Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2021 | May 04, 2021 | |
Class of Stock [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-36559 | |
Entity Registrant Name | Spark Energy, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-5453215 | |
Entity Address, Address Line One | 12140 Wickchester Ln | |
Entity Address, Address Line Two | Suite 100 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77079 | |
City Area Code | 713 | |
Local Phone Number | 600-2600 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001606268 | |
Current Fiscal Year End Date | --12-31 | |
Common Class A | ||
Class of Stock [Line Items] | ||
Title of 12(b) Security | Class A common stock, par value $0.01 per share | |
Trading Symbol | SPKE | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 14,627,284 | |
Common Class B | ||
Class of Stock [Line Items] | ||
Entity Common Stock, Shares Outstanding | 20,800,000 | |
Series A preferred stock | ||
Class of Stock [Line Items] | ||
Title of 12(b) Security | 8.75% Series A Fixed-to-Floating RateCumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share | |
Trading Symbol | SPKEP | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 3,567,543 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 81,491 | $ 71,684 |
Accounts receivable, net of allowance for doubtful accounts of $2,698 at March 31, 2021 and $3,942 at December 31, 2020 | 55,671 | 70,350 |
Accounts receivable—affiliates | 5,264 | 5,053 |
Inventory | 131 | 1,496 |
Fair value of derivative assets | 1,678 | 311 |
Customer acquisition costs, net | 3,774 | 5,764 |
Customer relationships, net | 11,526 | 12,077 |
Deposits | 6,434 | 5,655 |
Renewable energy credit asset | 22,343 | 20,666 |
Other current assets | 12,089 | 11,818 |
Total current assets | 200,401 | 204,874 |
Property and equipment, net | 3,456 | 3,354 |
Fair value of derivative assets | 61 | 0 |
Customer acquisition costs, net | 207 | 306 |
Customer relationships, net | 3,200 | 5,691 |
Deferred tax assets | 33,025 | 27,960 |
Goodwill | 120,343 | 120,343 |
Other assets | 3,634 | 4,139 |
Total assets | 364,327 | 366,667 |
Current liabilities: | ||
Accounts payable | 25,243 | 27,322 |
Accounts payable—affiliates | 1,259 | 826 |
Accrued liabilities | 29,702 | 34,164 |
Renewable energy credit liability | 20,932 | 19,549 |
Fair value of derivative liabilities | 3,219 | 7,505 |
Other current liabilities | 1,265 | 1,295 |
Total current liabilities | 81,620 | 90,661 |
Long-term liabilities: | ||
Fair value of derivative liabilities | 175 | 227 |
Long-term portion of Senior Credit Facility | 135,000 | 100,000 |
Subordinated debt—affiliate | 10,000 | 0 |
Other long-term liabilities | 7 | 30 |
Total liabilities | 226,802 | 190,918 |
Commitments and Contingencies | ||
Series A Preferred Stock, par value $0.01 per share, 20,000,000 shares authorized, 3,707,256 shares issued and 3,567,543 shares outstanding at March 31, 2021 and December 31, 2020 | 87,288 | 87,288 |
Stockholders' equity: | ||
Additional paid-in capital | 52,904 | 55,222 |
Accumulated other comprehensive loss | (40) | (40) |
Retained earnings | 2,139 | 11,721 |
Treasury stock, at cost, 144,594 shares at March 31, 2021 at December 31, 2020 | (2,406) | (2,406) |
Total stockholders' equity | 52,954 | 64,854 |
Non-controlling interest in Spark HoldCo, LLC | (2,717) | 23,607 |
Total equity | 50,237 | 88,461 |
Total liabilities, Series A Preferred Stock and Stockholders' equity | 364,327 | 366,667 |
Common Class A | ||
Stockholders' equity: | ||
Common Stock | 148 | 148 |
Common Class B | ||
Stockholders' equity: | ||
Common Stock | $ 209 | $ 209 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Preferred stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares issued (in shares) | 3,707,256 | 3,707,256 |
Preferred stock, shares outstanding (in shares) | 3,567,543 | 3,567,543 |
Treasury stock, at cost (in shares) | 144,594 | 144,594 |
Trade Accounts Receivable | ||
Allowance for doubtful accounts | $ 2,698 | $ 3,942 |
Common Class A | ||
Common stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, shares issued (in shares) | 14,771,878 | 14,771,878 |
Common stock, shares outstanding (in shares) | 14,627,284 | 14,627,284 |
Common Class B | ||
Common stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 60,000,000 | 60,000,000 |
Common stock, shares issued (in shares) | 20,800,000 | 20,800,000 |
Common stock, shares outstanding (in shares) | 20,800,000 | 20,800,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues: | ||
Retail revenues | $ 113,145 | $ 166,360 |
Net asset optimization (expense) revenues | (140) | 321 |
Total Revenues | 113,005 | 166,681 |
Operating Expenses: | ||
Retail cost of revenues | 122,168 | 118,823 |
General and administrative | 12,671 | 25,676 |
Depreciation and amortization | 6,036 | 8,796 |
Total Operating Expenses | 140,875 | 153,295 |
Operating (loss) income | (27,870) | 13,386 |
Other (expense)/income: | ||
Interest expense | (1,311) | (1,553) |
Interest and other income | 86 | 160 |
Total other expenses | (1,225) | (1,393) |
(Loss) income before income tax (benefit) expense | (29,095) | 11,993 |
Income tax (benefit) expense | (1,535) | 1,925 |
Net (loss) income | (27,560) | 10,068 |
Less: Net (loss) income attributable to non-controlling interests | (19,929) | 5,589 |
Net (loss) income attributable to Spark Energy, Inc. stockholders | (7,631) | 4,479 |
Less: Dividends on Series A Preferred Stock | 1,951 | 1,500 |
Net (loss) income attributable to stockholders of Class A common stock | $ (9,582) | $ 2,979 |
Net income attributable to Spark Energy, Inc. per share of Class A common stock | ||
Basic (in dollars per share) | $ (0.66) | $ 0.21 |
Diluted (in dollars per share) | $ (0.66) | $ 0.20 |
Weighted average shares of Class A common stock outstanding | ||
Basic (in shares) | 14,627 | 14,381 |
Diluted (in shares) | 14,627 | 14,784 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative effect adjustment | Adjusted balance | Total Stockholders' Equity | Total Stockholders' EquityCumulative effect adjustment | Total Stockholders' EquityAdjusted balance | Common Stock | Treasury Stock | Treasury StockAdjusted balance | Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive LossAdjusted balance | Additional Paid-in Capital | Additional Paid-in CapitalAdjusted balance | Retained Earnings (Deficit) | Retained Earnings (Deficit)Cumulative effect adjustment | Retained Earnings (Deficit)Adjusted balance | Non-controlling Interest | Non-controlling InterestAdjusted balance | Common Class ACommon Stock | Common Class ACommon StockAdjusted balance | Common Class BCommon Stock | Common Class BCommon StockAdjusted balance |
Balance at beginning of period (in shares) at Dec. 31, 2019 | 99 | 99 | 14,479 | 14,479 | 20,800 | 20,800 | ||||||||||||||||
Balance at beginning of period at Dec. 31, 2019 | $ 67,286 | $ (633) | $ 66,653 | $ 51,219 | $ (633) | $ 50,586 | $ (2,011) | $ (2,011) | $ (40) | $ (40) | $ 51,842 | $ 51,842 | $ 1,074 | $ (633) | $ 441 | $ 16,067 | $ 16,067 | $ 145 | $ 145 | $ 209 | $ 209 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||
Stock based compensation | 1,329 | 1,329 | 1,329 | |||||||||||||||||||
Restricted stock unit vesting (in shares) | 16 | |||||||||||||||||||||
Restricted stock unit vesting | (39) | (39) | (39) | |||||||||||||||||||
Consolidated net loss | 10,068 | 4,479 | 4,479 | 5,589 | ||||||||||||||||||
Distributions paid to non-controlling unit holders | (7,172) | (7,172) | ||||||||||||||||||||
Dividends paid to Class A common stockholders ($0.18125 per share) | (2,606) | (2,606) | (2,606) | |||||||||||||||||||
Dividends paid to Preferred Stockholders | (1,500) | (1,500) | (1,500) | |||||||||||||||||||
Changes in ownership interest | 0 | (422) | (422) | 422 | ||||||||||||||||||
Balance at end of period (in shares) at Mar. 31, 2020 | 99 | 14,495 | 20,800 | |||||||||||||||||||
Balance at end of period at Mar. 31, 2020 | 66,733 | 51,827 | $ (2,011) | (40) | 52,710 | 814 | 14,906 | $ 145 | $ 209 | |||||||||||||
Balance at beginning of period (in shares) at Dec. 31, 2020 | 144 | 14,772 | 20,800 | |||||||||||||||||||
Balance at beginning of period at Dec. 31, 2020 | 88,461 | 64,854 | $ (2,406) | (40) | 55,222 | 11,721 | 23,607 | $ 148 | $ 209 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||
Stock based compensation | 377 | 377 | 377 | |||||||||||||||||||
Consolidated net loss | (27,560) | (7,631) | (7,631) | (19,929) | ||||||||||||||||||
Distributions paid to non-controlling unit holders | (6,439) | (6,439) | ||||||||||||||||||||
Dividends paid to Class A common stockholders ($0.18125 per share) | (2,651) | (2,651) | (2,651) | |||||||||||||||||||
Dividends paid to Preferred Stockholders | (1,951) | (1,951) | (1,951) | |||||||||||||||||||
Changes in ownership interest | 0 | (44) | (44) | 44 | ||||||||||||||||||
Balance at end of period (in shares) at Mar. 31, 2021 | 144 | 14,772 | 20,800 | |||||||||||||||||||
Balance at end of period at Mar. 31, 2021 | $ 50,237 | $ 52,954 | $ (2,406) | $ (40) | $ 52,904 | $ 2,139 | $ (2,717) | $ 148 | $ 209 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Parenthetical) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (27,560) | $ 10,068 |
Adjustments to reconcile net income to net cash flows provided by operating activities: | ||
Depreciation and amortization expense | 6,036 | 8,796 |
Deferred income taxes | (5,065) | (468) |
Stock based compensation | 467 | 1,324 |
Amortization of deferred financing costs | 259 | 250 |
Bad debt expense | (247) | 2,355 |
Loss on derivatives, net | (7,024) | 24,587 |
Current period cash settlements on derivatives, net | 1,185 | (16,293) |
Changes in assets and liabilities: | ||
Decrease in accounts receivable | 14,926 | 30,847 |
Increase in accounts receivables—affiliates | (211) | (905) |
Decrease in inventory | 1,365 | 2,690 |
Increase in customer acquisition costs | (213) | (1,345) |
Increase in prepaid and other current assets | (3,012) | (11,967) |
Decrease in intangible assets—customer acquisition | 27 | 0 |
Decrease in other assets | 254 | 289 |
Decrease in accounts payable and accrued liabilities | (5,271) | (10,892) |
Increase (decrease) in accounts payable—affiliates | 433 | (75) |
Increase in other current liabilities | 41 | 149 |
Decrease in other non-current liabilities | (22) | (21) |
Net cash (used) provided in operating activities | (23,632) | 39,389 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (520) | (536) |
Net cash used in investing activities | (520) | (536) |
Cash flows from financing activities: | ||
Buyback of Series A Preferred Stock | 0 | (1,222) |
Borrowings on notes payable | 191,000 | 75,000 |
Payments on notes payable | (156,000) | (103,000) |
Net borrowings on subordinated debt facility | 10,000 | 0 |
Restricted stock vesting | 0 | (39) |
Payment of dividends to Class A common stockholders | (2,651) | (2,606) |
Payment of distributions to non-controlling unitholders | (6,439) | (7,172) |
Payment of Preferred Stock dividends | (1,951) | (2,011) |
Net cash provided (used) in financing activities | 33,959 | (41,050) |
Increase (decrease) in Cash, cash equivalents and Restricted cash | 9,807 | (2,197) |
Cash, cash equivalents and Restricted cash—beginning of period | 71,684 | 57,668 |
Cash, cash equivalents and Restricted cash—end of period | 81,491 | 55,471 |
Non-cash items: | ||
Property and equipment purchase accrual | 23 | 55 |
Cash paid (received) during the period for: | ||
Interest | 889 | 1,327 |
Taxes | $ (361) | $ 465 |
Formation and Organization
Formation and Organization | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Formation and Organization | 1. Formation and Organization Organization We are an independent retail energy services company that provides residential and commercial customers in competitive markets across the United States with an alternative choice for natural gas and electricity. Spark Energy, Inc. (the “Company”) is a holding company whose sole material asset consists of units in Spark HoldCo, LLC (“Spark HoldCo”). The Company is the sole managing member of Spark HoldCo, is responsible for all operational, management and administrative decisions relating to Spark HoldCo’s business and consolidates the financial results of Spark HoldCo and its subsidiaries. Spark HoldCo is the direct and indirect owner of the subsidiaries through which we operate. We conduct our business through several brands across our service areas, including Electricity Maine, Electricity N.H., Major Energy, Provider Power Massachusetts, Respond Power, Spark Energy, and Verde Energy. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying interim unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC") as it applies to interim financial statements. This information should be read along with our consolidated financial statements and notes contained in our annual report on Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”). Our unaudited condensed consolidated financial statements are presented on a consolidated basis and include all wholly-owned and controlled subsidiaries. We account for investments over which we have significant influence but not a controlling financial interest using the equity method of accounting. All significant intercompany transactions and balances have been eliminated in the unaudited condensed consolidated financial statements. In the opinion of the Company's management, the accompanying condensed consolidated financial statements reflect all adjustments that are necessary to fairly present the financial position, the results of operations, the changes in equity and the cash flows of the Company for the respective periods. Such adjustments are of a normal recurring nature, unless otherwise disclosed. Use of Estimates and Assumptions The preparation of our condensed consolidated financial statements requires estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim financial statements and the reported amounts of revenues and expenses during the period. Actual results could materially differ from those estimates. Relationship with our Founder and Majority Shareholder W. Keith Maxwell, III (our "Founder") is the Company's Chief Executive Officer, a director, and the owner of a majority of the voting power of our common stock through his ownership of NuDevco Retail, LLC ("NuDevco Retail") and Retailco, LLC ("Retailco"). Retailco is a wholly owned subsidiary of TxEx Energy Investments, LLC ("TxEx"), which is wholly owned by Mr. Maxwell. NuDevco Retail is a wholly owned subsidiary of NuDevco Retail Holdings LLC ("NuDevco Retail Holdings"), which is a wholly owned subsidiary of Electric HoldCo, LLC, which is also a wholly owned subsidiary of TxEx. New Accounting Standards Recently Adopted There have been no changes to our significant accounting policies as disclosed in our 2020 Form 10-K, except as follows: In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes ("ASU 2019-12"). These amendments simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. For public business entities, the amendments in ASU 2019-12 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. We adopted ASU 2019-12 effective January 1, 2021 and the adoption did not have a material impact on our consolidated financial statements. Standards Being Evaluated/Standards Not Yet Adopted Below are accounting standards that have been issued by the FASB but have not yet been adopted by the Company at March 31, 2021. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting ("ASU 2020-04"). The amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform ("ASU 2021-01"), which clarifies the scope and application of certain optional expedients and exceptions regarding the original guidance. The amendments in these ASUs were effective upon issuance and can be applied prospectively through December 31, 2022. The Company's Senior Credit Facility is the only agreement that makes reference to a LIBOR rate and the agreement outlines the specific procedures that will be undertaken once an appropriate alternative benchmark is identified.We do not expect adoption of the new standard to have a material impact to our consolidated financial statements. |
