Mining company Ebang announced a “substantial …

Mining company Ebang announces “significant drop” in profits in new IPO filing

Ebang, a cryptocurrency mining equipment maker, has reissued its prospectus for an IPO on the Hong Kong Stock Exchange (HKEX), where it noted a “significant decline” in profits in the third quarter, CoinDesk writes..

According to the HKEX database, Ebang issued a new application on December 20 and disclosed financial data therein before June 30 of this year, after its first application was frozen..

According to the latest data, in the first 6 months of 2018, the company’s revenue was 2.1 billion yuan ($ 304 million), which is 8 times more than in the same period in 2017. Profit for the first half of the year also increased significantly and amounted to $ 135 million, which is 16 times more than in the same period last year.

However, the third quarter saw a significant decrease in the average monthly sales of Ebang’s Bitcoin mining equipment. “We have experienced a significant decline in revenues and gross margins in the three months ending September 30, 2018, compared to the three previous months ending June 30, 2018,” the document says..

The company chose not to disclose details for the third quarter, when the cryptocurrency market resumed its decline – a factor that HKEX took into account when considering applications from mining firms such as Ebang and Bitmain.

Mining company Ebang announced a 'substantial ...

According to current HKEX regulations, the financial period reflected by any new applicant “must not end more than 6 months prior to the date of application.” Thus, by submitting the data before June 30, Ebang did not commit violations. However, a source familiar with the situation said both firms will have to provide third-quarter data if they want their applications to remain relevant next year..

The amount that Ebang expects to raise for the IPO is currently not disclosed, but the source said it has been “cut by more than half” since the original filing. In May, Reuters suggested that Ebang would target $ 1 billion.