable from the 14 December REMUNERATION2008 for a five year period.

The Remuneration Committee, which comprises all

In 2010, the Executives Directors received a total of of the non-executive directors, determines the

2,500,000 Share Options, exercisable from 26 remuneration (including bonuses and options) of

November 2011 for a four year period. executive directors.

Costis Papadimitrakopoulos, Gerasimos Bonanos

and Dimitrios Gryparis each exercised 100,000 POLICY ON COMPANY options on 10 December 2012. The options had an

REMUNERATION exercise price of 20 pence per share. The market

price when the above mentioned Directors The Company is active in the information

exercised their share options was 20.12 pence per technology and communications industry and as

share.such, in setting remuneration, the board has to be

mindful of comparative remunerations from within

the marketplace whilst controlling fixed costs.

'

TOTAL

Name

Barry Ariko

Joseph Coughlin

Konstantinos

Papadimitrakopoulos

Gerasimos Bonanos

Dimitris Gryparis

€ 126,000

€ 58,000

€ 754,000

€ 223,000

€ 130,000

€ 168,000

Director's Remuneration for the financial year 2012

Basicannual salary

Position

Chief Executive Officer

Chief Operating Officer

Chief Financial Officer

Non Executive Chairman

Non Executive Director

Other benefits

Total

-

-

€ 60,000

€ 44,000

€ 16,000

€ 126,000

€ 58,000

€ 814,000

€ 267,000

€ 146,000

€ 168,000

Share Price Information

The principal trading market for the ordinary shares is AIM.

At 31 December 2012, the Company had a market capitalization of €83,178,363.

* Euro figure translated, for illustrative purposes only, at a rate of ₤1 = €1.1169 being

the exchange rate at 22 April 2013. (Source: Financial Times)

High

30.12p

Low

16.5p

Share price

Earnings per ordinary share € 0.056 (4.79p *)

Earnings per Share

Period from 1 January to 31 December 2012Gavin Burnell € 49,000 Non Executive Director - € 49,000

-

Brokers RBC Capital MarketsThames CourtOne QueenhitheLondon EC4V 4DE

Nominated Adviser

Auditors Littlejohn LLPStatutory Auditor1 Westferry CircusLondon E14 4HD

Registered Office

Registrar

Company Secretary Lorraine Young

Legal Advisors Memery Crystal LLP44 Southampton BuildingsLondon WC2A 1AP

Share Registrars LimitedSuite E, First Floor9 Lion and Lamb YardFarnhamSurrey GU9 7LL

190 High StreetTonbridgeKent TN9 1BE

RBC Capital MarketsThames CourtOne QueenhitheLondon EC4V 4DE

INDEPENDENT AUDITOR S REPORT SCOPE OF THE AUDIT OF THE

TO THE MEMBERS OF GLOBO PLC FINANCIAL STATEMENTS

We have audited the Financial Statements of Globo An audit involves obtaining evidence about the

Plc for the year ended 31 December 2012 which amounts and disclosures in the Financial

comprise the Consolidated Statement of Statements sufficient to give reasonable assurance

Comprehensive Income, the Consolidated and that the Financial Statements are free from material

Parent Company Balance Sheets, the Consolidated misstatement, whether caused by fraud or error.

and Parent Company Statement of Changes in This includes an assessment of whether the

Equity, the Consolidated and Parent Company Cash accounting policies are appropriate to the Group's

Flow Statements, and the related notes. The and the Parent Company's circumstances and have

financial reporting framework that has been applied been consistently applied and adequately disclosed,

in their preparation is applicable law and the reasonableness of significant accounting

International Financial Reporting Standards (IFRSs) estimates made by the Directors, and the overall

as adopted by the European Union and, as regards presentation of the Financial Statements. In

the Parent Company Financial Statements, as addition, we read all the financial and non-financial

applied in accordance with the provisions of the information in the Annual Report to identify material

Companies Act 2006. inconsistencies with the audited Financial

Statements. If we become aware of any apparent

misstatements or inconsistencies we consider the

RESPECTIVE RESPONSIBILITIES OF implications for our report.

DIRECTORS AND AUDITORS

As explained more fully in the Statement of OPINION ON FINANCIAL

Directors' Responsibilities, the Directors are STATEMENTS

responsible for the preparation of the Financial

Statements and for being satisfied that they give a

true and fair view. Our responsibility is to audit and the Financial Statements give a true and express an opinion on the Financial Statements in

fair view of the state of the Group's and of the Parent accordance with applicable law and International Company's affairs as at 31 December 2012 and of Standards on Auditing (UK and Ireland). Those the Group's profit for the year then ended;standards require us to comply with the Auditing

Practices Board's Ethical Standards for Auditors. the Group Financial Statements have been

properly prepared in accordance with IFRSs as This report, including the opinions, has been adopted by the European Union;prepared for and only for the Company's members,

as a body, in accordance with Chapter 3 of Part 16 of the Parent Company Financial Statements

the Companies Act 2006. We do not, in giving these have been properly prepared in accordance with

opinions, accept or assume responsibility for any IFRSs as adopted by the European Union and as

other purpose or to any other person to whom this applied in accordance with the provisions of the

report is shown or into whose hands it may come Companies Act 2006; and

save where expressly agreed by our prior consent in

writing.

'

In our opinion:

·

·

·

Mark Ling (Senior statutory auditor)For and on behalf of Littlejohn LLPStatutory Auditor

23 April 2013

1 Westferry CircusCanary WharfLondon E14 4HD

·

·

·

·

·

the Financial Statements have been MATTERS ON WHICH WE ARE prepared in accordance with the requirements of R E Q U I R E D T O R E P O R T B Y the Companies Act 2006.

EXCEPTION

We have nothing to report in respect of the

OPINION ON OTHER MATTER following:

PRESCRIBED BY THE COMPANIES Under the Companies Act 2006 we are required to

report to you if, in our opinion:ACT 2006

adequate accounting records have not In our opinion the information given in the

been kept by the Parent Company, or returns Directors' Report for the financial year for which the

adequate for our audit have not been received from Financial Statements are prepared is consistent

branches not visited by us; orwith the Financial Statements.

the Parent Company Financial Statements

are not in agreement with the accounting records

and returns; or

certain disclosures of Directors'

remuneration specified by law are not made; or

we have not received all the information

and explanations we require for our audit.

Continuing Discontinued Continuing Discontinued

Total Operations Operations Total Operations Operations

Note 2012 2012 2012 2011 2011 2011

w’000 w’000 w’000 w’000 w’000 w’000

Revenue 4 58,056 46,007 12,049 45,311 27,535 17,776Cost of sales 5 (29,868) (21,926) (7,942) (24,497) (10,631) (13,866)

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––Gross Profit 28,188 24,081 4,107 20,814 16,904 3,910

Other operating income 6 704 704 – 963 704 259Distribution expenses 7 (2,453) (2,255) (198) (2,401) (1,815) (586)Administrative expenses 8 (6,318) (4,751) (1,567) (5,035) (2,692) (2,343)Other operating expenses 6 (1,080) – (1,080) (1,173) (586) (587)

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––Operating Profit 19,041 17,779 1,262 13,168 12,515 653

Finance income 11 176 45 131 161 82 79Finance costs 11 (1,031) (309) (722) (1,275) (574) (701)Share of loss of associate 21 (297) (297) – – – –

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––Profit before Tax 17,889 17,218 671 12,054 12,023 31

Taxation 13 (961) (675) (286) (3,174) (1,227) (1,947)–––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Profit/(Loss) after Tax 16,928 16,543 385 8,880 10,796 (1,916)–––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Gain on sale of subsidiary 12 876 – 876 – – ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Profit/(Loss) for the Year 17,804 16,543 1,261 8,880 10,796 (1,916)–––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Other Comprehensive Income

Currency translation differenceson foreign operations (6) (6) – 545 545 –

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––Other comprehensive income for

the year, net of tax (6) (6) – 545 545 ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Total Comprehensive

Income for the Year 17,798 16,537 1,261 9,425 11,341 (1,916)–––––––––––––––––––––––––––––––––––––––––––––––––––––––––Profit/(Loss) for the year

attributable to:

Equity holders of the Company 17,804 16,543 1,261 8,800 10,716 (1,916)Non-controlling interests – – – 80 80 –

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––17,804 16,543 1,261 8,880 10,796 (1,916)–––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Total Comprehensive Income for

the year attributable to:

Equity holders of the Company 17,798 16,537 1,261 9,345 11,261 (1,916)Non-controlling interests – – – 80 80 –

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––17,798 16,537 1,261 9,425 11,341 (1,916)–––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Earnings per Share attributable

to the Equity Holders of the

Company (w per share):

Basic and diluted 14 0.056 0.052 – 0.032 0.039 ––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Consolidated statement of comprehensive income

For the Years Ended 31 December 2012 and 2011

The Accounting Policies and Notes on pages 54 to 115 form an integral part of these financial statements.

As at As at31 December 31 December

Note 2012 2011w’000 w’000

ASSETS

Non-Current Assets

Property, plant and equipment 16 1,330 4,237Intangible assets 17 21,121 19,793Goodwill 19 742 742Other receivables 26 9,722 66Investment in an associate 21 10,464 –

–––––––––––––––––––––––––––Total Non-Current Assets 43,379 24,838

–––––––––––––––––––––––––––Current Assets

Inventories and work in progress 24 4,537 4,900Trade receivables 25 18,411 25,002Other receivables 26 4,000 452Other current assets 27 11,251 18,036Cash and cash equivalents 28 19,174 9,338

–––––––––––––––––––––––––––Total Current Assets 57,373 57,728

–––––––––––––––––––––––––––TOTAL ASSETS 100,752 82,566–––––––––––––––––––––––––––EQUITY AND LIABILITIES

Shareholders’ Equity attributable toowners of the Parent

Ordinary shares 29 4,224 3,710Share premium 29 39,067 27,231Other reserves 30 5,221 5,480Reverse acquisition reserve – 351Translation reserve 376 382Retained earnings 36,679 18,265

–––––––––––––––––––––––––––Total Equity 85,567 55,419–––––––––––––––––––––––––––Non-Current Liabilities

Borrowings 31 4,133 3,224Retirement benefit obligations 32 113 278Finance lease liabilities 31 – 1,509Deferred tax liabilities 23 1,768 2,319Other non-current financial liabilities 36 227 –Provisions for other liabilities and charges 32 13 59Taxes payable 34 – 7

–––––––––––––––––––––––––––Total Non-Current Liabilities 6,254 7,396–––––––––––––––––––––––––––

47Financial statements

Consolidated Balance Sheet

At 31 December 2012 and 2011



Note 2012 2011d’000 d’000

Current LiabilitiesTrade and other payables 33 5,084 10,716Income tax payable 432 331Taxes payable 34 515 343Borrowings 31 890 5,271Finance lease liabilities 31 – 188Accrued liabilities and deferred income 35 2,010 2,902

–––––––––––––––––––––––––––Total Current Liabilities 8,931 19,751

–––––––––––––––––––––––––––TOTAL EQUITY AND LIABILITIES 100,752 82,566–––––––––––––––––––––––––––

Approved and authorised for issue by the Board of Directors on 23 April 2013 and signed on its behalf by:

Costis PapadimitrakopoulosChief Executive Officer


Consolidated Balance Sheet continued


Company Number: 05506731 As at As at31 December 31 December

Note 2012 2011w’000 w’000

ASSETS

Non-Current Assets

Investments in subsidiaries 18 8,236 7,403Other receivables 5 –––––––––––––––––––––––––Total Non-Current Assets 8,241 7,403––––––––––––––––––––––––Current Assets

Other receivables 26 30,123 22,775Cash and cash equivalents 28 7,981 237

––––––––––––––––––––––––Total Current Assets 38,104 23,012––––––––––––––––––––––––TOTAL ASSETS 46,345 30,415––––––––––––––––––––––––EQUITY AND LIABILITIES

Shareholders’ Equity attributable toowners of the Parent

Ordinary shares 29 4,224 3,710Share premium 38,367 26,531Other reserves 30 1,632 1,890Translation reserve 365 (203)Retained losses (3,113) ( 1,788)––––––––––––––––––––––––Total Equity 41,475 30,140

––––––––––––––––––––––––Non-Current Liabilities

Borrowings 31 3,921 –Other non-current financial liabilities 36 227 –Taxes payable 34 – 7

––––––––––––––––––––––––Total Non-Current Liabilities 4,148 7––––––––––––––––––––––––Current Liabilities

Trade and other payables 33 159 55Taxes payable 34 116 92Accrued liabilities 35 447 121

––––––––––––––––––––––––Total Current Liabilities 722 268––––––––––––––––––––––––TOTAL EQUITY AND LIABILITIES 46,345 30,415––––––––––––––––––––––––

Approved and authorised for issue by the Board of Directors on 23 April 2013 and signed on its behalf by:

Costis PapadimitrakopoulosChief Executive Officer


Company Balance Sheet



Attributable to owners of the parent

Reverse Non

Ordinary Share Other Acquisition Translation Retained Controlling Total

Shares Premium Reserves Reserve Reserve Earnings Total Interest Equity

w’000 w’000 w’000 w’000 w’000 w’000 w’000 w’000 w’000

GROUP

Balance at

1 January 2011 2,296 8,499 5,788 351 (163) 9,465 26,236 51 26,287–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Profit for the year – – – – – 8,800 8,800 80 8,880Other comprehensive income for the year – – – – 545 – 545 – 545

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total comprehensive

income for the year – – – – 545 8,800 9,345 80 9,425–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Increase in capital 1,414 19,867 – – – – 21,281 – 21,281Share issue costs – (1,135) – – – – (1,135) – (1,135)Share based payments – – 256 – – – 256 – 256

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total contributions

by and distributions

to owners of the

Company 1,414 18,732 256 – – – 20,402 – 20,402–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Acquisition of non controlling interest – – (564) – – – (564) (131) (695)

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Increase in ownership – – (564) – – – (564) (131) (695)

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total transactions

with owners of the

Company, recognised

directly in equity 1,414 18,732 (308) – – – 19,838 (131) 19,707–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Balance at

31 December 2011 3,710 27,231 5,480 351 382 18,265 55,419 – 55,419–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Balance at

1 January 2012 3,710 27,231 5,480 351 382 18,265 55,419 – 55,419–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Profit for the year – – – – – 17,804 17,804 – 17,804Other comprehensive income for the year – – – – (6) – (6) – (6)

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total comprehensive

income for the year – – – – (6) 17,804 17,798 – 17,798–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Increase in capital 451 11,501 – – – – 11,952 – 11,952Share issue costs – (673) – – – – (673) – (673)Exercise of options 49 702 (259) – – 259 751 – 751Exercise of warrants 14 306 – – – – 320 – 320Transfer on disposal of subsidiary – – – (351) – 351 – – –

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total contributions

by and distributions

to owners of the

Company 514 11,836 (259) (351) – 610 12,350 – 12,350–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Balance at

31 December 2012 4,224 39,067 5,221 – 376 36,679 85,567 – 85,567–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––


Consolidated statement of changes in equity

Attributable to owners of the parentOrdinary Share Other Translation Retained Total

Shares Premium Reserves Reserve Earnings Equityw’000 w’000 w’000 w’000 w’000 w’000

COMPANY

Balance at 1 January 2011 2,296 7,799 1,634 (982) (1,234) 9,513––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Loss for the year – – – – (554) (554)Other comprehensive income for the year – – – 779 – 779

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total comprehensive income for the year – – – 779 (554) 225––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Increase in capital 1,414 19,867 – – – 21,281Share issue costs – (1,135) – – – (1,135)Share based payments – – 256 – – 256

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total contributions by and distributions to owners of the Company 1,414 18,732 256 – – 20,402––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Balance at 31 December 2011 3,710 26,531 1,890 (203) (1,788) 30,140––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Balance at 1 January 2012 3,710 26,531 1,890 (203) (1,788) 30,140––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Loss for the year – – – – (1,364) (1,364)Other comprehensive income for the year – – – 568 – 568

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total comprehensive income for the year – – – 568 (1,364) (796)––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Increase in capital 451 11,501 – – – 11,952Share issue costs – (673) – – – (673)Exercise of options 49 702 (258) – 39 532Exercise of warrants 14 306 – – – 320

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total contributions by and distributions to owners of the Company 514 11,836 (258) – 39 12,131––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Balance at 31 December 2012 4,224 38,367 1,632 365 (3,113) 41,475––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––


Company statement of changes in equity


Year Yearended ended

31 December 31 DecemberNote 2012 2011

w’000 w’000

Cash Flows from Operating ActivitiesCash generated from operations 38 14,243 6,480Interest paid 11 (1,031) (1,275)Income tax paid (28) (195)

–––––––––––––––––––––––––––Net Cash generated from Operating Activities 13,184 5,010–––––––––––––––––––––––––––Cash Flows from Investing ActivitiesAcquisition of subsidiary, net of cash acquired 20 (203) –Disposal of subsidiary, net of disposed cash 15 (6,661) –Purchases of tangible and intangible assets 16,17 (11,672) (14,518)Proceeds from sale of tangible and intangible assets 27 1,400Interest received 176 161

–––––––––––––––––––––––––––Net Cash used in Investing Activities (18,333) (12,957)–––––––––––––––––––––––––––Cash Flows from Financing ActivitiesProceeds from issue of share capital 29 12,137 20,586Share issue expenses (672) (1,135)Proceeds from borrowings 6,796 4,981Repayments of borrowings (2,979) (9,776)Repayment of obligations under finance leases (297) (266)

–––––––––––––––––––––––––––Net Cash from Financing Activities 14,985 14,390–––––––––––––––––––––––––––Net Increase in Cash and Cash Equivalents 9,836 6,443–––––––––––––––––––––––––––Movement in Cash and Cash EquivalentsCash and cash equivalents at the beginning of the year 9,338 2,895Net increase in cash and cash equivalents 9,836 6,443

–––––––––––––––––––––––––––Cash and Cash Equivalents at the End of the Year 28 19,174 9,338–––––––––––––––––––––––––––

Major Non-Cash Transactions

On 7 November 2011 the Company issued 3,500,000 ordinary shares of 1p each at 17p per share fully paidas consideration for the acquisition of the 65% non-controlling interest in subsidiary undertaking ReachFurtherCommunications Limited.

Consolidated cash flow statement

For the years ended 31 December 2012 and 2011



31 December 31 DecemberNote 2012 2011

w’000 w’000

Cash Flows from Operating ActivitiesCash used in operations 38 (7,201) (19,234)Interest paid (199) (4)

–––––––––––––––––––––––––––Net Cash used in Operating Activities (7,400) (19,238)–––––––––––––––––––––––––––Cash Flow from Investing ActivitiesInvestment in subsidiaries (262) –Interest received 16 24

–––––––––––––––––––––––––––Net Cash (used in)/generated from Investing

Activities (246) 24–––––––––––––––––––––––––––Cash Flows from Financing ActivitiesProceeds from issue of share capital 29 12,137 20,586Share issue expenses (672) (1,135)Proceeds from borrowings 3,919 –

–––––––––––––––––––––––––––Net Cash Inflow from Financing Activities 15,384 19,451–––––––––––––––––––––––––––Net Increase in Cash and Cash Equivalents 7,738 237–––––––––––––––––––––––––––Movement in Cash and Cash EquivalentsNet increase/(decrease) in cash and cash equivalents 7,738 237Exchange gain on cash and cash equivalents 6 –Cash and cash equivalents at the beginning of the year 237 –

–––––––––––––––––––––––––––Cash and Cash Equivalents at the End of the Year 28 7,981 237–––––––––––––––––––––––––––

Major Non-Cash Transactions

On 7 November 2011 the Company issued 3,500,000 ordinary shares of 1p each at 17p per share fully paidas consideration for the acquisition of the 65% non-controlling interest in subsidiary undertaking ReachFurtherCommunications Limited.


