Marathon Patent Group Announces First Quarter 2019 Financial Results

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LAS VEGAS, May 10, 2019 (GLOBE NEWSWIRE) -- Marathon Patent Group, Inc. (NASDAQ:MARA) ("Marathon" or "Company"), today announced its operating results for the three months ended March 31, 2019, as published in its Form 10-Q filed today with the Securities and Exchange Commission.

Operating Results for the Quarter Ended March 31, 2019

  • Revenues of $230,694 during the three months ended March 31, 2019 compared to $239,967 during the three months ended March 31, 2018.
  • Operating loss improved to $984,909 (inclusive of non-cash expenses) for the quarter ended March 31, 2019 compared to an operating loss of $1.8 million (inclusive of non-cash expenses) quarter ended March 31, 2018.
  • GAAP net loss improved to $(0.16) per basic and diluted share for the quarter ended March 31, 2019 compared to $(0.63) for the quarter ended March 31, 2018.
  • Net cash used in operating activities decreased from $5.9 million for the three months ended March 31, 2018 to $811,136 during the three months ended March 31, 2019. The net cash used in operating activities plus revenue generated from the sale of digital currencies of $224,449 results in total cash used by the Company for the three months ended March 31, 2019 of $586,687.
  • The Company had approximately $2 million of cash and cash equivalents as of March 31, 2019.

Merrick Okamoto, Chief Executive Officer, stated, “We’re pleased to show significant financial improvement on a year over year basis including significant reductions in our operating costs, While recent improvements in the price of Bitcoin are clearly beneficial to our ongoing mining operations and should benefit our financial performance in our Q2, we continue to seek potential acquisition opportunities that we deem to offer the best opportunity for appreciation for our shareholders.”

Investor Notice

Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under "Risk Factors" in Item 1A of our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2018. If any of these risks were to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline, and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. See "Safe Harbor" below.

Forward-Looking Statements

Statements made in this press release include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “should,” “expect,” “anticipate,” “estimate,” “continue,” or comparable terminology. Such forward-looking statements are inherently subject to certain risks, trends and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate and involve factors that may cause actual results to differ materially from those projected or suggested. Readers are cautioned not to place undue reliance on these forward-looking statements and are advised to consider the factors listed above together with the additional factors under the heading “Risk Factors” in the Company's Annual Reports on Form 10-K, as may be supplemented or amended by the Company's Quarterly Reports on Form 10-Q. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise.

CONTACT INFORMATION

Name: Jason Assad
Phone: 678-570-6791
Email: Jason@marathonpg.com

 
MARATHON PATENT GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
         
    March 31,    December 31,
      2019       2018  
    (Unaudited)    
ASSETS        
Current assets:        
Cash and cash equivalents   $ 1,964,484     $ 2,551,171  
Digital currencies     5,637       -  
Prepaid expenses and other current assets     309,501       464,006  
Total current assets     2,279,622       3,015,177  
         
Other assets:        
Property and equipment, net of accumulated depreciation and impairment charges of $4,476,292 and $4,338,931 for March 31, 2019 and December 31, 2018, respectively     897,214       1,034,575  
Right-of-use assets     358,332       -  
Intangible assets, net of accumulated amortization of $83,039 and $65,245 for March 31, 2019 and December 31, 2018, respectively     1,126,961       1,144,755  
Total other assets     2,382,507       2,179,330  
TOTAL ASSETS   $ 4,662,129     $ 5,194,507  
         
LIABILITIES AND STOCKHOLDERS’ EQUITY        
         
Current liabilities:        
Accounts payable and accrued expenses   $ 1,168,469     $ 1,235,444  
Current portion of lease liability     80,971       -  
Warrant liability     76,817       39,083  
Convertible notes payable     999,106       999,106  
Total current liabilities     2,325,363       2,273,633  
Long-term liabilities        
Lease liability     178,574       -  
Total long-term liabilities     178,574       -  
Total liabilities     2,503,937       2,273,633  
         
