Business
Bitcoin : Annual Report/ Financial Statements 2023
Bitcoin : Annual Report/ Financial Statements
About this update from Bitcoin Group Se
ANNUAL REPORT 2023 CONTENTS 01 02 LETTER TO SHAREHOLDERS 5 GROUP MANAGEMENT REPORT 19 03 CONSOLIDATED FINANCIAL STATEMENTS 33 4 01 LETTER TO SHAREHOLDERS BITCOIN GROUP SE AT A GLANCE 6 FOREWORD BY THE MANAGEMENT BOARD 7 THE BITCOIN GROUP SE ON THE CAPITAL MARKET 11 REPORT OF THE SUPERVISORY BOARD 15 5 ANNUAL REPORT 2023 LETTER TO SHAREHOLDERS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS BITCOIN GROUP SE AT A GLANCE BITCOIN GROUP SE KEY FIGURES 2023 2022 Number of customers 1,055,000 1,040,000 Bitcoin price EUR 38,833.34 15,496.24 Ethereum price EUR 2,071.45 1,114.17 Revenue EUR 7,751 8,344 thousand EBITDA EUR -1,790 1,371 thousand Earnings after taxes EUR 1,936 -2,409 thousand Earnings per share EUR 0.39 -0.48 Equity ratio % 74.7 77.23 6 FOREWORD BY THE MANAGEMENT BOARD Dear shareholders, Although the 2023 fiscal year was marked by the impact of adverse underlying conditions, at the Bitcoin Group we succeeded in overcoming these effects and maintaining our stability. The fundamental circumstances under which we entered 2023 were not easy due to external factors. High inflation, rising interest rates and geopolitical tensions weighed on the entire financial market for a lengthy period in 2023, which had a knock-on effect on the trading activities of both professional and private investors. At the same time, however, the past year was also pivotal for the crypto scene as a whole which gives us at the Bitcoin Group cause to look forward with optimism. Late recovery in crypto trading In the 2023 reporting year, Bitcoin Group SE generated revenue of EUR 7.8 million following EUR 8.3 million in the previous year. This decline was primarily due to persistently low trading activity in the first three quarters in the aftermath of the crypto winter of 2022. Although Bitcoin, as the most important benchmark for cryptocurrencies, recorded a significant increase of 156 % in 2023, most of this rise only occurred in the fourth quarter of 2023 with the result that trading activity on our cryptocurrency trading platform Bitcoin.de only picked up significantly in the final quarter. Earnings before interest, taxes, depreciation and amortization (EBITDA) stood at EUR -1.8 million by comparison with EUR 1.4 million in the prior year. Besides low trading activity overall, this result can be attributed to higher staff costs due to inflation and first and foremost to one-time costs in connection with the acquisition of Bankhaus von der Heydt which was called off in May 2023. The bottom line revealed a net profit of EUR 1.9 million following a loss of EUR -2.4 million in the prior year. This significant year-on-year improvement resulted primarily from the reversal of impairment losses. Earnings per share amounted to EUR 0.39 following EUR -0.48 per share in the previous year, with the number of shares remaining constant. The Bitcoin Group's balance sheet remains top class. The equity ratio as of December 31, 2023 stood at 74.7 % (December 31, 2022: 77.2 %). Cash and cash equivalents amounted to EUR 11.1 million following EUR 14.9 million on the 2022 reporting date. Our own net crypto holdings increased in fiscal 2023 to EUR 164.8 million compared with EUR 70.8 million as of December 31, 2022 due to the rise in prices on the crypto market. Our stable financial position paired with the pleasing growth in our own cryptocurrency portfolio permits us to again distribute a dividend of EUR 0.10 per share as we have in the previous two years. We will submit a corresponding dividend proposal to the Annual General Meeting on August 30, 2024 in line with our dividend policy which focuses on continuity. 7 ANNUAL REPORT 2023 LETTER TO SHAREHOLDERS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS Regulation as the main driver As already mentioned, fiscal 2023 saw some important markers laid down for the crypto sector, mainly in the regulatory environment with significant differences evident between regions. The USA tended to make negative headlines, particularly with lawsuits and penalties for trading platforms operating under the supervision of the US regulator SEC. Legal action against various crypto exchanges in connection with the improper handling of customers' money and issues regarding the classification of crypto assets increased uncertainty on the crypto market for a period of time and led in some cases to penalties in the billions for platform operators in connection with the bankruptcy of the FTX crypto exchange which previously ranked as the third largest in the world. We would like to explicitly point out that the Bitcoin Group and consequently also Bitcoin.de emerged stronger from the crypto crisis of 2022/23 as a transparent, regulated service provider. We welcome the gravity and sincerity of the regulatory authorities, with Europe and Germany in particular acting as the spearheads in defining a clear, structured course in the regulation of the crypto market and guiding the crypto market towards greater acceptance along sound, regulated lines. With the introduction of the finalized MiCA regula- tion, the European Union has established legal certainty in regulating the way in which digital assets are to be treated. This set of rules that is due to enter into force nationally in 2024 underline the crypto market's solid foundation and are a testament to the growing acceptance and integration of cryptocurrencies in the traditional banking sector. The growing acceptance of cryptocurrencies and above all the trust in a service provider fully regulated by the Federal Financial Supervisory Authority are also reflected in our customer base. At the end of the 2023 fiscal year, there were 1,055,000 registered customers using Bitcoin.de, up from the figure of 1,040,000 recorded at the end of 2022. Cryptocurrencies arrive in the mainstream A decisive boost for the crypto market resulted in 2023 from the financial industry in the form of major institutional players such as Fidelity, BlackRock, Franklin Templeton and Invesco who worked intensively in 2023 on the approval and introduction of spot Bitcoin ETFs in the USA. On January 11, 2024, almost a dozen fund providers were given the green light to launch the first spot Bitcoin ETFs in the USA. Expectations of this approval sent Bitcoin soaring to USD 42,507 in the fourth quarter of 2023, leading the way for all cryptocurrencies, after it had closed trading at USD 16,539 at the end of 2022. Since Bitcoin ETFs were greenlighted in the USA, several hundred million US dollars have flowed into such products every week, or around USD 12.8 billion on a cumulative basis by the end of May, with the result that the number one cryptocurrency rose to more than USD 70,000 for a period following the ETF approval. At the end of May 2024, Ethereum ETFs were also approved, thereby raising hopes that the crypto sector may be on the threshold of sustainable growth. 8 Outlook for 2024 The 2023 crypto year was marked by regulatory progress with more thorough regulation and growing institutional participation. Consequently, the future of the crypto industry remains fundamentally intriguing and dynamic, and we are convinced that its potential is far from exhausted. Nevertheless, times are currently such that market developments remain unusually challenging, especially in view of the war in Ukraine, the Middle East conflict and regulatory measures. Interest in cryptocurrencies and therefore in trading them fluctuates greatly in view of the multiplicity of external effects, making it hard to provide accurate overall forecasts. We therefore expect revenue to remain steady for the whole of 2024 and we are also assuming that EBITDA will be slightly positive. Finally, we would like to express our special thanks to our employees, shareholders and all other stakeholders who have extended us their trust in the past months. We view the future with confidence and look forward to continuing the exciting, successful story of the Bitcoin Group together with you. Herford, July 2024 Marco Bodewein Michael Nowak Per Hlawatschek Management Board Management Board Management Board 9 ANNUAL REPORT 2023 LETTER TO SHAREHOLDERS GROUP MANAGEMENT REPORT CONSOLIDATED FINANCIAL STATEMENTS 10