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TORONTO, May 31, 2021 (GLOBE NEWSWIRE) -- Fortress Technologies Inc. (TSX-V: FORT) (the "Company" or “Fortress”) announces the results of its operations for the first quarter and three months period ended March 31, 2021 (“Q1 2021”). The first quarter of the fiscal year constituted a strong start for the Company, with a net income of approximately $3,700,000 which translates to an earnings per share of $0.05. This period also marked the beginning of a new venture with Great American Mining LLC (“GAM”).
The Company realizes the importance of environmental, social and governance ("ESG") initiatives. As such, the Company has entered into a new partnership with GAM, which specializes in developing and operating environmentally sustainable Bitcoin mining containers which convert vented/flared natural gas into electricity, which reduces greenhouse gas emissions.
The Company has commissioned and paid for 12 containers in its strategic venture with GAM, which are currently under production, and these will operate 2,160 new generation ASIC miners.
The first of twelve containers has been built and is currently being populated with 180 MicroBT ASIC miners, and is expected to be deployed and hashing in the gas fields in the first week of June 2021. This will bring the Company’s total operating Bitcoin mining hashrate to approximately 31 PH/s.
As of May 31, 2021, after the acquisition of the 12 GAM containers and the 180 MicroBT ASIC miners, the Company holds fiat and digital currencies of approximately $21,900,000, including 56.2 Bitcoin.
Production of the subsequent containers is underway. The Company is fully funded to acquire the remaining 1,980 ASIC miners for the remaining 11 containers; Fortress is strategically evaluating opportunities at an attractive $/TH rate, to seek a good return on capital invested. These remaining containers would produce an additional 130-180 PH/s of Bitcoin mining hashrate, in addition to the company’s existing capacity. Upon the deployment of all 12 containers and ASICs, the Company will retain a strong working capital balance for further business opportunities.
Fortress reports the following financial results on its operations for the three months ended March 31, 2021.
Fortress has mined 11.70 Bitcoin for the three months ended March 31, 2021;
As compared to the three months ended December 31, 2021, Fortress has mined 12.21 Bitcoin.
The average Bitcoin mined per day during Q1, 2021 was 0.13, as compared to 0.13 during Q4 2020, 0.15 during Q3 2020, 0.24 during Q2 2020 and 0.31 during Q1 2020.
The average Bitcoin price for the three months ended Q1, 2021 is US$44,847 compared to US$16,655 in Q4, 2020, US$ 10,612 in Q3 2020 US$8,630 in Q2 2020, and US$8,274 for the average Bitcoin price in Q1 2020.
During Q1 2020, the Company generated Bitcoin at a cost of $15,937 (based on quantity of Bitcoin mined divided by incurred monthly cash operating expenses (not including prepaid expenses).
The Company was well capitalized at the end of the quarter with cash and cash equivalents balance of $21,460,773 and digital currencies of $3,685,351. Total assets were $29,339,617, primarily comprised of cash and cash equivalents and Bitcoin.
The Company reported total revenue from the data center operations for the three months ended March 31, 2021 is $644,813, ($264,560 for the three months ended December 31, 2020, $189,723 for the three months ended September 30, 2020, $255,235 for the three months ended June 30, 2020, $316,811 for the three months ended March 31, 2020).
As the Company retained the Bitcoin mined from the data center operations, with the value of Bitcoin at US$58,730, based on the daily quantity of Bitcoin earned during this fiscal quarter, the unrealized gain (or additional gross mining margin) from the data center operation would be US$500,622.
Fortress had a cash and cash equivalents balance of $21,460,773 as at March 31, 2021 compared to cash balance of $7,048,050 as at December 31, 2020. The cash balance increase of $14,412,723 during the three-month period was from the private placement for total gross proceeds of $9,300,000 in exchange for 14,794,700 units of the Company as well as the sale of Bitcoin.
Fortress had a digital currency balance of 49.90 as at March 31, 2021, in addition to the cash balance. Therefore total value of cash, Bitcoin and accrued interest as at March 31, 2021 was $25,221,014 with Bitcoin at a price of US$58,730.
Fortress had cash flow from data center operations of $424,009 during the quarter (which includes proceeds of Gross Mining Margin after prepaid expenses). The Company defines gross mining margin (a non-IFRS measure) as the revenue generated from mining activities less operating costs. Operating costs include monthly cash operating expenses, as well as incidental or accrued expenses. Depreciation, being a non-cash cost, is not deducted to arrive at the gross mining margin. Gross mining margin is a non-standard measure of mining efficiency and should not be considered as a substitute for other IFRS operating and profitability measures of performance.
About Fortress Technologies
Fortress Technologies Inc. (TSX-V: FORT) is a well-capitalized company focused on developing projects where access to growth capital is highly valued, which can also advance ESG and environmentally conscious business initiatives.
