Filing of amended financial statements and management’s discussion and analysis
Revocation of cease trade order (“CTO”) expected shortly
VANCOUVER, British Columbia, Aug. 19, 2019 (GLOBE NEWSWIRE) -- DMG Blockchain Solutions Inc. (DMGI.V) (OTC US: DMGGF) (6AX.F) (“DMG” or the “Company”), announces that as a result of a British Columbia Securities Commission review (the “BCSC”), the Company has amended and re-filed the following filings:
its interim financial statements and management’s discussion and analysis (“MD&A”) for the period ended December 31, 2018;
its annual MD&A for the year ended September 30, 2018; and
its interim MD&A for period ended March 31, 2019,
to provide increased disclosures in the related filings. The material amendments included in the amended filings are described below:
Note 16 of the Company’s interim financial statements for the period ended December 31, 2018 disclosed the general and administrative office expense as a negative figure, which the Company noted resulted as an error due to oversight. As a result of the correction, general and administrative expenses increased by $860,474, foreign exchange loss increased by $447,493, and foreign exchange gain on translation of foreign subsidiary decreased by $7,982 in the condensed interim consolidated statement of profit and loss.
All amended MD&As were amended to reflect increased disclosure regarding the status of the Company’s data centre project, current expenditures to date and anticipated timing and closing costs.
All amended MD&As have been amended to reflect increased disclosure and discussion related to changes between the cost of utilities, bitcoin mining revenue and the Company’s prepaid balances.
The Company’s interim financial statements (Note 14) and MD&A for the period ended December 31, 2018 with respect to the sale of miners were corrected. The MD&A incorrectly stated that miners were sold during the period and that has been amended to remove this wording.
All amended MD&As were amended to reflect a more thorough discussion of the Datient Inc. transaction and the subsequent goodwill impairment.
The Commission is of the view that the Company should disclose the quantity of bitcoins in addition to the fair values presented in the financial statements. As a result, the Company has amended its MD&As to include the quantities of bitcoin in addition to fair values.
The Commission noted deficiencies in the Company’s disclosure of related party transactions. All amended MD&As were amended to specifically identify related persons or entities as described in any related party transaction.
As a result of the CTO, the TSX Venture Exchange (the “TSXV”) suspended trading in the Company’s securities. The Company expects the CTO to be revoked in due course. The Company has also applied to the TSXV for the reinstatement of trading of its common shares.
About DMG Blockchain Solutions Inc.
DMG Blockchain Solutions Inc. is a diversified blockchain and cryptocurrency company that manages, operates and develops end-to-end solutions to monetize the blockchain ecosystem. DMG, with its Blockseer division located in Silicon Valley, intends to be the global leader in industrial scale crypto mine hosting – Mining as a Service (MaaS), crypto mining, blockchain forensics/analytics, and blockchain platform development.
For more information on DMG Blockchain Solutions visit: www.dmgblockchain.com
On behalf of the Board of Directors,
Daniel Reitzik, CEO & Director
For further information, please contact:
DMG Blockchain Solutions Inc.
Investor Relations: John Martin
Toll Free: 1-888-702-0258
Cautionary Note Regarding Forward-Looking Information
This news release contains forward-looking information based on current expectations. Statements about the Company’s plans and intentions, other potential transactions, revocation of the CTO, reinstatement of trading of its common shares, acquisition of customers, product development, events, courses of action, and the potential of the Company’s technology and operations, among others, are all forward-looking information. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such information can generally be identified by the use of forwarding looking wording such as “may”, “expect”, “estimate”, “anticipate”, “intend”, “believe” and “continue” or the negative thereof or similar variations. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including but not limited to, business, economic and capital market conditions; the ability to manage operating expenses, which may adversely affect the Company’s financial condition; the ability to remain competitive as other better financed competitors develop and release competitive products; regulatory uncertainties; access to equipment; market conditions and the demand and pricing for products; the demand and pricing of bitcoins; security threats, including a loss/theft of DMG’s bitcoins; DMG’s relationships with its customers, distributors and business partners; the inability to add more power to DMG’s facilities; DMG’s ability to successfully define, design and release new products in a timely manner that meet customers’ needs; the ability to attract, retain and motivate qualified personnel; competition in the industry; the impact of technology changes on the products and industry; failure to develop new and innovative products; the ability to successfully maintain and enforce our intellectual property rights and defend third-party claims of infringement of their intellectual property rights; the impact of intellectual property litigation that could materially and adversely affect the business; the ability to manage working capital; and the dependence on key personnel. DMG may not actually achieve its plans, projections, or expectations. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the demand for its products, the ability to successfully develop software, that there will be no regulation or law that will prevent the Company from operating its business, anticipated costs, the ability to achieve goals and the price of bitcoin. Given these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements.
The securities of DMG are considered highly speculative due to the nature of DMG’s business.
Factors that could cause actual results to differ materially from those in forward-looking statements include, failure to obtain regulatory approval, the continued availability of capital and financing, equipment failures, lack of supply of equipment, power and infrastructure, failure to obtain any permits required to operate the business, the impact of technology changes on the industry, competition, security threats including stolen bitcoins from DMG or its customers, consumer sentiment towards DMG’s products, services and blockchain technology generally, failure to develop new and innovative products, litigation, increase in operating costs, increase in equipment and labor costs, failure of counterparties to perform their contractual obligations, government regulations, loss of key employees and consultants, and general economic, market or business conditions. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The reader is cautioned not to place undue reliance on any forward-looking information.
The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, the Company undertakes no obligation to comment on the expectations of, or statements made by third parties in respect of the matters discussed above.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.