The following MD&A is a review of the financial condition and operating results of Just Energy for the three months and six months ended September 30, 2022. This MD&A should be read in conjunction with Just Energy's Interim Condensed Consolidated Financial Statements for the three months and six months ended September 30, 2022 and related notes (Part I, Item 1, "Interim Condensed Consolidated Financial Statements And Notes") and (ii) Consolidated Financial Statements for the year ended March 31, 2022 and related notes (Part II, Item 8, "Financial Statements and Supplementary Data") of the Annual Report. The financial information contained herein has been prepared in accordance with U.S. GAAP. All dollar amounts are expressed in US dollars unless otherwise noted. Quarterly reports, the Annual Report and supplementary information can be found on Just Energy's corporate website at investors.justenergy.com. Additional information can be found on SEDAR at www.sedar.com or on the SEC website at www.sec.gov.

COMPANIES' CREDITORS ARRANGEMENT AND CHAPTER 15 PROCEEDINGS

In February 2021, the State of Texas experienced the Weather Event. The Weather Event led to increased electricity demand and sustained high prices from February 13, 2021 through February 20, 2021. As a result of the losses sustained and without sufficient liquidity to pay the corresponding invoices from the ERCOT when due, and accordingly, on March 9, 2021, Just Energy applied for and received Court Orders under the CCAA from the Ontario Court and under Chapter 15 in the U.S. from the Houston Court. Protection under the Court Orders allows Just Energy to operate while it restructures its capital structure.

As part of the CCAA filing, the Company entered into a $125.0 million DIP Facility financing with certain affiliates of PIMCO (refer to Part I, Item 1, "Interim Condensed Consolidated Financial Statements And Notes", Note 9(a) Long-Term Debt and Financing). The Company also entered into qualifying support agreements with its largest commodity supplier and ISO services provider. The filings and associated DIP Facility arranged by the Company, enabled Just Energy to continue all operations without interruption throughout the U.S. and Canada and to continue making payments required by ERCOT and satisfy other regulatory obligations.

On September 15, 2021, the Ontario Court approved the Company's request to establish a claims process to identify and determine claims against the Company and its subsidiaries that are subject to the ongoing Claims Procedure Order. On August 18, 2022 the Ontario Court suspended the Claims Procedure Order with (i) the barring of claims pursuant to the applicable provisions of such order remaining in effect and (ii) the Company's ability, with the consent of the Monitor, to refer claims for adjudication for the purposes of determining entitlement to proceeds to be distributed in accordance with a transaction completed pursuant to the SISP. As part of item (ii) above, Just Energy may continue to review and determine which claims will be allowed, modified or disallowed, which may result in additional liabilities subject to compromise that are not currently reflected in the Interim Condensed Consolidated Financial Statements (refer to Part I, Item 1, "Interim Condensed Consolidated Financial Statements And Notes" Note 15(b) Commitments and Contingencies).

SALE AND INVESTMENT SOLICITATION PROCESS AND TRANSACTION

On August 4, 2022, the Company entered into the Transaction Agreement and the SISP Support Agreement in connection with the SISP to facilitate its exit from the CCAA proceedings as a going concern. On August 18, 2022, the Ontario Court granted an order, among other things, authorizing the Company to conduct the SISP. On October 17, 2022, the Company announced that the Transaction was the successful bid pursuant to the SISP.

On November 3, 2022, the Ontario Court issued an order (the "Reverse Vesting Order") that approved the Transaction contemplated by the Transaction Agreement.

The Just Energy Entities are seeking recognition of the Reverse Vesting Order in their Chapter 15 case in the Bankruptcy Court of the Southern District of Texas, Houston Division (the "Houston Court") on December 1, 2022.

Subject to the satisfaction or waiver of the other conditions to closing, upon the closing of the Transaction, the Purchaser will own all of the outstanding equity of Just Energy (U.S.) Corp., which will be the new parent company of all of the Just Energy Entities (other than those excluded pursuant to the terms of the Transaction Agreement), including the Company, and the Just Energy Entities will continue their business and operations in the ordinary course. All currently outstanding shares, options and other equity of Just Energy will be cancelled or redeemed for no consideration and without any vote or other action of the existing shareholders.



