Canada NewsWire
NEW YORK, Nov. 27, 2018
NEW YORK, Nov. 27, 2018 /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 third quarter ended September 30, 2018 ("Q3 2018" or "the third quarter"), as well as the Partnership's corporate updates through the date of this press release. GDH Ltd. is a holding company which holds a minority interest in GDH LP as its only material asset. GDH LP is a diversified, multi-service merchant bank dedicated to the digital assets and blockchain technology industry. The financial results of GDH LP have been prepared and are shown separately, as GDH LP is not deemed to control GDH Ltd. as of September 30, 2018. All figures are in U.S. Dollars unless otherwise noted.
Corporate Highlights
Select GDH LP's Financial Highlights (Q3 2018)
GDH LP's Q3 2018 Financial Results
September 30, | December 31, | |||
2018 | 2017 | |||
Assets | ||||
Current assets | ||||
Cash | $ | 90,327,691 | $ | 32,098,217 |
Digital assets | 123,178,275 | 22,650,240 | ||
Investments | 199,792,651 | - | ||
Receivables | 490,912 | - | ||
Prepaid expenses and other assets | 2,908,907 | - | ||
Loans receivable | 1,772,270 | - | ||
418,470,706 | 54,748,457 | |||
Loans receivable | 16,031,773 | - | ||
Property and equipment | 1,001,984 | - | ||
17,033,757 | - | |||
Total assets | $ | 435,504,463 | $ | 54,748,457 |
Liabilities | ||||
Current liabilities | ||||
Accounts payable and accrued liabilities | $ | 14,924,453 | $ | 1,011,795 |
Digital assets sold short | 32,547,054 | - | ||
Due to related party | - | 42,650,240 | ||
Due to exchange | 1,513,722 | 9,344,613 | ||
Total liabilities | 48,985,229 | 53,006,648 | ||
Equity | ||||
Partners' capital | 379,782,664 | 1,741,809 | ||
Non-controlling interest | 6,736,570 | - | ||
Total equity | 386,519,234 | 1,741,809 | ||
Total liabilities and equity | $ | 435,504,463 | $ | 54,748,457 |
Three months ended September 30, 2018 | Nine months | ||||
Income | |||||
Advisory and management fees | $ | 1,473,297 | $ | 2,806,510 | |
Net realized loss on digital assets | (38,067,497) | (52,733,347) | |||
Other income | 535,232 | 852,128 | |||
(36,058,968) | (49,074,709) | ||||
Operating expenses | |||||
Equity based compensation | 14,311,084 | 14,311,084 | |||
Compensation and compensation related | 5,031,095 | 19,147,279 | |||
Professional fees | 6,161,619 | 9,391,601 | |||
General and administrative | 2,671,498 | 5,634,518 | |||
Interest | 1,310,341 | 4,294,669 | |||
Insurance | 480,675 | 1,752,465 | |||
Director fees | 25,000 | 25,000 | |||
(29,991,312) | (54,556,616) | ||||
Net unrealized gain (loss) on digital assets | 366,717 | (83,357,300) | |||
Net unrealized gain (loss) on investments | (4,172,597) | 16,545,019 | |||
Unrealized foreign currency gain (loss) | (1,474,820) | 92,065 | |||
Realized foreign currency gain | 893,387 | 893,387 | |||
Goodwill impairment | (6,216,914) | (6,216,914) | |||
(10,604,227) | (72,043,743) | ||||
Net loss for the period | $ | (76,654,507) | $ | (175,675,068) | |
Net loss attributed to: | |||||
Unit holders of the Partnership | $ | (75,148,680) | $ | (174,169,241) | |
Non-controlling interest | (1,505,827) | (1,505,827) | |||
$ | (76,654,507) | $ | (175,675,068) | ||
Other comprehensive loss | |||||
Foreign currency translation adjustment | (7,298) | (7,298) | |||
Net comprehensive loss for the period | $ | (76,661,805) | $ | (175,682,366) | |
Net comprehensive loss attributed to: | |||||
Unit holders of the Partnership | $ | (75,155,978) | $ | (174,176,539) | |
Non-controlling interest | (1,505,827) | (1,505,827) | |||
$ | (76,661,805) | $ | (175,682,366) |
Income and expenses by each reportable segment of GDH LP for the three months ended September 30, 2018 are as follows:
Principal | Asset | Advisory | Corporate | |||||||||
Trading | Investing | Management | Services | and Other | Totals | |||||||
Income | ||||||||||||
Advisory and management fees | $ | - | $ | - | $ | 1,370,658 | $ | 102,639 | $ | - | $ | 1,473,297 |
Net realized loss on digital assets | (38,091,252) | - | 23,755 | - | - | (38,067,497) | ||||||
Other Income | 173,134 | 151,890 | 12,743 | 11,805 | 185,660 | 535,232 | ||||||
(37,918,118) | 151,890 | 1,407,156 | 114,444 | 185,660 | (36,058,968) | |||||||
Operating expenses | ||||||||||||
Equity based compensation | 3,159,741 | 2,350,198 | 2,757,378 | 2,343,810 | 3,699,957 | 14,311,084 | ||||||
Compensation and compensation related | 1,659,640 | 582,617 | 1,054,884 | 388,787 | 1,345,167 | 5,031,095 | ||||||
Professional fees | 45,318 | 165,827 | 220,940 | 89,508 | 5,640,026 | 6,161,619 | ||||||
General and administrative | 634,054 | 121,812 | 310,090 | 742,157 | 863,385 | 2,671,498 | ||||||
Interest | 844,528 | 290,239 | - | - | 175,574 | 1,310,341 | ||||||
Insurance | - | - | - | - | 480,675 | 480,675 | ||||||
Director fees | - | - | - | - | 25,000 | 25,000 | ||||||
