NEWARK, N.J., Nov. 6, 2020 /PRNewswire/ -- Genie Energy Ltd.
(NYSE: GNE, GNEPRA) reported third quarter 2020 earnings of
$0.24 per diluted share on revenue of
$96.3 million.
HIGHLIGHTS
(Throughout this release, 3Q20 results
are compared to 3Q19 results unless otherwise noted)
- By quarter end, Genie had expanded its global customer base to
the highest level in company history. Global RCEs rose to
442,000 and global meters to 558,000, representing year over year
increases of 15% and 13% respectively.
- Consolidated revenue increased 12.4% to $96.3 million driven by increases in average
electricity consumption in the U.S. and internationally. Gross
profit increased 3.7% to $27.3
million while SG&A expense decreased 3.0% to
$18.8 million on reduced customer
acquisition expense.
- Consolidated income from operations increased 22.2% to
$8.5 million. Consolidated
Adjusted EBITDA1 increased 18.6% to $9.5 million.
- Genie Retail Energy, Genie's domestic energy supply business,
increased income from operations to $12.3
million from $10.9 million and
Adjusted EBITDA1 to $12.6
million from $11.2
million.
- Diluted EPS increased to $0.24
from $0.18.
COMMENTS OF MICHAEL STEIN, CEO
"Our strong third
quarter results reflect our long-term investments in customer base
growth and geographic diversification. International meter
acquisitions led the expansion of our global customer base to its
highest level in our history.
"In the U.S., our year over year increases in revenue, gross
profit and income from operations were driven by increased average
per meter electricity consumption. Residential electricity demand
in the U.S. has increased in the COVID-19 era while churn and the
pace of meter acquisition have slowed.
"After the third quarter closed, we acquired our partner's
interest in our U.K. joint venture for $1.7
million. We are excited about the long-term prospects for
this business and expect it to become EBITDA accretive within the
next two years.
"Our bottom line results further strengthened our balance sheet
this quarter even as we continued to invest to grow our
international businesses. By the quarter close, we had
achieved our highest levels of cash and working capital since
2016."
CONSOLIDATED RESULTS
$ in millions,
except EPS
|
3Q20
|
2Q20
|
3Q19
|
|
3Q20-3Q19
Change
(%/$)
|
Revenue
|
$96.3
|
$76.1
|
$85.7
|
|
+12.4%
|
Gross
profit
|
$27.3
|
$19.5
|
$26.4
|
|
+3.6%
|
Gross margin
percentage
|
28.4%
|
25.6%
|
30.7%
|
|
(230) BP
|
SG&A
expense
|
$18.8
|
$16.0
|
$19.4
|
|
(3.0)%
|
Stock-based compensation included in SG&A
|
$0.4
|
$0.4
|
$0.3
|
|
+33.6%
|
Depreciation and
amortization
|
$0.7
|
$0.7
|
$0.9
|
|
(28.1)%
|
Bad debt
expense
|
$1.0
|
$0.6
|
$0.1
|
|
+$0.9
|
Impairment of
assets
|
na
|
$0.8
|
na
|
|
na
|
Income from
operations
|
$8.5
|
$2.7
|
$6.9
|
|
+22.2%
|
Adjusted
EBITDA1
|
$9.5
|
$3.5
|
$8.0
|
|
+18.6%
|
Equity in the net
loss in equity method investees2
|
$(0.1)
|
$(1.2)
|
$(0.2)
|
|
+$0.1
|
Provision for income
taxes
|
$(2.4)
|
$(0.6)
|
$(1.9)
|
|
$(0.5)
|
Net income
attributable to Genie Energy common stockholders
|
$6.4
|
$1.6
|
$4.9
|
|
+$1.5
|
Earnings per diluted
share attributable to Genie Energy common stockholders
|
$0.24
|
$0.06
|
$0.18
|
|
+$0.6
|
Net cash provided by
operating activities
|
$10.4
|
$16.4
|
$12.1
|
|
$(1.7)
|
GLOBAL METERS AND RCEs
Genie Energy's global customer base increased year-over-year and
sequentially driven by Genie International's investment in customer
acquisition complemented by more modest domestic RCE
growth. COVID-19 public health restrictions relaxed in some
Genie domestic markets in the third quarter, facilitating a partial
reactivation of previously curtailed customer acquisition channels.
