Cipher Mining Provides Third Quarter 2024 Business Update
Completed acquisition of Barber Lake data center site, which includes 250 acres of land in West Texas, a newly constructed high-to-mid voltage substation, approvals for 300 MW, and agreements necessary to participate in the ERCOT market
Completed acquisition of Reveille data center site, which includes approvals for 70 MW and potential to expand to 200 MW, with energization targeted for 2027
Signed option agreements to purchase or lease three sites in Texas with targeted power capacity of 500 MW each, suitable for HPC or bitcoin mining
Third Quarter 2024 Net Loss of $87m, and Adjusted Loss of $3m
NEW YORK, Oct. 31, 2024 (GLOBE NEWSWIRE) -- Cipher Mining Inc. (NASDAQ:CIFR) ("Cipher" or the "Company") today announced results for its third quarter ended September 30, 2024, with an update on its operations and business strategy.
"We had a very busy third quarter, especially on the corporate and business development side," said Tyler Page, CEO. "We were delighted to close our acquisition of the Barber Lake site, which has 300 MW immediately available for energization, and more recently, we also closed on our acquisition of the Reveille site, which is approved for 70 MW and has potential to scale to 200 MW. Looking to the future, we also created a pathway to become one of the largest data center developers in the world by finalizing the purchase of options to acquire three new sites with a total cumulative power capacity of up to 1.5 GW. Cipher's active portfolio and options for development now total 2.5 GW across 10 sites."
"We have made great progress in our discussions with hyperscalers in recent weeks as we seek our first HPC tenants while also continuing to build-out our bitcoin operations with the upgrade of our miner fleet at Odessa. Our operations and construction teams have extensive experience building tier 3 data centers, and we look forward to leveraging their broad skill sets as we expand our scope to bring on our first HPC tenants in the future."
"Despite the headwind of record low hashprices for the bitcoin mining industry in the third quarter, our team delivered another set of solid results. The value of our Odessa power purchase agreement took a significant markdown given the passage of time and the drop in forward market prices for electricity, which contributed to the headline net loss this quarter. On an adjusted basis, our adjusted loss was nearly flat quarter-over-quarter, which we see as a testament to our low-cost unit economics given the known challenges presented to the entire industry in the first full quarter after the bitcoin halving. With our fleet upgrade at Odessa in the fourth quarter, we will be powering an extremely efficient fleet of rigs with industry-low costs for electricity, so we should be well-positioned for brighter bitcoin mining conditions going forward," said Mr. Page.
Finance and Operations Highlights
Completed acquisition of 300 MW Barber Lake data center site
Completed acquisition of 70 MW Reveille data center site, which may be expanded to 200 MW and is well-suited for both HPC or bitcoin mining data centers
Signed options to acquire up to 1.5 GW of new sites in Texas that are also suitable for both HPC or bitcoin mining data centers
Upgrade of Odessa site bringing total self-mining hashrate to ~13.5 EH/s remains on track for Q4 2024
Construction of the 300 MW data center at Black Pearl progressing well, with expected energization in Q2 2025
Q3 2024 net loss of $87 million, or $0.26 per diluted share, and adjusted loss of $3 million, or $0.01 per diluted share
Business Update Call and Webcast
The live webcast and a webcast replay of the conference call can be accessed from the investor relations section of Cipher's website at https://investors.ciphermining.com. To access this conference call by telephone, register here to receive dial-in numbers and a unique PIN to join the call.
About Cipher
Cipher is focused on the development and operation of industrial-scale data centers for bitcoin mining and HPC hosting. Cipher aims to be a market leader in innovation, including in bitcoin mining growth, data center construction and as a hosting partner to the world's largest HPC companies. To learn more about Cipher, please visit https://www.ciphermining.com/.
Forward Looking Statements
This press release contains certain forward-looking statements within the meaning of the federal securities laws of the United States. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Any statements made in this press release that are not statements of historical fact, such as, statements about our beliefs and expectations regarding our future results of operations and financial position, planned business model and strategy, timing and likelihood of success, capacity, functionality and timing of operation of data centers, expectations regarding the operations of data centers, potential strategic initiatives, such as joint ventures and partnerships, and management plans and objectives, are forward-looking statements and should be evaluated as such. These forward-looking statements generally are identified by the words "may," "will," "should," "expects," "plans," "anticipates," "could," "seeks," "intends," "targets," "projects," "contemplates," "believes," "estimates," "strategy," "future," "forecasts," "opportunity," "predicts," "potential," "would," "will likely result," "continue," and similar expressions (including the negative versions of such words or expressions).
