Highlights:
Broadwind Energy, Inc. (NASDAQ:BWEN) reported sales of $43.4
million in Q2 2017, flat compared to Q2 2016. Towers and Weldments
segment revenue was down 10% due to lower sales volumes compared to
the prior year, partially offset by higher pass-through material
content. Offsetting the weaker tower revenue was $3.0 million of
sales from the Process Systems segment due primarily to the
acquisition of Red Wolf Company, LLC earlier this year.
The Company reported a net loss from continuing operations of
$.7 million, or $.05 per share, in Q2 2017, compared to break-even
in Q2 2016, largely due to the addition of amortization expenses
associated with the acquisition of Red Wolf.
The Company reported near break-even results from discontinued
operations in Q2 2017, compared to a net loss from discontinued
operations of $.5 million, or $.03 per share in Q2 2016, as
activities in the discontinued segment have substantially wound
down.
The Company reported non-GAAP adjusted EBITDA (earnings before
interest, taxes, depreciation, amortization, share-based payments
and restructuring costs) of $2.0 million in Q2 2017, essentially
flat compared to $2.1 million in Q2 2016 (please refer to the
reconciliation of GAAP measures to non-GAAP measures at the end of
this release).
Broadwind CEO Stephanie Kushner stated, “We had a strong first
half and our second quarter results were in line with expectations.
Despite lower tower volumes, we produced consistently and reliably
and delivered solid segment profits on fewer, more complex towers.
The productivity gains and cost management demonstrated by towers
management are critical as our turbine customers are facing
increasing cost pressure from windfarm developers.
“In Gearing, we are seeing the initial impact of a recovery in
oil and gas volumes. Importantly, as our operating performance has
improved in this business, we have added some significant new
customers. The market recovery and new customer wins resulted in
slightly higher revenue during the second quarter, but we expect
quarterly revenues to rise to the $8 million run rate beginning in
Q3, and position us for profitability in this segment.”
Ms. Kushner continued, “Integration of the Red Wolf acquisition
is continuing. Our second quarter results in the Process Systems
segment were weaker than expected, due in part to shipping delays
in both Red Wolf and for compressed natural gas (CNG) units. We
expect quarterly revenues to recover to the $5 million or more
range during the second half of this year. First half sales for Red
Wolf have been impacted by lower demand for certain types of
aftermarket kits and unanticipated variability in shipment
patterns. We expect some recovery in the second half and remain
excited by the opportunities presented by this business
segment.
“In the third quarter we expect a further reduction in tower
volumes, offset by growth in the other segments, with total
revenues in the $30 million range, and EBITDA of approximately $1
million. We are working with our customers to support a reduction
in their component inventories during the next few quarters, and
expect to see recovery in their offtake beginning in mid-2018. All
indications point to a strong market through at least 2020.”
For the six months ended June 30, 2017, revenue totaled $99.4
million, compared to $90.1 million for the six months ended June
30, 2016. The 10% increase was due primarily to $6.3 million of
sales from the Process Systems segment due to the acquisition of
Red Wolf earlier this year and higher sales in the Towers and
Weldments segment. The increased sales in the Towers and Weldments
segment was driven by higher shipments in Q1 2017 in advance of the
100% safe harbor production tax credit deadline and significantly
improved production flow in the Abilene, Texas tower plant.
Net income from continuing operations for the six months ended
June 30, 2017 totaled $5.8 million, or $.39 per share, compared to
a net loss from continuing operations of $.3 million, or $.02 per
share, for the six months ended June 30, 2016. The current year net
income includes a $5.1 million, or $.34 per share, income tax
benefit due primarily to the partial release of a tax valuation
allowance related to the Red Wolf acquisition. The remaining $.05
per share improvement was due to improved production flow in the
Towers and Weldments segment. Net loss from discontinued operations
for the six months ended June 30, 2017 totaled $.2 million compared
to $.5 million for the same period in 2016. The Company reported
Non-GAAP adjusted EBITDA of $5.9 million for the six months ended
June 30, 2017, compared to $3.9 million for the same period in
2016. The increase was due primarily to the productivity
improvements in the Towers and Weldments segment (please refer to
the reconciliation of GAAP measures to non-GAAP measures at the end
of this release).
