Mined 117.1 Bitcoins in the Third Quarter of 2023 at an Average Market Revenue Value of Approximately
Implementing 'Infrastructure Light' Approach to Bitcoin Mining Business;
Conference Call to Be Held Today at
Operational Highlights
- Approximately 5,549 Bitcoin mining machines in operation at hosting sites as of
September 30, 2023 . - Mined 117.1 Bitcoin in Q3 2023, valued at approximately
$3.3 million based on the$28,000 average price of Bitcoin during the quarter. - Sequential quarterly revenue increased by 7.0% from the three months ended
June 30, 2023 .
Financial Highlights
- Total revenue for the quarter ended
September 30, 2023 , was approximately$3.4 million , an increase of$3.2 million , or more than 1,720%, from$0.2 million for the 2022 third quarter. The increase was primarily due to digital mining revenue of$3.3 million compared with$42 thousand of digital mining revenue in the same period last year as the Company commenced our Bitcoin mining operations inSeptember 2022 . The average BTC price for the quarter recognized as revenue was approximately$28,000 . - Net loss attributable to LM Funding shareholders for the third quarter ended
September 30, 2023 , was approximately$4.4 million , which included a$0.8 million non-cash, unrealized loss on investment and equity securities and a$0.8 million impairment on our Symbiont assets compared with net income of approximately$6.7 million for the third quarter of 2022, which included a$0.2 million unrealized loss on investment and equity securities. - Core EBITDA loss for the quarter ended
September 30, 2023 , totaled approximately$0.6 million , compared with Core EBITDA loss of$1.5 million in the 2022 comparable quarter, primarily due to the existence of material Bitcoin mining operations in the current year quarter that didn’t exist in the prior year. Core EBITDA is a non-GAAP financial measure, and a reconciliation of Core EBITDA to net loss is set forth below in this press release. - Cash of approximately
$0.5 million , digital assets of$2.2 million , and working capital of$4.5 million as ofSeptember 30, 2023 based on 90.1 BTC at a price of approximately$25,000 as ofSeptember 30, 2023 . The current BTC market price has averaged between$35,000 to$37,000 in recent weeks. InOctober 2023 , the Company also received approximately$800 thousand fromSeaStar Medical Holdings as a partial repayment of their outstanding note receivable. - Total LM Funding stockholders’ equity of approximately
$35.9 million , or$2.45 per share, as ofSeptember 30, 2023 (with the per-share amount calculated as LMFA stockholders’ equity divided by approximately 14,652,000 shares outstanding as ofSeptember 30 , 2023).
Investor Conference Call
LM Funding will host a conference call today,
The conference call will be available via telephone by dialing toll-free +1 888-506-0062 for
A webcast replay will be available on the investor relations section of the Company’s website at https://www.lmfunding.com/investors/news-events/ir-calendar through
About
Forward-Looking Statements
This press release may contain forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” and “project” and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guaranties of future results and conditions but rather are subject to various risks and uncertainties. Some of these risks and uncertainties are identified in the Company's most recent Annual Report on Form 10-K and its other filings with the
Contact:
Tel: (212) 671-1020
Email: LMFA@crescendo-ir.com
(tables follow)
2023 | 2022 | ||||||
(Unaudited) | |||||||
Assets | |||||||
Cash | $ | 469,007 | $ | 4,238,006 | |||
Digital Assets | 2,256,500 | 888,026 | |||||
Finance receivables | 21,558 | 26,802 | |||||
