Energy Choice
                            

Matters

Lower Unit Margins Result In Flat Spark Energy Earnings

November 2, 2018

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

The following story is brought free of charge to readers by EC Infosystems, the exclusive EDI provider of EnergyChoiceMatters.com

Spark Energy, Inc. reported Adjusted EBITDA of $18.6 million for the quarter ended September 30, 2018, compared to Adjusted EBITDA of $19.6 million for the quarter ended September 30, 2017

This decrease of $1.0 million was driven by a lower Retail Gross Margin, due to lower gas volumes and lower electricity unit margins

For the quarter ended September 30, 2018, Spark reported Retail Gross Margin of $45.8 million compared to Retail Gross Margin of $50.6 million for the quarter ended September 30, 2017. This decrease of $4.8 million is primarily attributable to lower natural gas volumes and electricity unit margins.

Net income for the quarter ended September 30, 2018, was $18.8 million compared to net income of $12.9 million for the quarter ended September 30, 2017. The increase in performance compared to the prior year was primarily the result of non-cash gains on derivative instruments.

Spark's Total RCE count was 979,000 as of September 30, 2018.

As first reported by EnergyChoiceMatters.com (see story here), Spark also acquired 60,000 residential RCEs from Starion Energy subsequent to the close of fiscal third quarter 2018

"Our third quarter was highlighted by continued improvement in organic customer acquisitions as well as significant strides in realizing the brand and platform consolidations that we expect to lead to stronger margins," said Nathan Kroeker, Spark Energy's President and Chief Executive Officer. "Efforts to improve customer mix and migrate customers to more cost-effective billing platforms are more than halfway complete and our cost saving actions are tracking ahead of our expectations."

Kroeker continued, "Since the closing of our third quarter, we announced our acquisition of up to 60,000 residential RCEs in the Midwest and Mid-Atlantic regions. This acquisition will be immediately accretive to 2018 earnings and will require minimal integration activity."

Kroeker concluded, "As we look to fiscal 2019, we expect to see the benefits of improved customer mix and normalized RCE counts. We expect our Adjusted EBITDA to positively reflect the success of our synergy and cost reduction initiatives. Year-to-date we have implemented significant general and administrative cost savings, and we will continue to evaluate opportunities to improve long-term profitability."

ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com:
• NEW! -- Director of Sales & Marketing -- -- Retail Supplier -- Houston
• NEW! -- Sales Director -- Houston
• NEW! -- Director of Sales
• NEW! -- Energy Sales Representative
• NEW! -- Manager Business Field Sales -- Retail Energy
• NEW! -- Senior Energy Consultant
• NEW! -- Supply Analyst -- Retail Supplier
• NEW! -- Controller -- Retail Supplier -- Houston
• NEW! -- Outside Sales Executive -- Retail Energy
• NEW! -- Channel Sales Manager -- Retail Supplier
• NEW! -- Sr Analyst, Supply and Pricing -- Retail Supplier -- Houston
• NEW! -- Customer Retention Analyst -- Retail Supplier -- Houston
• NEW! -- Energy Market Analyst - Pricing & Trading
• NEW! -- Manager, Power Supply -- Retail Supplier
• NEW! -- Renewable Energy Sales Representative -- Retail Supplier