Soluna Holdings, Inc. · NASDAQ:SLNH
Soluna — Q3 2022 Earnings Presentation
55 slides from Soluna's earnings presentation, Nov 15, 2022
Slide 1: Update on Financial Results
SOLUNS | S$ LUN
Slide 2: Preamble
Preamble > > The following discussion is completely qualified by the legal disclosures on the several pages following this one Our goalis to share with you some of our strategic thinking and financial analysis we are using to guide the growth of our business The discussion is in line with our princi
Slide 3: Legal Disclosure & Disclaimer
Legal Disclosure & Disclaimer This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act that reflect our current views with respect to, among other things, our operations, business strategy, interpretation of prior development activities
Slide 4: Legal Disclosure & Disclaimer
Legal Disclosure & Disclaimer The material in this presentation has been prepared by Soluna and is general background information about Soluna’s activities, current as at the date of this presentation and is provided for information purposes only. It should be read in conjunction with Soluna’s perio
Slide 5: Legal Disclosure & Disclaimer
Legal Disclosure & Disclaimer Use of Projections and Illustrations This presentation contains certain financial forecasts and illustrations. Neither Soluna’s [nor Soluna Holdings] independent auditors have studied, reviewed, compiled or performed any procedures with respect to the projections for th
Slide 6: Key Operating Principles
Key Operating Principles Alignment of Interests & Transparency Private equity firm owns 21%!) High Velocity Execution Senior Brookstone personnel involved in active executive capacity Focus on Return of Invested Capital (ROIC) & Capital Discipline aK Me Long-Term Strategy Beyond Crypto (1) Calculate
Slide 7: Excess energy from renewable sources
Excess energy from renewable sources We buy curtailed energy from renewable power plants and convert it to clean, low-cost global computing. Batch-oriented Computing Uke cryptocurrency mining
Slide 8: The $10B opportunity beyond crypto
The $10B°2 opportunity “a beyond crypto is $408 2 ‘ ‘i Scientific researen
Slide 9: Slide 9
Slide 10: Update on the Quarter
Update on the Quarter BTC equivalent mined and average proprietary hashrate deployed continued to grow - BTC equivalent +12.4% sequential growth — Average hashrate +5.1% sequential growth Markets remained challenged — Revenue decreased 26.6% sequentially beating average BTC prices in the quarter whi
Slide 11: Q3 Update — Continued growth demonstrates significant investment
Q3 Update — Continued growth demonstrates significant investment BTC Equivalent Mined 300 267 224 143 | Q2 2021 Q32021 Q42021 Q12022 Q22022 Q32022 + +5.4x year-over-year and 12.4% sequentially * Continued optimization of miner configurations and replacement of older machines with higher performance
Slide 12: Challenged Market - Soluna outperformed BTC and hashprice declines
Challenged Market - Soluna outperformed BTC and hashprice declines Percent Decline -26.6% 7.7% Relative { 8.1% Relative Outperformance Outperformance -34.3% -34.7% Soluna Q3 Revenue Luxor Hashprice Index Avg. BTC Price Decline
Slide 13: Q3 Update — Revenue declines versus Q2 but increases 2.7x year over year
13 Q3 Update —- Revenue declines versus Q2 but increases by 2.7x Year over year Consolidated Revenue (Non-GAAP)* ($ in ’000s) * Third quarter revenue increased 2.7x 9,264 year-over-year 8,676 7,990 + Revenue decreased 26.6% sequentially 6,372 . despite average BTC prices over the quarter decreasing
