Greetings and welcome to Mawson Infrastructure Group, Inc. First Quarter 2022 Earnings Results Conference Call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. . As a reminder, this conference is being recorded. I'd now like to turn the conference over to your host Nick Hughes-Jones, Chief Commercial Officer. Please go ahead sir.

Hello everybody and thank you for taking the time to hear about Mawson Infrastructure Group. My name is Nick Hughes-Jones, Chief Commercial Officer of Mawson. Joining me today is James Manning, our Chief Executive Officer and Founder and Hetal Majithia, our Chief Financial Officer. We look forward to taking you through the investor presentation today, but first, I need to read you a short disclaimer around forward-looking statements. Please be aware today, we will be making forward-looking statements. These statements are based on current expectations and assumptions and are subject to risks that could cause actual results to differ materially from those expected. Please be sure to refer to the cautionary text regarding forward-looking statements contained in this presentation on Slide 2. Okay, Mawson at a glance. As of last Friday night's close, Mawson has a market cap of approximately $180 million, is listed on the NASDAQ under the code MIGI, M-I-G-I and has five Bitcoin mining sites across the USA and Australia. Now for those of you that aren’t aware of what an exahash is, abbreviated as EH in these slides, crudely speaking, an exahash is a measure of computing power. The more exahash you have online, the more Bitcoins you produce on a daily basis. As at the end of May 2022, we expect to have Bitcoins sales money to be operating at approximately 1.8 exahash producing approximately 8 Bitcoin per day. Based on current network difficulty and a Bitcoin price of $30,000. This equates to around $88 million in annualized revenue. Today, we are pleased to announce a new 120 megawatt Bitcoin mining facility in Texas in collaboration with JAI Energy and Texas Pacific Land Corporation, one of the largest landowners in Texas with over 880,000 acres in their land portfolio and listed on the New York stock exchange under the ticker TPL. As a result of this new Texas facility, we're today upgrading our energy infrastructure capacity available for Bitcoin mining by 35%, from 350 megawats to 470 megawats. This is a significant strategic advantage for Mawson given the very high levels of demand for energy infrastructure in the Bitcoin mining industry today. We are also reiterating our targets of four exahash online by Q3 2022 and 5.5 exahash by early Q1, 2023. This would see us producing 18 Bitcoin per day and 24.5 Bitcoin per day respectably based on current network difficulty. Mawson is also proudly a net zero carbon minor and hosting co-location provider. Something I'll touch on later in the presentation. With that I'll hand over to CEO and Founder James Manning.

Thanks, Nick. Q1 was an exciting period for the group. Our hosting co-location business expanded materially. As we signed major hosting customers, Celsius Mining and Foundry Digital, generating new revenue streams for Mawson, which is all paid in US dollars. Our team has expanded with the Mawson family now over 50 hardworking individuals based in the USA. We continued the rapid scale up of our self-mining operations. Turning to the Q1 results; quarter one, was a solid quarter financially and operationally for our business. Mawson generated $19.4 million in revenue up 178% compared to Q1 2021. Revenue was flat in Q1 2022 versus Q4 2022, a good result in an environment where Bitcoin price fell from a higher 69,000 in November to a low of 33,000 in January. This is a result of the substantial increase in our self-mining operations between Q4 '21 and Q1 2022 and we've seen this rapid scale up continue into Q2. Gross profit came in at $11 million up 138% compared to Q1 2021 and non-GAAP EBITDA came in at $4.5 million up 160% versus Q1 2021. Some of our operational highlights in Q1 include, we completed the build out of our 80 megawatt facility in Georgia and in very exciting news, we gained approval to expand this facility nearly threefold to 230 megawatts, which is capable of operating at 7.5 exahash. We expect this expansion to come online in Q3 2023. We signed our largest hosting co-location customers today, Celsius Mining for a 100 megawatts and Foundry Digital for 12 megawatts, generating significant additional revenues for Mawson in addition to our Bitcoin self-mining revenue. In Q1, we upgraded our self-mining exahash targets to four exahash in Q3, 2022 and 5.5 exahash in early Q1, 2023. We secured a 20 million debt facility from Celsius Network and exciting news today, we've announced a new Bitcoin mining facility in Texas in collaboration with JAI Energy and Texas Pacific Land Corporation, one of the largest landowners in Texas, which is listed on New York Stock Exchange under TPL. With that I'll hand over to our CFO, Hetal Majithia to run through the financials in a little more detail.

