Good morning ladies and gentlemen and thank you for waiting. Welcome to the Ormat Fourth Quarter Year End 2014 Conference Call. All lines have been placed on listen-only mode. And the floor will be open for your questions and comments following the presentation. I would now like to turn the conference over to Mr. Jeff Stanlis of MS/Hayden - IR. Mr. Stanlis, you may begin your conference.

Thank you, Zelda. Hosting the call today are Isaac Angel, Chief Executive Officer; and Doron Blachar, Chief Financial Officer; and Smadar Lavi, Vice President of Corporate Finance and Investor Relations. Before beginning, I would like to remind you that the information provided during this call may contain forward-looking statements relating to current expectations, estimates, forecasts and projections about future events that are forward-looking, as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally relate to the Company’s plans, objectives and expectations for future operations and are based on management’s current estimates and projections for future results and trends. Actual results may differ materially from those projected as a result of certain risks and uncertainties. For a discussion of such risks and uncertainties, please see the risk factors as described in Ormat Technologies’ annual report on Form 10-K filed with the Securities and Exchange Commission on February 28, 2014. In addition, during the call, we will present non-GAAP financial measures, such as EBITDA and adjusted EBITDA. Reconciliations to the most directly comparable GAAP measures and management reasons for presenting such information is set forth in the press release that was issued last night, as well as in the slides posted on the Company’s website. Because these measures are not calculated in accordance with U.S. GAAP, they should not be considered in isolation from the Company’s financial statements prepared in accordance with GAAP. Before I turn the call over to management, I would like to remind everyone that a slide presentation accompanying this call may be accessed on the Company’s website at ormat.com, under the IR Events & Presentations link that if found on the Investor Relations tab. With that said, I would like to turn the call over to Isaac Angel. Isaac, the call is yours.

Thank you Jeff and good morning everyone. Thank you for joining us today for the presentation of our fourth quarter and full year 2014 results and outlook for the near future. On the slides four and five, we identify the highlights for what has been a busy, productive and a successful year. We continue to deliver strong financial performance year-over-year with record revenues. 48% increase in operating income; 31% increase in net income, robust adjusted EBITDA of $272.7 million. Doron will give into the numbers -- will go into the numbers in detail in a minute. During 2014, we took meaningful steps to increase shareholders’ value as well as giving the Company the resources to expand and improve its operations. I’m excited with the progress we made last year. And today, we have a wider range of continuities -- to continue this progress in 2015 and beyond. I will elaborate on the progress we made on our plans for the future and Doron will review the financial results. Doron?

Thank you, Isaac, and good morning everyone. Let me start by providing an overview of our financial results for the year end December 31, 2014. Starting with slide seven, total revenue for the 2014 were $559.5 million, a 4.9% increase over revenues of $533 million in 2013. In our Electricity segment, as you can see on slide eight, revenue grew 15.9% to $382.3 million in 2014 from $329.7 million in 2013. The increase was primarily due to the new capacity coming on line at the Olkaria complex in Kenya as well as the commencement of Don Campbell power plant in Nevada. In 2014, we managed our economic exposure to natural gas and oil prices in our Electricity segment through hedging activities. As a result of such activities, we recorded in the Electricity revenue a net gain on derivative contracts on oil and natural gas prices of $5.7 million in the 2014 compared to a net loss of $5 million in 2013. In the product segment, on slide nine, product revenues were $177.2 million in line with our guidance expectations, compared to $203.5 million in 2013. The decrease is due timing of revenue recognition and different product mix. Moving to slide 10, the Company combined gross margin for 2014 increased to $203.7 million or 36.4% compared to $160.8 million or 30% in 2013. In the Electricity segment, gross margin for 2014 increased to $135.7 million or 35.5% compared to $96.9 million or 29.4% in 2013. This increase was mainly due to the higher margin that new power plants contributed as well as the impact of mark-to-market related to the derivative contracts. In the Product segment, gross margin for 2014 was $68.1 million or 38.4% compared to $62.9 million or 30.9% in 2013. The increase in the Product gross margin percentage is…

