Ormat to supply geothermal power plant to EDC, Philippines

Upper Mahio geothermal plant, Philippines (source: Ormat)
Alexander Richter 11 Mar 2018

In its reporting for 2017, Ormat released that it has sold a geothermal power plant to EDC, the first order in the Philippines with hopes for further sales in the near future.

In its reporting on annual results for 2017, Ormat Technologies reported on its product backlog, as we reported  last week, providing additional details in a recent investor call.

As of February 26, 2018, the company’s product segment (power plant technology) backlog increased to $243 million.

In an investor call, the company’s CEO Isaac Angel reported that: “The company was able to sign new contracts in Turkey, which continues to represent a significant share of our its backlog, signed a $50 million EPC contract in New Zealand, . We view this region as one with many opportunities due to the geothermal resources and the government’s commitment to geothermal energy.

Additionally for the first time in a decade, we received an order from EDC in the Philippines. We are targeting the Philippines as a market with the potential for our product sales, and we believe, this order will create more opportunities in the region.

Our backlog also includes the Soda Lake $36 million EPC contract that was signed in December 2016, and is still pending final notice to proceed. This contract was not included in 2018 revenue guidance. We anticipate that our backlog context mix – contract mix together with a lower revenue volume and a weaker dollar expected in 2018, will bring Product segment margin to be in the range of 27% to 30%. Longer-term, we believe opportunities in other region will help us diversify our product backlog and will positively impact our revenues and margin in 2019 and beyond.

Moreover, as we progress with our strategy to increase our Electricity segment portion in the total revenues, we expect lower impact of decremental changes in the Product segment on our financial results.”

Ormat has three geothermal plants on its books. We will report further when we get more information.

Source: Seeking Alpha