Marathon Patent Group Announces 2019 Fiscal Year End Financial Results
March 23 2020 - 5:29PM
Marathon Patent Group, Inc. (NASDAQ:
MARA)
("Marathon" or "Company"), today announced its operating results
for the twelve months ended December 31, 2019, as published in its
Annual Report on Form 10-K filed today with the Securities and
Exchange Commission.
Operating Results for the Year Ended December 31, 2019
- Total revenue was $1.2 million for the year ended December 31,
2019 compared to $1.6 million for the year ended December 31,
2018.
- Operating loss improved to approximately $4.2 million
(inclusive of non-cash expenses) for the year ended December 31,
2019 compared to an operating loss of approximately $12.1 million
(inclusive of non-cash expenses) for the year ended December 31,
2018.
- GAAP net loss improved to $(0.53) per basic and diluted share
for the year ended December 31, 2019 compared to $(2.41) the year
ended December 31, 2018.
- Net cash used in operating activities decreased from
approximately $8.2 million in 2018 to approximately $3.3 million in
2019, an improvement of approximately $4.9 million.
- The Company had approximately $0.7 million of cash and cash
equivalents as of December 31, 2019.
Merrick Okamoto, Chief Executive Officer, stated, “2019 was a
year of tremendous volatility in underlying Bitcoin prices. We
significantly increased our hash rate through adding to our mining
infrastructure and dramatically reduced our costs, the ultimate
profitability of Bitcoin mining is still directly tethered to the
price of Bitcoin. Our 4th Quarter of 2019 was one of transition as
we shut down our Mining operation in October and did not resume
full operations until mid-December. While this reduced our 4th
quarter revenue, our first 2 months of 2020 were the best on record
since we started our Bitcoin Mining operation, producing over
$468,000 of revenue from January 1st through February 29th. Then in
March, Bitcoin experienced a precipitous decline of over 70%. While
Bitcoin mining remains very challenging, we instituted additional
cost savings to further reduce our expenses to do our level best to
be in a position to profit from any future price appreciation
should it come to pass.”
Investor Notice
Investing in our securities involves a high degree of risk.
Before making an investment decision, you should carefully consider
the risks, uncertainties and forward-looking statements described
under "Risk Factors" in Item 1A of our most recent Annual Report on
Form 10-K for the fiscal year ended December 31, 2019. If any of
these risks were to occur, our business, financial condition or
results of operations would likely suffer. In that event, the value
of our securities could decline, and you could lose part or all of
your investment. The risks and uncertainties we describe are not
the only ones facing us. Additional risks not presently known to us
or that we currently deem immaterial may also impair our business
operations. In addition, our past financial performance may not be
a reliable indicator of future performance, and historical trends
should not be used to anticipate results in the
future. Lastly, with the current worldwide situation caused by
COVID-19, there can be no assurances as to when we may see any
recovery in the bitcoin market, and if so, whether any recovery
might be significant.
Forward-Looking Statements
Statements made in this press release include forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934. Forward-looking statements can be identified by the use of
words such as “may,” “will,” “plan,” “should,” “expect,”
“anticipate,” “estimate,” “continue,” or comparable terminology.
Such forward-looking statements are inherently subject to certain
risks, trends and uncertainties, many of which the Company cannot
predict with accuracy and some of which the Company might not even
anticipate and involve factors that may cause actual results to
differ materially from those projected or suggested. Readers are
cautioned not to place undue reliance on these forward-looking
statements and are advised to consider the factors listed above
together with the additional factors under the heading “Risk
Factors” in the Company's Annual Reports on Form 10-K, as may be
supplemented or amended by the Company's Quarterly Reports on Form
10-Q. The Company assumes no obligation to update or supplement
forward-looking statements that become untrue because of subsequent
events, new information or otherwise.
