(Alliance News) - Argo Blockchain PLC said Monday it expects its 2019 revenue to be ten times higher than in 2018, the company's maiden year as a bitcoin miner.
For 2019, the London-headquartered cryptominer expects total revenue to reach GBP8.5 million, compared to GBP760,000 in 2018.
In the fourth quarter of 2019, Argo produced 432 bitcoins from its cryptomining operations compared with 426 in the third quarter, resulting in revenue of GBP2.7 million compared with GBP3.6 million in the previous quarter.
"The lower quarterly revenue is attributable to a drop in cryptocurrency prices, increased mining difficulty, and unfavourable foreign exchange rates towards the end of the year," Argo explained.
Argo hit a mining margin of about 52% in the final quarter, down from 73% in the third quarter. The lower margin was also blamed on falling bitcoin prices, a rise in mining difficulty and network hash rates.
Since the year end, Argo said it is ahead of schedule with the rapid expansion of its installed production capacity, which currently stands at 13,364 machines. This includes 6,375 new generation Bitmain Antminer T17s delivered and installed since the beginning of this month. The company also remains on track to install 3,625 more T17s machines by the end of the first quarter of 2020, with the goal of establishing a total production base of 17,000 machines.
Argo said its installed machines currently produce 380 petahash. Following the installation of the final 3,625 machines, the company expects to generate more than 650 petahash.
A hash rate is an indicator of a network's health, with a hash being part of a calculation that is needed to verify a bitcoin transaction.
Chief Executive Peter Wall said: "Thanks to a resilient performance in the last quarter, Argo delivered annual revenues of approximately GBP8.5 million in 2019, our maiden operational year when we commenced mining at scale only in the second half."
"Our mining operations continued to generate industry-best mining margin in the last quarter despite a softening in market conditions from the previous quarter. Our state-of-the-art mining platform is performing as expected and with the expansion of our mining network on pace, along with the recent rise with the price of Bitcoin, Argo is well-placed for a strong year ahead."
Shares in Argo Blockchain were flat in London on Monday at 7.05 pence each.
By Paul McGowan; firstname.lastname@example.org
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