Marketable securities | 198,094 | 4,290 | |||||
Notes receivable from | 2,277,012 | 3,807,749 | |||||
Less: Allowance for credit loss reserve on notes receivable from | (22,344 | ) | - | ||||
Notes receivable from | 2,254,668 | 3,807,749 | |||||
Prepaid expenses and other assets | 1,463,094 | 1,233,322 | |||||
Income tax receivable | 293,466 | 293,466 | |||||
Current assets | 6,956,387 | 10,491,661 | |||||
Fixed assets, net | 25,917,390 | 27,192,317 | |||||
Deposits on mining equipment | 282,233 | 525,219 | |||||
Hosting services deposits | 2,218,452 | 2,200,452 | |||||
Real estate assets owned | 80,057 | 80,057 | |||||
Long-term investments - debt security | - | 2,402,542 | |||||
Less: Allowance for losses on debt security | - | (1,052,542 | ) | ||||
Long-term investments - debt security, net | - | 1,350,000 | |||||
Long-term investments - equity securities | 72,815 | 464,778 | |||||
Investment in | 683,100 | 10,608,750 | |||||
Symbiont intangible assets, net | 2,000,000 | - | |||||
Operating lease - right of use assets | 214,574 | 265,658 | |||||
Other assets | 10,726 | 10,726 | |||||
Long-term assets | 31,479,347 | 42,697,957 | |||||
Total assets | $ | 38,435,734 | $ | 53,189,618 | |||
Liabilities and stockholders' equity | |||||||
Accounts payable and accrued expenses | 2,253,311 | 1,570,906 | |||||
Note payable - short-term | 63,208 | 475,775 | |||||
Due to related parties | 44,398 | 75,488 | |||||
Current portion of lease liability | 106,689 | 90,823 | |||||
Total current liabilities | 2,467,606 | 2,212,992 | |||||
Lease liability - net of current portion | 114,855 | 179,397 | |||||
Long-term liabilities | 114,855 | 179,397 | |||||
Total liabilities | 2,582,461 | 2,392,389 | |||||
Stockholders' equity | |||||||
Preferred stock, par value | - | - | |||||
Common stock, par value | 14,652 | 13,092 | |||||
Additional paid-in capital | 94,722,633 | 92,195,341 | |||||
Accumulated deficit | (57,369,694 | ) | (43,017,207 | ) | |||
Total | 37,367,591 | 49,191,226 | |||||
Non-controlling interest | (1,514,318 | ) | 1,606,003 | ||||
Total stockholders' equity | 35,853,273 | 50,797,229 | |||||
Total liabilities and stockholders’ equity | $ | 38,435,734 | $ | 53,189,618 |
Three Months Ended | Nine Months Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Revenues: | |||||||||||||||
Digital mining revenues | $ | 3,283,473 | $ | 42,157 | $ | 8,342,646 | $ | 42,157 | |||||||
Specialty finance revenue | 101,535 | 104,835 | 474,544 | 450,920 | |||||||||||
Rental revenue | 34,500 | 40,788 | 111,486 | 120,240 | |||||||||||
Total revenues | 3,419,508 | 187,780 | 8,928,676 | 613,317 | |||||||||||
Operating costs and expenses: | |||||||||||||||
Digital mining cost of revenues (exclusive of depreciation and amortization shown below) | 2,708,672 | 38,960 | 6,738,170 | 38,960 | |||||||||||
Staff costs & payroll | 1,340,665 | 4,297,540 | 4,736,940 | 12,886,432 | |||||||||||
Professional fees | 419,173 | 714,730 | 1,228,503 | 2,520,981 | |||||||||||
Settlement costs with associations | - | - | 10,000 | 160 | |||||||||||
Selling, general and administrative | 201,151 | 209,328 | 683,174 | 446,519 | |||||||||||
Real estate management and disposal | 26,453 | 22,558 | 127,611 | 76,453 | |||||||||||
Depreciation and amortization | 1,516,873 | 38,617 | 3,487,866 | 43,718 | |||||||||||
Collection costs | 8,098 | 5,037 | 17,533 | (6,689 | ) | ||||||||||
Impairment loss on mined digital assets | 383,497 | 870 | 822,650 | 870 | |||||||||||
Realized gain on sale of mined digital assets | (261,191 | ) | - | (1,331,982 | ) | - | |||||||||
Other operating costs | 246,536 | 124,405 | 704,390 | 274,298 | |||||||||||
