The First Texas-Freeze Casualty: Just Energy Implodes, Issues Going Concern Warning
Just Energy’s shares crashed more than 21% in the premarket after the company released a statement about steep losses incurred during the winter storms that swept across Texas last week warning of doubts about remaining a ‘going concern’ (translation: it may not survive).
“The financial impact could change as additional information becomes available,” it said in the statement.
“Accordingly, the financial impact of the Weather Event on the Company once known, could be materially adverse to the Company’s liquidity and its ability to continue as a going concern.”
Just Energy hit a record low ($4.05) in premarket trading since it went public in 2002… and peaked above $600 in 2007.
The retail energy provider specializing in electricity and natural gas commodities, renewable energy options, and carbon offsets revealed that it lost $250 million due to Texas’s latest “weather event”.
“The sustained high prices from February 13, 2021 through February 19, 2021, during which real-time market prices were artificially set at USD $9,000/MWh for much of the week, it is likely that the Weather Event has resulted in a substantial negative financial impact to the Company.”
Based on current information available to the company as of the time of this press release, the company estimates that the financial impact of the Weather Event on the company could be a loss of approximately USD $250 million (approximately CAD $315 million), but the financial impact could change as additional information becomes available to the company,” Just Energy stated.
The company warned the material impact could cause “liquidity” issues and raises doubts it can continue operating. It’s currently talking with top stakeholders regarding the impact of the weather event last week.
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