Thanks, James. Okay. Turn to the balance sheet. Cash and cash equivalents in quarter one 2022 rose to $5.8 million from $5.5 million in quarter four 2021. In addition to this modest rising cash, we also paid down approximately $3.2 million of our Foundry Digital debt facility over the course of quarter one and have continued to pay this down in quarter two. We currently expect this debt facility to be paid off in four in quarter three 2022. Property and equipment rose to a $102.5 million in quarter one up from $76.9 million in quarter four, reflecting the ongoing expansion of our Bitcoin mining fleet and energy infrastructure deployment across our Australian and US facilities. Equipment deposits declined $41.7 million in quarter one down from $51.4 million in quarter four as Bitcoin mining continued to be delivered to our facilities and no major Bitcoin mining purchases were made in quarter one. Bitcoin mining hardware deliveries related to these deposits have been delivered consistently throughout quarter one and have continued on into quarter two. Our total assets grew to $166 million in quarter one up from $145.3 million at the end of quarter four. Total liabilities rose to $62.1 million in quarter one from $30.7 million in quarter four, which was predominantly the result of a new $20 million debt facility secured with Celsius Network LLC. We expect to continue to use debt facilities in equipment finance facilities where appropriate. This is a very capital-efficient way of expanding our Bitcoin mining fleet and expanding our infrastructure in turn increasing the number of self-line Bitcoin we produce on a daily basis, as well as increasing our ability to bring on additional hosting colocation customers. With that, I'll hand it back to CEO, James Manning.

Thanks Hetal. As you can see, between May, 2022 and Q3 of 2022 Mawson will deliver a substantial increase in our Bitcoin self-mining operational footprint, moving from 1.8 exahash to four exahash, a 122% increase in our self-mining hash rate in just over six months. As Slide Six demonstrates, this would increase daily self-money Bitcoin production from approximately eight Bitcoin per day at the end of May to approximately 18 Bitcoin due per day by Q3 2022. It's important to note that the revenue numbers on this slide are base on current network digital, Bitcoin at 40,000 and the current expectations are around our minor and energy infrastructure deployment. What's genuinely exciting is as we move to early Q1, 2023, we expect to hit our 5.5 exahash target producing 24.5 self-mine Bitcoin per day, and generating 357 million in annualized revenue. Turning to Slide Seven, pleasingly our hosting colocation business has continued to its rapid expansion. At Mawson, we have energy infrastructure capacity surplus to our own self money requirements. We're able to use these surplus infrastructure to generate additional revenue streams. We are paid in US dollars for providing hosting services to third party customer. The revenue and the cash flows from this business are highly predictable and the vast majority of our customers are very large businesses. We now have a 116 megawatts of hosting colocation customer agreements in place, making us one of the largest Nasdaq-listed hosting colocation providers and we expect to expand this further to 140 megawatts by the end of 2022 and then up to 220 megawats in 2023. As at the end of May, we expect our hosting colocation business to be operating at approximately 52 megawatts nearly halfway to our fully contracted deployment of 116 megawatts. We will continue to report our…

Thank you, James. Expanding on our established energy pipeline on Slide Nine, our current exahash capacity plus potential brownfield expansion opportunities at current sites sees us with the opportunity to be producing at approximately 21.8 exahash over time, split appropriately between self-mining and hosting colocation operations. And of course the speed in which we expand beyond our guidance will be subject to market conditions, as always the best idea wins. Critically Mawson is committed to being a long-term sustainable Bitcoin model. We target carbon free and renewable energy at our sites with our current mix at over 75% carbon-free energy. In Pennsylvania, we are using 100% nuclear energy and we source our nuclear power from Energy Harbor, who own three of the local nuclear power plants in Ohio and Pennsylvania. The Beaver Valley nuclear power plant is just a mile from our Midland Pennsylvania facility. In Georgia, where we've recently been approved to expand our facility threefold to 230 megawatts, the vast bulk of our energy comes from nuclear and hydro and importantly, there are two brand new nuclear reactors coming online in the next 12 months, Vogtle 3 and Vogtle 3, two 1100 megawatt Westinghouse pressure water reactors. This is one of the major reasons we select this site and we expect a lot of carbon footprint and potentially lower energy prices as these new reactors come online. We are excited today to include Texas in our investor presentation, where we have secured a site that is capable of operating at up to four exahash and importantly, at this facility, we have collaborated with JAI Energy and Texas Pacific Land Corporation, one of the largest landowners in Texas with 880,000 acres across their land portfolio, providing us with substantial opportunity to expand into the state of Texas over time.…

