Ormat Technologies, Inc. · NYSE:ORA

Ormat Technologies — Investor Presentation (November 2022)

40 slides from Ormat Technologies's investor presentation, November 2022

  1. Slide 1: Ormat Technologies, Inc. Investor Presentation November 2022

    ORMAT TECHNOLOGIES, INC. INVESTOR PRESENTATION NOVEMBER 2022 Copyright Copyright©©2022 2022Ormat 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 © 2022 Ormat Technologies, Inc. 3

  4. Slide 4: A leading renewable energy provider in geothermal and energy storage

    A LEADING RENEWABLE ENERGY PROVIDER Over Own & operate WITH A PROVEN TRACK RECORD IN GEOTHERMAL & ENERGY STORAGE 55 ~1.2GW Years of experience Geothermal, Storage, Solar PV & REG(1) 1,400 $ 720M Employees LTM revenues (4) $ 427M $ 67M LTM adj. EBITDA(2) LTM Net income(3) (1) REG – Recovered Energy G

  5. Slide 5: Our Business Segments

    OUR BUSINESS SEGMENTS 88% 8% 4% 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: Recent Development – Year-to-Date

    RECENT DEVELOPMENT – YEAR-TO-DATE 1 ELECTRICITY 2 PRODUCTS 3 STORAGE 4 CORPORATE Up to 285MW ~$ 100M 5MW /20MWh $ 506M New PPAs New contracts Started operation in Debt raising at Q2 average 2.5% coupon 73MW ~$ 137M Signed a 15 years Joined S&P Mid Cap 400 Started operation backlog PPA for 80MW/ inde

  7. Slide 7: Electricity

    ELECTRICITY Generates firm & flexible power Copyright © 2022 Ormat Technologies, Inc. 7

  8. Slide 8: Electricity Overview

    ELECTRICITY OVERVIEW 5 4 Diversified 1 2 3 6 portfolio 72% 28% U.S. International 2021 Geographic 01 U.S. 02 Guatemala 03 Honduras breakdown 800 MW 40 MW 38 MW of revenues 04 Guadeloupe 05 Kenya 06 Indonesia 15 MW 150 MW 42 MW(1) $631 $586 Global operation $510 $540 $541 Profitable $436 $466 94% geo

  9. Slide 9: Geothermal Market

    GEOTHERMAL MARKET Ormat -the 2nd largest geothermal owner & operator ~16 GW Global Installed geothermal capacity 9x Global Potential vs. Installed EU Africa ASIA Oceania U.S LATAM Installed 3.6 0.9 4.9 1.0 3.7 1.7 Potential 7.2 5.1 74.3 3.6 35.0 36.4 Source of above charts: Geothermal Power Market F

  10. Slide 10: A Strong Tailwind: PPAs

    A STRONG TAILWIND 3 PPAs With NV Energy (NV) Increase in demand to drive potential upside on PPA pricing and with CC Power (CA)2 For up to 285 MW Cover new projects in NV and CA and renewal of PPAs in NV Geothermal goals: CPUC – 1GW (2) NV Energy - 500MW (3) LADWP(4) – 0.5GW- Illustrates the demand

  11. Slide 11: Strong Tailwind: Inflation Reduction Act

    STRONG TAILWIND INFLATION REDUCTION ACT Extension of Geothermal and solar tax credits 1 for projects beginning construction before January 1, 2025 AUG 16 New tax credit rate structure 2022 IRA signed 2 New geothermal projects can receive up to 3.37 cents per kWh based on compliance with new wage req

  12. Slide 12: Ormat's Development in Indonesia

    ORMAT’S DEVELOPMENT IN INDONESIA 12.75% SARULLA TOKA TINDUNG #1 4th ownership 42MW Under development: Largest Largest in operation initial drilling economy in country in the 75- Southeast Asia1 world 2 100% ownership BBB/Baa2 ~33GW 100% Country’s 2020 electricity ownership rating by S&P production4

  13. Slide 13: Summary Electricity Segment Growth Drivers

    SUMMARY ELECTRICITY SEGMENT GROWTH DRIVERS TARGETED PORTFOLIO GROWTH (GW) ~1.2 1.1 1.0 0.9 2019 2021 As of 9/30/22 2023E (1) Geothermal Solar PV Note: Please see appendix for detailed list of projects including MW and MWh numbers of the respective projects. Copyright © 2022 Ormat Technologies, Inc.