Company cash flow statement

For the years ended 31 December 2012 and 2011


1. General Information

The Consolidated Financial Statements (“the Financial Statements”) of Globo plc (“the Company”) consolidatesthe following companies: Globo plc, Globo Mobile S.A., Profitel Communications S.A., ReachFurtherCommunications Limited, Globo Holdings Ltd, GMIP Limited, Globo Services (CY) Ltd, Globo EMEA HoldingsLimited, Globo Mobile Technologies International FZ – LLP, Globo International LLC, Globo US Holdings LLCand Globo Mobile Inc (“the Group”). Globo Technologies S.A. was consolidated until its disposal on 3 December2012.

The registered office address is 190 High Street, Tonbridge, Kent TN10 4EB.

2. Group Companies

(a) Globo Mobile S.A.

Globo Mobile S.A. was formed on 18 November 2008.

Globo Mobile S.A. executes the mobile global strategy of the Group and the commercialization of the mobileproducts together with platforms and services related to mobile projects through its extensive network ofpartners and Mobile Network Operators.

Globo Mobile S.A.’s registered office is located in Athens, at 67 Ethnikis Antistaseos Street, Chalandri, Greece.Globo EMEA Holdings Limited (formerly Oumpalumpa Limited) owns 100% of Globo Mobile S.A.

(b) Profitel Communications S.A.

Profitel Communications S.A. provides business communication services. Profitel Communications S.A.combines the Group’s software applications in the form of “Software as a Service” (S.a.a.S.) and, togetherwith central infrastructure services, integrates them with third party telecom services. Profitel CommunicationsS.A.’s registered office is located in Athens, at 67 Ethnikis Antistaseos Street, Chalandri, Greece. ProfitelCommunications S.A. is a private company, incorporated in Greece in October 2005. Globo EMEA HoldingsLimited (formerly Oumpalumpa Limited) owns 100% of Profitel Communications S.A.

(c) ReachFurther Communications Limited

35 per cent of the equity shares of ReachFurther Communications Limited were acquired on 31 December2008. The remaining 65 per cent of the equity shares of the company were acquired on 11 November 2011.ReachFurther Communications Limited is a content/service aggregator/enabler with an extensivecontent/service portfolio that caters to the entire mobile and fixed telecommunications market and wasestablished in 2004 by a team of telecommunications professionals with many years experience in the fieldof management and advisors to telecommunications operators in selected European & Middle Easterncountries.

ReachFurther Communications Limited’s registered office is located in 31 Evagorou Street, 4th Floor, Office43, 1066 Nicosia, Cyprus. Globo Mobile S.A. owns 100 per cent of ReachFurther Communications Limited.

(d) Globo Holdings Ltd

Globo Holdings Ltd was incorporated in the British Virgin Islands on 23 April 2010 as a limited liability company.The company was acquired by Globo Plc on 29 July 2010.

The principal activity of Globo Holdings Ltd is the holding of investments. Globo Holdings Ltd’s registeredoffice is located in Tortola, at Road Town, Nerine Chamber, Quastisky Building, British Virgin Islands. Globoplc owns 100% of Globo Holdings Ltd.

Notes to the financial statements

(e) GMIP Limited (formerly Gylenhall Investments Limited)

GMIP Limited (formerly Gylenhall Investments Limited) was incorporated in Cyprus on 16 February 2008 asa limited liability company. The company was acquired by Globo Holdings Ltd on 29 July 2010. On 16 January2013, the company’s name was changed to GMIP Limited (“Globo Mobile Intellectual Property”).

Since 2012, the principal activity of GMIP Limited is to hold the Group’s intellectual property. GMIP Limited’sregistered office is located in Limassol, at Agias Fylaxeos & Zenonos Rossides 2, Cyprus.

Globo plc owns 100% of GMIP Limited.

(f) Globo Services (CY) Limited

Globo Services (CY) Limited was incorporated in Cyprus on 14 June 2010 as a limited liability company.

The principal activity of Globo Services (CY) Limited is the provision of mobile, e-business and softwareproducts and related services. Globo Services (CY) Limited’s registered office is located in Nicosia, at Cornerof Prodromos str.& Zinonos Kitieos, Cyprus.

Globo plc owns 100% of Globo Services (CY) Limited.

(g) Globo EMEA Holdings Limited (formerly Oumpalumpa Limited)

Globo EMEA Holdings Limited was incorporated in Cyprus on 18 February 2008 as a limited liability company.The company was acquired by Globo Holdings Limited on 29 July 2010.

The principal activity of Globo EMEA Holdings Limited is the holding of investments. The company’s registeredoffice is located in Limassol, at Agias Fylaxeos & Zenonos Rossides 2, Cyprus.

Globo plc owns 100% of Globo EMEA Holdings Limited.

(h) Globo Mobile Technologies International FZ – LLC (“Globo Mobile Dubai”)

Globo Mobile Technologies International FZ – LLC was established on 17 August 2010.

Globo Mobile Dubai has been formed as a Free Zone Authority, under commercial license no.18609 issued byMedia Free Zone Authority. The principal activities of Globo Mobile Dubai are software developer, mobilesolution and support service provider, consultancy and customer service. Globo Mobile Dubai’s registeredoffice is located in Dubai, at Al Thuraya Tower No1, Office No 201, United Arab Emirates.

Globo EMEA Holdings Limited owns 66.67% and GMIP Limited owns 33.33% of Globo Mobile Dubai.

(i) Globo International LLC

Globo International LLC was incorporated in Delaware USA on 16 November 2011 as a limited liabilitycompany. The principal activity of Globo International LLC is the provision of mobile products and relatedservices. The company’s registered office is located in Wilmington (New Castle County) at 1209 Orange Street,Delaware 19801, USA. The company also has a trading office in 36 Tanner Street, London, United Kingdom.GMIP Limited owns 100% of Globo International LLC.

(j) Globo US Holdings LLC

Globo US Holdings LLC was incorporated in Delaware USA on 2 February 2012. The principal activity of thecompany is the holding of investments. The company’s registered office is located at 1209 Orange St.,Wilmington (New Castle County), Delaware 19801 USA. Globo plc owns 100% of Globo US Holdings LLC.


(k) Globo Mobile Inc. (formerly Dialect Technologies Inc.)

Globo Mobile Inc. (formerly Dialect Technologies Inc.) was incorporated in Delaware, USA on 15 March 2006.The company’s registered office is located at 247 West 35st., New York, 10001 USA. The principal activity ofGlobo Mobile Inc.is the provision of IP telecom technologies and services. On 8 February 2012, the Groupacquired 100% of the Company’s shares. Globo US Holdings LLC owns 100% of Globo Mobile Inc.

(l) Globo Technologies S.A.

Globo Technologies S.A. is engaged in the provision of e-Business and Telecom Software Solutions and relatedprofessional services to the public and private sector, primarily in Greece. Globo Technologies S.A.’s registeredoffice is located in Athens, at 37A Psaron st., Chalandri, Greece. Globo Technologies S.A. is a private company,incorporated in Greece in November 2000.

Prior to 14 December 2007, Globo Technologies S.A. was the ultimate parent company of the Group. On15 November 2007, Globo Technologies S.A. entered into an Acquisition Agreement with the shareholders ofGlobo plc, in the form of a binding memorandum of understanding under Greek law. This agreement was toacquire the entire issued share capital of Globo Technologies S.A. by means of a contribution in kind by eachshareholder of their shares in Globo Technologies S.A., in exchange for a total of 110,000,000 new ordinaryshares in Globo plc, being the Consideration Shares. On 14 December 2007, Globo plc became the ultimateparent company of the Group through a share exchange and was admitted to the AIM stock market in London.

On 3 December 2012, the Group disposed of 51 per cent of Globo Technologies S.A. through a sale to thatcompany’s management team for a total consideration of €11.2 million plus interest.

The management team acquiring the 51 per cent interest consists of a total of seven managers who areindependent of the Directors of Globo plc. Globo EMEA Holdings Limited owns the remaining 49 per cent.

(m) Globo IT and Telecom Services SRL

Globo IT and Telecom Services SRL was formed on 16 July 2008.

Globo IT and Telecom Services SRL is engaged in the provision of computer programming, consulting andrelated activities. Globo IT and Telecom Services SRL’s registered office is located in Sos. Bucuresti-PloiestiNo 1A, Bucharest Business Park, Intrarea A. et.1, Birou 125, sector 1 Bucuresti, Romania. ProfitelCommunications S.A. owns 100% of Globo IT and Telecom Services SRL.

3. Summary of Significant Accounting Policies

The principal accounting policies adopted in the preparation of the Financial Statements are set out below.These policies have been consistently applied to all the periods presented, unless otherwise stated.

(a) Basis of Preparation

The Financial Statements have been prepared in accordance with International Financial Reporting Standardsas adopted by the European Union (“IFRS”), IFRIC interpretations and the parts of the Companies Act 2006applicable to companies reporting under IFRS. The Financial Statements have been prepared under thehistorical cost convention as modified by the measurement of investments in associates and contingentconsideration at fair value.

The preparation of Financial Statements in conformity with IFRS requires the use of estimates andassumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets andliabilities at the date of the financial information, including the reported amounts of revenues and expensesduring the reporting period. Although these estimates are based on management’s best knowledge of currentevents and actions, actual results may ultimately differ from those estimates.

The Company and Group are presented in Euros and all values are rounded to the nearest thousand (€000),except as otherwise stated.


Standards, amendments and interpretations effective in 2012

(i) New and amended standards adopted by the Group

There are no IFRSs or IFRIC interpretations that are effective for the first time for the financial year beginningon or after 1 January 2012 that would be expected to have a material impact on the Company or Group.

(ii) New and amended standards, and interpretations mandatory for the first time for thefinancial year beginning 1 January 2012, but not currently relevant to the Group

A number of new standards and amendments to standards and interpretations are effective for annual periodsbeginning after 1 January 2012, and have not been applied in preparing these Financial Statements. None ofthese is expected to have a significant effect on the financial statements of the Company or Group.

Amendments to IFRS 1, ‘First time adoption’ on fixed dates and hyperinflation. The first amendment replacesreferences to a fixed date of 1 January 2004 with “the date of transition to IFRSs”, thus eliminating the needfor companies adopting IFRSs for the first time to restate derecognition transactions that occurred beforethe date of transition to IFRSs. The second amendment provides guidance on how an entity should resumepresenting financial statements in accordance with IFRSs after a period when the entity was unable to complywith IFRSs because its functional currency was subject to severe hyperinflation.

IFRS 7, ‘Financial instruments: Disclosures’ was amended in October 2012 for the transfer of financial assets.These amendments are as part of the IASB’s comprehensive review of off Statement of Financial Positionactivities. The amendments promote transparency in the reporting of transfer transactions and improve users’understanding of the risk exposures relating to transfers of financial assets and the effect of those risks onan entity’s financial position, particularly those involving securitisation of financial asset.

Amendments to IAS 12, ‘Income Taxes’ on deferred tax. Currently IAS 12 requires an entity to measure thedeferred tax relating to an asset depending on whether the entity expects to recover the carrying amount ofthe asset through use or sale. It can be difficult and subjective to assess whether recovery will be throughuse or through sale when the asset is measured using the fair value model in IAS 40 Investment Property.Hence this amendment introduces an exception to the existing principle for the measurement of deferred taxassets or liabilities arising on investment property measured at fair value. As a result of the amendments,SIC 21, ‘income taxes – recovery of revalued non-depreciable assets’, would no longer apply to investmentproperties carried at fair value. The amendments also incorporate into IAS 12 the remaining guidancepreviously contained in SIC 21, which is accordingly withdrawn.

(iii) New and amended standards and interpretations issued but not yet effective for thefinancial year beginning 1 January 2012 and not early adopted

The standards and interpretations that are issued, but not yet effective, up to the date of issuance of thefinancial statements are disclosed below. The Company and Group intend to adopt these standards, ifapplicable, when they become effective.

Amendment to IAS 1, ‘Financial statement presentation’ regarding other comprehensive income. The mainchange resulting from these amendments is a requirement for entities to group items presented in ‘othercomprehensive income’ (OCI) on the basis of whether they are potentially reclassifiable to profit or losssubsequently (reclassification adjustments). The amendments do not address which items are presented inOCI. The amendment becomes effective for annual periods beginning on or after 1 July 2012.

IAS 19, ‘Employee benefits’, was amended in June 2011. The amendments eliminate the option to defer therecognition of gains and losses, known as the “corridor method”; streamline the presentation of changes inassets and liabilities arising from defined benefit plans, including requiring re-measurements to be presentedin other comprehensive income; and enhance the disclosure requirements for defined benefit plans, providingbetter information about the characteristics of defined benefit plans and the risks that entities are exposedto through participation in those plans. The amendment becomes effective for annual periods beginning onor after 1 January 2013. The amendment has no impact on the Group.


Amendment to IFRS 1, ‘First-time Adoption of International Financial Reporting Standards’ on governmentloans. This amendment addresses how first-time adopters would account for a government loan with abelow-market rate of interest when transitioning to IFRS. It also adds an exception to the retrospectiveapplication of IFRS, which provides the same relief to first time adopters granted to existing preparers ofIFRS Financial Statements when the requirement was incorporated into IAS 20 ‘Accounting for GovernmentGrants and Disclosure of Government Assistance’ in 2008. The amendment is effective for the accountingperiod beginning on or after 1 January 2013, subject to endorsement by the EU. The amendment has noimpact on the Group.

IFRS 7, ‘Financial Instruments: Disclosures’ was amended for asset and liability offsetting. This amendmentrequires disclosure of information that will enable users of financial statements to evaluate the effect orpotential effect of netting arrangements, including rights of set-off associated with the entity’s recognisedfinancial assets and recognised financial liabilities, on the entity’s financial position. The amendment is effectivefor the accounting period beginning on or after 1 January 2013, subject to endorsement by the EU.

IFRS 10, ‘Consolidated financial statements’, builds on existing principles by identifying the concept of controlas the determining factor in whether an entity should be included within the consolidated financial statementsof the parent company. The standard provides additional guidance to assist in the determination of controlwhere this is difficult to assess. The Group is yet to assess IFRS 10’s full impact and intends to adopt IFRS10 no later than the accounting period beginning on or after 1 January 2013.

IFRS 11, ‘Joint Arrangements’ provides for a more realistic reflection of joint arrangements by focusing onthe rights and obligations of the arrangement, rather than its legal form. There are two types of jointarrangement; joint operations and joint ventures. Joint operations arise where a joint operator has rights tothe assets and obligations relating to the arrangement and therefore accounts for its share of assets, liabilities,revenue and expenses. Joint ventures arise where the joint venture has rights to the net assets of thearrangement and therefore equity accounts for its interest. Proportional consolidation of joint ventures is nolonger allowed. The Group is yet to assess IFRS 11’s full impact and intends to adopt IFRS 11 no later thanthe accounting period beginning on or after 1 January 2013.

IFRS 12, ‘Disclosures of interests in other entities’, includes the disclosure requirements for all forms ofinterests in entities, including joint arrangements, associates, special purpose vehicles and other off Statementof Financial Position vehicles. The Group is yet to assess IFRS 12’s full impact and intends to adopt IFRS 12no later than the accounting period beginning on or after 1 January 2013.

Amendments to IFRS 10, ‘Consolidated Financial Statements’, IFRS 11, ‘Joint Arrangements and IFRS 12,‘Disclosure of Interests in Other Entities’, provide additional transition relief to IFRSs 10,11 and 12 by limitingthe requirement to provide adjusted comparative information to only the preceding comparative period. Fordisclosures related to unconsolidated structured entities, the amendments will remove the requirement topresent comparative information for periods before IFRS 12 is first applied. The Group is yet to assess thefull impact of these amendments and intends to adopt the amended standards no later than the accountingperiod beginning on or after 1 January 2013, subject to endorsement by the EU.

IFRS 13, ‘Fair value measurement’, aims to provide consistency and reduce complexity by providing a precisedefinition of fair value and a single source of fair value measurement and disclosure requirements for useacross IFRSs. The requirements, which are largely aligned between IFRS and US GAAP, do not extend theuse of fair value accounting but provide guidance on how it should be applied where its use is already requiredor permitted by other standards with IFRSs or US GAAP. The standard becomes effective for annual periodsbeginning on or after 1 January 2013.


IAS 27, ‘Separate Financial Statements’, replaces the current version of IAS 27, ‘Consolidated and SeparateFinancial Statements’ as a result of the issue of IFRS 10. The revised standard includes the requirementsrelating to separate financial statements. The revised standard becomes effective for annual periods beginningon or after 1 January 2013.

IAS 28, ‘Investments in Associates and Joint Ventures’, replaces the current version of IAS 28,’Investments inAssociates’, as a result of the issue of IFRS 11. The revised standard includes the requirements for associatesand joint ventures that have to be equity accounted following the issue of IFRS 1. The Group is yet to assessfull impact of the revised standard and intends to adopt IAS 28 (revised) no later than the accounting periodbeginning on or after 1 January 2013.

IFRS 9, ‘Financial instruments’, addresses the classification, measurement and recognition of financial assetsand financial liabilities. IFRS 9 was issued in November 2009 and October 2010. It replaces parts of IAS 39that relate to the classification and measurement of financial instruments. IFRS 9 requires financial assets tobe classified into two measurement categories: those measured as at fair value and those measured atamortised cost. The determination is made at initial recognition. The classification depends on the entity’sbusiness model for managing its financial instruments and the contractual cash flow characteristics for theinstrument. For financial liabilities, the standard retains most of the IAS 39 requirements. The main changeis that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change dueto an entity’s own credit risk is recorded in other comprehensive income rather than the income statement,unless this creates an accounting mismatch. The Group is yet to assess IFRS 9’s full impact and intends toadopt IFRS 9 no later than the accounting period beginning on or after 1 January 2015, subject toendorsement by the EU. The Group will also consider the impact of the remaining phases of IFRS 9 whencompleted by the Board.

Amendments to IAS 32, ‘Financial Instruments: Presentation’, add application guidance to addressinconsistencies identified in applying some of the criteria when offsetting financial assets and financialliabilities. This includes clarifying the meaning of “currently has a legally enforceable right of set-off” and thatsome gross settlement systems may be considered equivalent to net settlement. The Group is yet to assessthe full impact of the amendments to IAS 32 and intends to adopt the amended standard no later than theaccounting period beginning on or after 1 January 2014.

