Attached files
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| 8-K - FORM 8-K - ORMAT TECHNOLOGIES, INC. | ora20131106b_8k.htm |
Exhibit 99.1
PRESS RELEASE
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 Reports 2013 Third Quarter Results
Electricity revenues increased 14.7% to $89.0 million
Company raised revenue guidance for 2013
RENO, Nevada, November 5, 2013 -- Ormat Technologies, Inc. (NYSE: ORA) today announced financial results for the third quarter of 2013.
Quarterly financial highlights compared to the same quarter last year:
|
● |
Electricity revenue increased by 14.7% to $89.0 million; |
|
● |
Gross margin grew 75 basis points to 30.4%; |
|
● |
Operating income reached $29.8 million compared to $12.1 million; |
|
● |
Net income attributable to the Company’s shareholders was $13.0 million or $0.28 per share, compared to a net loss of $0.6 million or $0.01 per share; |
|
● |
Adjusted EBITDA grew 25.0% to $60.3 million; and |
|
● |
Declared dividend of $0.04 per share |
Operational highlights and recent developments:
|
● |
Increased electricity generation by 5.0% to 985,531 MWh, driven by new capacity coming on line at Olkaria III Plant 2 in Kenya, and increased generation at the McGuiness Hills plant; |
|
● |
Successfully completed the world’s largest binary geothermal plant, the 100 MW Ngatamariki in New Zealand, under a $142.0 million EPC contract; |
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● |
Secured a 10-year Power Purchase Agreement (PPA) with the Southern California Public Power Authority to supply power from the Heber 1 geothermal plant in California beginning December 16, 2015. The new PPA replaces the Standard Offer Contract No. 4 (SO#4), which is tied to natural gas prices, with fixed-price contract at a higher rate; |
|
● |
Entered into a joint development agreement with eBay to develop a 5 MW recovered energy generation power plant in Utah to supply cleaner electricity to eBay’s new data center; and |
|
● |
Signed an agreement for a greenfield development of the Hu’u Dompu geothermal prospect in Indonesia |
Dita Bronicki, Chief Executive Officer of Ormat, stated: “During the third quarter, we continued to deliver strong financial and operational results. In the electricity segment, we benefitted from the first full quarter of commercial operation of the Olkaria III Plant 2 in Kenya, which helped drive a 5.0% increase in generation. In addition, gross margin increased in the electricity segment to 31.1% due to the contribution of the new plants added to our portfolio in the past two years and to our continued focus on improving operational efficiencies at our existing plants. Looking ahead, we are poised to continue these positive trends and we aim to bring new capacity on line and replace legacy PPAs with more favorable agreements.”
“A substantial milestone in the product segment is the completion of the 100MW Ngatamariki geothermal power plant. The completion of the plant in less than 24 months from the award with generation at 104% of its designed output is a further testament to our execution capability and the suitability of our technology to large geothermal facilities. Looking forward, our backlog remains strong as we secured new orders in the third quarter 2013 and stands at approximately $173.0 million with more than $120.0 million expected to be recognized in 2014.”
Ms. Bronicki concluded, “We are raising our 2013 guidance and expect total revenue to be between $525.0 million to $535.0 million with electricity segment revenues to be approximately $330.0 million and product segment revenues to be between $195.0 million and $205.0 million.”
Financial Summary
For the three months ended September 30, 2013, total revenues reached $130.7 million from $132.3 million in the third quarter of 2012 a decrease of 1.2%. Electricity revenues increased 14.7% to $89.0 million from $77.6 million in the three months ended September 30, 2012. Product revenues decreased 23.6% to $41.8 million from $54.7 million in the three months ended September 30, 2012.
Operating income for the three months ended September 30, 2013 was $29.8 million, compared to $12.1 million for the three months ended September 30, 2012. Third quarter 2012 results included a $7.3 million impairment loss related to the OREG 4 recovered energy generation power plant.
For the three months ended September 30, 2013, the Company reported net income attributable to the Company’s shareholders of $13.0 million or $0.28 per share (diluted), compared to net loss of $0.6 million or $0.01 per share (diluted) for the three months ended September 30, 2012.
