Bit Digital, Inc. Announces the First Half of Fiscal Year 2020 Financial Results
Bit Digital (BTBT) reported its financial results for the first half of 2020, revealing $0.69 million in revenue from bitcoin mining, with 74.72 bitcoins earned. The company's hash rate capacity reached 1,250 Peta-hash per second following the deployment of 22,869 miners. Despite a net loss of $4.10 million and a loss per share of $0.24, the management anticipates significant revenue growth in the second half of 2020 due to ongoing investments in miners. The company is expanding operations in both China and the U.S.
- Revenue growth potential anticipated in second half of 2020.
- Hash rate increased to 1,250 Peta-hash per second.
- Total miners operational reached 22,869, enhancing bitcoin production capabilities.
- Net loss from bitcoin mining at $0.37 million.
- Total net loss for the company at $4.10 million.
- Loss per share increased from $0.43 to $0.24 compared to the previous year.
NEW YORK, Oct. 19, 2020 /PRNewswire/ -- Bit Digital, Inc. (Nasdaq: BTBT) (the "Company"), an emerging bitcoin mining company headquartered in New York, U.S. today announced its unaudited financial results for the six months ended June 30, 2020.
The above table presents the number of bitcoins received from the mining pool operator on a monthly basis:
"We commenced our bitcoin mining business in February 2020. By now, our hash rate capacity reached 1,250 Peta-hash per second ("Ph/s"), and the management has determined that the Company, in terms of the operating hash rate capacity, is the first among NASDAQ listed companies in bitcoin mining industry." said Mr. Hong Yu, the Chief Strategy Officer of the Company. "We are and we will make continuous investments in improving our hash rate capacity to keep our competitiveness in the industry."
"The bitcoin mining business is a challenge and an opportunity to the Company. We performed comprehensive evaluation, planning and design on the new business before we got started." said Mr. Erke Huang, the Chief Financial Officer of the Company. "For the first half 2020, we had revenue of
Financial Highlights for the First Half 2020
- Revenue from bitcoin mining business was
$0.69 million . - The number of bitcoins earned from bitcoin mining business was 74.72.
- The number of miners was 6,004 MicroBT M21S, of which 3,429 and 2,575 miners were acquired in May and June 2020, respectively.
- The net loss from continuing operations of
$0.37 million was all from bitcoin mining business, compared to $nil for the first half 2019. - The net loss from discontinued operations was
$3.73 million for the first half 2020, as we provided full impairment on assets for our discontinued peer-to-peer and car rental business in the PRC, compared with the net loss from discontinued operations of$6.46 million for the first half 2019. - The net loss was
$4.10 million and the loss per share was$0.24 for the first half 2020, compared with$6.46 million and$0.43 for the same period last year.
Business developments
On April 8, 2020, we acquired the XMAX Chain Limited, a wholly owned subsidiary based in Hong Kong. In the third quarter 2020, we launched additional 16,765 units of miners in Xinjiang, Inner Mongolia and Sichuan Provinces, all in the PRC.
On September 1, 2020, we established Bit Digital USA, Inc. ("BT USA"), a wholly owned subsidiary incorporated in Delaware, United States, through which we intend to operate bitcoin mining business with our miners in the United States. In September, we commenced trial operation with 100 units of miners under operation in Texas, United States.
On September 17, 2020, BT USA entered into a certain agreement with Compute North LLC headquartered in Nebraska U.S. Pursuant to the service agreement, Compute North would provide bitcoin mining facilities for the colocation and managing of mining equipment of the Company's bitcoin business which are expected to save the Company operating utilities and rent cost. Going forward, we expect more miners operating in the Unites States.
As of the date of this report, we had a total of 22,869 miners under operations. As of September 30, 2020, our hash rate reached 1,250 Ph/s. At full deployment of our 22,869 miners, our hash rate capacity reached 1,250 Ph/s, with the aggregate mining efficiency of 61.88 joules per terahash (J/TH), consuming 76 MW of power. By the report date, we have earned an aggregation of 949.51 bitcoins and recognized unaudited revenues of approximately
As of September 30, 2020, and June 30, 2020, we had 60 and 16 bitcoins on hand. The following table presents our bitcoin mining activities in coins as of September 30, 2020 and June 30, 2020.
