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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM 20-F/A

(Amendment No. 1)

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(Mark One)

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Commission file number 001-40816

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Securities registered or to be registered pursuant to Section 12(b) of the Act.

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* The ordinary shares are not for trading, but only in connection with the listing of the American depositary shares on the Nasdaq Stock Market LLC.

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Securities registered or to be registered pursuant to Section 12(g) of the Act: None

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Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

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Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.

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Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

☐ Yes   ☒ No

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If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

☐ Yes   ☒ No

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒ Yes   ☐ No

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒ Yes   ☐ No

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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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†The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

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Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b) by the registered public accounting firm that prepared or issued its audit report.  ☐

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If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.  ☒

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Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).  ☒

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Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

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If “Other” has been checked in response to the previous question indicate by check mark which financial statement item the registrant has elected to follow.

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☐  Item 17 or ☐  Item 18

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If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

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☐Yes   ☒ No

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EXPLANATORY NOTE

Argo Blockchain plc (the “Company,” “we,” “our,” or “us”) is filing this Amendment No. 1 on Form 20-F/A (this “Amendment No. 1”) to its annual report on Form 20-F for the fiscal year ended December 31, 2023 (the “Original Filing”), as originally filed with the Securities and Exchange Commission (the “SEC”) on April 30, 2024, to respond to a comment letter received from the SEC in connection with its review of the Original Filing and to correct a material error in its audited consolidated financial statements as at and for the years ended December 31, 2023, 2022 and 2021. In connection therewith, the Company is filing restated audited consolidated financial statements of the Company as of and for the years ended December 31, 2023, 2022 and 2021 (the “Restated Financial Statements”), including the Report of Independent Registered Public Accounting Firm with respect thereto. In addition, the Company is including in this Amendment No. 1 its restated Operating and Financial Review and Prospects for the year ended December 31, 2023 (the “Restated OFRP”).

The Restated Financial Statements and Restated OFRP have been restated to correct a material error in the Company’s accounting for its mined cryptocurrencies. The Company accounted for these assets as current digital assets at fair value through profit or loss, when they should have been accounted for as intangible assets at fair value through other comprehensive income. The impact to the balance sheet is a change in the description of the asset from digital assets to intangible assets. The impact to the income statement is twofold:

While net income (loss) is improved in each year presented, there is no change to total comprehensive income (loss).

The impact to the cash flow statement is a reclassification between operating cash flow and investing cash flow. Specifically, proceeds from the sales of digital assets have been reclassified from cash flows from operations to cash flows from investing activities. There is no change to total comprehensive loss or cash.

In connection with the Restated Financial Statements and Restated OFRP, management has reassessed its evaluation of the effectiveness of its internal control over financial reporting and disclosure controls and procedures as of December 31, 2023 as further described in this Amendment No. 1. Based on such reassessment, the Company identified a material weakness in its internal control over financial reporting. Therefore, management concluded that internal control over financial reporting and disclosure controls and procedures were not effective as of December 31, 2023.

Pursuant to Rule 12b-15, new certifications by our chief executive officer (“CEO”) and chief financial officer (“CFO”) are being filed as exhibits to this Amendment No. 1. The amended “Item 19. Exhibits” of Part III of the Original Filing is included in this Amendment No. 1.

This Amendment No. 1 speaks as of the filing date of the Original Filing on April 30, 2024. Other than as described above, this Amendment No. 1 does not, and does not purport to, amend, update or restate any other information or disclosure included in the Original Filing or reflect any events that have occurred after the filing of the Original Filing on April 30, 2024. Accordingly, this Amendment No. 1 should be read in conjunction with filings made with the SEC subsequent to the filing of the Original Filing.

Any consolidated financial statements and related financial information for the periods contained in the Restated Financial Statements and Restated OFRP contained in any reports filed or furnished prior to the date hereof should no longer be relied upon.

Item 5.    Operating and Financial Review and Prospects

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the Restated Financial Statements, including the notes thereto, included in this Amendment No. 1, as well as “Presentation of Financial and Certain Other Information,” Item 3.D. “Risk Factors” and Item 4.B. “Business Overview.”

The following discussion includes certain forward-looking statements. Actual results may differ materially from those discussed in such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this Annual Report.

Overview

We are a leading blockchain technology company focused on large-scale mining of Bitcoin. We mine using purpose-built computers (or “mining machines”) to solve complex cryptographic algorithms (or “verify” or “solve” blocks) in the blockchain in exchange for rewards and fees denominated in the native token of that blockchain network.

We were founded in late 2017, and initially focused on providing our mining capacity as a service to our customers. In this initial model, customers contracted Bitcoin mining services from us for a fee, and our customers would earn the Bitcoin rewards generated from the contracted mining services directly to their cryptocurrency wallet address. Beginning in 2019, we chose to wind down our mining-as-a-service business and shifted to mining for our own account to increase our revenues and margins. In 2023, we did not have any mining-as-a service revenue.

