REG - Argo Blockchain PLC - Argo 1st Quarter Results
23/05/2024 07:00
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RNS Number : 5563P Argo Blockchain PLC 23 May 2024
Press Release
23 May 2024
Argo Blockchain plc
("Argo" or "the Company")
Q1 2024 Results (Unaudited)
Argo Blockchain plc (LSE: ARB; NASDAQ: ARBK), a global leader in
cryptocurrency mining, is pleased to announce its unaudited financial results
for the quarter ended 31 March 2024. All $ amounts are in United States
Dollars ("USD") unless otherwise stated.
Q1 2024 Financial Results
● The Company ended the quarter with cash of $12.4 million and held
11 Bitcoin ("BTC") or Bitcoin Equivalent
● Reduced debt by $12.4 million during the quarter, a 19% reduction
of the December 31, 2023 balance
● Revenue of $16.8 million, an increase of 4% compared to Q4 2023
● Total BTC mined in the quarter was 319, or 3.5 BTC per day
● Mining margin percentage for the quarter was 38% an increase on
the 34% mining margin percentage achieved in Q4 2023
● Gain on sale of Mirabel facility of $3.0 million, net of tax
● Net loss of $3.2 million
● Adjusted EBITDA of $3.8 million
Management Commentary
Thomas Chippas, Chief Executive Officer of Argo, said: "The Argo team's
continued focus on financial discipline and operational excellence can be seen
in this quarter's results. Q1 was strong in terms of revenue and earnings,
both of which increased compared to Q4 2023. We exited the Bitcoin halving
with cash of over $12 million, Q1 debt reduction of over $12 million and
streamlined Quebec operations resulting from the sale of Mirabel. We are
enthusiastic about Argo's future growth and development, and are dedicated to
delivering value to our shareholders."
Earnings Conference Call
Argo will host a conference call to discuss its results at 10:00 ET / 15:00
BST today, Thursday 23 May 2024. The live webcast of the call can be accessed
via the Investor Meet Company platform.
Investors can sign up to Investor Meet Company and add Argo Blockchain via the
following link:
https://www.investormeetcompany.com/argo-blockchain-plc/register-investor
(https://www.investormeetcompany.com/argo-blockchain-plc/register-investor)
Investors already following Argo Blockchain on the Investor Meet Company
platform will be invited automatically.
Inside Information and Forward-Looking Statements
This announcement contains inside information and includes forward-looking
statements which reflect the Company's current views, interpretations, beliefs
or expectations with respect to the Company's financial performance, business
strategy and plans and objectives of management for future operations. These
statements include forward-looking statements both with respect to the Company
and the sector and industry in which the Company operates. Statements which
include the words "remains confident", "expects", "intends", "plans",
"believes", "projects", "anticipates", "will", "targets", "aims", "may",
"would", "could", "continue", "estimate", "future", "opportunity", "potential"
or, in each case, their negatives, and similar statements of a future or
forward-looking nature identify forward-looking statements. All
forward-looking statements address matters that involve risks and
uncertainties because they relate to events that may or may not occur in the
future, including the risk that the Company may receive the benefits
contemplated by its transactions with Galaxy, the Company may be unable to
secure sufficient additional financing to meet its operating needs, and the
Company may not generate sufficient working capital to fund its operations for
the next twelve months as contemplated. Forward-looking statements are not
guarantees of future performance. Accordingly, there are or will be important
factors that could cause the Company's actual results, prospects and
performance to differ materially from those indicated in these statements. In
addition, even if the Company's actual results, prospects and performance are
consistent with the forward-looking statements contained in this document,
those results may not be indicative of results in subsequent periods. These
forward-looking statements speak only as of the date of this announcement.