                                       7

  Table of Contents

Key terms of the Transaction include:

The purchase price payable pursuant to the Transaction is (i) $184.9 million in

cash, plus up to an additional CAD $10 million solely in the event that

additional amounts are required to make applicable payments pursuant to the

? Transaction Agreement; plus (ii) a credit bid of approximately $230 million

plus accrued interest of secured claims assigned to the Purchaser; plus (iii)

the assumption of Assumed Liabilities (as defined below), including up to CAD

$10 million owing under the Credit Facility (the "Credit Facility Remaining

Debt") to remain outstanding under an amended and restated credit agreement.

Applicable post-filing claims, the Credit Facility Remaining Debt, claims by

? energy regulators, and certain other liabilities enumerated in the Transaction

Agreement ("Assumed Liabilities") will continue to be liabilities of the Just

Energy Entities following consummation of the Transaction.

? Excluded liabilities and excluded assets of the Just Energy Entities will be

discharged from the Just Energy Entities pursuant to the Reverse Vesting Order.

The consummation of the Transaction is subject to satisfaction or waiver of a number of conditions precedent set forth in the Transaction Agreement including, among other things, receipt of all required regulatory approvals, and the recognition of such Reverse Vesting Order by the Houston Court. The outside date for completion of the Transaction is December 16, 2022, subject to extension in certain circumstances set forth in the Transaction Agreement.

Under the Transaction, no amounts will be available for distribution to the Just Energy Entities' general unsecured creditors, including the holders of Just Energy's $205.9 million Term Loan and the holders of Just Energy's 7.0% subordinated Notes Indenture, unless expressly classified as "Assumed Liabilities" pursuant to the Transaction Agreement. Liabilities that will not be retained, including the Term Loan and the Notes Indenture, will be transferred to newly formed corporations (the "ResidualCos"), along with excluded assets, under the Transaction Agreement. The Company expects that there will not be any recoveries available from the ResidualCos.

On November 3, 2022, the Ontario Court extended the stay until January 31, 2023. The stay extension allows the Company to continue to operate in the ordinary course of business while pursuing its proposed restructuring.

COMMON SHARES

On May 19, 2022, the common shares of the Company were transferred from the TSX Venture Exchange to the NEX and are trading under the symbol "JE.H.". The Company's common shares continue to trade on the OTC Pink Market under the symbol "JENGQ".

Implementation of the Transaction is subject to the condition that Just Energy, and the other Just Energy Entities, will have ceased to be a reporting issuer under any Canadian or U.S. securities laws, and that no Just Energy Entity will become a reporting issuer under any Canadian or U.S. securities laws as a result of completion of the Transaction. In connection with the completion of the Transaction, the Company intends to: (i) apply for an order from Canadian securities administrators that it will cease to be a reporting issuer under Canadian securities laws immediately prior to the effective date of the Transaction; and (ii) file to suspend its reporting obligations under U.S. securities laws. Additionally, the Company intends to submit an application to de-list its common shares from trading on the NEX on or before the closing of the Transaction. Concurrent with the delisting from the NEX, the Company expects that the common shares will cease trading on the OTC Pink Market.

WEATHER EVENT RELATED UPLIFT SECURITIZATION PROCEEDS

On June 16, 2021, HB 4492 became law in Texas. HB 4492 provides a mechanism for recovery of certain Weather Event Costs, incurred by various parties, including the Company, during the Weather Event, through certain securitization structures.

On October 13, 2021, the PUCT approved the Final Order authorizing the securitization of certain Weather Event Costs by ERCOT. On December 7, 2021, ERCOT filed its calculation with the PUCT in accordance with the PUCT Final Order implementing HB 4492. The Company received $147.5 million in June 2022.



