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Genie Energy Reports Negative Impact From Texas Winter Weather Event, Q1 Results

May 6, 2021

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Copyright 2010-21
Reporting by Paul Ring •

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In reporting first quarter 2021 earnings, Genie Energy Ltd. reported a negative impact of approximately $13.0 million from the winter weather event in Texas

"As we discussed when we reported last quarter's earnings, the first quarter was impacted by unusually severe weather events that led to massive spikes in wholesale electricity prices in Texas and Japan. The winter storms in Texas and Japan had an aggregate negative impact on income from operations of approximately $15.5 million. In Texas, where the negative impact of the storm this quarter was approximately $13.0 million, our industry has borne a disproportionate share of the financial burden. We remain hopeful that prospective legislation, regulatory changes and/or litigation will provide material relief," said Genie CEO Michael Stein

"Genie Energy achieved record first quarter revenue. Our meter and RCE counts continued to climb, and absent the Texas storm's impact, our domestic business would likely have achieved record income from operations and Adjusted EBITDA*. Additionally, Genie Renewables, formerly Genie Energy Services, continued to expand into higher margin solar solutions offerings and delivered its highest level of income from operations to date," Stein said

Genie Retail Energy

In the Genie Retail Energy (GRE) segment, meters served as of March 31, 2021 were 373,000, versus 370,000 as of December 21, 2020, and 384,000 a year ago.

On an RCE basis, GRE customer base at March 31, 2021 was 347,000 RCEs, up from 337,000 as of December 31, 2020 and 330,000 RCEs a year earlier.

"The changes resulted from Genie's focus on meter acquisition opportunities in geographies with higher average consumption per meter and from higher per meter consumption in the past year due to COVID-related factors," Genie said

GRE gross meters added during 1Q21 totaled 62,000 compared to 58,000 in 4Q20 and 69,000 in 1Q20. The year over year decrease largely reflected the impact of COVID-related public health restrictions compared to the year ago quarter. The sequential increase was enabled by the relaxation of those restrictions in some jurisdictions and by the closing of an aggregation deal in 1Q21.

GRE average monthly churn decreased to 4.9% in the quarter, from 5.3% in 4Q20 (compares to 4.7% in 1Q20). Churn in the 4th quarter of 2020 was impacted by the expiration of an aggregation deal.

GRE Adjusted EBITDA was $1.5 million for 1Q21, down from $13.3 million a year ago. "Excluding the direct impact of the Texas weather event, but without adjustments for other market conditions, GRE's Adjusted EBITDA would have been approximately $14.5 million, a record quarter for the business," Genie said

GRE gross profit was $15.0 million in 1Q21, versus $27.6 million a year ago

GRE Revenue was $90.7 million in 1Q21, versus $79.1 million a year ago

Other Segments & Consolidated Data

Genie Renewables (formerly Genie Energy Services) comprises Genie Solar, a provider of end-to-end customized solar solutions primarily for commercial customers, Diversegy, a commercial energy consulting business, CityCom Solar, a provider of community solar energy solutions and Genie's interest in Prism Solar, a supplier of solar panels and solutions

Genie Renewables income from operations increased to $0.6 million compared to $0.3 million in 1Q20.

GRE International loss from operations increased to $6.7 million from $2.5 million in 1Q20 primarily impacted by a severe weather induced spike in wholesale electricity rates which increased Genie Japan's supply cost by approximately $2.5 million.

On a consolidated basis, Genie Adjusted EBITDA was $(4.5) for the first quarter of 2021, versus $10.3 million a year ago

On a consolidated basis, Genie was serving 572,000 meters as of March 31, 2021, versus 565,000 as of December 31, 2020 and 532,000 a year ago

On a consolidated basis, Genie was serving 450,000 RCEs as of March 31, 2021, versus 440,000 as of December 31, 2020 and 401,000 a year ago

GRE International's customer base at March 31, 2021 increased to 103,000 RCEs from 72,000 RCEs and to 199,000 meters from 148,000 meters a year earlier led by growth in Scandinavia and the U.K.

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