Genie Energy Q1 2025 Earnings Report

Genie Energy EPS Results

• Actual EPS: $0.42
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Genie Energy Revenue Results

• Actual Revenue: $136.81 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Genie Energy Announcement Details

• Quarter: Q1 2025
• Date: 5/6/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, May 6, 2025
• Conference Call Time: 8:30AM ET

Genie Energy (NYSE:GNE) (NYSE: GNE) is a diversified energy holding company that operates through two primary segments: upstream oil and natural gas exploration and retail energy supply. Its exploration arm, Genie Energy E&P, pursues development of oil shale resources and conventional hydrocarbon deposits, holding licenses for projects in regions such as Israel’s Shefela basin and Jordan’s oil shale formations. The division also explores select opportunities in North America, leveraging technical partnerships to advance resource evaluation and pilot production programs.

Genie Retail Energy provides electricity and natural gas to residential and small commercial customers under regulated and deregulated frameworks. The segment serves markets in several U.S. states—including New York, Texas, Pennsylvania and New Jersey—as well as in the United Kingdom. In addition to commodity supply, Genie Retail Energy offers value-added services such as rooftop solar installations, battery storage solutions and energy efficiency consulting, positioning itself as a one-stop provider for traditional and distributed energy resources.

Formed in 2011 as a spin-off from IDT Corporation, Genie Energy consolidated a portfolio of energy-related ventures to create a standalone, publicly traded entity focused on both conventional and renewable energy markets. The company is headquartered in Newark, New Jersey, and maintains strategic partnerships to support its exploration activities and retail platforms. By balancing upstream resource development with customer-facing energy services, Genie Energy aims to navigate evolving energy demand and regulatory landscapes.

Genie Energy Q1 2025 Earnings Call Transcript

Key Takeaways

• In Q1, consolidated revenue rose 14.3% to $136.8 million and income from operations jumped 30.3%, driving net income per share up from $0.30 to $0.40 year-over-year.
• Retail energy segment added over 48,000 net new meters to reach ~413,000 meters, resulting in an 18% year-over-year increase in revenue and income from operations on stable commodity pricing and churn held at 5.5%.
• The Lansing community solar project is on track for Q3 completion and is expected to be EBITDA-accretive upon commissioning, while the diversity energy brokerage business has turned cash-flow positive.
• Genie returned $3.9 million to shareholders in Q1 via dividends and share repurchases and ended the quarter with $210 million in cash and marketable securities, signaling continued buybacks ahead.
• Utility-scale revenue declined 40% to $4.3 million due to a shift away from commercial solar, and consolidated gross margin dipped 90 basis points amid lower-margin meter acquisitions.

Presentation

[Operator]

Good morning, and welcome to the Genie Energy Limited's first quarter 2025 earnings call. In today's presentation, Genie Energy Management will discuss Genie's financial and operational results for the three-month period ended March 31st, 2025. During prepared remarks by Genie Energy's Chief Executive Officer Michael Stein and Chief Financial Officer Avi Goldin, all participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After Avi Goldin's remarks, Michael and Avi will take questions from investors. Any forward-looking statements made during this conference call, either in the prepared remarks or in the Q&A 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.

[Operator]

These risks and uncertainties include, but are not limited to, specific risks and uncertainties discussed in the reports that Genie Energy files periodically with the SEC. Genie Energy assumes no obligation either to update any forward-looking statements that they have made or may make, or to update the factors that may cause actual results to differ materially from those that they forecast. In their presentation or in the Q&A session, Genie Energy's management may make reference to non-GAAP measures, including adjusted EBITDA, non-GAAP net income, and non-GAAP earnings per share. The schedule provided in the Genie Energy earnings release reconciles adjusted EBITDA, non-GAAP net income, and non-GAAP earnings per share to the nearest corresponding GAAP measures. Please note that Genie Energy earnings release is available on the investor relations page of the Genie website. The earnings release has also been filed on Form 8-K with the SEC.

[Operator]

I will now turn the conference over to Michael Stein.

[Michael Stein, CEO at Genie Energy]

Thank you, Operator. Our first quarter featured strong operational and financial results highlighted by robust increases in revenue, profitability, and cash generation compared to the year-ago quarter. This quarter is the first quarter we have had in several years where the year-over-year comparative results for our retail energy business reflect what we consider to be normalized results in both periods. In 2022, and to a lesser extent in 2023, our retail energy business was able to achieve exceptional margins by optimizing our commodity market positions during relatively volatile energy markets. As a result, year-over-year growth rates, while strong, were disadvantaged during much of 2023 and 2024. For Q1 2025, GRE is back at a reasonable year-over-year comparative baseline, with margins in what we believe to be a sustainable range for both quarters.

[Michael Stein, CEO at Genie Energy]

At GRE, the significant investments we made in 2024 to expand our customer base drove a year-over-year increase of over 48,000 net new meters. We ended the quarter with approximately 413,000 meters served, comprising 402,000 RCEs. The meter increase, in combination with a stable commodity pricing environment, enabled GRE to increase both revenue and income from operations by 18% compared to the year-ago quarter. Our meter growth reflects deep penetration of our existing markets, supplemented by expansion to new states. As I mentioned last quarter, we recently began to market in California, and we expect to begin offering gas in Kentucky in the second quarter. Customer churn in the first quarter was 5.5%, unchanged from the year-ago quarter and just a 10 basis point increase from the fourth quarter last year. I credit our comprehensive customer retention program for maintaining churn at these levels.