                                       8

  Table of Contents

Forward-looking information

This MD&A may contain forward-looking statements, including, without limitation, statements with respect to timing for court approvals, applications to cease to be a reporting issuer and delist from exchanges and the anticipated timing to close the Transaction. These statements are based on current expectations that involve several risks and uncertainties which could cause actual results to differ from those anticipated. These risks include consummation of the Transaction and the anticipated results thereof; satisfaction of the conditions precedent to consummation of the Transaction, including approval thereof by the Houston Court and receipt of all required regulatory approvals; the ability of the Just Energy Entities to continue as a going concern following consummation of the Transaction; the outcome of any potential litigation with respect to the February 2021 extreme weather event in Texas; the outcome of any invoice dispute with the Electric Reliability Council of Texas, Inc.; the impact of the COVID-19 pandemic on the Company's business, operations and sales; the Company's ability to access sufficient capital to provide liquidity to manage its cash flow requirements; general economic, business and market conditions; the ability of management to execute its business plan; levels of customer natural gas and electricity consumption; extreme weather conditions; rates of customer additions and renewals; customer credit risk; rates of customer attrition; fluctuations in natural gas and electricity prices; interest and exchange rates; actions taken by governmental authorities including energy marketing regulation; increases in taxes and changes in government regulations and incentive programs; changes in regulatory regimes; results of litigation and decisions by regulatory authorities; competition; and dependence on certain suppliers. Additional information on these and other factors that could affect Just Energy's operations or financial results are included in Just Energy's Form 10K and other reports on file with the U.S. Securities and Exchange Commission which can be accessed at www.sec.gov and with the Canadian securities regulatory authorities which can be accessed through the SEDAR website at www.sedar.com or through Just Energy's website at investors.justenergy.com.

Company overview

Just Energy is a retail energy provider specializing in electricity and natural gas commodities, energy efficient solutions, carbon offsets and renewable energy options. Operating in the U.S. and Canada, Just Energy serves both residential and commercial customers, providing homes and businesses with a broad range of energy solutions that deliver comfort, convenience and control. Just Energy is the parent company of Amigo Energy, Filter Group, Hudson Energy, Interactive Energy Group, Tara Energy and Terrapass.



[[Image Removed: Graphic]]

Operations overview

MASS MARKETS SEGMENT

The Mass Markets segment includes customers acquired and served under the Just Energy, Tara Energy, Amigo Energy and Terrapass brands. Marketing of the energy products of this segment is primarily done through the digital and retail sales channels. Mass Market customers make up 72% of Just Energy's Base Gross Margin , which is currently focused on price-protected and flat-bill product offerings, as well as JustGreen products. To the extent that certain markets are better served by shorter-term or enhanced variable rate products, the Mass Markets segment's sales channels offer these products.

Just Energy also provides home water filtration systems with its line of consumer product and service offerings through Filter Group.

COMMERCIAL SEGMENT

The Commercial segment includes customers acquired and served under Hudson Energy, as well as brokerage services managed by Interactive Energy Group. Hudson Energy sales are made through three main channels: brokers, in-person commercial independent contractors and inside commercial sales representatives. Commercial customers make up 28% of Just Energy's Base Gross Margin. Products offered to Commercial customers range from standard fixed-price offerings



                                       9

Table of Contents

to "one off" offerings, tailored to meet the customer's specific needs. These products can be fixed or floating rate or a blend of the two, and normally have a term of less than five years. Base Gross Margin per RCE for this segment is lower than it is for the Mass Markets segment, but customer acquisition costs and ongoing customer care costs per RCE are lower as well. Commercial customers also have significantly lower attrition rates than Mass Markets customers.

ABOUT JUST ENERGY'S PRODUCTS

Just Energy offers products and services to address customers' essential needs, including electricity and natural gas commodities, energy efficient solutions, carbon offsets and renewable energy options as well as water quality and filtration devices.

Electricity

Just Energy services various states and territories in the U.S. and Canada with electricity. A variety of electricity solutions are offered, including fixed-price, flat-bill and variable-price products on both short-term and longer-term contracts. Most of these products provide customers with price-protection programs for the majority of their electricity requirements. Just Energy uses historical usage data for enrolled customers to predict future customer consumption and to help with long-term supply procurement decisions. Flat-bill products offer customers the ability to pay a fixed amount per period regardless of usage.

