Workflow
Metalpha Technology (MATH) - 2022 Q4 - Annual Report
MATHMetalpha Technology (MATH)2023-03-30 16:00

Revenue and Financial Performance - Total revenue for the six months ended September 30, 2022, was 4,371,133,comparedto4,371,133, compared to 1,230,919 in the same period in 2021[7] - Net loss for the period was 4,886,279,comparedtoanetlossof4,886,279, compared to a net loss of 7,361,965 in the same period in 2021[7] - Total comprehensive loss for the period was 5,695,038,comparedto5,695,038, compared to 7,026,429 in the same period in 2021[7] - Basic and diluted loss per share attributable to owners of the company was 0.22forthesixmonthsendedSeptember30,2022,comparedto0.22 for the six months ended September 30, 2022, compared to 0.42 in the same period in 2021[7] - Revenue for the six months ended September 30, 2022 was 4,371,133,withtheMetalphasegmentcontributing4,371,133, with the Metalpha segment contributing 3,938,870 (90% of total revenue)[91] - Net loss for the six months ended September 30, 2022 was 4,886,279,withtheLongyunsegmentaccountingfor4,886,279, with the Longyun segment accounting for 5,304,803 of the loss[91] - Basic and diluted loss per share for the six months ended September 30, 2022, was (0.22),comparedto(0.22), compared to (0.42) for the same period in 2021[103] Digital Assets and Liabilities - Digital assets increased significantly to 44,505,633asofSeptember30,2022,upfrom44,505,633 as of September 30, 2022, up from 8,438,027 as of March 31, 2022[3] - Digital assets payables increased to 37,873,434asofSeptember30,2022,from37,873,434 as of September 30, 2022, from 6,200,109 as of March 31, 2022[3] - Digital assets held on exchange institutions increased significantly from US8,438,027toUS8,438,027 to US44,505,633, a 427.4% increase[44] - Fair value loss of approximately US1,330,133fromremeasurementofdigitalassetsforthesixmonthsendedSeptember30,2022[45]−FairvalueofdigitalassetsasofSeptember30,2022:1,330,133 from remeasurement of digital assets for the six months ended September 30, 2022[45] - Fair value of digital assets as of September 30, 2022: 44,505,633, classified under Level 2 in the fair value hierarchy[80] - Digital assets payables increased from 6,200,109asofMarch31,2022to6,200,109 as of March 31, 2022 to 37,873,434 as of September 30, 2022, driven by acquisitions of 171,899,214duringtheperiod[81]−TotaldigitalassetpayablestoAntalphaincreasedfrom171,899,214 during the period[81] - Total digital asset payables to Antalpha increased from 6,200,109 as of March 31, 2022, to 36,340,668asofSeptember30,2022[108]−ThecompanyenteredintoderivativeproductswithAntalphaamountingto36,340,668 as of September 30, 2022[108] - The company entered into derivative products with Antalpha amounting to 168,184,034 during the six months ended September 30, 2022[109] Cash Flow and Financing - Net cash used in operating activities decreased to 1,677,498in2022from1,677,498 in 2022 from 4,886,289 in 2021, showing a significant improvement in cash flow management[14] - Net cash provided by financing activities was 3,403,516in2022,primarilyfromproceedsofsharesissuedonprivateplacement[14]−Cashandcashequivalentsincreasedto3,403,516 in 2022, primarily from proceeds of shares issued on private placement[14] - Cash and cash equivalents increased to 7,271,584 as of September 30, 2022, from 5,286,991asofMarch31,2022[3]−CashandcashequivalentsincreasedfromUS5,286,991 as of March 31, 2022[3] - Cash and cash equivalents increased from US5,286,991 to US7,271,584,a37.57,271,584, a 37.5% increase[46] - The company issued 3,300,000 ordinary shares in a private placement on August 2, 2022, increasing share capital and additional paid-in capital[48] Assets and Liabilities - Total assets as of September 30, 2022, were 60,903,674, up from 24,338,739asofMarch31,2022[3]−Totalcurrentliabilitiesincreasedto24,338,739 as of March 31, 2022[3] - Total current liabilities increased to 44,522,076 as of September 30, 2022, from 10,031,527asofMarch31,2022[3]−Totalequityattributabletoownersofthecompanywas10,031,527 as of March 31, 2022[3] - Total equity attributable to owners of the company was 14,330,084 as of September 30, 2022, compared to 12,791,042asofMarch31,2022[3]−LoanstothirdpartiesincreasedfromUS12,791,042 as of March 31, 2022[3] - Loans to third parties increased from US7,138,703 to US8,060,849,a12.98,060,849, a 12.9% increase[40] - Total accounts and other payables as of September 30, 2022: 4,414,257, including accounts payables (6,115),otherpayablesandaccruedcharges(6,115), other payables and accrued charges (3,712,349), and amount due to related parties (695,793)[58]−Thecompany′sgearingratioincreasedsignificantlyfrom42695,793)[58] - The company's gearing ratio increased significantly from 42% as of March 31, 2022 to 73% as of September 30, 2022[89] - Total assets grew from 24,338,739 as of March 31, 2022 to 60,903,674asofSeptember30,2022,primarilyduetoa60,903,674 as of