Bitfarms Ltd. (Nasdaq/TSX: BITF), a global vertically integrated
Bitcoin data center company, reported its financial results for the
third quarter ended September 30, 2024. All financial
references are in U.S. dollars.
During the quarter, Bitfarms continued to
execute its transformational fleet upgrade and executed upon its
strategic rebalancing and expansion of its operations in the
U.S.
To that end, Bitfarms announced its acquisition
of Stronghold Digital Mining, Inc. (Nasdaq: SDIG) ("Stronghold"),
which is expected to put Bitfarms on track to increase its energy
portfolio to over 950 MW by year-end 2025 with potential for
multi-year expansion capacity of up to 1.6 GW. This represents a
significant shift of Bitfarms' portfolio towards the U.S., which
will come to represent approximately 66% of the Company's total
portfolio, an eleven-fold increase from 6% operating power in the
U.S. today. Bitfarms has already begun maximizing the utility of
the Stronghold sites with two consecutive hosting agreements
totaling 20,000 miners, signed in September and October, supporting
approximately 4 EH/s. Upon close of the Stronghold acquisition,
these hosting agreements will revert to self-mining operations.
The Company continues to make progress on its
fleet upgrade program, deploying 5,400 additional miners during the
quarter and achieving its efficiency target of 21 w/TH three months
ahead of schedule. This efficiency represents a 40% improvement
year-to-date, reducing direct operating costs per terahash and
improving gross margins.
In addition, Bitfarms will be upgrading the
remaining 18,853 T21 miners to be delivered by Bitmain as part of
Bitfarms’ fleet upgrade program announced last year. Under the
agreement, Bitfarms will be installing more powerful and efficient
S21 Pro miners, operating at 234 TH/s and 15 w/TH, which represents
more than a 20% improvement from the T21 miners in both energy
efficiency and hashrate.
During the quarter, Bitfarms took significant
steps to strengthen its leadership team with new hires and a new
management structure, providing greater scalability and
accountability in data center development and operations, and
laying the foundation for the establishment of HPC/AI operations.
Bitfarms also strengthened its corporate governance with the
appointment of two new directors and the appointment of the former
Lead Director to Independent Chairman. The Bitfarms Board of
Directors now consists of five members, four of whom are
independent. The Company will hold a Special Meeting on November
20th to vote on an expansion of the Board from five to six members,
the nomination of Andrew J. Chang to the Board, and the
ratification of the Company’s Shareholder Rights Plan.
In line with its strategy to diversify beyond
Bitcoin mining and maximize the value of its power assets, Bitfarms
has selected two U.S. sites for a one to two MW HPC/AI pilot site.
While still early stages, the land and power are secured at both
sites, with active conversations taking place with potential
partners and suppliers to discuss potential accelerated deployment
in 2025. The Company is currently in the process of finalizing
terms, plans and budgets as the first step in executing a
comprehensive long-term HPC/AI strategy.
CFO Jeff Lucas concluded, “Despite third quarter
headwinds of record low hashprices for the Bitcoin mining industry,
a 62% year-over-year increase in network difficulty, and the first
full quarter following the April Halving Event, our mining
operations remained profitable and continued to drive free cash
flow. While we achieved our year-end efficiency target of 21 w/TH
in the third quarter, shipping delays and continued miner servicing
of our Bitmain T21s impacted our ability to reach 21 EH/s in 2024.
We are working closely with Bitmain on warranty servicing and miner
upgrades and expect to reach 21 EH/s in the first half of
2025.”
“As previously communicated, 2024 has been a
transformative year for Bitfarms,” stated CEO Ben Gagnon.
“Year-to-date, we’ve refreshed nearly our entire fleet of miners,
significantly improving our mining economics, acquired one new site
and entered agreements to acquire two additional new sites in the
U.S., and completely revamped our operational and Board structure,
strengthening our leadership and corporate governance. We are now
uniquely positioned with a strategic pipeline of over 950 MW in
2025 with nearly half a gigawatt of power infrastructure
unallocated with miners. This represents a massive, secured, and
cost-effective near-term growth opportunity with the flexibility
necessary to maximize shareholder value as we approach the
anticipated 2025 Bitcoin bull cycle.”
Q3 2024 & Recent Operating
Highlights
Operations
- Current hashrate of 11.9 EH/s, up
from 10.4 EH/s in Q2 2024.
- Averaged 7.6 BTC per day in daily
production for Q3 2024.
Data Center Portfolio Expansion &
Fleet Upgrade
- Deployed 5,400 additional miners
across three data centers in Canada, U.S., and Paraguay, for a
total of approximately 47,900 miners deployed year-to-date in
2024.
- Entered into a definitive merger
agreement, pursuant to which the Company will acquire Stronghold, a
vertically integrated crypto asset mining company with operations
located in Pennsylvania, in a stock-for-stock merger
transaction.
- Closed the lease agreement in
Sharon, Pennsylvania, providing the Company with an immediate
capacity of 12 MW of electricity with up to 98 MW of additional
development capacity. Bitfarms also signed a letter of intent for a
lease to an additional 10 MW site, which would bring total site
capacity to 120 MW.
- Entered into two miner hosting
agreements with Stronghold as of October 31, 2024, which will
accelerate the deployment of 20,000 miners supporting approximately
4.0 EH/s.
- On November 12, 2024, the Company
amended its agreements with Bitmain to upgrade the remaining 18,853
Bitmain T21 miners to be delivered by Bitmain to superior
performing S21 Pro miners. The upgrade will cost an incremental
$33.2 million payable in cash or Bitcoin with the option for the
Company to redeem the Bitcoin for cash in four quarterly payments
based on the price of Bitcoin at the time the Bitcoin is originally
tendered.