Revenues
Revenues | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | 3. Revenues Our revenues are derived primarily from the sale of natural gas and electricity to customers, including affiliates. Revenue is measured based upon the quantity of gas or power delivered at prices contained or referenced in the customer's contract, and excludes any sales incentives (e.g. rebates) and amounts collected on behalf of third parties (e.g. sales tax). Our revenues also include asset optimization activities. Asset optimization activities consist primarily of purchases and sales of gas that meet the definition of trading activities per FASB ASC Topic 815, Derivatives and Hedging. They are therefore excluded from the scope of FASB ASC Topic 606, Revenue from Contracts with Customers. Revenues for electricity and natural gas sales are recognized under the accrual method when our performance obligation to a customer is satisfied, which is the point in time when the product is delivered and control of the product passes to the customer. Electricity and natural gas products may be sold as fixed-price or variable-price products. The typical length of a contract to provide electricity and/or natural gas is twelve months. Customers are billed and typically pay at least monthly, based on usage. Electricity and natural gas sales that have been delivered but not billed by period end are estimated and recorded as accrued unbilled revenues based on estimates of customer usage since the date of the last meter read provided by the utility. Volume estimates are based on forecasted volumes and estimated residential and commercial customer usage. Unbilled revenues are calculated by multiplying these volume estimates by the applicable rate by customer class (residential or commercial). Estimated amounts are adjusted when actual usage is known and billed. The following table discloses revenue by primary geographical market, customer type, and customer credit risk profile (in thousands). The table also includes a reconciliation of the disaggregated revenue to revenue by reportable segment (in thousands). Reportable Segments Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 Retail Electricity Retail Natural Gas Total Reportable Segments Retail Electricity Retail Natural Gas Total Reportable Segments Primary markets (a) New England $ 26,241 $ 4,377 $ 30,618 $ 46,593 $ 7,054 $ 53,647 Mid-Atlantic 28,550 13,455 42,005 45,842 15,804 61,646 Midwest 11,059 10,238 21,297 14,989 13,607 28,596 Southwest 12,905 6,320 19,225 14,344 8,127 22,471 $ 78,755 $ 34,390 $ 113,145 $ 121,768 $ 44,592 $ 166,360 Customer type Commercial $ 15,216 $ 11,516 $ 26,732 $ 40,015 $ 15,517 $ 55,532 Residential 73,272 26,490 99,762 93,228 33,363 126,591 Unbilled revenue (b) (9,733) (3,616) (13,349) (11,475) (4,288) (15,763) $ 78,755 $ 34,390 $ 113,145 $ 121,768 $ 44,592 $ 166,360 Customer credit risk POR $ 50,850 $ 19,600 $ 70,450 $ 84,913 $ 23,037 $ 107,950 Non-POR 27,905 14,790 42,695 36,855 21,555 58,410 $ 78,755 $ 34,390 $ 113,145 $ 121,768 $ 44,592 $ 166,360 (a) The primary markets include the following states: • New England - Connecticut, Maine, Massachusetts, New Hampshire; • Mid-Atlantic - Delaware, Maryland (including the District of Colombia), New Jersey, New York and Pennsylvania; • Midwest - Illinois, Indiana, Michigan and Ohio; and • Southwest - Arizona, California, Colorado, Florida, Nevada, and Texas. (b) Unbilled revenue is recorded in total until it is actualized, at which time it is categorized between commercial and residential customers. We record gross receipts taxes on a gross basis in retail revenues and retail cost of revenues. During the three months ended March 31, 2021 and 2020, our retail revenues included gross receipts taxes of $0.3 million and $0.3 million, respectively, and our retail cost of revenues included gross receipts taxes of $1.2 million and $1.7 million, respectively. Accounts receivables and Allowance for Credit Losses The Company conducts business in many utility service markets where the local regulated utility purchases our receivables, and then becomes responsible for billing the customer and collecting payment from the customer (“POR programs”). These POR programs result in substantially all of the Company’s credit risk being linked to the applicable utility, which generally has an investment-grade rating, and not to the end-use customer. The Company monitors the financial condition of each utility and currently believes its receivables are collectible. In markets that do not offer POR programs or when the Company chooses to directly bill its customers, certain receivables are billed and collected by the Company. The Company bears the credit risk on these accounts and records an appropriate allowance for doubtful accounts to reflect any losses due to non-payment by customers. The Company’s customers are individually insignificant and geographically dispersed in these markets. The Company writes off customer balances when it believes that amounts are no longer collectible and when it has exhausted all means to collect these receivables. For trade accounts receivables, the Company accrues an allowance for doubtful accounts by business segment by pooling customer accounts receivables based on similar risk characteristics, such as customer type, geography, aging analysis, payment terms, and related macro-economic factors. Expected credit loss exposure is evaluated for each of our accounts receivables pools. Expected credits losses are established using a model that considers historical collections experience, current information, and reasonable and supportable forecasts. The Company writes off accounts receivable balances against the allowance for doubtful accounts when the accounts receivable is deemed to be uncollectible. A rollforward of our allowance for credit losses for the three months ended March 31, 2021 are presented in the table below (in thousands): Balance at December 31, 2020 $ (3,942) Current period bad debt provision 490 Write-offs 934 Recovery of previous write offs (180) Balance at March 31, 2021 $ (2,698) |
Equity
Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Equity | 4. Equity Non-controlling Interest We hold an economic interest and are the sole managing member in Spark HoldCo, with affiliates of our Founder holding the remaining economic interests in Spark HoldCo. As a result, we consolidate the financial position and results of operations of Spark HoldCo, and reflect the economic interests owned by these affiliates as a non-controlling interest. The Company and affiliates owned the following economic interests in Spark HoldCo at March 31, 2021 and December 31, 2020, respectively. The Company Affiliated Owners March 31, 2021 41.53 % 58.47 % December 31, 2020 41.53 % 58.47 % The following table summarizes the portion of net (loss) income and income tax expense (benefit) attributable to non-controlling interest (in thousands): Three Months Ended March 31, 2021 2020 Net (loss) income allocated to non-controlling interest $ (18,321) $ 6,085 Income tax expense allocated to non-controlling interest 1,608 496 Net (loss) income attributable to non-controlling interest $ (19,929) $ 5,589 Class A Common Stock and Class B Common Stock Holders of the Company's Class A common stock and Class B common stock vote together as a single class on all matters presented to our stockholders for their vote or approval, except as otherwise required by applicable law or by our certificate of incorporation. Dividends on Class A Common Stock Dividends declared for the Company's Class A common stock are reported as a reduction of retained earnings, or a reduction of additional paid in capital to the extent retained earnings are exhausted. During the three months ended March 31, 2021, we paid $2.7 million in dividends to the holders of the Company's Class A common stock. This dividend represented a quarterly rate of $0.18125 per share on each share of Class A common stock. Dividends declared for the Company's Class A common stock are reported as a reduction of retained earnings, or additional paid in capital in the case retained earnings is exhausted. In order to pay our stated dividends to holders of our Class A common stock, our subsidiary, Spark HoldCo is required to make corresponding distributions to holders of its units, including those holders that own our Class B common stock (our non-controlling interest holder). As a result, during the three months ended March 31, 2021, Spark HoldCo made corresponding distributions of $3.8 million to our non-controlling interest holders. Share Repurchase Program On August 18, 2020, our Board of Directors authorized a share repurchase program of up to $20.0 million of Class A common stock through August 18, 2021. Purchases may be made with available cash balances, our Senior Credit Facility and operating cash flows. The shares of Class A common stock may be repurchased from time to time in the open market at prevailing market prices or in privately negotiated transactions based on ongoing assessments of capital needs, the market price of the stock, and other factors, including general market conditions. The repurchase program does not obligate us to acquire any particular amount of Class A common stock, may be modified or suspended at any time, and could be terminated prior to completion. During the three months ended March 31, 2021, we did not repurchase our Class A common stock. The share repurchase program was suspended in March 2021 pursuant to an agreement with lenders under our Senior Credit Facility. Earnings Per Share Basic earnings per share (“EPS”) is computed by dividing net income attributable to stockholders (the numerator) by the weighted-average number of Class A common shares outstanding for the period (the denominator). Class B common shares are not included in the calculation of basic earnings per share because they are not participating securities and have no economic interests. Diluted earnings per share is similarly calculated except that the denominator is increased by potentially dilutive securities. The following table presents the computation of basic and diluted income (loss) per share for the three months ended March 31, 2021 and 2020 (in thousands, except per share data): Three Months Ended March 31, 2021 2020 Net (loss) income attributable to Spark Energy, Inc. stockholders $ (7,631) $ 4,479 Less: Dividends on Series A preferred stock 1,951 1,500 Net (loss) income attributable to stockholders of Class A common stock $ (9,582) $ 2,979 Basic weighted average Class A common shares outstanding 14,627 14,381 Basic (loss) income per share attributable to stockholders $ (0.66) $ 0.21 Net (loss) income attributable to stockholders of Class A common stock $ (9,582) $ 2,979 Effect of conversion of Class B common stock to shares of Class A common stock — — Diluted net (loss) income attributable to stockholders of Class A common stock $ (9,582) $ 2,979 Basic weighted average Class A common shares outstanding 14,627 14,381 Effect of dilutive Class B common stock — — Effect of dilutive restricted stock units — 403 Diluted weighted average shares outstanding 14,627 14,784 Diluted (loss) income per share attributable to stockholders $ (0.66) $ 0.20 The computation of diluted earnings per share for the three months ended March 31, 2021 and 2020 excludes 20.8 million shares of Class B common stock because the effect of their conversion was antidilutive. The Company's outstanding shares of Series A Preferred Stock were not included in the calculation of diluted earnings per share because they contain only contingent redemption provisions that have not occurred. Variable Interest Entity Spark HoldCo is a variable interest entity due to its lack of rights to participate in significant financial and operating decisions and its inability to dissolve or otherwise remove its management. Spark HoldCo owns all of the outstanding membership interests in each of our operating subsidiaries. We are the sole managing member of Spark HoldCo, manage Spark HoldCo's operating subsidiaries through this managing membership interest, and are considered the primary beneficiary of Spark HoldCo. The assets of Spark HoldCo cannot be used to settle our obligations except through distributions to us, and the liabilities of Spark HoldCo cannot be settled by us except through contributions to Spark HoldCo. The following table includes the carrying amounts and classification of the assets and liabilities of Spark HoldCo that are included in our condensed consolidated balance sheet as of March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 December 31, 2020 Assets Current assets: Cash and cash equivalents $ 81,290 $ 71,442 Accounts receivable 55,671 70,350 Other current assets 56,390 55,575 Total current assets 193,351 197,367 Non-current assets: Goodwill 120,343 120,343 Other assets 13,182 15,259 Total non-current assets 133,525 135,602 Total Assets $ 326,876 $ 332,969 Liabilities Current liabilities: Accounts payable and accrued liabilities $ 54,883 $ 61,436 Other current liabilities 44,228 43,676 Total current liabilities 99,111 105,112 Long-term liabilities: Long-term portion of Senior Credit Facility 135,000 100,000 Subordinated debt — affiliate 10,000 — Other long-term liabilities 183 256 Total long-term liabilities 145,183 100,256 Total Liabilities $ 244,294 $ 205,368 |
Preferred Stock
Preferred Stock | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Preferred Stock | 5. Preferred Stock Holders of the Series A Preferred Stock have no voting rights, except in specific circumstances of delisting or in the case the dividends are in arrears as specified in the Series A Preferred Stock Certificate of Designations. The Series A Preferred Stock accrue dividends at an annual percentage rate of 8.75%, and the liquidation preference provisions of the Series A Preferred Stock are considered contingent redemption provisions because there are rights granted to the holders of the Series A Preferred Stock that are not solely within our control upon a change in control of the Company. Accordingly, the Series A Preferred Stock is presented between liabilities and the equity sections in the accompanying condensed consolidated balance sheet. During the three months ended March 31, 2021, we paid $2.0 million in dividends to holders of the Series A Preferred Stock. As of March 31, 2021, we had accrued $2.0 million related to dividends to holders of the Series A Preferred Stock. This dividend was paid on April 15, 2021. A summary of our preferred equity balance for the three months ended March 31, 2021 is as follows: (in thousands) Balance at December 31, 2020 $ 87,288 Repurchase of Series A Preferred Stock — Accumulated dividends on Series A Preferred Stock — Balance at March 31, 2021 $ 87,288 |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | 6. Derivative Instruments We are exposed to the impact of market fluctuations in the price of electricity and natural gas, basis differences in the price of natural gas, storage charges, renewable energy credits ("RECs"), and capacity charges from independent system operators. We use derivative instruments in an effort to manage our cash flow exposure to these risks. These instruments are not designated as hedges for accounting purposes, and, accordingly, changes in the market value of these derivative instruments are recorded in the cost of revenues. As part of our strategy to optimize pricing in our natural gas related activities, we also manage a portfolio of commodity derivative instruments held for trading purposes. Our commodity trading activities are subject to limits within our Risk Management Policy. For these derivative instruments, changes in the fair value are recognized currently in earnings in net asset optimization revenues. Derivative assets and liabilities are presented net in our condensed consolidated balance sheets when the derivative instruments are executed with the same counterparty under a master netting arrangement. Our