company presentation · cyan has a broad blue -chip client portfolio and has won significant...

© cyan Digital Security 2020

cyan is a leading European cybersecurity provider that caters to Mobile Network Operators and Internet Service Providers (MNOs & ISPs), Mobile Virtual Network Operators (MVNOs), insurers and banks

cyan offers its seamless, holistic cybersecurity solutions via a white-label B2B2C approach to its clients’ large end-customer base, allowing them to generate additional revenues and differentiate themselves from their competition

cyan is the only cybersecurity provider servicing mobile endpoints with net-integrated solutions supplemented with a broad range of features for endpoint as well as fixed line and IoT protection

cyan has a broad blue-chip client portfolio and has won significant contracts with MNOs such as Orange or Deutsche Telecom and financial services companies such as Aon, which will support significant growth in the near-to-mid-term

In FY2019, cyan reached €33m in total revenues and €12m in EBITDA

2

© cyan Digital Security 2020 3

CEO CTO CFO

CFO of cyan AG

Partner and CFO, Petrus Advisers(2010 - 2017)

Member of the Board, Wiener Privatbank SE (2013 - 2014)

Managing Director, Deutsche Bank AG(1997 - 2009)

CTO of cyan AG

CEO of I-New Mobile Solutions AG(2019 - today)

CTO of cyan Security Group (2011 - today)

Founder and CTO of cyan Networks(2006 - today)

CEO of cyan AG

CEO of cyan Security Group(2011 - today)

Member of the Board E-Plus Mobilfunk(2006 - 2007)

Member of the Board T-Mobile Austria (1998 - 2006)


5.2bn people worldwide already use a mobile phoneHalf of world’s internet connections via smartphones5.2bn people worldwide already use a mobile phoneHalf of world’s internet connections via smartphones

The use of SIM cards worldwide will expand to 9.2bn (34.4bn incl. IoT) by 2025The use of SIM cards worldwide will expand to 9.2bn (34.4bn incl. IoT) by 2025

Number of unique mobile subscribers expected 5.9bn in 2025Number of unique mobile subscribers expected 5.9bn in 2025

36%

44%49%

2016A 2018A 2020E

40%46%

51%

2016A 2018A 2020E

23%27%

33%

2016A 2018A 2020E

Using online payment systems

Online shopping

Online banking

Growing awareness and demand for cybersecurity

Growing smartphone penetration globally (e.g. 90% for US in ‘25)

Mobile end-user activity (%)

Source: GSMA Intelligence, GlobalData

5© cyan Digital Security 2020

0

20

40

60

80

100

120

2016 2017 2018

in m detections1)

(1) Global detections of malware such as backdoors, crypto-mining, fake apps, banking trojans etc.


9.6

5.2

2.6

4.4

1.3

1.3

Total SIM cards Machine2Machine, IoT Unique global subscribers Unlikely customers Total addressable market

Source: GSMA Intelligence, GlobalDataNote: for simplicity reasons, the breakdown focuses on cybersecurity for mobile phones only – IoT (usually only protectable with the OnNet approach) will become a big topic in the mid-term future(1) Accounts for feature phones and very low-income countries as well as for customers in unlikely markets with different security standards such as China or Russia (both roughly 1.3bn)

1)

MNO on-net72%

Endpoint protection

28%


0.9

1.6 +83%

Source: Globally leading market and strategy consultancy(1) For smartphones only;(2) For smartphones and PCs (cannot be separated logically)

0.5

4.1

+639%

€bn

€5.7bn

Significant additional growth potential in the endpoint market from selling endpoint protection

on top of OnNet security solution (bundling)USP: seamless security by cyan

€bn


Easy to roll-out Suitable for mass market Resource effective solution Future (5G ready) proven DoH/DoT ready Device and OS independent

Machine & capex intensive DPI compromises user experience More and more encrypted data limit reliability

(https) 5G will lead to heavy capacity problems

Device and OS dependent Requires installation, configuration & frequent

updates Typically low penetration MNO loses cyber customer to third partyNote: DoT: DNS-over-TLS; DoH: DNS-over-HTTPS; DNS: Domain Name System; DPI: Deep Package Inspection

(1) Integrated not on a stand-alone basis, only due to collaboration with an endpoint partner

1)

1)

1)


DNS providers

Endpoint providers

/x With 3rd party only /x n/a With 3rd party only

3rd

party3rd

party3rd

party

xDPI

With 3rd party only Partially With 3rd party only With 3rd party only

3rd

party3rd

party3rd

party

OnNet:

Endpoint:xx x x x x

x n/a

DNS vs. DPI Own research/sourcing vs. buying lists only

Integration into client’s marketing vs. own brand strategy

Customer convenience when logging in / signing up

Only provider rendering a complete mobile cybersecurity spectrum SEAMLESS SECURITY

x

3rd

party

3rd

party

x

x


Highly scalable and performance efficient DNS approach

Sourcing via live analysis with ~200 virtual data centers

>1,000bn anonymized data requests monthly

The picture can't be displayed.

