RENO, Nev., Nov. 4 /PRNewswire-FirstCall/ -- Ormat Technologies, Inc. today announced financial results for the third quarter of 2009.
(Logo: http://www.newscom.com/cgi-bin/prnh/20040422/LATH066LOGO) Third Quarter Results
For the three-month period ended September 30, 2009, total revenues were $119.8 million, an increase of 20.2% from $99.7 million in the third quarter of 2008, consisting of a 65.5% increase in Product Segment revenues and flat Electricity Segment revenues.
For the quarter, the Company reported net income of $23.4 million, or $0.52 per share of common stock (basic and diluted), compared to $15.8 million, or $0.35 per share of common stock (basic and diluted), for the same period a year ago, which represents an increase of 48.1%. The increase in net income is primarily attributable to our Product Segment.
Commenting on the quarter''s results, Dita Bronicki, Chief Executive Officer of Ormat, stated: "As in previous quarters of this year, we continued to benefit from the significant increase in revenue from our Product Segment resulting from the record backlog that we had at the beginning of 2009. We expect revenue from this segment to return to previous levels in 2010 with a corresponding reduction in margins.
Generation in our Electricity Segment continued to grow. Year-over-year our total U.S. and international generation for the quarter was up 19% to about 799,000 MWh. We continued to add land to our exploration portfolio and secured new lease agreements covering approximately 2,300 acres in California and Nevada."
Electricity revenues for the third quarter of 2009 were $68.7 million, consistent with the third quarter of 2008. Revenues in our electricity segment this quarter were impacted by a decline in the average revenue rate from $103 to $86 per MWh due to the effect of lower oil prices on the Puna power plant''s energy rates.
Revenues from the Product Segment for the three-month period ended September 30, 2009 were $51.1 million, compared to $30.9 million in the same quarter in 2008, an increase of 65.5%. The increase in product sales was primarily attributable to EPC contracts for the construction of three large binary geothermal projects in Nevada, New Zealand and Costa Rica.
Adjusted EBITDA in the third quarter of 2009 increased 30.8% to $50.3 million compared to $38.5 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 the Company''s unconsolidated 50% interest in the Mammoth complex in California. As further described in "Reconciliation of EBITDA and Adjusted EBITDA and Additional Cash Flows Information" below, we changed the method for calculating EBITDA and adjusted EBITDA beginning in the third quarter of 2009.
Cash and cash equivalents as of September 30, 2009 decreased to $20.3 million from $34.4 million as of December 31, 2008. In addition, as of November 4, 2009, we have available unused bank lines of credit and other borrowing capacity aggregating $412.5 million of which $218.7 million is unused.
On November 4, 2009, Ormat''s Board of Directors approved the payment of a quarterly cash dividend of $0.06 per share pursuant to the Company''s dividend policy, which targets an annual payout ratio of at least 20% of the Company''s net income, subject to Board approval. The dividend will be paid on December 1, 2009 to shareholders of record as of the close of business on November 18, 2009.
Commenting on the outlook for 2009, Ms. Bronicki said, "With regard to our Electricity Segment, following our third quarter earnings results, we are narrowing the range as we currently expect electricity segment revenues for 2009 to be between $254 and $258 million. We also expect an additional $9 million of revenue from our share of electricity revenue generated by a subsidiary, which is accounted for under the equity method. Given our Product Segment results for the third quarter, we are increasing our guidance and expect revenues in this segment to be approximately $150 million."
Ms. Bronicki concluded, "It has been a productive quarter and year thus far for Ormat. We have weathered the economic uncertainty with sound results and substantial liquidity, and we are encouraged by our position over the long term. Our priority going forward remains on investing for the long-term, moving forward with our exploration activities and continuing to add the land and funding necessary to continue to our growth."
