Good afternoon and welcome to the Argo Blockchain plc Q1 2023 Results Investor Presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged and can be submitted at any time by the Q&A tab situated on the right hand corner of your screen. Just simply type in your questions and press send. The company may not be in position to answer every question it received in the meeting itself. However, the company will review your questions later today and publish responses where it's appropriate to do so. Before we begin, I'd like to submit the following poll. I would now like to hand you over to Tom Divine, Vice President of Investor Relations. Good afternoon, sir.

Thanks Alexandro. Before we begin, I would like to remind everyone that today's presentation and remarks may contain forward-looking statements. For our full risk factors, please see our Form 20-F filed with the Securities and Exchange Commission for the year 2022. I'd also like to point out that in our Q1 earnings and going forward, we will be reporting our financial results in U.S. dollars. With us today for our discussion of Q1 2023 results are Seif El-Bakly, Argo's Interim Chief Executive Officer; and Jim MacCallum, Argo's Chief Financial Officer. And now, I'll turn it over to Seif.

Thanks, Tom. Hi, everyone and good morning, good afternoon. Seif here with my colleague Jim. Thanks for tuning in today for our Q1 2023 results. It was just a few weeks ago that we provided you with our 2022 year end results and a preview of our Q1 2023. Going forward we will provide timely quarterly updates along with these earning calls. Before moving to Q1 I just wanted to remind everyone of our top priorities for the next couple of quarters. These priorities include financial discipline and deleveraging, which is top of mind, operational excellence, which is optimizing and growing our hashrate and lastly, growth and strategic partnerships for the sustainable future of this company. We'll touch on these key pillars throughout the presentation as we discuss our results and our current projects. With that, let's look at how Q1 shaped up. As I mentioned on the previous slide, financial discipline remains a priority and one of our key pillars. As part of this we're laser focused on cash flow generation and preserving cash. At the end of March, we had around $14 million of cash on the balance sheet. In the first quarter, we mined 491 Bitcoin and generated revenue of $11.4 million, which is an increase of 15% over our revenue from Q4 2022. Our mining margin percentage came in at 49%, which is a significant increase quarter-over-quarter, up from 35% in the fourth quarter of 2022, and that translated into an average cost per Bitcoin mined of 11,811. Aside from the price of Bitcoin and global hashrate, the other key variable that drives mining margin is our cost of power and hosting. For the first quarter, our average all-in power price and hosting rate came in lower than $0.05 per kilowatt hour across all our operations. And that was lower than the previous guidance we had given on our year end call of five to five and a half cents per kilowatt hour. As we'll discuss in more details in later slides, we are extremely focused on reducing non-mining operating expenses. Compared to the quarterly average in the second half of 2022 we were able to lower these operating expenses by 70%. And lastly, for the quarter, we generated an adjusted EBITDA of $1.6 million. I also wanted to briefly mention the spike in hash price that we experienced in May. This was due to higher transaction fees spawned by increased interest in Ordinals. That was obviously beneficial for us and you'll see the impact when we release our May operational update later this week. Now I'll let Jim provide some additional comments and also results for the quarter. Jim?

Thank you, Seif and hello everyone. As Tom mentioned, we are reporting our financial results in U.S. dollars. The majority of our revenues, mining expenses and debt are denominated in U.S. dollars, so it is appropriate for Argo to report in USD. We generated $11.4 million of revenue for the quarter with $5.6 million of mining profit, for a mining margin percentage of 49%. Our core business operations were profitable and we generated adjusted EBITDA of $1.6 million. In comparison to Q4 2022, we achieved higher revenues and lower expenses. We were able to reduce our non-mining operational expenses by 70%. At the end of the quarter, we had 14 million of cash on hand, which when combined with our operating cash flow, leaves us in a good position. Moving to the next slide, since closing the Galaxy transaction, we've been laser focused on reducing our non-mining operating expenses and we have reduced these expenses by 70%. Our core non-mining operating expenses for Q1 were $4 million and we have had further reduction since then. We're currently operating at just over $1 million per month in non-mining operating expenses. Turning to cash, as I mentioned, we ended Q1 with $14 million of cash on the balance sheet, a reduction of $6 million from December 31st. From an operating perspective, we generated $1.6 million of cash flow. Our core mining business is profitable, and this operating cash flow was offset by three main outflows during the quarter. Firstly, we had restructuring costs of $800,000 associated with reductions in headcount. Second, we had a reduction in working capital of $3.7 million, primarily related to the payment of invoices associated with the Galaxy transaction. And third, we had debt service and capital expenditures of $3.4 million. Excluding the restructuring and the working capital payments, our cash would have been approximately $4 million higher at March 31st, 2023. Moving to the next slide, the Galaxy transaction allowed us to significantly reduce our debt. However, we still have $79 million at March 31st, 2023 consistent with December 31st levels. Our goal is to reduce debt and we expect to do so using cash from operations and through the sale of non-core assets. Non-core assets include real estate, digital assets, certain parts inventory, and other investments. We look forward to reporting our progress on debt reduction in future news releases. With that, I'll pass it back to Seif.

