Ormat's week: Big honor, earnings up, deals cooking

All in all, it was a pretty good week for Ormat Technologies.

On Tuesday, the Sparks-based developer of geothermal and recovered-energy systems was honored as Distinguished Company of the Year at the annual Governor's Industry Appreciation Awards dinner.

On Wednesday, publicly held Ormat reported record results for the third quarter, including an 82 percent increase in net income after revenues rose by 9.5 percent from year-earlier figures.

And on Thursday, the company's chief executive officer and president said Ormat is ready to start talks with Sierra Pacific Power about selling the output from three more geothermal plants in northern Nevada.

Dita Bronicki said the three plants each might deliver between 15 and 30 megawatts of power.

Although Bronicki cautioned that the negotiations with Sierra Pacific Power are far from a done deal, the new facilities have the potential of more than doubling Ormat's electric production in Nevada.

The company's electric generating operations, which include the Steamboat plant near U.S.

395 and Mount Rose Highway at the south edge of Reno, produced $51.4 million in revenue in the third quarter.

While Ormat is negotiating new deals to build plants and sell power to utilities in Nevada and elsewhere in the world, Bronicki said the company also sees the potential for strong growth from the sale of generation products.

In recent months, for instance, the company signed a $4.4 million contract to sell a recovered-energy generating plant to a cement company in Mumbai, India.

That, she said, is the third sale this year of an Ormat system that captures industrial heat that once was wasted and uses it to generate electricity.

That's giving the company some financial flexibility.

In the current quarter, for instance, it will take a $10 million hit to its earnings as it refinances debt it took on to finance an generation project.

Even though current earnings will suffer, Bronicki said the longterm effects will be positive as the refinancing reduces the company's interest expenses.

The stronger earnings also encouraged its board to pay a dividend of 3 cents a share as Ormat plans a regular payout of at least 20 percent of its net income.