Bitcoin miner CleanSpark (CLSK) said it will continue to look for growth through accretive acquisitions of mining assets, as the crypto winter continues to weigh on the industry.
"We don't feel compelled to go out and have to do M&A but obviously if we see a good deal we'll take advantage of that," said Chief Financial Officer Gary Vecchiarelli on his company's fiscal first-quarter earnings conference call on Thursday. He also thinks that if bitcoin's price doesn't get close to $40,000 heading into the next halving event, there will likely be a lot of smaller miners, particularly private companies that won't be able to access the capital markets, yielding potential opportunities for CleanSpark.
In the latest bear market, while more miners were reeling from the slump in bitcoin prices and higher energy costs, CleanSpark took the opportunity to buy assets and mining machines on the cheap.
"We have been thoughtful and calculated buyers in this market, seeking out accretive acquisitions and efficiently deploying capital," Vecchiarelli said in a statement on Thursday. "We have been successful in sourcing and closing transactions which not only grow our percentage of the total global hash rate, but also produce meaningful bitcoin and cash flow while still paying down what little debt we have," he added.
CleanSpark is looking to finance potential deals by selling mined bitcoins and issuing equity, management said on the earnings conference call. To that end, CEO Zach Bradford said CleanSpark will seek to raise the number of authorized shares for issuance from 100 million to 300 million at its upcoming annual meeting.
Bradford noted the move doesn't necessarily mean the company will issue any of the authorized shares, but it will give the company the option to use equity, if needed, to reach its targeted growth. "We believe the [increased] shares would provide us the flexibility to not only maintain market share, but to substantially grow market share, just as we have in the past," he said on the conference call.
Additionally, CFO Vecchiarelli said the company is looking to make accretive acquisitions and has several options to do so, including selling bitcoin and equity. "I want to emphasize that we will continue to be methodical and calculated when raising capital and deploying that capital," Vecchiarelli said.
The miner expects to reach its year-end hashrate, or computing power, guidance of 16 exahash per second (EH/s), according to an earnings statement on Thursday. CleanSpark previously adjusted its 2023 year-end hashrate view to 16 EH/s from 22.4 EH/s, citing a delay in building a mining facility by one of its partners, Lancium.
Overall, CleanSpark reported fiscal first-quarter revenue of $27.8 million versus average analyst estimate of $29.5 million, according to FactSet data. The shares of the miner were down about 4.3% in post-market trading Thursday, while bitcoin fell 4.6% over the last 24 hours.