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Aug. 6, 2020, 4:32 p.m. EDT

TPI Composites, Inc. Announces Second Quarter 2020 Earnings Results - Extends Agreements with GE and Adds New Lines for Nordex in India and GE in Mexico - Adds Approximately $800 Million of Potential Contract Value

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Capital expenditures were $15.0 million for the three months ended June 30, 2020 compared to $19.0 million during the same period in 2019. Our capital expenditures have primarily related to machinery and equipment for new facilities and expansion and improvements at existing facilities.

We ended the quarter with $96.7 million of cash and cash equivalents and net debt was $142.5 million as compared to $71.8 million at December 31, 2019. For the quarter we used $29.6 million of cash flows in operations and invested $15.0 million in capital expenditures for a negative free cash flow of $44.6 million.

2020 Guidance

On April 23, 2020, TPI announced the withdrawal of its fiscal year 2020 financial guidance first issued on February 27, 2020. At this time, TPI will not be reinstating its fiscal year 2020 financial guidance due to the inability to forecast or quantify with reasonable accuracy the full duration and financial magnitude of the impact of the COVID-19 pandemic.

Conference Call and Webcast Information

TPI Composites will host an investor conference call this afternoon, Thursday, August 6, 2020 at 5:00 pm ET. Interested parties are invited to listen to the conference call which can be accessed live over the phone by dialing 1-855-327-6837, or for international callers, 1-631-891-4304. A replay will be available two hours after the call and can be accessed by dialing 1-844-512-2921, or for international callers, 1-412-317-6671. The passcode for the live call and the replay is 10010271. The replay will be available until August 13, 2020. Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the Investors section of the Company's website at www.tpicomposites.com . The online replay will be available for a limited time beginning immediately following the call.

About TPI Composites, Inc.

TPI Composites, Inc. is the only independent manufacturer of composite wind blades for the wind energy market with a global manufacturing footprint. TPI delivers high-quality, cost-effective composite solutions through long-term relationships with leading OEMs in the wind and transportation markets. TPI is headquartered in Scottsdale, Arizona and operates factories in the U.S., China, Mexico, Turkey and India. TPI operates additional engineering development centers in Denmark and Germany.

Forward-Looking Statements

This release contains forward-looking statements which are made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements, among other things, concerning: the impact of the COVID-19 pandemic on our business, effects on our financial statements and our financial outlook; our business strategy, including anticipated trends and developments in and management plans for our business and the wind industry and other markets in which we operate; our projected annual revenue growth; competition; future financial results, operating results, revenues, gross margin, operating expenses, profitability, products, projected costs, warranties, our ability to improve our operating margins, and capital expenditures. These forward-looking statements are often characterized by the use of words such as "estimate," "expect," "anticipate," "project," "plan," "intend," "seek," "believe," "forecast," "foresee," "likely," "may," "should," "goal," "target," "might," "will," "could," "predict," "continue" and the negative or plural of these words and other comparable terminology. Forward-looking statements are only predictions based on our current expectations and our projections about future events. You should not place undue reliance on these forward-looking statements. We undertake no obligation to update any of these forward-looking statements for any reason. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from those expressed or implied by these statements. These factors include, but are not limited to, the matters discussed in "Risk Factors," in our Annual Report on Form 10-K and other reports that we will file with the SEC.

Non-GAAP Definitions

This press release includes unaudited non-GAAP financial measures, including EBITDA, adjusted EBITDA, net cash (debt) and free cash flow. We define EBITDA as net income (loss) plus interest expense (including losses on extinguishment of debt and net of interest income), income taxes and depreciation and amortization. We define adjusted EBITDA as EBITDA plus any share-based compensation expense, any realized gains or losses from foreign currency remeasurement, any realized gains or losses from the sale of assets and asset impairments and any restructuring costs. We define net cash (debt) as the total unrestricted cash and cash equivalents less the total principal amount of debt outstanding. We define free cash flow as net cash flow from operating activities less capital expenditures. We present non-GAAP measures when we believe that the additional information is useful and meaningful to investors. Non-GAAP financial measures do not have any standardized meaning and are therefore unlikely to be comparable to similar measures presented by other companies. The presentation of non-GAAP financial measures is not intended to be a substitute for, and should not be considered in isolation from, the financial measures reported in accordance with GAAP. See below for a reconciliation of certain non-GAAP financial measures to the comparable GAAP measures as well as our Investor Presentation which can be found in the Investors section at www.tpicomposites.com .