Slide 14: Q3 Update - Increased loss largely driven by one-time non-cash items
Q3 Update - Increased loss largely driven by significant one-time non-cash items Consolidated Net Income ($ in 000s) —_—_— ; -8,906 -6,557 -55,892 Q22021 Q32021 Q42021 Q12022 Q22022 Q32022 Outsized net income loss largely driven by non-cash charges Challenged markets paired with Dorothy ERCOT delays
Slide 15: Q3 Update - Breaking Down the Loss
Q3 Update - Breaking Down the Loss (S in 000s) (Unaudited) Consolidated Net Income (Loss) (GAAP) ($56,143) . Interest (GAAP) 1,671 Income tax (benefit) expense (GAAP) (547) Depreciation & amortization (GAAP) 8,388 EBITDA (Non-GAAP) Adjustments: Non-cash items ($46,631) is Stock-based compensation co
Slide 16: Q3 Update — Unit Economics Remained Healthy
Q3 Update —- Unit Economics Remained Healthy Consolidated Adj. Cash Contribution Margin Excl. One-Time Events ($ in ‘000s) $5,179 $5,206 $5,005 1,704 I - i i i. - = 2021 = 2021 = Q42021 Q12022 Q22022 Q32022 * Contribution margins remained healthy despite challenged markets * 19% consolidated cash co
Slide 17: Illustrative Dorothy Earnings Potential
Illustrative Dorothy Earnings Potential S19s Illustrative Monthly P&L ($ in ‘000s) Dorothy 1A 25MW Dorothy 1B 25MW Spring Lane (32% Owner) 100% Owner 100% Hosting 50% / 50% 100% Prop 100% Hosting 50% / 50% 100% Prop Cash Inflows 1,105 1,206 1,306 1,105 1,206 1,306 (-) Power Costs (641) (641) (641) (
Slide 18: Illustrative Dorothy Earnings Potential
Illustrative Dorothy Earnings Potential XPs Illustrative Monthly P&L ($ in ‘000s) Dorothy 1A 25MW Dorothy 1B 25MW Spring Lane (32% Owner) 100% Owner 100% Hosting 50% / 50% 100% Prop 100% Hosting 50% / 50% 100% Prop Cash Inflows 1,098 1,433 1,767 1,098 1,433 1,767 (-) Power Costs (641) (641) (641) (6
Slide 19: G&A Breakdown
G&A Breakdown Key Contributing Costs to G&A, excluding depreciation and amortization ($ in ‘000s) 2s) | P09] Ea Directors & Complex Officers and 1,160 i , Transactions, General Non-cash including Insurance 604 Complex Dorothy Related to bisaw sat 1,321 New Hires Dorothy and : Convert 29 New Amendmen
Slide 20: Facility Results Review
Facility Results Review > We will review each facility > Then look at the consolidated results lf
Slide 21: Sophie: Non-GAAP Historical Financials
Sophie: Non-GAAP Historical Financials ($ in 000s) (Unaudited) ch Actual | Actual | Actual Actual Actual Q421 | FY21 | Q122 | Apr22 May22 Jun22 | Q222 | Jul22 Aug22 Sep22 | Q322 Revenue 2772 | 2772 | 3808 | 1634 1310 1077 | 4022 | 1099 1176 895 | 3,170 Electricity/Direct Costs* 884 884 | 1546 | 325
Slide 22: Marie: Non-GAAP Historical Financials
Marie: Non-GAAP Historical Financials) (Sin 000s) (Unaudited) Revenue (Non-GAap) Prop Mining Hosting Electricity/Direct Costs* Prop Mining Hosting Overhead Costs Prop Mining Hosting Adjusted Cost of Cryptocurrency Revenue 2** (won-GAap) Prop Mining Hosting Cash Contribution Margin (ion-caar) Prop Mi
Slide 23: Marie: Operating Metrics
Marie: Operating Metrics!) ww Key Operating Metrics: Q2 21% | Q3 217 | Qa 21% | FY 21 [Q122] Apr22 May22 _Jun22 [Q2z22%] Jul22 Aug22 Sep 22 | Q3227 ‘Avg. MW Deployed 158 | 309 | 1064 | 746 | 1588 | 1459 1920 1791 | 1723 | 1809 1756 1849 | 1805 Prop Mining 158 176 | 314 | 216 | 7.62 770 1048 1000 | 9
Slide 24: Consolidated Soluna Computing Non-GAAP Historical Financials
Consolidated Soluna Computing Non-GAAP Historical Financials) Excludes ~$276k of power costs which are passed directly to hosting customer (S in 000s) (Unaudited) Actual | Actual | Actual | Actual ) Actual Actual : Actual 221 | g321 | qa2a | Fy21 | Qi22 | Apr22 May22 Jun22 | Q222 | Jul22 Aug22 | Q3.
