Mawson Infrastructure Group, Inc. Q3 FY2022 earnings call

• Mawson has three business lines: self-mining, hosting colocation, and energy markets. - Sold Georgia facility to CleanSpark for ~$40 million, resulting in low net debt and fully funded major facilities for expansion. - Record revenue of $28.3 million YTD, up 160% YOY; gross profit $10 million, up 20% YOY; non-GAAP EBITDA $8.8 million, up 203% YOY. - Expect installed operating capacity to rise to 4.5 exahash by Q1 2023 and 8 exahash by Q4 2023. - Majority of energy from carbon-free nuclear energy, avoided over 24,000 tons of CO2 emissions in 2022.

Mawson Infrastructure Group Inc. has three business segments. The self-mining business generated $5.9 million in Q3 2022. The hosting colocation business generated $5.7 million in Q3 2022, a 58% increase from Q2 2022. The energy markets program generated $6.3 million in Q3 2022. Year-to-date revenue was $28.3 million, up 160% year-on-year. Gross profit was $10 million, up 20% year-on-year. Non-GAAP EBITDA was $8.8 million, up 203% year-over-year. Bitcoin produced for self-mining increased 12% to 282 coins.

• Expect installed operating capacity to reach 4.5 exahash by Q1 2023 and 8 exahash by Q4 2023. - Hosting colocation business anticipated to grow from 100 megawatts contracted to 200 megawatts by Q4 2023. - Midland expansion fully funded; Sharon site expected to have first 12 megawatts energized in late Q4 2022.

• Risk of not qualifying hosting customers properly due to past issues with other miners. - Uncertainty around Bitcoin price affecting hash rate targets and equipment acquisition decisions. - Consideration of Texas asset as non-core and potential sale/refocus.

Q: Color on hosting demand environment right now, especially in regards to the Sharon and Pennsylvania state?

A: James Manning discussed inbound inquiries from orphan miners but being cautious about taking on customers without proper capital structure.

Q: How are you thinking about your growth timeline, given the lower Bitcoin levels right now? Is there any risk to achieving your hash rate targets, if Bitcoin hovers around $15,000 or $17,000?

A: James Manning mentioned being profitable at $15-16k levels, focusing on infrastructure build-out and considering equipment payback periods.

Q: What do you think your CapEx ballpark will be to finish Sharon on, say, a per megawatt basis?

A: Liam Wilson stated $250,000 per megawatt for Sharon, with efficiencies in modular data centers and transformers.

Q: Have you thought about maybe a stock buyback or raise to eliminate dilution and increase insider ownership?

A: James Manning said capital allocation is a Board decision, with strategies being considered including potential buybacks.

Q: What is your plan for meeting the NASDAQ share compliance?

A: James Manning mentioned preparing a reverse split to get back into NASDAQ compliance, expected in December and completed by February-March.

Q: How will Mawson earn from its Bitcoin mining in the longer term?

A: James Manning stated earnings come from hosting, Bitcoin mining, and energy markets, with energy markets supporting low power costs for mining.

Q: How much Bitcoin is held on the balance sheet?

A: Ariel Sivikofsky said none, as Bitcoin is sold daily.

Q: What does the ROFO on the MIGI asset mean?

A: James Manning explained ROFO means CleanSpark has the first right to look at other U.S. assets if Mawson decides to dispose of them.