For further information, please contact:
Chief Executive Officer
604 477 9997
Trading in the securities of the Company should be considered highly speculative. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains non-IFRS financial measures; the Company believes that these measures provide investors with useful supplemental information about the financial performance of its business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating its business. Although management believes these financial measures are important in evaluating the Company's performance, they are not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with IFRS. These non-IFRS financial measures do not have any standardized meaning and may not be comparable with similar measures used by other companies. For certain non-IFRS financial measures, there are no directly comparable amounts under IFRS. These non-IFRS financial measures should not be viewed as alternatives to measures of financial performance determined in accordance with IFRS. Moreover, presentation of certain of these measures is provided for year-over-year comparison purposes, and investors should be cautioned that the effect of the adjustments thereto provided herein have an actual effect on the Company's operating results.
This news release contains certain “forward-looking information” within the meaning of applicable Canadian securities laws that are based on expectations, estimates and projections as at the date of this news release. The information in this release about future plans and objectives of the Company, are forward-looking information. Other forward-looking information includes but is not limited to information concerning: the establishment and prospects for the Bitcoin mining venture with Great American Mining (“GAM”); the intentions, plans and future actions of the Company, as well as the Company’ ability to successfully mine digital currency; revenue increasing as currently anticipated; the ability to profitably liquidate current and future digital currency inventory; volatility of network difficulty and, digital currency prices and the resulting significant negative impact on the Company’s operations; the construction and operation of expanded blockchain infrastructure as currently planned; and the regulatory environment of cryptocurrency in applicable jurisdictions.
Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking information and are intended to identify forward-looking information.
This forward-looking information is based on reasonable assumptions and estimates of management of the Company at the time it was made, and involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others, risks relating to: there is no assurance that the Company will find a profitable undertaking or that it can successfully conclude a purchase of such an undertaking at all or on terms which are commercially acceptable; the status and impact of new electrical power rates and the status of deliberations by the Grant County Public Utility District; risks relating to the global economic climate; currency exchange risks; the need for the Company to manage its planned growth and expansion; the effects of product development and need for continued technology change; protection of proprietary rights; the effect of government regulation and compliance on the Company and the industry; network security risks; the ability of the Company to maintain properly working systems; reliance on key personnel; global economic and financial market deterioration impeding access to capital or increasing the cost of capital; and, volatile securities markets impacting security pricing unrelated to operating performance. In addition, particular factors which could impact future results of the business of the Company include but are not limited to: failure to identify beneficial business opportunities, failure to convert the potential in the pursued business opportunities to tangible benefits to the Company or its shareholders; the impact of new electrical power rates which could impair profitability and operating performance; deliberations by the Grant County Public Utility District which could limit the ability of the Company to carry on business on a profitable basis or at all; the construction and operation of blockchain infrastructure may not occur as currently planned, or at all; the digital currency market; the ability to successfully mine digital currency; revenue may not increase as currently anticipated, or at all; it may not be possible to profitably liquidate the current digital currency inventory, or at all; a decline in digital currency prices may have a significant negative impact on operations; the volatility of digital currency prices; the anticipated growth and sustainability of hydroelectricity for the purposes of cryptocurrency mining in the Grant County of the State of Washington, the ability to complete current and future financings, any regulations or laws that will prevent the Company from operating its business; the inability to operate the Bitcoin mining venture with GAM on a profitable basis or at all and thereby impairing the investment in the venture. In addition, particular factors which could impact future results of the business of the Company include but are not limited to: the ability to establish the Bitcoin mining venture with GAM on the agreed schedule in accordance with the contract terms and the potential for further improvements to profitability and efficiency across mining operations; the construction and operation of blockchain infrastructure may not occur as currently planned, or at all; expansion may not materialize as currently anticipated, or at all; the digital currency market; the ability to successfully mine digital currency; revenue may not increase as currently anticipated, or at all; it may not be possible to profitably liquidate the current digital currency inventory, or at all; a decline in digital currency prices may have a significant negative impact on operations; an increase in network difficulty may have a significant negative impact on operations; the volatility of digital currency prices; the ability to complete current and future financings; any regulations or laws that will prevent the Company from operating its business; historical prices of digital currencies and the ability to mine digital currencies that will be consistent with historical prices; an inability to predict and counteract the effects of COVID-19 on the business of the Company, including but not limited to the effects of COVID-19 on the price of digital currencies, capital market conditions, restriction on labour and international travel and supply chains; and, there will be no regulation or law that will prevent the Company from operating its business. The Company has also assumed that no significant events occur outside of the Company’s normal course of business. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company undertakes no obligation to revise or update any forward-looking information other than as required by law.