GENIE ENERGY LTD. Genie Energy Announces Second Quarter 2021 Results
28% revenue increase driven by customer growth and the consolidation of UK results into Genie Retail
Energy International
Genie Retail US - sustained benefits from elevated consumption even as COVID-19 related door-to-door
channel restrictions relax
Exploring separation of Genie Retail Energy International through a potential spin-off
Newark, NJ - August 5, 2021: Genie Energy, Ltd. (NYSE: GNE, GNEPRA), a leading retail energy provider in deregulated markets in the U.S. and Europe and a provider of renewables solutions in the U.S., today announced results for its second quarter - the three months ended June 30, 2021.
"We generated very strong net income and global customer base expansion in the second quarter driven by organic meter growth in our international operations as they moved towards profitability," said Michael Stein, Chief Executive Officer. "In the U.S., we were encouraged by the durability of the elevated consumption levels we've experienced in recent quarters and by several states moving to reopen for door-to-door marketing, an important sales channel for meter acquisition."
Second Quarter 2021 Highlights
- Revenue of $97.7 million versus $76.1 million in the year-ago quarter;
- Gross profit and gross margin of $23.8 million and 24.3%, respectively, versus $19.5 million and 25.6%, respectively, in the year-ago quarter;
- Income from operations and operating margin of $1.4 million and 1.4%, respectively, versus $2.7 million and 3.6%, respectively, in the year-ago quarter;
- Net income attributable to GNE common stockholders and earnings per share (EPS) of $5.0 million and $0.19 per diluted share versus $1.6 million and $0.06, respectively, in the year-ago quarter. Net income in the second quarter included a gain on the sale of the operations in Japan.
- Adjusted EBITDA1 of $3.1 million versus $3.5 million in the year-ago quarter;
- Re-purchased393,000 shares of GNE common stock.
Select Financial Metrics: Q2 2021 compared to Q2 2020*
(in $M except for EPS) | Q221 | Q220 | Change | |||||
Total Revenue | $97.7 | $76.1 | 28.4% | |||||
Genie Retail - US (GRE) | $67.0 | $66.5 | 0.8% | |||||
Electricity | $61.9 | $61.1 | 1.3% | |||||
Natural Gas | $5.1 | $5.4 | (5.8)% | |||||
Genie Retail - International (GREI) | $28.4 | $5.0 | 463.5% | |||||
Electricity | $21.4 | $4.8 | 343.4% | |||||
Natural Gas | $6.7 | $0.0 | nm | |||||
Genie Renewables | $2.3 | $4.6 | (48.7)% | |||||
Gross Margin | 24.3% | 25.6% | (130bp) | |||||
Genie Retail - US (GRE) | 27.4% | 25.7% | 170bp | |||||
Genie Retail - International (GREI) | 15.9% | 38.0% | (2210bp) | |||||
Genie Renewables | 39.4% | 11.4% | 2800bp | |||||
Income from Operations | $1.4 | $2.7 | (50.3)% | |||||
Operating Margin | 1.4% | 3.6% | -370bp | |||||
Net Income Attributable to Genie Energy Ltd. Common Stockholders | $5.0 | $1.6 | 213.7% | |||||
Diluted Earnings Per Share | $0.19 | $0.06 | $0.13 | |||||
Adjusted EBITDA1 | $3.1 | $3.5 | (11.5)% | |||||
Cash Flow from Operating Activities | $4.1 | $16.4 | (75.0)% | |||||
nm = not measurable/meaningful | ||||||||
*Numbers may not add due to rounding | ||||||||
Select Business Metrics: 2021 versus 2020 as of 6/30/21 | ||||||||
Units in 1000s | Q221 | Q220 | Change | |||||
Retail Performance Metrics: | ||||||||
Retail Customer Equivalents (RCE) | 436 | 418 | 4.3% | |||||
Genie Retail - US (GRE) | 330 | 343 | (3.8)% | |||||
Electricity | 272 | 288 | (5.6)% | |||||
Natural Gas | 58 | 55 | 5.5% | |||||
Genie Retail - International (GREI) | 106 | 76 | 39.5% | |||||
Electricity | 82 | 55 | 49.1% | |||||
Natural Gas | 24 | 21 | 14.3% | |||||
Meters in 1000s units | 554 | 522 | 6.1% | |||||
Genie Retail - US (GRE) | 361 | 374 | (3.5)% | |||||
Electricity | 292 | 311 | (6.1)% | |||||
Natural Gas | 69 | 64 | 7.8% | |||||
Genie Retail - International (GREI) | 193 | 147 | 31.3% | |||||
Electricity | 141 | 105 | 34.3% | |||||
Natural Gas | 52 | 43 | 20.9% | |||||
GRE Average Monthly Churn - Meters | ||||||||
Gross Sales | 35 | 40 | (12.5)% | |||||
Churn | 3.8% | 3.9% | 10bps |
Genie Retail Energy (GRE) delivered solid results for the quarter, driven by continued strong overall consumption within its residential electric meter base. While gross meter acquisitions have not yet returned to pre-COVID levels, churn remained below pre-COVID levels due to remaining restrictions on door-to-door marketing across the industry that lead to fewer customers switching suppliers.