Thanks Nick. Slide 15 spells out some of the achievements we've had recently across our innovation portfolio. As we alluded to earlier, in March, we announced two large hosting co-location customers, a 100 megawat agreement with Celsius Mining and a 12 megawat agreement with Foundry Digital. These two deals illustrate the tightness in the industry around energy infrastructure at present and how well-placed we are to capitalize on this high demand. Secondly, following on from the listing of cosmos asset management first product in the Australian market in late '21, the cosmos global minors ETF, cosmos recently announced a partnership with Focus Investments, a multi-billion dollar asset manager who listed the world's first spot Bitcoin ETF 12 months ago. As a reminder, Cosmos' asset manager Adam Wilson remains for however Mawson remains Cosmos's largest shareholder. In very exciting news last week, the Cosmos' purpose Bitcoin access ETF launching the Australian market, making access to Bitcoin significantly easier for all Australians. For our second last slide I wanted to highlight just how lined more's board and senior management is with all our fellow shareholders. Board management currently earned approximately 24% of Mawson. So we all have a huge amount of skin in the game. This is unique amongst our NASDAQ Mawson with peers and ensures we are extremely focused on shareholder returns. Lastly, for me, and before we move on to questions, in summary, why invest in Mawson Infrastructure Group? Well, over the next nine months, we expect to grow our self-mining business threefold and continue to expand our hosting co-location business. We are an infrastructure first business with a significant amount of energy infrastructure in place and strategic advantages in a current environment. We are one of the most sustainable Bitcoin monitors on the NASDAQ with over 75% of our energy coming from sustainable sources, predominantly nuclear energy. We have strategic relationships with Quinbrook Infrastructure Partners, Purpose Investments, Celsius Mining, Canan Foundry Digital, JAI Energy and now Texas Pacific Land Corporation. We're one of the most efficient and lowest cost operators in the industry and we have very high insider ownership at 24%, meaning we are incredibly focused on shareholder returns. With the presentation now complete we wanted to take this opportunity to thank all of our employees and shareholders for their ongoing support in 2022. I'll now hand the floor back for any questions.

We have our first question from the line Kevin Dede with H.C. Wainwright. Please go ahead.

Hi James, it's Nick. Thank you very much for taking my questions. Thanks for hosting the call. James apologies for this first -- apologies for this first one. I understand the target for exahash September and five and a half sometime early next year, but I lost you. What was the hash rate at the end of the March quarter? Was that the 1.8 number or is the 1.8 number, the current number

1.8 is our current that's our may number.

Okay. That's May. Okay. What was March end?

Nick? Have you got that by hand?

Hey Kev. How you going?

Great. Thanks, Nick. How are you?

Full speed ahead. So the end of March self mining, exahash number sorry about, pardon me, average hash rate for March was 1.2 exahash. The end of month hash rate was 1.35 exahash and then as James has alluded to, we'll be at 1.8 aha on the self-mining at the end of May.

Okay. Can we talk a little bit about the Texas location. What's the climate like what sort of work do you have to do with AirCot or are you behind the meter? What condition is the site in just some background there?

Sure. I'll keep it pretty high level Kevin, but one of the things that really attracted us to this opportunity was that the substations were in place. So it's actually a series of smaller sites all within close proximity to each other and so no single sites greater than 30 Mgs, but not less than 20 Mgs. So it's a series of sites all within sort of 5 minutes to 10 minutes of each other that we'll build out. The upside of that is as you're aware, no doubt aware in Texas, if they've changed the rules about bringing large, low generation on and we're sort of under that threshold as well with these sites and these scales. So we'll be able to turn on each sites pretty quickly. Substations are in place and ready to be energized. So it's just low side transformers and then, pragmatically, we believe we've got the modular container solution work in that climate based on the work we've done.

