NEWARK, N.J., May 7, 2020 /PRNewswire/ -- Genie Energy Ltd.
(NYSE: GNE, GNEPRA) reported first quarter 2020 net income of
$0.20 per diluted share on revenue of
$104.1 million.
HIGHLIGHTS
(Throughout this release, 1Q20 results
are compared to 1Q19 results unless otherwise noted)
- Global RCEs served increased by 68,000 (20.4%) year over to
year to 401,000.
- Global meters served increased by 133,000 (33.4%) year over to
year to 532,000.
- Genie generated the highest levels of quarterly revenue and
gross profit in the company's history.
- Consolidated revenue increased 20.1% to $104.1 million from $86.6
million driven by customer base growth.
- Consolidated income from operations decreased to $9.2 million from $9.8
million in 1Q19, while Adjusted EBITDA* decreased to
$10.3 million from $10.4 million.
- At Genie Retail Energy (GRE), our domestic REP business, income
from operations decreased to $13.0
million from $13.5 million and
Adjusted EBITDA* decreased to $13.3
from $13.8 million.
- Genie's Board of Directors has approved an increase in the
quarterly dividend per share of common stock to $0.085 from $0.075,
an increase of 13%. The indicated annual dividend rate is now
$0.34.
COMMENTS OF MICHAEL STEIN, CEO
First, I want to
acknowledge and thank our colleagues and employees. I've been
absolutely blown away by the hard work, efficiency and
effectiveness of the Genie staff who are excelling every day
despite all the distractions and stresses of working from
home. Thank you so much. And all of us at Genie salute
the first responders, nurses, doctors and law enforcement
professionals who are doing amazing work caring for those who are
ill. Our thoughts and prayers go out to those who are
suffering and their families.
"Genie Energy achieved very strong first quarter results.
Robust growth in our global customer base and strong margins helped
us attain record levels of revenue and gross profit. Our
global customer base surpassed the 400,000-RCE and 500,000-meter
milestones, powered by expansion in both our domestic and overseas
markets.
"Looking ahead, we anticipate that COVID-19 will have a mixed
impact on our business operations and financial results. In the
short run, with our predominantly residential book, we expect a
positive impact from increased per-meter electricity consumption as
our customers spend more time at home. In addition, meter
acquisition expense and customer churn are decreasing as the result
of the industry-wide suspension of door-to- door meter
acquisition. On the other hand, restrictions on in-person
sales and marketing will likely slow customer acquisition for the
duration of the pandemic and may result in net meter attrition.
"We are working hard to calibrate our operations to address the
challenges of the pandemic and have achieved success in the early
stages. Our outlook remains positive. With our
diversified markets, liquid balance sheet and very low level of
long-term debt, we are positioned to build on the first quarter's
terrific momentum. In light of the resilience of our business
and these underlying strengths, Genie's Board of Directors has
increased our quarterly dividend 13% to $0.085 per share."
CONSOLIDATED RESULTS
$ in millions,
except EPS
|
1Q20
|
4Q19
|
1Q19
|
|
1Q20-1Q19
Change
(%/$)
|
Revenue
|
$104.1
|
$82.0
|
$86.6
|
|
+20.1%
|
Gross
profit
|
$28.9
|
$22.0
|
$25.6
|
|
+13.0%
|
Gross margin
percentage
|
27.8%
|
26.8%
|
29.5%
|
|
(170) BP
|
SG&A
expense
|
$19.5
|
$19.3
|
$15.8
|
|
+23.8%
|
Stock-based compensation included in SG&A
|
$0.5
|
-
|
$0.4
|
|
+7.8%
|
Depreciation and amortization
|
$0.8
|
$0.8
|
$0.9
|
|
(9.3)%
|
Impairment of
assets
|
$0.2
|
$0.4
|
-
|
|
+$0.2
|
Income from
operations
|
$9.2
|
$2.3
|
$9.8
|
|
(6.3)%
|
Adjusted
EBITDA*
|
$10.3
|
$0.8
|
$10.4
|
|
(0.6)%
|
Equity in the net
loss in equity method investees**
|
$(0.4)
|
$(2.7)
|
$(0.8)
|
|
+$0.4
|
Provision for income
taxes
|
$(2.6)
|
$(1.5)
|
$(2.9)
|
|
+$0.3
|
Net income
attributable to Genie Energy common stockholders
|
$5.5
|
-
|
$5.7
|
|
$(0.2)
|
Earnings per diluted
share attributable to Genie Energy common stockholders
|
$0.20
|
-
|
$0.21
|
|
$(0.01)
|
Net cash (used in)
provided by operating activities
|
$(2.7)
|
$0.2
|
$7.0
|
|
$(9.7)
|
|
* Adjusted
EBITDA for all periods presented is a non-GAAP measure intended to
provide useful information that supplements the core operating
results in accordance with GAAP of Genie Energy or the relevant
segment. Please refer to the 'Reconciliation of Non-GAAP
Financial Measures' at the end of this release for an explanation
of Adjusted EBITDA as well as for reconciliations to its most
directly comparable GAAP measures.
