Slide 1: Ormat Technologies, Inc. Earnings Call
ORMAT TECHNOLOGIES, INC. EARNINGS CALL DORON BLACHAR, CEO ASSI GINZBURG, CFO AUGUST 4, 2022 Copyright© Copyright ©2022 Ormat Technologies, 2022 Ormat 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: Q2 2022 Highlights
Q2 2022 HIGHLIGHTS DELIVERING SOLID EXPANDING OUR PORTFOLIO ADVANCING PROFITABLE FINANCIAL PERFORMANCE AND IMPROVING OPERATIONAL GROWTH PERFORMANCE Copyright © 2022 Ormat Technologies, Inc. 3
Slide 4: Financial Performance
FINANCIAL 01 PERFORMANCE Copyright © 2019 Ormat Technologies, Inc. 4 Copyright © 2022 Ormat Technologies, Inc. 4 Copyright © 2022 Ormat Technologies, Inc.
Slide 5: Financial Performance Q2 Highlights
FINANCIAL PERFORMANCE Q2 22 HIGHLIGHTS Revenues Gross margin Adjusted EBITDA(1) EPS/Adjusted EPS( (2,3) $169.1M 34.1% $100.7M $0.20/0.22 +15.1% -130 bps +19.1% (13.0)%/(6.4)% H1 22 Revenues Gross margin Adjusted EBITDA(1) EPS/Adjusted EPS(1,2,3) $352.8M 36.1% $208.5M $0.53/0.57 +12.6% -400 bps +13.5
Slide 6: Revenues by Segment
REVENUES BY SEGMENT Q2 22 Total Electricity Products Storage 89% 6% $169.1M $151.2M $10.4M $7.5M Electricity Products +15.1% +12.9%% +40.2% +33.1% 5% Storage H1 22 Total Electricity Products Storage 89% 7% $352.8M $313.7M $25.0M $14.1M Electricity Products +12.6% +12.5% +55.9% (23.4)% 4% Storage Cop
Slide 7: Gross Margin by Segment
GROSS MARGIN BY SEGMENT Q2 22 Total Electricity Products Storage 34.1% 36.8% 0.2% 25.3% -130 bp -60 bp -1,990 bp +1,890 bp H1 22 Total Electricity Products Storage 36.1% 39.4% 4.2% 19.8% -400 bp -190 bp -860 bp -2,540 bp Copyright © 2022 Ormat Technologies, Inc. 7
Slide 8: Adjusted EBITDA by Segment
ADJUSTED EBITDA(1) BY SEGMENT Q2 22 Total Electricity Products Storage 96% 4% Storage $100.7 $97.0M $0.2M $3.5M Electricity +19.1% +22.0% (93.0)% +73.9% 0% Products H1 22 Total Electricity Products Storage 96% 3% Storage $208.5 $199.0M $2.2M $7.3M Electricity 1% +13.5% +14.0% (48.1)% +46.9% Products
Slide 9: Q2 2022 Cash and Net Debt
Q2 2022 I CASH AND NET DEBT Cash and Cash Equivalents, Marketable Securities and restricted cash and Cash Equivalents ($M) Net Debt1 ($M) 115 263 495 $1,698 316 $1,523 Cash from operating Investment activities in CapEx $387 14 18 25 7 $356 Debt Dividend Proceeds from Shares Repayment Capped Other De
Slide 10: Maintaining a Strong Capital Position to Support Accelerated Growth
MAINTAINING A STRONG CAPITAL POSITION TO SUPPORT ACCELERATED GROWTH H2 2022 expected capital $254M needs(1) to support future growth target $ 760M Cash, cash equivalents, restricted cash and available lines of credit Access to various 46% 4.0x sources of capital Net debt to Net debt to capitalizatio
Slide 11: Operational Update
02 OPERATIONAL UPDATE Copyright © Copyright © 2022 2022 Ormat Ormat Technologies, Technologies, Inc. Inc. 11
Slide 12: Ormat Moves Towards Achieving Its Growth Goals
ORMAT MOVES TOWARDS ACHIEVING ITS GROWTH GOALS ELECTRICITY UPDATE PRODUCT BACKLOG ENERGY STORAGE Copyright © 2022 Ormat Technologies, Inc. 12
Slide 13: Electricity Operation
ELECTRICITY OPERATION Robust and balanced portfolio Global portfolio increased by 68MW since the end of the first quarter to 1,080 MW 1.5% increase in generation Revenue per MWh was approximately $100 in Q2 2022 4 5 2 1 3 6 Generation growth 1,500 GWh 01 U.S. 02Guatemala 03 Honduras 795 MW 40 MW 38