Upon our shift to mining for our own account, we began substantially increasing our investment in mining machines, and we have our mining machines hosted in facilities operated by third parties as well as in facilities that we own and operate. As of December 31, 2023, we had approximately 2.8 exahash of mining capacity, of which approximately 0.4 exahash was located in facilities we own in Quebec, Canada, and approximately 2.4 exahash was located in hosted facilities.

In 2023, our treasury management strategy was to sell our mined Bitcoin on a weekly basis in order to fund our operating expenses and for working capital needs. Cryptocurrency held in treasury is marked to market at the end of each of our financial reporting periods, with gains and losses reflected as changes in fair value of digital currencies in our income statement. As a result, our operating results and total assets vary in direct proportion to the value of the applicable cryptocurrencies we hold in a given period, and these variations may be substantial.

In 2021, 2022 and 2023, we mined 2,045, 2,156, and 1,760 Bitcoin, respectively, and our total revenues were $98.7 million, $58.5 million, and $50.6 million, respectively. In 2022, our total comprehensive loss was $246.7 million and, in 2023, our total comprehensive loss was $32.2 million.

Our recurring losses from operations, the pending maturities of and debt service on our outstanding indebtedness, and macroeconomic conditions in the cryptocurrency markets, among other factors, raise substantial doubt about our ability to continue as a going concern. These factors and management’s assessment of our prospects to continue as a going concern are included disclosures in Note 3 of the financial statements, and our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements for the year ended December 31, 2023 with respect to this uncertainty. Our 2023 financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty. Our ability to continue as a going concern will require us to obtain additional funding. If we are unable to raise capital when needed or on acceptable terms, we could be forced to delay, reduce or eliminate certain of our operations, and our stockholders could lose all, or a significant portion, of their investment in us.

A.    Operating Results

Factors Affecting Our Results of Operations

Market Value of Bitcoin and other Cryptocurrency.

Substantially all of our current business is focused on mining Bitcoin. Our revenue is primarily comprised of the value of Bitcoin rewards and transaction fees we earn by mining the blockchain. Our operating results and financial condition are substantially affected by fluctuations and long-term trends in the value of Bitcoin. In 2022, the rapid decline in Bitcoin and other cryptocurrency pricing materially and adversely affected our revenue, financial condition and operating results, and required us to divest a substantial portion of our Bitcoin as well as our Helios mining facility in Texas in order to meet operating expenses and avoid default under our credit facilities. In 2023, Bitcoin mining economics improved, allowing us to significantly reduce our debt, deploy additional hashrate capacity in Quebec, and strengthen our balance sheet. We carefully monitor fluctuations and longer-term trends in the value of Bitcoin, which impacts the price of machines, when planning our short- and long-term operating strategies and capital expenditures. We also regularly evaluate potential innovations in geography, physical footprint, infrastructure computing technology and similar areas to improve our operations and productivity. We believe this strategy will enable us to build value over the long term, and differentiates us from competitors whose decisions, we believe, are driven principally by short-term market dynamics and opportunities.

The market for cryptocurrencies is new, rapidly evolving and subject to regulatory, tax, political and market factors beyond our control. Increased hashrate in the market resulting from the deployment of new mining machines will generally lead to increases in mining difficulty, which in turn decreases our revenue and adversely affects our mining margins. Further, reward rates for cryptocurrency are subject to adjustments at predetermined intervals. For example, for Bitcoin, the reward was initially set at 50 Bitcoin rewards per block and this was cut in half to 25 on November 28, 2012 at block 210,000, again to 12.5 on July 9, 2016 at block 420,000 and again to 6.25 on May 11, 2020 at block 630,000. The most recent halving for Bitcoin occurred on April 19, 2024 at block 840,000, when the reward was reduced to 3.125. These adjustments have had and will continue to have material effects on the economic viability of mining assets that are in production. These factors could lead to material adverse changes in the market for Bitcoin, which could in turn result in substantial damage to or even the failure of our business. See Item 3. D. “Risk Factors — Risks Related to Cryptocurrency Mining — The cryptocurrency for which we currently mine, Bitcoin, is subject to halving; the cryptocurrency reward for successfully uncovering a block will halve several times in the future and the cryptocurrency’s value may not adjust to compensate us for the reduction in the rewards we receive from our mining efforts.”

Capacity and Efficiency of Mining Machines.