Orders and Backlog
The Company booked $17.6 million of net new orders in Q2 2017,
down significantly from $176.2 million of net new orders booked in
Q2 2016 which included initial bookings under a 3-year tower
framework agreement. Orders in the Towers and Weldments segment
totaled $1.5 million in Q2 2017 reflecting the weaker demand for
towers as customers utilize inventories built to support the terms
of the production tax credit qualification period. Gearing segment
orders totaled $11.6 million in Q2 2017, more than double Q2 2016
orders of $5.6 million, due to recovery in the oil and gas
industry, and the expansion of the commercial organization. Process
Systems segment orders totaled $4.4 million in Q2 2017.
At June 30, 2017, total backlog was $155.9 million, compared to
a backlog of $218.9 million at June 30, 2016.
Segment Results
Towers and Weldments Broadwind Energy produces
fabrications for wind, oil and gas, mining and other industrial
applications, specializing in the production of wind turbine
towers.
Towers and Weldments segment sales totaled $34.3 million in Q2
2017, compared to $38.0 million in Q2 2016. The decrease in sales
was due to a 19% decrease in tower production versus the prior
year, partly offset by higher prices due to a more complex tower
design and higher material costs, which are generally passed
through to customers. Near-term demand for towers has declined as
key customers are reducing inventories built in 2016 and early 2017
to support the qualification terms of the production tax
credit.
Despite reduced volume, Towers and Weldments operating income
increased by $.1 million to $2.8 million in Q2 2017, compared to
$2.7 million in Q2 2016 due to an improved production mix, higher
labor productivity and successful cost reduction initiatives.
Towers and Weldments segment net income in Q2 2017 totaled $2.0
million compared to $1.8 million in Q2 2016. Non-GAAP adjusted
EBITDA totaled $3.9 million in Q2 2017, flat compared to Q2 2016
due mainly to the factors described above (please refer to the
reconciliation of GAAP measures to non-GAAP measures at the end of
this release).
GearingBroadwind Energy engineers, builds and
remanufactures precision gears and gearboxes for oil and gas,
mining, steel and wind applications.
Gearing segment sales totaled $6.1 million in Q2 2017, compared
to $5.4 million in Q2 2016 due to stronger sales to oil and gas
customers, partially offset by lower sales to wind customers.
Gearing segment operating loss totaled $.6 million in Q2 2017,
significantly below a $1.2 million loss in Q2 2016. The improvement
was due to the initial impact of the increase in volume,
significant productivity improvements and the absence of a $.3
million severance expense from Q2 2016. Net loss for the Gearing
segment narrowed similarly to $.6 million compared to $1.2 million
in Q2 2016. Non-GAAP adjusted EBITDA for Q2 2017 was slightly
positive, compared to Non-GAAP adjusted EBITDA loss of $.5 million
in Q2 2016, due to the factors described above (please refer to the
reconciliation of GAAP measures to non-GAAP measures at the end of
this release).
Process SystemsBroadwind Energy designs and
manufactures custom, modular systems for compression, filtration
and other specialized process applications for the global market.
On February 1, 2017 the Company acquired Red Wolf which has been
combined with the Abilene-based CNG and fabrication business,
previously reported as a part of Towers and Weldments, to form the
Process Systems segment.
Process Systems sales for Q2 2017 totaled $3.0 million,
reflecting $1 million of shipping curtailments imposed by a key
customer at quarter-end. For Q2 2017, Process Systems net loss
totaled $1.1 million, due to low Red Wolf volumes and no CNG unit
completions, and including $.4 million of amortization associated
with acquisition accounting. The non-GAAP adjusted EBITDA loss
totaled $.6 million in Q2 2017 (please refer to the reconciliation
of GAAP measures to non-GAAP measures at the end of this
release).
Corporate
Corporate and other expenses totaled $1.6 million in Q2 2017,
compared to $1.4 million in Q2 2016, due to increased insurance
expense, partially offset by a reduction in incentive
compensation.