Adjusted EBITDA for the three months ended September 30, 2013 was $60.3 million, compared to $48.2 million for the three months ended September 30, 2012 an increase of 25.0%. The reconciliation of GAAP net cash provided by (used in) operating activities and net income to EBITDA and Adjusted EBITDA and additional cash flows information is set forth below in this release.
Net cash provided by operating activities was $32.2 million in the nine months ended September 30, 2013, compared to $62.4 million in the nine months ended September 30, 2012.
On November 5, 2013, ORMAT’s Board of Directors approved a payment of a quarterly dividend of $0.04 per share pursuant to the Company’s dividend policy, which targets an annual payoff ratio of at least 20% of the Company’s net income. The dividend will be paid on December 4, 2013 to shareholders of record as of closing of business on November 20, 2013.
As of September 30, 2013 cash, cash equivalents were $35.4 million. In addition, as of September 30, 2013, the company had $145.2 million of unused corporate borrowing capacity under existing lines of credit with different commercial banks.
Conference Call Details
Ormat will host a conference call to discuss its financial results and other matters discussed in this press release at 9:00 A.M. EST on Wednesday, November 6, 2013. 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.
An archive of the webcast will be available approximately 10 minutes after the conclusion of the live call.
About Ormat Technologies
With over four decades of experience, Ormat Technologies, Inc. is a leading geothermal company and the only vertically integrated company solely engaged in geothermal and recovered energy generation (REG). The company owns, operates, designs, manufactures and sells geothermal and REG power plants primarily based on the Ormat Energy Converter—a power generation unit that converts low-, medium- and high-temperature heat into electricity. With over 82 U.S. patents, Ormat's power solutions have been refined and perfected under the most grueling environmental conditions. Ormat has over 500 employees in the United States and about 600 overseas. Ormat's flexible, modular solutions for geothermal power and REG are ideal for the vast range of resource characteristics. The company has engineered, manufactured and constructed power plants, which it currently owns or has supplied to utilities and developers worldwide, totaling approximately 1600 MW of gross capacity. Ormat's current generating portfolio of 595 MW (net) is spread globally in the U.S., Guatemala and Kenya.
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 March 11, 2013.
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, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
For the Nine and Three-Month Periods Ended September 30, 2013 and 2012
(Unaudited)
Three Months Ended September 30 Nine Months Ended September 30 2013 2012 2013 2012 (In thousands, except per share data) (In thousands, except per share data) Revenues: Electricity Product Total revenues Cost of revenues: Electricity Product Total cost of revenues Gross margin Operating expenses: Research and development expenses Selling and marketing expenses General and administrative expenses Impairment charge Write-off of unsuccessful exploration activities Operating income Other income (expense): Interest income Interest expense, net Foreign currency translation and transaction gains (losses) Income attributable to sale of tax benefits Other non-operating expense, net Income before income taxes and equity in losses of investees * Income tax provision Equity in losses of investees, net Income (loss) from continuing operations Discontinued operations: Income from discontinued operations (including gain on disposal of $3,646, $0, $3,646 and $0, respectively) Income tax provision Total income from discontinued operations * Net income (loss) Net income attributable to noncontrolling interest Net income (loss) attributable to the Company's stockholders Earnings (losses) per share attributable to the Company's stockholders: Basic: Income (loss) from continuing operations Discontinued operations Net Income (loss) Diluted: Income (loss) from continuing operations Discontinued operations Net Income (loss) Weighted average number of shares used in computation of earnings per share attributable to the Company's stockholders: Basic Diluted * The "income tax provision" for the nine months ended September 30 2013 includes a correction of $3.1 million (increase) for the three-month period ended March 31, 2013 previously reported by the Company, and a corresponding reduction in net income.