Subject to any obligations under the Prospectus Regulation Rules, the Market
Abuse Regulation, the Listing Rules and the Disclosure and Transparency Rules
and except as required by the FCA, the London Stock Exchange, the City Code
or applicable law and regulations, the Company undertakes no obligation
publicly to update or review any forward-looking statement, whether as a
result of new information, future developments or otherwise. For a more
complete discussion of factors that could cause our actual results to differ
from those described in this announcement, please refer to the filings that
Company makes from time to time with the United States Securities and
Exchange Commission and the United Kingdom Financial Conduct Authority,
including the section entitled "Risk Factors" in the Company's Annual Report
on Form 20-F.
Non-IFRS Measures
Bitcoin and Bitcoin Equivalent Mining Margin and Adjusted EBITDA are financial
measures not defined by IFRS. We believe Bitcoin and Bitcoin Equivalent Mining
Margin and Adjusted EBITDA have limitations as analytical tools. In
particular, Bitcoin and Bitcoin Equivalent Mining Margin excludes the
depreciation of mining equipment and so does not reflect the full cost of our
mining operations, and it also excludes the effects of fluctuations in the
value of digital currencies and realized losses on the sale of digital assets,
which affect our IFRS gross profit. Further, Adjusted EBITDA removes such
effects of our capital structure, asset base and tax consequences, but
additionally excludes any unrealized foreign exchange gains or losses,
stock-based compensation charges and other one-time impairments and costs that
are not expected to be repeated in order to provide greater insight into the
cash flow being produced from our operating business, without the influence of
extraneous events. These measures should not be considered as an alternative
to gross margin or net income/(loss), as applicable, determined in accordance
with IFRS, or other IFRS measures. These measures are not necessarily
comparable to similarly titled measures used by other companies. As a result,
you should not consider these measures in isolation from, or as a substitute
analysis for, our gross margin or net income/(loss), as applicable, as
determined in accordance with IFRS.
GROUP STATEMENT OF COMPREHENSIVE INCOME
Figures in '000 except per share Three Months Ended March 31, Three Months Ended March 31, 2023
2024
$ $
Revenues 16,840 11,264
Direct costs (10,439) (6,058)
Mining margin 6,401 5,206
Depreciation of mining equipment (4,833) (6,015)
Change in fair value of digital currencies 293 (77)
Gross profit (loss) 1,861 (886)
Operating costs and expenses (3,152) (3,558)
Restructuring and transaction related fees (561) (797)
Foreign exchange 192 634
Loss on hedging (397) -
Depreciation/amortisation (232) (319)
Share based compensation (1,911) (984)
Operating profit (loss) (4,200) (5,910)
Gain on sale of subsidiary (Mirabel) 3,397 -
Gain on disposal of fixed assets 75 -
Finance costs (2,317) (3,283)
Other income 230 1
Profit/(loss) before taxation (2,815) (9,192)
Tax credit / (expense) (340) -
Profit/(loss) after taxation (3,155) (9,192)
Other comprehensive income
Items which may be subsequently reclassified to profit or loss:
Currency translation reserve 728 (401)
Total other comprehensive income (loss), net of tax 728 (401)
Total comprehensive loss attributable to the equity holders of the Company (2,426) (9,593)
Earnings per share attributable to equity owners
Basic loss per share $(0.01) $(0.02)
Diluted loss per share $(0.01) $(0.02)
The income statement has been prepared on the basis that all operations are
continuing operations.