Cash and Liquidity
During Q2 2017, operating working capital (accounts receivable
and inventory, net of accounts payable and customer deposits)
increased to $23.0 million, or 13% of sales, due to declining
customer deposits and the timing of customer receipts.
Capital expenditures, net of disposals, in Q2 2017 totaled $1.0
million. Expenditures included investments to upgrade the coatings
systems in the tower plants, and outlays associated with the
expansion of the Abilene, Texas tower plant.
Cash assets (cash and short-term investments) totaled $.2
million at June 30, 2017, essentially unchanged from March 31,
2017.
Debt and capital leases totaled $19.1 million at June 30, 2017,
including the $2.6 million New Markets Tax Credit loan, which is
expected to be substantially forgiven when it matures in 2018. The
Company’s $25 million credit line with The PrivateBank and Trust
Company had a balance of $13.7 million at June 30, 2017 and
$10.1million of availability.
About Broadwind Energy, Inc.Broadwind Energy
(NASDAQ:BWEN) is a precision manufacturer of structures, equipment
and components for clean tech and other specialized applications.
From gears and gearing systems for wind, oil and gas and mining
applications, to wind towers and industrial weldments, we have
solutions for the clean tech, energy and infrastructure needs of
the future. With facilities throughout the U.S., Broadwind Energy's
talented team is committed to helping customers maximize
performance of their investments—quicker, easier and smarter. Find
out more at www.bwen.com
Forward-Looking StatementsThis release contains
“forward looking statements”—that is, statements related to future,
not past, events—as defined in Section 21E of the Securities
Exchange Act of 1934, as amended, that reflect our current
expectations regarding our future growth, results of operations,
financial condition, cash flows, performance, business prospects
and opportunities, as well as assumptions made by, and information
currently available to, our management. Forward looking statements
include any statement that does not directly relate to a current or
historical fact. We have tried to identify forward looking
statements by using words such as “anticipate,” “believe,”
“expect,” “intend,” “will,” “should,” “may,” “plan” and similar
expressions, but these words are not the exclusive means of
identifying forward looking statements. Forward looking statements
include any statement that does not directly relate to a current or
historical fact. Our forward-looking statements may include or
relate to our beliefs, expectations, plans and/or assumptions with
respect to the following: (i) state, local and federal regulatory
frameworks affecting the industries in which we compete, including
the wind energy industry, and the related extension, continuation
or renewal of federal tax incentives and grants and state renewable
portfolio standards; (ii) our customer relationships and our
substantial dependency on a few significant customers and our
efforts to diversify our customer base and sector focus and
leverage relationships across business units; (iii) our ability to
continue to grow our business organically and through acquisitions;
(iv) the sufficiency of our liquidity and alternate sources of
funding, if necessary; (v) our ability to realize revenue from
customer orders and backlog; (vi) our ability to operate our
business efficiently, manage capital expenditures and costs
effectively, and generate cash flow; (vii) the economy and the
potential impact it may have on our business, including our
customers; (viii) the state of the wind energy market and other
energy and industrial markets generally and the impact of
competition and economic volatility in those markets; (ix) the
effects of market disruptions and regular market volatility,
including fluctuations in the price of oil, gas and other
commodities; (x) the effects of the recent change of
administrations in the U.S. federal government; (xi) our ability to
successfully integrate and operate the business of Red Wolf
Company, LLC and to identify, negotiate and execute future
acquisitions; and (xii) the potential loss of tax benefits if we
experience an “ownership change” under Section 382 of the Internal
Revenue Code of 1986, as amended. These statements are based on
information currently available to us and are subject to various
risks, uncertainties and other factors that could cause our actual
growth, results of operations, financial condition, cash flows,
performance, business prospects and opportunities to differ
materially from those expressed in, or implied by, these
statements. We are under no duty to update any of these statements.
You should not consider any list of such factors to be an
exhaustive statement of all of the risks, uncertainties or other
factors that could cause our current beliefs, expectations, plans
and/or assumptions to change.