derivative contracts include transactions that are executed both on an exchange and centrally cleared, as well as over-the-counter, bilateral contracts that are transacted directly with third parties. To the extent we have paid or received collateral related to the derivative assets or liabilities, such amounts would be presented net against the related derivative asset or liability’s fair value. As of March 31, 2021 and December 31, 2020, we paid less than $0.1 million and $0.1 million in collateral to net against the related derivative liability's fair value. The specific types of derivative instruments we may execute to manage the commodity price risk include the following: • Forward contracts, which commit us to purchase or sell energy commodities in the future; • Futures contracts, which are exchange-traded standardized commitments to purchase or sell a commodity or financial instrument; • Swap agreements, which require payments to or from counterparties based upon the differential between two prices for a predetermined notional quantity; and • Option contracts, which convey to the option holder the right but not the obligation to purchase or sell a commodity. The Company has entered into other energy-related contracts that do not meet the definition of a derivative instrument or for which we made a normal purchase, normal sale election and are therefore not accounted for at fair value including the following: • Forward electricity and natural gas purchase contracts for retail customer load; • Renewable energy credits; and • Natural gas transportation contracts and storage agreements. Volumes Underlying Derivative Transactions The following table summarizes the net notional volumes of our open derivative financial instruments accounted for at fair value by commodity. Positive amounts represent net buys while bracketed amounts are net sell transactions (in thousands): Non-trading Commodity Notional March 31, 2021 December 31, 2020 Natural Gas MMBtu 2,183 2,880 Electricity MWh 1,843 1,845 Trading Commodity Notional March 31, 2021 December 31, 2020 Natural Gas MMBtu 105 102 Gains (Losses) on Derivative Instruments Three Months Ended March 31, 2021 2020 Gain (Loss) on non-trading derivatives, net $ 7,054 $ (24,533) Loss on trading derivatives, net (30) (54) Gain (Loss) on derivatives, net 7,024 (24,587) Current period settlements on non-trading derivatives (1) $ (1,189) $ 16,609 Current period settlements on trading derivatives 4 (1) Total current period settlements on derivatives $ (1,185) $ 16,608 ( 1) Excludes settlements of $(0.3) million, for the three months ended March 31, 2020 related to power call options. Gains (losses) on trading derivative instruments are recorded in net asset optimization revenues and gains (losses) on non-trading derivative instruments are recorded in retail cost of revenues on the condensed consolidated statements of operations. Fair Value of Derivative Instruments The following tables summarize the fair value and offsetting amounts of our derivative instruments by counterparty and collateral received or paid (in thousands): March 31, 2021 Description Gross Assets Gross Net Assets Cash Net Amount Non-trading commodity derivatives $ 3,759 $ (2,094) $ 1,665 $ — $ 1,665 Trading commodity derivatives 14 (1) 13 — 13 Total Current Derivative Assets 3,773 (2,095) 1,678 — 1,678 Non-trading commodity derivatives 233 (172) 61 — 61 Trading commodity derivatives — — — — — Total Non-current Derivative Assets 233 (172) 61 — 61 Total Derivative Assets $ 4,006 $ (2,267) $ 1,739 $ — $ 1,739 Description Gross Gross Net Cash Net Amount Non-trading commodity derivatives $ (6,623) $ 3,394 $ (3,229) $ 13 $ (3,216) Trading commodity derivatives (3) — (3) — (3) Total Current Derivative Liabilities (6,626) 3,394 (3,232) 13 (3,219) Non-trading commodity derivatives (490) 315 (175) — (175) Trading commodity derivatives — — — — — Total Non-current Derivative Liabilities (490) 315 (175) — (175) Total Derivative Liabilities $ (7,116) $ 3,709 $ (3,407) $ 13 $ (3,394) December 31, 2020 Description Gross Assets Gross Net Assets Cash Net Amount Non-trading commodity derivatives $ 308 $ (105) $ 203 $ — $ 203 Trading commodity derivatives 112 (4) 108 — 108 Total Current Derivative Assets 420 (109) 311 — 311 Non-trading commodity derivatives — — — — — Trading commodity derivatives — — — — — Total Non-current Derivative Assets — — — — — Total Derivative Assets $ 420 $ (109) $ 311 $ — $ 311 Description Gross Gross Net Cash Net Amount Non-trading commodity derivatives $ (11,139) $ 3,620 $ (7,519) $ 86 $ (7,433) Trading commodity derivatives (74) 2 (72) — (72) Total Current Derivative Liabilities (11,213) 3,622 (7,591) 86 (7,505) Non-trading commodity derivatives (838) 611 (227) — (227) Trading commodity derivatives — — — — — Total Non-current Derivative Liabilities (838) 611 (227) — (227) Total Derivative Liabilities $ (12,051) $ 4,233 $ (7,818) $ 86 $ (7,732) |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 7. Property and Equipment Property and equipment consist of the following (in thousands): Estimated useful March 31, 2021 December 31, 2020 Information technology 2 – 5 $ 5,307 $ 5,821 Furniture and fixtures 2 – 5 957 957 Total 6,264 6,778 Accumulated depreciation (2,808) (3,424) Property and equipment—net $ 3,456 $ 3,354 Information technology assets include software and consultant time used in the application, development and implementation of various systems including customer billing and resource management systems. As of each of March 31, 2021 and December 31, 2020, information technology includes $0.8 million and $0.7 million, respectively, of costs associated with assets not yet placed into service. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 8. Intangible Assets Goodwill, customer relationships and trademarks consist of the following amounts (in thousands): March 31, 2021 December 31, 2020 Goodwill $ 120,343 $ 120,343 Customer relationships—Acquired Cost $ 58,688 $ 58,688 Accumulated amortization (46,445) (44,175) Customer relationships — Acquired $ 12,243 $ 14,513 Customer relationships—Other Cost $ 8,898 $ 8,988 Accumulated amortization (6,415) (5,733) Customer relationships — Other, net $ 2,483 $ 3,255 Trademarks Cost $ 7,570 $ 7,570 Accumulated amortization (3,249) (2,972) Trademarks, net $ 4,321 $ 4,598 Changes in goodwill, customer relationships (including non-compete agreements) and trademarks consisted of the following (in thousands): Goodwill Customer Relationships — Acquired Customer Relationships — Other Trademarks Balance at December 31, 2020 $ 120,343 $ 14,513 $ 3,255 $ 4,598 Adjustments — — (28) — Amortization — (2,270) (744) (277) Balance at March 31, 2021 $ 120,343 $ 12,243 $ 2,483 $ 4,321 Estimated future amortization expense for customer relationships and trademarks at March 31, 2021 is as follows (in thousands): Year ending December 31, 2021 (remaining nine months) $ 9,823 2022 6,194 2023 605 2024 404 2025 404 > 5 years 1,617 Total $ 19,047 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | 9. Debt Debt consists of the following amounts as of March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 December 31, 2020 Long-term debt: Senior Credit Facility (1) (2) $ 135,000 $ 100,000 Subordinated Debt 10,000 — Total long-term debt 145,000 100,000 Total debt $ 145,000 $ 100,000 (1) As of March 31, 2021 and December 31, 2020, the weighted average interest rate on the Senior Credit Facility was 3.75% and 3.75%, respectively. (2) As of March 31, 2021 and December 31, 2020, we had $29.7 million and $31.0 million in letters of credit issued, respectively. Capitalized financing costs associated with our Senior Credit Facility were $1.4 million and $1.6 million as of March 31, 2021 and December 31, 2020, respectively. Of these amounts, $1.0 million and $1.0 million are recorded in other current assets, and $0.4 million and $0.6 million are recorded in other non-current assets in the condensed consolidated balance sheets as of March 31, 2021 and December 31, 2020, respectively. Interest expense consists of the following components for the periods indicated (in thousands): Three Months Ended March 31, 2021 2020 Senior Credit Facility $ 468 $ 911 Letters of credit fees and commitment fees 402 392 Amortization of deferred financing costs 259 250 Other 182 — Interest Expense $ 1,311 $ 1,553 Senior Credit Facility The Company, as guarantor, and Spark HoldCo (the “Borrower” and, together with each subsidiary of Spark HoldCo (“Co-Borrowers”)) maintain a senior secured borrowing base credit facility (as amended from time to time, “Senior Credit Facility”) that allows us to borrow on a revolving basis and has a maximum borrowing capacity of $227.5 million as of March 31, 2021. Subject to applicable sub-limits and terms of the Senior Credit Facility, borrowings are available for the issuance of letters of credit (“Letters of Credit”), working capital and general purpose revolving credit loans (“Working Capital Loans”), and share buyback loans (“Share Buyback Loans”). The Senior Credit Facility will mature on July 31, 2022 , and all amounts outstanding thereunder will be payable on the maturity date. Borrowings under the Senior Credit Facility may be used to pay fees and expenses in connection with the Senior Credit Facility, finance ongoing working capital requirements and general corporate purpose requirements of the Co-Borrowers, to provide partial funding for acquisitions, as allowed under terms of the Senior Credit Facility, and to make open market purchases of our Class A common stock and Series A Preferred Stock. The Senior Credit Facility provides for Share Buyback Loans of up to $80.0 million, which permit the Company to repurchase up to an aggregate of 8,000,000 shares of Class A common stock or $80.0 million of Series A Preferred Stock, however this provision was suspended in March 2021 pursuant to an agreement with lenders under the Senior Credit Facility. Pursuant to the Senior Credit Facility, the interest rate for Working Capital Loans and Letters of Credit under the Senior Credit Facility is generally determined by reference to the Eurodollar rate plus an applicable margin of up to 3.25% per annum (based on the prevailing utilization) or an alternate base rate plus an applicable margin of up to 2.25% per annum (based on the prevailing utilization). The alternate base rate is equal to the highest of (i) the prime rate (as published in the Wall Street Journal), (ii) the federal funds rate plus 0.50% per annum, or (iii) the reference Eurodollar rate plus 1.00%. Borrowings under the Senior Credit Facility for Share Buyback Loans, are generally determined by reference to the Eurodollar rate plus an applicable margin of 4.50% per annum or the alternate base rate plus an applicable margin of 3.50% per annum. The Co-Borrowers pay a commitment fee of 0.50% quarterly in arrears on the unused portion of the Senior Credit Facility. In addition, the Co-Borrowers are subject to additional fees including an upfront fee, an annual agency fee, and letter of credit fees based on a percentage of the face amount of letters of credit payable to any syndicate member that issues a letter of credit. The Senior Credit Facility contains covenants that, among other things, require the maintenance of specified ratios or conditions including: • Minimum Fixed Charge Coverage Ratio . We must maintain a minimum fixed charge coverage ratio of not less than 1.25 to 1.00. The Minimum Fixed Charge Coverage Ratio is defined as the ratio of (a) Adjusted EBITDA to (b) the sum of consolidated (with respect to the Company and the Co-Borrowers) interest expense, letter of credit fees, commitment fees, acquisition earn-out payments (excluding earnout payments funded with proceeds from newly issued preferred or common equity), distributions, scheduled amortization payments, and payments made on or after the closing of the Fourth Amendment to the Senior Credit Facility (other than such payments made from escrow accounts which were funded in connection with a permitted acquisition) related to the settlement of civil and regulatory matters if not included in the calculation of Adjusted EBITDA. Our Minimum Fixed Charge Coverage Ratio as of March 31, 2021 was 1.48 to 1.00. • Maximum Total Leverage Ratio . We must maintain a ratio of (x) the sum of total indebtedness (excluding eligible subordinated debt and letter of credit obligations), plus (y) gross amounts reserved for civil and regulatory liabilities identified in SEC filings, to Adjusted EBITDA of no more than 2.50 to 1.00. Our Maximum Total Leverage Ratio as of March 31, 2021 was 1.45 to 1.00. • Maximum Senior Secured Leverage Ratio . We must maintain a Senior Secured Leverage Ratio of no more than 1.85 to 1.00. The Senior Secured Leverage Ratio is defined as the ratio of (a) all indebtedness of the loan parties on a consolidated basis that is secured by a lien on any property of any loan party (including the effective amount of all loans then outstanding under the Senior Credit Facility) to (b) Adjusted EBITDA. Our Maximum Senior Secured Leverage Ratio as of March 31, 2021 was 1.24 to 1.00. The Senior Credit Facility contains various negative covenants that limit our ability to, among other things, incur certain additional indebtedness, grant certain liens, engage in certain asset dispositions, merge or consolidate, make certain payments, distributions, investments, acquisitions or loans, materially modify certain agreements, or enter into transactions with affiliates. The Senior Credit Facility also contains affirmative covenants that are customary for credit facilities of this type. As of March 31, 2021, we were in compliance with our various covenants under the Senior Credit Facility. The Senior Credit Facility is secured by pledges of the equity of the portion of Spark HoldCo owned by us, the equity of Spark HoldCo’s subsidiaries, the Co-Borrowers’ present and future subsidiaries, and substantially all of the Co-Borrowers’ and their subsidiaries’ present and future property and assets, including accounts receivable, inventory and liquid investments, and control agreements relating to bank accounts. We are entitled to pay cash dividends to the holders of the Series A Preferred Stock and Class A common stock and will be entitled to repurchase up to an aggregate amount of 10,000,000 shares of our Class A common stock, and up to $92.7 million of Series A Preferred Stock through one or more normal course open market purchases through NASDAQ so long as: (a) no default exists or would result therefrom; (b) the Co-Borrowers are in pro forma compliance with all financial covenants before and after giving effect thereto; and (c) the outstanding amount of all loans and letters of credit does not exceed the borrowing base limits. The share repurchase program was suspended in March 2021 pursuant to an agreement with lenders under our Senior Credit Facility. The Senior Credit Facility contains certain customary representations and warranties and events of default. Events of default include, among other things, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults and cross-acceleration to certain indebtedness, certain events of bankruptcy, certain events under ERISA, material judgments in excess of $5.0 million, certain events with respect to material contracts, and actual or asserted failure of any guaranty or security document supporting the Senior Credit Facility to be in full force and effect. A default will also occur if at any time W. Keith Maxwell III ceases to, directly or indirectly, own at least 13,600,000 Class A and Class B shares on a combined basis (to be adjusted for any stock split, subdivisions or other stock reclassification or recapitalization), and a controlling percentage of the voting equity interest of the Company, and certain other changes in control. If such an event of default occurs, the lenders under the Senior Credit Facility would be entitled to take various actions, including the acceleration of amounts due under the facility and all actions permitted to be taken by a secured creditor. Subordinated Debt Facility The Company maintains an Amended and Restated Subordinated Promissory Note in the principal amount of up to $25.0 million (the “Subordinated Debt Facility”), by and among the Company, Spark HoldCo and Retailco. The Subordinated Debt Facility matures on January 31, 2023. The Subordinated Debt Facility allows us to draw advances in increments of no less than $1.0 million per advance up to the maximum principal amount of the Subordinated Debt Facility. Advances thereunder accrue interest at 5% per annum from the date of the advance. We have the right to capitalize interest payments under the Subordinated Debt Facility. The Subordinated Debt Facility is subordinated in certain respects to our Senior Credit Facility pursuant to a subordination agreement. We may pay interest and prepay principal on the Subordinated Debt Facility so long as we are in compliance with the covenants under our Senior Credit Facility, are not in default under the Senior Credit Facility and have minimum availability of $5.0 million under the borrowing base under the Senior Credit Facility. Payment of principal and interest under the Subordinated Debt Facility is accelerated upon the occurrence of certain change of control or sale transactions. As of March 31, 2021, and December 31, 2020, there were $10.0 million and zero outstanding borrowings under the Subordinated Debt Facility. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 10. Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants at the measurement date. Fair values are based on assumptions that market participants would use when pricing an asset or liability, including assumptions about risk and the risks inherent in valuation techniques and the inputs to valuations. This includes the credit standing of counterparties involved and the impact of credit enhancements. We apply fair value measurements to our commodity derivative instruments based on the following fair value hierarchy, which prioritizes the inputs to the valuation techniques used to measure fair value into three broad levels: • Level 1—Quoted prices in active markets for identical assets and liabilities. Instruments categorized in Level 1 primarily consist of financial instruments such as exchange-traded derivative instruments. • Level 2—Inputs other than quoted prices recorded in Level 1 that are either directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived from observable market data by correlation or other means. Instruments categorized in Level 2 primarily include non-exchange traded derivatives such as over-the-counter commodity forwards and swaps and options. • Level 3—Unobservable inputs for the asset or liability, including situations where there is little, if any, observable market activity for the asset or liability. As the fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3), the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. These levels can change over time. In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. In these cases, the lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in the fair value hierarchy. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following tables present assets and liabilities measured and recorded at fair value in our condensed consolidated balance sheets on a recurring basis by and their level within the fair value hierarchy (in thousands): Level 1 Level 2 Level 3 Total March 31, 2021 Non-trading commodity derivative assets $ — $ 1,726 $ — $ 1,726 Trading commodity derivative assets — 13 — 13 Total commodity derivative assets $ — $ 1,739 $ — $ 1,739 Non-trading commodity derivative liabilities $ (6) $ (3,385) $ — $ (3,391) Trading commodity derivative liabilities — (3) — (3) Total commodity derivative liabilities $ (6) $ (3,388) $ — $ (3,394) Level 1 Level 2 Level 3 Total December 31, 2020 Non-trading commodity derivative assets $ 104 $ 99 $ — $ 203 Trading commodity derivative assets — 108 — 108 Total commodity derivative assets $ 104 $ 207 $ — $ 311 Non-trading commodity derivative liabilities $ (5) $ (7,655) $ — $ (7,660) Trading commodity derivative liabilities — (72) — (72) Total commodity derivative liabilities $ (5) $ (7,727) $ — $ (7,732) We had no transfers of assets or liabilities between any of the above levels during the three months ended March 31, 2021 and the year ended December 31, 2020. Our derivative contracts include exchange-traded contracts valued utilizing readily available quoted market prices and non-exchange-traded contracts valued using market price quotations available through brokers or over-the-counter and on-line exchanges. In addition, in determining the fair value of our derivative contracts, we apply a credit risk valuation adjustment to reflect credit risk, which is calculated based on our or the counterparty’s historical credit risks. As of March 31, 2021 and December 31, 2020, the credit risk valuation adjustment was a reduction of derivative liabilities, net of $0.2 million and $0.2 million, respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. Income Taxes Income Taxes We and our subsidiaries, CenStar and Verde Energy USA, Inc. ("Verde Corp"), are each subject to U.S. federal income tax as corporations. CenStar and Verde Corp file consolidated tax returns in jurisdictions that allow combined reporting. Spark HoldCo and its subsidiaries, with the exception of CenStar and Verde Corp, are treated as flow-through entities for U.S. federal income tax purposes and, as such, are generally not subject to U.S. federal income tax at the entity level. Rather, the tax liability with respect to their taxable income is passed through to their members or partners. Accordingly, we are subject to U.S. federal income taxation on our allocable share of Spark HoldCo’s net U.S. taxable income. In our financial statements, we report federal and state income taxes for our share of the partnership income attributable to our ownership in Spark HoldCo and for the income taxes attributable to CenStar and Verde Corp. Net income attributable to non-controlling interest includes the provision for income taxes related to CenStar and Verde Corp. We account for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and the tax bases of the assets and liabilities. We apply existing tax law and the tax rate that we expect to apply to taxable income in the years in which those differences are expected to be recovered or settled in calculating the deferred tax assets and liabilities. Effects of changes in tax rates on deferred tax assets and liabilities are recognized in income in the period of the tax rate enactment. A valuation allowance is recorded when it is not more likely than not that some or all of the benefit from the deferred tax asset will be realized. We periodically assess whether it is more likely than not that we will generate sufficient taxable income to realize our deferred income tax assets. In making this determination, we consider all available positive and negative evidence and make certain assumptions. We consider, among other things, our deferred tax liabilities, the overall business environment, our historical earnings and losses, current industry trends, and our outlook for future years. We believe it is more likely than not that our deferred tax assets will be utilized, and accordingly have not recorded a valuation allowance on these assets. As of March 31, 2021, we had a net deferred tax asset of $33.0 million, of which approximately $15.6 million related to the original step up in tax basis resulting from the initial purchase of Spark HoldCo units from NuDevco Retail and NuDevco Retail Holdings (predecessor to Retailco) in connection with our initial public offering. The effective U.S. federal and state income tax rate for the three months ended March 31, 2021 and 2020 was 5.3% and 16.1%, respectively. The effective tax rate for the three and three months ended March 31, 2021 differed from the U.S. federal statutory tax rate of 21% primarily due to state taxes and the benefit provided from Spark HoldCo operating as a limited liability company, which is treated as a partnership for federal and state income tax purposes and is not subject to federal and state income taxes. Accordingly, the portion of earnings attributable to non-controlling interest is subject to tax when reported as a component of the non-controlling interest holders' taxable income. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 12. Commitments and Contingencies From time to time, we may be involved in legal, tax, regulatory and other proceedings in the ordinary course of business. Liabilities for loss contingencies arising from claims, assessments, litigation or other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal Proceedings Below is a summary of our currently pending material legal proceedings. We are subject to lawsuits and claims arising in the ordinary course of our business. The following legal proceedings are in various stages and are subject to substantial uncertainties concerning the outcome of material factual and legal issues. Accordingly, unless otherwise specifically noted, we cannot currently predict the manner and timing of the resolutions of these legal proceedings or estimate a range of possible losses or a minimum loss that could result from an adverse verdict in a potential lawsuit. While the lawsuits and claims are asserted for amounts that may be material should an unfavorable outcome occur, management does not currently expect that any currently pending matters will have a material adverse effect on our financial position or results of operations. Consumer Lawsuits Similar to other energy service companies ( “ ESCOs ” ) operating in the industry, from time-to-time, the Company is subject to class action lawsuits in various jurisdictions where the Company sells natural gas and electricity. Variable Rate Cases In the cases referred to as Variable Rate Cases, such actions involve consumers alleging they paid higher rates than they would have if they stayed with their default utility. The underlying claims of each case are similar; however, because numerous cases have been brought in several different jurisdictions, the varying applicable case law, the varying facts and stages of each case, the Company agreed to mediate in two aggregated mediations to avoid duplicative defense costs in numerous jurisdictions. The Company continues to deny the allegations asserted by Plaintiffs and intends to vigorously defend these matters. In August 2020, the Company participated in mediation which covered three Spark brand matters: ( 1) Janet Rolland et al v. Spark Energy, LLC (D.N.J Apr. 2017); (2) Burger v. Spark Energy Gas, LLC (N.D. Ill. Dec. 2019); and (3) Local 901 v. Spark Energy, LLC (Sup . Ct. Allen County, Indiana Aug. 2019). The Company is working with the mediator to find a resolution to these cases, but is also simultaneously continuing to defend the cases in the respective courts. Given the ongoing mediation, discovery, and current stage of these matters, we cannot predict the outcome of these cases at this time. In December of 2020, the Company participated in mediation which covered several Verde brand matters: ( 1) Marshall. Verde Energy USA, Inc. (D.N.J. Jan. 2018); (2) Mercado v. Verde Energy USA, Inc. (N.D. Ill. Mar. 2018); (3) Davis v. Verde Energy USA, Inc., et al. (D. Mass. Apr. 2019); (4) Panzer v. Verde Energy, USA Inc. and Oasis Power, LLC (E.D. Pa Aug. 2019); (5) LaQua v. Verde Energy USA New York, LLC (E.D.N Y. Jan. 2020); and (6) Abbate v. Verde Energy USA Ohio, LLC (S.D. Ohio Jun. 2020) . The parties continue to work on a mediation resolution and the litigation has been stayed in these matters. Given the ongoing mediation and current stage of these matters, we cannot predict the outcome of these cases at this time. On January 14, 2021, Glikin, et. all v. Major Energy Electric Services, LLC, a purported variable rate class action was filed in the United States District Court, Southern District of New York, attempting to represent a class of all Major Energy customers (including customers of companies Major Energy acts as a successor to) in the United States charged a variable rate for electricity or gas by Major Energy during the applicable statute of limitations period up to and including the date of judgment. The Company believes there is no merit to this case and plans to vigorously defend this matter; however, given the current early stage of this matter, we cannot predict the outcome of this case at this time. Corporate Matter Lawsuits Saul Horowitz, as Sellers’ Representative for the former owners of the Major Energy Companies v. National Gas & Electric, LLC ( “ NG&E ” ) and Spark Energy, Inc., is a lawsuit filed on October 17, 2017 in the United States District Court for the Southern District of New York asserting claims of fraudulent inducement against NG&E, breach of contract against NG&E and Spark, and tortious interference with contract against Spark related to a membership interest purchase agreement, subsequent dropdown, and associated earnout agreements with the Major Energy Companies' former owners. The relief sought includes unspecified compensatory and punitive damages, prejudgment and post-judgment interest, and attorneys' fees. This case went to trial during the first two weeks of March 2020 and all material has been submitted to the Judge for his decision. Given the trial was in Manhattan, New York, which was previously under a shelter-in-place order and is currently re-opening, we are not able to predict when we receive a final decision on this matter. Spark and NG&E deny the allegations asserted by Plaintiffs and have vigorously defended this matter; however, we cannot predict the outcome or consequences of this case at this time. In addition, several smaller, related cases involving the same facts are pending in the United States District Court for the Southern District of New York regarding the Major Energy escrowed indemnification monies and three Major Energy executive compensation agreements. As to the indemnification matter, the parties have reached an agreement to release certain original escrowed monies by the Sellers of Major Energy to the Company, which would conclude that current case in favor of the Company. In addition to the matters disclosed above, the Company may from time to time be subject to legal proceedings that arise in the ordinary course of business. Although there can be no assurance in this regard, the Company does not expect any of those legal proceedings to have a material adverse effect on the Company’s results of operations, cash flows or financial condition. Regulatory Matters Many state regulators have increased scrutiny on retail energy providers, across all industry providers. We are subject to regular regulatory inquiries, license renewal reviews, and preliminary investigations in the ordinary course of our business. Below is a summary of our currently pending material state regulatory matters. The following state regulatory matters are in various stages and are subject to substantial uncertainties concerning the outcome of material factual and legal issues. Accordingly, we cannot currently predict the manner and timing of the resolution of these state regulatory matters or estimate a range of possible losses or a minimum loss that could result from an adverse action. Management does not currently expect that any currently pending state regulatory matters will have a material adverse effect on our financial position or results of operations. Connecticut. In 2019, PURA initiated review of two of the Company's brands in Connecticut, Spark and Verde, focusing on marketing, billing and enrollment practices. The Company has and is cooperating with PURA's requests to review Spark and Verde practices in Connecticut. Illinois . Spark Energy, LLC received a verbal inquiry from the Illinois Commerce Commission ( “ ICC ” ) and the Illinois Attorney General ("IAG") on January 1, 2020 seeking to understand an increase in complaints from Illinois consumers. The Company met with