On August 6, 2024, Ormat Technologies Inc (ORA, Financial) released its 8-K filing detailing the financial results for the second quarter ended June 30, 2024. Ormat Technologies Inc is engaged in the geothermal energy power business, operating through three segments: Electricity, Product, and Energy Storage.
Performance Overview
Ormat Technologies Inc (ORA, Financial) reported total revenues of $213.0 million for Q2 2024, a 9.3% increase from $194.8 million in Q2 2023. The company's diluted earnings per share (EPS) came in at $0.37, falling short of the analyst estimate of $0.40. Despite the shortfall in EPS, the company demonstrated robust revenue growth across all segments.
Segment Analysis
The Electricity segment, which involves developing, building, owning, and operating geothermal and solar power plants, reported revenues of $166.2 million, a 7.0% increase from $155.3 million in Q2 2023. The Product segment, which includes designing, manufacturing, and selling equipment for geothermal and recovered energy-based electricity generation, saw a 13.1% increase in revenues to $37.8 million. The Energy Storage segment, which focuses on owning and operating grid-connected storage facilities, experienced a significant 48.1% increase in revenues to $8.9 million.
Financial Achievements and Challenges
Ormat Technologies Inc (ORA, Financial) achieved a gross margin of 28.8% in Q2 2024, up from 25.4% in Q2 2023. Operating income rose by 45.0% to $35.1 million, and adjusted EBITDA increased by 25.0% to $126.1 million. However, net income attributable to the company's stockholders decreased by 8.1% to $22.2 million, primarily due to higher interest expenses and other non-operating costs.
“Our strong second quarter results demonstrate Ormat’s track record of translating revenue growth into stronger results across our three-operating segments. This was evidenced by the 9.3% increase in total revenues and a 45% and 25.0% increase in operating income and adjusted EBITDA1, respectively, led by strategic expansion to our capacity generating portfolio and improved operating performance," said Doron Blachar, Chief Executive Officer of Ormat Technologies.
Income Statement Highlights
| Q2 2024 | Q2 2023 | Change (%) | |
|---|---|---|---|
| Total Revenues ($ millions) | 213.0 | 194.8 | 9.3% |
| Operating Income ($ millions) | 35.1 | 24.2 | 45.0% |
| Net Income Attributable to Stockholders ($ millions) | 22.2 | 24.2 | -8.3% |
| Diluted EPS ($) | 0.37 | 0.40 | -7.5% |
Balance Sheet and Cash Flow
As of June 30, 2024, Ormat Technologies Inc (ORA, Financial) reported total assets of $5.51 billion, up from $5.21 billion as of December 31, 2023. The company's cash and cash equivalents stood at $66.3 million, a significant decrease from $195.8 million at the end of 2023. This reduction in cash reserves is attributed to increased investments in property, plant, and equipment, which rose to $3.33 billion from $2.99 billion.
Dividend Declaration
On August 6, 2024, the Board of Directors declared a quarterly dividend of $0.12 per share, payable on September 3, 2024, to stockholders of record as of August 20, 2024. The company also expects to maintain this dividend rate in the next quarter.
Conclusion
Ormat Technologies Inc (ORA, Financial) continues to show strong revenue growth across its operating segments, driven by strategic expansions and improved operational performance. While the company faces challenges such as increased interest expenses, its commitment to expanding its geothermal, solar, and energy storage portfolio positions it well for future growth. Investors will be keen to see how the company navigates these challenges and capitalizes on the growing demand for renewable energy solutions.
Explore the complete 8-K earnings release (here) from Ormat Technologies Inc for further details.
