Generating Cash From Mining Operations
NON-IFRS PERFORMANCE MEASURES
This presentation makes reference to certain measures that are not recognized under IFRS and do
not have a standardized meaning prescribed by IFRS. They are therefore unlikely to be comparable
to similar measures presented by other companies. The Company uses non-IFRS measures including
"EBITDA," "EBITDA margin," "Adjusted EBITDA," "Adjusted EBITDA margin," "Gross mining profit,"
and "Gross mining margin" as additional information to complement IFRS measures by providing
further understanding of the Company's results of operations from management's perspective.
EBITDA and EBITDA margin are common measures used to assess profitability before the impact of
different financing methods, income taxes, depreciation of capital assets and amortization of
intangible assets. Adjusted EBITDA and Adjusted EBITDA margin are measures used to assess
profitability before the impact of all of the items in calculating EBITDA in addition to certain other
non-cash expenses. Gross mining profit and Gross mining margin are measures used to assess
profitability after power costs in cryptocurrency production, the largest variable expense in
mining. Management uses non-IFRS measures in order to facilitate operating performance
comparisons from period to period and to prepare annual operating budgets.
"EBITDA" is defined as net income (loss) before:
•
Interest expense
•
Income tax expense
Depreciation and amortization
"EBITDA margin" is defined as the percentage obtained when dividing EBITDA by
Revenue. "Adjusted EBITDA" is defined as EBITDA adjusted to exclude:
Share-based compensation
•
Non-cash finance expenses
Asset impairment charges
•
•
Foreign currency translation adjustment
Other non-cash expenses
"Adjusted EBITDA margin" is defined as the percentage obtained when dividing Adjusted EBITDA by
Revenue. "Gross mining profit" is defined as Gross profit excluding depreciation and amortization
and other minor items included in cost of sales that do not directly relate to mining related activities.
"Gross mining margin" is defined as the percentage obtained when dividing Gross mining profit by
Revenues from mining related activities.
These measures are provided as additional information to complement IFRS measures by providing
further understanding of the Company's results of operations from management's perspective.
Accordingly, they should not be considered in isolation nor as a substitute for analysis of the
Company's financial information reported under IFRS.
Bitfarms
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