Soluna Holdings, Inc. · NASDAQ:SLNH
Soluna — Corporate Update (May 2022)
60 slides from Soluna's corporate update, May 2022
Slide 1: April 2022 Flash
HOLDINGS COMPUTING April 2022 Flash May 2022 1
Slide 2: Preamble
Preamble The following discussion is completely qualified by the legal disclosures on the several pages following this one Our goal is to share with you some of our strategic thinking and financial analysis we are using to guide the growth of our business The discussion is in line with our principle
Slide 3: Legal Disclosure & Disclaimer
Legal Disclosure & Disclaimer This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act that reflect our current views with respect to, among other things, our operations, business strategy, interpretation of prior development activities
Slide 4: Legal Disclosure & Disclaimer
Legal Disclosure & Disclaimer The material in this presentation has been prepared by Soluna and is general background information about Soluna’s activities, current as at the date of this presentation and is provided for information purposes only. It should be read in conjunction with Soluna’s perio
Slide 5: Legal Disclosure & Disclaimer
Legal Disclosure & Disclaimer Use of Projections and Illustrations This presentation contains certain financial forecasts and illustrations. Neither Soluna’s [nor Soluna Holdings] independent auditors have studied, reviewed, compiled or performed any procedures with respect to the projections for th
Slide 6: Key Operating Principles
Key Operating Principles (1) Calculated as a percent of total undiluted shares 6
Slide 7: We buy curtailed energy from renewable power
We buy curtailed energy from renewable power plants and convert it to clean, low-cost global computing. Batch-oriented Excess energy from Computing renewable sources like cryptocurrency mining 7 7
Slide 8: The $10B opportunity beyond crypto is $40B
The $10B Digital currencies opportunity $5B beyond Pharma research crypto is $40B Batchable Graphics/video processing Computing $40B Scientific research 8
Slide 9: Agenda
Agenda In this presentation, we will be covering the following items: Business Update Q1 2022 and April 2022 results in detail 9
Slide 10: Business Update
Business Update 10
Slide 11: Business Summary
Business Summary April was the best month in Soluna’s history o Compared to March, April Cash Contribution dollars increased by 38%* o Proprietary mining revenue grew sequentially by 10%, hashrate by 15%, and BTC equivalent generated by 11% Drivers to margin growth o Sophie and Marie facilities cont
Slide 12: Overview of Spring Lane Financing
Overview of Spring Lane Financing Recently closed a $35 million project financing committed with Spring Lane Ventures This is the first of several we expect to close this year Provides us an opportunity to monetize our intellectual property o Once we return capital and hurdle rate, Soluna keeps a si
Slide 13: Why is Spring Lane Financing Important
Why is Spring Lane Financing Important Provides structural template for additional deals Spring Lane is a well-known green infrastructure investor They conducted diligence of the entire set of investment opportunities and concluded: o Our projects are one of the few real green data centers. Project
Slide 14: Capital Expenditures
Capital Expenditures Dynamic crypto ecosystem drives about $100 million capital expenditure budget decrease since January Capital expenditure revised from about $300 million to ~$180-$210 million As crypto prices have declined, so have equipment prices 20% 28% 33% 76% 65% 59% Jan 2022* Current Compu
Slide 15: Vigilant Capital Raise
Vigilant Capital Raise Actively engaged with capital providers discussing potential terms Expect steady set of capital raising announcements through the second and third quarter Usually biased against disclosing term sheets and LOIs We consider from time-to-time various financing options, including
Slide 16: Comment On Recent Market Environment