Just Energy purchases electricity supply from market counterparties for Mass Markets and Commercial customers based on forecasted customer aggregation. Electricity supply is generally purchased concurrently with the execution of a contract for larger Commercial customers. Historical customer usage is obtained from LDCs, which, when normalized to average weather, provides Just Energy with expected normal customer consumption. Just Energy mitigates exposure to weather variations through active management of the electricity portfolio and the purchase of options, including weather derivatives. Just Energy's ability to successfully mitigate weather effects is limited by the degree to which weather conditions deviate from normal and the availability and costs of such options. To the extent that balancing electricity purchases are outside the acceptable forecast, Just Energy bears the financial responsibility for excess or short supply caused by fluctuations in customer usage. Any supply balancing not fully covered through customer pass-throughs, active management or the options employed may increase or decrease Just Energy's Base Gross Margin depending upon market conditions at the time of balancing.

Natural gas

Just Energy offers natural gas customers a variety of products ranging from five-year fixed-price contracts to month-to-month variable-price contracts. Gas supply is purchased from market counterparties based on forecasted consumption. For larger Commercial customers, gas supply is generally purchased concurrently with the execution of a contract. Variable rate products allow customers to maintain flexibility while retaining the ability to lock into a fixed price at their discretion. Flat-bill products offer customers the ability to pay a fixed amount per period regardless of usage or changes in the price of the commodity.

The LDCs provide historical customer usage which, when normalized to average weather, enables Just Energy to purchase the expected normal customer consumption. Just Energy mitigates exposure to weather variations through active management of the gas portfolio, which involves, but is not limited to, the purchase of options, including weather derivatives. Just Energy's ability to successfully mitigate weather effects is limited by the degree to which weather conditions deviate from normal and the availability and costs of such options. To the extent that balancing requirements are outside the forecasted purchase, Just Energy bears the financial responsibility for fluctuations in customer usage. To the extent that supply balancing is not fully covered through active management or the options employed, Just Energy's Base Gross Margin may increase or decrease depending upon market conditions at the time of balancing.



                                       10

  Table of Contents

Territory                 Gas delivery method
Manitoba, Ontario, Quebec The volumes delivered for a customer typically remain
and Michigan              constant throughout the year. Revenues are not
                          recognized until the customer consumes the gas. During
                          the winter months, gas is consumed at a rate that is
                          greater than delivery, resulting in accrued gas
                          receivables, and, in the summer months, deliveries to
                          LDCs exceed customer consumption, resulting in gas
                          delivered in excess of consumption. Just Energy
                          receives cash from the LDCs as the gas is delivered.

Alberta, British The volume of gas delivered is based on the estimated Columbia, Saskatchewan, consumption and storage requirements for each month. California, Illinois, The amount of gas delivered in the months of October Indiana, Maryland, New to March is higher than in the months of April to Jersey, New York, Ohio September. Cash flow received from most of these and Pennsylvania markets is greatest during the fall and winter


                          quarters, as cash is normally received from the LDCs
                          in the same period as customer consumption.


JustGreen

Many customers have the ability to choose an appropriate JustGreen program to supplement their electricity and natural gas, providing an effective method to offset their carbon footprint associated with the respective commodity consumption.

JustGreen's electricity products offer customers the option of having all or a portion of the volume of their electricity usage sourced from renewable green sources such as wind, solar, hydropower or biomass, via power purchase agreements and renewable energy certificates. JustGreen programs for gas customers involve the purchase of carbon offsets from carbon capture and reduction projects. Additional green products allow customers to offset their carbon footprint without buying energy commodity products and can be offered in all states and provinces without being dependent on energy deregulation.

