Ormat Technologies, Inc. · NYSE:ORA

Ormat Technologies — Q4 2020 Earnings Presentation

35 slides from Ormat Technologies's earnings presentation, Feb 25, 2021

Slide 1: Ormat Technologies, Inc. Earnings Call
ORMAT TECHNOLOGIES, INC. EARNINGS CALL DORON BLACHAR, CEO ASSI GINZBURG, CFO FEBRUARY 25, 2021 Copyright © Copyright 2021 Ormat © 2021 Ormat Technologies, Technologies, Inc. Inc.
Slide 2: Safe Harbor Statement and Non-GAAP Metrics
SAFE HARBOR STATEMENT AND NON-GAAP METRICS THIS PRESENTATION INCLUDES FORWARD-LOOKING STATEMENTS, AND THE DISCLAIMER SHOULD BE READ CAREFULLY FORWARD-LOOKING STATEMENTS This presentation, and information provided during any discussion accompanying this presentation, These forward-looking statements
Slide 3: 2020 Highlights
2020 HIGHLIGHTS DELIVERED SOLID DEMONSTRATED COMMITTED TO CONTINUED TO DRIVE FINANCIAL PERFORMANCE BUSINESS RESILIENCE A SUSTAINABLE FUTURE PROFITABLE GROWTH Copyright © 2021 Ormat Technologies, Inc. 3
Slide 5: Solid Financial Performance
SOLID FINANCIAL PERFORMANCE FY 20 Revenues Gross margin Adjusted EBITDA(1) EPS/Adjusted EPS(1,2,3) $705.3M 39.2% $420.2M $1.65 (5.5%) +310 bps +9.3% (4.1%)/13.0% Q4 20 Revenues Gross margin Adjusted EBITDA(1) EPS(2) $179.4M 41.8% $109.2M $0.39 (6.8%) +310 bps +6.9% +62.5% (1) For key financial resul
Slide 6: Revenues by Segment
REVENUES BY SEGMENT FY 20 Total Electricity Products Storage 77% 21% $705.3 $541.4M $148.1M $15.8M Electricity Products (5.5%) +0.2% (22.5%) +7.6% 2% Storage Q4 20 Total Electricity Products Storage 82% 15% $179.4 $146.2M $27.4M $5.8M Electricity Products (6.8%) +1.3% (37.5%) +36.2% 3% Storage Copyr
Slide 7: Gross Margin by Segment
GROSS MARGIN BY SEGMENT FY 20 Storage Total Electricity Products 39.2% 44.6% 22.4% 11.1% +310 bps +250 bps -120 bps NA Q4 20 Total Electricity Products Storage 41.8% 45.2% 29.8% 13.0% +310 bps +160 bps +160 bps NA Copyright © 2021 Ormat Technologies, Inc. 7
Slide 8: Adjusted EBITDA by Segment
ADJUSTED EBITDA(1) BY SEGMENT FY 20 Total Electricity Products Storage 92% 7% $420.2 $388.6M $28.4M $3.2M Electricity Products +9.3% +10.6% (15.7%) NA 1% Storage Q4 20 Total Electricity Products Storage 90% 9% $109.2 $97.8M $9.7M $1.7M Electricity Products +6.9% +5.4% 3.4% NA 1% Storage (1) For key
Slide 9: YE 2020 Cash and Cash Equivalents and Restricted Cash
YE 2020 - CASH AND CASH EQUIVALENTS AND RESTRICTED CASH ($M) 193 342 Net Investment borrowing (1) in CapEx 340 & others Proceeds from Public 43 offering 23 5 $537 Pomona acquisition Dividend Other 265 Cash from operating activities $153 DEC. 31, 2019 DEC. 31, 2020 $759M $340M $290M $128M SUCCESSFUL
Slide 11: Ormat Demonstrated It's Resilient in a Challenging and Volatile Environment
ORMAT DEMONSTRATED IT’S RESILIENT IN A CHALLENGING AND VOLATILE ENVIRONMENT OPERATION PUNA HAWAII KENYA PRODUCT SEGMENT STORAGE UPDATE Copyright © 2021 Ormat Technologies, Inc. 11
Slide 12: Electricity Operation
ELECTRICITY OPERATION Global portfolio reached 932 MW Main generating capacity adjustments: 5 19MW addition from Steamboat Hills enhancement 4 2 1 3 6 8MW addition due to higher resource performance at Mammoth, McGinnis Hills, Tungsten, Neal Hot Springs and Raft River 9MW reduction due to lower reso
Slide 13: Puna Hawaii Operation Update
Nov. 2020 Feb. 2021 Mid 2021 Resumed operation 13 MW Expect to reach 10 MW full operation Continue field recovery work Insurance update Copyright © 2021 Ormat Technologies, Inc. 13
Slide 14: Kenya
KENYA Resolved all 3 tax assessments Three assessments of $200M were favorably settled Increased Curtailments Continued curtailments due to COVID-19 Overdue invoices payment $48.9M overdue as of Dec. 31, 2020, of which $16.2M was paid in January and February 2021 Olkaria III complex, Kenya Copyright
Slide 15: Product Backlog
PRODUCT BACKLOG Reduction in 3rd parties’ backlog Backlog at $33M(1) Continued impact of COVID-19 Company is in late stage of signing two mid size projects Focusing manufacturing capacity on internal projects Manufacturing our owned power plants to support organic growth Intersegment revenue in 2020
Slide 16: Energy Storage
ENERGY STORAGE 4 Reached gross profitability 3 1 2020 gross profit – $1.8M 2020 gross margin – 11% 2 Pushing for growth Commercial operation 10MW Rabbit Hill, Texas 01 CA 02 TX M&A 20MW/80MWh 10MW/10MW h 20MW Pomona energy, California – under operation 25MW Upton County, Texas – under construction 0
Slide 20: Robust Growth Plan: 1,455MW-1,575MW
Increase solar and geothermal capacity significantly Accelerate storage capacity to establish ROBUST leading position in the U.S. storage sector GROWTH PLAN YE 2023 portfolio target: 1,455MW - 1,575MW Total expected MW growth: ~ 50% This growth plan is subject to obtaining all permits and regulatory
Slide 21: 2023 Growth Target by Segments
