Terawulf Inc. · NASDAQ:WULF
Terawulf — Q2 2024 Earnings Presentation
28 slides from Terawulf's earnings presentation, Aug 12, 2024
Slide 1: Investor Update August 2024
Forward Investor Update August 2024
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT This presentation is for informational purposes only and contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities igation Reform Act of 1995, as amended. Such forward-looking statements include statements concerning antici
Slide 3: ➢ ➢ o o ➢ ➢ ➢ ➢ (1) MW available expansion capacity includes
➢ ➢ o o ➢ ➢ ➢ ➢ (1) 350 MW available expansion capacity includes planned 50 MW BTC mining expansion at Nautilus. 3
Slide 4: Rapidly scaling infrastructure and hash rate
3 MW 60 MW 60 MW 110 MW 195 MW 195 MW 245 MW 30 MW 50 MW 50 MW 50 MW 50 MW50 MW 23 MW 250 MW 50 MW 0.3 EH/s 2.0 EH/s 3.3 EH/s 5.5 EH/s 10.2 EH/s 13.3 EH/s 0.0 2.0 EH/s 4.0 EH/s 6.0 EH/s 8.0 EH/s 10.0 EH/s 12.0 EH/s 14.0 EH/s 16.0 EH/s 18.0 EH/s 20.0 EH/s 0 100 MW 200 MW 300 MW 400 MW 500 MW 600 MW 7
Slide 5: ➢ ➢ ➢ ➢ (1) Source: NYISO Power Trends 2024 report (https://www.nyiso.com/power-trends). (2) Reflects
➢ ➢ ➢ ➢ (1) Source: NYISO Power Trends 2024 report (https://www.nyiso.com/power-trends). (2) Reflects TeraWulf’s 50 MW interest in the Nautilus Cryptomine facility and option to expand by 50 MW, which the Company exercised in February 2024. 5 ➢ ➢ ➢
Slide 6: Strategically located in regions with significant energy surplus
Strategically located in regions with significant energy surplus 6 ✓ ✓ ✓ ✓ ✓ ✓
Slide 7: Low-cost producer of Bitcoin with large-scale infrastructure optionality
Low-cost producer of Bitcoin with large-scale infrastructure optionality ➢ Existing sites have access to >300 MW of capacity to expand ➢ Attractive site strategically positioned to support other forms of compute ➢ Realized $0.032/kWh all-in power cost in 2023 ➢ Target $0.035/kWh all-in power cost in
Slide 8: Free cash flow generation despite BTC reward halving in April 2024
Free cash flow generation despite BTC reward halving in April 2024 8 Metric Amount Comments End of Period Hash Rate 8.8 EH/s ➢ 80% increase year-over-year Bitcoin Self-mined 699 ➢ 7.7 BTC per day Power Cost $0.037/kWh ➢ Represents power cost per BTC of $22,954 Revenue (1) $35.6 million ➢ 130% increa
Slide 9: All figures include TeraWulf's net share of Nautilus JV
All figures include TeraWulf’s net share of Nautilus JV 9 514 889 980 959 1051 699 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 3.3 5.5 5.5 5.5 8.0 8.8 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 $8.7 $19.4 $18.7 $25.0 $40.5 $32.2 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 ($2.3) $7.6 $9
Slide 10: Hypothetical post-halving quarter for Nautilus JV interest
GAAP rules do not permit TeraWulf to consolidate its 25% interest in the Nautilus JV 10 Hypothetical Post-Halving Quarter Illustrative Market Inputs: Bitcoin Price ($/BTC) $60,000 Network Hash Rate (EH/s) 610 Illustrative Operating Inputs: WULF Hash Rate (EH/s) 1.85 WULF Power Capacity (MW) 50 Uptim
Slide 11: TeraWulf delivers more profitability with less dilution than peers
$2.9 $4.8 $8.5 $28.3 $32.1 CLSK WULF CORZ MARA RIOT $202 $2603 $745 $921 $1,062 WULF CORZ RIOT CLSK MARA TeraWulf delivers more profitability with less dilution than any of its peers 11 Source: Public filings, publicly available earnings transcripts, and good faith calculations by TeraWulf. (1) Incl
Slide 12: Strong operational performance enabled streamlined capital structure
12 ➢ $30 million of debt repayment in Q2 2024 ➢ Building 4 populated with ~10,000 S21 and S21 Pro miners ➢ Balance sheet improvement continues with $18.5 million of net working capital at end of 2Q24 $104 M ATM 2Q24 Warrants 2Q24 Operational Cash Flow 2Q24 Debt Repayment Miner Purchase Tax Withholdi
Slide 13: Foundation being built for rapid HPC/AI expansion in 2025+
Foundation being built for rapid HPC/AI expansion in 2025+ 13 (1) Actual proceeds received through August 12, 2024. (2) Estimated 2H24 cash from operations assumes average BTC price of $60,000 and network hash rate of 600 EH/s, July 1 – December 31, 2024. (3) Reflects TeraWulf’s 30% equity contribut
Slide 14: Realized cost-to-mine of ~$41.6k in Q2 2024
Realized cost-to-mine of ~$41.6k in Q2 2024; projection of ~$40k for balance of 2024 14 Q1 2024 [1] Q2 2024 [2] 2H 2024 Full Year 2024 Illustrative Market Inputs: Network Hash Rate (EH/s) 630 Transaction Fees (%) 10% Illustrative Operating Inputs: Miner Fleet Efficiency (J/TH) [3] 23.7 Total Hash Ra
