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| | |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 |
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2023
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period
from to
Commission File Number: 001-36559
Via Renewables, Inc.
(Exact name of registrant as specified in its charter)
| | | | | | | | | | | | | | |
| | | | |
Delaware | | | | 46-5453215 |
(State or other jurisdiction of incorporation or organization) | | | | (I.R.S. Employer Identification No.) |
12140 Wickchester Ln, Suite 100
Houston, Texas 77079
(Address of principal executive offices)
(713) 600-2600
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | |
Title of each class | Trading Symbols(s) | Name of exchange on which registered |
Class A common stock, par value $0.01 per share | VIA | The NASDAQ Global Select Market |
8.75% Series A Fixed-to-Floating Rate
Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share | VIASP | The NASDAQ Global Select Market |
Indicate
by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.
Yes ☒ No ☐
Indicate
by check mark whether the registrant has submitted electronically every
Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405 of this Chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit
such files).
Yes ☒ No ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, a smaller reporting company,
or an emerging growth company. See the definitions of “large
accelerated filer,” “accelerated filer,” “smaller reporting company,”
and “emerging growth company” in Rule 12b-2 of the Exchange
Act.
Large accelerated filer ☐ Accelerated filer ☒
Non-accelerated filer ☐
Smaller reporting company ☐
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. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒
There were 3,232,701 shares of Class A common stock, 4,000,000 shares of Class B common stock and 3,567,543 shares of Series A Preferred Stock outstanding as of October 31, 2023.
| | | | | | | | |
VIA RENEWABLES, INC. | | |
INDEX TO QUARTERLY REPORT ON FORM 10-Q | | |
For the Quarter Ended September 30, 2023 | | |
| | Page No. |
PART I. FINANCIAL INFORMATION | | |
ITEM 1. FINANCIAL STATEMENTS | | |
| | |
CONDENSED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2023 AND DECEMBER 31, 2022 (unaudited) | | |
| | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022 (unaudited) | | |
| | |
CONDENSED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE THREE AND NINE
MONTHS ENDED SEPTEMBER 30, 2023 AND 2022 (unaudited) | | |
| | |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022 (unaudited) | | |
| | |
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) | | |
| | |
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | | |
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | | |
ITEM 4. CONTROLS AND PROCEDURES | | |
PART II. OTHER INFORMATION | | |
ITEM 1. LEGAL PROCEEDINGS | | |
ITEM 1A. RISK FACTORS | | |
| | |
| | |
| | |
| | |
ITEM 6. EXHIBITS | | |
| | |
SIGNATURES | | |
| | |
Cautionary Note Regarding Forward Looking Statements
This
Quarterly Report on Form 10-Q (this “Report”) contains forward-looking
statements that are subject to a number of risks and uncertainties, many
of which are beyond our control. These forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended (the “Securities Act”) and Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), can be identified
by the use of forward-looking terminology including “may,” “should,”
“could,” “likely,” “will,” “believe,” “expect,” “anticipate,”
“estimate,” “continue,” “plan,” “intend,” “project,” or other similar
words. Forward-looking statements appear in a number of places in this
Report. All statements, other than statements of historical fact,
included in this Report are forward-looking statements. The
forward-looking statements include statements regarding the impacts of
Winter Storm Uri, cash flow generation and liquidity, business strategy,
prospects for growth and acquisitions, outcomes of legal proceedings,
the timing, availability, ability to pay and implied amount of cash
dividends and distributions on our Class A common stock and Series A
Preferred Stock, future operations, financial position, estimated
revenues and losses, projected costs, prospects, plans, objectives,
beliefs of management, availability and terms of capital, competition,
government regulation and general economic conditions. Although we
believe that the expectations reflected in such forward-looking
statements are reasonable, we cannot give any assurance that such
expectations will prove correct.
The
forward-looking statements in this Report are subject to risks and
uncertainties. Important factors that could cause actual results to
materially differ from those projected in the forward-looking statements
include, but are not limited to:
•our
ability to remediate the material weakness in our internal control over
financial reporting, the identification of any additional material
weakness in the future or otherwise failing to maintain an effective
system of internal controls;
•the
ultimate impact of the Winter Storm Uri, including future benefits or
costs related to ERCOT market securitization efforts, and any corrective
action by the State of Texas, ERCOT, the Railroad Commission of Texas,
or the Public Utility Commission of Texas;
•changes in commodity prices, the margins we achieve, and interest rates;
•the sufficiency of risk management and hedging policies and practices;
•the impact of extreme and unpredictable weather conditions, including hurricanes, heat waves and other natural disasters;
•federal,
state and local regulations, including the industry's ability to
address or adapt to potentially restrictive new regulations that may be
enacted by public utility commissions;
•our ability to borrow funds and access credit markets;
•restrictions and covenants in our debt agreements and collateral requirements;
•credit risk with respect to suppliers and customers;
•our ability to acquire customers and actual attrition rates;
•changes in costs to acquire customers;
•accuracy of billing systems;
•our ability to successfully identify, complete, and efficiently integrate acquisitions into our operations;
•significant changes in, or new changes by, the independent system operators (“ISOs”) in the regions we operate;
•competition; and
•the
“Risk Factors” in our Annual Report on Form 10-K for the year ended
December 31, 2022, in our Quarterly Reports on Form 10-Q in "Item
1A — Risk Factors" of this Report, and in our other public filings and
press releases.
You
should review the Risk Factors and other factors noted throughout or
incorporated by reference in this Report that could cause our actual
results to differ materially from those contained in any forward-looking
statement. All forward-looking statements speak only as of the date of
this Report. Unless required by law, we disclaim any obligation to
publicly update or revise these statements whether as a result of new
information, future events or otherwise. It is not possible for us to
predict all risks, nor can we assess the impact of all factors on the
business or
the
extent to which any factor, or combination of factors, may cause actual
results to differ materially from those contained in any
forward-looking statements.