‘Annual Improvements 2009 – 2011 Cycle’ sets out amendments to various IFRSs as follows:

• An amendment to IFRS 1, ‘First-time Adoption’ clarifies whether an entity may apply IFRS 1:

o if the entity meets the criteria for applying IFRS 1 and has applied IFRS 1 in a previous reportingperiod; or

o if the entity meets the criteria for applying IFRS 1 and has applied IFRSs in a previous reportingperiod when IFRS 1 did not exist.

• The amendment to IFRS 1 also addresses the transitional provisions for borrowing costs relating toqualifying assets for which the commencement date for capitalization was before the date of transitionto IFRSs.

• An amendment to IAS 1, ‘Presentation of Financial Statements’ clarifies the requirements for providingcomparative information:

o for the opening Statement of Financial Position when an entity changes accounting policies, ormakes retrospective restatements or reclassifications; and

o when an entity provides Financial Statements beyond the minimum comparative informationrequirements.


• An amendment to IAS 16, ‘Property, Plant and Equipment’ addresses a perceived inconsistency in theclassification requirements for servicing equipment.

• An amendment to IAS 32, ‘Financial Instruments: Presentation’ addresses perceived inconsistenciesbetween IAS 12, ‘Income Taxes’ and IAS 32 with regard to recognizing the consequences of incometax relating to distributions to holders of an equity instrument and to transaction costs of an equitytransaction.

• An amendment to IAS 34, ‘Interim Financial Reporting’ clarifies the requirements on segmentinformation for total assets and liabilities for each reportable segment.

The Group intends to adopt the amended standards no later than the accounting period beginning on orafter 1 January 2013, subject to endorsement by the EU. These improvements are not expected to have animpact on the Group.

(b) Basis of Consolidation

Business Combinations

The Consolidated Financial Statements include the results of the Company and entities controlled by theCompany (its subsidiaries) forming the Group.

Subsidiaries are all entities over which the Company has the power to govern the financial and operatingactivities, generally accompanied by a shareholding equal to more than one half of the voting rights. Theexistence and effect of potential voting rights that are currently exercisable or convertible are consideredwhen assessing whether the Company controls another entity. Subsidiaries are fully consolidated from thedate on which control is transferred to the Group and continue to be consolidated until the date when suchcontrol ceases. If the Group loses control over a subsidiary, it:

• Derecognises the assets (including goodwill) and liabilities of the subsidiary;

• Derecognises the carrying amount of any non-controlling interest;

• Recognises the fair value of the consideration received;

• Recognises the fair value of any investment retained; and

• Recognises any surplus or deficit in profit or loss.

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measuredas the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the dateof exchange. The consideration transferred includes the fair value of any asset or liability resulting from acontingent consideration arrangement. Identifiable assets acquired and liabilities assumed are measuredinitially at their fair values at the acquisition date. The excess of the cost of acquisition over the fair value ofthe Group’s share of the identifiable net assets acquired is recorded as goodwill. In accounting for theacquisition of Globo Technologies S.A., the Company took advantage of Section 131 of the Companies Act1985 and accounted for the transaction using merger relief.

Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisitiondate. Contingent consideration classified as an asset or liability that is a financial instrument and within thescope of IAS 39 Financial Instruments, is measured at fair value with changes in fair value recognised eitherin profit or loss or as a change to other comprehensive income.

Intercompany transactions, balances and unrealised gains on transactions between Group companies areeliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistencywith the policies adopted by the Group.


Investments in subsidiaries are accounted for at cost less impairment. Cost is adjusted to reflect changes inconsideration arising from contingent consideration amendments.

Transactions with non-controlling interests that do not result in loss of control are accounted for as equitytransactions – that is, as transactions with the owners in their capacity as owners. The difference betweenthe fair value of any consideration paid and the relevant share acquired of the carrying value of net assets ofthe subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recordedin equity.

Investment in an associate

The Group’s investment in its associate, an entity in which the Group has significant influence, is accountedfor using the equity method. Under the equity method, the investment in the associate is initially recognisedat cost and the carrying amount is adjusted to recognise changes in the Group’s share of the profit or loss ofthe associate since the acquisition date.

The Group’s share of profit or loss of an associate is shown on the face of the Income Statement, and itsshare of post acquisition movements in other comprehensive income is recognised in other comprehensiveincome with a corresponding adjustment to the carrying amount of the investment. The financial statementsof the associate are prepared for the same reporting period as the Group. When necessary, adjustments aremade to bring the accounting policies in line with those of the Group. When the Group’s share of losses in anassociate equals or exceeds its interest in the associate, including any other unsecured receivables, the Groupdoes not recognise further losses, unless it has incurred legal or constructive obligations or made paymentson behalf of the associate.

The Group determines at each reporting date whether there is any objective evidence that the investment inthe associate is impaired. If this is the case, the Group calculates the amount of impairment as the differencebetween the recoverable amount of the associate and its carrying value and recognises the amount adjacentto ‘share of profit/(loss) of associates’ in the Income Statement.

Profits and losses resulting from upstream and downstream transactions between the Group and its associateare recognised in the Group’s Financial Statements only to the extent of unrelated investor’s interests in theassociates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment ofthe asset transferred. Accounting policies of associates have been changed where necessary to ensureconsistency with the policies adopted by the Group. The financial statements of the associate are preparedfor the same reporting period as the Group.

Non-current assets held for sale and discontinued operations

The Group classifies non-current assets and disposal groups as held for sale if their carrying amounts will berecovered principally through a sale transaction rather than through continuing use. Non-current assets anddisposal groups classified as held for sale are measured at the lower of their carrying amount and fair valueless costs to sell.

Discontinued operations are excluded from the results of continuing operations.

Revenues, expenses, gains and losses are allocated to discontinued operations if the Group will no longer beentitled to that revenue or will no longer incur the expense when the operation is disposed of.Central overheads are allocated to continuing operations unless they are eliminated when the operation isdisposed of.


(c) Going Concern

The Financial Statements are prepared under the going concern assumption.

The Group’s business activities, together with the factors likely to affect its future development, performanceand position are set out in the Chairman’s Statement and Chief Executive Officer’s Report. The financialposition of the Group and Company, their cash flows, liquidity position and borrowing facilities are describedin the Financial Review. In addition, notes 3(v) and 41 to the Financial Statements includes the Group’s andCompany’s objectives, policies and processes for managing their capital; their financial risk managementobjectives; details of their financial instruments and exposure to credit risk, interest rate risk and liquidity risk.

During the year ended 31 December 2012, the Company raised £9.63 million before expenses to support theworking capital requirements of the Group and fund product development and further international expansion.The Group currently has considerable financial resources together with long term contracts with a number ofcustomers and suppliers across different product lines and geographic areas. As a consequence, the Directorsbelieve that the Group is well placed to manage its business and financial risks successfully despite the currentuncertain economic climate and competitive market conditions. The Group also retains banking and loan notefacilities through short and long term borrowings in order to meet working capital requirements and, togetherwith the new funds raised from investors, continues with the development of its software platforms andinternational development.

The Group’s forecasts and projections, taking into account reasonably possible changes in tradingperformance, show that the Group should be able to operate with the cash funds and existing bank and loannote borrowings.

The Directors have a reasonable expectation that the Company and Group have adequate resources tocontinue in operational existence for the foreseeable future. Thus they continue to adopt the going concernbasis of accounting in preparing the Financial Statements.

(d) Measurement Currency

Items included in the Financial Statements are measured using the currency of the primary economicenvironment in which the entity operates (its “functional currency”). The Financial Statements are presentedin Euros (€), which is the Group’s presentational currency. The Financial Statements of the parent undertaking,whose functional currency is pounds sterling, have been translated and stated in Euros.

(e) Foreign Currency Translation

Transactions in currencies other than the Euro are accounted for at the exchange rates ruling at the date ofthe transaction. Monetary assets and liabilities in foreign currencies are retranslated at the rates of exchangeruling at the balance sheet date. Foreign exchange differences on retranslation and settlement are recognisedin profit or loss with the exception of monetary items that are designated as part of the hedge of the Group’snet investment of a foreign operation. These are recognised in other comprehensive income until the netinvestment is disposed of, at which time, the cumulative amount is reclassified to profit or loss.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated usingthe exchange rates at the dates of the initial transactions.

The results and financial position of all the Group entities that have a functional currency different from thepresentation currency are translated into the presentation currency as follows:

• Assets and liabilities for each balance sheet presented are translated at the closing rate at the date ofthat balance sheet;


• Income and expenses for each statement of comprehensive income are translated at average exchangerates; and

• All resulting exchange differences are recognised in other comprehensive income.

On disposal of a foreign operation, the component of other comprehensive income relating to that particularforeign operation is recognised in profit or loss.

(f) Property, Plant and Equipment

Property, plant and equipment, comprising land, property, vehicles and furniture and fittings, are recorded athistorical cost less depreciation and impairment losses.

Property plant and equipment is depreciated on the straight line method over the expected useful life of theassets, as follows:

Asset Useful life

Buildings 33 yearsLeasehold improvements 6 yearsOffice furniture and fittings 6 yearsVehicles 9 yearsComputer and telecom equipment 3-6 years

In accordance with IAS 16 land is not depreciated.

Gains and losses on disposal, determined by comparing proceeds with the carrying amount of the respectiveassets, are included in operating profit within other operating income.

All maintenance and repair costs are expensed as incurred.

Where an indication of impairment exists, the carrying amount of any tangible asset is assessed and is writtendown immediately to its recoverable amount.

(g) Intangible Assets

Intangible assets that are acquired or developed by the Group are carried at historical cost less accumulatedamortisation and impairment losses. The cost of intangible assets acquired in a business combination is theirfair value at the date of acquisition. The useful lives of intangible assets are assessed as either finite orindefinite.

Intangible assets with finite lives are amortised over the useful economic life and assessed for impairmentwhenever there is an indication that the intangible asset may be impaired. The amortisation period and theamortisation method for an intangible asset with a finite useful life are reviewed at least at the end of eachreporting period. Changes in the expected useful life or the expected pattern of consumption of futureeconomic benefits embodied in the asset are considered to modify the amortisation period or method, asappropriate, and are treated as changes in accounting estimates.

Interest costs on borrowings not directly attributable to software development costs are not capitalised butare instead recognised in profit or loss during the period.


Software and Licences

Research expenditure is recognised as an expense in the period in which it is incurred. Costs incurred ondevelopment projects (relating to the design and testing of new and improved products) are recognised asintangible assets when it is probable that the project will be a success considering its commercial andtechnological feasibility, and only if the cost can be reliably measured. Other development expenditures arerecognised as an expense, as they are incurred.

Costs incurred on development projects are recognised as intangible assets only if all of the followingconditions are met:

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

• it is the intention to complete the intangible asset and use or sell it;

• there is an ability to use or sell the intangible asset;

• it can be demonstrated how the intangible asset will generate probable future economic benefits;

• adequate technical, financial and other resources to complete the development and to use or sell theintangible asset are available; and

• the expenditure attributable to the intangible asset during its development can be reliably measured.

Development costs previously recognised as an expense are not recognised as an asset in a subsequentperiod. Development costs that have been capitalised are amortised from the commencement of thecommercial availability of the product on a straight-line basis over its expected benefit period of betweenthree and five years. Licenses are amortised over the shorter of the contract term of the license agreementand the useful life of the asset which does not exceed a four year period.

Computer Software Costs

Computer software costs generally represent costs incurred to purchase software programmes and packagesthat are used both internally and to develop and ultimately sell the Group’s products. Generally, costsassociated with developing or maintaining computer software programmes are recognised as an expense asincurred. However, costs that are directly associated with identifiable and unique software products controlledby the Group, which have probable economic benefit beyond one year, are recognised as intangible assets.Direct costs include staff costs of the software development team as well as the cost of subcontractors. Allother overheads are expensed in the period in which they are incurred.

Expenditure which enhances or extends the performance of computer software programmes beyond theiroriginal specifications is recognised as a capital improvement and added to the original cost of the software.Computer software development costs recognised as assets are amortised using the straight-line methodover their useful lives, not exceeding a period of four years.

Costs associated with the maintenance of existing computer software programmes are expensed as incurred.

Royalties

Royalties represent the cost of acquiring the rights to certain film content for utilisation within the Group’sproducts. The rights acquired can be used over a two year term and accordingly the costs recognised asintangible assets are being amortised over the same period.

All amortization costs for intangible assets with finite lives are included in cost of sales.


(h) Impairment of Non-Current Assets other than goodwill

The carrying amount of property, plant and equipment and intangible assets other than goodwill, is reviewedat each balance sheet date to determine if there is any indication of impairment. An impairment loss isrecognised in profit or loss when the carrying amount exceeds the recoverable amount. The recoverableamount is the greater of net realisable value and value in use.

A previously recognised impairment loss will be reversed in so far as estimates change, but not to an amounthigher than the carrying amount that would have been determined had no impairment loss been recognised.A reversal of an impairment loss is recognised as income.

(i) Leases

A finance lease is one in which a significant portion of the risks and rewards of ownership are transferred tothe lessee. Assets obtained under finance leases and hire purchase contracts are capitalised in the balancesheet and are depreciated over their useful lives. The interest element of the rental obligations is charged toprofit or loss over the period of the lease, and represents a constant proportion of the balance of capitalrepayments outstanding. Assets acquired under finance leases are depreciated over the shorter of the usefuleconomic life and the term of the lease.

The Group has finance leases relating to an office building, vehicles and computer and telecommunicationsequipment under which substantially all of the risks and rewards of ownership are the obligation of the lessee.

An operating lease is one in which a significant portion of the risks and rewards of ownership are retained bythe lessor. Rentals payable under operating leases are charged to profit or loss on a straight-line basis overthe term of the lease.

(j) Inventories and work in progress

Inventories are stated at the lower of their purchase or production cost and their corresponding net realisablevalue. Net realisable value is the estimated re-sale value of the inventories, reduced by the cost of disposal.The cost of inventories is quantified on the basis of the weighted average method and is inclusive of thecosts associated with their acquisition or production (in the case of internally produced goods) and the costsincurred in bringing them to their present location and condition.

Expenses related to client projects which have been won but not yet contracted are classified as work inprogress and included in inventories.

(k) Trade Receivables

Trade receivables are recognised initially at fair value. After initial measurement, trade receivables aresubsequently measured at amortised cost using the effective interest method, less impairment. A provisionfor doubtful trade receivables is established when there is objective evidence that the Group will not be ableto collect all amounts due according to the original terms of the receivables.

(l) Cash and Cash Equivalents

For the purposes of the cash flow statement, cash and cash equivalents comprise cash in hand and calldeposits held with banks.

(m) Share Capital

Ordinary Shares are classified as equity.

Share premium is shown as an addition to the shareholders’ equity and represents the premium amount paidon the issue of new shares.

External costs directly attributable to the issue of new shares are shown as a deduction, net of tax, in equityfrom the proceeds.


(n) Borrowings

Borrowings, net of directly attributable transaction costs, are initially recognised at fair value. After initialrecognition, interest bearing loans and borrowings are measured at amortised cost using the effective interestmethod.

(o) Trade Payables

Trade payables are not interest bearing and are stated at their nominal value, which is considered to be theirfair value. After initial measurement, trade payables are subsequently measured at amortised cost using theeffective interest method.

(p) Income Taxes

The tax expense represents the sum of the tax payable for the current period and deferred tax.

The tax payable in the current period is based on taxable profit for the period. Taxable profit differs fromprofit for the year as reported in the statement of comprehensive income because it excludes items of incomeor expenditure which are taxable or deductible in other periods. It further excludes items that are nevertaxable or deductible. The Group’s liability for tax in the current period is calculated using tax rates that havebeen enacted or substantively enacted by the balance sheet date. Current income tax relating to itemsrecognised directly in equity is recognised in equity and not in the Income Statement.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amountsof assets and liabilities in the Financial Statements and the corresponding tax bases used in the computationof taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities aregenerally recognised for all taxable temporary differences. Deferred tax assets are recognised to the extentthat it is probable that taxable profits will be available against which deductible temporary differences can beutilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or fromthe initial recognition (other than in a business combination) of other assets and liabilities in a transactionthat affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extentthat it is no longer probable that sufficient taxable profits will be available to allow all or part of the assets tobe recovered. Unrecognised deferred tax assets are reassessed at each reporting date and are recognised tothe extent that it has become probable that future taxable profits will allow the deferred tax asset to berecovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settledor the asset is realised. Deferred tax is charged or credited in profit or loss, except when it relates to itemscharged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred taxassets and liabilities are offset when they relate to income taxes levied by the same taxation authority andthe Group intends to settle its current assets and liabilities on a net basis.

(q) Post Retirement Benefits

The Group’s obligation in respect of post-retirement benefits is calculated by estimating the value of benefitsthat employees have earned in return for their service in the current and prior periods, based on the level ofemployee earnings in accordance with Greek Labour Law.

The Group has established a provision for staff retirement indemnities based on an actuarial study. Theactuarial study is performed every year by an independent qualified firm. There is no requirement for theGroup to contribute to any pension plan.


(r) Government Grants

Government grants are recognised at their fair value where there is reasonable assurance that the grant willbe received and the Group will comply with all attached conditions.

Government grants relating to expenses are recognised in profit or loss in order to match them with the coststhey are intended to compensate.

Government grants in relation to the construction of intangible assets are initially treated as deferred incomeand recognised as income over the life of the asset by way of a reduced amortisation charge.

(s) Provisions

Provisions are only recognised when the Group has a present legal or constructive obligation as a result ofpast events, it is probable that an outflow of resources will be required to settle the obligation, and a reliableestimate of the amount of the obligation can be made. The expense relating to a provision is recognised inthe Income Statement net of any virtually certain reimbursement.

(t) Revenue Recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group andthe revenue can be reliably measured, regardless of when the payment is being made. Revenue is measuredat the fair value of the consideration received or receivable, taking into account contractually defined termsof payment and excluding taxes. The Group assesses its revenue arrangements against specific criteria todetermine whether it is acting as principal or agent.

The Group has the revenue streams from the following segments:

Revenue from sale of goods is recognised when the significant risks and rewards of ownership of the goodsare transferred to the buyer. Revenue from rendering of services is based on the stage of completiondetermined using the percentage of completion method where revenue is matched with the costs incurredin reaching the stage of completion. The stage of completion is determined by comparing the proportion thatcosts incurred for work performed to date bear to the budgeted total cost of the services to be performed.The Group recognises revenue when the amount of revenue can be reliably measured and it is probable thatfuture economic benefits will flow to the entity. Amounts recoverable on such long term contracts are includedin Other Current Assets.

Third party goods: The Group resells third party goods, to its customers, mainly comprising hardware tocomplement a software project. Revenue is recognised when the risks and rewards of ownership, togetherwith title to the goods, have passed to the customer and the amount can be measured reliably.

Software products and services: The Group sells its own software products and services to its clients both inthe private and public sector. Individually contracted projects with customers do not give rise to recurringrevenue. Contract revenue is recognised using the percentage completion method as described above.From December 2012 onwards, this revenue stream is discontinued following the disposal of GloboTechnologies S.A.

