Good day, and welcome to Genie Energy's Third Quarter 2021 Earnings Call. Operator instructions were provided. On this morning's call, Michael Stein, Genie Energy's Chief Executive Officer and Avi Goldin, Genie Energy's Chief Financial Officer, will discuss operational and financial results for the 3-month period ended September 30, 2021. Any forward-looking statements made during this conference call, either in the prepared remarks or in the Q&A session, whether general or specific in nature, are subject to risks and uncertainties that may cause actual results to differ materially from those which the company anticipates. These risks and uncertainties include, but are not limited to, specific risks and uncertainties discussed in the reports that Genie Energy files periodically with the SEC. Genie Energy assumes no obligation, either to update any forward-looking statements that they have made or may make or to update the factors that may cause actual results to differ materially from those that they forecast. During the remarks, management may make reference to adjusted EBITDA, a non-GAAP measure. Management believes that Genie Energy's measure of adjusted EBITDA provides useful information to both management and investors that supplement Genie Energy's core operating results. The Genie Energy earnings release includes a reconciliation of consolidated adjusted EBITDA to its nearest comparable GAAP measures, consolidated net income and income from operations for all periods presented. In addition, adjusted EBITDA for applicable segments are reconciled to their respective segment's income from operations for all periods presented. The Genie Energy earnings release is posted on the Investor Relations page of the Genie Corporation website, genie.com, and has been filed on a Form 8-K with the SEC. After today's presentation by Genie Energy's management, there will be an opportunity to ask questions. Operator instructions were provided. Please note, this event is being recorded. I will now turn the conference over to Michael Stein, Genie Energy's Chief Executive Officer. Please go ahead, Mr. Stein.

Thank you, operator. Welcome to Genie Energy's Third Quarter 2021 Earnings Call. Today, we plan to start the call with an update on the Oriel spin-off transaction and our ongoing exit from the U.K. retail market and discuss how this impacts our growth strategy moving forward. I will also provide a review of our operational high-level financial results for the 3 months ended September 30, 2021. Avi Goldin, our Chief Financial Officer, will then provide a deeper dive into the quarter's financial results, and then we will be glad to take your questions. As we previously announced, our plans for an Oriel Energy equity offering spin-off during fiscal year 2021 were derailed by market conditions impacting our Orbit subsidiary in the U.K. This market has faced increasing challenges over the past 8 weeks, as the regulatory body in the U.K. decided not to raise price caps to keep up with significant spikes in wholesale energy costs. As a result, 19 energy supply companies have already filed for bankruptcy. In response to these factors, after the third quarter closed, we pivoted and began to work with the U.K. regulators on an orderly exit from this market. Talks are ongoing, and we anticipate providing an update when we have finalized an arrangement with the regulators. In Q3, Orbit's loss from operations increased from $4.2 million last year to $16.4 million this year due to asset write-downs and incremental bad debt expense of $10.5 million related to the planned exit from the U.K. market. On a go-forward basis, once we have agreement with the regulators, we will classify Orbit's operating results as discontinued operations. Regardless, we are no longer investing in this business and currently expect no material negative cash impact from its operations in future quarters. I want to be clear that Orbit was unprofitable and a relatively immature business compared to our cash-generating U.S. and Scandinavian operations. Additionally, the regulatory environment in the U.K. is very different than in the U.S. and Scandinavia as it institutes price caps after we entered the market, and it is impossible to pass on extraordinary spikes in wholesale costs to customers. So where does this leave us moving forward? As I stated last quarter, Genie Energy owns a portfolio of assets that offer an attractive investment opportunity within the energy space. And our diversification, both within markets and geographically, reduces our risk profile as we saw in Q3. At the corporate level, it leaves us with a strong debt-free balance sheet, a major competitive differentiator that we expect will get stronger over the next couple of quarters as we both generate cash from operations as well as exit the U.K. market, which required additional investment of growth capital. It leaves us with a profitable asset-light Genie Retail Energy business, or GRE for short, that has demonstrated a resilient ability to generate cash in a variety of market conditions. This business currently operates in 17 of 27 deregulated states, plus Washington D.C. And our mid- to long-term strategy is to opportunistically grow when market conditions warrant by taking share in existing states, expanding into new states and offering additional products and services to our installed base. We will also, at times, take steps to slow growth and protect margins over a shorter time horizon when market conditions are not as favorable, which is what we are doing this winter. It also leaves us with two growth arms: First is our emerging growth business in Scandinavia, which will, in the immediate term, constitute Genie Retail Energy International, or GREI for short. This business is already adjusted-EBITDA positive, and we expect to see increased profitability in 2022. Longer term, this business affords the opportunity to expand into a handful of other European countries, bringing the total potential addressable market to more than 30 million meters over the next few years. Our Genie Renewables business is another exciting growth opportunity. Over the past year, we have taken steps to significantly improve its margins and, as we recently discussed, have the opportunity to move up the solar value chain through project finance by leveraging our strong balance sheet. We believe this initiative will provide attractive financial returns, increase the win rate on new projects and contribute more meaningfully to top line and adjusted EBITDA growth. Moving to our third quarter performance. We reported a record 37% gross margin and generated record adjusted EBITDA. GRE was the main driver behind the strength, delivering a record 40% gross margin and 23% adjusted EBITDA margin. Mark-to-market gains in our financial hedges and continued high per-meter consumption rates drove this strong performance. Customer acquisition at GRE has not returned to full pre-COVID strength, but our churn rate remained below typical pre-COVID levels at 4%. GREI grew its meter base by nearly 6% and reported strong gross margin despite the situation in the U.K. We believe our Scandinavian business is outperforming the competition for higher-margin customers and has delivered positive income from operations of $4 million year-to-date. Looking to Q4, we are shifting our short-term tactics to preserve margin and maximize cash flow. This is a move we have made from time to time based on market conditions. As such, we are currently positioned favorably with our hedges and forward contracts relative to the pre-winter run-up in wholesale energy and natural gas prices, allowing us to focus more acutely on high-margin customer acquisition while reducing overall sales costs. Additionally, we have some low-margin aggregation deals that are coming off the books, which should further improve our financial profile to invest in sales activities heading into the spring. Genie Renewables will continue to focus on customer acquisition and adding new projects. We have begun on a limited basis to offer financing to our solar system offerings, which we believe will both help us win new business and increase project returns. In summary, we are excited about our potential and look forward to updating you further on performance and growth initiatives next quarter as well as on the development of the U.K. situation. Now over to Avi Goldin for his discussion of our Q3 financial results.

