Argo Blockchain PLC (ARBK) 2022 Q4 法說會逐字稿

Good afternoon, ladies and gentlemen. Welcome to the Argo Blockchain plc Full Year Results for 2022 Investor Presentation. (Operator Instructions) The company may not be in a position given the attendance on today's call to answer every question it receives during the meeting itself. However, the company can review all questions and would look at those responses and publish them where it's appropriate to do so. Before we begin, we would like to submit the following poll. And if you could give that your kind of attention, I'm sure the company would be most grateful. I'd now like to hand over to Vice President of Investor Relations, Tom Divine. Good afternoon.

女士們先生們，下午好。歡迎來到 Argo Blockchain plc 2022 年投資者演示會的全年業績。 （操作員說明）鑑於出席今天的電話會議，公司可能無法回答在會議期間收到的每一個問題。但是，該公司可以審查所有問題，並會查看這些答复並在適當的時候發布它們。在我們開始之前，我們想提交以下民意調查。如果你能給予你那種關注，我相信公司會非常感激。我現在想交給投資者關係副總裁 Tom Divine。下午好。

Thanks, Mark. Before we begin, I want to remind everyone that today's presentation and remarks may contain forward-looking statements. With us today for a discussion of FY 2022 results are Seif El-Bakly, Argo's interim CEO; and Jim MacCallum, Argo's Chief Financial Officer. And now I'll turn it over to Seif.

謝謝，馬克。在我們開始之前，我想提醒大家，今天的演講和評論可能包含前瞻性陳述。今天與我們一起討論 2022 財年業績的是 Argo 的臨時首席執行官 Seif El-Bakly；以及 Argo 的首席財務官 Jim MacCallum。現在我將把它交給賽義夫。

Thanks, Tom. Thanks, Mark. Hi, everyone. Seif here with my colleague, Jim, who Tom has mentioned, our new CFO. It's great to be virtually presenting to everybody today. So thanks for tuning in. Just want to start off by saying we appreciate everyone's patience.

謝謝，湯姆。謝謝，馬克。大家好。 Seif 和我的同事 Jim 在一起，Tom 提到了他，我們的新任首席財務官。很高興今天能以虛擬方式向所有人展示。感謝收聽。首先要說我們感謝大家的耐心等待。

I know we've been a little quieter than usual since the Galaxy deal, it's mainly because we've been working really hard to clean up house and establish a new solid foundation for Argo and its future success. So again, really appreciate everyone's patience here. I look forward to traveling in the coming months and meeting so many of our stakeholders. So that being said, let's jump right into it.

我知道自從 Galaxy 交易以來我們比往常安靜了一點，這主要是因為我們一直在非常努力地清理內部事務並為 Argo 及其未來的成功奠定新的堅實基礎。所以在這裡再次感謝大家的耐心等待。我期待著在接下來的幾個月裡出差並會見我們的眾多利益相關者。話雖這麼說，讓我們直接進入它。

Perfect. So if you've been following the Bitcoin mining space over the past 2 years, you know that 2022 was a very challenging year for all miners, including Argo. The price of Bitcoin decreased significantly from its highs in late 2021. We saw the digital asset market was already starting to soften in Q1 and then the collapse of Luna, Terra, Three Arrows Capital, Celsius and eventually FTX last year, created even more headwinds for the space and ended up forcing a ton of liquidations and overall deleveraging. Hashprice, the primary measure of profitability for hashrate, saw an even bigger decrease and hit all-time lows in Q4. And that was largely due to the increase in network hashrate despite Bitcoin's price increase and despite the broader macroeconomic environment.

完美的。因此，如果你在過去 2 年一直關注比特幣挖礦領域，你就會知道 2022 年對包括 Argo 在內的所有礦工來說都是極具挑戰性的一年。比特幣的價格從 2021 年底的高點大幅下跌。我們看到數字資產市場在第一季度已經開始走軟，然後去年 Luna、Terra、三箭資本、Celsius 和 FTX 的崩潰造成了更大的阻力對於這個空間，最終迫使大量清算和整體去槓桿化。哈希價格是衡量哈希率盈利能力的主要指標，其跌幅更大，並在第四季度創下歷史新低。這主要是由於儘管比特幣價格上漲且宏觀經濟環境更廣泛，但網絡哈希率仍在增加。

We also saw a ton of disruption in the energy markets given the geopolitical environment. In the U.S., natural gas spike much higher than its historical average, and that resulted in higher electricity prices as well. So all this to say, it was really a perfect storm of headwinds faced by all miners. And hopefully, that will provide some context for our 2022 performance and future strategic position. So for the first half of 2022, we were really focused on completing the construction of Helios and growing our hashrate. We ended up energizing Helios in May and started taking delivery of our new Bitmain S19J Pro machines. Between May and September, we increased our total hashrate capacity by 55% from 1.6x a hash to 2.5. So that was reflected in our overall output.

鑑於地緣政治環境，我們還看到能源市場出現大量混亂。在美國，天然氣價格飆升遠高於歷史平均水平，這也導致電價上漲。所以說這一切，這真的是所有礦工都面臨的一場完美的逆風風暴。希望這將為我們 2022 年的業績和未來的戰略定位提供一些背景信息。因此，在 2022 年上半年，我們真正專注於完成 Helios 的建設並提高我們的算力。我們最終在 5 月為 Helios 注入活力，並開始接收我們新的比特大陸 S19J Pro 機器。從 5 月到 9 月，我們將總哈希率容量從 1.6 倍哈希增加到 2.5 倍，增加了 55%。所以這反映在我們的整體產出中。

And then for our financial results, I'll hand it over to Jim who can give you guys a quick -- a brief recap.

然後關於我們的財務結果，我會把它交給吉姆，他可以給你們做一個快速的簡要回顧。

Great. Thank you, Seif. My first 3 weeks at Argo has primarily focused on the 2022 accounts, assessing the opportunities and meeting the Argo team. I'm looking forward to serving Argo, working with Seif and the management team to grow the business and strengthening our balance sheet. In terms of financial highlights for 2022, we mined 2,156 Bitcoin at an average mining margin of 54%. This translates to an average cost per Bitcoin mined of $12,118 for the year. We generated revenue of $58 million in 2022, which was down 36% from $90 million in 2021. We incurred a net loss of $240 million for 2022. Our net loss was largely driven by some significant nonrecurring items such as the Helios sale transaction loss of $56 million, the $54 million realized loss on previously mined Bitcoin and $61 million of asset impairments.