Own patented AI algorithms plus human manpower

Cooperation with security partners

#

Update frequency: 2 hours Real-time updates soonEnsuring quality of solution Constantly evolving database to

account for new threats More users generate more data

11

User traffic analysis

• Behavioral analysis of end-customers’ data usage

• Increasing accuracy with a growing number of users

DNS name analysis

• Systematic analysis of domain names• Use of DGAs (domain generation

algorithms) or typo domains

Automated content analysis

• Complex, partially patented methods that simulate human behavior (browser sandbox)

• Use of artificial intelligence and machine learning

Manual content analysis

• Enriches computerized research and improves overall quality

• Also includes automated cross checking to quality check algorithms

Honeypots

• Simulation of a vulnerable platform to attract threats

• Web honeypots (software attacks) or email honeypots (phishing, scamming)

1)

• ( ) End-customers’ metadata and web crawlers, which scan the internet 24/7, provide the basis for cyan’s ongoing categorization with new DNS addresses to be scanned for malicious content

• cyan’s examination then draws on algorithms ( ) and human input ( ) to analyze/ identify new malicious websites

• The Security filter database ( ) contains cyan’s accumulated information on cyberthreats

• The Security filter database is updated 12 times daily at cyan’s customers (e.g. MNOs/ISPs), aiming to offer real-time updating by 2020/21

• The security database is hosted in Austria and supplemented by virtual data centers around the globe

• cyan maintains close cooperation with leading research centers, such as Vienna University of Technology, Secure Business Austria and many more

25 methods of analysis

Security filter database

Human input

End-customer

2

4

3

Anonymous metadata

4

2 3

(1) Combination of AI & manual (expert) input constitutes an important competitive advantage and leads to superior results of the database

Web crawlers, directories,

lists, etc.

1

1



Generate additional revenue by offering cybersecurity as a value-added serviceNo separate mobile app required1)

One-stop solution for MVNOs and smaller MNO B-brands High scalability through cloud based

services

App-based security solution to detect cyberthreats and bad content on deviceTarget industries: Insurers, Fin-

techs, banks, retailers

Lightweight MVNE include billing, network integration, provisioning, touchpoints, etc.Target industries: MVNE platforms,

MVNOs

White-labelled B2B2C modelHigh scalability

Protection against harmful content on the web within the operator’s networkFully network-integrated cybersecurityTarget industries: MNOs/MVNOs/ISPs

MNOs: Lower network load allows to defer scheduled capexMVNOs: Reduction of data purchase

costs creating positive EBITDA effect

Blocking of harmful and illegal content for the whole subscriber base Increased performance, better user

experience (faster loading of pages)Target industries: MNOs/MVNOs

65%25%

10%

(1) Integrated into operator’s app; end-customer has access to cyan’s solutions after updating the operator’s app


More satisfied customers

Minimal integration points

Cover whole end-customer base

EBITDA effect for MVNOs

Better user experience (blocking of

unwanted ads)

Shorter loading times

No app or any other installation

required

Privacy assured

Data traffic optimization for MNO and MVNO

Network-integrated content filter solution

Blocks harmful and illegal content (phishing, malware and trackers)

Reduces the amount of data used

Marketed directly to MNOs/MVNOs and is not visible to end-customer

Not user-specific: all end customers are subject to Clean Pipe DNS

Clean Pipe DNS constitutes an entry product for cyan’s OnNet Security & Endpoint solutions

13


End-customers fully protected when surfing on mobile devices using their MNOs or MVNOs network

After software integration, OnNet Security can be sold to all end-customers

“White-labeled” product (OnNet Security is provided under the client’s look-and-feel)

OnNet Security’s protection is always up-to-date (cyan’s database updated at least six times a day)

Fully network integrated solutionFully network integrated solution

Fully branded in look-and-feel of network operatorFully branded in look-and-feel of network operator

End-customer is redirected to blocking screenEnd-customer is redirected to blocking screen

Push messages, individual warnings and monthly reports on requestsPush messages, individual warnings and monthly reports on requests

Responsive design for every device & OS (incl. Android, iOS, Windows)Responsive design for every device & OS (incl. Android, iOS, Windows)

+(1) Exemplary price charged by MNO to end-customer, cyan is compensated with a revenue share or license fee model


