Ormat Technologies Reports 2012 Second Quarter Results Quarterly revenues increased 24 percent to $129.8 million;

Q2 net income of $8.7 million

RENO, Nev., Aug. 1, 2012 /PRNewswire/ -- Ormat Technologies, Inc. (NYSE: ORA) today announced financial results for the second quarter of 2012.

(Logo: http://photos.prnewswire.com/prnh/20040422/LATH066LOGO)

Quarterly highlights and recent developments:

  • Total revenues increased 24 percent to $129.8 million
  • Cash flow from operations totals $30.2 million
  • Operating income increased 34 percent to $26.0 million
  • EBITDA of $50.8 million
  • Robust product backlog of $242 million as of August 1, 2012
  • 30MW McGinness Hills power plant in Nevada is operating at full power
  • Received $72.2 million cash grant for three projects 

Commenting on the results, Dita Bronicki, chief executive officer of Ormat, stated:  "We had a very good second quarter.  Total revenues increased 24 percent period-over-period. Operating income significantly improved. Our organic growth and improved operations results offset the impact of low natural gas prices on our energy rates under the SO#4 PPAs in California.

"We achieved a number of key milestones during the second quarter.  On the product side, we continued to win orders and strengthen our already robust backlog. In July, we announced the closing of a $61.4 million engineering, procurement and construction contract with Enel Green Power North America, maintaining our robust product backlog of $242 million. On the electricity side, we recently received off-taker approval of the commercial operation date for our Tuscarora power plant. In addition, we successfully completed the construction of the 30-MW McGinness Hills geothermal power plant demonstrating the strength of our vertically integrated structure to move from green field to production.  The 30 MW McGinness Hills power plant that is in full operation since June, increased the total generating capacity of our portfolio to 586 MW."

Financial Summary

Second Quarter Results

For the three months ended June 30, 2012, total revenues increased by 24.1 percent to $129.8 million from $104.6 million in the second quarter of 2011.  Product revenues almost doubled to $44.8 million, from $23.4 million in the three months ended June 30, 2011. Electricity revenues increased 4.7 percent to $85.0 million, up from $81.2 million in the three months ended June 30, 2011.

Operating income for the three months ended June 30, 2012 increased by $6.6 million to $26.0 million from $19.4 million for the three months ended June 30, 2011. The increase is principally attributed to lower maintenance costs in our electricity segment and higher revenues in our product segment due to the increase in new customer orders that were secured in 2011.

For the quarter, the company reported net income of $8.7 million, or $0.19 per share (basic and diluted), compared to $8.2 million, or $0.18 per share (basic and diluted), for the same quarter a year ago.

EBITDA for the second quarter of 2012 was $50.8 million, compared to $47.7 million for the same quarter last year. The reconciliation of GAAP net cash provided by operating activities to EBITDA and additional cash flows information is set forth below.

As of June 30, 2012, cash, cash equivalents and marketable securities were $71.9 million. In addition, as of June 30, 2012, the company has available, committed lines of credit with commercial banks aggregating $466.8 million, of which $64.8 million is unused.

On August 1, 2012, Ormat's Board of Directors approved the payment of a quarterly dividend of $0.04 per share pursuant to the company's dividend policy, which targets an annual payout ratio of at least 20 percent of the company's net income.  The dividend will be paid on August 23, 2012 to shareholders of record as of the close of business on August 14, 2012.  The company expects to pay a dividend of $0.04 per share in the next quarter.

Commenting on the outlook for 2012, Bronicki said, "We currently maintain our 2012 product revenues to be $165 to $175 million.  We narrow the range of our expected electricity forecast to be between $320 and $330 million."

Six-Month Results

For the six months ended June 30, 2012, total revenues increased 29.5 percent to $262.2 million from $202.4 million in the six months ended June 30, 2011. Net income for the period was $16.7 million, or $0.36 per share (basic and diluted), compared to net loss of $0.7 million, or $0.02 per share (basic and diluted), in the same period in 2011. The increase is principally attributable to the $29.2 million increase in operating income.

Product revenues more than doubled to $94.9 million, from $43.0 million in the six months ended June 30, 2011.  Electricity revenues increased 4.9 percent to $167.3 million, up from $159.5 million in the six months ended June 30, 2011.

EBITDA for the six months ended June 30, 2012 was $102.3 million, compared to $74.8 million for the same period last year. The reconciliation of GAAP net cash provided by operating activities to EBITDA and additional cash flows information is set forth below.

Conference Call Details

Ormat will host a conference call to discuss its financial results and other matters included in this press release at 10 a.m. EDT on Thursday, August 2, 2012.  The call will be available as a live, listen-only webcast at www.ormat.com. During the webcast, management will refer to slides that will be posted on the web site. The slides and accompanying webcast can be accessed through the Webcast & Presentations in the Investor Relations section of Ormat's website.