Telecom services (S.a.a.S): The Group combines telecom services with its own software products that arethen sold on a “software as a service” basis. This revenue stream includes repeat customer orders for servicessuch as bulk SMS, SMS service integration and web hosting. Revenue from recurring S.a.a.S transactions isrecognised on the basis of usage volume at the contracted unit price. Revenues from the provision of WiFibroadband networks is recognised at the date of sale of the non-refundable prepaid access card to the venueowner and is determined as a percentage of the price charged to the end user.

Mobile products and services: The Group sells its own mobile software products and services to its clients,being Mobile Network Operators (“MNOs”) and resellers. Revenue on contracts for the sale of services isrecognised on a monthly basis, based on a fixed service fee per active user (a “revenue share model”). The


fixed fee is determined as a percentage of the reference price charged to the end user, agreed between theGroup and the MNO or reseller. Revenue from the sale of product licences is recognised when ownership ofthe licence, and the right to use the licence, is unconditionally transferred to the buyer. This is the point atwhich the buyer takes on all risks and rewards associated with the licence.

Interest income is recognised on the accruals basis taking into account the effective yield on the asset.

(u) Financial Instruments

Financial instruments are recognised in the Group’s balance sheet when the Group becomes a party to thecontractual provision of the instrument. Financial instruments carried on the balance sheet include cash andcash equivalents, trade receivables, trade payables, and borrowings. The particular recognition methodsadopted are disclosed in the individual policy statements associated with each item.

Financial Assets

Classification

The Group classifies its financial assets as loans and receivables. The classification depends on the purposefor which the financial assets were acquired. Management determines the classification of its financial assetsat initial recognition.

Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are notquoted in an active market. After initial measurement, such financial assets are subsequently measured atamortised cost using the effective interest method, where material, less impairment. They are included incurrent assets, except for maturities greater than 12 months after the end of the reporting period. These areclassified as non-current assets. The Group’s loans and receivables comprise Trade and Other Receivablesand Cash and Cash Equivalents in the Balance Sheet. The losses from impairment are recognised in theIncome Statement in administrative expenses.

Recognition and Measurement

Regular purchases and sales of financial assets are recognized on the trade date – the date on which theGroup commits to purchasing or selling the asset. Investments are initially recognized at fair value plustransaction costs. Financial assets are derecognized when the rights to receive cash flows from theinvestments have expired or have been transferred, and the Group has transferred substantially all of the risksand rewards of ownership. Loans and receivables are subsequently carried at amortized cost using theeffective interest method.

Offsetting Financial Instruments

Financial assets and liabilities are offset and the net amount reported in the Balance Sheet when there is alegally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis,or realise the asset and settle the liability simultaneously.

Impairment of Financial Assets – Assets Carried at Amortised Cost

The Group assesses at the end of each reporting period whether there is objective evidence that a financialasset, or a group of financial assets, is impaired. A financial asset, or a group of financial assets, is impaired,and impairment losses are incurred, only if there is objective evidence of impairment as a result of one ormore events that occurred after the initial recognition of the asset (a “loss event”), and that loss event (orevents) has an impact on the estimated future cash flows of the financial asset, or group of financial assets,that can be reliably estimated.


Evidence of impairment may include indications that the debtor or a group of debtors is experiencingsignificant financial difficulty, default or delinquency in interest or principal repayments, the probability thatthey will enter bankruptcy or other financial reorganisation, and where observable data indicate that there isa measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditionsthat correlate with defaults.

For the loans and receivables category, the amount of the loss is measured as the difference between theasset’s carrying amount and the present value of the estimated future cash flows (excluding future creditlosses that have not been incurred), discounted at the financial asset’s original effective interest rate. Theasset’s carrying amount is reduced, and the loss is recognized in profit or loss.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be relatedobjectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’scredit rating), the reversal of the previously recognised impairment loss is recognised in profit or loss.

Financial liabilities

The Group determines the classification of its financial liabilities at initial recognition. All financial liabilitiesare recognised initially at fair value and, in the case of loans and borrowings, net of directly attributabletransaction costs. The Group’s financial liabilities include trade and other payables, loans and borrowings.

Loans and borrowings

After initial recognition, interest bearing loans and borrowings are, where material, subsequently measuredat amortised cost using the effective interest method. Gains and losses are recognised in profit or loss whenthe liabilities are derecognised as well as through the effective interest amortisation process.

(v) Financial Risk Management

The Group’s activities expose it to a variety of financial market risks, including the effects of changes in foreigncurrency exchange rates and interest rates. The Group’s overall risk management focuses on theunpredictability of financial markets and seeks to minimise the potential adverse effects on its financialperformance.

Foreign Exchange Risk

The Group operates internationally but is currently exposed to minimal foreign exchange risks arising fromvarious currency exposures with respect to certain customers’ and suppliers’ balances, primarily with regardto US dollars and UAE Dirhams. At 31 December 2012, if the US dollar had weakened/strengthened by10% against the Euro with all other variables held constant, post tax profit for the year would have been€68,472 higher/lower as a result of gains/losses on translation of US Dollars assets and liabilities.

Interest Rate Risk

The Group is exposed to interest rate risk as it borrows and places surplus cash at floating interest rates.Exposure to interest rate risk on borrowings and cash investments is monitored on an ongoing and proactivebasis. All borrowings are denominated in Euros and Sterling. During the year ended 31 December 2012, ifaverage interest rates on borrowings had been 200 basis points higher/lower with all other variables heldconstant, pre-tax profit for the year would have been €162,027 lower/higher as a result of higher/lowerinterest expense on floating rate borrowings.

Credit Risk

The principal risk facing the Group is with the ability of the counterparties to honour their commitments tothe Group, together with the concentration of this risk with a limited number of trading partners.

Credit risk arises from work in progress, trade receivables, post dated cheques received, accrued income,advance payments to subcontractors and suppliers, and amounts recoverable on long term contracts. The


Group has a concentration of credit risk within Greece in all of the above categories, given their associationwith the Greek public sector and from counterparties who are also affected by the risk of non-settlement ofthe public sector liabilities. With regard to the international mobile applications market, the Group currentlyhas a concentration of risk with a small number of mobile network operators and resellers. The Group seeksto mitigate these risks wherever possible by assessing the credit quality of the customer which, in the absenceof any independent rating, takes into account its financial position, past experience and other factors. Longterm and ongoing relationships with customers also reduce the credit risk.

Credit risk arises for cash and cash equivalents. For banks and local financial institutions, only independentlyrated parties with a minimum rating of B are utilised by the Group.

Liquidity Risk

Cash plan budgets and forecasts are prepared and monitored at an individual entity and Group level in orderto control liquidity requirements and ensure sufficient cash resources exist in order to meet operational needs.In addition, cash forecasts are used to ensure the Group adheres to the terms of its borrowing facilities andloan covenants, where applicable. Any surplus cash is held in interest bearing bank accounts.

The Group’s financing requirements have significantly increased due to investment in software developmentand other working capital requirements. The Group meets its financing needs through several credit linesestablished with local banks which are mainly based upon collateral such as customer contracts, invoices andpost-dated cheques received.

Fair Value Estimation

Management considers that the carrying amount of the Group’s financial assets and liabilities approximatesto their fair value at each balance sheet date.

(w) Segment Information

Operating segments are reported in a manner consistent with the internal reporting provided to the chiefoperating decision-makers, who are responsible for allocating resources and assessing performance of theoperating segments and making strategic decisions.

(x) Goodwill

Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest inthe fair value of the identifiable assets and liabilities of a subsidiary, associate or jointly controlled entity atthe date of acquisition. Goodwill is recognised as an asset and reviewed for impairment at least annually.Any impairment is recognised immediately in the statement of comprehensive income and is not subsequentlyreversed.

Under the reverse acquisition, goodwill represents the excess of the cost of the combination over the acquirer’sinterest in the net fair values of the legal parent. The fair value of the equity instruments of the legal subsidiaryissued to effect the combination was not available therefore the fair value of all the issued equity instrumentsof the legal parent before the business combination was used as the basis for determining the cost of thecombination.

For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisitiondate, allocated to each of the Group’s cash generating units that are expected to benefit from the combination.Goodwill with an indefinite useful life is tested annually for impairment. An impairment loss is recognised forthe amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amountis the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessingimpairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows(cash generating units).


(y) Share-Based Payments

The Group has applied the requirements of IFRS 2 “Share-based payments”. Equity-settled share-basedpayments are measured at fair value at the date of grant. The fair value is expensed on a straight-line basisover the vesting period, based on the Group’s estimate of shares that will eventually vest. At each balancesheet date, the Group revises its estimate of options that are expected to vest and recognises the impact ofany revision to original estimates in profit or loss with corresponding adjustments to shareholders equity.

The grant by the Company of options over its equity instruments to the employees of subsidiary undertakingsis treated as a capital contribution. The fair value of employee services received, measured by reference tothe grant date fair value, is recognised over the vesting period as an increase to investment in subsidiaryundertakings, with a corresponding credit to equity.

Where equity instruments are granted to persons other than Directors or employees, profit or loss is chargedwith the fair value of the goods and services received.

(z) Critical accounting estimates and judgements

The key assumptions concerning the future and other key sources of estimation uncertainty at the reportingdate, that have a significant risk of causing a material adjustment to the carrying amounts of assets andliabilities within the next financial year, are described below. The Group based its assumptions and estimateson parameters available when the consolidated financial statements were prepared. Existing circumstancesand assumptions about future developments, however, may change due to market changes orcircumstances arising beyond the control of the Group. Such changes are reflected in the assumptions whenthey occur.

i) Estimation of Contract Income

Estimated income receivable on contracts is judged by Management through the application oftheir experience and knowledge of the industry in which the Group operates. Income for eachindividual contract is determined according to the stage of completion determined by referenceto the cost of services performed to date as a percentage of the total cost of services to beperformed. Management consider that the cost of services performed under each contract at anystage of completion when compared to total budgeted cost is an accurate measure of the workperformed under those contracts. Total budgeted costs are continually reviewed throughout thecontract for accuracy and costs incurred are closely monitored against budget. As at 31 December2012 the amounts recoverable on long term contracts were €9,220,000 (2011 – €13,952,000).

ii) Provision for Bad Debts and Impairment of Financial Assets

Management carry out detailed reviews of trade and other receivables during the financial year.This review takes into account the age of the debt, credit history and information available aboutthe financial strength of the client or counterparty. If it is considered, based on the availableevidence, more likely than not that the debt will not be recovered in full then a provision is madeto write down the receivable to reflect the anticipated recovery. Details of the provision againstdoubtful debts are set out in note 25.

iii) Impairment of Goodwill

The carrying value of goodwill as at 31 December 2012 is €742,000 (2011 – €742,000).Determining whether goodwill is impaired requires an estimation of the value in use of the cashgenerating units to which goodwill has been allocated. The value in use calculation requires theentity to estimate future cash flows expected to arise from the cash generating unit and apply asuitable discount rate in order to calculate present value. These cash flows could be affectedupwards or downwards by movements in several factors to include market conditions andoperating costs. The calculation is also sensitive to changes in discount rate. Details of theimpairment review are set out in note 19.


iv) Deferred Taxation

The Group is subject to income taxes in a number of jurisdictions. Judgement is required indetermining the provision for such taxes. The Group recognises liabilities for anticipated tax issuesbased on estimates of whether additional taxes will be due. Where the final tax outcome of thesematters is different from the amounts that were initially recorded, such differences will affect thecurrent and deferred income tax assets and liabilities in the period in which such determinationis made.

A deferred tax asset of €891,000 (2011 – deferred tax asset of €831,000) has been recognisedin respect of carrying forward tax losses and tax credits arising from the Group’s tax credit claimrelated to research and development expenditure. In accordance with Greek Tax Law, fifty percent of eligible expenditure on scientific and technological research can be claimed from theGeneral Secretariat for Research and Technology and, if accepted, deducted from Greek GAAPtaxable profits. If the tax credit claim in any one year exceeds the Greek GAAP tax liability, thetax credit can be carried forward as tax losses and offset against future tax liabilities for amaximum period of 5 years. Any excess is not refunded in cash. Should the claims submitted tothe General Secretariat not be accepted in whole or in part or if insufficient future Greek taxableprofits are generated within the required timescale, the Group may need to revise the carryingvalue of this asset.

v) Fair value measurement of deferred consideration receivable

The deferred consideration receivable from the disposal of 51 per cent of Globo Technologies S.A.is recorded at amortised cost using the effective interest (“EIR”) method. The inputs to thediscounted cash flow model, in particular the EIR, involves a degree of judgement where noobservable market rate is available. Changes in the assumptions could affect the reported valueof the profit/(loss) on disposal and also the fair value of the retained interest in associate. If theEIR had increased/(decreased) by 1% the profit on disposal would have (decreased)/increasedby approximately €300,000.

vi) Fair value measurement of contingent consideration

Contingent consideration, resulting from business combinations, is valued at fair value at theacquisition date as part of the business combination. It is subsequently remeasured to fair valueat each reporting date and the key assumption is the probability of meeting the performancetarget within the timescale as determined under the terms of the purchase agreement. Theestimated fair value at the acquisition date and at the reporting date is the maximum considerationwhich could be paid. The contingent consideration is classified as other financial liability.

4. Segment Information

The following segments are based on management reports received by the Board of Directors (who are thechief operating decision makers) which are used to make strategic decisions. The Directors consider thebusiness from a product perspective. The main segments are:

Mobile products and services: The main activity of the Group. The Group sells its own mobile softwareproducts and services to its clients.

Telecom services (S.a.a.S): The Group combines telecom services with its own software products (e-businessand WiFi services) that are then sold on a “software as a service” basis.

Third party goods: The Group resells third party goods, to its customers, mainly comprising hardware tocomplement a software project. As from December 2012, this is a discontinued segment for the Group.

Software products and services: The Group sells its own software products and services to its clients both inthe private and public sector. As from December 2012, this is a discontinued segment for the Group.


Transactions between segments are recorded at cost.

The Directors assess the performance of the operating segments based on revenue from external customersand gross profit. The segment information provided to the Directors for the reportable segments for the yearended 31 December 2012 is as follows:

Discontinued Continuingoperations operations

Software MobileThird products Telecom products Inter-party and services and segment Segment

goods services (S.a.a.S.) services Total balances Totalw’000 w’000 w’000 w’000 w’000 w’000 w’000

Total segment revenue 1,991 12,468 7,719 68,822 91,000 (32,944) 58,056Intersegment revenue (2) (2,408) (2,879) (27,655) (32,944) – –

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Revenue from externalcustomers 1,989 10,060 4,840 41,167 58,056 – 58,056Inventory costs (3,570) – – – (3,570) – (3,570)Other expenses – (7,595) (5,692) (38,154) (51,441) – (51,441)Amortisation – (1,744) (1,978) (4,079) (7,801) – (7,801)Intersegment costs 2,292 2,675 804 27,173 32,944 – 32,944

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Gross Profit/(Loss) 711 3,396 (2,026) 26,107 28,188 – 28,188–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Depreciation – 795 105 25 925 – 925Expenditure on tangiblefixed assets – 279 143 78 500 – 500Expenditure onintangible assets – 3,482 3,716 4,006 11,204 – 11,204Total assets – – 17,929 85,521 103,450 (35,614) 67,836

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total liabilities – – 10,556 35,341 45,897 (35,613) 10,284–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

A further analysis of the Group’s revenue for 2012 is shown below:

Software Mobileproducts Telecom products

Third party and services andRevenue 2012 (w’000) goods services (S.a.a.S) services Total

Mobile applications and services – – – 41,167 41,167E-Business and software as aservice – 10,060 4,481 – 14,541WiFi Broadband Networks – – 359 – 359Third party goods 1,989 – – – 1,989

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total 1,989 10,060 4,840 41,167 58,056–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––


The segment information provided to the Directors for the year ended 31 December 2011 is as follows:

Discontinued Continuingoperations operations

Software MobileThird products Telecom products Inter-party and services and segment Segment

goods services (S.a.a.S.) services Total balances Totalw’000 w’000 w’000 w’000 w’000 w’000 w’000

Total segment revenue 523 17,608 6,097 29,238 53,466 (8,155) 45,311Intersegment revenue (271) (84) (3,901) (3,899) (8,155) – –

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Revenue from externalcustomers 252 17,524 2,196 25,339 45,311 – 45,311Inventory costs (581) – – – (581) – (581)Other expenses – (15,263) (1,179) (9,158) (25,600) – (25,600)Amortisation – (2,194) (1,456) (2,821) (6,471) – (6,471)Intersegment costs 271 3,901 77 3,906 8,155 – 8,155

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Gross Profit (58) 3,968 (362) 17,266 20,814 – 20,814–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Depreciation – 914 85 4 1,003 – 1,003Expenditure on tangiblefixed assets – 1,408 326 37 1,771 – 1,771Expenditure onintangible assets – 2,991 4,125 5,633 12,749 – 12,749Disposal of intangibleassets – (6) (970) – (976) – (976)Total assets 430 25,012 12,995 34,005 72,442 (7,378) 65,064

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total liabilities 399 4,406 3,549 6,436 14,790 (7,378) 7,412–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

A further analysis of the Group’s revenue for 2011 is shown below:

Software Mobileproducts Telecom products

Third party and services andRevenue 2011 (w’000) goods services (S.a.a.S) services Total

Mobile applications and services – – – 25,339 25,339E-Business and software as aservice – 17,524 1,824 – 19,348WiFi Broadband Networks – – 372 – 372Third party goods 252 – – – 252

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Total 252 17,524 2,196 25,339 45,311–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––


A reconciliation of gross profit to profit before taxation is provided as follows:


31 December 31 December2012 2011w’000 w’000

Gross profit for reportable segments (continuing operations) 24,081 16,904Other operating income 704 704Distribution expenses (2,255) (1,815)Administrative expenses (4,751) (2,692)Other operating expenses – (586)Share of loss of associate (297) –Finance costs (net) (264) (492)

––––––––––––––––––––––––––

Profit before tax 17,218 12,023––––––––––––––––––––––––––Reportable segments’ assets are reconciled to total assets as follows:


2012 2011w’000 w’000

Segment assets for reportable segments 67,836 65,064Unallocated:Property, plant and equipment – 2,195Goodwill 742 742Other receivables 13,302 460Investment in associate 10,464 –Trade receivables – 5,804Other current assets 25 45Cash and cash equivalents 8,383 8,256

––––––––––––––––––––––––––

Total assets per balance sheet 100,752 82,566––––––––––––––––––––––––––


Reportable segments’ liabilities are reconciled to total liabilities as follows:


2012 2011w’000 w’000

Segment liabilities for reportable segments 10,284 7,412Unallocated:Borrowings 3,921 7,350Retirement benefit obligations – 261Finance lease liabilities – 2,575Accrued liabilities 467 693Trade and other payables 166 8,644Taxes payable 116 162Other non-current liabilities 227 –Provisions for other liabilities and charges 4 50

––––––––––––––––––––––––––

Total liabilities per balance sheet 15,185 27,147––––––––––––––––––––––––––Revenue from external customers(Continuing and discontinued operations)



Greece 20,346 23,423South-eastern Europe 7,678 4,513Western Europe 272 1,010Eastern Europe 4,244 354Africa 1,994 1,847Latin America 11,606 2,197North America 453 1,936Asia 10,646 6,197Middle East 817 3,834

––––––––––––––––––––––––––

Total 58,056 45,311––––––––––––––––––––––––––


Non-current assets


2012 2011w’000 w’000

Greece 10,055 24,796Germany – 21Cyprus 32,208 6USA 347 7United Arab Emirates 6 7UK 763 1

––––––––––––––––––––––––––

Total 43,379 24,838––––––––––––––––––––––––––Information about major customers

Revenues of approximately €7.611 million and €6.027 million (2011 – €8.583 million) are derived from twoexternal customers. Revenues of €9.208 million are attributable to the mobile products and services segmentand €4.430 million to software and services segment respectively.