PART I. — FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
VIA RENEWABLES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share counts)
(unaudited)
| | | | | | | | | | | |
| September 30, 2023 | | December 31, 2022 |
Assets | | | |
Current assets: | | | |
Cash and cash equivalents | $ | 45,137 | | | $ | 33,658 | |
Restricted cash | — | | | 1,693 | |
Accounts receivable, net of allowance for credit losses of $4,935 at September 30, 2023 and $4,335 at December 31, 2022 | 51,275 | | | 81,466 | |
Accounts receivable—affiliates | 4,569 | | | 6,455 | |
Inventory | 3,027 | | | 4,405 | |
Fair value of derivative assets, net | 166 | | | 1,632 | |
Customer acquisition costs, net | 5,005 | | | 3,530 | |
Customer relationships, net | 342 | | | 2,520 | |
| | | |
Deposits | 8,230 | | | 10,568 | |
Renewable energy credit asset | 24,871 | | | 24,251 | |
| | | |
Other current assets | 7,524 | | | 8,749 | |
Total current assets | 150,146 | | | 178,927 | |
Property and equipment, net | 4,758 | | | 4,691 | |
Fair value of derivative assets, net | — | | | 666 | |
Customer acquisition costs, net | 1,729 | | | 1,683 | |
Customer relationships, net | 225 | | | 481 | |
Deferred tax assets | 17,100 | | | 20,437 | |
Goodwill | 120,343 | | | 120,343 | |
Other assets | 2,775 | | | 3,722 | |
Total assets | $ | 297,076 | | | $ | 330,950 | |
| | | |
Liabilities, Series A Preferred Stock and Stockholders' Equity | | | |
Current liabilities: | | | |
Accounts payable | $ | 22,548 | | | $ | 53,296 | |
Accounts payable—affiliates | 1,062 | | | 265 | |
Accrued liabilities | 10,413 | | | 8,431 | |
Renewable energy credit liability | 13,173 | | | 13,722 | |
Fair value of derivative liabilities, net | 13,497 | | | 16,132 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
Other current liabilities | 58 | | | 322 | |
Total current liabilities | 60,751 | | | 92,168 | |
Long-term liabilities: | | | |
Fair value of derivative liabilities, net | 1,451 | | | 2,715 | |
| | | |
Long-term portion of Senior Credit Facility | 105,000 | | | 100,000 | |
Subordinated debt—affiliates | — | | | 20,000 | |
| | | |
| | | |
| | | |
| | | |
Other long-term liabilities | — | | | 18 | |
Total liabilities | 167,202 | | | 214,901 | |
Commitments and contingencies (Note 12) | | | |
| | | |
Series A Preferred Stock, par value $0.01 per share, 20,000,000 shares authorized, 3,567,543 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 88,045 | | | 87,713 | |
| | | |
Stockholders' equity: | | | |
Common Stock: | | | |
| | | |
Class A common stock, par value $0.01 per share, 120,000,000 shares authorized, 3,261,620 shares issued and 3,232,701 shares outstanding at September 30, 2023 and 3,200,472 shares issued and 3,171,553 shares outstanding at December 31, 2022 | 32 | | | 32 | |
Class B common stock, par value $0.01 per share, 60,000,000 shares authorized, 4,000,000 shares issued and outstanding at September 30, 2023 and December 31, 2022 | 40 | | | 40 | |
| | | |
| | | |
Additional paid-in capital | 39,230 | | | 42,871 | |
Accumulated other comprehensive loss | (40) | | | (40) | |
Retained earnings | 12,038 | | | 2,073 | |
Treasury stock, at cost, 28,919 shares at September 30, 2023 and December 31, 2022 | (2,406) | | | (2,406) | |
Total stockholders' equity | 48,894 | | | 42,570 | |
Non-controlling interest in Spark HoldCo, LLC | (7,065) | | | (14,234) | |
Total equity | 41,829 | | | 28,336 | |
Total liabilities, Series A Preferred Stock and Stockholders' equity | $ | 297,076 | | | $ | 330,950 | |
The accompanying notes are an integral part of the condensed consolidated financial statements.
VIA RENEWABLES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | 2022 | | 2023 | | 2022 |
| | | | | | | |
Revenues: | | | | | | | |
Retail revenues | $ | 109,753 | | | $ | 117,187 | | | $ | 337,499 | | | $ | 343,592 | |
Net asset optimization (expense) revenue | (936) | | | 1,672 | | | (5,568) | | | (480) | |
Other revenue | 1,422 | | | — | | | 1,559 | | | — | |
Total Revenues | 110,239 | | | 118,859 | | | 333,490 | | | 343,112 | |
Operating Expenses: | | | | | | | |
Retail cost of revenues | 71,050 | | | 102,212 | | | 234,417 | | | 232,621 | |
General and administrative | 17,135 | | | 16,302 | | | 51,073 | | | 44,820 | |
Depreciation and amortization | 1,816 | | | 3,270 | | | 7,146 | | | 13,390 | |
Total Operating Expenses | 90,001 | | | 121,784 | | | 292,636 | | | 290,831 | |
Operating income (loss) | 20,238 | | | (2,925) | | | 40,854 | | | 52,281 | |
Other (expense) income: | | | | | | | |
Interest expense | (2,233) | | | (2,002) | | | (7,377) | | | (5,129) | |
Interest and other income | 9 | | | 11 | | | 96 | | | 265 | |
Total other expenses | (2,224) | | | (1,991) | | | (7,281) | | | (4,864) | |
Income (loss) before income tax expense | 18,014 | | | (4,916) | | | 33,573 | | | 47,417 | |
Income tax expense (benefit) | 3,355 | | | (48) | | | 6,599 | | | 8,726 | |
Net income (loss) | $ | 14,659 | | | $ | (4,868) | | | $ | 26,974 | | | $ | 38,691 | |
Less: Net income (loss) attributable to non-controlling interests | 7,140 | | | (3,987) | | | 11,661 | | | 21,981 | |
Net income (loss) attributable to Via Renewables, Inc. stockholders | $ | 7,519 | | | $ | (881) | | | $ | 15,313 | | | $ | 16,710 | |
Less: Dividend on Series A Preferred Stock | 2,708 | | | 2,026 | | | 7,892 | | | 5,677 | |
Net income (loss) attributable to stockholders of Class A common stock | $ | 4,811 | | | $ | (2,907) | | | $ | 7,421 | | | $ | 11,033 | |
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Net income (loss) attributable to Via Renewables, Inc. per share of Class A common stock | | | | | | | |
Basic | $ | 1.49 | | | $ | (0.92) | | | $ | 2.32 | | | $ | 3.50 | |
Diluted | $ | 1.47 | | | $ | (0.92) | | | $ | 2.29 | | | $ | 3.48 | |
| | | | | | | |
Weighted average shares of Class A common stock outstanding | | | | | | | |
Basic | 3,232 | | | 3,172 | | | 3,204 | | | 3,151 | |
Diluted | 7,232 | | | 3,172 | | | 7,204 | | | 3,173 | |
| | | | | | | |
The accompanying notes are an integral part of the condensed consolidated financial statements.
