Member Info for Hexam

"A lot will say 85% of 2019 levels for US admissions when this was a base case forecast. The minimum liquidity covenant test, which would not apply if the Group reached 80% of admission levels for a 3-month comparable period in 2019, was the primary target."

What makes you say this? I would have thought the leverage test was the key target and we know they are still working on dealing with it (either refinancing or waiver).

I think too many people are getting hung up on the base case scenario, not because it wasn't important but because we know they are well behind it and it will soon be consigned to history. There will be a new base case scenario in the upcoming interim results and it will be interesting to see what their revised outlook is and what they think this means for the finances over the next year or so. We can then compare performance against that.

*By DCA I’m referring to averaging down as I assume we are not talking about true DCA here…

DCA is all well and good, most of us probably do it, but each time we do, it just means we were wrong to do it the time before.

Just to be clear, I don't think it will be 190 it is just that others seem to think this number would somehow be OK. It's not. Even if it can all be put down to significant power-offs due to heatwaves then this is actually worse as it suggests such very low numbers will be a recurring feature each summer.

Instead I believe, and certainly hope, that their issues with efficiency will be addressed by the newer machines and using a more reliable mining tool plus boosted further by immersion so that they will be ahead of their peers rather than miles behind. So assuming there has not been really significant down time in July I'm hoping they can start to show some progress and mine 225+.

There may be other news as you say (good or bad) and you make some good points but perhaps the one that most resonates with me is that 'we all have limits'. Jam tomorrow is OK so long as tomorrow eventually arrives and personally for me there needs to some sign of that beginning to happen in the numbers soon.

If it's 190 then I'm cashing in my chips and investing in a miner that knows how to mine.

Agreed Stnz - but that’s why any new machines (presumably another 0.3 EH or so added?) plus any new for old as part of the swap should have a disproportionate impact.

The extra day adds over 3%.
The reduction in difficulty should add another 4 to 5%.
Going from 2.05 average EH to 2.35 average EH should add nearly 15% WITHOUT any impact from being newer machines.

So looking at nearly 25% increase to last month without allowing for any gains in efficiency from the new machines running better, immersion or a better pool. On the downside efficiency could be worse due to longer shutdowns.

On balance though I would hope the efficiency improves so we get more than 25% increase over June figures (assuming they did add another 0.3 EH) - but we’ll soon see.

Stnz - I presume only Helios is weather affected for July which is still less than half of their total hashrate? Also they were affected by shutdowns last month too so how much they increase mining depends on whether the shutdowns are worse than last month or not. The estimate of 220 that I gave effectively assumes a similar level of shutdown.

If it’s worse then the number is likely to be lower but on the other hand they may be getting more out of immersion this month and out of whatever pool they are now in. Plus the new and swapped machines should be more efficient anyway. So it is will be interesting to see exactly where they end up and whilst I’m hoping for more than 220 I agree that as much as 260 is unlikely.

“I understand they may ramp up to 2.5 over the course of the month so it's hard to say but if they had 2.5 for the whole month what would their coins mined be with no shutdowns and good efficiency like some of the other miners? Should it be something like 260?”

If they do ramp up to 2.5 EH by the end of the month the average for the month will be lower - around 2.35 EH assuming the machines come on line steadily throughout the month and I allowed for this in my 220 estimate.

As for the figure if they had good efficiency like some of the other miners (and no shutdowns) then it should be over 300!!

However, it is unrealistic to expect them to improve anywhere near as much as that in a month (and we know there have been shutdowns) so personally I’d be happy with anything that is over 220 BTC as that would indicate to me at least a move in the right direction.

If they’ve got to 2.5EH then with the extra day in July and the small drop in average difficulty then they should hit about 220 BTC given that they mined 179 last month.

Anything north of this and their efficiency is going in the right direction. Anything lower and it means it has got even worse. It should be the former with the shift to newer machines, potentially immersion too and a possible switch of pools. It could go the other way though if they’ve had to switch the power off for any great amount of time.

Will be interesting to see which way it goes.

Jamesy - ARB is still the biggest holding in the fund (13%) followed by CLSK (10%), HIVE and BITF (both 9%).

You’re right, many were lauding it at the time, mainly as an example of institutional investment. My point is that it is not institutional investment really as underlying it is retail money using a institution’s vehicle but agree it’s not to be sniffed at that they chose ARB as the biggest holding. I still don’t think though that governance in the shape of the dual chairman/CEO role would have been high on the selection criteria (and evidently it wasn’t). From memory wasn’t it our green credentials that put us top or am I thinking of a different fund? Like you the dual role is not something I am happy about but it doesn’t keep me awake at night either.

Anyway the fund is $3.7m in total so about half a million in ARB. Welcome but not significant.

Why the Valkyrie ETF in particular? There are several ETFs that contain bitcoin miners now (e.g. BLOK) where the fund is made up of miners and other crypto companies. They are vehicles for retail investors allowing them to access a variety of companies at once (usually less than 10% of the fund is in any single company). How much is invested in ARB is decided by the fund manager if it is an active fund (which I think Valkyrie is) or by a third party if it is an index fund. Either way I don’t see why the dual role would exclude them from the portfolio. It would probably be different if an institution was investing directly into ARB as a direct investment rather than as part of a managed fund for retail investors like these ETFs are.

“Hexam, have a look at revenue and profit expected by analysts..beat on both.”

Thanks sundezena

"results were better than expected" - what was expected?

The only mention against guidance I saw was that capacity was slightly behind and expected to remain so this year.

Overall though I think the results are quite good but not spectacular. Great to see them moving back into profit and that full year should be profitable but not so good on net debt by the end of the year.

Just added some too. To get a cheaper price than last night's close after that update just seemed to me a gift horse I didn't want to look in the mouth. As you say the sp is baffling and whilst I don't subscribe to conspiracy theories about MMs if they are to blame in any way at all then all I can say to them is thank you.

I feel far better about my holding in NEX than I did 24 hours ago as ultimately for LTHs it's the fundamentals that matter (not the transient sp) and they appear to me to have improved markedly with the RNS. But just my view.

"Wow! Nearly a 20p jump and 20p decline over the day. Has to be some foul play somewhere? MMs driving it down to get a PE takeover possibly?"

Or maybe it's simply because plenty of others have top-sliced just like you to take some profit? How would MMs benefit from a PE takeover anyway?

Just a quick peek at the BTC vs NASDAQ chart will show that they are clearly correlated - however, that doesn't mean BTC isn't capable of doing its own thing (e.g. on purely crypto related news). On the other hand when the NASDAQ talks BTC generally listens in my view.

A pump and dump usually happens on speculation or no news at all. This is news and great news at that. A strong growth in revenue, a return to healthy profits, fuel hedged and so are a lot of other costs too via revenue indexation. There may be some pull back from profit taking later on but this all looks very encouraging to me for the longer term sp prospects.

Hard to see it not rising off the back of that update…but we’ll soon find out.

It could be a buy or sell but does it really matter either way? I've never understood people who obsess over individual trades (this one isn't even that big) and there are even some who get excited over UTs (clearly not understanding what they are).

The main thing that should matter to LTHs is how the company is doing as that will ultimately drive what the SP does (plus other big news like a takeover or external factors like the economy). And as far as the company goes that looks pretty good to me at the moment and although I don't expect anything earth-shattering in the H1 results there should be a nice reduction in net debt and further, other signs of continued progress.

In the meantime the obsessives and conspiracy theorists can chunter on about trades and MM 'games'.

They’re not.