Reported for Predecessors HyperBlock Technology Corp. and CryptoGlobal
Company Now Focused on Post-Merger Efficiencies and Launching Crypto Custodial Storage Business
TORONTO, Aug. 30, 2018 /CNW/ - HyperBlock Inc. (CSE: HYPR) — one of North America's largest and most diversified crypto asset enterprises continues to deliver EBITDA positive results — and is focused on managing costs and capitalizing on post-merger efficiencies.
The company has reported second quarter expected EBITDA of approximately CAD$3.0M for its predecessor companies, HyperBlock Technologies Corp, Project Northwest and CryptoGlobal. The combined company ended the quarter with revenue of CAD$10.1M. See financial highlights below.
HyperBlock Inc. formed on July 10, 2018 following the business combination of HyperBlock Technologies Corp., CryptoGlobal and Project Northwest — and recently began trading on the Canadian Securities Exchange under the symbol HYPR.
HyperBlock Well-Positioned to Navigate Challenging Market Conditions
"HyperBlock believes the strength of the company is driven by managing costs and continuing to operate a diversified business," says HyperBlock CEO Sean Walsh, who has been involved in large-scale cryptocurrency mining since 2013.
According to Walsh, HyperBlock is relying on its key advantages to weather tough market conditions:
- Ability to economize on operating expenses, post-merger
- Flexibility to migrate cryptocurrency servers from Canada to Project Northwest, its US datacenter — where approximately 2000 servers have been (or are in the process of) being relocated
- Long-term Project Northwest power agreement with average current pricing of USD 3.3 cents
- Approval to triple US power capacity from 20MW to 60MW
- Diversified mining profit centers — Mining-as-Service hash rate sales, server hosting, self-mining and hardware sales
- HyperBlock proprietary crypto custodial product nearing launch stage
"A continued focus on cost-optimization will help HyperBlock navigate what is becoming a war of attrition that will likely force weaker market participants to cease operations in the months ahead," explains Walsh. "Most important, our team has a long history in the crypto mining market and that experience is critical in anticipating and navigating difficult times," says Walsh.
HyperBlock has begun the first phase of a 20MW upgrade to double capacity at its US datacenter, which has been approved to expand capacity up to 60MW. The company continues to explore low-cost power opportunities in Canada — and is investing in proprietary technology to help the company continue to build a diversified and complete crypto product suite.
The current priority for HyperBlock ongoing R&D investment is an innovative crypto custodial storage solution created for institutional investors. Walsh says the proprietary custodial product is in the final stages of development and HyperBlock expects to launch it later in 2018.
In compliance with securities regulations, the company provided the operating and financial results update for its privately-held predecessor HyperBlock Technologies Corp. and for CryptoGlobal (TSXV: CPTO — acquired by HyperBlock on July 10, 2018), for the three and six month period ended June 30, 2018.
- On a combined basis, HyperBlock Technologies Corp, Project Northwest and CryptoGlobal for the three months ended June 30, 2018, had CAD$3.0M of EBITDA on revenues of CAD$10.1M, including server sales, which accounted for 12% of total revenue.
- On a six month basis, the combined companies generated CAD$9.2 EBITDA on revenue of CAD$19.5M.
- CryptoGlobal posted EBITDA of CDN$285,644 for the quarter. Revenue doubled from CAD$1.6 to CAD$3.2M. The company achieved positive gross mining from operations of 52% and made investments in the development of a proprietary crypto custodial technology.
- Detailed financial statements for HyperBlock Technologies Corp. and CryptoGlobal are available under the company's issuer profile on SEDAR at www.sedar.com under the heading "Financial statements of RTO acquirer." HyperBlock Inc. financial statements (including Project Northwest) will be available on www.sedar.com for the period ending September 30, 2018.
About HyperBlock Inc.
HyperBlock is a leading North American diversified crypto-asset company which operates one of North America's largest and most efficient cryptocurrency datacenters. HyperBlock operates five complimentary product offerings focused on helping people and businesses create, safeguard, manage and grow crypto-assets. HyperBlock profit centers include Mining-as-a-Service (MAAS), self-mining, server hosting, server hardware sales and a proprietary custodial vault product. Learn more at www.hyperblock.co
There are measures included in this news release that do not have a standardized meaning under generally accepted accounting principles (GAAP) and therefore may not be comparable to similarly titled measures and metrics presented by other publicly traded companies. The company includes these measures because it believes certain investors use these measures and metrics as a means of assessing financial performance. EBITDA (earnings before interest, taxes, depreciation and amortization is calculated as net earnings before finance costs (net of finance income), income tax expense, and depreciation and amortization of intangibles) is a non-GAAP financial measure that does not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies.
The significant exchange rates that have been applied includes the following:
June 30th spot rate
Cautionary Note Regarding Forward Looking Information and Future-Orientated Financial Information
This news release contains certain forward-looking information and forward-looking statements within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. These forward-looking statements may not be appropriate for other purposes. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate, among other things, to: information pertaining future financial performance, and information pertaining to strategy and plans, including, but not limited to, expansion of its datacentres in the United States and Canada and the successful launch of the company's crypto custodial product.
These forward-looking statements are based on reasonable assumptions and estimates of management of the company at the time such statements were made. Actual future results may differ materially as forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to materially differ from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors, among other things, include: that market prices will be consistent with expectations, the continued availability of capital and financing, general economic, market and business conditions will be consistent with expectations, fluctuations in general macroeconomic conditions; fluctuations in securities markets; fluctuations in the prices of cryptocurrencies mined by the company; historical prices of cryptocurrencies and the ability of the company to mine cryptocurrencies consistent with historical prices; the ability to retain personnel to execute the company's business plans and strategies; availability of power supply at prices favorable to the business and operations of the company, or at all; higher operating costs; the presence of laws and regulations that may impose restrictions on the ability of the company to operate it business; the speculative nature of cryptocurrency mining and blockchain operations; changes in project parameters as plans continue to be evaluated; and those factors described under the heading "Risks Factors" in the company's listing statement dated July 10, 2018 available on the company's issuer profile on SEDAR. Although the forward-looking statements contained in this news release are based upon what management of the company believes, or believed at the time, to be reasonable assumptions, the company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking statements and information. There can be no assurance that forward-looking information, or the material factors or assumptions used to develop such forward-looking information, will prove to be accurate. The company does not undertake any obligations to release publicly any revisions for updating any voluntary forward-looking statements, except as required by applicable securities law.
For further information: For media and investor inquiries: Debra Quinn, [email protected], 1-800-613.4721