Robert Fink - KCSA Strategic Communications Dita Bronicki - CEO Yoram Bronicki - President & COO Joseph Tenne - CFO Smadar Lavi - VP of Corporate Finance & IR

Paul Clegg - Jefferies Lasan Johong - RBC Capital Market Michael Lapides - Goldman Sachs Ben Kallo - Baird Dan Mannes - Avondale Steve Milunovich - Merrill Lynch Dilip Warrier - Thomas Weisel Partners John Segrich - Gabelli Brian Yerger - AERCA Advisors JinMing Liu - Ardour Capital Carter Driscoll - Capstone Investments Justin Cable - Global Hunter Securities Peter Christiansen - Merrill Lynch

Thank you, Watts. Hosting the call today are Dita Bronicki, Chief Executive Officer; Yoram Bronicki, President and Chief Operating Officer; Joseph Tenne, Chief Financial Officer; and Smadar Lavi, Vice President of Corporate Finance and Investor Relations.

In addition, during this call statements that maybe made that include financial measures defined as non-GAAP financial measures by the Securities and Exchange Commission such as EBITDA. These measure maybe difference from non-GAAP financial measures used by other companies.

The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

For the first quarter of 2010, total revenues were $82.7 million compared to $99.3 million in the first quarter of 2009. As you can see on slide five, this quarter the Electricity segment had revenues of $66.1 million, compared to $62.1 million for the first quarter of 2010.

The increase in generation is the results of some additional capacity with North Brawley being the single most significant contributor to the increase and solid performance from most of plans other than Puna.

Moving now to slide eight, interest expense mix for the first quarter of 2010 was $9.7 million, compared to $3.3 million in the same period last year. The $6.4 million increase was principally attributable to $4.2 million decrease in interest capitalize to projects under construction, primarily due to the commencement of operations of North Brawley and an increase in interest expense due to new long term project finance in corporate debt.

Moving to slide nine, loss from continuing operations for the first quarter of 2010 was $2 million, compared to income from continuing operations of $14.4 million in the same quarter last year. Such decrease in income from continuing operations was principally attributable to the decrease in our gross margin and an increase in interest expense.

Turning now to slide 12, as of March 31, 2010 the company had cash and cash equivalents of $43.1, compared to $46.3 million as of December 31, 2009. This decrease is principally due to our use of $76.5 million of cash resources to fund capital expenditures and $5.5 million to repay long term debt to third parties.

Our total outstanding event as of the end of first quarter of 2010 is $663 million and it will be repaid as presented in accompanying slide 213.

Turning now to slide 12, as of March 31, 2010 the company had cash and cash equivalents of $43.1, compared to $46.3 million as of December 31, 2009. This decrease is principally due to our use of $76.5 million of cash resources to fund capital expenditures and $5.5 million to repay long term debt to third parties.

Our total outstanding event as of the end of first quarter of 2010 is $663 million and it will be repaid as presented in accompanying slide 213.

Turning now to slide 12, as of March 31, 2010 the company had cash and cash equivalents of $43.1, compared to $46.3 million as of December 31, 2009. This decrease is principally due to our use of $76.5 million of cash resources to fund capital expenditures and $5.5 million to repay long term debt to third parties.

Our total outstanding event as of the end of first quarter of 2010 is $663 million and it will be repaid as presented in accompanying slide 213.

Now, let me turn the call over to Yoram.

Now, let me turn the call over to Yoram.

Now, let me turn the call over to Yoram.

Now, let me turn the call over to Yoram.

Let us move to slide 17 for an update on our projects under construction. We have completed the construction of a 5.5 megawatt Recovered Energy Generation plant that will show its power to Great River Energy.

Commercial operation is waiting for the interconnection to be completed, which we expect to happen before the end of this quarter. In the Jersey Valley project, we continued with service outline procurement and fabrication of the generating units.

We expect permits to construct to be granted shortly.

In East Brawley, we still permitting issues that we need to resolve in addition to our need to prove it we can clearly handover percent to meet our currency issue before it makes sense to move forward and build East Brawley power plant. On slide 18, you can see the detailed status of the projects under development.

