Ormat pursuing new opportunities in New Zealand, Indonesia and the Philippines
As reported in its Q3 2019 results, Ormat continues to increase its electricity revenues, which now represent around 72% of its total revenues. At the same time the company expects to restart its Puna plant in Q1 2020, while also pursuing opportunities in New Zealand, Indonesia and the Philippines.
In its release for the results of Q3 2019, Ormat Technologies reports on increased electricity revenues by 6.1% and a push of gross margins to 32.5%. With that the company also raises its guidance for revenues for the year.
Revenues for the quarter stand at $170.5 million, of which $124m are from the sale of electricity, representing around 73%, while the product segment represents $43m, or around 25%.
“We continue to deliver on our stated goals of growing revenues and expanding gross margin,” commented Isaac Angel, Chief Executive Officer. “Total revenues increased 2.4%, driven by strong growth of 6.1% in our core Electricity revenues, which helped to offset both the lack of revenues from our Puna plant in Hawaii (which is preparing to re-start operations after the damage from the 2018 eruption of the Kilauea volcano), as well as the expected quarterly decline in our Product segment revenues. These strong results demonstrate the overall robustness of our Electricity segment and the benefit of our diversified portfolio of operations. Our gross margins also expanded on a year-over-year basis due to the positive impacts of our initiatives to improve plant-level efficiencies and to increase the geographic diversification of our Product segment into higher-margin territories.”
Mr. Angel continued, “The reconstruction efforts at Puna are on schedule and we expect our refurbishment activities will be completed by the end of the year, enabling us to deliver energy from the plant. All of our insurers have now started paying the costs to rebuild the damaged power plant equipment. However, certain insurers rejected our claim for business interruption coverage, and we have filed a lawsuit against these insurers. These lawsuits will not impact our plans for re-starting the Puna facility, and we expect to be able to sell the electricity produced at Puna as soon as the relevant permits required from local authorities for the operation of the substation and the transmission network upgrades being undertaken by our partners at Hawaii Electric Light Company (HELCO) are received. These are expected by the end of Q1 2020, and so we expect to be able to bring the power plant back to operation promptly thereafter, and to gradually increase the power plant’s generating capacity as we complete wellfield drilling work, with a target of regaining full operation by the end of the second quarter of 2020.”
“In the product segment, we are working on new opportunities in New Zealand, Indonesia and the Philippines to diversify and grow our backlog.” continued Mr. Angel. “We remain on pace to meet our full-year targets in all segments and expect to continue our growth path in 2020”
Source: Ormat Release