  14. Slide 14: Storage

    STORAGE Enables stability of the grid and flexibility Copyright © 2022 Ormat Technologies, Inc. 14

  15. Slide 15: Steep Market Growth Trajectory

    STEEP MARKET GROWTH TRAJECTORY U.S. FTM storage is expected to reach 49,904 49 GW in 2026 39,273 22x from 2020 29,215 50 % 18,815 of projected growth from California & Texas 9,405 5,185 2,201 1,092 2019 2020 2021E 2022E 2023E 2024E 2025E 2026E California Texas Nevada Arizona Hawaii New York PJM (& N

  16. Slide 16: Regulatory and Policy Drivers

    REGULATORY AND POLICY DRIVERS State-level Energy Storage Targets CPUC1: Oregon Nevada New York Maine Massachusetts Procure additional 15 GW 10 MWh(2) 1 GW 6 GW 400 MW 1 GW by by 2030 by 2030 by 2030 YE 2025 of new storage and demand response 9 states have energy resources by 2032 storage targets IRA

  17. Slide 17: Storage Segment

    STORAGE SEGMENT Current operating capacity 88MW/196MWh 01 CA (3 facilities) 02 TX 35MW/140MWh 10MW/10MWh TARGET THE LARGEST AND MOST 1 LUCRATIVE MARKETS: 03 NJ (2 facilities) 04 VT California, Texas, and PJM 41MW/41MWh 2MW/5MWh 4 FOCUS ON STANDALONE ENERGY 1 3 2 STORAGE Providing ancillary service,

  18. Slide 18: Storage Energy Under Development

    STORAGE ENERGY UNDER DEVELOPMENT: 7 projects, 184 MW/444MWh, all secured for battery supply and revenue source Projected Projected Expected State Project PPA Capacity (MW) MWh COD 2022 TX 1 Upton 25 25 Q4 2022 Merchant Capacity PPA OH 2 Bowling Green 12 12 Q1 2023 and Merchant 3 Andover NJ 27 27 Q1

  19. Slide 19: Leveraging Market Expertise to Build Storage Pipeline

    LEVERAGING OUR MARKET EXPERTISE TO ENHANCE AND BUILD STORAGE PIPELINE 2.9 GW 34 named projects 2.1 GW 30 named projects 1.2 GW 33 named projects 0.3 GW 19 named projects 2019 2020 2021 Q3 2022 Copyright © 2022 Ormat Technologies, Inc. 19

  20. Slide 20: Leveraging BD Efforts to Grow Our Portfolio

    LEVERAGING BD EFFORTS TO GROW OUR PORTFOLIO Ormat energy storage development (MW) Ormat energy storage development (MWh) 1,850-2,250 700-800 60%-66% CAGR 53%-57% CAGR 273 640 83 88 176 196 2021 Current 2023E 2026E 2021 Current 2023E 2026E Operational Incremental Copyright © 2022 Ormat Technologies,

  21. Slide 21: Product

    PRODUCT Vertical integration advantage Copyright © 2022 Ormat Technologies, Inc. 21

  22. Slide 22: Product Segment Overview

    PRODUCT SEGMENT OVERVIEW Primary provider of geothermal binary plants Suppliers of geothermal power plants 2018 – 2022 capacity, MW Market leader Built approx. 190 power plants and installed approx. 60% 73% 3,200 MW of geothermal & REG over the years Binary Ormat 1,824 1,101 MW MW TOTAL BINARY 3rd p

  23. Slide 23: Ormat's Growth Targets

    ORMAT’S GROWTH TARGETS Copyright © 2022 Ormat Technologies, Inc. 23

  24. Slide 24: Ormat Portfolio Growth Targets

    ORMAT PORTFOLIO GROWTH TARGETS (GW) 2.15-2.3 14-16% 700-800 MW CAGR Storage 1.5 1.1 1.17 1,445-1,550 MW Electricity: Geothermal Solar 2021 As of September 30, 2023E 2026E 2022 Geothermal Solar Storage 24 Note: Please see appendix for detailed list of projects including MW and MWh numbers of the resp

  25. Slide 25: MW and Adjusted EBITDA Expectations

    MW EXPECTATIONS ADJUSTED EBITDA EXPECTATIONS ~1.5GW ~$500M run-rate(2) 1.1GW $401M (1) 2021 2022 2023 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 © 2022 Ormat Technologies, Inc. 25

  26. Slide 26: Financial Position & Summary

    FINANCIAL POSITION & SUMMARY Copyright © 2022 Ormat Technologies, Inc. 26

  27. Slide 27: Strong Financial Positioning

    STRONG FINANCIAL POSITIONING Electricity and Energy Storage Segments Installed Capacity (MW) Revenue ($M) Geothermal REG Solar Storage 1,173 1,095 $660 $616 957 1,005 $555 $557 931 $518 795 $469 2017 2018 2019 2020 2021 As Of September 2017 2018 2019 2020 2021 LTM 30, 2022 Adjusted EBITDA ($M)(1) $4

  28. Slide 28: Strong Financial Positioning

    STRONG FINANCIAL POSITIONING Total Debt ($M) Net Debt ($M)(1) $2,012 $1,908 $1,759 $1,456 $1,521 $1,268 $1,238 $1,090 $1,085 $919 2018 2019 2020 2021 September 2018 2019 2020 2021 September 30, 2022 30, 2022 Project Finance Finance liability Corporate Debt Net Debt to Capitalization (Total Equity) (

