Property, Plant and Equipment

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

4. Property, Plant and Equipment

Property, plant and equipment consist of the following at:

(Dollars in thousands)	March 31, 2024			December 31, 2023
Land and land improvements	$	1,553		$	1,538
Buildings and leasehold improvements		25,355			25,369
Computers and related software		11,250			11,764
Machinery and equipment		9,058			9,054
Office furniture and fixtures		28			28
Construction in progress		1,252			1,111
		48,496			48,864
Less: Accumulated depreciation		(5,232	)		(4,292	)
	$	43,264		$	44,572

Depreciation expense was approximately $1.6 million and $632 thousand for the three months ended March 31, 2024 and 2023, respectively.

The Company had an immaterial loss on sale of equipment of approximately $1 thousand for the three months ended March 31, 2024, in which they received proceeds of approximately $78 thousand for equipment that had a net book value of approximately $79 thousand. In January 2023, the Company sold M20 and M21 miners for a loss on sale of equipment of approximately $82 thousand in which the Company received proceeds of $213 thousand for our M20 and M21 miners which were previously reported as held for sale as of December 31, 2022, in which had a net book value of $295 thousand. There were additional proceeds of $36 thousand in March 2023, in which resulted in a gain of approximately $3 thousand of scrap and other equipment.

During the three months ended March 31, 2024, the Company had impairment charges of approximately $130 thousand. This charge related to the sale of S19 miners that occurred in April 2024, whereas the Company wrote down the net book value of the miners to the subsequent sales price. During the three months ended March 31, 2023, the Company had impairment charges of approximately $209 thousand related to impairment of approximately $166 thousand power supply units (PSUs) at the Sophie location and $43 thousand for M31 miners subsequently sold in April 2023, that the Company wrote down the net book value to subsequent sale price.

Equipment held for sale

In April 2023, Project Sophie entered into a 25 MW hosting contract with a sustainability-focused Bitcoin miner, that has shifted the Company’s business model at the Company’s modular data center at Project Sophie from proprietary mining to hosting Bitcoin miners for the customer. The Company obtained Board of Director approval to sell all remaining miners at the Sophie location and as of December 31, 2023, approximately $107 thousand remained outstanding whereas the Company expected to be sold within a year. For the three months ended, March 31, 2024, the Company has sold approximately $79 thousand of that balance, leaving approximately $28 thousand outstanding as of March 31, 2024. In March 2024, Project Dorothy 1B has begun to look to sell certain miners due to interest from third parties, and as such the Company has included $148 thousand for equipment held for sale as of March 31, 2024.