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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 16, 2022

 

 

Greenidge Generation Holdings Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-40808	86-1746728
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
135 Rennell Drive, 3rd Floor
Fairfield, Connecticut				06890
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (203) 718-5960

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A Common Stock, $0.0001 par value		GREE		NASDAQ Global Select Market
8.50% Senior Notes due 2026		GREEL		NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

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Item 2.02 Results of Operations and Financial Condition.

On May 16, 2022, Greenidge Generation Holdings Inc. issued a press release setting forth Greenidge Generation Holdings Inc.’s financial results for the quarter ended March 31, 2022. A copy of Greenidge Generation Holding Inc.’s press release is furnished herewith as Exhibit 99.1 and is hereby incorporated by reference in this Item 2.02.

 

The information contained in this Item 2.02, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of Section 18. Furthermore, the information contained in this Item 2.02 and Exhibit 99.1 shall not be deemed to be incorporated by reference into any registration statement or other document filed pursuant to the Securities Act of 1933, as amended.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits. The following exhibit is furnished herewith pursuant to Item 2.02 hereof:

 

Exhibit No.		Description
99.1		Press Release, dated May 16, 2022
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			Greenidge Generation Holdings Inc.
Date:	May 16, 2022	By:	/s/ Jeffrey E. Kirt
			Jeffrey E. Kirt Chief Executive Officer

 

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EXHIBIT 99.1

Greenidge Generation Reports First Quarter 2022 Results and Provides April 2022 Operational Update

 

 

First Quarter 2022 Highlights

 

April 2022 Operational Update

 

Fairfield, Conn. – May 16, 2022 – Greenidge Generation Holdings Inc. (NASDAQ: GREE) (“Greenidge”), a vertically integrated cryptocurrency datacenter and power generation company, today announced financial and operating results for the first quarter of 2022 and also provided an operational update for the month of April 2022.

 

“Consistent with the estimates we released on April 21, Greenidge demonstrated another strong quarter of significant revenue growth and substantial Adjusted EBITDA generation,” said Jeff Kirt, Chief Executive Officer of Greenidge. “In addition to announcing our quarterly results today, we have begun reporting monthly operational statistics. Our April results were highlighted by production of 197 bitcoin from 1.6 EH/s of hashrate capacity as we continue to expand capacity at our South Carolina facility.”

 

First Quarter 2022 Financial Results

 

$ in thousands, except Adjusted EBITDA margin		Q1 2022						Q1 2021							Variance
Total Revenue		$	37,655						$	11,063							240.4		%
Cryptocurrency datacenter revenue		$	23,232						$	8,997							158.2		%
Power and capacity revenue		$	5,923						$	2,066							186.7		%
Adjusted EBITDA		$	9,213						$	4,221							118.3		%
Adjusted EBITDA margin			24.5		%					38.2		%

 

 

 

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Greenidge’s revenue for the first quarter was $37.7 million, up 240% compared to the prior year period. Cryptocurrency Datacenter revenue for the first quarter was $23.2 million, up 158% versus the prior year period, and Power and Capacity revenue for the first quarter was $5.9 million, up 187% compared to the prior year period. Greenidge’s Support.com subsidiary, which was acquired in September 2021, generated approximately $8.5 million in first quarter revenue and was not included in Greenidge’s first quarter 2021 results.

 

Greenidge produced approximately 561 bitcoin during the first quarter of 2022, compared to 213 bitcoin in the first quarter of 2021.

 

Net loss was $0.4 million for the first quarter as compared to net income of $1.3 million in the prior year period. The first quarter of 2022 included $2.1 million of expansion costs and $0.2 million of merger and public company filing costs. Excluding these items, Adjusted net income for the first quarter was $1.3 million, compared to Adjusted net income of $1.4 million in the first quarter of 2021.

 

Adjusted EBITDA for the first quarter was $9.2 million, or 24.5% of revenue, compared to the prior year period of $4.2 million, or 38.2% of revenue.

 

Adjusted net income, Adjusted EBITDA, Adjusted EBITDA margin and last twelve months ("LTM") Adjusted EBITDA are non-GAAP measures. See the tables attached to this press release for a reconciliation from GAAP to non-GAAP measures and Use of Non-GAAP Information below for more details

 

Greenidge ended the first quarter with approximately $98 million of cash and fair market value of cryptocurrency holdings, of which, less than $2 million was cryptocurrency holdings. Greenidge had approximately $28 million in undrawn financing commitments at the end of the first quarter, bringing Greenidge's total liquidity to approximately $126 million as of March 31, 2022. In addition, Greenidge had approximately $135 million of cash on deposit with Bitmain as of March 31, 2022.

 

Capital Discussion

 

During the first quarter, as previously disclosed, Greenidge successfully completed two non-dilutive debt financings totaling approximately $108 million in available funding, of which $81 million was funded during the quarter. Greenidge entered into a secured equipment financing that matures in April 2024 with $81 million of available capacity, of which $54 million was funded. Greenidge also entered into a fully-drawn secured promissory note for approximately $27 million that matures in July 2022, with extensions available until December 2022.