Just Energy currently sells JustGreen electricity and gas in eligible markets across North America. Of all Mass Market customers who contracted with Just Energy in the past year, 36% purchased JustGreen for some or all of their energy needs. On average, these customers elected to offset 100% of their consumption as green supply. For comparison, as reported for the trailing 12 months ended September 30, 2021, 40% of Mass Market customers who contracted with Just Energy chose to include JustGreen for an average of 73% of their consumption. As at September 30, 2022, JustGreen makes up 24% of the Mass Market electricity portfolio, compared to 25% in the year ago period. As at September 30, 2022, JustGreen makes up 25% of the Mass Market gas portfolio, compared to 17% in the year ago period.

Terrapass

Through Terrapass, customers can offset their environmental impact by purchasing high quality environmental products. Terrapass supports projects throughout North America and world-wide that destroy greenhouse gases, produce renewable energy and restore freshwater ecosystems. Each project is made possible through the purchase of carbon offsets, renewable energy credits and BEF Water Restoration Certificates®. Terrapass offers various purchase options for Mass Markets or Commercial customers, enabling businesses to incorporate seamless carbon offset options by providing marketing and product integration solutions.

Non-U.S. GAAP financial measures

Just Energy's Interim Condensed Consolidated Financial Statements are prepared in accordance with U.S. GAAP. The financial measures that are defined below do not have a standardized meaning prescribed by U.S. GAAP and may not be comparable to similar measures presented by other companies. These financial measures should not be considered as an alternative to, or more meaningful than, net income (loss), cash flow from operating activities and other measures of financial performance as determined in accordance with U.S. GAAP; however, the Company believes that these measures are useful in providing relative operational profitability of the Company's business.

BASE GROSS MARGIN

"Base Gross Margin" represents gross margin adjusted to exclude the effect of unrealized gains (losses) on derivative instruments and the one-time impact of the Weather Event. Base Gross Margin is a key measure used by management to assess performance and allocate resources. Management believes that the realized gains (losses) on derivative instruments reflect the long-term financial performance of Just Energy and thus have included them in the Base Gross Margin calculation.



                                       11

  Table of Contents

EBITDA

"EBITDA" refers to earnings before interest expense, income taxes, depreciation and amortization with an adjustment for discontinued operations. EBITDA is a non-U.S. GAAP measure that reflects the operational profitability of the business.

BASE EBITDA

"Base EBITDA" refers to EBITDA adjusted to exclude the impact of unrealized mark to market gains (losses) arising from U.S. GAAP requirements for derivative instruments, Reorganization Costs, Weather Event, share-based compensation, impairment of goodwill, intangible, inventory and others, gain on investment, realized gains (losses) related to gas held in storage until gas is sold, and non-controlling interest. This measure reflects operational profitability as the impact of the gain on investment, impairment of inventory and Reorganization Costs are one-time non-recurring events. Non-cash share-based compensation expense is treated as an equity issuance for the purposes of this calculation as it would be settled in Common Shares; and the unrealized mark to market gains (losses) are associated with supply already sold in the future at fixed prices.

Just Energy tries to ensure that customer margins are protected by entering into fixed-price supply contracts. Under U.S. GAAP, the customer contracts are not marked to market; however, there is a requirement to mark to market the future supply contracts. This creates unrealized and realized gains (losses) depending upon current supply pricing. Management believes that the unrealized mark to market gains (losses) do not impact the long-term financial performance of Just Energy and has excluded them from the Base EBITDA calculation.

Just Energy uses derivative instruments to hedge the gas held in storage for future delivery to customers. Under U.S. GAAP, the customer contracts are not marked to market: however, there is a requirement to report the realized gains (losses) in the current period instead of recognizing them as a cost of inventory until delivery to the customer. Just Energy excludes the realized gains (losses) to EBITDA during the injection season and includes them during the withdrawal season in accordance with the customers receiving the gas. Management believes that including the realized gains (losses) during the withdrawal season when the customers receive the gas is more reflective of the operations of the business.

