Note 1 - General and Basis of Presentation

6 Months Ended

Jun. 30, 2013

Disclosure Text Block [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

NOTE 1 — GENERAL AND BASIS OF PRESENTATION

These unaudited condensed consolidated interim financial statements of Ormat Technologies, Inc. and its subsidiaries (collectively, the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Accordingly, they do not contain all information and notes required by U.S. GAAP for annual financial statements. In the opinion of management, these unaudited condensed consolidated interim financial statements reflect all adjustments, which include normal recurring adjustments, necessary for a fair statement of the Company’s consolidated financial position as of June 30, 2013, the consolidated results of operations and comprehensive income for the three and six-month periods ended June 30, 2013 and 2012 and the consolidated cash flows for the six-month periods ended June 30, 2013 and 2012.

The financial data and other information disclosed in the notes to the condensed consolidated financial statements related to these periods are unaudited. The results for the three and six-month period ended June 30, 2013 are not necessarily indicative of the results to be expected for the year ending December 31, 2013.

These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2012. The condensed consolidated balance sheet data as of December 31, 2012 was derived from the audited consolidated financial statements for the year ended December 31, 2012, but does not include all disclosures required by U.S. GAAP.

Dollar amounts, except per share data, in the notes to these financial statements are rounded to the closest $1,000.

Revision of previously issued financial statements

The Company identified an error this quarter related to the calculation and presentation of income tax provision and the related deferred tax asset for the year ended December 31, 2012 and the three months ended March 31, 2013, which was a direct result of the deferred tax effects of the non-cash asset impairment charge recorded in the fourth quarter of 2012. The Company understated the valuation allowance against the U.S. deferred tax assets by $32.7 million and $3.1 million at December 31, 2012 and March 31, 2013, respectively. As a result, for the year ended December 31, 2012 the Company revised the valuation allowance by $32.7 million, of which $26.1 million was recorded against property, plant and equipment where the Company recognized the deferred tax effects of grants received during 2012 and the remaining $6.6 million to the income tax provision. For the three months ended March 31, 2013, the Company revised the valuation allowance by an additional $3.1 million which also increased the tax provision for the period by the same amount.

The Company assessed the materiality of this error in accordance with the SEC’s Staff Accounting Bulletin 99 and concluded that the previously issued financial statements were not materially misstated. However, if the entire correction of the error was recorded during the second quarter of fiscal 2013, the impact would be significant to the quarter ended June 30, 2013.  In accordance with the SEC’s Staff Accounting Bulletin 108, the Company will correct these errors by revising the affected financial statements previously included in the Company’s 2012 Annual Report of Form 10-K and March 31, 2013 Quarterly Report of Form 10-Q.

This revision had no impact on the Company’s revenues, gross margin, operating income (loss), income (loss) before taxes and equity income (loss) of investees. There was also no impact on the Company's consolidated net operating, investing or financing cash flows; however, the revisions impacted line items within the balance sheet at December 31, 2012 and March 31, 2013 and cash flows from operating activities for the year ended December 31, 2012 and the three months ended March 31, 2013. The revision impacted the Company income tax benefit (provision), net income (loss) from continuing operations, net income (loss) attributable to the Company's stockholders, comprehensive income (loss) and earnings (loss) per share (“EPS”) in the consolidated statements of operations and comprehensive income for the year ended December 31, 2012 and the three months ended March 31, 2013. 

The consolidated statement of operations and comprehensive income, consolidated balance sheet, and consolidated statement of cash flows for the year ended December 31, 2012 will be revised in the Company's 2013 Annual Report on Form 10-K and for the three months ended March 31, 2013 will be revised to correct the errors described above prospectively in the quarterly report on Form 10-Q for the first quarter of 2014. 

The effect of the revision on the line items within the Company's consolidated balance sheet as of December 31, 2012 is as follows:

	December 31, 2012
	As reported			Adjustment			As revised
	(In thousands)
Deferred income taxes	$	53,989		$	(32,706	)	$	21,283
Property, plant and equipment, net		1,226,758			26,115			1,252,873
Total assets		2,094,114			(6,591	)		2,087,523
Accumulated deficit		(37,735	)		(6,591	)		(44,326	)
Total equity		702,198			(6,591	)		695,607
Total liabilities and equity		2,094,114			(6,591	)		2,087,523

The effect of the revision on the line items within the Company's consolidated statement of operations and comprehensive income for the year ended December 31, 2012 is as follows:

	Year Ended December 31, 2012
	As reported			Adjustment			As revised
	(In thousands, except per share data)
Income tax benefit (provision)	$	3,500		$	(6,591	)	$	(3,091	)
Loss from continuing operations		(206,016	)		(6,591	)		(212,607	)
Net loss		(206,016	)		(6,591	)		(212,607	)
Net loss attributable to the Company's stockholders	$	(206,430	)	$	(6,591	)	$	(213,021	)
Comprehensive loss		(205,960	)		(6,591	)		(212,551	)
Comprehensive loss attributable to the Company's stockholders	$	(206,374	)	$	(6,591	)	$	(212,965	)
Earnings loss per share attributable to the Company's stockholders basic and diluted:	$	(4.54	)	$	(0.15	)	$	(4.69	)

The effect of the revision on the line items within the Company's consolidated statement of cash flows for the year ended December 31, 2012 is as follows:

