Ormat Technologies, Inc. · NYSE:ORA
Ormat Technologies — FY2019 Earnings Presentation
29 slides from Ormat Technologies's earnings presentation, March 2020
Slide 1: Ormat Technologies Inc. Investor Presentation March 2020
ORMAT TECHNOLOGIES INC. INVESTOR PRESENTATION MARCH 2020 Copyright Copyright©©2020 2020Ormat 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 2022 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 55 years ~1,410 Own & operate 914 MW of experience Employees Generating Capacity 746$M FY2019 revenues 43MW/46MW 384$M h of operating stora
Slide 5: Summary – Continuing Execution
SUMMARY – CONTINUING EXECUTION Improve Organic Strategic New efficiencies growth M&A activities Electricity segment gross Secured over Adjusted EBITDA(4) margin 242 margin increased to: 52% 42% $M capital to support growth plan(1) Energy Storage pipeline Geothermal & Solar Growth 150-200 MW 180-200
Slide 6: The World's Only Vertically Integrated Geothermal Company – Electricity Segment
THE WORLD’S ONLY VERTICALLY INTEGRATED GEOTHERMAL COMPANY Electricity segment Development Drilling Engineering Manufacturing Construction Operation Customers: & exploration Utilities, CCA and Municipalities 70% of total revenues (1) (1) Average 2017-2019 Copyright © 2020 Ormat Technologies, Inc. 6
Slide 7: The World's Only Vertically Integrated Geothermal Company – Product Segment
THE WORLD’S ONLY VERTICALLY INTEGRATED GEOTHERMAL COMPANY Product segment Development Drilling Engineering Manufacturing Construction Operation Customers: & exploration Utilities and Developers 29% of total revenues (1) (1) Average 2017-2019 Copyright © 2020 Ormat Technologies, Inc. 7
Slide 8: Vertical Integration as a Platform to Grow in the Storage Market
VERTICAL INTEGRATION AS A PLATFORM TO GROW IN THE STORAGE MARKET Energy Storage & Management Services segment Development Engineering Procurement Construction Operation Development Inverter and Pipeline battery 1% of total revenues (1) (1) Average 2017-2019 Copyright © 2020 Ormat Technologies, Inc.
Slide 9: Electricity Segment Overview
ELECTRICITY SEGMENT OVERVIEW Stable, well managed, cash generating assets • Global operation of 914 MW at 25 sites Global portfolio (914 MW) • 93% geothermal, 6% REG and 1% solar • Weighted average PPA life: 17 years(1) Annual revenue ($M) U.S. Guadeloupe 629 MW 15 MW (3) Guatemala Indonesia $510 (4
Slide 10: Product Segment Overview
PRODUCT SEGMENT OVERVIEW Built approximately 190 power plants and installed over 3,000 MW of geothermal & REG over the years • Backlog of approximately $142 million as of February 25, 2020 • Continuing improving engineering, technology and delivery lead-time (1) Revenue from 3rd party sales ($M) Bac
Slide 11: Energy Storage and Management Services Overview
ENERGY STORAGE AND MANAGEMENT SERVICES OVERVIEW Holistic offering that combines energy storage and energy management • 50 highly experienced staff • Operating Portfolio • 43MW/46MWh operating assets • Plumsted and Stryker – connected to PJM Interconnect • Hinesburg – connected to ISONE • ACUA – conn
Slide 12: Growth Plan – Geothermal and Solar
GROWTH PLAN – GEOTHERMAL AND SOLAR • Added 7 MW from Tungsten Solar in Nevada during 2019 • Expect adding between 180 MW and 200 MW by the end of 2022(1) Expected Project Expected COD PPA Capacity (MW) Geothermal Projects U.S - Steamboat Hills Enhancement 19 2020 H1 U.S - Heber Complex 11 Early 20
Slide 13: PTC Extender – Driver for Growth in the United States
PTC EXTENDER – DRIVER FOR GROWTH IN THE UNITED STATES • In December 2019, the tax extenders package was signed into law and retroactively revived, extending the full PTC for geothermal facilities • Continues U.S. support for the geothermal industry. • PTC provides a tax credit of 2.5 cents per kWh o
Slide 14: Growth Plan – Energy Storage and Management Services
GROWTH PLAN - ENERGY STORAGE AND MANAGEMENT SERVICES Holistic offering that combines energy storage, demand response and energy management Projects released for construction • Rabbit Hills, Texas (10 MW / 12.5 MWh) • Finalizing market testing to get ERCOT’s approval to provide ancillary services; st
Slide 15: Funding Growth – Secured $242 Million of Capital