BROADWIND ENERGY, INC. AND SUBSIDIARIES |
CONSOLIDATED BALANCE SHEETS |
(IN THOUSANDS) |
|
|
|
June 30, |
|
December 31, |
|
|
2017 |
|
2016 |
ASSETS |
|
(Unaudited) |
|
|
CURRENT
ASSETS: |
|
|
|
|
Cash and
cash equivalents |
|
$ |
182 |
|
|
$ |
18,699 |
|
Short-term investments |
|
|
- |
|
|
|
3,171 |
|
Restricted cash |
|
|
- |
|
|
|
39 |
|
Accounts
receivable, net of allowance for doubtful accounts of $193 and
$145 as of June 30, 2017 and December 31, 2016, respectively |
|
|
21,471 |
|
|
|
11,865 |
|
Inventories, net |
|
|
21,349 |
|
|
|
21,159 |
|
Prepaid
expenses and other current assets |
|
|
1,620 |
|
|
|
2,449 |
|
Current
assets held for sale |
|
|
474 |
|
|
|
808 |
|
Total
current assets |
|
|
45,096 |
|
|
|
58,190 |
|
LONG-TERM
ASSETS: |
|
|
|
|
Property
and equipment, net |
|
|
57,398 |
|
|
|
54,606 |
|
Goodwill |
|
|
5,218 |
|
|
|
- |
|
Other
intangible assets, net |
|
|
17,020 |
|
|
|
4,572 |
|
Other
assets |
|
|
253 |
|
|
|
294 |
|
TOTAL
ASSETS |
|
$ |
124,985 |
|
|
$ |
117,662 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
Line of
credit and notes payable |
|
$ |
13,713 |
|
|
$ |
- |
|
Current
portions of capital lease obligations |
|
|
979 |
|
|
|
465 |
|
Accounts
payable |
|
|
14,595 |
|
|
|
15,852 |
|
Accrued
liabilities |
|
|
7,421 |
|
|
|
8,430 |
|
Customer
deposits |
|
|
5,184 |
|
|
|
18,011 |
|
Current
liabilities held for sale |
|
|
438 |
|
|
|
493 |
|
Total
current liabilities |
|
|
42,330 |
|
|
|
43,251 |
|
|
|
|
|
|
LONG-TERM
LIABILITIES: |
|
|
|
|
Long-term
debt, net of current maturities |
|
|
2,600 |
|
|
|
2,600 |
|
Long-term
capital lease obligations, net of current portions |
|
|
1,789 |
|
|
|
1,038 |
|
Other |
|
|
3,674 |
|
|
|
2,190 |
|
Total
long-term liabilities |
|
|
8,063 |
|
|
|
5,828 |
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES |
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY: |
|
|
|
|
Preferred
stock, $0.001 par value; 10,000,000 shares authorized; no shares
issued or outstanding |
|
|
- |
|
|
|
- |
|
Common
stock, $0.001 par value; 30,000,000 shares authorized; 15,310,090
and 15,175,767 shares issued as of June 30, 2017 and December 31,
2016, respectively |
|
|
15 |
|
|
|
15 |
|
Treasury stock, at cost, 273,937 shares as of June 30, 2017 and
December 31, 2016, respectively |
|
(1,842 |
) |
|
|
(1,842 |
) |
Additional paid-in capital |
|
|
379,338 |
|
|
|
378,876 |
|
Accumulated deficit |
|
|
(302,919 |
) |
|
|
(308,466 |
) |
Total
stockholders' equity |
|
|
74,592 |
|
|
|
68,583 |
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
124,985 |
|
|
$ |
117,662 |
|
BROADWIND ENERGY, INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF OPERATIONS |
(IN THOUSANDS, EXCEPT PER SHARE DATA) |
(UNAUDITED) |
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
