Ormat Technologies, Inc. · NYSE:ORA
Ormat Technologies — Q1 2017 Earnings Presentation
25 slides from Ormat Technologies's earnings presentation, May 9, 2017
Slide 1: Ormat Technologies, Inc. First Quarter 2017 Earnings Call
Ormat Technologies, Inc. First Quarter 2017 Earnings Call May 9, 2017 Green energy you can rely on Copyright © 2017 Ormat Technologies, Inc.
Slide 2: Disclaimer
Disclaimer Information provided during this presentation 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 sta
Slide 3: Agenda
Agenda • First Quarter 2017 prepared remarks • Q1 2017 highlights: Isaac Angel, CEO • Financial overview: Doron Blachar, CFO • Operations & business updates: Isaac Angel, CEO • Q&A 3 Copyright © 2017 Ormat Technologies, Inc.
Slide 4: Q1 2017 Highlights
Q1 2017 Highlights ($ millions, except per share amounts) Q1 -17 Q1 -16 Change Revenues Electricity $115.8 $107.9 7.3% Product $74.1 $43.7 69.5% Total Revenues $189.9 $151.6 25.3% Gross profit $74.4 $63.9 16.5% Operating income $59.5 $50.5 17.7% Net income attributable to the Company’s stockholders
Slide 5: Q1 2017 Highlights
Q1 2017 Highlights • ORIX will acquire 22% ownership stake in Ormat from FIMI, Bronicki Investments, and senior members of management • Enter into strategic partnership with Ormat • Closing is expected in the third quarter of 2017 • ORIX is one of Asia’s leading investors in the renewable energy sec
Slide 6: Financial Results
Financial Results Doron Blachar, CFO Green energy you can rely on 6 Copyright © 2017 Ormat Technologies, Inc.
Slide 7: Total Revenues
Total Revenues Total Revenues Total Cost of Revenues Segment Contribution +38.3 million (25.3%) +27.8 million (31.7%) $189.9 $151.6 29% 39% $115.5 $87.7 61% 71% Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Electricity Segment Product Segment All amounts in million USD 7 Copyright © 2017 Ormat Tec
Slide 8: Electricity Segment
Electricity Segment Revenues Cost of Revenues +$7.9 million (7.3%) +$2.4 million (3.7%) $115.8 $107.9 $63.7 $66.0 Q1 2016 Q1 2017 Q1 2016 Q1 2017 • The consolidation of the Bouillante power plant in • Additional cost of revenues from the consolidation Guadeloupe, effective July 5, 2016, with revenue
Slide 9: Product Segment
Product Segment Revenues Cost of Revenues +$30.4 million (69.5%) +$25.4 million (105.7%) $74.1 $43.7 $49.5 $24.0 Q1 2016 Q1 2017 Q1 2016 Q1 2017 • Start of revenue recognition from two new geothermal projects in New Zealand and China that we started to construct in the Q1 2017 • Approximately $17.0
Slide 10: Gross Margin
Gross Margin Combined Electricity Segment Product Segment 43.0% 45.0% 42.1% 41.0% 39.2% 33.3% Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 2016 Q1 2017 • Increase due to higher efficiency • Decrease due to a different product in some of our operating power mix and different margins in the plants various sales
Slide 11: Operating Income
Operating Income Total Electricity Segment Product Segment +$9.0 million (17.7%) +$6.1 million (17.6%) +$2.8 million (18.0%) $59.5 $50.5 $40.9 $34.8 $15.8 $18.6 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 2016 Q1 2017 All amounts in million USD 11 Copyright © 2017 Ormat Technologies, Inc.