$
88,994
$
77,612
$
245,005
$
238,837
41,755
54,685
157,329
149,616
130,749
132,297
402,334
388,453
61,356
59,924
175,085
172,785
29,637
42,130
110,335
108,575
90,993
102,054
285,420
281,360
39,756
30,243
116,914
107,093
838
1,436
3,446
3,948
2,575
3,346
17,861
12,752
6,546
6,132
20,264
20,163
7,264
—
7,264
—
—
—
1,919
29,797
12,065
75,343
61,047
742
280
870
1,004
(18,459
)
(15,400
)
(51,826
)
(44,541
)
1,258
615
3,844
(1,127
)
5,027
2,311
14,342
7,417
137
215
1,583
344
18,502
86
44,156
24,144
(5,201
)
(1,088
)
(15,028
)
(10,148
)
(158
)
(1,245
)
(149
)
(1,542
)
13,143
(2,247
)
28,979
12,454
—
2,123
5,311
4,875
—
(391
)
(614
)
(1,097
)
—
1,732
4,697
3,778
13,143
(515
)
33,676
16,232
(193
)
(67
)
(600
)
(278
)
$
12,950
$
(582
)
$
33,076
$
15,954
$
0.29
$
(0.05
)
$
0.62
$
0.27
-
0.04
0.10
0.08
$
0.29
$
(0.01
)
$
0.72
$
0.35
$
0.28
$
(0.05
)
$
0.62
$
0.27
-
0.04
0.10
0.08
$
0.28
$
(0.01
)
$
0.72
$
0.35
45,438
45,431
45,433
45,431
45,494
45,431
45,454
45,438
Ormat Technologies, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
As of September 30, 2013 and December 31, 2012
(Unaudited)
|
September 30, 2013 |
December 31, 2012 |
|||||||
|
As Revised |
||||||||
|
(In thousands) |
||||||||
|
ASSETS |
||||||||
|
Current assets: |
||||||||
|
Cash and cash equivalents |
$ | 35,435 | $ | 66,628 | ||||
|
Short-term bank deposit |
— | 3,010 | ||||||
|
Restricted cash, cash equivalents and marketable securities |
84,197 | 76,537 | ||||||
|
Receivables: |
||||||||
|
Trade |
60,526 | 55,680 | ||||||
|
Related entity |
442 | 373 | ||||||
|
Other |
24,643 | 8,632 | ||||||
|
Due from Parent |
373 | 311 | ||||||
|
Inventories |
20,396 | 20,669 | ||||||
|
Costs and estimated earnings in excess of billings on uncompleted contracts |
36,201 | 9,613 | ||||||
|
Deferred income taxes |
162 | 637 | ||||||
|
Prepaid expenses and other |
36,724 | 34,144 | ||||||
|
Total current assets |
299,099 | 276,234 | ||||||
|
Unconsolidated investments |
5,419 | 2,591 | ||||||
|
Deposits and other |
31,110 | 36,187 | ||||||
|
Deferred income taxes |
15,966 | 21,283 | ||||||
|
Deferred charges |
34,635 | 35,351 | ||||||
|
Property, plant and equipment, net |
1,383,353 | 1,252,873 | ||||||
|
Construction-in-process |
335,915 | 396,141 | ||||||
|
Deferred financing and lease costs, net |
29,806 | 31,371 | ||||||
|
Intangible assets, net |
33,032 | 35,492 | ||||||
|
Total assets |
$ | 2,168,335 | $ | 2,087,523 | ||||
|
LIABILITIES AND EQUITY |
||||||||
|
Current liabilities: |
||||||||
|
Accounts payable and accrued expenses |
$ | 83,751 | $ | 98,001 | ||||
|
Deferred income taxes |
20,428 | 20,392 | ||||||
|
Billings in excess of costs and estimated earnings on uncompleted contracts |
12,708 | 25,408 | ||||||
|
Current portion of long-term debt: |
||||||||
|
Limited and non-recourse: |
||||||||
|
Senior secured notes |
30,059 | 28,231 | ||||||
|
Other loans |
18,288 | 11,453 | ||||||
|
Full recourse |
28,875 | 28,649 | ||||||
|
Total current liabilities |
194,109 | 212,134 | ||||||
|
Long-term debt, net of current portion: |
||||||||
|
Limited and non-recourse: |
||||||||
|
Senior secured notes |
286,786 | 312,926 | ||||||
|
Other loans |
272,710 | 242,815 | ||||||
|
Full recourse: |
||||||||
|
Senior unsecured bonds |
250,674 | 250,904 | ||||||
|
Other loans |
64,414 | 82,344 | ||||||
|
Revolving credit lines with banks (full recourse) |
123,288 | 73,606 | ||||||
|
Liability associated with sale of tax benefits |