偉大的。謝謝你，賽義夫。我在 Argo 的前 3 週主要關注 2022 年的賬戶，評估機會並與 Argo 團隊會面。我期待著為 Argo 服務，與 Seif 和管理團隊合作發展業務並加強我們的資產負債表。就 2022 年的財務亮點而言，我們以 54% 的平均挖礦利潤率開采了 2,156 個比特幣。這相當於每年開採每個比特幣的平均成本為 12,118 美元。我們在 2022 年創造了 5800 萬美元的收入，比 2021 年的 9000 萬美元下降了 36%。我們在 2022 年產生了 2.4 億美元的淨虧損。我們的淨虧損主要是由一些重大的非經常性項目造成的，例如 Helios 的銷售交易損失5600 萬美元，之前開采的比特幣實現的 5400 萬美元損失和 6100 萬美元的資產減值。

After adjusting for the nonrecurring items, we generated EBITDA of $1 million compared to $68 million in 2021. Like Seif, I look forward to meeting many of you in the coming weeks and months. And with that, I'll pass it back to Seif.

在對非經常性項目進行調整後，我們的 EBITDA 為 100 萬美元，而 2021 年為 6800 萬美元。和 Seif 一樣，我期待在未來幾周和幾個月內見到你們中的許多人。有了這個，我會把它傳回賽義夫。

Great. Thanks, Jim. I did want to -- and thanks, Mark. We can go to the next slide. I did want to spend a few minutes to give you the high points of the Galaxy transaction that we completed in December 2022. Earlier in my remarks, I addressed some of the challenges we faced in 2022, and that obviously impacted our profitability and ability to generate cash flow. So after evaluating several strategic options, we made the decision to sell Helios facility to Galaxy, who we've known and had a very productive relationship with for some time, and we sold that facility for USD 65 million.

偉大的。謝謝，吉姆。我確實想——謝謝，馬克。我們可以轉到下一張幻燈片。我確實想花幾分鐘時間向您介紹我們在 2022 年 12 月完成的 Galaxy 交易的要點。在我之前的發言中，我談到了我們在 2022 年面臨的一些挑戰，這顯然影響了我們的盈利能力和能力產生現金流。因此，在評估了幾個戰略選擇之後，我們決定將 Helios 設施出售給 Galaxy，我們認識 Galaxy 一段時間以來一直保持著非常富有成效的關係，我們以 6500 萬美元的價格出售了該設施。

That allowed us to pay down our debt by $41 million, which significantly improved our liquidity position. The transaction also enabled us to streamline our operations and reduce our headcount by more than half. Most of these employees were Helios employees who went over to Galaxy. We also secured a 2-year hosting agreement at Helios, where Galaxy hosts our fleet of S19J Pro machines and that's 23,619 machines to be exact. Galaxy is the operator of Helios, manages power procurement, and we pay them a fixed hosting fee based on our machines' actual power usage. Also under the hosting agreement, we get access to Galaxy's PPA power rate as a pass-through cost, and we share proceeds from participating in demand response programs and economic curtailment.

這使我們能夠償還 4100 萬美元的債務，從而顯著改善我們的流動性狀況。該交易還使我們能夠簡化運營並將員工人數減少一半以上。這些員工中的大多數是轉到 Galaxy 的 Helios 員工。我們還在 Helios 獲得了為期 2 年的託管協議，Galaxy 在那里托管了我們的 S19J Pro 機群，準確地說是 23,619 台機器。 Galaxy 是 Helios 的運營商，管理電力採購，我們根據機器的實際用電量向他們支付固定的託管費用。同樣根據託管協議，我們可以使用 Galaxy 的 PPA 電價作為轉嫁成本，並且我們分享參與需求響應計劃和經濟削減的收益。

Next slide, please. As I mentioned, the Galaxy transaction allowed us to pay down debt by $41 million, which enabled us to completely pay down our loans with NYDIG. And with the lower debt balance, our interest expense is now 24% lower, which translated to roughly $3 million in cash flow savings per year. On top of that, with the reduced head count, our G&A expenses are now lower by 44%, and that translated to roughly $5 million in cash flow savings per year. As for the rest of our debt, we'll continue to look for more ways to delever and strengthen our balance sheet in order to reduce what we feel is still a high balance.

請換下一張幻燈片。正如我提到的，Galaxy 交易使我們能夠償還 4100 萬美元的債務，這使我們能夠完全償還 NYDIG 的貸款。由於債務餘額減少，我們的利息支出現在減少了 24%，相當於每年節省大約 300 萬美元的現金流。最重要的是，隨著人數的減少，我們的 G&A 費用現在降低了 44%，這相當於每年節省大約 500 萬美元的現金流。至於我們其餘的債務，我們將繼續尋找更多的方法來去槓桿化和加強我們的資產負債表，以減少我們認為仍然很高的餘額。

Next slide, please. So we came out of 2022 having learned some very, very valuable lessons and with a lot more experience, that's for sure. We're back. We're better equipped for this new version of Argo. The focus since my appointment has been on 4 key pillars: number one is people and retention, number two is financial discipline and cost cutting, number three is operational excellence and number 4 is thinking about future growth and strategic partnerships. So let me start by talking about the first of those pillars, people and retention.

