VANCOUVER, British Columbia, March 02, 2023 (GLOBE NEWSWIRE) -- DMG Blockchain Solutions Inc. (TSX-V: DMGI) (OTCQB US: DMGGF) (FRANKFURT: 6AX) (“DMG”), a vertically integrated blockchain and cryptocurrency technology company, today announces its first quarter 2023 unaudited financial results. All financial references are in Canadian Dollars unless specified otherwise.

Recent Highlights

• Revenue of $7.2 million on 274.70 mined bitcoin, net loss of -$7.0 million, -$0.04 net loss per share
• DMG leads the industry having executed its Petra technology and using that technology to be the first to place carbon-neutral Ordinal transactions on the Bitcoin blockchain
• DMG is cautiously investing in key infrastructure and software initiatives, focusing on optimizing its investments in the challenging crypto environment
• Strong balance sheet as of December 31, 2022 with $10.9 million in cash and digital currency (453.06 bitcoin) and debt of $1 million

Readers are encouraged to review the Company’s December 31, 2022 quarterly unaudited financial statements and management’s discussion and analysis thereof for a fulsome assessment of the Company’s performance and applicable risk factors, available at www.sedar.com.

Sheldon Bennett, DMG Blockchain Solutions’ Chief Executive Officer, commented, “DMG has successfully executed its Petra technology, for which we are utilizing to place Ordinals (used to make inscriptions to represent ownership of NFTs or non-fungible tokens) on the Bitcoin blockchain. Petra ensures those NFT creators who want to utilize the most immutable digital asset ledger can do so in a carbon neutral manner. This is a huge step forward for the industry, as NFT creators have a new option they didn’t have previously for transacting their digital assets. These creations, whether they be art or music, stay recorded on the Bitcoin blockchain for all time, as miners are the guardians that ensure blockchain immutability. NFTs also can become a recurring revenue opportunity, as each time the NFT is to be transferred in a carbon neutral manner, the associated transaction fees may go to DMG and other Terra Pool members.”

Steven Eliscu, Chief Operating Officer added, “The company continues to manage its cash closely, with spending focused on its Core+ and immersion cooling initiatives and making incremental improvements to our mining operations. From a Core+ perspective, we are continuing developments that are bolstering our capabilities. Under the hood, we have upgraded our Terra Pool software, which includes making our infrastructure more scalable at lower costs. Our goal is to maximize revenue for DMG and pool members, making a green pool attractive not just because it’s carbon neutral but also because it’s more profitable.”

Financial Highlights

Revenue for the first quarter ending December 31, 2022 was $7.2 million versus $14.3 million in the year-ago quarter, a decrease of 50%, driven primarily by a 65% year-over-year decline in the quarterly average bitcoin price, which was in part offset by a 50% increase in the amount of mined bitcoin to 274.70 from 183.20 in the prior-year period.

Operating and maintenance costs for the quarter ended December 31, 2022 was $4.4 million as compared to $2.8 million in the year-ago period. The majority of this increase was due to utility costs, which increased $1.6 million during the period. This increase was the result of an increase in digital currency mining activity from additional miners acquired during the year.

General and administrative expenses increased to $948 thousand in the quarter ending December 31, 2022 versus $701 thousand in the prior-year period. This increase was primarily due to higher wages, which increased by $215 thousand during the period.

Net loss for the quarter was $7.0 million, versus a net profit of $5.0 million in the prior-year period. The loss was primarily the result of lower revenues combined with increasing operating and maintenance costs of $1.7 million, higher depreciation expenses of $2.6 million and unrealized revaluation losses on digital currency of $1.4 million. This was partially offset by lower share-based compensation expenses of $0.8 million.

Earnings per share for the first fiscal quarter ending December 31, 2022 was negative $0.04 versus positive $0.03 in the prior year period.

As of December 31, 2022, the Company had cash of $684 thousand, digital currency of $10.3 million and total assets of $92.1 million. For more details, please refer to the Company’s filings.

Management Call

Today the Company also announces that it will host a conference call to review first quarter 2023 financial results and provide a corporate update on March 2, 2023, at 4:30 pm ET. Participants are asked to pre-register for the call through the following link:
https://dpregister.com/sreg/10176272/f6166c1c70.

Please note that registered participants will receive their dial in number upon registration and will dial directly into the call without delay. Those without Internet access or unable to pre-register may dial in by calling: 1-844-282-4703 (U.S. toll free), 1-412-317-5624 (international) or 1-647-484-8814 (Canadian toll free). All callers should dial in approximately 10 minutes prior to the scheduled start time and ask to be joined into the DMG Blockchain call.

The conference call will also be available through a live webcast found here, and will be available for webcast replay approximately one hour after the end of the call and until June 2, 2023.

A telephonic replay of the call will be available through March 16, 2023, and may be accessed by calling 1-877-344-7529 (U.S. toll free), 1-412-317-0088 (international) or 855-669-9658 (Canadian toll free) and using the access code 1182952.