Genie Retail Energy International's (GREI) strong revenue growth was driven by a combination of organic meter growth and the full consolidation of results related to the purchase of the non- controlled interest in Orbit Energy in October 2020, which previously had not been consolidated. This strong growth came despite the revenue impact from the sale of the Company's Japanese operations early in the second quarter of 2021.
Genie Renewables (formerly Genie Energy Services) reported increased gross margin as the segment shifted to higher-margin solar projects. Revenue decreased due to the fulfillment of a large order in the prior year's quarter.
1 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.
Trended Financial Information:*
(in $M except for EPS, RCE and Meters) | Q120 | Q220 | Q320 | Q420 | Q121 | Q221 | 2019 | 2020 | YTD 2021 |
Total Revenue | $104.1 | $76.1 | $96.3 | $102.9 | $135.3 | $97.7 | $315.3 | $379.3 | $233.0 |
Genie Retail - US (GRE) | $79.1 | $66.5 | $88.9 | $69.9 | $90.7 | $67.0 | $286.6 | $305.3 | $157.6 |
Electricity | $63.1 | $61.1 | $86.2 | $60.5 | $73.4 | $61.9 | $246.7 | $271.7 | $135.3 |
Natural Gas | $16.1 | $5.4 | $2.7 | $9.4 | $17.3 | $5.1 | $39.9 | $33.6 | $22.4 |
Genie Retail - International (GREI) | $6.7 | $5.0 | $5.8 | $31.8 | $42.2 | $28.4 | $16.6 | $49.6 | $70.6 |
Electricity | $6.9 | $4.8 | $5.6 | $23.4 | $30.3 | $21.4 | $16.4 | $40.7 | $51.7 |
Natural Gas | $0.0 | $0.0 | $0.0 | $8.3 | $11.8 | $6.7 | $0.0 | $8.3 | $18.5 |
Genie Renewables | $18.0 | $4.6 | $1.6 | $1.1 | $2.5 | $2.3 | $12.1 | $24.4 | $4.8 |
Gross Margin | 27.8% | 25.6% | 28.3% | 21.4% | 12.9% | 24.3% | 26.3% | 25.8% | 17.7% |
Genie Retail - US (GRE) | 43.7% | 25.7% | 29.0% | 25.6% | 16.5% | 27.4% | 28.1% | 28.9% | 20.2% |
Genie Retail - International (GREI) | -4.5% | 38.0% | 19.0% | 13.8% | 3.3% | 15.9% | 1.8% | 14.5% | 8.5% |
Genie Renewables | 8.9% | 11.4% | 27.1% | -29.0% | 44.9% | 39.4% | 15.7% | 9.4% | 42.2% |
Income (loss) from Operations | $9.2 | $2.7 | $8.5 | ($1.1) | ($6.6) | $1.4 | $9.8 | $19.3 | ($5.2) |
Operating Margin | 8.8% | 3.6% | 8.8% | -1.1% | -4.9% | 1.4% | 3.1% | 5.1% | -2.2% |
Net income attributable to Genie Energy Ltd. common stockholders | $5.5 | $1.6 | $6.4 | ($1.7) | ($2.4) | $5.0 | $2.7 | $11.7 | $2.6 |
Diluted Earnings (Loss) Per Share | $0.20 | $0.06 | $0.24 | ($0.06) | ($0.09) | $0.19 | $0.10 | $0.44 | $0.10 |
Cash Flow from Operating Activities | ($2.7) | $16.3 | $10.4 | ($0.9) | ($10.0) | $4.1 | $15.8 | $23.1 | ($5.9) |
Retail Performance Metrics: | |||||||||
Retail Customer Equivalents (RCE) in 1000s | 398 | 418 | 437 | 435 | 446 | 436 | nm | nm | nm |
Genie Retail - US (GRE) | 330 | 343 | 350 | 337 | 347 | 330 | nm | nm | nm |
Electricity | 272 | 288 | 294 | 284 | 291 | 272 | nm | nm | nm |
Natural Gas | 58 | 55 | 56 | 53 | 56 | 58 | nm | nm | nm |
Genie Retail - International (GREI) | 69 | 76 | 87 | 98 | 98 | 106 | nm | nm | nm |
Electricity | 50 | 55 | 66 | 76 | 77 | 82 | nm | nm | nm |
Natural Gas | 19 | 21 | 22 | 21 | 21 | 24 | nm | nm | nm |
Meters in 1000s units | 520 | 522 | 543 | 547 | 555 | 554 | nm | nm | nm |
Genie Retail - US (GRE) | 384 | 374 | 375 | 368 | 373 | 361 | nm | nm | nm |
Electricity | 313 | 311 | 309 | 303 | 308 | 292 | nm | nm | nm |
Natural Gas | 71 | 64 | 67 | 65 | 65 | 69 | nm | nm | nm |
Genie Retail - International (GREI) | 136 | 147 | 167 | 179 | 182 | 193 | nm | nm | nm |
Electricity | 96 | 105 | 121 | 132 | 135 | 141 | nm | nm | nm |
Natural Gas | 40 | 43 | 46 | 47 | 47 | 52 | nm | nm | nm |
Average Monthly Churn - Meters | |||||||||