Personnel Appointments & Corporate
Updates
- Appointed Ben Gagnon as Chief
Executive Officer (“CEO”) and Director of the Board of Directors
(“the Board”), Liam Wilson as Chief Operating Officer, Benoit
Gobeil as Chief Infrastructure Officer, Alex Brammer as SVP of
Mining Operations, and Rachel Silverstein as U.S. General
Counsel.
- Appointed Amy Freedman as
Independent Director of the Board and Lead Director Brian Howlett
as Independent Chairman of the Board; accepted the resignations of
Nicolas Bonta and Andrés Finkielsztain from the Board.
- Entered into a settlement agreement
with Riot Platforms, Inc. on September 24, 2024
- Settled the employment dispute with
the former CEO.
- Nominated Andrew Chang for election
to the Board at the Special Meeting of Shareholders, taking place
on November 20, 2024.
Q3 2024 Financial
Highlights
- Total revenue of $45 million, up 8%
Q/Q.
- Gross mining profit* and gross
mining margin* of $17 million and 38%, respectively, down from $21
million and 51% in Q2 2024, respectively.
- General and administrative expenses
of $28 million, up 123% Q/Q.
- Operating loss of $44 million,
which included $10 million accelerated depreciation on older miners
in connection with the transformative fleet upgrade, compared to an
operating loss of $24 million in Q2 2024, which included $46
million accelerated depreciation on older miners.
- Net loss of $37 million, or $(0.08)
per basic and diluted share which included a $6 million non-cash
gain for revaluation of warrant liabilities in connection with 2023
financing activities. This compares to a net loss of $27 million,
or $(0.07) per basic and diluted share in Q2 2024, which included a
$1 million non-cash expense for revaluation of warrant liabilities
in connection with 2021 and 2023 financing activities.
- Adjusted EBITDA* of $6 million, or
14% of revenue, down from $12 million, or 28% of revenue, in Q2
2024.
- The Company earned 703 BTC at an
average direct cost of production per BTC* of $36,000, compared to
$30,600 in Q2 2024.
- Total cash cost of production per
BTC* was $52,400 in Q3 2024, up from $47,300 in Q2 2024 due to
higher energy cost, increased network difficulty and lower
transaction fees.
Liquidity**As of
September 30, 2024, the Company had total liquidity** of $146
million, comprised of $73 million in cash and 1,147 BTC valued at
$73 million based on a BTC price of $63,300 at September 30,
2024. As of October 31, 2024, the Company held 1,188 BTC.
Q3 2024 and Recent Financing
Activities
- Sold 461 BTC at an average price of
$60,600 for total proceeds of $28 million in Q3 2024 and sold 194
of the 236 BTC earned during October 2024, generating total
proceeds of $13 million. A portion of the funds was used to pay
capital expenditures.
- Added 41 BTC to treasury in October
2024 for a total of 1,188 BTC held in treasury, representing a
total value of $84 million based on a $71,000 BTC price on
October 31, 2024.
- Synthetic HODL increased to 802 as
of October 31, 2024 from 208 Bitcoin in Q2 2024, up 286%.
- Raised $66 million in net proceeds
during Q3 2024 bringing the total year-to-date net proceeds to $279
million through November 12th, 2024 through the Company's 2024
at-the-market equity offering program.
- Deposited a total of $15.6 million
with Stronghold as of October 31, 2024, which is refundable on
December 31, 2025, in connection with the two hosting
agreements.
- Collected the remaining $5 million
balance of the Canadian sales tax recovery of the approximately $24
million total claims between February 5, 2022 and April 2024, for
which the refund was confirmed by the provincial tax authorities in
the second quarter of 2024.
Quarterly Operating
Performance
|
|
Q3 2024 |
Q2 2024 |
Q3 2023 |
|
Total BTC earned |
703 |
614 |
1,172 |
| Average Watts/Average TH
efficiency*** |
23 |
28 |
36 |
| BTC
sold |
461 |
515 |
1,018 |
|
|
As of September 30, |
As of June 30, |
As of September 30, |
|
|
2024 |
2024 |
2023 |
|
Operating EH/s |
11.3 |
10.4 |
6.1 |
| Operating capacity (MW) |
310 |
310 |
234 |
|
Hydropower (MW) |
256 |
256 |
183 |
Quarterly Average Revenue**** and Cost
of Production per BTC*
|
|
Q3 2024 |
Q2 2024 |
Q1 2024 |
Q4 2023 |
Q3 2023 |
|
Avg. Rev****/BTC |
$60,900 |
$65,800 |
$52,400 |
$36,400 |
$28,100 |
| Direct Cost*/BTC |
$36,000 |
$30,600 |
$18,400 |
$14,400 |
$15,100 |
|
Total Cash Cost*/BTC |
$52,400 |
$47,300 |
$27,900 |
$23,200 |
$20,800 |
* Gross mining profit, gross mining margin,
EBITDA, EBITDA margin, Adjusted EBITDA, Adjusted EBITDA margin,
Direct Cost per BTC and Total Cash Cost per BTC are non-IFRS
financial measures or ratios and should be read in conjunction
with, and should not be viewed as alternatives to or replacements
of measures of operating results and liquidity presented in
accordance with IFRS. Readers are referred to the reconciliations
of non-IFRS measures included in the Company’s MD&A and at the
end of this press release.** Liquidity represents cash and balance
of digital assets.*** Average watts represent the energy
consumption of miners. **** Average revenue per BTC is for mining
operations only and excludes Volta revenue.