Genie Energy's global RCE and meter totals are provided in
the chart below.
Global RCEs
and
Meters (in thousands)3
|
September 30,
2020
|
June 30,
2020
|
March 31,
2020
|
December 31,
2019
|
September 30,
2019
|
Electricity
RCEs
|
364
|
346
|
325
|
297
|
309
|
Natural gas
RCEs
|
78
|
75
|
76
|
77
|
75
|
Total
RCEs
|
442
|
421
|
401
|
374
|
384
|
|
|
|
|
|
|
Electricity
meters
|
445
|
429
|
421
|
390
|
392
|
Natural gas
meters
|
113
|
107
|
111
|
107
|
100
|
Total
meters
|
558
|
536
|
532
|
497
|
492
|
SEGMENT RESULTS
Genie Retail Energy (GRE)
Genie Retail
Energy
$ in
millions
|
3Q20
|
2Q20
|
3Q19
|
|
3Q20-3Q19
Change
(%/$)
|
Total
revenue
|
$89.5
|
$66.5
|
$81.7
|
|
+9.6%
|
Electricity revenue
|
$86.2
|
$61.1
|
$78.5
|
|
+9.8%
|
Natural
gas revenue
|
$2.7
|
$5.4
|
$3.2
|
|
(14.1)%
|
Other
|
$0.6
|
-
|
-
|
|
+$0.6
|
Gross
profit
|
$25.9
|
$17.1
|
$25.7
|
|
+1.0%
|
Gross margin
percentage
|
29.0%
|
25.7%
|
31.5%
|
|
(250 BP)
|
SG&A
expense
|
$13.6
|
$11.1
|
$14.8
|
|
(8.4)%
|
Depreciation and amortization
|
$0.1
|
$0.1
|
$0.2
|
|
(37.3)%
|
Income from
operations
|
$12.3
|
$6.0
|
$10.9
|
|
+13.6%
|
Adjusted
EBITDA1
|
$12.6
|
$6.2
|
$11.2
|
|
+13.1%
|
GRE - KPIs and Take-Aways:
- RCEs served at September 30, 2020
increased 6% to 350,000 from 329,000 a year earlier and 2% from
343,000 at June 30, 2020.
- Meters served at September 30,
2020 decreased 4% to 375,000 from 389,000 a year earlier and
increased slightly from 374,000 at June
30, 2020.
- Gross meters added during 3Q20 totaled 44,000 compared to
76,000 in 3Q19 and 40,000 in 2Q20. The year over year decrease
is due to COVID-19 related curtailment of certain customer
acquisition activities.
- Average monthly customer churn decreased to 3.7% from 5.3% in
3Q19 and 3.9% in 2Q20, reflecting decreased sales activity by
competitors and lower rates of gross meter ads in recent quarters –
both as a result of COVID-19-related restrictions on customer
acquisition in certain channels – as well as the continuing
increase in the ratio of fixed rate to variable rate customers,
where fixed rate customers generally have lower rates of
churn.
- The year over year increase in electricity revenue was driven
by a strong increase in average meter electricity consumption
reflecting increased residential demand during the COVID-19
pandemic, and, to a lesser extent, a shift within GRE's electricity
customer base to meters with higher average consumption.
- The year over year increases in income from operations and
Adjusted EBITDA1 were driven by increased per meter
electricity consumption and decreased customer acquisition expense,
offset by a mild decrease in gross margin.
Genie Retail Energy International (GRE
International)
GRE
International
$ in
millions
|
3Q20
|
2Q20
|
3Q19
|
|
3Q20-3Q19
Change
(%/$)
|
Total
revenue
|
$5.8
|
$5.0
|
$3.0
|
|
+91.9%
|
Gross
profit
|
$1.1
|
$1.9
|
$0.4
|
|
+175.8
|
Gross margin
percentage
|
18.7%
|
38.0%
|
13.0%
|
|
+570 BP
|
SG&A
expense
|
$2.7
|
$2.5
|
$2.0
|
|
+36.2%
|
Loss from
operations
|
$(1.6)
|
$(0.6)
|
$(1.6)
|
|
-
|
Adjusted
EBITDA1
|
$(1.0)
|
$(1.6)
|
$(1.0)
|
|
-
|
Equity in the net
loss in Orbit Energy4
|
-
|
$(1.5)
|
-
|
|
-
|
GRE International – KPIs and Take-Aways:
- RCE's served3 at September
30, 2020 increased 69% to 92,000 from 55,000 a year earlier
and increased 18% from 79,000 at June 30,
2020 led by expansion in the U.K. and Scandinavian markets.
