Ormat Technologies Reports Filing of Its Annual Report on Form 10-K for the Fiscal Year Ended December 31, 2017

No Change to the Operational Results Reported on March 1, 2018

Net Income Attributable to the Company’s Shareholders Was $155.5 Million

RENO, Nev., March 16, 2018 (GLOBE NEWSWIRE) -- Ormat Technologies, Inc. (NYSE:ORA) today filed its 2017 Annual Report on Form 10-K (“Form 10-K”) with the US Securities and Exchange Commission (the “SEC”).

The financial statements contained in the Form 10-K reflect no changes to the operational results we reported in our March 1, 2018 earnings release. That earnings release, however, did not include certain financial information affected by our tax accounts which we normally include in our year-end earnings release. That additional information is reflected in the chart below:

($ millions, except per share amounts)Q4
2017
Q4
2016
Change 2017 2016 Change
Revenues
Electricity$128.5 $114.6 12.1% $468.3 $436.3 7.3%
Product$37.9 $51.9 -27.0% $224.5 $226.3 -0.8%
Total Revenues$166.4 $166.5 -0.1% $692.8 $662.6 4.6%
Gross margin (%)
Electricity (1) 41.6% 39.7% 41.9% 40.0%
Product 28.7% 40.8% 32.2% 42.5%
Gross margin (%) 38.7% 40.0% 38.7% 40.9%
Operating income$48.4 $51.2 -5.5% $205.0 $201.9 1.6%
Income before income taxes and equity in losses of investees$40.0 $36.7 9.1% $170.7 $141.1 21.0%
Net income attributable to the Company’s shareholders$66.0 $28.2 133.7% $155.5 $93.9 65.5%
Diluted EPS$1.29 $0.56 $3.06 $1.87
Adjusted Net income attributable to the Company’s stockholders (2)$66.0 $28.2 133.7% $151.9 $109.9 38.2%
Adjusted Diluted EPS $1.29 $0.56 $2.99 $2.19
Adjusted EBITDA (3)$87.4 $76.9 13.6% $343.8 $323.8 6.2%
1 Electricity revenues for the full year ended December 31, 2017 includes $2.7 million of revenues and $5.4 million cost of revenues from Viridity. Electricity revenues for the fourth quarter of 2017 includes $0.5 million of revenues and $1.9 million cost of revenues from Viridity.
2 Adjusted Net income attributable to the Company’s shareholders for the full year 2017 excludes a net of $3.6 million related to; (1) a $5.5 million of a one-time benefit related to tax restructuring recorded in the second quarter of 2017, and (2) a $1.9 million expense attributable to a one-time make whole premium paid in connection with the prepayment of OFC Senior Secured Notes and DEG loan, recorded in the third quarter of 2017. Adjusted Net income attributable to the Company’s shareholders for the full year 2016 excludes $16 million related to: (1) $11.0 million of one-time settlement expenses and (2) $5.0 million of one-time prepayment fees, both recorded in the third quarter of 2016.
3 The way we compute Adjusted EBITDA and a reconciliation of GAAP net income to EBITDA and Adjusted EBITDA is set forth below in this release.

We have completed the additional review procedures related to accounting for income tax and financial reporting referenced in our March 1, 2018 press release, and the Form 10-K discloses the results of that review and the related remediation plan that we are in the process of implementing.

You can obtain copies of the Form 10-K, which contains our audited financial statements, as well as any of our other SEC filings from the SEC’s website (www.sec.gov).