ePIC: Regarding our Quebec expansion project, we recently signed and finalized the agreement with the City of Baie Comeau, which gives us access to an additional 8 megawatts of power via Baie Comeau facility still sourced from hydroelectricity. We expect to be able to take advantage of this increased capacity in mid-to-late 2024. And finally, as mentioned on our 2022 earnings call, our primary focus in the near-term is really about building and maintaining a solid foundation for the company. But having said that, we continue to explore some interesting growth opportunities to maintain our market share as the hashrate network continues to grow. We've been talking to different energy companies about opportunities to utilize wasted or stranded energy. This helps them because it allows them to monetize otherwise wasted energy and we in turn benefit from access to low cost and secure power. And so when we're thinking about growth opportunities, we're really thinking about innovative strategic partnerships with some key players within the power and energy spaces. That's it for now. Jim and I are open to taking your questions. Tom and Mark off to you.

Regarding our Quebec expansion project, we recently signed and finalized the agreement with the City of Baie Comeau, which gives us access to an additional 8 megawatts of power via Baie Comeau facility still sourced from hydroelectricity. We expect to be able to take advantage of this increased capacity in mid-to-late 2024. And finally, as mentioned on our 2022 earnings call, our primary focus in the near-term is really about building and maintaining a solid foundation for the company. But having said that, we continue to explore some interesting growth opportunities to maintain our market share as the hashrate network continues to grow. We've been talking to different energy companies about opportunities to utilize wasted or stranded energy. This helps them because it allows them to monetize otherwise wasted energy and we in turn benefit from access to low cost and secure power. And so when we're thinking about growth opportunities, we're really thinking about innovative strategic partnerships with some key players within the power and energy spaces. That's it for now. Jim and I are open to taking your questions. Tom and Mark off to you.

Seif, Jim, thank you very much for the presentation. Ladies and gentlemen, please do continue to make your questions just by using the Q&A tab, which is situated on the top right hand corner your screen. But just let the company take a few minutes to review the questions submitted today. I'd like to remind you the recording of this presentation, along with a copy of the slides and the published Q&A can be accessed via your investor dashboard. As you can see, we received a number of questions at the start of today's presentation. And Tom, if I may at this this point, hand over to you to read out the questions where it's appropriate to do so. I'll pick up from you at the end.

Great, thank you. Our first question comes from Kevin Dede at H.C. Wainwright.

ePIC:

ePIC:

Darren Aftahi at ROTH MKM.

What was your cost to mine a Bitcoin in Q1 and what's driving the increase in mining margin from Q4 to Q1 and how do you think Q2 will turn out?

Hey, Darren, thanks for the questions. So the margin -- the mining margin for the quarter was 49% and that was up from 35% in our Q4 2022 and that translated into Bitcoin mined of about $11,800. Mining margins really driven by three factors; Bitcoin price network, hashrate, and power cost. I think in Q1 the average Bitcoin price was somewhere around $22,800 and that was 26% higher than the average. In Q4 that was closer to about $18,000. The network hashrate obviously continued to grow, and the average hashrate in Q1 was about 16% or 17% higher than Q4. And then power in Texas, I mean, that got cheaper. We saw in 2022 gas prices got really high, power prices got really high, whereas in 2023 they fell more than 50%. So obviously if you combine all those three factors, net-net it's been better. We've had better margins because of that. And I think in Q2 Bitcoin prices have been even higher and gas prices have been a little bit lower. So I think our expectations for Q2 are positive.