Total operating costs and expenses | 6,589,927 | 5,452,045 | 17,224,855 | 16,281,702 | |||||||||||
Operating loss | (3,170,419 | ) | (5,264,265 | ) | (8,296,179 | ) | (15,668,385 | ) | |||||||
Realized gain (loss) on securities | 1,788 | - | 1,788 | (349,920 | ) | ||||||||||
Realized gain on convertible debt securities | - | - | - | 287,778 | |||||||||||
Unrealized gain (loss) on marketable securities | 2,058 | (13,000 | ) | 6,436 | (36,900 | ) | |||||||||
Impairment loss on hosting deposits | - | - | (36,691 | ) | - | ||||||||||
Impairment loss on Symbiont assets | (750,678 | ) | - | (750,678 | ) | - | |||||||||
Unrealized gain (loss) on investment and equity securities | (778,078 | ) | (194,174 | ) | (10,317,613 | ) | 11,034,828 | ||||||||
Impairment loss on digital assets | - | (25,764 | ) | - | (403,471 | ) | |||||||||
Realized gain on sale of purchased digital assets | - | - | 1,917 | - | |||||||||||
Digital assets other income | - | - | - | 5,658 | |||||||||||
Other income - coupon sales | 10,160 | - | 639,472 | - | |||||||||||
Credit loss on | (22,344 | ) | - | (22,344 | ) | - | |||||||||
Gain on adjustment of note receivable allowance | - | - | 1,052,543 | - | |||||||||||
Other income - finance revenue | - | - | 37,660 | - | |||||||||||
Dividend income | - | 1,125 | - | 3,875 | |||||||||||
Interest income | 39,657 | 85,602 | 210,881 | 264,947 | |||||||||||
Loss before income taxes | (4,667,856 | ) | (5,410,476 | ) | (17,472,808 | ) | (4,861,590 | ) | |||||||
Income tax expense | - | (1,311,678 | ) | - | (1,311,678 | ) | |||||||||
Net Loss | $ | (4,667,856 | ) | $ | (6,722,154 | ) | $ | (17,472,808 | ) | $ | (6,173,268 | ) | |||
Less: loss (income) attributable to non-controlling interest | 250,880 | 59,298 | 3,120,321 | (3,373,299 | ) | ||||||||||
Net loss attributable to | $ | (4,416,976 | ) | $ | (6,662,856 | ) | $ | (14,352,487 | ) | $ | (9,546,567 | ) | |||
Basic loss per common share | $ | (0.33 | ) | $ | (0.51 | ) | $ | (1.08 | ) | $ | (0.73 | ) | |||
Diluted loss per common share | $ | (0.33 | ) | $ | (0.51 | ) | $ | (1.08 | ) | $ | (0.73 | ) | |||
Weighted average number of common shares outstanding | |||||||||||||||
Basic | 13,480,470 | 13,091,883 | 13,237,121 | 13,081,591 | |||||||||||
Diluted | 13,480,470 | 13,091,883 | 13,237,121 | 13,081,591 |
Nine Months ended | |||||||
2023 | 2022 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net loss | $ | (17,472,808 | ) | $ | (6,173,268 | ) | |
Adjustments to reconcile net income (loss) to net cash used in operating activities | |||||||
Depreciation and amortization | 3,487,866 | 43,718 | |||||
Noncash lease expense | 70,545 | 71,288 | |||||
Stock compensation | 917,057 | 988,498 | |||||
Stock option expense | 1,611,795 | 9,956,219 | |||||
Accrued investment income | (130,990 | ) | (259,867 | ) | |||
Impairment loss on digital assets | 822,650 | 404,341 | |||||
Impairment loss on hosting deposits | 36,691 | - | |||||
Impairment loss on Symbiont assets | 750,678 | - | |||||
Unrealized loss (gain) on marketable securities | (6,436 | ) | 36,900 | ||||
Unrealized loss (gain) on investment and equity securities | 10,317,613 | (11,034,828 | ) | ||||
Realized loss (gain) on securities | (1,788 | ) | 349,920 | ||||
Realized gain on convertible note receivable | - | (287,778 | ) | ||||
Realized gain on sale of digital assets | (1,333,899 | ) | - | ||||
Proceeds from securities | 554,036 | 2,565,893 | |||||
Convertible debt and interest converted into marketable securities | - | 844,882 | |||||
Investments in marketable securities | (739,616 | ) | (844,882 | ) | |||
Credit loss on | 22,344 | - | |||||
Reversal of allowance loss on debt security | (1,052,543 | ) | - | ||||
Change in operating assets and liabilities: | |||||||