Contract Revenue

Revenue from services is based on the stage of completion determined by reference to services performedto date as a percentage of total services to be performed. At 31 December 2012, the Group has recognized€31,886,484 (2011 – €35,584,485) of contract revenue, of which €9,220,965 (2011 – €9,204,322) had notbeen invoiced by the year end, based on the completion ratio from the rendering of services in relation toprojects with total budgeted revenue of €31,886,484 (100% completion) (2011 – €35,584,485). Total costsincurred relating to these projects were €3,572,535 as at 31 December 2012 (2011 – €14,254,321).

5. Cost of Sales (Continuing operations)



Content costs 166 24Direct staff costs 99 690Third party costs 11,819 5,968Telecom provider costs 3,785 286Amortisation of intangible assets 6,057 3,663

–––––––––––––––––––––––––

Total 21,926 10,631–––––––––––––––––––––––––


6. Operating Income/Expenses (Continuing operations)

Other operating income is derived from:



Exchange differences 360 42Profit on disposal of tangible and intangible fixed assets – 425Other income 344 237

–––––––––––––––––––––––––

Total 704 704–––––––––––––––––––––––––Other operating expenses are derived from:



Various operating expenses – 237Exchange differences – 349

–––––––––––––––––––––––––

Total – 586–––––––––––––––––––––––––7. Distribution Expenses (Continuing operations)



Sales and marketing staff costs 1,044 553Travel and transportation costs 426 283Promotion, exhibitions and other costs 785 979

–––––––––––––––––––––––––

Total 2,255 1,815–––––––––––––––––––––––––


8. Administrative Expenses (Continuing operations)



Administrative staff costs 1,240 359Wages and expenses for contracted third parties 1,617 916Share based payments (note 29) – 256Utilities and rents 664 277Taxes and custom duties 66 43Provisions for impairment of receivables 142 –Depreciation of non-current assets 620 543Other 402 298

–––––––––––––––––––––––––

Total 4,751 2,692–––––––––––––––––––––––––9. Auditors’ Remuneration



Fees payable to the Company’s auditor for the audit of the Parent Company and Consolidated Financial Statements 70 42Audit-related assurance services 22 24Tax compliance services 6 9Tax advisory services 4 –

–––––––––––––––––––––––––

Total 102 75–––––––––––––––––––––––––Fees payable to other auditors:– audit of Company’s subsidiaries 23 24– valuation and actuarial services 12 –

–––––––––––––––––––––––––

Total 35 24–––––––––––––––––––––––––


10. Staff Costs (Continuing operations)



Wages and salaries 4,118 2,667Social security costs 995 576Share based payments – 261Staff retirement indemnities (165) 64

–––––––––––––––––––––––––

Total 4,948 3,568–––––––––––––––––––––––––The Group has capitalised wages and social security costs of €832,367 in the year ended 31 December 2012(year ended 31 December 2011 – €577,842) as software development costs incurred in relation to thedevelopment mainly of commercially viable mobile platforms and services. All other staff costs relating toresearch and development have been recognised in profit or loss.

The average monthly number of people employed by the Group is analysed as follows:


31 December 31 December2012 2011

Number Number

Software development 23 15Project development 109 94Sales 33 24Administration 41 29

–––––––––––––––––––––––––

206 162–––––––––––––––––––––––––Directors’ Remuneration



Salaries, fees and other benefits 814 541–––––––––––––––––––––––––


The remuneration of the highest paid Director amounted to €267,246 (2011 – €212,741).

Salary Otherand fees benefits Total

2012 w’000 w’000 w’000

Gerasimos Bonanos 130 16 146Gavin Burnell 49 – 49Joseph Coughlin 58 – 58Dimitrios Gryparis 168 – 168Barry Arriko 126 – 126Costis Papadimitrakopoulos 223 44 267

–––––––––––––––––––––––––––––––––––––––––

754 60 814–––––––––––––––––––––––––––––––––––––––––Salary Other

and fees benefits Total2011 w’000 w’000 w’000

Gerasimos Bonanos 78 16 94Gavin Burnell 65 – 65Joseph Coughlin 36 – 36Dimitrios Gryparis 69 2 71Brett Miller 47 – 47Barry Arriko 15 – 15Costis Papadimitrakopoulos 172 41 213

–––––––––––––––––––––––––––––––––––––––––

482 59 541–––––––––––––––––––––––––––––––––––––––––Share Options and Warrants Granted to Directors

Share options and warrants granted to the Directors who held office as at 31 December 2012 are set outbelow and further described in note 29 to the Financial Statements. Options and warrants held by Directorswere as follows:

31 December 2012 31 December 2011Exercise Exercise

price priceDate of grant Number per share Number per share

Gerasimos Bonanos 14 December 2007 – – 100,000 20p29 November 2010 500,000 12.5p 500,000 12.5p

Dimitrios Gryparis 14 December 2007 – – 100,000 20p29 November 2010 500,000 12.5p 500,000 12.5p

Costis Papadimitrakopoulos 14 December 2007 – – 100,000 20p29 November 2010 1,500,000 12.5p 1,500,000 12.5p

Costis Papadimitrakopoulos, Gerasimos Bonanos and Dimitrios Gryparis each exercised 100,000 options on10 December 2012. The options had an exercise price of 20 pence per share. The market price when theabove mentioned Directors exercised their share options was 20.12 pence per share.


Brett Miller, a former Director, exercised 200,000 warrants on 5 December 2012, with an exercise price of20 pence per share. He also exercised 1,105,895 warrants on 10 December 2012 with an exercise price of20 pence per share. The market price when Brett Miller exercised his warrants was 22 pence and 20.12 penceper share respectively.

The mid-market price of the Company’s ordinary shares at 31 December 2012 was 21.97p (2011 – 19.88p)Except as noted above, no other Director share options and warrants were forfeited, exercised or expiredduring the period.

11. Finance Costs and Finance Income(Continuing operations)



Finance costsUnsecured loan note 200 –Bank borrowings 109 574

––––––––––––––––––––––––––

Total 309 574––––––––––––––––––––––––––Finance income

Interest receivable (45) (82)––––––––––––––––––––––––––12. Gain on Sale of Subsidiary

On 3 December 2012, the Group sold 51% of its interest in Globo Technologies S.A. for proceeds of€11,200,000, realising a gain of €876,000. The gain from sale comprises the following:

w

Profit on disposal of subsidiary undertaking 447,000Retained interest in former subsidiary undertaking 429,000

––––––––––––

876,000––––––––––––


13. Income Tax



Group

Current tax:

Current tax on profits for the year 1,238 304Adjustment in respect of prior years (285) 149

––––––––––––––––––––––––––

Total current tax 953 453––––––––––––––––––––––––––Deferred tax:

Origination and reversal of temporary differences (note 23) 8 2,721––––––––––––––––––––––––––

Total deferred tax 8 2,721––––––––––––––––––––––––––Tax on continuing operations 675 1,227Tax on discontinued operations 286 1,947

––––––––––––––––––––––––––

Total tax charge 961 3,174––––––––––––––––––––––––––The tax on the Group’s profit before tax differs from the theoretical amount that would arise using theweighted average tax rate applicable to profits/(losses) of the consolidated entities as follows:

Profit before tax per IFRS financial statements(Continuing and discontinued operations) 17,889 12,054

––––––––––––––––––––––––––

Reconciliation of tax charge:Tax at the nominal rate of 20% 3,578 2,411R&D relief – (291)Adjustment to R&D relief in respect of prior years – 900Tax losses for which no deferred tax asset is recognised 549 254Income not subject to tax (3,138) (608)Timing and permanent differences 564 383Tax in foreign jurisdictions calculated at a different tax rate tothe nominal rate (307) (24)Adjustment in respect of prior years (285) 149

––––––––––––––––––––––––––

Tax charge 961 3,174––––––––––––––––––––––––––Tax losses available to be carried forward by the Parent Company at 31 December 2012 against future profitsare estimated to comprise trading losses of approximately €140,000 (2011: € 120,000) arising in the UK and€2,908,000 (2011: €1,683,000) arising in Greece. A deferred tax asset amounting to approximately €32,000(31 December 2011: €30,000) has not been recognised in respect of the Company’s accumulated UK lossesand approximately €582,000 (2011: €337,000) in respect of the Company’s accumulated losses in Greece, asthere is insufficient evidence that the asset will be recovered in the foreseeable future. There were no otherfactors that may affect future tax charges.


The Group has utilised tax relief incentives provided by the Cypriot and Greek tax jurisdictions. Theseincentives allow for special treatment on intellectual property and investments made by eligible companies.

The Cypriot tax law on “Intellectual Property Rights” gives rise to the following tax treatment:

• The cost of the acquisition or development of intangible assets (being of a capital nature) is amortisedequally over a five year period. This is applicable to any company carrying on a business for theacquisition or development of intangible assets as defined in Patent Law, Intellectual Property RightsLaw and Trademark Law.

• 80% of the profit arising from the use of the intangible assets, as well as any profit on their sale, isdeemed as an expense in determining taxable income.

• The 80% deduction applies to profit after deducting all direct expenses such as amortisation, interestexpense to finance the acquisition or development of the assets as well as any other direct expenses.

a) Untaxed Reserves

“Untaxed reserves” are used to reduce the Group’s taxable profit according to the relevant investmentpercentage. This percentage is calculated on realised investments and usually varies from 50% to 60%. Theresult of this calculation is the untaxed reserve, which is deducted from the taxable profit and is not subjectto tax. This reserve is for re-investment into the business. If the untaxed reserve is distributed to shareholders,the tax becomes payable. Otherwise it remains indefinitely as a special reserve. The Group has utilised threedevelopment Greek laws, L. 1828/1989, L. 2601/1998 and L. 3220/2004.

b) Non-Taxable Discounts

The Group has implemented Greek Law 3296/2004 (ex. L. 2992/2002), to reduce its tax obligations by 50%for expenses related to research and development for software products. No tax credit (2011: €291,000) hasbeen recognised in respect of the Group’s tax credit claim for research and development expenditure. Inaccordance with Greek Tax Law, fifty per cent of eligible expenditure on scientific and technological research(such expenditure being capitalised within intangible fixed assets) is eligible as a deduction from Greek GAAPtaxable profits for a maximum period of five years.

14. Earnings per Share

Basic earnings per share is calculated by dividing the profit after tax attributable to equity holders of theCompany by the weighted average number of ordinary shares in issue during the year.


31 December 31 December2012 2011

Profit attributable to equity holders of the Company (€000’s) 17,804 8,800Weighted average number of ordinary shares in issue 319,707,398 275,937,451–––––––––––––––––––––––––––

Diluted earnings per share in the year ended 31 December 2012 and 31 December 2011 assumes that optionsand warrants outstanding at 31 December 2012 were exercised at 1 January 2012, for options and warrantswhere the exercise price was less than the average price of the ordinary shares during the period. A calculationis done to determine the number of shares that could have been acquired at fair value based on the monetaryvalue of the subscription rights to outstanding share options. The number of shares calculated above iscompared with the number of shares that would have been issued assuming the exercise of the options andwarrants. On this basis, the calculation of diluted earnings per share is based on the profit attributable toordinary shareholders divided by 320,807,200 shares (31 December 2011 – 277,668,873 shares).

Details of a share issue since the year end, which may result in the dilution of earnings per share in thefuture, is disclosed in note 26 of the Financial Statements. Basic and diluted earnings per share fromdiscontinued operations are disclosed in note 15 of the Financial Statements.


15. Discontinued Operations

On 3 December 2012 the Group disposed of 51 per cent of its subsidiary Globo Technologies S.A. (“GloboTechnologies”), comprising all Greek-related e-business software operations, to Zipersi Consulting Limited, acompany owned and controlled by Globo Technologie’s management team, for a total consideration of€11,200,000 plus any outstanding intra group balances at that date. As from 3 December 2012, the fivemember Board of Directors of Globo Technologies includes three members appointed by Zipersi ConsultingLimited and two by the Group.

Globo Technologies operates in Greece and includes the Group’s traditional e-business software, digitalisationand software integration businesses, which interact with Greek private and public organisations. All IntellectualProperty Rights, patents and trademarks that relate to the mobile, S.a.a.S and telecom businesses of theGroup remain fully owned by the Group and the divested entity has no claims over these assets.

The total consideration of €11,200,000 is receivable as follows: €1,000,000 on 15 January 2013, €500,000on 31 December 2013, €500,000 on 30 June 2014, €1,000,000 on 31 December 2014, €1,500,000 on 30 June2015, €1,500,000 on 31 December 2015, €1,500,000 on 30 June 2016 and €3,700,000 on 31 December2016. Interest at the rate of 5 per cent per annum is payable on the above instalments. The Group received€400,000 of the instalment due on 15 January 2013 prior to the year end. As security for the deferredconsideration, Zipersi Consulting Limited has provided the Group with a pledge over the shares under sale.If Zipersi Consulting Limited falls into arrears on the repayments, then the entire remaining considerationbecomes immediately due. Each completed instalment will result in the partial release of the Group’s pledgeover the shares.

After initial measurement, the deferred consideration receivable is recorded at amortised cost using theeffective interest rate (“EIR”) method, less impairment. In arriving at amortised cost the Directors havediscounted the future cash receipts based on an EIR advised by independent experts Nexia Eurostatus S.A.and Grant Thornton Greece, who concluded a rate in the range of 4.5 per cent to 5.5 per cent. A rate of5 per cent has been applied by the Directors.

The major classes of assets and liabilities of Globo Technologies disposed of were as follows:


AssetsProperty, plant and equipment 2,461 3,734Intangible assets 2,695 13,366Investment in subsidiaries – 1,516Other non-current assets 72 60

––––––––––––––––––––––––––

Total non-current assets 5,228 18,676––––––––––––––––––––––––––

Inventories 3,447 4,840Trade receivables (includes intra group balances) 29,702 16,060Other receivables 1,047 1,453Other current assets 10,354 13,747Cash and cash equivalents 7,061 8,256

––––––––––––––––––––––––––

Total current assets 51,611 44,356––––––––––––––––––––––––––

Total assets 56,839 63,032––––––––––––––––––––––––––



Non-current liabilitiesFinance lease liabilities 1,431 1,509Borrowings 3,300 2,250Deferred tax liabilities 559 1,022Retirement benefit obligations 262 262Other provisions 50 50

–––––––––––––––––––––––––

Total non-current liabilities 5,602 5,093–––––––––––––––––––––––––

Current liabilities (includes intra group balances)Trade and other payables 7,996 10,259Income tax 832 109Taxes payable 415 162Borrowings 3,989 5,100Other short term liabilities 16,920 21,085

–––––––––––––––––––––––––

Total current liabilities 30,152 36,715–––––––––––––––––––––––––

Total liabilities 35,754 41,808–––––––––––––––––––––––––Net assets 21,085 21,224–––––––––––––––––––––––––

The results of Globo Technologies are presented below:

Period ended Year ended30 November 31 December

2012 2011w’000 w’000

Revenue 12,049 17,776Expenses (10,787) (17,123)Finance costs (net) (591) (622)

–––––––––––––––––––––––––

Profit before tax from discontinued operations 671 31Income tax (286) (1,947)Gain on sale of subsidiary (note 12) 876 –

–––––––––––––––––––––––––

Profit/(loss) from discontinued operations 1,261 (1,916)–––––––––––––––––––––––––Earnings per share from discontinued operations(w per share):

Basic 0.002 (0.001)Diluted 0.002 (0.001)–––––––––––––––––––––––––


The net cash flows incurred by Globo Technologies are as follows:

2012 2011w’000 w’000

Operating cash flows (8,554) 19,205Investing cash flows 7,499 (9,844)Financing cash flows (139) (3,754)

–––––––––––––––––––––––––

Net cash (outflow)/inflow (1,194) 5,607–––––––––––––––––––––––––Analysis of Cash Flows on DisposalCash received – partial payment of initial instalment 400Cash and cash equivalents disposed of with the subsidiary (7,061)

––––––––––––––

Net cash flow on disposal (6,661)––––––––––––––16. Property, Plant and Equipment

Group

Officefurniture,

fittings andLand Property Vehicles equipment Totalw’000 w’000 w’000 w’000 w’000

CostAs at 1 January 2011 736 986 95 5,290 7,107Additions – 276 32 1,463 1,771Disposals – – (2) (55) (57)

––––––––––––––––––––––––––––––––––––––––––––––––––––––

As at 31 December 2011 736 1,262 125 6,698 8,821

Additions – 134 52 314 500Disposals – – – (27) (27)Acquisition of subsidiary (note 20) – – – 6 6Disposal of subsidiary (note 15) (736) (1,045) (154) (5,384) (7,319)

––––––––––––––––––––––––––––––––––––––––––––––––––––––

As at 31 December 2012 – 351 23 1,607 1,981––––––––––––––––––––––––––––––––––––––––––––––––––––––


Officefurniture,

fittings andLand Property Vehicles equipment Totalw’000 w’000 w’000 w’000 w’000

Accumulated DepreciationAs at 1 January 2011 – (201) (31) (3,400) (3,632)Charge for the year – (44) (12) (947) (1,003)Disposals – – – 51 51As at 31 December 2011 – (245) (43) (4,296) (4,584)Charge for the year – (81) (16) (828) (925)Disposal of subsidiary (note 15) – 257 59 4,542 4,858

––––––––––––––––––––––––––––––––––––––––––––––––––––––

As at 31 December 2012 – (69) – (582) (651)––––––––––––––––––––––––––––––––––––––––––––––––––––––Net Book Value at 1 January 2011 736 785 64 1,890 3,475––––––––––––––––––––––––––––––––––––––––––––––––––––––Net Book Value at31 December 2011 736 1,017 82 2,402 4,237––––––––––––––––––––––––––––––––––––––––––––––––––––––Net Book Value at31 December 2012 – 282 23 1,025 1,330––––––––––––––––––––––––––––––––––––––––––––––––––––––The net book value and depreciation charge of each class of asset treated as held under finance leases isas follows:

Net book value at31 December 2012 – – – – –––––––––––––––––––––––––––––––––––––––––––––––––––––––Net book value at31 December 2011 736 721 74 185 1,716––––––––––––––––––––––––––––––––––––––––––––––––––––––Depreciation charge for the year – 23 46 161 230––––––––––––––––––––––––––––––––––––––––––––––––––––––All finance lease assets previously held related to Globo Technologies S.A. which was disposed of duringthe year.


