Ormat Technologies, Inc. · NYSE:ORA
Ormat Technologies — Investor Presentation (March 2019)
30 slides from Ormat Technologies's investor presentation, March 2019
Slide 1: Ormat Technologies Inc. Investor Presentation March 2019
ORMAT TECHNOLOGIES INC. INVESTOR PRESENTATION MARCH 2019 Copyright Copyright©©2019 2019Ormat OrmatTechnologies, Technologies,Inc. Inc.
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT 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 amounts for 2020 growth (MW) or 2022 operational performance metrics such
Slide 3: Non-GAAP Metrics
NON-GAAP METRICS Reconciliation to US GAAP Financial Information This presentation includes certain “non-GAAP financial measures” within the meaning of Regulation G under the Securities Exchange Act of 1934, as amended, including EBITDA and Adjusted EBITDA. The presentation of these non-GAAP financi
Slide 4: Introduction to Ormat
INTRODUCTION TO ORMAT Market leader with proven track record in the geothermal energy sector Our mission is to become a leading global renewable energy provider Own & operate ~1,400 910 MW Employees 719$M FY2018 revenues 54 years 368$M of experience FY2018 adj. EBITDA(1) (1) See appendix for reconci
Slide 5: YTD 2018 Summary - Continuing Execution
YTD 2018 SUMMARY - CONTINUING EXECUTION Improve Organic Strategic New efficiencies growth M&A activities Closed acquisition of U.S. Added Geothermal, and added Secured over 77 MW 38 MW 250 $M of organic growth to our operating portfolio of capital to support growth plan Plan to add by the end of 202
Slide 6: The World's Only Vertically Integrated Geothermal Company - Electricity
THE WORLD’S ONLY VERTICALLY INTEGRATED GEOTHERMAL COMPANY Development Drilling Engineering Manufacturing Construction Operation Customers: & exploration local utilities, C&I Electricity segment 67% of total revenues (1) (1) 2014-2018 average. Copyright © 2019 Ormat Technologies, Inc. 6
Slide 7: The World's Only Vertically Integrated Geothermal Company - Products
THE WORLD’S ONLY VERTICALLY INTEGRATED GEOTHERMAL COMPANY Development Drilling Engineering Manufacturing Construction Operation Customers: & exploration local utilities, developers C&I Products Product segment segment 32% of total revenues (1) (1) 2014-2018 average. Copyright © 2019 Ormat Technologi
Slide 8: Electricity Segment Overview
ELECTRICITY SEGMENT OVERVIEW Stable, well managed, cash generating assets • Global operation of 910 MW at 25 sites • 94% geothermal and 6% REG • Weighted average PPA life: 18 years(1) Annual revenue ($M) Global portfolio (910 MW) $510 (4) $466 $436 $382 $376 U.S. Guadeloupe 622 MW 15 MW (3) Guatemal
Slide 9: Product Segment Overview
PRODUCT SEGMENT OVERVIEW Built approx. 180 power plants and installed over 2,900 MW of geothermal & REG over the years • Backlog of $216.8M as of February 26, 2019 (1) • Signed new contract in Turkey for approx. $28 million • Backlog excludes a contract awarded but not yet signed – approx. $60.0 mil
Slide 10: Delivering Growth and Expanding Geographical Footprint
DELIVERING GROWTH AND EXPANDING GEOGRAPHICAL FOOTPRINT 2018 portfolio growth summary: December 2018, McGinness Hils Phase 3, Nevada, U.S. 115 MW 6 2 of new capacity new power plants new states - U.S. April 2018, acquired Raft River, U.S. Idaho, U.S. Kenya Indonesia May 2018, NIL 2, Sarulla, June 201
Slide 11: Growth Plan
GROWTH PLAN • Added 115 MW YTD from organic growth and acquisition • Expect adding between 127 MW and 142 MW by the end of 2021(1) • Continue to look for M&A opportunities Projected Project Expected COD PPA Capacity U.S - Tungsten Solar 7 AC MW Q1 2019 v U.S - Steamboat Hills Enhancement 19 MW 2020
Slide 12: Electricity Segment: Long-Term Growth Target
ELECTRICITY SEGMENT: LONG-TERM GROWTH TARGET U.S. Guadeloupe Guatemala Honduras Ethiopia Indonesia New Zealand Construction & development Business development & exploration Geographic expansion target (MW)(1) Growth target (MW)(1) 2014 2018 2022 Target 1,150 910 647 US International 2014 2018 2022 T
Slide 13: Expansion to New Activities: Energy Storage Market
EXPANSION TO NEW ACTIVITIES: ENERGY STORAGE MARKET Vertical integration as a platform to grow in the storage market Development Engineering Procurement Construction Operation Development Inverter and Pipeline battery Copyright © 2019 Ormat Technologies, Inc. 13
Slide 14: Energy Storage
ENERGY STORAGE • Viridity acquisition (March 2017) positioned us to strengthen and 1MW/1MWh system, NJ, U.S. expand our presence in the energy storage market • Developed turnkey and unique offerings with Ormat integration: Battery Storage as a Service (BSAAS) systems • Recent developments • Commissi
Slide 15: Funding Growth
