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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,



Income from digital currency mining





Operating and maintenance costs of digital currency mining



Gross Mining Margin1



Gross Mining Margin %1






Gross Profit



Revaluation of digital currencies2



Gain on sale of digital currencies



General and administrative expenses



Foreign Exchange



Share-based compensation



Unrealized gain on investments


Finance expense



Tax expense (recovery)


Gain (loss) from continuing operations










Adjusted EBITDA3





Diluted income (loss) per share





Net cash inflows (outflows) from operating activities





Net cash inflows (outflows) from investing activities




Net cash inflows (outflows) from financing activities





As at

June 30, 2019

March 31, 2019

Total assets





Total non-current liabilities





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


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


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 under HIVE’s profile and on the Company’s website at

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.


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