Genie Energy Ltd. · NYSE:GNE
Genie Energy — Investor Presentation (November 2018)
19 slides from Genie Energy's investor presentation, Nov 7, 2018
Slide 1: Investor Presentation November 2018
Investor Presentation November 2018 Genie Energy Ltd (NYSE: GNE)
Slide 2: Safe Harbor Statement
Safe Harbor Statement 2 This presentation contains forward - looking statements. Statements that are not historical facts are forward - looking statements and such forward - looking statements are statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act
Slide 3: Genie Energy at a glance
Genie Energy Class B Common Stock Symbol NYSE: GNE Stock Price 1 $6.24 Shares Outstanding 2 26.9 million Dividend Yield 1 4.8% Market Capitalization 1 $168 million Genie Energy Series 2012-A Preferred Stock Symbol NYSE: GNEPRA Stock Price 1 $7.70 Shares Outstanding 2.3 million Dividend Yield 1 8.3%
Slide 4: Investment Thesis
Investment Thesis Successfully restructured operations to focus on growth within Retail Energy and Energy Services business es Strategic Transition Legacy oil and gas exploration operations have been sold or reduced Genie Energy is expanding domestic and international operations Strong growth opport
Slide 5: Retail Energy Overview
Genie Retail Energy Overview Genie Retail Energy controls a leading portfolio of retail energy providers (REP) ● Launched in 2004. Now among the largest independent residential REPs ● Operat es in deregulated markets across 13 U.S. states and the D istrict of Columbia ● History of strong financial p
Slide 6: Retail Energy Overview: Value proposition
Genie Retail Energy Overview Value p roposition ● Customers: Power of choice, value added services and potential savings ● Utilities: Removes load - based risk while generating fees from services 6 Managed - risk model ● Many utilities offer purchase of receivables programs – reducing credit risk ●
Slide 7: Meters and RCEs (Domestic) Commentary
7 Commentary ● 2014 : First half Polar Vortex increases churn. Second half stabilization ● 2015 - 2016 : Strong sequential electric meter, RCE growth and new territories ● 2016 : Acquired Town Square Energy in fourth quarter ● 2017 : Organic RCE growth ● 2018: Declines through first three quarters r
Slide 8: Retail Value Chain
Retail Value Chain Customer Acquisition Model Value Creation Long - term, V aluable Customers ● Multiple sales channels across multiple regions ● Diverse product offerings ● Deep data analysis to identify market opportunities and optimize product offerings ● Hedging strategies reduce commodity volat
Slide 9: M&A Highlights
M&A Highlights ● Date: November 2016 ● Price: $9.6 million plus working capital ● Opened four new states to Genie’s customer acquisition engine ● Differentiated customer acquisition model and respected brand have helped to increase Town Square Energy RCEs from 47,000 at purchase to 71,200* *As of Se
Slide 10: Customer Portfolio
Customer Portfolio* 10 * Residential Customer Equivalents (RCEs) a t September 30, 2018
Slide 11: Retail Energy Markets
Genie Retail Energy Markets 11
Slide 12: Retail International
Genie Retail International 12 ● Acquired 65% position in July 2017 ● Full market entry in April 2018 ● Expanding sales and marketing operation s ● Attractive market potential: ● Acquired 100% position in l icensed entity in June 2018 ● Key vendor support agreements in place ● M eter acquisition prog
Slide 13: Retail Energy Services
Genie Retail Energy Services 13 ● Diversegy – Energy brokerage, efficiency consulting and LED installation ● Genie Solar Energy - End to end solar solutions from initial project design though installation ● Prism Solar Technologies - designs and manufactures solar systems in the United States featur
Slide 14: Why Own Genie Energy?
Why Own Genie Energy? 14 Special Situation Investors ● Successful transition to a pure - play retail energy provider model while curtailing oil and gas (O&G) exploration program ● Reduced O&G exploration expense will positively impact Adjusted EBITDA* and cash flows in 2018 - 2019 ● P ublic companie
Slide 15: Energy P&L By Line of Business
Genie Energy P&L By Line of Business 15 Genie Retail and Corporate Overhead (USD in millions) 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 2017 TTM* Revenue $71.4 $50.2 $69.5 $73.1 $89.3 $56.4 $71.7 $264.2 $290.4 Gross profit 24.8 12.1 21.8 26.8 24.5 16.1 21.1 85.5 88.4 SG&A 18.3 24.3 19.0 16.6 16.0 14.3 13.2
Slide 16: Reconciliation of Non-GAAP Financials
Reconciliation of Non - GAAP Financials 16 In addition to including financial results that are determined in accordance with generally accepted accounting principles in the United States of America (GAAP), Genie Energy’s investor presentation included Adjusted EBITDA, which is a non - GAAP financial
Slide 17: Reconciliation of Non-GAAP Financials
Reconciliation of Non - GAAP Financials 17 *TTM – Trailing twelve months ended September 30, 2018 (USD in millions) TTM* Adjusted EBITDA $27.4 Subtract (add): Depreciation and amortization $2.3 Impairment $9.2 Stock-based Compensation $5.1 Income (loss) from operations $10.8 Slide 3 - Reconciling EB
Slide 18: Reconciliation of Non-GAAP Financials
Reconciliation of Non - GAAP Financials 18 *TTM – Trailing twelve months ended September 30, 2018 Slide 15 - Reconciling Adjusted EBITDA to Income from Operations for Genie Retail and Corporate Overhead (USD in millions) 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 2017 TTM* Combined Adjusted EBITDA 8.2$ (10.
Slide 19: Michael Stein, CEO; Avi Goldin, CFO
Michael Stein Chief Executive Officer Avi Goldin Chief Financial Officer