- Meters served3 at September
30, 2020 increased 76% to 182,000 from 103,000 a year
earlier and 13% from 161,000 at June 30,
2020.
- On a pro forma basis5, inclusive of Orbit Energy's
revenue, GRE International's revenue increased to $20.9 million from $8.8
million in 3Q19.
- On a pro forma basis5, inclusive of Orbit Energy's
loss from operations, GRE International's loss from operations
increased to $5.8 million from
$4.2 million in 3Q19.
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.
- GES' revenue of $1.0 million was
unchanged from 3Q19.
- GES' loss from operations was $0.7
million compared to a loss from operations of $0.8 million in 3Q19.
Genie Oil and Gas (GOGAS)
- GOGAS' Afek oil and gas exploration subsidiary initiated its
final well test in the second half of October, following the
quarter close.
- GOGAS' loss from operations6 decreased to
$0.1 million from $0.3 million in 3Q19.
Corporate
- Corporate loss from operations was $1.4
million compared to a loss from operations of $1.3 million in 3Q19. The losses include
the impact of corporate stock-based compensation which increased to
$0.2 million from $0.1 million in 3Q19.
BALANCE SHEET AND CASH FLOW HIGHLIGHTS
At
September 30, 2020, Genie Energy had
$148.9 million in total assets.
Cash, cash equivalents and restricted cash increased to
$49.2 million from $41.8 million at June 30,
2020. Liabilities totaled $62.4
million and working capital (current assets less current
liabilities) totaled $54.9 million
compared to $49.1 million at
June 30, 2020.
Cash provided by operating activities in 3Q20 was $10.4 million compared to $12.1 million in 3Q19.
DIVIDEND ON GENIE ENERGY COMMON STOCK
Genie's Board
of Directors has declared a third quarter dividend of $0.085 with a record date of December 4, 2020. The dividend will be paid
on or about December 11,
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 8:30 AM Eastern today, 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:
10149641. The replay will remain available through November 13, 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.
FOOTNOTES:
1 Adjusted EBITDA for all periods
presented is a non-GAAP measure. The 'Reconciliation of
Non-GAAP Financial Measures' at the end of this release provides an
explanation of Adjusted EBITDA and reconciliations to its most
directly comparable GAAP measures.
2Genie Energy accounted 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.
3Includes RCEs and meters acquired and
served by Genie Energy's domestic and international retail energy
provider businesses including operations in Scandinavia and
Japan and at Genie's joint venture
in the U.K. (although U.K. operations have not been included in our
consolidated results of operations).
4Genie Energy accounted 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.
5Pro 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.
6Genie Energy accounts for its minority
interest in Atid, a drilling company based in Israel, under the equity method of accounting
within its GOGAS segment. Atid's revenue generated, and expenses
incurred, are not reflected in segment revenue and operating
expenses.