Just Energy recognizes the incremental acquisition costs of obtaining a customer contract as an asset since these costs would not have been incurred if the contract was not obtained and are recovered through the consideration collected from the contract. Commissions and incentives paid for commodity contracts and value-added products contracts are capitalized and amortized over the term of the contract. Amortization of these costs with respect to customer contracts is included in the calculation of Base EBITDA (as selling commission expenses). Amortization of incremental acquisition costs on value-added product contracts is excluded from the Base EBITDA calculation as value-added products are considered to be a lease asset akin to a fixed asset whereby amortization or depreciation expenses are excluded from Base EBITDA.

FREE CASH FLOW AND UNLEVERED FREE CASH FLOW

Free cash flow represents cash flow from operations less maintenance capital expenditures. Unlevered free cash flow represents free cash flows plus interest expense excluding the non-cash portion.

EMBEDDED GROSS MARGIN ("EGM")

EGM is a rolling five-year measure of management's estimate of future contracted energy and product gross margin. The commodity EGM is the difference between existing energy customer contract prices and the cost of supply for the remainder of the term, with appropriate assumptions for commodity RCE attrition and renewals. The product gross margin is the difference between existing value-added product customer contract prices and the cost of goods sold on a five-year undiscounted basis for such customer contracts, with appropriate assumptions for value-added product attrition and renewals. It is assumed that expiring contracts will be renewed at target margin renewal rates.

EGM indicates the gross margin expected to be realized over the next five years from existing customers. It is intended only as a directional measure for future gross margin. It is neither discounted to present value nor is it intended to consider administrative and other costs necessary to realize this margin.



                                       12

Table of Contents

Financial and operating highlights

For the three months ended September 30.

(thousands of dollars, except where indicated and per share amounts)



                                                                     % increase
                                                      Fiscal 2023    (decrease)     Fiscal 2022
Revenue                                              $    684,968            22 %  $    559,382
Base Gross Margin1                                        113,569            23 %        92,442
Administrative expenses                                    29,934             0 %        29,816
Selling commission expenses                                21,132           (4) %        22,102
Selling non-commission and marketing expense               14,111             5 %        13,436
Provision for expected credit loss                         16,756           469 %         2,945
Reorganization Costs                                       26,951            83 %        14,746
Interest expense                                            8,921            15 %         7,754
Net Income (Loss) for the period                        (205,617)           NMF 2       265,081
Base EBITDA1                                               32,143            31 %        24,459
RCE Mass Markets count                                  1,266,000            10 %     1,149,000
RCE Mass Markets net adds                                  27,000           200 %         9,000
RCE Commercial count                                    1,530,000           (8) %     1,661,000

1 See "Non-U.S. GAAP financial measures" above.

2 Not a meaningful figure.

Revenue increased by 22% to $685.0 million for the three months ended September 30, 2022 compared to $559.4 million for the three months ended September 30, 2021. The increase was primarily driven by an increase in the Texas mass market customer base and warmer weather in Texas.

Base Gross Margin increased by 23% to $113.6 million for the three months ended September 30, 2022 compared to $92.4 million for the three months ended September 30, 2021. The increase was primarily driven by higher realized margins and growth in mass markets customer base.

Base EBITDA increased by 31% to $32.1 million for the three months ended September 30, 2022 compared to $24.5 million for the three months ended September 30, 2021. The increase was primarily driven by higher Base Gross Margin, partially offset by higher provision for expected credit loss.

Administrative expenses remained flat at $29.9 million for the three months ended September 30, 2022 compared to $29.8 million for the three months ended September 30, 2021.

Selling commission expenses decreased by 4% to $21.1 million for the three months ended September 30, 2022 compared to $22.1 million for the three months ended September 30, 2021. The decrease was primarily due to lower prepaid commission amortization from lower sales in prior years.

Selling non-commission and marketing expenses increased by 5% to $14.1 million for the three months ended September 30, 2022 compared to $13.4 million for the three months ended September 30, 2021. The increase was driven by investment in sales agent costs to drive customer additions and retention.

Provision for expected credit loss increased by 469% to $16.8 million for the three months ended September 30, 2022 compared to $2.9 million for the three months ended September 30, 2021. The increase was driven by regulatory requirements due to extended hot weather in Texas, as well as higher sales in Texas from an increase in the mass market customer base, and a release of reserves in the prior year.