VIA RENEWABLES, INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(in thousands)
(unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Nine Months Ended September 30, 2023 |
| Issued Shares of Class A Common Stock | Issued Shares of Class B Common Stock | Treasury Stock | Class A Common Stock | Class B Common Stock | Treasury Stock | | Accumulated Other Comprehensive Loss | Additional Paid-in Capital | Retained Earnings | Total Stockholders' Equity | Non-controlling Interest | Total Equity |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Balance at December 31, 2022 | 3,201 | | 4,000 | | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | | $ | (40) | | $ | 42,871 | | $ | 2,073 | | $ | 42,570 | | $ | (14,234) | | $ | 28,336 | |
Stock based compensation | — | | — | | — | | | — | | — | | | — | | 1,779 | | — | | 1,779 | | — | | 1,779 | |
Restricted stock unit vesting | 47 | | | — | | — | | — | | — | | | — | | (186) | | — | | (186) | | — | | (186) | |
Consolidated net income | — | | — | | — | | — | | — | | — | | | — | | — | | 15,313 | | 15,313 | | 11,661 | | 26,974 | |
Stock issued - reverse stock split | 14 | | — | | — | | — | | — | | — | | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | |
Distributions paid to non-controlling unit holders | — | | — | | — | | — | | — | | — | | | — | | — | | — | | — | | (4,308) | | (4,308) | |
Dividends paid to Class A common stockholders ($0.90625 per share) | — | | — | | — | | — | | — | | — | | | — | | (2,874) | | — | | (2,874) | | — | | (2,874) | |
Dividends paid to Preferred Stockholders | — | | — | | — | | — | | — | | — | | | — | | (2,544) | | (5,348) | | (7,892) | | — | | (7,892) | |
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| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Changes in ownership interest | — | | — | | — | | — | | — | | — | | | — | | 184 | | — | | 184 | | (184) | | — | |
Balance at September 30, 2023 | 3,262 | | 4,000 | | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | | $ | (40) | | $ | 39,230 | | $ | 12,038 | | $ | 48,894 | | $ | (7,065) | | $ | 41,829 | |
The accompanying notes are an integral part of the condensed consolidated financial statements.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Three Months Ended September 30, 2023 |
| Issued Shares of Class A Common Stock | Issued Shares of Class B Common Stock | Treasury Stock | Class A Common Stock | Class B Common Stock | Treasury Stock | Accumulated Other Comprehensive Loss | Additional Paid-in Capital | Retained Earnings | Total Stockholders' Equity | Non-controlling Interest | Total Equity |
Balance at June 30, 2023 | 3,260 | 4,000 | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | $ | (40) | | $ | 38,559 | | $ | 7,227 | | $ | 43,412 | | $ | (13,944) | | $ | 29,468 | |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
Stock based compensation | — | — | — | — | — | — | — | | 485 | — | 485 | — | 485 |
Restricted stock unit vesting | 2 | — | — | — | — | — | — | — | — | — | — | — |
Consolidated net income | — | | — | | — | | — | | — | | — | | — | | — | | 7,519 | 7,519 | 7,140 | 14,659 |
Distributions paid to non-controlling unit holders | — | — | — | — | — | — | — | — | — | — | (75) | (75) |
| | | | | | | | | | | | |
Dividends paid to Preferred Stockholders | — | — | — | — | — | — | — | — | (2,708) | (2,708) | — | (2,708) |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
Changes in Ownership Interest | — | — | — | — | — | — | — | 186 | — | 186 | (186) | — |
Balance at September 30, 2023 | 3,262 | | 4,000 | | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | $ | (40) | | $ | 39,230 | | $ | 12,038 | | $ | 48,894 | | $ | (7,065) | | $ | 41,829 | |
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The accompanying notes are an integral part of the condensed consolidated financial statements.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Nine Months Ended September 30, 2022 |
| Issued Shares of Class A Common Stock | Issued Shares of Class B Common Stock | Treasury Stock | Class A Common Stock | Class B Common Stock | Treasury Stock | | Accumulated Other Comprehensive Loss | Additional Paid-in Capital | Retained Earnings (Deficit) | Total Stockholders' Equity | Non-controlling Interest | Total Equity |
Balance at December 31, 2021 | 3,159 | | 4,000 | | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | | $ | (40) | | $ | 53,918 | | $ | 173 | | $ | 51,717 | | $ | (3,168) | | $ | 48,549 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Stock based compensation | — | | — | | — | | — | | — | | — | | | — | | 2,478 | | — | | 2,478 | | — | | 2,478 | |
Restricted stock unit vesting | 42 | | | — | | — | | — | | — | | | — | | (471) | | — | | (471) | | — | | (471) | |
Consolidated net income | — | | — | | — | | — | | — | | — | | | — | | — | | 16,710 | | 16,710 | | 21,981 | | 38,691 | |
| | | | | | | | | | | | | |
Distributions paid to non-controlling unit holders | — | | — | | — | | — | | — | | — | | | — | | — | | — | | — | | (10,928) | | (10,928) | |
Dividends paid to Class A common stockholders ($2.71875 per share) | — | | — | | — | | — | | — | | — | | | — | | — | | (8,587) | | (8,587) | | — | | (8,587) | |
Dividends paid to Preferred Stockholders | — | | — | | — | | — | | — | | — | | | — | | — | | (5,677) | | (5,677) | | — | | (5,677) | |
| | | | | | | | | | | | | |
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Changes in ownership interest | — | | — | | — | | — | | — | | — | | | — | | 213 | | — | | 213 | | (213) | | — | |
Balance at September 30, 2022 | 3,201 | | 4,000 | | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | | $ | (40) | | $ | 56,138 | | $ | 2,619 | | $ | 56,383 | | $ | 7,672 | | $ | 64,055 | |
The accompanying notes are an integral part of the condensed consolidated financial statements.