|
|
** Genie Energy
accounts for its investments in Orbit Energy, its joint venture
operating in the U.K., and Atid, a drilling contractor based in
Israel in which it holds a minority stake, under the equity method
of accounting. Under this method, Genie Energy records its share in
the net income or loss of the venture. Therefore, revenue generated
and expenses incurred are not reflected in Genie Energy's
consolidated revenue and expenses. However, Orbit Energy's
customers are included in metrics regarding our global customer
base.
|
GLOBAL METERS AND RCEs
Genie Energy's global customer base increased sequentially and
year-over-year driven by investment in customer acquisition in
domestic and overseas markets. Genie Energy's global RCE and
meter totals are provided in the chart below.
Global RCEs and
Meters
(in thousands)***
|
March 31,
2020
|
December 31,
2019
|
September 30,
2019
|
June 30,
2019
|
March 31,
2019
|
Electricity
RCEs
|
325
|
297
|
309
|
291
|
272
|
Natural gas
RCEs
|
76
|
77
|
75
|
66
|
61
|
Total
RCEs
|
401
|
374
|
384
|
357
|
333
|
|
|
|
|
|
|
Electricity
meters
|
421
|
390
|
392
|
361
|
322
|
Natural gas
meters
|
111
|
107
|
100
|
87
|
77
|
Total
meters
|
532
|
497
|
492
|
448
|
399
|
|
*** Includes RCEs
and meters acquired and served by Genie Energy's domestic and
international retail energy provider businesses including
operations in Finland and Japan and at Genie's joint venture in the
U.K. (although U.K. operations are not included in our consolidated
results of operations).
|
SEGMENT RESULTS
Genie Retail Energy (GRE)
GRE's financial results are summarized in the chart below:
Genie Retail
Energy
$ in
millions
|
1Q20
|
4Q19
|
1Q19
|
|
1Q20-1Q19
Change
(%/$)
|
Total
revenue
|
$79.1
|
$74.0
|
$76.5
|
|
+3.4%
|
Electricity revenue
|
$63.1
|
$61.2
|
$57.8
|
|
+9.1%
|
Natural
gas revenue
|
$16.1
|
$12.9
|
$18.7
|
|
(14.1)%
|
Gross
profit
|
$27.6
|
$22.0
|
$24.7
|
|
+11.9%
|
Gross margin
percentage
|
34.9%
|
29.7%
|
32.3%
|
|
+260 BP
|
SG&A
expense
|
$14.6
|
$13.8
|
$11.2
|
|
+30.5%
|
Depreciation and amortization
|
$0.1
|
$0.2
|
$0.2
|
|
$(0.1)
|
Income from
operations
|
$13.0
|
$8.2
|
$13.5
|
|
$(0.5)
|
Adjusted
EBITDA*
|
$13.3
|
$8.5
|
$13.8
|
|
$(0.5)
|
GRE – KPIs and Take-Aways:
- Customers served at March 31,
2020 increased to 330,000 RCEs from 300,000 RCEs a year
earlier. Meters served increased to 384,000 from 344,000. The
robust increases reflect sustained investment in new customer
acquisitions.
- Gross meters added during 1Q20 totaled 69,000 compared to
85,000 in 1Q19 (including approximately 34,000 meters added through
a municipal aggregation deal) and 56,000 in 4Q19. COVID-19 related
public health restrictions did not significantly slow meter
acquisition during 1Q20 but are expected to impact 2Q20 meter
acquisition.
- Average monthly churn decreased to 4.7% from 5.3% in 1Q19 and
6.1% in 4Q19.
- Electricity revenue increased to $63.1
million from $57.8 million in
1Q19. The increase was driven by the growth of GRE's customer base
partially offset by lower revenue per kWh sold.
- Natural gas revenue decreased to $16.1
million from $18.7 million in
1Q19. The decrease was driven by lower consumption per customer and
lower revenue per therm sold partially offset by an increase in
customers served.
- Income from operations decreased to $13.0 million from $13.5
million and Adjusted EBITDA decreased to $13.3 from $13.8
million as increased gross profit was offset by increased
investment in customer acquisition and marketing.