Prepaid expenses and other assets | (123,221 | ) | 807,352 | ||||
Hosting deposits | (54,691 | ) | - | ||||
Repayments to related party | (31,090 | ) | (45,605 | ) | |||
Accounts payable and accrued expenses | 682,405 | 172,723 | |||||
Mining of digital assets | (8,352,805 | ) | (42,157 | ) | |||
Proceeds from sale of digital assets | 7,487,058 | - | |||||
Lease liability payments | (70,563 | ) | (75,574 | ) | |||
Deferred taxes and taxes payable | - | 841,678 | |||||
Net cash used in operating activities | (2,609,712 | ) | (1,680,547 | ) | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Net collections of finance receivables - original product | (8,765 | ) | 19,049 | ||||
Net collections of finance receivables - special product | 14,009 | (11,565 | ) | ||||
Capital expenditures | (1,913,303 | ) | (15,380 | ) | |||
Investment in note receivable | (100,000 | ) | (350,000 | ) | |||
Investment in note receivable - related party | - | (2,785,000 | ) | ||||
Collection of note receivable | 1,761,727 | - | |||||
Investment in digital assets | (35,157 | ) | (978,441 | ) | |||
Proceeds from sale of purchased digital assets | 43,678 | - | |||||
Symbiont asset acquisition | (402,359 | ) | - | ||||
Deposits for mining equipment | - | (16,467,402 | ) | ||||
Net cash used in investing activities | (640,170 | ) | (20,588,739 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Insurance financing repayments | (499,453 | ) | (114,688 | ) | |||
Insurance financing | 86,886 | - | |||||
Issue costs from the issuance of common stock | (106,550 | ) | - | ||||
Net cash used in financing activities | (519,117 | ) | (114,688 | ) | |||
(3,768,999 | ) | (22,383,974 | ) | ||||
CASH - BEGINNING OF PERIOD | 4,238,006 | 32,559,185 | |||||
CASH - END OF PERIOD | $ | 469,007 | $ | 10,175,211 | |||
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | |||||||
ROU assets and operating lease obligation recognized | $ | 21,887 | $ | 300,787 | |||
Reclassification of mining equipment deposit to fixed assets, net | $ | 1,177,226 | $ | 21,986,382 | |||
SUPPLEMENTAL DISCLOSURES OF CASHFLOW INFORMATION | |||||||
Cash paid for interest | $ | - | $ | - | |||
Cash paid for taxes | $ | - | $ | 470,000 |
NON-GAAP FINANCIAL INFORMATION (unaudited)
Our reported results are presented in accordance with
The following tables reconcile net loss, which we believe is the most comparable GAAP measure, to EBITDA and Core EBITDA:
Three Months Ended | Nine Months Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Net income (loss) | $ | (4,667,856 | ) | $ | (6,722,154 | ) | $ | (17,472,808 | ) | $ | (6,173,268 | ) | |||
Income tax expense | - | 1,311,678 | - | 1,311,678 | |||||||||||
Interest expense | - | - | - | - | |||||||||||
Depreciation and amortization | 1,516,873 | 38,617 | 3,487,866 | 43,718 | |||||||||||
Income (loss) before interest, taxes & depreciation | $ | (3,150,983 | ) | $ | (5,371,859 | ) | $ | (13,984,942 | ) | $ | (4,817,872 | ) | |||
Unrealized loss (gain) on investment and equity securities | 778,078 | 194,174 | 10,317,613 | (11,034,828 | ) | ||||||||||
Realized gain on convertible debt securities | - | - | - | (287,778 | ) | ||||||||||
Impairment loss on mined digital assets | 383,497 | 870 | 822,650 | 870 | |||||||||||
Impairment loss on Symbiont assets | 750,678 | - | 750,678 | - | |||||||||||
Gain on adjustment of note receivable allowance | - | - | (1,052,543 | ) | - | ||||||||||
Stock compensation and option expense | 621,827 | 3,648,239 | 2,528,852 | 10,944,717 | |||||||||||
Core income (loss) before interest, taxes & depreciation | $ | (616,903 | ) | $ | (1,528,576 | ) | $ | (617,692 | ) | $ | (5,194,891 | ) |
Source:
2023 GlobeNewswire, Inc., source