Okay. listen, I know you have first-hand experience with immersion right. That you're thinking that's not going to be a requirement here.

Look, we're, we're not going to rule it out Kevin. We might put some in and it's a great spot to do some testing on immersion or scale up one of our plants. But the economics, the economics emergent are getting there. So historically we've not really wanted to but, they're starting to look attractive, but I think in the short term we would definitely be pursuing the ERCOT at this point.

Okay. The power agreement is through JAI and then to ERCOT or how does that work?

No, we've got a separate power agreement and we're not -- I can't disclose the terms of the power -- the PPA or what we're doing there yet, but Jai and I facilitated the transaction with Texas with the land over.

I see okay. Just looking at the network overall, the Mawson network overall, where is your on average, where is your cost per power and how is that going to change as more Georgia comes online and as more Phil Pennsylvania comes online.

So our Pennsylvania power is partly hedged already and some of that will flow through -- some of that flows through to the end customer where it's in hosting. So we're on like a cost plus type arrangement for component of that power. Some of that's hedged, some of that is floating. So we'll see some volatility and I guess some of the hosting revenue attached to that as well as it'll flex with the power rates. We are looking to lock in and hedge out as much of the power long term as we can, but over the last couple of months, you've obviously seen a lot of volatility in edgy markets. So, we're taking a cautious approach to locking anything in too quickly now because as you look further out, the prices are looking cheaper further out. So, we're just trying to weigh up what we hedge and what we don't hedge. Obviously some of the Texas pricing is more attractive at the moment that we've got and some of that existing PA contract's really attractive as well.

Can you give us sort of a ballpark on where the overall Mawson cost per kilowatt kilo at hour is?

I haven't got a weighted average one at the moment, but I'm happy to come back to you separately on that, Kevin.

Okay. Fair enough. Thank you, James. Now, how about the timeline on your hosting customer's deployment?

Yeah, so as we mentioned, we're on track to have about 50 megawatts deployed, 50 to 60 megawatts deployed in PA and we're at the end of month and we're really powering all along there. So we're currently deploying about four containers, four containers there a week, four to five containers a week. So between eight and 12 megawatts a week going online in PA at the moment. So the team's working really hard to get that deployed and I think we're pretty comfortable with that deployment rate at the moment. So we've got ability to flex that up a little bit more, but I think we'll get up to about six containers a week and that's 12 megawatts to 15 megawatts a week, but we can deploy at that rate.

Okay. So all the hosting will be at your two PA sites?

Yes. At this stage.

Okay. Then just to touch on the increase in facility size in Sandersville. Sure. Having been there, I with Liam's direction, I understand you're going to clear forest, I think if I understand it correctly and I'm just, I guess you mentioned that you expect deployment there to begin sort of the tail end of next year. Is that, did I hear that all correctly?

Yeah, we'll be looking to start building that facility, the expansion that facility next year, starting probably Q1.

Okay. Can we talk a little bit about your philosophy on holding and spending and capital sources and what you think you're going to need to build that and Texas out?

Sure. So we currently, I think we're one of the lowest cost I guess infrastructure players in the space at the moment. And I think that's probably been one of our key advantages in deploying what we've deployed to date. So, we're going to continue to be focused on cost and getting a very efficient, low cost operation and continue to build that out. As far as, capital requirements for building out additional sites, we've made it very public and we are very clear that we're looking to do a mix of both our hosting clients and our self-mining. The self-mining we we're looking to fund organically through cash flow, as well as short-term facilities, we've typically done a 12-month facility on equipment and amortize those things over 12 months. So where we buy asset minors and so forth that the way we'd approach this and we'd cash flow, the infrastructure as we went. Where we're looking at taking on larger hosting customers like we did with Celsius given the tightness in the hosting market at the moment, we'd be looking those hosting customers or to other debt providers to lock in some facilities around that infrastructure build out for that customer. So we can make a very clear economic case about not only bringing on that infrastructure, but the return on that customer over the period and if that's the best use of our capital.

And Kevin, as you're aware, also selling Bitcoin daily, which generates cash flow for us,

We are. Right. Yeah. Thank you for reminding me. I appreciate that, Nick. Okay. Let me hop back in the queue. Thank you for entertaining my questions.