Number of | Amounts | |||||
Balance at January 1, 2020 | - | $ | - | |||
Receipt of cryptocurrencies from mining services | 75 | 692,698 | ||||
Sales of cryptocurrencies | (58) | (544,210) | ||||
Realized gain on sale of cryptocurrencies | - | (4,990) | ||||
Balance at June 30, 2020 | 16 | $ | 153,478 | |||
Receipt of cryptocurrencies from mining services | 740 | |||||
Sales of cryptocurrencies | (696) | |||||
Balance at September 30, 2020 | 60 | |||||
Other recent developments
On July 6, 2020, the Company completed the sale of 21,500,000 share of common stock at
On September 8, 2020, the Board approved the disposal of Point Cattle Holdings Limited, a former wholly owned subsidiary of the Company in the British Virgin Islands, and its subsidiaries and VIEs, through which the Company previously operated its peer-to-peer lending business and the car rental business in PRC. Upon the sale, we discontinued our peer-to-peer lending business and the car rental business in the PRC ("discontinued operations"). In addition to our bitcoin mining business, we plan to operate our car rental business through Golden Bull USA, Inc., a wholly owned subsidiary based in the United States once the Coronavirus pandemic is curtailed.
On the same date, the Company entered into a certain share purchase agreement (the "Disposition SPA") by and among a BVI company, Sharp Whale Limited (the "Purchaser"), Point Cattle Holding Limited (the "Subsidiary") and the Company (the "Seller"). Pursuant to the Disposition SPA, the Purchaser purchased the Subsidiary in exchange for nominal consideration of
On September 14, 2020, the Company officially changed its name from "Golden Bull Limited" to "Bit Digital, Inc.", which the management believes more closely reflects the Company's bitcoin mining business. We had already changed our Nasdaq trading symbol to "BTBT".
Financial Results for the Six Months Ended June 30, 2020
Because the financial results for the first half 2019 all resulted from peer-to-peer lending business and the car rental business in the PRC, which were reported as "net loss from discontinued operations", and we commenced our bitcoin mining business in February 2020, our comparative figures of revenues, cost and expenses were reported as $nil for the first half 2019.
Revenues
We commenced our bitcoin mining business in February 2020. We generated revenues from provision of computing power to the digital asset mining pool, and the consideration was in the form of cryptocurrencies, the value of which is determined using the market price of the related cryptocurrency at the time of receipt. Providing computing powers to successfully add a block to the blockchain, the Company is entitled to a fractional share of the fixed cryptocurrency from the mining pool operator, which is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm.
For the first half 2020, we received 74.72 bitcoins from one mining pool operator by providing computing power in our 6,004 MicroBT M21S miners, and we recognized revenue of
We will continue to invest in the miners to increase the hash rate capacity, as a percentage of total computing power contributed by all mining pool participants. Our mining operations are in Xinjiang, Inner Mongolia and Sichuan Provinces PRC and we launched new mining operations in Texas, United States in September 2020.
In the third quarter 2020, we launched an additional 16,865 units of miners, and our hash rate reached 1,250 Ph/s. As a result, we expect a significant increase in revenue for the second half 2020. Also, with more miners operating in the United States, we expect the energy cost to decrease on an overall basis.
Cost of revenues
Cost of revenues of
We expect to have a sharp increase in cost of revenues in the second half 2020 as we launched an additional 16,865 units of miners in the third quarter, spreading over Xinjiang, the PRC, Inner Mongolia, the PRC, Sichuan Province, the PRC, and Texas, U.S. In addition, we continue to focus on expansion and upgrade of our miners, and the increase in cost of revenues is expected to be in line with the increase of our revenues.
Depreciation and amortization expenses
For the first half 2020, the depreciation and amortization expenses represented depreciation of 6,004 miners with an estimated useful life of 3 years.