GROUP STATEMENT OF FINANCIAL POSITION
As at March 31, As at December 31,
2024 2023
Figures in '000 $ $
ASSETS
Non-current assets
Investments at fair value through profit or loss 400 400
Investments accounted for using the equity method - -
Intangible fixed assets 1,044 888
Property, plant and equipment 53,771 59,728
Right of use assets - -
Total non-current assets 55,215 61,016
Current assets
Cash and cash equivalents 12,444 7,443
Trade and other receivables 2,214 3,835
Assets held for sale - 3,261
Digital assets 810 385
Total current assets 15,468 14,924
Total assets 70,683 75,940
EQUITY AND LIABILITIES
Equity
Share Capital 763 712
Share Premium 219,522 209,779
Share based payment reserve 12,680 11,844
Currency translation reserve (30,858) (30,129)
RSU/PSU Reserve 1,156 322
Accumulated surplus / (deficit) (195,525) (192,370)
Total equity 7,738 158
Current liabilities
Trade and other payables 10,670 11,175
Loans and borrowings 12,680 14,320
Corporation Tax 449 -
Liabilities associated with assets held for sale - 2,090
Total current liabilities 23,799 27,585
Non-current liabilities
Issued debt - bond 38,346 38,170
Loans 800 10,027
Total liabilities 62,945 75,782
Total equity and liabilities 70,683 75,940
GROUP STATEMENT OF CASH FLOWS
Three Months Ended March 31, Three Months Ended March 31,
2024 2023
Figures in '000 $ $
Cash flows from operating activities
Loss before tax (2,815) (9,192)
Adjustments for:
Depreciation/Amortisation 5,065 6,334
Foreign exchange (192) (634)
Fair value change in digital assets through profit or loss (293) 78
Revenue from digital assets (16,840) (11,438)
Loss on hedging 397 -
Finance cost 2,317 3,283
Gain on disposal of fixed assets (75) -
Proceeds from sale of digital assets 16,423 11,783
Share based compensation 1,911 984
Gain on sale of subsidiary (3,397) -
Cash flow from operating activities before working capital changes 2,500 1,197
Working capital changes:
Increase in trade and other receivables 1,086 (514)
Decrease in trade and other payables (307) (3,359)
Income taxes paid - (213)
Net cash used in operating activities 3,279 (2,889)
Investing activities
Interest received 126 -
Proceeds from sale of tangible fixed assets 894 -
Proceeds from sale of subsidiary and investment 6,119 -
Net cash used in investing activities 7,139 -
Financing activities
Lease payments - -
Loan repayments (12,617) (245)
Interest paid (1.966) (2,424)
Proceeds from shares issued - net of issue costs 9,349 -
Net cash generated used in financing activities (5,234) (2,669)
Net decrease in cash and cash equivalents 5,185 (5,558)
Effect of foreign exchange on cash (184) 16
Cash and cash equivalents, beginning of period 7,443 20,092
Cash and cash equivalents at end of period 12,444 14,550
The table below reconciles Adjusted EBITDA to net income/(loss), the most
directly comparable IFRS measure, for the three months ended 31 March 2024 and
three months ended 31 March 2023.
Three Months Ended March 31, Three Months Ended March 31,
2024 2023
Figures in '000 $ $
Net income/(loss) (3,155) (9,192)
Interest expense 2,317 3,283
Depreciation / amortisation 5,065 6,334
Income tax (credit) / expense 340 -
EBITDA 4,567 425
Restructuring and transaction related fees 561 797
Foreign exchange gain (192) (634)
Share based payment charge 1,911 984
Gain on sale of investment (3,397) -
Loss on hedging 397 -
Adjusted EBITDA 3,847 1,572
For further information please contact:
Argo Blockchain
Investor Relations ir@argoblockchain.com
Tennyson Securities
Corporate Broker +44 207 186 9030
Peter Krens
Fortified Securities
Joint Broker +44 74930989014
Guy Wheatley, CFA guy.wheatley@fortifiedsecurities.com
(mailto:guy.wheatley@fortifiedsecurities.com)
Tancredi Intelligent Communication argoblock@tancredigroup.com (mailto:argoblock@tancredigroup.com)
UK & Europe Media Relations
About Argo:
Argo Blockchain plc is a dual-listed (LSE: ARB; NASDAQ: ARBK) blockchain
technology company focused on large-scale cryptocurrency mining. With mining
facilities in Quebec, mining operations in Texas, and offices in the US,
Canada, and the UK, Argo's global, sustainable operations are predominantly
powered by renewable energy. In 2021, Argo became the first climate positive
cryptocurrency mining company, and a signatory to the Crypto Climate Accord.
For more information, visit (http://www.argoblockchain.com/)
www.argoblockchain.com (http://www.argoblockchain.com/) .
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