• Income from Operations: $12 million in Q3 2024.
• Adjusted EBITDA: $14 million in Q3 2024; $37 million for the first nine months of 2024.
• Revenue: Decreased 10.5% to $111.9 million in Q3 2024.
• GRE Revenue: Declined 12.1% to $105.8 million in Q3 2024.
• Grew Revenue: Increased 29.2% to $6.1 million in Q3 2024.
• Gross Profit: $37.9 million with a gross margin of 33.9% in Q3 2024.
• SG&A Expenses: Increased 8.5% to $25.2 million in Q3 2024.
• Net Income per Diluted Share: $0.38 in Q3 2024.
• Cash and Equivalents: $191.7 million as of September 30, 2024.
• Share Repurchases: Approximately 123,000 shares repurchased in Q3 2024.

• Warning! GuruFocus has detected 4 Warning Sign with GNE.

Release Date: November 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Genie Energy Ltd (NYSE:GNE) reported strong third-quarter results with $12 million in income from operations and $14 million in adjusted EBITDA.
• The company added approximately 36,000 net new meters in its retail energy business, contributing to a 3.5% increase in meters served compared to the previous year.
• Genie Energy Ltd (NYSE:GNE) expanded its market presence by entering the California residential natural gas market, adding to its operations in 19 states and Washington DC.
• The company's renewable business, GREW, saw revenue double from the previous year, driven by its energy procurement advisory business and solar projects.
• Genie Energy Ltd (NYSE:GNE) returned value to shareholders through dividends and repurchased approximately 123,000 shares for $2 million in the third quarter.

Negative Points

• Consolidated revenue for the third quarter decreased by 10.5% to $111.9 million, primarily due to a decline in GRE's revenue.
• The decrease in GRE's revenue was attributed to lower per meter consumption, driven by milder weather during the summer cooling season.
• Income from operations decreased by 34.7% to $11.7 million, and adjusted EBITDA decreased by 26.7% to $13.6 million.
• The company recorded a non-cash expense of $991,000 related to a loss reserve by its captive insurance subsidiary, impacting GAAP income.
• Genie Energy Ltd (NYSE:GNE) experienced a decrease in kilowatt hours sold and increased customer acquisition costs at GRE, affecting financial performance.

Q & A Highlights

Q: Can you provide an overview of Genie Energy's financial performance for the third quarter of 2024? A: Michael Stein, CEO, highlighted that Genie Energy generated $12 million in income from operations and $14 million in adjusted EBITDA. The company is on track to reach the high end of its annual adjusted EBITDA guidance of $40 to $50 million. Avi Goldin, CFO, noted that consolidated revenue decreased by 10.5% to $111.9 million, primarily due to lower electricity consumption at GRE. However, revenue at GREW increased by 29.2% to $6.1 million, driven by growth in the Diversegy business and solar projects.

Q: What strategic initiatives is Genie Energy pursuing to drive growth? A: Michael Stein, CEO, mentioned that Genie Energy is expanding its retail energy business by entering new markets, such as California for residential natural gas. The company is also focusing on utility-scale solar projects and diversifying its energy procurement advisory business. These initiatives aim to enhance top-line growth and improve operating margins.

Q: How is Genie Energy managing its customer acquisition and retention efforts? A: Michael Stein, CEO, explained that the company is balancing customer acquisition and retention by pursuing aggregation deals, which add significant net new meters with minimal sales and administrative expenses. This strategy has helped grow the number of meters served to 399,000, a 3.5% increase from the previous year.

Q: Can you elaborate on the performance and future prospects of the Diversegy business? A: Michael Stein, CEO, reported that Diversegy's revenue doubled from the previous year, contributing to positive adjusted EBITDA for the first time since its acquisition. The company aims to maintain a similar growth pace over the next year, turning Diversegy into a consistent growth engine for Genie Energy.

Q: What are the financial highlights from the solar development side of Genie Energy's business? A: Michael Stein, CEO, stated that the strategic focus on utility-scale solar projects has led to a doubling of gross profit compared to the previous year. The company has expanded its development pipeline and expects to close a project finance loan that will return approximately $7 million in cash to the balance sheet.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.