ABOUT ORMAT TECHNOLOGIES

With over five decades of experience, Ormat Technologies, Inc. is a leading geothermal Company and the only vertically integrated company engaged in geothermal and recovered energy generation (REG), with the objective of becoming a leading global provider of renewable energy. The Company owns, operates, designs, manufactures and sells geothermal and REG power plants primarily based on the Ormat Energy Converter – a power generation unit that converts low-, medium- and high-temperature heat into electricity. With 77 U.S. patents, Ormat’s power solutions have been refined and perfected under the most grueling environmental conditions. Ormat has 530 employees in the United States and 770 overseas. Ormat’s flexible, modular solutions for geothermal power and REG are ideal for the vast range of resource characteristics. The company has engineered, manufactured and constructed power plants, which it currently owns or has installed to utilities and developers worldwide, totaling over 2,500 MW of gross capacity. Ormat’s current approximately 800 MW generating portfolio is spread globally in the U.S., Guatemala, Guadeloupe, Honduras, Indonesia and Kenya. Ormat also intends to expand its operations and provide energy management and energy storage solutions, by leveraging its core capabilities and global presence as well as through its Viridity Energy Solutions Inc. subsidiary, a Philadelphia-based Company with nearly a decade of expertise and leadership in demand response, energy management and storage.

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 Form 10-K filed with the SEC on March 16, 2018.

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, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
For the Three and Twelve-Month Periods Ended December 31, 2017 and 2016
(Unaudited)
Three Months Ended December 31 Year Ended December 31
2017 2016 2017 2016
(In thousands, except per share data) (In thousands, except per share data)
Revenues:
Electricity$128,503 $114,628 $468,329 $436,292
Product 37,862 51,891 224,483 226,299
Total revenues 166,365 166,519 692,812 662,591
Cost of revenues:
Electricity 75,017 69,163 272,266 261,573
Product 26,992 30,719 152,094 130,223
Total cost of revenues 102,009 99,882 424,360 391,796
Gross profit 64,356 66,637 268,452 270,795
Operating expenses:
Research and development expenses 789 732 3,157 2,762
Selling and marketing expenses 3,517 4,288 15,600 16,424
General and administrative expenses 9,854 10,085 42,881 46,710
Write-off of unsuccessful exploration activities 1,796 303 1,796 3,017
Operating income 48,400 51,229 205,018 201,882
Other income (expense):
Interest income 127 140 988 971
Interest expense, net (12,987) (15,828) (54,142) (67,389)
Derivatives and foreign currency transaction gains (losses) 614 (2,942) 2,654 (5,534)
Income attributable to sale of tax benefits 3,859 4,123 17,878 16,503
Other non-operating expense, net 12 (39) (1,666) (5,345)
Income before income taxes and equity in
losses of investees 40,025 36,683 170,730 141,088
Income tax (provision) benefit 29,669 (2,450) 1,411 (31,837)
Equity in losses of investees, net (267) (3,001) (1,957) (7,735)
Net income 69,427 31,232 170,184 101,516
Net income attributable to noncontrolling interest (3,467) (3,002) (14,695) (7,586)
Net income attributable to the Company's stockholders$65,960 $28,230 $155,489 $93,930
Earnings per share attributable to the Company's stockholders - Basic and diluted:
Basic:
Net Income $ 1.30 $ 0.57 $ 3.10 $ 1.90
Diluted:
Net Income $ 1.29 $ 0.56 $ 3.06 $ 1.87
Weighted average number of shares used in computation of earnings per share
attributable to the Company's stockholders:
Basic 50,607 49,647 50,110 49,469
Diluted 51,053 50,293 50,769 50,140