Slide 12: Net Income Attributable to the Company's Stockholders & EPS
Net Income Attributable to the Company's Stockholders & EPS Net Income Attributable to the Earnings per Share (Diluted)1 Company's Stockholders $35.3 $29.3 $0.70 $0.59 Q1 2016 Q1 2017 Q1 2016 Q1 2017 All amounts in million USD; 1. Weighted average number of shares used in computation of earnings per
Slide 13: Adjusted EBITDA
Adjusted EBITDA Total Electricity Segment Product Segment +$11.6 million (14.4%) +$9.2 million (14.7%) +$2.4 million (13.5%) 91.8 80.2 71.9 62.6 17.6 20.0 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1 2016 Q1 2017 Q1-16 Q1-17 Q1-16 Q1-17 Q1-16 Q1-17 D&A 24.3 25.5 D&A 23.4 24.7 D&A 0.9 0.8 All amounts in millio
Slide 14: Cash and Cash Equivalents
Cash and Cash Equivalents $52.9 $71.5 $35.3 $30.0 $25.6 $230.2 $14.9 $13.4 $8.4 $6.8 $0.3 $174.1 December 31, Proceeds from Cash from Capital Viridity Net change in Unconsolidated Debt Dividend Cash paid to Other March 31, 2016 revolving credit operating expenditures acquisition restricted cash inve
Slide 15: Payment of Principal Due by Period
Payment of Principal Due by Period The average interest rate for the total debt is 5.0% Q2-2017 Q3-2017 Q4-2017 FY 2017 Long-term non-recourse debt & limited recourse debt 6 5 6 17 Senior Secured Notes (non-recourse) due 2033 10 3 13 26 Long-term loans (full recourse) 4 2 4 10 Total $20 $10 $23 $53
Slide 16: Operations & Business Updates
Operations & Business Updates Isaac Angel, CEO Green energy you can rely on 16 Copyright © 2017 Ormat Technologies, Inc.
Slide 17: Generation
Generation • Generation increased by 2.2% in Q1 2017 from Q1 2016 • Increase in generation at the Puna power plant, Hawaii • Consolidation of the Bouillante power plant, Guadalupe (July 5, 2016) Generation (million MWh) Bouillante Geothermal Power plant in Guadalupe 5.40 5.43 4.84 4.25 4.45 Olkaria
Slide 18: Product Segment
Product Segment • Backlog of approximately $207.0 million as of May 8, 2017 • Includes revenues for the period between April 1, 2017 and May 8, 2017 • Signed new contracts for a total of $30 million • We expect overall lower margin for the products segment compared to previous years 18 Copyright © 2
Slide 19: Future Growth
Future Growth • Expanding geographical footprint and diversifying technologies • 2016 - added 44 MW from Olkaria III, Kenya & Bouillante, Guadeloupe • March 2017 - added 14 MW from SIL, the first unit of the 330MW Sarulla geothermal project in Indonesia • Expect to add between 200MW and 210MW by YE
Slide 20: Energy Storage
Energy Storage • March 15, 2017 - closed the acquisition of substantially all the business and assets of Viridity Energy, Inc. for $35 million • Viridity acquisition - a platform to develop and expand opportunities in the energy storage market 20 Copyright © 2017 Ormat Technologies, Inc.
Slide 21: Capital Needs for the Remainder of 2017
Capital Needs for the Remainder of 2017 Capital Needs (millions) $125 Construction & enhancements $25 Development $30 Maintenance CapEx $14 Exploration $3 Production facility $197 Total CapEx $53 Debt repayment $250 Total 21 Copyright © 2017 Ormat Technologies, Inc.
Slide 22: 2017 Guidance
2017 Guidance • We are reiterating our 2017 full-year guidance: • 2017 revenues guidance between $680 million and $700 million • Electricity Segment - between $460 million and $470 million • Product Segment - between $220 million and $230 million • Adjusted EBITDA 2017 guidance: • Between $340 milli
Slide 23: Q&A
Q&A Green energy you can rely on Copyright © 2017 Ormat Technologies, Inc.
Slide 24: Reconciliation of EBITDA, Adjusted EBITDA and Additional Cash Flows Information
Reconciliation of EBITDA Adjusted EBITDA and Additional Cash Flows Information Ormat Technologies, Inc. and Subsidiaries Reconciliation of EBITDA, Adjusted EBITDA and Additional Cash Flows Information for the Three Month Periods Ended March 31, 2017 and 2016 (Unaudited) We calculate EBITDA as net in
Slide 25: Reconciliation of EBITDA, Adjusted EBITDA and Additional Cash Flows Information
Reconciliation of EBITDA Adjusted EBITDA and Additional Cash Flows Information Three Months Ended March 31 2017 2016 (in thousands) Net income .............................................................................................................................................................