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Genie Retail Energy Reports Higher Customer Growth

August 4, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

Genie Retail Energy (GRE) reported higher customer growth during the three months ended June 30, 2017 (2Q 2017), compared with the growth seen in the three months ended March 31, 2017.

From March 31, 2017 to June 30, 2017, Genie Retail Energy saw its number of meters increase by 12,000. This compares to net growth of 6,000 meters from December 31, 2016 to March 31, 2017

Total meters were 430,000 as of June 30, 2017, versus 418,000 as of March 31, 2017 and 390,000 a year ago.

Genie Retail Energy meters as of June 30, 2017 were 317,000 electricity meters and 113,000 natural gas meters

On an RCE basis, Genie Retail Energy was serving 289,000 RCEs as of June 30, 2017, versus 287,000 as of March 31, 2017 and 239,000 a year ago

Gross meter acquisitions in 2Q17 increased to 98,000 from 58,000 in the year-ago quarter. Meters enrolled in offerings with fixed rate characteristics constituted approximately 29% of GRE’s electric load during June 2017 compared to 15% of GRE’s electric load during June 2016.

Genie reported that the bulk of its net organic customer growth was seen in the new states and territories that Genie entered through its previously reported acquisition of Town Square Energy last year

Genie also reported that it recently began to pursue opportunities in certain commercial markets

GRE’s average monthly customer churn increased to 6.3% in 2Q17 from 5.8% in the year ago quarter, and from 6.1% in 1Q17. The increase reflects the higher rate of gross customer additions in recent quarters as well as the expiration of an aggregation deal in Illinois.

GRE’s loss from operations was $8.2 million in 2Q17 compared to income from operations of $5.2 million in the year ago quarter reflecting a $9.0 million legal accrual and the increased levels of customer acquisition activity, as well as a decrease in gross profit. GRE accrued $9.0 million related to an agreement to settle class action lawsuits stemming from the polar vortex of 2013-2014 (see story here).

Adjusted EBITDA was negative $7.6 million in 2Q17 compared to Adjusted EBITDA of $5.3 million in 2Q16.

GRE’s gross profit in 2Q17 was $13.4 million compared to $18.1 million in 2Q16 reflecting the narrowing of margins on sales of both electricity and natural gas and a decline in therms sold and the revenue reduction of $3.6 million for estimated payments related to the expected legal settlement described above, partially offset by an increase in kWh sold

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