Bitfarms Reports Financial Results for the Year Ended December 31, 2019

TORONTO & BROSSARD, Québec — Bitfarms Ltd. (“Bitfarms”, or the “Firm”) (TSXV:BITF) in the present day introduced its consolidated outcomes for the yr ended December 31, 2019.

2019 Monetary Abstract and Company Highlights

Consolidated income of US$32.Four million, gross revenue of US$11.Four million (35% gross revenue margin) and web revenue of US$2.1 million in 2019 in comparison with US$33.Eight million, US$10.9M (32% gross revenue margin), and a web lack of US$18.2 million, respectively, in 2018;
Mining operations section gross mining revenue¹ of US$17.7 million (60% gross mining margin) in 2019 in comparison with $23.2M (73% gross mining margin) in 2018;
US$9.6 million EBITDA¹ (30% EBITDA margin) and US$10.6 million Adjusted EBITDA¹ (33% Adjusted EBITDA margin) in 2019 in comparison with an EBITDA lack of US$5.6M (-16% EBITDA margin) and Adjusted EBITDA of US$15.Three million (45% Adjusted EBITDA margin) in 2018;
Mined 3,865 Bitcoin and seven,561 Litecoin² with a 2019 common break-even³ Bitcoin worth of US$2,996 and common break-even Litecoin Worth of US$49; and
Accomplished US$20.Zero million debt financing and absolutely deployed funds to extend infrastructure capability from 34 MW to 64 MW (88% improve) and improve hashrate to roughly 780 PH (~270% improve) by the tip of 2019.

“Regardless of a difficult begin to the yr on account of decrease Bitcoin costs, the Firm efficiently raised US$20 million of financing in Q1 2019. The capital raised was rapidly deployed to extend our datacentre infrastructure capability from 34 MW to 64 MW and spend money on mining tools at aggressive market costs to develop our computing energy to over 780 PH by the tip of the yr. The elevated scale of operations and the addition of latest, extra environment friendly mining tools allowed the Firm to attain a wholesome total gross mining margin of 60%, earn US$10.6 million of Adjusted EBITDA, and finish the yr profitably with web revenue of US$2.1M” commented John Rim, Chief Monetary Officer.

Emiliano Grodzki, Chief Govt Officer of Bitfarms added, “2019 was a transformative yr for Bitfarms with many important milestones. Along with the numerous operational progress achieved in 2019, we efficiently accomplished our itemizing on the TSXV via a full prospectus course of and the Firm is now already positioned as one of many largest and best public crypto mining operations on the earth. We’re more than happy to have had a worthwhile yr with fundamental and absolutely diluted earnings per share of $0.04. Lastly, we sit up for persevering with to execute our progress technique by constructing and operationalizing our remaining pipeline of accessible energy in Quebec within the close to to medium time period.”

Monetary Assessment

Consolidated Firm Outcomes (000’s)