Slide 25: Consolidated Soluna Computing Operating Metrics
Consolidated Soluna Computing Operating Metrics) Key Operating Metrics: Q2 21 | 93 217 | ga 21% | Fy 21 | Q122" | Apr22 May22 Jun22 [Q222] jul22 Aug22 Sep 22 [ Q3 227 ‘Avg. MW Deployed 334 495 | 1980 | 933 | 3117 | 3148 3654 3421 | 3407 | 3578 3515 3577 | 3557 Prop Mining 334 352 | 1230 | 639 | 2290
Slide 26: Reconciliation of non-GAAP results of operations to the nearest comparable GAAP measures
Reconciliation of non-GAAP results of operations to the nearest comparable GAAP measures D
Slide 27: 2022 Q3 GAAP Revenue to Non-GAAP Revenue
2022 Q3 - Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue (S in 000s) (Unaudited) Cryptocurrency revenue (GAAP) less Legacy Hosting Revenue Revenue (Non-GAAP) Q3 2022 Soluna Computing Edith Marie Sophie Dorothy Total $226 $2,977 $3,170 $o $6,372 0 0) 0 0 (0) $
Slide 28: 2022 Q3 Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP)
2022 Q3 - Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q3 2022 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Dorothy Total Cryptocurrency revenue (GAAP) $226 $2,977 $3,170 so $6,372 Cost of cryptocurrency r
Slide 29: 2022 Q3 - Reconciliation Of Non-GAAP Results
2022 Q3 - Reconciliation Of Non-GAAP Results Contribution Margin & Cash Contribution Margin (Non-GAAP) ($ in 000s) (Unaudited) Cryptocurrency revenue (GAAP) Cost of cryptocurrency revenue (GAAP) Depreciation Project Equipment Repairs Contribution Margin (Non-GAAP)* plus Prepaid Lease Cost plus Legac
Slide 30: 2022 Q3 - Reconciliation Of Non-GAAP Results
2022 Q3 - Reconciliation Of Non-GAAP Results Reconciliation of Non-GAAP Results Reconciliation from Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP) Q3 2022 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Dorothy Corporate Total Corporate _| Consolidated Net Income (Los
Slide 31: 2022 Q2 GAAP Revenue to Non-GAAP Revenue
2022 Q2 - Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue (S in 000s) (Unaudited) Cryptocurrency revenue (GAAP) less Legacy Hosting Revenue Revenue (Non-GAAP) Q2 2022 Soluna Computing Edith Marie Sophie Dorothy Corporate} Total $418 $4,236 $4,022 $0 $o $8,676
Slide 32: 2022 Q2 Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP)
2022 Q2 - Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q2 2022 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Dorothy Corporate| Total Cryptocurrency revenue (GAAP) $418 $4,236 $4,022 $o $0 $8,676 Cost of cr
Slide 33: 2022 Q2 - Reconciliation Of Non-GAAP Results
2022 Q2 - Reconciliation Of Non-GAAP Results Reconcilation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin Q2 2022 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Dorothy Corporate| Total Cryptocurrency revenue (GAAP) $418 $4,236 $4,022 so $0 $8,676 Cos
Slide 34: 2022 Q2 Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP)
2022 Q2 - Reconciliation Of Non-GAAP Results Reconciliation from Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP) Q2 2022 Soluna Computing Edith Marie Sophie Dorothy Corporate Total Corporate Consolidated Net Income (Loss) (GAAP) $34 ($2,900) ($849) $139 ($4,932) ($8,509) ($5,595)
Slide 35: 2022 Q1 GAAP Revenue to Non-GAAP Revenue
2022 Q1 - Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue Qi 2022 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $517 $4,991 $3,808 $o $9,316 less Legacy Hosting Revenue 0 52 0 0 ay Revenue (Non-GAAP)
Slide 36: 2022 Q1 Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP)
2022 Q1 - Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q1 2022 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $517 $4,991 $3,808 $o $9,316 Cost of cryptocurrency
Slide 37: 2022 Q1 Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin
2022 Q1 - Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin Q1 2022 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $517 $4,991 $3,808 $o $9,316 Cost of crypto
Slide 38: 2022 Q1 Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP)
2022 Q1 - Reconciliation Of Non-GAAP Results Reconciliation from Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP) Q1 2022 Soluna Computing Edith Marie Sophie Dorothy Corporate Total Corporate | Consolidated Net Income (Loss) (GAAP) $217 ($46) ($172) ($351) ($3,473) ($3,825) ($5,307
Slide 39: 2021 FY GAAP Revenue to Non-GAAP Revenue
2021 FY - Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue (S in 000s) (Unaudited) Cryptocurrency revenue (GAAP) less Legacy Hosting Revenue Revenue (Non-GAAP) FY 2021 Soluna Computing Edith Marie Sophie Corporate Total $3,648 $7,925 $2,772 $o $14,345 0 1,335 0