GENIE ENERGY
LTD. CONSOLIDATED BALANCE SHEETS (in
thousands, except per share amounts)
|
|
September
30,
2020
|
|
|
December 31,
2019
|
|
|
(Unaudited)
|
|
|
|
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
19,556
|
|
|
$
|
31,242
|
|
Restricted
cash—short-term
|
|
29,104
|
|
|
|
6,792
|
|
Trade accounts
receivable, net of allowance for doubtful accounts of $4,285 and
$2,631 at September 30, 2020 and December 31, 2019,
respectively
|
|
44,787
|
|
|
|
49,822
|
|
Inventory
|
|
13,414
|
|
|
|
16,632
|
|
Prepaid
expenses
|
|
4,181
|
|
|
|
6,318
|
|
Other current
assets
|
|
4,271
|
|
|
|
2,133
|
|
Total current
assets
|
|
115,313
|
|
|
|
112,939
|
|
Property and
equipment, net
|
|
357
|
|
|
|
3,607
|
|
Goodwill
|
|
12,213
|
|
|
|
12,135
|
|
Other intangibles,
net
|
|
5,067
|
|
|
|
6,837
|
|
Investment in equity
method investees
|
|
483
|
|
|
|
675
|
|
Restricted
cash—long-term
|
|
570
|
|
|
|
520
|
|
Deferred income tax
assets, net
|
|
7,316
|
|
|
|
12,154
|
|
Other
assets
|
|
7,573
|
|
|
|
7,377
|
|
Total
assets
|
$
|
148,892
|
|
|
$
|
156,244
|
|
Liabilities and
equity
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Loan
payable
|
$
|
1,422
|
|
|
$
|
921
|
|
Trade accounts
payable
|
|
22,889
|
|
|
|
24,387
|
|
Accrued
expenses
|
|
31,326
|
|
|
|
26,116
|
|
Contract
liability
|
|
1,033
|
|
|
|
13,426
|
|
Income taxes
payable
|
|
1,548
|
|
|
|
1,591
|
|
Due to IDT
Corporation, net
|
|
115
|
|
|
|
381
|
|
Short-term revolving
line of credit
|
|
—
|
|
|
|
2,514
|
|
Other current
liabilities
|
|
2,109
|
|
|
|
2,820
|
|
Total current
liabilities
|
|
60,442
|
|
|
|
72,156
|
|
Long-term notes
payable
|
|
—
|
|
|
|
777
|
|
Other
liabilities
|
|
1,952
|
|
|
|
2,381
|
|
Total
liabilities
|
|
62,394
|
|
|
|
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 September 30, 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 September 30, 2020 and December 31,
2019
|
|
16
|
|
|
|
16
|
|
Class B common stock,
$0.01 par value; authorized shares—200,000; 25,808 and 25,785
shares issued and 24,521 and 24,755 shares outstanding at September
30, 2020 and December 31, 2019, respectively
|
|
258
|
|
|
|
258
|
|
Additional paid-in
capital
|
|
140,935
|
|
|
|
139,615
|
|
Treasury stock, at
cost, consisting of 1,287 and 1,030 shares of Class B
common stock at September 30, 2020 and December 31, 2019
|
|
(9,572)
|
|
|
|
(7,675)
|
|
Accumulated other
comprehensive income
|
|
2,800
|
|
|
|
2,519
|
|
Accumulated
deficit
|
|
(52,691)
|
|
|
|
(59,671)
|
|
Total Genie Energy
Ltd. stockholders' equity
|
|
101,489
|
|
|
|
94,805
|
|
Noncontrolling interests
|
|
(14,991)
|
|
|
|
(13,875)
|
|
Total
equity
|
|
86,498
|
|
|
|
80,930
|
|
Total liabilities and
equity
|
$
|
148,892
|
|
|
$
|
156,244
|
|
GENIE ENERGY
LTD. CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
|
2020
|
|
|
2019
|
|
2020
|
|
|
2019
|
|
|
(in thousands,
except per share data)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
Electricity
|
$
|
91,793
|
|
|
$
|
81,473
|
|
$
|
227,671
|
|
|
$
|
196,142
|
|
Natural
gas
|
|
2,724
|
|
|
|
3,169
|
|
|
24,190
|
|
|
|
27,069
|
|
Other
|
|
1,809
|
|
|
|
1,071
|
|
|
24,591
|
|
|
|
10,127
|
|
Total
revenues
|
|
96,326
|
|
|
|
85,713
|
|
|
276,452
|
|
|
|
233,338
|
|
Cost of
revenues
|
|
69,010
|
|
|
|
59,360
|
|
|
200,744
|
|
|
|
172,417
|
|
Gross
profit
|
|
27,316
|
|
|
|
26,353
|
|
|
75,708
|
|
|
|
60,921
|
|
Operating expenses
and losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative (i)
|
|
18,831
|
|
|
|
19,408
|
|
|
54,287
|
|
|
|
53,419
|
|
Impairment of
assets
|
|
—
|
|
|
|
—
|
|
|
993
|
|
|
|
—
|
|
Income from
operations
|
|
8,485
|
|
|
|
6,945
|
|
|
20,428
|
|
|
|
7,502
|
|
Interest
income
|
|
21
|
|
|
|
163
|
|
|
164
|
|
|
|
445
|
|
Interest
expense
|
|
(48)
|
|
|
|
(161)
|
|
|
(223)
|
|
|
|
(479)
|
|
Equity in the net
loss in equity method investees, net
|
|
(146)
|
|
|
|
(238)
|
|
|
(1,698)
|
|
|
|
(2,106)
|
|
Other income
(expense), net
|
|
291
|
|
|
|
(85)
|
|
|
390
|
|
|
|
147
|
|
Income before income
taxes
|
|
8,603
|
|
|
|
6,624
|
|
|
19,061
|
|
|
|
5,509
|
|
Provision for income
taxes
|
|
(2,406)
|
|
|
|
(1,916)
|
|
|
(5,563)
|
|
|
|
(3,142)
|
|
Net income
|
|
6,197
|
|
|
|
4,708
|
|
|
13,498
|
|
|
|
2,367
|
|
Net loss attributable
to noncontrolling interests
|
|
531
|
|
|
|
539
|
|
|
1,026
|
|
|
|
1,484
|
|
Net income
attributable to Genie Energy Ltd.