the ICC and the IAG in February 2020 and plan to discuss a compliance plan to ensure its sales are in compliance with Illinois regulations. The parties also discussed possible restitution payments to any customers impacted by sales not in compliance with Illinois regulations. New York. Prior to the purchase of Major Energy by the Company, in 2015, Major Energy Services, LLC and Major Energy Electric Services were contacted by the Attorney General, Bureau of Consumer Frauds & Protection for State of New York relating to their marketing practices. Major Energy has exchanged information in response to various requests from the Attorney General and recently agreed to respond to additional questions via remote proceedings in October of 2020. The parties are in settlement negotiations at this time. While investigations of this nature may be resolved in a manner that allows the retail energy supplier to continue operating in New York with stipulations, there can be no assurances that the New York Attorney General will not take more severe action. Prior to the purchase of Major Energy by the Company, in 2015, Major Energy Services, LLC and Major Energy Electric Services were contacted by the Attorney General, Bureau of Consumer Frauds & Protection for State of New York relating to their marketing practices. Major Energy has exchanged information in response to various requests from the Attorney General. The Parties are in settlement negotiations at this time. While investigations of this nature may be resolved in a manner that allows the retail energy supplier to continue operating in New York with stipulations, there can be no assurances that the New York Attorney General will not take more severe action. Pennsylvania. Verde Energy USA, Inc. (“Verde”) is the subject of a formal investigation by the Pennsylvania Public Utility Commission, Bureau of Investigation and Enforcement (“PPUC”) initiated on January 30, 2020. The investigation asserts that Verde may have violated Pennsylvania retail energy supplier regulations. The Company met with the PPUC in February 2020 to discuss the matter and to work with the PPUC cooperatively. Verde reached a settlement, which includes a civil penalty of $1.0 million and a $0.1 million contribution to the PPL hardship fund. On June 30, 2020, Verde and PPUC Bureau of Investigation and Enforcement filed a Joint Petition for Approval of Settlement and Statements in Support of that Joint Petition with the Commission. Verde is currently awaiting final approval of this settlement. In addition to the matters disclosed above, in the ordinary course of business, the Company may from time to time be subject to regulators initiating informal reviews or issuing subpoenas for information as means to evaluate the Company and its subsidiaries’ compliance with applicable laws, rule, regulations and practices. Although there can be no assurance in this regard, the Company does not expect any of those regulatory reviews to have a material adverse effect on the Company’s results of operations, cash flows or financial condition. Indirect Tax Audits We are undergoing various types of indirect tax audits spanning from years 2014 to 2020 for which additional liabilities may arise. At the time of filing these consolidated financial statements, these indirect tax audits are at an early stage and subject to substantial uncertainties concerning the outcome of audit findings and corresponding responses. As of March 31, 2021 and December 31, 2020, we had accrued $22.9 million and $26.6 million, respectively, related to litigation and regulatory matters and $1.1 million and $1.2 million, respectively, related to indirect tax audits. The outcome of each of these may result in additional expense. |
Transactions with Affiliates
Transactions with Affiliates | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Transactions with Affiliates | 13. Transactions with Affiliates Transactions with Affiliates We enter into transactions with and pay certain costs on behalf of affiliates that are commonly controlled in order to reduce risk, reduce administrative expense, create economies of scale, create strategic alliances and supply goods and services to these related parties. We also sell and purchase natural gas and electricity with affiliates and pay an affiliate to perform telemarketing activities. We present receivables and payables with the same affiliate on a net basis in the condensed consolidated balance sheets as all affiliate activity is with parties under common control. Affiliated transactions include certain services to the affiliated companies associated with employee benefits provided through our benefit plans, insurance plans, leased office space, administrative salaries, due diligence work, recurring management consulting, and accounting, tax, legal, or technology services. Amounts billed are based on the services provided, departmental usage, or headcount, which are considered reasonable by management. As such, the accompanying condensed consolidated financial statements include costs that have been incurred by us and then directly billed or allocated to affiliates, as well as costs that have been incurred by our affiliates and then directly billed or allocated to us, and are recorded net in general and administrative expense on the condensed consolidated statements of operations with a corresponding accounts receivable—affiliates or accounts payable—affiliates, respectively, recorded in the condensed consolidated balance sheets. Transactions with affiliates for sales or purchases of natural gas and electricity are recorded in retail revenues, retail cost of revenues, and net asset optimization revenues in the condensed consolidated statements of operations with a corresponding accounts receivable—affiliate or accounts payable—affiliate are recorded in the condensed consolidated balance sheets. Cost Allocations Where costs incurred on behalf of the affiliate or us cannot be determined by specific identification for direct billing, the costs are allocated to the affiliated entities or us based on estimates of percentage of departmental usage, wages or headcount. The total net amount direct billed and allocated (to)/from affiliates was $(0.8) million and $(0.2) million for the three months ended March 31, 2021 and 2020, respectively. General and administrative costs of $0.1 million and zero were recorded for the three months ended March 31, 2021, and 2020 related to telemarketing activities performed by an affiliate. Accounts Receivable and Payable — Affiliates As of March 31, 2021 and December 31, 2020, we had current accounts receivable—affiliates of $5.3 million and $5.1 million, respectively, and current accounts payable—affiliates of $1.3 million and $0.8 million, respectively. Revenues and Cost of Revenues — Affiliates Revenues recorded in net asset optimization revenue in the condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020 related to affiliated sales were $0.3 million and $0.5 million, respectively. Cost of revenues recorded in net asset optimization revenues in the condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020 related to affiliated purchases were less than $0.1 million and $0.2 million, respectively. These amounts are presented as net on the condensed consolidated statements of operations. Distributions to and Contributions from Affiliates During three months ended March 31, 2021 and 2020, Spark HoldCo made distributions to affiliates of our Founder of $3.8 million and $3.8 million, respectively, for the payments of quarterly distribution on their respective Spark HoldCo units. During the three months ended March 31, 2021 and 2020, Spark HoldCo also made distributions to these affiliates for gross-up distributions of $2.7 million and $3.4 million, respectively, in connection with distributions made between Spark HoldCo and Spark Energy, Inc. for payment of income taxes incurred by us. Subordinated Debt Facility In June 2019, we and Spark HoldCo entered into a Subordinated Debt Facility with an affiliate owned by our Founder, which allows the Company to borrow up to $25.0 million. The Subordinated Debt Facility allows us to draw advances in increments of no less than $1.0 million per advance up to the maximum principal amount of the Subordinated Debt Facility. Advances thereunder accrue interest at 5% per annum from the date of the advance. As of March 31, 2021 and December 31, 2020, there was $10.0 million and zero in outstanding borrowings under the Subordinated Debt Facility. See Note 9 "Debt" for a further description of terms and conditions of the Subordinated Debt Facility. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Reporting | 14. Segment Reporting Our determination of reportable business segments considers the strategic operating units under which we make financial decisions, allocate resources and assess performance of our business. Our reportable business segments are retail electricity and retail natural gas. The retail electricity segment consists of electricity sales and transmission to residential and commercial customers. The retail natural gas segment consists of natural gas sales to, and natural gas transportation and distribution for, residential and commercial customers. Corporate and other consists of expenses and assets of the retail electricity and natural gas segments that are managed at a consolidated level such as general and administrative expenses. Asset optimization activities are also included in Corporate and other. For the three months ended March 31, 2021 and 2020, we recorded asset optimization revenues of $25.7 million and $6.4 million and asset optimization cost of revenues of $25.8 million and $6.1 million, respectively, which are presented on a net basis in asset optimization revenues. We use retail gross margin to assess the performance of our operating segments. We have historically defined retail gross margin as operating (loss) income plus (i) depreciation and amortization expenses and (ii) general and administrative expenses, less (i) net asset optimization (expenses) revenues, (ii) net (losses) gains on non-trading derivative instruments, and (iii) net current period cash settlements on non-trading derivative instruments. Based on the events described below related to Winter Storm Uri, and to ensure Retail Gross Margin reflects repeatable operating performance that is not distorted by non-recurring events or extreme market volatility, we have revised the definition of Retail Gross Margin in this Report to include gains (losses) from non-recurring events (including non-recurring market volatility). We deduct net (losses) gains on non-trading derivative instruments, excluding current period cash settlements, from the retail gross margin calculation in order to remove the non-cash impact of net gains and losses on these derivative instruments. Retail gross margin should not be considered an alternative to, or more meaningful than, operating income, as determined in accordance with GAAP. Below is a reconciliation of retail gross margin to income before income tax expense (in thousands): Three Months Ended March 31, 2021 2020 Reconciliation of Retail Gross Margin to (loss) income before taxes (Loss) income before income tax (benefit) expense $ (29,095) $ 11,993 Interest and other income (86) (160) Interest expense 1,311 1,553 Operating (loss) income (27,870) 13,386 Depreciation and amortization 6,036 8,796 General and administrative 12,671 25,676 Less: Net asset optimization (expense) revenue (140) 321 Net, gain (loss) on non-trading derivative instruments 7,054 (24,533) Net, Cash settlements on non-trading derivative instruments (1,189) 16,609 Non-recurring event - Winter Storm Uri (64,900) — Retail Gross Margin $ 50,012 $ 55,461 Financial data for business segments are as follows (in thousands): Three Months Ended March 31, 2021 Retail Retail Corporate Eliminations Consolidated Total Revenues $ 78,755 $ 34,390 $ (140) $ — $ 113,005 Retail cost of revenues 107,524 14,644 — — 122,168 Less: Net asset optimization expense — — (140) — (140) Net, gain on non-trading derivative instruments 6,705 349 — — 7,054 Current period settlements on non-trading derivatives (1,188) (1) — — (1,189) Non-recurring event - Winter Storm Uri (64,900) — — — (64,900) Retail Gross Margin $ 30,614 $ 19,398 $ — $ — $ 50,012 Total Assets at March 31, 2021 $ 2,961,333 $ 970,315 $ 330,327 $ (3,897,648) $ 364,327 Goodwill at March 31, 2021 $ 117,813 $ 2,530 $ — $ — $ 120,343 Three Months Ended March 31, 2020 Retail Retail Corporate Eliminations Consolidated Total revenues $ 121,768 $ 44,592 $ 321 $ — $ 166,681 Retail cost of revenues 100,383 18,440 — — 118,823 Less: Net asset optimization revenue — — 321 — 321 Net, loss on non-trading derivative instruments (24,386) (147) — — (24,533) Current period settlements on non-trading derivatives 14,965 1,644 — — 16,609 Retail Gross Margin $ 30,806 $ 24,655 $ — $ — $ 55,461 Total Assets at December 31, 2020 $ 2,906,139 $ 941,569 $ 318,865 $ (3,799,906) $ 366,667 Goodwill at December 31, 2020 $ 117,813 $ 2,530 $ — $ — $ 120,343 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | 15. Subsequent Events Declaration of Dividends On April 21, 2021, we declared a quarterly dividend of $0.18125 per share to holders of record of our Class A common stock on June 1, 2021, which will be paid on June 15, 2021. On April 21, 2021, we also declared a quarterly cash dividend in the amount of $0.546875 per share to holders of record of the Series A Preferred Stock on July 1, 2021. The dividend will be paid on July 15, 2021. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC") as it applies to interim financial statements. This information should be read along with our consolidated financial statements and notes contained in our annual report on Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”). Our unaudited condensed consolidated financial statements are presented on a consolidated basis and include all wholly-owned and controlled subsidiaries. We account for investments over which we have significant influence but not a controlling financial interest using the equity method of accounting. All significant intercompany transactions and balances have been eliminated in the unaudited condensed consolidated financial statements. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of our condensed consolidated financial statements requires estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim financial statements and the reported amounts of revenues and expenses during the period. Actual results could materially differ from those estimates. |
New Accounting Standards Recently Adopted and Standards Being Evaluated/Standards Not Yet Adopted | New Accounting Standards Recently Adopted There have been no changes to our significant accounting policies as disclosed in our 2020 Form 10-K, except as follows: In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes ("ASU 2019-12"). These amendments simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. For public business entities, the amendments in ASU 2019-12 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. We adopted ASU 2019-12 effective January 1, 2021 and the adoption did not have a material impact on our consolidated financial statements. Standards Being Evaluated/Standards Not Yet Adopted Below are accounting standards that have been issued by the FASB but have not yet been adopted by the Company at March 31, 2021. The Company considers the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting ("ASU 2020-04"). The amendments in ASU 2020-04 provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform ("ASU 2021-01"), which clarifies the scope and application of certain optional expedients and exceptions regarding the original guidance. The amendments in these ASUs were effective upon issuance and can be applied prospectively through December 31, 2022. The Company's Senior Credit Facility is the only agreement that makes reference to a LIBOR rate and the agreement outlines the specific procedures that will be undertaken once an appropriate alternative benchmark is identified.We do not expect adoption of the new standard to have a material impact to our consolidated financial statements. |