FUNDING GROWTH • Global expansion - risk mitigation aspects • Portfolio approach - diversification • Host country guarantee • Project finance (OPIC, ADB, DEG and AFDB) • Political risk insurance • Competitive pricing (1) (1) ’ these are potential sources of funding and financial support. Copyright ©
Slide 16: Financing Update - Secured Over $250M of Capital
FINANCING UPDATE – SECURED OVER $250M OF CAPITAL • Corporate debt • Closed a $100.0M senior unsecured loan with Migdal group • Tungsten Mountain Tax partnership • Closed a $33.4M partnership agreement with a private investor • The partnership transaction enables us to better benefit from tax incenti
Slide 17: Strong Execution - Revenue ($M)
STRONG EXECUTION - REVENUE ($M) $719 $693 $662 8 3 $595 $559 202 225 226 202 180-190 510 436 466 510 530-540 2014 2015 2016 2017 2018 Electricity Products Other (1) Electricity revenues for 2017 were $468.3M including $2.7M revenues related to energy storage and demand response services. Copyright ©
Slide 18: Strong Execution - Adjusted EBITDA ($M)
STRONG EXECUTION - ADJUSTED EBITDA(1) ($M) By Segments $368 13% $344 $324 FY 2018 $291 $273 89% 0% 18% FY 2017 82% 2014 2015 2016 2017 2018 Electricity Products Other (1) See appendix for Adjusted EBITDA reconciliation Copyright © 2019 Ormat Technologies, Inc. 18
Slide 19: Well Positioned to Support Growth
WELL POSITIONED TO SUPPORT GROWTH Total Debt ($M) Net Debt ($M)(1) $1,268 $1,001 $1,090 $920 $939 $914 509 $868 $817 324 273 280 305 $685 $674 677 666 759 640 609 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Project Finance Corporate Debt Net Debt(1) to Capitalization Net Debt to Adjusted EBITD
Slide 20: Investment Highlights
INVESTMENT HIGHLIGHTS Sustainable Efficient operation Well positioned ESG Investment growth • Market leader • Focus on increasing • Strong cash flow • Pure play in the • Substantial and growing efficiencies • Strong balance sheet renewable sustainable cash flow from operation • Improving margins • A
Slide 21: Thank You!
THANK YOU! Contact IR: Smadar Lavi VP Corporate Finance and Head of Investor Relations 775-356-9029 (ext. 65726) [email protected] Copyright Copyright©©2019 2019Ormat OrmatTechnologies, Technologies,Inc. Inc. 21
Slide 22: FY 2018 - Adjusted EBITDA ($M)
FY 2018 - ADJUSTED EBITDA1 ($M) Total adjusted EBITDA Electricity segment Product segment Other segment $24.1M (7%) +$43.9M (15.5%) -$14.3M (-23.3%) $343.8 $368.0 $327.6 $283.7 89% of total adjusted EBITDA 83% of total adjusted EBITDA $61.5 $47.2 2017 2018 2017 2018 2017 2018 2017 2018 ($1.4) ($6.8)
Slide 23: Reconciliation of EBITDA and Adjusted EBITDA
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA FOR THE THREE AND TWELVE MONTHS PERIODS ENDED DECEMBER 31, 2018 AND 2017 (UNAUDITED) We calculate EBITDA as net income before interest, taxes, depreciation and amortization. We calculate Adjusted EBITDA as net income before interest, taxes, depreciation a
Slide 24: 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, 2017, 2016, 2015 and 2014. Year Ended December 31, 2017 2016 2015 2014 Net Income.............................................
Slide 25: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES Year Ended December 31 2018 2017 2016 2015 2014 Cash and cash equivalents and Restricted cash (in millions $) Cash and cash equivalents 99 48 230 186 40 Restricted cash and cash equivalents 79 49 34 50 93 178 97 264 235 133 Total Debt (in millions $) Cur
Slide 26: Why Geothermal
WHY GEOTHERMAL Renewabl e • Supporting legislation • Growing demand Global potential • Estimated 9x the installed capacity Competitive • Firm & flexible • Cost effective High entry barriers • Niche market • Capital intensive • Expertise Copyright © 2019 Ormat Technologies, Inc. 26
Slide 27: Air-Cooled Binary Geothermal Power Plant
AIR-COOLED BINARY GEOTHERMAL POWER PLANT Copyright © 2019 Ormat Technologies, Inc. 27
Slide 28: Strategic Plan to Increase Shareholders Value
STRATEGIC PLAN TO INCREASE SHAREHOLDERS VALUE Improve Organic Strategic New efficiencies growth M&A activities Copyright © 2019 Ormat Technologies, Inc. 28
Slide 29: Improve Efficiencies - The Numbers Tell It All
IMPROVE EFFICIENCIES - THE NUMBERS TELL IT ALL Increasing efficiencies across the entire value chain CapEx reduction Electricity segment Operating cost (2) gross margin ($/MWh) Reduced the Improved from Reduced from CapEx/MW from $4.5M-$5M 29% in 2013 to $34/MWh in 2013 to 42% in 2018 (1) to $4M-$4.
Slide 30: Providing Integrated Distributed Energy Resources (DER) Services
PROVIDING INTEGRATED DISTRIBUTED ENERGY RESOURCES (DER) SERVICES Funding & EPC Customer BSAAS /DRAAS Electric grid Systems Software Copyright © 2019 Ormat Technologies, Inc. 30
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