Form 6-K Argo Blockchain Plc Due: Jan. 11

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UNITED STATES

SECURITY AND EXCHANGE COMMISSION

Washington, DC 20549

_____________________

FORM 6-K

_____________________

REPORT FROM FOREIGN PRIVATE ISSUERS

PURSUANT TO RULE 13a-16 OR 15d-16

PURSUANT TO THE SECURITIES ACT OF 1934

For the month of January 2023

Commission file number: 001-40816

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Argo Blockchain plc

(Translation of registrant’s name into English)

_____________________

9th floor

16 Great Queen Street

London WC2B 5DG

England

(Address to head office)

_____________________

Indicate with a tick if the registrant submits or will submit annual reports under the guise of form 20-F or form 40-F.

Form 20-F ☒ Form 40-F
☐

Indicate with a check mark if the registrant files the Form 6-K on paper as permitted by Rule ST Rule 101(b)(1): ☐

Indicate with a check mark if the registrant files the Form 6-K on paper as permitted by Rule ST Rule 101(b)(7): ☐

EXHIBITION INDEX

Press release

11 January 2023

Argo Blockchain plc

(“Argo” or the “Company”)

Operational update December 2022

During the month of December, Argo mined 147 Bitcoin or Bitcoin Equivalents (total BTC) compared to 198 BTC in November 2022. The decrease in BTC mined was primarily due to curtailment of mining operations at the Helios facility in Dickens County, Texas in response to the widespread winter storm which affected large parts of the United States at the end of December. The Helios facility draws power from the Texas grid and can reduce power consumption during extreme weather events or times of grid stress. During the winter storm, Argo joined other Texas Bitcoin miners in reducing power consumption by an estimated 1,500 MW, according to the Texas Blockchain Council. Argo has always been committed to being a good community partner, and the company is proud to have contributed to the stability of the Texas power grid during the winter storm.

As of December 31, 2022, the company held 141 Bitcoins, of which 116 were Bitcoin equivalents.

The company’s total hash rate capacity is still 2.5 EH/s.

Based on daily exchange rates and cryptocurrency prices during the month, mining revenue in December was $2.49 million [£2.07 million*] (November 2022 $3.46 million
[£2.94 million*].

Argo generated this income with a Bitcoin and Bitcoin equivalent mining margin of 48% for the month of December (November 2022: 29%).

Sale of Helios to Galaxy

As previously announced on December 29, 2022, the company terminated a series of agreements with Galaxy Digital Holdings Ltd. (TSX: GLXY) (“Galaxy”) to sell its Helios facility to Galaxy for $65 million (£54 million), refinancing its existing equipment finance loan with a new asset-backed loan from Galaxy in the amount of $35 million (£29 million) , and host Argos mining machines on Helios. The transactions improve the company’s balance sheet and liquidity by reducing total debt by $41 million (£34 million) and improving its cash position. As at 31 December 2022, pro forma for the transactions, the company’s total debt was approximately $79 million (£65 million), and the bank balance was approximately $20 million (£16 million).

The transactions with Galaxy also make the company’s operations more efficient. Argo maintains ownership of its entire fleet of mining machines, and Galaxy will host its fleet of Bitmain S19J Pro machines on Helios. In addition, Argo maintains ownership of its two data centers in Quebec, which have a combined power capacity of approx. 20 MW and attractive power prices.

In connection with the sale of Helios and changing priorities for the company, Justin Nolan (Chief Growth Officer) and Theodore Papadakis (VP ​​Data Center Operations) have left Argo. Argo is grateful for their contribution to the company during their tenure and wishes them well in their future endeavours.

Management commentary

Argo CEO Peter Wall said: “While our mining results for December were lower than expected, the primary driver was the winter storm which led to us curtailing operations at Helios. We took this decision to not only reduce grid power consumption, but also to prioritizing the needs of the local community and the safety of our Helios employees. After the winter storm and associated freezing temperatures subsided, we brought Helios safely back online and resumed operations.”

Commenting on the Galaxy transaction, Wall said: “These agreements with Galaxy mark the beginning of a new chapter for Argo. We built a world-class mining facility at Helios and I believe Galaxy has the right team and resources to build on that foundation which Argo established. This agreement also enables Argo to continue our mining operations, both at Helios as a host customer, as well as at our owned and operated facilities in Quebec. I look forward to sharing more details on our growth strategy for 2023 and beyond gradually.”

Non-IFRS measures

Bitcoin and Bitcoin Equivalent Mining Margin is a financial measure 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 excludes impairment of mining equipment and therefore does 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 the sale of digital assets, which affect our IFRS gross profit. This measure should not be considered as an alternative to gross margin determined in accordance with IFRS, or other IFRS measures. 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 under IFRS.

The table below shows a reconciliation of Bitcoin Gross Margin and Bitcoin Equivalent Mining Margin, the most directly comparable IFRS measure, for the months of November 2022 and December 2022.

(1) Due to unfavorable changes in fair value of BTC, there was a loss on change in fair value of digital currencies in November 2022. Due to favorable changes in fair value of BTC, there was a gain on change in fair value of digital currencies in December 2022.

* Dollar values ​​translated from pounds sterling to US dollars using the noon buying rate of the Federal Reserve Bank of New York on current dates

Inside information and forward-looking statements

This announcement contains inside information and includes forward-looking statements that reflect the current views, interpretations, beliefs or expectations of the Company or, as applicable, the Board of Directors with respect to the Company’s financial results, business strategy and management’s plans and objectives 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 that include the words “remains confident”, “expects”, “intends”, “plans”, “believes”, “projects”, “anticipates”, “will”, “goals”, “goals”, “may” “would”, “could”, “continue”, “estimate”, “future”, “possibility”, “potential” or, in each case, their negative aspects, and similar statements of a future or forward-looking nature identify forward-looking statements . All forward-looking statements involve 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 the transactions with Galaxy, the Company may be unable to to secure sufficient additional financing to meet its operating needs, and the Company may not generate sufficient working capital to fund its operations in the next twelve months as anticipated. Forward-looking statements are not guarantees of future performance. Consequently, there are or will be important factors that may lead to the company’s actual results, prospects and results deviating significantly from those stated 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, these 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, 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 laws and regulations, the Company undertakes no public obligation 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 the Company files 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 Registration Statement on Form F-1.

For further information please contact:

About Argo:

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, and thereby duly authorized.