請換下一張幻燈片。因此，我們從 2022 年開始學到了一些非常非常寶貴的經驗教訓，並且積累了更多經驗，這是肯定的。我們回來了。我們為這個新版本的 Argo 做好了更好的準備。自從我上任以來，重點一直放在 4 個關鍵支柱上：第一是人才和保留，第二是財務紀律和削減成本，第三是卓越運營，第四是考慮未來增長和戰略合作夥伴關係。因此，讓我首先談談這些支柱中的第一個，人員和保留。

Next slide, please. At Argo, we have a team of really, really bright and very experienced people. As you can imagine, coming out of last year, the priority for me was to make sure that the team stayed intact. I really wanted to keep the experience that we had in building and operating Helios within the company. It's the closest thing that we have to intellectual property. You're dealing with a team that has planned built, operated and sold a world-class immersion facility and keeping that breadth of knowledge and experience is extremely important and beneficial to the company and its future. So we spent some time thinking about the best organizational structure for the company, and we updated compensation and incentive programs in order to retain our key employees.

請換下一張幻燈片。在 Argo，我們擁有一支非常非常聰明且經驗豐富的團隊。你可以想像，從去年開始，我的首要任務是確保團隊保持完整。我真的很想在公司內部保留我們在構建和運營 Helios 方面的經驗。這是我們擁有的最接近知識產權的東西。您正在與一個計劃建造、運營和銷售世界級沉浸式設施的團隊打交道，保持知識和經驗的廣度對公司及其未來極為重要和有益。因此，我們花了一些時間思考公司的最佳組織結構，並更新了薪酬和激勵計劃以留住我們的關鍵員工。

I'm really happy to say that every employee is now a shareholder, and we did that to better align everyone's interest to the company's success. I'm proud to say that almost all of key employees who plan, build and operated Helios are still here and are still part of the company. I'll say this again until I'm blue in the face, Argo has a really -- has a great platform and a great reputation within the space. Our people live and breathe mining and all of them are hungry and ambitious and well connected with strong relationships within the industry. So it's really no surprise we're getting solicited with some really interesting partnership opportunities with both big and small names.

我真的很高興地說，每個員工現在都是股東，我們這樣做是為了更好地使每個人的利益與公司的成功保持一致。我很自豪地說，幾乎所有規劃、建造和運營 Helios 的關鍵員工都還在這裡，仍然是公司的一部分。我會再說一遍，直到我臉色發青，Argo 確實有一個很棒的平台，並且在該領域享有很高的聲譽。我們的員工以採礦為生，他們都充滿渴望、雄心勃勃，並且在行業內擁有牢固的關係。因此，我們收到一些非常有趣的大公司和小公司的合作機會也就不足為奇了。

And now with the addition of an experienced CFO, such as Jim, as well as some other strategic hires, I really feel we're in a much better place to get Argo back on track. Next slide, please. Thank you. So this brings us to our next pillar of focus, financial discipline. Financial discipline means we're making sure that we're well-capitalized, well-funded and have a solid runway to give us the opportunity to solidify the current foundation. So financial discipline means controlling OpEx and general costs, which we've already reduced since the Galaxy deal and will continue to do so.

現在，隨著吉姆等經驗豐富的首席財務官的加入，以及其他一些戰略性僱員的加入，我真的覺得我們可以更好地讓 Argo 重回正軌。請換下一張幻燈片。謝謝。因此，這將我們帶到了下一個重點支柱，即財務紀律。財務紀律意味著我們要確保我們資本充足，資金充足，並擁有堅實的跑道，讓我們有機會鞏固當前的基礎。因此，財務紀律意味著控制運營支出和一般成本，自從與 Galaxy 交易以來我們已經降低了這些成本，並將繼續這樣做。

It also means maximizing cash flow and strengthening the balance sheet through potential deleveraging and accretive finance while optimizing the mix between equity, debt and cash. I do want to say that we have multiple levers at our disposal, including selling noncore assets and partnering with firms that need Bitcoin mining expertise, that is to potentially use our expertise as a currency. We also have the ability to hedge our production -- our forward production to manage downtime risk, and we'll consider potentially raising equity but only if there's opportunities to invest in projects that will create value and be accretive to our shareholders. So as 2023 continues, mining economics are improving, which is obviously very helpful to our profitability as it allows us to generate more cash flow.

這也意味著通過潛在的去槓桿化和增值融資來最大化現金流並加強資產負債表，同時優化股權、債務和現金之間的組合。我確實想說的是，我們有多種手段可供使用，包括出售非核心資產以及與需要比特幣挖礦專業知識的公司合作，也就是有可能將我們的專業知識用作貨幣。我們也有能力對沖我們的生產——我們的遠期生產以管理停機風險，我們將考慮可能籌集股本，但前提是有機會投資能夠創造價值並為我們的股東增加價值的項目。因此，隨著 2023 年的繼續，礦業經濟正在改善，這顯然對我們的盈利能力非常有幫助，因為它使我們能夠產生更多的現金流。

Next slide, please. Thank you. Next, we have operational excellence as a key pillar, which to me means focusing on yield. Specifically, this means maximizing the return we're getting from our asset base, which is ultimately going to differentiate us from our peers. So we're focused on optimizing our current fleet across Quebec facilities and our miners at Helios, be it machine allocation to space or power. Operational excellence means squeezing as much yield as we possibly can in the most efficient way possible from our miners, while we consider things like settings and conditions, maintenance, uptime and upkeep. We're focused on perfecting our operations and ensuring that we keep our hashrate up. And so we're working aggressively to improve this production metric.

請換下一張幻燈片。謝謝。接下來，我們將卓越運營作為關鍵支柱，對我來說這意味著關注收益。具體來說，這意味著最大化我們從資產基礎中獲得的回報，這最終將使我們從同行中脫穎而出。因此，我們專注於優化我們目前在魁北克設施和我們在 Helios 的礦機的機隊，無論是機器分配到空間還是電力。卓越運營意味著盡可能以最有效的方式從我們的礦工那裡榨取盡可能多的產量，同時我們會考慮設置和條件、維護、正常運行時間和維護等問題。我們專注於完善我們的運營並確保我們保持我們的哈希率。因此，我們正在積極努力改進這一生產指標。

Another aspect of operational efficiency is finding the right balance of machines deployed at Helios versus the ones that are deployed in our Quebec facilities. And that's to say that we will be turning our focus to Quebec as we have the capacity to expand usage there. We'll talk about it in a minute, but we're really excited about the new ePIC miners that are coming in, in early Q3 as we're planning to deploy them in both Baie Comeau and Mirabel. We also have some smaller but exciting projects in Quebec that I'm excited about, such as the Greenhouse pilot that we've been working on with the city of Baie Comeau. Essentially, the concept is to recycle and use waste heat from our facility to grow in vegetables for the local community. We've been working on these projects for years even before my time. So we're excited to share that, that's finally underway. Thank you.