43,362 |
|
|
$ |
43,380 |
|
|
$ |
99,422 |
|
|
$ |
90,137 |
|
Cost of sales |
|
|
39,490 |
|
|
|
39,238 |
|
|
|
89,176 |
|
|
|
82,033 |
|
Gross profit |
|
|
3,872 |
|
|
|
4,142 |
|
|
|
10,246 |
|
|
|
8,104 |
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES: |
|
|
|
|
|
|
|
|
Selling, general and
administrative |
|
|
3,917 |
|
|
|
3,850 |
|
|
|
8,337 |
|
|
|
7,925 |
|
Intangible
amortization |
|
|
471 |
|
|
|
111 |
|
|
|
822 |
|
|
|
222 |
|
Total
operating expenses |
|
|
4,388 |
|
|
|
3,961 |
|
|
|
9,159 |
|
|
|
8,147 |
|
Operating (loss)
income |
|
|
(516 |
) |
|
|
181 |
|
|
|
1,087 |
|
|
|
(43 |
) |
|
|
|
|
|
|
|
|
|
OTHER (EXPENSE)
INCOME, net: |
|
|
|
|
|
|
|
|
Interest expense,
net |
|
|
(217 |
) |
|
|
(152 |
) |
|
|
(356 |
) |
|
|
(306 |
) |
Other, net |
|
|
29 |
|
|
|
5 |
|
|
|
29 |
|
|
|
17 |
|
Total
other expense, net |
|
|
(188 |
) |
|
|
(147 |
) |
|
|
(327 |
) |
|
|
(289 |
) |
|
|
|
|
|
|
|
|
|
Net (loss) income
before benefit for income taxes |
|
|
(704 |
) |
|
|
34 |
|
|
|
760 |
|
|
|
(332 |
) |
Benefit for income
taxes |
|
|
(16 |
) |
|
|
(8 |
) |
|
|
(5,034 |
) |
|
|
(16 |
) |
(LOSS) INCOME
FROM CONTINUING OPERATIONS |
|
|
(688 |
) |
|
|
42 |
|
|
|
5,794 |
|
|
|
(316 |
) |
LOSS FROM DISCONTINUED OPERATIONS |
|
|
(92 |
) |
|
|
(516 |
) |
|
|
(247 |
) |
|
|
(535 |
) |
NET (LOSS)
INCOME |
|
$ |
(780 |
) |
|
$ |
(474 |
) |
|
$ |
5,547 |
|
|
$ |
(851 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS) PER COMMON SHARE - BASIC: |
|
|
|
|
|
|
|
|
(Loss) income from
continuing operations |
|
$ |
(0.05 |
) |
|
$ |
0.00 |
|
|
$ |
0.39 |
|
|
$ |
(0.02 |
) |
Loss from discontinued
operations |
|
|
(0.00 |
) |
|
|
(0.03 |
) |
|
|
(0.02 |
) |
|
|
(0.04 |
) |
Net (loss) income |
|
$ |
(0.05 |
) |
|
$ |
(0.03 |
) |
|
$ |
0.37 |
|
|
$ |
(0.06 |
) |
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE COMMON SHARES OUTSTANDING - BASIC |
|
|
15,014 |
|
|
|
14,835 |
|
|
|
14,972 |
|
|
|
14,797 |
|
|
|
|
|
|
|
|
|
|
NET (LOSS) INCOME
PER COMMON SHARE - DILUTED: |
|
|
|
|
|
|
|
|
(Loss) income from
continuing operations |
|
$ |
(0.05 |
) |
|
$ |
0.00 |
|
|
$ |
0.38 |
|
|
$ |
(0.02 |
) |
Loss from discontinued
operations |
|
|
(0.00 |
) |
|
|
(0.03 |
) |
|
|
(0.02 |
) |
|
|
(0.04 |
) |
Net (loss) income |
|
$ |
(0.05 |
) |
|
$ |
(0.03 |
) |
|
$ |
0.36 |
|
|
$ |
(0.06 |
) |
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE COMMON SHARES OUTSTANDING - DILUTED |
|
|
15,014 |
|
|
|
14,835 |
|
|
|
15,322 |
|
|
|
14,797 |
|
BROADWIND ENERGY, INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
(IN THOUSANDS) |
(UNAUDITED) |
|
|
|
Six Months Ended June 30, |
|
|
|
2017 |
|
|
2016 |
|
CASH FLOWS FROM
OPERATING ACTIVITIES: |
|
|
|
Net
income (loss) |
|
$ |
5,547 |
|
$ |
(851 |
) |
Loss from
discontinued operations |
