UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT  

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 7, 2020

GENIE ENERGY LTD.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (973) 438-3500

Not Applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Securities registered pursuant to Section 12(b)-2 of the Exchange Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company   ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ☐

Item 2.02. Results of Operations and Financial Condition.  

On May 7, 2020, the Registrant distributed over a wire service and posted an earnings release to the investor relations page of its website (www.genie.com) announcing its results of operations for the quarter ended March 31, 2020. A copy of the earnings release concerning the foregoing results is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

The Registrant is furnishing the information contained in this Report, including Exhibit 99.1, pursuant to Item 2.02 of Form 8-K promulgated by the Securities and Exchange Commission (the “SEC”). This information shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC unless otherwise expressly stated in such filing. In addition, this Report and the press release contain statements intended as “forward-looking statements” that are subject to the cautionary statements about forward-looking statements set forth in the press release.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: May 7, 2020

EXHIBIT INDEX

3

Exhibit 99.1

Genie Energy Ltd. Reports First Quarter 2020 Results

NEWARK, NJ — May 7, 2020: Genie Energy Ltd. (NYSE: GNE, GNEPRA) reported first quarter 2020 net income of $0.20 per diluted share on revenue of $104.1 million.

HIGHLIGHTS

(Throughout this release, 1Q20 results are compared to 1Q19 results unless otherwise noted)

COMMENTS OF MICHAEL STEIN, CEO

“First, I want to acknowledge and thank our colleagues and employees. I’ve been absolutely blown away by the hard work, efficiency and effectiveness of the Genie staff who are excelling every day despite all the distractions and stresses of working from home. Thank you so much. And all of us at Genie salute the first responders, nurses, doctors and law enforcement professionals who are doing amazing work caring for those who are ill. Our thoughts and prayers go out to those who are suffering and their families.

“Genie Energy achieved very strong first quarter results. Robust growth in our global customer base and strong margins helped us attain record levels of revenue and gross profit. Our global customer base surpassed the 400,000-RCE and 500,000-meter milestones, powered by expansion in both our domestic and overseas markets.

“Looking ahead, we anticipate that COVID-19 will have a mixed impact on our business operations and financial results. In the short run, with our predominantly residential book, we expect a positive impact from increased per-meter electricity consumption as our customers spend more time at home. In addition, meter acquisition expense and customer churn are decreasing as the result of the industry-wide suspension of door-to- door meter acquisition. On the other hand, restrictions on in-person sales and marketing will likely slow customer acquisition for the duration of the pandemic and may result in net meter attrition.

“We are working hard to calibrate our operations to address the challenges of the pandemic and have achieved success in the early stages. Our outlook remains positive. With our diversified markets, liquid balance sheet and very low level of long-term debt, we are positioned to build on the first quarter’s terrific momentum. In light of the resilience of our business and these underlying strengths, Genie’s Board of Directors has increased our quarterly dividend 13% to $0.085 per share.”

CONSOLIDATED RESULTS

* Adjusted EBITDA for all periods presented is a non-GAAP measure intended to provide useful information that supplements the core operating results in accordance with GAAP of Genie Energy or the relevant segment. Please refer to the ‘Reconciliation of Non-GAAP Financial Measures’ at the end of this release for an explanation of Adjusted EBITDA as well as for reconciliations to its most directly comparable GAAP measures.

** Genie Energy accounts for its investments in Orbit Energy, its joint venture operating in the U.K., and Atid, a drilling contractor based in Israel in which it holds a minority stake, under the equity method of accounting. Under this method, Genie Energy records its share in the net income or loss of the venture. Therefore, revenue generated and expenses incurred are not reflected in Genie Energy’s consolidated revenue and expenses. However, Orbit Energy’s customers are included in metrics regarding our global customer base.

GLOBAL METERS AND RCEs

Genie Energy’s global customer base increased sequentially and year-over-year driven by investment in customer acquisition in domestic and overseas markets. Genie Energy’s global RCE and meter totals are provided in the chart below.

*** Includes RCEs and meters acquired and served by Genie Energy’s domestic and international retail energy provider businesses including operations in Finland and Japan and at Genie’s joint venture in the U.K. (although U.K. operations are not included in our consolidated results of operations).

SEGMENT RESULTS

Genie Retail Energy (GRE)

GRE’s financial results are summarized in the chart below:

GRE – KPIs and Take-Aways:

Genie Retail Energy International (GRE International)

Genie Energy accounts for its investments in Orbit Energy, its joint venture operating in the U.K., under the equity method of accounting. Revenue generated, and expenses incurred, are not reflected in segment revenue and operating expenses. RCE and meter counts do, however, include Orbit Energy customers.

