Argo Blockchain PLC (LSE:ARB, OTCQX:ARBKF, NASDAQ:ARBK, ETR:0XP) mined 2,156 bitcoin or bitcoin equivalent (BTC) during the 2022 financial year, a 5% increase compared to 2021, per the London-listed company’s Friday earnings call.
Mining operations generated £47.4mln (US$58.6mln) in revenue, a decrease of 36% from 2021 due to the bitcoin bear market, an increase in global hashrate and network difficulty level, and surging energy costs.
Adjusted EBITDA of £1mln was down from £55mln in 2021, while margins decreased to 54% from 84%, with net losses reaching £194.2mln.
Argo held a total of 141 bitcoin as of 31 December 2022, amounting to approximately £2.34mln at the time, or £4.2mln as of 28 April.
In terms of operational highlights, Argo increased hashrate capacity by 55%, from 1.6 EH/s at the end of 2021 to 2.5 EH/s at the end of 2022.
Other operational highlights saw Argo sign an agreement with ePIC Blockchain Technologies to purchase 2,870 BlockMiner machines to be deployed in the third quarter of 2023, as well as completing a swap agreement with Core Scientific for S19J Pro machines representing around 970 PH/s, ending the hosting agreement with Core in place of self-mining operations at Helios.
On 29 December, Argo Blockchain completed a series of agreements with Galaxy Digital (TSX-V:GLXY) Holdings Ltd. to sell its Helios facility for £53mln, and to refinance existing equipment financing loans with a new asset-backed loan from Galaxy for £28mln.
Argo maintained ownership of its entire fleet of mining machines and Galaxy is now hosting approximately 23,619 Bitmain S19J Pro machines at Helios under a two-year hosting agreement.
Total debt, net of cash, as of 31 December was approximately £46mln.
Interim chief executive Seif El-Bakly said: "Having navigated challenging market conditions in both the crypto sector and the global economy in the second half of 2022, Argo has emerged stronger and in a much more solid financial position.
“Following the build of Helios and the strategic transaction with Galaxy, we have streamlined our operations to maximize efficiency and increase our hashrate while maintaining our mining capacity thanks to our Hosting Agreement.
“On the basis of these foundations, we continue to work diligently on the next stage of Argo's growth and development, with the goal of delivering long-term value to our shareholders."
Going forward, Argo intends to focus on improving operational efficiency at its Quebec facilities by optimising its mining fleet and utilising excess capacity at these sites.
The new BlockMiner machines, representing an incremental 300 PH/s of hashrate capacity, will be deployed at the group's Quebec facilities.
First-quarter update
The first quarter of 2023 saw 491 BTC mined (an average of 5.5 BTC per day), marking a 5% increase year on year, but an 8% decrease quarter on quarter.
Revenues came to £9mln with an improved 45-50% mining margin, increased from approximately 35% in the previous quarter due to higher Bitcoin prices and lower electricity prices in Texas.