Canada NewsWire
NEW YORK, Aug. 28, 2019
NEW YORK, Aug. 28, 2019 /CNW/ - Galaxy Digital Holdings Ltd. (TSXV: GLXY; Frankfurt: 7LX) ("Galaxy Digital", "GDH Ltd.", or the "Company") today released both Galaxy Digital Holdings LP's ("GDH LP" or the "Partnership") and GDH Ltd.'s financial results for the three and six months ended June 30, 2019 ("Q2 2019" or "the second quarter"), as well as the Partnership's corporate updates through the date of this press release.
"Looking back at the second quarter, I am very pleased with our latest accomplishments across our business lines, including our significant progress in obtaining critical regulatory licenses and disciplined deployment of capital into a number of attractive investment opportunities," said Michael Novogratz, Founder and CEO of Galaxy Digital. "We saw a notable increase in activity across each of our operating businesses, as we were able to leverage the platform that we've built to capitalize on the improving digital assets market. Looking ahead, we remain focused on continuing to strategically scale our business and positioning ourselves to be opportunistic as the space institutionalizes and evolves."
Corporate Updates
Business Highlights
Select GDH LP's Financial Highlights (Q2 2019)
___________________________ |
1 Net book value includes non-controlling interests. |
GDH LP's Q2 2019 Financial Results
June 30, | December 31, | ||||
2019 | 2018 | ||||
Assets | |||||
Current assets | |||||
Cash | $ | 84,436,373 | $ | 66,488,012 | |
Digital assets | 184,588,518 | 69,765,339 | |||
Investments | 151,931,264 | 179,365,696 | |||
Receivable for digital asset trades | 5,228,250 | 8,579,058 | |||
Assets posted as collateral | 9,785,643 | — | |||
Receivables | 1,141,387 | 1,238,694 | |||
Prepaid expenses and other assets | 2,601,722 | 2,002,880 | |||
Loans receivable | 4,756,657 | 2,369,024 | |||
444,469,814 | 329,808,703 | ||||
Loans receivable | 15,963,623 | 15,892,320 | |||
Right of use asset | 4,557,054 | — | |||
Property and equipment | 3,962,111 | 4,223,252 | |||
24,482,788 | 20,115,572 | ||||
Total assets | $ | 468,952,602 | $ | 349,924,275 | |
Liabilities | |||||
Current liabilities | |||||
Digital assets sold short | $ | 528,529 | $ | 18,666,957 | |
Accounts payable and accrued liabilities | 8,902,814 | 14,558,914 | |||
Payable for digital asset trades | 6,115,274 | 9,832,737 | |||
Collateral payable | 784,634 | — | |||
Lease liability | 695,631 | — | |||
Due to related party | — | 1,177,498 | |||
Due to broker | 370,918 | — | |||
17,397,800 | 44,236,106 | ||||
Lease Liability | 4,022,532 | — | |||
Total liabilities | 21,420,332 | 44,236,106 | |||
Equity | |||||
Partners' capital | 435,948,334 | 301,520,591 | |||
Non-controlling interest | 11,583,936 | 4,167,578 | |||
Total equity | 447,532,270 | 305,688,169 | |||
Total liabilities and equity | $ | 468,952,602 | $ | 349,924,275 |
Three months | Three months | Six months | Six months | |||||||||
Income (loss) | ||||||||||||
Advisory and management fees | $ | 1,329,700 | $ | 1,303,302 | $ | 2,850,211 | $ | 1,333,213 | ||||
Net realized gain (loss) on digital assets | 98,099,376 | (1,139,007) | 115,570,500 | (14,665,850) | ||||||||
Realized gain on investments | 38,100,635 | — | 38,100,635 | — | ||||||||
Interest income | 920,159 | 296,149 | 1,625,922 | 297,074 | ||||||||
Other income | 5,090,313 | — | 5,699,309 | 19,822 | ||||||||
143,540,183 | 460,444 | 163,846,577 | (13,015,741) | |||||||||
Operating expenses | ||||||||||||
Equity based compensation | 6,822,269 | — | 17,143,772 | — | ||||||||
Compensation and compensation related | 7,725,305 | 7,808,602 | 14,679,470 | 14,116,184 | ||||||||
Professional fees | 1,011,301 | 1,455,082 | 3,616,627 | 3,229,982 | ||||||||
General and administrative | 1,887,780 | 1,490,397 | 4,409,070 | 2,963,020 | ||||||||
Interest | 938,928 | 2,325,574 | 1,627,254 | 2,984,328 | ||||||||