Investor Relations

480-315-8742

investors@TPIComposites.com







        TPI COMPOSITES, INC. AND SUBSIDIARIES
        TABLE ONE - CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
        (UNAUDITED)
                                                               Three Months Ended               Six Months Ended
                                                               June 30,                         June 30,
        (in thousands, except per share data)                      2020            2019             2020            2019
        Net sales                                              $   373,817     $   330,771      $   730,453     $   630,551
        Cost of sales                                              367,644         285,319          716,119         568,357
        Startup and transition costs                               10,920          22,901           22,954          41,079
        Total cost of goods sold                                   378,564         308,220          739,073         609,436
        Gross profit (loss)                                        (4,747  )       22,551           (8,620  )       21,115
        General and administrative expenses                        6,887           9,208            16,383          17,193
        Realized loss on sale of assets and asset impairments      1,440           4,972            3,358           7,207
        Restructuring charges, net                                 181             3,874            298             3,874
        Income (loss) from operations                              (13,255 )       4,497            (28,659 )       (7,159  )
        Other income (expense):
        Interest income                                            8               31               40              82
        Interest expense                                           (2,553  )       (2,274  )        (4,356  )       (4,273  )
        Realized loss on foreign currency remeasurement            (1,928  )       (967    )        (968    )       (4,769  )
        Miscellaneous income                                       939             1,016            1,634           1,718
        Total other expense                                        (3,534  )       (2,194  )        (3,650  )       (7,242  )
        Income (loss) before income taxes                          (16,789 )       2,303            (32,309 )       (14,401 )
        Income tax benefit (provision)                             (49,312 )       (475    )        (34,284 )       4,125
        Net income (loss)                                      $   (66,101 )   $   1,828        $   (66,593 )   $   (10,276 )
        Weighted-average common shares outstanding:
        Basic                                                      35,299          35,033           35,256          34,970
        Diluted                                                    35,299          36,369           35,256          34,970
        Net income (loss) per common share:
        Basic                                                  $   (1.87   )   $   0.05         $   (1.89   )   $   (0.29   )
        Diluted                                                $   (1.87   )   $   0.05         $   (1.89   )   $   (0.29   )
        Non-GAAP Measures (unaudited):
        EBITDA                                                 $   (2,628  )   $   11,671       $   (5,349  )   $   7,574
        Adjusted EBITDA                                        $   3,295       $   23,421       $   4,591       $   26,346
        








        TPI COMPOSITES, INC. AND SUBSIDIARIES
        TABLE TWO - CONDENSED CONSOLIDATED BALANCE SHEETS
        (UNAUDITED)
                                                       June 30,           December 31,
        (in thousands)                                         2020               2019
        Assets
        Current assets:
        Cash and cash equivalents                      $       96,657     $       70,282
        Restricted cash                                        312                992
        Accounts receivable                                    133,147            184,012
        Contract assets                                        214,556            166,515
        Prepaid expenses                                       15,983             10,047
        Other current assets                                   25,900             29,843
        Inventories                                            12,368             6,731
        Total current assets                                   498,923            468,422
        Noncurrent assets:
        Property, plant, and equipment, net                    211,175            205,007
        Operating lease right of use assets                    162,767            122,351
        Other noncurrent assets                                22,420             30,897
        Total assets                                   $       895,285    $       826,677
        Liabilities and Stockholders' Equity
        Current liabilities:
        Accounts payable and accrued expenses          $       267,833    $       293,104
        Accrued warranty                                       56,772             47,639
        Current maturities of long-term debt                   25,285             13,501
        Current operating lease liabilities                    21,918             16,629
        Contract liabilities                                   2,447              3,008
        Total current liabilities                              374,255            373,881
        Noncurrent liabilities:
        Long-term debt, net of debt issuance costs and
        current maturities                                     212,617            127,888
        Noncurrent operating lease liabilities                 154,759            113,883
        Other noncurrent liabilities                           24,809             5,975
        Total liabilities                                      766,440            621,627
        Total stockholders' equity                             128,845            205,050
        Total liabilities and stockholders' equity     $       895,285    $       826,677
        Non-GAAP Measure (unaudited):
        Net debt                                       $       (142,524 ) $       (71,779 )
        