Thank you very much, Doron. Starting with slide 21, during 2014 we focused on the commencement of Plant 3 of Olkaria complex and construction of the McGinness Hills, Phase 2 power plant. In addition, we began construction in Don Campbell, Phase 2 project. In early February 2014, we announced that we successfully completed construction and reached commercial operation of Plant 3 in the Olkaria complex in Kenya. With Plant 3 on line, the complex’s total generation capacity has increased to 110 megawatts. In December, we amended the existing PPA with KPLC, paving the way for the expansion of the complex with an additional 24 megawatts. Early this year, we announced that the second phase of McGinness Hills power plant in Nevada has begun commercial operations. Since February 1, 2015, the complex sells electricity under the amended PPA with envy energy at a new energy rate of $85.6 per megawatt with 1% annual escalation through December 2032. The second phase broke ground on March 2014 following resource confirmation and excellent performance of the first phase, which had been operational since June 2012. Implementing our phase development approach, enabled us to bring on line the second phase rapidly as well as to take advantage from economies of scale. We expect the complex will further improve our financial performance. The total generation for 2014 was approximately 4.4 million megawatt hours, which is an increase of 4.6% from the last year. The growth in generation is mainly due to contribution of Don Campbell power plant in Nevada; Olkaria Plant 3 in Kenya and Amatitlan in Guatemala. In Puna, following the hurricane Iselle, that hit the Hawaiian Big Island in August 2014, we were required to temporarily shut down our power plant. As a result, one of the production wells did not fully recover and…

Thank you. We will now begin the question-and-answer session. [Operator Instructions]. First question comes from Dan Mannes with Avondale. Please go ahead.

Thank you. Good morning everyone.

Good morning, Dan.

First of all, thank you very much for the adjusted EBITDA guidance, I think it’s something we’ve all been looking for a while and I think it’s a nice step. But unfortunately, that also means we have a whole bunch of questions about it. So, I wanted to first start off, can you talk at all about your hedge position for 2015 as it relates to natural gas and oil and maybe help build up the revenue guidance on power in relation to any hedges you may have?

Yes Dan, it’s Doron. Regarding the hedge activities, today we have hedge for first quarter -- natural gas hedge for the first quarter of 2015 at the price of 495. [ph] This is the only hedge that we have to-date for oil and natural gas. And obviously as you allude to the reduction in the price has had an impact on our revenue guidance which assumes the December pricing of oil and natural gas.

So, as we look at year-over-year, so for instance or 2014, your power revenue was $380 million; for 2015, you’re giving us a range of $380 million to $ 390 million. You have some pretty substantial headwinds on the natural gas side and on the crude side at Puna. So, maybe, could you just help us other than the inclusion of McGinness, anything else we should be thinking about that maybe helpful on the power side this year?

Basically the reduction in the oil prices and natural gas prices are the reason that you don’t see a higher increase due to the McGinness contract, plant going into operation. If you take the 2015 generation number and try to calculate it based on the pricing of 2014 to get apples-to-apples comparison, the impact is roughly $20 million on the revenue.

Got it. Thank you. And then, similarly, as you look at the EBITDA number, your adjusted EBITDA was 272 for 2014. You did back out the benefit of the hedges in 2014. So, this is apples-to-apples assuming no benefit from the hedges in 2015. Can you maybe talk to us about where the upside is coming from year-over-year when revenue is kind of flattish on the power side? And then on product, you’re telling us that well revenue side, your margins will probably be lower. So, can you point to us what’s driving the year-over-year EBITDA growth?

First of all, in the adjusted EBITDA, we are not neutralizing the hedging. What we did there we’re only neutralizing the mark-to-market effect actually having an apples-to-apples calculation. Accounting-wise, we need to mark-to-market but economic-wise, obviously, the hedge impacts the relevant period. So by excluding the mark-to-market, we actually give the right impact for the hedging activity that we do.

So, you’re including the cash benefit of the hedges in the quarter that it impacts but not the mark-to-market impact.

Yes.

Okay, got it. Thank you.

And additional upside that we see within the EBITDA that helps actually cover first of all the McGinness Hills plant that Phase 2 coming on line has a relatively nice EBITDA compared to other power plant that we have which is second phase. It’s based on the existing operations that we have. So, that compensates for quite a lot of the impact or more than the total impact of the hedge. And in addition, we see additional upside in the power plants that we’re operating today, some cost reduction activities that we took. And that obviously impacts more the EBITDA line than the revenue line.

So, it’s fair to assume that we should see better gross margins at the power business year-over-year?

Yes.

That’s the key driver. Anything below the gross profit line that maybe benefiting? Do we expect to see a reduction in either G&A or S&M?