Insurance | 330,254 | 536,790 | 757,104 | 1,271,790 | ||||||||
Director fees | 50,000 | — | 100,000 | — | ||||||||
(18,765,837) | (13,616,445) | (42,333,297) | (24,565,304) | |||||||||
Net unrealized gain (loss) on digital assets | 11,613,204 | 1,816,396 | 10,948,674 | (83,724,017) | ||||||||
Net unrealized gain (loss) on investments | (22,724,996) | 44,755,752 | (5,822,225) | 20,717,616 | ||||||||
Unrealized foreign currency gain | 189,526 | 1,566,885 | 280,598 | 1,566,885 | ||||||||
Realized foreign currency loss | (89,226) | — | (199,738) | — | ||||||||
(11,011,492) | 48,139,033 | 5,207,309 | (61,439,516) | |||||||||
Income (loss) for the period | $ | 113,762,854 | $ | 34,983,032 | $ | 126,720,589 | $ | (99,020,561) | ||||
Income (loss) attributed to: | ||||||||||||
Unit holders of the Partnership | 107,964,998 | 34,983,032 | 120,535,626 | (99,020,561) | ||||||||
Non-controlling interest | 5,797,856 | — | 6,184,963 | — | ||||||||
$ | 113,762,854 | $ | 34,983,032 | $ | 126,720,589 | $ | (99,020,561) | |||||
Other comprehensive income (loss) | ||||||||||||
Foreign currency translation adjustment | 4,666 | — | (88,268) | — | ||||||||
Comprehensive income (loss) for the period | $ | 113,767,520 | $ | 34,983,032 | $ | 126,632,321 | $ | (99,020,561) | ||||
Comprehensive income (loss) attributed to: | ||||||||||||
Unit holders of the Partnership | $ | 107,969,664 | $ | 34,983,032 | $ | 120,447,358 | $ | (99,020,561) | ||||
Non-controlling interest | 5,797,856 | — | 6,184,963 | — | ||||||||
$ | 113,767,520 | $ | 34,983,032 | $ | 126,632,321 | $ | (99,020,561) |
Income and expenses by each reportable segment of GDH LP for the three months ended June 30, 2019 are as follows:
Principal | Asset | Advisory | Corporate | ||||||||||||||
Trading | Investing | Management | Services | and Other | Totals | ||||||||||||
Income | |||||||||||||||||
Advisory and management fees | $ | — | $ | — | $ | 1,329,700 | $ | — | $ | — | $ | 1,329,700 | |||||
Net realized gain (loss) on digital assets | 98,711,252 | (611,876) | — | — | — | 98,099,376 | |||||||||||
Net realized gain on investments | — | 38,100,635 | — | — | — | 38,100,635 | |||||||||||
Interest Income | 244,242 | 659,445 | — | 16,256 | 216 | 920,159 | |||||||||||
Other Income | 5,094,063 | 30,000 | (33,750) | — | — | 5,090,313 | |||||||||||
104,049,557 | 38,178,204 | 1,295,950 | 16,256 | 216 | 143,540,183 | ||||||||||||
Operating expenses | 5,298,802 | 1,556,254 | 3,928,206 | 2,381,366 | 5,601,209 | 18,765,837 | |||||||||||
Net unrealized gain (loss) on digital assets | 1,822,201 | 9,791,003 | — | — | — | 11,613,204 | |||||||||||
Net unrealized loss on investments | — | (22,724,996) | — | — | — | (22,724,996) | |||||||||||
Unrealized foreign currency gain (loss) | 197,208 | — | — | (7,639) | (43) | 189,526 | |||||||||||
Realized foreign currency loss | (89,226) | — | — | — | — | (89,226) | |||||||||||
1,930,183 | (12,933,993) | — | (7,639) | (43) | (11,011,492) | ||||||||||||
Net income (loss) | $ | 100,680,938 | $ | 23,687,957 | $ | (2,632,256) | $ | (2,372,749) | $ | (5,601,036) | $ | 113,762,854 |
Income and expenses by each reportable segment of GDH LP for the three months ended June 30, 2018 are as follows:
Principal | Asset | Advisory | Corporate | ||||||||||||||
Trading | Investing | Management | Services | and Other | Totals | ||||||||||||
Income | |||||||||||||||||
Advisory and management fees | $ | — | $ | — | $ | 523,068 | $ | 780,234 | $ | — | $ | 1,303,302 | |||||
Net realized loss on digital assets | (1,115,252) | (23,755) | — | — | — | (1,139,007) | |||||||||||
Interest income | 296,149 | — | — | — | — | 296,149 | |||||||||||
Other income | — | — | — | — | — | — | |||||||||||
(819,103) | (23,755) | 523,068 | 780,234 | — | 460,444 | ||||||||||||
Operating expenses | 4,355,257 | 1,942,403 | 1,697,620 | 554,760 | 5,066,405 | 13,616,445 | |||||||||||