The cryptocurrency mining industry is currently undergoing an arms race in mining technology and increased capacity, as miners need to deploy increasingly sophisticated mining machines in ever greater quantities to remain competitive. While many of our competitors have embraced a “bigger is better” growth strategy, we believe that our commitment to mining efficiency and return on investment in mining machines will remain our competitive advantage. To maintain this competitive advantage over the long term, we must develop and maintain strong relationships across the mining machine supply chain, strategically invest in state-of-the art mining machines at attractive prices, and effectively manage our fleet as it ages along the obsolescence curve.

Cost and Source of Power.

Mining cryptocurrency is a power-intensive process, with electrical power required both to operate the mining machines and to dissipate the significant amount of heat generated by operating the machines. We believe the combination of the increasing difficulty of successfully mining rewards, driven by greater hashrates, and the periodic adjustment of reward rates, such as the halving of Bitcoin rewards, will drive the increasing importance of power efficiency in cryptocurrency mining over the long term. Moreover, we believe that cryptocurrency miners have a social responsibility to obtain the power required for their operations from clean power sources as much as possible. However, there is no guarantee that we will be able to negotiate these power agreements on these terms, or at all, including for example, due to limitations in availability and fluctuations in the cost of electricity. See Item 3. D. “Risk Factors — Risks Related to Cryptocurrency Mining — We may not be able to secure access to electricity on a sufficiently firm and unrestricted basis or at a price that we are willing to pay” and “Risk Factors — Risks Related to Cryptocurrency Mining — We may be affected by price fluctuations in the wholesale and retail power markets.”

Competition.

Our business environment is constantly evolving, and cryptocurrency miners can range from individual enthusiasts to professional mining operations with dedicated mining facilities. We compete with other companies that focus all or a portion of their activities on mining activities at scale. We believe that the trend of increasing market prices for Bitcoin and other major cryptocurrencies we observed beginning in the third quarter of 2020 has resulted in an increase in the scale and sophistication of competition in the cryptocurrency mining industry, with new entrants and existing competitors gaining access to substantial capital resources to build ever larger mining operations. To the extent the market price for Bitcoin increases, we believe many new and existing competitors may be encouraged to build or expand Bitcoin mining operations.

Key Indicators of Performance and Financial Condition and Non-IFRS Financial Measures

Key operating and financial metrics that we use, in addition to our IFRS consolidated financial statements, to assess the performance of our business are set forth below for the years ended December 31, 2023, 2022, and 2021, along with the most comparable IFRS measures:

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Mining Profit Margin, Average Total Cost per Bitcoin Mined, Average Direct Cost Per Bitcoin Mined, EBITDA, and Adjusted EBITDA are not measures defined by IFRS. Average Total Cost Per Bitcoin Mined equals direct costs divided by total bitcoin mined. The other key measures are defined below.

These measures should not be considered as an alternative to IFRS measures, and they are not necessarily comparable to similarly titled measures used by other companies. As a result, you should not consider these measures in isolation from, or as a substitute analysis for, our gross margin or net income/(loss), as applicable, as determined in accordance with IFRS.

Bitcoin Mined

We measure the production of our mining activities in a given period as Bitcoin Mined. In prior years, Bitcoin Mined included rewards and transaction fees for mining Bitcoin and other cryptocurrencies. We generally exchange forms of cryptocurrency other than Bitcoin into Bitcoin in the period in which such currency is earned, and we hold Bitcoin in treasury that we do not otherwise sell to fund our operating expenses. As such, we believe that the number of Bitcoin that we mine is a useful metric for investors to measure our mining activity.

Mining Profit Margin

We define Mining Profit Margin as the difference between cryptocurrency mining revenue and our direct costs (excluding depreciation of mining equipment), divided by cryptocurrency mining revenue, expressed as a percentage. We use this measure, and believe it is meaningful to investors, because it is reflective of the return on marginal investment of mining Bitcoin. In addition, because we have generally recovered the original cost of our mining machines in advance of their thirty-six to forty-eight month accounting depreciation curve, once machines are installed and operating we internally monitor Mining Profit to obtain what we believe to be an accurate reflection of the profitability of our core mining operations. Mining Profit Margin is a supplemental measure of our performance that is not required by, or presented in accordance with, IFRS. This measure should not be considered as an alternative to gross margin determined in accordance with IFRS. The decrease in mining margin from 2022 was driven primarily by the 71% increase in average network difficulty in 2023. The table below reconciles Mining Profit to gross profit, the most directly comparable IFRS measure:

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Average Direct Cost per Bitcoin Mined.

