Shares of Genie Energy Ltd. GNE have lost 6.3% since reporting results for the fourth quarter of 2024. This compares to the S&P 500 index’s 2.8% decline over the same time frame. Over the past month, the stock has edged down 1.7% compared with the S&P 500’s 8.3% fall.
Financial Performance
Genie Energy’s earnings per share for fourth-quarter 2024 were 24 cents, a 33.9% decrease from 37 cents in the prior-year quarter.
For the fourth quarter of 2024, GNE’s consolidated revenues declined 1.9% year over year to $102.9 million from $104.9 million. Gross profit was $33.5 million, down 0.5% from the prior-year quarter. The company’s gross margin improved to 32.5% from 32.1%. Loss from operations narrowed significantly to $20.8 million from a loss of $34.2 million a year earlier due to a lower non-cash charge for its captive insurance operations.
The net loss attributable to common shareholders was $15.3 million, or $0.58 per diluted share, compared with a loss of $24.5 million, or $0.90 per diluted share, in the prior-year quarter. On a non-GAAP basis, which excludes the impact of the insurance loss reserve, net income was $6.5 million, down from $10 million in the fourth quarter of 2023.
For the year, revenues dipped 0.8% year over year to $425.2 million. Gross profit declined 5.3% to $138.5 million, with the gross margin compressing to 32.6% from 34.1%. Adjusted EBITDA reached $48.5 million, achieving the upper end of management’s guidance but falling short of the $58.2 million recorded in 2023. Net income attributable to common shareholders was $12.6 million compared with $19.2 million in the prior year.
Genie Energy Ltd. Price, Consensus and EPS Surprise
Genie Energy Ltd. Price, Consensus and EPS Surprise
Genie Energy Ltd. price-consensus-eps-surprise-chart | Genie Energy Ltd. Quote
Retail Energy & Renewables Segments
Genie Retail Energy (“GRE”), which supplies electricity and natural gas to residential and small business customers, recorded revenues of $98.4 million for the quarter, which was flat year over year. Electricity sales were $82.1 million, unchanged year over year. Natural gas revenues increased 7.5% to $16.2 million. Despite the positive impacts of increased customer meters, lower revenue per kilowatt-hour offset this gain. Income from operations in the segment fell 15.9% to $12.6 million. Adjusted EBITDA declined 13% to $13.4 million, reflecting reduced electricity margins and higher customer acquisition costs.
For the year, GRE revenues decreased 1.6% year over year to $403.3 million, with electricity sales of $350.5 million. Natural gas revenues declined 6.9% to $52.1 million. Income from operations dropped 21.4% to $56.5 million. The adjusted EBITDA fell 20.4% to $58.4 million.
Genie Renewables (“GREW”), which focuses on solar energy projects, saw a fourth-quarter revenue decline of 30.1% to $4.5 million due to a strategic shift away from commercial solar projects. However, the segment’s loss from operations narrowed to $0.7 million from $1.3 million a year ago. The adjusted EBITDA loss narrowed to $0.5 million from a $1.3 million loss in the fourth quarter of 2023, benefiting from growth in its Diversegy energy procurement business.
For the year, GREW’s revenues increased 16.1% year over year to $21.9 million. Gross profit skyrocketed 122.5% to $6.3 million. The segment’s loss from operations narrowed to $3 million from $5.8 million in 2023, and the adjusted EBITDA loss improved to $2.2 million from $5.4 million.
Management Commentary
CEO Michael Stein emphasized Genie Energy’s continued growth in retail and renewables. The company added more than 60,000 net meters in 2024, representing a 17% year-over-year increase, driven by customer acquisition efforts and retention strategies. In the fourth quarter alone, GRE added 23,000 net meters. However, the impacts of this expansion were partially offset by lower electricity consumption due to mild weather.
Stein also highlighted the company’s focus on expanding its footprint in Texas and California’s energy markets, citing them as key growth areas. In renewables, Genie Solar has shifted toward utility-scale projects, a move expected to provide long-term revenue benefits.
Factors Influencing Results
Lower electricity margins weighed on earnings, reflecting GNE’s continued transition toward fixed-price meters and aggregation contracts. However, it noted that fourth-quarter electricity margins remained above historical seasonal averages.
The company’s captive insurance subsidiary incurred a $30.9-million non-cash loss reserve charge in the quarter, down from $45.1 million in the prior year, which contributed to a narrower net loss. Excluding this impact, GNE’s adjusted earnings and EBITDA reflected a more stable underlying performance.
Guidance & Capital Allocation
For 2025, Genie Energy reiterated its annual consolidated adjusted EBITDA guidance of $40-$50 million, suggesting no change from that reported in 2024. Management expects to maintain its dividend while opportunistically repurchasing shares, having bought back 661,000 shares for $10.4 million in 2024.
The company ended the year with $201 million in cash, cash equivalents, restricted cash and marketable securities, an increase of $37.6 million from the prior year. GNE also strengthened its balance sheet through a solar financing deal that returned approximately $7 million in cash.
Other Developments
In the fourth quarter, Genie Solar closed its first financing deal for its portfolio of operating solar arrays, generating a return of $7 million. The company plans to use similar asset-backed financing structures to fund future solar expansions.
Genie has been scaling up its Roded environmental tech recycling business, which converts agricultural and industrial plastic waste into industrial products. While Roded accounted for approximately 25% of GREW’s total loss from operations, the company believes its patented technology positions it for growth.
Overall, GNE’s fourth-quarter results reflected solid operational execution amid margin pressures. While the company continues investing in customer acquisition and renewable initiatives, near-term profitability remains challenged by lower electricity margins and strategic shifts within its solar business.
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