Ormat reports product sales of $74m and overall 25% revenue increase for Q1 2017
Reporting on its quarterly results, Ormat Technologies reports an increase of product revenues of 69% for Q1 2017 compared to the same quarter last year and an overall increase of revenues by 25% to $190 million.
In a release today, Ormat Technologies reports a total revenue increase of 25.3% for the first quarter of 2017 compared to the same quarter last year.
Here highlights and recent developments as announced by Ormat in the release today:
- Total revenues of $189.9 million, up 25.3% compared to the first quarter of 2016;
- Electricity segment revenues increased 7.3% to record revenues of $115.8 million, up from $107.9 million in the first quarter of 2016;
- Product segment revenues increased 69.5% to $74.1 million, up from $43.7 million in the first quarter of 2016;
- Electricity generation increased 2.2%, compared to the first quarter of 2016, from 1.397 million MWh to 1.428 million MWh;
- Gross margin decreased to 39.2% compared to 42.1% in the first quarter of 2016, due to a lower margin in the Product segment;
- Operating income increased 17.7% to $59.5 million, compared to $50.5 million in the first quarter of 2016;
- Net income attributable to the company’s shareholders of $35.3 million or $0.70 per diluted share, compared to $29.3 million or $0.59 per diluted share in the first quarter of 2017;
- Adjusted EBITDA grew 14.4% to a record of $91.8 million in the first quarter of 2017;
- Declared a quarterly dividend of $0.08 per share for the first quarter of 2017;
- Product segment backlog remains strong at $207.0 million1; added approximately $30 million of new orders2;
- Closed acquisition of substantially all of the business and assets of Viridity Energy, Inc.;
- Commenced commercial operation of the first unit of the Sarulla geothermal power plant, one of the world’s largest geothermal power plants, located in Indonesia’s North Sumatra; and
- ORIX will acquire 22% ownership stake in Ormat from FIMI and Bronicki Investments and simultaneously enter into strategic partnership with Ormat. Closing is expected in the third quarter of 2017.
“This was another good quarter, benefitting from outstanding execution in both our electricity and products segment,” commented Isaac Angel, Chief Executive Officer. “As we have noted, our goal in the electricity segment has been to adjust output at our facilities to maximize efficiency, and the progress we are making in this area is evidenced by the improvement in gross margin to 43.0%. The addition of the Bouillante facility, coupled with full output again at Puna, has helped us increase revenue in the segment by more than 7%. I am encouraged with our progress in this segment.”
Mr. Angel continued, “Our products segment delivered a nearly 70% increase in quarterly sales, due to our progress in projects in New Zealand, China and Turkey. As previously indicated, several of these projects, most notably in Turkey, as well as timing issues related to product deliveries, contributed to lower gross margin which is expected to remain at similar level during 2017. As a result of the improvements we are constantly making to increase efficiencies across our operations, we delivered a record adjusted EBITDA of nearly $92 million.”
Mr. Angel continued, “We recently announced that ORIX will acquire 22% ownership stake in Ormat mainly from FIMI and Bronicki Investments. Simultaneous, we signed a commercial cooperation agreement with ORIX. We see this commercial cooperation agreement as a significant development that will enhance our strategic position, expand our geographic footprint as well as our technological and customer base. ORIX’s global reach and reputation in the energy market serves as a further validation of Ormat’s comprehensive capabilities and track record to a broader market and provides a platform to accelerate our growth.”
Mr. Angel added, “We reiterate our guidance and expect full-year 2017 total revenues between $680.0 million and $700.0 million with electricity segment revenues between $460.0 million and $470.0 million and product segment revenues between $220.0 million and $230.0 million. We expect 2017 Adjusted EBITDA between $340 million and $350 million for the full year. We expect annual Adjusted EBITDA attributable to noncontrolling interest to be approximately $23.0 million.”
First Quarter 2017 Financial Results
For the three months ended March 31, 2017, total revenues were $189.9 million, up from $151.6 million for the three months ended March 31, 2016, an increase of 25.3%. Electricity segment revenues increased 7.3% to $115.8 million in the three months ended March 31, 2017, up from $107.9 million for the three months ended March 31, 2016. Product segment revenues increased 69.5% to $74.1 million for the three months ended March 31, 2017, up from $43.7 million in the three months ended March 31, 2016.
General and administrative expenses for the three months ended March 31, 2017 were $9.9 million, or 5.2% of total revenues, compared to $8.7 million, or 5.8% of total revenues, for the three months ended March 31, 2016. The increase was mainly due to merger and acquisition costs.
The company reported net income attributable to the company’s shareholders of $35.3 million, or $0.70 per diluted share, compared to net income attributable to the company’s shareholders of $29.3 million, or $0.59 per diluted share, for the same period last year.
Adjusted EBITDA for the three months ended March 31, 2017 was $91.8 million, compared to $80.2 million for the three months ended March 31, 2016, an increase of 14.4%. The reconciliation of GAAP net cash provided by (used in) operating activities and net income to EBITDA and Adjusted EBITDA and additional cash flow information is set forth below in this release.