General and administrative expenses
For the first half 2020, our general and administrative expenses were primarily comprised of professional and consulting expenses of
Realized gain on exchange of cryptocurrencies
We recorded cryptocurrencies are recorded at cost and any gains or losses from sales of cryptocurrencies are recorded as "Realized gain/(loss) on exchange of cryptocurrencies" in the consolidated statements of operations. We recorded gains of
Net loss from discontinued operations
For the first half 2020, we provided full impairment of
Income tax expenses
Income tax expenses was $nil and $nil for the first half 2020 and 2019, respectively, as we incurred net operating losses for the relevant period.
Net loss and loss per share
For the first half 2020, our net loss was comprised of
Loss per share was
Financial Condition and Cash Flow
As of June 30, 2020, the Company had cash, cash equivalents and restricted cash of
Net cash used in operating activities was
Net cash used in investing activities was
Net cash provided by financing activities was
About Bit Digital, Inc.
Effective on September 14, 2020 after disposal of its peer-to-peer lending business, the Company officially changed its Company name from "Golden Bull Limited" to "Bit Digital, Inc." (NASDAQ: BTBT). The Company is headquartered in New York, U.S., and commenced bitcoin mining business in February 2020. More information about the Company can be found at its investor relations website at http://www.bit-digital.com/.
Safe Harbor Statement
This press release may contain certain "forward-looking statements" relating to the business of Bit Digital, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
BIT DIGITAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS As of June 30, 2020 and December 31, 2019 (Expressed in U.S. dollars, except for the number of shares) | ||||||||
June 30, | December 31, | |||||||
(unaudited) | ||||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 1,911,226 | $ | 15,988 | ||||
Restricted cash | 600,000 | - | ||||||
Cryptocurrencies | 153,478 | - | ||||||
Other current assets | 12,801 | 12,501 | ||||||
Assets of discontinued operations | - | 531,767 | ||||||
Total Current Assets | 2,677,505 | 560,256 | ||||||
Restricted cash, noncurrent | - | 600,000 | ||||||
Deposits for equipment | 6,864,320 | 110,000 | ||||||
Property and equipment, net | 4,419,939 | - | ||||||
Assets of discontinued operations, noncurrent | - | 3,246,277 | ||||||
Total Assets | $ | 13,961,764 | $ | 4,516,533 | ||||
LIABILITIES AND EQUITY | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | 97,490 | $ | - | ||||
Due to related parties | 908,134 | 120,000 | ||||||
Other payables and accrued liabilities | 210,322 | 266,048 | ||||||
Current liabilities of discontinued operations | - | 43,546 | ||||||
Total Current Liabilities | 1,215,946 | 429,593 | ||||||
Total Liabilities | 1,215,946 | 429,593 | ||||||
Commitments and Contingencies | ||||||||
Shareholders' Equity | ||||||||
Common shares, | 221,992 | 153,992 | ||||||
Share subscription receivables | (45,457) | (45,457) | ||||||
Advance of share subscription fees from shareholders | 10,160,718 | - | ||||||
Additional paid-in capital | 20,145,220 | 17,610,220 | ||||||
Statutory reserve | 6,189 | 6,189 | ||||||
Accumulated deficit | (17,894,991) | (13,790,151) | ||||||
Accumulated other comprehensive loss | (100,186) | (100,186) | ||||||
Total Bit Digital, Inc.'s Shareholders' Equity | 12,493,485 | 3,834,607 | ||||||
Noncontrolling interests | 252,333 | 252,333 | ||||||
Total Equity | 12,745,818 | 4,086,940 | ||||||
Total Liabilities and Equity | $ | 13,961,764 | $ | 4,516,533 | ||||
BIT DIGITAL, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS For the Six Months Ended June 30, 2020 and 2019 (Expressed in U.S. dollars, except for the number of shares) | ||||||||
For the Six Months | ||||||||
2020 | 2019 | |||||||