17. Intangible Assets

Group

Software Licences Royalties Totalw’000 w’000 w’000 w’000

CostAs at 1 January 2011 8,923 24,471 370 33,764Additions 4,498 8,251 – 12,749Disposals (1,423) – – (1,423)

––––––––––––––––––––––––––––––––––––––––––––––––––––––

As at 31 December 2011 11,998 32,722 370 45,090Additions 4,798 6,408 – 11,206Acquisition of subsidiary (note 20) 618 – – 618Disposal of subsidiary (note 15) (3,184) (8,962) (273) (12,419)

––––––––––––––––––––––––––––––––––––––––––––––––––––––

As at 31 December 2012 14,230 30,168 97 44,495––––––––––––––––––––––––––––––––––––––––––––––––––––––

Accumulated AmortisationAs at 1 January 2011 (3,979) (14,957) (342) (19,278)Amortisation for the year (2,064) (4,379) (28) (6,471)Disposals 452 – – 452

––––––––––––––––––––––––––––––––––––––––––––––––––––––

As at 31 December 2011 (5,591) (19,336) (370) (25,297)––––––––––––––––––––––––––––––––––––––––––––––––––––––Amortisation for the year (4,336) (3,465) – (7,801)Disposal of subsidiary (note 15) 3,055 6,396 273 9,724

––––––––––––––––––––––––––––––––––––––––––––––––––––––

As at 31 December 2012 (6,872) (16,405) (97) (23,374)––––––––––––––––––––––––––––––––––––––––––––––––––––––

Net Book Value at 1 January 2011 4,944 9,514 28 14,486––––––––––––––––––––––––––––––––––––––––––––––––––––––Net Book Value at 31 December 2011 6,407 13,386 – 19,793––––––––––––––––––––––––––––––––––––––––––––––––––––––Net Book Value at 31 December 2012 7,358 13,763 – 21,121––––––––––––––––––––––––––––––––––––––––––––––––––––––

Licences include development costs comprising the direct staff costs of the software development teamincurred in the development of software products and third party development costs of software libraries andmodules, incorporated into the Group’s products.

The Group continues to capitalise costs incurred on newly developed software products as well as onupgrading and developing existing products, until the products are ready for use and sale at which point thecosts will be amortised in accordance with the Group’s accounting policy.

All intangible assets except royalties are internally generated. Additions to internally generated intangibleassets totalled €11,204,000 (2011: €12,749,000).

Amortisation is included in cost of sales in the Statement of Comprehensive Income.


18. Investment in Subsidiary Undertakings

Company

Shares in Group Undertakings


At the beginning of the year 7,403 4,855Acquisition (note 20) 595 –Additional investments in subsidiary undertakings 272 2,127Exchange differences 174 165Capital contribution relating to share-based payments (208) 256

––––––––––––––––––––––––––––

At the end of the year 8,236 7,403––––––––––––––––––––––––––––Details of Subsidiary and Associate Undertakings

Proportion of ProportionCountry of equity shares of equityincorporation directly held shares held

Name and residence Nature of business by Company by Group

SubsidiariesProfitel Communications S.A. Greece Business communication 0% 100%

servicesGlobo Mobile S.A. Greece Mobile software solutions 0% 100%

and servicesGlobo IT and Telecom Romania Computer programming, 0% 100%Services SRL consultancy and related

activitiesReachFurther Cyprus Content/service aggregator 0% 100%Communications Limited for the entire mobile and

fixed telecommunication markets

Globo Holdings Limited BVI Holding of investments 100% 0%Globo Services (CY) Limited Cyprus e-Business and mobile 100% 0%

software solutionsGMIP Limited (formerly Cyprus Holding of Intellectual 100% 0%Gylenhall Investments Limited) PropertyGlobo EMEA Holdings Limited Cyprus Holding of investments 100% 0%(formerly Oumpalumpa Limited)Globo Mobile Technologies UAE Mobile software 0% 100%International FZ-LLC solutions and servicesGlobo International LLC USA Mobile software 0% 100%

solutions and servicesGlobo US Holdings LLC USA Holding of investments 100% 0%Globo Mobile Inc. USA Business communication 0% 100%

servicesAssociateGlobo Technologies S.A. Greece E-business solutions 0% 49%

Investments in subsidiaries are recorded at cost, which is the fair value of consideration paid.


19. Goodwill

Goodwillw’000

GroupAs at 1 January 2011 842Impairment (100)

––––––––

As at 31 December 2011 742––––––––As at 31 December 2012 742––––––––

Annual test for impairment

No impairment to goodwill arose during the year (2011 – impairment €100,000). Goodwill is allocated to theGroup’s cash generating units (“CGUs”). The Directors’ calculations when carrying out the impairment reviewon the goodwill relating to ReachFurther Communications Limited of €548,000 used pre-tax operating cashflow projections based on financial budgets approved by management, covering a two year period. Cashflows beyond the two year period are extrapolated using a growth rate of 12% per annum for a three yearperiod. The key assumptions used for the value-in-use calculation are as follows:

Market risk premium – 9%Beta factor – 0.72Risk free rate – 14%Cost of debt – 6%Discount rate – 11.53%

Management has determined the budgeted operating cash flows based on past performance and expectationsof market development, consistent with expectations in the industry. The values in use calculated exceed thecarrying amounts by €1.377 million.

The value in use calculation is sensitive to changes in the assumptions for growth rate and discount rate. Ifthe growth rate, as applied to the value in use calculations explained above, did not meet the expected rateof 12% per annum, goodwill would become equal to the value in use calculation at a growth rate of 6.94%per annum, assuming all other assumptions remained constant. Goodwill would become equal to the valuein use at a discount rate between 23% and 24%.

20. Business Combinations - Acquisition in 2012

On 8 February 2012, the Group acquired 100% of the equity share capital of Dialect Technologies Inc.(subsequently renamed Globo Mobile Inc.) for a total cash and deferred consideration of €595,000 (equivalentto US$800,000) of which US$500,000 is payable in cash and the remainder is contingent on achieving theearn-out targets set out in the purchase agreement (see note 36).


The fair value of the identifiable assets and liabilities acquired and their carrying amounts immediately priorto the acquisition, were as follows:

Fair value Book valuew’000 w’000

Property, land and equipment (note 15) 6 6Intangible assets (note 16) 618 373Receivables 87 94Cash and cash equivalents 1 1Trade and other payables (117) (117)

––––––––––––––––––––––––––––

595 357––––––––––––––––––––––––––––The intangible assets that are presented in the table consist of software systems that are specially developedfor Dialect Technologies Inc. These systems are major components for the functionality of the subsidiary andits future business development. Dialect Technologies Inc. has no other intangible assets in its possession.

Details of net assets acquired and goodwill are as follows:

w’000

Net assets acquired 595Goodwill –

––––––––

Consideration 595––––––––From the date of acquisition, Dialect Technologies Inc. has contributed €3,600,000 of revenue and made aloss before tax of €724,000 attributable to the continuing operations of the Group. If the combination hadtaken place at the beginning of the year, revenue from continuing operations for the Group would have been€46,010,000 and the profit before tax from continuing operations for the Group would have been €17,213,000.

Purchase Consideration w’000

Cash payable 209Contingent consideration liability (note 36) 386

––––––––

Total consideration 595––––––––Analysis of Cash Flows on AcquisitionCash paid (260)Net cash acquired with the subsidiary 57

––––––––

Net cash flow on acquisition (203)––––––––


21. Investment in an Associate


At the beginning of the year – –Addition – fair value of 49% retained interest 10,761 –Share of loss (297) –

––––––––––––––––––––––––––––

At the end of the year 10,464 –––––––––––––––––––––––––––––The Group has a 49% interest in Globo Technologies S.A., which is involved in e-business software,digitalisation and software integration services. Globo Technologies S.A. is not listed on any public exchange.

The following table illustrates the summarised financial information of the Group’s investment in GloboTechnologies S.A.:

2012Share of the Associate’s Statement of Financial Position w’000

Current assets 18,119Non-current assets 2,997Current liabilities (8,757)Non-current liabilities (1,895)

––––––––

Carrying amount of investment 10,464––––––––

Share of Associate’s Revenue and Profit/(Loss)Revenue 810

––––––––

Profit/(loss) (297)––––––––22. Financial Instruments by Category

31 December 2012

Group

Loans and Available-Receivables for-sale Total

w’000 w’000 w’000

Assets per Balance SheetTrade and other receivables, excluding prepayments 29,599 – 29,599Other current assets 9,029 – 9,029Cash and cash equivalents 19,174 – 19,174

––––––––––––––––––––––––––––––––––––––––––––

Total 57,802 – 57,802––––––––––––––––––––––––––––––––––––––––––––


31 December 2012

Liabilities atAmortised

Costw’000

Liabilities per Balance SheetBorrowings (excluding finance lease liabilities) 5,023Finance lease liabilities –Trade and other payables, excluding non-financial liabilities 5,656

––––––––––––

Total 10,679––––––––––––31 December 2011

Group

Loans and Available-Receivables for-sale Total

w’000 w’000 w’000

Assets per Balance SheetAvailable-for-sale financial assets – 45 45Trade and other receivables, excluding prepayments 25,409 – 25,409Other current assets 13,952 – 13,952Cash and cash equivalents 9,338 – 9,338

––––––––––––––––––––––––––––––––––––––

Total 48,699 45 48,744––––––––––––––––––––––––––––––––––––––31 December 2011

Group


Costw’000

Liabilities per Balance SheetBorrowings (excluding finance lease liabilities) 8,495Finance lease liabilities 1,697Trade and other payables, excluding non-financial liabilities 10,716

––––––––––––

Total 20,908––––––––––––


31 December 2012

Company

Loans andReceivables Total

w’000 w’000

Assets per Balance Sheet

Other receivables, excluding prepayments 29,219 29,219Cash and cash equivalents 7,981 7,981

––––––––––––––––––––––––––––––

Total 37,200 37,200––––––––––––––––––––––––––––––31 December 2011

Company

Loans andReceivables Total

w’000 w’000

Assets per Balance SheetOther receivables, excluding prepayments 22,743 22,743Cash and cash equivalents 237 237

––––––––––––––––––––––––––––––

Total 22,980 22,980––––––––––––––––––––––––––––––Credit Quality of Financial Assets

The credit quality of financial assets which are neither past due nor impaired can be assessed by referenceto historical information about counterparty default rates.

The Group categorises its trade receivables under the following:

Group 1: new customers/related parties (less than 6 months)

Group 2: existing customers/related parties (more than 6 months) with no defaults in the past

Group

Trade Receivables and post dated cheques received

2012 2011w’000 w’000

Counterparties without external credit ratingGroup 1 507 10,495Group 2 14,599 11,983

––––––––––––––––––––––––––––––

Total 15,106 22,478––––––––––––––––––––––––––––––


31 December 2012

Company


Costw’000

Liabilities per Balance SheetBorrowings (excluding finance lease liabilities) 3,921Trade and other payables, excluding non-financial liabilities 159

––––––––––––

Total 4,080––––––––––––31 December 2011

Company


Costw’000

Liabilities per Balance SheetBorrowings (excluding finance lease liabilities) –Trade and other payables, excluding non-financial liabilities 55

––––––––––––

Total 55––––––––––––23. Deferred Income Taxes

Deferred income taxes are calculated in full on temporary differences under the liability method using aprincipal tax rate in 2012 of 20% (2011: 20%).

The movement on the deferred income tax account is as follows:


At the beginning of the year (2,319) 402Income statement charge (note 13) (8) (2,721)Disposal of subsidiary undertaking 559 –

––––––––––––––––––––––––––––––

At the end of year (1,768) (2,319)––––––––––––––––––––––––––––––


The movement in deferred tax assets and liabilities during the year, without taking into consideration theoffsetting of balances within the same tax jurisdiction, is as follows:

At (Charged)/ At1 January Credited to Disposal of 31 December

2012 profit or loss subsidiary 2012w’000 w’000 w’000 w’000

Deferred tax liabilitiesTangible assets (69) 32 27 (10)Intangible assets-capitalised costs (855) 3 1 (851)Receivables (15) 15 – –IAS 11 revenue recognition (2,682) (23) 1,472 (1,233)Work in progress – (647) 647 –Provisions – (11) – (11)

––––––––––––––––––––––––––––––––––––––––––––––––––––––

Subtotal (3,621) (631) 2,147 (2,105)––––––––––––––––––––––––––––––––––––––––––––––––––––––Deferred tax assetsFinance leases – 23 (23) –Tangible assets 2 (2) – –Inventory 7 – (7) –Receivables 329 95 (402) 22Staff indemnities – 315 (315) –Deferred income 102 132 (234) –Unused tax losses 831 60 (576) 315Trade and other payables 31 – (31) –

––––––––––––––––––––––––––––––––––––––––––––––––––––––

Subtotal 1,302 623 (1,588) 337––––––––––––––––––––––––––––––––––––––––––––––––––––––

Deferred tax assets/(liabilities) (2,319) (8) 559 (1,768)––––––––––––––––––––––––––––––––––––––––––––––––––––––At (Charged)/ At

1 January Credited to 31 December2011 profit or loss 2011w’000 w’000 w’000

Deferred tax liabilitiesTangible assets (3) (66) (69)Intangible assets-capitalised costs (382) (473) (855)Receivables – (15) (15)IAS 11 revenue recognition (1,265) (1,417) (2,682)Prepayments and accrued income (103) 103 –

––––––––––––––––––––––––––––––––––––––

Subtotal (1,753) (1,868) (3,621)––––––––––––––––––––––––––––––––––––––


At (Charged)/ At1 January Credited to 31 December

2011 profit or loss 2011w’000 w’000 w’000

Deferred tax assetsIntangible assets-capitalised costs 210 (210) –Finance leases 7 (7) –Tangible assets – 2 2Inventory 7 – 7Receivables 216 113 329Staff indemnities 1 (1) –Deferred income 106 (4) 102Unused tax losses 1,574 (743) 831Trade and other payables 34 (3) 31

––––––––––––––––––––––––––––––––––––––

Subtotal 2,155 (853) 1,302––––––––––––––––––––––––––––––––––––––

Deferred tax assets/(liabilities) 402 (2,721) (2,319)––––––––––––––––––––––––––––––––––––––Deferred income tax assets and liabilities are offset in accordance with the legally enforceable right to set offcurrent tax assets against current tax liabilities and because the deferred income taxes relate to the samefiscal authority. Deferred income tax liabilities of approximately €3,935,000 (2011: €620,000) have not beenrecognised for tax that would be payable on the unremitted earnings of certain subsidiaries as the Groupintends to fully re-invest these earnings. Unremitted earnings totalled €19.675 million at 31 December 2012(2011: €3.1 million).

24. Inventories and Work in Progress

Group


2012 2011w’000 w’000

Products – 2Traded goods 143 254Work in progress 4,394 4,675

––––––––––––––––––––––––––Total 4,537 4,931Less: provisions (for obsolete goods) – (31)

––––––––––––––––––––––––––

4,537 4,900––––––––––––––––––––––––––Work in progress relates to expenditure incurred by the Group, consisting of services either provided orcontracted by the year end with third party suppliers, where the Group has been successful in winning tendersbut contracts with customers have either not been signed, or where project implementation has been delayed.


25. Trade Receivables

Group


2012 2011w’000 w’000

Trade receivables 15,984 18,615Post dated cheques received 756 7,428Notes receivables 5 –Less: provision for impairment of receivables (114) (1,721)

––––––––––––––––––––––––––

Trade receivables – net 16,631 24,322Advance payments to subcontractors and suppliers 1,780 839Less: provision for impairment – (159)

––––––––––––––––––––––––––

18,411 25,002––––––––––––––––––––––––––Trade receivables comprise customer receivables in credit and post dated cheques received. The Group retainsall risks associated with post-dated cheques received until the funds clear the bank on the presentation date.Included in the Group’s trade receivables balance are debtors with a carrying amount of €3,337,126(2011: €3,725,648) which are past due at the reporting date for which the Group has not provided as therehas not been a significant change in credit quality and the amounts are still considered recoverable.

Ageing of trade receivables (net)

As at 31 December As at 31 December2012 2011w’000 w’000

Between BetweenUp to 3 Up to 9 9 and 12 Over 12 Up to 3 Up to 9 9 and 12 Over 12months months months months months months months months

Trade receivables from customers 10,930 1,799 1,708 1,433 11,950 2,921 1,823 1,844Trade receivables from post

dated cheques 97 467 105 92 3,367 2,358 59 –––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

11,027 2,266 1,813 1,525 15,317 5,279 1,882 1,844––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––As at 31 December 2012, trade receivables from customers of €14,437,000 (2011: €16,694,000) were fullyperforming. As of 31 December 2012, trade receivables over 12 months of €1,433,000 (2011: €1,844,000)were past due but not impaired. These relate to existing customers for whom there is no history of default.


Movement on the Group provision for impairment of trade receivables and advance payments is as follows:


2012 2011w’000 w’000

At 1 January 1,880 1,251Provision for receivables impairment – (33)Disposal of Globo Technologies S.A. (1,880) –Post dated cheques receivable provided for 115 662

––––––––––––––––––––––––––

At 31 December 115 1,880––––––––––––––––––––––––––The individually impaired receivables relate to customers who are perceived to be in financial difficulty andthe amounts are not considered recoverable. The creation and release of the provision for impaired receivablesis included in administrative expenses.

The carrying amount of the Group’s trade receivables, advance payments and other receivables aredenominated in the following currencies:


2012 2011w’000 w’000

UK Pound – 23Euros 31,922 25,416US Dollars 177 3Other currencies 12 12

––––––––––––––––––––––––––

32,111 25,454––––––––––––––––––––––––––The maximum exposure to credit risk at the reporting date is the carrying value reported above.

26. Other Receivables

Group


2012 2011w’000 w’000

Non-CurrentProceeds from disposal of subsidiary (note 15) 9,700 –Other receivables 22 66

––––––––––––––––––––––––––

9,722 66––––––––––––––––––––––––––



2012 2011w’000 w’000

CurrentCalled-up share capital not paid 879 –VAT recoverable 142 –Other receivables 365 290Securities – 45Claims from Government 23 117Proceeds from disposal of subsidiary (note 15) 1,100 –Receivables from related parties 1,491 –

––––––––––––––––––––––––––

4,000 452––––––––––––––––––––––––––Company


2012 2011w’000 w’000

Receivables from related parties 29,211 22,618Called up share capital not paid 879 –Other receivables 8 125Prepayments 25 32

––––––––––––––––––––––––––

30,123 22,775––––––––––––––––––––––––––On 7 December 2012, 1,720,000 options and 1,105,895 warrants were exercised at 20 pence per share anda further 2,114,000 options were exercised at 12.5 pence per share. Proceeds from the exercise of 400,000options at 20 pence per share and from the exercise of 254,000 options at 12.5 pence per share were receivedprior to the year end. All amounts due in connection with called up share capital not paid were received inJanuary 2013.

