CleanSpark Reports Second Quarter FY2024 Financial Results

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May 9, 2024 9:00 AM EDT

FY2024 Second Quarter Revenue of $111.8 million, net income of $126.7 million and Adjusted EBITDA of $181.8 million

Revenue grows 163% YoY 

Current hashrate surpasses 17 EH/s 

LAS VEGAS, May 9, 2024 /PRNewswire/ -- CleanSpark, Inc. (Nasdaq: CLSK) (the "Company"), America's Bitcoin Miner™, today reported financial results for the three months ended March 31, 2024. The Company will hold its earnings call today at 1:30 p.m. PT / 4:30 p.m. ET.

"We've achieved remarkable milestones this past quarter, ultimately becoming what we believe to be the top operator at scale in the industry, as we increased our operational capacity by over 60%, extended our footprint with new facilities in Mississippi and Georgia, and bolstered our total capacity to over 17 EH/s," said Zach Bradford, CEO. "These efforts have driven a significant rise in our revenue, underscoring the effectiveness of our strategic initiatives and targeted growth. As we press ahead, our focus remains on innovation, measured growth, and strengthening our unique position in the market to deliver sustained value to our shareholders. Our commitment is not only to today's success but to fostering a resilient and thriving future for all our stakeholders."

"The second quarter was record breaking and historic for CleanSpark, as we recognized approximately $112 million of revenue," said Gary A. Vecchiarelli, CFO. "Our margins have also increased over the preceding first quarter which were helped by the rise in bitcoin prices and expanded margins. At our wholly owned sites, we experienced wholesale power costs as low as 1.3 cents per kilowatt hour, and a very favorable all-in power cost of 4.3 cents per kilowatt hour. We also ended the quarter with almost $700 million in cash and bitcoin, and virtually no debt, which put us in a strong position for the halving and will allow us to take advantage of opportunities the halving presents."

Q2 Financial Highlights

Financial Results for the Three Months Ended March 31, 2024

  • The Company increased its quarterly revenues to $111.8 million, an increase of $69.3 million, or 163% from $42.5 million for the same prior year period.
  • Net income for the three months ended March 31, 2024, was $126.7 million or $0.59 basic income per share compared to a loss of ($18.5) million or ($0.23) loss per share for the same prior year period.
  • Adjusted EBITDA1 increased to $181.8 million, increasing from $12.7 million in the same prior year period.

Balance Sheet Highlights as of March 31, 2024

Assets

  • Cash: $323.1 million
  • Bitcoin: $358.0 million
  • Total Current assets: $687.8 million
  • Total Mining assets (including prepaid deposits & deployed miners): $623.1 million
  • Total Assets: $1.54 billion

Liabilities and Stockholders' Equity

  • Current Liabilities: $55.0 million
  • Total Liabilities: $74.4 million
  • Total Stockholders' Equity: $1,462.9 million

The Company had working capital of $632.7 million and $12.8 million of debt as of March 31, 2024.

Investor Conference Call and Webcast 
The Company will hold its second quarter FY2024 earnings presentation and business update for investors and analysts today, May 9, 2024, at 1:30 p.m. PT / 4:30 p.m. ET. Webcast URL: https://investors.cleanspark.com. 

The webcast will be accessible for at least 30 days on the Company's website and a transcript of the call will be available on the Company's website following the call.