  29. Slide 29: Maintaining a Strong Capital Position to Support Growth

    MAINTAINING A STRONG CAPITAL POSITION TO HELP SUPPORT GROWTH ~$427M ~$2B Adj. EBITDA for Total equity the LTM $ 640M (1) Cash, cash equivalents, restricted cash and available lines of credit Access to various 47% 4.1x sources of capital Net debt to Net debt to capitalization (2) Adj. EBITDA(2) (1) E

  30. Slide 30: ESG Initiatives

    ENVIRONMENT GOVERNANCE ESG INITIATIVES We are moving to strengthen our ESG commitments Building our approach and policy on significant valuable issues SOCIAL We issued our ESG report, the fourth in accordance with GRI standards and the second 22% according to SASB framework. Absolute reduction in sc

  31. Slide 31: Investment Highlights

    INVESTMENT HIGHLIGHTS STABLE AND GROWING CASH FLOW GROWING VISIBLE CASHFLOW SUPPORTED BY LONG TERM CONTRACTS GLOBAL MACRO ECONOMIC TAILWINDS INFLATION REDUCTION ACT GROWTH VISIBILITY SIGNED UP TO 285MW NEW LONG-TERM PPAS FOR 2024-2028 NEW DEVELOPMENTS AND RENEWALS OF EXPIRING CONTRACTS GROWING OUR E

  32. Slide 32: Appendix

    APPENDIX Copyright © 2022 Ormat Technologies, Inc. 32

  33. Slide 33: 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 years ended December 31, 2021, 2020, 2019, 2018, and 2017. Year Ended December 31, 2021 2020 2019 2018 2017 (Dollars in thousands) Net income 76,077 101,806 93,543 11

  34. Slide 34: Reconciliation of EBITDA and Adjusted EBITDA

    RECONCILIATION OF EBITDA AND ADJUSTED EBITDA (DOLLARS IN THOUSANDS) Nine-Months Three Months LTM Ended September Ended September 30, 30, As of September 2022 2021 2021 30, 2022 2022 Net income 79,837 19,826 20,780 57,564 53,804 Adjusted for: Interest expense, net (including amortization of deferred

  35. Slide 35: Reconciliation of Non-GAAP Financial Measures

    RECONCILIATION OF NON-GAAP FINANCIAL MEASURES Year Ended December 31 September 30, 2021 2020 2019 2018 2022 Cash and cash equivalents, marketable securities and Restricted cash (in millions $) Cash and cash equivalents 155 239 448 71 99 Marketable Securities at fair value 0 43 Restricted cash and ca

  36. Slide 36: CapEx for 2022

    CAPEX FOR 2022 ACTUAL INVESTED TOTAL CAPEX TOTAL CAPEX ($M) IN 9 MONTHS 2022 FOR Q4 2022 FOR 2022 Electricity Segment 326 135 465 Construction & Enhancements – fully released 207 88 295 Development enhancement, drillings and Exploration 57 19 76 Puna restoration (including drilling) 20 8 28 Olkaria

  37. Slide 37: Products Segment Third-Party Backlog

    12% 3% 62% PRODUCTS New Zealand 6% SEGMENT Philippines 3% THIRD-PARTY Far East 2% 3% BACKLOG(1) Guatemala $137.1M IL 3% USA 6% Germany CONTRACTS GEOGRAPHIC BREAKDOWN Taiwan 97.1% Geothermal contracts Others (1) Backlog as of November 3, 2022. The backlog Includes revenues for the period between Octo

  38. Slide 38: Air-Cooled Binary Geothermal Power Plant

    AIR-COOLED BINARY GEOTHERMAL POWER PLANT Copyright © 2022 Ormat Technologies, Inc. 38

  39. Slide 39: Geothermal Under Development

    GEOTHERMAL UNDER DEVELOPMENT: 6 projects, 60-65 MW by 2023 Expected Projected Country/State Project COD PPA Capacity (MW) 1 U.S - North NV Valley 25 Q1 2023 ✓ U.S. – Dixie 2 4 Q2 2023 ✓ Valley U.S - Heber CA 3 Complex 11 Q2 2023 ✓ 2023 4 U.S. - North 5-10 Q4 2023 ✓ Valley 2 Guatemala 5 Zunil 5 H1 20

  40. Slide 40: Solar Energy Under Development

    SOLAR ENERGY UNDER DEVELOPMENT: 5 projects, 35 MW AC by 2023 Projected Expected State Project PPA Capacity (MW) COD 1 Brady Solar 6 AC Q1 2023 ✓ Steamboat 2 5 AC Q1 2023 ✓ 2023 Solar NV North Valley 3 7 AC Q2 2023 ✓ Solar McGinness Hills 4 14 AC H2 2023 ✓ Solar 5 Steamboat Hills 3 AC Q3 2023 ✓ Solar

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