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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 8-K

 

 

 

CURRENT REPORT

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

 

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

 

 

 

GENIE ENERGY LTD.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   1-35327   45-2069276

(State or other jurisdiction

of incorporation)

  (Commission File Number)  

(IRS Employer

Identification No.)

 

520 Broad Street

Newark, New Jersey

  07102
(Address of principal executive offices)   (Zip Code)

 

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

 

Not Applicable

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

 

 

 

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

 

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

 

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

 

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

 

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

 

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

 

Title of each class   Trading Symbol  

Name of each exchange on which registered

Class B common stock, par value $.01 per share   GNE   New York Stock Exchange

 

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

 

Emerging growth company   ☐

 

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

 

 

 



 

Item 2.02. Results of Operations and Financial Condition.

 

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

 

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

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

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

 

1


 

SIGNATURE

 

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

 

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

 

Dated: August 6, 2024

 

2


 

EXHIBIT INDEX

 


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

 

3

 

EX-99.1 7 ex991_1.htm EXHIBIT 99.1

Exhibit 99.1

 

Graphics

 

Genie Energy Announces Second Quarter 2024 Results

 

 

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

 

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


"Our solid second quarter results reflect the investments in meter and RCE growth we made in the first half of last year, combined with a stable, normalized retail energy environment. We also delivered a solid performance at Genie Renewables, where Diversegy and our operational solar farms helped drive 7% revenue growth and over 700 basis points of gross margin expansion.


"Our strong performance over the first half of 2024 puts us on track to achieve our full year guidance of $40 to $50 million in consolidated Adjusted EBITDA.  In the second quarter, we also improved our ability to fund growth and capital return initiatives by increasing our net cash, cash equivalents and marketable securities by nearly $16 million, even while in investing in our business, paying out our quarterly dividend and repurchasing $2.6 million of our common stock." 

 

Second Quarter 2024 Highlights


(Unless otherwise noted, 2Q24 results are compared to 2Q23, and results of Genie Retail Energy International (GREI) are included in discontinued operations for all periods.) 

 

Revenue decreased 3.0% to $90.7 million from $93.5 million;
Gross profit decreased 12.8% to $33.3 million from $38.2 million. Gross margin decreased to 36.8% from the stronger than usual 40.9% attained last year;  

Income from operations decreased to $10.6 million from $15.0 million;

Adjusted EBITDA1 decreased to $12.0 million from $15.8 million;

Net income attributable to Genie common stockholders and income per diluted share EPS attributable to Genie common stockholders of $9.6 million and $0.36 compared to $15.0 million and $0.57, respectively;
Non-GAAP net income1 and non-GAAP EPS1 attributable to Genie common stockholders of $10.1 million and $0.37 compared to $15.0 million and $0.57, respectively;

1


 


Cash and cash equivalents, short and long-term restricted cash, and marketable equity securities increased to $178.3 million at June 30, 2024, from $162.4 million at March 31, 2024;

Genie repurchased approximately 169,000 shares of its Class B Common stock for $2.6 million during 2Q24;


Genie will pay a $0.075 per share quarterly dividend to Class A and Class B common stockholders on August 22, 2024, with a record date of August 14, 2024.
1 Adjusted EBITDA, Non-GAAP net income (loss) attributable to Genie Energy Ltd. common stockholders, and Non-GAAP EPS for all periods presented are non-GAAP measures intended to provide useful information that supplements the core operating results in accordance with GAAP for Genie Energy or the relevant segment. Please refer to the Reconciliation of Non-GAAP Financial Measures at the end of this release for an explanation of these non-GAAP metrics, as well as reconciliations to its most directly comparable GAAP measures.

Select Financial Metrics

 

(in millions except for EPS)*   2Q24     2Q23     Change  
Total Revenue   $ 90.7     $ 93.5       (3.0) %
   Genie Retail Energy   $ 86.7     $ 89.7       (3.4) %
      Electricity
$ 78.3

$ 80.2


(2.4) %
      Natural Gas 
$ 8.4

$ 9.0


(6.2) %
      Others
$ 0.0

$ 0.6


(99.4) %
   Genie Renewables    $ 4.0     $ 3.7       6.6 %
Gross Margin      36.8 %     40.9 %     (412) bps
   Genie Retail Energy     37.2 %     41.8 %     (455) bps
   Genie Renewables     26.8 %     19.6 %     721 bps
Income from Operations   $ 10.6     $ 15.0       (29.7) %
Operating Margin       11.6 %     16.1 %     (444) bps
Net Income from Continuing Operations
$ 9.5 $ 12.2 (21.9) %
(Loss) Income Attributable to Discontinued Operations, Net of Tax