Genie Retail Energy International (GRE
International)
Genie Energy accounts for its investments in Orbit Energy,
its joint venture operating in the U.K., under the equity method of
accounting. Revenue generated, and expenses incurred, are not
reflected in segment revenue and operating expenses. RCE and meter
counts do, however, include Orbit Energy customers.
GRE
International
$ in
millions
|
1Q20
|
4Q19
|
1Q19
|
|
1Q20-1Q19
Change
(%/$)
|
Total
revenue
|
$7.0
|
$5.8
|
$4.8
|
|
+43.6%
|
Gross (loss)
profit
|
$(0.3)
|
$(0.3)
|
-
|
|
$(0.3)
|
Gross profit
percentage
|
(4.0)%
|
(5.0)%
|
-
|
|
(400) BP
|
SG&A
expense
|
$2.2
|
$2.9
|
$1.7
|
|
+29.4%
|
Loss from
operations
|
$(2.5)
|
$(3.2)
|
$(1.7)
|
|
$(0.8)
|
Adjusted
EBITDA*
|
$(2.0)
|
$(5.6)
|
$(2.3)
|
|
+$0.3
|
Equity in the net
loss in Orbit Energy**
|
-
|
$(2.5)
|
$(1.1)
|
|
+$1.1
|
GRE International – KPIs and Take-Aways:
- Customers served at March 31,
2020 increased to 72,000 RCEs from 33,000 RCEs and to
148,000 meters from 55,000 meters a year earlier led by growth of
Orbit Energy's customer base in the U.K.
- GRE International's revenue increased to $7.0 million compared to $4.8 million in 1Q19 primarily driven by the
growth in Lumo Energia's customer base.
- Loss from operations increased to $2.5
million from $1.7 million in
1Q19 reflecting increased investment in new meter acquisitions and
the impact of the decline in global power markets on certain hedge
positions.
- Equity in the net loss of Orbit Energy was nil compared to a
net loss of $1.1 million in 1Q19
reflecting the timing of capital contributions to Orbit
Energy.
- On a pro forma basis****, inclusive of Orbit Energy's revenue,
GRE International's revenue increased to $26.6 million in 1Q20 from $8.8 million in 1Q19.
- On a pro forma basis****, inclusive of Orbit Energy's loss from
operations, GRE International's loss from operations was
$4.8 million in 1Q20 compared to
$3.4 million in 1Q19.
**** Pro forma results for all periods presented are non-GAAP
measures intended to provide useful information that supplement the
core operating results in accordance with GAAP of the relevant
segment. Please refer to the 'Reconciliation of Non-GAAP
Financial Measures' at the end of this release for an explanation
of the pro forma results as well as for reconciliations to their
most directly comparable GAAP measures.
Genie Energy Services (GES)
GES comprises Diversegy, a commercial energy consulting
business, Genie's interest in Prism Solar, a supplier of solar
panels and solutions, and Genie Solar Energy.
- Revenue increased to $18.0
million from $5.3 million
reflecting Prism Solar's delivery of a large number of orders.
Genie Energy is currently exploring options to reduce overhead at
Prism Solar due to changes in market conditions.
- Income from operations was $0.3
million compared to a loss from operations of $0.2 million in 1Q19.
Genie Oil and Gas (GOGAS)
Genie Energy accounts for its minority interest in Atid, a
drilling company based in Israel,
under the equity method of accounting. Atid's revenue generated,
and expenses incurred, are not reflected in segment revenue and
operating expenses.
- Operations at GOGAS' Afek oil and gas exploration subsidiary
remain suspended pending final testing on an existing well, which
is expected to take place as early as the first half of
2020.
- GOGAS' loss from operations was $0.2
million in both 1Q20 and 1Q19.
Corporate
- Corporate loss from operations decreased to $1.4 million from $1.5
million in 1Q19. The losses include the impact of
corporate stock-based compensation which increased to $0.3 million from $0.2
million in 1Q19.
BALANCE SHEET AND CASH FLOW HIGHLIGHTS
At
March 31, 2020, Genie Energy had
$157.2 million in total assets,
including $36.4 million in cash, cash
equivalents and restricted cash. Liabilities totaled
$72.0 million and working capital
(current assets less current liabilities) totaled $51.1 million an increase of $10.3 million from December 31, 2019.
Cash used in operating activities in 1Q20 was $2.7 million compared to cash provided by
operating activities of $7.0 million
in 1Q19. Operating cash flow in the quarter was negatively
impacted by the deliveries of solar panels at Prism Solar (with
cash payment having been made in 2019) and the posting of cash
collateral in support of certain hedge positions at GRE.