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Three Months Ended September 30, 2022 |
| Issued Shares of Class A Common Stock | Issued Shares of Class B Common Stock | Treasury Stock | Class A Common Stock | Class B Common Stock | Treasury Stock | | Accumulated Other Comprehensive Loss | Additional Paid-in Capital | Retained Earnings (Deficit) | Total Stockholders' Equity | Non-controlling Interest | Total Equity |
Balance at June 30, 2022 | 3,201 | | 4,000 | | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | | $ | (40) | | $ | 55,702 | | $ | 8,401 | | $ | 61,729 | | $ | 15,099 | | $ | 76,828 | |
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Stock based compensation | — | | — | | — | | — | | — | | — | | | — | | 621 | | — | | 621 | | — | | 621 | |
| | | | | | | | | | | | | |
Consolidated net loss | — | | — | | — | | — | | — | | — | | | — | | — | | (881) | | (881) | | (3,987) | | (4,868) | |
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Distributions paid to non-controlling unit holders | — | | — | | — | | — | | — | | — | | | — | | — | | — | | — | | (3,625) | | (3,625) | |
Dividends paid to Class A common stockholders ($0.90625 per share) | — | | — | | — | | — | | — | | — | | | — | | — | | (2,874) | | (2,874) | | — | | (2,874) | |
Dividends paid to Preferred Stockholders | — | | — | | — | | — | | — | | — | | | — | | — | | (2,027) | | (2,027) | | — | | (2,027) | |
| | | | | | | | | | | | | |
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Changes in ownership interest | — | | — | | — | | — | | — | | — | | | — | | (185) | | — | | (185) | | 185 | | — | |
Balance at September 30, 2022 | 3,201 | | 4,000 | | (29) | | $ | 32 | | $ | 40 | | $ | (2,406) | | | $ | (40) | | $ | 56,138 | | $ | 2,619 | | $ | 56,383 | | $ | 7,672 | | $ | 64,055 | |
The accompanying notes are an integral part of the condensed consolidated financial statements.
VIA RENEWABLES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
| | | | | | | | | | | |
| Nine Months Ended September 30, |
| 2023 | | 2022 |
Cash flows from operating activities: | | | |
Net income | $ | 26,974 | | | $ | 38,691 | |
Adjustments to reconcile net income to net cash flows provided by operating activities: | | | |
Depreciation and amortization expense | 7,146 | | | 13,390 | |
Deferred income taxes | 3,337 | | | 5,048 | |
| | | |
Stock based compensation | 1,784 | | | 2,590 | |
Amortization of deferred financing costs | 619 | | | 919 | |
| | | |
| | | |
Bad debt expense | 2,717 | | | 2,895 | |
Loss (gain) on derivatives, net | 50,428 | | | (55,815) | |
Current period cash settlements on derivatives, net | (51,767) | | | 35,922 | |
| | | |
Other | 126 | | | 43 | |
Changes in assets and liabilities: | | | |
Decrease in accounts receivable | 27,473 | | | 7,075 | |
Decrease (increase) in accounts receivable—affiliates | 1,886 | | | (1,824) | |
Decrease (increase) in inventory | 1,378 | | | (3,292) | |
Increase in customer acquisition costs | (4,961) | | | (4,274) | |
Decrease in prepaid and other current assets | 1,895 | | | 1,978 | |
| | | |
Decrease (increase) in other assets | 641 | | | (722) | |
Decrease in accounts payable and accrued liabilities | (29,334) | | | (19,771) | |
Increase (decrease) in accounts payable—affiliates | 797 | | | (60) | |
Decrease in other current liabilities | (264) | | | (1,475) | |
Decrease in other non-current liabilities | (18) | | | (107) | |
Net cash provided by operating activities | 40,857 | | | 21,211 | |
Cash flows from investing activities: | | | |
Purchases of property and equipment | (1,144) | | | (1,940) | |
Acquisition of Customers | — | | | (4,460) | |
| | | |
Net cash used in investing activities | (1,144) | | | (6,400) | |
Cash flows from financing activities: | | | |
| | | |
Borrowings on notes payable | 258,000 | | | 229,000 | |
Payments on notes payable | (253,000) | | | (271,000) | |
Net (paydown) borrowings on subordinated debt facility | (20,000) | | | 20,000 | |
| | | |
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Restricted stock vesting | (186) | | | (663) | |
| | | |
| | | |
Payment of dividends to Class A common stockholders | (2,874) | | | (8,587) | |
Payment of distributions to non-controlling unitholders | (4,308) | | | (10,928) | |
Payment of Preferred Stock dividends | (7,559) | | | (5,602) | |
| | | |
Net cash used in financing activities | (29,927) | | | (47,780) | |
Increase (decrease) in Cash, cash equivalents and Restricted cash | 9,786 | | | (32,969) | |
Cash, cash equivalents and Restricted cash—beginning of period | 35,351 | | | 75,320 | |
Cash, cash equivalents and Restricted cash—end of period | $ | 45,137 | | | $ | 42,351 | |
Supplemental Disclosure of Cash Flow Information: | | | |
Non-cash items: | | | |
Property and equipment purchase accrual | $ | 15 | | | $ | (8) | |
| | | |
| | | |
| | | |
Cash paid during the period for: | | | |
Interest | $ | 6,736 | | | $ | 3,347 | |
Taxes | $ | 2,671 | | | $ | 280 | |
The accompanying notes are an integral part of the condensed
consolidated financial statements.
