Ormat Technologies Q2 2009 results and company updates

Alexander Richter 8 Ağu 2009

Ormat Technologies just relased its second quarter results for 2009. The following is a short summary in highlights from the earnings call by the company.

Financial highlights provided by Joseph Tenne the CFO for Ormat Technologies:

Total revenues US$ 100.2 million, a 25% increase from the revenues for Q2 2008. The product segment of the company contributed strongly  with sales of US$ 40 million more than double the sales compared to Q2 2008. The increase in revenues coming mainly from EPC contracts, for the construction of two large geothermal projects in Nevada (this must be the Faulkner 1 project by Nevada Geothermal Power) and New Zealand.

Total revenues in the electricity segment declined slighly due to expected reduction in revenues at the company’s Puna plant on Hawai, resulting from lower oil prices and ongoing construction on the site.

Gross margin at 28% compared to 28.7% in the same quarter last year. There is a strong decrease from 32.8% to 25.8% in the gross margin for the electricity segment, due to a decline in average revenue rate per MWh from US$87 in Q2 2008 to US$75 in Q2 2009.

Adjusted EBITDA in Q2 2009 increased 10.7% to US$ 32.3 million, as compared to US$ 29.8 in Q2 2008.

Operational highlights provided by Yoram Bronicki, President and Chief Operating Officer:

Total U.S. and international generation for quarter was up 14% to about 811,000 MWh, with the year-to-year increase in generation a result of new plants that commenced operation and improved performaced in some of the existing power plants. For the first 6 months total generation was up 18%  to about 1.7 million MWh.

Drilling and tie-ins for new wells have been completed in Heber and Amatitlan, with both facilities now closer to their design capacity.

Injection challenges at North Brawley project continue to be worked on.

By the end of 2010 the company plans to add on between 72 and 84 MW of generating capacity (geothermal and recovered energy power plants). Work is continued on the 8 MW expansion ant Puna, with significant progress being made on the PPA with Hawaii Electric Light Company. The plant could be commercial by 2010.

East Brawley project completion expected in late 2010, after resolving permitting issues currently delaying it.

New projects of the company beyond 2010 are expected to add 151-168 MW, these projects are Mammoth Phase 3 and Imperial Valley in California, Carson Lake and McGinness Hills in Nevada, as well as Sarulla in Indonesia. The Sarulla project is a joint effort by various companies, with Ormat owning a 12.75% interest in the consortium. The Mammoth project is a partnership with Constellation Energy.

Dita Bronicki, the company’s CEO than talks about the future for the company and the expected revenues for the year to increase to US$ 382-400 million.

The rest of the call includes answers to analyst questions, among them the question of increased consolidation and new players and technologies.

Source: Ormat Technologies Inc. Q2 2009 Earnings Call Transcript via Seeking Alpha; Actual slides of the presentation (pdf, source Ormat)