About CleanSpark

CleanSpark (Nasdaq: CLSK) is America's Bitcoin Miner™. We own and operate data centers that primarily run on low-carbon power. Our infrastructure responsibly supports Bitcoin, the world's most important digital commodity and an essential tool for financial independence and inclusion. We cultivate trust and transparency among our employees and the communities we operate in. Visit our website at www.cleanspark.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In this press release, forward-looking statements include, but may not be limited to, statements regarding the Company's expectations, beliefs, plans, intentions, and strategies. In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "targets," "projects," "contemplates," "believes," "estimates," "forecasts," "predicts," "potential" or "continue" or the negative of these terms or other similar expressions. The forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to: strategic targets of management; the risk that the electrical power available to our facilities does not increase as expected; the success of its digital currency mining activities; the volatile and unpredictable cycles in the emerging and evolving industries in which we operate; increasing difficulty rates for bitcoin mining; bitcoin halving; new or additional governmental regulation; the anticipated delivery dates of new miners; the ability to successfully deploy new miners; the dependency on utility rate structures and government incentive programs; dependency on third-party power providers for expansion efforts; the expectations of future revenue growth may not be realized; and other risks described in the Company's prior press releases and in its filings with the Securities and Exchange Commission (SEC), including under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2023, and any subsequent filings with the SEC. Forward-looking statements contained herein are made only as to the date of this press release, and we assume no obligation to update or revise any forward-looking statements as a result of any new information, changed circumstances or future events or otherwise, except as required by applicable law.

Non-GAAP Measure

The Company presents adjusted EBITDA, which is not a measurement of financial performance under generally accepted accounting principles in the United States("GAAP"). The Company's non-GAAP "Adjusted EBITDA" excludes (i) impacts of interest, taxes, and depreciation; (ii) the Company's share-based compensation expense, unrealized gains/losses on securities, and, changes in the fair value of contingent consideration with respect to previously completed acquisitions, all of which are non-cash items that the Company believes are not reflective of the Company's general business performance, and for which the accounting requires management judgment, and the resulting expenses could vary significantly in comparison to other companies; (iii) non-cash impairment losses related to long-lived assets (including goodwill); (iv) realized gains and losses on sales of equity securities, the amounts of which are directly related to the unrealized gains and losses that are also excluded; (v) legal fees related to litigation and various transactions, which fees management does not believe are reflective of the Company's ongoing operating activities; (vi) gains and losses on disposal of assets, the majority of which are related to obsolete or unrepairable machines that are no longer deployed; (vii) gains and losses related to discontinued operations that would not be applicable to the Company's future business activities; and (viii) severance expenses. The Company previously excluded non-cash impairment losses related to digital assets and realized gains and losses on sales of bitcoin from our calculation of adjusted EBITDA, but has determined such items are part of the Company's normal ongoing operations and will no longer be excluding them from our calculation of adjusted EBITDA.

Management believes that providing this non-GAAP financial measure that excludes these items allows for meaningful comparisons between the Company's core business operating results and those of other companies, and provides the Company with an important tool for financial and operational decision making and for evaluating its own core business operating results over different periods of time. In addition to management's internal use of non-GAAP adjusted EBITDA, management believes that adjusted EBITDA is also useful to investors and analysts in comparing the Company's performance across reporting periods on a consistent basis. Management believes the foregoing to be the case even though some of the excluded items involve cash outlays and some of them recur on a regular basis (although management does not believe any of such items are normal operating expenses necessary to generate our bitcoin related revenues). For example, the Company expects that share-based compensation expense, which is excluded from adjusted EBITDA, will continue to be a significant recurring expense over the coming years and is an important part of the compensation provided to certain employees, officers, and directors. Additionally, management does not consider any of the excluded items to be expenses necessary to generate the Company's bitcoin related revenue.

The Company's adjusted EBITDA measure may not be directly comparable to similar measures provided by other companies in our industry, as other companies in the Company's industry may calculate non-GAAP financial results differently. The Company's adjusted EBITDA is not a measurement of financial performance under GAAP and should not be considered as an alternative to operating (loss) income or any other measure of performance derived in accordance with GAAP. Although management utilizes internally and presents adjusted EBITDA, the Company only utilizes that measure supplementally and does not consider it to be a substitute for, or superior to, the information provided by GAAP financial results.

Accordingly, adjusted EBITDA is not meant to be considered in isolation of, and should be read in conjunction with, the information contained in the Company's Consolidated Financial Statements, which have been prepared in accordance with GAAP. 