Comment On Recent Market Environment Is high or low BTC good or bad for Soluna? First order effect: Since we have not yet spent the bulk of our capital on equipment, BTC prices of $25k-$35k provide an excellent opportunity to acquire equipment at reasonable prices In the optimal scenario, prices wil
Slide 17: Our Targets For 2022
Our Targets For 2022 Our Energized Capacity Ramps Over 150 MW Our Hashrate Scales Over 3 EH ✓w ✓w Note: 2022 Earnings Power Illustration released on January 19th, 2022. Not updated since original publication. Press release and presentation can be viewed here. 17
Slide 18: Driving to 1.261 EH/s by End of June
Driving to 1.261 EH/s by End of June 62% Proprietary hashrate growth expected from April to May* ~147 PH/s on the ground to be installed over the upcoming weeks Consolidated Hashrate (SHA-256, PH/s) 2,001 ~147 PH/s on the ground 983 PH/s installed as of 1,261 1,268 1,130 May 8th, 2022 147 528 696 71
Slide 19: Facility Results Review
Facility Results Review We will review each facility Then look at the consolidated results 19
Slide 20: Edith
Edith Continue to optimize equipment mix at mature facility Cash Contribution Margin (Non-GAAP) at $127 thousand for April o BTC equivalent mined increased by 7% from 4.31 in March to 4.60 in April o Average Hashrate and MW deployed increased a bit due to optimizing mix of coins mined As of May 8th,
Slide 21: Edith: Strong Return On Capital Investment
Edith: Strong Return On Capital Investment EBITDA Contribution CapEx Cumulative CF ~22 months 3x Capital ~16 months $2,845 Anticipated $2,709 2x Capital $2,573 Achieved $2,437 $2,283 $2,129 All Capital $1,975 Returned $1,805 $1,636 $1,467 $945 $666 $707 $579 $570 $310 $193 $190 $190 $190 $175 $175 $
Slide 22: Edith: Non-GAAP Historical Financials
Edith: Non-GAAP Historical Financials ($ in 000s) (Unaudited) Actual Actual Actual Actual Actual Actual Estimate Estimate Q1 21 Q2 21 Q3 21 Oct 21 Nov 21 Dec 21 Q4 21 FY 21 Jan 22 Feb 22 Mar 22 Q1 22 Apr 22 YTD 22 Revenue 891 988 905 324 317 222 864 3,648 150 185 181 517 191 707 Electricity/Direct C
Slide 23: Sophie
Sophie Ramped to 371.7 PH/s as of May 8th, 2022 o A 70% increase from the average hashrate of 226.6 PH/s in March o Significant ramp up of installed machines continues, ~147 PH / s on ground to be installed in the next few weeks Cash Contribution Margins (Non-GAAP) in April increased 59%, reaching $
Slide 24: Sophie: Non-GAAP Historical Financials
Sophie: Non-GAAP Historical Financials ($ in 000s) (Unaudited) Actual Actual Actual Estimate Estimate Oct 21 Nov 21 Dec 21 Q4 21 FY 21 Jan 22 Feb 22 Mar 22 Q1 22 Apr 22 YTD 22 Revenue 543 1,048 1,181 2,772 2,772 1,294 1,132 1,382 3,808 1,634 5,442 Electricity/Direct Costs* 284 232 369 884 884 500 53
Slide 25: Marie
Marie Prop Mining hashrate increased 37% from average 206.3 PH/s in April to 293.2 PH/s on May 8th o In May, Margins and BTC equivalent mined per day will increase proportionately In March and April, facility experienced a near complete shut down for several days due to failure of electrical infrast
Slide 26: Marie: Impact of forced shutdown
Marie: Impact of forced shutdown ($ in 000s) Marie - March (5 Days) Marie - April (8 Days) Estimate Shutdown Estimate Estimate Shutdown Estimate Mar 22 Impact* Pro-Forma Mar 22 Impact* Pro-Forma Revenue (Non-GAAP) $1,637 $319 $1,956 $1,567 $531 $2,098 Prop Mining 1,191 249 1,440 1,192 430 1,621 Host
Slide 27: Marie: Non-GAAP Historical Financials
Marie: Non-GAAP Historical Financials(A) ($ in 000s) (Unaudited) Actual Actual Actual Actual Actual Estimate Estimate Q2 21 Q3 21 Oct 21 Nov 21 Dec 21 Q4 21 FY 21 Jan 22 Feb 22 Mar 22 Q1 22 Apr 22 YTD 22 Revenue (Non-GAAP) $668 $1,463 $1,274 $1,267 $1,813 $4,354 $6,589 $1,533 $1,770 $1,637 $4,940 $1
Slide 28: Marie: Operating Metrics
Marie: Operating Metrics(A) Key Operating Metrics: Q2 21(1) Q3 21(2) Oct 21 Nov 21 Dec 21 Q4 21(3) FY 21(4) Jan 22 Feb 22 Mar 22 Q1 22(5) Apr 22 YTD 22(6) Avg. MW Deployed 1.58 3.09 8.80 10.67 12.45 10.64 7.46 14.75 17.29 15.61 15.88 14.59 15.56 Prop Mining 1.58 1.76 2.50 2.59 4.32 3.14 2.16 6.95 8.
