Ormat Technologies, Inc. · NYSE:ORA

Ormat Technologies — Q3 2021 Earnings Presentation

33 slides from Ormat Technologies's earnings presentation, November 2021

  1. Slide 1: Ormat Technologies, Inc. Investor Presentation November 2021

    ORMAT TECHNOLOGIES, INC. INVESTOR PRESENTATION NOVEMBER 2021 Copyright Copyright©©2021 2021Ormat OrmatTechnologies, Technologies,Inc. Inc.

  2. 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

  3. Slide 3: Introduction

    INTRODUCTION Copyright © 2021 Ormat Technologies, Inc. 3

  4. Slide 4: A Leading Renewable Energy Provider with a Proven Track Record

    A LEADING RENEWABLE over Own & operate ENERGY PROVIDER 55 1,100MW WITH A PROVEN TRACK RECORD Years of experience Geothermal, Storage, Solar PV & REG(1) IN GEOTHERMAL AND ENERGY STORAGE 1,400 $ 705M Employees 2020 revenues $ 420M $ 86M 2020 adj. EBITDA(2) 2020 Net income(3) (1) REG – Recovered Energy

  5. Slide 5: Our Business Segments

    OUR BUSINESS SEGMENTS 87% 8% 5% of LTM of LTM of LTM revenues revenues revenues ELECTRICITY PRODUCT ENERGY STORAGE Develop, build, own and operate Design, manufacture and sell Growing to establish geothermal, solar and recovered equipment for geothermal and leading position energy-based (REG) power

  6. Slide 6: Our Core Competencies

    OUR CORE COMPETENCIES THE WORLD’S ONLY VERTICALLY INTEGRATED GEOTHERMAL COMPANY Development Drilling Engineering Manufacturing Construction Operation and/or exploration ELECTRICITY PRODUCT STORAGE Copyright © 2021 Ormat Technologies, Inc. 6

  7. Slide 7: Electricity Segment Overview

    ELECTRICITY SEGMENT OVERVIEW 5 4 Diversified 1 2 3 portfolio 6 63% 37% U.S. International 2020 01 U.S. 02 03 Honduras Geographic 730 MW Guatemala 38 MW breakdown 40 MW 05 Kenya of revenues 04 Guadeloupe 06 Indonesia 15 MW 150 MW 42 MW(1) $540 $541 $510 Global operation $436 $466 94% geothermal; High

  8. Slide 8: Geothermal Market

    GEOTHERMAL MARKET Ormat -the 2nd largest geothermal owner & operator 1,400 100 1,200 80 1,000 800 60 600 40 400 20 200 0 0 EDC (PNOC) Ormat CFE ENEL Star Energy Calpine Aboitiz Contact Mercury Terra-Gen 1 Consortium Energy (ECP) Operation (MW) Estimated Project Count 13.5GW Global Installed geotherm

  9. Slide 9: Product Segment Overview

    PRODUCT SEGMENT OVERVIEW Primary provider of geothermal binary plants Suppliers of geothermal power plants 2015 – 2019 capacity, MW Market leader Built approx. 190 power plants and installed approx. 56% 72% 3,200 MW of geothermal & REG over the years Binary Ormat STG & BINARY BINARY 3rd parties’ bac

  10. Slide 10: Energy Storage Overview

    ENERGY STORAGE OVERVIEW 4 Growth in U.S. energy storage incremental 1 3 capacity (MW) 2 7,910 7,318 01 CA 02 TX 6,508 30MW/120MW 10MW/10MW 5,047 h h 03 NJ 04 VT 41MW/41MW 2MW/5MWh h Establishing strong market position 1,339 Focus on largest and most lucrative markets California, Texas, New York and

  11. Slide 11: Strong Tailwinds for Geothermal and Energy Storage

    STRONG TAILWINDS FOR GEOTHERMAL AND ENERGY STORAGE Governments around the world continue to support renewable energy In the U.S., negotiations between the White House and Congress have made substantial progress over the past week The Bill draft includes, among others: • Extension of PTC and ITC unti

