Via Renewables(VIA) - 2023 Q1 - Quarterly Report

Company Operations - As of March 31, 2023, the company operated in 103 utility service territories across 20 states and the District of Columbia[136]. - The total number of residential customer equivalents (RCEs) increased by 2% from 331,000 on December 31, 2022, to 339,000 on March 31, 2023[141]. - The company added approximately 47,000 RCEs during the three months ended March 31, 2023, primarily through organic sales channels[146]. Revenue and Sales - For the three months ended March 31, 2023, approximately 61% of retail revenues were derived from electricity sales, while 39% came from natural gas sales[139]. - Total revenues for Q1 2023 were approximately $131.9 million, an increase of approximately $4.7 million, or 4%, from $127.2 million in Q1 2022[174]. - Approximately 55% of retail revenues for Q1 2023 were derived from territories where credit risk was with local regulated utility companies, compared to 64% in Q1 2022[225]. Financial Performance - Adjusted EBITDA for the three months ended March 31, 2023, was $18.811 million, compared to $10.788 million for the same period in 2022[159]. - Adjusted EBITDA for Q1 2023 was $18.8 million, compared to $10.8 million in Q1 2022, representing a 74% increase[175]. - The company reported a net loss of $6.8 million for Q1 2023, compared to a net income of $31.0 million in Q1 2022[175]. - The company experienced a net asset optimization loss of $3.3 million for the three months ended March 31, 2023[158]. Margins and Costs - Retail gross margin increased to $40.330 million for the three months ended March 31, 2023, from $28.755 million in the prior year[159]. - Retail gross margin for Q1 2023 was approximately $40.3 million, an increase of approximately $11.6 million, or 40%, from $28.8 million in Q1 2022[175]. - Retail cost of revenues for Q1 2023 was approximately $117.4 million, an increase of approximately $48.7 million, or 71%, from $68.7 million in Q1 2022[175]. - Retail gross margin for the Retail Electricity Segment was approximately $20.5 million, an increase of approximately $3.3 million, or 19%, from $17.2 million in Q1 2022[184]. - Retail gross margin for the Retail Natural Gas Segment was approximately $19.9 million, an increase of approximately $8.3 million, or 72%, from $11.6 million in Q1 2022[188]. Expenses - General and administrative expenses for Q1 2023 were approximately $17.2 million, an increase of approximately $2.3 million, or 15%, from $14.9 million in Q1 2022[176]. - Customer acquisition costs for Q1 2023 were approximately $1.8 million, an increase of $0.6 million, or 50%, from $1.2 million in Q1 2022[178]. Cash Flow and Liquidity - As of March 31, 2023, the company had total liquidity of $75.352 million, consisting of $45.162 million in cash and cash equivalents, $20.190 million available under the Senior Credit Facility, and $10.000 million under the Subordinated Debt Facility[195]. - Net cash provided by operating activities for the three months ended March 31, 2023, was $13.060 million, an increase of $8.5 million compared to $4.583 million for the same period in 2022[198]. - Cash flows used in investing activities increased by $3.2 million for the three months ended March 31, 2023, primarily due to customer acquisitions that did not re-occur in 2023[199]. - Cash flows used in financing activities decreased by $19.7 million for the three months ended March 31, 2023, mainly due to an increase in net borrowings of $40.0 million under the Senior Credit Facility[200]. Debt and Interest Rates - The company had $111.0 million of variable rate indebtedness outstanding under the Senior Credit Facility as of March 31, 2023[231]. - A 1.0% increase in interest rates would result in an additional annual interest expense of approximately $1.1 million based on average variable rate indebtedness for Q1 2023[231]. - The Senior Credit Facility allows the company to borrow up to $195.0 million, with a current variable interest rate of 8.30%[201][207]. Dividends - The company temporarily suspended the quarterly cash dividend on Class A common stock to enhance financial flexibility and manage market volatility[137]. - The company announced a temporary suspension of the quarterly cash dividend on Class A common stock as of April 19, 2023[192]. - The quarterly cash dividend declared for Series A Preferred Stock was $0.73989 per share, totaling $2.6 million for Q1 2023[232]. Derivative Instruments and Credit Risk - The company experienced a net loss of $(22.6) million on non-trading derivative instruments for the three months ended March 31, 2023, compared to a gain of $30.6 million for the same period in 2022[223]. - The Gas Non-Trading Fixed Price Open Position was a short position of 542,378 MMBtu as of March 31, 2023, with a potential fair market value change of $0.2 million for a 10% price increase or decrease[224]. - Bad debt expense for non-POR market retail revenues was 1.9% in Q1 2023, slightly down from 2.0% in Q1 2022[228]. - As of March 31, 2023, $1.6 million of total exposure of $2.3 million was with non-investment grade counterparties or unsecured[229]. - The company paid a weighted average discount of 1.0% for customer credit risk protection for both Q1 2023 and Q1 2022[225].