CASTLE ROCK, Colo.,
Aug. 10, 2020 /PRNewswire/ -- Riot
Blockchain, Inc. (NASDAQ: RIOT) ("Riot" or the
"Company"), one of the few Nasdaq listed public cryptocurrency
mining companies in the United States, reported financial
results for the quarter and year to date periods ended June 30, 2020. The financial statements are
available on Riot's website and here.
Riot continues to make substantial progress. During the period
ended June 30, 2020, Riot announced
that its Bitcoin mining capacity would increase by 129% over its
first quarter 2020 hash rate to 566 PH/s by the fourth quarter of
2020, pending the receipt and deployment of additional miners which
have been purchased. Riot also relocated its entire mining
operation to a lower-cost facility during the second quarter and
oversaw the termination of the SEC investigation as announced
during the first quarter.
Despite experiencing downtime associated with the move to a
lower-cost facility and the Bitcoin halving event that occurred in
May 2020, Riot's revenues for the
six-month period ended June 30, 2020
increased by 11% as compared to the same six-month period in 2019.
SG&A expenses excluding stock-based compensation also decreased
by 29%. In addition, the Company's working capital, liquidity and
total stockholders' equity positions all continued to improve as
compared to the beginning of 2020.
Recent Operational Highlights
- Purchased 3,040 next-generation Bitmain S19 and S19 Pro
Antminers in the second quarter of 2020, which are expected to
increase the Company's current aggregate operating hash rate by
129% to approximately 566 PH/s, pending the receipt and deployment
of the additional new miners during the third and fourth quarters
of 2020. To date, a total of 1,432 next-generation S19s have been
received and deployed, with additional batches expected in August
and October.
- During April 2020, Riot entered
into a co-location mining agreement with Coinmint, which is
expected to improve the Company's operational efficiencies, and
completed the relocation and deployment of 5,040 miners to
Coinmint's facility in Massena, New
York.
- The Oklahoma mining facility
was closed, and the lease terminated as of June 30, 2020.
Recent Financial Highlights
- Produced 508 newly minted bitcoins (BTC) during the six-month
period ended June 30, 2020, despite
experiencing downtime associated with relocating to Coinmint's
facility in the second quarter of 2020 and the Bitcoin halving
event that occurred in May 2020.
- As of June 30, 2020, improved
working capital to $15.9 million from
$9.3 million as of December 31, 2019 and decreased total liabilities
to $2.1 million from $4.1 million during the same period.
- As of June 30, 2020, increased
total stockholders' equity to $27.8
million from $26.2 million at
December 31, 2019.
- As of June 30, 2020, invested
$7 million in next-generation miners
that will be received in the second half of 2020.
June 30, 2020 financial
results
For the six-month period ended June 30,
2020, cryptocurrency mining revenues increased to
$4.3 million as compared to
$3.8 million in the same six-month
period in 2019. Mining revenues decreased to $1.9 million in the three-month period ended
June 30, 2020, as compared to
$2.4 million in the same three-month
period in 2019. Revenue changes were impacted by downtime
associated with the Q2 2020 relocation of all mining operations
from the Oklahoma City facility to
Coinmint's lower-cost facility, increases in the difficulty index
associated with solving mining algorithms, as well as the halving
event that occurred on May 11,
2020.
For the six-month period ended June 30,
2020, mining revenue margin improved to 33.5% as compared to
20.5% during the same six-month period in 2019. Mining margin
revenue is computed as mining revenues in excess of cost of
revenues (excluding depreciation and amortization which is
separately stated).
Selling, general, and administrative ("SG&A") expenses
totaled $6.0 million in the six
months ended June 30, 2020, as
compared to $5.4 million in the same
six-month period in 2019. Excluding stock-based compensation,
SG&A expenses decreased by 29% to $3.6
million for the six-month period ended June 30, 2020, as compared to $5.0 million during the same six-month period in
2019. Stock-based compensation expense totaled $2.4 million for the six-month period ended
June 30, 2020, as compared to
$0.4 million for the same six-month
period in 2019. SG&A expenses remained consistent at
$2.2 million for each of the
three-month periods ended June 30,
2020 and June 30, 2019.
Net loss for the six-month period ended June 30, 2020 was $14.9
million, compared to a net loss of $14.8 million, in the same six-month period in
2019. Net loss for the three months ended June 30, 2020 was $10.6
million, compared to a net loss of $1.3 million in the same three-month period in
2019. Substantially impacting the net loss for each of the
three-month and six-month periods ended June
30, 2020 was a $9.4 million
expense taken due to a 100% impairment of the Company's investment
in Coinsquare, net of a $1.3 million
gain on extinguishment of debt. Both the $9.4 million Coinsquare expense and the
$1.3 million gain on debt
extinguishment are classified as non-recurring events.
Impacting the net loss for the three-month and six-month
periods ended June 30, 2019 was a net
total expense of $0.5 million and
$11.0 million, respectively, from the
net valuation changes in notes and warrants, Tess deconsolidation
gain, and gain on extinguishment of debt.
As at June 30, 2020, the Company
had $16.4 million in cash and
cryptocurrencies, as compared to $11.3
million at December 31,
2019.
COVID-19 Update: As published in its previous
disclosures, Riot is continuing to closely monitor COVID-19 and its
potential impact on the Company's workforce, operations, finance,
and liquidity. To date, the impact of COVID-19 has remained
minimal.
About Riot Blockchain
Riot Blockchain (NASDAQ: RIOT) specializes in cryptocurrency
mining with a focus on bitcoin. Riot also holds non-controlling
investments in blockchain technology companies. Riot is
headquartered in Castle Rock,
Colorado, and the Company's primary mining facility is
located in Massena, New York under
a colocation agreement with Coinmint. For more information, visit
www.RiotBlockchain.com.
Safe Harbor
The information provided in this press release may include
forward-looking statements relating to future events or the future
financial performance of the Company. Because such statements are
subject to risks and uncertainties, actual results may differ
materially from those expressed or implied by such forward-looking
statements. Words such as "anticipates," "plans," "expects,"
"intends," "will," "potential," "hope" and similar expressions are
intended to identify forward-looking statements. These
forward-looking statements are based upon current expectations of
the Company and involve assumptions that may never materialize or
may prove to be incorrect. Actual results and the timing of events
could differ materially from those anticipated in such
forward-looking statements as a result of various risks and
uncertainties. Detailed information regarding factors that may
cause actual results to differ materially from the results
expressed or implied by statements in this press release relating
to the Company may be found in the Company's periodic filings with
the Securities and Exchange Commission, including the factors
described in the sections entitled "Risk Factors," copies of which
may be obtained from the SEC's website at www.sec.gov. The Company
does not undertake any obligation to update forward-looking
statements contained in this press release.
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SOURCE Riot Blockchain, Inc.