Argo Blockchain, one of the companies battling negative market conditions and an extremely competitive mining ecosystem, reported a net loss of $39.6 million in 2022, which decreased by over 50% to $18.8 million in the first half of 2023. Argo also stated that it reduced its debt by $4 million in 2023, bringing the total debt down to $75 million. The company reduced its debt by $68 million from $143 million in June 2022.
Bitcoin Price Decreases Revenue
While revenues decreased by 31% compared to the first half of 2022, Argo achieved a net income of $24 million in the middle of 2023. The company attributed this to the decrease in the value of Bitcoin, which raised the global hash rate and network difficulty. Argo reported that it mined a total of 947 BTC in the first half of the year, which was only a 1% increase compared to the same period in 2022. It is worth noting that there was a 78% increase in the global hash rate in 2023.
As of June 2023, Argo has $9.1 million in cash and 46 BTC on its balance sheet. Argo started the second half of the year by generating $7.5 million in gross revenue through a stock offering to institutional and retail investors in July 2022. Although the company issued a warning about facing bankruptcy towards the end of 2022, the interim results for 2023 indicate that Argo plans to deploy approximately 1,628 BlockMiner units, increasing its total hash rate capacity to 2.8 exahashes per second (EH/s) at its Quebec-based mining facilities.
Exploring Debt Reduction and Other Options
Argo also reported being in advanced discussions to sell “non-core assets” and exploring other options to reduce its overall debt. Argo Chairman Matthew Shaw highlighted the “transformative series of transactions” with Galaxy Digital, which sold the Helios mining facility and property for $65 million in December 2022. Argo then refinanced a $35 million three-year asset-backed loan with Galaxy.
“These transactions reduced total indebtedness by $41 million and allowed Argo to simplify its operating structure.”
Shaw emphasized the importance of maintaining a fleet of over 27,000 miners for Argo’s ongoing operations and added that approximately 23,600 Bitmain S19J Pro units are operating at the Helios site through an ongoing hosting agreement with Galaxy. Prior to the agreement with Galaxy for the Helios facility, Argo had warned of dire financial conditions towards the end of 2022. Following the completion of the deal, former Argo CEO Peter Wall announced his resignation from the company.