|
|
6,728
|
|
|
|
5,247
|
|
|
14,524
|
|
|
|
3,851
|
|
Dividends on
preferred stock
|
|
(370)
|
|
|
|
(370)
|
|
|
(1,111)
|
|
|
|
(1,111)
|
|
Net income
attributable to Genie Energy Ltd. common stockholders
|
$
|
6,358
|
|
|
$
|
4,877
|
|
$
|
13,413
|
|
|
$
|
2,740
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Genie Energy Ltd. common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.25
|
|
|
$
|
0.18
|
|
$
|
0.51
|
|
|
$
|
0.10
|
|
Diluted
|
$
|
0.24
|
|
|
$
|
0.18
|
|
$
|
0.50
|
|
|
$
|
0.10
|
|
Weighted-average
number of shares used in calculation of earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
25,928
|
|
|
|
26,683
|
|
|
26,107
|
|
|
|
26,603
|
|
Diluted
|
|
26,769
|
|
|
|
27,669
|
|
|
26,839
|
|
|
|
27,541
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per common share
|
$
|
0.085
|
|
|
$
|
0.075
|
|
$
|
0.245
|
|
|
$
|
0.225
|
|
(i) Stock-based
compensation included in selling, general and administrative
expenses
|
$
|
447
|
|
|
$
|
335
|
|
$
|
1,331
|
|
|
$
|
1,106
|
|
GENIE ENERGY
LTD. CONSOLIDATED STATEMENTS OF CASH
FLOWS
(Unaudited)
|
|
|
Nine Months
Ended
September 30,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
(in
thousands)
|
|
Operating
activities
|
|
|
|
|
|
|
Net income
|
|
$
|
13,498
|
|
|
$
|
2,367
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
2,219
|
|
|
|
2,797
|
|
Impairment of
assets
|
|
|
993
|
|
|
|
—
|
|
Deferred income
taxes
|
|
|
4,838
|
|
|
|
1,591
|
|
Provision for doubtful
accounts receivable
|
|
|
2,209
|
|
|
|
453
|
|
Loss on sale of assets
held for sale
|
|
|
456
|
|
|
|
—
|
|
Stock-based
compensation
|
|
|
1,331
|
|
|
|
1,106
|
|
Equity in the net loss
in equity method investees
|
|
|
1,698
|
|
|
|
2,106
|
|
Gain on
deconsolidation of subsidiaries
|
|
|
(98)
|
|
|
|
—
|
|
Change in assets and
liabilities:
|
|
|
|
|
|
|
|
|
Trade accounts
receivable
|
|
|
2,827
|
|
|
|
(1,607)
|
|
Inventory
|
|
|
3,218
|
|
|
|
264
|
|
Prepaid
expenses
|
|
|
2,166
|
|
|
|
(395)
|
|
Other current assets
and other assets
|
|
|
(633)
|
|
|
|
1,243
|
|
Trade accounts
payable, accrued expenses and other current liabilities
|
|
|
2,018
|
|
|
|
2,152
|
|
Contract
liability
|
|
|
(12,393)
|
|
|
|
3,378
|
|
Due to IDT
Corporation
|
|
|
(266)
|
|
|
|
(81)
|
|
Income taxes
payable
|
|
|
(43)
|
|
|
|
563
|
|
Net cash provided by
operating activities
|
|
|
24,038
|
|
|
|
15,937
|
|
Investing
activities
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(125)
|
|
|
|
(343)
|
|
Proceeds from disposal
of assets held for sale
|
|
|
48
|
|
|
|
—
|
|
Payment for
acquisition of intangible
|
|
|
(298)
|
|
|
|
—
|
|
Investments in equity
method investee
|
|
|
(1,502)
|
|
|
|
(719)
|
|
Payments for business
acquisition, net of cash acquired
|
|
|
—
|
|
|
|
(1,852)
|
|
Investments in notes
receivables
|
|
|
—
|
|
|
|
(214)
|
|
Repayment of notes
receivable
|
|
|
14
|
|
|
|
132
|
|
Net cash used in
investing activities
|
|
|
(1,863)
|
|
|
|
(2,996)
|
|
Financing
activities
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