Slide 14: Electricity Operation
ELECTRICITY OPERATION April June July End o 2023 Tungsten 2 Steamboat CD4 New additional 13MW Solar 30 MW 120 MW 5 MW Wister Solar 20 MW Added 68MW to the Electricity segment portfolio CD4 – we are optimizing interconnection to allow additional MWs to the grid CD4, NV, USA Copyright © 2022 Ormat Tec
Slide 15: Puna
PUNA Q2 2022 25-26 MW Stable capacity High energy rates due to high oil prices Year end of 2022 into 2023 Drilling campaigns targeting to restore capacity to 38mw New 46MW PPA Continued discussion with HELCO - process to amend PPA is underway Puna complex, Hawaii Copyright © 2022 Ormat Technologies,
Slide 16: Operation Update
OPERATION UPDATE Olkaria • Power plant is generating 123 MW • Targeting generation of 127 MW by year-end • Heber 1 Fire • Steam unit is down since Feb 28th • Recorded $3.4 million insurance proceeds Dixie valley • Plant was down for 39 days during the second quarter due to unplaned shutdown and main
Slide 17: Product Backlog
PRODUCT BACKLOG 3rd parties’ contracts Backlog at $54.9M(1) – 20.1% increase vs last quarter Signed $20 million contracts that were awarded last quarter 8% 11% 6% 11% 7% $54.9M 14% 92.3% Geothermal contracts 13% 30% EFE-8 Unit 2 geothermal power plant, Turkey (1) Backlog as of August 3, 2022. The ba
Slide 18: Energy Storage
ENERGY STORAGE COMPLETED TIERRA BUENA 5MW/20MWh STORAGE FACILITY Improved Adjusted EBITDA profitability 45.8% 4 3 1 35.1% 3.8 2.0 2 Adjusted EBITDA EBITDA Margin Storage Segment Revenues Breakdown 01 CA 02 TX 7.5 0.13 35MW/140MWh 10MW/10MWh 5.6 0.6 6.6 7.3 03 NJ 04 VT 4.9 41MW/41MWh 2MW/5MWh Q2 2021
Slide 19: Advancing Profitable Growth
ADVANCING PROFITABLE 03 GROWTH Copyright © 2019 Ormat Technologies, Inc. 19 Copyright © 2022 Ormat Technologies, Inc. 19 Copyright © 2022 Ormat Technologies, Inc.
Slide 20: Increase Solar and Geothermal Capacity Significantly
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: ~1.5 GW Total expected MW growth vs 2021: ~ 42% This growth plan is subject to obtaining all permits and regulatory a
Slide 21: 2023 Growth Target by Segments
2023 GROWTH ` GEOTHERMAL & ENERGY SOLAR ENERGY STORAGE TARGET BY SEGMENTS (VS 2021) ~1,200MW 273 – 353 MW / 640 – YE 2023 TARGET 780 MWh MW ADDITION(1),(2) ~190MW 190 - 270 MW MW GROWTH ~18.5% 228%-324% (1) Increase in MW growth is compared to a 1,012MW Geothermal & Solar portfolio and an 83 MW stor
Slide 22: 6 Geothermal Projects 60-65 MW by 2023
Projected Expected Project Capacity PPA COD (MW) End 2022/Early U.S - North Valley 25 ✓ 2023 U.S. – Dixie Valley 4 Q1 2023 ✓ U.S - Heber Complex 11 Q2 2023 ✓ Guatemala - Zunil 5 H1 2023 ✓ GEOTHERMAL U.S. - North Valley 2 5-10 H1 2023 ✓ 6 PROJECTS(2) GEOTHERMAL 60-65 MW Guadeloupe- Bouillante 10 End
Slide 23: Solar Energy Projects Under Development
Projected Expected Project Capacity PPA COD (MW) U.S. - Tungsten Solar 2 9 Q2 2022 ✓ SOLAR U.S. - Brady Solar 6 Q1 2023 ✓ 5 PROJECTS 41 MW AC U.S. – North Valley Solar 7 Q1 2023 ✓ BY 2023 U.S. - Steamboat Solar 5 Q2 2023 ✓ SOLAR ENERGY U.S. – McGinness Hills Solar 14 H2 2023 ✓ PROJECTS UNDER DEVELOP
Slide 24: Energy Storage 7 Projects Under Development
Projected Projected Expected Project Capacity PPA MWh COD (MW) TX - Upton 25 25 Q3 2022 Merchant NJ - Andover 20 20 H2 2022 Merchant NJ - Howell 7 7 H2 2022 Merchant ENERGY STORAGE 7 PROJECTS OH – Bowling Green 12 12 H2 2022 Capacity PPA and Merchant 184 MW/444 MWh ENERGY BY 2023 CA – Pomona 2 20 40