 

April 2022 Operational Update

 

During the month of April 2022, Greenidge produced approximately 197 bitcoin. As of April 30, 2022, Greenidge had approximately 1.6 EH/s of mining capacity from approximately 19,600 miners. Approximately 22% of the capacity was located at Greenidge’s facility in Spartanburg, SC which was acquired and commenced operations in December 2022.

 

 

About Greenidge Generation Holdings Inc.

Greenidge Generation Holdings Inc. (NASDAQ: GREE) is a vertically integrated cryptocurrency datacenter and power generation company. Greenidge is committed to 100% carbon-neutral datacenter operations at all of its locations by utilizing low-carbon sources of energy and offsetting its carbon footprint.

 

Use of Non-GAAP Information

To provide investors and others with additional information regarding the financial results of Greenidge (the "Company"), the Company has disclosed in this press release certain non-GAAP operating performance measures of Adjusted EBITDA, Adjusted EBITDA margin, LTM Adjusted EBITDA and Adjusted net income. Adjusted EBITDA is defined as earnings before interest, taxes and depreciation and amortization, which is then adjusted for stock-based compensation and other special items determined by management, including, but not limited to costs associated with the merger with Support.com, costs of becoming a public company (which included the costs of a corporate reorganization from an LLC, public registration of shares and associated costs), business expansion costs, impairment of goodwill and remeasurement of environmental liability. Adjusted EBITDA margin is the percentage of Adjusted EBITDA of revenue. LTM Adjusted EBITDA is Adjusted EBITDA over the last twelve-month period. Adjusted net income is net income (loss) adjusted for the after-tax impacts of special items determined by management, including but not limited to costs associated with the merger with Support.com, costs of becoming a public company (which included the costs of a corporate reorganization from an LLC, public registration of shares and associated costs), business expansion costs, impairment of goodwill and

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remeasurement of environmental liability. These non-GAAP financial measures are a supplement to and not a substitute for or superior to, the Company’s results presented in accordance with U.S. GAAP. The non-GAAP financial measures presented by the Company may be different from non-GAAP financial measures presented by other companies. Specifically, the Company believes the non-GAAP information provides useful measures to investors regarding the Company’s financial performance by excluding certain costs and expenses that the Company believes are not indicative of its core operating results. The presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for results or guidance prepared and presented in accordance with U.S. GAAP. A reconciliation of the non-GAAP financial measures to U.S. GAAP results is included herein.

 

 

Forward-Looking Statements

This press release includes certain statements that may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements for purposes of federal and state securities laws. These forward-looking statements involve uncertainties that could significantly affect Greenidge’s financial or operating results. These forward-looking statements may be identified by terms such as “anticipate,” “believe,” “continue,” “foresee,” “expect,” “intend,” “plan,” “may,” “will,” “would,” “could,” and “should,” and the negative of these terms or other similar expressions. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Forward-looking statements in this press release include, among other things, statements regarding the business plan, business strategy and operations of Greenidge in the future. In addition, all statements that address operating performance and future performance, events or developments that are expected or anticipated to occur in the future, such as statements concerning (i) the delivery of miners currently on order with Bitmain, (ii) the development of facilities in South Carolina, (iii) future mining capacity, (iv) future electrical capacity, (v) future liquidity and (vi) the ability to obtain future debt or equity financing, are forward-looking statements. Forward-looking statements are subject to a number of risks, uncertainties and assumptions. Matters and factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements include but are not limited to the matters and factors described in Part I, Item 1A. “Risk Factors” of Greenidge’s Annual Report on Form 10-K for the year ended December 31, 2021, and its other filings with the Securities and Exchange Commission, as well as statements about or relating to or otherwise affected by the completion of management’s final review of the financial results and Greenidge’s other closing procedures. Consequently, all of the forward-looking statements made in this press release are qualified by the information contained under this caption. No assurance can be given that these are all of the factors that could cause actual results to vary materially from the forward-looking statements in this press release. You should not put undue reliance on forward-looking statements. No assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do occur, the actual results, performance, or achievements of Greenidge could differ materially from the results expressed in, or implied by, any forward-looking statements. All forward-looking statements speak only as of the date of this press release and Greenidge does not assume any duty to update or revise any forward-looking statements included in this press release, whether as a result of new information, the occurrence of future events, uncertainties or otherwise, after the date of this press release.