Derivative Instruments | Derivative assets and liabilities are presented net in our condensed consolidated balance sheets when the derivative instruments are executed with the same counterparty under a master netting arrangement. Our derivative contracts include transactions that are executed both on an exchange and centrally cleared, as well as over-the-counter, bilateral contracts that are transacted directly with third parties. To the extent we have paid or received collateral related to the derivative assets or liabilities, such amounts would be presented net against the related derivative asset or liability’s fair value. |
Fair Value Measurements | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (exit price) in an orderly transaction between market participants at the measurement date. Fair values are based on assumptions that market participants would use when pricing an asset or liability, including assumptions about risk and the risks inherent in valuation techniques and the inputs to valuations. This includes the credit standing of counterparties involved and the impact of credit enhancements. We apply fair value measurements to our commodity derivative instruments based on the following fair value hierarchy, which prioritizes the inputs to the valuation techniques used to measure fair value into three broad levels: • Level 1—Quoted prices in active markets for identical assets and liabilities. Instruments categorized in Level 1 primarily consist of financial instruments such as exchange-traded derivative instruments. • Level 2—Inputs other than quoted prices recorded in Level 1 that are either directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived from observable market data by correlation or other means. Instruments categorized in Level 2 primarily include non-exchange traded derivatives such as over-the-counter commodity forwards and swaps and options. • Level 3—Unobservable inputs for the asset or liability, including situations where there is little, if any, observable market activity for the asset or liability. As the fair value hierarchy gives the highest priority to quoted prices in active markets (Level 1) and the lowest priority to unobservable data (Level 3), the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. These levels can change over time. In some cases, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. In these cases, the lowest level input that is significant to a fair value measurement in its entirety determines the applicable level in the fair value hierarchy. |
Revenues (Tables)
Revenues (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregated Revenue | The following table discloses revenue by primary geographical market, customer type, and customer credit risk profile (in thousands). The table also includes a reconciliation of the disaggregated revenue to revenue by reportable segment (in thousands). Reportable Segments Three Months Ended March 31, 2021 Three Months Ended March 31, 2020 Retail Electricity Retail Natural Gas Total Reportable Segments Retail Electricity Retail Natural Gas Total Reportable Segments Primary markets (a) New England $ 26,241 $ 4,377 $ 30,618 $ 46,593 $ 7,054 $ 53,647 Mid-Atlantic 28,550 13,455 42,005 45,842 15,804 61,646 Midwest 11,059 10,238 21,297 14,989 13,607 28,596 Southwest 12,905 6,320 19,225 14,344 8,127 22,471 $ 78,755 $ 34,390 $ 113,145 $ 121,768 $ 44,592 $ 166,360 Customer type Commercial $ 15,216 $ 11,516 $ 26,732 $ 40,015 $ 15,517 $ 55,532 Residential 73,272 26,490 99,762 93,228 33,363 126,591 Unbilled revenue (b) (9,733) (3,616) (13,349) (11,475) (4,288) (15,763) $ 78,755 $ 34,390 $ 113,145 $ 121,768 $ 44,592 $ 166,360 Customer credit risk POR $ 50,850 $ 19,600 $ 70,450 $ 84,913 $ 23,037 $ 107,950 Non-POR 27,905 14,790 42,695 36,855 21,555 58,410 $ 78,755 $ 34,390 $ 113,145 $ 121,768 $ 44,592 $ 166,360 (a) The primary markets include the following states: • New England - Connecticut, Maine, Massachusetts, New Hampshire; • Mid-Atlantic - Delaware, Maryland (including the District of Colombia), New Jersey, New York and Pennsylvania; • Midwest - Illinois, Indiana, Michigan and Ohio; and • Southwest - Arizona, California, Colorado, Florida, Nevada, and Texas. (b) Unbilled revenue is recorded in total until it is actualized, at which time it is categorized between commercial and residential customers. |
Accounts Receivable, Allowance for Credit Loss | A rollforward of our allowance for credit losses for the three months ended March 31, 2021 are presented in the table below (in thousands): Balance at December 31, 2020 $ (3,942) Current period bad debt provision 490 Write-offs 934 Recovery of previous write offs (180) Balance at March 31, 2021 $ (2,698) |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Schedule of Economic Interests | The Company and affiliates owned the following economic interests in Spark HoldCo at March 31, 2021 and December 31, 2020, respectively. The Company Affiliated Owners March 31, 2021 41.53 % 58.47 % December 31, 2020 41.53 % 58.47 % |
Summary of Net Income (Loss) and Income Tax Expense (Benefit) Attributable to Non-controlling Interest | The following table summarizes the portion of net (loss) income and income tax expense (benefit) attributable to non-controlling interest (in thousands): Three Months Ended March 31, 2021 2020 Net (loss) income allocated to non-controlling interest $ (18,321) $ 6,085 Income tax expense allocated to non-controlling interest 1,608 496 Net (loss) income attributable to non-controlling interest $ (19,929) $ 5,589 |
Computation of Basic and Diluted Income (Loss) Per Share | The following table presents the computation of basic and diluted income (loss) per share for the three months ended March 31, 2021 and 2020 (in thousands, except per share data): Three Months Ended March 31, 2021 2020 Net (loss) income attributable to Spark Energy, Inc. stockholders $ (7,631) $ 4,479 Less: Dividends on Series A preferred stock 1,951 1,500 Net (loss) income attributable to stockholders of Class A common stock $ (9,582) $ 2,979 Basic weighted average Class A common shares outstanding 14,627 14,381 Basic (loss) income per share attributable to stockholders $ (0.66) $ 0.21 Net (loss) income attributable to stockholders of Class A common stock $ (9,582) $ 2,979 Effect of conversion of Class B common stock to shares of Class A common stock — — Diluted net (loss) income attributable to stockholders of Class A common stock $ (9,582) $ 2,979 Basic weighted average Class A common shares outstanding 14,627 14,381 Effect of dilutive Class B common stock — — Effect of dilutive restricted stock units — 403 Diluted weighted average shares outstanding 14,627 14,784 Diluted (loss) income per share attributable to stockholders $ (0.66) $ 0.20 |
Carrying Amounts and Classification of Assets and Liabilities | The following table includes the carrying amounts and classification of the assets and liabilities of Spark HoldCo that are included in our condensed consolidated balance sheet as of March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 December 31, 2020 Assets Current assets: Cash and cash equivalents $ 81,290 $ 71,442 Accounts receivable 55,671 70,350 Other current assets 56,390 55,575 Total current assets 193,351 197,367 Non-current assets: Goodwill 120,343 120,343 Other assets 13,182 15,259 Total non-current assets 133,525 135,602 Total Assets $ 326,876 $ 332,969 Liabilities Current liabilities: Accounts payable and accrued liabilities $ 54,883 $ 61,436 Other current liabilities 44,228 43,676 Total current liabilities 99,111 105,112 Long-term liabilities: Long-term portion of Senior Credit Facility 135,000 100,000 Subordinated debt — affiliate 10,000 — Other long-term liabilities 183 256 Total long-term liabilities 145,183 100,256 Total Liabilities $ 244,294 $ 205,368 |
Preferred Stock (Tables)
Preferred Stock (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Summary of Preferred Equity Balance | A summary of our preferred equity balance for the three months ended March 31, 2021 is as follows: (in thousands) Balance at December 31, 2020 $ 87,288 Repurchase of Series A Preferred Stock — Accumulated dividends on Series A Preferred Stock — Balance at March 31, 2021 $ 87,288 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Volumetric Underlying Derivative Transactions | The following table summarizes the net notional volumes of our open derivative financial instruments accounted for at fair value by commodity. Positive amounts represent net buys while bracketed amounts are net sell transactions (in thousands): Non-trading Commodity Notional March 31, 2021 December 31, 2020 Natural Gas MMBtu 2,183 2,880 Electricity MWh 1,843 1,845 Trading Commodity Notional March 31, 2021 December 31, 2020 Natural Gas MMBtu 105 102 |
Gains (Losses) on Derivative Instruments | Gains (losses) on derivative instruments, net and current period settlements on derivative instruments were as follows for the periods indicated (in thousands): Three Months Ended March 31, 2021 2020 Gain (Loss) on non-trading derivatives, net $ 7,054 $ (24,533) Loss on trading derivatives, net (30) (54) Gain (Loss) on derivatives, net 7,024 (24,587) Current period settlements on non-trading derivatives (1) $ (1,189) $ 16,609 Current period settlements on trading derivatives 4 (1) Total current period settlements on derivatives $ (1,185) $ 16,608 ( 1) Excludes settlements of $(0.3) million, for the three months ended March 31, 2020 related to power call options. |
Offsetting Assets | The following tables summarize the fair value and offsetting amounts of our derivative instruments by counterparty and collateral received or paid (in thousands): March 31, 2021 Description Gross Assets Gross Net Assets Cash Net Amount Non-trading commodity derivatives $ 3,759 $ (2,094) $ 1,665 $ — $ 1,665 Trading commodity derivatives 14 (1) 13 — 13 Total Current Derivative Assets 3,773 (2,095) 1,678 — 1,678 Non-trading commodity derivatives 233 (172) 61 — 61 Trading commodity derivatives — — — — — Total Non-current Derivative Assets 233 (172) 61 — 61 Total Derivative Assets $ 4,006 $ (2,267) $ 1,739 $ — $ 1,739 December 31, 2020 Description Gross Assets Gross Net Assets Cash Net Amount Non-trading commodity derivatives $ 308 $ (105) $ 203 $ — $ 203 Trading commodity derivatives 112 (4) 108 — 108 Total Current Derivative Assets 420 (109) 311 — 311 Non-trading commodity derivatives — — — — — Trading commodity derivatives — — — — — Total Non-current Derivative Assets — — — — — Total Derivative Assets $ 420 $ (109) $ 311 $ — $ 311 |
Offsetting Liabilities | Description Gross Gross Net Cash Net Amount Non-trading commodity derivatives $ (6,623) $ 3,394 $ (3,229) $ 13 $ (3,216) Trading commodity derivatives (3) — (3) — (3) Total Current Derivative Liabilities (6,626) 3,394 (3,232) 13 (3,219) Non-trading commodity derivatives (490) 315 (175) — (175) Trading commodity derivatives — — — — — Total Non-current Derivative Liabilities (490) 315 (175) — (175) Total Derivative Liabilities $ (7,116) $ 3,709 $ (3,407) $ 13 $ (3,394) Description Gross Gross Net Cash Net Amount Non-trading commodity derivatives $ (11,139) $ 3,620 $ (7,519) $ 86 $ (7,433) Trading commodity derivatives (74) 2 (72) — (72) Total Current Derivative Liabilities (11,213) 3,622 (7,591) 86 (7,505) Non-trading commodity derivatives (838) 611 (227) — (227) Trading commodity derivatives — — — — — Total Non-current Derivative Liabilities (838) 611 (227) — (227) Total Derivative Liabilities $ (12,051) $ 4,233 $ (7,818) $ 86 $ (7,732) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consist of the following (in thousands): Estimated useful March 31, 2021 December 31, 2020 Information technology 2 – 5 $ 5,307 $ 5,821 Furniture and fixtures 2 – 5 957 957 Total 6,264 6,778 Accumulated depreciation (2,808) (3,424) Property and equipment—net $ 3,456 $ 3,354 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill, Customer Relationships and Trademarks | Goodwill, customer relationships and trademarks consist of the following amounts (in thousands): March 31, 2021 December 31, 2020 Goodwill $ 120,343 $ 120,343 Customer relationships—Acquired Cost $ 58,688 $ 58,688 Accumulated amortization (46,445) (44,175) Customer relationships — Acquired $ 12,243 $ 14,513 Customer relationships—Other Cost $ 8,898 $ 8,988 Accumulated amortization (6,415) (5,733) Customer relationships — Other, net $ 2,483 $ 3,255 Trademarks Cost $ 7,570 $ 7,570 Accumulated amortization (3,249) (2,972) Trademarks, net $ 4,321 $ 4,598 Changes in goodwill, customer relationships (including non-compete agreements) and trademarks consisted of the following (in thousands): Goodwill Customer Relationships — Acquired Customer Relationships — Other Trademarks Balance at December 31, 2020 $ 120,343 $ 14,513 $ 3,255 $ 4,598 Adjustments — — (28) — Amortization — (2,270) (744) (277) Balance at March 31, 2021 $ 120,343 $ 12,243 $ 2,483 $ 4,321 |
Estimated Future Amortization Expense | Estimated future amortization expense for customer relationships and trademarks at March 31, 2021 is as follows (in thousands): Year ending December 31, 2021 (remaining nine months) $ 9,823 2022 6,194 2023 605 2024 404 2025 404 > 5 years 1,617 Total $ 19,047 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt consists of the following amounts as of March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 December 31, 2020 Long-term debt: Senior Credit Facility (1) (2) $ 135,000 $ 100,000 Subordinated Debt 10,000 — Total long-term debt 145,000 100,000 Total debt $ 145,000 $ 100,000 (1) As of March 31, 2021 and December 31, 2020, the weighted average interest rate on the Senior Credit Facility was 3.75% and 3.75%, respectively. (2) As of March 31, 2021 and December 31, 2020, we had $29.7 million and $31.0 million in letters of credit issued, respectively. |
Components of Interest Expense | Interest expense consists of the following components for the periods indicated (in thousands): Three Months Ended March 31, 2021 2020 Senior Credit Facility $ 468 $ 911 Letters of credit fees and commitment fees 402 392 Amortization of deferred financing costs 259 250 Other 182 — Interest Expense $ 1,311 $ 1,553 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables present assets and liabilities measured and recorded at fair value in our condensed consolidated balance sheets on a recurring basis by and their level within the fair value hierarchy (in thousands): Level 1 Level 2 Level 3 Total March 31, 2021 Non-trading commodity derivative assets $ — $ 1,726 $ — $ 1,726 Trading commodity derivative assets — 13 — 13 Total commodity derivative assets $ — $ 1,739 $ — $ 1,739 Non-trading commodity derivative liabilities $ (6) $ (3,385) $ — $ (3,391) Trading commodity derivative liabilities — (3) — (3) Total commodity derivative liabilities $ (6) $ (3,388) $ — $ (3,394) Level 1 Level 2 Level 3 Total December 31, 2020 Non-trading commodity derivative assets $ 104 $ 99 $ — $ 203 Trading commodity derivative assets — 108 — 108 Total commodity derivative assets $ 104 $ 207 $ — $ 311 Non-trading commodity derivative liabilities $ (5) $ (7,655) $ — $ (7,660) Trading commodity derivative liabilities — (72) — (72) Total commodity derivative liabilities $ (5) $ (7,727) $ — $ (7,732) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Reconciliation of Retail Gross Margin to Income Before Income Tax Expense | Below is a reconciliation of retail gross margin to income before income tax expense (in thousands): Three Months Ended March 31, 2021 2020 Reconciliation of Retail Gross Margin to (loss) income before taxes (Loss) income before income tax (benefit) expense $ (29,095) $ 11,993 Interest and other income (86) (160) Interest expense 1,311 1,553 Operating (loss) income (27,870) 13,386 Depreciation and amortization 6,036 8,796 General and administrative 12,671 25,676 Less: Net asset optimization (expense) revenue (140) 321 Net, gain (loss) on non-trading derivative instruments 7,054 (24,533) Net, Cash settlements on non-trading derivative instruments (1,189) 16,609 Non-recurring event - Winter Storm Uri (64,900) — Retail Gross Margin $ 50,012 $ 55,461 |
