DigitalX Limited posted a larger loss for FY25 despite an 18% revenue increase, driven by digital asset appreciation and a bold Bitcoin accumulation strategy.
- Loss after tax widened to AUD 6 million
- Revenue grew 18% to AUD 3.83 million, boosted by staking rewards
- Net assets surged 83% to AUD 67.9 million due to digital asset revaluation
- Two funds wound up with assets returned to unitholders
- Post-reporting $20.7 million capital raise and significant Bitcoin purchases
Financial Performance Overview
DigitalX Limited has released its preliminary final report for the year ended 30 June 2025, revealing a mixed financial picture. The company recorded a consolidated loss after tax of AUD 5.98 million, a deterioration from the AUD 4.79 million loss reported in the prior year. Despite this, revenues from ordinary activities increased by 18% to AUD 3.83 million, reflecting growth in asset management fees, brokerage fees, and the introduction of staking rewards since December 2024.
The company’s total comprehensive income, however, showed a marked improvement, rising to AUD 12.82 million from AUD 6.18 million the previous year. This was largely driven by a substantial fair value increase in its digital asset holdings, underscoring the volatile yet potentially lucrative nature of its core investments.
Asset Growth and Fund Restructuring
DigitalX’s net assets nearly doubled, climbing 83% to AUD 67.94 million. This growth was supported by capital raising activities and the appreciation of digital assets, particularly Bitcoin and Solana. The company’s digital asset portfolio expanded significantly, with digital assets valued at over AUD 83 million at year-end, up from AUD 48.9 million the previous year.
During the year, DigitalX resolved to wind up two of its funds, the DigitalX Fund and the DigitalX Real World Asset Tokenisation Fund, distributing net assets to unitholders and effectively reducing equity in these funds to nil. The DigitalX BTC Fund remains active, with the company holding a 72.74% interest.
Strategic Moves Post-Reporting Period
Following the reporting period, DigitalX announced a strategic capital raise of AUD 20.7 million, attracting global digital asset investors such as Animoca Brands, UTXO Management, and ParaFi Capital. This capital injection is part of a broader strategy to bolster the company’s Bitcoin holdings, with recent acquisitions totaling over 240 Bitcoin at prices averaging around US$118,000 per coin.
The company also formalized its Bitcoin-first treasury strategy by establishing a Strategic Advisory Board featuring industry heavyweights Yat Siu of Animoca Brands and Hervé Larren of Airvey.io. Additionally, Will Hamilton was appointed Chief Commercial Officer to spearhead commercial initiatives aligned with this strategy.
Operational and Governance Highlights
DigitalX continues to focus on its core business units, including the Sell My Shares division and treasury asset management. The company’s goodwill, primarily related to Sell My Shares, remains unimpaired despite challenging market conditions, supported by prudent revenue growth assumptions and a disciplined impairment testing framework.
Share-based payments remain a notable expense, with over 99 million options and 5 million performance rights outstanding, reflecting ongoing incentives for management and staff aligned with shareholder interests.
Bottom Line?
DigitalX’s FY25 results underscore the challenges of navigating losses amid growth, but its aggressive Bitcoin strategy and capital raises set the stage for a transformative next chapter.
Questions in the middle?
- How will the winding up of two funds affect DigitalX’s future revenue streams?
- What are the risks and timelines associated with the company’s ambitious Bitcoin accumulation plan?
- How might share-based payments and potential dilution impact shareholder value going forward?