Conference Call
Management will host a conference call today at
8:00 am EST. A presentation of the Q3 2024 results will be
accessible before the call on the Investor website and can be
accessed here.
The live webcast and a webcast replay of the
conference call can be accessed here. To access the call by
telephone, register here to receive dial-in numbers and a unique
PIN to join the call.
Upcoming Conferences & Events
November 14: Cantor Crypto, Digital Assets &
AI Infrastructure Conference (Miami) November 19-20: ROTH
Technology Conference (NYC) November 20: Special Meeting of
Bitfarms Shareholders (Virtual) December 4: B. Riley Crypto &
Energy Infrastructure Conference (NYC) December 12: Northland
Growth Conference (Virtual) January 14-15, 2025: Needham Growth
Conference (NYC)
Non-IFRS Measures*As a Canadian
company, Bitfarms follows International Financial Reporting
Standards (IFRS) which are issued by the International Accounting
Standard Board (IASB). Under IFRS rules, the Company does not
reflect the revaluation gains on the mark-to-market of its Bitcoin
holdings in its income statement. It also does not include the
revaluation losses on the mark-to-market of its Bitcoin holdings in
Adjusted EBITDA, which is a measure of the cash profitability of
its operations and does not reflect the change in value of its
assets and liabilities.
The Company uses Adjusted EBITDA to measure its
operating activities' financial performance and cash generating
capability.
2023 Restatement During the
preparation of the Company's financial statements for the year
ended December 31, 2023, the Company reassessed the application of
IFRS Accounting Standards on the accounting for warrants issued in
connection with private placement financings conducted in 2021 and,
as such, restated (the “Restatement”) its consolidated statements
of financial position as of December 31, 2022 and January 1, 2022,
its consolidated statements of profit or loss and comprehensive
profit or loss for the year ended December 31, 2022,and the three
and nine months ended September 30, 2024 and its consolidated
statements of cash flows for the year ended December 31, 2022 and
the nine months ended September 30, 2023, which were
previously filed on SEDAR+ and EDGAR. For further details, consult
Note 3e of the audited consolidated financial statements for the
year ended December 31, 2023, and Note 3d of the interim condensed
consolidated financial statements for the three and nine months
ended September 30, 2024, available on SEDAR+ and EDGAR. As
described in the interim MD&A for three and nine months ended
September 30, 2024, available on SEDAR+ and EDGAR, the Company
is undertaking remediation efforts in light of the Restatement and
in order to improve the overall effectiveness of its internal
control over financial reporting for the accounting of complex
financial instruments.
About Bitfarms Ltd.Founded in
2017, Bitfarms is a global Bitcoin data center company that
contributes its computational power to one or more mining pools
from which it receives payment in Bitcoin. Bitfarms develops, owns,
and operates vertically integrated mining farms with in-house
management and company-owned electrical engineering, installation
service, and multiple onsite technical repair centers. The
Company’s proprietary data analytics system delivers best-in-class
operational performance and uptime.
Bitfarms currently has 12 operating Bitcoin data
centers and two under development, and two under Hosting
agreements, situated in four countries: Canada, the United States,
Paraguay, and Argentina. Powered predominantly by environmentally
friendly hydro-electric and long-term power contracts, Bitfarms is
committed to using sustainable and often underutilized energy
infrastructure.
To learn more about Bitfarms’ events,
developments, and online communities:
www.bitfarms.comhttps://www.facebook.com/bitfarms/https://twitter.com/Bitfarms_iohttps://www.instagram.com/bitfarms/https://www.linkedin.com/company/bitfarms/
Glossary of Terms
- BTC BTC/day = Bitcoin or Bitcoin per day
- EH or EH/s = Exahash or exahash per second
- MW or MWh = Megawatts or megawatt hour
- w/TH = Watts/Terahash efficiency (includes cost of powering
supplementary equipment)
- Q/Q = Quarter over Quarter
- Y/Y = Year over Year
- Synthetic HODL™ = the use of instruments that create Bitcoin
equivalent exposure
- HPC/AI = High Performance Computing / Artificial
Intelligence
Forward-Looking Statements
This news release contains certain
“forward-looking information” and “forward-looking statements”
(collectively, “forward-looking information”) that are based on
expectations, estimates and projections as at the date of this news
release and are covered by safe harbors under Canadian and United
States securities laws. The statements and information in this
release regarding the impact of the hosting agreements, projected
growth, target hashrate, opportunities relating to the Company’s
geographical diversification and expansion, deployment of miners as
well as the timing therefore, closing of the Stronghold acquisition
on a timely basis and on the terms as announced, the ability to
gain access to additional electrical power and grow hashrate of the
Stronghold business, performance of the plants and equipment
upgrades and the impact on operating capacity including the target
hashrate and multi-year expansion capacity, the opportunities to
leverage Bitfarms’ proven expertise to successfully enhance energy
efficiency and hashrate, and other statements regarding future
growth, plans and objectives of the Company are forward-looking
information.
Any statements that involve discussions with
respect to predictions, expectations, beliefs, plans, projections,
objectives, assumptions, future events or performance (often but
not always using phrases such as “expects”, or “does not expect”,
“is expected”, “anticipates” or “does not anticipate”, “plans”,
“budget”, “scheduled”, “forecasts”, “estimates”, “prospects”,
“believes” or “intends” or variations of such words and phrases or
stating that certain actions, events or results “may” or “could”,
“would”, “might” or “will” be taken to occur or be achieved) are
not statements of historical fact and may be forward-looking
information.
