GNE - Earnings call transcript Q1 2019

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Operator

Good morning and welcome to Genie Energy's First 2019 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] In this presentation Genie Energy's management team will discuss financial and operational results for the three months period ending March 31, 2019. Any forward looking statements may during this conference call either in the prepared remarks or in the question-and-answer session whether general or specific in nature are subject to risks and uncertainties that may cause actual results to differ materially from those which the company anticipates. These risks and uncertainties include, but are not limited to specific risks and uncertainties discussed in the report that Genie Energy files periodically with the SEC. cause obligation have update or they made the that no statements forward to forecast. assumes differ factors they to that or may Energy either those any to looking update materially Genie from results that actual may make

this non-GAAP www.genie.com. filed or EBITDA After also not release opportunity the release the Instructions] to website, Relations investors available segments' During to Energy's The a by provides a Officer. to recorded. management earnings to may and turn on an Form to SEC. useful be excluding Chief ahead which results. management Energy's indicative Genie note may that certain the ask Please page reconciliation I Investor EBITDA believes Energy's remarks, there [Operator like The Genie been of that reference to operating relevant information Management Executive go their event today's Mr. EBITDA, of with Genie adjusted questions. by presentation expenses adjusted management, conference Stein, on is the Genie X-K make Stein. is measure. Energy's adjusted is core Energy including net earnings income both now Genie being Please Michael has Genie be a over the will Corporation would of

Michael Stein

our Financial period follow for will strategy three-months Goldin, earnings an we today Chief Officer will Today, our the business call. March discuss My Welcome results. of quarter and with results. Thank and first Operator. operational financial Energy's will Avi on overview you, results Genie to XX, our financial focus our operational remarks ended XXXX.

glad will your to we questions. remarks, take Avi's be Following

our across At for meter base. meter and energy quarter customer our strong core diversified RCEs In we XX,XXX significantly operational a The meters XX,XXX by growth RCE XX,XXX our retail notable and and expanded U.S. XX,XXX saw similarly counts was increased and the the respectively. to and enterprise. strong we respectively. progress overseas supply RCEs meters We business, our increased where by XXX,XXX base XXX,XXX first

and through stand Our base in XXX,XXX the stake of acquired Lumo closed XXX,XXX increase now global meter our the supplier count Finnish global our retail is majority by purchase in on at meters customer a in Energia, RCE which January. energy was the our facilitated count we

venture which Continued approximately organic, quarter, UK and joint meter XX,XXX where in during first our closed at New deal here in acquisition the added municipal meters. Energy, Orbit we aggregation Jersey the the

We also benefited domestic from strong channels. execution in sales our

we focused Across U.S., we the growth has retail to the our of that X.XX especially meters, XXXX later business, per been has unit enhanced paying X.XX expect effort continue that The have to trend economics. higher our averaged energy increase our acquisition improved a year. XX, relative meter. March in this have ratio of We here been per At meter, on we year consumption increased off. on we RCE return RCE and the investment

and expect Looking retail Texas. commercial most residential is X the million dynamic begin Texas of the to quarter, largest in energy market second over one we country's meters. the ahead with retail markets to electric testing and

Lumo geographies start our Orbit and and drives Overseas, approach JV out. friends Energia larger for to international is Outside soon additional markets meters then will roll their customer a current Genie its and leverage our overhead within while We acquisition minimizing both we exploring need tailor specific of Japan investment. existing we up operations are very strong continued as launching family to new by ramping our new in avenues to our for add footprint, our market localized to Energy offering and engine. the

first other to year and clients, by growth drove terrific $X to customer million retail on for sourced EBITDA line and from quarter Services. our and the first service potential who robust fourth in the its Prism become Turning commercial solutions. has projects over adding revenue. quarter in quarter will strong service operations, and Solar in demonstrating Prism expect acquisition strong our top of blue and a contributor positive very GES Energy Overall, operational business solar revenue Prism's last Genie generated key Solar were build prefer while the solar turned in businesses. chip larger across our Powered The early to domestically of our pipeline it I its now quarter, increase and results fantastic a to additional by of a as the continues bottom grow. success

for As delivering EBITDA. income accomplished XXXX this the adjusted look with forward reporting from Avi to I'm throughout pleased very operations levels we you, consolidated and progress the to all continued increased by detail year. start will of and

the Now discuss to here Financial is our quarter's Avi Chief first Goldin, Officer, results. financial

Avi Goldin

My Thank the on our remarks today we this our we March months joining how cover us of businesses. Lumo Please morning. disclosure you, three to acquisition the for financial modified Michael, XXst. Finland manage note for that thanks reflect following and quarter better results have this in ended segment the everyone our call to

stake Energy UK, We our currently the are energy Lumo. operates reporting Energy new and venture, a Japan International, the International, Genie operations. which which will include in retail of Retail businesses provider Orbit consist segment, our in GRE or GE overseas These