27. Other Current Assets

Group


2012 2011w’000 w’000

Prepayments 2,222 4,084Accrued income and Amounts recoverable on long term contracts 9,029 13,952

––––––––––––––––––––––––––

11,251 18,036––––––––––––––––––––––––––


28. Cash and Cash Equivalents

Group


2012 2011w’000 w’000

Cash at bank 19,144 9,163Cash in hand 30 175

––––––––––––––––––––––––––

19,174 9,338––––––––––––––––––––––––––Company


2012 2011w’000 w’000

Cash at bank 7,981 237––––––––––––––––––––––––––The Group holds bank accounts with several banks in UK, Switzerland, USA, Dubai, Greece and Cyprus. At31 December 2012, the Group held cash in banks with the following credit ratings:


2012 2011w’000 w’000

Credit rating

Aa3 7,990 243BB+ 408 154B3,B 10,746 8,766

––––––––––––––––––––––––––––

19,144 9,163––––––––––––––––––––––––––––Cash and cash equivalents include €472,223 (2011: €Nil) against credit line facilities. As at 31 December2011, cash and cash equivalents included €774,894 of guarantees held in connection with certain publicsector contracts. These funds were not available for use by the Group until the expiry date of thoseguarantees.


29. Ordinary Shares

Allotted, Called up and Fully Paid

Ordinary SharesNominal

valueNumber w’000

At 1 January 2011 – shares of 1p each 174,997,755 2,296Changes in the period 120,810,988 1,414

––––––––––––––––––––––––––––

At 31 December 2011 – shares of 1p each 295,808,743 3,710––––––––––––––––––––––––––––

Changes in the period 41,479,518 514––––––––––––––––––––––––––––

At 31 December 2012 – shares of 1p each 337,288,261 4,224––––––––––––––––––––––––––––On 27 April 2012 and 10 May 2012, the Company issued 14,092,132 and 22,247,491 ordinary sharesrespectively of 1p each at 26.5p per share fully paid via a placing. On 5 December 2012, the Company issued200,000 shares of 1p each at 20p per share fully paid pursuant to the exercise of warrants. On 7 December2012, the Company issued 2,114,000 shares at 12.5p and 1,720,000 shares at 20p per share fully paidpursuant to the exercise of share options and 1,105,895 shares at 20p per share fully paid pursuant to theexercise of warrants.

Group

Ordinary ShareNumber of shares premium

shares w’000 w’000

At 1 January 2011 174,997,755 2,296 8,499New shares issued 120,810,988 1,414 18,732

–––––––––––––––––––––––––––––––––––––––––––

At 31 December 2011 295,808,743 3,710 27,231–––––––––––––––––––––––––––––––––––––––––––New shares issued 41,479,518 514 11,836

–––––––––––––––––––––––––––––––––––––––––––

At 31 December 2012 337,288,261 4,224 39,067–––––––––––––––––––––––––––––––––––––––––––Share Options and Warrants

Warrants Issued on Admission to AIM

On 15 November 2007, conditional upon and with effect from admission to AIM, the Company granted Ruegg& Co Limited warrants to subscribe for 1,305,895 ordinary shares. On 1 July 2009 these were assigned toBrett Miller. The exercise price for these warrants is 20p per ordinary share effective from the date of grant.The warrants were fully exercised during the year prior to their expiry date of 14 December 2012.

Share Options Plan

The Company has one share option scheme. The Globo plc Share Option Plan (Part I) applies to employeesof the Group and The Globo plc Share Option Plan (Part II) applies to employees and non-employees of theGroup. The maximum number of ordinary shares to be made available under the Option Plan shall not exceed5% of the Company’s issued ordinary share capital. The Company granted options to subscribe for 2,110,000ordinary shares under Part I on 14 December 2007 of which 270,000 had lapsed by 31 December 2011. The


exercise price for these options is 20p per ordinary share effective from one year from the date of grant. On7 December 2012, 1,720,000 options were exercised and the remaining 120,000 options lapsed on the expirydate of 14 December 2012.

On 26 November 2010 the Company issued 5,250,000 share options under Part II of the Globo plc ShareOption Plan. The options are exercisable at 12.5p per share during a 4 year period commencing 26 November2011. 2,114,000 of the share options granted on 26 November 2010 were exercised on 7 December 2012.A further 150,000 options lapsed during the year.

Disclosures for Share Options and Warrants

Year ended Year ended31 December 2012 31 December 2011

No. of options Weighted No. of options Weightedand warrants average price and warrants average price

(in pence) (in pence)

Outstanding at beginning of year 7,929,895 15.5 8,790,895 15.1Granted during the year – – 1,449,988 15.0Exercised during the year (5,139,895) 16.9 (2,310,988) 13.6Lapsed during the year (270,000) 15.8 – –

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Outstanding at end of year 2,520,000 12.5 7,929,895 15.5––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––Exercisable at end of year 2,520,000 12.5 7,929,895 15.5––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

The warrants and options outstanding at 31 December 2012 had a weighted average remaining contractuallife of 2.90 years (2011 – 2.73 years).

The Group is required to recognise an expense for all share based payments. The fair value of the warrantsand options has been measured by use of the Black-Scholes pricing model. For all other warrants and options,the expected volatility was determined by calculating the historical volatility of the Company’s share pricesince its admission to the AIM market.

The significant inputs into the model were as follows:

15 December 14 December 14 December 26 November 2007 2007 2007 2010

Shares under option 1,305,895 652,947 1,970,000 5,250,000Share price at grant date (pence) 15.2p 15.2p 15.2p 12.3pExercise price 20p 20p 20p 12.5pExercisable from (years) Nil 1 1 1Option life (years) 5 4 5 5Risk free rate 4.27% 4.27% 4.27% 1.88%Expected volatility 14.39% 14.39% 14.39% 55.34%Expected dividend Nil Nil Nil NilFair value per option granted 1.56p 1.12p 1.56p 5.33pForfeiture rate Nil Nil Nil Nil

The total fair value has been spread over the relevant vesting periods and has resulted in a charge to profitor loss for the year ended 31 December 2012 of €nil (2011 – €256,000). This amount has been included inadministrative expenses.


30. Other reserves

Group

Other reserves are analysed as follows:

TransactionFinancial with non- Shares

Ordinary Untaxed means controlling Other Merger to beReserves reserves reserves interest reserves reserve issued Totalw’000 w’000 w’000 w’000 w’000 w’000 w’000 w’000

Balance at 1 January 2011 179 3,530 (46) 483 1,500 142 5,788Share based payment charge – – – – – – 256 256Increase in ownership interest – – – (564) – – – (564)

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Balance at 31 December 2011 179 3,530 (46) (564) 483 1,500 398 5,480

Transfer on exercise of options and warrants – – – – – – (259) (259)

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Balance at 31 December 2012 179 3,530 (46) (564) 483 1,500 139 5,221–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

In accordance with the provisions of Greek company law the “ordinary reserve” has been created through acompulsory transfer of an amount equal to 5 per cent of the annual profit after tax, until such time as thereserve reaches the equivalent of one third of the share capital. The “ordinary reserve” can be distributedonly upon the dissolution of the Greek companies but can be utilised to offset accumulated losses.

The “untaxed reserves” have been created in the periods from 2002 onwards, as a result of tax legislation.This permits the indefinite deferral of tax on otherwise taxable profits, as a form of an investment incentive,on the condition that the said profits are reinvested into the business. Tax deferred in this way is crystallisedon the disposal of the assets acquired, within a period of 5 years from their acquisition, or whenever theuntaxed reserves are distributed. The tax liability that will crystallise on the distribution of these reserves,estimated, as at 31 December 2012 is €633,000 (31 December 2011 – €633,000) and shall be recognised asand when a decision to distribute these reserves, in full or in part, is taken.

The “financial means reserve” has been created as a result of the loss from selling the shares of subsidiarycompany 3nSold S.A. at a lower value than that at which it was acquired. This reserve will remain for anindefinite period until the loss is recovered by profits from selling shares or at the dissolution of the Greekcompanies (at which time it will be offset with any “ordinary reserve” in existence at the time).

The “other reserves” are undistributed post tax profits which can be used to increase the share capital ofGreek companies or can be distributed to the shareholders at any time without any tax obligation. The useof this reserve is subject to the decision of a general meeting.


Company

Other reserves are analysed as follows:

Merger Shares to reserve be issued Totalw’000 w’000 w’000

Balance at 1 January 2011 1,500 134 1,634Changes within the yearShare based payment charge – 256 256

––––––––––––––––––––––––––––––––––––––

Balance at 31 December 2011 1,500 390 1,890

Changes within the yearTransfer on exercise of options and warrants – (258) (258)

––––––––––––––––––––––––––––––––––––––

Balance at 31 December 2012 1,500 132 1,632––––––––––––––––––––––––––––––––––––––31. Borrowings

Group

Loans have been provided to the Group by Greek banks, which are denominated in Euros, and through theissue of unsecured loan notes to various investors, which are denominated in Sterling. The amounts payablewithin one year of the balance sheet date are reported as short-term loans while the amounts repayable ata subsequent stage, are reported as long-term loans.

The bank loans and unsecured loan notes of the Group are analysed as follows:


2012 2011w’000 w’000

Current LiabilitiesShort-term loan financing – 3,875Long term bank loans payable within one year 890 1,396Finance lease liabilities payable within one year – 188

–––––––––––––––––––––––––

Total Current Borrowings 890 5,459–––––––––––––––––––––––––Non-Current LiabilitiesUnsecured loan notes 3,921 –Long term bank loans 212 3,224Finance lease liabilities – 1,509

–––––––––––––––––––––––––

Total Non-Current Borrowings 4,133 4,733–––––––––––––––––––––––––

Total Borrowings 5,023 10,192–––––––––––––––––––––––––


Maturity analysis


2012 2011w’000 w’000

A. Long-Term LoansPayments analysed as:a. within 1 year 890 1,396b. between 2-5 years 4,133 3,224c. More than 5 years – –

–––––––––––––––––––––––––Total 5,023 4,620–––––––––––––––––––––––––B. Finance Lease LiabilitiesPayments analysed as:a. within 1 year – 188b. between 2-5 years – 467c. More than 5 years – 1,042

–––––––––––––––––––––––––Total – 1,697–––––––––––––––––––––––––

Company


2012 2011w’000 w’000

Non-Current LiabilitiesUnsecured loan notes 3,921 –

–––––––––––––––––––––––––

Total Non-Current Borrowings 3,921 ––––––––––––––––––––––––––Unsecured loan notes

On 25 June 2012, the Company created up to a maximum nominal amount of £5,000,000 (issued in up to100 integral multiples of £50,000 per note) unsecured loan notes due for repayment on the fifth anniversaryof the date of issue. The Company subsequently issued notes totaling £3,200,000 (equating to €3,921,000)to private investors. The notes are unsecured, not convertible into ordinary shares or any other securitiesand will not be admitted to listing on any investment exchange. At any time on or after the first anniversaryand prior to the repayment date the Company may issue written notice to repay all or any notes withoutpenalty provided that each note shall be repaid by the Company at a price of £50,500 (approximately €62,000)per note. At any time during the period of 10 business days following each of the first anniversary and thethird anniversary the noteholder may give the Company written notice requiring the Company to repay all ofthe notes held at their nominal value of £50,000 per note together with accrued interest. Interest on theprincipal amount of the notes accrues at the rate of 10% per annum. The loan was used as a financing toolfor the Group’s investments.

Bank loans

New credit lines for working capital requirements have been received from the Group’s banks during 2012and, together with the above mentioned unsecured loan notes, new loans totaled €6.79 million (2011 – €4.98million). The Group has repaid loans of €2.97 million during the year ended 31 December 2012 (2011 – €9.78million). In addition, bank borrowings amounting to €3.3 million from current liabilities and €3.99 million from


non-current liabilities were disposed of through the sale of subsidiary undertaking Globo Technologies S.A.

The average yearly interest rate for the Group’s borrowings was 8.43% during the year ended 31 December2012.

Security

All facilities from banks and local financial institutions are secured with various customer invoices and postdated cheques. The Group is charged interest until the invoices or post dated cheques are settled by thecustomers. In addition, the Group has also secured major customer contracts in exchange for 60-70% of thecontract value.

For all loans obtained from the above agreements, the Group retains all credit risk associated with the pledgedreceivables until they are fully recovered.

Mr Costis Papadimitrakopoulos has personally co-guaranteed the banks’ credit facilities of the Group.

32. Provisions and Retirement Benefit Obligations

The subsidiaries are required, under Greek Law, to make a payment to employees upon unfair dismissal orupon attaining normal retirement age. The amount payable depends on the employees’ monthly earningsand a multiple which depends on the length of service.

The payment on unfair dismissal or upon attaining normal retirement age is based on the following table:

Employment time Retirement benefit in monthly wages

From 1 year up to 4 years 2

From 4 years up to 6 years 3From 6 years up to 8 years 4From 8 years up to 10 years 5From 10 years onwards (number of years: minus 4)

up to top limit of 12 monthly wages

In order to define the Group’s retirement benefit obligation to its employees an actuarial study was carriedout for the year 2012 and the following assumptions were used to perform the calculations:

(a) Mortality based upon the Greek actuarial company (E.A.E) figures as at 1990.

(b) Interest cost was set at 4%.

(c) Current service cost based on standard wages.

(d) Age of retirement as set by the Social Security Insurance Institution (IKA).

(e) No unfair dismissal before retirement would occur.

(f) Yearly increases in wages of 2.0%.

The latest actuarial study is dated 21 January 2013.


Group

The amounts recognised in the Balance Sheet are determined as follows:


2012 2011w’000 w’000

Retirement Benefit Obligations 113 278

ProvisionsProvisions for tax obligations 13 59

––––––––––––––––––––––––––

Total 126 337––––––––––––––––––––––––––Movements in provisions are as follows:

w’000

As at 1 January 2011 276Additional provision in relation to retirement benefit obligations 80Amount used in the year in relation to retirement benefit obligations (14)Amount used in the year in relation to provisions for tax obligations (5)

––––––––––

As at 31 December 2011 337––––––––––As at 1 January 2012 337Additional provision in relation to retirement benefit obligations 113Disposal of Globo Technologies S.A. (278)Additional provision in relation to tax obligations 13Amount used in the year in relation to provisions for tax obligations (59)

––––––––––

As at 31 December 2012 126––––––––––33. Trade and other payables

Group


2012 2011w’000 w’000

Trade payables 3,675 3,216Post-dated cheques 497 7,107Advance payment from customers 912 393

––––––––––––––––––––––––––

5,084 10,716––––––––––––––––––––––––––


Company


2012 2011w’000 w’000

Trade payables 159 55––––––––––––––––––––––––––

159 55––––––––––––––––––––––––––The Group’s trade and other payables are carried at amortised cost are denominated in the followingcurrencies:


2012 2011w’000 w’000

GBP 214 56EUR 4,782 10,658USD 72 –Other currencies 16 2

––––––––––––––––––––––––––

5,084 10,716––––––––––––––––––––––––––34. Other Taxes

Group


2012 2011w’000 w’000

VAT payable 278 2Personnel tax 194 138Third parties taxes 33 56Prior years’ tax payable 10 73Other taxes payable – 74

––––––––––––––––––––––––––

Current Liabilities 515 343––––––––––––––––––––––––––Prior years’ tax payable – 7

––––––––––––––––––––––––––

Non-Current Liabilities – 7––––––––––––––––––––––––––


Company


2012 2011w’000 w’000

Social security and other taxes 116 92––––––––––––––––––––––––––

Current Liabilities 116 92––––––––––––––––––––––––––Social security and other taxes – 7

––––––––––––––––––––––––––

Non-Current Liabilities – 7––––––––––––––––––––––––––35. Accrued Liabilities and Deferred Income

Group


2012 2011w’000 w’000

Other payables – acquisition of Globo Mobile Inc. 277 –Social security 119 337Deferred income 1,208 54Other payables and accrued expenses 406 2,511

––––––––––––––––––––––––––

2,010 2,902––––––––––––––––––––––––––Company


2012 2011w’000 w’000

Other payables – acquisition of Globo Mobile Inc. 277 –Other payables 70 –Accrued expenses 100 121

––––––––––––––––––––––––––

447 121––––––––––––––––––––––––––


36. Other Non-Current Financial Liabilities

Group and Company


2012 2011w’000 w’000

Contingent consideration (note 20) 227 –––––––––––––––––––––––––––

227 –––––––––––––––––––––––––––As part of the purchase agreement between Globo US Holdings LLC and the previous owners of Globo MobileInc. (formerly Dialect Technologies Inc.), a contingent consideration has been agreed. The terms of the earnout consideration under that agreement are such that if, in any of the eight successive calendar quarterscommencing on 1 April 2012 and ending on 31 March 2014, the Wholesale VoIP Business Revenue exceedsUS$500,000 and achieves a 4% gross profit margin, then the former owners are entitled to receiveUS$300,000.

The fair value of the contingent consideration at the acquisition date and at 31 December 2012 was €386,000and €227,000 respectively.

37. Related Party Transactions

For the purposes of these Financial Statements, parties are considered to be related if one party has theability to control the other party or exercise significant influence over the other party in making financial oroperational decisions as defined by IAS 24 “Related Party Disclosures”. In considering each possible relatedparty relationship, attention is directed to the substance of the relationship, not merely the legal form.

Transactions between the Company and its related parties are disclosed below:

i. Directors’ Remuneration and Service Fees

In the year ended 31 December 2012 the total remuneration and service fees of the Directors was €814,363(year ended 31 December 2011 – €540,615). The amount due to Directors and their service companies asat 31 December 2012 was €54,226 (2011: €41,160).

ii. Managers’ Remuneration

In the year ended 31 December 2012 the total remuneration of the key management personnel was €738,180(year ended 31 December 2011 – €677,150).

The Group is not committed to any post-employment benefits, other long-term benefits or terminationbenefits, other than under Greek Law, for any of its Directors, managers or employees.

iii. Guarantees Received

Mr Costis Papadimitrakopoulos has personally co-guaranteed all banks’ credit lines of the Group.


iv. Transactions with Related Companies

a. Globo Technologies S.A.

Globo Plc charged Globo Technologies S.A. €25,000 during the year for support services (2011 – €40,000).The year-end balance due to Globo Plc and arising from loans to Globo Technologies S.A. was as follows:

At At31 December 31 December

2012 2011w w

Globo Technologies S.A. 1,491,147 19,742,773

b. Globo Plc

The year end balances due to Globo Plc and arising from loans to related parties were as follows:


2012 2011w w

Globo Mobile S.A. 5,970,817 784,805Profitel Communications S.A. 2,692,298 –Globo Services (CY) Limited 4,264,671 2,075,916Globo Mobile Technologies International FZ LLC 1,040,886 –Globo International LLC 620,336 12,513Globo Holdings Limited 200,883 1,581G.M.I.P. Limited 11,864,842 263Globo EMEA Holdings Limited 6,054 263Globo Mobile Inc. 1,059,514 –

The year end balances due from Globo Plc and arising from loans from related parties were as follows:


2012 2011w w

Globo Mobile S.A. – 7,596Globo Services (CY) Limited – 6,182

Controlling Party

The Company does not have any ultimate controlling party.