In February, we signed a Letter of Intent to amend the existing PPA and expand our 48 megawatt Olkaria complex by up to 52 megawatts. The expansion is to be developed in two phases the first 36 megawatt to be completed within three and half years with finalizing the amendment and then option to commence the second phase within four and half years.

The amendment to the existing PPA is subject to applicable governmental approval and the consent of the management that provided the financing to the existing power plant. Moving to slide 19, as you know, we made important progress in the Sarulla project with an agreement to increase the tariff under the energy self content to leverage our price of $68 per megawatt hour.

As a power plants equipment supplier, these developments will have implications to the product side of our business after the financial close, which we expect to happen during the first half 2011. Slide 20 shows the status of the various leases for geothermal resources that we have started expression activity in 15 of this.

Slide 21 is a rate case on the product segment our current backlog is approximately $77 million, of which approximately $20 million will be effective upon receipt of the down payment.

Thank you, Yoram. If you turn to slide 23, as to the outlook for 2010, we are reaffirming our guidance with 2010, Electricity segment revenue to be between $275 million and $285 million.

We also expect additional $9 million revenue from our share of electricity revenue generated by a subsidiary, which is accounted for under the equity method.

In slide 24, you can see the CapEx requirement for 2010 for those growth activities. The funding of this program will come from cash from operation, annual corporate lines of credit and expected proceeds for the refinancing and the cash grant for North Brawley.

Longer term, we will need additional capital that we mainly come from loans, under the DOE loan guarantee program, between 110 megawatts to 150 megawatts for projects under construction and development could be eligible for DOE loan guarantee. We expect to submit our first DOE Section 1705 loan guarantee applications in the next few weeks, assuming we are have able to fund with our ongoing terms of discussion with potential to yield.

The balance of the financing will come from the traditional project finance for the international projects both Sarulla Geothermal and we also considering a corporate high yield bundle trend.

Could you just give us a sense of linearity of the improvement in gross margins? Do you expect is North Brawley improves its cost performance during the year?

Seasonality of PPA is that do make changes, first quarter and fourth quarter tend to be weaker. So the impact is greater.

I see. And then, Joseph, actually could we get the depreciation number for the quarter, please?

Can you repeat that was it $20.5 million or $25 million?

$20.5 million.

And then, the acquisition that you're considering, I know you don't want to say too much about it right now, but can you say whether or not it's US or foreign and then what stage of development it's in?

Okay. And then, just a clarification regarding Sarulla, it looks any equipment order you get there will be in multiple phases, as you've said, and I understand from a previous press release could total around $300 million throughout those phases.

I just want to make sure I understand the potential timeline. If you get the ESC signed in, I think three months you're talking about, you'd expect financial close really kind of in the third quarter of 2011.

And then we would probably expect to hear about an equipment order just after that. Is that the right timeframe to think about this?

Okay, but beyond you would expect then probably a little bit more delay than between the financial close and when you would see an equipment order?

I think the equipment order will come of course financial close is related, there is a possibility that a limited notice to proceed maybe issued a little before financial close, but for planning purposes, we would assume it before financial close.

Dita are you starting to see signs of the PPA market opening up in the US?

Okay, that's good. Going forward, in the past you had talked about 100 megawatt per year kind of growth profile and it was kind of maybe 80 megawatts in the nearer term.

Are we still looking at numbers kind of equivalent? Are you willing to give longer-term guidance?

Last question from me. There’s a lot of market turmoil because of Greece, do you see this affecting the project financing market?

You are talking about the financial market?

Yes, the Greece debt situation is doing all kinds of loop-de-loops to the financial markets, do you see this affecting the project financing market where you do a lot your capital raising?

Hi, Dita. I hate to ask a question that I know you've addressed, but I have to admit I'm a bit confused.

Can you walk us through why the cost structure for now at North Brawley is dramatically different than many of your other plants? And when or if you expect that cost structure to normalize compared to the cost structure of your other facilities?

First, on the product outline outside of Sarulla for 2011, can you kind of give us any type of color around what your estimates for the pipeline is in 2011, projects you're tracking both domestically and internationally?

