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Ormat Technologies (ORA) Q4 Earnings Miss, Revenues Up Y/Y

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Ormat Technologies Inc.’s (ORA - Free Report) fourth-quarter 2018 adjusted earnings per share (EPS) came in at 52 cents, which missed the Zacks Consensus Estimate of 54 cents by 3.7%. Earnings also declined 59.2% from the prior-year quarter’s $1.27 per share.

Barring one-time items, the company’s GAAP earnings were 36 cents per share compared with $1.27 in the year-ago quarter.

For 2018, Ormat Technologies’ operating EPS came in at $2.08, down 31.9% from the prior-year quarter’s $3.06. The figure also missed the Zacks Consensus Estimate of $2.09 by a mere 0.48%.

Revenues

In the quarter under review, Ormat Technologies generated revenues of $190.5 million, which exceeded the Zacks Consensus Estimate of $181 million by 5.25%. Also, the top line improved 14.5% on a year-over-year basis.

For 2018, Ormat Technologies’ revenues were $719.3 million, up 3.8% from the prior-year quarter’s $692.8 million. The figure also surpassed the
Zacks Consensus Estimate of $709.9 million by 1.33%.

Segment Revenues

Electricity Segment: Revenues increased 8% year over year to $138.3 million from $128 million. The increase was mainly attributable to the Tungsten Mountain and Olkaria III expansion projects, which came online in the last twelve months, and the USG acquisition.

Product Segment: Segment revenues increased 31.3% year over year to $49.7 million from $37.9 million.

Other Segment: Revenues for this division stood at $2.4 million compared with $0.5 million in the prior-year quarter.

Operational Update

In the reported quarter, Ormat Technologies’ total operating expenses were $22.83 million, up 43% year over year.

The company’s total cost of revenues was $99.66 million, down 2.3% year over year.

Interest expenses were $22.03 million, up approximately 69.7% on a year-over-year basis.

Highlights of the Quarter

On Dec 20, 2018, the company made an announcement regarding the commencement of commercial operation of the third phase of its McGinness Hills geothermal complex located in Nevada. The 48-megawatt power plant started selling electricity to the Southern California Public Power Authority (“SCPPA”) under the Ormat Northern Nevada Geothermal Portfolio Power Purchase Agreement. The third phase is expected to generate approximately $30 million of average annual revenues.

Financial Condition

Ormat Technologies had cash and cash equivalents of $98.8 million as of Dec 31, 2018, compared with $47.8 million as of Dec 31, 2017.

Total long-term debt was $1,040.9 million as of Dec 31, 2018, compared with $804.3 million as of Dec 31, 2017.

Guidance 2019

Ormat Technologies expects full-year 2019 total revenues of $720-$742 million, with electricity segment revenues of $530-$540 million, excluding any impact from Puna during 2019.

Likewise, the company’s Product segment revenues are expected to be $180-$190 million. It also anticipates annual adjusted EBITDA view of $370-380 million for 2019, with no Puna-related EBITDA.

Zacks Rank

Ormat Technologies currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Oils-Energy Releases

Evergy, Inc. (EVRG - Free Report) reported fourth-quarter 2018 operating earnings of 8 cents per share, lagging the Zacks Consensus Estimate of 24 cents by 66.7%.

Covanta Holding Corporation delivered fourth-quarter 2018 earnings of 4 cents per share, missing the Zacks Consensus Estimate of 7 cents by 42.86%.

Murphy Oil Corporation (MUR - Free Report) delivered fourth-quarter 2018 adjusted earnings of 31 cents per share, beating the Zacks Consensus Estimate of 26 cents by 19.2%.

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