GNE Genie Energy Ltd

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): November 6, 2024

 

 

GENIE ENERGY LTD.

(Exact name of registrant as specified in its charter)

 

 

Delaware		1-35327		45-2069276
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

520 Broad Street Newark, New Jersey		07102
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (973) 438-3500

 

Not Applicable

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):  

 

☐

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b)-2 of the Exchange Act:

 

Title of each class		Trading Symbol		Name of each exchange on which registered
Class B common stock, par value $.01 per share		GNE		New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). 

 

Emerging growth company   ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ☐

 

 

 

Item 2.02. Results of Operations and Financial Condition.

 

On November 6, 2024, the Registrant distributed over a wire service and posted to the investor relations page of its website (www.genie.com), an earnings release announcing its results of operations for the quarter ended September 30, 2024. A copy of the earnings release concerning the foregoing results is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

 

The Registrant is furnishing the information contained in this Report, including Exhibit 99.1, pursuant to Item 2.02 of Form 8-K promulgated by the Securities and Exchange Commission (the “SEC”). This information shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC unless otherwise expressly stated in such filing. In addition, this Report and the press release contain statements intended as “forward-looking statements” that are subject to the cautionary statements about forward-looking statements set forth in the press release. 

 

Item 9.01 Financial Statements and Exhibits.

 

(d)

Exhibits.

 

Exhibit No.		Document
99.1		Press Release, dated November 6, 2024, reporting the results of operations for the quarter ended September 30, 2024.
104		Cover Pager Interactive Data File, formatted in Inline XBRL document.

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	GENIE ENERGY LTD.
	By:	/s/ Michael Stein
		Name:	Michael Stein
		Title:	Chief Executive Officer

 

Dated: November 6, 2024

 

 

EXHIBIT INDEX

 

Exhibit Number		Document
99.1		Press Release, dated November 6, 2024, reporting the results of operations for the quarter ended September 30, 2024.
104		Cover Pager Interactive Data File, formatted in Inline XBRL document.

 

 

Exhibit 99.1

 

 

Genie Energy Announces Third Quarter 2024 Results

 

 

Newark, NJ – November 6, 2024: Genie Energy, Ltd. (NYSE: GNE), a leading retail energy and renewable energy solutions provider, today announced results for the third quarter of 2024. 

 

Michael Stein, chief executive officer of Genie Energy, commented: 

"Our third quarter featured strong operational and financial results consistent with our performance in recent quarters.  We are on track to deliver the high end of our full year Adjusted EBITDA guidance of $40 to $50 million. 

"At GRE, our retail energy business, we added 36,000 net new meters during the quarter driven by organic sales activity and a large aggregation deal.  Electricity and gas margins remained robust, while slightly milder summer weather contributed to a reduction in per-meter electricity consumption.  The decrease in per-meter consumption in combination with increased sales costs drove comparative, year-over-year decreases in revenue and profitability.  Looking ahead, we have begun the process of entering the California gas market as we continue to diversify our geographic footprint, and see generally favorable meter acquisition and operating environments across our retail markets. 

"We have been strategically repositioning GREW, our renewables business, for stronger top line growth and improved operating margins. That effort began to pay off this quarter. Diversegy, our energy advisory and brokerage business, nearly doubled revenue year over year and turned Adjusted EBITDA¹ positive.  At Genie Solar, we are tightening our focus on the utility scale solar generation market and moving away from commercial and industrial generation projects. This shift enabled us to lock in strong gross profits, which increased exponentially compared to the year ago quarter, while significantly reducing SG&A expense. We also further expanded Genie Solar’s development pipeline, gaining site control for an additional six projects while moving another to the permitting stage.  All in, GREW delivered outstanding third quarter results." 

 

Third Quarter 2024 Highlights

(Unless otherwise noted, 3Q24 results are compared to 3Q23, and results of Genie Retail Energy International (GREI) are included in discontinued operations for all periods.) 

 

 

Select Financial Metrics

 

Segment Highlights

 

Genie Retail Energy (GRE)

GRE's third quarter revenue decreased 12.1% to $105.8 million from $120.3 million last year. Income from operations decreased 31.6% to $15.0 million from $22.0 million, and Adjusted EBITDA decreased 30.7% to $15.5 million from $22.3 million.  The decreases reflected a lower level of per meter electricity consumption, driven by milder weather compared to 3Q23, and an increase in customer acquisition activity and expense, partially offset by a slight increase in revenue per kWh sold.

GRE Operational Metrics

 

Genie Renewables (GREW)

GREW's third quarter revenue increased 29.2% to $6.1 million from $4.7 million last year, driven by results from Diversegy, which nearly doubled its revenue compared to 3Q23, completion of various Genie Solar commercial and industrial solar generation projects for third parties, and by revenue from the operational solar arrays that Genie Solar acquired late last year.