We've got a bunch of questions that have come through on email. I might read those out if you're happy with that.

Yes, sir. Please go ahead.

Okay. So Matt asked what have Bitcoin mining hardware prices done recently with the market sell off? I might take that one James and Hetal. So mining hardware prices happily for us have come right back. So, if you're looking at a what's minor, M30 and 30S, that was $80 or $90 a terahash. At the beginning of the year, we're seeing prices around the sort of $50, $60 a terahash mark. So hardware prices tend to have a fairly high correlation with the Bitcoin price. So the market's sold off and that's made hardware much more attractive for us. Next question. Is, are you seeing any impact on minor deliveries out of China? James, did you want to say that one?

Sure. So far we haven't seen any impact on deliveries. We've all our freight and everything's been working fairly well. We always assume there was going to be a delay in some extended shipping times, and we always mobile that in. We are seeing, freight -- air freights difficult, and it's hard to get things up in the air at the moment out of China and the last month's been particularly difficult, but we haven't seen any material slippages and definitely no slippages relative to our current deployment projections.

I think the other important point there is we've only got a couple more shipments left of mining hardware coming out of China and then we'll be looking at spot orders here in the US and hardware prices have come right back and that's the gear that's landed in the US and so that's obviously a much better outcome cause you don't have any of the supply chain issues that you're seeing globally at the moment. Okay. Next question. Where do you see the global hash rate going over the next 12 months? I'll take that one. So I think we sort of -- we expected or guesstimated to be around 300 exahash by the end of this year. That's looking a little bit less likely at the moment because you've seen, obviously it's at the margin harder to mine Bitcoin in Russia. You would imagine likewise Ukraine, likewise Kazakhstan, I think given energy prices in Europe, it's probably harder or less profitable mine, Bitcoin in Europe. And then you've seen from a bunch of other US-based minors that they have a lot of Bitcoin miners sitting in boxes at present. So it's very difficult to get energy and energy infrastructure online in the US. So I think that global hash rate has probably got some downside to it versus our sort of expectations of a couple of quarters ago, which is obviously great for installed miners that are adding hash rapidly like we are. Next question. Why do you sell Bitcoin instead of HODL? I think we sort of touched on that just around generating cash flow to fund our operations and our CapEx. And last one here is what will your split on self-mining hosting be going forward, giving you now have such large energy and infrastructure pipeline? James, do you want to take that last one?

Sure. So I think we've always sort of said that we'd explore up to a 50-50 hosting and hosting and self-mining. As our portfolio expands, we'll consider that mix at the moment. We're prioritizing obviously the highest margin and the best use cases for us, which is self-mining, but we're conscious, we'd like to, continue to partner and build out with the right partners, that are hosting model. So while I don't want to -- don't want to put a firm percentage on it, we are really looking at the infrastructure and the counterpart on a case by case basis, especially given the recent volatility in the market. We really want to make sure we've got really strong hosting customers where we do take hosting customers on and it makes sense from an infrastructure deployment perspective that that's the best use of capital for the business.

Okay. Operator, that's all the questions we have there. I might pass it back onto you to wrap up.

Thank you. So we have another -- we have next question from line of Kevin Dede with H.C. Wainwright. Please go ahead.

Sorry, James, Hello. It's me again. Kevin Dede. There's still a lot of questions right to be asked. You talked about a one gigawatts pipeline. I was wondering if you could offer some color on the visibility there? Is that through your partnership with JAI, Quinbrook, how are you sort of getting to a number that large?

Yeah, I'll take that one. We've got, what I could say to you is we've very comfortable around that pipeline. I think what you've seen is we've lost one side away, this month we've got another -- we've got another site, that's a couple 100 megawat site that we've got where we've got under an exclusive arrangement that we are looking through to contract at the moment. We've got Sharon, which we haven't -- we've contracted the lease on, but we yet to complete the load studies on. So I think where we're sitting there on that pipeline, Kevin is, we've got some sites there that we're very comfortable around the energy being there we're in the process firming up those energy the ability to contract that energy and locking it in. And I think, you can see in Georgia, we've slowly upgraded that period by period as we've locked away certain upgrades on online and transformers and substations and so forth. We're doing that in Sharon at the moment. I'm really looking forward to coming to market and telling everyone, just how great that site really is. We've got Texas obviously came out and we' firm around that number. And then we've got another site that we're really firm on as well. And we know what's available there, but until that's finalized, we won't be coming to market and really bringing that forward. And I think between the two sites that I can't mention at the moment, that goes a long way to the gap between where, that one gigawatts and where we are today. So, they're the existing stuff that's in the pipeline and then with our partnership with Nick Hughes, we've got a large site that we're looking at with them, and there's some other partners that we've got that we're looking at we're in advanced stages of discussions with, for the large sites as well.