Commitments and Contingencies        
         
Stockholders' Equity:        
Preferred stock, $0.0001 par value, 50,000,000 shares authorized, no shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively     -       -  
Common stock, $0.0001 par value; 200,000,000 shares authorized; 6,385,405 and 6,379,992 issued and outstanding at March 31, 2019 and December 31, 2018, respectively     639       638  
Additional paid-in capital     105,743,575       105,461,396  
Accumulated other comprehensive loss     (450,719 )     (450,719 )
Accumulated deficit     (103,135,303 )     (102,090,441 )
Total stockholders’ equity     2,158,192       2,920,874  
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $ 4,662,129     $ 5,194,507  


MARATHON PATENT GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
 
    For the three months ended
    March 31,
      2019       2018  
Revenues        
Cryptocurrency mining revenue   $ 230,694     $ 199,582  
Other revenue     -       40,385  
Total revenues      230,694       239,967  
         
Operating costs and expenses        
Cost of revenue     508,640       267,709  
Compensation and related taxes     486,687       413,118  
Consulting fees     20,000       38,203  
Professional fees     85,033       804,286  
General and administrative     115,243       563,716  
Total operating expenses     1,215,603       2,087,032  
Operating loss     (984,909 )     (1,847,065 )
Other income (expenses)        
Other income (expenses)     (9,437 )     2,454  
Foreign exchange loss     (11,873 )     (15,332 )
Realized loss on sale of digital currencies     (608 )     (11,067 )
Change in fair value of warrant liability     (37,734 )     1,453,257  
Amortization of debt discount     -       (1,944,772 )
Interest income     12,016       -  
Interest expense     (12,317 )     (40,295 )
Total other expenses     (59,953 )     (555,755 )
Net loss   $ (1,044,862 )   $ (2,402,820 )
         
Net loss per share, basic and diluted:   $ (0.16 )   $ (0.63 )
Weighted average shares outstanding, basic and diluted:     6,338,418       3,805,684  
         
         
Net loss   $ (1,044,862 )   $ (2,402,820 )
Other comprehensive income:        
Unrealized gain on foreign currency translation     -       15  
Comprehensive loss attributable to Marathon Patent Group, Inc.   $ (1,044,862 )   $ (2,402,805 )


MARATHON PATENT GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
 
    For the three months ended
    March 31,
      2019       2018  
CASH FLOWS FROM OPERATING ACTIVITIES        
Net loss   $ (1,044,862 )   $ (2,402,820 )
Adjustments to reconcile net loss to net cash (used in) operating activities:        
Depreciation     137,361       232,006  
Amortization of patents and website     17,794       12,120  
Realized loss on sale of digital currencies     608       11,067  
Change in fair value of warrant liability     37,734       (1,453,257 )
Stock based compensation     282,180       329,525  
Amortization of debt discount     -       1,944,772  
Amortization of right-of-use assets     21,795       -  
Bad debt allowance     -       6,826  
Changes in operating assets and liabilities:        
Digital currencies     (230,694 )     (199,582 )
Lease liability     (21,441 )     -  
Litigation liability     -       (2,150,000 )
Prepaid expenses and other assets     55,364       (91,183 )
Accounts payable and accrued expenses     (66,975 )     110,104  
Net cash used in operating activities     (811,136 )     (3,650,422 )
CASH FLOWS FROM INVESTING ACTIVITIES        
Sale of digital currencies     224,449       120,470  
Acquisition of patents     -       (250,000 )
Purchase of property and equipment     -       (5,800,629 )
Net cash provided by (used in) investing activities     224,449       (5,930,159 )
         
Effect of foreign exchange rate changes     -       15  
         
Net decrease in cash and cash equivalents     (586,687 )     (9,580,566 )
Cash and cash equivalents — beginning of period     2,551,171       14,948,529  
Cash and cash equivalents — end of period   $ 1,964,484     $ 5,367,963  
         
Supplemental schedule of non-cash investing and financing activities:        
Par value adjustment due to reverse split   $ 1     $ -  
Conversion of Series E Preferred Stock to common stock   $ -     $ 357  
Par value adjustment due to reverse split   $ -     $ 960,000  
Common stock issued for note conversion   $ -     $ 2,095,588  
Restricted stock issuance   $ -     $ 39  
Warrants exercised into common shares   $ -     $ 55,791  
         

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