Nine-Month Results
For the nine-month period ended September 30, 2009, total revenues increased 28.3% to $320.0 million, compared to $249.3 million for the nine months ended September 30, 2008. Net income for the period was $53.9 million, or $1.19 per share of common stock (basic and diluted), compared to $37.9 million, or $0.87 per share of common stock (basic and diluted) for the same period last year, which represents an increase of 42.3% in net income.
Revenues attributable to our Electricity Segment for the nine months ended September 30, 2009 were $191.9 million, consistent with the same period last year. Product Segment revenues for the nine months ended September 30, 2009 were $128.0 million, an increase of 116.3%, compared to $59.2 million for the nine months ended September 30, 2008.
Adjusted EBITDA for the nine month period ended September 30, 2008 increased 25.2% to $127.5 million compared to $101.8 million in same period last year. Adjusted EBITDA includes consolidated EBITDA and the Company''s share in the interest, taxes, depreciation and amortization related to the Company''s unconsolidated 50% interest in the Mammoth complex in California. As further described in "Reconciliation of EBITDA and Adjusted EBITDA and Additional Cash Flows Information" below, we changed the method for calculating EBITDA and adjusted EBITDA beginning in the third quarter of 2009.
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. U.S. E.S.T. on Thursday, November 5, 2009. The call will be available as a live, listen-only webcast at http://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 Event Calendar in the Investor Relations section of Ormat''s website.
A 30-day archive of the webcast will be available approximately 2 hours after the conclusion of the live call. A replay will be available from Noon EST on November 5, 2009 through 11:59 p.m. EST, November 112 2008. Please call: (800) 642-1687 (U.S. and Canada) or (706) 645-9291 (International) and enter the code 37808458.
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 75 U.S. patents. Ormat has built over approximately 1,200 MW of plants half for its own account and half as supplies to utilities and developers. Ormat current generating portfolio includes the following geothermal and recovered energy-based power plants: in the United States - Brady, Heber, Mammoth, Ormesa, Puna, Steamboat, OREG 1, OREG 2 and Peetz; in Guatemala - Zunil and Amatitlan; in Kenya - Olkaria III; in Nicaragua - Momotombo and in New Zealand - GDL.
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 2, 2009.
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.
For Immediate Release Ormat Technologies Contact: Investor Relations Contact Dita Bronicki Todd Fromer / Marybeth Csaby CEO KCSA Strategic Communications 775-356-9029 212-896-1215 / 212-896-1236 dbronicki@ormat.com tfromer@kcsa.com / mcsaby@kcsa.com Ormat Technologies, Inc. and Subsidiaries Condensed Consolidated Statements of Operations For the Three and Nine-Month Periods Ended September 30, 2009 and 2008 (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, ------------------- ------------------ 2009 2008 (1) 2009 2008 (1) ---- ---------- ---- ---------- (in thousands, (in thousands, except per share except per share amounts) amounts) Revenues: Electricity $68,715 $68,837 $191,915 $190,130 Product 51,113 30,889 128,037 59,204 ------ ------ ------- ------ Total revenues 119,828 99,726 319,952 249,334 ------- ------ ------- ------- Cost of revenues: Electricity 44,394 44,742 133,236 124,924 Product 35,780 23,730 87,265 47,484 ------ ------ ------ ------ Total cost of revenues 80,174 68,472 220,501 172,408 ------ ------ ------- ------- Gross margin 39,654 31,254 99,451 76,926 Operating expenses: Research and development expenses 3,863 1,894 7,151 3,375 Selling and marketing expenses 3,393 2,647 10,909 8,186 General and administrative expenses 6,437 7,587 19,554 19,539 ----- ----- ------ ------ Operating income 25,961 19,126 61,837 45,826 Other income (expense): Interest income 157 637 585 2,735 Interest expense, net (4,358) (3,017) (12,063) (12,654) Foreign currency translation and transaction gains (losses) 1,320 (1,028) 1,329 (2,570) Income attributable to sale of equity interests 3,869 4,995 12,403 13,159 Other non-operating income (expense), net 246 (2,066) 646 (2,045) --- ------ --- ------ Income before income taxes and equity in income of investees 27,195 18,647 64,737 44,451 Income tax provision (4,340) (3,187) (12,307) (7,871) Equity in income of investees, net 591 372 1,496 1,319 --- --- ----- ----- Net income 23,446 15,832 53,926 37,899 Net loss attributable to noncontrolling interest 80 79 236 237 -- -- --- --- Net income attributable to the Company''s stockholders $23,526 $15,911 $54,162 $38,136 ======= ======= ======= ======= Earnings per share attributable to the Company''s stockholders- basic and diluted $0.52 $0.35 $1.19 $0.87 ===== ===== ===== ===== Weighted average number of shares used in computation of earnings per share attributable to the Company''s stockholders: Basic 45,413 45,337 45,379 43,782 ====== ====== ====== ====== Diluted 45,564 45,483 45,477 43,921 ====== ====== ====== ====== (1) Amounts have been reclassified to reflect the implementation of the new accounting guidance for noncontrolling interests in consolidated financial statements. Ormat Technologies, Inc. and Subsidiaries Condensed Consolidated Balance Sheets As of September 30, 2009 and December 31, 2008 (Unaudited) September 30, December 31, 2009 2008 (1) ---- ---------- (in thousands) Assets Current assets: Cash and cash equivalents $20,343 $34,393 Restricted cash, cash equivalents and marketable securities 60,846 24,439 Receivables: Trade 55,332 49,839 Related entities 478 338 Other 19,981 15,654 Due to Parent 1,059 1,085 Inventories 14,193 13,724 Costs and estimated earnings in excess of billings on uncompleted contracts 23,955 6,982 Deferred income taxes 2,864 3,003 Prepaid expenses and other 10,286 16,222 ------ ------ Total current assets 209,337 165,679 Long-term marketable securities 2,057 1,994 Restricted cash, cash equivalents and marketable securities 2,981 2,951 Unconsolidated investments 34,219 30,559 Deposits and other 18,738 16,876 Deferred income taxes 14,006 13,965 Property, plant and equipment, net 971,316 958,186 Construction-in-process 514,205 386,501 Deferred financing and lease costs, net 22,116 19,240 Intangible assets 42,507 44,853 ------ ------ Total assets $1,831,482 $1,640,804 ========== ========== Liabilities and Equity Current liabilities: Accounts payable and accrued expenses $77,423 $103,336 Billings in excess of costs and estimated earnings on uncompleted contracts 5,494 15,670 Current portion of long-term debt: Limited and non-recourse 20,024 6,676 Full recourse 2,824 - Senior secured notes (non-recourse) 19,943 20,085 Due to Parent, including current portion of notes payable to Parent 9,834 16,616 ----- ------ Total current liabilities 135,542 162,383 Long-term debt, net of current portion: Limited and non-recourse 136,031 7,814 Full recourse 37,176 - Revolving credit lines with banks (full recourse) 112,000 100,000 Senior secured notes (non-recourse) 244,588 252,060 Notes payable to Parent - 9,600 Liability associated with sale of equity interests 106,641 113,327 Deferred lease income 73,254 74,427 Deferred income taxes 44,524 33,231 Liability for unrecognized tax benefits 4,079 3,425 Liabilities for severance pay 18,461 17,640 Asset retirement obligation 14,226 13,438 ------ ------ Total liabilities 926,522 787,345 ------- ------- Equity: The Company''s stockholders'' equity: Common stock 46 45 Additional paid-in capital 706,616 701,273 Retained earnings 191,210 144,465 Accumulated other comprehensive income 293 645 --- --- 898,165 846,428 Noncontrolling interest 6,795 7,031 ----- ----- Total equity 904,960 853,459 ------- ------- Total liabilities and equity $1,831,482 $1,640,804 ========== ========== (1) Amounts have been reclassified to reflect the implementation of the new accounting guidance for noncontrolling interests in consolidated financial statements. Ormat Technologies, Inc. and Subsidiaries