|
|
(247 |
) |
|
(535 |
) |
Income
(loss) from continuing operations |
|
|
5,794 |
|
|
(316 |
) |
|
|
|
|
Adjustments to
reconcile net cash used in operating activities: |
|
|
|
Depreciation and amortization expense |
|
|
4,304 |
|
|
3,443 |
|
Deferred
income taxes |
|
|
(5,034 |
) |
|
- |
|
Stock-based compensation |
|
|
462 |
|
|
432 |
|
Allowance
for doubtful accounts |
|
|
5 |
|
|
75 |
|
Gain on
disposal of assets |
|
|
(12 |
) |
|
(138 |
) |
Changes
in operating assets and liabilities: |
|
|
|
Accounts
receivable |
|
|
(6,846 |
) |
|
(7,165 |
) |
Inventories |
|
|
4,586 |
|
|
3,171 |
|
Prepaid
expenses and other current assets |
|
|
829 |
|
|
189 |
|
Accounts
payable |
|
|
(2,609 |
) |
|
1,891 |
|
Accrued
liabilities |
|
|
(3,177 |
) |
|
(476 |
) |
Customer
deposits |
|
|
(12,833 |
) |
|
1,433 |
|
Other
non-current assets and liabilities |
|
|
28 |
|
|
(751 |
) |
Net cash (used in)
provided by operating activities of continuing operations |
|
|
(14,503 |
) |
|
1,788 |
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES: |
|
|
|
Cash paid in acquisition |
|
(16,449 |
) |
|
- |
|
Purchases
of available for sale securities |
|
|
- |
|
|
(3,581 |
) |
Sales of
available for sale securities |
|
|
2,221 |
|
|
95 |
|
Maturities of available for sale securities |
|
|
950 |
|
|
6,060 |
|
Purchases
of property and equipment |
|
|
(4,304 |
) |
|
(1,966 |
) |
Proceeds
from disposals of property and equipment |
|
|
67 |
|
|
554 |
|
Net cash (used in)
provided by investing activities of continuing operations |
|
|
(17,515 |
) |
|
1,162 |
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES: |
|
|
|
Net
proceeds from lines of credit and notes payable |
|
|
13,713 |
|
|
- |
|
Payments
on long-term debt |
|
|
- |
|
|
(2,799 |
) |
Principal
payments on capital leases |
|
|
(317 |
) |
|
(328 |
) |
Net cash provided by
(used in) financing activities of continuing operations |
|
|
13,396 |
|
|
(3,127 |
) |
|
|
|
|
|
|
|
|
DISCONTINUED
OPERATIONS: |
|
|
|
Operating
cash flows |
|
|
64 |
|
|
907 |
|
Investing
cash flows |
|
|
- |
|
|
303 |
|
Financing
cash flows |
|
|
- |
|
|
(12 |
) |
Net cash provided by
discontinued operations |
|
|
64 |
|
|
1,198 |
|
|
|
|
|
Add: Cash balance of
discontinued operations, beginning of period |
|
|
2 |
|
|
- |
|
Less: Cash balance of
discontinued operations, end of period |
|
|
- |
|
|
- |
|
|
|
|
|
NET (DECREASE)
INCREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED
CASH |
|
|
(18,556 |
) |
|
1,021 |
|
CASH, CASH
EQUIVALENTS, AND RESTRICTED CASH beginning of the
period |
|
|
18,738 |
|
|
6,519 |
|
CASH, CASH
EQUIVALENTS, AND RESTRICTED CASH end of the period |
|
$ |
182 |
|
$ |
7,540 |
|
|
|
|
|
Supplemental
cash flow information: |
|
|
|
Interest
paid |
|
$ |
217 |
|
$ |
267 |
|
Income
