Genie Retail Energy Grows Customer Book By Nearly 100,000 RCEs (Net) In Three Months, Approaches Record Count

May 8, 2023

Email This Story
Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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

Genie Retail Energy (GRE) grew its customer book by a net of about 92,000 RCEs during the three months ended March 31, 2023 (Q1), the supplier's parent, Genie Energy, Ltd., said in reporting earnings today

"GRE accelerated customer acquisition during the quarter as market volatility subsided and customers were highly receptive to targeted marketing initiatives," Genie said

"Genie Retail Energy (GRE) was well-positioned to benefit from the reduction in energy market price volatility this quarter and, in combination with our vigorous and cost-efficient marketing activities, achieved significant year-over-year RCE growth of 36%," Genie said

GRE RCEs as of the first quarter of 2023 were 353,000, up from 262,000 RCEs in 4Q22 and 260,000 RCEs a year ago

As of March 31, 2023, GRE was serving 349,000 meters, up from 275,000 meters as of December 31, 2022 and 286,000 meters a year ago

GRE gross meter additions during the first quarter of 2023 were 129,000, versus 47,000 during 4Q22.

GRE said that, with this increase in a single quarter, GRE was able to climb to within 3,000 RCEs of its highest domestic RCE count in the company’s history

Genie said that GRE accomplished the customer growth without increasing acquisition expense by aggressively pursuing lower cost marketing channels

GRE average monthly churn decreased to 4.4% sequentially from 5.5% in the fourth quarter of 2022. The churn data excludes expiration of low margin aggregation deals

GRE expects to continue organic customer additions during Q2, although likely at a slower pace than recorded during Q1

"Looking to the second quarter, with wholesale energy costs stabilized at lower levels relative to the past year, we continue to see an outstanding arbitrage opportunity versus the incumbent utilities. We will continue to exploit this by adding customers, albeit likely at a lower growth rate than we saw in the first quarter," said Michael Stein, chief executive officer of Genie Energy

"We continue to see attractive opportunities to add to our retail customer base entering the second quarter and expect to generate solid meter growth. Our plan has been to aggressively move into growth mode once market volatility subsided, and these initial results are very encouraging," Stein said

Genie said that GRE posted strong financial results, though off the record-setting results from the year-ago quarter

GRE income from operations and Adjusted EBITDA decreased to $16.4 million and $16.8 million, respectively, during the first quarter of 2023, from $30.2 million and $30.5 million, respectively, in the year-ago quarter

"Last year and with the elevated levels of volatility in the global energy markets, we disclosed that we generated stronger than usual margins at GRE by moderating our customer acquisition engine to reduce consumption. In addition to lowering our customer acquisition spend, this enabled us to monetize a portion of our forward commodity hedges and reduce our effective supply costs, but also had the impact of reducing the size of our customer bucket," said Avi Goldin, Genie CFO

"We said at the time that we’d work to rebuild our customer base when market conditions warranted, and we were ... remarkably successful in the first quarter, adding 92,000 RCEs. We accomplished this without increasing acquisition expense by aggressively pursuing lower cost marketing channels," Goldin said

GRE gross margin was 32.1% during 1Q23, versus 55.5% a year ago

GRE revenue was $101.4 million during 1Q23, versus $83.9 million a year ago

ADVERTISEMENT

ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com:
• NEW! -- Sales Support Specialist -- Retail Supplier
• Channel Sales Manager -- Retail Supplier
• Business Development Manager
• Operations Manager/Director -- Retail Supplier -- Texas

HOME

Copyright 2010-23 Energy Choice Matters.  If you wish to share this story, please email or post the website link; unauthorized copying, retransmission, or republication prohibited.