38. Cash Generated from Operations

Group

Year ended Year ended31 December 31 December

Note 2012 2011w’000 w’000

Profit for the period before tax, includingdiscontinued operations 17,889 12,054Adjustments for:Profit on disposal of tangible/intangible assets – (425)Depreciation of property, plant and equipment 16 925 1,003Amortisation of intangible assets 17 7,801 6,471Movement in provisions 114 61Share-based payments – 256Share of loss of associate 297 –Foreign exchange gain on operating activities 462 545Finance costs (net) 11 855 1,114Adjustments for changes in working capital(Increase)/Decrease in inventory and work in progress (3,084) 595Increase in trade and other receivables (current) (26,195) (3,844)Increase in current assets and other receivables (3,569) (7,320)Increase/(Decrease) in trade and other payables 18,748 (4,030)

––––––––––––––––––––––––––––––––––––––––––––

Cash Generated from Operations 14,243 6,480––––––––––––––––––––––––––––––––––––––––––––Company

Year ended Year ended31 December 31 December

2012 2011w’000 w’000

Operating loss (1,374) (554)Adjustments for:Foreign exchange on operating activities (97) 441Finance income / finance expense (net) 183 (21)Non-cash movement in investments (100) –Adjustments for changes in working capitalIncrease in non-current assets and other receivables (5) –Increase in trade and other receivables (5,969) (19,024)Increase/(decrease) in trade and other payables 161 (76)

––––––––––––––––––––––––––––

Cash used in Operations (7,201) (19,234)––––––––––––––––––––––––––––

Financial statements 115

39. Commitments and Contingencies

i) Operating Lease Commitments

The future aggregate minimum lease payments under non-cancellable operating leases are as follows:


2012 2011w’000 w’000

Within one year 509 111Between 2 and 5 years 1,542 153

––––––––––––––––––––––––––––

2,051 264––––––––––––––––––––––––––––ii) Unaudited Tax Years

The Group has not had its Greek tax computations assessed by the taxation authorities for the financial year2010. Under the revised Greek tax law, the tax audit for 2011 has been conducted by the Greek statutoryauditors. The tax audit for the year 2012 is currently on-going and scheduled for completion in the first halfof 2013.

iii) Guarantees & Liens

At 31 December 2012, the Group had pledged €nil (2011 - €2,599,532) of post-dated cheques as securityagainst short and long term borrowings to several Greek Banks.

Additionally, the Group has assigned its claims against public and private clients’ contracts to a total value of€824,000 at 31 December 2012 for security against short and long term borrowings to a Greek bank(2011 – €5,977,823).

40. Post Balance Sheet Events

In February 2013 the Group signed a distribution agreement with Ingram Micro Inc. (NYSE: IM). Under theterms of the agreement, the Ingram Micro Mobility division will provide Globo’s enterprise mobility solutionsfor the Enterprise and Small and Medium Business (SMB) market to authorised resellers in the United Statesand Canada.

41. Capital Management Policies

The primary objective of the Group’s capital management is to ensure that it maintains a strong credit ratingwith its banks and suppliers in order to support the expansion of the business and maximise shareholdervalue. The Group manages its capital structure according to economic conditions and makes adjustments toit in light of changes to those conditions. Furthermore the Group is continuously reviewing its working andinvestment capital needs in order to secure cash flows and financing facilities to support them. The Group isusing short term debt, long term debt and equity to finance its product development and infrastructure needs.In situations where new capital requirements are imposed by new projects that the Group is aiming to engage,careful planning is undertaken to ensure optimum spending within the project’s resources and within existingand/or new financing facilities.

42. Parent Company statement of comprehensive income

The Company has taken advantage of section 408 of the Companies Act 2006 and has not included its ownstatement of comprehensive income in these Financial Statements. The loss of the Company for the yearwas €1,364,397 (2011 – loss €553,910) which is dealt with in the Financial Statements of the Company.

Notice is given that the Annual General Meeting of Globo plc will be held at 11.00 a.m. on Monday 10 June2013 at 60 Cannon Street, London, EC4N 6NP to consider the following resolutions of which resolutions 1 to5 will be proposed as ordinary resolutions and resolutions 6 and 7 as special resolutions.

1. To receive the annual report and audited accounts for the year ended 31 December 2012.

2. To re-elect Mr G Bonanos as a director.

3. To re-elect Mr G Burnell as a director.

4. To reappoint Littlejohn LLP as auditors of the Company to hold office until the conclusion of the nextgeneral meeting at which accounts are laid before the members and to authorise the directors todetermine their remuneration.

5. THAT in substitution for any existing such authority, the directors be and are hereby generally andunconditionally authorised under section 551 of the Companies Act 2006 (the Act) to allot relevantsecurities of the Company (within the meaning of that section) up to an aggregate nominal amount of£1,132,694 such authority (unless previously revoked or varied) to expire at the end of next year’s AGMor, if earlier, 30 June 2014 save that the Company may before such expiry make an offer or agreementwhich would or might require relevant securities to be allotted after such expiry and the directors mayallot relevant securities under such an offer or agreement as if the authority conferred hereby had notexpired.

Special Resolutions

6. THAT, subject to the passing of resolution 5 above, the directors be and are hereby empowered undersection 570 of the Companies Act 2006 (the Act) to allot equity securities (within the meaning of section560 of the Act) under the authority conferred by resolution 5 above as if section 561(1) of the Act didnot apply to any such allotments provided that this power shall be limited to:

(a) the grant of options under the Globo Share Option Plan (Parts I and II) (the “Plan”), to employees,directors, management and consultants of the Company and its subsidiaries from time to time(the “Group”), and the issue of ordinary shares upon the exercise of such options, provided thatthe number of ordinary shares in respect of which such options may be granted under the Planshall not, when added to the number of ordinary shares issued or capable of being issued by wayof subscription on the exercise of options granted by the Company in any ten year period under:

(i) the Plan; or

(ii) any other share plan approved by the Company in general meeting or adopted by the boardof directors of the Company after the adoption of the Plan which provides for the acquisitionof shares by or on behalf of employees, directors, contractors or consultants of the Group(but excluding any options which have lapsed or been surrendered and options grantedbefore the adoption of the Plan)

exceed 5 per cent. of the ordinary shares in issue from time to time;

(b) the allotment of equity securities in connection with an invitation or offer of equity securities tothe holders of ordinary shares in the capital of the Company (excluding any shares held by theCompany as treasury shares (as defined in section 724(5) of the Act)) on a fixed record date inproportion (as nearly as may be) to their respective holdings of such shares or in accordance withthe rights attached to such shares (but subject to such exclusions or other arrangements as thedirectors may deem necessary or expedient in relation to fractional entitlements or as a result oflegal or practical problems under the laws of, or the requirements of any regulatory body or anystock exchange in any territory or otherwise howsoever);

Notice of Annual General Meeting

(c) the allotment (other than under paragraphs (a) and (b) above) of additional equity securitiesand/or the sale or transfer of shares held by the Company in treasury (as the directors shall deemappropriate) up to an aggregate nominal value of £339,808;

and so that such power (unless previously revoked or varied) shall expire at the end of next year’sannual general meeting, (or if earlier 30 June 2014) provided that the directors may, before the powerexpires, make an offer or enter into an agreement which would or might require equity securities to beallotted after such power expires.

7. THAT, the Company be generally and unconditionally authorised to make market purchases (as definedin the Companies Act 2006) of ordinary shares of 1p each in the capital of the Company (“ordinaryshares”) on such terms and in such manner as the directors may from time to time determine, providedthat:

(a) the maximum number of ordinary shares authorised to be purchased shall be 50,971,239;

(b) the minimum price which may be paid for an ordinary share is 1p;

(c) the maximum price which may be paid for an ordinary share is an amount equal to 105 per cent.of the average of the middle market quotations for an ordinary share (as derived from the DailyOfficial List) for the five business days immediately preceding the date on which the ordinaryshare is contracted to be purchased;

(d) the minimum and maximum prices per ordinary share referred to in sub-paragraphs (b) and (c)of this resolution are in each case exclusive of any expenses payable by the Company;

(e) the authority conferred by this resolution shall expire at the end of next year’s annual generalmeeting (or if earlier 30 June 2014) unless such authority is varied, revoked or renewed prior tosuch time by the Company in general meeting by special resolution; and

(f) the Company may make a contract to purchase ordinary shares under the authority herebyconferred prior to the expiry of such authority which will or may be completed wholly or partlyafter the expiration of such authority.

By order of the Board

Lorraine YoungSecretary

Registered Office:190 High StreetTonbridgeKent TN9 1BE

17 May 2013


Right to attend, speak and vote

1. If you want to attend, speak and vote at the AGM you must be on the Company’s register of membersat 11.00 a.m. on 6 June 2013. This will allow us to confirm how many votes you have on a poll. Changesto the entries in the register of members after that time, or, if the AGM is adjourned, 48 hours beforethe time of any adjourned meeting, shall be disregarded in determining the rights of any person toattend, speak or vote at the AGM.

Appointment of proxies

2. As a member of the Company, you are entitled to appoint a proxy to exercise all or any of your rightsto attend, speak and vote at the meeting and you should have received a proxy form with this noticeof meeting. You can only appoint a proxy using the procedures set out in these notes and the notes tothe proxy form.

3. A proxy does not need to be a member of the Company but must attend the meeting to represent you.Details of how to appoint the Chairman of the meeting or another person as your proxy using the proxyform are set out in the notes to the proxy form. If you wish your proxy to speak on your behalf at themeeting you will need to appoint your own choice of proxy (not the Chairman) and give your instructionsdirectly to them.

4. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached todifferent shares. You may not appoint more than one proxy to exercise rights attached to a single share.To appoint more than one proxy, please contact the registrars of the Company, Share Registrars Limitedon 01252 821390.

5. If you do not give your proxy an indication of how to vote on any resolution, they will vote or abstainfrom voting at their discretion. Your proxy will vote (or abstain from voting) as they think fit on anyother matter which is put before the meeting. A vote withheld is not a vote in law, which means thatthe vote will not be counted in the calculation of votes for or against the resolution.

6. The notes to the proxy form explain how to direct your proxy how to vote on each resolution or withholdtheir vote.

7. To appoint a proxy using the proxy form, the form must be completed and signed. It must then be sentor delivered to the Company’s registrars, Share Registrars Limited, Suite E, 1st floor, 9 Lion and LambYard, Farnham, Surrey GU9 7LL. Alternatively it can be sent by fax to 01252 719232; or scanned andsent by email to [email protected]. The proxy form must be received by Share RegistrarsLimited no later than 11.00 a.m. on Thursday 6 June 2013.

8. In the case of a member which is a company, the proxy form must be executed under its common sealor signed on its behalf by an officer of the company or an attorney for the company. Any power ofattorney or other authority under which the proxy form is signed (or a duly certified copy of such poweror authority) must be submitted with the proxy form.

Appointment of proxy by joint members

9. In the case of joint shareholders, where more than one of them purports to appoint a proxy, only theappointment submitted by the most senior holder will be accepted. Seniority is determined by the orderin which the names of the joint holders appear in the Company's register of members in respect of thejoint holding (the first-named being the most senior).

Changing proxy instructions

10. To change your proxy instructions simply submit a new proxy appointment using the methods set outabove. Note that the cut-off time for receipt of proxy appointments (see above) also applies in relationto amended instructions; any amended proxy appointment received after the relevant cut-off time will

Notes

be disregarded. Where you have appointed a proxy using a hard-copy proxy form and would like tochange the instructions using another hard-copy proxy form, please contact Share Registrars Limitedon 01252 821390.

If you submit more than one valid proxy appointment, the one received last before the latest time forthe receipt of proxies will have effect.

Termination of proxy appointments

11. In order to revoke a proxy instruction you will need to inform the Company by sending a signed hardcopy notice clearly stating your intention to revoke your proxy appointment, to: Share Registrars Limited,Suite E, 1st floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL or by fax to 01252 719232. In thecase of a member which is a company, the revocation notice must be executed under its common sealor signed on its behalf by an officer of the company or an attorney for the company. Any power ofattorney or any other authority under which the revocation notice is signed (or a duly certified copy ofsuch power or authority) must be submitted with the revocation notice. In either case, the revocationnotice must be received by Share Registrars Limited no later than 11.00 a.m. on Thursday 6 June 2013.

If you attempt to revoke your proxy appointment but the revocation is received after the time specifiedthen, subject to the paragraph directly below, your proxy appointment will remain valid.

Appointment of a proxy does not prevent you from attending the meeting and voting in person. If youhave appointed a proxy and attend the meeting in person, your proxy appointment will automaticallybe terminated.

Communication

12. Except as provided above, members who have general queries about the meeting should contact ShareRegistrars Limited on 01252 821390 or by email to [email protected] (no other methodsof communication will be accepted).

You may not use any electronic address provided either:

• in this notice of annual general meeting; or

• any related documents (including the proxy form),

to communicate with the Company for any purposes other than those expressly stated.

Issued shares and total voting rights

13. As at 5.00 p.m. on the day immediately prior to the date of posting of this notice of meeting, theCompany’s issued share capital comprised 339,808,261 ordinary shares of 1p each. Each ordinary sharecarries the right to one vote at a general meeting of the Company and, therefore, the total number ofvoting rights in the Company at that time was 339,808,261.


This year’s annual general meeting will be held at 11.00 a.m. on Monday 10 June 2013 at 60 Cannon Street,London EC4N 6NP. The notice of meeting is set out on pages 116 and 117 of this document and a form ofproxy is enclosed.

Details of resolutions to be considered at the meeting are given below.

Accounts (resolution 1)

In accordance with usual practice, shareholders are asked to receive the report and accounts for the yearended 31 December 2012.

Directors (resolutions 2 and 3)

Under the Company’s articles of association, Makis Bonanos and Gavin Burnell are due to retire by rotationand they each offer themselves for re-election by shareholders. Biographical details of all of the directors aregiven on pages 26 and 27 of this document.

Auditors (resolution 4)

Littlejohn LLP have expressed their willingness to continue in office as auditor and this is the resolution toreappoint them.

Authority to allot shares (resolutions 5 and 6)

In accordance with current guidelines, the Directors seek authority to allot up to a maximum of 113,269,400relevant securities. This represents approximately 33 per cent. of the issued ordinary share capital as at 10May 2013. Further, in order to retain some flexibility, the Directors seek power to allot 33,980,800 equitysecurities wholly for cash other than on a pre-emptive basis to current shareholders pro-rata to their existingholdings. This amount represents 10 per cent. of the issued ordinary share capital as at 10 May 2013. Theseauthorities will continue in force until the AGM to be held in 2014 or 30 June 2014, whichever is the earlier.

Authority for the Company to purchase its own shares (resolution 7)

Resolution 7 authorises the Company, until the earlier of next year’s AGM or 30 June 2014, to purchase inthe market up to a maximum of 50,971,239 ordinary shares (equivalent to approximately 15 per cent. of theissued share capital of the Company as at 10 May 2013) for cancellation at a minimum price of 1p per shareand a maximum price per share of an amount equal to 105 per cent. of the average of the middle marketquotations for an ordinary share (as derived from the Daily Official List) for the five business days immediatelybefore the date of purchase.

The Companies Act 2006 allows the Company to hold any repurchased shares in treasury, instead of cancellingthem immediately. If the Company buys back its own shares and holds them in treasury it may then dealwith some or all of them in several ways. It may sell them for cash; transfer them under the provisions of anemployee share scheme; cancel them; or continue to hold them in treasury. Holding shares in treasury inthis way would allow the Company to reissue them quickly and cost effectively, giving increased flexibility tothe management of its capital base. Dividends are not paid on shares held in treasury, nor do they carryvoting rights while they remain there. The Directors intend to decide at the time of any share buyback,whether to cancel the shares immediately or to hold them in treasury, depending on the interests of theCompany and its shareholders as a whole, at the time. The Company does not currently hold any shares intreasury. This proposal should not be taken as an indication that the Company will purchase shares at anyparticular price or indeed at all, and the Directors will only consider making purchases if they believe thatsuch purchases would result in an increase in earnings per share and are in the best interests of shareholders.

It is intended to renew each of the above authorities at each annual general meeting.

Annual General Meeting – Explanation of Business


Proxy Form

I/We......................................................................................................................................................(insert full name in BLOCK CAPITALS)

of ..........................................................................................................................................................(insert address in BLOCK CAPITALS)

being (a) member(s) of GLOBO PLC (the ‘Company’) hereby appoint the Chairman of the meeting or thefollowing person:

as my/our proxy to attend and vote for me/us and on my/our behalf at the Annual General Meeting of theCompany to be held at 60 Cannon Street, London EC4N 6NP on Monday 10 June 2013 at 11.00 a.m. and atany adjournment of that meeting. I/We request such proxy to vote on the following resolutions as indicatedbelow:

RESOLUTIONS For Against Withheld

1. To receive the report and accounts for the yearended December 2012

2. To re-elect Mr G Bonanos as a director

3. To re-elect Mr G Burnell as a director

4. To reappoint the auditors and authorise the directorsto determine their remuneration

5. To authorise the directors to allot relevant securities

6. To disapply pre-emption rights

7. To authorise the company to buy back its shares

Please tick here if the proxy appointment is one of multiple appointments being made and state inthe box the number of shares to which this proxy relates. Also, see note 7 below

Signature ............................................................................. Date ........................................................

Name Number of shares*

✃

NOTES:

1. A proxy need not be a member of the company.

2. Please indicate with an ‘X’ in the appropriate boxes above how you wish your votes to be cast. Unless otherwiseinstructed the proxy may vote or abstain from voting as they think fit. The ‘vote withheld’ option is provided so thatyou may abstain on any particular resolution: this is not a vote in law and will not be counted in the calculation of theproportion of votes ‘for’ and ‘against’ a resolution.

3. To be effective this proxy form must be deposited with Share Registrars, Suite E, First Floor, 9 Lion and Lamb Yard,Farnham, Surrey, GU9 7LL, not less than 48 hours before the time fixed for the meeting (excluding non-working days).The proxy form must be signed by the member or the member’s attorney duly authorised in writing or, if the memberis a corporation, it must be either under its common seal or signed on its behalf by an attorney or officer duly authorisedwhose capacity should be stated.

4. In the case of joint members the vote of the senior joint member who signs a proxy form will be accepted to theexclusion of others, seniority being determined by the order of names in the register.

5. If you wish to appoint someone other than the Chairman as your proxy, delete “the Chairman of the meeting (or)”and insert the name of your proxy in the box provided.

6. If the proxy is being appointed in relation to only some of your shares, please write the number of shares in respectof which they are authorised to act in the box next to their name. If this box is left blank, your proxy will be deemedto be authorised to act in respect of all of your shares.

7. To appoint additional proxies, this form may be photocopied or additional copies obtained from the registrars. On eachform, please indicate in the box next to the proxy holder’s name the number of shares in relation to which they areauthorised to act and ensure that each form bears an original signature. If you wish to terminate the proxy appointmentyou will need to inform the Company by sending a signed hard copy notice clearly stating your intention to revokeyour proxy appointment. Your revocation notice must be received no later than 48 hours before the meeting (excludingnon-working days).

8. Completion and return of a proxy form will not prevent you from attending and voting in person at the meeting shouldyou subsequently decide to do so.

9. Any alteration made to this proxy form should be initialled.

10. As at 5.00 p.m. on the day immediately prior to the date of posting of this notice of meeting, the Company’s issuedshare capital comprised 339,808,261 ordinary shares of 1p each. Each ordinary share carries the right to one vote ata general meeting of the Company and, therefore, the total number of voting rights in the Company at that time was339,808,261.

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