65,402 | 51,126 | ||||||
|
Deferred lease income |
64,217 | 66,398 | ||||||
|
Deferred income taxes |
52,233 | 45,059 | ||||||
|
Liability for unrecognized tax benefits |
8,878 | 7,280 | ||||||
|
Liabilities for severance pay |
23,642 | 22,887 | ||||||
|
Asset retirement obligation |
20,436 | 19,289 | ||||||
|
Other long-term liabilities |
4,576 | 5,148 | ||||||
|
Total liabilities |
1,431,365 | 1,391,916 | ||||||
|
Equity: |
||||||||
|
The Company's stockholders' equity: |
||||||||
|
Common stock |
46 | 46 | ||||||
|
Additional paid-in capital |
737,125 | 732,140 | ||||||
|
Retained earnings |
(13,066 | ) | (44,326 | ) | ||||
|
Accumulated other comprehensive income |
527 | 651 | ||||||
| 724,632 | 688,511 | |||||||
|
Noncontrolling interest |
12,338 | 7,096 | ||||||
|
Total equity |
736,970 | 695,607 | ||||||
|
Total liabilities and equity |
$ | 2,168,335 | $ | 2,087,523 | ||||
Ormat Technologies, Inc. and Subsidiaries
Reconciliation of EBITDA, Adjusted EBITDA and Additional Cash Flows Information
For the Nine and Three-Month Periods Ended September 30, 2013 and 2012
(Unaudited)
We calculate EBITDA as net income before interest, taxes, depreciation and amortization. We calculate Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, excluding impairment of long-lived assets and one-time termination fee. EBITDA and Adjusted EBITDA are 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 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 tables reconcile net cash provided by (used in) operating activities and net income to EBITDA and Adjusted EBITDA for the nine and three-month periods ended September 30, 2013 and 2012:
Three Months Ended September 30 Nine Months Ended September 30 2013 2012 2013 2012 (in thousands) (in thousands) Net cash provided by (used in) operating activities Adjusted for: Interest expense, net (excluding amortization of deferred financing costs) Interest income Income tax provision Adjustments to reconcile net income or loss to net cash provided by operating activities (excluding depreciation and amortization) EBITDA Impairment charge Termination fee Adjusted EBITDA Net cash provided by (used in) investing activities Net cash provided by (used in) financing activities
$
12,276
$
(9,695
)
$
32,226
$
62,384
17,405
14,202
47,367
40,931
(742
)
(280
)
(870
)
(1,004
)
5,201
1,479
15,642
11,245
26,115
35,236
72,361
29,661
$
60,255
$
40,942
$
166,726
$
143,217
—
7,264
—
7,264
—
—
8,979
—
$
60,255
$
48,206
$
175,705
$
150,481
$
(25,029
)
$
13,417
$
(128,198
)
$
(53,611
)
$
19,295
$
(32,882
)
$
64,779
$
(71,135
)
|
Three Months Ended September 30 |
Nine Months Ended September 30 |
|||||||||||||||
|
2013 |
2012 |
2013 |
2012 |
|||||||||||||
|
(in thousands) |
(in thousands) |
|||||||||||||||
|
Net income (loss) |
$ | 13,143 | $ | (515 | ) | $ | 33,676 | $ | 16,232 | |||||||
|
Adjusted for: |
||||||||||||||||
|
Interest expense, net (including amortization |
||||||||||||||||
|
of deferred financing costs) |
17,717 | 15,120 | 50,956 | 43,537 | ||||||||||||
|
Income tax provision |
5,201 | 1,479 | 15,642 | 11,245 | ||||||||||||
|
Depreciation and amortization |
24,194 | 24,858 | 66,452 | 72,203 | ||||||||||||
|
EBITDA |
$ | 60,255 | $ | 40,942 | $ | 166,726 | $ | 143,217 | ||||||||
|
Impairment charge |
— | 7,264 | — | 7,264 | ||||||||||||
|
Termination fee |
— | — | 8,979 | — | ||||||||||||
|
Adjusted EBITDA |
$ | 60,255 | $ | 48,206 | $ | 175,705 | $ | 150,481 | ||||||||