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Ormat Technologies Reports First Quarter 2012 Results
Record quarterly revenues of $132.4 million and cash flow from operations of $41.9 million;

RENO, Nev., May 8, 2012 /PRNewswire/ -- Ormat Technologies, Inc. (NYSE: ORA) today announced financial results for the first quarter of 2012.

Quarterly highlights and recent developments:

  • Total revenues increased 35 percent to $132.4 million;
  • Cash flow from operations of $41.9 million;
  • Operating income of $25.7 million and EBITDA of $51.5 million;
  • Gross margin percentage 30.1 percent compared to 15.3 percent during same period last year; and
  • Robust product backlog of $207 million as of May 8, 2012.

Commenting on the results, Dita Bronicki, Chief Executive Officer of Ormat, stated: "We had a very good first quarter.  Total revenues increased 35 percent year-over-year, while our combined gross margin almost doubled from the same period last year.  Net income significantly improved and we continued to invest in our long-term growth strategy.

"The good results of the quarter are a testament to the continued progress that we have made in both our electricity and product segments.  On the electricity side, we see the result of the well field and equipment improvement which increased generation and reduced operating costs. On the product side, we have successfully translated our technological leadership and proven execution abilities into a substantial backlog."

Financial Summary
For the three months ended March 31, 2012, total revenues increased 35.3 percent to $132.4 million from $97.8 million in the first quarter of 2011.  Product revenues more than doubled to $50.1 million, from $19.6 million in the three months ended March 31, 2011.  Electricity revenues increased 5.1 percent to $82.2 million, up from $78.3 million in the three months ended March 31, 2011.

Operating income for the three months ended March 31, 2012 increased by $22.6 million to $25.7 million from $3.1 million for the three months ended March 31, 2011. The increase is principally attributable to higher rates and lower operating costs in our electricity segment and higher volumes of customer orders in our product segment.

For the quarter, the company reported net income of $8.0 million, or $0.17 per share (basic and diluted), compared to net loss of $9.0 million, or $0.20 per share (basic and diluted), for the same quarter a year ago. The increase is principally attributable to the $22.6 million increase in operating income.

EBITDA for the first quarter of 2012 was $51.5 million, compared to $27.2 million in the same quarter last year. The reconciliation of GAAP net cash provided by operating activities to EBITDA and additional cash flows information is set forth below.

As of March 31, 2012, cash, cash equivalents and marketable securities were $100.3 million. In addition, as of March 31, 2012, the company has available committed lines of credit with commercial banks aggregating $420.0 million, of which $52.6 million is unused.

On May 8, 2012, Ormat's Board of Directors approved the payment of a quarterly dividend of $0.04 per share pursuant to the company's dividend policy, which targets an annual payout ratio of at least 20% of the company's net income.  The dividend will be paid on May 30, 2012 to shareholders of record as of the close of business on May 21, 2012.  The company expects to pay a dividend of $0.04 per share in the next two quarters.

Commenting on the outlook for 2012, Ms. Bronicki said, "We currently expect our 2012 product revenues to be $165 to $175 million. We are maintaining our electricity forecast of $315 to $330 million. The wide range is due to the uncertainty around natural gas prices."

Conference Call Details
Ormat will host a conference call to discuss its financial results and other matters discussed in this press release at 9:00 A.M. EDT on Wednesday, May 9, 2012.  The call will be available as a live, listen-only webcast at www.ormat.com. During the webcast, management will refer to slides that will be posted on the web site. The slides and accompanying webcast can be accessed through the Webcast & Presentations in the Investor Relations section of Ormat's website.

The webcast will be available approximately two hours after the conclusion of the live call. A replay will be available from 12 p.m. EDT on May 9, 2012. Please call: (877) 258-8832 (U.S. and Canada) (404) 537-3406 (International) and enter the Reply code: 72895260.

