• Company Boosts Balance Sheet, Optimizes Operations

ALBANY, N.Y. / Aug 14, 2023 / Business Wire / Soluna Holdings, Inc. (“SHI” or the “Company”), (NASDAQ: SLNH), the parent company of Soluna Computing, Inc. (“SCI”), a developer of green data centers for Bitcoin mining and other intensive computing applications, reported financial results for the second quarter ended June 30, 2023.

John Belizaire, CEO of Soluna Holdings, said, “Our progress executing the 3-step plan I shared in my letter to shareholders in the first half of the year has resulted in a stronger balance sheet and improved cash flows. This sets us up for continued growth in the second half of 2023 as we complete our transition focused on monetizing our sites through hosting and joint ventures. I am proud of our operating teams and thankful for our investors' continued support.”

Finance and Operational Highlights:

The cash balance as of June 30, 2023, was $7.5 million compared to $1.1 million as of December 31, 2022. This is driven by new project-level investments, operational execution, and expense management measures implemented in the first half of the year.

The Company is still on track to deploy a record 2 EH/s across all sites by the end of the summer. Project Dorothy 1A and Project Sophie are now fully deployed with three hosting customers.

As of August 14, 2023, Project Dorothy 1B is completing construction and the Company has energized more than 11 MW of the buildings dedicated to the Proprietary Mining Joint Venture with Navitas Global.

The Company completed its tender of equipment purchase, with 8,378 machines purchased for a total of 868 PH/s of hashrate with an average efficiency of 29.9 J/TH, and at a cost of $11.25 $/TH inclusive of all fees, import, and taxes, $10.59 $/TH excluding taxes. Machine deployment at Project Dorothy 1B continues with more than 5,760 deployed to date.

More than 19,500 machines have been deployed across all three data centers as of August 14, 2023.

The Company averaged $30/MWh for energy costs even during the recent heat waves in Texas and Kentucky. The average efficiency across all the machines at the sites is less than 30 J/TH.

As described in the Company’s Earnings Power Illustration on June 21, 2023, the combined revenue potential for Project Dorothy 1A, Project Dorothy 1B, and Project Sophie is $37.5 million on an annualized basis.

Prospective investors visited Project Dorothy with an interest to finance up to 50 MW of Project Dorothy 2. Project Kati, Soluna’s new 166 MW data center, continues its development process, completing the first of three required ERCOT interconnection studies in the planning phase. The company has also advanced legal agreements with its power partner at Project Kati.

Financial Summary:

Key financial results for the second quarter include:

• The Company’s balance sheet and liquidity continued to strengthen. Its current ratio, which measures liquidity, improved to 1.4 from 0.2 at the end of 2022 resulting from the combination of new project-level investments and declining operating losses. Working capital improved to $6.1 million as of June 30, 2023, a $30.7 million increase, versus a negative $24.6 million for the period ended June 30, 2022.
• Total revenue in the second quarter of 2023 decreased by 76% to $2.1 million compared to $8.7 million in the second quarter of 2022. The decrease is primarily attributable to the decommissioning of Project Marie negatively impacting both proprietary mining and hosting revenues and the transition of Project Sophie from proprietary mining to primarily hosting during the second quarter of 2023.
• General and Administrative, exclusive of depreciation and amortization expenses decreased by 15% to $4.1 million in the second quarter of 2023, as compared to $4.9 million in the second quarter of 2022, primarily due to cost reductions related to salaries and benefits, reduced consulting and professional fees, offset in part by an increase in investor relations costs.
• Stock compensation expense during the second quarter of 2023 was $2.2 million versus $1.1 million in the second quarter of 2022.
• Net loss from continuing operations improved to $9.3 million in the second quarter of 2023 from $14.1 million in the second quarter of 2022.

The unaudited financial statements are available online.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Soluna Holdings, Inc. may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including but not limited to statements about Soluna’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, further information regarding which is included in the Company's filings with the Securities and Exchange Commission. All information provided in this press release is as of the date of the press release, and Soluna Holdings, Inc. undertakes no duty to update such information, except as required under applicable law.

About Soluna Holdings, Inc (SLNH)

Soluna Holdings, Inc. is the leading developer of green data centers that convert excess renewable energy into global computing resources. Soluna builds modular, scalable data centers for computing intensive, batchable applications such as Bitcoin mining, AI, and machine learning. Soluna provides a cost-effective alternative to battery storage or transmission lines. Soluna uses technology and intentional design to solve complex, real-world challenges. Up to 30% of the power of renewable energy projects can go to waste. Soluna’s data centers enable clean electricity asset owners to ‘Sell. Every. Megawatt.’