DigitalBTC Reports $6.77 Million First Year Net Loss; Management Nonetheless Bullish
DigitalBTC , the Australia-based miner, has reported a first-year net loss of $6.77 million on annual mining revenue of $6.4 million, according to zdnet.com . The company nonetheless claims to be very bullish on bitcoin.
The company, which trades as Digital CC Limited on the Australian Securities Exchange (ASX), reported negative earnings before interest, tax, depreciation, and amortization (EBITDA) of $3.16 million for the full year ending June 2015.
Second Quarter Brought $1.2 Million Loss
In this year’s second quarterly report in late July, DigitalBTC reported $1.2 million in losses. Despite this, the company purchased a total of more than $29.6 million in bitcoins, with $10,116,000 of that being in the second quarter. The company designated the bitcoins for digitalX Direct, the company’s “flagship product” which launched at the end of last year. DigitalX Direct’s purpose is to provide liquidity to institutional users, such as merchants and bitcoin sellers. Previously much of their customer base had been bitcoin trading companies.
According to the second quarterly report, the company had cash reserves of $2.6 million in cash and $1 million in bitcoins.
Management Remains Bullish
In posting its first-year loss, management continues to tell shareholders that its results reflect a “strong performance from the company’s bitcoin operations.” It also claims to have made “significant progress” with AirPocket, an app-based cross currency cash remittance platform for Latin America. In May, CCN.com reported DigitalBTC raised $3.5 million to roll out AirPocket.
“Despite the unfavorable depreciation of the bitcoin price, I am pleased with the growth the company has achieved from its bitcoin trading and mining activities, which continue to provide strong revenue generation,” executive chairman Zhenya Tsvetnenko said in the most recent report.
We have made significant progress during the course of the year towards the development and commercialization (of AirPocket), with a number of agreements in place to accelerate the launch and consumer uptake of the product.
In the current financial year’s first quarter, management told shareholders that while the value of the cryptocurrency fell, the devaluation did not impact its performance.
“Investors should of course remember that movement in the bitcoin price has little bearing on the technology and the digital currency revolution, of which we are a leading participant,” Tsvetnenko said at the time.
Also read: Bitcoin as a medium of exchange: domestic remittances use case
Management Upbeat About DigitalX Direct
The company maintained a positive position about digitalX Direct in its second quarter report, stating:
During the quarter it achieved record sales revenues of $5.5 million (unaudited). This is a significant increase of 45% on the $3.8 million reported in Q1 2015. Since launching the product at the end of 2014 the product has seen steady growth in revenues. […] The customer base has also been shifting to retail bitcoin suppliers and away from professional trading companies, which has led to more consistent daily volumes and higher quarterly revenue.”´
DigitalBTC last year posted an underlying net profit after tax of $600,000 on revenue of $4 million and EBITDA of $2.5 million. While this was the last time the company was in positive territory, FY14 results were based on only a few months of operation. DigitalBTC listed officially in early June 2014 using a reverse takeover of Macro Energy, an investment firm.
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