Sound revenue growth makes 2016 a successful year for Ormat
In the report on its annual results for 2016, Ormat Technologies, Inc. (NYSE: ORA) provided an overview on its financial results and operational highlights for the year of 2016.
The company has increased its revenues by 11.4% over results from 2015 to $662.6 million, with about two-thirds coming from electricity sales and one third from product sales. The company closed the year with a product backlog of $251 million.
Financial highlights for the full year:
- Total revenues of $662.6 million in 2016, an increase of 11.4% from 2015;
- Electricity segment revenues increased 16.1% to $436.3 million in 2016 from $375.9 million in 2015;
- Product segment revenues reached record levels of $226.3 million from $218.7 million in 2015 representing a 3.5% increase;
- Electricity generation increased 11.6%, compared to the full year 2015, from 4.8 million MWh to 5.4 million MWh;
- Gross margin increased to 40.9% in 2016 compared to 36.7% for 2015;
- Operating income increased 23.1% to $201.9 million compared to $164.1 million in the full year of 2015; exclusive of one-time settlement expenses, operating income grew 29.7%;
- Adjusted EBITDA grew 11.2% to $323.8 million in 2016;
- Net income attributable to the company’s shareholders was $93.9 million or $1.87 per diluted share in 2016, compared to $119.6 million or $2.43 per diluted share in 2015. Adjusted Net income attributable to the company’s shareholders was $109.9 million or $2.19 per diluted share in 2016 compared to $70.9 million or $1.44 per diluted share in 2015; an increase of 55.1% and 52.1%, respectively;
- Declared a quarterly dividend of $0.17 per share for the fourth quarter of 2016.
- Product segment backlog increased to $251.0 million.
Operational and business developments for the full year 2016 and subsequent to year end:
- Started construction to expand Olkaria III complex in Kenya by additional 10 MW and increase the complex capacity to 150 MW during 2018;
- Signed an agreement to acquire the business and assets of Viridity Energy, Inc. and enter the growing energy storage and demand response markets;
- Entered into a partnership transaction with a financial investor to efficiently monetize the federal tax incentives relating to five geothermal power plants located in eastern Nevada for an initial purchase price of $62.1 million and additional future installments totaling up to $21.0 million through 2022;
- Closed $50.0 million loan facility agreement with Deutsche Investitions-und Entwicklungsgesellschaft Mbh (DEG) to finance our investment in the 29MW plant 4 in the Olkaria III complex, which commenced operation in February 2016;
- Signed a $36 million engineering, procurement and construction (EPC) contract with Cyrq Energy, Inc. to provide one ORMAT® Energy Converter (OEC) at Cyrq’s Soda Lake geothermal power project in northern Nevada;
- Closed private placement of $92.5 million senior secured notes to refinance the Don A. Campbell Phase I geothermal power project;
- Signed 25-year Power Purchase Agreement with Southern California Public Power Authority (SCPPA) to deliver electricity from the company’s Ormesa geothermal complex in Imperial Valley, Calif. beginning November 30, 2017;
- Closed follow-on sale of 36.75% equity interest to Northleaf for $44.2 million to monetize the second phase of the Don A. Campbell geothermal power plant;
- Raised $204 million of senior unsecured bonds at an average cost of 4.2%; Proceeds, together with other corporate funds, refinanced $250 million of high cost debt;
- Closed the acquisition of the Bouillante Geothermal Power Plant on the Island of Guadeloupe;
- Secured $36.0 million Supply & EPC Contracts for a geothermal power plant in New Zealand; and
- Signed an agreement to jointly build, own, and operate the Rabbit Hill Energy Storage Project located in Georgetown, Texas which moves the company, for the first time, into the energy storage arena.
“This was a strong ending to an excellent year for Ormat, as we delivered another year of record revenue and adjusted EBITDA with double-digit growth and strong execution on all our key metrics,” commented Isaac Angel, Chief Executive Officer. “The new capacity from the fourth plant at our Olkaria III complex and the contribution of the Bouillante geothermal power plant we acquired in 2016, together with the strong performance of the McGinness Hills and Don A. Campbell complexes which came on line during 2015, increased our electricity segment full year revenues and significantly improved our gross profits. The strength of our electricity and our products segment outperformed our estimates. Our efforts to reduce costs and shorten the delivery lead time enabled us to reap the benefits also in the Products segment where we successfully secured new contracts that supported record revenues in 2016 and robust backlog for 2017. During the fourth quarter we finalized several transactions and raised approximately $200 million net that will reduce our overall cost of debt, strengthen our balance sheet and improve our cash position to facilitate our growth plans.”
Source: Ormat