GREW's loss from operations decreased to $0.2 million from $2.1 million in 3Q23, and Adjusted EBITDA loss decreased to $24 thousand from $2.0 million.

At September 30, 2024, Genie Solar's operating portfolio and development pipeline comprised:

 

During the quarter, portfolio and pipeline net additions totaled 21 MW and 6 projects.

Balance Sheet and Cash Flow Highlights

 

As of September 30, 2024, Genie reported cash and cash equivalents, short and long-term restricted cash, and marketable equity securities of $191.7 million.

 

Total assets as of September 30, 2024 were $341.7 million. Liabilities totaled $141.4 million, and working capital (current assets less current liabilities) totaled $138.8 million. 

 

Cash provided by operating activities decreased to $22.9 million in 3Q24 from $28.0 million in 3Q23.

 

Trended Financial Information^*

Earnings Announcement and Supplemental Information

At 8:30 AM Eastern this morning, Genie Energy’s management will host a conference call to discuss the Company's 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 1-877-545-0523 (toll-free from the US) or 1-973-528-0016 (international) and provide the following participant access code: 644435.

 

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 passcode: 51441 .. The replay will remain available through Wednesday, November 20, 2024. In addition, a recording of the call will be available for playback on the “Investors” section of the Genie Energy website.

 

About Genie Energy Ltd.

 

Genie Energy Ltd., (NYSE: GNE) is a leading retail energy and renewable energy solutions provider. The Genie Retail Energy division (GRE) supplies electricity, including electricity from renewable resources, and natural gas to residential and small business customers in the United States. The Genie Renewables division's (GREW) holdings include Genie Solar, a vertically-integrated provider of community and utility-scale solar energy solutions, and Diversegy, an energy procurement advisor. 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

 

Avi Goldin

Chief Financial Officer

Genie Energy, Ltd.

agoldin@genie.com

 

GENIE ENERGY LTD.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

GENIE ENERGY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

GENIE ENERGY LTD. 

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) 

Reconciliation of Non-GAAP Financial Measures for the Third Quarter of 2024

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 disclosed Adjusted EBITDA on a consolidated basis and for GRE and disclosed Non-GAAP Net Income Attributable to Genie Energy Ltd. Common Stockholders (Non-GAAP Net Income and Non-GAAP earnings per share (Non-GAAP EPS). Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS are non-GAAP financial 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’s measure of consolidated Adjusted EBITDA starts with income from operations and adds back depreciation, amortization, and stock-based compensation and deducts impairment of assets and equity in the net loss of equity method investees, net.

Genie's measure of Non-GAAP Net Income starts with net income attributable to Genie Energy Ltd. Common Stockholders in accordance with GAAP and adds captive insurance liability and the tax effect of this adjustment. These additions  are non-cash and/or non-routine items in the relevant periods.

 

Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS 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’s measurement of Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS may not be comparable to similarly titled measures reported by other companies.

 

Management believes that Genie’s measure of Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS provide useful information to both management and investors by excluding certain expenses that may not be indicative of Genie’s or GRE’s core operating results. Management uses Adjusted EBITDA, non-GAAP Net Income and Non-GAAP EPS, among other measures, as relevant indicators of core operational strengths in its financial and operational decision-making.

 

Management also uses Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS to evaluate operating performance in relation to Genie’s competitors. Disclosure of these non-GAAP financial measures 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.

 

Management refers to Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS as well as the GAAP measures revenue, gross profit, and income from operations, as well as net income, on a consolidated level to facilitate internal and external comparisons to Genie'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. Genie’s operating results exclusive of depreciation and amortization are therefore useful indicators 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’s calculation of Adjusted EBITDA because management believes this allows investors to make more meaningful comparisons of the operating results of Genie’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 assets is a component of income (loss) from operations that is excluded from the calculation of Adjusted EBITDA. The impairment of assets 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's continuing operations. 

Captive insurance liability is a non-cash charge incurred by Genie's insurance operations. While there may be related charges in other periods, the magnitude of these changes can fluctuate markedly and do not reflect the performance of Genie's continuing operations. Captive insurance losses are excluded from Genie's calculation of Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS because management believes this allows investors to make more meaningful comparisons of the operating results of Genie’s core business with the results of other companies. 

 

Following are the reconciliations of Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS on a consolidated basis to its most directly comparable GAAP measure. Adjusted EBITDA is reconciled to income from operations for Genie Energy on a consolidated basis as well as for GRE. 

 

Non-GAAP Reconciliation - Consolidated Adjusted EBITDA

 

 

Non-GAAP Reconciliation - GRE Adjusted EBITDA

 

 Non-GAAP Reconciliation - Consolidated Non-GAAP Net Income Attributable to Genie Energy Ltd. Common Stockholders and Non-GAAP Diluted Income Per Share