運營效率的另一個方面是找到部署在 Helios 的機器與部署在我們魁北克設施中的機器的正確平衡。這就是說，我們將把重點轉向魁北克，因為我們有能力在那裡擴大使用範圍。我們將在一分鐘內討論它，但我們對即將在第三季度初推出的新 ePIC 礦機感到非常興奮，因為我們計劃在 Baie Comeau 和 Mirabel 部署它們。我們在魁北克也有一些較小但令人興奮的項目，我對此感到很興奮，例如我們一直在與 Baie Comeau 市合作的溫室試點。從本質上講，這個概念是回收和利用我們設施產生的廢熱來為當地社區種植蔬菜。甚至在我出生之前，我們就已經在這些項目上工作了很多年。所以我們很高興分享這一點，這終於在進行中了。謝謝。

So finally, just to quickly talk about our growth strategy. As mentioned, really, our primary focus is about building and maintaining a solid foundation. But having said that, we will explore growth opportunities to maintain our market share as the hashrate network continues to grow. Our baseline criteria is to seek financially viable projects with accretive and compelling returns, which have low CapEx requirements. So we are reviewing projects that utilize wasted or stranded energy as a way to access and secure low power costs. And so when we're thinking about growth opportunities, we're really thinking about innovative opportunities within power and within energy. We will be providing you with updates as we move forward.

最後，快速談談我們的增長戰略。如前所述，實際上，我們的主要重點是建立和維護堅實的基礎。但話雖如此，隨著哈希率網絡的持續增長，我們將探索增長機會以保持我們的市場份額。我們的基準標準是尋求財務上可行的項目，這些項目具有增值和引人注目的回報，並且資本支出要求低。因此，我們正在審查利用浪費或擱淺的能源作為獲取和確保低電力成本的方式的項目。因此，當我們考慮增長機會時，我們實際上是在考慮電力和能源領域的創新機會。隨著我們的前進，我們將為您提供更新。

Next slide, please. Thank you. As I mentioned earlier, we're finally receiving our block miners from ePIC. We'll be installing these machines at our Quebec facilities in early Q3 '23.

請換下一張幻燈片。謝謝。正如我之前提到的，我們終於收到了來自 ePIC 的區塊礦工。我們將在 23 年第 3 季度初在我們的魁北克工廠安裝這些機器。

We're receiving 2,870 machines with an average of 104 terahash per second and 29 joules per terahash inefficiency, and that equates to an aggregate hashrate of about 300 petahash. Once we install those machines, our hashrate capacity will increase from 2.5x hash to 2.8. We had previously mentioned that we were expecting a larger order, representing about 900 petahash. We ended up lowering the size of this order, just to reduce our overall CapEx. But we are excited about deploying those machines in Quebec, nevertheless, and growing our hashrate capacity. These machines do feature the Intel block scale ASIC chips. You may have heard in the last few weeks that Intel is discontinuing its ASIC business, but they will continue to provide service and support as needed throughout the projects. And we're still in touch with the team over there. Next slide, please. Thank you.

我們收到了 2,870 台機器，平均每秒 104 太赫茲和每太赫茲低效 29 焦耳，這相當於總哈希率約為 300 petahash。一旦我們安裝了這些機器，我們的哈希率容量將從 2.5 倍哈希增加到 2.8。我們之前曾提到我們期待更大的訂單，代表大約 900 petahash。我們最終降低了訂單的規模，只是為了減少我們的整體資本支出。但是，我們很高興在魁北克部署這些機器，並增加我們的哈希率容量。這些機器確實配備了英特爾塊級 ASIC 芯片。您可能在過去幾週聽說英特爾將停止其 ASIC 業務，但他們將繼續在整個項目中根據需要提供服務和支持。我們仍然與那邊的團隊保持聯繫。請換下一張幻燈片。謝謝。

So in closing, I'd like to provide a brief update on our progress in Q1 '23. Just to be clear, before getting into it, these figures are preliminary and unaudited. We mined 491 Bitcoin during the quarter, and we generated roughly $11 million of revenue. We finally got a break on natural gas prices, which is translating into more favorable electricity prices in Texas. Argo's average all-in price, which includes power, hosting, sales tax is approximately $0.05 per kilowatt hour, and that translates into a mining margin of roughly 45% to 50%, with an average cost per BTC mined of around $12,000. We're really happy about these power costs. They make a significant difference to our bottom line, as you can imagine. And as mentioned, we've also reduced our G&A spending by 44%, which is roughly $5 million a year, obviously, favorably impacting our bottom line.

因此，最後，我想簡要介紹一下我們在 23 年第一季度的進展情況。需要明確的是，在進入之前，這些數字是初步的，未經審計。我們在本季度開采了 491 個比特幣，產生了大約 1100 萬美元的收入。我們終於在天然氣價格上有所突破，這正在轉化為德克薩斯州更優惠的電價。 Argo 的平均總價（包括電力、託管、銷售稅）約為每千瓦時 0.05 美元，這意味著挖礦利潤率約為 45% 至 50%，平均每個 BTC 的開採成本約為 12,000 美元。我們對這些電力成本感到非常高興。正如您可以想像的那樣，它們對我們的底線產生了重大影響。如前所述，我們還將 G&A 支出減少了 44%，即每年大約 500 萬美元，這顯然對我們的利潤產生了有利影響。

And finally, on a positive note, the macroeconomic environment seemed to have improved as well. BTC is up more than 70% year-to-date. I think, 77% as of this morning and hashrate has been trending upward, too. We will provide you with a more fulsome update on our Q1 '23 earnings that we'll be reporting in the coming weeks. So that's it for us. I appreciate everyone's attention here. Jim and I are happy to answer some of your questions.

