Via Renewables, Inc. (VIA) Q4 2023 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
Despite positive financial growth, the suspension of common stock dividends to strengthen the balance sheet introduces uncertainty. The Q&A session did not reveal any management evasiveness, which is a positive aspect. However, increased expenses and the strategic decision to suspend dividends for flexibility and growth opportunities may concern investors, leading to a neutral stock price prediction.
Key Financial Performance
Adjusted EBITDA (Q4 2023) $13.3 million, up from $12.6 million in Q4 2022; increase due to higher retail gross margin, partially offset by increased expenses.
Adjusted EBITDA (Full Year 2023) $56.9 million, up from $51.8 million in 2022; increase mainly due to higher gross margin, offset by increased expenses and a nonrecurring $4.4 million add-back for winter storm, Yuri.
Retail Gross Margin (Q4 2023) $33.7 million, compared to $31.9 million in Q4 2022; increase due to higher unit margins on natural gas, partially offset by lower natural gas volumes and lower electric unit margins.
Retail Gross Margin (Full Year 2023) $136.7 million, compared to $114.8 million in 2022; increase attributed to higher gross margin year-over-year.
G&A Expenses (Full Year 2023) $68.9 million, up from $61.9 million in 2022; increase primarily due to higher sales and marketing expenses and legal costs, including $1.6 million related to Via Wireless.
Interest Expense (Full Year 2023) $9.3 million, up from $7.2 million in 2022; increase primarily due to rising benchmark rates.
Income Tax Expense (Full Year 2023) $11.1 million, up from $6.5 million in 2022; increase due to higher net income.
Net Income (Full Year 2023) $26.1 million, compared to $11.2 million in 2022; increase despite a $4.9 million mark-to-market loss, compared to an $18 million mark-to-market loss in 2022.
Net Debt (Year-End 2023) $54.4 million; no year-over-year comparison provided.
Total Liquidity (Year-End 2023) $116 million; no year-over-year comparison provided.
RCEs (Year-End 2023) 335,000, up from 331,000 at the end of 2022; increase due to higher sales and decreased attrition.
Customer Acquisition Costs (Full Year 2023) $6.7 million, compared to $5.9 million in 2022; increase attributed to higher spending, offset by an uptick in free web ads.
Average Customer Attrition (Full Year 2023) 3.4%, down from 3.8% in 2022; decrease due to efforts in optimizing sales channels.
Operating Highlights
RCE Count: We ended the year with 335,000 RCEs, up from 331,000 RCEs at the end of 2022, which was due to an increase in year-over-year sales and a decrease in attrition.
Adjusted EBITDA: For the full-year of 2023, we reported adjusted EBITDA of $56.9 million up from $51.8 million in 2022.
Retail Gross Margin: Full-year retail gross margin was $136.7 million for 2023 compared to $114.8 million in 2022.
Customer Acquisition Costs: For the year, we spent $6.7 million in customer acquisition costs compared to $5.9 million in the prior year.
Attrition Rate: Our monthly average customer attrition was 3.4% for the year compared to 3.8% in 2022.
Dividend Suspension: In April 19, 2023, Via made the decision to suspend the dividend on the common stock in order to strengthen our balance sheet and add financial flexibility.
Risk or Challenges
Market Consolidation and Acquisition Opportunities: The company has experienced a purposeful shrinking of its book due to market consolidation and acquisition opportunities becoming less attractive.
Weather Events Impact: The decision to suspend the dividend was made to strengthen the balance sheet and provide financial flexibility in light of the foreseeable impacts of weather events.
Customer Acquisition Costs: Increased customer acquisition costs from $5.9 million in 2022 to $6.7 million in 2023, indicating challenges in maintaining and growing the customer base.
Interest Expense: Interest expense rose from $7.2 million in 2022 to $9.3 million in 2023 due to increases in benchmark rates, indicating financial pressure.
Regulatory and Legal Costs: G&A expenses increased primarily due to higher sales and marketing expenses and legal costs, which may pose regulatory challenges.
Economic Factors: The company faced lower power and natural gas volumes due to milder weather in the Northeast, impacting overall performance.
Guidance & Outlook
Organic Growth Strategy: In 2023, Via Renewables focused on optimizing organic sales channels and reducing attrition, achieving a lower average monthly attrition of 3.4% compared to 3.8% in 2022.
Dividend Suspension: In April 2023, Via suspended the dividend on common stock to strengthen the balance sheet and enhance financial flexibility for pursuing strategic growth opportunities.
Adjusted EBITDA Guidance: For the full year 2023, Via reported adjusted EBITDA of $56.9 million, an increase from $51.8 million in 2022, driven by higher retail gross margins.
Customer Acquisition Costs: In 2023, Via spent $6.7 million on customer acquisition costs, up from $5.9 million in 2022, indicating a strategic focus on expanding customer base.
Net Debt and Liquidity: At year-end 2023, Via had net debt of $54.4 million and total liquidity of $116 million, providing a solid financial foundation for future initiatives.
Shareholder Return Plan
Dividend Suspension: In April 19, 2023, Via made the decision to suspend the dividend on the common stock to strengthen the balance sheet and add financial flexibility.
Preferred Stock Dividend: On January 16, 2024, Via paid the quarterly cash dividend on its Series A preferred stock. A fourth quarter dividend of $0.7596 per share of preferred stock was announced to be paid on April 15, 2024.
Share Buyback Program: None
Key Q&A
Earnings Word Cloud
VIA Transcript
The earnings call summary highlights several positive factors: a promising partnership with Waymo, potential market expansion in Europe, and durable growth with margin expansion. The Q&A section did not reveal significant concerns, and management's optimistic outlook on autonomous vehicles and AI integration is encouraging. However, the decline in ARR per customer and lack of specific revenue projections temper the overall sentiment. Given these factors, the stock is likely to experience a positive movement in the short term, despite the absence of market cap data.
Despite positive financial growth, the suspension of common stock dividends to strengthen the balance sheet introduces uncertainty. The Q&A session did not reveal any management evasiveness, which is a positive aspect. However, increased expenses and the strategic decision to suspend dividends for flexibility and growth opportunities may concern investors, leading to a neutral stock price prediction.
VIA Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
