Slide 1: Q2 2015 Earnings Conference Call
Q2 2015 Earnings Conference Call July 30, 2015
Slide 2: Industry Data and Forward-Looking Statements Disclaimer
Industry Data and Forward-Looking Statements Disclaimer 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 associations or general publications and other publicly avail
Slide 3: Towers Update
Towers Update Abilene Progress Abilene production returning to normal levels Plant throughput improved with more consistent production Continue to improve processes and workflow Continuous Improvement (CI) efforts are still uncovering productivity opportunities 7/30/15 © 2015 Broadwind Energy, Inc.
Slide 4: Orders and Backlog
Orders and Backlog Orders – $M $50M tower order in Q215 for 2016 production Gearing Q215 orders weak due to depressed oil & gas and mining markets Services orders rebounded in Q215 but blade repair activity in H115 50% lower than PY Order Backlog – $M Solid backlog at Q215 totaled $169M >90% of H215
Slide 5: Wind Market Outlook
Wind Market Outlook 7/30/15 © 2015 Broadwind Energy, Inc. All rights reserved. PTC Clean Power Plan 2-year extension passed Senate Finance Committee with numerous other tax extenders Start construction by 2016, allows completion by 2018 Appears to be strong bi-partisan support for the overall tax ex
Slide 6: Gearing Business Update
Gearing Business Update Orders across industry down ~30%; will rebound somewhat in Q3 and show strength in Q4 Sales team focusing on key accounts, strengthening relationships Aggressive cost management offsetting some of volume shortfall Expanding penetration into other markets © 2015 Broadwind Ener
Slide 7: Consolidated Financial Results
Consolidated Financial Results 7/30/15 © 2015 Broadwind Energy, Inc. All rights reserved. 7 Sales down 5% from Q2 2014: Towers and Weldments +4%, Gearing -36%, Services -23% Gross margin of 11.1% – down 230 bp from Q2 2014 due to less profitable tower mix, but up sharply from 1.4% in Q1 2015 Record-
Slide 8: Towers and Weldments
Towers and Weldments Q2 2014 Q2 2015 YTD 2014 YTD 2015 Orders ($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 9: 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 10: 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 11: Liquidity
Liquidity 7/30/15 © 2015 Broadwind Energy, Inc. All rights reserved. 11 Inventories came down $3M in Q2; expect to decline further $5-7M by 9/30/15 and >$10M by year-end Working capital remains high due to draw-down of deposits and high supplier payments Working capital expected to decline by >$15M
Slide 12: Balance Sheet
Balance Sheet Q2 14 YE 2014 Q2 15 Cash Assets $11,582 20,256 $591 Op Working Capital 26,047 13,853 38,207 Net PPE 66,336 62,952 58,722 Other Assets 11,911 8,476 8,273 (Debt and Cap Leases) (4,433) (4,111) (8,944) (Other Liabilities) (14,803) (13,046) (11,262) Equity 96,640 88,380 85,587 Cash assets
Slide 13: Consolidated Outlook
Consolidated Outlook 7/30/15 © 2015 Broadwind Energy, Inc. All rights reserved. 13 * Estimate Q3 Outlook Assumptions Tower production continues at levels similar to Q2; annual 500 tower capacity remains goal Gearing continues to manage well through oil & gas and mining downturn, depreciation down $.
Slide 14: Summary
Summary Towers segment back on track Q3 15 similar to Q2 15; $63-65M of revenue, $4-6M of EBITDA, $1-2M of Op Inc Expect to close one or more major tower orders in Q3 Towers still on track to achieve production milestone of 500 towers Cash balances will climb to $5-7M by 9/30/15 and >$15M at year-en
Slide 15: 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. 7/30/15 © 2015 Broadwind Energy, In