Published: August 03, 2011
Ormat Technologies Reports Second Quarter 2011 Results
RENO, Nev., Aug. 3, 2011 /PRNewswire/ -- Ormat Technologies, Inc. (NYSE: ORA) today announced financial results for the second quarter of 2011.
Quarterly highlights:
-- 18 percent increase in electricity revenues;
-- 11 percent increase in electricity generation; and
-- the largest product order which led to a record high backlog.
Commenting on the results, Dita Bronicki, Chief Executive Officer of Ormat, stated, "The second quarter was highlighted by strength in electricity operations. The good performance of most of our plants translated into growth in generation and in revenues from electricity, which increased to $81.2 million.
"We successfully secured new contracts for the supply of geothermal power plants and other power generating units. During the quarter we received a supply and engineering, procurement and construction (EPC) contract from New Zealand, which has a collective value of approximately $130 million. This represents the largest product order in our company's 46-year history, and, as a result, the product backlog increased to approximately $225 million.
"During the quarter, we also have made additional progress toward diversifying our future development portfolio by entering into a build, operate and transfer (BOT) agreement with Tikitere Geothermal Power Limited (TGL) to explore, develop, supply, construct, own and operate a 45 MW geothermal power plant in New Zealand."
Financial Summary
Second Quarter Results
For the three months ended June 30, 2011, total revenues were $104.6 million, compared to $96.3 million in the second quarter of 2010. Electricity revenues increased by 18.0 percent to $81.2 million, up from $68.8 million in the second quarter of 2010. Electricity revenues in the quarter include $4.8 million relating to our North Brawley power plant with corresponding cost of revenues of $10.4 million. Total generation increased by 11.2 percent and the average revenue rate of electricity operations was $83 per MWh, up from $78 per MWh in the second quarter of 2010. Product revenues for the three months ended June 30, 2011 were $23.4 million, compared to $27.5 million in the same period in 2010. Product revenues in the quarter include $7.9 million relating to an experimental REG plant in an LNG terminal in Spain.
For the quarter, the company reported net income of $8.2 million, or $0.18 per share (basic and diluted), compared to a net loss of $1.5 million, or $0.03 per share (basic and diluted) for the same period a year ago. The increase is principally attributable to the increase in the gross margins of both our electricity and product revenues.
Adjusted EBITDA for the second quarter of 2011 was $47.7 million, compared to $24.0 million in the same quarter last year. Adjusted EBITDA includes consolidated EBITDA and the company's share in the interest, taxes, depreciation and amortization related to its unconsolidated 50 percent interest in the Mammoth complex in California in the three months ended June 30, 2010. The reconciliation of GAAP net cash provided by operating activities to Adjusted EBITDA as well as additional cash flow information is set forth below.
As of June 30, 2011, cash, cash equivalents and marketable securities were $67.4 million. In addition, as of June 30, 2011, the company had available committed lines of credit with commercial banks aggregating $407.5 million, of which $196.0 million is unused.
On August 3, 2011, 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 25, 2011 to shareholders of record as of the close of business on August 16, 2011. The company expects to pay a dividend of $0.04 per share in the next quarter.
Commenting on the outlook for 2011, Bronicki said, "We continue to expect 2011 electricity revenues to total $315 to $325 million. We are maintaining our product revenues guidance to be $90 to $100 million."
Six-Month Results
For the six months ended June 30, 2011, total revenues were $202.4 million, an increase of 13.1 percent from $178.9 million in the same period last year. Net loss for the period was $0.7 million, or $0.02 per share (basic and diluted), compared to net income of $0.3 million, or $0.01 per share (basic and diluted), in the same period in 2010.
Electricity revenues for the six months ended June 30, 2011 were $159.5 million, compared to $134.9 million in the same period a year ago, an increase of 18.2 percent. Product revenues for the first six months of 2011 were $43.0 million, compared to $44.0 million in the same period in 2010, a decrease of 2.3 percent.
Adjusted EBITDA for the six months ended June 30, 2011 was $74.8 million, compared to $56.1 million for the same period a year ago. Adjusted EBITDA includes consolidated EBITDA and the company's share in the interest, taxes, depreciation and amortization related to its unconsolidated 50 percent interest in the Mammoth complex in California for the six months ended June 30, 2010. The reconciliation of GAAP net cash provided by operating activities to Adjusted EBITDA, as well as additional cash flow information is set forth below.
Conference Call Details
Ormat will host a conference call to discuss its financial results and other matters discussed in this press release at 10 a.m. EDT on Thursday, August 4, 2011. 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 IR events & Presentations in the Investor Relations section of Ormat's website.