S&M is basically subject to the product sales and product revenue. It’s recognized the sales commission used [ph] over time; that’s the biggest element and sales people. And so, this should be in line with our product revenue. And on the G&A, the saving and cost reduction initiatives are also impacting the G&A of course. But we don’t have a specific number to give out.

Okay. And then, as we think about the Northleaf transaction, which -- first of all, could you give us an update on when you expect that to close? And then two, how we think about the impact of the Northleaf transaction on your adjusted EBITDA calculation?

Regarding closing, we don’t have any update. We said we expect it to close in Q1; this is still our expectation. We don’t have any insight to accelerate it or delay it, today. We are working obviously on all the closing conditions that we have and the regular ones and we still expect it in Q1. Since the transaction hasn’t closed yet, so what you see here is 100% EBITDA of all of our power plants. In the future, since we are consolidating, the calculation of the EBITDA will come to 100%. But obviously part of that will go to Northleaf.

Got it. So, on the other side, we should probably think about your enterprise values and as we’ll probably need to gross that up for Northleaf’s investment.

If you would go through the enterprise value, then we would have allocated to us maybe lower EBITDA but on the other hand, there is going to be additional cash on the balance sheet. So, the net debt is going to be much lower.

Got it. And then real quick on Don Campbell, that seems to have come together very, very quickly. Can you talk at all about, number one, the PPA; is it similar to the current one, which I believe is with SCPPA or LADWP? And then two, will this qualify for the production tax credit, i.e. did it get the 5% in service by the end of 2014 -- or the 5% construction?

Regarding the PPA, once it’s going to be finalized and approved, we’ll be able to share with the market all the information. This is power plant that is construction. We are in the final stages of approving the PPA. So, we cannot yet share this with the market. But obviously, the PPA takes into account the Phase 2 project. And the Phase 2 projects, the risk and the cost are lower than Phase 1 project. Don Campbell, based on our understanding does qualify for the PPC. We do have the 5% investment in 2013, 2014 and in addition, we can also do the continuous construction close. So, we expect it to be entitled to PPC.

Great.

This is Isaac, Dan. And you’re right, we are accelerating. Don Campbell is going very fast and the same goes for other power plants we are building. Obviously, it affects our bottom-line.

I think one of the things we are seeing is the phased approach. Obviously the first greenfield does take a while but these expansions, I mean you look at McGinness, you look at Olkaria, or you look at Don Campbell, they are coming on a lot quicker. And financially they do seem to be impacting the bottom-line more meaningfully than maybe power plants that you’d added in the past?

You’re right. And that’s the plan going forward.

And then the last follow-up I have is on Hawaii. You mentioned the long-term plan there. I think there was some news in Hawaii that they finally selected someone to provide 25 megawatts on the Big Island and it’s you. Can you maybe give us any color on what your plans are in Hawaii and whether it’s going to be an expansion of Puna or something else?

It’s not going to be an expansion of Puna, no doubt on that. But it’s too early to say what is going to be done there. The first part of your question is right, we were selected. But it happened only two days ago. So, we really have to sit down and plan ahead and then we will come up with more information in what’s happening. I hope that on our March 31st meeting that I hope to see you there, we will have more color on that.

I apologize. I do have one last one. Any update on CD4 and how that’s going? And maybe -- because that’s not on your list of projects but it’s a pretty advanced development.

We are working behind the scene over there but nothing that we can report as of today. Again, in the upcoming calls, I hope to give you more color on that.

Sounds good. Thanks a lot guys. And thanks for the EBITDA guidance.

Thank you very much, Dan.

The next question comes from JinMing Liu with Ardour Capital. Please go ahead.

Good morning. Thanks for taking my question.

Thank you, Jin.

First off, regarding your Product segment. How much revenue you recognized from the Sarulla project in 2014 and how much you put into your guidance for 2015 from that project?

We don’t do the speeches about specific projects because the status of project over the life of a project changes due to either priorities in the manufacturing that we may achieve from one project to another, to an internal project. Regarding 2014, since we did give the guidance of $35 million that we are recognizing in Sarulla, we recognized a little bit more than that, about $38 million. And going forward, you can see this as an ongoing project. It’s a very large project. It has another three years until we finish all the manufacturing and deliveries. So, all-in-all, roughly a linear spread, maybe a little bit higher, the beginning of period is the right spread.