Reconciliation of EBITDA and Adjusted EBITDA and Additional Cash Flows Information
(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 nine-month periods ended September 30, 2009 and 2008:
Three Months Ended Nine Months Ended September 30, September 30, ---------------- --------------- 2009 2008 2009 2008 ---- ---- ---- ---- (in thousands) (in thousands) Net cash provided by operating activities $22,364 $40,273 $77,696 $89,897 Adjusted for: Interest expense, net (excluding amortization of deferred financing costs) 4,074 2,712 10,201 11,741 Interest income (157) (637) (585) (2,735) Income tax provision 4,340 3,187 12,307 7,871 Adjustments to reconcile net income to net cash provided by operating activities (excluding depreciation and amortization) 18,683 (7,963) 25,024 (7,680) ------ ------ ------ ------ EBITDA 49,304 37,572 124,643 99,094 Interest, taxes, depreciation and amortization attributable to the Company''s equity in Mammoth-Pacific L.P. 1,020 899 2,843 2,736 ----- --- ----- ----- Adjusted EBITDA $50,324 $38,471 $127,486 $101,830 ======= ======= ======== ======== Net cash used in investing activities $(90,479) $(136,325) $(248,881) $(303,702) ======== ========= ========= ========= Net cash provided by (used in) financing activities $42,400 $(3,572) $156,919 $204,721 ======= ======= ======== ========
We previously calculated EBITDA to exclude equity income of investees and other non-operating expense (income) and adjusted EBITDA to exclude other non-operating expense (income). The change in the way we now calculate EBITDA and adjusted EBITDA results in higher EBITDA and adjusted EBITDA for each of the periods shown above than we would have reported using our prior method for calculating EBITDA and adjusted EBITDA. The following table shows, for each period reported above, the differences in our reported EBITDA and adjusted EBITDA resulting from the change in our method for computing these amounts.
Three Months Ended Nine Months Ended September 30, September 30, ---------------- ---------------- 2009 2008 2009 2008 ---- ---- ---- ---- (in thousands) (in thousands) EBITDA, as previously calculated $43,278 $35,299 $108,769 $89,231 Adjusted for inclusion: Equity in income of investees 591 372 1,496 1,319 Other non-operating income 5,435 1,901 14,378 8,544 ----- ----- ------ ----- EBITDA, as currently calculated $49,304 $37,572 $124,643 $99,094 ======= ======= ======== ======= Adjusted EBITDA, as previously calculated $44,889 $36,570 $113,108 $93,286 Adjusted for inclusion: Other non-operating income 5,435 1,901 14,378 8,544 ----- ----- ------ ----- Adjusted EBITDA, as currently calculated $50,324 $38,471 $127,486 $101,830 ======= ======= ======== ========
This comparative non-GAAP information is provided to assist investors in evaluating the impact of the change in the way we calculate these amounts in performing their financial analysis of our operations for the periods presented. This information should not be considered in isolation or as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP or other non-GAAP financial measures.
In addition, we now reconcile EBITDA and adjusted EBITDA to our net cash provided by operating activities for each of the periods shown, rather than net income amounts we have used for reconciliation in prior periods. Accordingly, the information in the tables above is not directly comparable to similar reconciliation information we have reported for prior periods not reflected in the tables above.
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Ormat Technologies, Inc.
CONTACT: Dita Bronicki, CEO of Ormat Technologies, +1-775-356-9029,
dbronicki@ormat.com; or Investor Relations, Todd Fromer, +1-212-896-1215,
tfromer@kcsa.com, or Marybeth Csaby, +1-212-896-1236, mcsaby@kcsa.com, both of
KCSA Strategic Communications, for Ormat Technologies
Web Site: http://www.ormat.com/