September 30, 2022, primarily due to a 38.1 million increase in Metalpha's current assets[93][96] - Non-current assets decreased from 712,459asofMarch31,2022to712,459 as of March 31, 2022 to 563,235 as of September 30, 2022, with a 100,799reductioninHongKongassets[98]ExpensesandCosts−CostofrevenueforthesixmonthsendedSeptember30,2022:100,799 reduction in Hong Kong assets[98] Expenses and Costs - Cost of revenue for the six months ended September 30, 2022: 192,681, primarily from supply chain management platform service[64] - Selling and promotion expenses for the six months ended September 30, 2022: 657,238,asignificantdecreasefrom657,238, a significant decrease from 3,792,621 in the same period in 2021[64] - General and administrative expenses for the six months ended September 30, 2022: 1,458,123,includingprofessionalfees(1,458,123, including professional fees (496,253), wages and benefits (376,500),andinsurancecosts(376,500), and insurance costs (155,915)[67] - Net finance cost for the six months ended September 30, 2022: (2,514),withinterestincomeof2,514), with interest income of 5,013 and finance cost of (7,527)[69]−CurrenttaxexpenseforthesixmonthsendedSeptember30,2022:7,527)[69] - Current tax expense for the six months ended September 30, 2022: 199,897, with a reconciliation of effective tax rate showing a loss before income tax of (4,686,382)[72]SubsidiariesandBusinessOperations−Thecompanytransferred1004,686,382)[72] Subsidiaries and Business Operations - The company transferred 100% equity interest in Radiant Alpha Limited to Antalpha Technologies Holdings Limited for 1, as Radiant Alpha had no operations[19] - Metalpha Limited, a subsidiary, operates cryptocurrency derivative product services in Hong Kong with a 51% ownership by the company[21] - The company's total assets for the discontinued Mainland China Business were 9,531,078asofSeptember30,2022[113]−LossfromdiscontinuedoperationsforthesixmonthsendedSeptember30,2022,was9,531,078 as of September 30, 2022[113] - Loss from discontinued operations for the six months ended September 30, 2022, was (383,177)[114] - Net cash outflows from the disposal group for the six months ended September 30, 2022, were 1,684[116]−ThecompanyapprovedthediscontinuationofitsMainlandChinaBusinessonJanuary20,2023[118]−TheaggregateconsiderationforthesaleofHangzhouDachengandHangzhouLongyunwas1,684[116] - The company approved the discontinuation of its Mainland China Business on January 20, 2023[118] - The aggregate consideration for the sale of Hangzhou Dacheng and Hangzhou Longyun was 1.00, completed on February 20, 2023[119] Leases and Property - New leases capitalized in right-of-use assets and lease liabilities amounted to 79,533in2022,comparedto79,533 in 2022, compared to 425,922 in 2021[16] - Property and equipment carrying amount decreased to 204,995asofSeptember30,2022,from204,995 as of September 30, 2022, from 297,974 as of March 31, 2022[29][30] - Lease liabilities decreased from US368,747toUS368,747 to US321,528, a 12.8% reduction[34] - The effective interest rate applied to lease liabilities ranged from 4.75% to 4.90% per annum[37] Shareholder and Equity Information - Share purchase warrants outstanding increased to 25,100,000 with a weighted average exercise price of US1.58[49]−Non−controllinginterestsasofSeptember30,2022:Taikexi(1.58[49] - Non-controlling interests as of September 30, 2022: Taikexi (530,672), Shenzhen Guanpeng (48,996),HangzhouXuZhihang(48,996), Hangzhou Xu Zhihang (10,459), Metalpha (2,475,661)[57]−Thecompanyhad25,100,000sharepurchasewarrantsoutstandingasofSeptember30,2022,whichcouldpotentiallydilutebasiclosspershareinthefuture[101]ValuationandFinancialModels−ThecompanyusestheBlack−ScholesPricingModelfordigitalassetspayablesvaluation,withexpectedvolatilityrangingfrom59.032,475,661)[57] - The company had 25,100,000 share purchase warrants outstanding as of September 30, 2022, which could potentially dilute basic loss per share in the future[101] Valuation and Financial Models - The company uses the Black-Scholes Pricing Model for digital assets payables valuation, with expected volatility ranging from 59.03% to 61.08% as of September 30, 2022[86] - The company engages external valuation experts with recognized professional qualifications for level 3 fair value measurements[82] Corporate Changes and Transactions - The company changed its name from "Dragon Victory International Limited" to "Metalpha Technology Holding Limited" on November 15, 2022[20] - The company changed its name from Dragon Victory International Limited to Metalpha Technology Holding Limited on November 15, 2022[117] - The company completed the purchase of 49% equity interest in Metalpha Limited from Antalpha for 2,500,000 on January 4, 2023[117] Regional Revenue Contribution - Hong Kong accounted for 90% of total revenue ($3,938,870) for the six months ended September 30, 2022, compared to zero in the same period last year[97]