Thank you, Michael, and thanks to everyone on the call for joining us this morning. My remarks today cover our financial results for the 3 months ended September 30, 2021. Throughout my remarks, I compare the third quarter 2021 results to the third quarter of 2020, focusing on the year-over-year rather than the sequential comparisons, in consideration of the seasonal factors that are characteristic of our retail energy business. I'd also like to point out that there are some moving parts this quarter and make an apples-to-apples comparison somewhat challenging. For example, we acquired the part of Orbit Energy's equity that we didn't already own in the fourth quarter of 2020. So while our third quarter 2020 results were not consolidated into our financials, they were in the third quarter of 2021 under Genie Retail International. On the flip side, we sold our Japanese operations in early Q2 2021, while in Q3 2020, a full quarter of Genie Japan revenue was recorded under GREI. And finally, we are assessing the impact of our planned exit from the U.K. market. I'll provide some color on these impacts throughout my part of this call. That said, results from this quarter were generally strong relative to last year. Consolidated revenue increased 18% to $113 million. The top line increase is generated mostly by GREI, where revenue increased to $25.5 million from $5.8 million in the year-ago quarter, mainly reflecting the consolidation of the results at Orbit in the current period. For comparison, Orbit generated $15.1 million in revenue in Q3 2020, which was not reflected in our reported revenue figures. Revenue at Genie Retail Energy, our domestic retail business, decreased 3% to $86 million, driven by a decline in both electricity meters served and consumption, while natural gas saw an increase in meters and consumption per meter. It is important to note, while down from last year, consumption per unit remained above pre-COVID levels for the season. This quarter's overall consumption was offset by higher average sales for commodity units. We also saw increased churn from the prior quarter, albeit below historical levels. Additionally, we continue to be limited in access to our traditional face-to-face marketing channels that generally drive growth. Revenue for our Renewables business is $1.3 million, a decrease from $1.6 million in the year-ago quarter. As Michael mentioned, the decline in revenue was not unexpected and was offset by improved margins. We're excited about the potential of this segment as we continue to expand into higher-margin renewables-focused businesses, including our commercial solar installations, community solar projects and system financing. Consolidated gross profit increased 55% to $42.4 million, and gross margins expanded by 700 basis points, a very strong third quarter result, with increased contributions from all three of our reporting segments. In addition to strong underlying business performance, we benefited from a reduction of cost due to the approval of the plan for the State of Texas' reimbursement of expenses related to Winter Storm Uri as well as some mark-to-market gains in our forward financial contracts as wholesale prices have increased heading into the winter. Consolidated SG&A increased to $28.9 million from $18.8 million. The increase was primarily from GRE International and reflecting consolidation into Orbit Energy, which added $10.7 million in SG&A expense, including customer acquisition expenses. The decision to explore an exit from the U.K. market resulted in a $6.7 million write-down in intangible assets as well as approximately $3.8 million in bad debt expense above normal levels. Our consolidated income from operations totaled $6.9 million compared to $8.5 million year-ago quarter. The key driver here was again the impact of Orbit Energy I just mentioned. Adjusted EBITDA increased 58.5% to $15 million compared to $9.5 million in the year-ago quarter. Genie Energy's loss per diluted share was $0.10 compared to EPS of $0.24 in the year-ago quarter. In addition to the $0.26 per share negative impact from the U.K. write-off of assets, our bottom line was negatively impacted by an unrealized loss of $5.3 million on marketable securities, predominantly our investment in Rafael Holdings. Note that Rafael reported disappointing news last week and we reasonably expect an additional unrealized loss in the fourth quarter as the stock was down sharply. Turning now to the balance sheet. At quarter end, cash, restricted cash and marketable securities totaled $48.6 million. Working capital was $44.4 million. To wrap up, our financial results from operations were strong. Our balance sheet is also in good shape. And with the planned exit from the U.K., we would expect to see lower rates of ongoing cash burn and a higher adjusted EBITDA. We continue to believe the value of our hedging, geographic diversification and other risk-mitigation strategies are a competitive differentiator and will allow us to grow the business and invest in other attractive opportunities. Now operator, back to you for Q&A.

