Full Year Financial Highlights
- GAAP revenue – MFH generated total revenue on a consolidated basis in the amounts of
$863,438 for the year endedDecember 31, 2022 , and$670,171 for the year endedDecember 31, 2021 . The increased revenue comes from the cryptocurrency mining business and expansion of consultation services. - GAAP operating expenses – MFH’s total operating expenses decreased significantly from
$13,273,814 for the year endedDecember 31, 2021 , to$5,368,222 for the year endedDecember 31, 2022 . The narrowing expenses comes from the adoption of new business strategy, efficiency of the management and operation, optimizing of the compensation structure etc. - GAAP net loss – MFH’s net loss decreased significantly from
US$21,665,704 for the year endedDecember 31, 2021 , toUS$5,634,971 for the year endedDecember 31, 2022 . - GAAP gross profit – MFH’s gross profit increased from
$32,508 for the year endedDecember 31, 2021 , to$517,162 for the year endedDecember 31, 2022 . - As of
December 31, 2022 , the Company held 125.8584797 Bitcoins with a book value of$5,972,282 ;2,005,537.50 USD Coins with a book value of$2,003,332 ; and 104762.0706 Filecoins with a book value of$315,376 .
Full Year Business Highlights
Improved Company liquidity and funding conditions to support operations and growth. The successful completion of three rounds of financing in the fiscal year of 2022, totaling$13.15 million , demonstrated investor confidence in the Company's prospects. These funds will be used to accelerate the Company's growth plans and further solidify its position as a leader in the cryptocurrency mining and distributed computing space.- Expanded business lines. The Company diversified its business in the second half of 2022 and made significant progress in expanding its operations. The Company's future business plan includes three main areas: distributed computing and storage services business, digital consultation services, and blockchain technical services business. On
July 15, 2022 , MFH incorporatedMercurity Fintech Technology Holding Inc. in theU.S. , which plans to develop distributed computing and storage services and digital consultation services. - Position for the long-term growth with cryptocurrency mining machines and web3 infrastructure. The Company's strategic investments in state-of-the-art cryptocurrency mining machines and web3 infrastructure building technology are made with an aim to own mining machines capable of gathering, processing, and storing vast amounts of data, and to further solidify the Company as a pioneer in the creation of the Web3 framework.
- Dismantling of the VIE structure and shifting toward a global structure headquartered in
the United States . This progress enables the Company to better navigate regulatory challenges in the cryptocurrency and blockchain industry and tap into a broader range of potential customers and partners. Furthermore, the move enhances the Company's reputation and credibility as a serious player in the industry and is likely to attract more investors, partners, and customers. - A diversified board structure and expertise. MFH announced appointment of new directors to the board, the new board brings a wider range of perspectives, experiences, and expertise to the table. This can lead to better decision-making, improved risk management, and the ability to capitalize on new opportunities.
Mr.
Full Year Financial Results
For the Year Ended
Revenue: MFH generated total revenue on a consolidated basis in the amounts of
Cost of Revenue: MFH generated total cost of revenue on a consolidated basis in the amounts of
Operating expenses: MFH’s operating expenses consist of sales and marketing expenses, general and administrative expenses, provision for doubtful accounts, (loss)/income on disposal of intangible assets and impairment loss of intangible assets. MFH’s total operating expenses were
Loss from disposal of subsidiaries: Due to the extremely adverse regulatory measures taken by the Chinese government in 2021 in the field of digital currency production and transaction, the Company's board of Directors decided on
Interest Income, net: MFH’s interest income consists primarily of the interest income from MFH’s cash and short-term deposits with banks and compensation received for payments MFH made on behalf of the divested business. MFH generated
Other Income/(expenses): Other income consists primarily of the gain generated from the government subsidies. MFH generated
Net loss: MFH’s net loss was
Full Year Operation Results
In
Due to the extremely adverse regulatory measures taken by the Chinese government in 2021 in the field of digital currency production and transaction, MFH’s board of directors decided on
In late
Due to the dismantling of the VIEs and the cessation of all business related to the digital asset transaction platforms, as well as the temporary difficulties brought to us by the incident that MFH’s cryptocurrencies were out of control, the original Chinese technical team also left in the first half of 2022, and MFH failed to rebuild the technical service team in the second half of 2022. As a result, MFH’s blockchain technical services business did not generate any revenue in 2022.
In the second half of 2022, the management and board of the Company changed, and the future business plan was recalibrated as a result. The Company's business will include: 1) Distributed computing and storage services business, including cryptocurrency mining and distributed computing and storage services for more other applications; 2) Digital consultation services, providing digital payment solutions, asset management, and a continued expansion into online and traditional brokerage services; 3) Blockchain technical service businesses, providing the designing and developing of digital asset transaction platforms, digital asset quantitative investment software and other innovative and derivative services based on blockchain technologies.
On
On
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About
Forward-Looking Statements
This announcement contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results.
For more information, please contact:
International Elite Capital Inc.
