Geothermal electricity developer and operator Ormat Technologies Inc. (NYSE: ORA) reported lower revenue and profit for 2010, compared with 2009, but expects improvement in 2011.
Ormat Technologies' revenue fell to $373.2 million in 2010 from $412 million in 2009. Electricity segment revenue rose 15.5% to $291.8 million from $252.6 million thanks to a 14% increase in output and a $1 rise in average revenue from electricity to $78 per megawatt/hour. This increase was more than offset by the halving of product segment revenue to $81.4 million from $159.4 million in 2009, which the company said was an exceptionally strong year.
Net profit fell to $37.2 million ($0.82 per share) in 2010 from $68.6 million in 2009. Ormat attributes the decline to lower product revenue and higher electricity costs, especially at its North Brawley geothermal power plant in California.
Ormat chairwoman Yehudit Bronicki expects electricity segment revenues to rise to $315-325 million in 2011, but that product segment revenue will be unchanged at $75-85 million.
Ormat Technologies' fourth quarter revenue declined to $92.8 million from $94.2 million for the corresponding quarter of 2009, due to a slump in product segment revenue to $19.3 million from $31.4 million, which a 17% increase in electricity sales to $73.6 million up from $62.8 million could not offset.
Fourth quarter net profit fell nearly 70% to $4.5 million ($0.10 per share) for the fourth quarter from $16.1 million for the corresponding quarter.
Ormat Technologies' increased its cash and cash equivalents to $82.8 million at the end of 2010 from $46.3 million a year earlier, after a $250 million debt offering. The company has $402.5 million in commercial credit, of which $149.1 million is unused.
Bronicki attributes the increase in Ormat's electricity sales to "significant resources we have invested in the acquisition, exploration and development of new leases." She added. "We currently have ten projects in various stages of construction and development that we expect will add significantly to our generation and top-line growth through 2013."
Ormat Technologies is the US subsidiary of Ormat Industries Ltd. (TASE: ORMT). Ormat Technologies' share price closed at $27.95 on Wall Street yesterday, giving a market cap of $1.27 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on February 23, 2011
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