Financial Data for Business Segments | Financial data for business segments are as follows (in thousands): Three Months Ended March 31, 2021 Retail Retail Corporate Eliminations Consolidated Total Revenues $ 78,755 $ 34,390 $ (140) $ — $ 113,005 Retail cost of revenues 107,524 14,644 — — 122,168 Less: Net asset optimization expense — — (140) — (140) Net, gain on non-trading derivative instruments 6,705 349 — — 7,054 Current period settlements on non-trading derivatives (1,188) (1) — — (1,189) Non-recurring event - Winter Storm Uri (64,900) — — — (64,900) Retail Gross Margin $ 30,614 $ 19,398 $ — $ — $ 50,012 Total Assets at March 31, 2021 $ 2,961,333 $ 970,315 $ 330,327 $ (3,897,648) $ 364,327 Goodwill at March 31, 2021 $ 117,813 $ 2,530 $ — $ — $ 120,343 Three Months Ended March 31, 2020 Retail Retail Corporate Eliminations Consolidated Total revenues $ 121,768 $ 44,592 $ 321 $ — $ 166,681 Retail cost of revenues 100,383 18,440 — — 118,823 Less: Net asset optimization revenue — — 321 — 321 Net, loss on non-trading derivative instruments (24,386) (147) — — (24,533) Current period settlements on non-trading derivatives 14,965 1,644 — — 16,609 Retail Gross Margin $ 30,806 $ 24,655 $ — $ — $ 55,461 Total Assets at December 31, 2020 $ 2,906,139 $ 941,569 $ 318,865 $ (3,799,906) $ 366,667 Goodwill at December 31, 2020 $ 117,813 $ 2,530 $ — $ — $ 120,343 |
Revenues - Narrative (Details)
Revenues - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Typical length of contract | Electricity and natural gas products may be sold as fixed-price or variable-price products. The typical length of a contract to provide electricity and/or natural gas is twelve months. | |
Retail Revenues | ||
Disaggregation of Revenue [Line Items] | ||
Gross receipts taxes | $ 0.3 | $ 0.3 |
Retail Cost of Revenues | ||
Disaggregation of Revenue [Line Items] | ||
Gross receipts taxes | $ 1.2 | $ 1.7 |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Retail revenues | $ 113,145 | $ 166,360 |
POR | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 70,450 | 107,950 |
Non-POR | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 42,695 | 58,410 |
Unbilled revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | (13,349) | (15,763) |
Commercial | Billed revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 26,732 | 55,532 |
Residential | Billed revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 99,762 | 126,591 |
New England | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 30,618 | 53,647 |
Mid-Atlantic | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 42,005 | 61,646 |
Midwest | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 21,297 | 28,596 |
Southwest | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 19,225 | 22,471 |
Retail Electricity | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 78,755 | 121,768 |
Retail Electricity | POR | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 50,850 | 84,913 |
Retail Electricity | Non-POR | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 27,905 | 36,855 |
Retail Electricity | Unbilled revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | (9,733) | (11,475) |
Retail Electricity | Commercial | Billed revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 15,216 | 40,015 |
Retail Electricity | Residential | Billed revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 73,272 | 93,228 |
Retail Electricity | New England | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 26,241 | 46,593 |
Retail Electricity | Mid-Atlantic | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 28,550 | 45,842 |
Retail Electricity | Midwest | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 11,059 | 14,989 |
Retail Electricity | Southwest | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 12,905 | 14,344 |
Retail Natural Gas | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 34,390 | 44,592 |
Retail Natural Gas | POR | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 19,600 | 23,037 |
Retail Natural Gas | Non-POR | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 14,790 | 21,555 |
Retail Natural Gas | Unbilled revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | (3,616) | (4,288) |
Retail Natural Gas | Commercial | Billed revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 11,516 | 15,517 |
Retail Natural Gas | Residential | Billed revenue | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 26,490 | 33,363 |
Retail Natural Gas | New England | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 4,377 | 7,054 |
Retail Natural Gas | Mid-Atlantic | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 13,455 | 15,804 |
Retail Natural Gas | Midwest | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | 10,238 | 13,607 |
Retail Natural Gas | Southwest | ||
Disaggregation of Revenue [Line Items] | ||
Retail revenues | $ 6,320 | $ 8,127 |
Revenues - A Rollforward of Our
Revenues - A Rollforward of Our Allowance for Credit Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Bad debt expense | $ (247) | $ 2,355 |
Trade Accounts Receivable | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | (3,942) | |
Bad debt expense | 490 | |
Write-offs | 934 | |
Recovery of previous write offs | (180) | |
Ending balance | $ (2,698) |
Equity - Schedule of Economic I
Equity - Schedule of Economic Interests (Details) - The Company | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Class of Stock [Line Items] | ||
Economic interest | 41.53% | 41.53% |
Affiliated Owners | ||
Class of Stock [Line Items] | ||
Economic interest | 58.47% | 58.47% |
Equity - Non-controlling Intere
Equity - Non-controlling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Equity [Abstract] | ||
Net (loss) income allocated to non-controlling interest | $ (18,321) | $ 6,085 |
Income tax expense allocated to non-controlling interest | 1,608 | 496 |
Less: Net income attributable to non-controlling interests | $ (19,929) | $ 5,589 |
Equity - Narrative (Details)
Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Aug. 18, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Payment of dividends to Class A common stockholders | $ 2,651 | $ 2,606 | |
NuDevco retail holdings and NuDevco retail | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Distributions to affiliates | $ 3,800 | $ 3,800 | |
Common Class A | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Dividends paid (in dollars per share) | $ 0.18125 | $ 0.18125 | |
Share repurchase program, amount authorized | $ 20,000 | ||
Common Class B | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Shares excluded from computation of diluted earnings per share (in shares) | 20.8 | 20.8 |
Equity - Basic and Diluted Inco
Equity - Basic and Diluted Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Equity [Abstract] | ||
Net (loss) income attributable to Spark Energy, Inc. stockholders | $ (7,631) | $ 4,479 |
Less: Dividends on Series A preferred stock | 1,951 | 1,500 |
Net (loss) income attributable to stockholders of Class A common stock | $ (9,582) | $ 2,979 |
Basic weighted average Class A common shares outstanding (in shares) | 14,627 | 14,381 |
Basic income (loss) per share attributable to stockholders (in dollars per share) | $ (0.66) | $ 0.21 |
Net (loss) income attributable to stockholders of Class A common stock | $ (9,582) | $ 2,979 |
Effect of conversion of Class B common stock to shares of Class A common stock | 0 | 0 |
Diluted net (loss) income attributable to stockholders of Class A common stock | $ (9,582) | $ 2,979 |
Basic weighted average Class A common shares outstanding (in shares) | 14,627 | 14,381 |
Effect of dilutive Class B common stock (in shares) | 0 | 0 |
Effect of dilutive restricted stock units (in shares) | 0 | 403 |
Diluted weighted average shares outstanding (in shares) | 14,627 | 14,784 |
Diluted (loss) income per share attributable to stockholders (in dollars per share) | $ (0.66) | $ 0.20 |
Equity - VIEs (Details)
Equity - VIEs (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 81,491 | $ 71,684 |
Accounts receivable | 55,671 | 70,350 |
Other current assets | 12,089 | 11,818 |
Total current assets | 200,401 | 204,874 |
Goodwill | 120,343 | 120,343 |
Other assets | 3,634 | 4,139 |
Total assets | 364,327 | 366,667 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 25,243 | 27,322 |
Other current liabilities | 1,265 | 1,295 |
Total current liabilities | 81,620 | 90,661 |
Long-term liabilities: | ||
Long-term portion of Senior Credit Facility | 135,000 | 100,000 |
Subordinated debt—affiliate | 10,000 | 0 |
Other long-term liabilities | 7 | 30 |
Total liabilities | 226,802 | 190,918 |
Variable Interest Entity, Primary Beneficiary | ||
Current assets: | ||
Cash and cash equivalents | 81,290 | 71,442 |
Accounts receivable | 55,671 | 70,350 |
Other current assets | 56,390 | 55,575 |
Total current assets | 193,351 | 197,367 |
Goodwill | 120,343 | 120,343 |
Other assets | 13,182 | 15,259 |
Total non-current assets | 133,525 | 135,602 |
Total assets | 326,876 | 332,969 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 54,883 | 61,436 |
Other current liabilities | 44,228 | 43,676 |
Total current liabilities | 99,111 | 105,112 |
Long-term liabilities: | ||
Long-term portion of Senior Credit Facility | 135,000 | 100,000 |
Subordinated debt—affiliate | 10,000 | 0 |
Other long-term liabilities | 183 | 256 |
Total long-term liabilities | 145,183 | 100,256 |
Total liabilities | $ 244,294 | $ 205,368 |
Preferred Stock - Narrative (De
Preferred Stock - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Class of Stock [Line Items] | ||
Dividends paid | $ 1,951 | $ 1,500 |
Series A preferred stock | ||
Class of Stock [Line Items] | ||
Preferred stock dividend accrual rate | 8.75% | |
Dividends paid | $ 2,000 | |
Dividend accrual | $ 2,000 |
Preferred Stock - Summary of Pr
Preferred Stock - Summary of Preferred Equity Balance (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Beginning balance | $ 87,288 |
Repurchase of Series A Preferred Stock | 0 |
Accumulated dividends on Series A Preferred Stock | 0 |
Ending balance | $ 87,288 |
Derivative Instruments - Narrat
Derivative Instruments - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Collateral paid | $ 0.1 | $ 0.1 |
Derivative Instruments - Schedu
Derivative Instruments - Schedule of Notional Amounts (Details) - Buy MWh in Thousands, MMBTU in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021MMBTUMWh | Dec. 31, 2020MMBTUMWh | |
Non-trading | Natural Gas | ||
Derivatives, Fair Value [Line Items] | ||
Net notional volume (energy measure) | 2,183 | 2,880 |
Non-trading | Electricity | ||
Derivatives, Fair Value [Line Items] | ||
Net notional volume (energy measure) | MWh | 1,843 | 1,845 |
Trading | Natural Gas | ||
Derivatives, Fair Value [Line Items] | ||
Net notional volume (energy measure) | 105 | 102 |
Derivative Instruments - Gains
Derivative Instruments - Gains (Losses) on Derivative Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) on derivatives, net | $ 7,024 | $ (24,587) |
Total current period settlements on derivatives | (1,185) | 16,608 |
Non-trading | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) on derivatives, net | 7,054 | (24,533) |
Total current period settlements on derivatives | (1,189) | 16,609 |
Trading | Various acquisitions | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total current period settlements on derivatives | (300) | |
Non-cash Flow Hedging | Trading | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (Loss) on derivatives, net | (30) | (54) |
Total current period settlements on derivatives | $ 4 | $ (1) |
Derivative Instruments - Offset
Derivative Instruments - Offsetting Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Total Derivative Assets | ||
Offsetting Assets [Line Items] | ||
Gross Assets | $ 4,006 | $ 420 |
Gross Amounts Offset | (2,267) | (109) |
Net Assets | 1,739 | 311 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | 1,739 | 311 |
Total Current Derivative Assets | ||
Offsetting Assets [Line Items] | ||
Gross Assets | 3,773 | 420 |
Gross Amounts Offset | (2,095) | (109) |
Net Assets | 1,678 | 311 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | 1,678 | 311 |
Non-trading commodity derivatives | ||
Offsetting Assets [Line Items] | ||
Gross Assets | 3,759 | 308 |
Gross Amounts Offset | (2,094) | (105) |
Net Assets | 1,665 | 203 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | 1,665 | 203 |
Trading commodity derivatives | ||
Offsetting Assets [Line Items] | ||
Gross Assets | 14 | 112 |
Gross Amounts Offset | (1) | (4) |
Net Assets | 13 | 108 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | 13 | 108 |
Total Non-current Derivative Assets | ||
Offsetting Assets [Line Items] | ||
Gross Assets | 233 | 0 |
Gross Amounts Offset | (172) | 0 |
Net Assets | 61 | 0 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | 61 | 0 |
Non-trading commodity derivatives | ||
Offsetting Assets [Line Items] | ||
Gross Assets | 233 | 0 |
Gross Amounts Offset | (172) | 0 |
Net Assets | 61 | 0 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | 61 | 0 |
Trading commodity derivatives | ||
Offsetting Assets [Line Items] | ||
Gross Assets | 0 | 0 |
Gross Amounts Offset | 0 | 0 |
Net Assets | 0 | 0 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | $ 0 | $ 0 |
Derivative Instruments - Offs_2
Derivative Instruments - Offsetting Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Total Derivative Liabilities | ||
Offsetting Liabilities [Line Items] | ||
Gross Liabilities | $ (7,116) | $ (12,051) |
Gross Amounts Offset | 3,709 | 4,233 |
Net Liabilities | (3,407) | (7,818) |
Cash Collateral Offset | 13 | 86 |
Net Amount Presented | (3,394) | (7,732) |
Total Current Derivative Liabilities | ||
Offsetting Liabilities [Line Items] | ||
Gross Liabilities | (6,626) | (11,213) |
Gross Amounts Offset | 3,394 | 3,622 |
Net Liabilities | (3,232) | (7,591) |
Cash Collateral Offset | 13 | 86 |
Net Amount Presented | (3,219) | (7,505) |
Non-trading commodity derivatives | ||
Offsetting Liabilities [Line Items] | ||
Gross Liabilities | (6,623) | (11,139) |
Gross Amounts Offset | 3,394 | 3,620 |
Net Liabilities | (3,229) | (7,519) |
Cash Collateral Offset | 13 | 86 |
Net Amount Presented | (3,216) | (7,433) |
Trading commodity derivatives | ||
Offsetting Liabilities [Line Items] | ||
Gross Liabilities | (3) | (74) |
Gross Amounts Offset | 0 | 2 |
Net Liabilities | (3) | (72) |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | (3) | (72) |
Total Non-current Derivative Assets | ||
Offsetting Liabilities [Line Items] | ||
Gross Liabilities | (490) | (838) |
Gross Amounts Offset | 315 | 611 |
Net Liabilities | (175) | (227) |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | (175) | (227) |
Non-trading commodity derivatives | ||
Offsetting Liabilities [Line Items] | ||
Gross Liabilities | (490) | (838) |
Gross Amounts Offset | 315 | 611 |
Net Liabilities | (175) | (227) |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | (175) | (227) |
Trading commodity derivatives | ||
Offsetting Liabilities [Line Items] | ||
Gross Liabilities | 0 | 0 |
Gross Amounts Offset | 0 | 0 |
Net Liabilities | 0 | 0 |
Cash Collateral Offset | 0 | 0 |
Net Amount Presented | $ 0 | $ 0 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 6,264 | $ 6,778 |
Accumulated depreciation | (2,808) | (3,424) |
Property and equipment—net | 3,456 | 3,354 |
Information technology | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 5,307 | 5,821 |
Information technology | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives (years) | 2 years | |
Information technology | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives (years) | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 957 | $ 957 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives (years) | 2 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives (years) | 5 years |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 0.4 | $ 0.6 | |
