The following is a summary of the Genie Energy Ltd. (GNE) Q3 2024 Earnings Call Transcript:
Financial Performance:
Genie Energy reported a strong financial performance in Q3 with $14 million in adjusted EBITDA and a total of $37 million in adjusted EBITDA for the first nine months of 2024.
Total Q3 revenue was $111.9 million, although there was a decrease of 10.5% due to lower kilowatt hours sold, primarily from GRE impacting revenue with a decrease of 12.1% to $105.8 million.
Consolidated gross profit was $37.9 million with a gross margin improvement to 33.9%.GRE's gross margin slightly decreased by 10 basis points to 33.8%, while GREW's gross profit jumped considerably due to high margin revenues.
Business Progress:
Genie Energy expanded its operational footprint by entering the California natural gas market, targeting residential customers, expected to start serving in Q4.
The GRE division reported approximately 36,000 net new meters, growing to 399,000 meters served, a 3.5% increase.
Genie Energy's renewable energy segment, GREW, is repositioning to focus on utility-scale projects, moving away from commercial and industrial, which doubled revenue compared to the previous year.
Opportunities:
Expanded into California, now serving electricity and/or natural gas in 19 states plus Washington, D.C., which diversifies portfolio and mitigates regional energy market volatility.
Continued focus and growth in utility-scale solar projects enhances efficiency and profit generation with significant contributions expected from operational arrays.
Risks:
Market volatility affecting kilowatt-hour sales led to a revenue decline in GRE's segment.
Higher SG&A expenses due to aggressive customer acquisition, despite decreasing consumption, reflecting increased operational costs.
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