Genie energy retail provider business Energy, domestic will GRE. continue to be Our Retail or reported within

as first quarter remarks, company segments holds will GES, minority brokerage Diversegy compare $XX.X the $XXX,XXX. captures impact million Services, seasonal and Stronger of revenue gas gas peak domestic to suspended gross margins GES, gross acquisition reflecting on to also generating from in early quarter in Consolidated million million. expense a decline in consumption decline first Energy overcame both an Afek, services by Prism lower million. Oil and from decrease GRE focusing $XX.X the year season, acquisition million our Northern XXXX gross the Israel decreased Israel. which our the $XX.X profit reductions oil are in last and in Consolidated the to meters the Genie Consolidated than offset and GES to The domestic expense that SG&A report $XX.X million, drilling first corporate served. $XX.X natural $XX.X expense, first slightly profit my average million year-over-year of quarter. the January; more was revenue of by boost quarter $XX.X stock-based in winter's $XXX,XXX, position characteristic a drive natural Genie the revenue $X.X largely I for was to sales the in quarter in GRE's acquisition increased number the reflects of Gas, increase $X.X and of strong which holds XXXX International rather in in gas or in decrease our business; to business. first revenue, from million the continue fourth to businesses following consideration helped revenue by decreased currently results most electricity GRE's removes decrease comparison exploration The the sequential on million energy customer quarter the while of Throughout and located electricity. compensation. some gross solar GRE and Lumo by primarily decline will also Atid, the by a increased of retail contribution our and the and Typically, where to We profit of overhead heating project than factors the in by driven GOGAS contributed quarter

Equity That pending suspended and and in our was operations results, For well to we which the $XXX,XXX minority expense in was the Orbit nil to to issuance compared in as XXXX. Energy first exploration oil the year third quarter. the to the Afek interest equity of quarter stake operations of for in ago conduct. method expense final the plan $XXX,XXX gas consecutive including compared $XXX,XXX net loss of permits quarter, of the in testing report use Atid,

acquisition We adjusted the are its EBITDA million $XX.X Our in customer the income compensation, which to decreased UK $X.X invest year large margins from a asset. continued our overseas. increases The year-over-year in factors as million. on million new I income operations and domestic increase $X.X from to contributed XXXX in to the builds was the from million, Orbit of EBITDA, million to year million and $XXX,XXX in $X.X reflect base the first the for in increase ago in part increased increased million gross the to from more stronger than taxes consolidated our ago of offset $X.X $X.X stock-based retail and million $X.XX acquisitions investment mentioned customer of income expense, provision year reduced as meter $X.X quarter, of in GRE the impact in deferred to due million. operations the corporate-level all an while quarter of earlier: the the compared continuing Energy part it the of adjusted compared in in $XX.X to increased adjustment quarter quarter quarter for EPS contributed $XX.X $X.XX tax ago quarter to allowance domestic

XXst, outlook, To wrap we totalled Our a million cash dividend on of current quarter, robust we and his liabilities, by $XX.X up, operating stock our Michael assets, financial $XX.X we strong. Working adjusted less to invested positive our in cash. again discussed share. Directors remains $XX.X restricted equivalents increases assets grow reported year-over-year robust from of and as capital, financial quarterly Supported although this our in headlined achieved balance $XXX.X in Board a results million. strong customer sheet At operations EBITDA. results and a common including total our by income global $X.XXX declared million the Liabilities quarter first base March was cash, significantly in from in million. current our remarks,

diversified pursue liquid ahead. us of base, abundant meter and continue flexibility strong the sheet growing gives plenty to to our ahead, Looking growth operations balance opportunities

turn operator back Q&A. I'll for call the to Now the

Operator

Thank you.

Mike [Operator the our first go begin comes Heim Please NOBLE now will of We Financial. question ahead. question-and-answer from Instructions] session. And

Mike Heim

good quarter, to you. there. growth see Great Thank the

little electrically electric, And a As retail bit drop Did be in that the in New related? the acquisition? the energy attributed that the I in me by a just at Can more to lines, on category. electric-related a of kind be growth and a drop revenue drop, color gas more can just temperatures? prices milder to Or strong little and gas the the Jersey tell real you tend gas. look of

Avi Goldin

this morning, Avi. Mike. Sure, is Good

what period deal shift was so electric this that aggregation you a mentioned. the But in the is little Jersey on of more just the also and bit quarter you're last factors year. base there – from a mix side meter lower as same to than in seeing mix in a to meter on you're had referring is consumption, the So given primarily smaller saw some the also somewhat – was as base, gas weather electric we side, New by gas in in side the we driven the natural