The webcast replay will be available approximately two hours after the conclusion of the live call. A telephonic replay will be available from 1 p.m. EDT on August 4, 2011 through 11:59 p.m. EDT on August 11, 2011 by calling: (855) 859-2056 (U.S. and Canada) or (404) 537-3406 (International) and entering the reply code: 83311580.
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 80 U.S. patents. Ormat has engineered and built power plants, that it currently owns or has supplied to utilities and developers worldwide, totaling approximately 1370 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, Ormesa, Puna, Steamboat, 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 28, 2011.
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, 2011 and 2010
(Unaudited)
Three Months Ended
June 30,
------------------
2011 2010
---- ----
(In thousands, except
per share data)
Revenues:
Electricity $81,190 $68,807
Product 23,424 27,459
------ ------
Total revenues 104,614 96,266
------- ------
Cost of revenues:
Electricity 62,212 63,498
Product. 9,249 14,115
----- ------
Total cost of revenues 71,461 77,613
------ ------
Gross margin 33,153 18,653
Operating expenses:
Research and development expenses 2,575 3,614
Selling and marketing expenses 3,725 2,686
General and administrative expenses 7,479 6,996
Write-off of unsuccessful
exploration activities - 3,050
--- -----
Operating income 19,374 2,307
Other income (expense):
Interest income 716 95
Interest expense, net (17,442) (9,426)
Foreign currency translation and
transaction gains (losses) 596 (1,033)
Income attributable to sale of tax
benefits 3,141 2,070
Other non-operating income
(expense), net 915 79
--- ---
Income (loss) from continuing
operations, before income taxes
and equity in income (losses) of
investees 7,300 (5,908)
Income tax benefit 1,007 3,365
Equity in income (losses) of
investees, net (69) 479
--- ---
Income (loss) from continuing
operations 8,238 (2,064)
Discontinued operations:
Income from discontinued
operations, net of related tax - -
Gain on sale of a subsidiary in New
Zealand, net of related tax - 570
--- ---
Net income (loss) 8,238 (1,494)
Net loss (income) attributable to
noncontrolling interest (105) 57
---- ---
Net income (loss) attributable to
the Company's stockholders $8,133 $(1,437)
====== =======
Weighted average number of shares
used in computation of earnings
(loss) per share
attributable to the Company's
stockholders:
Basic 45,431 45,431
====== ======
Diluted 45,443 45,431
====== ======
Six Months Ended June
30,
---------------------
2011 2010
---- ----
(In thousands, except
per share data)
Revenues:
Electricity $159,458 $134,912
Product 42,976 44,008
------ ------
Total revenues 202,434 178,920
------- -------
Cost of revenues:
Electricity 128,149 118,021
Product. 26,139 26,552
------ ------
Total cost of revenues 154,288 144,573
------- -------
Gross margin 48,146 34,347
Operating expenses:
Research and development expenses 4,782 6,881
Selling and marketing expenses 6,385 5,888
General and administrative
expenses 14,486 14,016
Write-off of unsuccessful
exploration activities - 3,050
--- -----
Operating income 22,493 4,512
Other income (expense):
Interest income 851 292
Interest expense, net (30,522) (19,140)
Foreign currency translation and
transaction gains (losses) 1,113 (599)
Income attributable to sale of
tax benefits 5,280 4,209
Other non-operating income
(expense), net 118 (280)
--- ----
Income (loss) from continuing
operations, before income taxes
and equity in income (losses) of
investees (667) (11,006)
Income tax benefit 421 5,922
Equity in income (losses) of
investees, net (481) 1,025
---- -----
Income (loss) from continuing
operations (727) (4,059)
Discontinued operations:
Income from discontinued
operations, net of related tax - 14
Gain on sale of a subsidiary in
New Zealand, net of related tax - 4,336
--- -----
Net income (loss) (727) 291
Net loss (income) attributable to
noncontrolling interest (115) 110
---- ---
Net income (loss) attributable to
the Company's stockholders $(842) $401
===== ====
Weighted average number of shares
used in computation of earnings
(loss) per share
attributable to the Company's
stockholders:
Basic 45,431 45,431
====== ======
Diluted 45,431 45,431
====== ======
Ormat Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
As of June 30, 2011 and December 31, 2010
(Unaudited)
June 30, December 31,
2011 2010
---- ----
(In thousands)
ASSETS
Current assets:
Cash and cash equivalents $44,338 $82,815
Marketable securities 23,097 -
Restricted cash, cash equivalents
and marketable securities 28,713 23,309
Receivables:
Trade 72,185 54,495
Related entity 355 303
Other 7,795 8,173
Due from Parent 122 272
Inventories 14,408 12,538
Costs and estimated earnings in