Okay. And then for Jersey Valley you said you were waiting on some construction permits and then we had it being completed by the end of 2010.

When do you think you'll have those construction permits?

We expect it shortly in a matter of weeks.

So within the next time we talk to you probably on those for Q2 earnings?

Yes, we certainly expect that, yes. Should be turning ground into concrete by that.

Okay. And then, for East Brawley, do I understand correctly that until you get the North Brawley under control you're not going to move forward, despite even if you get the permits there?

Good. And then, as far as your guidance goes, the revenue guidance for your Electricity segment, do you assume 20 megawatts of production for North Brawley?

And then what about for Puna? And is there any upside there if you can ramp this faster?

Okay. And then, I might have missed it in the presentation, but could you give us an update on the expansion at Puna, where you stand with the PPA?

I just want to clarify on Puna. I think you answered this pretty well in the last question, but so effectively, assuming the recent drilling's successful, you've got 25 megawatts for about two-thirds of this quarter and then at some point in the third quarter you ramp up to the historical, closer to 30?

Is that about the right way to think about it?

Yes.

Okay. And there's no necessary impact between the current sort of fixes at Puna and the current process on the expansion in the PPA negotiations.

Those are unrelated?

Correct.

Got it. And then on North Brawley, the 20 megawatts -- and again, I hate to sort of beat this up.

So your cost structure's going to stay the same through the year at $9.5 million ballpark. But the 20 megawatts we shouldn't expect a material step-up in that until Q4?

Is that because that's when you're going to have delivery and installation of the permanent fix on the balance of the wells?

And then, on the $9.5 million, can you give any indication how much of that is D&A relative to sort of cash costs? Is it half and half or -- ?

Where does the $9.5 million number come from?

I think that was in your presentation on page -- I think you guys noted a $9.5 million increase related to North Brawley on page 5. And I was just wondering how much of that is cash versus D&A.

Dan approximately 3.5 was depreciation.

Really? Okay.

Wow. Got it.

And then, lastly on the financing front, any -- well, actually first, on the ITC for North Brawley, any change or indication on potential timing for locking that down, given that the plant's not running?

We were in the final process of getting the (Inaudible) approval for their leave application, we expect to submit the application in few weeks.

No the way one shot to submit an application, if you decide to submit it before you incur the real capital costs you are waiving that right to be granted additional capital costs. Our analysis has shown that sort of a money benefit of an early receipt of the grant, outflow the additional grant that we may forego.

Makes sense. And then lastly, any update on the process on the loan guarantees?

I know you've been going through the 1703 process for a while. Can you give any color on maybe how that stands and when you might be able to give us some more color?

Or is that more defined by the timing on the underlying projects?

So it is really the remix.

Are there any liabilities associated with the Blue Mountain project?

Blue Mountain project is back on line in full operations since February 24 or 25 as far as we know.

Okay, so nothing there to worry about. And then, you said something about the $20 million in non-effective products backlog.

Is that in the $77 million backlog that you quoted or not?

Yes, it is.

It is in the $77 million. Okay, that's great.

And could you maybe update us on your thoughts on solar? And if you were to do solar projects along with geothermal, would that help the permitting process?

And I know you gave an update recently at the analyst meeting, but any change in permitting speed that you've noticed?

No, no change.

Sorry, another question on North Brawley here. So obviously it's going to be a drag on margins this year.

All else being equal, assuming it's back on line, or I guess it's on line at the end of the year, would you expect Electricity gross margins to regain sort of their historical levels of 29 to 30%?

Yes.

Okay. Thank you.

And then, on Sarulla, I think you mentioned instead of $300 million it's about the revenue over five years. But you also talked about potentially negotiating for additional balance of supply kind of equipment.

I was wondering if you could quantify what the additional scope could be.

Just two questions, if I could. One, as you look at the second quarter, is there going to be any additional D&A coming on for North Brawley or was that $2.5 million the full amount that's going to impact the P&L on a quarterly basis?

And then secondly, can you talk a little bit about your project margins? I'm just trying to understand how with a roughly 50% sequential decline in revenue you're able to show margins that are increasing.