FUNDING GROWTH – SECURED $242 MILLION OF CAPITAL Successfully raised $242 million since the beginning of 2019 • $59.3M tax partnership transaction of McGinness Hills phase 3 • $50.0M of commercial paper • Three months LIBOR + 0.75%, issued for 90 days and extends automatically for additional periods
Slide 16: Strong Execution – Revenue ($M)
STRONG EXECUTION - REVENUE ($M) $746 $719 $693 $663 7 15 3 $595 191 202 224 226 219 510 540 436 466 376 2015 2016 2017 2018 2019 Electricity Products Energy Storage and management services Copyright © 2020 Ormat Technologies, Inc. 16
Slide 17: Strong Execution – Adjusted EBITDA ($M)
STRONG EXECUTION - ADJUSTED EBITDA(1) ($M) By Segments -1% 13% FY 2018 FY 2018 $384 $368 $344 $324 88% $291 0% 9% FY 2019 91% 2015 2016 2017 2018 2019 Electricity Products Energy Storage and management services (1) See appendix for Adjusted EBITDA reconciliation. Copyright © 2020 Ormat Technologies,
Slide 18: Well Positioned to Support Growth
WELL POSITIONED TO SUPPORT GROWTH Total Debt ($M) Net Debt ($M)(1) $1,268 $1,238 $1,090 $1,085 $920 $939 $914 $817 509 522 $685 $674 280 273 305 640 666 759 716 609 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Project Finance Corporate Debt Net Debt to Adjusted EBITDA(1) Net Debt(1) to Capitali
Slide 19: Investment Highlights
INVESTMENT HIGHLIGHTS Sustainable Efficient operation Well positioned ESG Investment growth • Substantial and growing • Focus on increasing • Market leader • Pure play in the cash flow from operation efficiencies • Strong cash flow renewable sustainable • Growth from identified • vertical integratio
Slide 20: 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©©2020 2020Ormat OrmatTechnologies, Technologies,Inc. Inc. 20
Slide 21: Update on Puna Plant in Hawaii
UPDATE ON PUNA PLANT IN HAWAII • Working rapidly to resume operation of our Puna power plant following the volcanic eruption • Commercial operation of the full generating capacity is expected in the third quarter2020 • Assuming all other permits are received, transmission line upgrade is complete an
Slide 22: Air-Cooled Binary Geothermal Power Plant
AIR-COOLED BINARY GEOTHERMAL POWER PLANT Copyright © 2020 Ormat Technologies, Inc. 22
Slide 23: Worldwide Geothermal Installed Capacity 2015-2019
WORLDWIDE GEOTHERMAL INSTALLED CAPACITY 2015-2019 444 MW 1250 MW 16% 44% 700 614 2,817 MW 600 555 TOTAL 1124 MW 500 40% 400 342 MW 300 STG Binary - Ormat Binary - Others 220 200 180 158 136 100 53 44 45 54 41 55 16 15 28 20 16 2 2 0 12 4 - Binary - Ormat Binary - Others STG Total Source: Ormat Copyr
Slide 24: Market Opportunities for Geothermal Growth
MARKET OPPORTUNITIES FOR GEOTHERMAL GROWTH Full Geothermal potential is more than 10x the installed capacity Europe Europe 3.4 GW 7.2 GW U.S U.S Asia pacific Asia pacific 3.6 GW 35 GW 4.7 GW 74.3 GW Africa Africa 0.8 GW 5.1 GW LATAM LATAM Ring of Fire 1.7 GW 36.4 GW Oceania Oceania 1.0 GW 3.6 GW Are
Slide 25: Market Share – Electricity Segment
MARKET SHARE - ELECTRICITY SEGMENT MW Top 10 Geothermal owners & operators1 (MW) 1,400 45 40 1,200 35 1,000 30 800 25 20 600 15 400 10 200 5 0 0 EDC (PNOC) Ormat/ CFE ENEL Star Energy Calpine Aboitiz Contact Mercury Terra-Gen worldwide Consortium Energy (ECP) Operation (MW) Estimated Project Count (
Slide 26: Market Share – Products Segment
MARKET SHARE - PRODUCTS SEGMENT Major geothermal equipment suppliers (MW & project count)1 4,000 140 3,500 120 3,000 100 2,500 80 2,000 60 1,500 40 1,000 500 20 0 2 0 Toshiba Mitsubishi Fuji Ormat Ansaldo/Tosi GE Alstom Exergy MW Operating Estimated Project Count (1) Source: Study based on Think Geo
Slide 27: Reconciliation of EBITDA and Adjusted EBITDA
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA FOR THE THREE AND TWELVE-MONTHS PERIODS ENDED DECEMBER 31, 2019 AND 2018 (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 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, 2017, 2016, 2015 and 2014. Copyright © 2020 Ormat Technologies, Inc. 28
Slide 29: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES Year Ended December 31 2019 2018 2017 2016 2015 Cash and cash equivalents and Restricted cash (in millions $) Cash and cash equivalents 71 99 48 230 186 Restricted cash and cash equivalents 82 79 49 34 50 153 178 97 264 235 Total Debt (in millions $) Cur