最後，從積極的方面來看，宏觀經濟環境似乎也有所改善。 BTC 今年迄今上漲超過 70%。我認為，截至今天早上 77%，哈希率也一直呈上升趨勢。我們將為您提供我們將在未來幾週內報告的 23 年第一季度收益的更全面更新。對我們來說就是這樣。在此感謝大家的關注。吉姆和我很樂意回答您的一些問題。

That's great, Seif, Jim. Thank you very much indeed for updating investors, and I will just bring your cameras back up as well. Ladies and gentlemen, please do continue to submit your questions using the Q&A tab situated on the right-hand corner of your screen. But just wanted the company to just take a few moments to look at those questions submitted already. I'd like to remind you that a recording of this presentation along with a copy of the slides and the published Q&A be accessed via your investor meeting company dashboard.

太好了，賽義夫，吉姆。非常感謝你更新投資者，我也會把你的相機也帶回來。女士們先生們，請繼續使用位於屏幕右上角的“問答”選項卡提交您的問題。但只是希望公司花點時間看看已經提交的那些問題。我想提醒您，可以通過您的投資者會議公司儀表板訪問此演示文稿的錄音以及幻燈片的副本和已發布的問答。

Tom, if I may, if I could just hand back to you to manage the Q&A process, if I could ask you to read out the questions and of course, let the guys give their responses, and then I'll pick up from you at the end.

湯姆，如果可以的話，如果我可以交還給你來管理問答過程，如果我可以請你讀出問題，當然，讓大家給出他們的回答，然後我會接你在最後。

Great. Thanks, Mark. Our first question comes from Chase White at Compass Point. Can you give us some more details on the Helios hosting agreement and the hosting fee you're paying Galaxy?

偉大的。謝謝，馬克。我們的第一個問題來自 Compass Point 的 Chase White。您能否向我們提供更多有關 Helios 託管協議和您向 Galaxy 支付的託管費用的詳細信息？

Sure. Thanks, Chase. So we have a 2-year hosting agreement with Galaxy, and we essentially pay them a pass-through power cost plus hosting fee. So essentially, as I mentioned, we share the economics of demand response and economic curtailment. And as I've mentioned, for Q1 so far, we've paid an all-in cost, including sales tax power and hosting of around $0.05 a kilowatt hour. That's all I can say regarding that.

當然。謝謝，蔡斯。因此，我們與 Galaxy 簽訂了為期 2 年的託管協議，我們基本上向他們支付了轉嫁電費和託管費。所以基本上，正如我提到的，我們共享需求響應和經濟削減的經濟學。正如我所提到的，到目前為止，對於第一季度，我們已經支付了全部成本，包括每千瓦時約 0.05 美元的銷售稅和託管費用。對此我只能說這麼多。

Galaxy is a publicly traded company on their own and they have their own sort of restrictions. But what I can say is that we're absolutely aligned, and we've been working with Galaxy very closely, and we love how they're operating the space. They've been doing a great job, and we're very much aligned with them.

Galaxy 本身就是一家上市公司，他們有自己的限制。但我能說的是，我們完全一致，我們一直在與 Galaxy 密切合作，我們喜歡他們運營空間的方式。他們一直做得很好，我們與他們非常一致。

Great. Next question comes from Alan Howard at Tennyson Securities. Does the cost of power implicit in Q1 reflect a long-term PPA under which Galaxy operates? Or is that also likely to change in the near term?

偉大的。下一個問題來自 Tennyson Securities 的 Alan Howard。 Q1 中隱含的電力成本是否反映了 Galaxy 運營所依據的長期 PPA？或者這也可能在短期內發生變化？

Yes. So thanks, Alan. I think Galaxy on their call has talked a little bit about their power strategy, on their earnings call. And so they've publicly said that they had their power cost at Helios. So under the hosting agreement and pass-through cost structure that we have, we basically benefit from what they do. So again, we're very much in line on that front.

是的。所以謝謝，艾倫。我認為 Galaxy 在他們的電話會議上已經在他們的財報電話會議上談到了他們的權力戰略。所以他們公開表示他們在 Helios 有他們的電力成本。因此，根據我們擁有的託管協議和轉嫁成本結構，我們基本上從他們所做的事情中受益。因此，我們在這方面非常一致。

Great. The next question comes from Darren Aftahi at ROTH MKM. What are Argo's growth and development plans for 2023?

偉大的。下一個問題來自 ROTH MKM 的 Darren Aftahi。 Argo 2023 年的增長和發展計劃是什麼？

So I think -- thanks, Darren. I think for us, we're really thinking, number one, about the foundation of the company and financial discipline. I think that's very critical for us and it's top of mind. We want to delever. We want to have a healthier balance sheet, and that's why we had brought in Jim and some more strategic hires on the finance team. And obviously, we're also thinking about growth opportunities as well. We've had a lot of different discussions. Like the fact -- building and selling Helios was bittersweet. It was obviously better for the obvious reasons, but it was sweet because we had a ton of experience in terms of building a world-class immersion system.

所以我想——謝謝，達倫。我認為對我們來說，我們真正在考慮的是公司的基礎和財務紀律。我認為這對我們來說非常重要，而且是最重要的。我們想去槓桿化。我們希望擁有更健康的資產負債表，這就是為什麼我們在財務團隊中引入了吉姆和一些更具戰略意義的員工。顯然，我們也在考慮增長機會。我們進行了很多不同的討論。正如事實一樣——建造和銷售 Helios 是苦樂參半的。由於顯而易見的原因，它顯然更好，但它也很不錯，因為我們在構建世界級沉浸式系統方面擁有大量經驗。

And we have mostly the same people who have built it within the company. It's part of the reason why I was so bullish on the company and why I took the position when the board tapped me on the shoulder. And we have a lot of relationships within the space, and we have a lot of different types of people and potential partners that are coming at us and talking to us about opportunities of stranded power and opportunities in terms of how we can potentially partner up with utilities and power generators that can give us low cost opportunities. So I think we're open-minded. We're thinking about growth, but we're also thinking about our foundation and cleaning up our balance sheet.