2023 GROWTH GEOTHERMAL & ENERGY SOLAR ENERGY STORAGE TARGET BY SEGMENTS YE 2023 TARGET 1,182MW-1,202MW 273MW-373MW MW ADDITION 250MW-270MW 200MW-300MW MW GROWTH 27%-29% 274%-411% Change in MW growth is compared to a 932MW Geothermal & Solar portfolio and a 73 MW storage portfolio in YE 2020 Copyrigh
Slide 22: Geothermal and Solar Projects Under Development
Projected Expected Project Capacity PPA COD (MW) U.S - Heber Complex 11 H1 2022  U.S - CD4 30 Q1 2022  U.S - North Valley 30 2022 - U.S - McGinness Hills Expansion 8 2021  GEOTHERMAL 10 PROJECTS U.S. - Puna expansion 8 2022  143-148 MW U.S - Dixie Meadows 15 2022  U.S - Tungsten Mountain 2 11 H
Slide 23: Geothermal Prospects
Region Location # of sites Nevada 22 California 4 U.S. Oregon 2 Utah 2 GEOTHERMAL GEOTHERMAL New Mexico 1 PROSPECTS 41 PROSPECTS Guatemala 2 CENTRAL AMERICA Honduras 1 AFRICA Ethiopia 4 New Zealand 1 ASIA PACIFIC Indonesia 2 Copyright © 2021 Ormat Technologies, Inc. 23
Slide 24: Energy Storage Projects Under Development
Projected Expected Type of Project Capacity COD contract (MW) Capacity PPA CA - Valecito 10 Q2 2021 and Merchant Capacity PPA CA - Tierra Buena 5 Q4 2021 and Merchant ENERGY ENERGY STORAGE STORAGE 5 PROJECTS TX - Upton 25 Q4 2021 Merchant PROJECTS 67 MW UNDER NJ - Andover 20 Q1 2022 Merchant DEVELOP
Slide 25: Energy Storage Pipeline
1.2GW 33 200-300MW potential capacity of named expected addition U.S. storage pipeline prospects by YE 2023 ENERGY STORAGE PIPELINE Copyright © 2021 Ormat Technologies, Inc.
Slide 26: Maintaining a Strong Capital Position to Support Accelerated Growth
MAINTAINING A STRONG CAPITAL POSITION TO SUPPORT ACCELERATED GROWTH 2021 expected capital $ 445M needs(1) to support future growth target Over Cash, cash equivalents, $ 900M restricted cash and available lines of credit Access to various 45% 2.4x sources of capital Net debt to Net debt to capitaliza
Slide 27: 2021 Guidance
2021 GUIDANCE Total revenues Electricity revenues Products revenues Storage revenues Adjusted EBITDA $640-675M $570-580M $50-70M $20-25M $400-410M MW EXPECTATIONS ADJUSTED EBITDA EXPECTATIONS 1,500MW $500M run-rate(2) 1,005MW $420M (1) 2020 2021 2022 2023 2020 2021 2022 2023 (1) For non –GAAP financ
Slide 28: The Way We Deliver Sustainable Growth
THE WAY WE DELIVER SUSTAINABLE GROWTH PROVEN IN GEOTHERMAL, APPLICABLE TO STORAGE AND TO NEW ACTIVITIES Creating a greater profit potential by applying vertical integration approach Mitigating portfolio risk through diversification Geothermal activity serves as a solid foundation for Storage activit
Slide 29: Thank You!
THANK YOU! SMADAR LAVI I VP CORPORATE FINANCE AND HEAD OF INVESTOR RELATIONS 775-356-9029 (EXT. 65726) I SLAVI@ORMAT.COM Copyright © Copyright 2021 Ormat © 2021 Ormat Technologies, Technologies, Inc. Inc. 29
Slide 30: Products Segment Third-Party Backlog
3%1% 3% PRODUCTS SEGMENT Germany 18% 31% THIRD-PARTY Guatemala BACKLOG(1) Chile NZ Others $33M Israel 96% Turkey 20% Geothermal CONTRACTS GEOGRAPHIC contracts BREAKDOWN 24% Backlog as of February 24, 2021. The backlog Includes revenues for the period between January 1, 2021 and February 24, 2021; Co
Slide 31: Payment of Principal Due by Period
PAYMENT OF PRINCIPAL DUE BY PERIOD ($M) AVERAGE INTEREST RATE: 4.7% Q1-2021 Q2-2021 Q3-2021 Q4-2021 Year 2021 Long-term non-recourse debt & limited recourse debt 8.1 9.5 8.6 9.8 35.9 Senior Secured Notes (non-recourse) 8.5 5.6 5.0 5.9 25.0 Long-term loans (full recourse) 0.0 4.7 8.4 4.7 17.8 Total 1
Slide 32: Expected Capital Needs for 2021
EXPECTED CAPITAL NEEDS FOR 2021 CAPITAL NEEDS ($M) Construction & Enhancements – fully released 200 Development enhancement and Exploration – not yet released 150 Maintenance CapEx (including drilling in Puna) 40 Storage activity 45 Enhancement of the production facilities 10 Total CapEx $445 Copyri
Slide 33: P&L Highlights
P&L HIGHLIGHTS Q4 2020 Q4 2019 Change (%) FY 2020 FY 2019 Change (%) GAAP MEASURES Revenues ($M) Electricity 146.2 144.4 1.3 % 541.4 540.3 0.2 % Product 27.4 43.8 (37.5) % 148.1 191.0 (22.5) % Energy Storage 5.8 4.3 36.2 % 15.8 14.7 7.6 % Total Revenues 179.4 192.4 (6.8) % 705.3 746.0 (5.5) % Gross
Slide 34: Reconciliation of EBITDA and Adjusted EBITDA
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA Three Months Ended December 31, Twelve-Months Ended December 31, 2020 2019 2020 2019 (Dollars in thousands) (Dollars in thousands) Net income 23,532 14,127 101,806 93,543 Adjusted for: Interest expense, net (including amortization of deferred 18,891 17,24
Slide 35: Reconciliation of Adjusted Net Income Attributable to Stockholders and EPS
RECONCILIATION OF ADJUSTED NET INCOME ATTRIBUTABLE TO THE COMPANY’S STOCKHOLDERS AND EPS Three Months Ended Twelve Months Ended December 31 December 31 2020 2019 2020 2019 Net income attributable to Company’s stockholders ($M) 20.7 12.6 85.5 88.1 One-time tax items ($M) - - - (13.3) Adjusted Net inc

