via NewMediaWire -- Mechanical Technology, Incorporated ("MTI"
or the "Company"), (NASDAQ: MKTY), the parent company of MTI
Instruments, Inc. ("MTI Instruments"), a test and measurement
instruments and systems business, and EcoChain, Inc. ("EcoChain"),
a cryptocurrency mining business powered by renewable energy,
announced today its second quarter 2021 financial results and July
site level financials.
Michael Toporek, CEO of MTI, stated, "In our
EcoChain business, two themes emerged. After a solid July,
installed hashrate in August is expected to increase by 269% and in
September by 863% over July. This execution is in line with the
illustration of earnings power the Company previously provided in
May of 2021. Another positive development is the creation of a 10
MW joint venture with a global mining company where EcoChain will
host 10 MW of S19 or equivalent chips. Power and labor cost will be
covered and the joint venture, as executed, provides that EcoChain
will receive a significant revenue share. This relationship allows
the Company to hit 60% - 70% of its earnings target for 10 MW
without any capital expenditure. The recent market disruption
allowed EcoChain to change its equipment mix and purchase miner S19
or equivalent models at favorable prices. These chips are more
power dense so that when combined with the joint venture
relationship, our Python data center will now have dramatically
increased earnings power. We will deploy the same earnings power
and hashing power we were planning to in our May illustration but
on top of that will also have the revenue stream from the joint
venture.”
MTI's Chief Financial Officer, Jessica Thomas,
commented, "The strong second quarter results continue to reflect
the positive trends we are seeing in the growth of our overall
business. I am particularly pleased with our revenue as EcoChain
continues to scale and have strong results every quarter.
Revenue grew by 66% sequential increase from the first quarter, and
adjusted EBITDA contribution of $1.0 million. We are positioned
well for ongoing growth with our solid balance sheet and access to
unique growth opportunities."
Moshe Binyamin, President of MTI Instruments,
stated, "Our instruments business reported another solid quarter
with a high level of activity across almost all of our product
lines. We continue to see good interest from our customers
including the US Airforce as well as GE and others with a clear
focus on recurring revenue transactions. In particular, we are
experiencing increasing activity in our PBS product line as well as
from Semiconductor and EV battery manufacturers. We are also seeing
good interest from organizations looking to introduce sensors to
measure critical metrics and auto correct in real time with major
ongoing opportunities targeted for the remainder of this year with
a very significant addressable market ramp into 2022. With our
operational plan focused on new vertical solutions, product
innovation and OEM capabilities, we are strongly positioned for
accelerated growth.”
Second Quarter 2021 Financial
Highlights:
For the second quarter ended June 30, 2021,
revenues were $3.3 million, a 35% increase of $864
thousand compared to $2.4 million in the prior year
quarter. The increase in revenue was driven by the establishment of
the EcoChain line of business. Cryptocurrency revenue was $1.7
million, for the three months ended June 30, 2021, an increase
of $1.6 million from the prior year quarter, and a 66%
increase compared to the first quarter of 2021 of $662
thousand.
As of June 30, 2021, the Company reported
cash of $12.1 million compared to $2.7
million at March 31, 2021. During the quarter, the
Company raised approximately $15 million in gross proceeds
from its public offering of shares of the Company’s common stock
and warrants to purchase common stock.
MTI Instruments revenue
was $1.65 million for the second quarter ended June
30, 2021, which was a $743 thousand decrease compared to the
prior year Q2 results due to 17 additional PBS units shipped in
2020 under the USAF contract. MTI Instruments product cost of
sales, for the second quarter of 2021 was $502
thousand or 30% of revenue comparable to $631
thousand in the second quarter of 2020 or 26% of revenue.
EcoChain, Inc., revenue
was $1.66 million for the second quarter ended June 30,
2021, which was a $1.61 million increase compared to the
prior year Q2 results. Cost of revenue for the 2021 second quarter
was $545 thousand or 33% of revenue. Capacity
continued to ramp in the second quarter with the additional miners
at the Python site, doubling capacity from the end of first quarter
to the end of the second quarter. The improvement is due to the
Python site scaling up and TNT site reaching maturity.
The Python site location continued to invest in
miners and infrastructure in the second quarter of 2021. EcoChain
continued infrastructure improvements in its TNT location and
continues to build out its Anaconda location. EcoChain is
positioned for additional growth in 2021 towards its stated goals
of 50MW under management by the end of 2021.
As previously communicated, EcoChain remains
committed to releasing its site level financial flash report,
including revenue, adjusted cost of cryptocurrency revenue
and contribution margin.
EcoChain Key Summary Highlights for July 2021:
($ in 000s; Unaudited) |
Q1 2021 |
Q2 2021 |
July 2021 |
YTD July 2021 |
Revenue |
$995 |
$1,657 |
$493 |
$3,146 |
Contribution Margin |
$744 |
$1,261 |
$356 |
$2,361 |
|
|
|
|
|
Annualized Revenue |
$3,980 |
$6,628 |
$5,916 |
$5,393 |
Annualized Contribution Margin |
$2,976 |
$5,044 |
$4,272 |
$4,047 |
A presentation and corresponding video is available on the
Company’s website
at https://www.mechtech.com/mti-announces-quarter-two-2021-results
About MTI
MTI is the parent company of MTI Instruments,
Inc. and EcoChain, Inc. Through MTI Instruments, MTI is engaged in
the design, manufacture and sale of test and measurement
instruments and systems that use a comprehensive array of
technologies to solve complex, real world applications in numerous
industries, including manufacturing, electronics, semiconductor,
solar, commercial and military aviation, automotive and data
storage. Through EcoChain, MTI is developing cryptocurrency mining
facilities powered by renewable energy that integrate with the
blockchain network. For more information about MTI, please
visit https://www.mechtech.com.
Forward Looking Statement
This communication contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements reflect management's
current expectations, as of the date of this communication, and
involve certain risks and uncertainties. Forward-looking statements
include statements herein with respect to the successful execution
of the Company's business strategy. The Company's actual results
could differ materially from those anticipated in these
forward-looking statements as a result of various factors. Such
risks and uncertainties include, among other things, our ability to
establish and maintain the proprietary nature of our technology
through the patent process, as well as our ability to possibly
license from others patents and patent applications necessary to
develop products; the availability of financing; the Company's
ability to implement its long range business plan for various
applications of its technology; the Company's ability to enter into
agreements with any necessary partners; the impact of competition,
the obtaining and maintenance of any necessary regulatory
clearances applicable to applications of the Company's technology;
and management of growth and other risks and uncertainties that may
be detailed from time to time in the Company's reports filed with
the Securities and Exchange Commission.
Contact Information:
Lisa Brennan lbrennan@mtiinstruments.com
Investor Relations:
Kirin Smith, President PCG Advisory, Inc. 646.823.8656
Ksmith@pcgadvisory.com
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