This forward-looking information is based on
assumptions and estimates of management of Bitfarms at the time
they were made, and involves known and unknown risks, uncertainties
and other factors which may cause the actual results, performance,
or achievements of Bitfarms to be materially different from any
future results, performance or achievements expressed or implied by
such forward-looking information. Such factors, risks and
uncertainties include, among others: receipt of the approval of the
shareholders of Stronghold and the Toronto Stock Exchange for the
Stronghold acquisition as well as other applicable regulatory
approvals; that the Stronghold acquisition may not close within the
timeframe anticipated or at all or may not close on the terms and
conditions currently anticipated by the parties for a number of
reasons including, without limitation, as a result of a failure to
satisfy the conditions to closing of the Stronghold acquisition;
the construction and operation of new facilities may not occur as
currently planned, or at all; expansion of existing facilities may
not materialize as currently anticipated, or at all; new miners may
not perform up to expectations; revenue may not increase as
currently anticipated, or at all; the ongoing ability to
successfully mine digital currency is not assured; failure of the
equipment upgrades to be installed and operated as planned; the
availability of additional power may not occur as currently
planned, or at all; expansion may not materialize as currently
anticipated, or at all; the power purchase agreements and economics
thereof may not be as advantageous as expected; potential
environmental cost and regulatory penalties due to the operation of
the Stronghold plants which entail environmental risk and certain
additional risk factors particular to the business of Stronghold
including, land reclamation requirements may be burdensome and
expensive, changes in tax credits related to coal refuse power
generation could have a material adverse effect on the business,
financial condition, results of operations and future development
efforts, competition in power markets may have a material adverse
effect on the results of operations, cash flows and the market
value of the assets, the business is subject to substantial energy
regulation and may be adversely affected by legislative or
regulatory changes, as well as liability under, or any future
inability to comply with, existing or future energy regulations or
requirements, the operations are subject to a number of risks
arising out of the threat of climate change, and environmental
laws, energy transitions policies and initiatives and regulations
relating to emissions and coal residue management, which could
result in increased operating and capital costs and reduce the
extent of business activities, operation of power generation
facilities involves significant risks and hazards customary to the
power industry that could have a material adverse effect on our
revenues and results of operations, and there may not have adequate
insurance to cover these risks and hazards, employees, contractors,
customers and the general public may be exposed to a risk of injury
due to the nature of the operations, limited experience with carbon
capture programs and initiatives and dependence on third-parties,
including consultants, contractors and suppliers to develop and
advance carbon capture programs and initiatives, and failure to
properly manage these relationships, or the failure of these
consultants, contractors and suppliers to perform as expected,
could have a material adverse effect on the business, prospects or
operations; the digital currency market; the ability to
successfully mine digital currency; it may not be possible to
profitably liquidate the current digital currency inventory, or at
all; a decline in digital currency prices may have a significant
negative impact on operations; an increase in network difficulty
may have a significant negative impact on operations; the
volatility of digital currency prices; the anticipated growth and
sustainability of hydroelectricity for the purposes of
cryptocurrency mining in the applicable jurisdictions; the
inability to maintain reliable and economical sources of power to
operate cryptocurrency mining assets; the risks of an increase in
electricity costs, cost of natural gas, changes in currency
exchange rates, energy curtailment or regulatory changes in the
energy regimes in the jurisdictions in which Bitfarms and
Stronghold operate and the potential adverse impact on
profitability; future capital needs and the ability to complete
current and future financings, including Bitfarms’ ability to
utilize an at-the-market offering program ( “ATM Program”) and the
prices at which securities may be sold in such ATM Program, as well
as capital market conditions in general; share dilution resulting
from an ATM Program and from other equity issuances; volatile
securities markets impacting security pricing unrelated to
operating performance; the risk that a material weakness in
internal control over financial reporting could result in a
misstatement of financial position that may lead to a material
misstatement of the annual or interim consolidated financial
statements if not prevented or detected on a timely basis;
historical prices of digital currencies and the ability to mine
digital currencies that will be consistent with historical prices;
and the adoption or expansion of any regulation or law that will
prevent Bitfarms from operating its business, or make it more
costly to do so. For further information concerning these and other
risks and uncertainties, refer to Bitfarms’ filings on
www.sedarplus.ca (which are also available on the website of the
U.S. Securities and Exchange Commission (the “SEC") at
www.sec.gov), including the MD&A for the year-ended December
31, 2023, filed on March 7, 2024 and the MD&A for the three and
nine months ended September 30, 2024 filed on November 13, 2024,
and its registration statement on Form F-4 (File No. 333-282657)
filed by Bitfarms with the SEC (the “registration statement”),
which includes a proxy statement of Stronghold that also
constitutes a prospectus of Bitfarms (the “proxy
statement/prospectus”). Although Bitfarms has attempted to identify
important factors that could cause actual results to differ
materially from those expressed in forward-looking statements,
there may be other factors that cause results not to be as
anticipated, estimated or intended, including factors that are
currently unknown to or deemed immaterial by Bitfarms. There can be
no assurance that such statements will prove to be accurate as
actual results, and future events could differ materially from
those anticipated in such statements. Accordingly, readers should
not place undue reliance on any forward-looking information.
Bitfarms does not undertake any obligation to revise or update any
forward-looking information other than as required by law. Trading
in the securities of the Company should be considered highly
speculative. No stock exchange, securities commission or other
regulatory authority has approved or disapproved the information
contained herein. Neither the Toronto Stock Exchange, Nasdaq, or
any other securities exchange or regulatory authority accepts
responsibility for the adequacy or accuracy of this release.
