Genie Energy Ltd. Issues Restatement Warning on Previous Financials, Citing Material Errors and Control Weaknesses

Key Points for Investors:

• Genie Energy Ltd. (NYSE: GNE) has announced that investors should no longer rely on previously issued financial statements for 2023 and 2024, as well as quarterly statements for 2024 and 2025.
• The company discovered material errors related to its captive insurance subsidiary, resulting in significant misstatements affecting cash, restricted cash, deferred tax assets, income taxes, and insurance liabilities.
• Restatement is expected to significantly increase previously reported net income and income from operations for both 2023 and 2024.
• Material weaknesses in internal controls over financial reporting have been identified, and the company has declared that its internal controls were not effective as of December 31, 2025.
• The company’s prior independent auditor, Zwick CPA, PLLC, had its registration revoked by the PCAOB, requiring Genie Energy to re-audit its 2023 and 2024 financials.
• Genie Energy will file for an extension to submit its comprehensive 2025 10-K, which will include restated results and unaudited information for impacted periods.

Details of the Financial Restatement

On March 9, 2026, Genie Energy Ltd.’s Audit Committee, in consultation with management, concluded that multiple previous financial statements should not be relied upon due to errors with the accounting for the liability associated with its captive insurance subsidiary. These errors led to material misstatements in:

• Cash and cash equivalents
• Restricted cash (short-term and long-term)
• Deferred income tax assets, net
• Income taxes payable
• Captive insurance liabilities (current and noncurrent)
• Provision for captive insurance liability
• Provision for income taxes

These items affected both the balance sheets and statements of operations, resulting in understatements of income from operations and net income for the periods in question.

The company stated that all earnings and press releases tied to the affected periods, along with the audit reports from its prior independent accounting firm, should also not be relied upon.

Magnitude of the Restatement

During the audit of consolidated financial statements for 2023, 2024, and 2025, Genie Energy identified the need for a restatement. Preliminary estimates indicate that the restated financials will increase previously reported results as follows:

• 2023:
  • Income from Operations: +\$45.1 million
  • Provision for Income Taxes: +\$12.4 million
  • Net Income: +\$32.7 million
• 2024:
  • Income from Operations: +\$33.6 million
  • Provision for Income Taxes: +\$10.7 million
  • Net Income: +\$22.9 million

These figures are preliminary and subject to change as the company’s review is ongoing.

Audit Firm Revocation and Internal Control Weaknesses

Genie Energy is required to re-audit its 2023 and 2024 financial statements because its previous auditor, Zwick CPA, PLLC, had its registration revoked by the Public Company Accounting Oversight Board (PCAOB). This revocation means that the prior audits and their reports are now invalid for SEC reporting purposes.

Additionally, management has identified material weaknesses in the company’s internal controls over financial reporting, leading to the conclusion that such controls were not effective as of December 31, 2025. The company is taking steps to remediate these weaknesses and will provide more details in the upcoming comprehensive 10-K.

Filing Delays and Next Steps

Genie Energy expects to file a Form 12b-25 with the SEC by March 16, 2026, to request a 15-day extension for filing its comprehensive 2025 10-K. The 10-K will include restated audited results for 2023 and 2024, as well as restated unaudited information for all affected quarters. The company does not plan to file separate amended annual or quarterly reports for these periods.

Ongoing internal reviews may uncover additional errors, potentially leading to further delays. The company’s Audit Committee and management have discussed these issues with its current independent auditors, CBIZ CPAs P.C.

Implications for Shareholders and Potential Share Price Impact

• This announcement is highly price sensitive and could significantly impact Genie Energy’s share price. Investors should be aware that previously issued financial statements can no longer be relied upon and that the company’s internal controls have been found deficient.
• The restatement will increase previously reported net income and income from operations for both 2023 and 2024, which could be a positive catalyst for the share price if concerns about controls are adequately addressed.
• However, the disclosure of material weaknesses and the need to re-audit due to auditor revocation introduce uncertainty and governance concerns, which may weigh negatively on the stock in the near term.
• Investors are urged to monitor subsequent filings and the comprehensive 10-K for final restatement details and further updates on remediation efforts.

Forward-Looking Statements

This report contains forward-looking statements regarding the company’s restatement process, remediation of internal controls, and anticipated changes to financial results. Actual results may differ materially due to risks and uncertainties, including additional errors that may be identified and the company’s ability to remediate control weaknesses.

Disclaimer: This article summarizes and interprets material information disclosed by Genie Energy Ltd. in its recent SEC Form 8-K filing and related exhibits. The article is for informational purposes only, does not constitute investment advice or a recommendation, and may include forward-looking statements subject to risks and uncertainties. Readers are encouraged to review all SEC filings and consult with a professional advisor before making any investment decisions. The author and publisher assume no liability for actions taken based on this content.

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