(U.S.$ in hundreds besides the place indicated)	Three months ended				Twelve months ended
For the intervals ended as indicated	Dec. 31 2019	Dec. 31 2018	$ Change	% Change	Dec. 31 2019	Dec. 31 2018	$ Change	% Change
Revenues	10,536	4,654	5,882	126%	32,421	33,805	(1,384)	(4%)
Price of Gross sales	7,702	6,872	830	12%	20,982	22,928	(1,946)	(8%)
Gross revenue	2,834	(2,218)	5,052	(228%)	11,439	10,877	562	5%
Gross margin	27%	(48%)	–	–	35%	32%	–	–
G&A and different bills	2,712	1,712	1,000	58%	10,294	9,815	479	5%
Impairment of PP&E and Intangibles	–	19,060	(19,060)	(100%)	56	19,060	(19,004)	(100%)
Working revenue (loss)	122	(22,990)	23,112	(101%)	1,089	(17,998)	19,087	(106%)
Working margin	1%	(494%)	–	–	3%	(53%)	–	–
Monetary revenue	55	–	55	100%	2,252	–	2,252	100%
Curiosity expense (revenue)	1,122	(58)	1,180	(2,034%)	3,268	63	3,205	5,087%
Different monetary bills (revenue)	504	63	441	700%	557	116	441	380%
Complete Monetary bills	1,626	5	1,621	32,420%	3,825	179	3,646	2,037%
Pre-tax loss	(1,449)	(22,995)	21,546	(94%)	(484)	(18,177)	17,693	(97%)
Revenue tax expense (restoration)	(2,574)	(1,732)	(842)	49%	(2,591)	59	(2,650)	(4,492%)
Internet revenue (loss)	1,125	(21,263)	22,388	(105%)	2,107	(18,236)	20,343	(112%)
Internet revenue (loss) per share – fundamental	0.02	(0.02)	0.04	(200%)	0.04	(0.16)	0.20	(127%)
Gross mining revenue ⁽¹⁾	5,488	1,676	3,812	227%	17,681	23,154	(5,473)	(24%)
Gross mining margin ⁽¹⁾	56%	45%	–	–	60%	73%	–	–
EBITDA⁽¹⁾	2,299	(19,839)	22,138	(112%)	9,627	(5,566)	15,193	(273%)
EBITDA margin ⁽¹⁾	22%	(426%)	–	–	30%	(16%)	–	–
Adjusted EBITDA ⁽¹⁾	2,986	(603)	3,589	(595%)	10,617	15,265	(4,648)	(30%)
Adjusted EBITDA margin ⁽¹⁾	28%	(13%)	–	–	33%	45%	–	–

Notes

(1) EBITDA, EBITDA margin, Adjusted EBITDA, Adjusted EBITDA margin, Gross mining revenue and Gross mining margin are non-IFRS efficiency measures; please discuss with Non-IFRS Efficiency Measures.

Income

Bitfarms’ whole income for 2019 was US$32.Four million in comparison with US$33.Eight million in 2018. Income in 2019 decreased US$1.Four million or 4% in 2019 in comparison with 2018 on account of a lower of altcoins bought (i.e. Bitcoin Money, Ether, and Litecoin) in addition to a lower within the common promoting worth of Bitcoin in 2019 in comparison with 2018 ($7,412 in 2019 in comparison with $7,904 in 2018) offset by a rise in Bitcoin mined, ensuing from greater Bitfarms’ common elevated hashrate in extra of the typical Community Problem, and a rise in Volta third social gathering income in 2019 in comparison with 2018.

Price of Gross sales

Bitfarms’ price of gross sales for 2019 was US$21.Zero million in comparison with US$22.9 million in 2018. Prices of gross sales embrace power and infrastructure bills, rental expense, depreciation and amortization, electrician salaries, and purchases and web change in stock.

Power and infrastructure bills elevated by US$3.2 million or 37% in 2019 in comparison with 2018 because the Firm added new mining tools that elevated electrical consumption from 22 MW on the finish of 2018 to roughly 53 MW by the tip of 2019. Depreciation and amortization expense decreased by US$5.7 million or 45% in 2019 in comparison with 2018 primarily as a result of impairment of US$18.5 million on property, plant and tools and intangible belongings recorded by the Firm in 2018. The lower was partially offset by a rise in depreciation and amortization expense of US$854,000 in 2019 in comparison with 2018 ensuing from the adoption of IFRS 16 by the Firm in January 2019 because the Firm amortizes proper of use belongings over the time period of the related leases.

Gross Revenue

In 2019, the Firm had consolidated gross revenue of US$11.Four million (35% gross margin) on consolidated income of US$32.Four million, in comparison with gross revenue of US$10.9 million (32% gross margin) on consolidated income of US$33.Eight million in 2018.

Basic & Administrative and Different Bills

Bitfarms’ basic and administrative and different bills elevated US$0.5 million or 5% in 2019 in comparison with 2018. The rise was primarily on account of greater non-cash wage bills associated to share-based compensation (US$2.9 million in 2019 versus US$0.Eight million in 2018) as new worker inventory choices have been authorized and granted in 2019. The rise was primarily offset by a lower of US$1.6 million in different basic and administrative bills together with itemizing charges, skilled charges, and promoting and promotion in 2019 in comparison with 2018.