About Ormat Technologies
Ormat Technologies, Inc. is the only vertically-integrated company primarily engaged in the geothermal and recovered energy power business. The company designs, develops, owns and operates geothermal and recovered energy-based power plants around the world. Additionally, the company designs, manufactures and sells geothermal and recovered energy power units and other power-generating equipment, and provides related services. The company has more than four decades of experience in the development of environmentally-sound power, primarily in geothermal and recovered-energy generation. Ormat products and systems are covered by 82 U.S. patents. Ormat has engineered and built power plants that it currently owns or has supplied to utilities and developers worldwide, totaling approximately 1,430 MW of gross capacity.  Ormat's current generating portfolio includes the following geothermal and recovered energy-based power plants: in the United States - Brady, Brawley, Heber, Jersey Valley, Mammoth, Ormesa, Puna, Steamboat, Tuscarora, OREG 1, OREG 2, OREG 3, and OREG 4; in Guatemala - Zunil and Amatitlan; in Kenya – Olkaria III; and, in Nicaragua - Momotombo.

Ormat's Safe Harbor Statement
Information provided in this press release may contain statements relating to current expectations, estimates, forecasts and projections about future events that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally relate to Ormat's plans, objectives and expectations for future operations and are based upon its management's current estimates and projections of future results or trends. Actual future results may differ materially from those projected as a result of certain risks and uncertainties. For a discussion of such risks and uncertainties, see "Risk Factors" as described in Ormat Technologies, Inc.'s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 29, 2012.

These forward-looking statements are made only as of the date hereof, and we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Ormat Technologies Contact:

Investor Relations Contact:

Dita Bronicki

Todd Fromer/Rob Fink

CEO

KCSA Strategic Communications

775-356-9029

212-896-1215 (Todd) /212-896-1206 (Rob)

dbronicki@ormat.com

tfromer@kcsa.com / rfink@kcsa.com



Ormat Technologies, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

For the Three-Month Periods Ended March 31, 2012 and 2011

(Unaudited)




Three Months Ended March 31,


2012


2011








(In thousands, except per share data)

Revenues:






   Electricity

$

82,247


$

78,268

   Product


50,105



19,552

      Total revenues


132,352



97,820

Cost of revenues:






   Electricity


57,931



65,937

   Product


34,627



16,890

      Total cost of revenues


92,558



82,827

      Gross margin


39,794



14,993

Operating expenses:






   Research and development expenses


1,048



2,207

   Selling and marketing expenses


4,922



2,660

   General and administrative expenses


7,314



7,007

   Write-off of unsuccessful exploration activities


768



      Operating income


25,742



3,119

Other income (expense):






   Interest income


388



135

   Interest expense, net


(14,878)



(13,080)

   Foreign currency translation and transaction gains (losses)


14



517

   Income attributable to sale of tax benefits


2,517



2,139

   Other non-operating expense, net


(161)



(797)

      Income (loss), before income taxes and equity in






         losses of investees


13,622



(7,967)

Income tax provision


(5,457)



(586)

Equity in losses of investees, net


(140)



(412)

      Net income (loss)


8,025



(8,965)

      Net income attributable to noncontrolling interest


(130)



(10)

      Net income (loss) attributable to the Company's stockholders

$

7,895


$

(8,975)







Earnings (loss) per share attributable to the Company's stockholders — basic and diluted:

$

0.17


$

(0.20)

Weighted average number of shares used in computation of earnings per share

attributable to the Company's stockholders:






   Basic


45,431



45,431

   Diluted


45,437



45,431



Ormat Technologies, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

As of March 31, 2012 and December 31, 2011

(Unaudited)








March 31,


December 31,



2012


2011




(In thousands)

ASSETS

Current assets:







   Cash and cash equivalents


$

84,580


$

99,886

   Marketable securities



15,719



18,521

   Restricted cash, cash equivalents and marketable securities



75,145



75,521

      Receivables:







