This press release constitutes a “designated press release” for the purposes of the Company’s prospectus supplement dated March 4, 2022 to its short form base shelf prospectus dated February 23, 2022.
TORONTO, June 14, 2022 (GLOBE NEWSWIRE) — Digihost Technology Inc. (“Digihost“or the”Company”) (Nasdaq: DGHI; TSXV: DGHI), an innovative Bitcoin based in the United States (“BTC”) mining company, is pleased to announce that it has reached an agreement (“OK”) with Grede II, LLC to acquire property in the State of Alabama to expand its current operational capability. All currency references are expressed in USD unless otherwise stated.
The terms of the agreement are as follows:
Total purchase price of $2,750,000, of which $1,500,000 is due by June 17, 2022.
The remaining $1,250,000 is to be paid in 25 equal monthly installments of $50,000 per month.
Low cost electricity supply to be purchased from Alabama Power.
The site includes approximately 160,000 square feet of office and industrial warehouse space with initial access to 28 MW of power with a total capacity of 55 MW.
“The company has been looking for opportunities to significantly increase the capacity of our mining operations and diversify jurisdictional risk in an environmentally responsible manner,” said Michel Amar, Digihost’s Chief Executive Officer. “This acquisition ticked all the boxes for Digihost as the company is now able to double its current hash rate through access to clean, renewable energy sources.”
On March 2, 2022, the Company announced the closing of a $10 million secured and secured revolving credit facility (the “Loan facility”). The loan facility provided Digihost with non-dilutive liquidity options to help fund its growth strategy.
The Company is pleased to report that as of today’s date, the fully drawn loan facility has been repaid. Repayment of the loan facility has been completed within the last few weeks and the Company currently has no long-term debt.
Cash and digital inventory
Cash on hand approximately $7.9 million.
Digital inventory, consisting of BTC and Ethereum (“ETH”), of approximately $8.7 million, based on current BTC and ETH prices, respectively.
Total cash and digital inventory of approximately $16.6 million.
“The Company has made a commitment to its shareholders to manage its balance sheet prudently and to repay its outstanding amount by the end of 2022. We are pleased to announce the acceleration of this deadline given the current volatility of the markets” , commented Michel Amar, Chairman and CEO of Digihost. “Current market conditions are challenging, but given the company’s existing cash and digital assets, combined with low overhead, we are able to stay on solid footing while executing our strategy of accessing a low-cost energy.
Commitments of minors
The Company has no outstanding purchase commitments for miners and, in the current environment, will only consider acquisitions of miners on an opportunistic basis.
Digihost is a growth-oriented blockchain technology company primarily focused on BTC mining. Through its self-mining operations and joint venture agreements, the Company currently chops at a rate of approximately 650 PH/s.
All accommodation costs and joint venture profit sharing are treated as operating expenses in the Company’s consolidated financial statements.
For more information, please contact:
Trading in the Company’s securities should be considered highly speculative. No stock exchange, securities commission or other regulatory authority has approved or disapproved of the information contained herein. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Except for statements of historical fact, this press release contains “forward-looking information” and “forward-looking statements” (collectively, “Forward-Looking Information”) that are based on expectations, estimates and projections as of the date of this press release and are covered by safe harbors under the securities laws of Canada and the United States. The forward-looking information contained in this press release includes information on possible further improvements in the profitability and efficiency of mining operations. including, as a result of the Company’s expansion efforts, the Company’s long-term growth potential and the Company’s business goals and objectives. Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to: future capital requirements and the uncertainty of additional financing, including the ability of the Company to use the Company’s market offering program (the “ATM Programme”) and the prices at which the Company may sell ATM Program securities, as well as general capital market conditions; stock dilution resulting from the ATM program and other stock issuances; risks related to the strategy of maintaining and increasing Bitcoin holdings and the impact of Bitcoin price depreciation on working capital; regulatory and other unforeseen issues that prohibit us from declaring or paying our shareholders dividends payable in Bitcoin; the continuing effects of the COVID19 pandemic could have a material adverse effect on the Company’s performance, as supply chains are disrupted and prevent the Company from operating its assets; the development of additional facilities to expand operations in Alabama may not be completed within the timelines anticipated by the Company, if at all; Public Service Commission or other regulatory or board approvals received on a timely basis, or not at all; the acquisition of the facilities in North Tonawanda, New York, closing on time or not at all; ability to access additional power from the local power grid; a decline in cryptocurrency prices, trading volume or, more generally, the profitability of cryptocurrency mining; further improvements in profitability and efficiency may not be realized; the digital currency market; the Company’s ability to successfully mine digital currency on the cloud; the Company may not be able to profitably liquidate its current digital currency inventory, or at all; a decline in digital currency prices could have a material adverse impact on the Company’s operations; digital currency price volatility; and other related risks as more fully described in the Company’s Annual Information Form and other documents disclosed in the Company’s filings on www.sedar.com. The forward-looking information contained in this press release reflects the Company’s current expectations, assumptions and/or beliefs based on information currently available to the Company. In connection with the forward-looking information contained in this press release, the Company has made assumptions about: the current profitability of cryptocurrency mining (including prices and volume of current trading activity); the profitable use of the Company’s assets in the future; the Company’s ability to profitably liquidate its digital currency inventory as needed; historical prices of digital currencies and the Company’s ability to mine digital currencies on the cloud will be consistent with historical prices; the ability to maintain reliable and economical power sources to operate its cryptocurrency mining assets; the negative impact of regulatory changes to energy regimes in the jurisdictions in which the Company operates; the ability to adhere to Digihost’s dividend policy and the timing and amount of dividends based on, among other things, the Company’s results of operations, cash flow and financial condition, capital requirements current and anticipated Digihost Terms and Conditions of Business; and there will be no regulations or laws that prevent the Company from carrying on business. The Company has also assumed that no material event occurs outside of the normal course of business for the Company. Although the Company believes that the assumptions inherent in forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and, accordingly, undue reliance should not be placed on such information due to the inherent uncertainties therein. .