Monetary Revenue and Bills

Bitfarms’ monetary revenue for 2019 was US$2.Three million in comparison with monetary revenue of US$Zero in 2018 ensuing primarily from the revaluation of warrants and embedded spinoff creating non-cash features of US$1.Eight million and US$0.5 million, respectively, in reference to the Dominion Capital mortgage.

Monetary bills for 2019 have been US$3.Eight million in comparison with US$0.2 million in 2018. The rise is primarily associated to prices related to the Dominion Capital mortgage that didn’t exist in 2018. These bills embrace curiosity on the Dominion Capital mortgage of US$2.Eight million and warrant issuance prices of US$0.2 million. Monetary bills in 2019 additionally embrace curiosity expense on lease liabilities recorded on adoption of IFRS 16 within the quantity of US$0.Four million, and US$0.2 million of unrealized international alternate losses.

Reconciliation of Internet Revenue to EBITDA and Adjusted EBITDA

(U.S.$ in hundreds besides the place indicated)	Three months ended				Twelve months ended
For the intervals ended as indicated	Dec. 31 2019	Dec. 31 2018	$ Change	% Change	Dec. 31 2019	Dec. 31 2018	$ Change	% Change
Internet revenue (loss)	1,125	(21,263)	22,388	(105%)	2,107	(18,236)	20,343	(112%)
Curiosity expense	1,122	(58)	1,180	(2,034%)	3,268	63	3,205	5,087%
Revenue tax expense (restoration)	(2,574)	(1,732)	(842)	49%	(2,591)	59	(2,650)	(4,492%)
Depreciation/amortization	2,626	3,214	(588)	(18%)	6,843	12,548	(5,705)	(45%)
EBITDA	2,299	(19,839)	22,138	(112%)	9,627	(5,566)	15,193	(273%)
Inventory compensation expense	430	165	265	161%	2,873	746	2,127	285%
Monetary revenue	(55)	–	(55)	–	(2,252)	–	(2,252)	–
Itemizing price	–	–	–	–	–	1,000	(1,000)	(100%)
Impairment	–	19,060	(19,060)	(100%)	56	19,060	(19,004)	(100%)
Different non-cash bills	312	11	301	2,736%	313	25	288	1,152%
Adjusted EBITDA	2,986	(603)	3,589	(595%)	10,617	15,265	(4,648)	(30%)

Bitfarms’ web revenue for 2019 was US$2.1 million in comparison with a web lack of US$18.2 million for 2018. Bitfarms’ revenue tax restoration for 2019 was US$2.6 million in comparison with an revenue tax expense of US$59,000 for 2018. EBITDA and Adjusted EBITDA for 2019 have been US$9.6 million and US$10.6 million , respectively, in comparison with an EBITDA lack of US$5.6 million and Adjusted EBITDA of US$15.Three million in 2018. EBITDA and Adjusted EBITDA are non-IFRS efficiency measures; please discuss with the heading “Non-IFRS Efficiency Measures” on the finish of this press launch.

Calculation of Gross Mining Revenue & Gross Mining Margin

(U.S. $ in hundreds besides the place indicated)	Three months ended				Twelve months ended
For the intervals ended as indicated	Dec. 31 2019	Dec. 31 2018	$ Change	% Change	Dec. 31 2019	Dec. 31 2018	$ Change	% Change
Revenues	9,717	3,752	5,965	159%	29,347	31,641	(2,294)	(7%)
Power and infrastructure bills	4,229	2,076	2,153	104%	11,666	8,487	3,179	37%
Gross mining revenue	5,488	1,676	3,812	227%	17,681	23,154	(5,473)	(24%)
Gross mining margin	56%	45%	–	–	60%	73%	–	–

Webcast

The Firm will likely be internet hosting a webcast presentation at 10:00 AM EDT on Wednesday April 29, 2020. To view the webcast presentation, please register at:

‘Kaspa Killer’ Rises: BlockDAG Gains Momentum from Moon Keynote 2 Drawing Interest from Polygon & Litecoin Investors

June 13, 2024

BDAG’s Spectacular Rise Following Keynote 2 Amid Polygon & Litecoin Insights

June 13, 2024

https://onlinexperiences.com/Launch/QReg/ShowUUID=5A867099-4608-42CB-A1F4-23B9E0732B36

The monetary outcomes and presentation may even be obtainable on our web site at www.bitfarms.com

About Bitfarms Ltd.