We define the Average Direct Cost per Bitcoin Mined as the total direct costs of mining at both our owned facilities and hosted facilities (excluding depreciation of mining equipment), divided by total Bitcoin Mined over a given period. For mining at owned facilities, direct mining expenses are inclusive of power costs. For mining at hosted facilities, direct mining expenses are inclusive of the all-in hosting fee that is charged as well as any related service fees. We believe this measure is a useful complement to Mining Profit, as it reflects the average marginal direct cost of each reward earned irrespective of the value of such reward at the time it is earned. Average Direct Cost per Bitcoin Mined excludes the depreciation of mining equipment and so does not reflect the full cost of our mining operations. In addition, Average Direct Cost per Bitcoin Mined or similar non-IFRS measures are utilized by analysts in the cryptocurrency mining industry to compare results across peer companies, and accordingly we believe that excluding the depreciation of mining equipment from Average Direct Cost per Bitcoin Mined is appropriate to facilitate accurate comparisons to the financial performance of other industry participants. Average Direct Cost per Bitcoin Mined is a supplemental measure of our performance that is not required by, or presented in accordance with, IFRS. This measure should not be considered as an alternative to IFRS measures. The table below reconciles Average Direct Cost Per Bitcoin Mined to Average Total Cost Per Bitcoin Mined, the most directly comparable IFRS measure:

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EBITDA

We define EBITDA as our operating income plus depreciation and amortization. As a capital intensive business, EBITDA removes the cost of depreciation of mining equipment. This metric allows us to monitor the profitability of our underlying business on a current basis, and we believe it provides a useful metric for comparing our performance to those of similar companies.

Adjusted EBITDA

Adjusted EBITDA provides this same indicator of Argo’s EBITDA from operations but additionally excludes any unrealized foreign exchange gains or losses, stock-based compensation charges, restructuring charges, and other one-time impairments and costs that are not expected to be repeated in order to provide greater insight into the cash flow being produced from our operating business, without the influence of extraneous events.

EBITDA and Adjusted EBITDA are supplemental measures of our performance that are not required by, or presented in accordance with, IFRS. This measure should not be considered as an alternative to operating income/(loss) determined in accordance with IFRS. The table below reconciles Adjusted EBITDA to net income/(loss), the most directly comparable IFRS measure:

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Supplemental Information

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Notes

Components of Our Results of Operations

Total revenue

Our revenues primarily consist of cryptocurrency that we mine. In 2021, 2022 and 2023, we principally focused on mining Bitcoin. We participate in mining pools, with the pool’s performance obligation being the delivery of cryptocurrency into our wallet once an algorithm has been solved by the pool. Our mining revenue consists of our share of the block reward the pool earns for solving the block, and our share of transaction fees associated with the transactions comprising the block. Our share of the block reward and related transaction fees is determined by the proportion of hash power we contribute toward the pool as a whole. The block reward is pre-determined and hard coded into the protocol governing the relevant blockchain, while the transaction fees are the aggregate fees paid by parties whose transactions are included in the block. In 2023, transaction fees represented approximately 6% of our Bitcoin mining revenue. Over time, as the block reward decreases (including as a result of block reward halving events) transaction fees will become a larger proportion of our revenue. The block reward and transaction fees are paid in-kind in the native digital currency of the blockchain.

Power and hosting costs

Direct costs of mining revenue are comprised of power costs and the fees we pay to third parties to host, operate and maintain our mining machines.

Power credits

The hosting agreement with Galaxy allows Argo to share in the proceeds from economic curtailment, which occurs when Helios monetizes its fixed-price PPA during periods of high power prices.

Change in fair value of digital currencies and realized loss on sale of digital currencies

In all periods presented, we have mined cryptocurrency and sold portions of the cryptocurrencies mined in exchange for fiat currency to fund our operating expenses. As such, we were mining to sell, and the cryptocurrency we earned from mining was recorded as a current asset on our balance sheet. Change in fair value of digital currencies consists of the net change in the value of cryptocurrency assets held in treasury due to fluctuations in the market of those assets. In each of the periods presented, cryptocurrency held in treasury was marked to market at either the date on which such currency was disposed or, if not disposed, at the end of such period, with gains and losses reflected as change in fair value of digital currencies or realized loss on sale of digital currencies in our income statement. In recent periods, these fluctuations have materially affected our operating results and we expect this to continue for the foreseeable future.

Depreciation of mining equipment

We capitalize the cost of our mining machines and record depreciation expense on a straight-line basis over the estimated useful life of the machines, which is generally 36 to 48 months.

Operating expenses

General and administrative expenses represent salary and other employee costs, restructuring costs, insurance fees, non-mining depreciation and amortization, legal and professional fees, regulatory fees, consulting fees, foreign exchange gains and losses, and other expenses.

Income tax expense

We are liable to pay tax in a number of jurisdictions, including the United Kingdom, Canada and the United States. Our effective tax rate represents the weighted average of the tax rates for which we are liable in those jurisdictions. We did not occur any income tax expense in any of the jurisdictions that we operate.