$ (0.1 )
$ 3.2


(104.6) %
Net Income Attributable to Genie Common Stockholders   $ 9.6     $ 15.0     (35.8) %
Diluted Earnings Per Share     $ 0.36     $ 0.57     (0.21) $
Non-GAAP Net Income Attributable to Genie Common Stockholders $ 10.1 $ 15.0 (32.7) %
Non-GAAP Diluted Earnings Per Share $ 0.37 $ 0.57 (0.20) $
Adjusted EBITDA   $ 12.0     $ 15.8       (24.0) %
Cash Flow from Continuing Operating Activities      $ 17.6     $ 3.0       486.9 %
* Numbers may not add due to rounding

2


Segment Highlights

 

Genie Retail Energy (GRE)

GRE's second quarter revenue decreased 3.4% to $86.7 million from $89.7 million last year. Income from operations decreased 20.7% to $14.6 million from $18.4 million, and Adjusted EBITDA decreased 20.7% to $14.9 million from $18.8 million driven by a reduction in gross margins on electricity sales from the exceptionally high levels attained in the year ago quarter.  Aggregate electricity units sold remained relatively consistent versus last year, as an increase in consumption per meter substantially offset a decrease in electricity meters served.  


GRE Select Performance Metrics


(RCEs and Meters in thousands)*     1Q23     2Q23     3Q23  

4Q23


1Q24
 
2Q24

2022  

2023
RCEs       352       380       375  

350


348
 
345

  262  

350
Electricity       276       304       298  

272


267
 
266

  181  

272
Natural Gas       77       76       77  

78


81
 
78

  81  

78
Meters       349       381       385  

361


365
 
362

  276  

361
Electricity       271       302       304  

279


281
 
278

  197  

279
Natural Gas       78       80       81  

82


83
 
84

  79  

82
Gross Adds       129       75       60  

52


70
 
53

  123  

52
Churn**       4.4 %     4.3 %     4.4 %

5.4 %

5.5 %  
4.6 %
  4.8 %

5.4 %


* Numbers may not add due to rounding

** Excludes the impacts of aggregation deal expirations

 

Genie Renewables (GREW)

GREW's second quarter revenue increased  6.6% to $4.0 million from $3.7 million last year, driven by 53.3% growth at Diversegy, and a $0.4 million contribution from Genie Solar's operating portfolio.


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

 

Pipeline   Total   Operational Site Control   Permitting   Construction
MW   85 10 55 10 10
Project Count   14 1 9 2 2

Balance Sheet and Cash Flow Highlights

 

As of June 30, 2024, Genie reported cash and cash equivalents, short and long-term restricted cash, and marketable equity securities of $178.3 million.

 

Total assets as of June 30, 2024 were $322.8 million. Liabilities totaled $133.2 million, and working capital (current assets less current liabilities) totaled $132.7 million. 

 

Cash provided by operating activities increased to $17.6 million in 2Q24 from $3.0 million in 2Q23.

 

3


Trended Financial Information*

(in millions except for EPS)**     1Q23     2Q23     3Q23  

4Q23


1Q24
 
2Q24

2022  

2023
Total Revenue     $ 105.3     $ 93.5     $ 125.0  
$ 104.9

$ 119.7
  $ 90.7

$ 316.2  
$ 428.7
   Genie Retail Energy     $ 101.4     $ 89.7     $ 120.3  
$ 98.4

$ 112.5
  $ 86.7

$ 304.6  
$ 409.9
       Electricity     $ 74.5     $ 80.2     $ 114.0  
$ 82.1

$ 89.4
  $ 78.3

$ 241.8  
$ 350.8
       Natural Gas     $ 26.9     $ 9.0     $ 5.0  
$ 15.1

$ 22.4
  $ 8.4

$ 62.1  
$ 56.0
      Others $ 0.0 $ 0.6 $ 1.3
$ 1.2

$ 0.7
$ 0.0

$ 0.7 $ 3.1
   Genie Renewables     $ 3.9     $ 3.7     $ 4.7  
$ 6.5

$ 7.2
  $ 4.0

$ 11.6  
$ 18.8
Gross Margin       31.6 %     40.9 %     32.9 %

32.1 %

28.2 %  
36.8 %
  49.2 %

34.1 %
   Genie Retail Energy       32.1 %     41.8 %     33.9 %

33.0 %

28.6 %  
37.2 %
  50.4 %

35.0 %
   Genie Renewables       19.3 %     19.6 %     5.3 %

17.2 %

22.0 %  
26.8 %
  15.6 %

15.1 %
Income (Loss) from Operations     $ 11.3     $ 15.0     $ 17.9  
$ (34.2 )
$ 9.8
  $ 10.6