Additional Information about the Merger
and Where to Find ItThis communication relates to a
proposed merger between Stronghold and Bitfarms. In connection with
the proposed merger, Bitfarms has filed the registration statement
with the SEC. After the registration statement is declared
effective, Stronghold will mail the proxy statement/prospectus to
its shareholders. This communication is not a substitute for the
registration statement, the proxy statement/prospectus or any other
relevant documents Bitfarms and Stronghold has filed or will file
with the SEC. Investors are urged to read the proxy
statement/prospectus (including all amendments and supplements
thereto) and other relevant documents filed with the SEC carefully
and in their entirety if and when they become available because
they will contain important information about the proposed merger
and related matters.
Investors may obtain free copies of the
registration statement, the proxy statement/prospectus and other
relevant documents filed by Bitfarms and Stronghold with the SEC,
when they become available, through the website maintained by the
SEC at www sec.gov. Copies of the documents may also be obtained
for free from Bitfarms by contacting Bitfarms' Investor Relations
Department at investors@bitfarms.com and from Stronghold by
contacting Stronghold's Investor Relations Department at
SDIG@gateway-grp.com.
No Offer or SolicitationThis
communication is not intended to and does not constitute an offer
to sell or the solicitation of an offer to buy, sell or solicit any
securities or any proxy, vote or approval, nor shall there be any
sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offer of securities shall be deemed to be made except by means
of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Participants in Solicitation Relating to
the Merger Bitfarms, Stronghold, their respective
directors and certain of their respective executive officers may be
deemed to be participants in the solicitation of proxies from
Stronghold's shareholders in respect of the proposed merger.
Information regarding Bitfarms’ directors and executive officers
can be found in Bitfarms’ annual information form for the year
ended December 31, 2023, filed on March 7, 2024, as well as its
other filings with the SEC. Information regarding Stronghold’s
directors and executive officers can be found in Stronghold’s proxy
statement for its 2024 annual meeting of stockholders, filed with
the SEC on April 29, 2024, and supplemented on June 7, 2024, and in
its Form 10-K for the year ended December 31, 2023, filed with the
SEC on March 8, 2024. This communication may be deemed to be
solicitation material in respect of the proposed merger. Additional
information regarding the interests of such potential participants,
including their respective interests by security holdings or
otherwise, is set forth in the proxy statement/prospectus and other
relevant documents filed with the SEC in connection with the
proposed merger if and when they become available. These documents
are available free of charge on the SEC’s website and from Bitfarms
and Stronghold using the sources indicated above.
Investor Relations
Contacts:
BitfarmsTracy KrummeSVP, Head of IR & Corp. Comms.+1
786-671-5638tkrumme@bitfarms.com
Media Contacts:
Québec: TactLouis-Martin Leclerc+1
418-693-2425lmleclerc@tactconseil.ca
|
|
|
Bitfarms Ltd. Consolidated Financial & Operational
Results |
|
|
|
|
|
Three months ended September 30, |
Nine months ended September 30, |
|
(U.S.$ in thousands except where indicated) |
|
2024 |
|
2023 (3) |
$ Change |
% Change |
2024 |
|
2023 (3) |
$ Change |
% Change |
|
Revenues |
|
44,853 |
|
34,596 |
|
10,257 |
|
30 |
% |
136,718 |
|
100,125 |
|
36,593 |
|
37 |
% |
|
Cost of revenues |
|
(56,642 |
) |
(43,462 |
) |
(13,180 |
) |
30 |
% |
(170,464 |
) |
(123,384 |
) |
(47,080 |
) |
38 |
% |
|
Gross loss |
|
(11,789 |
) |
(8,866 |
) |
(2,923 |
) |
33 |
% |
(33,746 |
) |
(23,259 |
) |
(10,487 |
) |
45 |
% |
|
Gross margin (1) |
|
(26 |
)% |
(26 |
)% |
— |
|
— |
|
(25 |
)% |
(23 |
)% |
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
| Operating
expenses |
|
|
|
|
|
|
|
|
|
|
General and administrative expenses |
|
(27,600 |
) |
(8,372 |
) |
(19,228 |
) |
230 |
% |
(53,198 |
) |
(25,887 |
) |
(27,311 |
) |
106 |
% |
|
(Revaluation loss) reversal of revaluation loss on digital
assets |
|
— |
|
(1,183 |
) |
1,183 |
|
100 |
% |
— |
|
1,512 |
|
(1,512 |
) |
(100 |
)% |
|
Loss on disposition of property, plant and equipment and
deposits |
|
(875 |
) |
(217 |
) |
(658 |
) |
303 |
% |
(606 |
) |
(1,776 |
) |
1,170 |
|
(66 |
)% |
|
Impairment on short-term prepaid deposits, property, plant and
equipment and assets held for sale |
|
(3,628 |
) |
— |
|
(3,628 |
) |
(100 |
)% |
(3,628 |
) |
(9,982 |
) |
6,354 |
|
(64 |
)% |
|
Operating loss |
|
(43,892 |
) |
(18,638 |
) |
(25,254 |
) |
135 |
% |
(91,178 |
) |
(59,392 |
) |
(31,786 |
) |
54 |
% |
|
Operating margin (1) |
|
(98 |
)% |
(54 |
)% |
— |
|
— |
|
(67 |
)% |
(59 |
)% |
