IPO impact: Argo Blockchain (LSE: ARB) shares surge over 24%

Summary

  • Argo Blockchain’s shares rose sharply to GBX 107, up by over 24% on 21 July 2021.
  • The company announced filing a draft Registration Statement with the US Securities and Exchange Commission for dual-listing and IPO of American Depositary Shares.
  • Trading is slated to commence in Q3 2021 after completion of SEC review and will be based on market and other conditions.

Argo Blockchain (LSE: ARB), a global leading cryptocurrency miner’s shares surged over 24 per cent on 21 July after the company announced the confidential filing of a Form F-1 Registration Statement with the US Securities and Exchange Commission (SEC) for dual-listing and initial public offering (IPO) of American Depositary Shares (ADS). The offering price range, as well as the number of ADSs remained undisclosed as of now. The trading on Nasdaq is slated to commence in Q3 2021, post completion of SEC review that will be based on market and other conditions.

Argo Blockchain (LON: AZN) share price performance

Argo Blockchain, the London-based Argo Blockchains and boasts of one of the largest and high-efficiency operations powered by clean energy source has also been buzzing due to the rumoured stake acquisition by Tesla (LON: 0R0X). 

Earlier in March 2021, Argo Blockchain collaborated with DMG Blockchain Solutions to develop Terra Pool, the first-of-its-kind Bitcoin mining pool that would be powered using clean energy sources. It offers a sustainable platform for miners to produce cryptocurrencies.

Argo blockchain’s shares were trading at GBX 107.00, up by 24.56 per cent at 15:14 PM GMT. The market capitalisation of the company stood at £327.99 million, and its one-year return is a whopping 2,807.61 per cent.

Argo Blockchain’s financial performance

Argo Blockchain’s revenues for the financial year ended 31 December 2020 stood at £18.96 million, compared to £8.62 million in the previous year, an increase of 120%. The bolstering revenue growth reflected a year-on-year 207% increase to 645 petahash in 2020 from 210 petahash on SHA-256 in 2019, and 280 Megasols in 2020 from 180 Megasols on Equihash in the previous year. Additionally, the company took over two Quebec-based clean energy mining facilities in order to gain more hold over its hosting costs.

The Group posted an increased EBITDA of £7.9 million in 2020 as compared to £1.4 million in 2019. Its pre-tax profit reached £1.4 million in 2020, as against a loss of £0.9 million in the previous year.

Argo Blockchain’s financials also mirror its strategy to pursue continuous investments aimed at developing its mining infrastructure, leveraging competitive hardware prices and improving mining efficiency rates through optimisation of energy costs and machine performance.

This enabled Argo Blockchain to manage cash resources even in a volatile pricing environment for Bitcoin that affected margins for a major part of the year. Nevertheless, in the latter part of the year, Bitcoin prices began to grow from around $12,000 in September to around $29,000 in December and hit $64,870 in mid-April 2021. Although cryptocurrency prices will continue to be volatile, company executives are optimistic that the prices will remain robust, demonstrating the rising acceptance of cryptocurrencies as assets.

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