Results of Operations

The following table sets forth our results of operations for the years ended December 31, 2023, 2022 and 2021:

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Comparison of the years ended December 31, 2023 and 2022 (in ‘000’s)

Total revenue

Total revenue decreased by $8,026 to $50,558 for the year ended December 31, 2023 from $58,583 for the year ended December 31, 2022. This decrease was primarily driven by the increase in the global network hashrate and the associated 71% increase in average network difficulty in 2023 compared to 2022, which resulted in a 40% decrease in hashprice. In 2023 we mined 1,760 bitcoin and realized $28,723 per bitcoin as compared to 2,156 and $27,117 in 2022, respectively.

Power and hosting costs

Power and hosting costs increased by $9,205 to $35,964 for the year ended December 31, 2023 from $26,759 for the year ended December 31, 2022. This increase was primarily driven by higher power and hosting costs in Texas due to a full year’s production at in 2023 compared to a partial year of production in 2022.

Power credits

The hosting agreement with Galaxy allows Argo to share in the proceeds from economic curtailment, which occurs when Helios monetizes its fixed-price PPA during periods of high power prices. During the year, Argo generated approximately $7.2 million in power credits, with $3.8 million generated in the month of August during a state-wide heat wave. Not only does the ability to curtail operations benefit Argo economically, but it greatly enhances the stability of the Texas grid.

Depreciation of mining equipment

Depreciation of mining equipment decreased by $1,813 to $18,656 for the year ended December 31, 2023 from $20,469 for the year ended December 31, 2022. This decrease was primarily driven by the lower book value of our machines in 2023 after accounting for impairments in 2022, partially offset by new mining machines energized in 2023.

Operating expenses

Operating expenses decreased by $15,029 to $18,949 for the year ended December 31, 2023 from $34,057 for the year ended December 31, 2022. Note 8 of our consolidated financial statements details our operating expenses for 2023 and 2022. The decrease over 2022 was primarily driven by the sale of the Helios facility in December 2022, which significantly decreased the Company’s headcount and salary costs, and reduced other non-mining operating expenses such as restructuring costs, depreciation and amortization, and insurance fees.

Share based payment

Share based payment decreased to $3,892 for the year ended December 31, 2023 from $6,096 for the year ended December 31, 2022. This decrease was driven by the large number of options that lapsed early in 2023 with the reduction in work force and the higher share price associated with options granted in 2021 and 2022 as compared to the restricted and performance share units granted in 2023.

Interest expense

Interest expense decreased by $11,105 to $11,556 for the year ended December 31, 2023 from $22,661 for the year ended December 31, 2022. This decrease was primarily driven by the significant reduction of debt that occurred in conjunction with the sale of the Helios facility to Galaxy in December 2022.

Comparison of the years ended December 31, 2022 and 2021 (in ‘000’s)

Total revenue

Total revenue decreased by $40,165 to $58,583 for the year ended December 31, 2022 from $98,748 for the year ended December 31, 2021. This decrease was primarily driven by the overall decrease in the price of Bitcoin (average for Q4 2021 of $54,804 per Bitcoin and average of Q4 2022 of $18,066).

Power and hosting costs

Power costs increased by $11,574 to $26,759 for the year ended December 31, 2022 from $15,185 for the year ended December 31, 2021. This increase was primarily driven by higher power costs in Texas due to the opening of the Helios facility during 2022.

Depreciation of mining equipment

Depreciation of mining equipment increased by $6,130 to $20,469 for the year ended December 31, 2022 from $14,339 for the year ended December 31, 2021. This increase was primarily driven by continued investment in the expansion of our mining fleet and the resulting depreciation of those capital investments.

Operating expenses

Operating expenses increased by $22,314 to $34,057 for the year ended December 31, 2022 from $11,743 for the year ended December 31, 2021. This increase was primarily driven by increased salary costs and other non-mining operating expenses such as insurance and depreciation and amortization as the Group energized its Helios facility. Operating expenses such as legal and directors and officers insurance also increased as a result of operating as a public company listed in the U.S.

Share based payment

Share based payment increased to $6,096 for the year ended December 31, 2022 from $2,579 for the year ended December 31, 2021. This increase was driven by the increase in options granted during the year, the increase in share price, and the material nature of the charge calculated thereon.

Interest expense

Interest expense increased by $19,726 to $22,661 for the year ended December 31, 2022 from $2,935 for the year ended December 31, 2021. This increase was primarily driven by the lease costs related to the S19 and S19 Pro machine purchase where payment began in January 2021, interest on the Galaxy Term Loan, bond interest, and interest resulting from prepaying loans during the year.