Slide 29: Site Consolidation
Site Consolidation Combined installed hashrate increased by 31% to 959.3 PH/s over average 733.5 PH/s in April Marie forced shutdown negatively impacted revenue and margins but margin impact was more than offset by reduced power costs at Sophie o Issue has been resolved and team proactively managing
Slide 30: Consolidated Soluna Computing Non-GAAP Historical Financials
Consolidated Soluna Computing Non-GAAP Historical Financials(A) ($ in 000s) (Unaudited) Actual Actual Actual Actual Actual Actual Estimate Estimate Q1 21 Q2 21 Q3 21 Oct 21 Nov 21 Dec 21 Q4 21 FY 21 Jan 22 Feb 22 Mar 22 Q1 22 Apr 22 YTD 22 Revenue (Non-GAAP) $995 $1,657 $2,368 $2,142 $2,632 $3,216 $
Slide 31: Consolidated Soluna Computing Operating Metrics
Consolidated Soluna Computing Operating Metrics(A) Key Operating Metrics: Q1 21 Q2 21(1) Q3 21(2) Oct 21 Nov 21 Dec 21 Q4 21(3) FY 21(4) Jan 22 Feb 22 Mar 22 Q1 22(5) Apr 22 YTD 22(6) Avg. MW Deployed 1.63 3.34 4.85 15.01 20.09 24.31 19.80 9.33 30.18 32.85 30.47 31.17 31.48 31.24 Prop Mining 1.63 3.
Slide 32: A Closer Look At SG&A
A Closer Look At SG&A ($ in 000s) Q1 2021 Q2 2021 Q3 2021 Q4 2021 FY 2021 Q1 2022 Selling, general & administrative expenses ("SG&A") (GAAP) $ 1,298 $ 2,503 $ 2,317 $ 4,633 $ 10,752 $ 7,255 Non-recurring cash expenses: Related to sale of Instruments business segment $ - $ - $ 51 $ 57 $ 108 $ 175 Exc
Slide 33: Appendix
Appendix 33
Slide 34: Repeated From Our Earnings Power Illustration
Repeated From Our Earnings Power Illustration(1) (in 000's) Q1-22 Q2-22 Q3-22 Q4-22 FY22 Q1-23 Scenario 1: BTC is $20,000 Total Revenue 6,528 7,450 12,062 20,104 46,145 25,393 Earnings Contribution Margin (Non-GAAP) Contribution Margin % 3,437 52.6% 3,932 52.8% 7,344 60.9% 13,372 66.5% 28,085 60.9%
Slide 35: Our data centers are named after catalyzers
Our data centers are named after catalyzers Edith Clarke was a pioneer in electrical engineering & power transmission. She Renamed to was a first in so many ways. The first woman to earn an MSc degree at MIT in 1919. The first woman employed as an electrical engineer at General Electric in 1921. The
Slide 36: Consolidated Non-GAAP Historical Financials With Legacy Hosting
Consolidated Soluna Computing Non-GAAP Historical Financials With Legacy Hosting ($ in 000s) (Unaudited) Actual Actual Actual Actual Actual Actual Estimate Estimate Q1 21 Q2 21 Q3 21 Oct 21 Nov 21 Dec 21 Q4 21 FY 21 Jan 22 Feb 22 Mar 22 Q1 22 Apr 22 YTD 22 Revenue $995 $1,657 $3,124 $2,437 $2,811 $3
Slide 37: Consolidated Operating Metrics With Legacy Hosting
Consolidated Operating Metrics With Legacy Hosting Key Operating Metrics: Q1 21 Q2 21(1) Q3 21(2) Oct 21 Nov 21 Dec 21 Q4 21(3) FY 21(4) Jan 22 Feb 22 Mar 22 Q1 22(5) Apr 22 YTD 22(6) Avg. MW Deployed 1.63 3.34 11.09 22.21 24.61 27.36 24.73 9.79 31.44 32.85 30.47 31.59 31.48 31.56 Prop Mining 1.63 3
Slide 38: Marie: Non-GAAP Historical Financials With Legacy Hosting
Marie: Non-GAAP Historical Financials With Legacy Hosting ($ in 000s) (Unaudited) Actual Actual Actual Actual Actual Estimate Estimate Q2 21 Q3 21 Oct 21 Nov 21 Dec 21 Q4 21 FY 21 Jan 22 Feb 22 Mar 22 Q1 22 Apr 22 YTD 22 Revenue $668 $2,219 $1,569 $1,446 $1,918 $4,933 $7,925 $1,585 $1,770 $1,637 $4,
Slide 39: Reconciliation of non-GAAP results to nearest comparable GAAP measures
Reconciliation of non-GAAP results of operations to the nearest comparable GAAP measures 39
Slide 40: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue YTD April 2022 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $707 $6,558 $5,442 $0 $12,708 less Legacy Hosting Revenue 0 52 0 0 52 Revenue (Non-GAAP) $7
