Good morning, and welcome to Genie Energy's First Quarter 2018 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation by Genie Energy’s Management will be an opportunity to ask questions. [Operator Instructions] In this presentation, Genie Energy's management team will discuss financial and operational results for the three-month period ended March 31, 2018. 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, which is a non-GAAP measure. Generally, a non-GAAP financial measure is a numerical measure of a Company's performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measures calculated and presented in accordance with GAAP. Management believes that Genie Energy's adjusted EBITDA provides useful information to both management and investors by excluding certain expenses that may not be indicative of Genie Energy's or the relevant segment's core operating results. Adjusted EBITDA should be considered in addition to, not as a substitute for or superior to, gross profit, income or loss from operations, cash flow from operating activities, net income or loss, basic and diluted earnings or loss per share or other measures of liquidity and financial performance prepared in accordance with GAAP. The Genie Energy earnings release, including a reconciliation of adjusted EBITDA to net income, is available on the Investor Relations page of the Genie Corporate website, www.genie.com. The earnings release has also been filed on a Form 8-K with the SEC. Please note, this event is being recorded. I would 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 First Quarter 2018 Earnings Call. Avi Goldin, our Chief Financial Officer, has joined me for today's call. This morning, we will review our operational and financial results for the three-month period ended March 31, 2018. I'll kick off the call with an update on our strategic and operational progress and Avi will discuss the quarter's financial results. When Avi is finished, we will be glad to take your questions. Now turning to our results. Genie Retail Energy performed extremely well again this quarter, generating over $10 million in income from operations and adjusted EBITDA while continuing to execute on our strategic priorities, including domestic and international geographic expansion. At Afek, we received some intriguing results from the analysis of the data generated at our Ness 10 exploratory well. Now let's look at Genie Retail Energy's operational highlights. Gross meter acquisitions in the first quarter decreased to 55,000 from 84,000 in the year-ago quarter and 52,000 in the fourth quarter of 2017 as a result of our decision to refocus customer acquisition on lower risk, higher customer value territories. Our return rate was 7.9% in the quarter compared to 6.1% in the year-ago quarter and 6.9% in the fourth quarter of last year. However, this quarter's churn rate includes the impact of the return of our low-income customers in New York State, mandated of all retail energy providers by the New York Public Service Commission. Exclusive of the impact of these return customers, the churn rate during the first quarter would have been 6.8%. While we are on the topic, the New York PSC is also continuing to study the competitive landscape in New York, although the timing and ultimate content of any additional order remain uncertain. On a positive note, New York's highest…

Thank you, Michael. And thanks to everyone on the call for joining us this morning. My remarks today cover our financial results for the first quarter of 2018 for the three-month period ended March 31. Except where I indicate otherwise, all first quarter results are compared to the first quarter 2017. Consistent with prior quarters, I will focus on the year-over-year rather than sequential comparisons to remove from consideration the seasonal fluctuations that are characteristics of our retail energy business. This was an excellent quarter financially for Genie Energy led by a strong contribution from our Genie Retail business. Our bottom line also benefited from the suspension of drilling activities at Afek, helping to boost EPS to $0.24 per share from $0.18 in the year-ago quarter. Working capital at the end of the quarter increased over $40 million. In the first quarter, Genie Retail Energy, once again, generated all of Genie Energy's revenue, direct cost of revenues and gross profits. Genie retail's first quarter revenue increased to $89.3 million from $71.4 million, and commodity sale prices and total per meter consumption increased for both electricity and natural gas. Genie retail's gross margin percentage declined just 27.4% from 34.8% margin in the year-ago quarter. Margins decreased for both electricity, to 28.1% from 36.4%, and natural gas, to 24.8% from 29.2%, as the underlying cost of both electricity and natural gas rose more quickly than our revenue per unit sold. The impact of the decreases in gross margin percentage were significantly offset by higher commodity sale prices and the increases in kilowatt hours in therms sold that consolidated gross profit decreased by just $400,000 from $24.5 million. Note that in the quarter, we adjusted the accrual that we had made in the second quarter of 2017 for the settling of our class…

[Operator Instructions] And today's first question comes from Anthony Marchese, a Private Investor. Please go ahead.