         Trade



43,545



51,274

         Related entity



307



287

         Other



8,058



9,415

   Due from Parent



123



260

   Inventories



17,200



12,541

   Costs and estimated earnings in excess of billings on uncompleted contracts



8,618



3,966

   Deferred income taxes



2,315



1,842

   Prepaid expenses and other



19,863



18,672

            Total current assets



275,473



292,185

Unconsolidated investments



3,732



3,757

Deposits and other



22,940



22,194

Deferred charges



40,066



40,236

Property, plant and equipment, net



1,505,543



1,518,532

Construction-in-process



413,998



370,551

Deferred financing and lease costs, net



28,054



28,482

Intangible assets, net



37,963



38,781

            Total assets


$

2,327,769


$

2,314,718

LIABILITIES AND EQUITY

Current liabilities:







   Accounts payable and accrued expenses


$

98,993


$

105,112

   Billings in excess of costs and estimated earnings on uncompleted contracts



32,155



33,104

   Current portion of long-term debt:







      Limited and non-recourse:







         Senior secured notes (non-recourse)



22,247



21,464

         Other loans



13,612



13,547

      Full recourse



20,647



20,543

            Total current liabilities



187,654



193,770

Long-term debt, net of current portion:







   Limited and non-recourse:







      Senior secured notes (non-recourse)



340,374



341,157

      Other loans



99,921



100,585

   Full recourse:







      Senior unsecured bonds



249,964



250,042

      Other loans



60,273



63,623

      Revolving credit lines with banks (full recourse)



227,642



214,049

Liability associated with sale of tax benefits



64,383



69,269

Deferred lease income



68,321



68,955

Deferred income taxes



59,399



54,665

Liability for unrecognized tax benefits



6,409



5,875

Liabilities for severance pay



21,674



20,547

Asset retirement obligation



21,697



21,284

Other long-term liabilities



4,021



4,253

            Total liabilities



1,411,732



1,408,074








Equity:







   The Company's stockholders' equity:







      Common stock



46



46

      Additional paid-in capital



727,403



725,746

      Retained earnings



180,226



172,331

      Accumulated other comprehensive income



518



595




908,193



898,718

   Noncontrolling interest



7,844



7,926

      Total equity



916,037



906,644

      Total liabilities and equity


$

2,327,769


$

2,314,718



Ormat Technologies, Inc. and Subsidiaries

Reconciliation of EBITDA and Additional Cash Flows Information

For the Three-Month Periods Ended March 31, 2012 and 2011

(Unaudited)


We calculate EBITDA as net income before interest, taxes, depreciation and amortization. EBITDA is not a measurement of financial performance or liquidity under accounting principles generally accepted in the United States of America and should not be considered as an alternative to cash flow from operating activities or as a measure of liquidity or an alternative to net earnings as indicators of our operating performance or any other measures of performance derived in accordance with accounting principles generally accepted in the United States of America. EBITDA is presented because we believe it is frequently used by securities analysts, investors and other interested parties in the evaluation of a company's ability to service and/or incur debt. However, other companies in our industry may calculate EBITDA differently than we do. The following table reconciles net cash provided by operating activities to EBITDA for the three-month periods ended March 31, 2012 and 2011:





Three Months Ended March 31,



2012


2011



 (in thousands) 

Net cash provided by operating activities


$

41,874


$

13,066

Adjusted for:







Interest expense, net (excluding amortization







      of deferred financing costs)



13,647



12,296

Interest income



(388)



(135)

Income tax provision (benefit)



5,457



586

Adjustments to reconcile net income or loss to net cash 







  provided by operating activities (excluding 







  depreciation and amortization)



(9,105)



1,339

EBITDA


$

51,485


$

27,152

Net cash used in investing activities


$

(62,333)


$

(107,924)

Net cash provided by  financing activities


$

5,153


$

52,718

Depreciation and amortization


$

24,744


$

23,370

SOURCE Ormat Technologies, Inc.

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