        TPI COMPOSITES, INC. AND SUBSIDIARIES
        TABLE THREE - CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
        (UNAUDITED)
                                                                                        Three Months Ended                   Six Months Ended
                                                                                        June 30,                             June 30,
        (in thousands)                                                                       2020              2019               2020              2019
        Net cash provided by (used in) operating activities                             $    (29,573 )    $    10,573        $    (27,005 )    $    (1,518  )
        Net cash used in investing activities                                                (15,047 )         (19,030 )          (42,030 )         (37,739 )
        Net cash provided by (used in) financing activities                                  32,173            (10,629 )          97,255            10,446
        Impact of foreign exchange rates on cash, cash equivalents and restricted cash       (719    )         (297    )          (2,525  )         696
        Cash, cash equivalents and restricted cash, beginning of period                      110,610           80,644             71,749            89,376
        Cash, cash equivalents and restricted cash, end of period                       $    97,444       $    61,261        $    97,444       $    61,261
        Non-GAAP Measure (unaudited):
        Free cash flow                                                                  $    (44,620 )    $    (8,457  )     $    (69,035 )    $    (39,257 )
        








        TPI COMPOSITES, INC. AND SUBSIDIARIES
        TABLE FOUR - RECONCILIATION OF NON-GAAP MEASURES
        (UNAUDITED)
        EBITDA and adjusted EBITDA are reconciled as follows: Three Months Ended                   Six Months Ended
                                                              June 30,                             June 30,
        (in thousands)                                            2020              2019               2020            2019
        Net income (loss)                                     $   (66,101  )   $    1,828          $   (66,593 )   $   (10,276 )
        Adjustments:
        Depreciation and amortization                             11,616            7,125              22,644          17,784
        Interest expense (net of interest income)                 2,545             2,243              4,316           4,191
        Income tax provision (benefit)                            49,312            475                34,284          (4,125  )
        EBITDA                                                    (2,628   )        11,671             (5,349  )       7,574
        Share-based compensation expense                          2,374             1,937              5,316           2,922
        Realized loss on foreign currency remeasurement           1,928             967                968             4,769
        Realized loss on sale of assets and asset impairments     1,440             4,972              3,358           7,207
        Restructuring charges, net                                181               3,874              298             3,874
        Adjusted EBITDA                                       $   3,295        $    23,421         $   4,591       $   26,346
        Net debt is reconciled as follows:                    June 30,         December 31,
        (in thousands)                                            2020              2019
        Cash and cash equivalents                             $   96,657       $    70,282
        Less total debt, net of debt issuance costs               (237,902 )        (141,389 )
        Less debt issuance costs                                  (1,279   )        (672     )
        Net debt                                              $   (142,524 )   $    (71,779  )
        Free cash flow is reconciled as follows:              Three Months Ended                   Six Months Ended
                                                              June 30,                             June 30,
        (in thousands)                                            2020              2019               2020            2019
        Net cash provided by (used in) operating activities   $   (29,573  )   $    10,573         $   (27,005 )   $   (1,518  )
        Less capital expenditures                                 (15,047  )        (19,030  )         (42,030 )       (37,739 )
        Free cash flow                                        $   (44,620  )   $    (8,457   )     $   (69,035 )   $   (39,257 )
        


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COMTEX_368992485/2010/2020-08-06T16:32:23

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