v3.26.1
INTANGIBLE ASSETS, NET AND GOODWILL
 12 Months Ended
Dec. 31, 2025
Disclosure of detailed information about intangible assets [abstract]  
INTANGIBLE ASSETS, NET AND GOODWILL

NOTE 6 - INTANGIBLE ASSETS, NET AND GOODWILL:

 SUMMARY OF INTANGIBLE ASSETS NET 

   Capitalization of development costs   Purchased license   Core Technology License   Total 
                 
COST                    
As of January 1, 2025   5,266    782    10,449    16,497 
Currency translation adjustments   194    58    -    252 
As of December 31, 2025   5,460    840    10,449    16,749 
                     
Accumulated amortization                    
As of January 1, 2025   2,788    75    1,306    4,169 
Amortization   534    103    2,612    3,249 
Impairment   1,542    -    -    1,542 
Currency translation adjustments   (121)   (6)   -    (127)
As of December 31, 2025   4,743    172    3,918    8,833 
                     
Net book value as of December 31, 2025   717    668    6,531    7,916 

 

   Capitalization of development costs   Purchased license   Core Technology License   Total 
                 
COST                    
As of January 1, 2024   5,342    819    10,449    16,610 
Capitalized development cost   169    -    -    169 
Currency translation adjustments   (245)   (37)   -    (282)
As of December 31, 2024   5,266    782    10,449    16,497 
                     
Accumulated amortization                    
As of January 1, 2024   124    -    -    124 
Amortization   694    75    1,306    2,075 
Impairment   2,197    -    -    2,197 
Currency translation adjustments   (227)   -    -    (227)
As of December 31, 2024   2,788    75    1,306    4,169 
                     
Net book value as of December 31, 2024   2,478    707    9,143    12,328 

 

Intangible assets as of December 31, 2025 and 2024 consist of capitalized development costs of the Group’s technology, the cost of the exclusive license intellectual property and core technology license raised from the TrueGold business combination that reflects the existence of underlying technology that has value through its continued use or re-use in many products or many generations of a singular product (that is, a product family). The capitalized development costs and purchased license are amortized in accordance with its useful life of 5.5 years. The Core Technology License is amortized in accordance with its useful life of 4 years. The Company commenced amortization of both the capitalized development costs and purchased licenses and core technology as of July 1, 2024.

 

 

SMX (SECURITY MATTERS) PUBLIC LIMITED COMPANY

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(US$ in thousands except share and per share data)

 

NOTE 6 - INTANGIBLE ASSETS, NET AND GOODWILL (CONT.):

 

Goodwill and impairment

 

The Group is required to test, on an annual basis, whether goodwill has suffered any impairment. The recoverable amount is determined based on value in use calculations. The use of this method requires an estimation of future cash flows and the determination of a discount rate in order to calculate the present value of the cash flows.

 

During 2025 and 2024, the Group did not meet its revenue forecast. This had an adverse impact on the projected value in use of the operation and consequently resulted in an impairment to goodwill of $6,024 and $6,813 for the years ended December 31, 2025, and 2024 respectively. The (pre-tax) discount rate used to measure the CGU’s value in use was 30.0% and 29.6% for the years ended December 31, 2025, and 2024 respectively.

 

The carrying amount of goodwill is $20,120 and $26,144 for the years ended December 31, 2025, and 2024 respectively.

 

The recoverable amount has been determined using value in use calculations based on cash flow projections derived from Company approved budgets, reflecting management’s expectation.