London-listed Argo Blockchain (ARB.L), which is focused on large-scale cryptocurrency mining, swung to a profit in 2020 on strong revenue growth as bitcoin continues to rally.
Argo’s net profit for 2020 was £1.7m ($2.4m), compared to a £0.7m net loss a year prior, as revenue increased 120% to £19m.
It said the first quarter of 2021 was its most profitable to date, “driven by rise in Bitcoin prices and stable mining difficulty,” with 387 bitcoin mined and revenues of £13.4m. The company was founded in 2017 and went public on the London Stock Exchange in 2018.
Peter Wall, CEO, said: “Argo crossed a major inflexion point in 2020 in its history by achieving full-year profitability on a 120% increase in revenue, our second consecutive year of triple-digit top-line growth.”
The company’s share price has soared in recent months, going from about 5p at the beginning of October to £2.84 in February. It was roughly £1.95 at the time of writing, up 4%.
This has coincided with the volatility of bitcoin (BTC-USD), which hit an all-time high earlier this month, crossing $64,000 (£45,845), up from about $10,000 at the start of October. At the time of writing it was trading at $54,456.473.
The total number of bitcoins mined by Argos rose from 1,330 in 2019 to 2,465 in 2020, an 85% increase in annual production.
WATCH: What are the risks of investing in cryptocurrency?
It said this was “despite challenging market conditions, including bitcoin halving in May 2020 and the global impact of the COVID-19 pandemic.”
As of 31 March, the group held 764 bitcoin and equivalents, valued at £32.6m based on the bitcoin price at that time.
It has also raised £49m in new equity for investment in mining rigs, blockchain and fintech ventures including a significant equity investment in Pluto Digital Assets, a crypto venture capital and technology company, and working capital.
Looking forward, it believes it is “well placed to benefit from robust trading conditions amid buoyant demand for cryptocurrency” and it plans to continue investing in new mining capacity.”
“With a proven management team, world-class mining infrastructure, and strong tailwinds from the industry’s recent growth, the board looks forward to the future with great confidence,” said Wall.
Last week, Argo announced plans for a new cryptocurrency mining facility in West Texas with a focus on renewable energy. This comes amid growing scrutiny of the environmental impact of bitcoin and other cryptocurrencies.
WATCH: What is bitcoin?