Is that because you use percentage accounting there? Or what really drives the underlying margin on a quarter-to-quarter basis on volume?

In the Product segment?

Yes.

The product segment has two factors which impacts the gross margins One is volume, if you have bigger volume, everything else being equal, your margin increase, because fixed costs are divided over a bigger activity, but the other is the variation which exist between compounded contracts, some contracts to start with has a high gross margins and some have the lower gross margin. And it has to do with the timing, the quotation or issue.

It has to do with competitive market the time the quotation or the issue. So its not the same, it has to do with commodity price changes as we look into it.

If you look at the costs that have come on for North Brawley, you said there was about $2.5 million of depreciation for the quarter. Is that the total amount of depreciation that we should be thinking about each quarter or does that number go up in the second quarter because you didn't really recognize a full quarter of having the plant online?

The plant was placed in service in mid-January, so the first quarter we had two weeks late than what is going to go forward, probably.

Most of my questions have been answered, but I'll just go back to North Brawley real quick. What I'm hearing is you're looking at maybe maximum production of around 50 megawatts.

Is that -- are you confident that that's going to be done by Q1 of 2011 or are we looking at Q4 of this year?

No, Q1 of 2011 was more realistic.

Can you share with us some of your view on the PPA market? Because I know some other form of renewable energies are currently facing some challenges in signing PPA, mainly just due to a lower price.

What's your view for the PPA market for the next, say, two or three years?

We can only speak from delivery, we have been able to sign the fiscal PPA this year as it is related to do acquisitions. So our feelings on PPA market is positive.

Wanted to just take a step back and rehash kind of the product segment to help us better understand. Is there a minimum size of a plant that you would attempt to bid on?

I mean, there are numerous smaller projects out there. Do you have a threshold at which it doesn't become economic for you to become part of the bidding process or the number of competitors ramps up at, say, a 50 megawatt project?

Could you help us understand that, plus the timing of when you would start to engage in the bidding process and how long your resolution would take until the final reward is done?

You are talking about the product segment.

Yes.

Okay. But five is roughly the cutoff?

Depends on market, Europe has higher energy prices, so much smaller plants could be viable, the US, North America is more difficult in that sense. But as Dita said, our threshold is really based on our assessment of the viability of the prospect more than anything else.

We have the equipment that covers all ranges.

And then, just following up with that a little bit, if say the product segment, you saw a lot more robust activity over the next year or two, is there some type of threshold or a limit to the number of projects that you could address? Or could you scale up your sales effort, engineering effort to address as many projects as you could potentially supply on the equipment side?

And just lastly, when does that, the discussion, really heat up in terms of supplying the above-ground equipment? I mean, does the entire well field need to be developed?

Do you just need to see a successful well being drilled? Help us understand when it really begins to hit your radar screen in terms of being potential revenue for you.

From our perspective?

Yes.

Just a couple questions in terms of for our modeling. One, the gain on sale during the quarter, I can't recall if you explained what that was from?

India?

Of the New Zealand subsidiary.

What it is related to?

Its sale of the problems in New Zeeland the former shareholders has an option to acquire it and they exercise it.

Okay. The interest expense of $9.7 million, should we consider this to be the new base line run rate going forward?

Yes, the amount of capitalized interest would increase during the year end when we invest more in the new project there on the construction, so it might go down during the year.

On the new Puna project, are we going to have oil-indexed contracts again? Or is it going to be a different type of contract?

Yes, it will be a different contract.

Just a follow-up, on the potential acquisition, what stage are you at in that acquisition?

So just initial talks about a potential acquisition or have you actually entered into some type of negotiations?

Is what phase of the Sarulla construction does your stake take place?

The release of the equipment is the…

I'm talking about your project specifically, the 43 megawatts.

43 megawatts is 8.75% of the total projects.

Just another quick housekeeping question. Could you give the split of revenues?

How much was international and also if you have the megawatts generated, or megawatt hours generated from international?

Not even the revenue.

So we thank you all for listening to us and look forward to speaking to you again next quarter.