excess of billings on uncompleted
contracts 570 6,146
Deferred income taxes 1,361 1,674
Prepaid expenses and other. 22,481 14,929
------ ------
Total current assets 215,425 204,654
Long-term marketable securities - 1,287
Restricted cash, cash equivalents
and marketable securities - 1,740
Unconsolidated investments 4,068 4,244
Deposits and other 22,989 21,353
Deferred income taxes 17,087 17,087
Deferred charges. 37,059 37,571
Property, plant and equipment, net 1,417,931 1,425,467
Construction-in-process. 337,969 270,634
Deferred financing and lease costs,
net 19,609 19,017
Intangible assets, net 38,676 40,274
------ ------
Total assets $2,110,813 $2,043,328
========== ==========
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued
expenses $76,607 $85,549
Billings in excess of costs and
estimated earnings on uncompleted
contracts 18,818 3,153
Current portion of long-term debt:
Limited and non-recourse 14,304 15,020
Full recourse 14,775 13,010
Senior secured notes (non-
recourse) 20,622 20,990
------ ------
Total current liabilities 145,126 137,722
Long-term debt, net of current
portion:
Limited and non-recourse 107,390 114,132
Full recourse:
Senior unsecured bonds 250,189 142,003
Other 75,920 84,166
Revolving credit lines with banks 151,461 189,466
Senior secured notes (non-
recourse) 203,382 210,882
Liability associated with sale of
tax benefits 78,519 66,587
Deferred lease income 70,010 71,264
Deferred income taxes 28,997 30,878
Liability for unrecognized tax
benefits 4,380 5,431
Liabilities for severance pay 22,565 20,706
Asset retirement obligation 20,684 19,903
Other long-term liabilities 4,473 4,961
----- -----
Total liabilities 1,163,096 1,098,101
--------- ---------
Equity:
The Company's stockholders' equity:
Common stock 46 46
Additional paid-in capital 722,522 716,731
Retained earnings 216,362 221,311
Accumulated other comprehensive
income 729 1,044
--- -----
939,659 939,132
Noncontrolling interest 8,058 6,095
----- -----
Total equity 947,717 945,227
------- -------
Total liabilities and equity $2,110,813 $2,043,328
========== ==========
Ormat Technologies, Inc. and Subsidiaries
Reconciliation of EBITDA and Adjusted EBITDA and Additional Cash
Flows Information
For the Three and Six-Month Periods Ended June 30, 2011 and 2010
(Unaudited)
We calculate EBITDA as net income before interest, taxes,
depreciation and amortization. We calculate adjusted EBITDA to
include depreciation and amortization, interest and taxes
attributable to our equity investments in the Mammoth complex.
EBITDA and adjusted EBITDA are not measurements 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 and
adjusted EBITDA are presented because we believe they are 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
and adjusted EBITDA differently than we do. The following table
reconciles net cash provided by operating activities to EBITDA and
adjusted EBITDA, for the three and six- month periods ended June
30, 2011 and 2010:
Three Months Ended
June 30,
------------------
2011 2010
---- ----
(in thousands)
Net cash provided by operating
activities $26,440 $10,694
Adjusted for:
Interest expense, net (excluding
amortization of deferred
financing costs) 16,528 8,754
Interest income (716) (95)
Income tax benefit (1,007) (3,935)
Adjustments to reconcile net
income to net cash provided by
operating activities (excluding
depreciation and amortization) 6,433 7,692
----- -----
EBITDA 47,678 23,110
Interest, taxes, depreciation and
amortization attributable to the
Company's equity interest in
Mammoth-Pacific L.P. - 939
--- ---
Adjusted EBITDA $47,678 $24,049
======= =======
Net cash used in investing
activities $(27,817) $(44,033)
======== --------
Net cash provided by financing
activities $5,040 $44,423
====== =======
Depreciation and amortization $24,635 $19,880
======= =======
Six Months Ended June
30,
---------------------
2011 2010
---- ----
(in thousands)
Net cash provided by operating
activities $39,506 $58,934
Adjusted for:
Interest expense, net (excluding
amortization of deferred
financing costs) 28,824 17,775
Interest income (851) (292)
Income tax benefit (421) (3,916)
Adjustments to reconcile net
income to net cash provided by
operating activities (excluding
depreciation and amortization) 7,772 (18,314)
----- -------
EBITDA 74,830 54,187
Interest, taxes, depreciation and
amortization attributable to the
Company's equity interest in
Mammoth-Pacific L.P. - 1,912
--- -----
Adjusted EBITDA $74,830 $56,099
======= =======
Net cash used in investing
activities $(135,741) $(109,014)
--------- ---------
Net cash provided by financing
activities $57,758 $57,968
======= =======
Depreciation and amortization $48,005 $40,329
======= =======
SOURCE Ormat Technologies, Inc.
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