 

 

For further information, please contact:

 

Investor Relations

investorrelations@greenidge.com

 

Media Inquiries

media@greenidge.com

 

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GREENIDGE GENERATION HOLDINGS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
Amounts denoted in 000's (except per share data)
		Three Months Ended:
		March 31, 2022				March 31, 2021					Variance
REVENUE:
Cryptocurrency datacenter		$	23,232			$	8,997					158	%
Power and capacity			5,923				2,066					187	%
Services and other			8,500				-				N/A
Total revenue			37,655				11,063					240	%
OPERATING COSTS AND EXPENSES
Cost of revenue - Cryptocurrency datacenter   (exclusive of depreciation and amortization)			8,456				2,574					229	%
Cost of revenue - Power and capacity   (exclusive of depreciation and amortization)			4,023				2,009					100	%
Cost of revenue - Services and other   (exclusive of depreciation and amortization)			4,071				-				N/A
Selling, general and administrative			14,392				3,229					346	%
Merger and other costs			213				105					103	%
Depreciation and amortization			3,978				1,261					215	%
Loss from operations			2,522				1,885					34	%
OTHER (EXPENSE) INCOME, NET:
Interest expense			(3,353	)			(188	)				1684	%
(Loss) gain on sale of digital assets			(5	)			295					-102	%
Other income, net			39				19					105	%
Total other (expense) income, net			(3,319	)			126					-2731	%
(LOSS) INCOME BEFORE INCOME TAXES			(797	)			2,011					-140	%
(Benefit) provision for income taxes			(368	)			732					-150	%
NET (LOSS) INCOME		$	(429	)		$	1,279					-134	%
Earnings per share:
Basic		$	(0.01	)		$	0.02
Diluted		$	(0.01	)		$	0.02
Reconciliation of Net (loss) income to Adjusted EBITDA
Net (loss) income		$	(429	)		$	1,279
(Benefit) provision for income taxes			(368	)			732
Interest expense, net			3,353				188
Depreciation and amortization			3,978				1,261
EBITDA			6,534				3,460
Stock-based compensation			362				656
Merger and other costs			213				105
Expansion costs			2,104				-
Adjusted EBITDA		$	9,213			$	4,221
Adjusted EBITDA percentage of revenue			24.5	%			38.2	%
Reconciliation of Net (loss) income to Adjusted Net income:
Net (loss) income		$	(429	)		$	1,279
Merger and other costs, after tax			156				76
Expansion costs, after tax			1,536				-
Adjusted Net income:		$	1,263			$	1,355

 

 

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GREENIDGE GENERATION HOLDINGS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 2022 AND DECEMBER 31, 2021
Amounts denoted in $000's
							March 31,2022
							(Unaudited)				December 31, 2021
ASSETS
CURRENT ASSETS:
	Cash and cash equivalents						$	96,453						$	82,599
	Short term investments							-							496
	Digital assets							393							476
	Accounts receivable							5,569							5,524
	Prepaid expenses							10,286							9,146
	Emissions and carbon offset credits							1,025							2,361
				Total current assets				113,726							100,602
LONG-TERM ASSETS:
	Property and equipment, net							292,051							217,091
	Right-of-use assets							1,375							1,472
	Intangible assets							3,305							3,537
	Goodwill							3,062							3,062
	Deferred tax assets							16,846							15,058
	Other long-term assets							989							445
				Total assets			$	431,354						$	341,267
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
	Accounts payable						$	14,823						$	5,923
	Accrued emissions expense							2,637							2,634
	Accrued expenses							11,676							10,375
	Income taxes payable							3,879							2,481
	Long-term debt, current portion							66,729							19,577
	Lease obligation, current portion							500							736
				Total current liabilities				100,244								41,726
LONG-TERM LIABILITIES:
	Long-term debt, net of current portion and deferred financing fees							103,191							75,251
	Lease obligation, net of current portion							195							193
	Asset retirement obligations							2,691							2,691
	Environmental liability							8,615							8,615
	Other long-term liabilities							366							368
				Total liabilities				215,302							128,844
STOCKHOLDERS' EQUITY								216,052							212,423
				Total liabilities and stockholders' equity			$	431,354						$	341,267

 

 

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GREENIDGE GENERATION HOLDINGS INC. AND SUBSIDIARIES
LTM ADJUSTED EBITDA
RECONCILIATION OF NET (LOSS) INCOME TO ADJUSTED EBITDA
Amounts denoted in 000's
													Trailing
	Fiscal Year												12 Months
	2021				Q1 2021				Q1 2022				March 31, 2022
Net (loss) income	$	(44,480	)		$	1,279			$	(429	)		$	(46,188	)
Provision (benefit) for income taxes		408				732				(368	)			(692	)
Interest expense, net		3,692				188				3,353				6,857
Depreciation and amortization		8,855				1,261				3,978				11,572
EBITDA		(31,525	)			3,460				6,534				(28,451	)
Stock-based compensation		3,770				656				362				3,476
Goodwill impairment		42,307				-				-				42,307
Merger and other costs		32,272				105				213				32,380
Expansion costs		2,362				-				2,104				4,466
Remeasurement of environmental liability		3,688				-				-				3,688
Adjusted EBITDA	$	52,874			$	4,221			$	9,213			$	57,866

 

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