VIA RENEWABLES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. Formation and Organization
Organization
We
are an independent retail energy services company that provides
residential and commercial customers in competitive markets across the
United States with an alternative choice for natural gas and
electricity. The Company is a holding company whose primary asset
consists of units in Spark HoldCo, LLC (“Spark HoldCo”). The Company is
the sole managing member of Spark HoldCo, is responsible for all
operational, management and administrative decisions relating to Spark
HoldCo’s business and consolidates the financial results of Spark HoldCo
and its subsidiaries. Spark HoldCo is the direct and indirect owner of
the subsidiaries through which we operate our retail energy services. We
conduct our retail energy services business through several brands
across our service areas, including Electricity Maine, Electricity N.H.,
Major Energy, Provider Power Massachusetts, Spark Energy, and Verde
Energy. Via Energy Solutions (“VES”) is a wholly owned subsidiary of the
Company that offers broker services for retail energy customers. Via
Wireless is a wholly owned subsidiary of the Company that offers
wireless services and equipment to wireless customers.
2. Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation
The
accompanying interim unaudited condensed consolidated financial
statements of the Company have been prepared in accordance with
accounting principles generally accepted in the United States (“GAAP”)
and pursuant to the rules and regulations of the Securities and Exchange
Commission (“SEC”) as it applies to interim financial statements. This
information should be read along with our consolidated financial
statements and notes contained in our annual report on Form 10-K for the
year ended December 31, 2022 (the “2022 Form 10-K”). Our unaudited
condensed consolidated financial statements are presented on a
consolidated basis and include all wholly-owned and controlled
subsidiaries. We account for investments over which we have significant
influence but not a controlling financial interest using the equity
method of accounting. All significant intercompany transactions and
balances have been eliminated in the unaudited condensed consolidated
financial statements.
In
the opinion of the Company's management, the accompanying condensed
consolidated financial statements reflect all adjustments that are
necessary to fairly present the financial position, the results of
operations, the changes in equity and the cash flows of the Company for
the respective periods. Such adjustments are of a normal recurring
nature, unless otherwise disclosed.
Use of Estimates and Assumptions
The
preparation of our condensed consolidated financial statements requires
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at
the date of the interim financial statements and the reported amounts of
revenues and expenses during the period. Actual results could
materially differ from those estimates.
Relationship with our Founder, Majority Shareholder, and Chief Executive Officer
W.
Keith Maxwell, III (our "Founder") is the Chief Executive Officer, a
director and the owner of a majority of the voting power of our common
stock through his ownership of NuDevco Retail, LLC ("NuDevco Retail")
and Retailco, LLC ("Retailco"). Retailco is a wholly owned subsidiary of
TxEx Energy Investments, LLC ("TxEx"), which is wholly owned by Mr.
Maxwell. NuDevco Retail is a wholly owned subsidiary of NuDevco Retail
Holdings
LLC ("NuDevco Retail Holdings"), which is a wholly owned subsidiary of
Electric HoldCo, LLC, which is also a wholly owned subsidiary of TxEx.
ERCOT Securitization Proceeds
In June 2022, the Company received $9.6 million
from Electric Reliability Council of Texas ("ERCOT") related to Public
Utility Regulatory Act ("PURA") Subchapter N Securitization financing.
The Company accounted for the proceeds received as the recovery of costs
of sales and services from a vendor under FASB ASC Topic 705, Cost of Sales and Services reflected
as a reduction of retail cost of revenues within our consolidated
statements of operations for the nine months ended September 30, 2022,
as that is where the initial costs related to the impact of Winter Storm
Uri were recorded.
New Accounting Standards Recently Adopted
There have been no changes to our significant accounting policies as disclosed in our 2022 Form 10-K.
Standards Being Evaluated/Standards Not Yet Adopted
The
Company considers the applicability and impact of all ASUs. New ASUs
were assessed and determined to be either not applicable or are expected
to have minimal impact on our consolidated financial statements.
3. Revenues
Our
revenues are derived primarily from the sale of natural gas and
electricity to customers, including affiliates. Revenue is measured
based upon the quantity of gas or power delivered at prices contained or
referenced in the customer's contract, and excludes any sales
incentives (e.g., rebates) and amounts collected on behalf of third
parties (e.g., sales tax).
Our
revenues also include asset optimization activities. Asset optimization
activities consist primarily of purchases and sales of gas that meet
the definition of trading activities per FASB ASC Topic 815, Derivatives and Hedging. They are therefore excluded from the scope of FASB ASC Topic 606, Revenue from Contracts with Customers.
Other
revenue is derived from contracts with customers through the provision
of wireless and other services and the sale of wireless equipment.