我們在公司內部建立它的人大多是同一個人。這也是我如此看好這家公司的部分原因，也是我在董事會拍拍我肩膀時選擇了這個職位的部分原因。我們在這個領域有很多關係，我們有很多不同類型的人和潛在合作夥伴來找我們，並與我們討論擱淺權力的機會以及我們如何潛在合作的機會可以為我們提供低成本機會的公用事業和發電機。所以我認為我們是開放的。我們正在考慮增長，但我們也在考慮我們的基礎和清理我們的資產負債表。

Thanks, Seif. The next question comes from Jon Petersen at Jefferies. Prior guidance on the ePIC machines was that the block scale chips would provide approximately 900 petahash of hashrate and be installed in the first quarter of 2023. What drove the lower hashrate and the delay in the installs?

謝謝，賽義夫。下一個問題來自 Jefferies 的 Jon Petersen。先前對 ePIC 機器的指導是塊級芯片將提供大約 900 petahash 的哈希率，並在 2023 年第一季度安裝。是什麼導致哈希率較低和安裝延遲？

Yes. So thanks for the question, Jon. Yes, so we ended up -- with everything that was going on last year, we ended up -- there were certain expenses related to the delivery of those machines that we had to sort of push back for cash flow reasons. And so I think that delayed us a little bit. We were aiming for 900 petahash. And I think we made the prudent decision that we would cut cost and it would be a little bit lower. So I think that's what sort of drove the delay. And then as for the efficiency of those machines, I think on average, we're looking at 29 joules per terahash. We've tested them. They're purring. They're running very, very, very well. Our operations team has been testing them for the last few weeks. ePIC has done a phenomenal job with them so far. We like what we're seeing. And so we're really excited about having those machines come online.

是的。謝謝你的問題，喬恩。是的，所以我們最終——隨著去年發生的一切，我們最終——有一些與交付這些機器相關的費用，我們不得不出於現金流的原因而推遲。所以我認為這讓我們有點耽擱了。我們的目標是 900 petahash。而且我認為我們做出了謹慎的決定，即我們將削減成本並且會降低一點。所以我認為這就是導致延遲的原因。然後關於這些機器的效率，我認為平均而言，我們正在尋找每 terahash 29 焦耳。我們已經對它們進行了測試。他們在咕嚕咕嚕。他們運行得非常、非常、非常好。我們的運營團隊在過去幾週一直在測試它們。到目前為止，ePIC 與他們一起完成了非凡的工作。我們喜歡我們所看到的。因此，我們對讓這些機器上線感到非常興奮。

Great. Next question also on the subject of the ePIC machines from Kevin Dede at H.C. Wainwright. Argo is expecting delivery of 2,870 units of the ePIC block miner machines. How does Intel discontinuing its production of the Bitcoin mining chips impact Argo's partnership with ePIC?

偉大的。下一個問題也是關於來自 H.C. 的 Kevin Dede 的 ePIC 機器的主題。溫賴特。 Argo 預計將交付 2,870 台 ePIC 區塊礦機。英特爾停止生產比特幣挖礦芯片對 Argo 與 ePIC 的合作有何影響？

Thanks, Kevin. So short answer is there's really no impact to our relationship with ePIC. ePIC remains -- they have a very smart and innovative team, and they continue to do smart things and be innovative. And then as for Intel, I mean, we're still very much in touch with them, and they're still providing us with support and service throughout the process.

謝謝，凱文。簡短的回答是，我們與 ePIC 的關係確實沒有受到影響。 ePIC 仍然存在 - 他們擁有一支非常聰明和創新的團隊，他們繼續做聰明的事情並進行創新。然後至於英特爾，我的意思是，我們仍然與他們保持著密切聯繫，他們仍然在整個過程中為我們提供支持和服務。

Great. Our next question is submitted by [Byplab P.] What is the latest update on the Pluto investment?

偉大的。我們的下一個問題是由 [Byplab P.] 提交的。冥王星投資的最新進展是什麼？

So yes, we've been speaking with Ian and the team. I think they did a really good thing merging with Maze Theory and establishing their new entity emergent. We're really bullish on their business. I love what they're doing. I still need a little bit of time to get into all the details on what they're doing. But they're building some really, really fun and interesting games obviously related to VR and XR and Web3 and so forth. So we're bullish on the investment. We're shareholders, and we're very supportive of what they're doing. We really like what they're doing. And so we're going to continue working with them and supporting them as one of their key shareholders. So yes, that's really liking what they're doing, and we wish them an amazing year because they have a lot of stuff in the pipeline for this year.

所以是的，我們一直在與伊恩和團隊交談。我認為他們與 Maze Theory 合併並建立了他們的新實體 emergent，這確實是一件好事。我們非常看好他們的業務。我喜歡他們在做什麼。我還需要一點時間來詳細了解他們正在做的事情。但他們正在構建一些非常非常有趣的遊戲，顯然與 VR、XR 和 Web3 等相關。所以我們看好這項投資。我們是股東，我們非常支持他們所做的事情。我們真的很喜歡他們正在做的事情。因此，我們將繼續與他們合作，並支持他們成為他們的主要股東之一。所以，是的，這真的很喜歡他們正在做的事情，我們希望他們有一個美好的一年，因為他們今年有很多東西在籌備中。

Great. Our next question, Alan Howard, Tennyson Securities. When will management be able to focus on a long-term plan for increasing hashrate capacity? And what is the likely shape of that plan?

偉大的。我們的下一個問題，艾倫霍華德，丁尼生證券。管理層何時才能專注於增加哈希率容量的長期計劃？該計劃的可能形式是什麼？

Thanks, Alan. Yes. So I think what we're really focused on is currently just perfecting our operations again in our foundation. And I think we've done a lot in the last 2 months. And so if we can keep the same pace at the same rate, I think our intention is to just get as many things as we can as quickly as possible. And so we are focused on our foundation. We're focused on financial discipline, but we're also planting the seeds and looking at future growth and future production. So I think we're striking a good balance.