Vicky Chueng
Tel: +1(646) 866-7989
Email: mfhfintech@iecapitalusa.com
FORMERLY KNOWN AS JMU LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN
For the year Ended | ||||||||||||||
Note | 2022 | 2021 | 2020 | |||||||||||
( as restated ) | ( as restated ) | |||||||||||||
Revenue: | ||||||||||||||
Technical services | — | 5,864 | 1,402,300 | |||||||||||
Cryptocurrency mining | 783,438 | 664,307 | — | |||||||||||
Consultation services | 80,000 | — | — | |||||||||||
Total Revenue | $ | 863,438 | $ | 670,171 | $ | 1,402,300 | ||||||||
Cost of Revenue: | ||||||||||||||
Technical services | — | — | (79,150 | ) | ||||||||||
Cryptocurrency mining | (1,361,600 | ) | (702,679 | ) | — | |||||||||
Consultation services | (19,000 | ) | — | — | ||||||||||
Total Cost of Revenue | $ | (1,380,600 | ) | $ | (702,679 | ) | $ | (79,150 | ) | |||||
Gross profit | $ | (517,162 | ) | $ | (32,508 | ) | $ | 1,323,150 | ||||||
Operating expenses: | ||||||||||||||
Sales and marketing | (35,000 | ) | — | — | ||||||||||
General and administrative | (2,156,063 | ) | (10,351,357 | ) | (1,156,574 | ) | ||||||||
Provision for doubtful accounts | (3,138 | ) | (1,750,909 | ) | — | |||||||||
(Loss)/income on disposal of intangible assets | (29,968 | ) | 121,020 | — | ||||||||||
Impairment loss of intangible assets | 9 | (3,144,053 | ) | (1,292,568 | ) | (835,344 | ) | |||||||
Impairment loss of goodwill | — | — | — | |||||||||||
Total operating expenses | $ | (5,368,222 | ) | $ | (13,273,814 | ) | $ | (1,991,918 | ) | |||||
Operating loss from continuing operations | $ | (5,885,384 | ) | $ | (13,306,322 | ) | $ | (668,768 | ) | |||||
Interest income, net | 5,118 | 1,083 | 7,983 | |||||||||||
Other income/(expenses), net | 1,248 | (143 | ) | (32,533 | ) | |||||||||
Loss from disposal of subsidiaries | 1 | (4,664 | ) | — | — | |||||||||
Loss before provision for income taxes | $ | (5,883,682 | ) | $ | (13,305,382 | ) | $ | (693,318 | ) | |||||
Income tax benefits | 11 | 248,711 | — | — | ||||||||||
Loss from continuing operations | $ | (5,634,971 | ) | $ | (13,305,382 | ) | $ | (693,318 | ) | |||||
Discontinued operations: | ||||||||||||||
Loss from discontinued operations | 1 | — | (8,360,322 | ) | (957,955 | ) | ||||||||
Net loss | $ | (5,634,971 | ) | $ | (21,665,704 | ) | $ | (1,651,273 | ) | |||||
Net loss attributable to holders of ordinary shares of | $ | (5,634,971 | ) | $ | (21,665,704 | ) | $ | (1,651,273 | ) |
FORMERLY KNOWN AS JMU LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)
(In
For the year Ended | ||||||||||||||
Note | 2022 | 2021 | 2020 | |||||||||||
( as restated ) | ( as restated ) | |||||||||||||
Numerator | ||||||||||||||
Net loss attributable to holders of ordinary shares of | $ | (5,634,971 | ) | $ | (21,665,704 | ) | $ | (1,651,273 | ) | |||||
Continuing operations | (5,634,971 | ) | (13,305,382 | ) | (693,318 | ) | ||||||||
Discontinued operations | — | (8,360,322 | ) | (957,955 | ) | |||||||||
Denominator | ||||||||||||||
Weighted average shares used in calculating basic net loss per ordinary share | 2 | 14,435,674 | 9,720,934 | 6,689,704 | ||||||||||
Weighted average shares used in calculating diluted net loss per ordinary share | 2 | 14,435,674 | 9,720,934 | 6,689,704 | ||||||||||
Net Loss per ordinary share | ||||||||||||||
Basic | 2 | (0.39 | ) | (2.23 | ) | (0.25 | ) | |||||||
Diluted | 2 | (0.39 | ) | (2.23 | ) | (0.25 | ) | |||||||
Net Loss per ordinary share from continuing operation | ||||||||||||||
Basic | 2 | (0.39 | ) | (1.37 | ) | (0.10 | ) | |||||||
Diluted | 2 | (0.39 | ) | (1.37 | ) | (0.10 | ) | |||||||
Net Loss per ordinary share from discontinued operation | ||||||||||||||
Basic | 2 | — | (0.86 | ) | (0.14 | ) | ||||||||
Diluted | 2 | — | (0.86 | ) | (0.14 | ) |
FORMERLY KNOWN AS JMU LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)
(In
For the year Ended | ||||||||||||||
Note | 2022 | 2021 | 2020 | |||||||||||
( as restated ) | ( as restated ) | |||||||||||||
Net loss | $ | (5,634,971 | ) | $ | (21,665,704 | ) | $ | (1,651,273 | ) | |||||
Change in cumulative foreign currency trans adjustment | 28,289 | 3,285 | 45,396 | |||||||||||
Comprehensive loss | $ | (5,606,682 | ) | $ | (21,662,419 | ) | $ | (1,605,877 | ) |