CONTACT INFORMATION
Name: Jason Assad Phone: 678-570-6791 Email:
Jason@marathonpg.com
MARATHON PATENT GROUP, INC. AND
SUBSIDIARIESCONSOLIDATED CONDENSED BALANCE SHEETS(Unaudited)
|
|
|
|
|
December 31, |
|
December 31, |
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
|
$ |
692,963 |
|
|
$ |
2,551,171 |
|
Digital currencies |
|
|
1,141 |
|
|
|
- |
|
Prepaid expenses and other current assets |
|
|
800,024 |
|
|
|
464,006 |
|
Total current assets |
|
|
1,494,128 |
|
|
|
3,015,177 |
|
|
|
|
|
Other assets: |
|
|
|
Property and equipment, net of accumulated depreciation and
impairment charges of $6,157,786 and $4,338,931 for December 31,
2019 and 2018, respectively |
|
|
3,754,969 |
|
|
|
1,034,575 |
|
Right-of-use assets |
|
|
297,287 |
|
|
|
- |
|
Intangible assets, net of accumulated amortization of $136,422 and
$65,245 for December 31, 2019 and 2018, respectively |
|
|
1,073,578 |
|
|
|
1,144,755 |
|
Total other assets |
|
|
5,125,834 |
|
|
|
2,179,330 |
|
TOTAL
ASSETS |
|
$ |
6,619,962 |
|
|
$ |
5,194,507 |
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
Accounts payable and accrued expenses |
|
$ |
1,238,197 |
|
|
$ |
1,235,444 |
|
Mining servers payable |
|
|
513,700 |
|
|
|
- |
|
Current portion of lease liability |
|
|
87,959 |
|
|
|
- |
|
Warrant liability |
|
|
12,849 |
|
|
|
39,083 |
|
Convertible notes payable |
|
|
- |
|
|
|
999,106 |
|
Total current liabilities |
|
|
1,852,705 |
|
|
|
2,273,633 |
|
Long-term liabilities |
|
|
|
Convertible notes payable |
|
|
999,106 |
|
|
|
- |
|
Lease liability |
|
|
120,479 |
|
|
|
- |
|
Total long-term liabilities |
|
|
1,119,585 |
|
|
|
- |
|
Total liabilities |
|
|
2,972,290 |
|
|
|
2,273,633 |
|
|
|
|
|
Commitments and
Contingencies |
|
|
|
|
|
|
|
Stockholders' Equity: |
|
|
|
Preferred stock, $0.0001 par value, 50,000,000 shares authorized,
no shares issued and outstanding at December 31, 2019 and 2018,
respectively |
|
|
- |
|
|
|
- |
|
Common stock, $0.0001 par value; 200,000,000 shares authorized;
8,458,781 and 6,379,992 issued and outstanding at December 31, 2019
and 2018, respectively |
|
|
846 |
|
|
|
638 |
|
Additional paid-in capital |
|
|
109,705,051 |
|
|
|
105,461,396 |
|
Accumulated other comprehensive loss |
|
|
(450,719 |
) |
|
|
(450,719 |
) |
Accumulated deficit |
|
|
(105,607,506 |
) |
|
|
(102,090,441 |
) |
Total stockholders’
equity |
|
|
3,647,672 |
|
|
|
2,920,874 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
$ |
6,619,962 |
|
|
$ |
5,194,507 |
|
|
|
|
|
MARATHON PATENT GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended |
|
|
December 31, |
|
|
|
2019 |
|
|
|
2018 |
|
Revenues |
|
|
|
|
Cryptocurrency mining revenue |
|
$ |
1,185,227 |
|
|
$ |
1,495,402 |
|
Other revenue |
|
|
- |
|
|
|
66,970 |
|
Total
revenues |
|
|
1,185,227 |
|
|
|
1,562,372 |
|
|
|
|
|
|
Operating costs and
expenses |
|
|
|
|
Cost of revenue |
|
|
2,482,181 |
|
|
|
3,351,758 |
|
Impairment of mining equipment |
|
|
- |
|
|
|
2,222,688 |
|
Impairment of leasehold improvements |
|
|
447,776 |
|
|
|
- |
|
Compensation and related taxes |
|
|
1,475,450 |
|
|
|
1,984,301 |
|
Consulting fees |
|
|
130,813 |
|
|
|
639,094 |
|
Professional fees |
|
|
422,335 |
|
|
|
1,216,820 |
|
General and administrative |
|
|
465,783 |
|
|
|
1,374,047 |
|
Break-up fee - issuance of shares to GBV |
|
|
- |
|
|
|
2,850,000 |
|
Total operating expenses |
|
|
5,424,338 |
|
|
|
13,638,708 |
|
Operating
loss |
|
|
(4,239,111 |
) |
|
|
(12,076,336 |
) |
Other income
(expenses) |
|
|
|
|
Other income |
|
|
181,995 |
|
|
|
112,471 |
|
Foreign exchange (loss) gain |
|
|
(11,873 |
) |
|
|
28,918 |
|
Realized gain (loss) on sale of digital currencies |
|
|
36,092 |
|
|
|
(152,485 |
) |
Change in fair value of warrant liability |
|
|
26,234 |
|
|
|
1,699,522 |
|
Change in fair value of mining payable |
|
|
507,862 |
|
|
|
- |
|
Amortization of debt discount |
|
|
- |
|
|
|
(2,290,028 |
) |
Interest income |
|
|
33,651 |
|
|
|
14,230 |
|
Interest expense |
|
|
(51,915 |
) |
|
|
(81,482 |
) |
Total other income
(expenses) |
|
|
722,046 |
|
|