Information technology | |||
Property, Plant and Equipment [Line Items] | |||
Costs associated with assets not yet placed into service | $ 0.8 | $ 0.7 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Goodwill, Customer Relationships and Trademarks (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | $ 120,343 | $ 120,343 |
Total | 19,047 | |
Customer relationships—Acquired | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 58,688 | 58,688 |
Accumulated amortization | (46,445) | (44,175) |
Total | 12,243 | 14,513 |
Customer relationships—Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 8,898 | 8,988 |
Accumulated amortization | (6,415) | (5,733) |
Total | 2,483 | 3,255 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 7,570 | 7,570 |
Accumulated amortization | (3,249) | (2,972) |
Total | $ 4,321 | $ 4,598 |
Intangible Assets - Changes in
Intangible Assets - Changes in Goodwill, Customer Relationships and Trademarks (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Goodwill [Roll Forward] | |
Balance at beginning of period | $ 120,343 |
Amortization | 0 |
Balance at end of period | 120,343 |
Finite-lived Intangible Assets [Roll Forward] | |
Balance at end of period | 19,047 |
Customer Relationships— Acquired | |
Goodwill [Roll Forward] | |
Adjustments | 0 |
Finite-lived Intangible Assets [Roll Forward] | |
Balance at beginning of period | 14,513 |
Adjustments | 0 |
Amortization | (2,270) |
Balance at end of period | 12,243 |
Customer Relationships— Other | |
Goodwill [Roll Forward] | |
Adjustments | (28) |
Finite-lived Intangible Assets [Roll Forward] | |
Balance at beginning of period | 3,255 |
Adjustments | (28) |
Amortization | (744) |
Balance at end of period | 2,483 |
Trademarks | |
Goodwill [Roll Forward] | |
Adjustments | 0 |
Finite-lived Intangible Assets [Roll Forward] | |
Balance at beginning of period | 4,598 |
Adjustments | 0 |
Amortization | (277) |
Balance at end of period | $ 4,321 |
Intangible Assets - Estimated F
Intangible Assets - Estimated Future Amortization Expense (Details) $ in Thousands | Mar. 31, 2021USD ($) |
Year ending December 31, | |
2021 (remaining nine months) | $ 9,823 |
2022 | 6,194 |
2023 | 605 |
2024 | 404 |
2025 | 404 |
> 5 years | 1,617 |
Total | $ 19,047 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||
Total long-term debt | $ 145,000 | $ 100,000 | |
Total debt | 145,000 | 100,000 | |
Senior credit facility | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 135,000 | 100,000 | |
Weighted average interest rate | 3.75% | 3.75% | |
Letters of credit issued | $ 29,700 | 31,000 | |
Subordinated debt | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 10,000 | $ 0 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Jul. 31, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Aug. 18, 2020 | |
Debt Instrument [Line Items] | ||||
Subordinated debt | $ 10,000,000 | $ 0 | ||
Outstanding under subordinated note | 145,000,000 | 100,000,000 | ||
Common Class A | ||||
Debt Instrument [Line Items] | ||||
Share repurchase program, amount authorized | $ 20,000,000 | |||
Fourth amendment to senior credit facility | Share buyback loans | ||||
Debt Instrument [Line Items] | ||||
Share repurchase program, amount authorized | $ 80,000,000 | |||
Senior secured revolving credit facility | ||||
Debt Instrument [Line Items] | ||||
Fixed charge coverage ratio | 148.00% | |||
Leverage ratio | 145.00% | |||
Senior secured leverage ratio | 124.00% | |||
Senior secured revolving credit facility | Common Class A | ||||
Debt Instrument [Line Items] | ||||
Repurchase, aggregate amount | 10,000,000 | |||
Senior secured revolving credit facility | Series A preferred stock | ||||
Debt Instrument [Line Items] | ||||
Share repurchase program, amount authorized | $ 92,700,000 | |||
Senior secured revolving credit facility | Common class A and common class B | ||||
Debt Instrument [Line Items] | ||||
Default share limit, minimum amount (in shares) | 13,600,000 | |||
Senior credit facility | Fourth amendment to senior credit facility | Common Class A | Share buyback loans | ||||
Debt Instrument [Line Items] | ||||
Shares authorized to be repurchased (in shares) | 8,000,000 | |||
Senior credit facility | Fourth amendment to senior credit facility | Series A preferred stock | Share buyback loans | ||||
Debt Instrument [Line Items] | ||||
Shares authorized to be repurchased (in shares) | 80,000,000 | |||
Senior credit facility | Senior secured revolving credit facility | ||||
Debt Instrument [Line Items] | ||||
Fixed charge coverage ratio | 125.00% | |||
Leverage ratio | 250.00% | |||
Senior secured leverage ratio | 185.00% | |||
Debt default, material judgment (in excess of) | $ 5,000,000 | |||
Subordinated debt | Retailco | ||||
Debt Instrument [Line Items] | ||||
Subordinated debt | 25,000,000 | |||
Subordinated debt, advances, no less than | $ 1,000,000 | |||
Subordinated debt, interest rate on advances | 5.00% | |||
Minimum availability under the borrowing base | $ 5,000,000 | |||
Outstanding under subordinated note | $ 10,000,000 | 0 | ||
Revolving credit facility | Fourth amendment to senior credit facility | Eurodollar | Share buyback loans | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 4.50% | |||
Revolving credit facility | Fourth amendment to senior credit facility | Base rate | Share buyback loans | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 3.50% | |||
Revolving credit facility | Senior credit facility | ||||
Debt Instrument [Line Items] | ||||
Capitalized financing costs | $ 1,400,000 | 1,600,000 | ||
Capitalized financing costs, other current | 1,000,000 | 1,000,000 | ||
Capitalized financing costs, other non-current | 400,000 | $ 600,000 | ||
Line of credit facility, maximum borrowing capacity | $ 227,500,000 | |||
Nonutilization fee, percent | 0.50% | |||
Revolving credit facility | Senior credit facility | Fourth amendment to senior credit facility | Eurodollar | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 3.25% | |||
Revolving credit facility | Senior credit facility | Fourth amendment to senior credit facility | Base rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.25% | |||
Revolving credit facility | Senior credit facility | Fourth amendment to senior credit facility | Federal funds rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.50% | |||
Revolving credit facility | Senior credit facility | Fourth amendment to senior credit facility | Reference eurodollar rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 1.00% |
Debt - Components of Interest E
Debt - Components of Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Line of Credit Facility [Line Items] | ||
Amortization of deferred financing costs | $ 259 | $ 250 |
Interest Expense | 1,311 | 1,553 |
Other | ||
Line of Credit Facility [Line Items] | ||
Senior Credit Facility | 182 | 0 |
Senior Credit Facility | Senior credit facility | ||
Line of Credit Facility [Line Items] | ||
Senior Credit Facility | 468 | 911 |
Working capital facility | ||
Line of Credit Facility [Line Items] | ||
Letters of credit fees and commitment fees | $ 402 | $ 392 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Credit risk valuation adjustment | $ 200 | $ 200 |
Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 1,739 | 311 |
Total commodity derivative liabilities | (3,394) | (7,732) |
Recurring | Non-trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 1,726 | 203 |
Total commodity derivative liabilities | (3,391) | (7,660) |
Recurring | Trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 13 | 108 |
Total commodity derivative liabilities | (3) | (72) |
Recurring | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 0 | 104 |
Total commodity derivative liabilities | (6) | (5) |
Recurring | Level 1 | Non-trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 0 | 104 |
Total commodity derivative liabilities | (6) | (5) |
Recurring | Level 1 | Trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 0 | 0 |
Total commodity derivative liabilities | 0 | 0 |
Recurring | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 1,739 | 207 |
Total commodity derivative liabilities | (3,388) | (7,727) |
Recurring | Level 2 | Non-trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 1,726 | 99 |
Total commodity derivative liabilities | (3,385) | (7,655) |
Recurring | Level 2 | Trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 13 | 108 |
Total commodity derivative liabilities | (3) | (72) |
Recurring | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 0 | 0 |
Total commodity derivative liabilities | 0 | 0 |
Recurring | Level 3 | Non-trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 0 | 0 |
Total commodity derivative liabilities | 0 | 0 |
Recurring | Level 3 | Trading commodity derivative | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total commodity derivative assets | 0 | 0 |
Total commodity derivative liabilities | $ 0 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Related Party Transaction [Line Items] | ||
Income tax rate | 5.30% | 16.10% |
U.S federal statutory tax rate | 21.00% | |
NuDevco retail holdings and NuDevco retail | ||
Related Party Transaction [Line Items] | ||
Deferred tax assets | $ 33 | |
Net deferred tax asset | $ 15.6 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Litigation and regulatory matters | ||
Loss Contingencies [Line Items] | ||
Contingent liabilities | $ 22.9 | $ 26.6 |
Indirect tax audits | ||
Loss Contingencies [Line Items] | ||
Contingent liabilities | 1.1 | $ 1.2 |
Verde Energy USA, Inc. | ||
Loss Contingencies [Line Items] | ||
Damages penalty | 1 | |
Settlement | $ 0.1 |
Transactions with Affiliates (D
Transactions with Affiliates (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Jun. 30, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | ||||
General and administrative | $ 12,671,000 | $ 25,676,000 | ||
Current accounts receivable - affiliates | 5,264,000 | $ 5,053,000 | ||
Current accounts payable - affiliates | 1,259,000 | 826,000 | ||
Revenues recorded in net asset optimization revenues related to affiliates | (140,000) | 321,000 | ||
Affiliated entity | ||||
Related Party Transaction [Line Items] | ||||
Revenues recorded in net asset optimization revenues related to affiliates | 300,000 | 500,000 | ||
Affiliated entity | Subordinated debt facility | ||||
Related Party Transaction [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 25,000,000 | |||
Subordinated debt, advances | $ 1,000,000 | |||
Subordinated debt, interest rate on advances | 5.00% | |||
Outstanding under subordinated note | 10,000,000 | $ 0 | ||
Affiliated entity | Allocated overhead costs | ||||
Related Party Transaction [Line Items] | ||||
Affiliate expenses | (800,000) | (200,000) | ||
General and administrative | 100,000 | 0 | ||
Affiliated entity | Purchased natural gas from affiliate | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues recorded in net asset optimization revenues (less than) | 100,000 | 200,000 | ||
NuDevco retail holdings and NuDevco retail | ||||
Related Party Transaction [Line Items] | ||||
Distributions to affiliates | 3,800,000 | 3,800,000 | ||
NuDevco retail holdings and NuDevco retail | Payment of income taxes incurred by the company | ||||
Related Party Transaction [Line Items] | ||||
Distributions to affiliates | $ 2,700,000 | $ 3,400,000 |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting [Abstract] | ||
Asset optimization revenue | $ 25.7 | $ 6.4 |
Asset optimization cost of revenues | $ 25.8 | $ 6.1 |
Segment Reporting - Reconciliat
Segment Reporting - Reconciliation of Retail Gross Margin to Income Before Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Segment Reporting Information [Line Items] | ||
(Loss) income before income tax (benefit) expense | $ (29,095) | $ 11,993 |
Interest and other income | (86) | (160) |
Interest expense | 1,311 | 1,553 |
Operating (loss) income | (27,870) | 13,386 |
Depreciation and amortization | 6,036 | 8,796 |
General and administrative | 12,671 | 25,676 |
Less: | ||
Net asset optimization (expense) revenues | (140) | 321 |
Net, gain (loss) on non-trading derivative instruments | 7,024 | (24,587) |
Net, Cash settlements on non-trading derivative instruments | (1,185) | 16,293 |
Non-recurring event - Winter Storm Uri | (64,900) | 0 |
Retail Gross Margin | 50,012 | 55,461 |
Non-trading | ||
Less: | ||
Net, gain (loss) on non-trading derivative instruments | 7,054 | (24,533) |
Net, Cash settlements on non-trading derivative instruments | $ (1,189) | $ 16,609 |
Segment Reporting - Financial D
Segment Reporting - Financial Data for Business Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Segment Reporting Information [Line Items] | |||
Total Revenues | $ 113,005 | $ 166,681 | |
Retail cost of revenues | 122,168 | 118,823 | |
Less: | |||
Net asset optimization (expenses) revenues | (140) | 321 | |
Net, gain (loss) on non-trading derivative instruments | 7,024 | (24,587) | |
Current period settlements on non-trading derivatives | (1,185) | 16,608 | |
Non-recurring event - Winter Storm Uri | (64,900) | 0 | |
Retail Gross Margin | 50,012 | 55,461 | |
Total Assets | 364,327 | $ 366,667 | |
Goodwill | 120,343 | 120,343 | |
Non-trading | |||
Less: | |||
Net, gain (loss) on non-trading derivative instruments | 7,054 | (24,533) | |
Current period settlements on non-trading derivatives | (1,189) | 16,609 | |
Operating segments | Retail Electricity | |||
Segment Reporting Information [Line Items] | |||
Total Revenues | 78,755 | 121,768 | |
Retail cost of revenues | 107,524 | 100,383 | |
Less: | |||
Net asset optimization (expenses) revenues | 0 | 0 | |
Non-recurring event - Winter Storm Uri | (64,900) | ||
Retail Gross Margin | 30,614 | 30,806 | |
Total Assets | 2,961,333 | 2,906,139 | |
Goodwill | 117,813 | 117,813 | |
Operating segments | Retail Electricity | Non-trading | |||
Less: | |||
Net, gain (loss) on non-trading derivative instruments | 6,705 | (24,386) | |
Current period settlements on non-trading derivatives | (1,188) | 14,965 | |
Operating segments | Retail Natural Gas | |||
Segment Reporting Information [Line Items] | |||
Total Revenues | 34,390 | 44,592 | |
Retail cost of revenues | 14,644 | 18,440 | |
Less: | |||
Net asset optimization (expenses) revenues | 0 | 0 | |
Non-recurring event - Winter Storm Uri | 0 | ||
Retail Gross Margin | 19,398 | 24,655 | |
Total Assets | 970,315 | 941,569 | |
Goodwill | 2,530 | 2,530 | |
Operating segments | Retail Natural Gas | Non-trading | |||
Less: | |||
Net, gain (loss) on non-trading derivative instruments | 349 | (147) | |
Current period settlements on non-trading derivatives | (1) | 1,644 | |
Corporate and Other | |||
Segment Reporting Information [Line Items] | |||
Total Revenues | (140) | 321 | |
Retail cost of revenues | 0 | 0 | |
Less: | |||
Net asset optimization (expenses) revenues | (140) | 321 | |
Non-recurring event - Winter Storm Uri | 0 | ||
Retail Gross Margin | 0 | 0 | |
Total Assets | 330,327 | 318,865 | |
Goodwill | 0 | 0 | |
Corporate and Other | Non-trading | |||
Less: | |||
Net, gain (loss) on non-trading derivative instruments | 0 | 0 | |
Current period settlements on non-trading derivatives | 0 | 0 | |
Eliminations | |||
Segment Reporting Information [Line Items] | |||
Total Revenues | 0 | 0 | |
Retail cost of revenues | 0 | 0 | |
Less: | |||
Net asset optimization (expenses) revenues | 0 | 0 | |
Non-recurring event - Winter Storm Uri | 0 | ||
Retail Gross Margin | 0 | 0 | |
Total Assets | (3,897,648) | (3,799,906) | |
Goodwill | 0 | $ 0 | |
Eliminations | Non-trading | |||
Less: | |||
Net, gain (loss) on non-trading derivative instruments | 0 | 0 | |
Current period settlements on non-trading derivatives | $ 0 | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent event | Apr. 21, 2021$ / shares |
Common Class A | |
Subsequent Event [Line Items] | |
Dividends declaration per share of common stock (in dollars per share) | $ 0.18125 |
Series A preferred stock | |
Subsequent Event [Line Items] | |
Dividends declaration per share of preferred stock (in dollars per share) | $ 0.546875 |