$ 78.4  
$ 10.0
Operating Margin       10.7 %     16.1 %     14.3 %

(32.6 )%

8.2 %  
11.6 %
  24.8 %

2.3 %
Net Income (Loss) Attributable to Genie Common Stockholders     $ 14.3     $ 15.0     $ 14.5  
$ (24.5 )
$ 8.1
  $ 9.6

$ 85.9  
$ 19.2
Diluted Earnings (Loss) Per Share     $ 0.54     $ 0.57     $ 0.53  
$ (0.90 )
$ 0.30
  $ 0.36

$ 3.26  
$ 0.74
Adjusted EBITDA     $ 12.4     $ 15.8     $ 18.5  
$ 11.4

$ 11.7
  $ 12.0

$ 83.2  
$ 58.2


* Some Genie Retail Energy International (GREI) operations have been classified as a discontinued operation and their results excluded from current and historical results
** Numbers may not add due to rounding


2024 Commentary

Stein continued: “Our solid performance in the first half of 2024 puts us on track to achieve our new, consolidated Adjusted EBITDA baseline of $40 - $50 million annually, representing a meaningful increase from the $25 - $30 million range we were targeting just a few years ago. 

"In our solar portfolio, we expect to continue to build out our two New York community solar projects for the rest of the year. We have also advanced two projects, comprising 10MW of potential production, to the permitting stage and are identifying new opportunities to expand our pipeline. Also within GREW, we expect that Diversegy will report another year of strong double-digit growth."

4


Earnings Announcement and Supplemental Information


At 8:30 AM Eastern this morning, Genie Energy’s management will host a conference call to discuss the Company's financial and operational results, business outlook, and strategy. The call will begin with management’s remarks, followed by Q&A with investors.

 

To participate in the conference call, dial 1-877-545-0523 (toll-free from the US) or 1-973-528-0016 (international) and provide the following participant access code: 312566.

 

Approximately three hours after the call, a call replay will be accessible by dialing 1-877-481-4010 (toll-free from the US) or 1-919-882-2331 (international) and providing the replay passcode: 50905. The replay will remain available through Tuesday, August 20, 2024. In addition, a recording of the call will be available for playback on the “Investors” section of the Genie Energy website.

 

About Genie Energy Ltd.

 

Genie Energy Ltd., (NYSE: GNE) is a leading retail energy and renewable energy solutions provider. The Genie Retail Energy division (GRE) supplies electricity, including electricity from renewable resources, and natural gas to residential and small business customers in the United States. The Genie Renewables division (GREW) is a vertically-integrated provider of community and utility-scale solar energy solutions. For more information, visit Genie.com.

 

In this press release, all statements that are not purely about historical facts, including, but not limited to, those in which we use the words "believe," "anticipate," "expect," "plan," "intend," "estimate, "target" and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors, including, but not limited to, those described in our most recent report on SEC Form 10-K (under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations"), which may be revised or supplemented in subsequent reports on SEC Forms 10-Q and 8-K. We are under no obligation, and expressly disclaim any obligation, to update the forward-looking statements in this press release, whether as a result of new information, future events or otherwise.

 

Contact

 

Brian Siegel IRC, MBA

Senior Managing Director

Hayden IR

(346) 396-8696

brian@haydenir.com

 

5


GENIE ENERGY LTD.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)

 

    June 30,
2024
    December 31,
2023
 







Assets             
Current assets:            
Cash and cash equivalents   $ 122,342     $ 107,609  
Restricted cash—short-term     9,178       10,442  
Marketable equity securities     344       396  
Trade accounts receivable, net of allowance for doubtful accounts of $7,349 and $6,574 at June 30, 2024 and December 31, 2023, respectively     54,228       61,909  
Inventory      5,637       14,598  
Prepaid expenses     11,743       16,222  
Other current assets     5,576       5,475  
Current assets of discontinued operations     7,080       13,182  
Total current assets     216,128       229,833  
Restricted cash—long-term

