Blockchain
HIVE Blockchain Reports $5.6 Million of Net Income, Positive Cash Flow and Releases First Quarter Financial Results
HIVE Blockchain Technologies Ltd. (TSX.V:HIVE) (OTCQX:HVBTF) (the “Company” or “HIVE”) announces its results for the first quarter ended June 30, 2019 (all amounts in US dollars, unless otherwise indicated).
“I am pleased to report a healthy first quarter of positive net income and positive cash flow,” said Frank Holmes, Interim Executive Chairman of HIVE. “The financial results reflect our relentless efforts to restructure the Company to ensure transparency and accountability and to strengthen our operational control of HIVE and improve our operational efficiency. These improvements along with a record quarter of mining Bitcoin enabled us to navigate successfully the significant year-over-year decline in the price of Ethereum. The Company ended the first quarter on solid financial footing with nearly $22 million of current assets, including nearly $8 million of cash.”
“Despite positive financial results, 2019 has been a challenging year for HIVE as we were forced to defend against a proxy battle,” added Mr. Holmes. “However, we prevailed and the Company is benefitting from improved transparency, including new direct contracts with local suppliers rather than through our service provider,and financial controls. We expect further continued improvements throughout the fiscal year.
“Our Swedish facility was shut down through much of the first half of the calendar year, a period of low Ethereum prices. We successfully rebooted the facility in July and are already seeing improvements in efficiency from our new strategic partnership with Blockbase Group announced in August, with transition anticipated to be complete in the near future.”
“Blockchain technology and cryptocurrencies continue to evolve,” noted Mr. Holmes. “I am proud of the progress that we have made as industry leaders. We remain at the forefront of an emerging industry and our financial results speak to the operational improvements that we have made at the Company. With an improved cost structure and stabilization of the asset class, I remain confident that HIVE is very well positioned to benefit from positive momentum in the blockchain ecosystem.
“We are hopeful these operational improvements will ultimately be reflected in our share price,” concluded Mr. Holmes. “For most of our history as a public company, there has been a significant correlation between cryptocurrency prices and HIVE’s share price as investors have used us as proxy for cryptocurrencies. Unfortunately, that correlation was impacted negatively following the proxy battle in the spring. This was amplified recently by large selling volume by a large blockchain industry ETF. This ETF uses rules-based investing and had to divest its shares in HIVE due to portfolio rules requiring issuers to have a market capitalization above $100 million. However, these shares have now been absorbed by new buyers. The ETF will able to reacquire their position, as they have with other companies, when our market cap rises back above $100 million.”
Q1 2020 Highlights
- Generated income of $9.1 million, with a gross mining margin of $3.6 million from mining of digital currencies;
- Mined 1,331 newly minted Bitcoin during the period
- Mined approximately 35,000 Ethereum Classic and over 3,200 newly minted Ethereum during the period
- Earned net income of $5.6 million for the period.
Financial Review
For the quarter ended June 30, 2019, HIVE’s gross mining margin was 39%. First quarter income from digital currency mining was produced from an average of 3.8 MW of GPU production capacity, and 300 PH of Cloud Mining capacity, as at June 30, 2019. Below is an analysis of the Company’s income and gross mining margin:
|
Three months ended June 30, |
||||
|
2019 |
2018 |
|||
|
Income from digital currency mining |
$ |
9,123,630 |
$ |
10,660,664 |
|
Operating and maintenance costs of digital currency mining |
(5,554,975) |
(4,219,483) |
||
|
Gross Mining Margin1 |
3,568,655 |
6,441,181 |
||
|
Gross Mining Margin %1 |
39% |
60% |
||
|
Depreciation |
(1,252,957) |
(4,684,456) |
||
|
Gross Profit |
2,315,698 |
1,756,725 |
||
|
Revaluation of digital currencies2 |
2,893,831 |
(1,336,918) |
||
|
Gain on sale of digital currencies |
743,125 |
61,672 |
||
|
General and administrative expenses |
(1,299,115) |
(1,539,540) |
||
|
Foreign Exchange |
(1,110,419) |
(1,477,583) |
||
|
Share-based compensation |
(293,880) |
(98,001) |
||
|
Unrealized gain on investments |
2,359,508 |
– |
||
|
Finance expense |
(53,965) |
(38,794) |
||
|
Tax expense (recovery) |
– |
(50,000) |
||
|
Gain (loss) from continuing operations |
$ |
5,554,783 |
$ |
(2,722,439) |
|
EBITDA3 |
$ |
4,502,197 |
$ |
2,050,811 |
|
Adjusted EBITDA3 |
$ |
1,902,246 |
$ |
3,485,730 |
|
Diluted income (loss) per share |
$ |
0.02 |
$ |
(0.01) |
|
Net cash inflows (outflows) from operating activities |
$ |
844,340 |
$ |
8,277,266 |
|
Net cash inflows (outflows) from investing activities |
$ |
– |
$ |
(7,305,432) |
|
Net cash inflows (outflows) from financing activities |
$ |
272,328 |
$ |
214,040 |
|
As at |
June 30, 2019 |
March 31, 2019 |
||
|
Total assets |
$ |
33,170,539 |
$ |
27,761,197 |
|
Total non-current liabilities |
$ |
356,089 |
$ |
– |
|
(1) |
Gross mining margin equates to income from digital mining less operating and maintenance costs and is a non-IFRS measure; see Non-IFRS Measures in MD&A for reconciliation |
|
(2) |
Revaluation is calculated as the change in value (gain or loss) on the coin inventory. When coins are sold, the net difference between the proceeds and the carrying value of the digital currency (including the revaluation), is recorded as a gain (loss) on the sale of digital currencies |
|
(3) |
EBITDA and Adjusted EBITDA are non-IFRS measures; see Non-IFRS Measures in MD&A for reconciliation |
Financial Statements and MD&A
The Company’s Condensed Interim Consolidated Financial Statements and Management’s Discussion and Analysis (MD&A) thereon for the three months ended June 30, 2019 will be accessible on SEDAR at www.sedar.com under HIVE’s profile and on the Company’s website at www.HIVEblockchain.com.