	Year Ended December 31, 2012
	As reported			Adjustment			As revised
	(In thousands)
Cash flows from operating activities:
Net loss	$	(206,016	)	$	(6,591	)	$	(212,607	)
Deferred income tax provision (benefit)		(11,327	)		6,591			(4,736	)
Net cash provided by operating activities	$	89,471		$	-		$	89,471

The effect of the revision on the line items within our consolidated balance sheet as of March 31, 2013 is as follows:

	March 31, 2013
	As reported			Adjustment			As revised
Deferred income taxes	$	52,939		$	(35,758	)	$	17,181
Property, plant and equipment		1,207,410			26,115			1,233,525
Total assets		2,143,568			(9,643	)		2,133,925
Accumulated deficit		(39,717	)		(9,643	)		(49,360	)
Total equity		706,519			(9,643	)		696,876
Total liabilities and equity		2,143,568			(9,643	)		2,133,925

The effect of the revision on the line items within the Company's consolidated statements of operations and comprehensive income (loss) for the three months ended March 31, 2013 is as follows:

	Three Months Ended March 31, 2013
	As reported			Adjustment			As revised
	(In thousands, except per share data)
Income tax provision	$	(1,217	)	$	(3,052	)	$	(4,269	)
Loss from continuing operations		(1,897	)		(3,052	)		(4,949	)
Net loss		(1,897	)		(3,052	)		(4,949	)
Net loss attributable to the Company's stockholders	$	(1,982	)	$	(3,052	)	$	(5,034	)
Comprehensive loss:
Net loss		(1,897	)		(3,052	)		(4,949	)
Comprehensive loss		(1,939	)		(3,052	)		(4,991	)
Comprehensive loss attributable to the Company's stockholders	$	(2,024	)	$	(3,052	)	$	(5,076	)
Loss per share attributable to the Company's stockholders basic and diluted -	$	(0.04	)	$	(0.07	)	$	(0.11	)

The effect of the revision on the line items within the Company's condensed consolidated statements of cash flows for the three months ended March 31, 2013 is as follows:

	Three Months Ended March 31, 2013
	(In thousands)
	As reported			Adjustment			As revised
Cash flows from operating activities:
Net loss	$	(1,897	)		(3,052	)		(4,949	)
Deferred income tax provision		668			3,052			3,720
Net cash provided by operating activities		18,216			—			18,216

Other comprehensive income

For the six months ended June 30, 2013 and 2012 the Company classified $84,000 and $93,000, respectively, from other comprehensive income, of which $136,000 and $150,000, respectively, were recorded to reduce interest expense and $52,000 and $57,000, respectively, were recorded against the income tax provision, in the condensed consolidated statements of operations and comprehensive income. For the three months ended June 30, 2013 and 2012, the Company classified $42,000 and $47,000, respectively, from other comprehensive income, of which $68,000 and $76,000, respectively, were recorded to reduce interest expense and $26,000 and $29,000, respectively, were recorded against the income tax provision in the condensed consolidated statements of operations and comprehensive income.

Termination fee

On March 15, 2013, the Company finalized the agreement with Southern California Edison Company (“Southern California Edison”), by which the G1 and G3 Standard Offer #4 power purchase agreements (“PPAs”) were terminated and a termination fee of $9.0 million was recorded in the first quarter of 2013 in selling and marketing expenses. Under the agreement, the Company will continue to sell power from G2, the third plant of the Mammoth complex, under its existing PPA with Southern California Edison, with the term of the contract extended by an additional six years until early 2027.

Concentration of credit risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist principally of temporary cash investments and accounts receivable.

The Company places its temporary cash investments with high credit quality financial institutions located in the United States (“U.S.”) and in foreign countries. At June 30, 2013 and December 31, 2012, the Company had deposits totaling $18,792,000 and $41,231,000, respectively, in seven U.S. financial institutions that were federally insured up to $250,000 per account. At June 30, 2013 and December 31, 2012, the Company’s deposits in foreign countries amounted to approximately $18,551,000 and $33,215,000, respectively.

At June 30, 2013 and December 31, 2012, accounts receivable related to operations in foreign countries amounted to approximately $33,070,000 and $17,606,000, respectively. At June 30, 2013 and December 31, 2012, accounts receivable from the Company’s primary customers (listed below) amounted to approximately 56.7% and 45.0% of the Company’s accounts receivable, respectively.

Sierra Pacific Power Company and Nevada Power Company (subsidiaries of NV Energy, Inc.) accounted for 14.9% and 14.7% of the Company’s total revenues for the three months ended June 30, 2013 and 2012, respectively, and 17.8% and 13.9% for the six months ended June 30, 2013 and 2012, respectively.

Southern California Edison accounted for 12.4% and 17.0% of the Company’s total revenues for the three months ended June 30, 2013 and 2012, respectively, and 12.1% and 18.6% for the six months ended June 30, 2013 and 2012, respectively.

Hawaii Electric Light Company accounted for 8.6% and 10.3% of the Company’s total revenues for the three months ended June 30, 2013 and 2012, respectively, and 8.9% and 9.9% for the six months ended June 30, 2013 and 2012, respectively.

Kenya Power and Lighting Co. Ltd. accounted for 10.3% and 7.8% of the Company’s total revenues for the three months ended June 30, 2013 and 2012, respectively, and 9.5% and 7.6% for the six months ended June 30, 2013 and 2012, respectively.

The Company performs ongoing credit evaluations of its customers’ financial condition. The Company has historically been able to collect on all of its receivable balances, and accordingly, no provision for doubtful accounts has been made.