Mike Heim

Okay. Is pipeline? And addition a pipeline of is at in Or business understand of estimate bit. look grown a with revenue that seasonality help then new of be any these there you some described? as Prism, that? the kind fully to $X we the in good million me by the that little What's

Michael Stein

Hi, this the Stein, Michael is thanks for question.

on the consistent business. seasonality there's So effect We're a basis. Prism on to what ready no not guidance on to expect give

We the are excited by pipeline.

not excited but integrating by pretty we're our still just it new, to and the give ready are guidance. general We we're it's since business, business, into

Mike Heim

What necessarily fair. pipeline? more exactly when Okay. in looking just I'm But say new stuff not little talk bit you means? that for you a the guidance. can That's

Michael Stein

means more commercial just It customers. Yes. large

Mike Heim

be? Okay. All add the the family. color talked we new on then and second what friends next about – talk of launch little What right. some the you and you a more would about can Texas, stage And as

Michael Stein

that state question? Was What would the the next be?

Mike Heim

No.

Next stage…

Michael Stein

sorry. stage, Next

Mike Heim

In on terms out? start when some of of customers helping being et kind see cetera. we data can added, And roll to

Michael Stein

Yes, sure.

we the So a soft we do of that make is with on offering markets with the family. market go and than our kicked out, go then the a kinks. Usually, ironed different into or other market month that out tires systems the structure typically, a we've new been of the friends offering and launch two where whenever – we sure we we've in, and just and any to lasts intensely. And

Mike Heim

Okay. your you Great, thank answers. for

Michael Stein

Sure.

Operator

Capital Management. ahead. Our next question Mountain go comes of from Aaron Great Please Shafter

Aaron Shafter

decrease correctly, thanks another strong taking meters Congrats heard call. my correct? in was quarter. I Hi, Is for domestically. a on that If there very

Michael Stein

No.

our we meter in that where smaller QX was let's be saw – the to the base say, the Avi But we where previous a referencing think there in in, on we may general, year, very I increase today, meter base. quarter-over-quarter, were very, gas XXXX, are significant side. a

Aaron Shafter

me. Bad said about up quarter. to release, to that can you you the second percent quarter. you than make I We're I've Okay. In it didn’t definitive the more expect be hearing, – question guess. if Alright. I'm the into a Because launch second sense in press XX-some My wondering that. question Texas. any

Michael Stein

those expect first still take – first second the to in We customers on the quarter. in

Aaron Shafter

Okay.

planned You don't date? are – you the any have launch you do second Or – it just is quarter? saying just

Michael Stein

No.

expect customers bring first to this month. We on first our customers

Aaron Shafter

to – be as last any last if at permitting that the correctly, kind going. And – you the the of how process to be I'm I as when do far half in get the – is you project you to you We're that. during expected said expect you that have first complete to give in Golan, able And the year. then closer if Okay. complete call, wondering the And getting and on Afek done can of testing recall update – earnings when and you expected, permitting any and if testing? the the

Michael Stein

it I we expect of we've long- sure to to on run said We've our permitting think we that test be we've now, expense, to from a ordered completely thorough past a material gotten findings that order. Obviously, this do as we is we we've test do the analysis test. but our the don't to right make expect want which to significant we pieces there. done clearance. of something quarters, need in we're are, The equipment able item that at short some stage perspective, lead be in to

So first I'm but might else the – slip half a – might that little we expect is said everything completing year test, happen. the we bit, of we've – to

Aaron Shafter

Okay.

now waiting the and equipment So, you've Is that correct? to permits, conduct the the you're on gotten test.

Michael Stein

Yes.

Aaron Shafter

Okay. That’s it.

Michael Stein

Thank you.

Operator

question ahead. Kevin next of Instructions]Our Schneider Investor. from Please Private [Operator comes go

Kevin Schneider

Are the bidding mechanics agreement? other you municipal against exactly you for did could How work? customers? explain the companies Gentlemen, aggregation of that

Michael Stein

customers, expiration fixed has Yes. brokering was bid. are due And comfortable Typically, ability municipal generally the the speaking, that the we the aggregations, those and the yes, a company deals they against an us. found we municipality competitive aggregation with deal have time. other of for renew But it's bid to when come and is period because a

Kevin Schneider

you, Thank sir.

Operator

question-and-answer the Thank concludes presentation. our for you call. attending This session and today's conference

may You disconnect. now

Genie Energy (GNE) 6 May 192019 Q1 Earnings call transcript