taxes paid |
|
$ |
22 |
|
$ |
12 |
|
Contingent consideration related to business acquisition |
$ |
2,534 |
|
$ |
- |
|
Non-cash
investing and financing activities: |
|
|
|
Issuance
of restricted stock grants |
|
$ |
462 |
|
$ |
432 |
|
Red Wolf
acquisition: |
|
|
|
Assets acquired |
|
$ |
26,491 |
|
$ |
- |
|
Liabilities
assumed |
|
$ |
7,508 |
|
$ |
- |
|
BROADWIND ENERGY, INC. AND SUBSIDIARIES |
SELECTED SEGMENT FINANCIAL INFORMATION |
(IN THOUSANDS) |
(UNAUDITED) |
|
|
|
Three Months Ended |
|
Six Months
Ended |
|
|
June 30, |
|
June 30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
ORDERS: |
|
|
|
|
Towers
and Weldments |
|
$ |
1,478 |
|
|
$ |
170,637 |
|
|
$ |
30,567 |
|
|
$ |
206,072 |
|
Gearing |
|
|
11,644 |
|
|
|
5,588 |
|
|
|
18,963 |
|
|
|
9,129 |
|
Process
Systems |
|
|
4,444 |
|
|
|
- |
|
|
|
8,058 |
|
|
|
- |
|
Total
orders |
|
$ |
17,566 |
|
|
$ |
176,225 |
|
|
$ |
57,588 |
|
|
$ |
215,201 |
|
|
|
|
|
|
|
|
|
|
REVENUES: |
|
|
|
|
Towers
and Weldments |
|
$ |
34,327 |
|
|
$ |
37,963 |
|
|
$ |
83,222 |
|
|
$ |
79,978 |
|
Gearing |
|
|
6,071 |
|
|
|
5,417 |
|
|
|
9,942 |
|
|
|
10,177 |
|
Process
Systems |
|
|
2,964 |
|
|
|
- |
|
|
|
6,258 |
|
|
|
- |
|
Corporate
and Other |
|
|
- |
|
|
|
- |
|
|
|
|
|
(18 |
) |
Total
revenues |
|
$ |
43,362 |
|
|
$ |
43,380 |
|
|
$ |
99,422 |
|
|
$ |
90,137 |
|
|
|
|
|
|
|
|
|
|
OPERATING PROFIT/(LOSS): |
|
|
|
|
Towers
and Weldments |
|
$ |
2,801 |
|
|
$ |
2,725 |
|
|
$ |
8,649 |
|
|
$ |
5,966 |
|
Gearing |
|
|
(634 |
) |
|
|
(1,189 |
) |
|
|
(2,165 |
) |
|
|
(2,392 |
) |
Process
Systems |
|
|
(1,099 |
) |
|
|
- |
|
|
|
(1,921 |
) |
|
|
- |
|
Corporate
and Other |
|
|
(1,584 |
) |
|
|
(1,355 |
) |
|
|
(3,476 |
) |
|
|
(3,617 |
) |
Total
operating profit/(loss) |
|
$ |
(516 |
) |
|
$ |
181 |
|
|
$ |
1,087 |
|
|
$ |
(43 |
) |
|
|
|
|
|
|
|
|
|
Non-GAAP Financial MeasureThe Company provides
non-GAAP adjusted EBITDA (earnings before interest, income taxes,
depreciation, amortization, share based compensation, and other
stock payments) as supplemental information regarding the Company’s
business performance. The Company’s management uses adjusted EBITDA
when it internally evaluates the performance of the Company’s
business, reviews financial trends and makes operating and
strategic decisions. The Company believes that this non-GAAP
financial measure is useful to investors because it provides
investors with a better understanding of the Company’s past
financial performance and future results, and it allows investors
to evaluate the Company’s performance using the same methodology
and information as used by the Company’s management. The Company's
definition of adjusted EBITDA may be different from similar
non-GAAP financial measures used by other companies and/or
analysts.
