Stronghold Digital Mining, Inc. Q3 FY2022 Earnings Call

· Earnings call transcript and AI-powered summary

  • Revenue: $24.7 million for Q3 2022, a 311% increase compared to $6 million in Q3 2021, but sequentially lower due to decreased Bitcoin mining and power plant downtime.
  • Bitcoin Production: 567 BTC mined in Q3, an 11% sequential decrease due to reduced hash rate and higher network difficulty.
  • Adjusted EBITDA: -$3 million, worsening from -$1 million in Q2 2022 and flat EBITDA a year ago.
  • Debt Reduction: Successfully eliminated $67 million of debt by returning ~26,000 miners to NYDIG lenders.
  • Credit Facility: Closed new agreement with WhiteHawk, extending maturity from 13 to 36 months and adding $21 million net cash to the balance sheet. Outstanding debt under this facility is ~$58 million.
  • Liquidity: As of Nov 7, 2022, total cash is ~$27 million.
  • Cost Cutting: $15M–$20M in annualized reductions identified and substantially implemented, including vendor consolidations and headcount reductions.
  • Hosting Agreement with Foundry: 4,500 miners (~420 PH/s), $60/MWh hosting fee, 50/50 Bitcoin mining profit share. Stronghold retains curtailment rights without penalty.
  • Hash Rate Capacity: Currently at 2.8 EH/s, guiding to 3.0 EH/s in 2023 through additional low-cost miner acquisitions and hosting deals.

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Operator: Good evening, and welcome to Stronghold Digital Mining’s Conference Call for the Third Quarter ended September 30, 2022. My name is Carmen, and I will be your operator this afternoon. Before this call, Stronghold issued its results for the third quarter 2022 in a press release, which is available in the Investors section of the company's website at www.strongholddigitalmining.com. You can find a link to the Investors section at the top of the home page. Joining us on today's call are Stronghold's Co-Chair and CEO, Greg Beard; and CFO, Matt Smith. Following their remarks, we will open the call for questions. Before we begin, Jeff Grampp from Gateway Group, will make a brief introductory statement. Mr. Grampp, please proceed. Jeff Grampp: Thank you, Carmen. Good afternoon, everyone, and welcome. Today's slide presentation, along with our earnings release and financial disclosures were posted to our website earlier today and can be accessed on our website at strongholddigitalmining.com. Some statements we’re making today, may be considered forward-looking statements under securities law and involve a number of risks and uncertainties. As a result, we caution you, that there are a number of factors, many of which are beyond our control, which could cause actual results and events to differ materially, from those described in the forward-looking statements. For more detailed risks, uncertainties, and assumptions relating to our forward-looking statements, please see the

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