Slide 25: Energy Storage Pipeline
2.3 GW 32 190MW - 270MW/ potential capacity of U.S. storage pipeline named prospects 465-605MWh expected addition by YE 2023 ENERGY STORAGE PIPELINE Copyright © 2022 Ormat Technologies, Inc. 25
Slide 26: 2022 Guidance
2022 GUIDANCE (3) Total revenues Electricity revenues Products revenues Storage revenues Adjusted EBITDA $710M-$735M $630M-$640M $50M-$60M $30M-$35M $430M-$450M MW EXPECTATIONS ADJUSTED EBITDA EXPECTATIONS ~1.5GW >$500M run-rate(2) 1.1GW $401M (1) 2021 2022 2023 2021 2022 2023 (1) For non –GAAP fina
Slide 27: Executing on Our Growth Plans
Executing on our growth plans COD for 73MW new projects since the end of the first quarter Delivered solid second quarter results Driven by growth in the Electricity and Energy Storage segments A strong tailwinds to support renewable and storage energy New proposed bill supporting tax incentives Mai
Slide 28: Thank You!
THANK YOU! SMADAR LAVI I VP HEAD OF INVESTOR RELATIONS AND ESG PLANNING & REPORTING 775-356-9029 (EXT. 65726) I SLAVI@ORMAT.COM Copyright © 2019 Ormat Technologies, Inc. 28 28 Copyright © 2022 Ormat Technologies, Inc. Copyright © 2022 Ormat Technologies, Inc.
Slide 29: Payment of Principal Due by Period
PAYMENT OF PRINCIPAL DUE BY PERIOD ($M) AVERAGE INTEREST RATE: 4.0% Q3-2022 Q4-2022 Year 2022 Long-term non-recourse debt & limited recourse debt 13.6 15.8 29.4 Long-term loans (full recourse) 18.2 18.3 36.5 Finance Liability 7.1 0.0 7.1 Total 256.9 29.5 346.6 Remaining Total 2022 2023 2024 2025 202
Slide 30: CapEx for 2022
CAPEX FOR 2022 ACTUAL INVESTED TOTAL CAPEX TOTAL CAPEX ($M) IN H1 2022 FOR H2 2022 FOR 2022 Electricity Segment 208 199 407 Construction & Enhancements – fully released 123 132 255 Development enhancement, drillings and Exploration 20 20 40 Puna restoration (including drilling) 24 10 34 Olkaria reco
Slide 31: P&L Highlights
P&L HIGHLIGHTS Q2 2022 Q2 2021 H1 2022 H1 2021 GAAP MEASURES Revenues ($M) Electricity 151.2 133.9 313.7 278.9 Product 10.4 7.4 25.0 16.1 Energy Storage 7.5 5.6 14.0 18.3 Total Revenues 169.1 146.9 352.8 313.3 Gross margin (%) Electricity 36.8 % 37.4 % 39.4 % 41.3 % Product 0.2 % 20.1 % 4.2 % 12.8 %
Slide 32: Reconciliation of EBITDA and Adjusted EBITDA
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA (DOLLARS IN THOUSANDS) Three Months Six-Months Ended June 30, Ended June 30, 2022 2021 2022 2021 Net income 14,945 15,195 37,738 33,024 Adjusted for: Interest expense, net (including amortization of deferred financing costs) 20,239 17,818 40,978 36,571 In
Slide 33: Reconciliation of Adjusted Net Income and Adjusted EPS
RECONCILIATION OF ADJUSTED NET INCOME ATTRIBUTABLE TO THE COMPANY’S STOCKHOLDERS AND ADJUSTED EPS Three Months Ended Six Months Ended June 30 June 30 2022 2021 2022 2021 (in millions, except for EPS) GAAP Net income attributable to the Company's stockholders $11.3 $13.0 $29.7 $28.3 One-time net expe
Slide 34: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES June 30, 2022 Cash and cash equivalents, marketable securities and Restricted cash (in millions $) Cash and cash equivalents 263 Restricted cash and cash equivalents 93 Total cash and cash equivalents, marketable securities and Restricted cash (in millio