|
(7,543)
|
|
|
|
(7,220)
|
|
Repayment of
short-term debt—Lumo
|
|
|
—
|
|
|
|
(2,260)
|
|
Proceeds from
exercise of stock options
|
|
|
18
|
|
|
|
1,405
|
|
Proceeds from
revolving line of credit
|
|
|
1,000
|
|
|
|
—
|
|
Repayment of revolving
line of credit
|
|
|
(3,514)
|
|
|
|
—
|
|
Purchase of Class B
common stock from employees upon vesting of restricted
shares
|
|
|
(263)
|
|
|
|
(315)
|
|
Proceeds from
loan
|
|
|
1,395
|
|
|
|
—
|
|
Repayment of loan
payable
|
|
|
(930)
|
|
|
|
—
|
|
Purchases of Class B
common stock
|
|
|
(1,634)
|
|
|
|
(3,415)
|
|
Repayment of notes
payable
|
|
|
(25)
|
|
|
|
(37)
|
|
Net cash used in
financing activities
|
|
|
(11,496)
|
|
|
|
(11,842)
|
|
Effect of exchange
rate changes on cash, cash equivalents, and restricted
cash
|
|
|
(3)
|
|
|
|
12
|
|
Net increase in cash,
cash equivalents, and restricted cash
|
|
|
10,676
|
|
|
|
1,111
|
|
Cash, cash
equivalents, and restricted cash at beginning of period
|
|
|
38,554
|
|
|
|
44,197
|
|
Cash, cash
equivalents, and restricted cash at end of period
|
|
$
|
49,230
|
|
|
$
|
45,308
|
|
Reconciliation of Non-GAAP Financial Measures
for the Third 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 third quarter 2020, as
well as for comparable periods, pro forma revenue and income (loss)
from operations for its Genie Retail Energy International (GRE
International) segment and, for on a consolidated basis and for all
segments, 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 measures 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 (loss) from operations are
not reflected in Genie Energy's consolidated revenue and expenses
(although 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 third quarter 2020 and third quarter 2019 to supplement the
following results: 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.
Pro forma revenue and pro forma income (loss) from operations
are used specifically to evaluate the performance of its GRE
International division. Management also used Adjusted EBITDA
to evaluate operating performance in relation to Genie Energy's
competitors. Disclosure of these non-GAAP 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 facilitate evaluation of the results of
GRE International as if the results of its U.K joint venture, Orbit
Energy, were fully consolidated, which provides useful information
regarding the size, growth and financial performance of GRE
International businesses in aggregate. 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 (loss) 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 (loss) from operations and Adjusted EBITDA may not be
comparable to similarly titled measures reported by other
companies.
Following are the reconciliations of GRE International's pro
forma results and Adjusted EBITDA to its most directly comparable
GAAP measure. Pro forma revenue for the GRE International
segment is reconciled to the segment's revenue, and GRE
International's pro forma 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.