The Firm owns and operates computing centres that energy the worldwide decentralized monetary financial system. Bitfarms gives computing energy to cryptocurrency networks corresponding to Bitcoin, incomes charges from every community for securing and processing transactions. Powered by clear and competitively priced hydroelectricity, Bitfarms operates 5 computing centres in Québec, Canada. Bitfarms’ skilled administration group contains industrial-scale knowledge centre operators and capital markets professionals, targeted on constructing infrastructure for the longer term by growing and internet hosting the ecosystem rising round blockchain-based applied sciences.

To be taught extra about Bitfarms’ occasions, developments and on-line communities:

https://www.facebook.com/bitfarms/
https://twitter.com/Bitfarms_io
https://www.instagram.com/bitfarms/
https://www.linkedin.com/company/bitfarms/
Web site: www.bitfarms.io

Cautionary Assertion

Buying and selling within the securities of the Firm must be thought of extremely speculative. No inventory alternate, securities fee or different regulatory authority has authorized or disapproved the data contained herein. Neither the TSX Enterprise Change nor its Regulation Companies Supplier (as that time period is outlined within the insurance policies of the TSX Enterprise Change) accepts duty for the adequacy or accuracy of this launch.

Ahead-Wanting Statements

This information launch accommodates sure “forward-looking data” inside the that means of relevant Canadian securities legal guidelines which might be based mostly on expectations, estimates and projections as on the date of this information launch. The knowledge on this launch about future plans and targets of the Firm, are forward-looking data. Different forward-looking data contains however is just not restricted to data regarding: the intentions, plans and future actions of the Firm, in addition to Bitfarms’ capacity to efficiently mine digital foreign money, income growing as presently anticipated, the flexibility to profitably liquidate present and future digital foreign money stock, volatility of community problem and digital foreign money costs and the ensuing important detrimental influence on the Firm’s operations, the development and operation of expanded blockchain infrastructure as presently deliberate, and the regulatory surroundings of cryptocurrency within the Provinces of Canada.

Any statements that contain discussions with respect to predictions, expectations, beliefs, plans, projections, targets, assumptions, future occasions or efficiency (usually however not at all times utilizing phrases corresponding to “expects”, or “doesn’t anticipate”, “is predicted”, “anticipates” or “doesn’t anticipate”, “plans”, “funds”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such phrases and phrases or stating that sure actions, occasions or outcomes “might” or “may”, “would”, “would possibly” or “will” be taken to happen or be achieved) should not statements of historic truth and could also be forward-looking data and are meant to determine forward-looking data.

This forward-looking data relies on affordable assumptions and estimates of administration of the Firm on the time it was made, and entails identified and unknown dangers, uncertainties and different elements which can trigger the precise outcomes, efficiency or achievements of the Firm to be materially completely different from any future outcomes, efficiency or achievements expressed or implied by such forward-looking data. Such elements embrace, amongst others, dangers regarding the worldwide financial local weather; dilution; the Firm’s restricted working historical past; future capital wants and uncertainty of extra financing; the aggressive nature of the business; foreign money alternate dangers; the necessity for the Firm to handle its deliberate progress and growth; the consequences of product growth and wish for continued expertise change; safety of proprietary rights; the impact of presidency regulation and compliance on the Firm and the business; community safety dangers; the flexibility of the Firm to take care of correctly working techniques; reliance on key personnel; international financial and monetary market deterioration impeding entry to capital or growing the price of capital; and risky securities markets impacting safety pricing unrelated to working efficiency. As well as, specific elements which may influence future outcomes of the enterprise of Bitfarms embrace however should not restricted to: the development and operation of blockchain infrastructure might not happen as presently deliberate, or in any respect; growth might not materialize as presently anticipated, or in any respect; the digital foreign money market; the flexibility to efficiently mine digital foreign money; income might not improve as presently anticipated, or in any respect; it is probably not attainable to profitably liquidate the present digital foreign money stock, or in any respect; a decline in digital foreign money costs might have a big detrimental influence on operations; a rise in community problem might have a big detrimental influence on operations; the volatility of digital foreign money costs; the anticipated progress and sustainability of hydroelectricity for the needs of cryptocurrency mining within the Province of Québec, the flexibility to finish present and future financings, any laws or legal guidelines that can forestall Bitfarms from working its enterprise; historic costs of digital currencies and the flexibility to mine digital currencies that will likely be per historic costs; and there will likely be no regulation or legislation that can forestall Bitfarms from working its enterprise. The Firm has additionally assumed that no important occasions happen exterior of the Bitfarms’ regular course of enterprise. Though the Firm has tried to determine essential elements that might trigger precise outcomes to vary materially, there could also be different elements that trigger outcomes to not be as anticipated, estimated or meant. There may be no assurance that such statements will show to be correct as precise outcomes and future occasions may differ materially from these anticipated in such statements. Accordingly, readers shouldn’t place undue reliance on forward-looking data. The Firm undertakes no obligation to revise or replace any forward-looking data apart from as required by legislation.