Thanks Seif. Our next submitted question comes from Jake.

Can you talk a little bit more about the impact to the business from Ordinals?

Sure. So transaction fees for miners typically represent and thanks for the question, by the way Jake. Yes, so transaction fees for miners typically yield about or are about 2% or 3% of our revenues. In May that really shot up to about 13%. And some days was even much higher than that, but for certain blocks obviously. So it really means that we ended up mining more blocks than we otherwise would have. And basically we're going to be releasing our May operational update later this week and you guys will be able to see the impact that it has had. But obviously the Ordinals worked out well for the industry and for us.

Thanks. Our next submitted question comes from [indiscernible] and this is for Jim.

How do you plan on improving your cash flow?

Yes, thanks for that. We generated $1.6 million in cash during the quarter, and we'll continue to generate cash through Q2. Ways we can in improve our cash flow are continuing to focus and on our operating expenses and through the sale of non-core assets, and as we pay down our debt naturally our debt service costs will decrease and that will -- that's also another important lever in improving our cash flows.

Great, thanks. Our next question comes from Chase White at Compass Point for Seif.

Are you able to disclose the cost breakdown of the hosting agreement with Galaxy?

Absolutely. Hey, Chase, thanks for the question. So, I mean, the cost breakdown is pretty simple. We get access to power on a pass through basis, and then there's a fixed dollar amount per megawatt hour as a hosting fee based on our electricity usage. And so for Q1, the all-in price for both power and hosting fee came in sub $0.05 at Helios.

Thanks, Seif. Our next question, this is for Jim submitted from Tom S.

How are you planning on getting rid of your debt?

Yes, thanks for that. Yes, so beginning in May this year, we began our principle repayments on the Galaxy loan, so we'll be paying that down every month. We're also, as I mentioned, exploring the sale of certain non-core assets and using those proceeds to also pay down our debt.

Thanks, Jim. Our next question is for Seif.

ePIC:

ePIC:

Our next question comes from Kevin Dede again at H.C. Wainwright.

What specifically changed to reduce OpEx by 70%, was this headcount, how much of this change was realized by shifting operations of Helios to Galaxy? And this is for Jim.

Yes, thanks. Thanks Kevin. A large portion of the reduction was headcount which reduced from over 90 to approximately 40 as of March 31, 2023. While most of this shift was related to Helios and the Galaxy transaction, we did also reduce corporate staff. We also had some significant OpEx savings in insurance, for example now that we don't operate the Helios facility. We've also implemented a robust internal process where we are scrutinizing our vendors in order to realize additional cost savings. So we're really looking at it all encompassing in order to reduce our costs.

Great, thanks Jim. Our next question submitted comes from DS, it is for Seif.

How is the relationship with Galaxy these days?

Hey, thanks for the question. So, I mean, Galaxy's been a great -- our relationship with Galaxy has been great. It continues to be a very, very positive one. They have a great team. They're really smart. We're working very well together. We've been working very hard together on optimizing our machines and our performance in Texas or at Helios. And I think the skillset has been very complimentary, so really happy to have them working with us and it's been a very positive relationship. So…

Thanks Seif. Our next question comes, and this will likely be our last question. This comes from Bill at Stifel.

petahash:

hexahash [ph] and:

Seif, Jim, Tom, thank you very much for that and for answering those questions for investors. Of course the company will review your questions submitted today and we'll publish those responses on the investor meet company platform perhaps, but perhaps just before redirecting investors provide you with their feedback, which is particularly important to the company. Seif, could I just ask you for a few closing comments?

Yes, of course. I really just wanted to thank everyone for their continued engagement with Argo. We're really encouraged by some of the improvements we're seeing in our operational and financial results. Our core business is cash flow positive and the team continues to focus really on maximizing cash flow and reducing debt. So we'll keep updating you through our progress and providing you with our quarterly financial releases with our earnings calls. So again, thanks everybody. Really appreciate everybody's engagements and we'll talk to everybody soon.

Perfect. And thank you very much for updating investors today. Could I please ask investors not to close the session as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations? This will only take a few minutes to complete and I'm sure be greatly valued by the company. On behalf of the management team of Argo Blockchain plc, we'd like to thank you for attending today's presentation and good afternoon to you.