Webcast Details
Management will host a webcast on Wednesday, October 9, 2019 at 8:30am Eastern Time to discuss the financial results for the three months ended June 30, 2019. Presenting on the webcast will be Frank Holmes, Interim Executive Chairman and Darcy Daubaras, Chief Financial Officer. Webcast details will be provided in a separate news release.
SOURCE HIVE Blockchain Technologies Ltd.
Blockchain
Blocks & Headlines: Today in Blockchain (BRICS, Hungri Games, Nano Labs, MetaHorse Unity)
Building Customer Trust in AI with Blockchain
Blockchain is emerging as a critical tool in addressing the trust deficit in artificial intelligence. By leveraging decentralized ledgers, companies can provide transparent data provenance, ensuring that AI algorithms operate ethically and without bias. This integration allows customers to verify the origins of data used in AI models, fostering greater confidence.
Businesses deploying blockchain for AI governance must prioritize simplicity and accessibility in their implementations. While the technology’s potential is immense, it is essential to communicate its benefits in a manner that resonates with non-technical stakeholders.
Source: Harvard Business Review
Blockchain at a Crossroads: Balancing Promise and Peril
As blockchain technology matures, it finds itself at a crossroads. On one side, the promise of decentralization continues to captivate industries, offering solutions for supply chain management, finance, and digital identity. On the other, challenges such as regulatory scrutiny, scalability issues, and energy consumption threaten to impede its growth.
The path forward will require a concerted effort from developers, regulators, and industry leaders. Collaborative frameworks that address these challenges while preserving blockchain’s core principles of decentralization and transparency are key to ensuring its sustained relevance.
Source: Cointelegraph
BRICS vs. USD: Blockchain’s Role in Economic Shifts
The BRICS nations (Brazil, Russia, India, China, and South Africa) are exploring blockchain-based solutions to reduce their reliance on the US dollar in international trade. By adopting decentralized technologies, these nations aim to foster economic independence and promote stability in the face of geopolitical tensions.
This initiative exemplifies blockchain’s potential to redefine global financial systems. However, its success hinges on addressing interoperability issues and fostering international collaboration. The evolution of blockchain-based trade networks could mark the beginning of a new era in economic diplomacy.
Source: CoinGeek
Hungri Games Expands MetaHorse Unity to Base Blockchain
Hungri Games has announced the expansion of its MetaHorse Unity project to the Base blockchain, aiming to enhance the gaming experience with improved scalability and lower transaction costs. This move aligns with the growing trend of integrating blockchain into gaming to create transparent and secure ecosystems.
By adopting Base, a layer-2 blockchain, MetaHorse Unity seeks to offer players a seamless and cost-effective gaming experience. The partnership highlights the potential of blockchain to transform the gaming industry, enabling innovative monetization models and fostering player engagement.
Source: CoinTrust
Nano Labs Purchases Trump Tokens to Celebrate Presidency
Nano Labs commemorated former President Donald Trump’s legacy with the acquisition of 47 Trump Tokens. This symbolic gesture underscores the intersection of blockchain technology and cultural milestones, showcasing how tokens can represent historical and social narratives.
The purchase also highlights the increasing role of blockchain in creating unique, tradable assets that capture moments in time. As tokenization continues to gain traction, it is redefining how value and significance are assigned in the digital age.
Source: PRNewswire
Final Thoughts: Blockchain’s Expanding Horizons
This week’s developments highlight the diverse applications of blockchain technology, from fostering trust in AI to reshaping global economic systems. As the industry navigates challenges and opportunities, collaboration and innovation will be crucial in unlocking blockchain’s full potential.
While hurdles such as scalability and regulation persist, the technology’s ability to drive transparency, security, and inclusivity remains unparalleled. The coming years will undoubtedly see blockchain continue to evolve, solidifying its role as a transformative force across sectors.
The post Blocks & Headlines: Today in Blockchain (BRICS, Hungri Games, Nano Labs, MetaHorse Unity) appeared first on News, Events, Advertising Options.
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