Non-IFRS Efficiency Measures

This press launch makes reference to sure measures that aren’t acknowledged beneath IFRS and don’t have a standardized that means prescribed by IFRS. They’re due to this fact unlikely to be akin to related measures introduced by different corporations. The Firm makes use of non-IFRS measures together with “EBITDA,” “EBITDA margin,” “Adjusted EBITDA,” “Adjusted EBITDA margin,” “Gross mining revenue,” and “Gross mining margin” as extra data to enrich IFRS measures by offering additional understanding of the Firm’s outcomes of operations from administration’s perspective.

EBITDA and EBITDA margin are frequent measures used to evaluate profitability earlier than the influence of various financing strategies, revenue taxes, depreciation of capital belongings and amortization of intangible belongings. Adjusted EBITDA and Adjusted EBITDA margin are measures used to evaluate profitability earlier than the influence of all the gadgets in calculating EBITDA along with sure different non-cash bills. Gross mining revenue and Gross mining margin are measures used to evaluate profitability after energy prices in cryptocurrency manufacturing, the most important variable expense in mining. Administration makes use of non-IFRS measures so as to facilitate working efficiency comparisons from interval to interval and to organize annual working budgets.

“EBITDA” is outlined as web revenue (loss) earlier than: (i) curiosity expense; (ii) revenue tax expense; and (iii) depreciation and amortization. “EBITDA margin” is outlined as the proportion obtained when dividing EBITDA by Income. “Adjusted EBITDA” is outlined as EBITDA adjusted to exclude: (i) share-based compensation; (ii) non-cash finance bills; (iii) asset impairment costs; and (iv) different non-cash bills. “Adjusted EBITDA margin” is outlined as the proportion obtained when dividing Adjusted EBITDA by Income. “Gross mining revenue” is outlined as Income minus power bills for the Bitfarms section of the Firm. “Gross mining margin” is outlined as the proportion obtained when dividing Gross mining revenue by Income for the Bitfarms section of the Firm.

These measures are offered as extra data to enrich IFRS measures by offering additional understanding of the Firm’s outcomes of operations from administration’s perspective. Accordingly, they shouldn’t be thought of in isolation nor as an alternative choice to evaluation of the Firm’s monetary data reported beneath IFRS. See “Reconciliation of Internet Revenue to EBITDA and Adjusted EBITDA” for reconciliation of EBITDA and Adjusted EBITDA to web revenue.

¹ EBITDA, EBITDA margin, Adjusted EBITDA, Adjusted EBITDA margin, Gross mining revenue and Gross mining margin are non-IFRS efficiency measures; please discuss with the tip of this press launch concerning the usage of Non-IFRS Efficiency Measures.
² The corporate mined Litecoin at various ranges from January 2019 to August 2019.
³ Represents the break-even price of Bitcoin and Litecoin based mostly on variable price of electrical energy and is calculated by taking the overall electrical energy prices associated to the Mining of every of Bitcoin and Litecoin divided by the overall variety of Bitcoin and Litecoin mined, respectively, within the related interval.