Although there will be no live Q&A session, management will address pre-submitted questions during the call. Those wishing to submit a question may do so via investors@dmgblockchain.com using the subject line ‘Conference Call Question Submission’ through March 2, 2023 at 2:00 pm ET.

About DMG Blockchain Solutions Inc.

DMG is an environmentally friendly vertically integrated blockchain and cryptocurrency company that manages, operates, and develops end-to-end digital solutions to monetize the blockchain ecosystem. DMG’s sustainable businesses are segmented into two business lines under the Core and Core+ strategies and unified through DMG’s vertical integration.

Future changes in the Bitcoin network-wide mining difficulty rate or Bitcoin hash rate may materially affect the future performance of DMG’s production of Bitcoin, and future operating results could also be materially affected by the price of Bitcoin and an increase in hash rate mining difficulty.
For more information on DMG Blockchain Solutions visit: www.dmgblockchain.com
Follow @dmgblockchain on Twitter and subscribe to DMG's YouTube channel.

For further information, please contact:

DMG Blockchain Solutions Inc.
Email: investors@dmgblockchain.com
Web: www.dmgblockchain.com

Investor Relations Contact:
CORE IR 516-222-2560

For Media Inquiries:
Jules Abraham
CORE IR
917-885-7378
julesa@coreir.com

Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Note Regarding Forward-Looking Information

This news release contains forward-looking information or statements based on current expectations. Forward-looking statements contained in this news release include statements regarding the potential of Core+ strategies and plans, Terra Pool, delivering products that enable the monetization of bitcoin transactions, developing and executing on the Company’s products and services, increasing self-mining, the launch of products and services, events, courses of action, and the potential of the Company’s technology and operations, among others, are all forward-looking information.

Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations, or intentions regarding the future. Such information can generally be identified by the use of forwarding-looking wording such as "may", "expect", "estimate", "anticipate", "intend", "believe" and "continue" or the negative thereof or similar variations. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including but not limited to, market and other conditions, volatility in the trading price of the common shares of the Company, business, economic and capital market conditions; the ability to manage operating expenses, which may adversely affect the Company's financial condition; the ability to remain competitive as other better financed competitors develop and release competitive products; regulatory uncertainties; access to equipment; market conditions and the demand and pricing for products; the demand and pricing of bitcoins; security threats, including a loss/theft of DMG's bitcoins; DMG's relationships with its customers, distributors and business partners; the inability to add more power to DMG's facilities; DMG's ability to successfully define, design and release new products in a timely manner that meet customers' needs; the ability to attract, retain and motivate qualified personnel; competition in the industry; the impact of technology changes on the products and industry; failure to develop new and innovative products; the ability to successfully maintain and enforce our intellectual property rights and defend third-party claims of infringement of their intellectual property rights; the impact of intellectual property litigation that could materially and adversely affect the business; the ability to manage working capital; and the dependence on key personnel. DMG may not actually achieve its plans, projections, or expectations. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the demand for its products, the ability to successfully develop software, that there will be no regulation or law that will prevent the Company from operating its business, anticipated costs, the ability to secure sufficient capital to complete its business plans, the ability to achieve goals and the price of bitcoin. Given these risks, uncertainties, and assumptions, you should not place undue reliance on these forward-looking statements. The securities of DMG are considered highly speculative due to the nature of DMG's business. For further information concerning these and other risks and uncertainties, refer to the Company’s filings on www.SEDAR.com. In addition, DMG’s past financial performance may not be a reliable indicator of future performance.

Factors that could cause actual results to differ materially from those in forward-looking statements include, failure to obtain regulatory approval, the continued availability of capital and financing, equipment failures, lack of supply of equipment, power and infrastructure, failure to obtain any permits required to operate the business, the impact of technology changes on the industry, the impact of Covid-19 or other viruses and diseases on the Company's ability to operate, secure equipment, and hire personnel, competition, security threats including stolen bitcoins from DMG or its customers, consumer sentiment towards DMG's products, services and blockchain technology generally, failure to develop new and innovative products, litigation, adverse weather or climate events, increase in operating costs, increase in equipment and labor costs, decrease in the price of Bitcoin, failure of counterparties to perform their contractual obligations, government regulations, loss of key employees and consultants, and general economic, market or business conditions. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The reader is cautioned not to place undue reliance on any forward-looking information. The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Additionally, the Company undertakes no obligation to comment on the expectations of or statements made by third parties in respect of the matters discussed above.

DMG Blockchain Solutions Inc.
Consolidated Statements of Loss and Comprehensive Loss
(Expressed in Canadian Dollars)
(Unaudited)

DMG Blockchain Solutions Inc.
Consolidated Statements of Financial Position
(Expressed in Canadian Dollars)

DMG Blockchain Solutions Inc.
Consolidated Statements of Cash Flows
(Expressed in Canadian Dollars)
(Unaudited)