Reorganization Costs include professional and advisory costs of $16.3 million, $0.5 million for the key employee retention plan and $10.1 million in prepetition claims, contract terminations and other costs.

Net loss was $205.6 million for the three months ended September 30, 2022 compared to net income of $265.1 million for the three months ended September 30, 2021. The net loss was driven by an unrealized mark to market loss on derivative instruments in the three months ended September 30, 2022. The net income in the three months ended September 30, 2021 was primarily driven by an unrealized mark to market gain on derivative instrument. The unrealized mark to market gains



                                       13

  Table of Contents

and losses on derivative financial instruments relate to the supply the Company has purchased to deliver in the future to existing customers at fixed contractual prices.

Mass Markets RCE Net Adds for the three months ended September 30, 2022 was a gain of 27,000 compared to a gain of 9,000 for the three months ended September 30, 2021 driven by the increase in customer additions.

Financial and operating highlights

For the six months ended September 30.

(thousands of dollars, except where indicated and per share amounts)



                                                                     % increase
                                                      Fiscal 2023    (decrease)     Fiscal 2022
Revenue                                              $  1,255,554            19 %  $  1,055,743
Base Gross Margin1                                        203,918            18 %       173,524
Administrative expenses                                    57,421             5 %        54,460
Selling commission expenses                                40,223           (6) %        42,750
Selling non-commission and marketing expense               27,492             9 %        25,124
Provision for expected credit loss                         27,206           202 %         9,018
Reorganization Costs                                       46,082            48 %        31,232
Interest expense                                           17,409             5 %        16,584
Net Income (Loss) for the period                         (45,003)           NMF 2       488,915
Base EBITDA1                                               52,616            22 %        43,229
Unlevered free cash flow1                                 146,542           338 %        33,470
EGM Mass Market                                           872,000             6 %       826,000
EGM Commercial                                            237,000          (11) %       265,500
RCE Mass Markets net adds                                  65,000           NMF 2         3,000

1 See "Non-U.S. GAAP financial measures" above.

2 Not a meaningful figure.

Revenue increased by 19% to $1,255.6 million for the six months ended September 30, 2022 compared to $1,055.7 million for the six months ended September 30, 2021. The increase was primarily driven by an increase in the Texas mass market customer base and warmer weather in Texas.

Base Gross Margin increased by 18% to $203.9 million for the six months ended September 30, 2022 compared to $173.5 million for the six months ended September 30, 2021. The increase was primarily driven by higher realized margins and growth in mass markets customer base.

Base EBITDA increased by 22% to $52.6 million for the six months ended September 30, 2022 compared to $43.2 million for the six months ended September 30, 2021. The increase was primarily driven by higher Base Gross Margin offset by higher provision for expected credit loss.

Administrative expenses increased by 5% to $57.4 million for the six months ended September 30, 2022 compared to $54.5 million to the six months ended September 30, 2021. The increase was primarily driven by higher employee costs and higher support cost driven by an increase in the Texas mass market customer base.

Selling commission expenses decreased by 6% to $40.2 million for the six months ended September 30, 2022 compared to $42.8 million for the six months ended September 30, 2021. The decrease was primarily due to lower prepaid commission amortization from lower sales in prior years.

Selling non-commission and marketing expenses increased by 9% to $27.5 million for the six months ended September 30, 2022 compared to $25.1 million for the six months ended September 30, 2021. The increase was driven by investment in sales agent costs to drive customer additions and retention.

Provision for expected credit loss increased by 202% to $27.2 million for the six months ended September 30, 2022 compared to $9.0 million for the six months ended September 30, 2021. The increase was driven by regulatory requirements due to extended hot weather in Texas, as well as higher sales in Texas from an increase in the mass market customer base, and a release of reserves in the prior year.

Reorganization Costs include professional and advisory costs of $29.9 million, $2.1 million for the key employee retention plan and $14.1 million in prepetition claims, contract terminations and other costs.