Revenues
for electricity, natural gas, and related services are recognized as
the Company transfers the promised goods and services to the customer. Electricity
and natural gas products may be sold as fixed-price or variable-price
products. The typical length of a contract to provide electricity and/or
natural gas is twelve months. Customers are billed and
generally pay at least monthly, based on usage. Electricity and natural
gas sales that have been delivered but not billed by period end are
estimated and recorded as accrued unbilled revenues based on estimates
of customer usage since the date of the last meter read provided by the
utility. Volume estimates are based on forecasted volumes and estimated
residential and commercial customer usage. Unbilled revenues are
calculated by multiplying these volume estimates by the applicable rate
by customer class (residential or commercial). Estimated amounts are
adjusted when actual usage is known and billed.
The
following table discloses revenue for our reportable segments by
primary geographical market, customer type, and customer credit risk
profile (in thousands). The table also includes a reconciliation of the
disaggregated revenue to revenue by reportable segment (in thousands).
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| Reportable Segments |
| Three Months Ended September 30, 2023 | | Three Months Ended September 30, 2022 |
| Retail Electricity (a) | | Retail Natural Gas | | | | Total Reportable Segments | | Retail Electricity (a) | | Retail Natural Gas | | | | Total Reportable Segments |
| | | | | | | | | | | | | | | |
Primary markets (b) | | | | | | | | | | | | | | | |
New England | $ | 30,119 | | | $ | 993 | | | | | $ | 31,112 | | | $ | 31,366 | | | $ | 821 | | | | | $ | 32,187 | |
Mid-Atlantic | 32,858 | | | 3,478 | | | | | 36,336 | | | 33,761 | | | 5,281 | | | | | 39,042 | |
Midwest | 9,384 | | | 1,089 | | | | | 10,473 | | | 12,165 | | | 1,617 | | | | | 13,782 | |
Southwest | 25,494 | | | 6,338 | | | | | 31,832 | | | 27,678 | | | 4,498 | | | | | 32,176 | |
| $ | 97,855 | | | $ | 11,898 | | | | | $ | 109,753 | | | $ | 104,970 | | | $ | 12,217 | | | | | $ | 117,187 | |
| | | | | | | | | | | | | | | |
Customer type | | | | | | | | | | | | | | | |
Commercial | $ | 11,655 | | | $ | 6,577 | | | | | $ | 18,232 | | | $ | 12,560 | | | $ | 6,661 | | | | | $ | 19,221 | |
Residential | 87,012 | | | 5,411 | | | | | 92,423 | | | 97,177 | | | 5,047 | | | | | 102,224 | |
Unbilled revenue (c) | (812) | | | (90) | | | | | (902) | | | (4,767) | | | 509 | | | | | (4,258) | |
| $ | 97,855 | | | $ | 11,898 | | | | | $ | 109,753 | | | $ | 104,970 | | | $ | 12,217 | | | | | $ | 117,187 | |
| | | | | | | | | | | | | | | |
Customer credit risk | | | | | | | | | | | | | | | |
POR | $ | 55,603 | | | $ | 4,078 | | | | | $ | 59,681 | | | $ | 63,444 | | | $ | 6,202 | | | | | $ | 69,646 | |
Non-POR | 42,252 | | | 7,820 | | | | | 50,072 | | | 41,526 | | | 6,015 | | | | | 47,541 | |
| $ | 97,855 | | | $ | 11,898 | | | | | $ | 109,753 | | | $ | 104,970 | | | $ | 12,217 | | | | | $ | 117,187 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Reportable Segments |
| Nine Months Ended September 30, 2023 | | Nine Months Ended September 30, 2022 |
| Retail Electricity (a) | | Retail Natural Gas | | | | Total Reportable Segments | | Retail Electricity (a) | | Retail Natural Gas | | | | Total Reportable Segments |
| | | | | | | | | | | | | | | |
Primary markets (b) | | | | | | | | | | | | | | | |
New England | $ | 89,268 | | | $ | 6,060 | | | | | $ | 95,328 | | | $ | 84,463 | | | $ | 7,331 | | | | | $ | 91,794 | |
Mid-Atlantic | 84,548 | | | 28,753 | | | | | 113,301 | | | 89,304 | | | 32,396 | | | | | 121,700 | |
Midwest | 24,342 | | | 13,409 | | | | | 37,751 | | | 31,396 | | | 14,358 | | | | | 45,754 | |
Southwest | 57,289 | | | 33,830 | | | | | 91,119 | | | 70,138 | | | 14,206 | | | | | 84,344 | |
| $ | 255,447 | | | $ | 82,052 | | | | | $ | 337,499 | | | $ | 275,301 | | | $ | 68,291 | | | | | $ | 343,592 | |
| | | | | | | | | | | | | | | |
Customer type | | | | | | | | | | | | | | | |
Commercial | $ | 31,301 | | | $ | 47,021 | | | | | $ | 78,322 | | | $ | 33,119 | | | $ | 37,854 | | | | | $ | 70,973 | |
Residential | 227,669 | | | 49,158 | | | | | 276,827 | | | 246,662 | | | 36,392 | | | | | 283,054 | |
Unbilled revenue (c) | (3,523) | | | (14,127) | | | | | (17,650) | | | (4,480) | | | (5,955) | | | | | (10,435) | |
| $ | 255,447 | | | $ | 82,052 | | | | | $ | 337,499 | | | $ | 275,301 | | | $ | 68,291 | | | | | $ | 343,592 | |
| | | | | | | | | | | | | | | |
Customer credit risk | | | | | | | | | | | | | | | |
POR | $ | 146,826 | | | $ | 36,432 | | | | | $ | 183,258 | | | $ | 166,346 | | | $ | 41,147 | | | | | $ | 207,493 | |
Non-POR | 108,621 | | | 45,620 | | | | | 154,241 | | | 108,955 | | | 27,144 | | | | | 136,099 | |
| $ | 255,447 | | | $ | 82,052 | | | | | $ | 337,499 | | | $ | 275,301 | | | $ | 68,291 | | | | | $ | 343,592 | |
(a) Retail Electricity includes Services
(b) The primary markets include the following states:
•New England - Connecticut, Maine, Massachusetts and New Hampshire;
•Mid-Atlantic - Delaware, Maryland (including the District of Columbia), New Jersey, New York, Pennsylvania and Virginia;
•Midwest - Illinois, Indiana, Michigan and Ohio; and
•Southwest - Arizona, California, Colorado, Florida, Nevada and Texas.