B.    Liquidity and Capital Resources

Since our inception, we have financed our operations primarily through cash generated by sales of cryptocurrency, sales of equity securities, issuing bonds and incurring debt. In 2022, the rapid decline in Bitcoin price adversely affected our revenue, financial condition and operating results, and required us to divest a substantial portion of our Bitcoin as well as our Helios mining facility in Texas in order to meet operating expenses and avoid default under our credit facilities. In 2023, Bitcoin mining economics improved, allowing us to significantly reduce our debt, deploy additional hashrate capacity in Quebec, and strengthen our balance sheet. Our primary requirements for liquidity and capital are to finance working capital, capital expenditures and general corporate purposes. We believe that our sources of liquidity and capital resources will be sufficient to meet our existing business needs for at least the next 12 months. However, our recurring losses from operations, our debt service obligations, and the volatility in Bitcoin prices do raise substantial doubt about our ability to continue as a going concern. As a result, management has included disclosures in Note 3 of the financial statements and our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements for the year ended December 31, 2023 with respect to this uncertainty. From time to time, we may raise additional capital through the issuance of debt or equity securities or additional borrowings to the extent required, or to the extent that we believe such capital is available on favorable terms. Our primary sources of liquidity are our cash and cash equivalents and cryptocurrency held in treasury.

During the course of 2023, our treasury management strategy was to sell our mined cryptocurrency assets on a weekly basis in order to fund our operating expenses and for working capital needs. In the future, as with any business which mines a commodity, we expect to sell Bitcoin to satisfy our fiat cash requirements.

In March 2022, we entered into an equipment financing agreement (the “Financing Agreement”) with NYDIG, a wholly owned subsidiary of New York Digital Investment Group LLC. As part of the Financing Agreement, NYDIG loaned Argo an aggregate principal amount of $27 million to recapitalize the purchase of electrical infrastructure equipment for the Helios facility in Dickens County, Texas. Outstanding borrowings under the Financing Agreement were secured by the infrastructure financed equipment and the contracts to acquire the infrastructure financed equipment. In April 2022, we entered into additional equipment financing with NYDIG under which NYDIG agreed to loan to Argo, in a series of loans from April to September 2022, an aggregate principal amount of up to $71 million to recapitalize the purchase of digital asset mining equipment for the Helios facility. Additional borrowings under the Financing Agreement were secured by the mining financed equipment and the contracts to acquire the mining financed equipment. The equipment financing agreements entered into with NYDIG were repaid in full in December 2022.

On December 28, 2022, we announced a series of transactions with Galaxy that strengthened our balance sheet, improved our liquidity position, and enabled us to continue mining operations. As part of the transactions, we sold the Helios facility and real property in Dickens County, Texas to Galaxy for $65 million and refinanced existing asset-backed loans via a new $35 million, three-year asset-backed loan with Galaxy (the “Galaxy ABS Loan”). The Galaxy ABS Loan also includes events of default, which are customary for facilities of this type (with customary grace periods, as applicable), including provisions under which, upon the occurrence of an event of default, all amounts outstanding under the Galaxy ABS Loan may be accelerated. The Galaxy ABS Loan contains usual and customary limitations on indebtedness, liens, restricted payments, acquisitions and asset sales in the form of affirmative, negative and financial covenants, which are customary for financings of this type. The Galaxy ABS Loan is secured by a collateral package that includes 23,619 Bitmain S19J Pro mining machines currently operating at the Helios facility and certain machines located at Argo’s Canadian data centers. The term of the Galaxy ABS Loan is 18 months with an option to extend for another 18 months if certain financial thresholds are met. The interest rate is SOFR plus 11% with a 1.5% renewal fee in the event the maturity is extended. The cash proceeds received from the sale of the Helios facility, along with a portion of the borrowings under the Galaxy ABS Loan, were used to repay all existing indebtedness, prepayment interest, and other fees of approximately $84 million owed to NYDIG and other existing indebtedness. The transactions reduced total indebtedness by $41 million and allowed us to simplify our operating structure.

On July 19, 2023, the Company raised $7.5 million of gross proceeds via a non-preemptive placing of 57,500,000 new ordinary shares to both institutional and retail investors in the UK. The proceeds were used for general corporate purposes and to repay a portion of the Galaxy ABS Loan.

On January 8, 2024, the Company raised $9.9 million of gross proceeds via a non-preemptive placing of 38,064,000 new ordinary shares to institutional investors in the UK. The proceeds were used for general corporate purposes and to repay a portion of the Galaxy ABS Loan.

At any time and from time to time, we may repay or redeem our outstanding debt, including purchases of our outstanding bonds in the open market, through privately negotiated transactions or a combination thereof, in each case using cash and cash equivalents, cash from our short-term investments, cash from operating activities, proceeds from the issuance of debt or equity or proceeds from asset divestitures. Any repayment or redemption of our debt will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. In connection with such repurchases or redemptions, we may incur cash and non-cash charges, which could be material in the period in which they are incurred.

