REG - Argo Blockchain PLC - January 2022 Operational Update

Argo BlockchainAnnouncement

07/02/2022 07:00

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RNS Number : 8121A  Argo Blockchain PLC  07 February 2022

Press Release

07 February 2022

 

Argo Blockchain PLC

("Argo" or "the Company")

January 2022 Operational Update

 

Operational Update

Argo Blockchain plc, a global leader in cryptocurrency mining (LSE: ARB;
NASDAQ: ARBK), is pleased to provide the following operational update for
January 2022.

 

During the month of January, Argo mined 172 Bitcoin or Bitcoin Equivalent
(together, BTC) compared to 214 BTC in December 2021. This reduction during
January is primarily due to an increase in network difficulty.

 

Based on daily foreign exchange rates and cryptocurrency prices during the
month, mining revenue in January amounted to £5.26 million [$7.10 million*]
(December 2021: £7.82 million [$10.55 million*]).

 

Argo generated this income at a Bitcoin and Bitcoin Equivalent Mining Margin
of approximately 74% for the month of January (December 2021: 83%).

 

At the end of January, the Company owned 2,748 Bitcoin of which 262 were BTC
equivalents.

 

Peter Wall, Chief Executive of Argo and interim Chairman, said: "As our mining
operations continue to develop and the completion date of Helios, our new
mining facility, approaches, this month we have laid the foundations for
executing our growth strategy for 2022 and achieving the objectives we have
set for the Company in the year ahead".

 

Non-IFRS Measures

 

Bitcoin and Bitcoin Equivalent Mining Margin is a financial measure not
defined by IFRS. We believe Bitcoin and Bitcoin Equivalent Mining Margin has
limitations as an analytical tool. In particular, Bitcoin and Bitcoin
Equivalent Mining Margin excludes the depreciation of mining equipment and so
does not reflect the full cost of our mining operations, and it also excludes
the effects 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 similarly titled measures used by other companies.
As a result, you should not consider this measure in isolation from, or as a
substitute analysis for, our gross margin as determined in accordance with
IFRS.

 

The following table shows a reconciliation of gross margin to Bitcoin and
Bitcoin Equivalent Mining Margin, the most directly comparable IFRS measure,
for the months of December 2021 and January 2022.

 ( )
                                                                                   Month Ended 31 December 2021                    Mont
                                                                                                                                   h
                                                                                                                                   Ende
                                                                                                                                   d
                                                                                                                                   31Ja
                                                                                                                                   nuar
                                                                                                                                   y
                                                                                                                                   2022
                                               £                       $                       £                       $
 Gross (loss)                                  (12,593,995)            (17,008,110)            (13,204,218)            (17,832,213)
 Gross Margin¹                                 (161%)                  (161%)                  (251%)                  (251%)
 Depreciation of mining equipment              1,444,614               1,950,942               1,284,142               1,734,226
 Charge in fair value of digital currencies    18,271,429              24,675,448              15,460,310              20,879,050
 Realised loss on sale of digital currencies   740,713                 1,000,328               331,171                 447,244
 Cryptocurrency management fees²               (1,388,635)             (1,875,343)              -                       -

 Mining Profit                                 6,474,126               8,743,265               3,871,405               5,228,308
 Bitcoin and Bitcoin Equivalent Mining Margin  83%                     83%                     74%                     74%

 (1) Due to unfavourable changes in fair value of Bitcoin and Bitcoin
 Equivalents in December 2021 and January 2022 there was a loss on change in
 fair value of digital currencies.
 (2) The cryptocurrency management fees include the settlement amount with
 Celsius and as such are higher than normal in December 2021.

*Dollar values translated from pound sterling into U.S. dollars using the noon
buying rate of the Federal Reserve Bank of New York as at the applicable
dates.

 

Forward-Looking Information

 

This announcement contains inside information and includes forward-looking
statements which reflect the Company's or, as appropriate, the Directors'
current views, interpretations, beliefs or expectations with respect to the
Company's financial performance, business strategy and plans and objectives of
management 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 which include the words "expects",
"intends", "plans", "believes", "projects", "anticipates", "will", "targets",
"aims", "may", "would", "could", "continue", "estimate", "future",
"opportunity", "potential" or, in each case, their negatives, and similar
statements of a future or forward-looking nature identify forward-looking
statements. All forward-looking statements address matters that involve risks
and uncertainties because they relate to events that may or may not occur in
the future.  Forward-looking statements are not guarantees of future
performance.  Accordingly, there are or will be important factors that could
cause the Company's actual results, prospects and performance to differ
materially from those indicated 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, those 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 Rules, 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 law and regulations, the Company undertakes no obligation publicly
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 Company makes 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:

 

 Argo Blockchain
 Peter Wall                          via Tancredi +44 203 434 2334

 Chief Executive
 finnCap Ltd
 Corporate Finance                   +44 207 220 0500

 Jonny Franklin-Adams

 Tim Harper

 Joint Corporate Broker

 Sunila de Silva
 Tennyson Securities
 Joint Corporate Broker              +44 207 186 9030

 Peter Krens
 OTC Markets
 Jonathan Dickson                    +44 204 526 4581

 jonathan@otcmarkets.com             +44 7731 815 896
 Tancredi Intelligent Communication

 UK & Europe Media Relations
 Emma Valgimigli                     +44 7727 180 873

 Emma Hodges                         +44 7861 995 628

 Salamander Davoudi                  +44 7957 549 906

 Fabio Galloni-Roversi Monaco        +44 7888 672 701

 argoblock@tancredigroup.com

 

About Argo:

Argo Blockchain plc is a global leader in cryptocurrency mining with one of
the largest and most efficient operations powered by clean energy. The Company
is headquartered in London, UK and its shares are listed on the Main Market of
the London Stock Exchange under the ticker: ARB and on the Nasdaq Global
Select Market in the United States under the ticker: ARBK.

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