Premium cybersecurity solution typically

Endpoint Protection also protects the end-customer when surfing in Wi-Fi networks

Comes as part of an update of the operator’s existing app (implemented via SDK)

Targets cybersecurity-aware end-customers

Contains anti-virus protection for apps, malware scans, website checking or identity protection features

Fully branded in look-and-feel of clientFully branded in look-and-feel of client

Additional security features compared to OnNet SecurityAdditional security features compared to OnNet Security

+Integration of security module in existing client appIntegration of security module in existing client app

Protection includes Wi-Fi networks as well as mobile networksProtection includes Wi-Fi networks as well as mobile networks

(1) Exemplary price charged by MNO to end-customer which includes OnNet Security and Endpoint features, cyan is compensated with a revenue share or license fee model


Functions such as campaign and sales channel mgmt

Covers product lifecycle mgmt, product performance mgmt, etc.

Customer information mgmt, order mgmt and customer self care

Service performance mgmt and resource activation

Invoicing and receivables management

Asset management and data analytics

Ensures proper functioning and connection of the platform

Front ends

Product management

ESS

CRM

OSSBilling5

EAI

7

1

2

3

4

6

BEST MVNOSOLUTION VENDOR

2014-2015

BEST MVNEENABLER OF MVNOs

2016

Note: BSS = Business Support Systems; OSS = Operations Support Systems; CRM = Customer Relationship Management; EAI = Enterprise Application Integration; ESS = Enterprise Service Systems

1

2

3

4

5

6

7

© cyan Digital Security 2020 17(1) Compared to last update of sales pipeline (2H19); valid for all figures presented in brackets

NDA; 8 (3)

PoC; 3(2)

RfP / RfQ; 18 (4)

Close to signing; 4 (2)1)

MNO leads: 33

NDA; 4 (4)

PoC; 6(3)

RfP / RfQ; 10(2)1)

Close to signing; 3 (2)

Endpointleads: 23

NDA; 1 (3)1)

RfP / RfQ; 11 (1)

Close to signing; 3 (1)

BSS/OSS leads: 15

Orange France gets network security & endpoint B2B

Orange Europe gets Orange protect and Orange protect+ for B2C

Orange Group roll-out in Europe

Orange France roll-out of B2C products

Launch of additional Orange countries

OnNet Security protection for IoT devices

Endpoint Protection for IoT

MVP 1 MVP 2 MVNOIoT

OnNet Security protection for MVNOs within the Orange network

Significant increase of addressable user base


19© cyan Digital Security 2020

Total number ofshares outstanding:

9,774,538

Alexander Schütz14.7%

Apeiron Ltd12.6%

Tansanit Stiftung10.3%

Infinitum3.9%

Free float50.4%

Management8.1%

Group total revenues of EUR 4.0m1) for and EBITDA of EUR -1.7m

Segment revenues Q1 2020:

– BSS/OSS EUR 1.7m; EBITDA margin: -35%

– Cybersecurity EUR 0.8m; EBITDA margin -125%

Successful integration at Orange France, launch expected in 2H20 –roll-out in other Orange countries being prepared

Launch of Aon app in Apr-20; being rolled out to EMEA region

Signing of significant contracts such as

– MobiFone (third largest Vietnamese MNO with +30m end customers)

– Vara Technologies (Indian tech-integrator)

– Fibank (one of the largest Bulgarian banks)

(1) Sales revenue EUR 2.4m+other earnings EUR 0.4m+changes in (un)finished goods and WIP EUR 1.1m; (2) EBIT(DA) divided by revenue; (3) deductions from gross cash result from IFRS financial leasing liabilities resulting from e.g. long-term office rents © cyan Digital Security 2020

Total revenues

EBITDA

EBITDA-Margin2)

EBIT

EBIT-Margin2)

Net income/loss

Earnings per share

Revenue BSS/OSS

Revenue Cybersecurity

EBITDA BSS/OSS

EBITDA Cybersecurity

Operating cash flow

Investment cash flow

Financing cash flow

Assets total

Equity

Net debt3)

32.5

11.7

44%

5.5

21%

4.5

0.49

18.4

8.3

11.5

3.7

- 5.8

0.5

11.8

99,3

82.2

- 5.1

20.7

3.0

34%

- 0.9

- 11%

- 0.6

- 0.07

5.0

3.9

5.9

- 0-1

- 4.1

- 17.5

20.0

83.3

50.4

11.5

20

4.0

- 1.7

-71%

- 3.1

- 128%

- 2.2

- 0.23

1.7

0.8

- 0.6

- 0.9

- 2.2

- 0.5

- 0.2

98.4

80.2

- 0.9


In a first step, cyan supplies its child protection technology

Further expects to implement its full cyber product spectrum with OnNet and endpoint security

cyan successfully won an international tender in Dec-2018

The cyber filter was integrated in 2019 into the French mobile networks

Product start (Child Protection and B2B) expected in 2H 2020; B2C subsequently

cyan created a fully customized app offering a preventive, digital security with the introduction of Aon's CySec App

