TORONTO--(BUSINESS WIRE)--Ether Capital Corporation (“Ether Capital” or the “Company”) (NEO: ETHC) announces its financial results as at and for the three and six months period which ended June 30, 2022:
- The total value of Ether and Staked Ether held by the Company was $58.6 million compared to $180.5 million at the end of the prior quarter, March 31, 2022, including Cash of $3.8 million ($4.2 million at March 31, 2022).
- The total value of the Company’s assets was $67.4 million compared to $193.2 million at March 31, 2022.
- The total shareholders’ equity of the Company was $66.2 million compared to $192.7 million at March 31, 2022.
- The Company recorded revenue during the quarter of $1.08 million and operating expenses of $1.13 million compared to $1.2 million and $0.8 million respectively for the quarter which ended March 31, 2022.
- Net Loss after tax, after incorporating Non-Operating and Intangible Expenses of $58.9 million was $58.45 million, or $1.74 per share, primarily attributable to the impairment recognized in income on the Company’s digital intangible assets.
- Net Book Value per Share was $1.96 compared to $5.74 at March 31, 2022.
The Company’s revenue of $1.08 million for the quarter included both consulting revenue of $.393 million ($.843 million year to date) from Purpose Investments pertaining to its crypto ETFs (BTCC and ETHH) and $.687 million ($1.4 million year to date) from Staked Ether Rewards, which since inception has not been redeemed. The gross yield on Staked Ether was approximately 4.65% during the second quarter and any future redemptions of Staking Rewards would generate Canadian dollars to fund operations and investments. Consulting revenue remains under pressure due to the impact of market volatility on the ETFs. Operating expenses have increased year-over-year primarily related to salaries and benefits with the addition of talent in recent months. Details about these results and developments are included in the Company’s financial statements and the Management Discussion and Analysis (MD&A).
“The second quarter was extremely difficult for all industry participants and I am pleased that Ether Capital was able to avoid the challenging conditions endured by others. Our liquidity puts us at a competitive advantage at a time when other companies in the sector are experiencing financial headwinds,” said Brian Mosoff, CEO of Ether Capital. “Our plan is to continue generating yield by staking our Ether and using the rewards to build out our business. Current market conditions have underscored the need for quality infrastructure to be built and this is exactly where we want to be. We’re also very bullish on Ethereum's transition to Proof of Stake and believe the upcoming Merge anticipated this fall will prompt a new wave of enthusiasm for the protocol from both institutional and retail investors.”
“Although we generated a modest pre-tax operating loss of approximately $0.05 million in the quarter, our cash resources of $3.8 million as at June 30 and the lack of external debt provide us with financial flexibility,” said Ian McPherson, President & CFO of Ether Capital. “The major decrease in asset value is attributable to the price of Ether declining from US$3,284 on March 31 to US$1,020 on June 30 — a decline of 69% in the quarter. The price of Ether is volatile and the Company is optimistic for its very strong price appreciation over the medium term.”
Ether Capital’s portfolio company, Wyre, also entered into an acquisition agreement with Bolt, a leading American checkout and shopper network company, during Q2 2022. Details on the transaction are not yet public. The transaction is expected to close before the end of 2022 and is subject to multiple regulatory approvals and customary closing conditions.
Summarized below are the primary digital assets held by Ether Capital as at June 30, 2022:
|
Ether |
Staked Ether |
Staked Ether Rewards |
Units (ETH/Staked ETH) |
23,610 |
20,512 |
460 |
Dollar Value (CAD) |
$31.02 million |
$26.95 million |
$0.63 million |
To access unaudited interim financial statements for the quarter, which ended June 30, 2022, please refer to the Company’s website at http://ethcap.co/. The Company’s unaudited interim financial statements, including the MD&A, have been filed on the System for Electronic Document Analysis and Retrieval (“SEDAR”) and may be viewed under the Company’s profile at www.sedar.com.
The Company will host a webinar on August 15, 2022, at 11:45am ET to go over its Q2 financial results, which you can register for by clicking here. Ether Capital’s CEO Brian Mosoff and President & CFO Ian McPherson will also discuss the significance of Ethereum’s transition to Proof of Stake (the Merge) and what impact this pivotal upgrade will have on shareholders.
About Ether Capital Corporation
Ether Capital (NEO: ETHC) is a leading public technology company with a long-term objective to become a central business and investment hub for the Ethereum ecosystem. The company has invested the majority of its balance sheet in Ethereum’s native utility token “Ether” as a core strategic asset and yield-generating instrument. The company is focused on building institutional-grade financial infrastructure that supports the Ethereum blockchain and delivers corporate value. Ether Capital’s management team and Board of Directors are comprised of crypto natives, leading venture capitalists and capital markets experts, which uniquely positions the company to identify and capitalize on opportunities in the digital asset ecosystem. For more information, visit http://ethcap.co.
The content of this document is for informational purposes only and is not being provided in the context of an offering of any securities described herein, nor is it a recommendation or solicitation to buy, hold or sell any security. The information is not investment advice, nor is it tailored to the needs or circumstances of any investor. Information contained on this document is not, and under no circumstances is it to be construed as, an offering memorandum, prospectus, advertisement, or public offering of securities. No securities commission or similar regulatory authority has reviewed this document and any representation to the contrary is an offence. Information contained in this document is believed to be accurate and reliable, however, we cannot guarantee that it is complete or current at all times. The information provided is subject to change without notice and neither Ether Capital Corporation, nor any of its affiliates, will be held liable for inaccuracies in the information presented.
Non-GAAP Measures
The Company’s condensed consolidated financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”). In this press release, the Company discloses the gross value of its assets and the gross value per basic common share, which are non-GAAP financial measures. These non-GAAP measures are not defined by IFRS, do not have a standardized meaning and may not be comparable with similar measures presented by other issuers. The Company has presented such non-GAAP measures as management believes they are relevant measures of the value of the Company’s underlying assets. Non-GAAP measures should not be considered as alternatives to the information set out in the Company’s financial statements.
Forward-Looking Information
This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements in regard to the Ethereum ecosystem. The Company cautions the reader not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. Generally, but not always, forward-looking information can be identified by the use of forward-looking terminology such as “plans,” “expects” or “does not expect,” “is expected,” “budget,” “scheduled,” “estimates,” “forecasts,” “intends,” “on pace,” “anticipates,” or “does not anticipate,” “believes,” and similar expressions or state that certain actions, events or results “may,” “could,” “would,” “should,” “might,” or “will” be taken, occur or be achieved.
Forward-looking statements are based on information available to management at the time they are made, management’s current plans, estimates, assumptions, judgments and expectations. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to: general business, economic, competitive, geopolitical, technological and social uncertainties; market volatility of Ether, uncertainties in regard to the development and acceptance of blockchain technology (including Proof of Stake and Ethereum 2.0), and the Ethereum platform and anticipated timing and impact of the Ethereum network upgrade, timing and terms of proposed transactions related to non-core asset dispositions, assumptions and judgements related to fair value estimates, and the other risk factors discussed in the Company’s Annual Information Form dated March 23, 2022, the Risk Factors section in its most recently filed management’s discussion and analysis, the Risk Factors section in its Supplement and Base Shelf Prospectus and its other filings available online at www.sedar.com. Although the forward-looking information contained in this press release is based on assumptions that the Company believes to be reasonable at the date such statements are made, there can be no assurance that the forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such forward-looking information. In addition, the Company cautions the reader that information provided in this press release is provided to give context to the nature of some of the Company’s future plans and may not be appropriate for other purposes. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update or revise any forward-looking information, except in accordance with applicable securities laws.
