Phoenix Group, the inaugural UAE-listed cryptocurrency mining firm, has released its financial results for 2024, showcasing a notable contrast between robust mining revenue growth and an overall downturn in total revenue and profitability.
UAE Bitcoin Miner Reports Mixed Results
The company’s mining revenue skyrocketed by 236% to $107 million; however, total revenue dipped nearly 30%, falling to $205.7 million from $288.2 million in 2023. Net profit attributable to shareholders decreased to $167.4 million compared to $207.8 million, with earnings per share seeing a drop to $0.028 from $0.040 the prior year.
Despite these challenges, Phoenix Group is committed to its expansion strategy, with CEO Munaf Ali expressing optimism: “The past year has been crucial for Phoenix Group, characterized by significant growth and improved profitability.”
Nevertheless, the financial data presents a more intricate picture, as EBITDA fell from $208.6 million to $190.7 million in 2023.
The company’s total assets rose modestly to $962.4 million, up from $834 million, while shareholders’ equity increased to $891.8 million from $697.1 million. Phoenix Group has maintained its Bitcoin network presence with a computing power of 15.0 EH/s, accounting for a 1.90% market share.
$370M IPO
Last year, Finance Magnates reported the Abu Dhabi stock market (ADX) welcomed its first publicly listed Bitcoin mining company, a model that has gained immense popularity in countries like the U.S. Following its IPO, which garnered $370 million, the company announced a financial report indicating a threefold decrease in revenue compared to the previous year. Despite the revenue drop, asset holdings significantly increased.
Net profit, however, saw a sharp rise even amidst declining revenues, primarily due to a “one-time contract” that skewed the company’s anticipated cash flows.
Nonetheless, the report was met with discontent among shareholders, as the company’s stock has plummeted by 20% since its launch and continues to struggle with market popularity.
Approaching Penny Stock Status
The company’s stock performance has been particularly difficult since its late 2023 introduction on the ADX. Shares have fallen nearly 60% from their peak, currently priced at AED 1.01 ($0.27), putting the company alarmingly close to penny stock status.
Source: ADX
The fourth quarter demonstrated some operational enhancements, with self-mining gross margins increasing to 24% from 5% in the preceding quarter, fueled by Bitcoin’s price appreciation and improved efficiency in North American facilities.
Looking towards the future, the company has secured agreements for additional facilities in Ethiopia and Texas and is diversifying into various cryptocurrencies while collaborating with the Tether Foundation on a dirham-backed stablecoin initiative.