(c)
Unbilled revenue is recorded in total until it is actualized, at which
time it is categorized between commercial and residential customers.
Reconciliation to Consolidated Financial Information
A reconciliation of the reportable segment operating revenues to consolidated revenues is as follows:
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | 2022 | | 2023 | | 2022 |
Total Reportable Segments Revenue | $ | 109,753 | | | $ | 117,187 | | | $ | 337,499 | | | $ | 343,592 | |
Net asset optimization (expense) revenue | (936) | | | 1,672 | | | (5,568) | | | (480) | |
Other Revenue | 1,422 | | | — | | | 1,559 | | | — | |
Total Revenues | $ | 110,239 | | | $ | 118,859 | | | $ | 333,490 | | | $ | 343,112 | |
We
record gross receipts taxes on a gross basis in retail revenues and
retail cost of revenues. During the three months ended September 30,
2023 and 2022, our retail revenues included gross receipts taxes of $0.3 million and $0.4 million, respectively, and our retail cost of revenues included gross receipts taxes of $1.5 million and $1.4 million,
respectively. During the nine months ended September 30, 2023 and 2022,
our retail revenues included gross receipt taxes of $0.8 million and $1.0 million, respectively, and our retail cost of revenues included gross receipts taxes of $4.1 million and $4.0 million, respectively.
Accounts receivables and Allowance for Credit Losses
The
Company conducts business in many utility service markets where the
local regulated utility purchases our receivables, and then becomes
responsible for billing the customer and collecting payment from the
customer (“POR programs”). These POR programs result in substantially
all of the Company’s credit risk being linked to the applicable utility,
which generally has an investment-grade rating, and not to the end-use
customer. The Company monitors the financial condition of each utility
and currently believes its receivables are collectible.
In
markets that do not offer POR programs or when the Company chooses to
directly bill its customers, certain receivables are billed and
collected by the Company. The Company bears the credit risk on these
accounts and records an appropriate allowance for doubtful accounts to
reflect any losses due to non-payment by customers. The Company’s
customers are individually insignificant and geographically dispersed in
these markets. The Company writes off customer balances when it
believes that amounts are no longer collectible and when it has
exhausted all means to collect these receivables.
For
trade accounts receivables, the Company accrues an allowance for credit
losses by business segment by pooling customer accounts receivables
based on similar risk characteristics, such as customer type, geography,
aging analysis, payment terms, and related macro-economic factors.
Expected credit loss exposure is evaluated for each of our accounts
receivables pools. Expected credits losses are established using a model
that considers historical collections experience, current information,
and reasonable and supportable forecasts. The Company writes off
accounts receivable balances against the allowance for credit losses
when the accounts receivable is deemed to be uncollectible.
A
rollforward of our allowance for credit losses for the nine months
ended September 30, 2023 are presented in the table below (in
thousands):
| | | | | | | | | | | |
| | | | | |
| | | | | |
Balance at December 31, 2022 | | | | | $ | (4,335) | |
| | | | | |
Current period credit loss provision | | | | | (2,717) | |
Write-offs | | | | | 2,200 | |
Recovery of previous write-offs | | | | | (83) | |
Balance at September 30, 2023 | | | | | $ | (4,935) | |
4. Equity
Non-controlling Interest
We
hold an economic interest and are the sole managing member in Spark
HoldCo, with affiliates of our Founder holding the remaining economic
interests in Spark HoldCo. As a result, we consolidate the financial
position and results of operations of Spark HoldCo, and reflect the
economic interests owned by these affiliates as a non-controlling
interest. The
Company and affiliates owned the following economic interests in Spark
HoldCo at September 30, 2023 and December 31, 2022,
respectively.
| | | | | | | | |
| The Company | Affiliated Owners |
September 30, 2023 | 44.92 | % | 55.08 | % |
December 31, 2022 | 44.45 | % | 55.55 | % |
The
following table summarizes the portion of net income and income tax
expense attributable to non-controlling interest (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | 2022 | | 2023 | | 2022 |
| | | | | | | |
Net income (loss) before taxes allocated to non-controlling interest | $ | 8,398 | | | $ | (3,909) | | | $ | 14,021 | | | $ | 23,432 | |
Less: Income tax expense allocated to non-controlling interest | 1,258 | | | 78 | | | 2,360 | | | 1,451 | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
Net income (loss) attributable to non-controlling interests | $ | 7,140 | | | $ | (3,987) | | | $ | 11,661 | | | $ | 21,981 | |
Class A Common Stock and Class B Common Stock
Holders
of the Company's Class A common stock and Class B common stock vote
together as a single class on all matters presented to our stockholders
for their vote or approval, except as otherwise required by applicable
law or by our certificate of incorporation.
Reverse Stock Split
On
March 20, 2023, the Company’s shareholders approved at a special
meeting a proposal by the Company’s Board of Directors to consummate a
reverse stock split of the Company’s Class A common stock at a ratio
between 1 for 2 to 1 for 5 and (ii) Class B common stock at a ratio
between 1 for 2 to 1 for 5, with such ratios to be determined by the
Chief Executive Officer or the Chief Financial Officer, or to determine
not to proceed with the reverse stock split, during a period of time not
to exceed the one-year anniversary of the special meeting date (the
“Reverse Stock Split”).
On
March 20, 2023, the Company filed a Certificate of Amendment to the
Company’s Amended and Restated Certificate of Incorporation with the
Delaware Secretary of State to effect the Reverse Stock Split at a ratio
of 1 to 5
for
each issued and outstanding share of Class A common stock and Class B
common stock as of March 21, 2023 at 5:30 PM ET. The Class A common
stock began trading on a post-split basis on March 22, 2023.