Slide 15: Optimizing land, MWs and capital for long-term value creation
Optimizing LAND, MWs and CAPITAL for the most efficient long-term value creation 15 Cloud Service Provider (CSP) Colocation – Whitespace & Rack Ready Build to Suit Description Shell data center and GPU clusters; space, power, cooling, fiber/internet, security, compute, storage and environment. Shell
Slide 16: Illustrative infrastructure development timeline
16 ➢ WULF Den: 2 /2.5 MW (1) capacity (2) expected to be energized in September 2024 ➢ CB-1: 16/20 MW (1) capacity expected to be energized by YE24 (2) ➢ CB-2: 42 /50 MW (1)(2) expected to be energized in 1H25 ➢ Additional 166 /200 MW (1) capacity expected to be available 2H25 (2) ➢ Additional futur
Slide 17: Mismatch in data center demand and power growth
Significant mismatch in data center demand and power growth – increasing the value of land and power assets ➢ Electricity demand growth driven largely by GenAI and data centers significantly outpacing the expected supply growth of available power capacity ▪ This imbalance has continued to increase t
Slide 18: f
f 18
Slide 19: Accomplished, diverse management team
TeraWulf is led by an accomplished, diverse management team with 30+ years of experience in developing and managing energy infrastructure and disruptive technology N A Z A R K H A N Co-Founder, Chief Operating Officer & Chief Technology Officer 20+ years in energy infrastructure and cryptocurrency m
Slide 20: Estimated diluted shares at various share prices
As of August 12, 2024 20 Note: all figures are approximate. Estimated Diluted Shares at Various Share Prices (Based on the Treasury Method) Outstanding 4.00$ 6.00$ 8.00$ 10.00$ 12.00$ 14.00$ 16.00$ 18.00$ Common Stock 382,598 382,598 382,598 382,598 382,598 382,598 382,598 382,598 382,598 Preferred
Slide 21: Highly efficient fleet drives profitability
21 (1) Includes WULF’s net share of miners contributed to Nautilus JV. (2) Figures include 4% ancillary load, nameplate efficiency of miners alone is 27.6 J/TH for 23E, 24.6 J/TH for 2Q 24, and 22.8 for 2H 24 Model Quantity Hash Rate Efficiency J/TH S19 J/J-Pro 27,500 100 30 S19 JXP/XP 31,500 146 21
Slide 22: Annual guidance of 3.5 cents per kWh average power cost
$0.032 $0.025 $0.017 $0.031 $0.061 $0.032 $0.033 $0.040 $0.042 $0.040 2018 2019 2020 2021 2022 2023 2024E 2025E 2026E 2027E Actual Projected Average $3.5 ¢ per kWh 80% 20% Capacity (245 MW) Lake Mariner Nautilus $0.040 $0.020 Power Cost ($/kWh) Lake Mariner Nautilus Blended Power Cost (incl. Demand
Slide 23: Zero-carbon energy and quarterly energy consumption
23 (1) Source: 2024 New York ISO Load & Capacity Data Gold Book (2) Source: 2024 New York ISO Power Trends 21 GWh 93 GWh 104 GWh 103 GWh 109 GWh 105 GWh113 GWh 155 GWh 217 GWh 221 GWh 292 GWh 325 GWh Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Approximate Quarterly Energy Consumption Nautilus La
Slide 24: Lake Mariner Data
Lake Mariner Data fo) / @ Barker, NY an 100% Owners! Long-Term , 500 MW of Lease A) Infrastructure Capacity f 91%+ Zero-Carbon (Predominantly Hydro Power) Sy Y 195 MW Operational % y 50 MW Under Construction S ¥Y Target of 240 MW Deployed in 2024 G v¥ Target of 500 MW Deployed in 2025 ©) @rTerawutr
Slide 25: Nautilus Cryptomine
Nautilus Cryptomine Berwick, PA aE 25% JV with ) Talen Energy Long-Term \. 100 MW of | Lease Infrastructure Capacity e 100% Zero-Carbon Nuclear Power Z y¥ 50 MW Operational q vy 50 MW Planned Expansion in 2025 @teRawutr
Slide 26: Statements of operations
26 Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Revenue $ 35,574 $ 15,456 $ 78,007 $ 26,989 Cost of revenue (exclusive of depreciation shown below) 13,918 5,113 28,326 10,115 Gross profit 21,656 10,343 49,681 16,874 Cost of operations: Operating expenses 797 468 1,582 77
Slide 27: Q2 2024 Balance Sheet
Q2 2024 Balance Sheet June 30,2028 __December 31,2023 (unaudited) ‘ASSETS (CURRENT ASSETS: ‘cash and cash equivalents Ss 104.109s 54439 Digital curency 948 1.801 Prepaid expenses 2850 450 Other receivables 2558 44001 Other curent assets 505 306 ‘ota curent assets Toes wiser Eaquty in net assets of n
Slide 28: Adjusted EBITDA note
28 Note: The Company presents adjusted EBITDA, which is not a measurement of financial performance under generally accepted accounting principles in the United States (“GAAP”). We use Adjusted EBITDA to eliminate the effects of certain non- cash and/or non-recurring items, that do not reflect our on