The webcast will be available approximately two hours after the conclusion of the live call. A replay will be available from 11 a.m. EDT on August 2, 2012. Please call: (855) 859-2056 (U.S. and Canada) (404) 537-3406 (International) and enter the replay code: 99938996.

About Ormat Technologies

Ormat Technologies, Inc. is the only vertically-integrated company primarily engaged in the geothermal and recovered energy power business. The company designs, develops, owns and operates geothermal and recovered energy-based power plants around the world. Additionally, the company designs, manufactures and sells geothermal and recovered energy power units and other power-generating equipment, and provides related services. The company has more than four decades of experience in the development of environmentally-sound power, primarily in geothermal and recovered-energy generation. Ormat products and systems are covered by 82 U.S. patents. Ormat has engineered and built power plants that it currently owns or has supplied to utilities and developers worldwide, totaling over 1,500 MW of gross capacity.  Ormat's current generating portfolio includes the following geothermal and recovered energy-based power plants: in the United States - Brady, Brawley, Heber, Jersey Valley, Mammoth, McGinness Hills, Ormesa, Puna, Steamboat, Tuscarora, OREG 1, OREG 2, OREG 3, and OREG 4; in Guatemala - Zunil and Amatitlan; in Kenya – Olkaria III; and, in Nicaragua - Momotombo.

Ormat's Safe Harbor Statement

Information provided in this press release may contain statements relating to current expectations, estimates, forecasts and projections about future events that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally relate to Ormat's plans, objectives and expectations for future operations and are based upon its management's current estimates and projections of future results or trends. Actual future results may differ materially from those projected as a result of certain risks and uncertainties. For a discussion of such risks and uncertainties, see "Risk Factors" as described in Ormat Technologies, Inc.'s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 29, 2012.

These forward-looking statements are made only as of the date hereof, and we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Ormat Technologies Contact:      

 Investor Relations Contact:

Dita Bronicki     

 Todd Fromer/Rob Fink

CEO       

 KCSA Strategic Communications

775-356-9029         

 212-896-1215 (Todd) /212-896-1206 (Rob)

dbronicki@ormat.com            

 tfromer@kcsa.com / rfink@kcsa.com

 

Ormat Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

For the Three and Six-Month Periods Ended June 30, 2012 and 2011

(Unaudited)






 Three Months Ended June 30, 


 Six Months Ended June 30, 


2012


2011


2012


2011


 (In thousands, except per share data) 


 (In thousands, except per share data) 

 Revenues: 












     Electricity

$

85,011


$

81,190


$

167,258


$

159,458

     Product


44,826



23,424



94,931



42,976

          Total revenues


129,837



104,614



262,189



202,434

 Cost of revenues: 












     Electricity


57,953



62,212



115,884



128,149

     Product


31,818



9,249



66,445



26,139

          Total cost of revenues


89,771



71,461



182,329



154,288

          Gross margin


40,066



33,153



79,860



48,146

 Operating expenses: 












     Research and development expenses


1,464



2,575



2,512



4,782

     Selling and marketing expenses


4,666



3,725



9,588



6,385

     General and administrative expenses


6,793



7,479



14,107



14,486

     Write-off of unsuccessful exploration

     activities


1,151





1,919



          Operating income


25,992



19,374



51,734



22,493

 Other income (expense): 












     Interest income


336



716



724



851

     Interest expense, net


(14,263)



(17,442)



(29,141)



(30,522)

     Foreign currency translation and

     transaction gains (losses)


(1,756)



596



(1,742)



1,113

     Income attributable to sale of tax

     benefits


2,589



3,141



5,106



5,280

     Other non-operating expense, net


290



915



129



118

           Income (loss), before income

           taxes and equity in  losses of

           investees


13,188



7,300



26,810



(667)

Income tax provision


(4,309)



1,007



(9,766)



421

Equity in losses of investees, net


(157)



(69)



(297)



(481)

          Net income (loss)


8,722



8,238



16,747



(727)

          Net income attributable to

          noncontrolling interest


(81)



(105)



(211)



(115)

          Net income (loss) attributable to

          the Company's stockholders

$

8,641


$

8,133


$

16,536


$

(842)













Earnings (loss) per share attributable to the Company's stockholders — basic and diluted:

$

0.19


$

0.18


$

0.36


$

(0.02)

Weighted average number of shares used in computation of earnings per share attributable to the Company's stockholders: 












     Basic


45,431



45,431



45,431



45,431

     Diluted


45,438



45,443



45,438



45,431

 