No
fractional shares were issued as a result of the Reverse Stock Split
and it did not impact the par value of the Class A common stock or Class
B common stock. Any fractional shares that would otherwise have
resulted from the Reverse Stock Split were rounded up to the next whole
number. The number of authorized shares of Common Stock remained
unchanged at 120,000,000 shares of Class A common stock and 60,000,000 shares of Class B common stock.
All
shares of Class A common stock and Class B common stock and per share
amounts in the accompanying consolidated financial statements and
related notes have been retrospectively restated to reflect the effect
of the Reverse Stock Split effective March 21, 2023.
Dividends on Class A Common Stock
Dividends
declared for the Company's Class A common stock are reported as a
reduction of retained earnings, or a reduction of additional paid in
capital to the extent retained earnings are exhausted. During the three
and nine months ended September 30, 2023, we paid zero and $2.9 million in dividends to the holders of the Company's Class A common stock.
If
we pay our stated dividends to holders of our Class A common stock, our
subsidiary, Spark HoldCo is required to make corresponding
distributions to holders of its units, including those holders that own
our Class B common stock (our non-controlling interest holder). As a
result, during the three and nine months ended September 30, 2023, Spark
HoldCo made corresponding distributions of zero and $3.6 million to our non-controlling interest holders.
In
April 2023, we announced that our Board of Directors elected to
temporarily suspend the quarterly cash dividend on the Class A common
stock. During the three months ended September 30, 2023, we did not pay
dividends to the holders of the Company's Class A common stock and did
not make corresponding distributions to our non-controlling interest
holders.
Earnings Per Share
Basic
earnings per share (“EPS”) is computed by dividing net income
attributable to stockholders (the numerator) by the weighted-average
number of Class A common shares outstanding for the period (the
denominator). Class B common shares are not included in the calculation
of basic earnings per share because they are not participating
securities and have no economic interests. Diluted earnings per share is
similarly calculated except that the denominator is increased by
potentially dilutive securities.
The
following table presents the computation of basic and diluted income
per share for the three and nine months ended September 30, 2023 and
2022 (in thousands, except per share data):
| | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | 2022 | | 2023 | 2022 | |
Net income (loss) attributable to Via Renewables, Inc. stockholders | $ | 7,519 | | $ | (881) | | | $ | 15,313 | | $ | 16,710 | | |
Less: Dividend on Series A Preferred Stock | 2,708 | | 2,026 | | | 7,892 | | 5,677 | | |
Net income (loss) attributable to stockholders of Class A common stock | $ | 4,811 | | $ | (2,907) | | | $ | 7,421 | | $ | 11,033 | | |
| | | | | | |
Basic weighted average Class A common shares outstanding | 3,232 | | 3,172 | | | 3,204 | | 3,151 | | |
Basic income (loss) per share attributable to stockholders | $ | 1.49 | | $ | (0.92) | | | $ | 2.32 | | $ | 3.50 | | |
| | | | | | |
Net income (loss) attributable to stockholders of Class A common stock | $ | 4,811 | | $ | (2,907) | | | $ | 7,421 | | $ | 11,033 | | |
Effect of conversion of Class B common stock to shares of Class A common stock | 5,803 | | — | | | 9,088 | | — | | |
| | | | | | |
Diluted net income (loss) attributable to stockholders of Class A common stock | $ | 10,614 | | $ | (2,907) | | | $ | 16,509 | | $ | 11,033 | | |
| | | | | | |
Basic weighted average Class A common shares outstanding | 3,232 | | 3,172 | | | 3,204 | | 3,151 | | |
Effect of dilutive Class B common stock | 4,000 | | — | | | 4,000 | | — | | |
| | | | | | |
Effect of dilutive restricted stock units | — | | — | | | — | | 22 | | |
Diluted weighted average shares outstanding | 7,232 | | 3,172 | | | 7,204 | | 3,173 | | |
| | | | | | |
Diluted income (loss) per share attributable to stockholders | $ | 1.47 | | $ | (0.92) | | | $ | 2.29 | | $ | 3.48 | | |
The computation of diluted earnings per share for the three and nine months ended September 30, 2022, excludes 4.0 million and 4.0 million
shares of Class B common stock because the effect of their conversion
was antidilutive. The Company's outstanding shares of Series A Preferred
Stock were not included in the calculation of diluted earnings per
share because they contain only contingent redemption provisions that
have not occurred.
Variable Interest Entity
Spark
HoldCo is a variable interest entity due to its lack of rights to
participate in significant financial and operating decisions and its
inability to dissolve or otherwise remove its management. Spark HoldCo
owns all of the outstanding membership interests in each of our
operating subsidiaries except VES. We are the sole managing member of
Spark HoldCo, manage Spark HoldCo's operating subsidiaries through this
managing membership interest, and are considered the primary beneficiary
of Spark HoldCo. The assets of Spark HoldCo cannot be used to settle
our obligations except through distributions to us, and the liabilities
of Spark HoldCo cannot be settled by us except through contributions to
Spark HoldCo. The
following table includes the carrying amounts and classification of the
assets and liabilities of Spark HoldCo that are included in our
condensed consolidated balance sheet as of September 30, 2023 and
December 31, 2022 (in thousands):
| | | | | | | | |
| September 30, 2023 | December 31, 2022 |
Assets | | |
Current assets: | | |
Cash and cash equivalents | $ | 44,539 | | $ | 33,267 | |
Accounts receivable | 50,689 | | 81,363 | |
| | |
Other current assets | 50,812 | | 61,162 | |
Total current assets | 146,040 | | 175,792 | |
Non-current assets: | | |
Goodwill | 120,343 | | 120,343 | |
| | |
Other assets | 11,106 | | 13,675 | |
Total non-current assets | 131,449 | | |