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Genie Energy Suspending Dividend Due To Impact From Texas Weather Event

Undertaking Strategic Evaluation Of Its International Investment Businesses

Reports Record Full-Year Adjusted EBITDA From U.S. Retail Energy Supply Business

March 11, 2021

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Copyright 2010-21
Reporting by Paul Ring •

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Genie Energy Ltd. announced that it has suspended its dividend as part of an effort to rebuild its cash position in the aftermath of the Texas weather event

"Because complete data on supply and related costs is not available, Genie Energy is not yet able to fully quantify the financial impact of the storm. Invoices received to date as well as other costs incurred in connection with the disruptive period currently place the first quarter loss in Texas at approximately $12.8 million. The company plans to provide an update when it has received all relevant price and volume settlement data," Genie Energy said

"In light of the losses incurred from the unprecedented storm that hit Texas in mid-February, we are working to de-risk our business and narrow our strategic focus. We expect to grow our cash-generating core business in the U.S., including our solar business, maximize near term cash flows, strengthen our balance sheet, and adapt our risk profile in light of the lessons learned," Genie Energy said

"Pursuant to this approach, we will undertake a strategic evaluation of our international investment businesses," Genie Energy said

"As part of the effort to rebuild our cash position, we have suspended our dividend," Genie Energy said

At Genie Retail Energy (GRE), meters served as of December 31, 2020 were 370,000, versus 375,000 as of September 30, 2020, and flat versus a year-ago.

GRE gross meters added during 4Q20 totaled 58,000 compared to 44,000 in 3Q20 and 56,000 in 4Q19. For the full year 2020, gross meters added totaled 212,000 compared to 308,000 added in 2019.

At GRE, RCEs served as of December 31, 2020 were 337,000, versus 350,000 as of September 30, 2020 and 309,000 a year earlier

Average monthly customer churn was 5.3% in 4Q20 compared to 3.7% in 3Q20 and 6.1% in 4Q19. For the full year 2020, average monthly customer churn decreased to 4.4% from 5.3% in 2019, driven by reduced competitive activity due to COVID-19 during 2020.

For 4Q20, Genie Retail Energy Adjusted EBITDA was $5.2 million, versus $8.5 million a year ago. The year-over-year decrease in Adjusted EBITDA was driven by reduced gross profit per kilowatt hour partially offset by decreased customer acquisition expense as a result of COVID-19 related restrictions on in-person customer acquisition activities.

GRE gross profit was $17.7 million for 4Q20, versus $22.0 million a year ago

GRE revenue was $70.2 million for 4Q20, versus $74.0 million a year ago

For the full year 2020, GRE Adjusted EBITDA was a record $37.3 million, up from $28.3 million a year ago

On a consolidated basis across all of its segments (including international customers), total Genie Energy meters were 565,000 as of Dec. 31, 2020, versus 558,000 as of Sept. 30, 2020

On a consolidated basis, Genie Energy Adjusted EBITDA was $0.7 million for 4Q20, versus $0.8 million a year ago

At December 31, 2020, Genie Energy had $187.3 million in total assets. Cash, cash equivalents, restricted cash marketable securities and short-term investments totaled $48.3 million at December 31, 2020 compared to $49.2 million at September 30, 2020. Liabilities totaled $101.3 million and working capital (current assets less current liabilities) totaled $36.3 million compared to $54.9 million at September 30, 2020. The reduction in working capital substantially reflects the consolidation of Orbit Energy in the fourth quarter including prepayments made by its customers.

Cash used in operating activities in 4Q20 was $0.9 million compared to cash provided by operating activities of $0.2 million in 4Q19. Full year 2020 cash provided by operating activities increased to $23.1 million from $15.8 million in 2019

As previously reported, during the fourth quarter, Genie concluded its oil and gas exploration program after finding no light oil in its last well tests. "Though disappointing, the result allows us to focus more tightly on our retail energy supply business," Genie said

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