Net unrealized gain (loss) on digital assets | 5,402,936 | (3,586,540) | — | — | — | 1,816,396 | |||||||||||
Net unrealized gain on investments | — | 44,755,752 | — | — | — | 44,755,752 | |||||||||||
Net unrealized gain (loss) on foreign currencies | (2,845) | — | — | — | 1,569,730 | 1,566,885 | |||||||||||
5,400,091 | 41,169,212 | — | — | 1,569,730 | 48,139,033 | ||||||||||||
Net income (loss) | $ | 225,731 | $ | 39,203,054 | $ | (1,174,552) | $ | 225,474 | $ | (3,496,675) | $ | 34,983,032 |
Assets and liabilities by reportable segment of GDH LP as of June 30, 2019 are as follows:
Principal | Asset | Advisory | Corporate | ||||||||||||||
Trading | Investing | Management | Services | and Other | Totals | ||||||||||||
Total assets | $ | 259,146,406 | $ | 191,306,429 | $ | 1,948,093 | $ | 771,185 | $ | 15,780,489 | $ | 468,952,602 | |||||
Total liabilities | $ | 8,106,353 | $ | 298,264 | $ | 936,869 | $ | 11,221 | $ | 12,067,625 | $ | 21,420,332 |
Assets and liabilities by reportable segment of GDH LP as of December 31, 2018 are as follows:
Principal | Asset | Advisory | Corporate | ||||||||||||||
Trading | Investing | Management | Services | and Other | Totals | ||||||||||||
Total assets | $ | 121,987,903 | $ | 209,065,821 | $ | 2,427,877 | $ | 1,081,640 | $ | 15,361,034 | $ | 349,924,275 | |||||
Total liabilities | $ | 28,720,908 | $ | 162,086 | $ | 105,946 | $ | 157,811 | $ | 15,089,355 | $ | 44,236,106 |
Select statement of financial position information
The fair value of each asset class by reporting segment of GDH LP as of June 30, 2019 is as follows:
Principal | Asset | Advisory | Corporate | ||||||||||||||
Trading | Investing | Management | Services | and Other | Totals | ||||||||||||
Digital assets: | |||||||||||||||||
Cryptocurrency | $ | 166,649,734 | $ | 17,938,784 | $ | — | $ | — | $ | — | $ | 184,588,518 | |||||
Digital assets posted as collateral | 5,824,060 | — | — | — | — | 5,824,060 | |||||||||||
Investments: | |||||||||||||||||
Pre-ICO | — | 3,144,204 | — | — | — | 3,144,204 | |||||||||||
Convertible Notes | — | 3,415,000 | — | — | 3,415,000 | ||||||||||||
Preferred Stock | — | 72,737,431 | — | — | — | 72,737,431 | |||||||||||
Common Stock | — | 32,207,163 | — | — | — | 32,207,163 | |||||||||||
LP/LLC Interests | — | 37,859,235 | — | — | — | 37,859,235 | |||||||||||
Warrants/Trust Units | — | 2,568,231 | — | — | — | 2,568,231 | |||||||||||
$ | 172,473,794 | $ | 169,870,048 | $ | — | $ | — | $ | — | $ | 342,343,842 |
The fair value of each asset class by reporting segment of GDH LP as of December 31, 2018 is as follows:
Principal | Asset | Advisory | Corporate | ||||||||||||||
Trading | Investing | Management | Services | and Other | Totals | ||||||||||||
Digital assets: | |||||||||||||||||
Cryptocurrency | $ | 62,662,014 | $ | 7,103,325 | $ | — | $ | — | $ | — | $ | 69,765,339 | |||||
Investments: | |||||||||||||||||
Pre-ICO | — | 3,444,204 | — | — | — | 3,444,204 | |||||||||||
Convertible Notes | — | 1,250,000 | — | — | — | 1,250,000 | |||||||||||
Preferred Stock | — | 59,586,719 | — | — | — | 59,586,719 | |||||||||||
Common Stock | — | 80,483,775 | — | — | — | 80,483,775 | |||||||||||
LP/LLC Interests | — | 33,248,472 | — | — | — | 33,248,472 | |||||||||||
Warrants/Trust Units | — | 1,352,526 | — | — | — | 1,352,526 | |||||||||||
$ | 62,662,014 | $ | 186,469,021 | $ | — | $ | — | $ | — | $ | 249,131,035 |
This press release should be read in conjunction with (i) GDH LP's Management Discussion and Analysis and Condensed Consolidated Interim Financial Statements for the three and six months ended June 30, 2019 and (ii) GDH Ltd.'s Management Discussion and Analysis and Condensed Consolidated Interim Financial Statements for the three and six months ended June 30, 2019 (together, the "Consolidated Financial Statements" and "MD&As"), which have been filed on SEDAR at www.sedar.com.