The following table summarizes our contractual obligations and other commitments (in thousands) as of December 31, 2023, and the years in which these obligations are due:

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During the periods presented, we did not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Cash Flows

The table below summarizes our cash flows for the periods presented:

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Operating Activities

Net cash used in operating activities of $47,956 in the year ended December 31, 2023 was comprised of our net loss before tax of $34,637 and working capital changes, reduced by non-cash addbacks for finance costs, impairments, depreciation, foreign exchange and investment write offs.

Net cash used in operating activities of $101,237 in the year ended December 31, 2022 was comprised of our net loss before tax of $240,692 and working capital changes, reduced by non-cash addbacks for impairments, loss on sale of subsidiary, foreign exchange and digital currency revaluations.

Net cash used in operating activities of $37,019 in the year ended December 31, 2021 was comprised of our operating profit of $53,067, reduced by working capital changes.

Investing Activities

Net cash generated from investing activities in the year ended December 31, 2023 was $50,804, which was comprised principally $1,112 for the purchase of tangible fixed assets.

Net cash generated from investing activities in the year ended December 31, 2022 was $17,325, which was comprised principally of $108 million for the purchase of tangible fixed assets and $12.4 million for the disposal of tangible fixed assets.

Net cash used in investing activities in the year ended December 31, 2021 was $183,066, which was comprised principally of $105.1 million for purchase of mining machines and build out of the Helios facility and $63.1 million in mining equipment prepayment.

Financing Activities

Net cash used in financing activities in the year ended December 31, 2023 was $15,778, which was comprised principally of $14,064 of loan repayments and $10,661 of interest payments, partially offset by $7,518 of proceeds from shares issued.

Net cash generated from financing activities in the year ended December 31, 2022 was $84,177 which was comprised principally of $106,931 in loan proceeds partially offset by $22,661 in interest costs.

Net cash generated from financing activities in the year ended December 31, 2021 was $233,062 and was comprised principally of $179.2 million of proceeds from shares issued and $35.8 million in loan proceeds.

Capital Expenditures

Historically, our capital expenditures have consisted primarily of purchasing mining machines and computer equipment and improvements to the mining facilities in which we operate. Our capital expenditures during the year ended December 31, 2020 were principally for purchasing mining machines. Beginning in 2021 and continuing into 2022, in addition to the acquisition of mining machines, our capital expenditures expanded to include acquiring and building mining facilities that we planned to own and operate. Our capital expenditures including mining machine prepayments, net of disposals, were $168.2 million, $95.6 million, and $1.1 million in 2021, 2022 and 2023, respectively.

C.    Research and development, patents and licenses, etc.

We have developed and may continue to research and develop certain proprietary technologies for purposes of optimizing and enhancing our cryptocurrency mining operations. Research and development have not been significant components of our business and have been immaterial to our financial condition and results of operations, however such activities may become more significant in the future.

D.    Trend Information

Please refer to our disclosures set forth under Item 3.D “Risk Factors,” Item 4 “Information on the Company,” and elsewhere in this Item 5 “Operating and Financial Review and Prospects” for information regarding the material risks, business developments and strategies, factors, and trends that are most likely to affect our business and results of operations through 2024.

E.    Critical Accounting Estimates

Not applicable.

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Item 15.    Controls and Procedures

Disclosure Controls and Procedures

As required by Rule 13a-15 or 15d-15 under the Exchange Act, we have carried out an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Annual Report, that being as at December 31, 2023. This evaluation was carried out by our Chief Executive Officer (“CEO”) and our Chief Financial Officer (“CFO”). Based upon that evaluation, our CEO and CFO concluded that the Company’s disclosure controls and procedures were effective as of December 31, 2023.

It should be noted that while our CEO and CFO believed that the Company’s disclosure controls and procedures provided a reasonable level of assurance that they are effective, they did not expect that the Company’s disclosure controls and procedures would prevent all errors and fraud. A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

In connection with the preparation of this Amendment No.1, our management, including our CEO and CFO, re-evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2023. This re-evaluation was conducted after the identification of a material weakness in internal control over financial reporting, as discussed below.

As a result of this reassessment, our CEO and CFO concluded that our disclosure controls and procedures were not effective as of December 31, 2023, due to the existence of a material weakness in our accounting for mined cryptocurrencies, which resulted in a restatement of prior financial statements.

Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Exchange Act Rules 13a-15(f) and 15d-15(f) define internal control over financial reporting as a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with (a) UK-adopted International Accounting Standards; and (b) International Financial Reporting Standards (“IFRS”), including interpretations issued by the IFRS Interpretations Committee.