謝謝，艾倫。是的。所以我認為我們目前真正關注的是在我們的基礎上再次完善我們的運營。我認為我們在過去 2 個月裡做了很多事情。因此，如果我們能夠以相同的速度保持相同的速度，我認為我們的目的是盡快獲得盡可能多的東西。因此，我們專注於我們的基礎。我們專注於財務紀律，但我們也在播下種子，著眼於未來的增長和未來的生產。所以我認為我們正在取得很好的平衡。

As you can imagine, sort of inheriting this business. There was a lot to do, and there's a lot to work on. We're in a much better place than we were, and I'm really, really happy about that, especially with the team that we have. And so once we have that and we start to delever and we start to get a healthier balance sheet, I think we'll be in a really good position to also continue to grow as well.

可以想像，有點繼承這項業務。有很多事情要做，還有很多工作要做。我們處在一個比以前好多了的地方，對此我真的、真的很高興，尤其是我們擁有的團隊。因此，一旦我們有了它，我們開始去槓桿化，我們開始獲得更健康的資產負債表，我認為我們將處於一個非常好的位置，也將繼續增長。

Great. The next question submitted from a viewer from [Marson M.] Can you shed some more light on how you think about hedging?

偉大的。來自 [Marson M.] 的觀眾提交的下一個問題，您能否進一步說明您如何看待對沖？

Sure. Thanks, Marson. It's a good question. Again, we've come out of last year learning a lot of valuable lessons. And I think hedging was really a key one. We were hedging last year as well. I think this year, when we're thinking about hedging, we're thinking about a portion of our production, ultimately, you're trying to strike a balance between over-hedging because people are essentially buying into a Bitcoin mining company, and they want the exposure to the underlying commodity. And also, we're thinking about how do we do that, so we minimize our downside risk in case Bitcoin prices start to fall or hash price starts to fall, that we still have a good runway in terms of cash flow.

當然。謝謝，馬森。這是個好問題。再一次，我們從去年學到了很多寶貴的經驗教訓。我認為對沖真的是一個關鍵。我們去年也進行了對沖。我認為今年，當我們考慮對沖時，我們考慮的是我們生產的一部分，最終，你試圖在過度對沖之間取得平衡，因為人們基本上是在購買比特幣礦業公司，以及他們想要接觸基礎商品。而且，我們正在考慮如何做到這一點，因此我們將下行風險降至最低，以防比特幣價格開始下跌或哈希價格開始下跌，我們在現金流方面仍有良好的跑道。

And so it's a balancing act between giving investors the exposure that they're essentially buying and minimizing our downside risk and making sure that we have a good enough runway in terms of cash flow. So hopefully, that gives you a little bit of insight. I think we've thought about how to strike that balance, and that's how we're thinking about hedging.

因此，這是在為投資者提供他們本質上正在購買的風險敞口和將我們的下行風險降至最低以及確保我們在現金流方面擁有足夠好的跑道之間的一種平衡行為。所以希望這能給你一點洞察力。我認為我們已經考慮過如何取得這種平衡，這就是我們考慮對沖的方式。

Great. The next question submitted through the chat from [Elia]. Hi, Seif. Great job today and welcome as interim CEO. How does Argo plan to take advantage of the strength of Bitcoin during this ongoing banking crisis? The crypto bull thesis seems to be taking shape in front of our eyes. Does this instill confidence within the Argo team?

偉大的。 [Elia] 通過聊天提交的下一個問題。嗨，賽義夫。今天干得好，歡迎擔任臨時首席執行官。在這場持續的銀行業危機中，Argo 計劃如何利用比特幣的優勢？加密牛市論點似乎正在我們眼前成形。這會給 Argo 團隊帶來信心嗎？

Thanks for the question. I mean, listen, BTC going up is definitely helping, and it's definitely good for our momentum. It's good for energy. It's good for the entire sector. It's good for the industry. What's been happening with the banks is also just creating an even better story for BTC and essentially what BTC were -- what Bitcoin was fundamentally based on. So we're really happy about what's happening. It's looking more and more like a commodity that is an asset class for store value. So I think there's a lot of potential, and we're really excited about the momentum.

謝謝你的問題。我的意思是，聽著，BTC 上漲肯定有幫助，這對我們的勢頭絕對有好處。這對能量有好處。這對整個行業都有好處。這對行業有利。銀行發生的事情也只是為 BTC 創造了一個更好的故事，以及 BTC 的本質——比特幣的根本基礎。所以我們對正在發生的事情感到非常高興。它看起來越來越像一種商品，一種具有存儲價值的資產類別。所以我認為有很大的潛力，我們對這種勢頭感到非常興奮。

And yes, so I appreciate the question, Elia. Thank you. We're liking the thesis. We're liking where things are heading. It's definitely helping us internally. But again, I mean if things could turn the other way for whatever reason, we are thinking about hedging and having a hedging strategy as well, so either way. But definitely having that momentum certainly helps us.

是的，所以我很欣賞這個問題，Elia。謝謝。我們喜歡這篇論文。我們喜歡事情的發展方向。它肯定在內部幫助我們。但是，我的意思是，如果事情出於某種原因可能會轉向另一種方式，我們正在考慮對沖並製定對沖策略，所以無論哪種方式。但肯定有這種勢頭肯定對我們有幫助。

Great. Next question comes from Joe Vafi at Canaccord. You mentioned that you're being solicited for some partnership opportunities. Can you elaborate on the kind of opportunities that you'd be open to at this time?

偉大的。下一個問題來自 Canaccord 的 Joe Vafi。你提到你正在徵求一些合作機會。你能詳細說明你現在願意接受什麼樣的機會嗎？

Yes. Thanks, Joe. I think what's amazing about Bitcoin mining is it has this very unique ability to monetize energy from anywhere in the world. So as an industry and as a company, we're very agile. So we can tap into stranded power that may not have the power lines pushing low downstream. And I think that in itself has some really profound implications for the energy. So when we're looking at opportunities and growth opportunities, we're looking at it from the lens of power, innovation and the energy innovation. And I think we've gone to a point where we're thinking that way and our peers are thinking that way. And if I had to bet, I would definitely bet on that's where the industry is heading as a whole. And those are my expectations, and I think the team is aligned as well. So when we're thinking about partnerships. We're thinking about power generators, we're thinking about utility. We're thinking about folks who are naturally within the space and have access to low power costs.