46,400


44,945
Property and equipment, net     20,234       15,192  
Goodwill     12,658       9,998  
Other intangibles, net     2,551       2,735  
Deferred income tax assets, net     5,209       5,200  
Other assets     15,308       15,247  
Noncurrent assets of discontinued operations     4,295       7,405  
Total assets   $ 322,783     $ 330,555  
Liabilities and equity                
Current liabilities:                
Trade accounts payable     26,585       27,881  
Accrued expenses     36,288       49,389  
Income taxes payable     9,062       6,699  
Due to IDT Corporation, net     150       145  
Other current liabilities     6,505       9,280  
Current liabilities of discontinued operations     4,790       4,858  
Total current liabilities     83,380       98,252  
Noncurrent captive insurance liability

46,400


44,945
Other liabilities     2,771       2,212  
Noncurrent liabilities of discontinued operations     678       638  
Total liabilities     133,229       146,047  
Commitments and contingencies            
Equity:                
Genie Energy Ltd. stockholders’ equity:                
Preferred stock, $0.01 par value; authorized shares - 10,000:                
Series 2012-A, designated shares - 8,750; at liquidation preference, consisting of 0 shares issued and outstanding at June 30, 2024 and  December 31, 2023            
Class A common stock, $0.01 par value; authorized shares - 35,000; 1,574 shares issued and outstanding at June 30, 2024 and December 31, 2023     16       16  
Class B common stock, $0.01 par value; authorized shares - 200,000; 28,906 and 28,764 shares issued and 25,438 and 25,820 shares outstanding at June 30, 2024 and December 31, 2023, respectively     289       288  
Additional paid-in capital     158,007       156,101  
Treasury stock, at cost, consisting of 3,468 and 2,944 shares of Class B common stock at June 30, 2024 and December 31, 2023     (31,849 )     (22,661 )
Accumulated other comprehensive income     1,836     3,299  
Retained earnings     73,779       60,196  
Total Genie Energy Ltd. stockholders’ equity     202,078       197,239  
Noncontrolling interests     (12,524 )     (12,731 )
Total equity     189,554       184,508  
Total liabilities and equity   $ 322,783     $ 330,555  
6


GENIE ENERGY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

    Three Months Ended June 30,  
Six Months Ended June 30,

    2024     2023  
2024


2023

    (in thousands, except per share data)

Revenues:            







Electricity   $ 78,301     $ 80,199  
$ 167,697

$ 154,686
Natural gas     8,414       8,975  
30,812


35,900
Other     3,981       4,289  
11,875


8,153
Total revenues     90,696       93,463  
210,384


198,739
Cost of revenues     57,360       55,255  
143,262


127,245
Gross profit     33,336       38,208  
67,122


71,494
Operating expenses:                





Selling, general and administrative (i)     22,015       23,173  
44,916


45,184
Provision for captive insurance liability

640




1,676



Impairment of assets

118





118



Income from operations     10,563       15,035  
20,412


26,310
Interest income     1,362       1,008  
2,702


1,982
Interest expense     (331 )     (30 )
(363 )

(49 )
Gain on marketable equity securities and investments     110       122
227


51
Other income, net     1,262       (104 )
1,342


3,142
Income before income taxes     12,966       16,031  
24,320


31,436
Provision for income taxes     (3,465 )     (3,865 )
(6,385 )

(7,933 )
Net income from continuing operations     9,501       12,166  
17,935


23,503
(Loss) income from discontinued operations, net of taxes     (145 )     3,173  
(410 )

6,227
Net income     9,356       15,339  
17,525


29,730
Net (loss) income attributable to noncontrolling interests, net     (256 )     183
(210 )

144
Net income attributable to Genie Energy Ltd.     9,612       15,156  
17,735


29,586
Dividends on preferred stock         (176 )



(333 )
Net income attributable to Genie Energy Ltd. common stockholders   $ 9,612     $ 14,980  
$ 17,735

$ 29,253
                 





Net income (loss) attributable to Genie Energy Ltd. common stockholders                





Continuing operations   $ 9,757     $ 11,807  
$ 18,145

$ 23,025
Discontinued operations     (145 )     3,173  
(411 )

6,228
Net income attributable to Genie Energy Ltd. common stockholders   $ 9,612     $ 14,980  
$ 17,734

$ 29,253
                 





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





Basic:                





Continuing operations   $ 0.37     $ 0.46  
$ 0.68

$ 0.90
Discontinued operations     (0.01 )     0.12  
(0.02 )