Genie Retail - US (GRE) | |||||||||
Gross Sales | 69 | 40 | 44 | 59 | 60 | 35 | 308 | 212 | 95 |
Churn | 4.3% | 3.9% | 3.7% | 5.3% | 4.9% | 3.8% | 5.3% | 4.4% | 4.3% |
nm = not measurable/meaningful *Numbers may not add due to rounding
Strategic Update
Genie is conducting a strategic review of its businesses in part to address the different investment profiles of its U.S. and European businesses and to enhance shareholder value across its operations. As one element of this review, the Company is contemplating opportunities to separate GREI from GRE and Genie Renewables through a spin-off of GREI into a separate, publicly-traded entity. If a transaction is consummated, Genie believes that shareholders could benefit from the potential spin-off of GREI with adequate capital and a dedicated management team empowered to gain scale and accelerate growth in its current and prospective European markets. The remaining US operations, GRE and Genie Renewables would then be positioned to accelerate their respective growth plans. Management will provide additional details on its strategic review during today's earnings conference call.
Q2 2021 Commentary from Michael Stein, CEO
"Genie delivered a very strong second quarter with robust top and bottom-line results. As we look to the second half of the year, we are focused on delivering strong cash flow and bottom-line performance. We are encouraged by the improvement in the marketing environment in the US and are confident that we can return to our previous levels of meter growth once all sales channels are fully re-opened. Internationally, following the successful sale of our Japanese operations, we expect our remaining business to continue to drive strong growth while demonstrating improving profitability, which we believe makes GREI an attractive investment on a stand-alone basis. We expect to have more clarity on strategic direction as our plans are finalized."
Earnings Announcement and Supplemental Information
Genie's earnings release will be filed on Form 8-K and posted on the Genie investor relations website (Genie Investor Relations Page) at approximately 7:30 a.m. Eastern on August 5, 2021. Management will host an earnings conference call beginning at 8:30 a.m. Eastern. Management's presentation of the results, outlook and strategy will be followed by Q&A with investors.
To participate in the conference call, dial 1-877-545-0320(toll-free from the US) or 1-973-528-0016 (international) and request the Genie Energy conference call.
Approximately three hours after the call, a call replay will be accessible by dialing 1-877-481-4010 (toll- free from the US) or 1-919-882-2331 (international) and providing the replay PIN: 42242. The replay will remain available through August 19, 2021. A recording of the call also will be available for playback on the "Investors" section of the Genie Energy website.
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 Renewables division comprises Genie Solar
Energy, a provider of end-to-end customized solar solutions primarily for commercial customers, Diversegy, a commercials energy consulting business, CityCom Solar, a provider of community solar energy solutions and Genie's interest in Prism Solar, a supplier of solar panels and 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.
Contact:
Brian Siegel IRC, MBA
Managing Director
Hayden IR
-
396-8696
ir@zedge.net
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Genie Energy Ltd. published this content on 05 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 August 2021 02:55:07 UTC.