是的。謝謝，喬。我認為比特幣挖礦的驚人之處在於它具有這種非常獨特的能力，可以將來自世界任何地方的能源貨幣化。因此，作為一個行業和一家公司，我們非常敏捷。因此，我們可以利用可能沒有將電力線推向下游的擱淺電力。我認為這本身對能源有一些非常深遠的影響。因此，當我們尋找機會和增長機會時，我們是從權力、創新和能源創新的角度來看的。而且我認為我們已經到了這樣的地步，我們正在以這種方式思考，我們的同行也在以這種方式思考。如果非要我打賭，我肯定會打賭整個行業的發展方向。這些都是我的期望，我認為團隊也很一致。因此，當我們考慮合作夥伴關係時。我們正在考慮發電機，我們正在考慮公用事業。我們正在考慮那些天生就在這個空間內並且能夠獲得低電力成本的人。

Great. The next question submitted by [Dermot B.] Is there a possibility for an equity raise in the future?

偉大的。 [Dermot B.] 提交的下一個問題是否有可能在未來進行股權融資？

Thanks, Dermot. Yes. So right now, I mentioned that we have some noncore assets that we can tap into in terms of liquidity. I think we're doing a really good job and extracting more yield operationally. So when it comes to operational excellence and bringing that hashrate up, I think it's going to help us with cash flow. I think we're thinking about an equity raise, if it's accretive, if a project basically will give us a higher return than what the cost of our equity is, I think we'd be open to that. I think we would raise equity for very specific reasons. So I think it's important for us as a publicly traded miner to have access to different levers and certainly, equity is one of them, but we're careful about doing that for projects that will add value to the company and be accretive to our bottom line.

謝謝，德莫特。是的。所以現在，我提到我們有一些非核心資產，我們可以在流動性方面利用這些資產。我認為我們做得非常好，並且在運營上獲得了更多收益。因此，當談到卓越運營和提高哈希率時，我認為這將有助於我們的現金流。我認為我們正在考慮股權融資，如果它是增值的，如果一個項目基本上會給我們帶來比股權成本更高的回報，我認為我們會對此持開放態度。我認為我們會出於非常具體的原因籌集股權。因此，我認為，作為一家公開交易的礦工，獲得不同的槓桿對我們來說很重要，當然，股權就是其中之一，但我們對為公司增加價值並增加我們的底部的項目這樣做很謹慎線。

Great. Thanks, Seif. This will be our last question from Alan Howard at Tennyson. Can you talk more about your HODL strategy? Or is there now a non-HODL policy in place?

偉大的。謝謝，賽義夫。這將是我們來自 Tennyson 的 Alan Howard 的最後一個問題。你能談談你的 HODL 策略嗎？或者現在是否有非 HODL 政策？

Yes. Thanks, Alan. I think for now, we are selling our Bitcoin to make sure that we're covering costs and to continue paying off our debt. I think -- obviously, we have a target in mind, and we're going to get to a point, and we're hoping to get to a point where we're going to build that HODL strategy up. But for now, it's really dependent on our working capital needs and our growth prospects. And so that's the way we're thinking about our HODL strategy.

是的。謝謝，艾倫。我認為目前，我們正在出售我們的比特幣以確保我們能夠支付成本並繼續償還我們的債務。我認為 - 顯然，我們心中有一個目標，我們將達到一個目標，我們希望達到一個目標，即我們將建立 HODL 策略。但就目前而言，這實際上取決於我們的營運資金需求和增長前景。這就是我們考慮我們的 HODL 策略的方式。

That's great, Tom. Thank you very much indeed for managing that Q&A session. Thank you also for your engagement this afternoon. I know investor feedback will be particularly important to you, Seif and Jim, and I'll shortly redirect those on the call to give you their feedback. But I wondered if I may, Seif, just before sending investors to give their feedback, if I could ask you just for a few closing comments.

太好了，湯姆。非常感謝您管理該問答環節。也感謝您今天下午的參與。我知道投資者的反饋對你、Seif 和 Jim 來說特別重要，我會很快將電話中的那些人轉給你他們的反饋。但我想知道我是否可以，Seif，就在派投資者提供反饋之前，我是否可以問你一些結束評論。

Sure. Thanks, Mark. So thanks, everyone, for tuning in to discuss our 2022 results and our path forward. We're looking -- we're all working very, very, very hard to execute on the plans that we've laid out, and we absolutely look forward to updating you along the way. So really excited to meet many of you, and thank you again for your patience. Just know that you have an amazing team that's working very, very hard to make sure that we execute on everything that we're -- that we've spoken about today. So thank you, and have a great long weekend to our friends in the U.K.

當然。謝謝，馬克。因此，感謝大家收聽討論我們 2022 年的結果和我們的前進道路。我們正在尋找 - 我們都在非常、非常、非常努力地執行我們制定的計劃，我們絕對期待在此過程中為您提供最新信息。很高興見到你們中的許多人，再次感謝你們的耐心等待。只要知道你有一個了不起的團隊，他們非常非常努力地工作，以確保我們執行我們今天談到的一切。所以謝謝你們，祝我們在英國的朋友們度過一個愉快的長周末。

That's great, Seif, Jim. Thank you very much indeed for updating investors this afternoon. The company is asking investors on the call not to close this session as we'll now automatically redirect you for the opportunity to provide your feedback in order the company can better understand your views and expectations.

太好了，賽義夫，吉姆。非常感謝您今天下午更新投資者信息。該公司要求電話會議的投資者不要結束本次會議，因為我們現在會自動重定向您，讓您有機會提供反饋，以便公司更好地了解您的觀點和期望。

This may take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of Argo Blockchain plc, I would like to thank you for attending today's presentation. Good afternoon to you all.

這可能需要一些時間才能完成，但我相信公司會非常重視它。我代表 Argo Blockchain plc 的管理團隊，感謝您參加今天的演講。大家下午好。