Digital asset mining firm Argo Blockchain has reported $18.8 million in losses in the first half of the year, reducing total losses to $75 million from last year.
The mining firm has struggled to navigate the tough path following wider market woes characterized by plunging prices of top crypto assets.
According to the company’s “Interim Half Year Results,” net losses are down by 50% compared to $39.6 million losses posted in the first half of 2022.
The company’s revenues plunged by 21% compared to 2022 results as a result of the declining price of Bitcoin (BTC). Following the collapse of the Terra network, the price of BTC and other assets took a nosedive, wiping off billions from the total market cap.
In total, the firm generated $24 million in revenue in the first six months of the year with a balance sheet that reflects 46 BTC in assets and $9.1 million in cash.
While a share of the money was raised through its operations, a portion ($7.5 million) was generated through a share placement offered to investors (institutional and retail) in July 2022.
The company’s previous debt profile which stood at $143 million in June 2022 sparked speculations about its general health to pull through the bear market.
So far, the company has reduced its debt to $75 million, a whopping $68 million cut as new investments open up for the firm.
Argo Blockchain also reduced its non-mining operational cost by 21% in the last quarter compared to Q2 2022.
Restructuring key to Algo’s survival
As stated earlier, last year was turbulent for most digital asset firms with many caught under the harsh crypto winter.
Amongst other sectors, miners took the most hit in 2022 as BTC lost over 55% of its value leading to declining revenues for miners. The high operating cost of some mining facilities led to sharp losses with many thinking outside the box to stay afloat including selling key assets and Bitcoin reserves.
Lassled to the plunging price of the asset is the increased global hashrate by 78% this year and general network difficulty.
The company faced threats of bankruptcy in late 2022 which prompted it to enter an agreement with Galaxy Digital which saw the sale of its Helios Mining Center for $65 million in December and a refinanced $35 million three-year backed loan with the company.
Matthew Shaw, the Chairman of Argo Blockchain noted the importance of the transactions with Galaxy Digital as it allowed the firm to restructure its operations.
“The transactions reduced total indebtedness by $41 million and allowed Argo to simplify its operating structure.”
The company has increased its hashrate over time to 2.6EH/s with an additional 1,242 BlockMiner machines in its Quebec facilities with plans to raise it to 2.8EH/s in the coming months.
Finally, in line with its plans to reduce debt, Argo plans to sell certain non-core assets.
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