|
(668,854 |
) |
Loss before income
taxes |
|
$ |
(3,517,065 |
) |
|
$ |
(12,745,190 |
) |
Income tax expense |
|
|
- |
|
|
|
(69,134 |
) |
Net loss attributable
to common stockholders |
|
$ |
(3,517,065 |
) |
|
$ |
(12,814,324 |
) |
|
|
|
|
|
Net loss per share,
basic and diluted: |
|
$ |
(0.53 |
) |
|
$ |
(2.41 |
) |
Weighted average
shares outstanding, basic and diluted: |
|
|
6,664,238 |
|
|
|
5,315,944 |
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(3,517,065 |
) |
|
$ |
(12,814,324 |
) |
Other comprehensive
income: |
|
|
|
|
Unrealized gain on foreign currency translation |
|
|
- |
|
|
|
15 |
|
Comprehensive loss
attributable to Marathon Patent Group, Inc. |
|
$ |
(3,517,065 |
) |
|
$ |
(12,814,309 |
) |
MARATHON PATENT GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
|
|
|
|
|
|
|
|
|
For the Years Ended |
|
December 31, |
|
|
|
2019 |
|
|
|
2018 |
|
CASH FLOWS FROM
OPERATING ACTIVITIES |
|
|
|
Net loss |
|
$ |
(3,517,065 |
) |
|
$ |
(12,814,324 |
) |
Adjustments to reconcile net
loss to net cash (used in) operating activities: |
|
|
|
Depreciation |
|
|
923,304 |
|
|
|
2,003,695 |
|
Amortization of patents and website |
|
|
71,177 |
|
|
|
66,017 |
|
Realized (gain) loss on sale of digital currencies |
|
|
(36,092 |
) |
|
|
152,485 |
|
Change in fair value of warrant liability |
|
|
(26,234 |
) |
|
|
(1,699,522 |
) |
Change in fair value of mining payable |
|
|
(507,862 |
) |
|
|
- |
|
Impairment of mining equipment |
|
|
- |
|
|
|
2,222,688 |
|
Impairment of leasehold improvements |
|
|
447,776 |
|
|
|
- |
|
Stock based compensation |
|
|
933,682 |
|
|
|
1,425,683 |
|
Amortization of debt discount |
|
|
- |
|
|
|
2,290,028 |
|
Amortization of right-of-use assets |
|
|
82,840 |
|
|
|
- |
|
Bad debt allowance |
|
|
- |
|
|
|
6,826 |
|
Break-up fee - issuance of shares to GBV |
|
|
- |
|
|
|
2,850,000 |
|
Changes in operating assets
and liabilities: |
|
|
|
Digital currencies |
|
|
(1,185,227 |
) |
|
|
(1,495,402 |
) |
Lease liability |
|
|
(72,548 |
) |
|
|
- |
|
Litigation liability |
|
|
- |
|
|
|
(2,150,000 |
) |
Prepaid expenses and other assets |
|
|
(435,159 |
) |
|
|
(371,151 |
) |
Accounts payable and accrued expenses |
|
|
2,753 |
|
|
|
(725,594 |
) |
Net cash used in operating activities |
|
|
(3,318,655 |
) |
|
|
(8,238,571 |
) |
CASH FLOWS FROM
INVESTING ACTIVITIES |
|
|
|
Sale of digital currencies |
|
|
1,220,178 |
|
|
|
1,342,917 |
|
Acquisition of patents |
|
|
- |
|
|
|
(250,000 |
) |
Purchase of property and equipment |
|
|
(5,225 |
) |
|
|
(5,251,719 |
) |
Net cash provided by (used in) investing activities |
|
|
1,214,953 |
|
|
|
(4,158,802 |
) |
CASH FLOWS FROM
FINANCING ACTIVITIES |
|
|
|
Proceeds from issuance of common
stock/At-the-market offering |
|
|
255,893 |
|
|
|
- |
|
Offering costs for the issuance of common
stock/At-the-market offering |
|
|
(10,399 |
) |
|
|
- |
|
Net cash provided by financing activities |
|
|
245,494 |
|
|
|
- |
|
|
|
|
|
Effect of foreign exchange
rate changes |
|
|
- |
|
|
|
15 |
|
|
|
|
|
Net decrease in cash and cash
equivalents |
|
|
(1,858,208 |
) |
|
|
(12,397,358 |
) |
Cash and cash
equivalents — beginning of period |
|
|
2,551,171 |
|
|
|
14,948,529 |
|
Cash and cash
equivalents — end of period |
|
$ |
692,963 |
|
|
$ |
2,551,171 |
|
|
|
|
|
Supplemental schedule
of non-cash investing and financing activities: |
|
|
|
Par value adjustment due to reverse split |
|
$ |
1 |
|
|
$ |
- |
|
Conversion of Series E Preferred Stock to common stock |
|
$ |
- |
|
|
$ |
551 |
|
Common stock issued for acquisition of patents |
|
$ |
- |
|
|
$ |
960,000 |
|
Common stock issued for purchase of assets |
|
$ |
3,064,687 |
|
|
$ |
- |
|
Common stock issued for note conversion |
|
$ |
- |
|
|
$ |
3,055,588 |
|
Restricted stock issuance |
|
$ |
15 |
|
|
$ |
44 |
|
Mining servers payable |
|
$ |
1,021,562 |
|
|
$ |
- |
|
Warrants exercised into common shares |
|
$ |
- |
|
|
$ |
55,791 |
|
MARA (NASDAQ:MARA)
Historical Stock Chart
From Aug 2024 to Sep 2024
MARA (NASDAQ:MARA)
Historical Stock Chart
From Sep 2023 to Sep 2024