Market Overview

Genie Energy Ltd. Reports Third Quarter 2019 Results

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NEWARK, N.J., Nov. 8, 2019 /PRNewswire/ -- Genie Energy Ltd. (NYSE:GNE, GNEPRA)) reported third quarter 2019 net income of $0.18 per share on revenue of $85.7 million.

Genie Energy is a leading provider of electricity and natural gas to homes and small businesses in the Eastern U.S. Genie also operates an E&P company with an active exploratory program in Northern Israel.

FINANCIAL AND OPERATIONAL HIGHLIGHTS

(Throughout this release, 3Q19 results are compared to 3Q18 results unless otherwise noted)

  • Global customer base increased by 27 thousand RCEs (+8%) to 384 thousand RCEs and by 45 thousand meters (+10%) to 492 thousand meters during 3Q19;
  • Average monthly churn was 5.3% - a decrease from 5.7% in 3Q18 and an increase from 4.4% in 2Q19;
  • Genie Retail Energy (GRE) commenced customer acquisition in Texas - the largest deregulated electricity market in the U.S.;
  • Prism Solar, a supplier of solar panels in which Genie holds a majority stake, received significant additional orders from JP Morgan Chase for facilities around the nation pursuant to an existing preferred supplier agreement;
  • Consolidated revenue increased 19.3% to $85.7 million from $71.8 million;
  • Consolidated income from operations was $6.9 million and Adjusted EBITDA* was $8.0 million, both results unchanged from 3Q18;
  • During the quarter, Genie Energy repurchased 470,147 shares of its Class B common stock, approximately 1.7% of shares outstanding, for $3.4 million;
  • Genie Energy's Board of Directors has declared a third quarter 2019 dividend of $0.075 per share.

COMMENTS OF MICHAEL STEIN, CEO

"Across the Company, Genie Energy continued its strong performance with a solid third quarter. Domestically, we increased our customer base within our existing markets and entered a huge new deregulated market – Texas, with over seven million addressable meters. Internationally, we continued our rapid expansion. Within our energy services division, Prism Solar is rapidly expanding its business through its solar panel supply agreement with JP Morgan Chase.  Our robust financial results and strong balance sheet enabled us to repurchase over 470 thousand shares of our outstanding common stock during the third quarter for $3.4 million while maintaining our quarterly dividend."

CONSOLIDATED RESULTS

$ in millions, except EPS

3Q19

2Q19

3Q18


3Q19 -3Q18

Change (%/$)

Revenue

$85.7

$61.0

$71.8


+19.3%

Gross profit

$26.4

$9.0

$21.3


+23.9%

Gross margin percentage

30.7%

14.7%

29.6%


+110 BP

SG&A expense (including stock-based compensation)

$19.4

$18.2

$13.9


+39.2%

Stock-based compensation included in SG&A

$0.3

$0.3

$1.1


$(0.8)

Research and development

-

$0.1

-


-

Write-down of assets held for sale to fair value

-

-

$0.5


$(0.5)

Depreciation and amortization

$0.9

$0.9

$0.5


+$0.4

Income (loss) from operations 

$6.9

$(9.3)

$6.9


NC

Adjusted EBITDA*

$8.0

$(9.1)

$8.0


NC

Equity in the net loss in equity method investees**

$(0.2)

$(1.1)

$(0.9)


+$0.6

(Provision for) benefit from income taxes

$(1.9)

$1.7

$(0.7)


$(1.2)

Net income (loss) attributable to Genie Energy common stockholders

$4.9

$(7.8)

$5.5


$(0.6)

Earnings (loss) per share attributable to Genie Energy common stockholders

$0.18

$(0.29)

$0.21


$(0.03)

Net cash provided by (used in) operating activities

$12.1

$(3.1)

$8.2


+$3.9

*Adjusted EBITDA for all periods 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 Measure at the end of this release for an explanation of Adjusted EBITDA and reconciliation to the most directly comparable GAAP measure.

* * Genie Energy accounts for its investments in Orbit Energy, its joint venture operating in the U.K. and Atid, a drilling services business 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, but the customers are included in metrics regarding our customer base.

METERS AND RCEs

Genie Energy's global customer base increased sequentially and year-over-year driven by investment in customer acquisition in U.S. and overseas markets.  Genie Energy's global RCE and meter totals are provided in the chart below.

Global RCEs and
Meters at End of
Quarter (in thousands)*

September 30,
2019

June 30,
2019

March 31,
2019

December 31,
2018

September 30,
2018

Electricity RCEs

309

290

271

197

216

Natural gas RCEs

75

67

62

59

59

Total RCEs

384

357

333

256<

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