Reconciliation of pro forma GRE International revenue and
loss from operations
|
|
|
|
|
|
|
|
|
|
|
|
Genie Retail
Energy International (GREI) Segment Results
|
|
|
|
|
|
|
|
(results in
millions)
|
|
3Q20
|
|
3Q19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GREI segment
revenue
|
|
$
5.8
|
|
$
3.0
|
|
|
|
|
plus
|
Orbit Energy
revenue
|
|
$
15.1
|
|
$
5.8
|
|
|
|
|
Pro forma GREI
segment revenue
|
|
$
20.9
|
|
$
8.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GREI segment loss
from operations
|
|
$
(1.6)
|
|
$
(1.6)
|
|
|
|
|
plus
|
Orbit Energy loss
from operations
|
|
$
(4.2)
|
|
$
(2.6)
|
|
|
|
|
Pro forma GREI
segment loss from operations
|
|
$
(5.8)
|
|
$
(4.2)
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted EBITDA
|
|
|
|
Total
|
|
GRE
|
|
GES
|
|
GREI
|
|
GOGAS
|
|
CORP
|
|
|
|
|
|
Three months ended
September 30, 2020 (3Q20)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Genie Energy Limited
|
$
6,728
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
(531)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
6,197
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
2,406
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
(291)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
(21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
146
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
$
8,485
|
|
$12,333
|
|
$
(719)
|
|
$(1,574)
|
|
$
(146)
|
|
$(1,409)
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
447
|
|
172
|
|
|
|
68
|
|
|
|
207
|
|
|
|
|
|
|
Depreciation and
amortization
|
670
|
|
117
|
|
11
|
|
527
|
|
15
|
|
|
|
|
|
|
|
|
Impairment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtract:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
146
|
|
|
|
|
|
|
|
143
|
|
3
|
|
|
|
|
|
Adjusted
EBITDA
|
$
9,456
|
|
$12,622
|
|
$
(708)
|
|
$
(979)
|
|
$
(274)
|
|
$(1,205)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
GRE
|
|
GES
|
|
GREI
|
|
GOGAS
|
|
CORP
|
|
|
|
|
|
Three months ended
June 30, 2020 (2Q20)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Genie Energy Limited
|
$
1,963
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
(1,083)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
880
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
587
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expenses,
net
|
52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
58
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
(20)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
1,173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
$
2,730
|
|
$
5,957
|
|
$ (1,113)
|
|
$
(607)
|
|
$
(172)
|
|
$(1,335)
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
401
|
|
175
|
|
|
|
14
|
|
|
|
213
|
|
|
|
|
|
|
Depreciation and
amortization
|
722
|
|
118
|
|
95
|
|
495
|
|
14
|
|
|
|
|
|
|
|
|
Impairment
|
801
|
|
|
|
801
|
|
|
|
|
|
|
|
|
|
|
|
Subtract:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
1,173
|
|
|
|
|
|
1,502
|
|
(224)
|
|
(105)
|
|
|
|
|
|
Adjusted
EBITDA
|
$
3,481
|
|
$
6,250
|
|
$
(217)
|
|
$ (1,600)
|
|
$
66
|
|
$(1,017)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
GRE
|
|
GES
|
|
GREI
|
|
GOGAS
|
|
CORP
|
|
|
|
|
|
Three months ended
September 30, 2019 (3Q19)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Genie Energy Limited
|
$
5,247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
(539)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
4,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
1,916
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
85
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
161
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
(163)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
238
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
$
6,945
|
|
$10,856
|
|
$
(798)
|
|
$(1,560)
|
|
$
(283)
|
|
$(1,270)
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
335
|
|
116
|
|
|
|
94
|
|
|
|
125
|
|
|
|
|
|
|
Depreciation and
amortization
|
933
|
|
187
|
|
243
|
|
488
|
|
15
|
|
|
|
|
|
|
|
|
Impairment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtract:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in the net
loss of equity method investees
|
238
|
|
|
|
|
|
|
|
148
|
|
90
|
|
|
|
|
|
Adjusted
EBITDA
|
$
7,975
|
|
$11,159
|
|
$
(555)
|
|
$
(978)
|
|
$
(416)
|
|
$(1,235)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/genie-energy-ltd-reports-third-quarter-2020-results-301167708.html
SOURCE Genie Energy Ltd.