GRE International – KPIs and Take-Aways:

**** Pro forma results for all periods presented are non-GAAP measures intended to provide useful information that supplement the core operating results in accordance with GAAP of the relevant segment. Please refer to the ‘Reconciliation of Non-GAAP Financial Measures’ at the end of this release for an explanation of the pro forma results as well as for reconciliations to their most directly comparable GAAP measures.

Genie Energy Services (GES)

GES comprises Diversegy, a commercial energy consulting business, Genie’s interest in Prism Solar, a supplier of solar panels and solutions, and Genie Solar Energy.

Genie Oil and Gas (GOGAS)

Genie Energy accounts for its minority interest in Atid, a drilling company based in Israel, under the equity method of accounting. Atid’s revenue generated, and expenses incurred, are not reflected in segment revenue and operating expenses.

Corporate

BALANCE SHEET AND CASH FLOW HIGHLIGHTS

At March 31, 2020, Genie Energy had $157.2 million in total assets, including $36.4 million in cash, cash equivalents and restricted cash. Liabilities totaled $72.0 million and working capital (current assets less current liabilities) totaled $51.1 million an increase of $10.3 million from December 31, 2019.

Cash used in operating activities in 1Q20 was $2.7 million compared to cash provided by operating activities of $7.0 million in 1Q19. Operating cash flow in the quarter was negatively impacted by the deliveries of solar panels at Prism Solar (with cash payment having been made in 2019) and the posting of cash collateral in support of certain hedge positions at GRE.

DIVIDEND ON GENIE ENERGY COMMON STOCK

Genie's Board of Directors has declared a first quarter dividend of $0.085, a $0.01 increase from prior quarters, with a record date of May 19, 2020. The dividend will be paid on or about May 29, 2020. The distribution will be treated as an ordinary dividend for income tax purposes.

GENIE ENERGY EARNINGS CONFERENCE CALL

This earnings press release is available for download in the “Investors” section of the Genie Energy website (https://genie.com/investors/investor-relations/) and has been filed on a current report (Form 8-K) with the SEC.

At 2:00 PM Eastern time today, May 7, 2020, Genie Energy’s management will host a conference call to discuss financial and operational results, business outlook and strategy. The call will begin with management’s remarks followed by Q&A with investors.

To participate in the conference call, dial 1-888-348-6472 (toll-free from the US) or 1-412-902-4240 (international) and request the Genie Energy conference call.

Approximately three hours after the call, a call replay will be accessible by dialing 1-844-512-2921 (toll-free from the US) or 1-412-317-6671 (international) and providing the replay PIN: 10143670. The replay will remain available through May 14, 2020. A recording of the call - in MP3 format - will also be available for playback on the “Investors” section of the Genie Energy website.

Investors can sign up through the Genie Energy website to have earnings releases and other press releases e-mailed directly to them.

ABOUT GENIE ENERGY LTD.

Genie Energy Ltd. (NYSE: GNE, GNEPRA), is a global provider of energy services. The Genie Retail Energy division supplies electricity, including electricity from renewable resources, and natural gas to residential and small business customers in the United States. The Genie Retail Energy International division supplies customers in Europe and Asia. The Genie Energy Services division includes Diversegy, a commercial and industrial brokerage and consultative services company, and Genie Solar Energy and Prism Solar, which design, supply and install commercial solar solutions. For more information, visit Genie.com.

In this press release, all statements that are not purely about historical facts, including, but not limited to, those in which we use the words “believe,” “anticipate,” “expect,” “plan,” “intend,” “estimate, “target” and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors, including, but not limited to, those described in our most recent report on SEC Form 10-K (under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”), which may be revised or supplemented in subsequent reports on SEC Forms 10-Q and 8-K. We are under no obligation, and expressly disclaim any obligation, to update the forward-looking statements in this press release, whether as a result of new information, future events or otherwise.

Contact:

Genie Energy Investor Relations

Bill Ulrey

P: (973) 438-3848

E-mail: invest@genie.com

GENIE ENERGY LTD. 

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts) 

GENIE ENERGY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

GENIE ENERGY LTD. 

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Reconciliation of Non-GAAP Financial Measures for the First Quarter 2020

In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States of America (GAAP), Genie Energy also disclosed for the first quarter 2020, as well as for comparable periods, pro forma results and Adjusted EBITDA, which are non-GAAP measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.