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net financial income |
|
7,241 |
|
2,532 |
|
4,709 |
|
186 |
% |
17,367 |
|
12,492 |
|
4,875 |
|
39 |
% |
|
Net loss before income taxes |
|
(36,651 |
) |
(16,106 |
) |
(20,545 |
) |
128 |
% |
(73,811 |
) |
(46,900 |
) |
(26,911 |
) |
57 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Income tax (expense) recovery |
|
2 |
|
(401 |
) |
403 |
|
100 |
% |
4,583 |
|
23 |
|
4,560 |
|
nm |
|
|
Net loss |
|
(36,649 |
) |
(16,507 |
) |
(20,142 |
) |
122 |
% |
(69,228 |
) |
(46,877 |
) |
(22,351 |
) |
48 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per share (in U.S. dollars) |
|
(0.08 |
) |
(0.06 |
) |
— |
|
— |
|
(0.17 |
) |
(0.19 |
) |
— |
|
— |
|
|
Change in revaluation surplus - digital assets, net of tax |
|
721 |
|
(824 |
) |
1,545 |
|
188 |
% |
12,699 |
|
1,567 |
|
11,132 |
|
710 |
% |
|
Total comprehensive loss, net of tax |
|
(35,928 |
) |
(17,331 |
) |
(18,597 |
) |
107 |
% |
(56,529 |
) |
(45,310 |
) |
(11,219 |
) |
25 |
% |
|
|
|
|
|
|
|
|
|
|
|
| Gross Mining profit (2) |
|
16,699 |
|
14,527 |
|
2,172 |
|
15 |
% |
68,689 |
|
44,823 |
|
23,866 |
|
53 |
% |
| Gross Mining margin (2) |
|
38 |
% |
44 |
% |
— |
|
— |
|
52 |
% |
47 |
% |
— |
|
— |
|
| EBITDA (2) |
|
(9,836 |
) |
5,999 |
|
(15,835 |
) |
(264 |
)% |
38,563 |
|
18,633 |
|
19,930 |
|
107 |
% |
| EBITDA margin (2) |
|
(22 |
)% |
17 |
% |
— |
|
— |
|
28 |
% |
19 |
% |
— |
|
— |
|
| Adjusted EBITDA (2) |
|
6,352 |
|
8,883 |
|
(2,531 |
) |
(28 |
)% |
41,424 |
|
27,226 |
|
14,198 |
|
52 |
% |
|
Adjusted EBITDA margin (2) |
|
14 |
% |
26 |
% |
— |
|
— |
|
30 |
% |
27 |
% |
— |
|
— |
|
nm: not meaningful
|
|
|
|
1 |
Gross margin and Operating margin are supplemental financial
ratios; refer to Section 9 - Non-IFRS and Other Financial Measures
and Ratios of the Company's MD&A. |
|
2 |
Gross Mining profit, Gross Mining margin, EBITDA, EBITDA margin,
Adjusted EBITDA and Adjusted EBITDA margin are non-IFRS measures or
ratios; refer to Section 9 - Non-IFRS and Other Financial Measures
and Ratios of the Company's MD&A. |
|
3 |
Prior year figures are derived from restated financial statements.
Refer to the Q3 2024 interim financial statements Note 3d - Basis
of Presentation and Material Accounting Policy Information -
Restatement. |
|
|
|
|
|
|
Bitfarms Ltd. Reconciliation of Consolidated Net Income
(loss) to EBITDA and Adjusted EBITDA |
|
|
|
|
|
Three months ended September 30, |
Nine months ended September 30, |
|
(U.S.$ in thousands except where indicated) |
|
2024 |
|
2023 (1) |
|
$ Change |
|
% Change |
|
2024 |
|
2023 (1) |
|
$ Change |
|
% Change |
|
|
Revenues |
|
44,853 |
|
34,596 |
|
10,257 |
|
30 |
% |
136,718 |
|
100,125 |
|
36,593 |
|
37 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss before income taxes |
|
(36,651 |
) |
(16,106 |
) |
(20,545 |
) |
128 |
% |
(73,811 |
) |
(46,900 |
) |
(26,911 |
) |
57 |
% |
|
Interest (income) and expense |
|
(2,014 |
) |
338 |
|
(2,352 |
) |
(696 |
)% |
(4,009 |
) |
2,538 |
|
(6,547 |
) |
(258 |
)% |
| Depreciation and
amortization |
|
28,829 |
|
21,767 |
|
7,062 |
|
32 |
% |
125,143 |
|
62,995 |
|
62,148 |
|
99 |
% |
|
Sales tax recovery - depreciation and amortization |
|
— |
|
— |
|
— |
|
— |
% |
(8,760 |
) |
— |
|
(8,760 |
) |
100 |
% |
|
EBITDA |
|
(9,836 |
) |
5,999 |
|
(15,835 |
) |
(264 |
)% |
38,563 |
|
18,633 |
|
19,930 |
|
107 |
% |
|
EBITDA margin |
|
(22)% |
|
17 |
% |
— |
|
— |
|
28 |
% |
19 |
% |
— |
|
— |
|
|
Share-based payment |
|
5,159 |
|
2,011 |
|
3,148 |
|
157 |
% |
9,928 |
|
7,009 |
|
2,919 |
|
42 |
% |
| Impairment on short-term prepaid
deposits, property, plant and equipment and assets held for
sale |
|
3,628 |
|
— |
|
3,628 |
|
100 |
% |
3,628 |
|
9,982 |
|
(6,354 |
) |
(64 |
)% |
| Revaluation loss (reversal of
revaluation loss) on digital assets |
|
— |
|
1,183 |
|
(1,183 |
) |
100 |
% |
— |
|
(1,512 |
) |
1,512 |
|
100 |
% |
| Gain on extinguishment of
long-term debt and lease liabilities |
|
— |
|
— |
|
— |
|
— |
% |
— |
|
(12,835 |
) |
12,835 |
|
100 |
% |
| (Gain) loss revaluation of
warrants |
|
(5,704 |
) |
(2,196 |
) |
(3,508 |
) |
160 |
% |
(13,289 |
) |
214 |
|
(13,503 |
) |
nm |
|
| Gain on disposition of marketable
securities |
|
(780 |
) |
(4,120 |
) |
3,340 |
|
(81 |
)% |
(1,531 |
) |
(11,246 |
) |
9,715 |
|
(86 |
)% |
| Service fees not associated with
ongoing operations |
|
9,253 |
|
— |
|
9,253 |
|
100 |
% |
12,479 |
|
— |
|
12,479 |
|
100 |
% |
| Sales tax recovery - prior years
- energy and infrastructure and general and administrative expenses
(2) |
|
— |
|
2,366 |
|
(2,366 |
) |
100 |
% |
(16,081 |
) |
6,796 |
|
(22,877 |
) |
(337 |
)% |
|
Net financial expense and other |
|
4,632 |
|
3,640 |
|
992 |
|
27 |
% |
7,727 |
|
10,185 |
|
(2,458 |
) |
(24 |
)% |
|
Adjusted EBITDA |
|
6,352 |
|
8,883 |
|
(2,531 |
) |
(28 |
)% |
41,424 |
|
27,226 |
|
14,198 |
|
52 |
% |
|
Adjusted EBITDA margin |
|
14 |
% |
26 |
% |
— |
|
— |
|
30 |
% |
27 |
% |
— |
|
— |
|
nm: not meaningful
|
|
|
|
1 |
Prior year figures are derived from restated financial statements.