These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by Cipher and our management, are inherently uncertain. Such forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such forward looking statements. New risks and uncertainties may emerge from time to time, and it is not possible to predict all risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: volatility in the price of Cipher's securities due to a variety of factors, including changes in the competitive and regulated industry in which Cipher operates, Cipher's evolving business model and strategy and efforts we may make to modify aspects of our business model or engage in various strategic initiatives, variations in performance across competitors, changes in laws and regulations affecting Cipher's business, and the ability to implement business plans, forecasts, and other expectations and to identify and realize additional opportunities. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the "Risk Factors" section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the Securities and Exchange Commission ("SEC"), as any such factors may be updated from time to time in the Company's other filings with the SEC, including without limitation, the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2024. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Cipher assumes no obligation and, except as required by law, does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.
Non-GAAP Financial Measures
This press release includes supplemental financial measures, including Adjusted Earnings (Loss) and Adjusted Earnings (Loss) per share - diluted, in each case , which exclude the impact of (i) the non-cash change in fair value of derivative asset, (ii) share-based compensation expense, (iii) depreciation and amortization, (iv) deferred income tax expense, (v) nonrecurring gains and losses and (vi) the non-cash change in fair value of warrant liability. These supplemental financial measures are not a measurement of financial performance under accounting principles generally accepted in the United Stated ("GAAP") and, as a result, these supplemental financial measures may not be comparable to similarly titled measures of other companies. Management uses these non-GAAP financial measures internally to help understand, manage, and evaluate our business performance and to help make operating decisions. We believe the use of these non-GAAP financial measures can also facilitate comparison of our operating results to those of our competitors.
Non-GAAP financial measures are subject to material limitations as they are not in accordance with, or a substitute for, measurements prepared in accordance with GAAP. For example, we expect that share-based compensation expense, which is excluded from the non-GAAP financial measures, 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. Similarly, we expect that depreciation and amortization will continue to be an expense over the term of the useful life of the related assets. Our non-GAAP financial measures are not meant to be considered in isolation and should be read only in conjunction with our financial statements prepared in accordance with GAAP. We rely primarily on such financial statements to understand, manage and evaluate our business performance and use the non-GAAP financial measures only supplementally.
Contacts:Investor Contact:Josh KaneHead of Investor Relations at Cipher
Media Contact:Ryan Dicovitsky / Kendal TillDukas Linden Public
CIPHER MINING INC.CONDENSED CONSOLIDATED BALANCE SHEETS(in thousands, except for share and per share amounts)(unaudited)
September 30, 2024
December 31, 2023
ASSETS
Current assets
Cash and cash equivalents
$
25,342
$
86,105
Accounts receivable
226
622
Receivables, related party
59
245
Prepaid expenses and other current assets
3,488
3,670
Bitcoin
95,459
32,978
Derivative asset
27,185
31,878
Total current assets
151,759
155,498
Restricted cash
14,392
-
Property and equipment, net
310,699
243,815
Deposits on equipment
144,573
30,812
Intangible assets, net
25,742
8,109
Investment in equity investees
54,973
35,258
Derivative asset
47,225
61,713
Operating lease right-of-use asset
10,564
7,077
Security deposits
15,301
23,855
Other noncurrent assets
210
-
Total assets
$
775,438
$
566,137
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable
$
13,154
$
4,980
Accounts payable, related party
-
1,554
Accrued expenses and other current liabilities
40,764
22,439
Finance lease liability, current portion
3,695
3,404
Operating lease liability, current portion
1,479
1,166
Warrant liability
-
250
Total current liabilities
59,092
33,793
Asset retirement obligation
19,810
18,394
Finance lease liability
8,319
11,128
Operating lease liability
9,662
6,280
Deferred tax liability
6,564
5,206
Total liabilities
103,447
74,801
Commitments and contingencies (Note 13)
Stockholders' equity
Preferred stock, $0.001 par value; 10,000,000 shares authorized, none issued and outstanding as of September 30, 2024, and December 31, 2023
-
-
Common stock, $0.001 par value, 500,000,000 shares authorized, 355,771,238 and 296,276,536 shares issued as of September 30, 2024 and December 31, 2023, respectively, and 347,800,186 and 290,957,862 shares outstanding as of September 30, 2024, and December 31, 2023, respectively
356
296
Additional paid-in capital
870,565
627,822
Accumulated deficit
(198,922
)
(136,777
)
Treasury stock, at par, 7,971,052 and 5,318,674 shares at September 30, 2024 and December 31, 2023, respectively
(8
)
(5
)
Total stockholders' equity
671,991
491,336
Total liabilities and stockholders' equity
$
775,438
$
566,137
CIPHER MINING INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands, except for share and per share amounts)(unaudited)
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
Revenue - bitcoin mining
$
24,102
$
30,304
$
109,047
$
83,423
Costs and operating expenses (income)
Cost of revenue
15,063
13,008
44,164
37,017
Compensation and benefits
14,738
