Iris Energy (IREN) - 2024 Q1 - Quarterly Report

Financial Performance - The Group reported a loss of $171,871,000 for the year ended 30 June 2023, a significant improvement from a loss of $419,770,000 in the previous year[15] - The company reported a loss after income tax expense of $171,871,000 for the year, a reduction in loss compared to $419,770,000 in the previous year[36] - Total comprehensive loss for the year was $185,512,000, compared to $443,323,000 in the prior year, reflecting an improvement of approximately 58%[36] - Loss before income tax expense for the year ended 30 June 2023 was $169,481,000, a significant improvement from a loss of $417,046,000 in the previous year[150] - The income tax expense for the year ended 30 June 2023 was $2,390,000, compared to $2,724,000 for the year ended 30 June 2022[150] - Basic and diluted earnings per share for the year ended 30 June 2023 were both (313.77) cents, compared to (1,025.30) cents in 2022[199] Revenue and Mining Operations - Bitcoin mining revenue increased to $75,509,000 for the year ended June 30, 2023, compared to $59,037,000 for the previous year, representing a growth of approximately 28%[36] - For the year ended 30 June 2023, Iris Energy Limited reported receipts from Bitcoin mining activities of $78,423,000, an increase of 33% from $59,037,000 in 2022[40] - The number of Bitcoins earned from mining rose to 3,259, up from 1,398 in the prior year, indicating a significant increase of about 133%[36] - The Group generated 100% of Bitcoin mining revenues through two Bitcoin mining pools for the year ended June 30, 2023[142] Financial Position and Assets - Cash and cash equivalents decreased to $68,894,000 as of June 30, 2023, down from $109,970,000 in the previous year[37] - Total assets decreased to $332,074,000 from $570,460,000, indicating a decline of about 42%[37] - Total liabilities were reduced to $26,713,000 from $133,098,000, showing a decrease of approximately 80%[37] - As of 30 June 2023, the Group had net current assets of $65,229,000, compared to $75,148,000 in 2022, reflecting a decrease of 13%[48] - Non-current assets in North America decreased from US$406,820,000 in 2022 to US$241,969,000 in 2023, a decline of approximately 40.5%[143] Capital Management and Financing - The company raised gross proceeds of $41,581,452.20 by issuing 11,454,324 shares under a committed equity facility with B. Riley Principal Capital II, LLC[17] - A total of $1,802,218.80 was raised through the sale of 388,845 shares in June 2023, settled in July 2023[17] - The Group raised $41,581,000 through the issuance of shares under a committed equity facility during the year[189] - The Group's net debt position is calculated as total borrowings less cash and cash equivalents, reflecting ongoing capital management strategies[194] Operational Developments - Iris Energy developed and operated Bitcoin mining data centers at three sites in British Columbia, Canada, and one in Childres, Texas, USA[13] - Iris Energy continues to explore market expansion opportunities and new strategies in the renewable energy sector[13] - The Group aims to expand its operations with the continued development of a 600MW site at Childress, Texas[59] - The strategy to mitigate risks includes improving operational efficiency and securing additional financing through debt and equity capital raisings[50] Impairments and Provisions - An impairment of $12,961,000 was recorded for mining hardware prepayments, with $11,301,000 related to the utilization of prepayments under a contract with Bitmain[156] - Total impairment expense for the year ended June 30, 2023 amounted to $105,172,000, including $25,700,000 related to mining hardware[173] - Non-refundable sales tax provisions rose to $6,172,000 from $2,469,000 year-over-year, reflecting ongoing audits by the Canada Revenue Agency[180] Market and Risk Factors - The Group's financial position reflects ongoing challenges in the cryptocurrency market, impacting overall performance[15] - The Group's future success is closely tied to Bitcoin's market value and mining difficulty, with potential impacts from the upcoming halving event expected in Q4 FY2024[49] - The Group is exposed to market risk from daily volatility in Bitcoin prices and variations in foreign exchange rates[200] - Liquidity and capital risk may arise due to the nature of operations and the need for capital expenditure[200] Other Financial Information - There were no dividends paid, recommended, or declared during the current or previous financial year[14] - The Group did not hold any Bitcoin as of June 30, 2023, compared to nil on June 30, 2022[75] - Other income increased significantly from US$12,000 in 2022 to US$3,137,000 in 2023, primarily due to a net gain on disposal of other assets of US$3,117,000[144] - Total other operating expenses increased from US$11,705,000 in 2022 to US$18,822,000 in 2023, reflecting a rise of about 60.5%[147]