Ormat Technologies — Q4 2020 Earnings Presentation on 6ix

Ormat Technologies — Q4 2020 Earnings Presentation

Slide 1: Ormat Technologies, Inc. Earnings Call

Slide 2: Safe Harbor Statement and Non-GAAP Metrics

Slide 3: 2020 Highlights

Slide 4: Financial Performance

Slide 5: Solid Financial Performance

Slide 6: Revenues by Segment

Slide 7: Gross Margin by Segment

Slide 8: Adjusted EBITDA by Segment

Slide 9: YE 2020 Cash and Cash Equivalents and Restricted Cash

Slide 10: Business Resilience in the Face of COVID-19

Slide 11: Ormat Demonstrated It's Resilient in a Challenging and Volatile Environment

Slide 12: Electricity Operation

Slide 13: Puna Hawaii Operation Update

Slide 14: Kenya

Slide 15: Product Backlog

Slide 16: Energy Storage

Slide 17: Committed to a Sustainable Future

Slide 18: Employees, Community, Environment

Slide 19: Driving Profitable Growth

Slide 20: Robust Growth Plan: 1,455MW-1,575MW

Slide 21: 2023 Growth Target by Segments

Slide 22: Geothermal and Solar Projects Under Development

Slide 23: Geothermal Prospects

Slide 24: Energy Storage Projects Under Development

Slide 25: Energy Storage Pipeline

Slide 26: Maintaining a Strong Capital Position to Support Accelerated Growth

Slide 27: 2021 Guidance

Slide 28: The Way We Deliver Sustainable Growth

Slide 29: Thank You!

Slide 30: Products Segment Third-Party Backlog

Slide 31: Payment of Principal Due by Period

Slide 32: Expected Capital Needs for 2021

Slide 33: P&L Highlights

Slide 34: Reconciliation of EBITDA and Adjusted EBITDA

Slide 35: Reconciliation of Adjusted Net Income Attributable to Stockholders and EPS