Ormat Technologies Reports 2012 Second Quarter Results

Quarterly revenues increased 24 percent to $129.8 million;

Q2 net income of $8.7 million

01 Aug, 2012, 21:52 ET from Ormat Technologies, Inc.

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.



RELATED LINKS

http://www.ormat.com