DIVIDEND ON GENIE ENERGY COMMON STOCK
Genie's Board
of Directors has declared a first quarter dividend of $0.085, a $0.01
increase from prior quarters, with a record date of May 19, 2020. The dividend will be paid on
or about May 29, 2020. The
distribution will be treated as an ordinary dividend for income tax
purposes.
GENIE ENERGY EARNINGS CONFERENCE CALL
This earnings
press release is available for download in the "Investors" section
of the Genie Energy website
(https://genie.com/investors/investor-relations/) and has been
filed on a current report (Form 8-K) with the SEC.
At 2:00 PM Eastern time today,
May 7, 2020, Genie Energy's
management will host a conference call to discuss financial and
operational results, business outlook and strategy. The call
will begin with management's remarks followed by Q&A with
investors.
To participate in the conference call, dial 1-888-348-6472
(toll-free from the US) or 1-412-902-4240 (international) and
request the Genie Energy conference call.
Approximately three hours after the call, a call replay will be
accessible by dialing 1-844-512-2921 (toll-free from the US) or
1-412-317-6671 (international) and providing the replay PIN:
10143670. The replay will remain available through May 14, 2020. A recording of the call - in
MP3 format - will also be available for playback on the "Investors"
section of the Genie Energy website.
Investors can sign up through the Genie Energy website to have
earnings releases and other press releases e-mailed directly to
them.
ABOUT GENIE ENERGY LTD.
Genie Energy Ltd. (NYSE: GNE,
GNEPRA), is a global provider of energy services. The Genie
Retail Energy division supplies electricity, including electricity
from renewable resources, and natural gas to residential and small
business customers in the United
States. The Genie Retail Energy International division
supplies customers in Europe and
Asia. The Genie Energy Services division includes Diversegy,
a commercial and industrial brokerage and consultative services
company, and Genie Solar Energy and Prism Solar, which design,
supply and install commercial solar solutions. For more
information, visit Genie.com.
In this press release, all statements that are not purely
about historical facts, including, but not limited to, those in
which we use the words "believe," "anticipate," "expect," "plan,"
"intend," "estimate, "target" and similar expressions, are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. While these
forward-looking statements represent our current judgment of what
may happen in the future, actual results may differ materially from
the results expressed or implied by these statements due to
numerous important factors, including, but not limited to, those
described in our most recent report on SEC Form 10-K (under the
headings "Risk Factors" and "Management's Discussion and Analysis
of Financial Condition and Results of Operations"), which may be
revised or supplemented in subsequent reports on SEC Forms 10-Q and
8-K. We are under no obligation, and expressly disclaim any
obligation, to update the forward-looking statements in this press
release, whether as a result of new information, future events or
otherwise.
GENIE ENERGY
LTD.
|
CONSOLIDATED
BALANCE SHEETS
|
(in thousands,
except per share amounts)
|
|
|
|
March 31,
2020
|
|
|
December 31,
2019
|
|
|
|
(Unaudited)
|
|
|
(Note
1)
|
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
29,710
|
|
|
$
|
31,242
|
|
Restricted
cash—short-term
|
|
|
6,185
|
|
|
|
6,792
|
|
Trade accounts
receivable, net of allowance for doubtful accounts of $3,134 and
$2,631 at March 31, 2020 and December 31, 2019,
respectively
|
|
|
45,494
|
|
|
|
49,822
|
|
Inventory
|
|
|
18,061
|
|
|
|
16,632
|
|
Prepaid
expenses
|
|
|
7,674
|
|
|
|
6,318
|
|
Other current
assets
|
|
|
13,699
|
|
|
|
2,133
|
|
Total current
assets
|
|
|
120,823
|
|
|
|
112,939
|
|
Property and
equipment, net
|
|
|
443
|
|
|
|
3,607
|
|
Goodwill
|
|
|
12,102
|
|
|
|
12,135
|
|
Other intangibles,
net
|
|
|
6,327
|
|
|
|
6,837
|
|
Investment in equity
method investees
|
|
|
293
|
|
|
|
675
|
|
Restricted
cash—long-term
|
|
|
493
|
|
|
|
520
|
|
Deferred income tax
assets, net
|
|
|
9,801
|
|
|
|
12,154
|
|
Other
assets
|
|
|
6,894
|
|
|
|
7,377
|
|
Total
assets
|
|
$
|
157,176
|
|
|
$
|
156,244
|
|
Liabilities and
equity
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Loan
payable
|
|
$
|
925
|
|
|
$
|
921
|
|
Trade accounts
payable
|
|
|
24,243
|
|
|
|
24,387
|
|
Accrued
expenses
|
|
|
28,936
|
|
|
|
26,116
|
|
Contract
liability
|
|
|
3,893
|
|
|
|
13,426
|
|
Income taxes
payable
|
|
|
1,796
|
|
|
|
1,591
|
|
Due to IDT
Corporation, net
|
|
|
137
|
|
|
|
381
|
|
Short-term revolving
line of credit
|
|
|
3,518
|
|
|
|
2,514
|
|
Other current
liabilities
|
|
|
6,281
|
|
|
|
2,820
|
|
Total current
liabilities
|
|
|
69,729
|
|
|
|
72,156
|
|
Long-term notes
payable
|
|
|
—
|
|
|
|
777
|
|
Other
liabilities
|
|
|
2,238
|
|
|
|
2,381
|
|
Total
liabilities
|
|
|
71,967
|
|
|
|
75,314
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
Genie Energy Ltd.