Yes, good morning, guys. Congratulations. It's nice to see the increase in earnings. A couple of – well, one big question. You have a fair amount of cash. I'm not sure if you bought any stock back this quarter. But if you didn't, could you explain why not? And if you could explain your acquisition strategy – I get, for the year – power business, electrical business – electric or gas business over the next 12 months to 24 months?

Thank you, Anthony. This is Avi Goldin. On the question about buybacks, we have not done anything recently. As you're probably aware, we do have an authorization and it is something that we constantly do monitor at both the board level and the management levels, what the right decision is about use of cash as you question. As we look at things today, we're very excited about the growth prospects that we have in terms of both acquisitions organically and potentially through additional acquisitions. So we are comfortable with our cash position, but we are actively monitoring both share price and all other factors, as we think about the best way to deliver value.

And could you just share with us your – given the precipitous drop, I would call it, in share price, what your plans are for investor outreach?

Yes. Tony, it's Mike. We've definitely been – started to get a little bit more active now that our story has become a little bit clearer in shareholders, with most of the money coming in from the retail business. We either are going to support reinvestment in the retail business or money going out to shareholders and the building of our balance sheet. We certainly and we continue talking to investors and be more active than we've been in the past. We are currently looking at different options in terms of companies and outreach professionals to help us with that effort. It's a constantly evolving process.

All right. Thank you.

And ladies and gentlemen, our next question comes from Aaron Shafter of Great Mountain Capital Management.

My question relates to Afek and the drilling at the Ness 10. Can you expand a little bit upon, both what the outside consultant found exactly? And also what – if you got any kind of time line when you expect to get a new license, how difficult that will be, and when you would commence new operations. So wanted.

Aaron, thanks for the question. So this was a pretty late-breaking development before this call. It actually happened after the quarter had already ended, really just about 1.5 weeks ago that we kind of got the sign of results from one of the top auditing firms. I can't share the name, but one of the top oil and gas auditing firms in the world working for all the majors. And they basically came in and said, there seems to be evidence of hydrocarbons and it would warrant a little bit more testing in order to see if those hydrocarbons are in commercially viable oil. So at their suggestion, we've decided to go out and talk to the ministry to try to renew the license, really just that area specifically, the well where we'll be doing the testing. It's not more drilling, it's just that between that already well, and renew the license area immediately surrounding it, in case we see good results from that test. But we don't know when we're going to get the renewal and if we're going to get the renewal. But if we can get the renewal, and when we get the renewal, we will start to work immediately. We cannot expect it to be a huge amount of spend. We're talking somewhere in the neighborhood of $0.5 million to $1 million. It is certainly the responsible thing to do, given the potential that we've always felt was there, and given the reaction by those auditors.

So what type of testing are you talking about? You're talking about in-pressure test or something else?

That's still being defined. At this time, right now, we don't have the commission to go back in. But once – if we're able to secure that, we'll be able, then be able to do a sort of full-blown project plan for it. But we don't have anything – we don't have the types of tests defined at this time.

What we know for sure – and again, we can already see wells, so it will not be nearly – it won't be as expensive as starting from scratch, and we will not be drilling as we've been doing in the past, which has been kind of responsible for most of the spend, that affect.

Any type of timetable on when you would expect a yes, or no from the ministry about the renewal of the license?

Yes, we have not gotten a firm answer on that. All we've done is approach them, tell them our plans and they've accepted those plans. And I should think once we deal with more documentation and again, this is a very late-breaking development, really all of the last bit we can have.

Okay. That’s all my questions. End of Q&A

[Operator Instructions] This concludes our question-and-answer session and today's conference call. We thank you for attending today's presentation. You may now disconnect your lines, and have a wonderful day.