  12. Slide 12: Ormat's Growth Drivers

    ORMAT’S GROWTH DRIVERS Copyright © 2021 Ormat Technologies, Inc. 12

  13. Slide 13: Robust Growth Plan

    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: 1,528MW - 1,648MW Total expected MW growth: ~ 50% This growth plan is subject to obtaining all permits and regulatory

  14. Slide 14: 2023 Growth Target by Segments

    2023 GROWTH GEOTHERMAL & ENERGY SOLAR ENERGY STORAGE TARGET BY SEGMENTS (VS 2020) YE 2023 TARGET 1,255MW-1,275MW 273MW-373MW MW ADDITION 323MW-343MW 200MW-300MW MW GROWTH 35%-37% 274%-411% Change in MW growth is compared to a 932MW Geothermal & Solar portfolio (including 83MW added in 2021) and a 73

  15. Slide 15: Geothermal and Solar Projects Under Development

    July 2021 New acquired 67.5MW were added in NV Projected Expected Project Capacity PPA COD (MW) U.S - Heber Complex 11 End 2022  U.S - CD4 30 Q1 2022  End Under U.S - North Valley 25 2022/Early negotiation 2023 GEOTHERMAL U.S. - Puna expansion 8 2023 Suspended 10 PROJECTS U.S - Dixie Meadows 15 20

  16. Slide 16: Energy Storage Projects Under Development

    August 2021 New RA(1) contract with PG&E for Pomona 2 in CA Projected Expected Type of Project Capacity COD contract (MW) Capacity PPA CA - Tierra Buena 5 Q1 2022 and Merchant TX - Upton 25 Q1 2022 Merchant ENERGY STORAGE NJ - Andover 20 Q2 2022 Merchant 6 PROJECTS ENERGY 89 MW NJ - Howel 7 Q2 2022

  17. Slide 17: Energy Storage Pipeline

    2.1 GW 30 200MW - 300MW potential capacity of named expected addition U.S. storage pipeline prospects by YE 2023 ENERGY STORAGE PIPELINE Copyright © 2021 Ormat Technologies, Inc. 17

  18. Slide 18: Growth: MW and Adjusted EBITDA Expectations

    GROWTH MW EXPECTATIONS ADJUSTED EBITDA EXPECTATIONS 1,500MW >$500M run-rate(2) 1,005MW $420M (1) 2020 2021 2022 2023 2020 2021 2022 2023 (1) For non –GAAP financial measures reconciliation please see the appendix slides (2) Annual run-rate towards the end of 2022 Copyright © 2021 Ormat Technologies,

  19. Slide 19: Acquisition from TG Geothermal Portfolio

    $171M for 100% of the equity interests $206M Total debt & lease obligations that was recognized at its fair value of $258M Acquired from TG Geothermal Portfolio, LLC1: 67.5 MW from two geothermal plants in Nevada: 56 MW Dixie Valley I Off taker: SCE I PPA by 2038 I above market prices 11.5 MW Beowaw

  20. Slide 20: Acquisition Revenue and EBITDA Expectations by 2025

    In 2022 $55M REVENUE & $37M EBITDA From operating contracted assets By IMPROVE EFFICIENCIES AND COST SAVING 2025 Operational proximity to our power plants Refinancing the current debt supported by our strong balance sheet 20% INCREASE IN EBITDA Asset's expansion using our technology and expertise, m

  21. Slide 21: Key Investment Highlights

    KEY INVESTMENT HIGHLIGHTS Copyright © 2021 Ormat Technologies, Inc. 21

  22. Slide 22: Key Investment Highlights

    KEY INVESTMENT HIGHLIGHTS Strong financial Innovative Robust growth ESG positioning potential Copyright © 2021 Ormat Technologies, 22Inc. 22

  23. Slide 23: Strong Financial Positioning

    STRONG FINANCIAL POSITIONING Installed capacity growth (MW) Revenue growth ($m) Geothermal REG Solar Storage Electricity segment Product segment Energy Storage 1,005 931 957 $693 $719 $746 $705 795 $663 713 857 854 872 742 660 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 Electricity segment gro