CLEANSPARK, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except par value and share amounts)




March 31,
2024



September 30,
2023




(Unaudited)





ASSETS







Current assets







Cash and cash equivalents, including restricted cash


$

323,052



$

29,215


Accounts receivable, net



—




5


Inventory



991




809


Prepaid expense and other current assets



4,134




12,034


Bitcoin (See Note 2 and Note 5)



357,981




56,241


Derivative investment asset



505




2,697


Investment in debt security, AFS, at fair value



784




726


Current assets held for sale



324




445


Total current assets


$

687,771



$

102,172









Property and equipment, net


$

670,510



$

564,395


Operating lease right of use asset



228




688


Intangible assets, net



3,736




4,603


Deposits on miners and mining equipment



161,309




75,959


Other long-term asset



5,718




5,718


Goodwill



8,043




8,043


Total assets


$

1,537,315



$

761,578









LIABILITIES AND STOCKHOLDERS' EQUITY







Current liabilities







Accounts payable and accrued liabilities


$

43,632



$

65,577


Current portion of operating lease liability



177




181


Current portion of finance lease liability



52




130


Current portion of long-term loans payable



7,686




6,992


Dividends payable



2,842




—


Current liabilities held for sale



637




1,175


Total current liabilities


$

55,026



$

74,055


Long-term liabilities







Operating lease liability, net of current portion



431




519


Finance lease liability, net of current portion



—




9


Loans payable, net of current portion



5,090




8,911


Deferred income taxes



13,851




857


Total liabilities


$

74,398



$

84,351


Stockholders' equity







Common stock; $0.001 par value; 300,000,000 shares authorized; 225,469,791
and 160,184,921 shares issued and outstanding, respectively



225




160


Preferred stock; $0.001 par value; 10,000,000 shares authorized; Series A shares;
2,000,000 authorized; 1,750,000 and 1,750,000 issued and outstanding, respectively



2




2


Additional paid-in capital



1,641,643




1,009,482


Accumulated other comprehensive income



284




226


Accumulated deficit



(179,237)




(332,643)


Total stockholders' equity



1,462,917




677,227









Total liabilities and stockholders' equity


$

1,537,315



$

761,578

 


 

CLEANSPARK, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited, in thousands, except per share and share amounts)



For the three months ended



For the six months ended




March 31,
2024



March 31,
2023



March 31,
2024



March 31,
2023


Revenues, net













Bitcoin mining revenue, net


$

111,799



$

42,488



$

185,585



$

70,234


Other services revenue



—




58




—




131


Total revenues, net


$

111,799



$

42,546



$

185,585



$

70,365















Costs and expenses













Cost of revenues (exclusive of depreciation and amortization shown below)



34,298




22,082




63,194




42,498


Professional fees



2,208




3,750




3,780




6,581


Payroll expenses



16,820




9,750




32,141




19,552


General and administrative expenses



6,819




4,329




11,822




8,053


Loss on disposal of assets



1,652




3




2,329




3


Gain on fair value of bitcoin, net (see Note 2 and Note 5)



(119,702)




—




(155,743)




—


Other impairment expense (related to bitcoin)



—




194




—




277


Impairment expense - other



396




—




396




—


Realized gain on sale of bitcoin



—




(1,422)




—




(905)


Depreciation and amortization



32,187




21,346




62,034




40,675


Total costs and expenses


$

(25,322)



$

60,032



$

19,953



$

116,734















Income (loss) from operations



137,121




(17,486)




165,632




(46,369)















Other income (expense)













Other income



—




11




—




11


Change in fair value of contingent consideration



—




—




—




485


Unrealized (loss) gain on derivative security



(949)




56




(2,192)




(1,215)


Interest income



2,684




52




3,270




122


Interest expense



(526)




(799)




(1,072)




(1,688)


Total other income (expense)


