Broadwind, Inc. · NASDAQ:BWEN
Broadwind — Broadwind Energy — Aegis Growth Conference (October 2015)
19 slides from Broadwind's conference presentation, Oct 9, 2015
Slide 1: Aegis Growth Conference Investor Presentation
© 2015 Broadwind Energy, Inc. All rights reserved. 1 Aegis Growth Conference Investor Presentation October 9, 2015
Slide 2: Industry Data and Forward-Looking Statements Disclaimer
Industry Data and Forward-Looking Statements Disclaimer 2 © 2015 Broadwind Energy, Inc. All rights reserved. Broadwind obtained the industry and market data used throughout this presentation from our own research, internal surveys and studies conducted by third parties, independent industry associat
Slide 3: Broadwind Overview
Broadwind Overview 3 Towers and Weldments Leading U.S. wind tower manufacturer Flexible manufacturing/design practices – have built towers for 6 different turbine OEM’s Leveraging welding competencies in broader energy markets Gearing 90-year history Precision gearing manufacturer (>1 meter diameter
Slide 4: Executing On Our Plan
Executing On Our Plan 4 Improved >10 pp since 2010 CAGR 10% $M © 2015 Broadwind Energy, Inc. All rights reserved. Improved $18M since 2010 0% 5% 10% 15% 20% 25% 2010 2011 2012 2013 2014 SG&A as % of Revenue 0 50 100 150 200 250 2010 2011 2012 2013 2014 Sales 0% 2% 4% 6% 8% 10% 2010 2011 2012 2013 20
Slide 5: Broadwind Order Backlog
Broadwind Order Backlog © 2015 Broadwind Energy, Inc. All rights reserved. 5 Tower backlog typically 6-9 months; 2015 tower production capacity sold out; currently in discussions for 2016-2017 Gearing backlog typically 4-6 months Strong Order Backlog - Good Visibility Order surge prior to PTC extens
Slide 6: Supportive Wind Policy Environment
Supportive Wind Policy Environment © 2015 Broadwind Energy, Inc. All rights reserved. Production Tax Credit EPA Clean Power Plan Has supported wind energy since 1992 Senate Finance Committee supports as part of 2015 Tax Extenders Package Likely timing: before YE 2015 Will support installations into
Slide 7: Wind Energy is Cost Competitive
Wind Energy is Cost Competitive © 2015 Broadwind Energy, Inc. All rights reserved. 7 58% cost reduction in 5 years –and efficiencies still improving New financing vehicles like Yieldcos provide low-cost development capital Commercial customers like Walmart, Dow Chemical, and Microsoft buying wind to
Slide 8: U.S. Wind Power – 49,000 spinning turbines, 10% growth
U.S. Wind Power – 49,000 spinning turbines, 10% growth © 2015 Broadwind Energy, Inc. All rights reserved. 8 8 GW of new turbines = ~ 4000 new towers $1.4 Billion annual tower market at $350,000/tower BWEN full capacity of 500 towers represents 12% market share Source: MAKE Consulting Source: AWEA Q2
Slide 9: We have encountered difficulties increasing tower production to meet demand
We have encountered difficulties increasing tower production to meet demand © 2015 Broadwind Energy, Inc. All rights reserved. 9 2014-15 Production Issues: Tactical issues resolved in short-term – supply chain, steel, paint Process/contract changes to improve operating consistency at near-full capac
Slide 10: Inventory spike is behind us
Inventory spike is behind us © 2015 Broadwind Energy, Inc. All rights reserved. 10 Steel plate supplies are customer and design specific and comprise majority of inventory Inventories rose to record high at 3/31/15 due to West Coast port strike and production difficulties –added $16 million of worki
Slide 11: We have liquidity to support our needs
We have liquidity to support our needs © 2015 Broadwind Energy, Inc. All rights reserved. 11 June 30 debt balance included $5 million term loan and $2.6 million low-interest, investment-incentive loan which will be forgiven in 2018 Sept 30 cash balance exceeded $4 million and should exceed $10 milli
Slide 12: We are exiting the unprofitable Services segment
We are exiting the unprofitable Services segment © 2015 Broadwind Energy, Inc. All rights reserved. 12 BOD approved plan to divest segment – competitive environment intensifying and BWEN scale not economic $8M net asset base Currently in active discussions with potential buyers Expect transaction pr
Slide 13: Q3 Financial Outlook
Q3 Financial Outlook © 2015 Broadwind Energy, Inc. All rights reserved. 13 * Q3 Preliminary Estimates as of 9.18.15 Q3 Outlook Reduced in September: Production difficulties in Tower business Gearing managing through oil & gas and mining downturn; savings from consolidation in effect; aggressive cost
Slide 14: Investment Thesis
Investment Thesis Wind energy becoming mainstream in U.S. Stock price under pressure due to recent manufacturing stumbles Healthy backlog with high-quality customer base Tax loss carry-forward of $174M Asset rich with limited debt; tangible asset value of $5.40/share © 2015 Broadwind Energy, Inc. Al
Slide 15: Appendix
Appendix 15 Appendix © 2015 Broadwind Energy, Inc. All rights reserved.
Slide 16: Towers and Weldments
Towers and Weldments Q2 2014 Q2 2015 YTD 2014 YTD 2015 Orders ($M) $0.9 $51.4 $4.8 $63.2 Towers Sold (#) 119 142 227 245 Revenue ($M) 52.9 55.0 101.2 96.1 Operating Inc ($M) 8.6 7.2 14.2 8.3 -% of Sales 16.2 13.0 14.0 8.6 Adj. EBITDA ($M) 9.6 8.1 16.2 10.3 - % of Sales 18.1 14.8 16.0 10.7 Q2 Results
Slide 17: Gearing
Gearing Q2 2014 Q2 2015 YTD 2014 YTD 2015 Orders ($M) $18.5 $3.9 $27.0 $13.8 Revenue ($M) 12.4 8.0 21.2 16.6 Operating Loss ($M) -1.8 -1.5 -4.8 -2.7 Adj. EBITDA ($M) .6 -.2 -.2 -.1 Q2 Results Oil & gas and mining orders down sharply Revenue down 36% in Q2; 22% YTD Operating Loss narrowed – cost mana
Slide 18: Services
Services Q2 2014 Q2 2015 YTD 2014 YTD 2015 Orders ($M) $4.4 $4.7 $8.0 $6.6 Revenue ($M) 3.5 2.7 5.9 4.6 Operating Loss ($M) -1.3 -1.8 -2.7 -4.4 Adj. EBITDA ($M) -1.0 -1.4 -1.9 -3.6 Q2 Results Seasonal order intake growth occurring Weaker Blade and Shop revenue vs 2014 South Dakota gear shop closed -
Slide 19: Click to edit Master title style Click to edit Master text styles Second level
Click to edit Master title style Click to edit Master text styles Second level Third level Fourth level Fifth level Broadwind Energy is committed to helping customers maximize performance of their energy and infrastructure investments— quicker, easier and smarter. 19 © 2015 Broadwind Energy, Inc. Al
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