BROADWIND ENERGY, INC. AND SUBSIDIARIES |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
(IN THOUSANDS) |
(UNAUDITED) |
|
Consolidated |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
Net Income/(Loss) from
continuing operations |
$ |
(688 |
) |
|
$ |
42 |
|
|
$ |
5,794 |
|
|
$ |
(316 |
) |
Interest Expense |
|
217 |
|
|
|
152 |
|
|
|
356 |
|
|
|
306 |
|
Income Tax
Provision/(Benefit) |
|
(16 |
) |
|
|
(8 |
) |
|
|
(5,034 |
) |
|
|
(16 |
) |
Depreciation and
Amortization |
|
2,203 |
|
|
|
1,787 |
|
|
|
4,304 |
|
|
|
3,443 |
|
Share-based
Compensation and Other Stock Payments |
|
241 |
|
|
|
174 |
|
|
|
462 |
|
|
|
433 |
|
Restructuring
Expense |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Adjusted
EBITDA (Non-GAAP) |
$ |
1,957 |
|
|
$ |
2,147 |
|
|
$ |
5,882 |
|
|
$ |
3,850 |
|
Towers and
Weldments Segment |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
Net Income |
$ |
2,024 |
|
$ |
1,801 |
|
$ |
6,028 |
|
$ |
3,941 |
Interest
Expense/(Benefit) |
|
20 |
|
|
6 |
|
|
35 |
|
|
16 |
Income Tax
Provision/(Benefit) |
|
772 |
|
|
923 |
|
|
2,603 |
|
|
2,027 |
Depreciation and
Amortization |
|
1,070 |
|
|
1,094 |
|
|
2,162 |
|
|
2,060 |
Share-based
Compensation and Other Stock Payments |
|
58 |
|
|
37 |
|
|
115 |
|
|
75 |
Adjusted
EBITDA (Non-GAAP) |
$ |
3,944 |
|
$ |
3,861 |
|
$ |
10,943 |
|
$ |
8,119 |
Gearing
Segment |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
Net Loss |
$ |
(638 |
) |
|
$ |
(1,194 |
) |
|
$ |
(2,175 |
) |
|
$ |
(2,401 |
) |
Interest Expense |
|
2 |
|
|
|
3 |
|
|
|
6 |
|
|
|
7 |
|
Income Tax
Provision/(Benefit) |
|
2 |
|
|
|
1 |
|
|
|
4 |
|
|
|
2 |
|
Depreciation and
Amortization |
|
612 |
|
|
|
641 |
|
|
|
1,238 |
|
|
|
1,280 |
|
Share-based
Compensation and Other Stock Payments |
|
23 |
|
|
|
25 |
|
|
|
41 |
|
|
|
72 |
|
Adjusted
EBITDA (Non-GAAP) |
$ |
1 |
|
|
$ |
(524 |
) |
|
$ |
(886 |
) |
|
$ |
(1,040 |
) |
Process
Systems |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Net Income/(Loss) |
$ |
(1,103 |
) |
|
$ |
- |
|
$ |
(5,769 |
) |
|
$ |
- |
Interest Expense |
|
1 |
|
|
|
- |
|
|
3 |
|
|
|
- |
Income Tax
Provision/(Benefit) |
|
- |
|
|
|
- |
|
|
3,841 |
|
|
|
- |
Depreciation and
Amortization |
|
467 |
|
|
|
- |
|
|
801 |
|
|
|
- |
Share-based
Compensation and Other Stock Payments |
|
10 |
|
|
|
- |
|
|
15 |
|
|
|
- |
Adjusted
EBITDA (Non-GAAP) |
$ |
(625 |
) |
|
$ |
- |
|
$ |
(1,109 |
) |
|
$ |
- |
Corporate and
Other |
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
Net Income/(Loss) |
$ |
(971 |
) |
|
$ |
(565 |
) |
|
$ |
7,710 |
|
|
$ |
(1,856 |
) |
Interest Expense |
|
194 |
|
|
|
143 |
|
|
|
312 |
|
|
|
283 |
|
Income Tax
Provision/(Benefit) |
|
(790 |
) |
|
|
(932 |
) |
|
|
(11,482 |
) |
|
|
(2,045 |
) |
Depreciation and
Amortization |
|
54 |
|
|
|
52 |
|
|
|
103 |
|
|
|
103 |
|
Share-based
Compensation and Other Stock Payments |
|
150 |
|
|
|
112 |
|
|
|
291 |
|
|
|
286 |
|
Adjusted
EBITDA (Non-GAAP) |
$ |
(1,363 |
) |
|
$ |
(1,190 |
) |
|
$ |
(3,066 |
) |
|
$ |
(3,229 |
) |
BWEN INVESTOR CONTACT: Joni Konstantelos, 708.780.4819 joni.konstantelos@bwen.com
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