Says Summer Volatility Provides, "Opportunity To Acquire Customers At Value"
Reports "Phenomenal" Q2 For Retail Business
August 1, 2018 Email This Story Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • firstname.lastname@example.org
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Discussing second quarter earnings this morning, Mauricio Gutierrez, NRG Energy's President and Chief Executive Officer, said that NRG's Retail business had a "phenomenal" quarter, and said that the business is "always" looking to acquire retail books.
Asked by an analyst about NRG's recent acquisitions of several customer books from Texas retail providers, Gutierrez said, "This is just the normal course of business, we're always looking for books that we can add to our retail business, and that's what they were."
Gutierrez said that the recent Texas book purchases were not representative of the type of transaction that NRG recently closed in its purchase of Xoom Energy. On June 1, 2018, NRG closed on the acquisition of retail provider XOOM Energy, LLC for $208 million (includes transaction costs and working capital adjustments of $43 million), representing an incremental $11 million of net income and $45 million of Adjusted EBITDA on an annualized basis. XOOM Energy is an electricity and natural gas provider with over 300,000 customers, primarily in the East region.
NRG said that current summer volatility in ERCOT provides an, "opportunity to acquire customers at value."
NRG said that it has a, "scalable customer acquisition and retention engine," to take advantage of such opportunities
NRG's Retail segment posted second quarter Adjusted EBITDA of $298 million, $94 million higher than the $204 million posted in the second quarter 2017, driven by higher gross margins, capacity obligations, favorable weather, higher customer count and usage and lower operating costs.
NRG reported its Retail recurring mass market customer count as 3.173 million as of 2Q18, up from 2.878 million in 1Q18, largely driven by the Xoom acquisition, but executives also said that the retail business is seeing steady attrition and retention performance
NRG Retail delivered volumes were 16.8 TWh for the second quarter of 2018, up from 15.9 TWh a year ago.