Genie Energy’s measure of pro forma results consist of the corresponding GAAP metric with the addition of the corresponding results for Orbit Energy, the company’s joint venture operating in the United Kingdom. GAAP results for Orbit Energy are accounted for under the equity method of accounting. Under this method, Genie Energy records its share in the net income or loss of the venture. Therefore, revenue generated, expenses incurred and income from operations are not reflected in Genie Energy’s consolidated revenue and expenses. However, Orbit Energy’s customers are included in metrics regarding our customer base. Pro forma results are calculated by adding the result for Orbit Energy to its corresponding GAAP result. Pro forma results are provided for the first quarter 2020 and first quarter 2019 to supplement the following results: consolidated revenue; revenue of the Genie Retail Energy International segment; and loss from operations for the Genie Retail Energy International segment.

Genie Energy’s measure of Adjusted EBITDA consists of gross profit less selling, general and administrative expense, exploration expense and equity in the net loss of in equity method investees, net, plus depreciation, amortization and stock-based compensation (which are included in selling, general and administrative expense). Another way of calculating Adjusted EBITDA is to start with income from operations and add depreciation, amortization, stock-based compensation and impairment of goodwill and subtract equity in net loss in equity method investees, net.

Management believes that Genie Energy’s pro forma results and Adjusted EBITDA provide useful information to both management and investors by excluding certain expenses that may not be indicative of Genie Energy’s or the relevant segment’s core operating results. Management uses the pro forma results and Adjusted EBITDA, among other measures, as relevant indicators of core operational strengths in its financial and operational decision making. In addition, management uses and Adjusted EBITDA to evaluate operating performance in relation to Genie Energy’s competitors. Disclosure of this financial measure may be useful to investors in evaluating performance and allows for greater transparency to the underlying supplemental information used by management in its financial and operational decision-making. In addition, Genie Energy has historically reported Adjusted EBITDA and believes it is commonly used by readers of financial information in assessing performance, therefore the inclusion of comparative numbers provides consistency in financial reporting at this time.

The pro forma results facilitates evaluation of the results of all of the company’s retail energy provider (REP) businesses as if they were fully consolidated, which provides useful information regarding the size, growth and financial performance of all of the company’s REP businesses, In contrast, GAAP results only include the company’s equity in the results of the operations of its U.K. venture.

Management refers to pro forma results and Adjusted EBITDA, as well as the GAAP measures revenue, gross profit, income (loss) from operations and net income (loss), on a segment and/or consolidated level to facilitate internal and external comparisons to the segments’ and Genie Energy's historical operating results, in making operating decisions, for budget and planning purposes, and to form the basis upon which management is compensated.

Although depreciation and amortization are considered operating costs under GAAP, they primarily represent the non-cash current period allocation of costs associated with long-lived assets acquired or constructed in prior periods. While Genie Energy’s oil and gas exploration business may be capital intensive, Genie Energy does not expect to incur significant depreciation or depletion expense for the foreseeable future. Genie Energy’s operating results exclusive of depreciation and amortization is therefore a useful indicator of its current performance.

Stock-based compensation recognized by Genie Energy and other companies may not be comparable because of the various valuation methodologies, subjective assumptions and the variety of types of awards that are permitted under GAAP. Stock-based compensation is excluded from Genie Energy’s calculation of Adjusted EBITDA because management believes this allows investors to make more meaningful comparisons of the operating results of Genie Energy’s core business with the results of other companies. However, stock-based compensation will continue to be a significant expense for Genie Energy for the foreseeable future and an important part of employees’ compensation that impacts their performance.

Impairment of goodwill is a component of (loss) income from operations that is excluded from the calculation of Adjusted EBITDA. The impairment of goodwill is primarily dictated by events and circumstances outside the control of management that trigger an impairment analysis. While there may be similar charges in other periods, the nature and magnitude of these charges can fluctuate markedly and do not reflect the performance of Genie Energy's continuing operations.

Pro forma revenue and pro forma income from operations as well as Adjusted EBITDA should be considered in addition to, not as a substitute for, or superior to, revenue, gross profit, income from operations, cash flow from operating activities, net income, basic and diluted earnings per share or other measures of liquidity and financial performance prepared in accordance with GAAP. In addition, Genie Energy’s measurements of pro forma revenue, pro forma income from operations and Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.

Following is the reconciliation of pro forma results and Adjusted EBITDA to their most directly comparable GAAP measure. Pro forma consolidated revenue is reconciled to consolidated revenue, pro forma revenue for the Genie Retail Energy International segment is reconciled to the segment’s revenue, and Genie Retail Energy International’s loss from operations is reconciled to the segment’s loss from operation. Adjusted EBITDA is reconciled to income from operations for Genie Energy’s reportable segments and net income for Genie Energy on a consolidated basis.

Reconciliations of Pro Forma Genie Retail Energy International Segment Revenue 

and Loss from Operations to Corresponding GAAP Results

Reconciliations of Consolidated Adjusted EBITDA to Net Income Attributable to Genie Energy Limited

and of Adjusted EBITDA to Income from Operations for All Segments Reported

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