  24. Slide 24: Strong Financial Positioning: Debt and Leverage

    STRONG FINANCIAL POSITIONING Total Debt ($M) Net Debt ($M)(1) Project Finance Finance liability Corporate Debt $1,925 $1,090 $1,085 $1,524 $1,456 $919 $1,238 $817 $1,268 $914 2017 2018 2019 2020 September 2017 2018 2019 2020 September 30, 2021 30, 2021 Net Debt to Capitalization (Total Equity) (1) N

  25. Slide 25: Pure-Play Renewables Platform Aligned with ESG Principles

    PURE-PLAY RENEWABLES PLATFORM ALIGNED WITH ESG PRINCIPLES We are moving to strengthen our ESG commitments ORMAT CO2 EMISSIONS ARE LOWER THAN ALTERNATIVE RESOURCES (MM)1 Building our approach and policy on significant valuable issues 7.6 • Water management tons of CO2 • Taxation • Suppliers and procu

  26. Slide 26: Attractive Investment Thesis

    ATTRACTIVE INVESTMENT THESIS Strong financial Robust growth ESG positioning potential Renewable asset growth in Consistent track record of Significant, consistent the U.S. supported by strong returns for shareholders Domestic growth favorable regulatory dynamics International geothermal Pure-play re

  27. Slide 27: Appendix

    APPENDIX Copyright © 2021 Ormat Technologies, Inc. 27

  28. Slide 28: Reconciliation of EBITDA and Adjusted EBITDA (Cont'd)

    RECONCILIATION OF EBITDA AND ADJUSTED EBITDA (CONT’D) The following table reconciles net income to EBITDA and Adjusted EBITDA for the twelve-month periods ended December 31, 2020, 2019, 2018, 2017 and 2016. Year Ended December 31, 2020 2019 2018 2017 2016 (Dollars in thousands) Net income 101,806 93

  29. Slide 29: Reconciliation of EBITDA and Adjusted EBITDA

    RECONCILIATION OF EBITDA AND ADJUSTED EBITDA (DOLLARS IN THOUSANDS) Three Months Nine-Months Ended September Ended September 30, 30, 2021 2020 2021 2020 Net income 20,780 23,098 53,804 78,274 Adjusted for: Interest expense, net (including amortization of deferred financing costs) 21,711 21,130 58,28

  30. Slide 30: Reconciliation of Non-GAAP Financial Measures

    RECONCILIATION OF NON-GAAP FINANCIAL MEASURES Year Ended December 31 September 30, 2020 2019 2018 2017 2016 2021 Cash and cash equivalents and Restricted cash (in millions $) Cash and cash equivalents 268 448 71 99 48 230 Marketable Securities at fair value 45 Restricted cash and cash equivalents 88

  31. Slide 31: Capex for 2021

    CAPEX FOR 2021 ACTUAL INVESTED CAPITAL NEEDS TOTAL CAPEX ($M) IN 9 MONTHS 2021 FOR Q4 2021 FOR 2021 Electricity Segment 263 145 408 Construction & Enhancements – fully released 156 110 266 Development enhancement, drillings and Exploration 24 15 39 Puna restoration (including drilling) 27 5 32 Olkar

  32. Slide 32: Products Segment Third-Party Backlog

    2% 5% 14% PRODUCTS Germany 16% SEGMENT Guatemala Japan THIRD-PARTY Indonesia 2% BACKLOG(1) Taiwan Chile 11% $66.9M 12% Nicaragua Canada CONTRACTS GEOGRAPHIC Others 98.6% Geothermal BREAKDOWN 7% contracts 31% Backlog as of November 3, 2021. The backlog includes revenues for the period between October

  33. Slide 33: Air-Cooled Binary Geothermal Power Plant

    AIR-COOLED BINARY GEOTHERMAL POWER PLANT Copyright © 2021 Ormat Technologies, Inc. 33

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