Slide 41: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) YTD April 2022 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $707 $6,558 $5,442 $0 $12,708 Cost of cryptocurrency r
Slide 42: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin (Non-GAAP) YTD April 2022 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $707 $6,558 $5,442 $0 $12,708 Cost
Slide 43: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue Q1 2022 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $517 $4,991 $3,808 $0 $9,316 less Legacy Hosting Revenue 0 52 0 0 52 Revenue (Non-GAAP) $517 $4,94
Slide 44: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q1 2022 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $517 $4,991 $3,808 $0 $9,316 Cost of cryptocurrency revenue (
Slide 45: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin Q1 2022 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $517 $4,991 $3,808 $0 $9,316 Cost of cryptocurrency r
Slide 46: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue FY 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $3,648 $7,925 $2,772 $0 $14,345 less Legacy Hosting Revenue 0 1,335 0 0 1,335 Revenue (Non-GAAP) $
Slide 47: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) FY 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $3,648 $7,925 $2,772 $0 $14,345 Cost of cryptocurrency revenu
Slide 48: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin (Non-GAAP) FY 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $3,648 $7,925 $2,772 $0 $14,345 Cost of cr
Slide 49: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue Q4 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $864 $4,933 $2,772 $0 $8,569 less Legacy Hosting Revenue 0 579 0 0 579 Revenue (Non-GAAP) $864 $4,
Slide 50: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q4 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $864 $4,933 $2,772 $0 $8,569 Cost of cryptocurrency revenue (
Slide 51: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin (Non-GAAP) Q4 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $864 $4,933 $2,772 $0 $8,569 Cost of crypt
Slide 52: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue Q3 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate Consolidated Product revenue (GAAP) $0 $0 $0 $0 $0 $1,949 $0 $1,949 Cryptocurrency revenue (GAAP) $905 $2,219 $0
Slide 53: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q3 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate Consolidated Product revenue (GAAP) $0 $0 $0 $0 $0 $1,949 $0 $1,949 Cryptocu
Slide 54: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin (Non-GAAP) Q3 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate Consolidated Product revenue (GAAP) $0 $0 $0 $0 $0 $1,949
Slide 55: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q2 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate Consolidated Product revenue (GAAP) $0 $0 $0 $0 $0 $1,647 $0 $1,647 Cryptocu
Slide 56: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin (Non-GAAP) Q2 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate Consolidated Product revenue (GAAP) $0 $0 $0 $0 $0 $1,647 $0 $1,647 Cryptocurrency r
Slide 57: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q1 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate Consolidated Product revenue (GAAP) $0 $0 $0 $0 $0 $1,337 $0 $1,337 Cryptocu
Slide 58: Reconciliation Of Non-GAAP Results
Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin (Non-GAAP) Q1 2021 ($ in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate Consolidated Product revenue (GAAP) $0 $0 $0 $0 $0 $1,337 $0 $1,337 Cryptocurrency r
Slide 59: The future of renewable energy is computing.
The future of renewable energy is computing. 59
Slide 60: Learn more at solunacomputing.com
Learn more at solunacomputing.com 60