Segments

Operating segments are reported in a manner consistent with the internal reporting, which are provided to the chief operating decision maker. The chief operating decision maker is the Company’s Chief Executive Officer (“CEO”), who is responsible for allocating resources and assessing the performance of the operating segments. Historically, the Company had three operating segments: web data collection (formerly known as enterprise internet access), consumer internet access and enterprise cybersecurity. In July 2023, the Company sold the enterprise cybersecurity segment, and accordingly, it is presented in these consolidated financial statements as “discontinued operations”.

In addition, following the scale down in the operations of the Company’s wholly-owned subsidiary CyberKick Ltd. (“CyberKick”) commencing in the second quarter of 2023, as further described in Note 6, the Company’s CEO is no longer assessing the performance of the consumer internet access segment. Therefore, as of December 31, 2024, the Company concluded it has one operating and reportable segment. Accordingly, the information regarding the Company’s segments for prior periods was retrospectively adjusted in these consolidated financial statements.

Translation of foreign currency balances and transactions

Translation of foreign currency balances and transactions

Functional and presentation currency

Items included in the financial statements of each of the Company’s subsidiaries are measured using the currency of the primary economic environment in which the subsidiary operates (the “Functional Currency”) The consolidated financial statements of the Company are presented in U.S. dollars, which is the Company’s and the Company’s subsidiaries Functional Currency.

Transactions and balances

Transactions made in a currency which is different from the functional currency are translated into the Functional Currency using the exchange rates prevailing at the dates of the transactions or valuations where the items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at the end-of-year exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in profit or loss as finance income (expense).

Debt investments at fair value through other comprehensive income

Debt investments at fair value through other comprehensive income

Debt investments consist of debt marketable securities which the Company classifies as financial assets measured at fair value through other comprehensive income (“OCI”). Financial assets measured at fair value through OCI are financial assets held within a business model whose purpose is both to collect contractual cash flows and to sell the financial assets, where the cash flows of the assets represent solely payments of principal and interest. Financial assets measured at fair value through OCI are initially recognized at fair value plus transaction costs. Gains or losses arising from changes in the fair value of the financial assets are taken through OCI, except for the recognition of impairment gains or losses, interest income using the effective rate method and foreign exchange gains and losses, which are recognized in profit or loss.

When the financial asset is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to profit or loss. Foreign exchange gains and losses, impairment expenses as well as interest income from these financial assets are included in financial income (expense) in the consolidated statements of profit or loss and other comprehensive income (loss).

Goodwill

Goodwill

Goodwill arising from a business combination represents the excess of the overall amount of the consideration transferred, the amount of any non-controlling interests in the acquired company over the net amount as of acquisition date of the identifiable assets acquired and the liabilities assumed. Impairment reviews of the cash-generating-unit (“CGU”) to which goodwill was allocated are undertaken annually and whenever there is any indication of impairment of a CGU.

Goodwill is tested annually for impairment in the fourth quarter of each year, or more frequently if events or changes in circumstances indicate that it may be impaired. For the 2024, 2023 and 2022 reporting periods, the recoverable amount of the Company’s CGUs was determined based on value-in-use calculations. These calculations require the use of assumptions. For further details, see Note 6.

Financial liabilities at amortized cost

Financial liabilities at amortized cost

Financial liabilities at amortized cost are initially recognized at their fair value less transaction costs that are directly attributable to the issue of the financial liability and are subsequently measured at amortized cost. For further information regarding the Company’s accounting policy related to long-term loans, see Note 9.

Income taxes

Income taxes

Tax benefit (expense) for the reported years comprise current and deferred taxes.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the financial position date in the countries where the Company operates and generates taxable income. The Company’s management periodically evaluates the tax aspects applicable to its taxable income based on the relevant tax laws and makes provisions in accordance with the amounts payable to the applicable authorities.

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

Profit (loss) per share

Profit (loss) per share

Basic profit (loss) per share is calculated by dividing net profit (loss) for the year by the weighted average number of ordinary shares, including pre-funded warrants, vested RSUs and vested options with zero-exercise price. When calculating the diluted profit (loss) per share, the Company adjusts the profit (loss) attributable to holders of ordinary shares and the weighted average number of shares in issue, to reflect the effect of all potentially dilutive ordinary shares.

Leases

Leases

The Company’s leases include property and vehicle leases.

At the commencement date, the Company measures the lease liability at the present value of the lease payments that are not paid at that date, including, inter alia, the exercise price of a purchase option if the Company is reasonably certain to exercise that option. Simultaneously, the Company recognizes a right-of-use asset in the amount of the lease liability.

The discount rate applied by the Company is the rate of interest that the Company would have to pay to borrow over a similar term, and with similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment.

The lease term is the non-cancellable period for which the Company has the right to use an underlying asset, together with both the periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option.

After the commencement date, the Company measures the right-of-use asset applying the cost model, less any accumulated depreciation and any accumulated impairment losses and adjusted for any remeasurement of the lease liability. Assets are depreciated by the straight-line method over the lease period, which is 3 years for vehicles and property.

Interest on the lease liability is recognized in profit or loss in each period during the lease term in an amount that produces a constant periodic rate of interest on the remaining balance of the lease liability.

Payments associated with short-term leases are not recognized as right-of-use assets or lease liabilities but are recognized on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less.

New standards and amendments not yet adopted

New standards and amendments not yet adopted

IFRS 18, “Presentation and Disclosure in Financial Statements” (“IFRS 18”)

IFRS 18 replaces IAS 1, “Presentation of Financial Statements” (“IAS 1”). As part of the new disclosure requirements, companies will be required to present new defined subtotals in the statement of profit or loss, as follows: (i) operating profit and (ii) profit before financing and tax. In addition, items in the statement of profit or loss will be classified into three defined categories: operating, investment and financing. The standard also includes a requirement to provide a separate disclosure in the financial statements regarding the use of management-defined performance measures (“non-GAAP measures”), and specific instructions were added for the grouping and splitting of items in the financial statements and their accompanying notes. IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027, with an option for early adoption. The Company is currently in a preliminary stage of assessing the expected effect of this new standard.