Bitfarms' long-term Bitcoin holdings pay off in 2023

• Bitfarms (TSX:BITF) a global Bitcoin mining stock, earned 446 Bitcoins in December 2023, bringing its total for the year to 4,928
• The price of Bitcoin was up by more than 150 per cent in 2023 to approximately C$56,000
• Bitfarms operates 11 Bitcoin mining farms across Canada, the United States, Paraguay and Argentina
• Bitfarms stock (TSX:BITF) has added approximately 570 per cent year-over-year, but only about 80 per cent since 2019

Bitfarms (TSX:BITF) a global Bitcoin mining stock, earned 446 Bitcoins in December 2023, bringing its total for the year to 4,928.

The December performance is up by 13.8 per cent from November as high uptime and a 465 per cent surge in transaction fees offset a network difficulty increase of 6 per cent for the month.

Network difficulty increased by 103.6 per cent in 2023, while the price of Bitcoin rose by approximately 156.8 per cent, yielding a 61.4 per cent improvement in year-over-year production economics as measured by US/Terahash (TH)/day.

Business highlights for Dec. 2023

• 6.5 Exahash per second (EH/s) online as of Dec. 31, 2023, up by 44 per cent from Dec. 31, 2022, and up by 2 per cent from Nov. 30, 2023. On track to achieve 12 EH/s and 25 Watts/Terahash efficiency (W/TH) fleet efficiency in Q2 2024
• Average of 6.2 EH/s online, up by 5.1 per cent from November 2023
• 71.7 Bitcoin/average EH/s, up by 8 per cent from 66.4 in November 2023
• 446 Bitcoins earned, 13.8 per cent higher than November 2023 and 10.1 per cent lower than December 2022
• 14.4 Bitcoins earned daily on average, representing over US$600,000 per day based on Bitcoin price of US$42,500 (approx. C$56,000) on December 31, 2023
• Sold 444 Bitcoins of the 446 earned, generating proceeds of US$18.9 million
• Bitcoin held in treasury rose to 804, representing about US$34.2 million based on a Bitcoin price of US$42,500 as of December 31, 2023
• Increased Synthetic HODL by 100 long-dated Bitcoin call options to 135 long-dated Bitcoin call options as of December 31, 2023
• Reduced total outstanding debt by US$2 million to a remaining balance of US$4 million as of December 31, 2023, which Bitfarms intends to completely pay off by February 2024
• Held approximately US$84 million in cash and cash equivalents as of December 31, 2023
• Expanded total contracted capacity to 593 MW as of December 31, 2023

Paso Pe, Paraguay, facility

• Finalized contract for additional 20 MW to expand air-cooled warehouse operating capacity from 30 MW to 50 MW, upping total capacity to 70 MW
• Manufactured 80 MW transformer now in transit
• Imminent completion of underground cable connections to the ANDE sub-station

Baie-Comeau, Quebec, facility

• Cleared site for upcoming 11 MW expansion in the second half of 2024 and poured the building’s concrete footings ahead of schedule

Key performance indicators

Bitfarms’ monthly Bitcoin production in 2023

Management commentary

“In 2023, we executed our growth plan and laid the groundwork for aggressive growth in 2024,” Geoff Morphy, Bitfarms’ chief executive officer, said in a statement. “We finished the year with US$118 million in liquidity (up by US$52 million in December), low-cost power contracts for up to 593 MW and a miner purchase agreement for up to 63,888 new Bitmain miners in 2024. Nearly 70 per cent of new miners will be deployed in our existing U.S. and Canadian farms with the remaining miners earmarked for the Paso Pe, Paraguay, expansion, which is currently running ahead of schedule. We are well underway to achieve our Q2 2024 goals of 12 EH/s and 310 MW operating capacity, which would represent increases of 85 per cent and 29 per cent, respectively, compared to year-end 2023. Additionally, we maintain optionality under the contract with the potential to achieve 17 EH/s and 23 W/TH fleet efficiency before the end of 2024.”

“Our mining operations largely kept pace with network hashrate growth in 2023 generating a similar number of Bitcoins year-over-year, while successfully executing on our core focus and strategy to improve balance sheet strength and prepare for the 2024 halving. In 2024, we expect our core focus to be on executing our Bitmain T21 miner fleet upgrade plan and driving rapid improvements in hashrate and energy efficiency in H1 2024,” added Ben Gagnon, Bitfarms’ chief mining officer.

“In 2024, we are building on our financial foundation with a continued focus on effectively utilizing cash flow from operations in our capital efficient growth plan for farm expansion and fleet-wide upgrades,” concluded Jeff Lucas, Bitfarms’ chief financial officer.

Bitfarms is a global Bitcoin mining company. It develops, owns and operates 11 vertically integrated mining farms across Canada, the United States, Paraguay and Argentina.

Bitfarms stock (TSX:BITF) is up by 2.85 per cent, trading at C$3.96 per share as of 11:37 am ET. The stock has added approximately 570 per cent year-over-year, but only about 80 per cent since 2019.

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