[Michael Stein, CEO at Genie Energy]

Without that focused effort, the strong growth in our customer base over the last year would likely have pressured churn upward. At GREW, we continue to advance our pipeline of utility-scale development projects. The most mature project in our development pipeline, a community solar project in Lansing, New York, is on track for completion as early as the third quarter of this year. We expect it will become EBITDA creative immediately once online. Once completed, the Lansing project will join our operational portfolio, which continues to perform in line with our expectations. Also, within GREW, our diverse energy brokerage business continues to perform very well. A year ago, this business was EBITDA negative, and it is now generating positive cash flow and is on track to become an increasingly important contributor to our bottom-line results.

[Michael Stein, CEO at Genie Energy]

Before turning the call over to Avi, I want to point out that Genie returned $3.9 million to our stockholders during the first quarter through our quarterly dividend and share repurchases. At March 31st, we had $210 million in cash, restricted cash, and marketable securities compared to $201 million at the end of 2024. With our strong balance sheet, robust cash flows, and with the stock at its current levels, we expect to continue to repurchase our shares in the coming quarters. Now, here is Avi.

[Avi Goldin, CFO at Genie Energy]

Thank you, Michael, and thanks to everyone on the call for joining us this morning. My remarks today cover our financial results for the three months ending March 31st, 2025. In my commentary on the quarterly results, I will compare the results for the first quarter 2025 to the first quarter 2024 to remove from consideration the seasonal factors that impact our results, particularly within our retail energy business. The first quarter is typically characterized by relatively elevated levels of electricity and gas consumption, as it includes the majority of the winter's peak heating season within our service areas. Our results were quite good, highlighted by strong top-line growth and significantly improved bottom-line performance. Consolidated revenue in the quarter increased 14.3%, or $17.1 million, to $136.8 million, driven by strong performance in Genie Retail Energy. At GRE, revenue jumped 17.8% to $132.5 million.

[Avi Goldin, CFO at Genie Energy]

As Michael pointed out, the increase is primarily a function of the investments that we made through our customer base last year, boosted by increased per-meter consumption of both electricity and natural gas during the quarter. Electricity revenue climbed 16.4% to $104.1 million, contributing 78.6% of GRE's revenues. Kilowatt-hours sold increased 23.5%. The impact of that increase in consumption was partially offset by a 5.7% decrease in the average revenue per kilowatt-hour sold. Revenue from the sale of natural gas increased 26.8% in the first quarter to $28.4 million, reflecting increases in both therms sold and revenues per therm sold. At GREW, first-quarter revenue decreased 40% to $4.3 million. The revenue decline was largely driven by Genie Solar and reflects the impact of our decision to pivot from the commercial project market. At GREW, Diversegy achieved another record quarter, contributing $3.8 million in revenue, a 55% year-over-year increase.

[Avi Goldin, CFO at Genie Energy]

Consolidated gross profit increased 10.6% to $37.4 million, while gross margin decreased 90 basis points to 27.3%. The increase in gross profit was driven by the expansion of GRE's customer base, while the decrease in gross margin was driven by lower margins on electricity sales, specifically the acquisition of profitable or lower-margin meters through our municipal aggregation deal program. Consolidated SG&A increased 4.3%, or $1 million, to $23.9 million, primarily reflecting increased expenses at GRE. GRE's strong quarter drove a 30.3% year-over-year increase in consolidated income from operations to $12.8 million and a 22.7% increase in adjusted EBITDA to $14.4 million. At GRE, income from operations increased 18.2% to $16.8 million, and adjusted EBITDA increased 17.1% to $17.1 million, reflecting our expanded gross profit partially offset by increased SG&A expenses. At GREW, the first quarter's loss from operations increased to $900,000 from $600,000 in the year-ago quarter.

[Avi Goldin, CFO at Genie Energy]

The increase in losses primarily reflects our investment in building out our solar generation project development pipeline, partially offset by the stronger performance of Diversegy, which was adjusted EBITDA negative in the year-ago quarter, which generated over $400,000 in adjusted EBITDA in the first quarter of this year. Consolidated net income attributed to Genie common stockholders increased $10.6 million, or $0.40 per share, from $8.1 million, or $0.30 per share a year earlier. Turning now to the balance sheet, on March 31st, 2025, cash equivalents, roaming short-term restricted cash, which includes the cash held by our Captive Insurance subsidiary and marketable equity securities, totaled $210.2 million, an increase of $9.2 million in the quarter. Working capital was $121.2 million. Our net, current, and non-current debt totaled $9 million, the largest component of which is financing for our portfolio of operational arrays that we completed last quarter.

[Avi Goldin, CFO at Genie Energy]

We repurchased approximately 127,000 shares of our Class D Common Stock in the first quarter for $1.9 million and paid our regular equity dividend to return $2 million directly to our stockholders. To wrap up, this was a solid quarter with strong operational and financial results at GRE. Looking ahead, both GRE and GREW are well positioned for the remainder of the year, and we are confirming our full-year adjusted EBITDA guidance of $40 million-$50 million. Operator, now back to you for Q&A.

[Operator]

Thank you. We will now begin our question-and-answer session. To ask a question, you may press star, then one on your touch-tone phone. If you're using a speakerphone, please pick up the handset before pressing the keys. To withdraw your question, press star, then two. We will now pause momentarily to assemble our roster. Once again, ladies and gentlemen, if you do have any questions or comments, please indicate so now by pressing the star key followed by one. Okay. As there are no questions in the queue at this time, this will conclude our question-and-answer session and conference call. Thank you for attending today's presentation. You may now disconnect.

Participants

Executives

• Avi Goldin, CFO
• Michael Stein, CEO