Okay, understand. Regarding your Phase 2 of the Don Campbell project, you mentioned you sale that 40% of interest to Northleaf. Will that transaction be based on the similar multiples as you did, is that the case?

The Phase 2 transaction has different characteristic than the current transaction. Obviously it’s a project that is still in construction. We don’t have any history of operation to show. So, it’s not -- so there is an agreed that is based on the timing of the project and the cost of the project. And once Campbell Phase 2 goes on line, we will be able to share with you.

Okay, got that. Lastly, regarding your Puna facility, how much will the cost be to fix up the facility?

Jin, we are not giving guide on these numbers. So, frankly I cannot tell you the number. Sorry about it.

Okay, got that. Thanks a lot.

Thank you very much.

[Operator Instructions]. The next question comes from Mark Barnett with Morningstar. Please go ahead.

Hey, good morning everyone.

Good morning.

I also thank you for the EBITDA guidance. I appreciate that and you went through a lot of detail on that already. A couple of bigger picture questions maybe. You mentioned specifically obviously the new RPS target and Bill 197 in California. And the RPS is fairly straight forward. But can you discuss a little bit how you think 197 might actually play out in terms of benefit for more baseload resources like geothermal?

I think if you look at California, on the bill and other, there is basic understanding into the regulator of the advantages and benefits of geothermal. And the more they understand the fact that the geothermal is the baseload, it is reliable; then we’ll see this embedded into the bill in California. And we expect this to support our future growth and the need for geothermal energy in the future.

Okay. I know it’s still early days on that, so it’s hard to really detail it. Are there any further tweaks to programs or existing policies or new proposals outside of these two items in California that will impact your either existing or future plants that are on your radar?

None which are determined as we speak now. But we are working very diligently at the capital and in Nevada and in California for local teams. And I hope there are few things that we will be able to talk to you about on our March meeting.

Okay, I appreciate that. Last question from me. You have a fairly full play for development and then near term at the moment. I am just curious other operators maybe are a little bit less capitalized or less experienced. Does anything out there present an M&A opportunity that could be attractive or are you looking fully internally at this point?

Mark, I will relate to it very lengthily in our next meeting, but just a bit of information. We are planning some step-up functions to M&As. So, we’re not only looking on internal growth and we have the financial abilities to do so. And you probably know there are prospects in the market as we speak. So, we are looking around to find synergic M&As for us. But at this stage, it’s only opportunistic. And as I said before, we are restructuring the Company also to build an M&A team that we work on that. But at this stage, it’s only on opportunistic stages. But we are not out ruling it at all.

Okay, great. Thanks for the color. I appreciate it.

Thank you very much, Mark. Have a nice day.

The next question comes from Ella Fried with Leumi. Please go ahead.

Good morning and good afternoon to those in Israel. In order to understand the allocation of EBITDA to Ormat and to Northleaf, could maybe examine the allocation in terms of EBITDA of 2014 as if it were already year with a JV?

Hi, Ella. Thanks for the questions drawn. The allocation, basically what -- Northleaf are going to invest up to 40% or approximately 40% in Puna, Campbell in the oil. So, they’re going to be allocated 40% of the EBITDA of these specific power plants. When we announced the transaction, we said it was roughly at 100% with about $40 million. So, their part should be 16%. But obviously, there is no commitment, so if the part and they do better, then they will get higher EBITDA and if they do low, they will get lower EBITDA.

So, in terms of 2014, if it was -- if the JV already existed, we would be looking at EBITDA of around 250, am I right.

It would be -- looking at 272 minus 16 EBITDA, but obviously when you go to this calculation, you need to look at the enterprise value because…

Yes, the adjustment was the oil price but in general that would be the numbers more or less.

Yes.

Okay. Thank you. And another question about the write-off the geothermal assets that are not going to be developed, how many allocations are we talking?

The majority of the number relates to two allocations. It was Wister in California that was written off in Q2 and Mount Spurr in Alaska that was written off in Q4 this year.

Okay. Thank you. And congratulations on the results.

Thank you very much.

This concludes our question-and-answer session. I’d now like to turn the conference back over to Mr. Isaac Angel for any closing remarks.

Guys, thank you very much for your ongoing support. And thank you very much for being with us this morning. And I’d like to remind you that we are holding an investment conference on March 31st in New York. And we will be more than glad to see you all there. And have a nice day. Thank you very much.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.