stockholders' equity:
|
|
|
|
|
|
|
|
|
Preferred stock, $0.01
par value; authorized shares—10,000:
|
|
|
|
|
|
|
|
|
Series 2012-A,
designated shares—8,750; at liquidation preference, consisting of
2,322 shares issued and outstanding at March 31, 2020 and December
31, 2019
|
|
|
19,743
|
|
|
|
19,743
|
|
Class A common
stock, $0.01 par value; authorized shares—35,000; 1,574 shares
issued and outstanding at March 31, 2020 and December 31,
2019
|
|
|
16
|
|
|
|
16
|
|
Class B common stock,
$0.01 par value; authorized shares—200,000; 25,805 and 25,785
shares issued and 24,763 and 24,755 shares outstanding at March 31,
2020 and December 31, 2019, respectively
|
|
|
258
|
|
|
|
258
|
|
Additional paid-in
capital
|
|
|
140,069
|
|
|
|
139,615
|
|
Treasury stock, at
cost, consisting of 1,042 and 1,030 shares of Class B
common stock at March 31, 2020 and December 31, 2019
|
|
|
(7,763)
|
|
|
|
(7,675)
|
|
Accumulated other
comprehensive income
|
|
|
2,230
|
|
|
|
2,519
|
|
Accumulated
deficit
|
|
|
(56,184)
|
|
|
|
(59,671)
|
|
Total Genie Energy
Ltd. stockholders' equity
|
|
|
98,369
|
|
|
|
94,805
|
|
Noncontrolling interests
|
|
|
(13,160)
|
|
|
|
(13,875)
|
|
Total
equity
|
|
|
85,209
|
|
|
|
80,930
|
|
Total liabilities and
equity
|
|
$
|
157,176
|
|
|
$
|
156,244
|
|
GENIE ENERGY
LTD.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(Unaudited)
|
|
|
|
|
Three Months
Ended
March 31,
|
|
|
|
|
2020
|
|
|
|
2019
|
|
|
(in thousands,
except per share data)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Electricity
|
|
$
|
69,972
|
|
|
$
|
62,614
|
|
Natural
gas
|
|
|
16,070
|
|
|
|
18,706
|
|
Other
|
|
|
18,009
|
|
|
|
5,297
|
|
Total
revenues
|
|
|
104,051
|
|
|
|
86,617
|
|
Cost of
revenues
|
|
|
75,146
|
|
|
|
61,026
|
|
Gross
profit
|
|
|
28,905
|
|
|
|
25,591
|
|
Operating expenses
and losses:
|
|
|
|
|
|
|
|
|
Selling, general and
administrative (i)
|
|
|
19,499
|
|
|
|
15,757
|
|
Impairment of
property and equipment
|
|
|
192
|
|
|
|
—
|
|
Income from
operations
|
|
|
9,214
|
|
|
|
9,834
|
|
Interest
income
|
|
|
128
|
|
|
|
93
|
|
Interest
expense
|
|
|
(123)
|
|
|
|
(140)
|
|
Equity in the net
loss in equity method investees, net
|
|
|
(379)
|
|
|
|
(797)
|
|
Other income,
net
|
|
|
150
|
|
|
|
73
|
|
Income before income
taxes
|
|
|
8,990
|
|
|
|
9,063
|
|
Provision for income
taxes
|
|
|
(2,569)
|
|
|
|
(2,903)
|
|
Net income
|
|
|
6,421
|
|
|
|
6,160
|
|
Net income
attributable to noncontrolling interests
|
|
|
589
|
|
|
|
91
|
|
Net income
attributable to Genie Energy Ltd.
