Argo Blockchain PLC announces operational update from June 2022

LONDON, United Kingdom / ACCESSWIRE / July 7, 2022 / Argo Blockchain plc, a global leader in cryptocurrency mining, (LSE: ARB) (NASDAQ: ARBK)is pleased to provide the following operational update for June 2022.

During the month of June, Argo recovered 179 Bitcoin or Bitcoin Equivalents (total, BTC) compared to 124 BTC in May 2022. The increase in BTC recovered is primarily due to an increase in total hash rate capacity and greater uptime at the Helios facility compared to last month .

Based on daily exchange rates and cryptocurrency prices during the month, mining revenues in June amounted to £ 3.38 million. [$4.35 million*] (May 2022: £ 3.07 million [$3.89 million*]).

Argo generated this revenue with a Bitcoin and Bitcoin equivalent mining margin of 50% for June (May 2022: 55%)¹. This reduction in the mining margin was primarily driven by the reduced price of Bitcoin and higher electricity costs at Helios.

As of June 30, 2022, the company had 1,953 Bitcoin, of which 210 were BTC equivalents.

(1) Bitcoin and Bitcoin Equivalent Mining Margin for May 2022 were previously reported to be 62%; however, certain fee invoices for Helios were not received and were not included in the previous calculation.

Financing update

During the month of June, the company sold 637 Bitcoin at an average price of approximately $ 24,500. The income was used to finance operating expenses and growth capital, as well as to reduce liabilities under a BTC-supported loan agreement with Galaxy Digital. This is in line with the company’s risk management strategy which has been in place since January 2022. Throughout 2022, the company has sold a significant portion of its monthly Bitcoin production, regularly reducing its exposure to its BTC-backed loan and strengthening its balance sheet. sheet. As of June 30, 2022, the company had an outstanding balance of $ 22 million under the BTC-backed loan. The company is convinced that it has sufficient liquidity to avoid potential settlement of the BTC-supported loan if the Bitcoin price continues to fall.

The story continues

Since the fourth quarter of 2021, the company has used derivatives to limit downside risk. Furthermore, in June 2022, the company hired a full-time derivatives trader to expand its internal capabilities in risk and financial management.

Helios update

During the month of June, delivery and installation of the company’s S19J Pro machines ordered from Bitmain continued in line with the schedule set in September 2021. As of June 30, 2022, the company has paid in excess of 95% of the total purchase price for the Bitmain machines. , which includes discounts received as a result of the decline in the price of Bitcoin. During the month of June, the company increased its total hash rate capacity to 2.2 EH / s. The company will continue to install all 20,000 machines purchased from Bitmain by October 2022.

In addition, the company continued to make progress in implementing its machine replacement agreement with Core Scientific. As of June 30, 2022, 5,000 S19J Pro machines have been delivered and installed under this agreement.

“Ongoing efforts to significantly scale up Argos ‘mining operations are reflected in this month’s figures and our increased hash rate,” said Peter Wall, Argos’ CEO. “These figures, together with our continued installations of the S19J Pro machines, put us in a solid position in terms of our mining capacity.

“We have seen positive results from our risk management strategy, where we have reduced the company’s exposure to its BTC-backed loans, and we have hired a full-time derivatives trader. We believe the company is well positioned to navigate current market conditions and further increase our efficiency. . “

Non-IFRS objectives

Bitcoin and Bitcoin Equivalent Mining Margin is a financial target that is not defined by IFRS. We believe Bitcoin and Bitcoin Equivalent Mining Margin have limitations as an analytical tool. In particular, Bitcoin and Bitcoin Equivalent Mining Margin exclude depreciation of mining equipment and therefore do not reflect the full cost of our mining operations, and it also excludes the effect of fluctuations in the value of digital currencies and realized losses on digital asset sales, which affect our IFRS gross profit. This measure should not be considered as an alternative to the gross margin determined in accordance with IFRS, or other IFRS objectives. This measure is not necessarily comparable to similar titles used by other companies. As a result, you should not consider this measure in isolation from, or as a replacement analysis for, our gross margin as determined in accordance with IFRS.

The table below shows a reconciliation of the gross margin to Bitcoin and the Bitcoin Equivalent Mining Margin, the most directly comparable IFRS target, for the months of May 2022 and June 2022.

(1) Certain fee invoices for Helios were not received and could not be included in the previous calculations for: Gross (loss) (Previously reported in May 2022 to £ 11,719,569 / $ 14,650,191), Gross margin (Previously reported in May 2022 to be 377%), Mining Profit (Previously reported in May 2022 to be £ 1,926,383 / $ 2,408,099) and Bitcoin and Bitcoin Equivalent Mining Margin (Previously reported in May 2022 to be 62%).

(2) Due to unfavorable changes in the fair value of Bitcoin and Bitcoin Equivalents in May 2022 and June 2022, there was a loss on change in the fair value of digital currencies.

* Dollar values ​​translated from Pound Sterling to US Dollars using the dinner purchase price of the Federal Reserve Bank of New York on effective dates

Inside information and future-oriented statements

This announcement contains inside information and includes forward-looking statements that reflect the company’s or, as appropriate, the board’s current views, interpretations, beliefs or expectations regarding the company’s financial results, business strategy and plans and goals for management for future operations. These statements include forward-looking statements regarding both the company and the sector and industry in which the company operates. Statements that include the words “expect”, “intend”, “plan”, “believe”, “projects”, “predict”, “will”, “goal”, “goal”, “can”, “would”, “could”, “continue”, “estimate”, “future”, “opportunity”, “potential” or, in each case, their negative and similar statements of a future or forward-looking nature identify forward-looking statements. All forward-looking statements deal with matters involving risk and uncertainty because they are related to events that may or may not occur in the future. Future-oriented statements are not guarantees for future performance. Consequently, there are or will be important factors that may cause the Company’s actual results, prospects and results to differ materially from those set forth in these statements. In addition, although the Company’s actual results, prospects and performance are consistent with the forward-looking statements in this document, these results may not be an indication of results in subsequent periods. These forward-looking statements apply only from the date of this announcement. Subject to any obligations under the Prospectus Ordinance, the Market Abuse Ordinance, the Listing Rules and the Disclosure and Transparency Rules, and except as required by the FCA, London Stock Exchange, City Code or applicable laws 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 may cause our actual results to differ from those described in this notice, please see the records that the Company submits to the United States Securities and Exchange Commission and the United Kingdom Financial Conduct Authority from time to time. including the section entitled “Risk Factors” in the Company’s Registration Form on Form F-1.

For further information please contact:

About Argo:

Argo Blockchain plc is a double-listed (LSE: ARB; NASDAQ: ARBK) blockchain technology company that focuses on large-scale mining of cryptocurrencies. With its flagship mining facility in Texas, and offices in the United States, Canada and the United Kingdom, Argos’ global, sustainable operations are primarily powered by renewable energy. In 2021, Argo became the first climate-positive mining company for cryptocurrency, and signed the Crypto Climate Accord. Argo also participates in several Web 3.0, DeFi and GameFi projects through the Argo Labs division, and further contributes to business operations, as well as the development of the cryptocurrency markets. For more information, visit www.argoblockchain.com.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a primary information provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For more information, please contact [email protected] or visit www.rns.com.

SOURCE: Argo Blockchain PLC

See the source version on accesswire.com: