Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2021shares | |
Document Information [Line Items] | |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Shell Company Report | false |
Document Transition Report | false |
Document Period End Date | Dec. 31, 2021 |
Entity File Number | 001-40816 |
Entity Registrant Name | Argo Blockchain Plc |
Entity Incorporation, State or Country Code | X0 |
Entity Address, Country | GB |
Entity Address, Address Line One | 9th Floor |
Entity Address, Adress Line Two | 16 Great Queen Street |
Document Accounting Standard | International Financial Reporting Standards |
Entity Address, City or Town | London |
Entity Address, Postal Zip Code | WC |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 468,082,335 |
Entity Central Index Key | 0001841675 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Auditor Name | PKF Littlejohn LLP |
Auditor Location | London, England |
Auditor Firm ID | 2814 |
American Depository Shares [Member] | |
Document Information [Line Items] | |
Title of 12(b) Security | American Depository Shares, each representing ten ordinary shares |
Trading Symbol | ARBK |
Security Exchange Name | NASDAQ |
Senior Notes [Member] | |
Document Information [Line Items] | |
Title of 12(b) Security | 8.75% Senior Notes due 2026 |
Trading Symbol | ARBKL |
Security Exchange Name | NASDAQ |
Common stock | |
Document Information [Line Items] | |
Title of 12(b) Security | Ordinary shares, nominal value of £0.001 per share |
No Trading Symbol Flag | true |
Security Exchange Name | NASDAQ |
Business Contact [Member] | |
Document Information [Line Items] | |
Entity Address, Country | GB |
Entity Address, Address Line One | 9th Floor |
Entity Address, Adress Line Two | 16 Great Queen Street |
Contact Personnel Name | Alex Appleton |
Entity Address, City or Town | London |
Entity Address, Postal Zip Code | WC |
City Area Code | 788 |
Local Phone Number | 400 3403 |
STATEMENT OF FINANCIAL POSITION
STATEMENT OF FINANCIAL POSITION - GBP (£) | Dec. 31, 2021 | Dec. 31, 2020 |
Non-current assets | ||
Investments at fair value through income or loss | £ 403,000 | £ 1,393,000 |
Investments accounted for using the equity method | 13,817,000 | 0 |
Intangible assets, net of accumulated amortization of 571,000 and 303,000 for December 31, 2021 and 2020 respectively | 5,604,000 | 368,000 |
Property and equipment, net of accumulated depreciation of 18,572,000 and 7,491,000 for December 31, 2021 and 2020 respectively | 111,604,000 | 10,524,000 |
Right of use assets, net of accumulated depreciation of 8,000 and nil for December 31, 2021 and 2020 respectively | 350,000 | 7,379,000 |
Other receivables | 4,115,000 | |
Total non-current assets | 131,778,000 | 23,779,000 |
Current assets | ||
Trade and other receivables | 63,359,000 | 2,175,000 |
Digital assets | 80,759,000 | |
Cash and cash equivalents | 11,803,000 | 2,051,000 |
Total current assets | 155,921,000 | 8,864,000 |
Total assets | 287,699,000 | 32,643,000 |
Equity | ||
Common stock, 0.001 par value | 468,000 | 303,000 |
Share Premium | 139,581,000 | 1,541,000 |
Share based payment reserve | 1,905,000 | 75,000 |
Fair value reserve | 414,000 | |
Accumulated other comprehensive income | 33,000 | 443,000 |
Other comprehensive income of equity accounted associates | 6,571,000 | |
Accumulated surplus | 52,838,000 | 21,965,000 |
Total equity | 201,810,000 | 24,327,000 |
Current liabilities | ||
Trade and other payables | 15,245,000 | 936,000 |
Contingent Consideration | 8,071,000 | |
Loans and borrowings | 23,391,000 | |
Income tax | 7,679,000 | |
Deferred tax | 286,000 | |
Lease liability | 7,000 | 3,470,000 |
Total current liabilities | 54,679,000 | 4,406,000 |
Non-current liabilities | ||
Deferred tax | 541,000 | |
Issued debt - bond | 26,908,000 | |
Loans | 3,391,000 | |
Lease liability | 370,000 | 3,910,000 |
Total liabilities | 85,889,000 | 8,316,000 |
Total equity and liabilities | £ 287,699,000 | £ 32,643,000 |
STATEMENT OF FINANCIAL POSITI_2
STATEMENT OF FINANCIAL POSITION (Parenthetical) - GBP (£) | Dec. 31, 2021 | Dec. 31, 2020 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Intangible assets | £ 5,604,000 | £ 368,000 |
Property, plant and equipment | 111,604,000 | 10,524,000 |
Right of use assets, net of accumulated depreciation of 8,000 and nil for December 31, 2021 and 2020 respectively | £ 350,000 | £ 7,379,000 |
Common Stock | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Par value per share | £ 0.001 | £ 0.001 |
Accumulated depreciation and amortization | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Intangible assets | £ (571,000) | £ (303,000) |
Property, plant and equipment | (18,572,000) | (7,491,000) |
Right of use assets, net of accumulated depreciation of 8,000 and nil for December 31, 2021 and 2020 respectively | £ (8,000) | £ 0 |
STATEMENT OF COMPREHENSIVE INCO
STATEMENT OF COMPREHENSIVE INCOME - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
GROUP STATEMENT OF COMPREHENSIVE INCOME | ||
Revenues | £ 74,204 | £ 18,957 |
Direct costs | (11,057) | (11,210) |
Depreciation of Mining Equipment | (11,129) | (5,896) |
Change in fair value of digital currencies | 1,191 | 2,342 |
Realized gain/(loss) on sale of digital assets | 437 | (272) |
Gross profit | 53,646 | 3,921 |
Consulting fees | (684) | (690) |
Professional fees | (1,533) | (114) |
General and administrative | (6,081) | (1,363) |
Reversal of credit loss provision | 447 | |
Share based payment charge | (1,938) | (331) |
Foreign exchange | (589) | (271) |
Total operating expenses | (10,825) | (2,322) |
Operating profit | 42,821 | 1,599 |
Fair value revaluation of variable consideration | 236 | |
Fair value gain/(loss) of investments | 183 | |
Loss on sale of investment | (629) | |
Finance costs - net | (2,142) | (157) |
Equity accounted loss from associate | (1,198) | |
Income before income taxes | 39,271 | 1,442 |
Tax expense | (8,506) | |
Net income/(loss) | 30,765 | 1,442 |
Items which may be subsequently reclassified to profit or loss: | ||
- Exchange differences on translation of foreign operations | (410) | 265 |
- Equity accounted OCI from associate | 6,571 | |
- Fair value gains on intangible digital assets | 414 | |
Total other comprehensive income, net of tax | 6,575 | 265 |
Total comprehensive income attributable to the equity holders of the Company | £ 37,340 | £ 1,707 |
Earnings per share attributable to equity owners (pence) | ||
Basic earnings per share | £ 7.7 | £ 0.5 |
Diluted earnings per share | £ 7.4 | £ 0.4 |
STATEMENT OF CHANGES IN EQUITY
STATEMENT OF CHANGES IN EQUITY - GBP (£) £ in Thousands | Common Stock | Additional paid-in capital | Accumulated other comprehension income | Share premium. | Share based payment reserve | Fair value reserve | Currency translation reserve | Accumulated surplus / (deficit) | Total |
Balance at the beginning at Dec. 31, 2019 | £ 294 | £ 25,252 | £ 25,252 | £ 178 | £ (4,986) | £ 20,738 | |||
Total comprehensive income for the period: | |||||||||
Profit (Loss) for the period | 1,442 | 1,442 | |||||||
Other comprehensive income | 265 | 265 | |||||||
Total comprehensive income for the period | 265 | 1,442 | 1,707 | ||||||
Transactions with equity owners: | |||||||||
Shares to be issued | 10 | 1,540 | 1,540 | 1,550 | |||||
Stock based compensation charge | £ 332 | 332 | |||||||
Cancellation of share premium | (25,252) | 25,252 | |||||||
Share options/warrants charges | 332 | 332 | |||||||
Share based payments lapsed/expired | (257) | 257 | |||||||
Total transactions with equity owners | 10 | (23,712) | 75 | 25,509 | 1,882 | ||||
Balance at the end at Dec. 31, 2020 | 304 | £ 1,540 | 1,540 | 75 | 443 | 21,965 | 24,327 | ||
Total comprehensive income for the period: | |||||||||
Profit (Loss) for the period | 30,765 | 30,765 | |||||||
Other comprehensive income | £ 6,571 | £ 414 | (410) | 6,575 | |||||
Total comprehensive income for the period | 6,571 | 414 | (410) | 30,765 | 37,340 | ||||
Transactions with equity owners: | |||||||||
Gross share capital | 164 | 150,977 | 151,141 | ||||||
Issue costs of common stock | (12,936) | (12,936) | |||||||
Stock based compensation charge | 1,938 | 1,938 | |||||||
Share options/warrants exercised | (108) | 108 | |||||||
Share options/warrants charges | 1,938 | 1,938 | |||||||
Total transactions with equity owners | 164 | 138,041 | 1,830 | (108) | 140,143 | ||||
Balance at the end at Dec. 31, 2021 | £ 468 | £ 6,571 | £ 139,581 | £ 1,905 | £ 414 | £ 33 | £ 52,838 | £ 201,810 |
STATEMENT OF CASH FLOWS
STATEMENT OF CASH FLOWS - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities | ||
Profit before tax | £ 39,271 | £ 1,442 |
Adjustments for: | ||
Depreciation and Amortization | 11,511 | 6,027 |
Foreign exchange movements | 589 | 271 |
Loss on disposal of tangible assets | 66 | |
Finance cost | 2,142 | 157 |
Loss on sale of investment | 629 | |
Fair value change in digital assets through profit or loss | (1,628) | (2,342) |
Impairment of intangible digital assets | 535 | |
Investment fair value movement | (183) | |
Share of loss from associate | 1,198 | |
Non-cash settlement of management fees | (1,561) | |
Revaluation of contingent consideration | (236) | |
Derecognition of contingent consideration | (352) | |
Stock based compensation | 1,938 | 332 |
Working capital changes: | ||
(Increase)/decrease in trade and other receivables | (13,628) | (90) |
Increase/(decrease) in trade and other payables | 12,289 | (2,107) |
(Increase) in digital assets | (80,331) | (1,236) |
Net cash (used in)/generated from operating activities | (27,817) | 2,520 |
Investing activities | ||
Investment at fair value through profit or loss | (220) | |
Acquisition of subsidiaries, net of cash acquired | (664) | |
Investment in associate | (7,353) | |
Foreign exchange on investing activities | 48 | |
Interest received | 1 | |
Proceeds from sale of investment | 772 | |
Purchase of tangible fixed assets | (78,972) | (1,808) |
Proceeds from disposal of tangible fixed assets | 704 | |
Purchase of digital assets | (15,009) | |
Proceeds from sale of digital assets | 11,308 | |
Mining equipment prepayment | (47,426) | |
Net cash used in investing activities | (137,564) | (1,055) |
Financing activities | ||
Increase/(decrease) in loans | 22,239 | (968) |
Lease payments | (7,379) | |
Loan repayments | (1,196) | |
Interest paid | (122) | (157) |
Proceeds from debt issue - net of issue costs | 26,908 | |
Proceeds from shares issued - net of issue costs | 134,684 | 1,550 |
Net cash generated from/(used in) financing activities | 175,133 | 425 |
Net increase in cash and cash equivalents | 9,752 | 1,890 |
Cash and cash equivalents at beginning of period | 2,051 | 161 |
Cash and cash equivalents at end of period | £ 11,803 | £ 2,051 |
STATEMENT OF CASH FLOWS (Parent
STATEMENT OF CASH FLOWS (Parenthetical) - GBP (£) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Material non-cash movements: | ||
Mortgages on two properties | £ 5,720,000 | |
Forgiveness of prepayments | 4,656,000 | |
Common stock issued to acquire DPN LLC | 3,521,000 | |
Deferred contingent consideration included within liabilities | £ 8,659,000 | |
Number of Polkadot satisfied in respect of the acquisition of shares in Pluto Digital PLC | 75,000 | |
Fair value of Polkadot satisfied in respect of the acquisition of shares in Pluto Digital PLC | £ 1,092,000 | |
Purchase and sales of digital assets | 12,792,000 | |
Current loans and borrowings | (23,391,000) | |
Current lease liability | (7,000) | £ (3,470,000) |
Non-current issued debt - bonds | (26,908,000) | |
Non-current loans and borrowings | (3,391,000) | |
Non-current liability | (370,000) | (3,910,000) |
Cash and cash equivalents | 11,803,000 | 2,051,000 |
Total net debt | (42,264,000) | (5,329,000) |
Digital assets | 80,759,000 | |
Net funds/(debt) | 65,403,000 | £ 691,000 |
Legal settlement re Crypto mining management fees in which it received digital assets (BTC) | £ 1,561,000 |
ORGANIZATION AND DESCRIPTION OF
ORGANIZATION AND DESCRIPTION OF BUSINESS | 12 Months Ended |
Dec. 31, 2021 | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | 1. Argo Blockchain PLC (“the company”) is a public company, limited by shares, and incorporated in England and Wales. The registered office is 9th Floor, 16th Great Queen Street, London, England, WC2B 5DG. The company was incorporated on 5 December 2017 as GoSun Blockchain Limited and changed its name to Argo Blockchain Limited on 21 December 2017. Also on 21 December 2017, the company re-registered as a public company, Argo Blockchain plc. Argo Blockchain plc acquired a 100% subsidiary, Argo Innovation Labs Inc. (together “the Group”), incorporated in Canada, on 12 January 2018. On 4 March 2021 the Group acquired 100% of the common stock of DPN LLC and was merged into new US entity Argo Innovation Facilities (US) Inc (also 100% owned by Argo Blockchain plc) On 11 May 2021 the Group acquired 100% of the common stock of 9377-2556 Quebec Inc and 9366-5230 Quebec Inc. These are held by Argo Innovation Labs Inc. (Canada). The principal activity of the group is that of crypto asset mining. The common shares of the Group are listed under the trading symbol ARB on the London Stock Exchange. The American Depositary Receipt of the Group are listed under the trading symbol ARBK on Nasdaq. The Group bond is listed on the Nasdaq Global Select Market under the trading symbol ARBKL The financial statements cover the year ended 31 December 2021. |
BASIS OF PREPARATION
BASIS OF PREPARATION | 12 Months Ended |
Dec. 31, 2021 | |
BASIS OF PREPARATION | |
BASIS OF PREPARATION | 2. The consolidated financial statements, including comparatives, have been prepared in accordance with international financial reporting standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations issued by the International Financial Reporting Standards Interpretations Committee (“IFRIC”). The financial statements have been prepared under the historical cost convention, except for the measurement to fair value certain financial and digital assets and financial instruments as described in the accounting policies below. The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest thousand GBP. Argo Innovations Labs Inc., 9377-2556 Quebec Inc, and 9366-5230 Quebec Inc.’s functional currency is Canadian Dollars; Argo Innovation Facilities (US) Inc.’s functional currency is United States Dollars; all entries from these entities are presented in the Group’s presentational currency of Sterling. Where the subsidiaries functional currency is different from the parent, the assets and liabilities presented are translated at the closing rate as at the Statement of Financial Position date. Income and expenses are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions). The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the group accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 6. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
SIGNIFICANT ACCOUNTING POLICIES | 3. The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. Going Concern The preparation of consolidated financial statements requires an assessment on the validity of the going concern assumption. The Directors have reviewed cash flow projections for a period to 31 December 2023. The Group currently has an increasing level of revenues and margin as crypto prices have increased significantly at the end of the year and post the year end. In making their assessment of going concern, the Directors acknowledge that the Group has increasing cash reserves from the exercise of share options and warrants, two private placements and the IPO on Nasdaq during the year. Therefore, the Directors confirm that the Group holds sufficient funds to ensure the Group continues to meet its obligations as they fall due for a period of at least one year from date of approval of these Financial Statements. In addition to cash reserves, the Group also holds £89m of Bitcoin at the year end. As a crypto currency miner, and principally that of mining Bitcoin, the Directors have considered the risk around the price of Bitcoin. The cost to mine each Bitcoin in 2021 was less than £6k and as such there can be a significant fall in Bitcoin price before the Group has a significant issue. Given our relatively low cost of power, we are better positioned than many of our competitors to survive a significant drop in Bitcoin price. In this scenario, our relative share of the global hashrate would increase and we would mine more Bitcoin. As such the Directors have considered the sensitivity around BTC market price and have anticipated and modelled a significant fall in Bitcoin price still allowing the Group to mine at a profitable level. As a result of our diversification into non mining activities, via Argo Labs we consider that we are diversifying and thereby reducing our risk profile as a Group. Since Argo Labs invests in other crypto currencies besides Bitcoin this diversification is at an operating level and a commodity level. The Directors have considered the period to 31 December 2023 as a reasonable time period given the variable outlook of cryptocurrencies. Please see the net debt tables under the cashflows for further information of the Groups exposure to liabilities and net position at the year end. The Directors have considered the impacts of Covid-19 and conclude that there are no material factors that are likely to affect the ability of the Group to continue as a going concern. Accordingly, the Board believes it is appropriate to adopt the going concern basis in the preparation of the Financial Statements. Revenue Recognition Mined income: The Group recognized revenue during the period in relation to mined crypto. The Group enters into contracts with the mining pool. The performance obligation is identified to be the delivery of crypto into the Group’s wallet once an algorithm has been solved. The transaction price is the fair value of crypto mined, being the fair value per the prevailing market rate for that crypto currency on the transaction date, and this is allocated to the number of crypto mined. These criteria for performance obligation are assessed to have occurred once the crypto has been received in the Group’s wallet. Mining earnings are made up of the baseline block reward and transaction fees of between 5% to 10%, however, these are bundled together in the daily deposits from mining and therefore are not capable of being analysed separately. Management fees: The Group recognized management fees on the services provided to third parties for management of mining machines on their behalf, ensuring the machines are optimised and mining as efficiently as possible. The performance obligation is identified as the services are performed, and thus revenue is recorded over time. Direct Costs Direct costs of mining revenue are comprised of the fees we pay to third parties to host, operate and maintain our mining machines and utility costs. Where we transitioned to a model in which we own and operate our mining facilities, costs of revenue includes direct facilities costs including utility costs, and personnel costs, including compensation and benefits, associated with operating these owned mining facilities. Basis of consolidation Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary. The group consists of Argo Blockchain plc and its wholly owned subsidiaries Argo Innovation Labs Inc, Argo Innovation Facilities (US) Inc, Argo Innovation Labs Inc., 9366-5230 and 9377-2556 and Argo Innovation Labs Limited, the latter remaining dormant. Argo Innovation Labs Limited has been dormant since incorporation. In the parent company financial statements, investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment. The consolidated financial statements incorporate those of Argo Blockchain plc and all of its subsidiaries (i.e. entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes. On the basis that Argo Innovation Labs Limited was dormant during the year and is immaterial to the Group, it was not included in these consolidated financial statements. All financial statements are made up to 31 December 2021. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group. All intra-group transactions, balances and unrealized gains on transactions between group companies are eliminated on consolidation. Business Combinations The group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquire and the equity interests issued by the group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The group recognises any non-controlling interest in the acquire on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest’s proportionate share of the recognized amounts of acquiree’s identifiable net assets. Acquisition-related costs are expensed as incurred. If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognized in profit or loss. Contingent consideration is classified either as equity or as a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value, with changes in fair value recognized in profit or loss. Associates Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting. Under the equity method, the investment is initially recognized at cost, and the carrying amount is increased or decreased to recognise the investor’s share of the profit or loss of the investee after the date of acquisition. The Group’s investment in associates includes goodwill identified on acquisition. If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognized in other comprehensive income is reclassified to profit or loss where appropriate. The Group’s share of post-acquisition profit or loss is recognized in the income statement, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income with a corresponding adjustment to the carrying amount of the investment. When the Group’s share of losses in an associate equal or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate. The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount adjacent to ‘share of profit/(loss) of associates in the income statement. Gains and losses resulting from upstream and downstream transactions between the Group and its associate are recognized in the Group’s financial statements only to the extent of unrelated investor’s interests in the associates. Unrealized losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group. Dilution gains and losses arising in investments in associates are recognized in the income statement. Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the board of directors that makes strategic decisions. The Directors consider that the Group has only Loans and borrowings and issued debt Loans and borrowings and issued debt are recognized initially at fair value, net of transaction costs incurred. Loans and borrowings and issued debt are subsequently carried at amortised cost; any difference between the proceeds and the redemption value is recognized in the income statement over the period of the borrowings, using the effective interest method. Loans and borrowings and issued debt are removed from the statement of financial position when the obligation specified in the contract is discharged, cancelled or expired. Loans and borrowings and issued debt are classified as current liabilities unless the Group has an unconditional right to defer settlement of a liability for at least 12 months after the end of the reporting period. Intangible assets Intangible fixed assets comprise of the Group's website and digital assets that were not mined by the Group and are held by Argo Labs (our internal team) as investments. The Group's website is recognized at cost and are subsequently measured at cost less accumulated amortization and accumulated impairment losses. Amortization is recorded within administration expenses. Digital assets recorded under IAS 38 have an indefinite useful life initially measured at cost, and subsequently measured at fair value. Argo’s primary business is focused on cryptocurrency mining, and it typically holds mined crypto assets on its balance sheet. Argo Labs is an in-house innovation arm focused on identifying opportunities within the disruptive and innovative sectors of the broader cryptocurrency ecosystem. Argo Labs uses a portion of Argo’s crypto assets to deploy into various blockchain projects. Currently Argo allocates approximately 10% if its holdings to Argo Labs. Increases in the carrying amount arising on revaluation of digital assets are credited to other comprehensive income and shown as other reserves in shareholders’ equity. Decreases that offset previous increases of the same asset are charged in other comprehensive income and debited against the fair value reserve directly in equity; all other decreases are charged to the income statement. The fair value of intangible cryptocurrencies on hand at the end of the reporting period is calculated as the quantity of cryptocurrencies on hand multiplied by price quoted on www.coingecko.com, one of the leading crypto data sources, as at the reporting date. Costs relating to the development of website are capitalised once all the development phase recognition criteria of IAS 38 "Intangible Assets" are met. Amortization is charged on a straight-line basis over the estimated useful life of 5 years. The useful life represents management's view of the expected period over which the Group will receive benefits from the Website, as well as anticipation of future events which may impact their useful life, such as changes in technology. Goodwill is initially measured at cost (being the excess of the consideration transferred and the amount recognized for non-controlling interests and any previous interest held of the net identifiable assets acquires and liabilities assumed). If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the difference is recognized in profit or loss. If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such remeasurement are recognized in profit or loss. Tangible fixed assets Tangible fixed assets comprise of right of use, office equipment, mining and computer equipment, data centres, leasehold improvements and assets under construction. Right of use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjust for any remeasurement of lease liabilities. The cost of the right of use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right of use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets. Office equipment assets are measured at cost, less any accumulated depreciation and impairment losses. Office equipment is depreciated over 3 years on a straight line basis. Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of amortization and any impairment losses. Cost includes the original purchase price of the asset and any costs attributable to bringing the asset to its working condition for its intended use. An item of property, plant and equipment is recognized as an asset if it is probable that future economic benefits associated with the asset will flow to the entity, and the cost of the asset can be measured reliably Data centres and assets under construction: Depreciation on the data centres and assets under construction is recognized so as to write off the cost or valuation of assets less their residual values over their estimated useful lives of 25 years on a straight-line basis from when they are brought into use. Depreciation is recorded in the Income Statement within general administrative expenses once the asset is brought into use. Any land component is not depreciated. Mining and computer equipment and leasehold improvements: Depreciation is recognized so as to write off the cost or valuation of assets less their residual values over their estimated useful lives of 3 years in the case of mining and computer equipment and 5 years in the case of the leasehold improvements, on a straight line basis. Depreciation is recorded in the Statement of Comprehensive Income within direct costs. Management assesses the useful lives based on historical experience with similar assets as well as anticipation of future events which may impact their useful life. Impairment of non-financial assets At each reporting period end date, the Group reviews the carrying amounts of its non-financial assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group and Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Digital assets Digital assets, including tokens and cryptocurrency, do not qualify for recognition as cash and cash equivalents or financial assets, and have an active market which provides pricing information on an ongoing basis. The Group's business model is to mine digital currencies for sale in the ordinary course of business. The Group does not buy or sell digital currencies for third parties, but will move its holdings between digital currencies depending on expected and actual fluctuations in fair values. Although the Group mines for sale in the ordinary course of business, it looks to sell digital assets at a price that will generate the greatest realized gain and at a time when it would need to generate more fiat cash to meet working capital requirements. Thus, the Group may choose not to immediately sell its digital asset holdings after mined. The Group has assessed that it acts in a capacity as a commodity broker-trader as defined in IAS 2, Inventories, in characterising its holding of Digital assets as inventory. If assets held by commodity broker-traders are principally acquired for the purpose of selling in the near future and generating a profit from fluctuations in price or broker-traders’ margin, such assets are accounted for as inventory, and changes in fair value (less costs to sell) are recognized in profit or loss. Digital assets are initially measured at fair value. Subsequently, digital assets are measured at fair value with gains and losses recognized directly in income or loss. Digital assets are included in current assets as management intends to dispose of them within 12 months of the end of the reporting period. Digital assets are cryptocurrencies mined by the Group. Cryptocurrencies not mined by the Group are recorded as Intangible Assets (see note 18). Cash and cash equivalents Cash and cash equivalents comprise cash at bank and in hand and demand deposits with banks and other financial institutions, that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. The Group considers the credit risk on cash and cash equivalents to be limited because the counterparties are banks with high credit ratings assigned by international credit rating agencies. Financial instruments Financial assets: Financial assets are recognized in the Statement of Financial Position when the Group becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories. The classification depends on the nature and purpose of the financial assets and is determined at the time of recognition. Financial assets are subsequently measured at amortised cost, fair value through OCI, or fair value through profit and loss. The classification of financial assets at initial recognition that are debt instruments depends on the financial asset’s contractual cash flow characteristics and the Group’s business model for managing them. The Group initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. In order for a financial asset to be classified and measured at amortised cost, it needs to give rise to cash flows that are ‘solely payments of principal and interest (SPPI)’ on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. The Group’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Subsequent measurement: For purposes of subsequent measurement, financial assets are classified in four categories: ● Financial assets at amortised cost ● Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments) ● Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments) ● Financial assets at fair value through profit or loss Equity Instruments: The Group subsequently measures all equity investments at fair value.. Dividends from such investments continue to be recognized in profit or loss as other income when the Group’s right to receive payments is established. Changes in the fair value of financial assets at FVPL are recognized in other gains/(losses) in the statement of profit or loss as applicable. Financial assets at amortised cost (debt instruments): This category is the most relevant to the Group. The Group measures financial assets at amortised cost if both of the following conditions are met: ● The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and ● The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortised cost are subsequently measured using the effective interest rate (EIR) method and are subject to impairment. Interest received is recognized as part of finance income in the statement of profit or loss and other comprehensive income. Gains and losses are recognized in profit or loss when the asset is derecognized, modified or impaired. The Group’s financial assets at amortised cost include other receivables and cash and cash equivalents. Derecognition: A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognized (i.e., removed from the Group’s consolidated Balance sheet) when: ● The rights to receive cash flows from the asset have expired; or ● The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues to recognise the transferred asset to the extent of its continuing involvement. In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained. Impairment of financial assets: The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original EIR. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms. The Group recognises an allowance for ECLs for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original EIR. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL). For the years ended 31 December 2021 and 2020 the Group has not recognized any ECLs. For other receivables due in less than 12 months, the Group applies the simplified approach in calculating ECLs, as permitted by IFRS 9. Therefore, the Group does not track changes in credit risk, but instead, recognises a loss allowance based on the financial asset’s lifetime ECL at each reporting date. The Group considers a financial asset in default when contractual payments are 90 days past due. However, in certain cases, the Group may also consider a financial asset to be in default when internal or external information indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Group. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows and usually occurs when past due for more than one year and not subject to enforcement activity. At each reporting date, the Group assesses whether financial assets carried at amortised cost are credit impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. The Company has an Intercompany loan due from its 100% Canadian subsidiary for which there is no formal agreement including payment date and therefore it cannot be considered to be in breach of an agreement and accordingly the loan is not subject to adjustments and is maintained at its book value in the financial statements. Financial liabilities: Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs. The Group’s financial liabilities include trade and other payables and loans. Subsequent measurement: The measurement of financial liabilities depends on their classification, as described below: Loans and borrowings and trade and other payables: After initial recognition, interest-bearing loans and borrowings and trade and other payables are subsequently measured at amortised cost using the EIR method. Gains and losses are recognized in the statement of profit or loss and other comprehensive income when the liabilities are derecognized, as well as through the EIR amortization process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit or loss and other comprehensive income. This category generally applies to trade and other payables. Derecognition: A financial liability is derecognized when the associated obligation is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in profit or loss or other comprehensive income. Equity instruments: Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognized as liabilities once they are no longer at the discretion of the group. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Leases At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Group uses the definition of a lease in IFRS 16. The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the end of the lease term or the cost of the right-of-use asset reflects that the Group will exercise a purchase option. In that case the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate. The Group determines its incremental borrowing rate by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased. The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero. Taxation The tax expense represents the sum of tax currently payable or receivable and deferred tax. Current tax: The tax currently payable or receivable is based on taxable profit or loss for the year. Taxable profit or loss differs from net profit or loss as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is |
FINANCIAL RISK FACTORS
FINANCIAL RISK FACTORS | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL RISK FACTORS | |
FINANCIAL RISK FACTORS | 4. The Group’s activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Group’s overall risk management programme seeks to minimise potential adverse effects on the Group’s financial performance. Risk management is undertaken by the Board of Directors. Market Risk The Group is dependent on the state of the cryptocurrency market and general sentiment of crypto assets as a whole. During the year the Group managed the company’s cryptocurrency through a carefully structured active management strategy for all Group held crypto assets. It is designed to protect the Company in the event that crypto prices decrease, but would also have the potential to provide an upside in a rising crypto asset market. Internally, the Argo team exchanged cryptocurrency to fiat currency via a third party digital currency exchange, Satstreet Inc (based in Toronto Canada). As a result of raising money through both debt and equity the Group has not sold a significant proportion of its Bitcoin holding during the year. As a cryptocurrency miner, and principally that of mining Bitcoin, the Directors have considered the risk around the price of Bitcoin. The cost to mine each Bitcoin in 2021 was less than £6k; as such, there can be a significant fall in Bitcoin price before the Group has a significant issue. Given our relatively low cost of power, we are better positioned than many of our competitors to survive a significant drop in Bitcoin price. In this scenario, our relative share of the global hashrate would increase and we would mine more Bitcoin. As such the Directors have considered the sensitivity around BTC market price and have anticipated and modelled a significant fall in Bictoin price still allowing the Group to mine at a profitable level. As a result of our diversification into non mining activities via Argo Labs, we consider that we are diversifying and thereby reducing our risk profile as a Group. Since Argo Labs invests in other cryptocurrencies besides Bitcoin this diversification is at an operating level and a commodity level. The Group is also subject to market fluctuations in foreign exchange rates. The subsidiary (Argo Innovation Labs Inc.) is based in Canada, and transacts in CAD$, USD$ and GBP. 9377-2556 Quebec Inc. and 9366-5230 Quebec Inc. are based in Canada and transact in CAD. Argo Innovations Facilities (US) Inc. is located in the United States of America and transacts in USD. The Group bond is denominated in USD. Cryptocurrency is primarily convertible into fiat through USD currency pairs and through USD denominated stable coins and is the primary method for the Group for conversion into cash. The Group monitors exchange rates on a constant basis and maintains bank accounts in all applicable currency denominations. Foreign currency sensitivity The following tables demonstrate the sensitivity to a reasonable possible change in USD and CAD exchange rates, with all other variables held constant. The impact on the Group’s profit before tax is due to changes in the fair value of monetary assets and liabilities. Change in USD Effect on profit Effect on pre- rate before tax tax equity £’000 £’000 2021 +/-10 % +/-250 +/-87 2020 +/-10 % — — Change in CAD Effect on profit Effect on pre- rate before tax tax equity £’000 £’000 2021 +/-10 % +/-1,611 +/-3,208 2020 +/-10 % +/-614 +/-122 Credit risk Credit risk arises from cash and cash equivalents as well as any outstanding receivables. Management does not expect any losses from non-performance of these receivables. The amount of exposure to any individual counter party is subject to a limit, which is assessed by the Board. The Group considers the credit risk on cash and cash equivalents to be limited because the counterparties are banks with high credit ratings assigned by international credit rating agencies. However, in the UK the banking sector is not currently favourable toward crypto based businesses and as such the Group has opened accounts with a number of Tier 2 banks in order to mitigate the risk of an account been deactivated or closed by the bank. The Company considers the intercompany loan to its subsidiary (Argo Innovation Labs Inc.) to be fully recoverable through review of projected cash flows and acceptance of regular payments directly to the Company's creditors. The carrying amount of financial assets recorded in the financial statements represent the Group’s and Company’s maximum exposure to credit risk. The Group and Company do not hold any collateral or other credit enhancements to cover this credit risk. Liquidity risk Liquidity risk arises from the Group’s management of working capital. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due. The Board updates cashflow projections on a regular basis and closely monitors the cryptocurrency market on a daily basis. Accordingly, the Group’s controls over expenditure are carefully managed, in order to maintain its cash reserves. The Treasury committee meets on a weekly basis to make decisions around future cashflows and working capital requirements. Decisions may include considering debt/equity options alongside selling Bitcoin. The table below analyses the Group’s non-derivative financial liabilities and net-settled derivative financial liabilities into relevant maturity groupings, based on the remaining period at the Statement of Financial Position to the contractual maturity date. Derivative financial liabilities are included in the analysis if their contractual maturities are essential for an understanding of the timing of the cash flows. The amounts disclosed in the table are the contractual undiscounted cash flows. Less than 1 Between 1 and Between 2 year 2 years and 5 years Over 5 years At 31 December 2021 Loans and borrowings 23,901 2,188 693 — Lease liabilities 21 42 63 251 Issued debt — — 26,908 — , At December 2020 Lease liabilities 3,470 3,909 — — Capital risk management The Group’s objectives when managing capital is to safeguard the Group’s ability to continue as a going concern, in order to provide returns for shareholders and benefits for other stakeholders, and to maintain an optimal capital structure. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares. The Group has a very prudent view of using debt to finance future outflows and carefully monitors its EBITDA vs. debt, net assets vs. debt and market capitalisation vs. debt ratios. Please see the net debt tables below the cashflows and note 29 showing the fair value hierarchy of liabilities. |
ADOPTION OF NEW AND REVISED STA
ADOPTION OF NEW AND REVISED STANDARDS AND INTERPRETATIONS | 12 Months Ended |
Dec. 31, 2021 | |
ADOPTION OF NEW AND REVISED STANDARDS AND INTERPRETATIONS | |
ADOPTION OF NEW AND REVISED STANDARDS AND INTERPRETATIONS | 5. The Group has adopted all recognition, measurement and disclosure requirements of IFRS, including any new and revised standards and Interpretations of IFRS, in effect for annual periods commencing on or after 1 January 2021. The adoption of these standards and amendments did not have any material impact on the financial result of position of the Group. Standards which are in issue but not yet effective: At the date of authorisation of these financial statements, the following Standards and Interpretation, which have not yet been applied in these financial statements, were in issue but not yet effective. Standard or Interpretation Description Effective date for annual accounting period beginning on or after IAS 1 Amendments – Presentation and Classification of Liabilities as Current or Non-current 1 January 2023 IAS 16 Amendments - Property, Plant and Equipment 1 January 2022 IAS 37 Provisions, Contingent Liabilities and Contingent Assets 1 January 2022 IAS 8 Amendments - Definition of Accounting Estimates 1 January 2023 IAS 1 Amendments – Disclosure of Accounting Policies 1 January 2023 IFRS 3 Amendments – Business Combinations – Conceptual Framework 1 January 2022 IFRS Annual Improvements to IFRS Standards 2018-2020 1 January 2022 The Group has not early adopted any of the above standards and intends to adopt them when they become effective. |
KEY JUDGEMENTS AND ESTIMATES
KEY JUDGEMENTS AND ESTIMATES | 12 Months Ended |
Dec. 31, 2021 | |
KEY JUDGEMENTS AND ESTIMATES | |
KEY JUDGEMENTS AND ESTIMATES | 6. In the application of the Group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods. The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below. Fair value of assets and liabilities acquired from GPUone - Note 17 The fair value of assets acquired was assessed in line with independent valuations provide by CBRE of the properties. Given the continued demand for power sites and data centres in the North of America, the Directors consider the valuations to be prudent, however they are still in line with the fair value and consideration paid for the entities, primarily (as discussed above) for Argo to gain access to the low cost of power and direct control of management of the miners at those sites. The land and buildings have been capitalised (and subsequently depreciated) at the value the independent valuers have given those properties. When modelling a cashflow on these properties and the benefit of owning versus being hosted at the properties the cashflow and profits support these valuations. Valuation of cryptocurrencies- Note 22 During the year the directors assessed the treatment of both the Bitcoin it mines and the other cryptocurrency held for investment purposes (as part of the broader diversification into non-mining activities), deciding that the only digital assets it would carry and treat as inventories would be the cryptocurrency mined or held in the mined currency (Bitcoin). As such any other cryptocurrency is treated as an intangible assets ( see note 18). The Board regularly monitors the values of the cryptocurrencies and any market forecasts. During the period, the Group entered into crypto currency transactions, which were assessed for fair value in line with the requirements of IAS 2, Inventories. If assets held by commodity broker-traders are principally acquired for the purpose of selling in the near future and generating a profit from fluctuations in price or broker-traders’ margin, such assets are accounted for as inventory, and changes in fair value (less costs to sell) are recognized in profit or loss. Revaluations were made with such regularity that as at the end of the reporting period the carrying amount of the asset does not differ materially from its fair value. All revaluations were made with reference to level 1 information, being crypto currencies actively traded on the open market (www.coingecko.com). Although this is the source to which we predominantly refer due to the large population of cryptocurrencies it monitors, we regularly review this against other price websites and exchanges. As at 31 December 2021 the Group held £80,759,000 of crypto currency (see note 22). Cryptocurrencies mined by the Group are classified as digital assets (See Note 22). Cryptocurrencies not mined by the Group are classified as intangible assets (see Note 18). Tokens are valued at cost until they start vesting and reviewed for impairment. Crowd loans are valued at £nil given that no tokens have yet been received and/or have started vesting. It should be noted only immaterial amounts are invested in this form of assets. Share-based payments- Note 23 During the year (and in previous years) share based payments were made based on the fees due to certain individuals for services to be performed by them in the future. In calculating these payments, where possible the Directors consulted with professional advisers to establish the market rate for these services. In addition to this, the company has also issued warrants and options to Directors and employees which have been valued in accordance with the Black Scholes model. Significant estimation and judgement is required by the directors when using the Black Scholes method. Further details of these estimates are available in note 23. Contingent consideration – Note 26 An element of consideration relating to the asset acquisition of the Texas facility (Helios) is contingent on the fulfilment of future contractual milestones. On acquisition, estimates are made regarding the probability of fulfilment and expected timing. These estimates are reassessed at each reporting date and adjustments made to the liability where necessary. The carrying value of contingent consideration at 31 December 2021 was £8,071,000 (2020: £nil). Valuation of tangible and intangible fixed assets- Notes 18 and 19 The directors considered at length whether any further impairments were required on the value of the mining and computer equipment, and website and underlying software. In doing so they made use of forecasts of revenues and expenditure prepared by the Group and came to the conclusion that further impairment of those assets were unnecessary based on current forecasts. Fair value of assets acquired was assessed in line with independent valuations provide by CBRE of the sites. Given the continued demand for power sites and data centres in the North of America the Directors consider the valuations to be prudent, however they are still in line with the fair value and consideration paid for the entities, primarily (as discussed above) for Argo to gain access to the low cost of power and direct control of management of the miners at those sites. During the year as the Group expanded into non-mining activities (Argo Labs) the assets held within Argo Labs are classified as intangible assets. Any impairment of these assets is reflected in the income statement and any increased in the fair value are reflected in the fair value reserve. Argo Labs is an in-house innovation arm focused on identifying opportunities within the disruptive and innovative sectors of the broader cryptocurrency ecosystem. Argo Labs uses a portion of Argo’s crypto assets to deploy into various blockchain projects. Currently Argo allocates approximately 10% if its digital asset holdings to Argo Labs. Valuation of investments in subsidiaries and amounts due from group companies- Note 21 The Board considered amounts due from group companies and whether any further impairments were required on their carrying value. When considering these amounts they made use of forecasts of the profitability of the subsidiary and of their revenues and expenditure and concluded that impairment of those assets were unnecessary based on current forecasts and performance during the first part of 2022. The forecasts to support this were built using our existing internal models showing positive cash contribution and profitability of the subsidiaries and their future value to the Group as a whole. Both pre and post year end these models continue to show that the contribution to the Group is at least the carrying value of these investments and as such no impairment has been recognized. Valuation of investments- Note 15 The Board has reviewed the carrying value of investments at the year end. They have taken into account the underlying investments and have concluded those investments do not require impairment. WonderFi is listed on the Canadian NEO Exchange market and as such has been valued at its market price. |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2021 | |
REVENUES | |
REVENUES | 7 . 2021 2020 £'000 £'000 Crypto currency mining - worldwide 70,325 18,947 Subscriber revenue - worldwide — 10 Crypto currency management fees – United States 3,879 — Total revenue 74,204 18,957 Due to the nature of Cryptocurrency mining, it is not possible to provide a geographical split of the revenue stream. Cryptocurrency mining revenues are recognized at a point in time , being when it is credited to the Group's wallet. Cryptocurrency management fees are services recognized over time. |
EXPENSES BY NATURE
EXPENSES BY NATURE | 12 Months Ended |
Dec. 31, 2021 | |
EXPENSES BY NATURE | |
EXPENSES BY NATURE | 8. 2021 2020 Direct Costs £’000 £’000 Depreciation of mining hardware 11,129 5,896 Hosting and other costs 11,057 11,210 Total direct costs 22,186 17,106 2021 2020 Administrative expenses £’000 £’000 Salary and other employee related costs 2,662 461 Depreciation and amortization 382 131 Insurance 1,408 117 Public relations and associated activities 699 113 Travel and subsistence 128 46 Audit fees 239 135 Carbon credits 252 — Hedging costs 326 — Impairment of intangible assets 535 — Repairs and maintenance 939 75 Settlement re Crypto mining management fees (1,561) — Write off of variable contingent consideration (352) — Research costs — 20 Other expenses 424 265 Total administrative expenses 6,081 1,363 2021 2020 Finance Costs £’000 £’000 Interest on loans and borrowings 2,142 151 Total finance costs 2,142 151 |
AUDITORS' REMUNERATION
AUDITORS' REMUNERATION | 12 Months Ended |
Dec. 31, 2021 | |
AUDITORS' REMUNERATION | |
AUDITORS' REMUNERATION | 9. 2021 2020 £’000 £’000 In relation to statutory audit services 170 100 Other audit assurance services 52 35 Total auditor’s remuneration 222 135 |
EMPLOYEES
EMPLOYEES | 12 Months Ended |
Dec. 31, 2021 | |
EMPLOYEES | |
EMPLOYEES | 10. EMPLOYEES The average monthly number of persons (including directors) employed by the group during the period was: 2021 2020 Number Number Directors and employees 26 6 Their aggregate remuneration comprised: 2021 2020 £’000 £’000 Wages and salaries 2,286 191 Social security costs 199 13 Pension costs 25 — Share based payments 1,392 24 3,902 228 The average monthly number of persons (including directors) employed by the company during the period was: 2021 2020 Number Number Directors and employees 4 1 Their aggregate remuneration comprised: 2021 2020 £’000 £’000 Wages and salaries 406 135 Social security costs 8 18 Pension costs 1 — Share based payments 330 — 745 153 |
DIRECTOR'S REMUNERATION
DIRECTOR'S REMUNERATION | 12 Months Ended |
Dec. 31, 2021 | |
DIRECTOR'S REMUNERATION | |
DIRECTOR'S REMUNERATION | 11. 2021 2020 £’000 £’000 Director’s remuneration for qualifying services 856 532 Senior management loss of office 132 — Share based payments expense 431 20 Total remuneration for directors and key management 1,416 552 The amounts above are remunerated through both salaries (of which, some are included in 10) and through service companies (as disclosed in note 31). The highest paid director during the year was Peter Wall, earning £455,000, (2020 - £251,000) |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2021 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 12. The basic earnings per share is calculated by dividing the profit attributable to equity shareholders by the weighted average number of shares in issue. The Group and Company has in issue 17,688,897 warrants and options at 31 December 2021 (2020 -41,202,382). 2021 2020 Net profit for the period attributable to ordinary equity holders from continuing operations (£'000) 30,765 1,442 Weighted average number of ordinary shares in issue ('000) 397,513 303,436 Basic earnings per share for continuing operations (pence) 7.7 0.5 Net profit for the period attributable to ordinary equity holders for continuing operations (£'000) 30,765 1,442 Diluted number of ordinary shares in issue ('000) 415,201 344,638 Diluted earnings per share for continuing operations (pence) 7.4 0.4 |
TAXATION
TAXATION | 12 Months Ended |
Dec. 31, 2021 | |
TAXATION | |
TAXATION | 13. TAXATION 2021 2020 Current tax: £’000 £’000 Current tax on profits for the year 7,679 — Adjustments in respect of prior periods — — Total current tax 7,679 — 2021 2020 Deferred tax: £’000 £’000 Origination and reversal of temporary differences 827 — Total deferred tax 827 — Total tax charge 8,506 — No deferred tax has been recognized on the losses brought forward on the UK and US losses given the uncertainty on the generation of future profits. Income tax expense The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to profits of the consolidated entities as follows: 2021 2020 £'000 £'000 Profit before taxation 39,271 1,442 Expected tax charge based on a weighted average of 25% (2020 - 24% ) (UK, US and Canada) 9,746 346 Effect of expenses not deductible in determining taxable profit 1,779 3 Capital allowances in excess of depreciation (3,770) (101) Other tax adjustments (137) (141) Unrealized gains/(loss) on crypto assets (385) (562) Origination and reversal of temporary differences 827 — Unutilized tax losses carried forward 445 455 Taxation charge in the financial statements 8,506 — The group has tax losses available to be carried forward and used against trading profits arising in future periods of approximately £10,476,000 (2020 - £10,031,000). No deferred tax asset has been recognized on the UK and US unutilised losses. The weighted average applicable tax rate was 25% (2020: 24%). The increase is caused by a change in the profitability of the Group’s subsidiaries in the respective countries. The deferred tax liabilities as at 31 December 2021, without taking into consideration the offsetting of balances within the same tax jurisdiction, is as follows: 2021 2020 Deferred tax liabilities £ '000 £ '000 Fair value gains: Digital assets 286 — Gain on fair value of property acquired (see note 17) 442 — Share of other comprehensive income of associates 99 — Total deferred tax 827 — Split between: 2021 2020 Deferred tax liabilities £’000 £’000 Current liabilities 286 — Non-current liabilities 541 — Total deferred tax 827 — |
INVESTMENT IN SUBSIDIARIES
INVESTMENT IN SUBSIDIARIES | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENT IN SUBSIDIARIES | |
INVESTMENT IN SUBSIDIARIES | 14. Company Details of the Company’s subsidiaries at 31 December 2021 and 31 December 2020 are as follows: Country of Ownership Voting Power Nature of Name of Undertaking Incorporation Interest (%) Held (%) Business Argo Innovation Labs Inc. Canada 100 % 100 % * Argo Innovation Labs Limited UK 100 % 100 % Dormant Argo Innovation Facilities (US) Inc. USA 100 % 100 % * 9377-2556 Quebec Inc. Canada 100 % 100 % ** 9366-5230 Quebec Inc. Canada 100 % 100 % ** * ** The provision of cryptocurrency mining sites 2021 2020 Investment in subsidiaries £’000 £’000 At 1 January — — Additions 12,181 — At 31 December 12,181 — The cost of the investment above is in respect of the DPN LLC acquisition. Further detail can be found in note 19. The Company’s interest in Argo innovation Labs Inc. was acquired on incorporation of the company, previously named Argo Blockchain Canada Holdings Inc., on 12 January 2019. The registered office of Argo Blockchain Canada Holdings Inc. is 700-401 West Georgia Street, Vancouver, BC V6B 5A1 Canada. On 8 January 202 Argo Blockchain Canada Holdings Inc.’s name was changed to Argo Innovation Labs Inc.. On 1 September 2019 the Company acquired 100% of Argo Mining Limited for £1 (one). The registered office is 9th Floor 16 Great Queen Street, London, England, WC2B 5DG. On 14 January 2020 Argo Mining Limited changed its name to Argo Innovation Labs Limited. This company was dormant in the years ended 31 December 2020 and 2021. Argo innovation Facilities (US) Inc was incorporated on 25 February 2021 with a registered address of 2028 East Ben White Blvd. Austin, TX 78740 . 9377-2556 Quebec Inc.and 9366-5230 Quebec Inc.are the GPUone subsidiaries acquired on 11 May 2021 with registered addresses of 8 avenue William Dobell, Baie-Comeau, Quebec G4Z 1T7 and 10205 Irene Vachon, Mirabel, Quebec J7N 3E3 respectively . More information on this acquisition can be found in note 17. |
INVESTMENTS AT FAIR VALUE THROU
INVESTMENTS AT FAIR VALUE THROUGH INCOME OR LOSS | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENTS AT FAIR VALUE THROUGH INCOME OR LOSS | |
INVESTMENTS AT FAIR VALUE THROUGH INCOME OR LOSS | 15 . Non-current 2021 2020 £'000 £'000 At 1 January 1,393 58 Additions 219 1,336 Foreign exchange movement — (1) Fair value through income or loss 183 — Disposals (1,392) — At 31 December 403 1,393 GPUone Holding Inc. As part of the disposition of GPUone Holdings Inc on 20 August 2021 Argo disposed of 100% of its holding for a total consideration of £764,000, of which £128,000 was received post year end once the final total assets were calculated. This resulted in a loss on sale of investment of £629,000. Luxor Technology Corporation On 7 December 2020 the Group entered into an agreement to acquire £73,427 (USD$100,000) of shares in Luxor Technology Corporation. On 7 May 2021, following a second round of funding which the Group did not participate in, this prepayment became an investment representing less than 1% of the Series A-1 Preferred Stock and voting rights. WonderFi Technologies Inc. On 3 June 2021 the Group invested £145,933 (CDN$250,000) of WonderFi Technologies Inc. equating to 250,000 ordinary shares (formerly DeFi Ventures Inc.) an investment representing less than 1% of the Ordinary shares and voting rights. As at 31 December 2021 the investment was revalued to the year end share price of CAD 2.25 per share, resulting in a £183,000 fair value adjustment. |
INVESTMENTS ACCOUNTED FOR USING
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD | |
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD | 16. 2021 2020 £000 £000 At January 1 — — Acquired during the period 8,444 — Share of loss (1,198) Share of fair value gains on intangible assets through other comprehensive income 6,571 At December 31 13,817 — Set out below are the associates of the Group as at 31 December 2021, which, in the opinion of the Directors, significant influence is held. The associate as listed below has common stock consisting solely of ordinary shares, which are held directly by the Group. The country of incorporation or registration is also their principal place of business. Nature of investment in associates: % of Address of the ownership Nature of Measurement Name of entity registered office interest relationship method Pluto Digital PLC Hill Dickinson LLP, 8th Floor The Broadgate Tower, 20 Primrose Street, London, United Kingdom, EC2A 2EW 24.65 % Refer below Equity On 3 February 2021 Argo invested in Pluto Digital PLC (“Pluto”), a crypto venture capital and technology company. The investment was satisfied with 75,000 Polkadot with a fair value at that date of £1,091,850. Further to this in a second round of funding the Group invested an additional £7,352,970 on 8 March 2021. In addition the Argo holds 121,666,666 warrants as a price of £0.12 each and 35,450,000 warrants at a price of £0.06 each. If Pluto was fully diluted Argo’s ownership would be 33.26% as at 31 December 2021 including the exercise of the share warrants. Argo owns 24.65% of the total common stock and voting rights of the business and is entitled to nominate one director to the Pluto Board of Directors. Pluto is a crypto technology company that connects Web 3.0 decentralised technologies to the global economy. Pluto identifies key emerging areas and projects in the crypto sphere, then deploys its business, networks and technical expertise to create value for crypto partners, projects and Pluto shareholders. Pluto incubates and advises digital asset projects based on decentralised technologies, decentralised finance and networks such as Ethereum and Polkadot. Additionally, Pluto supports the operation of proof-of-stake networks by staking and operating validator nodes. Pluto represents a strategic partnership for the Group as it diversifies its activities in the crypto space. Pluto Digital PLC is a private company and there is no quoted market price available for its shares. There are no contingent liabilities relating to the Group’s interest in the associates. The audited financial information for the period ended 30 September 2021 and the unaudited management accounts for the period from 1 October 2021 to 31 December 2021 have been made available by Pluto to the Group and the figures in the above represent Argo’s share of the loss and gain on the fair value of the intangible assets (net of deferred tax). Summarized financial information for associates Set out below is the summarized financial information for Pluto Digital plc which is accounted for using the equity method, based upon audited financial statements to 30 September 2021 and management accounts for the 3 months ended 31 December 2021. Summarized Statement of Financial Position Pluto Digital plc As at 31 December 2021 £000 Current Cash and cash equivalents 1,759 Other current assets (excluding cash) 335 Total current assets 2,094 Trade payables 88 Other current liabilities (excluding trade payables) 1,494 Total current liabilities 1,582 Non-current Tangible fixed assets 49 Investments and other non-current assets 56,000 Total non-current assets 56,049 Financial liabilities 2,807 Total non-current liabilities 2,807 Net assets 53,754 Pluto was incorporated in 2021, therefore, no comparatives are available. Summarized Statement of Comprehensive Income, Pluto Digital plc January 12 – December 31, 2021 £000 Operating costs and expense (7,652) Realized gains – digital assets 2,394 Loss from continuing operations (5,258) Income tax expense 575 Post-tax loss from continuing operations (4,867) Other comprehensive income 26,991 Total comprehensive Income 21,824 The information above reflects the amounts presented in the financial statements of the associate (and not Argo Blockchain Plc’s share of those amounts) adjusted for differences in accounting policies between the Group and the associate. Reconciliation of summarized financial information 2021 £000 Summarized financial information Net assets at acquisition 34,228 Profit/(loss) for the period (4,867) Other comprehensive income 26,691 Foreign exchange differences — Closing net assets 56,052 Interest in associates (24.65%; 0%) 13,817 Goodwill — Carrying value 13,817 |
BUSINESS COMBINATION
BUSINESS COMBINATION | 12 Months Ended |
Dec. 31, 2021 | |
BUSINESS COMBINATION | |
BUSINESS COMBINATION | 17. GPUone subsidiaries acquired from GPUone Holding Inc. On 11 May 2021, the Group acquired 100% of the common stock of GPUone 9377-2556 and GPUone 9366-5230 from its shareholder GPUone Holding Inc. for a total consideration of £5,537,000; consisting of £213,000 being satisfied in cash and the balance satisfied by the cancellation of certain prepayments and deposits previously paid by Argo to the vendor. Each of these acquired entities owned and operated a data centre within which Argo was the lead tenant. The acquisition was performed to enable the Group to obtain control of its hosting facility and power costs across its facilities in Canada. From acquisition on 11 May 2021 to 31 December 2021 the GPUone subsidiaries loss amounted to £3,369,000 which is fully consolidated . The consideration was negotiated on an arm’s length basis and primarily on the basis of the valuation of the land and buildings being acquired. The directors attribute the consideration as fair value of the land and buildings with no goodwill being recognized as currently Argo does not anticipate hosting any third parties at these sites in the medium term. The fair values of the acquisition date assets and liabilities, together with any separately identifiable intangible assets, have been provisionally determined at 30 September 2021 because the acquisition was completed late in the period. The Group is currently obtaining the information necessary to finalise its valuation. On a £1 for £1 basis certain deposits and other receivables totalling £668,000 were acquired. The directors consider these amounts fully recoverable and as such these receivables have not been impaired. Liabilities assumed are incorporated at their cost. The following table summarises the consideration paid for the GPUone subsidiaries and the fair value of assets acquired and liabilities assumed at the acquisition date: Consideration £'000 Cash 213 Payment for deposits 668 Cancellation of prepayment and deposits 4,656 Total consideration 5,537 Recognized amounts of identifiable assets acquired, and liabilities assumed £'000 Cash and cash equivalents 4 Property, plant and equipment (Note 11) 10,779 Trade and other receivables 387 Trade and other payables (326) Property mortgages (5,010) Lease liability (377) Goodwill 80 Total 5,537 Fair value of assets acquired was assessed in line with independent valuations provided by CBRE of the sites. Given the continued demand for power sites and data centres in North America the Directors consider the valuations to be prudent, however they are still in line with the fair value and consideration paid for the entities, primarily (as discussed above) for Argo to gain access to the low cost of power and direct control of management of the miners at those sites. No acquisition costs have been recognized in the above calculations. |
INTANGIBLE FIXED ASSETS
INTANGIBLE FIXED ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
INTANGIBLE FIXED ASSETS | |
INTANGIBLE FIXED ASSETS | 18. Digital Goodwill assets Website Total £’000 £’000 £’000 £’000 Cost At 1 January 2020 — — 671 671 Addition / Disposals — — — — At 31 December 2020 — — 671 671 Additions 80 18,216 — 18,296 Disposals — (12,792) — (12,792) At 31 December 2021 80 5,424 671 6,175 Amortization and impairment At 1 January 2020 — — 189 189 Amortization charged in the period — — 114 114 At 31 December 2020 — — 303 303 Foreign exchange movement — — 9 9 Impairment — 535 — 535 Fair value gain — (414) — (414) Amortization charged during the period — — 138 138 At 31 December 2021 — 121 450 571 Balance At 31 December 2021 80 5,303 221 5,604 Digital assets are cryptocurrencies not mined by the Group. The Group held crypto assets during the year, which are recorded at cost on the day of acquisition. Movements in fair value between acquisition (date mined) and disposal (date sold), and the movement in fair value in crypto assets held at the year end, impairment of the intangible assets and any increase in fair value are recorded in the fair value reserve. The digital assets held below are held in Argo Labs (a division of the Group) as discussed above. The assets are all held in secure custodian wallets controlled by the Group team and not by individuals within the Argo Labs team. The assets detailed below are all accessible and liquid in nature. Those assets (immaterial in total) held longer term are inaccessible have been valued either at cost or £nil depending upon the information available as at the year end. As at 31 December 2021 Fair value Crypto asset name Coins/tokens £000 Polkadot – DOT 71,303 1,527 Ethereum - ETH 558 1,415 Cosmos Hub – ATOM 31,789 601 Solana - SOL 6,249 579 USDC (stable coin – fixed to USD) 274,110 203 Alternative coins — 978 At 31 December 2021 — 5,303 |
TANGIBLE FIXED ASSETS
TANGIBLE FIXED ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
TANGIBLE FIXED ASSETS | |
TANGIBLE FIXED ASSETS | 19. Mining and Assets Right of Office Computer Under Improvements use Assets Equipment Equipment Construction to data centers Data centers Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 Cost At 1 January 2021 7,379 17,865 — 85 — 25,329 Foreign exchange movement — — (62) — — — (62) Acquisition through business combination 358 — — 12,180 — 10,466 23,004 Additions — 49 33,317 49,126 — — 82,492 Transfer to another class (7,379) — 7,379 — — — At 31 December 2021 358 49 58,499 61,306 85 10,466 130,763 Depreciation and impairment At 1 January 2021 — — 7,443 — 48 — 7,491 Foreign exchange movement — — (65) — — — (65) Depreciation charged during the period 3,281 — 7,856 — 17 229 11,383 Transfer to another class (3,273) — 3,273 — — — — At 30 December 2021 8 — 18,507 — 65 229 18,810 Carrying amount At 1 January 2021 7,379 10,487 — 37 — 17,904 At 31 December 2021 350 49 39,992 61,306 20 10,237 111,954 No depreciation has been charged on the Texas land and buildings additions, which are included within assets under construction, as they are yet to come into use. On 8 March 2021 the Group completed the acquisition of DPN LLC to acquire 160 acres (with option to purchase a further 157 acres) of land in West Texas. The Group used ordinary shares as payment to acquire DPN LLC, part of which was issued during the period amounting to One of the data centres acquired through the GPUone acquisition owns a building on long term leasehold land (expiring in July 2072). Details of the outstanding lease liability can be found in note 28. As per note 17 the directors have obtained independent valuations of both the Texas land and data centres all of which supports the carrying value of those assets. CBRE Limited performed the valuations for the Mirabel building and Baie-Comeau property using the income method. Right of use Assets Mining and Computer Equipment Data centers including improvements Total £’000 £’000 £’000 £’000 Cost At 1 January 2020 — 17,833 85 17,918 Foreign exchange movement — (136) — (136) Additions 7,379 1,808 — 9,187 Disposals — (1,640) — (1,640) At 31 December 2020 7,379 17,865 85 25,329 Depreciation and impairment At 1 January 2020 — 2,488 31 2,519 Foreign exchange movement — 15 — 15 Depreciation charged during the period — 5,896 17 5,913 Depreciation on Disposals — (1,021) — (1,021) At 31 December 2020 — 7,377 48 7,425 Carrying amount At 1 January 2020 — 15,345 54 15,399 At 31 December 2020 7,379 10,487 37 17,904 All property, plant and equipment as at 31 December 2020 was owned by the subsidiary, Argo Innovation Labs Inc. During the year, the lease for the right of use assets was settle by purchasing the mining equipment. Book balances were transferred to mining and computer equipment. Acquisition of DPN LLC On 8 March 2021 the Group completed the acquisition of DPN LLC to acquire 160 acres (with option to purchase a further 157 acres) of land in West Texas for the construction of a 200MW mining facility for completion mid-2022. The acquisition of DPN LLC, effectively comprising the land acquisition in West Texas, has been treated as an asset acquisition in the financial statements. The consideration for the acquisition was an initial price of GBP 3.6m, satisfied by the issue and allotment to the shareholders of DPN LLC of 3,497,817 new ordinary shares in Argo, with up to a further 8.6m of shares payable if certain contractual milestones related to the facility are fulfilled. Initial issue and allotment of GBP 3.6m has been recognized based on estimated fair value of assets received at acquisition in line with IFRS 2 Share based payments. Contingent consideration balance of this business combination has been subsequently measured at fair value with changes recognized in profit and loss in line with IFRS 9. Fair value of assets acquired was assessed in line with independent valuations of site by CBRE as well as external financial due diligence and financial modelling. Financial models used historical power purchase assumptions for the area and the Company’s internal hash rate and Bitcoin pricing assumptions to help the Company evaluate the financial benefits of developing a Bitcoin mining operation on the land. Work performed by DPN LLC did from August 2019, when it purchased the land, to March 2021, when it sold the land to the Company, to prepare for a Bitcoin mining operation added to the value of the land for that purpose. Consideration at 8 March 2021 £’000 Share based payment 3,521 Contingent consideration to be settled in shares 8,659 Total 12,180 Allocated as follows £’000 Tangible fixed assets (Asset under construction) 12,180 Total 12,180 |
OTHER RECEIVABLES (NON-CURRENT)
OTHER RECEIVABLES (NON-CURRENT) | 12 Months Ended |
Dec. 31, 2021 | |
OTHER RECEIVABLES (NON-CURRENT) | |
OTHER RECEIVABLES (NON-CURRENT) | 20. 2021 2020 £'000 £'000 Deposits Brought forward 4,115 4,151 Exchange movement — (36) Cancelled on acquisition of GPUone subsidiaries (4,115) — Total carrying amount of other receivables — 4,115 On this deposit was used as part of the acquisition of the GPUone Holding Inc subsidiaries detailed in note 17. |
TRADE AND OTHER RECEIVABLES INT
TRADE AND OTHER RECEIVABLES INTERCOMPANY | 12 Months Ended |
Dec. 31, 2021 | |
TRADE AND OTHER RECEIVABLES/ INTERCOMPANY | |
TRADE AND OTHER RECEIVABLES/ INTERCOMPANY | 2 1. 2021 2020 £'000 £'000 Prepayments and other receivables 13,194 812 Mining equipment prepayments 47,426 — Other taxation and social security 2,739 1,364 Total trade and other receivables 63,359 2,176 Mining equipment prepayments consist of payments made and due on mining equipment due to arrive by the end of 2021. Payments to ePIC ASIC Asia Limited (“ePIC”) comprise £3,430,000, True North £2,366,000 and the balance of £41,630,000 was paid to Bitmain in advance of machine purchases to be received after the period end. In February 2021, the Group entered into an agreement with ePIC (a designer and manufacturer of mining machines), which gave the Group priority access to next generation mining machines on a non-exclusive basis. As part of the agreement, the Group will assist in the development and testing of future products and will provide space and capacity at our Mirabel facility for ePIC’s research and innovation engineering teams to assist in the development of future mining machines. In August 2021, based on limitations of technology, Argo and ePIC agreed to amend their agreement. Under the amended agreement, the initial purchase order was cancelled and, at Argo’s option, the $5 million deposited with ePIC, in whole or in part, can be applied to the purchase of ePIC mining machines or ePIC common stock or repaid in full. Other taxation and social security consist of purchase tax recoverable in the UK and Canada. GST and QST debtors are greater than 90 days as at 31 December 2021. The directors consider that the carrying amount of trade and other receivables is equal to their fair value. |
DIGITAL ASSETS
DIGITAL ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
DIGITAL ASSETS | |
DIGITAL ASSETS | 22 . The Group mined crypto assets during the period, which are recorded at fair value on the day of acquisition. Movements in fair value between acquisition (date mined) and disposal (date sold), and the movement in fair value in crypto assets held at the year end, are recorded in profit or loss. The Group had used 1,504 Bitcoin as collateral for a loan see note 27, at that point the loan collateral was in excess of the requirements under the loan agreement. During the year, as a result of the launch of its non-mining activities all of the Group’s holding in crypto currencies other than Bitcoin are now classified as intangible assets. At the period end, the Group held Bitcoin representing a fair value of £80,759,000. The movement and breakdown is shown below: 2021 2020 £'000 £'000 At 1 January 4,637 1,041 Additions Crypto assets purchased and received 16,569 9,897 Crypto assets mined 70,325 18,948 Total additions 86,894 28,845 Disposals Crypto assets sold (12,400) (27,318) Total disposals (12,400) (27,318) Fair value movements Gain/(loss) on crypto asset sales 437 (14) Loss on futures — (259) Movements on crypto assets held at the year end 1,191 2,342 Total fair value movements 1,628 2,069 At 31 December 80,759 4,637 Carrying value of digital assets pledged as collateral 49,759 — The Group mined crypto assets during the period are recorded at fair value on the day of acquisition. Movements in fair value between acquisition (date mined) and disposal (date sold), and the movement in fair value in crypto assets held at the year end, are recorded in income or loss. The Group has used 1,504 Bitcoin as collateral for a loan - see note 27. As at 31 December 2021 the above digital assets solely comprised of 2,441 Bitcoin with a fair value of £80,759,000. As at 31 December 2020 Fair value Crypto asset name Coins/tokens £000 Bitcoin - BTC 183 3,930 Polkadot – DOT 75,000 515 Ethereum - ETH 254 138 Binance Coin - BNB 1,243 34 USDT,USDC & Tether (stable coin – fixed to USD) 26,509 19 Alternative coins — 1 At 31 December 2020 4,637 |
SHARE OPTIONS AND WARRANTS
SHARE OPTIONS AND WARRANTS | 12 Months Ended |
Dec. 31, 2021 | |
SHARE OPTIONS AND WARRANTS | |
SHARE OPTIONS AND WARRANTS | 23. The following options and warrants over Ordinary Shares have been granted by the company and are outstanding: Number of Number of options/warrants options/warrants Exercise outstanding exercisable Options/ Warrants Grant Date Expiry date Price 2021 ‘000 2021 ‘000 Warrants 15 January 2021 15 January 2031 £1.25 240 240 Warrants 19 April 2021 19 March 2024 £1.35 224 149 Warrants 19 January 2021 18 January 2026 £0.87 110 110 Warrants 17 June 2021 1 March 2024 £1.50 22 22 Options 25 July 2018 25 July 2024 £0.16 1,000 1,000 Options 17 July 2019 16 July 2024 £0.16 537 357 Options 5 February 2020 4 February 2030 £0.07 2,254 1,937 Options 5 February 2020 4 February 2030 £0.07 3,700 3,463 Options 3 February 2021 2 February 2031 £0.94 232 106 Options 27 June 2021 26 June 2031 £1.35 500 83 Options 24 June 2021 23 June 2031 £1.26 1,000 167 Options 1 July 2021 30 June 2031 £1.16 500 83 Options 13 July 2021 12 July 2031 £1.00 1,000 167 Options 22 September 2021 22 September 2031 £1.57 5,000 479 Options 17 December 2021 16 December 2031 £0.86 870 12 Options 23 November 2021 23 November 2031 £1.30 500 14 17,689 8,389 Number of Weighted options and average exercise warrants ‘000 price £ At 1 January 2021 41,776 0.12 Granted 10,698 1.63 Exercised (34,351) 0.12 Lapsed (434) 0.95 Outstanding at 31 December 2021 17,689 0.81 Exercisable at 31 December 2021 7,596 0.26 Number of Weighted options and average exercise warrants ‘000 price £ At 1 January 2020 45,037 0.14 Granted 11,400 0.07 Exercised (9,686) 0.16 Lapsed (4,975) 0.16 Outstanding at 31 December 2020 41,776 0.13 Exercisable at 31 December 2020 34,439 0.13 The weighted average remaining contractual life of options and warrants as at 31 December 2021 is 102 months (2020 -29 months ). If the exercisable shares had been exercised on 31 December 2021 this would have represented At the grant date, the fair value of the options and warrants prior to the listing date was the net asset value and post listing determined using the Black-Scholes option pricing model. Volatility was calculated based on data from comparable listed technology start-up companies, with an appropriate discount applied due to being an unlisted entity at grant date. Risk free interest has been based on UK Government Gilt rates for an equivalent term. Grant date Grant date share price Exercise price Volatility Life Risk Free interest rate % Marketability discount 25 July 2018 0.08 0.16 40 % 6 years 0.01 75 % 17 July 2019 0.09 0.16 40 % 6 years 0.01 90 % 5 February 2020 0.07 0.07 40 % 6 years 0.01 0 % 15 January 2021 1.07 1.25 112 % 10 years 0.01 0 % 19 January 2021 0.94 0.87 112 % 5 years 0.01 0 % 3 February 2021 0.94 0.94 112 % 10 years 0.01 0 % 19 April 2021 1.35 1.35 112 % 3 years 0.01 0 % 17 June 2021 1.35 1.50 112 % 3 years 0.01 0 % 24 June 2021 1.26 1.26 112 % 10 years 0.01 0 % 27 June 2021 1.35 1.35 112 % 10 years 0.01 0 % 1 July 2021 1.23 1.16 112 % 10 years 0.01 0 % 13 July 2021 1.00 1.00 112 % 10 years 0.01 0 % 22 September 2021 1.57 1.57 112 % 10 years 0.01 0 % 23 November 2021 1.30 1.30 112 % 10 years 0.01 0 % |
COMMON STOCK
COMMON STOCK | 12 Months Ended |
Dec. 31, 2021 | |
COMMON STOCK | |
COMMON STOCK | 24. As at 31 As at 31 December 2021 December 2020 £'000 £'000 Ordinary share capital Issued and fully paid 303,435,997 Ordinary Shares of £0.001 each 303 294 Issued in the period 164,646,338 Ordinary Shares of £0.001 each 165 — Fully paid not yet issued Ordinary Shares of £0.001 each — 9 468,082,335 Ordinary Shares of £0.001 each 468 303 Additional paid-in capital At beginning of the period 1,540 25,252 Cancelled during the period — (25,252) Issued in the period 150,977 — Issue costs (12,936) — Fully paid not yet issued — 1,540 At the end of period 139,581 1,540 |
RESERVES
RESERVES | 12 Months Ended |
Dec. 31, 2021 | |
RESERVES | |
RESERVES | 25. The following describes the nature and purpose of each reserve: Reserve Description Ordinary Shares Represents the nominal value of equity shares Additional paid-in capital Amount subscribed for common stock in excess of nominal value Share based payment reserve Represents the fair value of options and warrants granted less amounts transferred on exercise, lapse or expiry Accumulated other comprehensive income Cumulative effects of translation of opening balances on non-monetary assets between subsidiaries functional currencies (Canadian dollars and US Dollars) and Group presentational currency (Sterling). Fair value reserve Cumulative net gains on the fair value of intangible assets Other comprehensive income of equity accounted associates The other comprehensive income of any associates is recognized in this reserve Accumulated surplus Cumulative net gains and losses and other transactions with equity holders not recognized elsewhere. |
TRADE AND OTHER PAYABLES
TRADE AND OTHER PAYABLES | 12 Months Ended |
Dec. 31, 2021 | |
TRADE AND OTHER PAYABLES | |
TRADE AND OTHER PAYABLES | 26. 2021 2020 £'000 £'000 Trade payables 10,259 548 Accruals and other payables 4,986 271 Short term loans — 116 Other taxation and social security — 1 Total trade and other creditors 15,245 936 Within trade payables is £7,194,000 (2020: £nil) for amounts due for mining equipment not yet received. The directors consider that the carrying value of trade and other payables is equal to their fair value. Contingent consideration As part of the acquisition of DPN LLC up to a further 8.6m of shares being payable if certain contractual milestones related to the facility are fulfilled (see note 19). The amount payable as contingent consideration is payable in shares and as such is revalued as at the balance sheet date and any gain or loss is recognized in profit or loss, which for the year ended 31 December 2021 amounted to £236,000. If any of the milestones are not achieved then that element of contingent consideration is recognized in profit or loss. The amount derecognized and recorded as a gain during the year ended 31 December 2021 amounted to £352,000. |
LOANS AND BORROWINGS
LOANS AND BORROWINGS | 12 Months Ended |
Dec. 31, 2021 | |
LOANS AND BORROWINGS | |
LOANS AND BORROWINGS | 27. 2021 2020 Non-current liabilities £'000 £'000 Issued debt - bond 26,908 — Assumed mortgage on acquisition 3,391 — Total 30,299 — Current liabilities Short term loan 22,239 — Assumed mortgage on acquisition 1,152 — Total 23,391 — The mortgages are secured against the two buildings at Mirabel and Baie Comeau are repayable over periods from 15 months to 60 months at interest rates of between 3% and 5% respectively. On 23 December 2021 the Group entered into a loan agreement with Galaxy Digital LP for a loan of USD$30 million (£ per annum. The loan is payable on demand. In November 2021, the Group issued an unsecured 5 year bond with an interest rate of 8.75% . The directors do not consider that there is any variance between the fair value of the borrowings and the carrying amount. The bonds will mature on 30 November 2026. The bonds may be redeemed for cash in whole or in part at any time at the Group’s option (i) on or after 30 November 2023 and prior to 30 November 2024, at a price equal to The Group may redeem the bonds, in whole, but not in part, at any time at its option, at a redemption price equal to 100.5% of the principal amount plus accrued and unpaid interest to, but not including, the date of redemption, upon the occurrence of certain change of control events. The bond is listed on the Nasdaq Global Select Market under the symbol ARBKL. |
LEASE LIABILITIES
LEASE LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
LEASE LIABILITIES | |
LEASE LIABILITIES | 28. LEASE LIABILITIES 2021 2020 £’000 £’000 Lease liability – current 7 3,470 Lease liability – non current 370 3,910 During the year as part of the acquisition of the GPUone subsidiaries (see note 17) the company acquired a lease on the land of one of the data centres. This is a long term lease expiring in 2072 at an interest rate of 5.5% with limited conditions, which in the opinion of the directors will be met. The material condition of this lease is that CAD 1.5m will be spent on the buildings to maintain upkeep during the lease period. In late 2020, the Company entered into a lease agreement with Celsius Network for mining hardware at an interest rate of 12% per annum. In December 2021, the Company settled the outstanding amount of the lease. During the year £114,000 of interest was paid in respect of the assumed mortgages and £8,000 was paid in respect of the land lease liability. |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL INSTRUMENTS | |
FINANCIAL INSTRUMENTS | 29. 2021 2020 £'000 £'000 Carrying amount of financial assets Measured at amortised cost - Mining equipment prepayments 47,426 — - Trade and other receivables 13,194 145 - Cash and cash equivalents 11,803 2,051 Measured at fair value through profit or loss 403 1,393 Total carrying amount of financial assets 72,826 3,589 Carrying amount of financial liabilities Measured at amortised cost - Trade and other payables 10,259 548 - Short term loans 23,391 116 - Long term loans 3,391 — - Issued debt - bonds 26,908 - Lease liabilities 377 7,409 Measured at fair value - Fair value of contingent consideration 8,071 Total carrying amount of financial liabilities 72,397 8,073 Fair Value Estimation Fair value measurements are disclosed according to the following fair value measurement hierarchy: ● Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1) ● Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices), or indirectly (that is, derived from prices) (Level 2) ● Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3). This is the case for unlisted equity securities. The following table presents the Group’s assets and liabilities that are measured at fair value at 31 December 2021 and 31 December 2020. Level 1 Level 2 Level 3 Total Assets £'000 £'000 £'000 £'000 Financial assets at fair value through profit or loss - Equity holdings 329 — 73 402 - Digital assets — 80,759 — 80,759 Total at 31 December 2021 329 80,759 73 81,161 Liabilities Financial liabilities at fair value through profit or loss - Deferred contingent consideration — — 8,071 8,071 Total at 31 December 2021 — — 8,071 8,071 Level 1 Level 2 Level 3 Total Assets £'000 £'000 £'000 £'000 Financial assets at fair value through profit or loss Equity holdings — — 1,393 1,393 Digital assets — 4,637 — 4,637 Total at 30 December 2020 — 4,637 1,393 6,030 All financial assets are in listed and unlisted securities and digital assets. There were no transfers between levels during the riod The Group recognises the fair value of financial assets at fair value through profit or loss relating to unlisted investments at the cost of investment unless: ● There has been a specific change in the circumstances which, in the Group’s opinion, has permanently impaired the value of the financial asset. The asset will be written down to the impaired value; ● There has been a significant change in the performance of the investee compared with budgets, plans or milestones; ● There has been a change in expectation that the investee’s technical product milestones will be achieved or a change in the economic environment in which the investee operates; ● There has been an equity transaction, subsequent to the Group’s investment, which crystallises a valuation for the financial asset which is different to the valuation at which the Group invested. The asset’s value will be adjusted to reflect this revised valuation; or ● An independently prepared valuation report exists for the investee within close proximity to the reporting date. ● The deferred consideration has been fair valued to the year end date as the amount is to be paid in Argo shares. |
COMMITMENTS
COMMITMENTS | 12 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS | |
COMMITMENTS | 30. The Group’s material contractual commitments relate to the master services agreement with Core Scientific, which provides hosting, power and support services. Whilst management do not envisage terminating agreements in the immediate future, it is impracticable to determine monthly commitments due to large fluctuations in power usage and variations on foreign exchange rates, and as such a commitment over the contract life has not been determined. Capital expenditure contracted for at the year end of the reporting period but not recognized as liabilities, relating to the Texas assets in the course of construction, amounted to £9,639,000. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 31. Key management compensation Key management includes Directors (executive and non-executive) and senior management. The compensation paid to related parties in respect of key management for employee services during the period was made from Argo Innovation Labs Inc., amounting to: £36,769 paid to POMA Enterprises Limited in respect of fees of Matthew Shaw (Non-executive director); £442,808 due to Vernon Blockchain Inc in respect of fees of Peter Wall (CEO), of which £123,711 was outstanding at the year end. Alex Appleton (CFO) through Appleton Business Advisors Limited was due £215,844 during the year; a bonus of £92,515 was outstanding at the year end. Ian MacLeod (Chairman) through Tenuous Holdings was paid £209,100 as at the year end. Pluto Digital PLC On 3 February 2021 Argo invested in Pluto Digital PLC, a crypto venture capital and technology company. The investment was satisfied with 75,000 Polkadot tokens with a fair value at the time of £1,091,850. Further to this in a second round of funding Argo invested a further £7,352,970 on 8 March 2021. There have been no transactions with this associate during the period. Argo owns 24.65% of the total common stock and voting |
CONTROLLING PARTY
CONTROLLING PARTY | 12 Months Ended |
Dec. 31, 2021 | |
CONTROLLING PARTY | |
CONTROLLING PARTY | 32 . There is no controlling party of the Group. |
POST BALANCE SHEET EVENTS
POST BALANCE SHEET EVENTS | 12 Months Ended |
Dec. 31, 2021 | |
POST BALANCE SHEET EVENTS | |
POST BALANCE SHEET EVENTS | 33. In mid-January 2022 Argo announced that the group invested approximately 10% of the group's crypto assets in its “HODL” to Argo Labs. Argo Labs is the group’s in-house innovation arm established to identify opportunities within the disruptive and innovative sectors of the cryptocurrency ecosystem while supporting the decentralization of various blockchain protocols. Argo Labs is primarily focused on two key areas: network participation and strategic diversification through the efficient deployment of the Company's crypto treasury assets. Network participation consists of providing infrastructure support, running nodes and validators, and staking innovative projects. Efficient deployment of the group's crypto treasury assets includes, among other things, supporting early-stage projects and participating in decentralized finance (DeFi), as well as the NFT & metaverse ecosystem, in each case in furtherance of the group's general business operations. In a statement released 7 January 2022 it was announced that construction of Argo's 200 MW flagship cryptocurrency mining facility, Helios, in Dickens County, Texas facility remains on time and the main structure, outside facade, and roof have now been completed. The next phase of construction and build out of essential infrastructure are ongoing, with a projected completion date in the first half of 2022. Furthermore, in early March 2022 the Company announced that it has placed an order with PA Transformer for four additional Main Power Transformers which will provide an additional 600 MW of total power to Argo's Helios facility. They are identical in specification to the initial order of transformers the group is currently installing on site, and they will be delivered in Q1 and Q2 2023. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Going Concern | Going Concern The preparation of consolidated financial statements requires an assessment on the validity of the going concern assumption. The Directors have reviewed cash flow projections for a period to 31 December 2023. The Group currently has an increasing level of revenues and margin as crypto prices have increased significantly at the end of the year and post the year end. In making their assessment of going concern, the Directors acknowledge that the Group has increasing cash reserves from the exercise of share options and warrants, two private placements and the IPO on Nasdaq during the year. Therefore, the Directors confirm that the Group holds sufficient funds to ensure the Group continues to meet its obligations as they fall due for a period of at least one year from date of approval of these Financial Statements. In addition to cash reserves, the Group also holds £89m of Bitcoin at the year end. As a crypto currency miner, and principally that of mining Bitcoin, the Directors have considered the risk around the price of Bitcoin. The cost to mine each Bitcoin in 2021 was less than £6k and as such there can be a significant fall in Bitcoin price before the Group has a significant issue. Given our relatively low cost of power, we are better positioned than many of our competitors to survive a significant drop in Bitcoin price. In this scenario, our relative share of the global hashrate would increase and we would mine more Bitcoin. As such the Directors have considered the sensitivity around BTC market price and have anticipated and modelled a significant fall in Bitcoin price still allowing the Group to mine at a profitable level. As a result of our diversification into non mining activities, via Argo Labs we consider that we are diversifying and thereby reducing our risk profile as a Group. Since Argo Labs invests in other crypto currencies besides Bitcoin this diversification is at an operating level and a commodity level. The Directors have considered the period to 31 December 2023 as a reasonable time period given the variable outlook of cryptocurrencies. Please see the net debt tables under the cashflows for further information of the Groups exposure to liabilities and net position at the year end. The Directors have considered the impacts of Covid-19 and conclude that there are no material factors that are likely to affect the ability of the Group to continue as a going concern. Accordingly, the Board believes it is appropriate to adopt the going concern basis in the preparation of the Financial Statements. |
Revenue Recognition | Revenue Recognition Mined income: The Group recognized revenue during the period in relation to mined crypto. The Group enters into contracts with the mining pool. The performance obligation is identified to be the delivery of crypto into the Group’s wallet once an algorithm has been solved. The transaction price is the fair value of crypto mined, being the fair value per the prevailing market rate for that crypto currency on the transaction date, and this is allocated to the number of crypto mined. These criteria for performance obligation are assessed to have occurred once the crypto has been received in the Group’s wallet. Mining earnings are made up of the baseline block reward and transaction fees of between 5% to 10%, however, these are bundled together in the daily deposits from mining and therefore are not capable of being analysed separately. Management fees: The Group recognized management fees on the services provided to third parties for management of mining machines on their behalf, ensuring the machines are optimised and mining as efficiently as possible. The performance obligation is identified as the services are performed, and thus revenue is recorded over time. |
Direct Costs | Direct Costs Direct costs of mining revenue are comprised of the fees we pay to third parties to host, operate and maintain our mining machines and utility costs. Where we transitioned to a model in which we own and operate our mining facilities, costs of revenue includes direct facilities costs including utility costs, and personnel costs, including compensation and benefits, associated with operating these owned mining facilities. |
Basis of consolidation | Basis of consolidation Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary. The group consists of Argo Blockchain plc and its wholly owned subsidiaries Argo Innovation Labs Inc, Argo Innovation Facilities (US) Inc, Argo Innovation Labs Inc., 9366-5230 and 9377-2556 and Argo Innovation Labs Limited, the latter remaining dormant. Argo Innovation Labs Limited has been dormant since incorporation. In the parent company financial statements, investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment. The consolidated financial statements incorporate those of Argo Blockchain plc and all of its subsidiaries (i.e. entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes. On the basis that Argo Innovation Labs Limited was dormant during the year and is immaterial to the Group, it was not included in these consolidated financial statements. All financial statements are made up to 31 December 2021. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group. All intra-group transactions, balances and unrealized gains on transactions between group companies are eliminated on consolidation. |
Business Combinations | Business Combinations The group applies the acquisition method to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred to the former owners of the acquire and the equity interests issued by the group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The group recognises any non-controlling interest in the acquire on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest’s proportionate share of the recognized amounts of acquiree’s identifiable net assets. Acquisition-related costs are expensed as incurred. If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognized in profit or loss. Contingent consideration is classified either as equity or as a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value, with changes in fair value recognized in profit or loss. |
Associates | Associates Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting. Under the equity method, the investment is initially recognized at cost, and the carrying amount is increased or decreased to recognise the investor’s share of the profit or loss of the investee after the date of acquisition. The Group’s investment in associates includes goodwill identified on acquisition. If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognized in other comprehensive income is reclassified to profit or loss where appropriate. The Group’s share of post-acquisition profit or loss is recognized in the income statement, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income with a corresponding adjustment to the carrying amount of the investment. When the Group’s share of losses in an associate equal or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate. The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount adjacent to ‘share of profit/(loss) of associates in the income statement. Gains and losses resulting from upstream and downstream transactions between the Group and its associate are recognized in the Group’s financial statements only to the extent of unrelated investor’s interests in the associates. Unrealized losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group. Dilution gains and losses arising in investments in associates are recognized in the income statement. |
Segmental reporting | Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the board of directors that makes strategic decisions. The Directors consider that the Group has only |
Loans and borrowings and issued debt | Loans and borrowings and issued debt Loans and borrowings and issued debt are recognized initially at fair value, net of transaction costs incurred. Loans and borrowings and issued debt are subsequently carried at amortised cost; any difference between the proceeds and the redemption value is recognized in the income statement over the period of the borrowings, using the effective interest method. Loans and borrowings and issued debt are removed from the statement of financial position when the obligation specified in the contract is discharged, cancelled or expired. Loans and borrowings and issued debt are classified as current liabilities unless the Group has an unconditional right to defer settlement of a liability for at least 12 months after the end of the reporting period. |
Intangible assets | Intangible assets Intangible fixed assets comprise of the Group's website and digital assets that were not mined by the Group and are held by Argo Labs (our internal team) as investments. The Group's website is recognized at cost and are subsequently measured at cost less accumulated amortization and accumulated impairment losses. Amortization is recorded within administration expenses. Digital assets recorded under IAS 38 have an indefinite useful life initially measured at cost, and subsequently measured at fair value. Argo’s primary business is focused on cryptocurrency mining, and it typically holds mined crypto assets on its balance sheet. Argo Labs is an in-house innovation arm focused on identifying opportunities within the disruptive and innovative sectors of the broader cryptocurrency ecosystem. Argo Labs uses a portion of Argo’s crypto assets to deploy into various blockchain projects. Currently Argo allocates approximately 10% if its holdings to Argo Labs. Increases in the carrying amount arising on revaluation of digital assets are credited to other comprehensive income and shown as other reserves in shareholders’ equity. Decreases that offset previous increases of the same asset are charged in other comprehensive income and debited against the fair value reserve directly in equity; all other decreases are charged to the income statement. The fair value of intangible cryptocurrencies on hand at the end of the reporting period is calculated as the quantity of cryptocurrencies on hand multiplied by price quoted on www.coingecko.com, one of the leading crypto data sources, as at the reporting date. Costs relating to the development of website are capitalised once all the development phase recognition criteria of IAS 38 "Intangible Assets" are met. Amortization is charged on a straight-line basis over the estimated useful life of 5 years. The useful life represents management's view of the expected period over which the Group will receive benefits from the Website, as well as anticipation of future events which may impact their useful life, such as changes in technology. Goodwill is initially measured at cost (being the excess of the consideration transferred and the amount recognized for non-controlling interests and any previous interest held of the net identifiable assets acquires and liabilities assumed). If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the difference is recognized in profit or loss. If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such remeasurement are recognized in profit or loss. |
Tangible fixed assets | Tangible fixed assets Tangible fixed assets comprise of right of use, office equipment, mining and computer equipment, data centres, leasehold improvements and assets under construction. Right of use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjust for any remeasurement of lease liabilities. The cost of the right of use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right of use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets. Office equipment assets are measured at cost, less any accumulated depreciation and impairment losses. Office equipment is depreciated over 3 years on a straight line basis. Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of amortization and any impairment losses. Cost includes the original purchase price of the asset and any costs attributable to bringing the asset to its working condition for its intended use. An item of property, plant and equipment is recognized as an asset if it is probable that future economic benefits associated with the asset will flow to the entity, and the cost of the asset can be measured reliably Data centres and assets under construction: Depreciation on the data centres and assets under construction is recognized so as to write off the cost or valuation of assets less their residual values over their estimated useful lives of 25 years on a straight-line basis from when they are brought into use. Depreciation is recorded in the Income Statement within general administrative expenses once the asset is brought into use. Any land component is not depreciated. Mining and computer equipment and leasehold improvements: Depreciation is recognized so as to write off the cost or valuation of assets less their residual values over their estimated useful lives of 3 years in the case of mining and computer equipment and 5 years in the case of the leasehold improvements, on a straight line basis. Depreciation is recorded in the Statement of Comprehensive Income within direct costs. Management assesses the useful lives based on historical experience with similar assets as well as anticipation of future events which may impact their useful life. |
Impairment of non-financial assets | Impairment of non-financial assets At each reporting period end date, the Group reviews the carrying amounts of its non-financial assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group and Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. |
Digital assets | Digital assets Digital assets, including tokens and cryptocurrency, do not qualify for recognition as cash and cash equivalents or financial assets, and have an active market which provides pricing information on an ongoing basis. The Group's business model is to mine digital currencies for sale in the ordinary course of business. The Group does not buy or sell digital currencies for third parties, but will move its holdings between digital currencies depending on expected and actual fluctuations in fair values. Although the Group mines for sale in the ordinary course of business, it looks to sell digital assets at a price that will generate the greatest realized gain and at a time when it would need to generate more fiat cash to meet working capital requirements. Thus, the Group may choose not to immediately sell its digital asset holdings after mined. The Group has assessed that it acts in a capacity as a commodity broker-trader as defined in IAS 2, Inventories, in characterising its holding of Digital assets as inventory. If assets held by commodity broker-traders are principally acquired for the purpose of selling in the near future and generating a profit from fluctuations in price or broker-traders’ margin, such assets are accounted for as inventory, and changes in fair value (less costs to sell) are recognized in profit or loss. Digital assets are initially measured at fair value. Subsequently, digital assets are measured at fair value with gains and losses recognized directly in income or loss. Digital assets are included in current assets as management intends to dispose of them within 12 months of the end of the reporting period. Digital assets are cryptocurrencies mined by the Group. Cryptocurrencies not mined by the Group are recorded as Intangible Assets (see note 18). |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents comprise cash at bank and in hand and demand deposits with banks and other financial institutions, that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. The Group considers the credit risk on cash and cash equivalents to be limited because the counterparties are banks with high credit ratings assigned by international credit rating agencies. |
Financial instruments | Financial instruments Financial assets: Financial assets are recognized in the Statement of Financial Position when the Group becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories. The classification depends on the nature and purpose of the financial assets and is determined at the time of recognition. Financial assets are subsequently measured at amortised cost, fair value through OCI, or fair value through profit and loss. The classification of financial assets at initial recognition that are debt instruments depends on the financial asset’s contractual cash flow characteristics and the Group’s business model for managing them. The Group initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. In order for a financial asset to be classified and measured at amortised cost, it needs to give rise to cash flows that are ‘solely payments of principal and interest (SPPI)’ on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. The Group’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Subsequent measurement: For purposes of subsequent measurement, financial assets are classified in four categories: ● Financial assets at amortised cost ● Financial assets at fair value through OCI with recycling of cumulative gains and losses (debt instruments) ● Financial assets designated at fair value through OCI with no recycling of cumulative gains and losses upon derecognition (equity instruments) ● Financial assets at fair value through profit or loss Equity Instruments: The Group subsequently measures all equity investments at fair value.. Dividends from such investments continue to be recognized in profit or loss as other income when the Group’s right to receive payments is established. Changes in the fair value of financial assets at FVPL are recognized in other gains/(losses) in the statement of profit or loss as applicable. Financial assets at amortised cost (debt instruments): This category is the most relevant to the Group. The Group measures financial assets at amortised cost if both of the following conditions are met: ● The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and ● The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortised cost are subsequently measured using the effective interest rate (EIR) method and are subject to impairment. Interest received is recognized as part of finance income in the statement of profit or loss and other comprehensive income. Gains and losses are recognized in profit or loss when the asset is derecognized, modified or impaired. The Group’s financial assets at amortised cost include other receivables and cash and cash equivalents. Derecognition: A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognized (i.e., removed from the Group’s consolidated Balance sheet) when: ● The rights to receive cash flows from the asset have expired; or ● The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues to recognise the transferred asset to the extent of its continuing involvement. In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained. Impairment of financial assets: The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original EIR. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms. The Group recognises an allowance for ECLs for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the original EIR. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL). For the years ended 31 December 2021 and 2020 the Group has not recognized any ECLs. For other receivables due in less than 12 months, the Group applies the simplified approach in calculating ECLs, as permitted by IFRS 9. Therefore, the Group does not track changes in credit risk, but instead, recognises a loss allowance based on the financial asset’s lifetime ECL at each reporting date. The Group considers a financial asset in default when contractual payments are 90 days past due. However, in certain cases, the Group may also consider a financial asset to be in default when internal or external information indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Group. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows and usually occurs when past due for more than one year and not subject to enforcement activity. At each reporting date, the Group assesses whether financial assets carried at amortised cost are credit impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. The Company has an Intercompany loan due from its 100% Canadian subsidiary for which there is no formal agreement including payment date and therefore it cannot be considered to be in breach of an agreement and accordingly the loan is not subject to adjustments and is maintained at its book value in the financial statements. Financial liabilities: Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial liabilities are recognized initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs. The Group’s financial liabilities include trade and other payables and loans. Subsequent measurement: The measurement of financial liabilities depends on their classification, as described below: Loans and borrowings and trade and other payables: After initial recognition, interest-bearing loans and borrowings and trade and other payables are subsequently measured at amortised cost using the EIR method. Gains and losses are recognized in the statement of profit or loss and other comprehensive income when the liabilities are derecognized, as well as through the EIR amortization process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included as finance costs in the statement of profit or loss and other comprehensive income. This category generally applies to trade and other payables. Derecognition: A financial liability is derecognized when the associated obligation is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in profit or loss or other comprehensive income. Equity instruments: Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognized as liabilities once they are no longer at the discretion of the group. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. |
Leases | Leases At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Group uses the definition of a lease in IFRS 16. The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Group by the end of the lease term or the cost of the right-of-use asset reflects that the Group will exercise a purchase option. In that case the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate. Generally, the Group uses its incremental borrowing rate as the discount rate. The Group determines its incremental borrowing rate by obtaining interest rates from various external financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased. The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero. |
Taxation | Taxation The tax expense represents the sum of tax currently payable or receivable and deferred tax. Current tax: The tax currently payable or receivable is based on taxable profit or loss for the year. Taxable profit or loss differs from net profit or loss as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date. Deferred tax: Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Deferred income tax assets are recognized on deductible temporary differences arising from investments in subsidiaries, associates and joint arrangements only to the extent that it is probable the temporary difference will reverse in the future and there is sufficient taxable profit available against which the temporary difference can be utilised. The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realized. Deferred tax is charged or credited to the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority. |
Employee benefits | Employee benefits The costs of short-term employee benefits are recognized as a liability and an expense, unless those costs are required to be recognized as part of non-current assets. The cost of any unused holiday entitlement is recognized in the period in which the employee’s services are received. Termination benefits are recognized immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits. The group does not have any pension schemes. |
Stock based compensation | Stock based compensation Equity-settled share-based payments are measured at fair value at the date of grant by reference to the fair value of the equity instruments granted using the Black-Scholes model. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the estimate of shares that will eventually vest. A corresponding adjustment is made to equity. When the terms and condition of equity settled share-based payments at the time they were granted are subsequently modified, the fair value of the share-based payment under the original terms and conditions and under the modified terms and conditions are both determined at the date of the modification. Any excess of the modified fair value over the original fair value is recognized over the remaining vesting period in addition to the grant date fair value of the original share-based payment. The share-based payment expense is not adjusted if the modified fair value is less than the original fair value. Cancellations or settlements are treated as an acceleration of vesting and the amount that would have been recognized over the remaining vesting period is recognized immediately. As a result of the increase in share price and the impact of the estimation of share-based payments the Group has now recognized an expense for the outstanding share options and warrants. |
Foreign exchange | Foreign exchange Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are determined in foreign currencies are retranslated at the rates prevailing on the reporting end date - Gains and losses arising on translation are included in the income statement for the period. At each reporting end date, non-monetary assets and liabilities that are determined in foreign currencies are retranslated at the rates prevailing on the opening balance sheet date. Gains and losses arising on translation of subsidiary undertakings are included in accumulated other comprehensive income. |
Earnings per share | Earnings per share Basic earnings per share is calculated by dividing: ● the profit attributable to owners of the company, excluding any costs of servicing equity other than ordinary shares; ● by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year and excluding treasury shares. Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account: ● the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares; and ● the weighted average number of additional ordinary shares that would have been outstanding, assuming the conversion of all dilutive potential ordinary shares. |
FINANCIAL RISK FACTORS (Tables)
FINANCIAL RISK FACTORS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL RISK FACTORS | |
Schedule of foreign currency sensitivity | Change in USD Effect on profit Effect on pre- rate before tax tax equity £’000 £’000 2021 +/-10 % +/-250 +/-87 2020 +/-10 % — — Change in CAD Effect on profit Effect on pre- rate before tax tax equity £’000 £’000 2021 +/-10 % +/-1,611 +/-3,208 2020 +/-10 % +/-614 +/-122 |
Schedule of fair value gains | Less than 1 Between 1 and Between 2 year 2 years and 5 years Over 5 years At 31 December 2021 Loans and borrowings 23,901 2,188 693 — Lease liabilities 21 42 63 251 Issued debt — — 26,908 — , At December 2020 Lease liabilities 3,470 3,909 — — |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
REVENUES | |
Schedule of revenues | 2021 2020 £'000 £'000 Crypto currency mining - worldwide 70,325 18,947 Subscriber revenue - worldwide — 10 Crypto currency management fees – United States 3,879 — Total revenue 74,204 18,957 |
EXPENSES BY NATURE (Tables)
EXPENSES BY NATURE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EXPENSES BY NATURE | |
Schedule of expenses by nature | 2021 2020 Direct Costs £’000 £’000 Depreciation of mining hardware 11,129 5,896 Hosting and other costs 11,057 11,210 Total direct costs 22,186 17,106 2021 2020 Administrative expenses £’000 £’000 Salary and other employee related costs 2,662 461 Depreciation and amortization 382 131 Insurance 1,408 117 Public relations and associated activities 699 113 Travel and subsistence 128 46 Audit fees 239 135 Carbon credits 252 — Hedging costs 326 — Impairment of intangible assets 535 — Repairs and maintenance 939 75 Settlement re Crypto mining management fees (1,561) — Write off of variable contingent consideration (352) — Research costs — 20 Other expenses 424 265 Total administrative expenses 6,081 1,363 2021 2020 Finance Costs £’000 £’000 Interest on loans and borrowings 2,142 151 Total finance costs 2,142 151 |
AUDITORS' REMUNERATION (Tables)
AUDITORS' REMUNERATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
AUDITORS' REMUNERATION | |
Schedule of auditor remuneration | 2021 2020 £’000 £’000 In relation to statutory audit services 170 100 Other audit assurance services 52 35 Total auditor’s remuneration 222 135 |
EMPLOYEES (Tables)
EMPLOYEES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EMPLOYEES | |
Schedule of employees | The average monthly number of persons (including directors) employed by the group during the period was: 2021 2020 Number Number Directors and employees 26 6 Their aggregate remuneration comprised: 2021 2020 £’000 £’000 Wages and salaries 2,286 191 Social security costs 199 13 Pension costs 25 — Share based payments 1,392 24 3,902 228 The average monthly number of persons (including directors) employed by the company during the period was: 2021 2020 Number Number Directors and employees 4 1 Their aggregate remuneration comprised: 2021 2020 £’000 £’000 Wages and salaries 406 135 Social security costs 8 18 Pension costs 1 — Share based payments 330 — 745 153 |
DIRECTOR'S REMUNERATION (Tables
DIRECTOR'S REMUNERATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
DIRECTOR'S REMUNERATION | |
Schedule of total remuneration for directors and key management | 2021 2020 £’000 £’000 Director’s remuneration for qualifying services 856 532 Senior management loss of office 132 — Share based payments expense 431 20 Total remuneration for directors and key management 1,416 552 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EARNINGS PER SHARE | |
Schedule of earnings per share | 2021 2020 Net profit for the period attributable to ordinary equity holders from continuing operations (£'000) 30,765 1,442 Weighted average number of ordinary shares in issue ('000) 397,513 303,436 Basic earnings per share for continuing operations (pence) 7.7 0.5 Net profit for the period attributable to ordinary equity holders for continuing operations (£'000) 30,765 1,442 Diluted number of ordinary shares in issue ('000) 415,201 344,638 Diluted earnings per share for continuing operations (pence) 7.4 0.4 |
TAXATION (Tables)
TAXATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
TAXATION | |
Schedule of taxes | 2021 2020 Current tax: £’000 £’000 Current tax on profits for the year 7,679 — Adjustments in respect of prior periods — — Total current tax 7,679 — 2021 2020 Deferred tax: £’000 £’000 Origination and reversal of temporary differences 827 — Total deferred tax 827 — Total tax charge 8,506 — |
Schedule of taxation charge in the financial statements | 2021 2020 £'000 £'000 Profit before taxation 39,271 1,442 Expected tax charge based on a weighted average of 25% (2020 - 24% ) (UK, US and Canada) 9,746 346 Effect of expenses not deductible in determining taxable profit 1,779 3 Capital allowances in excess of depreciation (3,770) (101) Other tax adjustments (137) (141) Unrealized gains/(loss) on crypto assets (385) (562) Origination and reversal of temporary differences 827 — Unutilized tax losses carried forward 445 455 Taxation charge in the financial statements 8,506 — |
Schedule of fair value gains | 2021 2020 Deferred tax liabilities £ '000 £ '000 Fair value gains: Digital assets 286 — Gain on fair value of property acquired (see note 17) 442 — Share of other comprehensive income of associates 99 — Total deferred tax 827 — |
Summary of deferred tax liability | 2021 2020 Deferred tax liabilities £’000 £’000 Current liabilities 286 — Non-current liabilities 541 — Total deferred tax 827 — |
INVESTMENT IN SUBSIDIARIES (Tab
INVESTMENT IN SUBSIDIARIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENT IN SUBSIDIARIES | |
Schedule of details of Company's subsidiaries | Details of the Company’s subsidiaries at 31 December 2021 and 31 December 2020 are as follows: Country of Ownership Voting Power Nature of Name of Undertaking Incorporation Interest (%) Held (%) Business Argo Innovation Labs Inc. Canada 100 % 100 % * Argo Innovation Labs Limited UK 100 % 100 % Dormant Argo Innovation Facilities (US) Inc. USA 100 % 100 % * 9377-2556 Quebec Inc. Canada 100 % 100 % ** 9366-5230 Quebec Inc. Canada 100 % 100 % ** * ** The provision of cryptocurrency mining sites |
Schedule of investments in subsidiaries | 2021 2020 Investment in subsidiaries £’000 £’000 At 1 January — — Additions 12,181 — At 31 December 12,181 — |
INVESTMENTS AT FAIR VALUE THR_2
INVESTMENTS AT FAIR VALUE THROUGH INCOME OR LOSS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENTS AT FAIR VALUE THROUGH INCOME OR LOSS | |
Schedule of investments at fair value through income or loss, non-current | Non-current 2021 2020 £'000 £'000 At 1 January 1,393 58 Additions 219 1,336 Foreign exchange movement — (1) Fair value through income or loss 183 — Disposals (1,392) — At 31 December 403 1,393 |
INVESTMENTS ACCOUNTED FOR USI_2
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD | |
Schedule of investments accounted for using the equity method | 2021 2020 £000 £000 At January 1 — — Acquired during the period 8,444 — Share of loss (1,198) Share of fair value gains on intangible assets through other comprehensive income 6,571 At December 31 13,817 — |
Schedule of nature of investment in associates | Nature of investment in associates: % of Address of the ownership Nature of Measurement Name of entity registered office interest relationship method Pluto Digital PLC Hill Dickinson LLP, 8th Floor The Broadgate Tower, 20 Primrose Street, London, United Kingdom, EC2A 2EW 24.65 % Refer below Equity Summarized Statement of Financial Position Pluto Digital plc As at 31 December 2021 £000 Current Cash and cash equivalents 1,759 Other current assets (excluding cash) 335 Total current assets 2,094 Trade payables 88 Other current liabilities (excluding trade payables) 1,494 Total current liabilities 1,582 Non-current Tangible fixed assets 49 Investments and other non-current assets 56,000 Total non-current assets 56,049 Financial liabilities 2,807 Total non-current liabilities 2,807 Net assets 53,754 Summarized Statement of Comprehensive Income, Pluto Digital plc January 12 – December 31, 2021 £000 Operating costs and expense (7,652) Realized gains – digital assets 2,394 Loss from continuing operations (5,258) Income tax expense 575 Post-tax loss from continuing operations (4,867) Other comprehensive income 26,991 Total comprehensive Income 21,824 |
Schedule of reconciliation of summarised financial information | 2021 £000 Summarized financial information Net assets at acquisition 34,228 Profit/(loss) for the period (4,867) Other comprehensive income 26,691 Foreign exchange differences — Closing net assets 56,052 Interest in associates (24.65%; 0%) 13,817 Goodwill — Carrying value 13,817 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
GPUone Subsidiaries | |
Disclosure of detailed information about business combination [line items] | |
Schedule of consideration paid and the fair value of assets acquired and liabilities assumed at the acquisition date | Consideration £'000 Cash 213 Payment for deposits 668 Cancellation of prepayment and deposits 4,656 Total consideration 5,537 Recognized amounts of identifiable assets acquired, and liabilities assumed £'000 Cash and cash equivalents 4 Property, plant and equipment (Note 11) 10,779 Trade and other receivables 387 Trade and other payables (326) Property mortgages (5,010) Lease liability (377) Goodwill 80 Total 5,537 |
INTANGIBLE FIXED ASSETS (Tables
INTANGIBLE FIXED ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INTANGIBLE FIXED ASSETS | |
Summary of intangible fixed assets | Digital Goodwill assets Website Total £’000 £’000 £’000 £’000 Cost At 1 January 2020 — — 671 671 Addition / Disposals — — — — At 31 December 2020 — — 671 671 Additions 80 18,216 — 18,296 Disposals — (12,792) — (12,792) At 31 December 2021 80 5,424 671 6,175 Amortization and impairment At 1 January 2020 — — 189 189 Amortization charged in the period — — 114 114 At 31 December 2020 — — 303 303 Foreign exchange movement — — 9 9 Impairment — 535 — 535 Fair value gain — (414) — (414) Amortization charged during the period — — 138 138 At 31 December 2021 — 121 450 571 Balance At 31 December 2021 80 5,303 221 5,604 |
Schedule of fair value of crypto assets | As at 31 December 2021 Fair value Crypto asset name Coins/tokens £000 Polkadot – DOT 71,303 1,527 Ethereum - ETH 558 1,415 Cosmos Hub – ATOM 31,789 601 Solana - SOL 6,249 579 USDC (stable coin – fixed to USD) 274,110 203 Alternative coins — 978 At 31 December 2021 — 5,303 |
TANGIBLE FIXED ASSETS (Tables)
TANGIBLE FIXED ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Schedule of property plant and equipment | Mining and Assets Right of Office Computer Under Improvements use Assets Equipment Equipment Construction to data centers Data centers Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 Cost At 1 January 2021 7,379 17,865 — 85 — 25,329 Foreign exchange movement — — (62) — — — (62) Acquisition through business combination 358 — — 12,180 — 10,466 23,004 Additions — 49 33,317 49,126 — — 82,492 Transfer to another class (7,379) — 7,379 — — — At 31 December 2021 358 49 58,499 61,306 85 10,466 130,763 Depreciation and impairment At 1 January 2021 — — 7,443 — 48 — 7,491 Foreign exchange movement — — (65) — — — (65) Depreciation charged during the period 3,281 — 7,856 — 17 229 11,383 Transfer to another class (3,273) — 3,273 — — — — At 30 December 2021 8 — 18,507 — 65 229 18,810 Carrying amount At 1 January 2021 7,379 10,487 — 37 — 17,904 At 31 December 2021 350 49 39,992 61,306 20 10,237 111,954 Right of use Assets Mining and Computer Equipment Data centers including improvements Total £’000 £’000 £’000 £’000 Cost At 1 January 2020 — 17,833 85 17,918 Foreign exchange movement — (136) — (136) Additions 7,379 1,808 — 9,187 Disposals — (1,640) — (1,640) At 31 December 2020 7,379 17,865 85 25,329 Depreciation and impairment At 1 January 2020 — 2,488 31 2,519 Foreign exchange movement — 15 — 15 Depreciation charged during the period — 5,896 17 5,913 Depreciation on Disposals — (1,021) — (1,021) At 31 December 2020 — 7,377 48 7,425 Carrying amount At 1 January 2020 — 15,345 54 15,399 At 31 December 2020 7,379 10,487 37 17,904 |
DPN LLC Inc | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Schedule of consideration paid and the fair value of assets acquired and liabilities assumed at the acquisition date | Consideration at 8 March 2021 £’000 Share based payment 3,521 Contingent consideration to be settled in shares 8,659 Total 12,180 Allocated as follows £’000 Tangible fixed assets (Asset under construction) 12,180 Total 12,180 |
OTHER RECEIVABLES (NON-CURREN_2
OTHER RECEIVABLES (NON-CURRENT) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
OTHER RECEIVABLES (NON-CURRENT) | |
Schedule Of Other Receivables Non Current | 2021 2020 £'000 £'000 Deposits Brought forward 4,115 4,151 Exchange movement — (36) Cancelled on acquisition of GPUone subsidiaries (4,115) — Total carrying amount of other receivables — 4,115 |
TRADE AND OTHER RECEIVABLES I_2
TRADE AND OTHER RECEIVABLES INTERCOMPANY (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
TRADE AND OTHER RECEIVABLES/ INTERCOMPANY | |
Schedule Of Trade And Other Receivables | 2021 2020 £'000 £'000 Prepayments and other receivables 13,194 812 Mining equipment prepayments 47,426 — Other taxation and social security 2,739 1,364 Total trade and other receivables 63,359 2,176 |
DIGITAL ASSETS (Tables)
DIGITAL ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
DIGITAL ASSETS | |
Schedule of crypto assets representing a fair value | 2021 2020 £'000 £'000 At 1 January 4,637 1,041 Additions Crypto assets purchased and received 16,569 9,897 Crypto assets mined 70,325 18,948 Total additions 86,894 28,845 Disposals Crypto assets sold (12,400) (27,318) Total disposals (12,400) (27,318) Fair value movements Gain/(loss) on crypto asset sales 437 (14) Loss on futures — (259) Movements on crypto assets held at the year end 1,191 2,342 Total fair value movements 1,628 2,069 At 31 December 80,759 4,637 Carrying value of digital assets pledged as collateral 49,759 — |
Schedule of Digital assets | As at 31 December 2020 Fair value Crypto asset name Coins/tokens £000 Bitcoin - BTC 183 3,930 Polkadot – DOT 75,000 515 Ethereum - ETH 254 138 Binance Coin - BNB 1,243 34 USDT,USDC & Tether (stable coin – fixed to USD) 26,509 19 Alternative coins — 1 At 31 December 2020 4,637 |
SHARE OPTIONS AND WARRANTS (Tab
SHARE OPTIONS AND WARRANTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SHARE OPTIONS AND WARRANTS | |
Summary of options and warrants over Ordinary Shares have been granted by the company and are outstanding | Number of Number of options/warrants options/warrants Exercise outstanding exercisable Options/ Warrants Grant Date Expiry date Price 2021 ‘000 2021 ‘000 Warrants 15 January 2021 15 January 2031 £1.25 240 240 Warrants 19 April 2021 19 March 2024 £1.35 224 149 Warrants 19 January 2021 18 January 2026 £0.87 110 110 Warrants 17 June 2021 1 March 2024 £1.50 22 22 Options 25 July 2018 25 July 2024 £0.16 1,000 1,000 Options 17 July 2019 16 July 2024 £0.16 537 357 Options 5 February 2020 4 February 2030 £0.07 2,254 1,937 Options 5 February 2020 4 February 2030 £0.07 3,700 3,463 Options 3 February 2021 2 February 2031 £0.94 232 106 Options 27 June 2021 26 June 2031 £1.35 500 83 Options 24 June 2021 23 June 2031 £1.26 1,000 167 Options 1 July 2021 30 June 2031 £1.16 500 83 Options 13 July 2021 12 July 2031 £1.00 1,000 167 Options 22 September 2021 22 September 2031 £1.57 5,000 479 Options 17 December 2021 16 December 2031 £0.86 870 12 Options 23 November 2021 23 November 2031 £1.30 500 14 17,689 8,389 Number of Weighted options and average exercise warrants ‘000 price £ At 1 January 2021 41,776 0.12 Granted 10,698 1.63 Exercised (34,351) 0.12 Lapsed (434) 0.95 Outstanding at 31 December 2021 17,689 0.81 Exercisable at 31 December 2021 7,596 0.26 Number of Weighted options and average exercise warrants ‘000 price £ At 1 January 2020 45,037 0.14 Granted 11,400 0.07 Exercised (9,686) 0.16 Lapsed (4,975) 0.16 Outstanding at 31 December 2020 41,776 0.13 Exercisable at 31 December 2020 34,439 0.13 |
Summary of fair value of options and warrants determined using the Black-Scholes option pricing model | Grant date Grant date share price Exercise price Volatility Life Risk Free interest rate % Marketability discount 25 July 2018 0.08 0.16 40 % 6 years 0.01 75 % 17 July 2019 0.09 0.16 40 % 6 years 0.01 90 % 5 February 2020 0.07 0.07 40 % 6 years 0.01 0 % 15 January 2021 1.07 1.25 112 % 10 years 0.01 0 % 19 January 2021 0.94 0.87 112 % 5 years 0.01 0 % 3 February 2021 0.94 0.94 112 % 10 years 0.01 0 % 19 April 2021 1.35 1.35 112 % 3 years 0.01 0 % 17 June 2021 1.35 1.50 112 % 3 years 0.01 0 % 24 June 2021 1.26 1.26 112 % 10 years 0.01 0 % 27 June 2021 1.35 1.35 112 % 10 years 0.01 0 % 1 July 2021 1.23 1.16 112 % 10 years 0.01 0 % 13 July 2021 1.00 1.00 112 % 10 years 0.01 0 % 22 September 2021 1.57 1.57 112 % 10 years 0.01 0 % 23 November 2021 1.30 1.30 112 % 10 years 0.01 0 % |
COMMON STOCK (Tables)
COMMON STOCK (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
COMMON STOCK | |
Schedule of common stock | As at 31 As at 31 December 2021 December 2020 £'000 £'000 Ordinary share capital Issued and fully paid 303,435,997 Ordinary Shares of £0.001 each 303 294 Issued in the period 164,646,338 Ordinary Shares of £0.001 each 165 — Fully paid not yet issued Ordinary Shares of £0.001 each — 9 468,082,335 Ordinary Shares of £0.001 each 468 303 Additional paid-in capital At beginning of the period 1,540 25,252 Cancelled during the period — (25,252) Issued in the period 150,977 — Issue costs (12,936) — Fully paid not yet issued — 1,540 At the end of period 139,581 1,540 |
TRADE AND OTHER PAYABLES (Table
TRADE AND OTHER PAYABLES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
TRADE AND OTHER PAYABLES | |
Schedule of TRADE AND OTHER PAYABLES | 2021 2020 £'000 £'000 Trade payables 10,259 548 Accruals and other payables 4,986 271 Short term loans — 116 Other taxation and social security — 1 Total trade and other creditors 15,245 936 |
LOANS AND BORROWINGS (Tables)
LOANS AND BORROWINGS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
LOANS AND BORROWINGS | |
Schedule of loans and borrowings | 2021 2020 Non-current liabilities £'000 £'000 Issued debt - bond 26,908 — Assumed mortgage on acquisition 3,391 — Total 30,299 — Current liabilities Short term loan 22,239 — Assumed mortgage on acquisition 1,152 — Total 23,391 — |
LEASE LIABILITIES (Tables)
LEASE LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
LEASE LIABILITIES | |
Schedule of lease liabilities | 2021 2020 £’000 £’000 Lease liability – current 7 3,470 Lease liability – non current 370 3,910 |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
FINANCIAL INSTRUMENTS | |
Schedule of carrying amount of financial assets and liabilities | 2021 2020 £'000 £'000 Carrying amount of financial assets Measured at amortised cost - Mining equipment prepayments 47,426 — - Trade and other receivables 13,194 145 - Cash and cash equivalents 11,803 2,051 Measured at fair value through profit or loss 403 1,393 Total carrying amount of financial assets 72,826 3,589 Carrying amount of financial liabilities Measured at amortised cost - Trade and other payables 10,259 548 - Short term loans 23,391 116 - Long term loans 3,391 — - Issued debt - bonds 26,908 - Lease liabilities 377 7,409 Measured at fair value - Fair value of contingent consideration 8,071 Total carrying amount of financial liabilities 72,397 8,073 |
Schedule of assets and liabilities that are measured at fair value | Level 1 Level 2 Level 3 Total Assets £'000 £'000 £'000 £'000 Financial assets at fair value through profit or loss - Equity holdings 329 — 73 402 - Digital assets — 80,759 — 80,759 Total at 31 December 2021 329 80,759 73 81,161 Liabilities Financial liabilities at fair value through profit or loss - Deferred contingent consideration — — 8,071 8,071 Total at 31 December 2021 — — 8,071 8,071 Level 1 Level 2 Level 3 Total Assets £'000 £'000 £'000 £'000 Financial assets at fair value through profit or loss Equity holdings — — 1,393 1,393 Digital assets — 4,637 — 4,637 Total at 30 December 2020 — 4,637 1,393 6,030 |
ORGANIZATION AND DESCRIPTION _2
ORGANIZATION AND DESCRIPTION OF BUSINESS (Details) | May 11, 2021 | Mar. 04, 2021 | Dec. 21, 2017 |
DPN LLC Inc | |||
Disclosure of detailed information about business combination [line items] | |||
Percentage of equity interests acquired | 100.00% | ||
9377 2556 and 9366 5230 Quebec Inc | |||
Disclosure of detailed information about business combination [line items] | |||
Percentage of equity interests acquired | 100.00% | ||
Argo Blockchain Plc | |||
Disclosure of detailed information about business combination [line items] | |||
Percentage of equity interests acquired | 100.00% | 100.00% |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES - (Details) | 12 Months Ended | ||
Dec. 31, 2021GBP (£)item | Dec. 31, 2020GBP (£) | Dec. 31, 2019GBP (£) | |
Disclosure of associates [line items] | |||
Digital assets | £ 80,759,000 | £ 1,041,000 | |
Number of reportable segments | item | 1 | ||
Allocation of crypto assets (as percent) | 10.00% | ||
Useful life measured | 5 years | ||
Addition to cash reserves on bitcoins | £ 6,000 | ||
Bitcoin - BTC | |||
Disclosure of associates [line items] | |||
Digital assets | £ 3,930,000 | ||
Addition to cash reserves on bitcoins | £ 89,000,000 | ||
Mining And Computer Equipment | |||
Disclosure of associates [line items] | |||
Useful life measured as period of time, property, plant and equipment | 3 years | ||
Improvements To Data Centre | |||
Disclosure of associates [line items] | |||
Useful life measured as period of time, property, plant and equipment | 5 years | ||
Office Equipment | |||
Disclosure of associates [line items] | |||
Useful life measured as period of time, property, plant and equipment | 3 years | ||
Data centers and assets under construction | |||
Disclosure of associates [line items] | |||
Useful life measured as period of time, property, plant and equipment | 25 years | ||
Argo innovation Labs Inc | |||
Disclosure of associates [line items] | |||
Proportion of ownership interest in subsidiary | 100.00% | ||
Minimum | |||
Disclosure of associates [line items] | |||
Percentage of voting rights | 20.00% | ||
Percentage of Transaction Fees | 5.00% | ||
Maximum | |||
Disclosure of associates [line items] | |||
Percentage of voting rights | 50.00% | ||
Percentage of Transaction Fees | 10.00% |
FINANCIAL RISK FACTORS (Details
FINANCIAL RISK FACTORS (Details) £ in Thousands | 12 Months Ended |
Dec. 31, 2021GBP (£) | |
Maximum | |
Disclosure of risk management strategy related to hedge accounting [line items] | |
Amount of cost to mine each Bitcoin | £ 6 |
FINANCIAL RISK FACTORS - Foreig
FINANCIAL RISK FACTORS - Foreign currency sensitivity (Details) - Currency risk - GBP (£) £ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
USD | ||
Disclosure of risk management strategy related to hedge accounting [line items] | ||
Increase in rate | 10.00% | 10.00% |
Decrease in rate | (10.00%) | (10.00%) |
"Increase in effect on profit before tax" | £ 250 | |
"Decrease in effect on profit before tax" | (250) | |
Increase in effect on pre-tax equity | 87 | |
Decrease in effect on pre-tax equity | £ (87) | |
CAD | ||
Disclosure of risk management strategy related to hedge accounting [line items] | ||
Increase in rate | 10.00% | 10.00% |
Decrease in rate | (10.00%) | (10.00%) |
"Increase in effect on profit before tax" | £ 1,611 | £ 614 |
"Decrease in effect on profit before tax" | (1,611) | (614) |
Increase in effect on pre-tax equity | 3,208 | 122 |
Decrease in effect on pre-tax equity | £ (3,208) | £ (122) |
FINANCIAL RISK FACTORS - Contra
FINANCIAL RISK FACTORS - Contractual undiscounted cash flows (Details) - GBP (£) £ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
"Less than 1 year" | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Loans and borrowings | £ 23,901 | |
Lease liabilities | 21 | £ 3,470 |
"Between 1 and 2 years " | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Loans and borrowings | 2,188 | |
Lease liabilities | 42 | £ 3,909 |
"Between 2 and 5 years " | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Loans and borrowings | 693 | |
Lease liabilities | 63 | |
Issued debt | 26,908 | |
Over 5 years | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Lease liabilities | £ 251 |
KEY JUDGEMENTS AND ESTIMATES (D
KEY JUDGEMENTS AND ESTIMATES (Details) - GBP (£) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
KEY JUDGEMENTS AND ESTIMATES | ||
Crypto currency held in market value | £ 80,759,000 | |
Crowd Loans | £ 0 | |
Allocation of crypto assets (as percent) | 10.00% | |
Contingent consideration to be settled in shares | £ 8,071,000 | £ 0 |
REVENUES (Details)
REVENUES (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||
Total revenue | £ 74,204 | £ 18,957 |
United states | Crypto currency management fees | ||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||
Total revenue | 3,879 | |
Worldwide | Crypto currency mining | ||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||
Total revenue | £ 70,325 | 18,947 |
Worldwide | Subscriber revenue | ||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||
Total revenue | £ 10 |
EXPENSES BY NATURE (Details)
EXPENSES BY NATURE (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
EXPENSES BY NATURE | ||
Depreciation of mining hardware | £ 11,129 | £ 5,896 |
Hosting and other costs | 11,057 | 11,210 |
Total direct costs | 22,186 | 17,106 |
Administrative expenses | ||
Salary and other employee related costs | 2,662 | 461 |
Depreciation and amortization | 382 | 131 |
Legal, professional and regulatory fees | 1,533 | 114 |
Insurance | 1,408 | 117 |
Public relations and associated activities | 699 | 113 |
Travel and subsistence | 128 | 46 |
Audit fees | 135 | |
Carbon credits | 252 | |
Hedging costs | 326 | |
Impairment of intangible assets | 535 | |
Repairs and maintenance | 939 | 75 |
Settlement re Crypto mining management fees | (1,561) | |
Write off of variable contingent consideration | (352) | |
Research costs | 20 | |
Other expenses | 424 | 265 |
Total administrative expenses | 6,081 | 1,363 |
Finance Costs | ||
Interest on debt | 2,142 | 151 |
Total finance costs | £ 2,142 | £ 151 |
AUDITORS' REMUNERATION (Details
AUDITORS' REMUNERATION (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
AUDITORS' REMUNERATION | ||
In relation to statutory audit services | £ 170 | £ 100 |
Other audit assurance services | £ 52 | 35 |
Total auditor's remuneration | £ 135 |
EMPLOYEES - Aggregate remunerat
EMPLOYEES - Aggregate remuneration comprised (Details) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021GBP (£)director | Dec. 31, 2020GBP (£)director | |
Classes of employee benefits expense [abstract] | ||
Share based payment | £ 1,938 | £ 331 |
Employed by group | ||
Disclosure of defined benefit plans [line items] | ||
Directors and employees | director | 26 | 6 |
Classes of employee benefits expense [abstract] | ||
Wages and salaries | £ 2,286 | £ 191 |
Social security costs | 199 | 13 |
Pension costs | 25 | |
Share based payment | 1,392 | 24 |
Employee benefits expense | £ 3,902 | £ 228 |
Employed by company | ||
Disclosure of defined benefit plans [line items] | ||
Directors and employees | director | 4 | 1 |
Classes of employee benefits expense [abstract] | ||
Wages and salaries | £ 406 | £ 135 |
Social security costs | 8 | 18 |
Pension costs | 1 | |
Share based payment | 330 | |
Employee benefits expense | £ 745 | £ 153 |
DIRECTOR'S REMUNERATION (Detail
DIRECTOR'S REMUNERATION (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
DIRECTOR'S REMUNERATION | ||
Director's remuneration for qualifying services | £ 856 | £ 532 |
Senior management loss of office | 132 | |
Share based payments expense | 431 | 20 |
Total remuneration for directors and key management | £ 1,416 | £ 552 |
DIRECTOR'S REMUNERATION - Addit
DIRECTOR'S REMUNERATION - Additional Information (Details) - GBP (£) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
DIRECTOR'S REMUNERATION | ||
Highest paid to director - Peter Wall | £ 455,000 | £ 251,000 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - GBP (£) £ / shares in Units, £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
EARNINGS PER SHARE | ||
Net profit for the period attributable to ordinary equity holders from continuing operations | £ 30,765 | £ 1,442 |
Weighted average number of ordinary shares in issue | 397,513,000 | 303,436,000 |
Basic earnings per share for continuing operations (pence) | £ 7.7 | £ 0.5 |
Diluted number of ordinary shares in issue | 415,201,000 | 344,638,000 |
Diluted earnings per share for continuing operations (pence) | £ 7.4 | £ 0.4 |
Number of warrants and options issued | 17,688,897 | 41,202,382 |
TAXATION (Details)
TAXATION (Details) - GBP (£) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2021 | |
Current tax: | |||
Current tax on profits for the year | £ 7,679,000 | ||
Total current tax | 7,679,000 | ||
Deferred tax: | |||
Origination and reversal of temporary differences | 827,000 | ||
Total deferred tax | 827,000 | ||
Total tax charge | 8,506,000 | ||
Profit before taxation | 39,271,000 | £ 1,442,000 | |
Expected tax charge based on a weighted average of 24% (UK, US and Canada) | 9,746,000 | 346,000 | |
Effect of expenses not deductible in determining taxable profit | 1,779,000 | 3,000 | |
Capital allowances in excess of depreciation | (3,770,000) | (101,000) | |
Other tax adjustments | (137,000) | (141,000) | |
Unrealized gains/(loss) on crypto assets | (385,000) | (562,000) | |
Origination and reversal of temporary differences | 827,000 | ||
Unutilised tax losses carried forward | 445,000 | £ 455,000 | |
Deferred tax expense | 8,506,000 | ||
Taxation charge in the financial statements | £ 8,506,000 | ||
Weighted average tax rate | 25.00% | 24.00% | |
Tax losses available to be carried forward and used against trading profits arising in future periods | £ 10,476,000 | £ 10,031,000 | |
No deferred tax asset has been recognised on the UK and US | £ 0 |
TAXATION - Income tax expense (
TAXATION - Income tax expense (Details) £ in Thousands | 12 Months Ended |
Dec. 31, 2021GBP (£) | |
TAXATION | |
Fair value gains: Digital assets | £ 286 |
Fair value gains: Gain on fair value of property acquired | 442 |
Fair value gains: Share of other comprehensive income of associates | 99 |
Total deferred tax | £ 827 |
TAXATION - Deferred tax liabili
TAXATION - Deferred tax liability (Details) £ in Thousands | Dec. 31, 2021GBP (£) |
TAXATION | |
Deferred tax liabilities, Current liabilities | £ 286 |
Deferred tax liabilities, Non-current liabilities | 541 |
Total deferred tax | £ 827 |
INVESTMENT IN SUBSIDIARIES (Det
INVESTMENT IN SUBSIDIARIES (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Argo innovation Labs Inc. | |
Disclosure of subsidiaries [line items] | |
Name of Undertaking | Argo Innovation Labs Inc. |
Country of Incorporation | Canada |
Ownership Interest (%) | 100.00% |
Voting Power Held (%) | 100.00% |
Argo Innovation Labs Limited | |
Disclosure of subsidiaries [line items] | |
Name of Undertaking | Argo Innovation Labs Limited |
Country of Incorporation | UK |
Ownership Interest (%) | 100.00% |
Voting Power Held (%) | 100.00% |
Argo Innovation Facilities (US) Inc | |
Disclosure of subsidiaries [line items] | |
Name of Undertaking | Argo Innovation Facilities (US) Inc. |
Country of Incorporation | USA |
Ownership Interest (%) | 100.00% |
Voting Power Held (%) | 100.00% |
9377-2556 Quebec Inc. | |
Disclosure of subsidiaries [line items] | |
Country of Incorporation | Canada |
Ownership Interest (%) | 100.00% |
Voting Power Held (%) | 100.00% |
9366-5230 Quebec Inc. | |
Disclosure of subsidiaries [line items] | |
Country of Incorporation | Canada |
Ownership Interest (%) | 100.00% |
Voting Power Held (%) | 100.00% |
INVESTMENT IN SUBSIDIARIES - Ad
INVESTMENT IN SUBSIDIARIES - Additional Information (Details) | 12 Months Ended | |||
Dec. 31, 2021GBP (£) | Dec. 31, 2020GBP (£) | May 11, 2021GBP (£) | Sep. 01, 2019USD ($) | |
Disclosure of detailed information about business combination [line items] | ||||
At 1 January | £ 0 | £ 0 | ||
Additions | 12,181,000 | 0 | ||
At 31 December | £ 12,181,000 | £ 0 | ||
Cash paid to acquire business | £ 213,000 | |||
Argo Mining Limited | ||||
Disclosure of detailed information about business combination [line items] | ||||
Percentage of equity interests acquired | 100.00% | |||
Cash paid to acquire business | $ | $ 1 |
INVESTMENTS AT FAIR VALUE THR_3
INVESTMENTS AT FAIR VALUE THROUGH INCOME OR LOSS (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Non-current | ||
At 1 January | £ 1,393 | £ 58 |
Additions | 219 | 1,336 |
Foreign exchange movement | (1) | |
Fair value through income and loss | 183 | |
At 31 December | 403 | £ 1,393 |
Disposed of in the period | £ (1,392) |
INVESTMENTS AT FAIR VALUE THR_4
INVESTMENTS AT FAIR VALUE THROUGH INCOME OR LOSS - Additional Information (Details) | Aug. 20, 2021GBP (£) | Jun. 03, 2021GBP (£)shares | Dec. 31, 2021GBP (£) | Dec. 31, 2021GBP (£)$ / shares | Jun. 03, 2021CAD ($) | May 11, 2021GBP (£) | Dec. 31, 2020GBP (£) | Dec. 07, 2020GBP (£) | Dec. 07, 2020USD ($) | Dec. 31, 2019GBP (£) |
Schedule of Investments [Line Items] | ||||||||||
Cash paid to acquire business | £ 213,000 | |||||||||
Non-current investment | £ 403,000 | £ 403,000 | £ 1,393,000 | £ 58,000 | ||||||
Proceeds from sale of non-current investments | £ 772,000 | |||||||||
Fair value adjustment of investment | £ 183,000 | |||||||||
Luxor Technology Corporation | ||||||||||
Schedule of Investments [Line Items] | ||||||||||
Cash paid to acquire business | £ 73,427 | $ 100,000 | ||||||||
Luxor Technology Corporation | Maximum | ||||||||||
Schedule of Investments [Line Items] | ||||||||||
Percentage of investment | 1.00% | 1.00% | ||||||||
WonderFi Technologies Inc. | ||||||||||
Schedule of Investments [Line Items] | ||||||||||
Cash paid to acquire business | £ 145,933 | $ 250,000 | ||||||||
Investment share price | $ / shares | £ 2.25 | |||||||||
Number of shares acquired | shares | 250,000 | |||||||||
WonderFi Technologies Inc. | Maximum | ||||||||||
Schedule of Investments [Line Items] | ||||||||||
Percentage of investment | 1.00% | 1.00% | ||||||||
GPUone Holding Inc. | ||||||||||
Schedule of Investments [Line Items] | ||||||||||
Percentage of ownership disposed | 100.00% | |||||||||
Total consideration for disposal of investment | £ 764,000 | |||||||||
Proceeds from sale of non-current investments | 128,000 | |||||||||
Loss on sale of investment | £ 629,000 |
INVESTMENTS ACCOUNTED FOR USI_3
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD (Details) £ in Thousands | 12 Months Ended |
Dec. 31, 2021GBP (£) | |
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD | |
At January 1 | £ 0 |
Acquired during the period | 8,444 |
Share of loss | (1,198) |
Share of fair value gains on intangible assets | 6,571 |
At December 31 | £ 13,817 |
INVESTMENTS ACCOUNTED FOR USI_4
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD - Nature of investment in associates (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Pluto Digital PLC | |
Disclosure of associates [line items] | |
% of ownership interest | 24.65% |
INVESTMENTS ACCOUNTED FOR USI_5
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD - Summarized Statement of Financial Position (Details) - GBP (£) | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Current | |||
Cash and cash equivalents | £ 11,803,000 | £ 2,051,000 | £ 161,000 |
Total current assets | 155,921,000 | 8,864,000 | |
Trade payables | 15,245,000 | 936,000 | |
Total current liabilities | 54,679,000 | 4,406,000 | |
Non-current | |||
Tangible fixed assets | 111,604,000 | 10,524,000 | |
Total non-current assets | 131,778,000 | 23,779,000 | |
Net assets | 65,403,000 | £ 691,000 | |
Pluto Digital PLC | |||
Current | |||
Cash and cash equivalents | 1,759,000 | ||
Other current assets (excluding cash) | 335,000 | ||
Total current assets | 2,094,000 | ||
Trade payables | 88,000 | ||
Other current liabilities (excluding trade payables) | 1,494,000 | ||
Total current liabilities | 1,582,000 | ||
Non-current | |||
Tangible fixed assets | 49,000 | ||
Investments and other non-current assets | 56,000,000 | ||
Total non-current assets | 56,049,000 | ||
Financial liabilities | 2,807,000 | ||
Total non-current liabilities | 2,807,000 | ||
Net assets | £ 53,754,000 |
INVESTMENTS ACCOUNTED FOR USI_6
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD - Summarized Statement of Comprehensive Income (Details) - GBP (£) £ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of associates [line items] | |||
Operating costs and expense | £ (10,825) | £ (2,322) | |
Income before income taxes | 39,271 | 1,442 | |
Income tax expense | 8,506 | ||
Other comprehensive income | 6,575 | 265 | |
Total comprehensive income for the period | £ 37,340 | £ 1,707 | |
Pluto Digital PLC | |||
Disclosure of associates [line items] | |||
Operating costs and expense | £ (7,652) | ||
Realised gains - digital assets | 2,394 | ||
Income before income taxes | (5,258) | ||
Income tax expense | 575 | ||
Post-tax loss from continuing operations | (4,867) | ||
Other comprehensive income | 26,991 | ||
Total comprehensive income for the period | £ 21,824 |
INVESTMENTS ACCOUNTED FOR USI_7
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD - Reconciliation of summarized financial information (Details) - GBP (£) £ in Thousands | Feb. 03, 2021 | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of associates [line items] | |||
Net assets at acquisition | £ 32,643 | ||
Profit (Loss) for the period | 30,765 | £ 1,442 | |
Other comprehensive income | 6,575 | 265 | |
Foreign exchange differences | (410) | 265 | |
Closing net assets | 287,699 | 32,643 | |
Goodwill | 80 | ||
Associates [member] | |||
Disclosure of associates [line items] | |||
Net assets at acquisition | 34,228 | ||
Profit (Loss) for the period | (4,867) | ||
Other comprehensive income | 26,691 | ||
Closing net assets | 56,052 | £ 34,228 | |
Interest in associates (24.65%; 0%) | 13,817 | ||
Carrying value | £ 13,817 | ||
% of ownership interest | 24.65% | 24.65% | 0.00% |
INVESTMENTS ACCOUNTED FOR USI_8
INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD - Additional information (Details) | Feb. 03, 2021GBP (£) | Dec. 31, 2021GBP (£)director£ / sharesshares | Feb. 08, 2021GBP (£) | Dec. 31, 2020GBP (£) | Dec. 31, 2019GBP (£) |
Disclosure of associates [line items] | |||||
Number of Polkadot satisfied in respect of the acquisition of shares | 75,000 | ||||
Fair value of Polkadot satisfied in respect of the acquisition of shares | £ 1,092,000 | ||||
Investments accounted for using the equity method | £ 13,817,000 | £ 0 | £ 0 | ||
Number of warrants hold | shares | 121,666,666 | ||||
Warrants at price of 0.12 [Member] | |||||
Disclosure of associates [line items] | |||||
Price of warrants | £ / shares | £ 0.12 | ||||
Warrants at price of 0.06 [Member] | |||||
Disclosure of associates [line items] | |||||
Number of warrants hold | shares | 35,450,000 | ||||
Price of warrants | £ / shares | £ 0.06 | ||||
Ownership percentage on diluted basis | 33.26% | ||||
Pluto Digital PLC | |||||
Disclosure of associates [line items] | |||||
Number of Polkadot satisfied in respect of the acquisition of shares | 75,000,000 | ||||
Fair value of Polkadot satisfied in respect of the acquisition of shares | £ 1,091,850 | ||||
Investments accounted for using the equity method | £ 7,352,970 | ||||
Percentage of share capital and voting rights | 24.65% | ||||
Number of directors can be nominated to the Pluto Board of Directors | director | 1 | ||||
Contingent liabilities relating to the interest in associates | £ 0 |
BUSINESS COMBINATION - Addition
BUSINESS COMBINATION - Additional Information (Details) - GBP (£) | 8 Months Ended | |
Dec. 31, 2021 | May 11, 2021 | |
Disclosure of detailed information about business combination [line items] | ||
Cash consideration | £ 213,000 | |
GPUone Subsidiaries | ||
Disclosure of detailed information about business combination [line items] | ||
Percentage of share capital acquired | 100.00% | |
Total consideration | £ 5,537,000 | |
Cash consideration | 213,000 | |
GPUone subsidiaries' loss since the acquisition date | £ (3,369,000) | |
GPUone subsidiaries' revenue since the acquisition date | £ 0 | |
Deposits and other receivables acquired | 668,000 | |
Acquisition costs included in consideration | £ 0 |
BUSINESS COMBINATION (Details)
BUSINESS COMBINATION (Details) | May 11, 2021GBP (£) |
Consideration at 11 May 2021 | |
Cash | £ 213,000 |
GPUone Subsidiaries | |
Consideration at 11 May 2021 | |
Cash | 213,000 |
Payment for deposits | 668,000 |
Cancellation of prepayment and deposits | 4,656,000 |
Total consideration | 5,537,000 |
Recognised amounts of identifiable assets acquired, and liabilities assumed | |
Cash and cash equivalents | 4,000 |
Property, plant and equipment (Note 11) | 10,779,000 |
Trade and other receivables | 387,000 |
Trade and other payables | (326,000) |
Property mortgages | (5,010,000) |
Lease liability | (377,000) |
Goodwill | 80,000 |
Total | £ 5,537,000 |
INTANGIBLE FIXED ASSETS (Detail
INTANGIBLE FIXED ASSETS (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Balance at the beginning | £ 368 | |
Impairment of intangible assets | 535 | |
Balance at the end | 5,604 | £ 368 |
Goodwill at the end | 80 | |
Cost | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Balance at the beginning | 671 | 671 |
Additions | 18,296 | |
Disposals | (12,792) | |
Balance at the end | 6,175 | 671 |
Goodwill, additions | 80 | |
Goodwill at the end | 80 | |
Accumulated depreciation, amortization and impairment [member] | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Balance at the beginning | (303) | (189) |
Foreign exchange movement | 9 | |
Impairment of intangible assets | 535 | |
Fair value gain | (414) | |
Amortization charged during the period | 138 | 114 |
Balance at the end | (571) | (303) |
Digital Assets | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Balance at the end | 5,303 | |
Digital Assets | Cost | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Additions | 18,216 | |
Disposals | (12,792) | |
Balance at the end | 5,424 | |
Digital Assets | Accumulated depreciation, amortization and impairment [member] | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Impairment of intangible assets | 535 | |
Fair value gain | (414) | |
Balance at the end | (121) | |
Website | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Balance at the end | 221 | |
Website | Cost | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Balance at the beginning | 671 | 671 |
Balance at the end | 671 | 671 |
Website | Accumulated depreciation, amortization and impairment [member] | ||
Reconciliation of changes in intangible assets other than goodwill [abstract] | ||
Balance at the beginning | (303) | (189) |
Foreign exchange movement | 9 | |
Amortization charged during the period | 138 | 114 |
Balance at the end | £ (450) | £ (303) |
INTANGIBLE FIXED ASSETS - Movem
INTANGIBLE FIXED ASSETS - Movement in fair value in crypto assets (Details) £ in Thousands | Dec. 31, 2021GBP (£)item | Dec. 31, 2020GBP (£)item |
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 5,604 | £ 368 |
Digital Assets | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | 5,303 | |
Website | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 221 | |
Polkadot - DOT | ||
Disclosure of detailed information about intangible assets [line items] | ||
Coins/tokens | item | 71,303 | 75,000 |
Polkadot - DOT | Digital Assets | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 1,527 | |
Ethereum - ETH | ||
Disclosure of detailed information about intangible assets [line items] | ||
Coins/tokens | item | 558 | 254 |
Ethereum - ETH | Digital Assets | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 1,415 | |
Cosmos Hub | ||
Disclosure of detailed information about intangible assets [line items] | ||
Coins/tokens | item | 31,789 | |
Cosmos Hub | Digital Assets | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 601 | |
Solana | ||
Disclosure of detailed information about intangible assets [line items] | ||
Coins/tokens | item | 6,249 | |
Solana | Digital Assets | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 579 | |
Binance Coin - BNB | ||
Disclosure of detailed information about intangible assets [line items] | ||
Coins/tokens | item | 1,243 | |
USDT,USDC & Tether (stable coin - fixed to USD) | ||
Disclosure of detailed information about intangible assets [line items] | ||
Coins/tokens | item | 274,110 | 26,509 |
USDT,USDC & Tether (stable coin - fixed to USD) | Digital Assets | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 203 | |
Alternative coins | Digital Assets | ||
Disclosure of detailed information about intangible assets [line items] | ||
Intangible assets | £ 978 |
TANGIBLE FIXED ASSETS (Details)
TANGIBLE FIXED ASSETS (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Depreciation and impairment | ||
At 1 January | £ 17,904 | £ 15,399 |
At 31 December | 111,954 | 17,904 |
Cost | ||
Cost | ||
At 1 January | 25,329 | 17,918 |
Foreign exchange movement | (62) | (136) |
Acquisition through business combination | 23,004 | |
Additions | 82,492 | 9,187 |
At 31 December | 130,763 | 25,329 |
Depreciation and impairment | ||
Disposals | (1,640) | |
Depreciation and impairment | ||
Cost | ||
Foreign exchange movement | (65) | 15 |
Depreciation and impairment | ||
At 1 January | 7,491 | 2,519 |
Depreciation charged during the period | 11,383 | 5,913 |
Disposals | (1,021) | |
At 30 December | 18,810 | 7,491 |
At 1 January | 7,425 | |
At 31 December | 7,425 | |
Right of use Assets | ||
Depreciation and impairment | ||
At 1 January | 7,379 | |
At 31 December | 350 | 7,379 |
Right of use Assets | Cost | ||
Cost | ||
At 1 January | 7,379 | |
Acquisition through business combination | 358 | |
Additions | 7,379 | |
At 31 December | 358 | 7,379 |
Depreciation and impairment | ||
Transfer to another class | (7,379) | |
Right of use Assets | Depreciation and impairment | ||
Depreciation and impairment | ||
Depreciation charged during the period | 3,281 | |
Transfer to another class | (3,273) | |
At 30 December | 8 | |
Mining And Computer Equipment | ||
Depreciation and impairment | ||
At 1 January | 10,487 | 15,345 |
At 31 December | 39,992 | 10,487 |
Mining And Computer Equipment | Cost | ||
Cost | ||
At 1 January | 17,865 | 17,833 |
Foreign exchange movement | (62) | (136) |
Additions | 33,317 | 1,808 |
At 31 December | 58,499 | 17,865 |
Depreciation and impairment | ||
Transfer to another class | 7,379 | |
Disposals | (1,640) | |
Mining And Computer Equipment | Depreciation and impairment | ||
Cost | ||
Foreign exchange movement | (65) | 15 |
Depreciation and impairment | ||
At 1 January | 7,443 | 2,488 |
Depreciation charged during the period | 7,856 | 5,896 |
Transfer to another class | 3,273 | |
Disposals | (1,021) | |
At 30 December | 18,507 | 7,443 |
At 1 January | 7,377 | |
At 31 December | 7,377 | |
Office Equipment | ||
Depreciation and impairment | ||
At 31 December | 49 | |
Office Equipment | Cost | ||
Cost | ||
Additions | 49 | |
At 31 December | 49 | |
Assets Under Construction | ||
Depreciation and impairment | ||
At 31 December | 61,306 | |
Assets Under Construction | Cost | ||
Cost | ||
Acquisition through business combination | 12,180 | |
Additions | 49,126 | |
At 31 December | 61,306 | |
Data centers | ||
Depreciation and impairment | ||
At 31 December | 10,237 | |
Data centers | Cost | ||
Cost | ||
Acquisition through business combination | 10,466 | |
At 31 December | 10,466 | |
Data centers | Depreciation and impairment | ||
Depreciation and impairment | ||
Depreciation charged during the period | 229 | |
At 30 December | 229 | |
Improvements to data centers | ||
Depreciation and impairment | ||
At 1 January | 37 | |
At 31 December | 20 | 37 |
Improvements to data centers | Cost | ||
Cost | ||
At 1 January | 85 | |
At 31 December | 85 | 85 |
Improvements to data centers | Depreciation and impairment | ||
Depreciation and impairment | ||
At 1 January | 48 | |
Depreciation charged during the period | 17 | |
At 30 December | 65 | 48 |
Data centers including improvements | ||
Depreciation and impairment | ||
At 1 January | 37 | 54 |
At 31 December | 37 | |
Data centers including improvements | Cost | ||
Cost | ||
At 1 January | 85 | 85 |
At 31 December | 85 | |
Data centers including improvements | Depreciation and impairment | ||
Depreciation and impairment | ||
At 1 January | 31 | |
Depreciation charged during the period | 17 | |
At 1 January | £ 48 | |
At 31 December | £ 48 |
TANGIBLE FIXED ASSETS - Acquisi
TANGIBLE FIXED ASSETS - Acquisition of DPN LLC (Details) | Mar. 08, 2021GBP (£)aEquityInstruments | Dec. 31, 2021GBP (£) | Dec. 31, 2020GBP (£) |
Disclosure of detailed information about property, plant and equipment [line items] | |||
Contingent consideration to be settled in shares | £ 8,071,000 | £ 0 | |
DPN LLC Inc | |||
Disclosure of detailed information about property, plant and equipment [line items] | |||
Area of land acquired | a | 160 | ||
Option to purchase further land | a | 157 | ||
Consideration | £ 3,600,000 | ||
Issue and allotment of share | EquityInstruments | 3,497,817 | ||
Share based payment issued | £ 3,521,000 | ||
Contingent consideration to be settled in shares | 8,659,000 | ||
Tangible fixed assets (Land) | 12,180,000 | ||
Total | £ 12,180,000 |
OTHER RECEIVABLES (NON-CURREN_3
OTHER RECEIVABLES (NON-CURRENT) (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
OTHER RECEIVABLES (NON-CURRENT) | ||
Brought forward | £ 4,115 | £ 4,151 |
Exchange movement | (36) | |
Cancelled on acquisition of GPUone subsidiaries | £ (4,115) | |
Total carrying amount of other receivables | £ 4,115 |
TRADE AND OTHER RECEIVABLES I_3