About GDH Ltd. and GDH LP (Galaxy Digital)
Galaxy Digital Holdings Ltd.'s only significant asset is a minority investment in GDH LP. GDH LP is a diversified, multi-service merchant bank dedicated to the digital assets and blockchain technology industry. GDH LP's multi-disciplinary team has extensive experience spanning investing, portfolio management, capital markets, operations, and blockchain technology. GDH LP currently operates four distinct business lines, which include: Trading, Asset Management, Principal Investing and Advisory Services. The CEO of GDH Ltd. and the general partner of GDH LP is Michael Novogratz. GDH LP is headquartered in New York City, with offices in London, Tokyo, Hong Kong, the Cayman Islands (registered office) and New Jersey. Additional information about GDH LP's businesses and products is available on www.galaxydigital.io.
Disclaimers and Additional Information
The TSXV has neither approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release. The Ontario Securities Commission has not passed upon the merits of the disclosure record of Galaxy Digital.
FINRA's approval of a continuing membership application does not constitute or imply that FINRA approves of or endorses any security or product offered by the member firm.
The SEC's granting of registered investment adviser status does not imply SEC approval or disapproval nor a certain level of skill or training of an investment adviser.
BLOOMBERG is a trademark or service mark of Bloomberg Finance L.P. GALAXY is a trademark of GDCM. Bloomberg Finance L.P. and its affiliates (collectively, Bloomberg) are not affiliated with GDCM, the GBCIF and their respective affiliates (collectively, Galaxy). Bloomberg's association with Galaxy is to act as the administrator and calculation agent of the BGCI, which is the property of Bloomberg. Neither Bloomberg nor Galaxy guarantee the timeliness, accurateness, or completeness of any data or information relating to the BGCI or results to be obtained. Neither Bloomberg nor Galaxy make any warranty, express or implied, as to the BGCI, any data or values relating thereto or any financial product or instrument linked to, using as a component thereof or based on the BGCI (Products) or results to be obtained therefrom, and expressly disclaims all warranties of merchantability and fitness for a particular purpose with respect thereto. To the maximum extent allowed by law, Bloomberg, Galaxy and its or their licensors, and its and their respective employees, contractors, agents, suppliers, and vendors shall have no liability or responsibility whatsoever for any injury or damages-whether direct, indirect, consequential, incidental, punitive, or otherwise-arising in connection with the BGCI, any data or values relating thereto or any Products-whether arising from their negligence or otherwise.
Forward-Looking Statements
Certain information in this press release, including, but not limited to, statements regarding the future of the industry the Company or Partnership's anticipated results, business or opportunities, may constitute forward looking information (collectively, forward-looking statements), which can be identified by the use of terms such as "may," "will," "should," "expect," "anticipate," "project," "estimate," "intend," "continue" or "believe" (or the negatives) or other similar variations. Because of various risks and uncertainties, including those referenced below, actual events or results may differ materially from those reflected or contemplated in such forward-looking statements. Forward looking statements are subject to the risk that the industry or the Company's businesses do not perform as anticipated, that revenue or expenses estimates may not be met or may be materially less or more than those anticipated, that expected advisory transactions may be modified or not completed at all and those other risks discussed in the risks and uncertainties section in the Partnership's and the Company's Management Discussion and Analysis for the year ended December 31, 2018. Factors that could cause actual results of the Company and its businesses to differ materially from those described in such forward-looking statements include, but are not limited to, a decline in the digital asset market or general economic conditions; the failure or delay in the adoption of digital assets and the blockchain ecosystem by institutions; a delay or failure in developing infrastructure for the trading business or achieving mandates; and for advisory transactions, a decline in the securities markets, an adverse development with respect to an issuer or party to the transaction or failure to obtain a required regulatory approval. In connection with the forward-looking statements contained in this press release, the Company has made assumptions that no significant events occur outside of the Company's and Partnership's normal course of business. Forward-looking statements are not guarantees of future performance, accordingly, you should not put undue reliance on forward-looking statements. Information identifying assumptions, risks and uncertainties relating to the Company and the Partnership are contained in Galaxy Digital's filings with the Canadian securities regulators available at www.sedar.com. The forward-looking statements in this press release are applicable only as of the date of this release or as of the date specified in the relevant forward-looking statement and Galaxy Digital undertakes no obligation to update any forward-looking statement to reflect events or circumstances after that date or to reflect the occurrence of unanticipated events.
All figures are in U.S. Dollars unless otherwise noted.
SOURCE Galaxy Digital Holdings Ltd
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