Slide 40: 2021 FY Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP)
2021 FY - Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) FY 2021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $3,648 $7,925 $2,772 $0 $14,345 Cost of cryptocurre
Slide 41: 2021 FY Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin
2021 FY - Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin (Non-GAAP) FY 2021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $3,648 $7,925 $2,772 $o $14,345
Slide 42: 2021 FY Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP)
2021 FY - Reconciliation Of Non-GAAP Results Reconciliation from Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP) Net Income (Loss) (GAAP) Interest (GAAP) Income tax (benefit) expense (GAAP) Depreciation & amortization (GAAP) Stock-based compensation costs Exchange registration exp
Slide 43: 2021 Q4 GAAP Revenue to Non-GAAP Revenue
2021 Q4 - Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue Q4 2021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $864 $4,933 $2,772 0) $8,569 less Legacy Hosting Revenue 0 579 0 0 579) Revenue (Non-GAA
Slide 44: 2021 Q4 Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP)
2021 Q4 - Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) Q4 2021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $864 $4,933 $2,772 $0 $8,569 Cost of cryptocurrency
Slide 45: 2021 Q4 Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin
2021 Q4 - Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin (Non-GAAP) Q42021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total Cryptocurrency revenue (GAAP) $864 $4,933 $2,772 $o $8,569 Cost
Slide 46: 2021 Q4 Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP)
2021 Q4 - Reconciliation Of Non-GAAP Results Reconciliation from Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP) Q4 2021 Soluna Computing Edith Marie Sophie Dorothy Corporate Total Corporate Consolidated Net Income (Loss) (GAAP) $478 $1,585 $938 ($89) ($2,842) $70 ($3,507) ($3,437
Slide 47: 2021 Q3 GAAP Revenue to Non-GAAP Revenue
2021 Q3 - Reconciliation Of Non-GAAP Results Reconciliation from GAAP Revenue to Non-GAAP Revenue Q3 2021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTII Corporate |Consolidated Product revenue (GAAP) $o $o so $o $o $1,949 $o $1,949 Cryptocurrency revenue (GAAP) $905
Slide 48: 2021 Q3 Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP)
2021 Q3 - Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) ($ in 000s) (Unaudited) Product revenue (GAAP) Cryptocurrency revenue (GAAP) Cost of product revenue (GAAP) Cost of cryptocurrency revenue (GAAP): Electricity/Direct
Slide 49: 2021 Q3 Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin
2021 Q3 - Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin & Cash Contribution Margin (Non-GAAP) ($ in 000s) (Unaudited) Product revenue (GAAP) Cryptocurrency revenue (GAAP) Cost of product revenue (GAAP) Cost of cryptocurrency revenue (GAAP)
Slide 50: 2021 Q3 Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP)
2021 Q3 - Reconciliation Of Non-GAAP Results Reconciliation from Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP) Q3 2021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTIL Corporate | Consolidated Net (Loss) Income (GAAP) $581 $259 ($217) ($1,089) ($4
Slide 51: 2021 Q2 Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP)
2021 Q2 - Reconciliation Of Non-GAAP Results Reconciliation from Cost of Cryptocurrency Revenue to Adjusted Cost of Revenue (Non-GAAP) (Sin 000s) (Unaudited) Product revenue (GAAP) Cryptocurrency revenue (GAAP) Cost of product revenue (GAAP) Cost of cryptocurrency revenue (GAAP): Electricity/Direct
Slide 52: 2021 Q2 Revenue and Cost of Revenue to Contribution Margin (Non-GAAP)
2021 Q2 - Reconciliation Of Non-GAAP Results Reconciliation from Revenue and Cost of Revenue to Contribution Margin (Non-GAAP) Q2 2021 (S in 000s) (Unaudited) Soluna Computing Edith Marie Sophie Corporate Total MTIl Corporate |Consolidated| Product revenue (GAAP) $0 $0 $0 $0 $0 $1,647 $o $1,647 Cryp
Slide 53: 2021 Q2 Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP)
2021 Q2 - Reconciliation Of Non-GAAP Results Reconciliation from Operating (Loss) Income to Adjusted EBITDA Contribution (Non-GAAP) (Sin 000s) (Unaudited) Net (Loss) Income (GAAP) Other Income (Expense) Interest (GAAP) Depreciation (GAAP) One-time SG&A expenses Corporate Assessment Adjusted EBITDA C
Slide 54: The future of renewable energy is computing.
The future of renewable energy is computing.
Slide 55: Learn more at solunacomputing.com
“M EGAWATT Learn more at solunacomputing.com i