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“all we know is that Q4 revenue must be bursting at the seams and profit could well be a lot higher on the strength of Avatar2”

Q4 revenue is not ‘bursting at the seems’ I’m afraid and we do know this as they actually tell us what it is every month ($168m for October and $218m for November - both well short of where it needs to be). They also tell us profit figures each month and they show a $300m loss so far in Q4 ($200m in October and $100m in November). These are facts and can be found in the court docs - we don’t need to guess.

Avatar 2 helps in December but overall domestic box office was only slightly up on November so very probably a loss last month too but we’ll find out for sure in a few weeks.

It will only be when the film slate is close to normal that we’ll see regular profits again. CINE have said this, the creditors know this and so the fact that CINE are still losing money shouldn’t be a big surprise or concern - but let’s not kid ourselves that they are not.

AIG - Galaxy do say they are going to “retain the entire operations team” so I think it is actually explicit that all the staff are transferring. The hosting fees should allow for at least some of that fixed cost though i.e. ARB’s costs won’t simply reduce by the amount that those staff were previously costing.

AIG - It was covered in Galaxy’s announcement of the transaction.

“Helios, which sits on a 160-acre campus, commenced operations in May 2022 and is currently staffed by approximately 40 employees who manage day-to-day operations.”

“Galaxy intends to utilize Helios as its flagship proprietary mining facility and retain the entire operations team.”

https://investor.galaxy.com/news/news-details/2022/Galaxy-To-Acquire-Helios-Bitcoin-Mining-Facility-from-Argo-Blockchain/default.aspx

Huss - I’m just assuming that as time goes on we will keep getting closer to a full film slate so I’m hoping H2 next year will be better than H1 even if the ‘blockbusters’ look better in the first half (haven’t looked myself).

The first half won't be but they already know that and have projected the figures for it. So there is no 'good' or 'bad' news in this I think. We all know (or should know by now) that until the number of films is back to close to pre-covid levels then consistent profits won't return. One or two blockbusters a month are not enough - they've got to be supported by a near full film slate. Hopefully 2023/24 will see that happen!

CINE reported revenues of $218m in November, up by $50m on the previous month (thanks largely to Black Panther). Not enough though to produce a profit but the loss after tax of around $100m was just half that of October's loss of just over $200m.

So results are improving but still some way from profitability. With Avatar December should close the gap a bit more but as Box Office is not that much higher overall than last month it's probably not enough to close it completely.

Total loans and borrowings now appear to be just under $6.2bn.

All figures exclude RoW which sits outside Chapter 11 and so is not included in the monthly reports which can be found in dockets 1179, 1180 and 1181.

But I don't think the reported 97% dilution helps either. Also this $17m was part of the planned $75m of new money from noteholders so just confirms another step in securing those funds.

Chae - I’m not saying they are close to a PPA (I’ve no idea) just that that Galaxy probably has a better chance of getting one than ARB had.

Should have said that in the longer term profitability will be helped by the PPA which sounds like Galaxy have a much better chance of securing than ARB did.

That’s right Wolf, the staff at Helios are being taken on by Galaxy and so staff costs will reduce but the hosting costs will include power plus an element at least for staff costs and a margin.

Impossible to say for certain whether profitability will be better or worse without knowing the terms. My guess is a bit worse, but one thing that is certain, obviously, is that reported profit for this year will be significantly worse because of the large one-off losses created by the transaction and the earlier machine sales.

Net debt? Don't think I've estimated that one! But IF debt is around $75m then net debt would be about $50m assuming they have about $25m of cash now (could be more).

Stnz - As Poor won't give an answer (as usual) this might help:

I think they may have enough to last 12 months. We know they are losing more than $2m per month in cash currently.

It is not unreasonable I think to assume that initially the costs of being hosted at Helios will be at least as much as the current costs of being there (else Galaxy would be making a loss on the deal). Interest should be less but we don't know the rate on the new loan. But a PPA should be in place later and others being hosted there will spread the overheads. Therefore would hope that cash burn would average out no more than $2m per month and maybe less.

So perhaps $24m is the most they need (assuming nothing else changes).

We know they are generating up to $106m of additional cash from the deal (including freeing up the $6m that was restricted with NYDIG) and so this leaves $21m once allowing for the $85m loan repayments.

So about the right amount to last them a year perhaps. BUT...

That's simplistic and obviously it could be much more or less than this depending on many other things including:

BTC price (obviously)
Difficulty levels (obviously)
Whether they achieve more or less savings from the Helios hosting deal including from the PPA
Whether they have more cash on hand (unlikely as they said they had weeks left to survive without funding)
Whether they can get money back on their Intel deposit or on the other hand are committed to more spend
If there are any other Capex plans
etc.

So whilst 12 months I think is a reasonable staring point it's certainly not a guarantee. Could be as little as 6 months or as much as 18 months (or more) before they need more funding.

PI - But I’m not the one that’s been lying. Why do you constantly project your own behaviour onto other people?

I think I’ll take a leaf out of HC’s book as it’s impossible to debate anything logically with someone who isn’t logical, consistent or honest and isn’t prepared to back up anything they say. Think it best just to leave you to tie yourself in knots as nothing you say has any substance or in my view adds any value.

What false narrative?

And you said 12 months was 'guaranteed' - now it's a guesstimate as PW hasn't given any figures? I think that's a good example of a false narrative.

"Argo's electricity cost of mining 1 BTC is $12.4k."

Spot on (for November).

The 'other costs' added up to around $30k per BTC in November though so a very big loss I'm afraid.

"Not stranger then someone de ramping then buying"

I try not to ramp or de-ramp but just give out relevant facts and try to give reasoned estimates and opinions based on those facts. I'd be happy to apologise for any de-ramping I've done i.e. anything where I've either made things up or grossly exaggerated the downside based on the information available. I leave the making things up and exaggerating to the likes of you but if you could point out any examples where I've done this as well then I will gladly put my hand up.

You are right I do not have a high opinion of the company at the moment but I've explained more than once why I am still investing despite this. If you don't get my reasoning then fine.

I'm sorry you are sitting on such a large paper loss. I'm sitting on a loss too just not nearly as much as I don't go all-in on any share but it is still a loss I'd much rather not have and hope disappears. My average is currently double yours though so I have less chance of recovering it (hence one of the reasons for trading it). The difference between us is that I judge the company on the information available and its actions not simply on the fact that I've invested. I was obviously very positive about ARB once but I don't think there are many of us that have been here for over a year that are that positive now. Too many mistakes, too many half-truths and this within a landscape that is much worse (higher difficulty, lower BTC, higher interest rates, more competition, higher costs etc.)

"I don’t want to discuss my finances exactly, too many bitter people. I’ve got a lot of money in ARB a lot more then you think"

But you did tell us exactly how much you have in ARB. £300k at an average of 16p and since you also said that you had very little spare cash this can't have changed much (unless you sold some). Personally I don't care who has how much invested in what (or necessarily believe it) but you've never been shy about talking about your 'investments' or your 'profits' so it's strange that you should suddenly be so coy now.

At least we have analysis. Still waiting for any substance at all to back up any of your random numbers and misleading statements. 15p by close of play yesterday? $35m debt? $20k breakeven? They won't sell Helios? Very strong balance sheet? etc. etc. etc.

"real profit will not be realised until mid 20's (BTC) as a guess"

AIG - I'm afraid mid 40's would be a better guess at the moment.

"Many companies have net liabilities"

Indeed HC and I agree with your point that this isn't necessarily a problem. But, like ARB, my point was simply that in none of these cases can the balance sheet be described as 'very strong' - but agree that a weak balance sheet is much less worrying in some cases than others.