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Ormat dips after co trims revenue guidance

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Geothermal energy company Ormat Technologies (TASE: ORA; NYSE: ORA) recorded 10.4% growth in first quarter revenue to $184 million, which is higher than the consensus analysts’ estimate. The company beat the analysts’ estimate on net profit as well, posting earnings per share of $0.35, which compares with an estimate of $0.33. Ormat lowered its annual revenue guidance, however, although it left its EBITDA guidance unchanged.

Ormat’s share price is down 4.20% on the Tel Aviv Stock Exchange this morning, at NIS 246.20.

Ormat, headed by Doron Blachar, builds geothermal power plants, to be operated by the company itself (electricity segment) or by others (product segment). It is also active in energy storage.

In the electricity segment, revenue increased by 12.1% for the first quarter of 2022, in comparison with the corresponding quarter of 2021, to $163 million. Product segment revenue increased 69.2% to $14.6 million, and the company had a product segment backlog of $45.7 at the end of the quarter. Energy storage segment revenue decreased 48.5% to $6.6 million, which the company explained was primarily due to the absence of a one-time revenue of $5.4 million in the first quarter of 2021 related to the February power crisis in Texas.

On a GAAP basis, operating profit declined 9.6% to $45.1 million, among other things because of higher operating costs and recognition of a small decline in value of energy storage assets. Nevertheless, net profit attributable to shareholders rose 20.8% to $18.4 million. Adjusted EBITDA for the first quarter was $108 million, up from $99.2 million in the corresponding quarter. The rise is attributed to the strength of the electricity segment in the quarter.

As mentioned, Ormat has reduced its annual revenue guidance. It now forecasts revenue of $710-735 million in 2022, whereas the previous guidance was $725-750 million. The reduction relates entirely to the electricity segment. Adjusted EBITDA is forecast to be $430-450 million.

“We are encouraged by the company’s ability to continue driving solid operating performance, as we delivered strong quarterly net income and Adjusted EBITDA, along with meaningful year-over-year growth in revenues,” Blachar said. “Overall growth in the first quarter was driven by the McGinness Hills enhancement, the increased capacity at Puna and the addition of the Dixie Valley and Beowawe power plants to our asset portfolio.




“We recently commenced commercial operation of Tungsten Mountain 2, which successfully increased the total the Tungsten complex by 13 MW, and we are on track to complete construction of the CD4 geothermal power plant, the Tungsten Solar, the Steamboat Hills Solar and the Wister Solar facilities by the end of the second quarter of this year.

“We remain confident in our long-term plans to increase our combined geothermal, energy storage and solar generating portfolio to more than 1.5 GW by 2023. Further, we are on track to deliver an annual adjusted EBITDA of $500 million on a run-rate basis towards the end of 2022 and expect these figures to continue their healthy growth trajectory as we move forward with our plans in 2022 and beyond.”

Published by Globes, Israel business news – en.globes.co.il – on May 3, 2022.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.


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G7 finance leaders reaffirm FX commitment in communique By Reuters

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© Reuters. FILE PHOTO: Attendees pose for a family photo during the G7 Summit in Koenigswinter, near Bonn, Germany May 19, 2022. REUTERS/Benjamin Westhoff

By Leika Kihara and Francesco Canepa

KOENIGSWINTER, Germany (Reuters) – Group of Seven (G7) finance leaders on Friday pledged to closely monitor markets given recent volatility and reaffirmed their commitment on exchange rates, nodding to Japan’s concern over recent sharp declines in the yen.

The G7 advanced economies have an agreement that markets ought to determine currency rates, that the group will closely coordinate on currency moves, and that excessive and disorderly exchange-rate moves would hurt growth.

Japanese policymakers have said the agreement gives Tokyo leeway to jawbone, or even intervene directly in the currency market to counter sharp moves in the yen.

“We will also continue to closely monitor markets given recent volatility. We reaffirm our exchange rate commitments as elaborated in May 2017,” the G7 finance leaders said in a communique issued after a two-day meeting that ended on Friday.

Once welcomed as giving exports a boost, a weak yen has emerged as a source of concern for Japanese policymakers, as it inflates already rising costs of imported fuels and raw materials.

Japanese Finance Minister Shunichi Suzuki told reporters on Thursday Tokyo wanted the G7 to reaffirm its commitment on exchange-rate policy, as the country struggles with the yen’s slide to two-decade lows.

The dollar’s broad ascent has also pushed down the euro, adding inflationary pressure to the region that is feeling the strain from the Ukraine crisis-driven surge in energy costs.

While the yen has bounced back somewhat against the dollar this week as part of the U.S. currency’s broad retreat, many analysts expect prospects of steady interest rate hikes by the Federal Reserve to sustain the dollar’s uptrend.

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Here are Friday’s biggest analyst calls of the day: Amazon, Apple, Salesforce, Costco, Block & more

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There’s a fairly inexpensive way companies can save millions in employee turnover costs

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Saying ‘thank you’ can go a long way to cutting company turnover costs. Read More

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