Revenue from cryptocurrency mining | $ | 692,698 | $ | - | ||||
Cost and operating expenses | ||||||||
Cost of revenues | (656,014) | - | ||||||
Depreciation and amortization expenses | (70,501) | - | ||||||
General and administrative expenses | (340,569) | - | ||||||
Total operating expenses | (1,067,084) | - | ||||||
Loss from Operations | (374,386) | - | ||||||
Realized gain on exchange of cryptocurrencies | 5,968 | - | ||||||
Interest income | 40 | - | ||||||
Other expenses | (1,964) | - | ||||||
Net loss from continuing operations before income taxes | (370,342) | - | ||||||
Income tax expenses | - | - | ||||||
Net loss from continuing operations | (370,342) | - | ||||||
Net loss from discontinued operations | (3,734,498) | (6,462,425) | ||||||
Net loss | (4,104,840) | (6,462,425) | ||||||
Net loss attributable to noncontrolling interests | - | - | ||||||
Net loss attributable to Bit Digital, Inc.'s shareholders | $ | (4,104,840) | $ | (6,462,425) | ||||
Other comprehensive income | ||||||||
Foreign currency translation adjustment | - | 34,128 | ||||||
Comprehensive loss | (4,104,840) | (6,428,297) | ||||||
Total comprehensive loss attributable to noncontrolling interests | - | - | ||||||
Total comprehensive loss attributable to BT Digital Inc.'s shareholders | $ | (4,104,840) | $ | (6,428,297) | ||||
Weighted average number of ordinary share outstanding | ||||||||
Basic and Diluted | 17,379,405 | 14,899,185 | ||||||
Loss per share | ||||||||
Basic and Diluted | $ | (0.24) | $ | (0.43) | ||||
BIT DIGITAL, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the Six Months Ended June 30, 2020 and 2019 (Expressed in U.S. dollars, except for the number of shares) | ||||||||
For the Six Months | ||||||||
2020 | 2019 | |||||||
Net loss | $ | (4,104,840) | $ | (6,462,425) | ||||
Less: Net loss from discontinued operations | 3,734,498 | 6,462,425 | ||||||
Net loss from continuing operations | (370,342) | - | ||||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation of property and equipment | 70,501 | - | ||||||
Loss from acquisition of a subsidiary | 1,964 | - | ||||||
Changes in operating assets and liabilities: | ||||||||
Cryptocurrencies | (705,118) | - | ||||||
Other current assets | (300) | - | ||||||
Accounts payable | 97,490 | - | ||||||
Other payables and accrued liabilities | (57,014) | - | ||||||
Net Cash Used in Operating Activities from Continuing Operations | (962,819) | - | ||||||
Net Cash Used in Operating Activities from Discontinued Operations | - | (1,969,400) | ||||||
Net Cash Used in Operating Activities | (962,819) | (1,969,400) | ||||||
Cash Flows from Investing Activities: | ||||||||
Purchases of property and equipment | (11,244,761) | - | ||||||
Proceeds from sales of cryptocurrencies | 551,640 | - | ||||||
Acquisition of cash in connection with acquisition of a subsidiary | 11,326 | - | ||||||
Net Cash Used in Investing Activities | (10,681,795) | - | ||||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from borrowings from related parties | 776,134 | - | ||||||
Proceeds from issuance of common stock under private placement transaction | 2,600,000 | - | ||||||
Advances of share subscription fees from shareholders under private placement | 10,163,718 | - | ||||||
Net Cash Provided by Financing Activities | 13,539,852 | - | ||||||
Effect of exchange rate changes on cash and cash equivalents | - | 34,128 | ||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | 1,895,238 | (1,935,272) | ||||||
Cash, cash equivalents and restricted cash at beginning of period | 615,988 | 2,934,425 | ||||||
Cash, cash equivalents and restricted cash at end of period | $ | 2,511,226 | $ | 999,153 | ||||
Supplemental Cash Flow Information | ||||||||
Cash paid for interest expense | $ | - | $ | - | ||||
Cash paid for income tax | $ | - | $ | - | ||||
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SOURCE Bit Digital, Inc.
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