FORMERLY KNOWN AS JMU LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In
For the year Ended | ||||||||||||
2022 | 2021 | 2020 | ||||||||||
( as restated ) | ( as restated ) | |||||||||||
Cash flows from operating activities: | ||||||||||||
Net loss | (5,634,971 | ) | (21,665,704 | ) | (1,651,273 | ) | ||||||
Less: Net loss from discontinued operations | — | (8,360,322 | ) | (957,955 | ) | |||||||
Net loss from continuing operations | (5,634,971 | ) | (13,305,382 | ) | (693,318 | ) | ||||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||
Provision for doubtful accounts | 3,138 | 1,750,909 | — | |||||||||
Impairment loss of intangible assets | 3,144,053 | 1,292,568 | 835,344 | |||||||||
Depreciation of fixed assets and amortization of intangible assets | 28,950 | — | — | |||||||||
Stock-based compensation | 558,395 | 8,349,862 | 286,132 | |||||||||
Loss from disposal of subsidiaries | 4,664 | — | — | |||||||||
Other income/(expenses) | 23,318 | — | — | |||||||||
Changes in operating assets and liabilities, net of effect of acquisitions: | ||||||||||||
Digital assets generated from mining business | (783,438 | ) | (664,307 | ) | — | |||||||
Digital assets received as payment | — | (5,864 | ) | (17,863 | ) | |||||||
Digital assets used to pay expenses | — | 2,141,375 | 6,924 | |||||||||
Disposal of digital assets | 998,902 | 325,987 | 647 | |||||||||
Accounts receivable, net of allowance | — | 380,510 | 835,533 | |||||||||
Prepaid expenses and other current assets | 1,281,109 | (1,105,481 | ) | (740,150 | ) | |||||||
Right-of-use assets | (873,878 | ) | — | — | ||||||||
Deferred tax assets | (251,005 | ) | — | — | ||||||||
Accounts payable | 22,075 | — | — | |||||||||
Advance from customers | 80,000 | — | — | |||||||||
Accrued expenses and other current liabilities | (87,867 | ) | (184,429 | ) | (161,626 | ) | ||||||
Lease liabilities | 904,132 | — | — | |||||||||
Net cash (used in)/provided by continuing operations | $ | (582,423 | ) | $ | (1,024,252 | ) | $ | 351,623 | ||||
Net cash used in discontinued operations | — | (386,777 | ) | (957,591 | ) | |||||||
Net cash used in operating activities | $ | (582,423 | ) | $ | (1,411,029 | ) | $ | (605,968 | ) | |||
Cash flows from investing activities: | ||||||||||||
Purchase of fixed assets | (7,222 | ) | — | — | ||||||||
Loan to affiliate person | (25,000 | ) | — | — | ||||||||
Net cash used in continuing operations | $ | (32,222 | ) | $ | — | $ | — | |||||
Net cash provided by discontinued operations | — | — | 144 | |||||||||
Net cash (used in)/provided by investing activities | $ | (32,222 | ) | $ | — | $ | 144 |
FORMERLY KNOWN AS JMU LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(In
For the year Ended | ||||||||||||
2022 | 2021 | 2020 | ||||||||||
( as restated ) | ( as restated ) | |||||||||||
Cash flows from financing activities: | ||||||||||||
Issuance of common stock | 7,900,300 | 713,082 | 300,000 | |||||||||
Borrowings | 400,000 | 935,793 | — | |||||||||
Cash paid for debt | (579,875 | ) | (93,091 | ) | — | |||||||
Net cash provided by continuing operations | $ | 7,720,425 | $ | 1,555,784 | $ | 300,000 | ||||||
Net cash provided by discontinued operations | — | 120,419 | — | |||||||||
Net cash provided by financing activities | $ | 7,720,425 | $ | 1,676,203 | $ | 300,000 | ||||||
Effect of exchange rate changes by continuing operations | (8,543 | ) | 2,953 | 43,374 | ||||||||
Effect of exchange rate changes by discontinued operations | — | 403 | 2,022 | |||||||||
Effect of exchange rate changes | $ | (8,543 | ) | $ | 3,356 | $ | 45,396 | |||||
Increase/(decrease) in cash and cash equivalents | $ | 7,097,237 | $ | 268,530 | $ | (260,428 | ) | |||||
Cash and cash equivalents, beginning of the year | $ | 440,636 | $ | 174,783 | $ | 435,211 | ||||||
Cash and cash equivalents of continuing operations, end of the year | 7,537,873 | 440,636 | 142,557 | |||||||||
Cash and cash equivalents of discontinued operations, end of the year | — | 2,677 | 32,226 | |||||||||
Cash and cash equivalents, end of the year | $ | 7,537,873 | $ | 443,313 | $ | 174,783 | ||||||
Supplement disclosure of cash flow information Interest paid | — | — | 4 |
Source:
2023 GlobeNewswire, Inc., source