|
|
|
5,832
|
|
|
|
6,069
|
|
Dividends on
preferred stock
|
|
|
(370)
|
|
|
|
(370)
|
|
Net income
attributable to Genie Energy Ltd. common stockholders
|
|
$
|
5,462
|
|
|
$
|
5,699
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Genie Energy Ltd. common stockholders:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.21
|
|
|
$
|
0.21
|
|
Diluted
|
|
$
|
0.20
|
|
|
$
|
0.21
|
|
Weighted-average
number of shares used in calculation of earnings per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
26,108
|
|
|
|
26,532
|
|
Diluted
|
|
|
26,749
|
|
|
|
27,240
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per common share
|
|
$
|
0.075
|
|
|
$
|
0.075
|
|
(i) Stock-based
compensation included in selling, general and administrative
expenses
|
|
$
|
483
|
|
|
$
|
448
|
|
GENIE ENERGY
LTD.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
|
Three Months
Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
(in
thousands)
|
|
Operating
activities
|
|
|
|
|
|
|
Net income
|
|
$
|
6,421
|
|
|
$
|
6,160
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
826
|
|
|
|
921
|
|
Impairment of property
and equipment
|
|
|
192
|
|
|
|
—
|
|
Deferred income
taxes
|
|
|
2,353
|
|
|
|
2,442
|
|
Provision for doubtful
accounts receivable
|
|
|
608
|
|
|
|
72
|
|
Stock-based
compensation
|
|
|
483
|
|
|
|
448
|
|
Equity in the net loss
in equity method investees
|
|
|
379
|
|
|
|
797
|
|
Gain on
deconsolidation of subsidiaries
|
|
|
(98)
|
|
|
|
—
|
|
Change in assets and
liabilities:
|
|
|
|
|
|
|
|
|
Trade accounts
receivable
|
|
|
3,719
|
|
|
|
(3,554)
|
|
Inventory
|
|
|
(1,429)
|
|
|
|
208
|
|
Prepaid
expenses
|
|
|
(1,356)
|
|
|
|
1,320
|
|
Other current assets
and other assets
|
|
|
(8,473)
|
|
|
|
(1,041)
|
|
Trade accounts
payable, accrued expenses and other current liabilities
|
|
|
3,344
|
|
|
|
(859)
|
|
Contract
liability
|
|
|
(9,648)
|
|
|
|
(256)
|
|
Due to IDT
Corporation
|
|
|
(244)
|
|
|
|
(100)
|
|
Income taxes
payable
|
|
|
206
|
|
|
|
460
|
|
Net cash (used in)
provided by operating activities
|
|
|
(2,717)
|
|
|
|
7,018
|
|
Investing
activities
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(5)
|
|
|
|
(325)
|
|
Payments for business
acquisition, net of cash acquired
|
|
|
—
|
|
|
|
(1,852)
|
|
Investments in notes
receivables
|
|
|
—
|
|
|
|
(177)
|
|
Repayment of notes
receivable
|
|
|
—
|
|
|
|
122
|
|
Net cash used in
investing activities
|
|
|
(5)
|
|
|
|
(2,232)
|
|
Financing
activities
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
|
(370)
|
|
|
|
(2,377)
|
|
Repayment of
short-term debt—Lumo
|
|
|
—
|
|
|
|
(2,260)
|
|
Proceeds from
revolving line of credit
|
|
|
1,000
|
|
|
|
—
|
|
Exercise of stock
options
|
|
|
—
|
|
|
|
172
|
|
Purchases of Class B
common stock
|
|
|
(88)
|
|
|
|
—
|
|
Repayment of notes
payable
|
|
|
(9)
|
|
|
|
—
|
|
Net cash provided by
(used in) financing activities
|
|
|
533
|
|
|
|
(4,485)
|
|
Effect of exchange
rate changes on cash, cash equivalents, and restricted
cash
|
|
|
23
|
|
|
|
(35)
|
|
Net (decrease)
increase in cash, cash equivalents, and restricted cash
|
|
|
(2,166)
|
|
|
|
266
|
|
Cash, cash
equivalents, and restricted cash at beginning of period
|
|
|
38,554
|
|
|
|
44,197
|
|
Cash, cash
equivalents, and restricted cash at end of period
|
|
$
|
36,388
|
|
|
$
|
44,463
|
|
Reconciliation of Non-GAAP Financial Measures
for the First Quarter 2020
In addition to disclosing financial results that are determined
in accordance with generally accepted accounting principles in
the United States of America
(GAAP), Genie Energy also disclosed for the first quarter 2020, as
well as for comparable periods, pro forma results and Adjusted
EBITDA, which are non-GAAP measures. Generally, a non-GAAP
financial measure is a numerical measure of a company's
performance, financial position, or cash flows that either excludes
or includes amounts that are not normally excluded or included in
the most directly comparable measure calculated and presented in
accordance with GAAP.