The app is globally available since April 2020

Aon will market the app with ca. 14m end-customers in Europe

is one of the main network operators in Vietnam with a fast growing customer base of over 30m customers

is the world’s largest insurance broker employing more than 50,000 people

Orange is one of the world's leading telcos with over 260m customers and strong market positions in Europe and Africa

This presentation (the “Presentation”) has been produced for discussion purposes only. The Presentation is not a securities prospectus and the information contained therein does not constitute or form apart of any offer or solicitation to purchase or subscribe for securities in the United States, Australia, Canada, or Japan or in any other jurisdiction in which such offer or sale would be unlawful. Thesecurities referred to in the presentation have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended, or under any applicable securities laws of any state, province, territory,county or jurisdiction of the United States, Australia, Canada, or Japan. Accordingly, unless an exemption under relevant securities laws is applicable, any such securities may not be offered, sold, exercised,transferred, delivered or distributed, directly or indirectly, in or into the United States, Australia, Canada, or Japan or any other jurisdiction if to do so would constitute a violation of the relevant laws of, orrequire registration of such securities in, the relevant jurisdiction.The information contained in this presentation does not constitute investment advice.The Presentation is being made only to, and is only directed at, persons to whom it may lawfully be communicated (“relevant persons”). Any person who is not a relevant person should not act or rely on thispresentation or any of its contents. This presentation does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any shares or other securities in cyan AG(the "Company"), nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment or investment decisions relating thereto, nor doesit constitute a recommendation regarding the shares and other securities of the Company.The information herein pertaining to the company and its investments is fully confidential. Please do not publish or disclose it to any third party other than your attorneys, advisers, and others under bindingconfidentiality obligations without the express prior written consent of cyan. The presentation does not constitute any legal advice. This must be done individually, taking into account the circumstances ofthe individual case. The unaudited historical financial information and numbers of the company contained herein are preliminary and subject to adjustments and modifications.All aspects of the Presentation must be considered in the context of more fulsome and independently-obtained information that may be required for any decision regarding the Presentation’s subjectmatter. Any recipient of the Presentation should determine, in consultation with its own legal, tax, regulatory, accounting and other pertinent advisors, all economic risks and merits, as well as legal, tax,regulator and accounting characteristics and consequences, of any transaction as it pertains to them. Past performance presented in the presentation should not be taken as an indication or guarantee offuture performance, and no representation or warranty, express or implied, is provided in relation to any aspect of the Presentation. The Company accepts no responsibility for, and expressly disclaims allliabilities relating to, any loss, whether direct or indirect, or any other kind of damage resulting from reliance upon or use of information contained in the Presentation.Certain statements included or incorporated by reference within this presentation may constitute “forward-looking statements” in respect of the Company’s operations, performance, prospects and/orfinancial condition. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions and actual results or events may differ materially from those expressed or impliedby those statements. Hence, there is a considerable risk that investors face the risk to lose all their money they invest in the company. Accordingly, no assurance can be given that any particularexpectation will be met and reliance should not be placed on any forward-looking statement. Nothing in this presentation should be construed as a profit forecast. All forward-looking statements relating tothe Presentation are qualified in their entirety by this cautionary statement.The Presentation is to be construed as of the date of its creation and is subject to change at any time without notice. No party makes any representation, whether express or implied, with respect to thecompleteness or accuracy of the Presentation, or for the fitness of the information in the Presentation for any purpose. No party shall have any obligation to update any information contained in thePresentation at any time. Nothing in this Presentation shall be construed by any party as a binding or legally enforceable commitment, contract or offer to contract with respect to its subject matter. ThePresentation neither imposes any obligation, nor grants any rights with respect to, any service or transaction referenced in the Presentation, nor does it impose on any party a duty or obligation to concludeany such agreement or commitment. Any person receiving the Presentation is deemed to have accepted these legal notices and that such notices shall apply even if the Presentation in any way is shown tobe erroneous, incomplete or based upon incorrect or incomplete facts, interpretations or assessments or assumptions, irrespective of any responsibility of the Company. To the extent permitted by law, alllegal considerations arising from this Presentation shall be governed by the Law of Germany.

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