Just Energy CEO Discusses View On M&A, Targets

During an earnings call, Just Energy CEO Pat McCullough discussed the company's view on M&A opportunities.

"[W]e're always keeping our eye on the market. I think we've said publicly a few times that buying commodity books would be interesting to us if volatility returned in a significant way and if multiples on let's say commodity books drop below 3x. That's happened in the past with events like polar vortex. And that's where we would be keen on acquiring books, provided they were healthy books," McCullough said

"Outside of that, you probably won't see us buying any commodity books at today's 5+x EV to EBITDA. If you observe what we've been doing in the last two years, buying small bolt-on capabilities in the value-added product and services arena with well-structured deals that really limit the amount of cash that we put upfront. That will remain our strategy," McCullough said

McCullough said that the company needs to "digest" and "scale" its recent acquisition of Filter Group Inc., a provider of subscription based, home water filtration systems to residential customers in Canada and the United States

"So we're really going to be focused on what we have right now," McCullough said who added that, at least in the short term, to not expect any big inorganic add-on.

"[W]e see so much opportunity on the core commodity book right now that we're really focused on leveraging that," McCullough said