Refer to the Q2 2024 interim financial statements Note 3d - Basis
of Presentation and Material Accounting Policy Information -
Restatement. |
|
2 |
Sales tax recovery relating to energy and infrastructure and
general and administrative expenses have been allocated to their
respective periods; refer to the Q3 2024 interim financial
statements Note 23b - Additional Details to the Statement of Profit
or Loss and Comprehensive Profit or Loss (Canadian sales tax
refund). |
|
|
|
|
|
|
Bitfarms Ltd. Calculation of Gross Mining
Profit and Gross Mining Margin |
|
|
|
|
|
Three months ended September 30, |
Nine months ended September 30, |
|
(U.S.$ in thousands except where indicated) |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
|
Gross loss |
|
(11,789 |
) |
(8,866 |
) |
(2,923 |
) |
33 |
% |
(33,746 |
) |
(23,259 |
) |
(10,487 |
) |
45 |
% |
|
Non-Mining revenues¹ |
|
(1,451 |
) |
(1,697 |
) |
246 |
|
(14 |
)% |
(3,510 |
) |
(3,775 |
) |
265 |
|
(7 |
)% |
| Depreciation and
amortization |
|
28,829 |
|
21,767 |
|
7,062 |
|
32 |
% |
125,143 |
|
62,995 |
|
62,148 |
|
99 |
% |
| Sales tax recovery - depreciation
and amortization |
|
— |
|
— |
|
— |
|
— |
% |
(8,760 |
) |
— |
|
(8,760 |
) |
(100 |
)% |
| Electrical components and
salaries |
|
1,097 |
|
1,299 |
|
(202 |
) |
(16 |
)% |
2,678 |
|
3,050 |
|
(372 |
) |
(12 |
)% |
| Sales tax recovery - prior years
- energy and infrastructure² |
|
— |
|
2,138 |
|
(2,138 |
) |
100 |
% |
(14,338 |
) |
6,155 |
|
(20,493 |
) |
(333 |
)% |
|
Other |
|
13 |
|
(114 |
) |
127 |
|
nm |
|
1,222 |
|
(343 |
) |
1,565 |
|
nm |
|
|
Gross Mining profit |
|
16,699 |
|
14,527 |
|
2,172 |
|
15 |
% |
68,689 |
|
44,823 |
|
23,866 |
|
53 |
% |
|
Gross Mining margin |
|
38 |
% |
44 |
% |
— |
|
— |
|
52 |
% |
47 |
% |
— |
|
— |
|
nm: not meaningful
|
(1) |
Non-Mining revenues reconciliation: |
|
|
|
Three months ended September 30, |
Nine months ended September 30, |
|
(U.S.$ in thousands except where indicated) |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
|
Revenues |
|
44,853 |
|
34,596 |
|
10,257 |
|
30 |
% |
136,718 |
|
100,125 |
|
36,593 |
|
37 |
% |
|
Less Mining related revenues for the purpose of calculating gross
Mining margin: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mining revenues³ |
|
(43,402 |
) |
(32,899 |
) |
(10,503 |
) |
32 |
% |
(133,208 |
) |
(96,350 |
) |
(36,858 |
) |
38 |
% |
|
Non-Mining revenues |
|
1,451 |
|
1,697 |
|
(246 |
) |
(14 |
)% |
3,510 |
|
3,775 |
|
(265 |
) |
(7 |
)% |
|
(2) |
Sales tax recovery relating to energy and infrastructure expenses
has been allocated to their respective periods; refer to Q3 2024
interim financial statements Note 23b - Additional Details to the
Statement of Profit or Loss and Comprehensive Profit or Loss
(Canadian sales tax refund). |
|
(3) |
Mining revenues include Revenues from sale of computational power
used for hashing calculations and Revenue from computational power
sold in exchange of services. |
|
|
|
|
Bitfarms Ltd. Calculation of Direct Cost and Direct Cost
per BTC |
| |
|
|
|
Three months ended September 30, |
Nine months ended September 30, |
|
(U.S.$ in thousands except where indicated) |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
|
Cost of revenues |
|
56,642 |
|
43,462 |
|
13,180 |
|
30 |
% |
170,464 |
|
123,384 |
|
47,080 |
|
38 |
% |
|
Depreciation and amortization |
|
(28,829 |
) |
(21,767 |
) |
(7,062 |
) |
32 |
% |
(125,143 |
) |
(62,995 |
) |
(62,148 |
) |
99 |
% |