Operator instructions were provided. Our first question today is coming from Aaron Shafter at Great Mountain Capital.

Congratulations on some strong numbers. I do have some concerns, though. Avi answered some of them regarding Orbit and the situation in the U.K., but two other questions relating to that. One is that you mentioned that the regulators there were unwilling to raise the limit on rates given the extraordinary situation. And I'm wondering if this rule on rates and being basically a hard rate cap existed before or after you purchased the outstanding amount of Orbit that your former partners held?

So the cap was instituted after we entered the market in 2017. It was instituted shortly after. And we were able to see decent margins subsequent to the price cap being instituted. So this is a situation that we could never possibly envision. And it's a situation where we believe it's kind of a force majeure kind of a situation that the regulators are not inappropriately responding to.

And I think Michael mentioned something about updating in the future the situation in the U.K. Did I hear that correctly? And what type of update would it be?

It would be an update just on operationally, when and how we got out of—we no longer had any customers to serve—and what the write-down associated, if any, would be as a result. Again, we don't believe there'll be any negative cash impact but there may be similar write-downs of intangibles.

Okay. And before this, your big surprise was early in the year, you had the once-in-100-year situation and crazy weather in Texas. Is there any progress at all on getting any more relief from that?

Yes. So we—I think Avi mentioned in his remarks—we got another—you may recall last quarter, we announced that we got about $1.5 million of relief from the Texas government. This quarter, we announced that we got, I believe, the number was $1.9 million of relief from Texas, and we continue to work with other industry representatives to try to get more.

And just to be clear, that the funds will flow through and are expected to start at sort of the first half of 2022. So the order was formally approved and voted on. But the mechanism by which entities are going to receive their relief should kick in in the first half of 2022.

Okay. You noted in the release that you repurchased 230,000 shares of the Genie common at $1.4 million. So that roughly works out to $6.08 a share. Yesterday, the stock closed just below $5 a share, more than 20% lower than your purchase price. I'm wondering if you have plans to maybe increase buybacks given that would seem to be an attractive level for the shares.

We continue to have the authorization from the Board to do buybacks. And our position is to do it opportunistically when we think the share price is attractive. So I can't tell you exactly what we're going to do. But our strategy, our general feeling about it, is much the same.

And related to that, obviously, recently, the common stock has had a noted decline, but the preferred stock has had a noted increase. So it seems that investors in the preferred have confidence that you'll be able to continue paying the dividend on the preferred, but investors in the common are concerned about the company in general. How do you convince investors in the common to look more like investors with the preferred?

I think we just—we have to execute. We have to execute, catch a few breaks or not get hit by some of these events that under normal circumstances seem very rare. I think with a few quarters of execution and some of this difficulty behind us, I think hopefully, the market will react.

Okay. And are there any other markets that you're in that have these type of hard caps on rates like the U.K.?

No.

Can we assume that you don't plan on entering any markets that have a hard cap on rates?

We don’t know of any that we’re interested in going into right now. And as I said, in the U.K., they introduced it after we had already entered the market. It generally probably would have changed our attention about entering the market, but we had been operating for a few years. So we thought that the regulator was responsible enough with how they set that cap and would be responsible in a kind of a force majeure situation, but it seems like we were proven wrong in that regard.

Operator instructions were provided. Our next question today is coming from David Canam at Canam Wealth Management.

I'm going to keep it simple. I don't have a whole lot. But given—in general, given your outlook on the business going forward, exiting the U.K., the prospects for the remaining international Scandinavia, et cetera—you’re going to be generating significant free cash flow. I appreciate the fact that you're buying back stock. What's your view on dividends at this time? Historically, the common has paid a dividend. Is the Board's appetite to further shrink the common share count first and then go back to dividends? Or is it something for discussion now?

So I think it's probably something that's going to come up, if I had to guess, after next quarter. We did not—we have not discussed reinstituting the dividend yet. I think at the time when we suspended the dividend, I think we had indicated we wanted to take about a year to think about it, a few quarters at least. So we're still continuing to think about it.

Okay. I mean I appreciate the fact that the company is buying back stock. My personal opinion is at these levels, we're better off buying back as much stock as possible. But then once the stock recovers, paying dividends, which would ultimately be more for the remaining common shareholders given a shrunk in share count. So while I wish you much luck in the future, I hope you don't get hit by any of these crazy events anymore. Hopefully, it will be smooth sailing going forward. Good luck.

Thank you.

Thank you.

Operator instructions were provided. This concludes our question-and-answer session and conference call. Thank you for attending today's presentation. You may now disconnect.