TRADE AND OTHER RECEIVABLES INTERCOMPANY (Details) $ in Millions | Dec. 31, 2021GBP (£) | Dec. 31, 2021USD ($) | Dec. 31, 2020GBP (£) |
Condensed Financial Statements, Captions [Line Items] | |||
Total trade and other receivables | £ 63,359,000 | £ 2,175,000 | |
Payments in advance to related parties | 41,630,000 | ||
ePIC | |||
Condensed Financial Statements, Captions [Line Items] | |||
Prepayments and other receivables | 13,194,000 | 812,000 | |
Mining equipment prepayments | 47,426,000 | ||
Other taxation and social security | 2,739,000 | 1,364,000 | |
Total trade and other receivables | 63,359,000 | £ 2,176,000 | |
Payments to related parties | 3,430,000 | ||
Amount deposited | $ | $ 5 | ||
True North | |||
Condensed Financial Statements, Captions [Line Items] | |||
Payments to related parties | £ 2,366,000 |
DIGITAL ASSETS (Details)
DIGITAL ASSETS (Details) - GBP (£) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||
Balance at the beginning | £ 1,041,000 | |
Additions, Digital Assets [Abstract] | ||
Crypto assets mined | £ 70,325,000 | 18,948,000 |
Crypto asset purchased and received | 16,569,000 | 9,897,000 |
Total additions | 86,894,000 | 28,845,000 |
Disposals, Digital Assets [Abstract] | ||
Crypto assets sold | (12,400,000) | (27,318,000) |
Total disposals | (12,400,000) | (27,318,000) |
Fair Value Movements, Digital Assets [Abstract] | ||
Gain/(loss) on crypto asset sales | 437,000 | (14,000) |
Loss on futures | (259,000) | |
Movements on crypto assets held at the period end | 1,191,000 | 2,342,000 |
Total fair value movements | 1,628,000 | £ 2,069,000 |
Balance at the end | 80,759,000 | |
Carrying value of digital assets pledged as collateral | 49,759,000 | |
Crypto Assets [Member] | ||
Fair Value Movements, Digital Assets [Abstract] | ||
Balance at the end | £ 80,759,000 |
DIGITAL ASSETS - Crypto assets
DIGITAL ASSETS - Crypto assets representing a fair value (Details) | Sep. 10, 2021item | Dec. 31, 2021GBP (£)item | Dec. 31, 2020GBP (£)item | Dec. 31, 2019GBP (£) |
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Fair value of crypto assets | £ 80,759,000 | £ 1,041,000 | ||
Number of bitcoins transferred | item | 1,504 | |||
Number of Bitcoins comprised | item | 2,441 | |||
Crypto Assets [Member] | ||||
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Fair value of crypto assets | £ 80,759,000 | |||
Bitcoin - BTC | ||||
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Coins/tokens | item | 183 | |||
Fair value of crypto assets | £ 3,930,000 | |||
Polkadot - DOT | ||||
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Coins/tokens | item | 71,303 | 75,000 | ||
Fair value of crypto assets | £ 515,000 | |||
Ethereum - ETH | ||||
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Coins/tokens | item | 558 | 254 | ||
Fair value of crypto assets | £ 138,000 | |||
Binance Coin - BNB | ||||
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Coins/tokens | item | 1,243 | |||
Fair value of crypto assets | £ 34,000 | |||
USDT,USDC & Tether (stable coin - fixed to USD) | ||||
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Coins/tokens | item | 274,110 | 26,509 | ||
Fair value of crypto assets | £ 19,000 | |||
Alternative coins | ||||
Disclosure Of Detailed Information About Digital Assets [Line Items] | ||||
Fair value of crypto assets | £ 1,000 |
DIGITAL ASSETS - Textual inform
DIGITAL ASSETS - Textual information (Details) | Sep. 10, 2021item | Dec. 31, 2021GBP (£) | Dec. 31, 2019GBP (£) |
Disclosure Of Detailed Information About Digital Assets [Line Items] | |||
Fair value of crypto assets | £ 80,759,000 | £ 1,041,000 | |
Number of bitcoins transferred | item | 1,504 | ||
Crypto Assets [Member] | |||
Disclosure Of Detailed Information About Digital Assets [Line Items] | |||
Fair value of crypto assets | £ 80,759,000 |
SHARE OPTIONS AND WARRANTS (Det
SHARE OPTIONS AND WARRANTS (Details - options and warrants outstanding and exercisable) Unit_Standard_pure_iZslO8HNb0uXQp9NAErPAA in Thousands, EquityInstruments in Thousands | Dec. 31, 2021£ / shares | Dec. 31, 2021EquityInstruments | Dec. 31, 2021 | Dec. 31, 2020EquityInstruments | Dec. 31, 2019EquityInstruments£ / shares |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | £ 0.81 | £ 0.14 | |||
Number of options/warrants outstanding | 17,689 | 17,689 | 41,776 | 45,037 | |
Number of options/warrants exercisable | 7,596 | 8,389 | 34,439 | ||
Warrants with grant date 15 January 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1.25 | ||||
Number of options/warrants outstanding | 240 | ||||
Number of options/warrants exercisable | 240 | ||||
Warrants with grant date 19 April 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1.35 | ||||
Number of options/warrants outstanding | 224 | ||||
Number of options/warrants exercisable | 149 | ||||
Warrants with grant date 19 January 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 0.87 | ||||
Number of options/warrants outstanding | 110 | ||||
Number of options/warrants exercisable | 110 | ||||
Warrants with grant date 17 June 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1.50 | ||||
Number of options/warrants outstanding | 22 | ||||
Number of options/warrants exercisable | 22 | ||||
Options with grant date 25 July 2018 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 0.16 | ||||
Number of options/warrants outstanding | 1,000 | ||||
Number of options/warrants exercisable | 1,000 | ||||
Options with grant date 17 July 2019 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 0.16 | ||||
Number of options/warrants outstanding | 537 | ||||
Number of options/warrants exercisable | 357 | ||||
Options with grant date 5 February 2020, one | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 0.07 | ||||
Number of options/warrants outstanding | 2,254 | ||||
Number of options/warrants exercisable | 1,937 | ||||
Options with grant date 5 February 2020, two | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 0.07 | ||||
Number of options/warrants outstanding | 3,700 | ||||
Number of options/warrants exercisable | 3,463 | ||||
Options with grant date 3 February 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 0.94 | ||||
Number of options/warrants outstanding | 232 | ||||
Number of options/warrants exercisable | 106 | ||||
Options with grant date 27 June 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1.35 | ||||
Number of options/warrants outstanding | 500 | ||||
Number of options/warrants exercisable | 83 | ||||
Options with grant date 24 June 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1.26 | ||||
Number of options/warrants outstanding | 1,000 | ||||
Number of options/warrants exercisable | 167 | ||||
Options with grant date 1 July 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1.16 | ||||
Number of options/warrants outstanding | 500 | ||||
Number of options/warrants exercisable | 83 | ||||
Options with grant date 13 July 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1 | ||||
Number of options/warrants outstanding | 1,000 | ||||
Number of options/warrants exercisable | 167 | ||||
Options with grant date 22 September 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 1.57 | ||||
Number of options/warrants outstanding | 5,000 | ||||
Number of options/warrants exercisable | 479 | ||||
Options with grant date 17 December 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | 0.86 | ||||
Number of options/warrants outstanding | 870 | ||||
Number of options/warrants exercisable | 12 | ||||
Options with grant date 23 November 2021 | |||||
Disclosure of terms and conditions of share-based payment arrangement [line items] | |||||
Exercise Price | £ / shares | £ 1.30 | ||||
Number of options/warrants outstanding | 500 | ||||
Number of options/warrants exercisable | 14 |
SHARE OPTIONS AND WARRANTS (D_2
SHARE OPTIONS AND WARRANTS (Details - options and warrants number and exercise price) Unit_Standard_pure_iZslO8HNb0uXQp9NAErPAA in Thousands, EquityInstruments in Thousands | 12 Months Ended | |||
Dec. 31, 2021£ / shares | Dec. 31, 2021EquityInstruments | Dec. 31, 2021 | Dec. 31, 2020EquityInstruments£ / shares | |
SHARE OPTIONS AND WARRANTS | ||||
Outstanding at the beginning | EquityInstruments | 41,776 | 45,037 | ||
Granted | EquityInstruments | 10,698 | 11,400 | ||
Exercised | EquityInstruments | (34,351) | (9,686) | ||
Lapsed | EquityInstruments | (434) | (4,975) | ||
Outstanding at the end | 17,689 | 17,689 | 41,776 | |
Exercisable at the end | 7,596 | 8,389 | 34,439 | |
Outstanding at the beginning (in dollars per share) | £ 0.14 | |||
Granted (in dollars per share) | £ 1.63 | 0.07 | ||
Exercised (in dollars per share) | 0.12 | 0.16 | ||
Lapsed (in dollars per share) | 0.95 | 0.16 | ||
Outstanding at the end (in dollars per share) | 0.81 | |||
Exercisable at the end (in dollars per share) | £ 0.26 | £ 0.13 |
SHARE OPTIONS AND WARRANTS (D_3
SHARE OPTIONS AND WARRANTS (Details - narratives) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
SHARE OPTIONS AND WARRANTS | ||
Weighted average remaining contractual life of options and warrants | 102 months | 29 months |
Estimated percentage of exercisable shares on enlarged share capital | 2.00% | 11.00% |
SHARE OPTIONS AND WARRANTS (D_4
SHARE OPTIONS AND WARRANTS (Details - valuation of options and warrants) | 12 Months Ended |
Dec. 31, 2021Y£ / shares | |
Options with grant date 25 July 2018 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 0.08 |
Exercise price | £ 0.16 |
Volatility | 40.00% |
Life | Y | 6 |
Risk Free interest rate | 0.01% |
Marketability discount | 75.00% |
Options with grant date 17 July 2019 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 0.09 |
Exercise price | £ 0.16 |
Volatility | 40.00% |
Life | Y | 6 |
Risk Free interest rate | 0.01% |
Marketability discount | 90.00% |
Options with grant date 5 February 2020 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 0.07 |
Exercise price | £ 0.07 |
Volatility | 40.00% |
Life | Y | 6 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Warrants with grant date 15 January 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.07 |
Exercise price | £ 1.25 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Warrants with grant date 19 January 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 0.94 |
Exercise price | £ 0.87 |
Volatility | 112.00% |
Life | Y | 5 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Options with grant date 3 February 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 0.94 |
Exercise price | £ 0.94 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Warrants with grant date 19 April 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.35 |
Exercise price | £ 1.35 |
Volatility | 112.00% |
Life | Y | 3 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Warrants with grant date 17 June 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.35 |
Exercise price | £ 1.50 |
Volatility | 112.00% |
Life | Y | 3 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Options with grant date 24 June 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.26 |
Exercise price | £ 1.26 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Options with grant date 27 June 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.35 |
Exercise price | £ 1.35 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Options with grant date 1 July 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.23 |
Exercise price | £ 1.16 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Options with grant date 13 July 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1 |
Exercise price | £ 1 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Options with grant date 22 September 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.57 |
Exercise price | £ 1.57 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
Options with grant date 23 November 2021 | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Grant date share price | £ 1.30 |
Exercise price | £ 1.30 |
Volatility | 112.00% |
Life | Y | 10 |
Risk Free interest rate | 0.01% |
Marketability discount | 0.00% |
COMMON STOCK (Details)
COMMON STOCK (Details) - GBP (£) £ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of classes of share capital [line items] | ||
Balance at the beginning | £ 24,327 | £ 20,738 |
Issued in the period | 151,141 | |
Issue costs of common stock | (12,936) | |
Fully paid not yet issued | 1,550 | |
Balance at the end | 201,810 | 24,327 |
Common Stock | ||
Disclosure of classes of share capital [line items] | ||
Balance at the beginning | 304 | 294 |
Issued in the period | 164 | |
Fully paid not yet issued | 10 | |
Balance at the end | 468 | 304 |
Share premium. | ||
Disclosure of classes of share capital [line items] | ||
Balance at the beginning | 1,540 | 25,252 |
Cancelled during the period | (25,252) | |
Issued in the period | 150,977 | |
Issue costs of common stock | (12,936) | |
Fully paid not yet issued | 1,540 | |
Balance at the end | 139,581 | 1,540 |
Common stock | Common Stock | ||
Disclosure of classes of share capital [line items] | ||
Balance at the beginning | 303 | 294 |
Issued in the period | 165 | |
Fully paid not yet issued | 9 | |
Balance at the end | £ 468 | £ 303 |
COMMON STOCK - Textual informat
COMMON STOCK - Textual information (Details) - Common Stock - £ / shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Number of shares issued [abstract] | ||
Par value per share | £ 0.001 | £ 0.001 |
Common stock | ||
Number of shares issued [abstract] | ||
Issued and fully paid (in shares) | 303,435,997 | |
Issued in the period (in shares) | 164,646,338 | |
Total number of shares issued (in shares) | 468,082,335 | |
Par value per share | £ 0.001 |
TRADE AND OTHER PAYABLES (Detai
TRADE AND OTHER PAYABLES (Details) - GBP (£) £ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
TRADE AND OTHER PAYABLES | ||
Trade payables | £ 10,259 | £ 548 |
Accruals and other payables | 4,986 | 271 |
Short term loans | 22,239 | 116 |
Other taxation and social security | 1 | |
Total trade and other creditors | £ 15,245 | £ 936 |
TRADE AND OTHER PAYABLES - Text
TRADE AND OTHER PAYABLES - Textual information (Details) - GBP (£) shares in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Trade And Other Payables [line Items] | ||
Amount due not yet received | £ 7,194,000 | £ 0 |
Gain or loss of contingent consideration | 236,000 | |
Gain of derecognized | £ 352,000 | |
DPN LLC Inc | ||
Trade And Other Payables [line Items] | ||
Variable consideration (in shares) | 8.6 |
LOANS AND BORROWINGS (Details)
LOANS AND BORROWINGS (Details) - GBP (£) £ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of detailed information about borrowings [line items] | ||
Loans and borrowing | £ 30,299 | |
Current borrowings and current portion of non-current borrowings [abstract] | ||
Short term loans | 22,239 | £ 116 |
Loans and borrowings | 23,391 | |
Total | 23,391 | |
Assumed mortgage on acquisition | ||
Disclosure of detailed information about borrowings [line items] | ||
Loans and borrowing | 3,391 | |
Current borrowings and current portion of non-current borrowings [abstract] | ||
Loans and borrowings | 1,152 | |
Bond | ||
Disclosure of detailed information about borrowings [line items] | ||
Loans and borrowing | £ 26,908 |
LOANS AND BORROWINGS - Textual
LOANS AND BORROWINGS - Textual information (Details) £ in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | ||
Nov. 30, 2021 | Dec. 31, 2021 | Dec. 23, 2021USD ($) | Dec. 23, 2021GBP (£) | |
Disclosure of detailed information about borrowings [line items] | ||||
Borrowings term | 5 years | |||
Interest rate | 8.75% | |||
Percentage of principal amount, plus accrued and unpaid interest | 100.50% | |||
Maturity Between 30 November 2023 and 30 November 2024 | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Percentage of principal amount, plus accrued and unpaid interest | 102.00% | |||
Maturity Between 30 November 2024 and 30 November 2025 | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Percentage of principal amount, plus accrued and unpaid interest | 101.00% | |||
Maturity on or after 30 November 2025 | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Percentage of principal amount, plus accrued and unpaid interest | 100.00% | |||
Mortgages [member] | Minimum | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Borrowings term | 15 months | |||
Interest rate | 3.00% | |||
Mortgages [member] | Maximum | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Borrowings term | 60 months | |||
Interest rate | 5.00% | |||
Loan Agreement [Member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Amount of loan facility | £ | £ 22.2 | |||
Loan Agreement [Member] | Loan commitments [member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Amount of loan facility | $ | $ 30 | |||
Short term loans | Loan commitments [member] | ||||
Disclosure of detailed information about borrowings [line items] | ||||
Interest rate | 8.00% | 8.00% |
LEASE LIABILITIES (Details)
LEASE LIABILITIES (Details) - GBP (£) £ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
LEASE LIABILITIES | ||
Current lease liability | £ 7 | £ 3,470 |
Long term liability | £ 370 | £ 3,910 |
LEASE LIABILITIES - Additional
LEASE LIABILITIES - Additional Information (Details) $ in Millions | Nov. 20, 2020 | Dec. 31, 2021CAD ($) | Dec. 31, 2021GBP (£) |
Disclosure of quantitative information about right-of-use assets [line items] | |||
Interest rate per annum | 5.50% | 5.50% | |
Amount incurred to maintain buildings upkeep | $ | $ 1.5 | ||
Amount of interest paid on assumed mortgages | £ 114,000 | ||
Amount of interest paid on land lease liability | £ 8,000 | ||
Celsius Network | |||
Disclosure of quantitative information about right-of-use assets [line items] | |||
Interest rate per annum | 12.00% |
FINANCIAL INSTRUMENTS - Carryin
FINANCIAL INSTRUMENTS - Carrying amount of financial assets and liabilities (Details) - GBP (£) £ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Carrying Amount Of Financial Assets [Abstract] | ||
Total carrying amount of financial assets | £ 72,826 | £ 3,589 |
Carrying Amount Of Financial Liabilities [Abstract] | ||
Total carrying amount of financial liabilities | 72,397 | 8,073 |
Trade and other payables. | ||
Carrying Amount Of Financial Liabilities [Abstract] | ||
Total carrying amount of financial liabilities | 10,259 | 548 |
Fair value of variable consideration | ||
Carrying Amount Of Financial Liabilities [Abstract] | ||
Total carrying amount of financial liabilities | 8,071 | |
Short term loans | ||
Carrying Amount Of Financial Liabilities [Abstract] | ||
Total carrying amount of financial liabilities | 23,391 | 116 |
Long term loans | ||
Carrying Amount Of Financial Liabilities [Abstract] | ||
Total carrying amount of financial liabilities | 3,391 | |
Issued debt | ||
Carrying Amount Of Financial Liabilities [Abstract] | ||
Total carrying amount of financial liabilities | 26,908 | |
Lease liabilities | ||
Carrying Amount Of Financial Liabilities [Abstract] | ||
Total carrying amount of financial liabilities | 377 | 7,409 |
Mining equipment prepayments | ||
Carrying Amount Of Financial Assets [Abstract] | ||
Total carrying amount of financial assets | 47,426 | |
Trade and other receivables | ||
Carrying Amount Of Financial Assets [Abstract] | ||
Total carrying amount of financial assets | 13,194 | 145 |
Cash and cash equivalents. | ||
Carrying Amount Of Financial Assets [Abstract] | ||
Total carrying amount of financial assets | 11,803 | 2,051 |
Financial assets at fair value, class [Member] | ||
Carrying Amount Of Financial Assets [Abstract] | ||
Total carrying amount of financial assets | £ 403 | £ 1,393 |
FINANCIAL INSTRUMENTS - Assets
FINANCIAL INSTRUMENTS - Assets and liabilities that are measured at fair value (Details) - GBP (£) £ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | £ 81,161 | £ 6,030 |
Financial Liabilities At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial liabilities at fair value through profit or loss | 8,071 | |
Level 1 of fair value hierarchy [member] | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | 329 | |
Level 2 of fair value hierarchy [member] | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | 80,759 | 4,637 |
Level 3 of fair value hierarchy [member] | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | 73 | 1,393 |
Financial Liabilities At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial liabilities at fair value through profit or loss | 8,071 | |
Deferred variable consideration | ||
Financial Liabilities At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial liabilities at fair value through profit or loss | 8,071 | |
Deferred variable consideration | Level 3 of fair value hierarchy [member] | ||
Financial Liabilities At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial liabilities at fair value through profit or loss | 8,071 | |
Equity holdings | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | 402 | 1,393 |
Equity holdings | Level 1 of fair value hierarchy [member] | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | 329 | |
Equity holdings | Level 3 of fair value hierarchy [member] | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | 73 | 1,393 |
Digital assets | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | 80,759 | 4,637 |
Digital assets | Level 2 of fair value hierarchy [member] | ||
Financial Assets At Fair Value Through Profit Or Loss [Abstract] | ||
Total financial assets at fair value through profit or loss | £ 80,759 | £ 4,637 |
FINANCIAL INSTRUMENTS - Textual
FINANCIAL INSTRUMENTS - Textual information (Details) | 12 Months Ended |
Dec. 31, 2021GBP (£) | |
FINANCIAL INSTRUMENTS | |
Transfers out of Level 1 into Level 2 of fair value hierarchy, assets held at end of reporting period | £ 0 |
Transfers out of Level 2 into Level 1 of fair value hierarchy, assets held at end of reporting period | 0 |
Transfers out of Level 1 into Level 2 of fair value hierarchy, liabilities held at end of reporting period | 0 |
Transfers out of Level 2 into Level 1 of fair value hierarchy, liabilities held at end of reporting period | 0 |
Transfers into Level 3 of fair value hierarchy, assets | 0 |
Transfers out of Level 3 of fair value hierarchy, assets | 0 |
Transfers out of Level 3 of fair value hierarchy, liabilities | £ 0 |
COMMITMENTS (Details)
COMMITMENTS (Details) | Dec. 31, 2021GBP (£) |
COMMITMENTS | |
Amount of contractual commitments | £ 9,639,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | Feb. 03, 2021GBP (£)item | Jun. 30, 2021 | Dec. 31, 2021GBP (£) | Dec. 31, 2020GBP (£) | Mar. 08, 2021GBP (£) | Dec. 31, 2019GBP (£) |
Disclosure of transactions between related parties [line items] | ||||||
Key management personnel compensation paid | £ 1,416,000 | £ 552,000 | ||||
Remuneration paid | 455,000 | 251,000 | ||||
Fair value of Polkadot tokens satisfied in respect of the acquisition of shares in Pluto Digital PLC | 13,817,000 | £ 0 | £ 0 | |||
Matthew Shaw [Member] | ||||||
Disclosure of transactions between related parties [line items] | ||||||
Key management personnel compensation paid | 36,769 | |||||
Peter Wall [Member] | ||||||
Disclosure of transactions between related parties [line items] | ||||||
Key management personnel compensation paid | 442,808 | |||||
Outstanding balance | 123,711 | |||||
Ian MacLeod [Member] | ||||||
Disclosure of transactions between related parties [line items] | ||||||
Remuneration paid | 209,100 | |||||
Alex Appleton [Member] | ||||||
Disclosure of transactions between related parties [line items] | ||||||
Key management personnel compensation paid | 215,844 | |||||
Outstanding balance | £ 92,515 | |||||
Associates [member] | ||||||
Disclosure of transactions between related parties [line items] | ||||||
Number of Polkadot tokens satisfied in respect of the acquisition of shares in Pluto Digital PLC | item | 75,000 | |||||
Fair value of Polkadot tokens satisfied in respect of the acquisition of shares in Pluto Digital PLC | £ 1,091,850 | £ 7,352,970 | ||||
% of ownership interest | 24.65% | 24.65% | 0.00% | |||
Percentage of voting rights | 24.65% | |||||
Outstanding balance | £ 0 |
POST BALANCE SHEET EVENTS (Deta
POST BALANCE SHEET EVENTS (Details) | Jan. 07, 2022W | Mar. 31, 2022Witem | Jan. 31, 2022 | Dec. 31, 2021 |
Disclosure of non-adjusting events after reporting period [line items] | ||||
Allocation of crypto assets (as percent) | 10.00% | |||
Construction flagship cryptocurrency mining facility in Mega Watts | 200 | |||
Transformers provide additional Mega Watts of total power to facility | 600 | |||
Allocation of crypto assets to Argo Labs | ||||
Disclosure of non-adjusting events after reporting period [line items] | ||||
Allocation of crypto assets (as percent) | 10.00% | |||
Number of additional main power transformers ordered | item | 4 |