ORMAT TECHNOLOGIES, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheet
As of December 31, 2017, and 2016
(Unaudited)
December 31, December 31,
2017 2016
(In thousands)
ASSETS
Current assets:
Cash and cash equivalents $ 47,818 $ 230,214
Restricted cash, cash equivalents and marketable securities 48,825 34,262
Receivables:
Trade 110,410 80,807
Other 13,828 17,482
Inventories 19,551 12,000
Costs and estimated earnings in excess of billings on uncompleted contracts 40,945 52,198
Prepaid expenses and other 40,269 45,867
Total current assets 321,646 472,830
Investment in an unconsolidated company 34,084
Deposits and other 21,599 18,553
Deferred income taxes 20,135
Deferred charges 49,834 43,773
Property, plant and equipment, net 1,734,691 1,556,378
Construction-in-process 293,542 306,709
Deferred financing and lease costs, net 4,674 3,923
Intangible assets, net 85,420 52,753
Goodwill 21,037 6,650
Total assets $ 2,586,662 $ 2,461,569
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 153,796 $ 91,650
Short-term revolving credit lines with banks (full recourse) 51,500
Billings in excess of costs and estimated earnings on uncompleted contracts 20,241 31,630
Current portion of long-term debt:
Limited and non-recourse:
Senior secured notes 33,226 32,234
Other loans 21,495 21,495
Full recourse 3,087 12,242
Total current liabilities 283,345 189,251
Long-term debt, net of current portion:
Limited and non-recourse:
Senior secured notes 311,668 350,388
Other loans 242,385 261,845
Full recourse:
Senior unsecured bonds 203,752 203,577
Other loans 46,489 57,063
Accumulated losses of unconsolidated company in excess of investment 11,081
Liability associated with sale of tax benefits 44,634 54,662
Deferred lease income 51,520 54,561
Deferred income taxes 35,382
Liability for unrecognized tax benefits 8,890 5,738
Liabilities for severance pay 21,141 18,600
Asset retirement obligation 27,110 23,348
Other long-term liabilities 18,853 21,294
Total liabilities 1,259,787 1,286,790
Redeemable non-controlling interest 6,416 4,772
Equity:
The Company's stockholders' equity:
Common stock 51 50
Additional paid-in capital 888,778 869,463
Retained earnings (accumulated deficit) 351,622 216,644
Accumulated other comprehensive income (loss) (4,314) (7,732)
1,236,137 1,078,425
Noncontrolling interest 84,322 91,582
Total equity 1,320,459 1,170,007
Total liabilities and equity $ 2,586,662 $ 2,461,569


ORMAT TECHNOLOGIES, INC. AND SUBSIDIARIES
Reconciliation of EBITDA, Adjusted EBITDA and Additional Cash Flows Information
For the Three and Twelve-Month Periods Ended December 31, 2017 and 2016
(Unaudited)

We calculate EBITDA as net income before interest, taxes, depreciation and amortization. We calculate Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, adjusted for (i) termination fees, (ii) impairment of long-lived assets, (iii) write-off of unsuccessful exploration activities, (iv) any mark-to-market gains or losses from accounting for derivatives, (v) merger and acquisition transaction costs, (vi) stock-based compensation, (vii) gain from extinguishment of liability, and (viii) gain on sale of subsidiary and property, plant and equipment. EBITDA and Adjusted EBITDA are 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 and Adjusted EBITDA are presented because we believe they are 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 and Adjusted EBITDA differently than we do.

The following table reconciles net income to EBITDA and Adjusted EBITDA for the three-month and twelve-month periods ended December 31, 2017 and 2016.


Three Months Ended December 31 Year Ended December 31
2017 2016 2017 2016
(in thousands) (in thousands)
Net income $ 69,427 $ 31,232 $ 170,184 $ 101,516
Adjusted for:
Interest expense, net (including amortization
of deferred financing costs) 12,860 15,688 53,154 66,418
Income tax provision (29,669) 2,450 (1,411) 31,837
Adjustment to investment in unconsolidated company:
our proportionate share in interest, tax and depreciation and amortization (265) (265)
Depreciation and amortization 31,652 25,868 108,693 99,141
EBITDA $ 84,005 $ 75,238 $ 330,355 $ 298,912
Mark-to-market on derivatives instruments (700) (478) (1,500) 319
Stock-based compensation 1,556 1,774 8,760 5,157
Gain on sale of subsidiary and property, plant and equipment (686)
Loss from extinguishment of liability 1,950 5,780
Settlement expenses 11,000
Merger and acquisition transaction cost 760 100 2,460 335
Write-off of unsuccessful exploration activities 1,796 303 1,796 3,017
Adjusted EBITDA $ 87,417 $ 76,937 $ 343,821 $ 323,834


Ormat Technologies Contact:

Smadar Lavi
VP Corporate Finance and Head of Investor Relations
775-356-9029 (ext. 65726)
slavi@ormat.com

Investor Relations Agency Contact:

Rob Fink
Hayden - IR
646-415-8972
rob@haydenir.com

Source:Ormat Technologies, Inc.