Member Info for Hexam

It would be a solid business if BTC was well over $40k (and IF difficulty was still at current level). It has a good facility in Helios but at the end of the day a business has got to make profits, not necessarily today, but at least have reasonable prospects of doing so in the future. With ARB there are no such prospects unless BTC skyrockets and a business that is relying on that to happen is not solid at all in my view.

Instead it is a heavily loss-making business, fast running out of cash and in need of a miracle.

I have hedged my bets already as I've sold over half my shares and invested elsewhere - mostly away from crypto.

The rest I've left in case I'm wrong (as any increase in sp will be significant). I really hope in my heart that it's you that is right but my head says not. I would say the probability of survival is maybe 10-30% and even that's probably my heart talking more than my head.

If they could raise 24 million easily surely they would have already done so and certainly before they had to flog their new machines (and potential collateral) at such a heavily discounted price?

It spiked at 9p but soon settled in the 4p-6p range in which it's spent most of the time since. As I say it's just hovering in this kind of range until next big news (or rumour of such news) IMO.

"This is the sequence of events I think will proceed. We will get a Q3 rns, then a directors buying rns and then a loan agreement rns."

I don't see how it wouldn't be classed as insider trading if we got a directors buying RNS before a loan RNS (unless you think there are no loan prospects at all at the moment but directors buys will create some)?

I also cannot see how anybody will lend them money at the moment (see the rate on the loan notes) and so cannot see how you can be certain they are not going bankrupt in the next 12 months. You could be right but no way can you be sure. Paying off the Galaxy Loan was a necessity to create extra free cash (and avoid being chased by the lender - which they may have been already). They are not 'looking' to go bankrupt, they are trying to avoid it and paying off the loan simply bought them an extra month or two perhaps.

"Just because a stock increases, even 150% in a day, doesn't mean to say that's because of anything tangible."

In this case there was something tangible. The rise was in response to the court hearing that agreed the $1.9bn funding thus appeasing the lenders, providing enough cash that should see the company through until the middle of next year and significantly reducing the prospect of full bankruptcy (not just Chapter 11).

Since then the sp as hovered around current levels whilst we await the next piece of big news - whether good or bad.

"why all the stress on here about MAG"

Because he just dominates this board with a mixture of misleading statements and outright lies - and has called just about every genuine LTH a 'short' for simply pointing out his nonsense.

Nothing to do with bulls v bears, just frustration of people wanting to discuss facts in a reasonable, open-minded way rather than be drowned in BS.

Just my view though :)

Possibly - but if BTC falls below the power costs it changes things completely and halting production makes sense (as we saw temporarily at the height of summer for some when power prices rocketed at times).

Even now it can make sense with 'mothballing' as I imagine this could mean significant savings on top of just power costs (e.g. laying off staff). It would be a brave move though as that's a much bigger deal than just turning off machines for a few days. My guess is that they will hold out if at all possible - to the point where they may leave too late. Just a guess though.

"The same will happen soon, whether days, weeks or months, eventually the $17k level will cut too deep".

Yes, when I said "Even at $17k most miners are better off financially by mining rather than not mining" I should have been clear that in both scenarios they are making a loss - just a bigger loss probably if they stop mining completely.

Those with high cash costs or low HODL will be particularly feeling the pinch (unfortunately ARB has both).

I don't think it will be long before we get the next piece of big news about somebody in trouble - and the consequences.

Even at $17k most miners are better off financially by mining rather than not mining. Unless they can offset all the revenue lost by reducing costs (and power alone is not enough for this) then it makes sense to keep going. Some must be close to the tipping point though, but as discussed it's more than just the headline financials that will sway their decision.

Yes, but it always appeared vague to me or just full of the usual jargon - certainly not what I would call concrete. The fact that they have been so quiet about it of late also tells its own story.

I’m afraid not much if anything as I’ve never seen anything concrete in the accounts or anywhere else apart from the HODL.

…the difference when Argo labs came along was that all equivalents held went to them.

Yes they have but as they mine and convert immediately they are included in the mined figure but not the HODL. They’ve always held other coins so there has always been equivalents in the HODL as well.

I thought zcash was immediately converted into BTC - which is why it doesn’t appear in the accounts when listing the equivalents.

"Besides they were using a portion of the HODL for something and there's no HODL left."

Of the 138 BTC left 119 were with Argo Labs. So they only had 19 actual BTC the rest were the equivalents. It will be interesting to see if the 119 equivalents with Argo Labs is also given up this month.

"For me it’s a simple question of maths. $5-6bn of debt. Probably $2-3bn of future lease obligations. Hexam please correct me if you know this as ‘hands up’ I’ve not looked this up but known the total figure is in the region of $9bn."

Wolf - the lease liabilities are a bit higher ($4bn) but if the company comes out of Ch11 then I presume it will still have some debt and be in a position where it can comfortably meet future rents.

So my guesstimate of a $2bn+ business is for one which still has a smaller, servicable debt and the remaining rents are just an ongoing cost to be met like the rest. But it's only a guesstimate based on annual profits of the company being close to those it had pre-pandemic (so $100m-$200m).

You are right it comes down to maths (and sentiment) but the number of scenarios is limitless which is why it is so hard to predict.

“You forgot CINE selling Regal and the Plex court case throwing a wrench on the possibilities.”

I didn’t - it was in the ‘other possibilities’ - of which there are hundreds - I just to tried to keep it simpler by focusing on a few dilution examples.

Personally I think it will be some kind of D4E and hopefully we’ll keep more than 5% of the company but the possibilities are pretty much endless rather than in the hundreds. It’s just a punt for all of us in the end depending on our own view of potential outcomes versus risks.

I bought some today too. For me it's very simple:

Company don't come out of Ch11 (or get completely wiped out doing so) - 0p
Company come out of Ch11 but with very significant dilution (95%) - 5p+
Company come out of Ch11 but with significant dilution (80%) - 20p+
Company come out of Ch11 with no dilution - £1+

But that's just my view based on my own guess at the value of a rescued and revitalised CINE (at least around $2bn) and the odds of each of the above (and other possibilities) happening. It's a gamble though and the ones I bought today I will be hoping to trade sooner at a profit rather than add to my LTH. GLA - whatever odds you favour.

The 3% already has been clawed back - just showing 0.17% now.