TORONTO, Aug. 15, 2022 /CNW/ - TAAL Distributed Information Technologies Inc. (CSE: TAAL) (FWB: 9SQ1) (OTC: TAALF) ("TAAL" or the "Company"), a vertically integrated blockchain infrastructure and technology company for enterprises, announces its financial results for the three and six months ended June 30, 2022 ("Q2 2022"). These filings are available for review on the Company's SEDAR profile at www.sedar.com and on the Company's website at www.taal.com/investors. All financial information in this press release is reported in Canadian dollars unless otherwise indicated.
Q2 2022 Highlights
Gross revenue from hashing operations was $7.3 million, a $0.7 million increase from $6.6 million in the second quarter of the prior year ("Q2 2021"). Higher block computing volume was largely offset by a significant decrease in the market value of digital assets.
Adjusted EBITDA was a loss of $4.2 million versus earnings of $0.6 million in Q2 2021.
Cost of revenue was $7.1 million, compared to $2.7 million in Q1 2021, due to the increase in block computing volume.
Loss before operating expenses was $2.4 million, compared to $5.0 million in Q2 2021.
Operating costs totaled $5.6 million, before share-based payments of $6.6 million for a loss from operations of $14.6 million.
Down payments for hashing equipment and hosting provider services exiting the quarter were $29.8 million.
As of June 30, 2022, TAAL had approximately about 56,000 BSV, 6,200 BCH and 4 BTC in coin treasury.
As of June 30, 2022, TAAL had $8.2 million of cash, a $12.9 million long term promissory note, and $37.3 million of working capital.
Operational Update and Q2 2022 Review
On April 5, 2022, TAAL announced it entered into a definitive share purchase agreement (the "Agreement") and completed the sale of the shares of Chief Fuels Inc. ("Chief Fuels") to an established professional property fund (the "Purchaser") for an aggregate cash purchase price of US$24 million. During Q2 2022, and as part of the Agreement, TAAL commenced its oversight and coordination of the facility development project. Upon completion, this roughly 50 MW and 60,000 sq/ft facility in New Brunswick will be a dedicated data center contributing blockchain computing power to support the Web 3.0 services and application partnerships generating transactions through TAAL's software services and interfaces.
During the quarter, the Company continued to monitor and assess the global situation involving Russia, where the Company owns and manages hashing operations. To date, operations have continued, and the Company has successfully engaged with new hosting providers within North America as part of its rebalancing plan which commenced in the first quarter. Subsequent to this reporting period, the Company has announced partnerships with a subsidiary of Luxxfolio and Lake Parime to bring on an additional 400 PH/s of computing power online. This additional computing power, combined with the leased computing powered, creates redundancy, and diversifies the infrastructure within a secure jurisdiction. At the present time, TAAL's operations in Russia are compliant with all international sanctions and are continuing, subject to ongoing risk management assessment.
TAAL's global product and services team continue to develop blockchain infrastructure as a service solution that significantly reduce the complexities for enterprises looking to operate Web 3.0 services and applications. TAAL's 2022 product development roadmap includes, but is not limited to, the deployment of the services such as TAAL API, Node-as-a-service, TAAL Client, Token Studio, and UTXO management services.
"Our transition towards delivering blockchain-as-a-service solutions continues to progress nicely, with more enterprises either developing or enquiring about Web 3.0 applications on the BSV blockchain," said Richard Baker, CEO. "With robust and secure infrastructure, we can accelerate our software and managed services business and enable the next era of global data commerce. In the meantime, our core operations and balance sheet continue to support this transition, and our revenues continue to grow along with our hashing power."
About TAAL Distributed Information Technologies Inc.
TAAL Distributed Information Technologies Inc. delivers value-added blockchain services, providing professional-grade, highly scalable blockchain infrastructure and transactional platforms to support businesses building solutions and applications on the BSV platform, and developing, operating, and managing distributed computing systems for enterprise users. The BitcoinSV blockchain is the world's largest public blockchain by all major utility metrics, data storage, daily transaction volume, scaling ability, and average block size.
For more information please visit – www.taal.com/investors
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
Certain statements included in this news release constitute "forward-looking information" as defined under applicable Canadian securities legislation. The words "will", "intends", "expects" and similar expressions are intended to identify forward-looking information, although not all forward-looking information will contain these identifying words. Specific forward-looking information contained in this news release includes but is not limited to statements regarding: the growth of TAAL's treasury through, among other things, BSV hashing activities; TAAL's future computing power and capacity; development plans for the New Brunswick facility, geopolitical risks to operations and TAAL's business and strategic plans. These statements are based on factors and assumptions related to historical trends, current conditions and expected future developments. Since forward-looking information relates to future events and conditions, by its very nature it requires making assumptions and involves inherent risks and uncertainties. TAAL cautions that although it is believed that the assumptions are reasonable in the circumstances, these risks and uncertainties give rise to the possibility that actual results may differ materially from expectations. Material risk factors include the future acceptance of Bitcoin SV and other digital assets and risks related to information processing using those platforms, the ability for TAAL to leverage intellectual property into viable income streams and other risks set out in TAAL's Annual Information Form dated April 30, 2022, under the heading "Risk Factors" and elsewhere in TAAL's continuous disclosure filings available on SEDAR at www.sedar.com. Given these risks, undue reliance should not be placed on the forward-looking information contained herein. Other than as required by law, TAAL undertakes no obligation to update any forward-looking information to reflect new information, subsequent or otherwise.
SOURCE Taal Distributed Information Technologies Inc.
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