In connection with the preparation of the Original Filing, under the supervision and with the participation of our CEO and CFO, management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023. In making this assessment, management used the criteria, established in the 2013 Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based upon that assessment, at the time the Original Filing was filed, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 2023. Subsequent to that assessment, our management, including our CEO and CFO, conducted a re-assessment and concluded that our internal control over financial reporting was ineffective as of December 31, 2023, due to the material weakness identified below.

Identified Material Weakness

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

During our re-assessment, we identified a material weakness in our accounting for mined cryptocurrencies. We accounted for these assets as inventory, when they should have been accounted for as intangible assets. The impact to the balance sheet is a change in the description of the asset from digital assets to intangible assets. The impact to the income statement is a reclassification of the change in fair value to impairment in intangible assets/ intangible fixed assets. The impact to the cash flow statement is reclassification between operating cash flow and investing cash flow.This accounting error resulted in a restatement of our consolidated financial statements for the fiscal years ended December 31, 2023, 2022, and 2021.

The material weakness was attributable to inadequate technical review over our accounting policy for mined cryptocurrencies. As a result, we have concluded that our internal control over financial reporting and disclosure controls and procedures were not effective as of December 31, 2023.

Management’s Plan to Remediate the Identified Material Weakness

The above-described material weakness has been remediated as of the filing of this Amendment No. 1. Since identifying this material weakness, management, with oversight from the Audit Committee, has implemented and continues to implement enhanced internal control procedures, including:

Attestation Report of the Registered Public Accounting Firm

This Annual Report does not include an attestation report from our registered public accounting firm regarding internal control over financial reporting. Management’s report is not subject to auditor attestation, as the SEC permits the Company to provide only management’s report in this filing.

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Changes in Internal Control Over Financial Reporting

Other than the material weakness and remediation plan discussed above, during the period ended December 31, 2023, there were no other changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Clawback Policy Disclosure

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Item 18.    Financial Statements

The audited restated consolidated financial statements as required under Item 18 are attached hereto starting on page F-1 of this Amendment No. 1.

Item 19.    Exhibits

A list of exhibits included as part of this Annual Report is set forth in the Index to Exhibit immediately following this Item 19.

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INDEX TO EXHIBITS

* Filed herewith.

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# Portions of the exhibit have been or will be excluded because it is both not material and is the type of information that the registrant treats as private or confidential.

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SIGNATURE

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and has duly caused and authorized the undersigned to sign this Amendment No. 1 on Form 20-F/A on its behalf.

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INDEX TO RESTATED CONSOLIDATED FINANCIAL STATEMENTS

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Argo Blockchain plc

Opinion on the Financial Statements

We have audited the accompanying group statements of financial position of Argo Blockchain plc and its subsidiaries (the “Group”) as of December 31, 2023 and 2022, and the group statements of comprehensive income, group statements of cash flows and group statements of changes in equity for each of the three years ended December 31, 2023, 2022 and 2021, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years ended December 31, 2023, 2022 and 2021, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

Going concern uncertainty

We draw attention to note 3 in the financial statements, which indicates that due to the group’s debt service obligations and the exposure to Bitcoin, power and hashprice price which have shown significant volatility over recent years, resulting in a current loss recorded for the year. In addition to this, the group needs to raise further funding during the assessment period, in order to meet liabilities as they fall due for the foreseeable future. As stated in note 3, these events or conditions, along with the other matters as set forth in note 3, raise substantial doubt about the Group’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

In auditing the financial statements, we have concluded that the director’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’ assessment of the group’s and parent company’s ability to continue to adopt the going concern basis of accounting included a review of management’s cash flow forecasts to June 2025, along with an assessment of the “downside case” forecast as well as its likelihood. The audit team performed sensitivity analysis on the hashprice applied throughout the assessment period and the refinancing of the debt position. We have reviewed all key inputs into the cash flow forecasts, with particular emphasis on those areas of judgement and estimation uncertainty such as the hashprice, power costs, loan repayments and hashpower, and ensured they are appropriate and no evidence of management bias exists.

Basis for opinion

These consolidated financial statements are the responsibility of the Group’s management. Our responsibility is to express an opinion on the Group’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Group is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical audit matters

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters do not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, in addition to the going concern uncertainty, providing a separate opinion on the critical audit matters or on the accounts or disclosures to which they relate.

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Restatement of Previously Issued Financial Statements

As discussed in Note 2 to the consolidated financial statements, the December 31, 2023, 2022 and 2021 consolidated financial statements have been restated to correct a misstatement.

/s/ PKF Littlejohn LLP

We have served as the Company’s auditor since 2019.

London, England

Date: 30/04/2024, except for the effects of the restatement as discussed in Note 2 to the consolidated financial statements, as to which the date is 22/04/2025.

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GROUP STATEMENT OF COMPREHENSIVE INCOME (RESTATED)