• Total Revenue for 2024: $879.7 million, a growth of 6.1% year over year.
• Fourth Quarter Revenue: $230.7 million, down 4.4% year over year.
• Gross Profit for 2024: $272.6 million, a 3.3% increase compared to 2023.
• Fourth Quarter Net Income: $40.8 million or $0.67 per diluted share, compared to $35.7 million or $0.59 per diluted share last year.
• Adjusted Net Income for Fourth Quarter: $43.6 million or $0.72 per diluted share, an increase of 7.7% and 7.5% respectively.
• Full Year Net Income for 2024: $123.7 million or $2.04 per diluted share, compared to $124.4 million or $2.08 per diluted share last year.
• Adjusted EBITDA for 2024: $550.5 million, a 14.3% increase compared to 2023.
• Fourth Quarter Adjusted EBITDA: $145.5 million, an increase of 4.6% compared to the fourth quarter of last year.
• Electricity Segment Revenue for Fourth Quarter: Decreased by 2.1% to $180.1 million.
• Product Segment Revenue for Fourth Quarter: Declined by 21.4% to $39.6 million.
• Energy Segment Revenue for Fourth Quarter: Increased by 56.7%.
• Gross Margin for Electricity Segment: 34.9% in the fourth quarter and 34.6% for the full year.
• Net Debt as of December 31, 2024: $2.2 billion, equivalent to 4 times net debt to EBITDA.
• Cash and Cash Equivalents as of December 31, 2024: Approximately $206 million.
• Total Debt as of December 31, 2024: Approximately $2.4 billion.
• Dividend Declared: $0.12 per share payable on March 26, 2025.
• 2025 Revenue Guidance: Expected to be between $935 million and $975 million.
• 2025 Adjusted EBITDA Guidance: Expected to range between $563 million and $593 million.

• Warning! GuruFocus has detected 8 Warning Signs with ORA.

Release Date: February 27, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Ormat Technologies Inc (NYSE:ORA) reported a 6.1% increase in total revenues for 2024, driven by growth across all three business segments.
• The company achieved a 14.3% increase in adjusted EBITDA, showcasing strong financial performance.
• Successful acquisition of strategic assets significantly boosted revenues and EBITDA in the electricity segment.
• Ormat secured three new PPAs with higher rates, reflecting strong demand for geothermal energy.
• The energy storage segment saw a 56.7% revenue increase in Q4 and 30.6% for the full year, driven by new facilities coming online.

Negative Points

• Fourth-quarter revenue decreased by 4.4% year over year, primarily due to curtailment impacts in the electricity segment.
• Gross profit in the fourth quarter declined by 6.2%, affected by unexpected operational challenges.
• The company anticipates continued curtailment issues in 2025, potentially impacting revenues by $10 million to $15 million.
• Product segment revenues declined by 21.4% in the fourth quarter, indicating volatility in this segment.
• The energy storage segment reported lower margins in Q4, influenced by market conditions and supply chain challenges.

Q & A Highlights

Q: How should we think about the electricity generation expectations for the electricity segment in the 2025 guidance? A: Doron Blachar, CEO, explained that most new projects are expected to come online towards the end of the year, with some curtailment impacts anticipated. Therefore, a modest increase or flattish growth in generation is expected for 2025, setting up potential double-digit growth in 2026 as new projects come online.

Q: Can you comment on the increase in exploration and preliminary drilling activities in the CapEx guide? A: Doron Blachar, CEO, stated that the company is focusing on increasing exploration activities, with plans to drill more wells. This is driven by rising PPA prices and faster permitting processes, which reduce risks and support portfolio growth over the next few years.

Q: Regarding the 250 megawatts of potential PPA contracting with data center hyperscales, why is the timing post-2028? A: Doron Blachar, CEO, explained that the timing aligns with the expiration of existing PPAs and the expected completion of greenfield projects by the end of 2028 or early 2029. The company is negotiating both direct contracts and those involving utilities.

Q: How many megawatts are included in the safe-harbored geothermal projects through 2028, and can this be extended beyond 2028? A: Doron Blachar, CEO, noted that the company has safe-harbored projects to add close to 400 megawatts of solar and geothermal capacity by 2028. They are also exploring options to extend safe harboring into 2029 for geothermal and beyond 2026 for storage.

Q: Can you provide an update on the MOU with SLB for developing geothermal assets? A: Doron Blachar, CEO, highlighted that the MOU with SLB focuses on leveraging SLB's drilling expertise and customer base to develop geothermal projects. They are also collaborating on EGS technology to address current challenges and aim for mid to long-term impacts.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.