| Sales tax recovery - depreciation
and amortization |
|
— |
|
— |
|
— |
|
— |
% |
8,760 |
|
— |
|
8,760 |
|
100 |
% |
| Electrical components and
salaries |
|
(1,097 |
) |
(1,299 |
) |
202 |
|
(16 |
)% |
(2,678 |
) |
(3,050 |
) |
372 |
|
(12 |
)% |
| Infrastructure |
|
(1,432 |
) |
(600 |
) |
(832 |
) |
139 |
% |
(4,328 |
) |
(2,303 |
) |
(2,025 |
) |
88 |
% |
| Sales tax recovery - prior years
- energy and infrastructure (1) |
|
— |
|
(2,138 |
) |
2,138 |
|
(100 |
)% |
14,338 |
|
(6,155 |
) |
20,493 |
|
(333 |
)% |
|
Other |
|
— |
|
— |
|
— |
|
— |
% |
— |
|
82 |
|
(82 |
) |
(100 |
)% |
|
Direct Cost |
|
25,284 |
|
17,658 |
|
7,626 |
|
43 |
% |
61,413 |
|
48,963 |
|
12,450 |
|
25 |
% |
|
Quantity of BTC earned |
|
703 |
|
1,172 |
|
(469 |
) |
(40 |
)% |
2,260 |
|
3,692 |
|
(1,432 |
) |
(39 |
)% |
|
Direct Cost per BTC (in U.S. dollars) |
|
36,000 |
|
15,100 |
|
20,900 |
|
138 |
% |
27,200 |
|
13,300 |
|
13,900 |
|
105 |
% |
nm: not meaningful
|
|
|
Bitfarms Ltd. Calculation of Total Cash Cost and Total Cost
per BTC |
|
|
|
|
|
Three months ended September 30, |
Nine months ended September 30, |
|
(U.S.$ in thousands except where indicated) |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
|
|
Cost of revenues |
|
56,642 |
|
43,462 |
|
13,180 |
|
30 |
% |
170,464 |
|
123,384 |
|
47,080 |
|
38 |
% |
|
General and administrative expenses |
|
27,600 |
|
8,372 |
|
19,228 |
|
230 |
% |
53,198 |
|
25,887 |
|
27,311 |
|
106 |
% |
|
|
|
84,242 |
|
51,834 |
|
32,408 |
|
63 |
% |
223,662 |
|
149,271 |
|
74,391 |
|
50 |
% |
| Depreciation and
amortization |
|
(28,829 |
) |
(21,767 |
) |
(7,062 |
) |
32 |
% |
(125,143 |
) |
(62,995 |
) |
(62,148 |
) |
99 |
% |
| Non-cash service expense (2) |
|
(564 |
) |
— |
|
(564 |
) |
100 |
% |
(564 |
) |
— |
|
(564 |
) |
100 |
% |
| Sales tax recovery - depreciation
and amortization |
|
— |
|
— |
|
— |
|
— |
% |
8,760 |
|
— |
|
8,760 |
|
100 |
% |
| Electrical components and
salaries |
|
(1,097 |
) |
(1,299 |
) |
202 |
|
(16 |
)% |
(2,678 |
) |
(3,050 |
) |
372 |
|
(12 |
)% |
| Share-based payment |
|
(5,159 |
) |
(2,011 |
) |
(3,148 |
) |
157 |
% |
(9,928 |
) |
(7,009 |
) |
(2,919 |
) |
42 |
% |
| Service fees not associated with
ongoing operations |
|
(9,253 |
) |
— |
|
(9,253 |
) |
100 |
% |
(12,479 |
) |
— |
|
(12,479 |
) |
100 |
% |
| Sales tax recovery - prior years
- energy and infrastructure and general and administrative expenses
(1) |
|
— |
|
(2,366 |
) |
2,366 |
|
100 |
% |
16,081 |
|
(6,796 |
) |
22,877 |
|
nm |
|
|
Other |
|
(2,500 |
) |
23 |
|
(2,523 |
) |
nm |
|
(5,659 |
) |
510 |
|
(6,169 |
) |
nm |
|
|
Total Cash Cost |
|
36,840 |
|
24,414 |
|
12,426 |
|
51 |
% |
92,052 |
|
69,931 |
|
22,121 |
|
32 |
% |
|
Quantity of BTC earned |
|
703 |
|
1,172 |
|
(469 |
) |
(40 |
)% |
2,260 |
|
3,692 |
|
(1,432 |
) |
(39 |
)% |
|
Total Cash Cost per BTC (in U.S. dollars) |
|
52,400 |
|
20,800 |
|
31,600 |
|
152 |
% |
40,700 |
|
18,900 |
|
21,800 |
|
115 |
% |
nm: not meaningful
|
|
|
|
1 |
Sales tax recovery relating to energy and infrastructure and
general and administrative expenses have been allocated to their
respective periods; refer to Q3 2024 interim financial statements
Note 23b - Additional Details to the Statement of Profit or Loss
and Comprehensive Profit or Loss (Canadian sales tax refund). |
|
2 |
Non-cash service expense, included in infrastructure, which was
exchanged for computational power sold. |
Bitfarms (NASDAQ:BITF)
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