0.24
Earnings per share attributable to Genie Energy Ltd. common stockholders   $ 0.36     $ 0.58  
$ 0.66

$ 1.15
Diluted                





Continuing operations   $ 0.37     $ 0.45  
$ 0.67

$ 0.88
Discontinued operations     (0.01 )     0.12  
(0.02 )

0.24
Earnings per share attributable to Genie Energy Ltd. common stockholders   $ 0.36     $ 0.57  
$ 0.65

$ 1.12
                 





Weighted-average number of shares used in calculation of earnings per share:                





Basic     26,569       25,708  
26,760


25,516
Diluted     27,033       26,321  
27,272


26,073
                 





Dividends declared per common share    $ 0.075     $ 0.075  
$ 0.150

$ 0.150
(i) Stock-based compensation included in selling, general and administrative expenses   $ 458     $ 756  
$ 1,207

$ 1,605
7


GENIE ENERGY LTD. 

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) 

    Six Months Ended June 30,  
    2024     2023  
    (in thousands)  
Operating activities            
Net income   $ 17,525     $ 29,730  
Net (loss) income from discontinued operations, net of tax     (410 )     6,227  
Net income from continuing operations     17,935       23,503  
Adjustments to reconcile net income to net cash provided by operating activities:                
Provision for captive insurance liability

1,676



Depreciation and amortization     415       191  
Impairment of assets
    118       19  
Provision for doubtful accounts receivable

1,210

1,372
Inventory valuation allowance

417



Unrealized gain on marketable equity securities and investment and others, net

(443 )

(162 )
Stock-based compensation

1,207


1,648
Changes in assets and liabilities:                
Trade accounts receivable     6,565     (4,468 )
Inventory     6,616     (2,472 )
Prepaid expenses     4,479     (1,971 )
Other current assets and other assets     1,919       941
Trade accounts payable, accrued expenses and other liabilities     (18,156 )     (2,430 )
Due to IDT Corporation, net     4     (21 )
Income taxes payable     2,362     (11,581 )
Net cash provided by operating activities of continuing operations     26,324       4,569  
Net cash provided by operating activities of discontinued operations     7,011       15,671  
Net cash provided by operating activities     33,335       20,240  
Investing activities                
Capital expenditures     (1,562 )     (561 )
Purchase of solar system facility

(1,344 )


Purchases of marketable equity securities and other investment

(3,042 )

(9,312 )
Purchase of equity of subsidiary

(1,200 )


Proceeds from the sale of marketable equity securities and other investments




8,009
Proceeds from settlement of equity method investment           282
Repayment of notes receivable           19  
Net cash used in investing activities     (7,148 )     (1,563 )
Financing activities                
Dividends paid     (4,152 )     (4,763 )
Repurchases of Class B common stock

(5,897 )


Repurchases of Class B common stock from employees     (1,508 )     (1,475 )
Repurchase of Class B common stock from Genie Foundation

(768 )


Proceeds from the exercise of warrants




5,000
Redemption of preferred stock         (8,359 )
Net cash used in financing activities     (12,325 )     (9,597 )
Effect of exchange rate changes on cash, cash equivalents, and restricted cash     (140 )     (37 )
Net increase in cash, cash equivalents, and restricted cash     13,722     9,043
Cash, cash equivalents, and restricted cash (excluding cash held at discontinued operations) at beginning of period     165,479       106,080  
Cash, cash equivalents and restricted cash (including cash held at discontinued operations) at end of the period     179,201       115,123  
Less: Cash held at of discontinued operations at end of period     1,281     465
Cash, cash equivalents, and restricted cash (excluding cash held at discontinued operations) at end of period   $ 177,920     $ 114,658  
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Reconciliation of Non-GAAP Financial Measures for the Second Quarter of 2024


In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States of America (GAAP), Genie Energy disclosed Adjusted EBITDA on a consolidated basis and for GRE and disclosed Non-GAAP Net Income Attributable to Genie Energy Ltd. Common Stockholders (Non-GAAP Net Income and Non-GAAP earnings per share (Non-GAAP EPS). Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS are non-GAAP financial measures.

 

Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.

 

Genie’s measure of consolidated Adjusted EBITDA starts with income from operations and adds back depreciation, amortization, and stock-based compensation and deducts impairment of assets and equity in the net loss of equity method investees, net.


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

 

Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS should be considered in addition to, not as a substitute for, or superior to, revenue, gross profit, income from operations, cash flow from operating activities, net income, basic and diluted earnings per share or other measures of liquidity and financial performance prepared in accordance with GAAP. In addition, Genie’s measurement of Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS may not be comparable to similarly titled measures reported by other companies.

