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(Alliance News) - Argo Blockchain PLC on Tuesday reported a swing to an interim profit following the company's "radical" strategy shift.
In the six months to June 30, the cryptocurrency miner posted a maiden pretax profit of GBP942,073 compared to a GBP1.1 million loss the year before.
Argo generated GBP2.9 million in revenue in the first half compared to zero a year before.
The company said the growth came from a "radical change" in the company's strategy, following a "collapse" in cryptocurrency prices in late 2018.
The company said: "In response Argo took a bold and timely decision to pivot from operating a subscription-based mining service aimed at the general public to generating profits by mining for its own account. Importantly, we also continued to invest in a state-of-the art mining platform during the recession in anticipation of an industry upturn which eventually took place from mid-March 2019 onwards."
Closing its consumer unit cut annual mining costs by 35%. Argo also ended its marketing, administrative and customer support expenses. As a result, Argo's administrative expenses in the fist half almost halved to GBP632,175 from GBP1.1 million the year before.
Argo also noted it switched to mining bitcoins from mining alt-coins.
"We have delivered strong growth and maiden profits only a year after the company joined the London stock market as a pre-revenue venture," said Executive Chair Mike Edwards.
"This result validates our decisive action to refocus the business in the light of volatile trading conditions. Our aggressive investment in scaling-up mining capacity, together with favourable industry conditions, provides strong momentum for the second half and our goal to become the world's largest public miner in 2020. Accordingly, the board looks forward to the future with great confidence"
During the first half, Argo committed to buy GBP18 million worth of "mining gear", which will result in the company owning more than 12,000 mining machines by the end of 2019, representing a total hashing capacity of 505 petahash.
The hash rate is the speed at which a computer is completing an operation in Bitcoin code. A higher hash rate is better when mining as it increases the opportunity of finding the next block. One petahash is one quadrillion hashes per second.
Shares in Argo Blockchain were 0.3% lower in London on Tuesday at 9.88 pence each.