Ormat Technologies, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

As of June 30, 2012 and December 31, 2011

(Unaudited)








 June 30, 


 December 31, 



2012


2011




 (In thousands) 

 ASSETS 

 Current assets: 







     Cash and cash equivalents


$

66,684


$

99,886

     Marketable securities



5,221



18,521

     Restricted cash, cash equivalents and marketable securities



97,792



75,521

      Receivables: 







          Trade



42,315



51,274

          Related entity



329



287

          Other



8,064



9,415

     Due from Parent



161



260

     Inventories



18,119



12,541

     Costs and estimated earnings in excess of billings on uncompleted

     contracts



10,051



3,966

     Deferred income taxes



2,260



1,842

     Prepaid expenses and other



24,467



18,672

               Total current assets



275,463



292,185

Unconsolidated investments



3,783



3,757

Deposits and other



25,477



22,194

Deferred charges



39,711



40,236

Property, plant and equipment, net



1,560,127



1,518,532

Construction-in-process



325,206



370,551

Deferred financing and lease costs, net



27,188



28,482

Intangible assets, net



37,145



38,781

               Total assets


$

2,294,100


$

2,314,718

 LIABILITIES AND EQUITY 

 Current liabilities: 







     Accounts payable and accrued expenses


$

106,264


$

105,112

     Billings in excess of costs and estimated earnings on uncompleted

     contracts



25,272



33,104

     Current portion of long-term debt:







       Limited and non-recourse:







          Senior secured notes (non-recourse)



32,460



21,464

          Other loans



13,677



13,547

     Full recourse



20,647



20,543

               Total current liabilities



198,320



193,770

Long-term debt, net of current portion:







   Limited and non-recourse:







     Senior secured notes (non-recourse)



330,161



341,157

     Other loans



93,714



100,585

  Full recourse:







      Senior unsecured bonds



249,888



250,042

      Other loans



53,273



63,623

      Revolving credit lines with banks (full recourse)



203,369



214,049

Liability associated with sale of tax benefits



60,247



69,269

Deferred lease income



67,686



68,955

Deferred income taxes



59,755



54,665

Liability for unrecognized tax benefits



6,712



5,875

Liabilities for severance pay



20,857



20,547

Asset retirement obligation



22,118



21,284

Other long-term liabilities



3,789



4,253

               Total liabilities



1,369,889



1,408,074








 Equity: 







      The Company's stockholders' equity: 







          Common stock



46



46

          Additional paid-in capital



728,873



725,746

          Retained earnings



187,048



172,331

          Accumulated other comprehensive income



482



595




916,449



898,718

     Noncontrolling interest



7,762



7,926

          Total equity



924,211



906,644

          Total liabilities and equity


$

2,294,100


$

2,314,718

 

Ormat Technologies, Inc. and Subsidiaries

Reconciliation of EBITDA and Additional Cash Flows Information

For the Three and Six-Month Periods Ended June 30, 2012 and 2011

(Unaudited)


We calculate EBITDA as net income before interest, taxes, depreciation and amortization. EBITDA is not a measurement of financial performance or liquidity under accounting principles generally accepted in the United States of America and should not be considered as an alternative to cash flow from operating activities or as a measure of liquidity or an alternative to net earnings as indicators of our operating performance or any other measures of performance derived in accordance with accounting principles generally accepted in the United States of America. EBITDA is presented because we believe it is frequently used by securities analysts, investors and other interested parties in the evaluation of a company's ability to service and/or incur debt. However, other companies in our industry may calculate EBITDA differently than we do. The following table reconciles net cash provided by operating activities to EBITDA for the three and six-month periods ended June 30, 2012 and 2011:













 Three Months Ended June 30, 


 Six Months Ended June 30, 



2012


2011


2012


2011



 (in thousands) 


 (in thousands) 

Net cash provided by operating activities


$

30,205


$

26,440


$

72,079


$

39,506

Adjusted for:













Interest expense, net (excluding amortization

 of deferred financing costs)



13,082



16,528



26,729



28,824

Interest income



(336)



(716)



(724)



(851)

Income tax provision (benefit)



4,309



(1,007)



9,766



(421)

Adjustments to reconcile net income or loss to net cash provided by operating activities (excluding depreciation and amortization)



3,530



6,433



(5,575)



7,772

EBITDA


$

50,790


$

47,678


$

102,275


$

74,830

Net cash used in investing activities


$

(4,695)


$

(27,817)


$

(67,028)


$

(135,741)

Net cash provided by  financing activities


$

(43,406)


$

5,040


$

(38,253)


$

57,758

Depreciation and amortization


$

25,013


$

24,635


$

49,757


$

48,005

SOURCE Ormat Technologies, Inc.



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