Genie Energy's measure of pro forma results consist of the
corresponding GAAP metric with the addition of the corresponding
results for Orbit Energy, the company's joint venture operating in
the United Kingdom. GAAP results
for Orbit Energy are accounted for under the equity method of
accounting. Under this method, Genie Energy records its share in
the net income or loss of the venture. Therefore, revenue
generated, expenses incurred and income from operations are not
reflected in Genie Energy's consolidated revenue and expenses.
However, Orbit Energy's customers are included in metrics regarding
our customer base. Pro forma results are calculated by adding
the result for Orbit Energy to its corresponding GAAP result.
Pro forma results are provided for the first quarter 2020 and first
quarter 2019 to supplement the following results: consolidated
revenue; revenue of the Genie Retail Energy International segment;
and loss from operations for the Genie Retail Energy International
segment.
Genie Energy's measure of Adjusted EBITDA consists of gross
profit less selling, general and administrative expense,
exploration expense and equity in the net loss of in equity method
investees, net, plus depreciation, amortization and stock-based
compensation (which are included in selling, general and
administrative expense). Another way of calculating Adjusted EBITDA
is to start with income from operations and add depreciation,
amortization, stock-based compensation and impairment of goodwill
and subtract equity in net loss in equity method investees,
net.
Management believes that Genie Energy's pro forma results and
Adjusted EBITDA provide useful information to both management and
investors by excluding certain expenses that may not be indicative
of Genie Energy's or the relevant segment's core operating results.
Management uses the pro forma results and Adjusted EBITDA, among
other measures, as relevant indicators of core operational
strengths in its financial and operational decision making. In
addition, management uses and Adjusted EBITDA to evaluate operating
performance in relation to Genie Energy's competitors. Disclosure
of this financial measure may be useful to investors in evaluating
performance and allows for greater transparency to the underlying
supplemental information used by management in its financial and
operational decision-making. In addition, Genie Energy has
historically reported Adjusted EBITDA and believes it is commonly
used by readers of financial information in assessing performance,
therefore the inclusion of comparative numbers provides consistency
in financial reporting at this time.
The pro forma results facilitates evaluation of the results of
all of the company's retail energy provider (REP) businesses as if
they were fully consolidated, which provides useful information
regarding the size, growth and financial performance of all of the
company's REP businesses, In contrast, GAAP results only include
the company's equity in the results of the operations of its U.K.
venture.
Management refers to pro forma results and Adjusted EBITDA, as
well as the GAAP measures revenue, gross profit, income (loss) from
operations and net income (loss), on a segment and/or consolidated
level to facilitate internal and external comparisons to the
segments' and Genie Energy's historical operating results, in
making operating decisions, for budget and planning purposes, and
to form the basis upon which management is compensated.
Although depreciation and amortization are considered operating
costs under GAAP, they primarily represent the non-cash current
period allocation of costs associated with long-lived assets
acquired or constructed in prior periods. While Genie Energy's oil and gas exploration business
may be capital intensive, Genie Energy does not expect to incur
significant depreciation or depletion expense for the foreseeable
future. Genie Energy's operating results exclusive of depreciation
and amortization is therefore a useful indicator of its current
performance.
Stock-based compensation recognized by Genie Energy and other
companies may not be comparable because of the various valuation
methodologies, subjective assumptions and the variety of types of
awards that are permitted under GAAP. Stock-based compensation is
excluded from Genie Energy's calculation of Adjusted EBITDA because
management believes this allows investors to make more meaningful
comparisons of the operating results of Genie Energy's core
business with the results of other companies. However, stock-based
compensation will continue to be a significant expense for Genie
Energy for the foreseeable future and an important part of
employees' compensation that impacts their performance.
Impairment of goodwill is a component of (loss) income from
operations that is excluded from the calculation of Adjusted
EBITDA. The impairment of goodwill is primarily dictated by events
and circumstances outside the control of management that trigger an
impairment analysis. While there may be similar charges in other
periods, the nature and magnitude of these charges can fluctuate
markedly and do not reflect the performance of Genie Energy's
continuing operations.
Pro forma revenue and pro forma income from operations as well
as Adjusted EBITDA should be considered in addition to, not as a
substitute for, or superior to, revenue, gross profit, income from
operations, cash flow from operating activities, net income, basic
and diluted earnings per share or other measures of liquidity and
financial performance prepared in accordance with GAAP. In
addition, Genie Energy's measurements of pro forma revenue, pro
forma income from operations and Adjusted EBITDA may not be
comparable to similarly titled measures reported by other
companies.
Following is the reconciliation of pro forma results and
Adjusted EBITDA to their most directly comparable GAAP
measure. Pro forma consolidated revenue is reconciled to
consolidated revenue, pro forma revenue for the Genie Retail Energy
International segment is reconciled to the segment's revenue, and
Genie Retail Energy International's loss from operations is
reconciled to the segment's loss from operation. Adjusted
EBITDA is reconciled to income from operations for Genie Energy's
reportable segments and net income for Genie Energy on a
consolidated basis.