                                       14

Table of Contents

Interest expense increased by 5% to $17.4 million for the six months ended September 30, 2022 compared to $16.6 million for the six months ended September 30, 2021. The increase is due to higher interest rates on credit facility debt.

Unlevered free cash flow increased by $113.1 million to an inflow of $146.5 million for the six months ended September 30, 2022 compared to an inflow of $33.5 million for the six months ended September 30, 2021. The increase is primarily due to the proceeds from HB 4492

Mass Markets EGM increased by 6% to $872.0 million as at September 30, 2022 compared to $826.0 million as at September 30, 2021. The increase is primarily due to the increase in mass market customers.

Commercial EGM decreased by 11% to $237.0 million as at September 30, 2022 compared to $265.5 million as at September 30, 2021. The decline resulted from the decline in the customer base.

Base Gross Margin

For the three months ended September 30.

(thousands of dollars)



                                         Fiscal 2023                             Fiscal 2022
                   Mass                                     Mass
                 Market      Commercial        Total      Market      Commercial       Total
Gas            $  4,849    $      2,615    $   7,464    $  5,074    $        463    $  5,537
Electricity      74,972          31,133      106,105      63,567          23,338      86,905
               $ 79,821    $     33,748    $ 113,569    $ 68,641    $     23,801    $ 92,442
Increase            16%             42%          23%

For the six months ended September 30.



(thousands of dollars)

                                          Fiscal 2023                               Fiscal 2022
                    Mass                                      Mass
                  Market      Commercial        Total       Market      Commercial        Total
Gas            $  15,485    $      1,544    $  17,029    $  16,640    $      1,997    $  18,637
Electricity      132,242          54,647      186,889      113,066          41,821      154,887
               $ 147,727    $     56,191    $ 203,918    $ 129,706    $     43,818    $ 173,524
Increase             14%             28%          18%

1 See "Non-U.S. GAAP financial measures" above.

Mass Markets

Mass Markets Base Gross Margin increased by 16% to $79.8 million for the three months ended September 30, 2022 compared to $68.6 million for the three months ended September 30, 2021. The increase was primarily driven by higher mass market volumes due to increase in customer base.

Mass Markets Base Gross Margin increased by 14% to $147.7 million for the six months ended September 30, 2022 compared to $129.7 million for the six months ended September 30, 2021. The increase was primarily driven by higher mass market volumes due to increase in customer base.

Commercial

Commercial Base Gross Margin increased by 42% to $33.8 million for the three months ended September 30, 2022 compared to $23.8 million for the three months ended September 30, 2021. The increase was primarily driven by higher realized margins partially offset by lower customer base.

Commercial Base Gross Margin increased by 28% to $56.2 million for the six months ended September 30, 2022 compared to $43.8 million for the six months ended September 30, 2021. The increase was primarily driven by higher average realized margins partially offset by lower customer base.



                                       15

Table of Contents

Mass Markets average realized Base Gross Margin

For the trailing 12 months ended September 30.



                 Fiscal 2023                  Fiscal 2022
                 Base GM/RCE    % Change      Base GM/RCE
Gas            $         184        (34) %  $         277
Electricity              221         (9) %            244
Total          $         214        (15) %  $         252

Mass Markets average realized Base Gross Margin for the trailing 12 months ended September 30, 2022 decreased 15% to $214 compared to $252 for the trailing 12 months ended September 30, 2021. The decrease is primarily attributable to higher supply costs and competitive market pricing to support customer growth and retention.

Commercial average realized Base Gross Margin

For the trailing 12 months ended September 30.



                 Fiscal 2023                  Fiscal 2022
                 Base GM/RCE    % Change      Base GM/RCE
Gas            $          51        (14) %  $          59
Electricity              101          28 %             79
Total          $          90          20 %  $          75

Commercial average realized Base Gross Margin for the trailing 12 months ended September 30, 2022 increased 20% to $90 compared to $75 for the trailing 12 months ended September 30, 2021.



                                       16

Table of Contents

© Edgar Online, source Glimpses