6,343,281 | 3,510,693 | 4,343,292 | 3,564,262 | 12,229,784 | 29,991,312 | |||||||
Net unrealized gain (loss) on digital assets | (3,189,334) | - | 3,556,051 | - | - | 366,717 | ||||||
Net unrealized gain (loss) on investments | (46,668) | (4,125,929) | - | - | - | (4,172,597) | ||||||
Unrealized foreign currency gain (loss) | 82,989 | - | - | 11,921 | (1,569,730) | (1,474,820) | ||||||
Realized foreign currency gain (loss) | (52,095) | - | - | - | 945,482 | 893,387 | ||||||
Goodwill impairment | - | - | - | - | (6,216,914) | (6,216,914) | ||||||
(3,205,108) | (4,125,929) | 3,556,051 | 11,921 | (6,841,162) | (10,604,227) | |||||||
Net comprehensive income (loss) | $ | (47,466,507) | $ | (7,484,732) | $ | 619,915 | $ | (3,437,897) | $ | (18,885,286) | $ | (76,654,507) |
* Above table represents the three months ended September 30, 2018. These amounts can also be derived by subtracting the six months ended June 30, 2018 from the nine months ended September 30, 2018, as previously disclosed. | ||||||
Assets by each reportable segment of GDH LP as of September 30, 2018 are as follows:
Principal | Asset | Advisory | Corporate | |||||||||
Trading | Investing | Management | Services | and Other | Totals | |||||||
Assets | ||||||||||||
Cash | $ | 86,781,301 | $ | 358,161 | $ | 1,633,470 | $ | 350,870 | $ | 1,203,889 | $ | 90,327,691 |
Digital assets | 123,178,275 | - | - | - | - | 123,178,275 | ||||||
Investments | 181,552 | 199,611,099 | - | - | - | 199,792,651 | ||||||
Receivables | - | 24,898 | 32,032 | 358,174 | 75,808 | 490,912 | ||||||
Prepaid expenses and other assets | 511,498 | - | 677,363 | 233,286 | 1,486,760 | 2,908,907 | ||||||
Loans receivable | - | 17,444,042 | - | 360,001 | - | 17,804,043 | ||||||
Property and equipment | 4,448 | - | - | 35,805 | 961,731 | 1,001,984 | ||||||
$ | 210,657,074 | $ | 217,438,200 | $ | 2,342,865 | $ | 1,338,136 | $ | 3,728,188 | $ | 435,504,463 |
Select statement of financial position information
The fair value of each asset class by reporting segment of GDH LP as of September 30, 2018 is as follows:
Principal | Asset | Corporate | ||||||||||
Trading | Investing | Management | Advisory | and Other | Totals | |||||||
Digital assets: | ||||||||||||
Cryptocurrency | $ | 123,178,275 | $ | - | $ | - | $ | - | $ | - | $ | 123,178,275 |
Investments: | ||||||||||||
Pre-ICO | - | 3,648,351 | - | - | - | 3,648,351 | ||||||
Convertible Note | - | 100,000 | - | - | - | 100,000 | ||||||
Preferred Stock | - | 56,862,464 | - | - | - | 56,862,464 | ||||||
Common Stock | 108,072 | 97,933,172 | - | - | - | 98,041,244 | ||||||
LP/LLC Interests | - | 38,367,151 | - | - | - | 38,367,151 | ||||||
Warrants/Trust Units | 73,480 | 2,699,961 | - | - | - | 2,773,441 | ||||||
$ | 123,359,827 | $ | 199,611,099 | $ | - | $ | - | $ | - | $ | 322,970,926 |
This press release should be read in conjunction with (i) GDH LP's Management Discussion and Analysis and Consolidated Financial Statements for the three and nine months ended September 30, 2018 and (ii) GDH Ltd.'s Management Discussion and Analysis and Consolidated Financial Statements for the three and nine months ended September 30, 2018, which have been filed on SEDAR at www.sedar.com.
About GDH Ltd. and GDH LP (Galaxy Digital)
Galaxy Digital Holdings Ltd. is a holding company whose 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 the general partner of GDH LP is Michael Novogratz. The Partnership 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
See the press releases of Bradmer dated January 9, 2018, February 14, 2018, March 15, 2018, April 13, 2018, May 18, 2018, June 11, 2018, June 12, 2018, June 18, 2018, and July 31, 2018 for further information concerning the Arrangement.
The TSXV has in no way passed upon the merits of the Arrangement and 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.
Forward-Looking Statements
Certain information in this press release, including, but not limited to, statements regarding future business operations, deals and 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. As a result, you should not rely on such forward-looking statements. Additional information identifying assumptions, risks and uncertainties relating to Galaxy Digital is contained in Galaxy Digital's filings with the Canadian securities regulators available at www.sedar.com. These risks include those discussed in the risk factors section in the Notice of Annual and Special Meeting of Shareholders and Management Information Circular dated May 14, 2018. 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.
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1 Net book value per unit is calculated as partners' capital divided by the outstanding number of units of 278.5 million as of September 30, 2018 |
SOURCE Galaxy Digital Holdings Ltd.
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