$

1,209



$

(680)



$

6



$

(2,285)















Income (loss) before income tax expense



138,330




(18,166)




165,638




(48,654)


Income tax expense



11,595




—




12,994




—


Income (loss) from continuing operations


$

126,735



$

(18,166)



$

152,644



$

(48,654)















Discontinued operations













(Loss) income from discontinued operations


$

—



$

(294)



$

—



$

1,163


Income tax expense



—




—




—




—


(Loss) income on discontinued operations


$

—



$

(294)



$

—



$

1,163















Net income (loss)


$

126,735



$

(18,460)



$

152,644



$

(47,491)















Preferred stock dividends



2,842




—




3,421




—















Net income (loss) attributable to common shareholders


$

123,893



$

(18,460)



$

149,223



$

(47,491)















Other comprehensive income



29




29




58




58















Total comprehensive income (loss) attributable to common shareholders


$

123,922



$

(18,431)



$

149,281



$

(47,433)


 

CLEANSPARK, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Continued)
(Unaudited, in thousands, except per share and share amounts)



For the three months ended



For the six months ended




March 31,
2024



March 31,
2023



March 31,
2024



March 31,
2023


Income (loss) from continuing operations per common
share - basic


$

0.59



$

(0.23)



$

0.77



$

(0.66)















Weighted average common shares outstanding - basic



209,287,089




80,469,471




193,964,904




73,450,877















Income (loss) from continuing operations per common
share - diluted


$

0.58



$

(0.23)



$

0.76



$

(0.66)















Weighted average common shares outstanding - diluted



212,099,068




80,469,471




196,903,594




74,032,082















(Loss) income on discontinued operations per common
share - basic


$

-



$

(0.00)



$

-



$

0.02















Weighted average common shares outstanding - basic



209,287,089




80,469,471




193,964,904




73,450,877















(Loss) income on discontinued operations per common
share - diluted


$

-



$

(0.00)



$

-



$

0.02















Weighted average common shares outstanding - diluted



212,099,068




80,469,471




196,903,594




74,032,082


 

CLEANSPARK, INC.

RECONCILIATION OF ADJUSTED EBITDA
(Unaudited, in thousands)



Three Months Ended March 31,




2024



2023


Net income (loss)


$

126,735



$

(18,460)


Adjustments:









Loss on discontinued operations


$

—



$

294


Impairment expense - other



396




—


Depreciation and amortization



32,187




21,346


Share-based compensation expense



9,797




5,743


Unrealized loss (gain) on derivative security



949




(56)


Interest income



(2,684)




(52)


  Interest expense



526




799


  Loss on disposal of assets


1,652



3


  Income tax expense


11,595



—


  Other2


676



3,104


Total Adjusted EBITDA


$

181,829



$

12,721











Three months ended

December 31, 2023




Revenues, net






Digital currency mining revenue, net


$

73,786




Other services revenue



—




Total revenues, net


$

73,786










Net income


$

25,909




Adjustments:







Depreciation and amortization



29,847




Share-based compensation expense



9,953




  Unrealized loss on derivative security



1,243




  Interest income


(586)




  Interest expense


546




  Loss on disposal of assets


677




  Income tax expense


1,399




  Other2


102




Total Adjusted EBITDA


$

69,090

























We have not excluded our net gain on fair value of bitcoin ($36,041 and $119,702 in the quarters ended March 31, 2024 and
December 31, 2023, respectively), which we now record in our statement of operations, as provided for in ASC 350-60 and as
discussed elsewhere in our Form 10-Q.

2 Includes fees and expenses related to litigation, settlements, financing & business development transactions.

Investor Relations Contact
Brittany Moore
702-989-7693
[email protected]

Media Contact
Eleni Stylianou
702-989-7694
[email protected]

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/cleanspark-reports-second-quarter-fy2024-financial-results-302140968.html

SOURCE CleanSpark, Inc.


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