Reconciliations of
Pro Forma Genie Retail Energy International Segment Revenue
and Loss from Operations to Corresponding GAAP
Results
|
|
|
|
|
|
|
|
|
|
Genie Retail
Energy International (GREI) Segment Results
|
|
|
|
|
|
(results in
millions)
|
|
1Q20
|
|
1Q19
|
|
|
|
|
|
|
|
|
|
|
GREI segment
revenue
|
|
$
7.0
|
|
$
4.8
|
|
|
plus
|
Orbit Energy
revenue
|
|
$
19.6
|
|
$
4.0
|
|
|
Pro forma GREI
segment revenue
|
|
$
26.6
|
|
$
8.8
|
|
|
|
|
|
|
|
|
|
|
GREI segment loss
from operations
|
|
$
(2.5)
|
|
$
(1.7)
|
|
|
plus
|
Orbit Energy loss
from operations
|
|
$
(2.3)
|
|
$
(1.7)
|
|
|
Pro forma GREI
segment loss from operations
|
|
$
(4.8)
|
|
$
(3.4)
|
|
|
|
|
|
|
|
|
|
Reconciliations of
Consolidated Adjusted EBITDA to Net Income Attributable to Genie
Energy Limited and of Adjusted EBITDA to Income from
Operations for All Segments Reported
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
GRE
|
|
GES
|
|
GREI
|
|
GOGAS
|
|
CORP
|
|
Three months ended
March 31, 2020 (1Q20)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Genie Energy Limited
|
$
5,832
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
589
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
6,421
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
2,569
|
|
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
(150)
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
123
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
(128)
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
379
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
$
9,214
|
|
$ 13,017
|
|
$
342
|
|
$ (2,520)
|
|
$
(224)
|
|
$ (1,403)
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
483
|
|
156
|
|
|
|
37
|
|
|
|
291
|
|
|
Depreciation and
amortization
|
826
|
|
112
|
|
208
|
|
490
|
|
15
|
|
|
|
|
Impairment
|
192
|
|
|
|
192
|
|
|
|
|
|
|
|
Subtract:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
379
|
|
|
|
|
|
|
|
260
|
|
119
|
|
Adjusted
EBITDA
|
$ 10,336
|
|
$ 13,285
|
|
$
742
|
|
$ (1,997)
|
|
$
(469)
|
|
$ (1,231)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
GRE
|
|
GES
|
|
GREI
|
|
GOGAS
|
|
CORP
|
|
Three months ended
December 31, 2019 (4Q19)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Genie Energy Limited
|
$
324
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
1,312
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
(988)
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
1,458
|
|
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
(919)
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
150
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
(102)
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
2,724
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
$
2,323
|
|
$
8,235
|
|
$ (1,183)
|
|
$ (3,222)
|
|
$
(200)
|
|
$ (1,307)
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
(4)
|
|
117
|
|
|
|
(226)
|
|
|
|
106
|
|
|
Depreciation and
amortization
|
821
|
|
175
|
|
244
|
|
387
|
|
15
|
|
|
|
|
Impairment
|
400
|
|
|
|
400
|
|
|
|
|
|
|
|
Subtract:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
2,724
|
|
|
|
|
|
2,501
|
|
213
|
|
10
|
|
Adjusted
EBITDA
|
$
816
|
|
$
8,527
|
|
$
(539)
|
|
$ (5,562)
|
|
$
(398)
|
|
$ (1,211)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
GRE
|
|
GES
|
|
GREI
|
|
GOGAS
|
|
CORP
|
|
Three months ended
March 31, 2019 (1Q19)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Genie Energy Limited
|
$
6,069
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
91
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
6,160
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
2,903
|
|
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
(73)
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
140
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
(93)
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
797
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
$
9,834
|
|
$ 13,503
|
|
$
(232)
|
|
$ (1,744)
|
|
$
(163)
|
|
$ (1,531)
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
448
|
|
116
|
|
|
|
94
|
|
|
|
238
|
|
|
Depreciation and
amortization
|
910
|
|
156
|
|
277
|
|
463
|
|
14
|
|
|
|
|
Impairment
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtract:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
797
|
|
|
|
|
|
1,070
|
|
(274)
|
|
|
|
Adjusted
EBITDA
|
$ 10,395
|
|
$ 13,775
|
|
$
45
|
|
$ (2,257)
|
|
$
125
|
|
$ (1,293)
|
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SOURCE Genie Energy Ltd.