The other thing that's important to mention is the Texas site we announced today is in partnership with Texas Pacific Land Corporation, which is one of the largest landowners in Texas. I think its 880,000 acres under their portfolio. And so there's substantial opportunity to expand into that relationship as well. But I think the overarching comment is that we're going to be very disciplined and very aware of market conditions and certainly not overreach ourselves, which is possibly where you were heading with that question.

Oh, no, no. I wasn't concerned about that. I know you guys are savvy managers. I just you -- the word pipeline is vague. And I just was looking for a little more granularity, which you offered. So thank you very much. The site in Texas is I guess ERCOT supplied. I was wondering if you could talk to the local power sources there and how you might consider the power mix in terms of natural gas or renewables.

Yeah, for sure. So we're going through that process with Power at this point. So we'll probably defer answering that question until we've got a little bit more granularity around that, Kevin.

No problem. Thank you. I know…

What I would add to that, Kevin is -- what I would add to that. Kevin is, we've got that our strong ESG mandate, and we're not going to defer from that. So whatever we do there, we'll be looking to either, match out with credits or ensure that we contract the right mix.

Okay. Fair enough. Thanks James. Your team at Mawson's had close affiliation with Canan for a long time. I'm wondering, given a host of new entrance what you've investigated in terms of exploring alternative machine sources.

We've got quite a few of the Watts miners within our portfolio, not just the Canon units. I'll say this about the Canon units. Canon's been a great partner for us, and I think we've been a great partner for Canon. We went out on a limb with Canon when no one else was really buying at large scale from them. And we did that, with the benefit of a lot of knowledge. So we pulled down their unit, we did a lot of reverse engineering and checks to make sure we were really comfortable with them. We asked a lot of tough customs and we realized the Canon team where -- they were building really good gear and it's phenomenal. It's really standing up. We're having as good or if not better up time out it than we get out of the Watts miners and the bit main units. So, I think that, they're a top tier manufacturer and we've got a great relationship with them and I hope that our early support of them at scale, when everyone else wasn't is going to really reflect in our long term relationship together. So, that's what I'd say about the Canon relationship. As to other equipment manufacturers, look, we're closely watching, obviously where Intel's in entering the market and we're looking -- we'd like to look and explore that. Look, we're acutely aware of some other manufacturers that have entered the market without naming names. We bought some test units to test and we weren't satisfied. So we've walked away from a couple of those players. I'm very aware that, other market participants have bought those units in scale and have performance issues. So, I guess the benefit of being a minor that's been around for a little bit more than a couple of years, which some of these minors definitely are only a couple years old in the market is, we've seen some of the bad routes in machine manufacturing and I definitely remember dealing with that 2019 batch of Bitmain units that had 30% to 50% value rates and working through that resolution. So, we're a lot more cautious and we've got a lot more processes now about how we -- how we quality control equipment and deployment. So we're very aware of new equipment coming into the market and we're always looking at it -- always testing new equipment and always exploring this sort of stuff. But we're very, also cautious about it and some things just don't pass master forest as far as we're concerned.

Perfect. Thank you very much for taking my questions again.

Thank you, ladies and gentlemen, we have reached the end of the question-and-answer session, and I'd like to turn the call back to the management for closing remarks. Over to gentlemen.

Great. Well, I'd just like to say from on behalf of the entire Mawson team to all our shareholders and anyone else that are on the call, whether it's employees, board, if you're on the call, it's been a great start at 2022. We've got a lot to deliver and we're really focused on delivering that this year. And we're hope you are all along for the ride and we're looking forward to delivering on what we promised moving forward for the latter half of the year. Thank you.

Thank you very much sir. Ladies and gentlemen, this concludes today conference. You may disconnect your liens at this time. Thank you for your participation.