 

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

 

Management also uses Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS to evaluate operating performance in relation to Genie’s competitors. Disclosure of these non-GAAP financial measures may be useful to investors in evaluating performance and allows for greater transparency to the underlying supplemental information used by management in its financial and operational decision-making. In addition, Genie Energy has historically reported Adjusted EBITDA and believes it is commonly used by readers of financial information in assessing performance. Therefore, the inclusion of comparative numbers provides consistency in financial reporting at this time.

 

Management refers to Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP EPS as well as the GAAP measures revenue, gross profit, and income from operations, as well as net income, on a consolidated level to facilitate internal and external comparisons to Genie's historical operating results, in making operating decisions, for budget and planning purposes, and to form the basis upon which management is compensated.

 

Although depreciation and amortization are considered operating costs under GAAP, they primarily represent the non-cash current period allocation of costs associated with long-lived assets acquired or constructed in prior periods. Genie’s operating results exclusive of depreciation and amortization are therefore useful indicators of its current performance.

 

Stock-based compensation recognized by Genie Energy and other companies may not be comparable because of the various valuation methodologies, subjective assumptions and the variety of types of awards that are permitted under GAAP. Stock-based compensation is excluded from Genie’s calculation of Adjusted EBITDA because management believes this allows investors to make more meaningful comparisons of the operating results of Genie’s core business with the results of other companies. However, stock-based compensation will continue to be a significant expense for Genie Energy for the foreseeable future and an important part of employees’ compensation that impacts their performance. 


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Impairment of assets is a component of income (loss) from operations that is excluded from the calculation of Adjusted EBITDA. The impairment of assets is primarily dictated by events and circumstances outside the control of management that trigger an impairment analysis. While there may be similar charges in other periods, the nature and magnitude of these charges can fluctuate markedly and do not reflect the performance of Genie's continuing operations. 


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

 

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

 

Non-GAAP Reconciliation - Consolidated Adjusted EBITDA

 

(in millions)    1Q23     2Q23     3Q23     4Q23     1Q24     2Q24     2022  
2023
Income (loss) from Operations   $ 11.3     $ 15.0     $ 17.9     $ (34.2)     $ 9.8     $ 10.6     $ 78.4  
$ 10.0
Add back                                                        



Captive insurance liability
$ 0.0

$ 0.0

$ 0.0

$ 45.1

$ 1.0

$ 0.6

$ 0.0

$ 45.1
Depreciation and Amortization   $ 0.1     $ 0.1     $ 0.1     $ 0.2     $ 0.2     $ 0.2     $ 0.4  
$ 0.5
Non-Cash Compensation   $ 0.8     $ 0.8     $ 0.6     $ 0.5     $ 0.7     $ 0.5     $ 2.9  
$ 2.7
Impairment   $ 0.0     $ 0.0     $ 0.0     $ 0.0     $ 0.0     $ 0.1     $ 2.1  
$ 0.0
Equity in net loss (income) of equity method investees   $ 0.2     $ (0.1 )   $ (0.1 )   $ (0.1 )   $ (0.1 )   $ 0.0   $ 0.0
$ (0.1 )
Adjusted EBITDA   $ 12.4     $ 15.8     $ 18.5   $ 11.5   $ 11.7     $ 12.0   $ 83.8  
$ 58.2

 

Non-GAAP Reconciliation - GRE Adjusted EBITDA    

 

(in millions)   2Q24   2Q23
Income from Operations   $ 14.6     $ 18.4  
Add back                
Depreciation and Amortization   $ 0.0     $ 0.1  
Stock-based Compensation   $ 0.3     $ 0.3  
Impairment
$ 0.0

$ 0.0
Equity in the income of equity method investee
$ 0.0

$ 0.0
Adjusted EBITDA   $ 14.9     $ 18.8  


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


(in millions except for EPS)   2Q24   2Q23
Net income attributable to Genie Energy Ltd. Common Stockholders   $ 9.6   $ 15.0  
Add back                
Captive insurance liability
$ 0.6

$ 0.0
Income tax effect of adjustment
$ (0.2 )

0.0
Non-GAAP net income attributable to Genie Energy Ltd. Common Stockholders   $ 10.1     $ 15.0  









Diluted earnings per share
$ 0.36
$ 0.57
Total adjustments
$ 0.02

$ 0.00
Non-GAAP diluted earnings per share
$ 0.37

$ 0.57









Weighted average number of shares used in the calculation of diluted earnings per share

27.0


26.1

 

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