For those looking to find strong Industrial Products stocks, it is prudent to search for companies in the group that are outperforming their peers. Broadwind Energy, Inc. (BWEN) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Industrial Products peers, we might be able to answer that question. Broadwind Energy, Inc. is a member of the Industr ...

Momentum investors typically don't time the market or "buy low and sell high." In other words, they avoid betting on cheap stocks and waiting long for them to recover. Instead, they believe that "buying high and selling higher" is the way to make far more money in lesser time. Everyone likes betting on fast-moving trending stocks, but it isn't easy to determine the right entry point. These stocks often lose momentum when their future growth potential fails to justify their swelled-up valuation. In that phas ...

Core Insights - Global economies are increasingly shifting towards clean energy to meet climate change targets, leading to renewed investor interest in renewable energy companies [1][2] - Investments in clean energy have surged by 40% since 2020, with potential for further growth as government legislation supports the sector [2] Company Summaries Nextracker (NXT) - Nextracker specializes in solar trackers and software solutions, optimizing solar energy generation by following the sun's movements [5] - The company reported Q3'24 revenue of $710.4 million, a 38% year-over-year increase, with adjusted EBITDA rising 168% [6] - Nextracker's debt-to-EBITDA ratio is 0.41, indicating strong debt repayment capability [6] First Solar (FSLR) - First Solar is a leading producer of photovoltaic cells, essential for converting sunlight into electricity [9] - The company experienced a 45% year-over-year increase in net sales in Q1'24, with EPS rising to $2.21, a 452% improvement from the previous year [10][11] - First Solar's debt-to-EBITDA ratio stands at 0.42, reflecting a solid financial position [11] Broadwind (BWEN) - Broadwind manufactures clean tech infrastructure and wind energy equipment components, benefiting from the transition to clean energy [13] - The company reported a 15.1% year-over-year revenue growth in FY'23, reaching $203.5 million, with earnings improving to a profit of 36 cents [14][15] - Broadwind's debt-to-EBITDA ratio is 2, which, while higher than its peers, remains below the accepted threshold of 3, indicating potential for future growth [15]

PART I. FINANCIAL INFORMATION [Item 1. Unaudited Financial Statements](index=3&type=section&id=Item%201.%20Unaudited%20Financial%20Statements) The company presents its unaudited condensed consolidated financial statements for the three months ended March 31, 2024 and 2023 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets and liabilities decreased from year-end 2023, while total stockholders' equity increased | Metric | March 31, 2024 ($ thousands) | December 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Total Assets | 123,071 | 135,156 | | Total Current Assets | 58,281 | 69,746 | | Cash | 1,073 | 1,099 | | Accounts Receivable, net | 14,601 | 19,231 | | AMP Credit Receivable | 1,732 | 7,051 | | Total Liabilities | 65,030 | 79,137 | | Total Current Liabilities | 39,654 | 53,612 | | Line of credit & current maturities of long-term debt | 1,428 | 5,903 | | Customer Deposits | 11,403 | 16,500 | | Total Stockholders' Equity | 58,041 | 56,019 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net income significantly increased despite lower total revenues, driven by a favorable product mix and reduced operating expenses | Metric | Three Months Ended March 31, 2024 ($ thousands) | Three Months Ended March 31, 2023 ($ thousands) | Change ($ thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenues | 37,616 | 48,873 | (11,257) | (23.0)% | | Cost of sales | 30,979 | 41,897 | (10,918) | (26.1)% | | Gross profit | 6,637 | 6,976 | (339) | (4.9)% | | Selling, general and administrative | 4,394 | 5,526 | (1,132) | (20.5)% | | Operating income | 2,078 | 1,282 | 796 | 62.1% | | Net income | 1,510 | 769 | 741 | 96.4% | | Basic net income per share | 0.07 | 0.04 | 0.03 | 75.0% | | Diluted net income per share | 0.07 | 0.04 | 0.03 | 75.0% | [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Total stockholders' equity increased from year-end 2023, primarily due to net income and share-based compensation | Metric | March 31, 2024 ($ thousands) | December 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Total Stockholders' Equity | 58,041 | 56,019 | | Common Shares Issued (March 31, 2024) | 21,947,606 | 21,840,301 | | Additional Paid-in Capital | 399,848 | 399,336 | | Accumulated Deficit | (339,987) | (341,497) | | Net Income | 1,510 | 769 | | Share-based Compensation | 225 | 178 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities improved significantly, while cash used in investing and financing activities increased | Cash Flow Activity | Three Months Ended March 31, 2024 ($ thousands) | Three Months Ended March 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | 5,857 | (25,984) | | Net cash used in investing activities | (1,744) | (1,065) | | Net cash (used in) provided by financing activities | (4,139) | 16,046 | | Net decrease in cash | (26) | (11,003) | | Cash at end of period | 1,073 | 1,729 | - The increase in net cash provided by operating activities was primarily attributable to a decrease in accounts receivable and proceeds from the sale of 2023 AMP credits[137](index=137&type=chunk) - The decrease in net cash provided by financing activities was primarily due to decreased net borrowings under the 2022 Credit Facility in the current year period[123](index=123&type=chunk) [NOTE 1 — BASIS OF PRESENTATION](index=8&type=section&id=NOTE%201%20%E2%80%94%20BASIS%20OF%20PRESENTATION) The company is a precision manufacturer for clean technology and other specialized applications, primarily in the U.S - The Company is a precision manufacturer of structures, equipment, and components for clean technology and other specialized applications, primarily serving energy, mining, and infrastructure sectors in the U.S[82](index=82&type=chunk) - The U.S. wind energy industry accounted for **39% of the Company's revenue** during the first three months of 2024, down from 50% in the prior year[82](index=82&type=chunk) [Liquidity](index=8&type=section&id=Liquidity) Liquidity is supported by cash from operations, credit facilities, and potential access to capital markets - As of March 31, 2024, debt and finance lease obligations totaled **$13,628 thousand**, with **$5,864 thousand** outstanding from the senior secured term loan under the 2022 Credit Facility[83](index=83&type=chunk)[201](index=201&type=chunk) - The Company had the ability to borrow an additional **$21,326 thousand** under the 2022 Credit Facility as of March 31, 2024[17](index=17&type=chunk)[201](index=201&type=chunk) - The Company utilizes supply chain financing arrangements, selling accounts receivable to banking institutions without recourse, to accelerate collections and manage cash flow[86](index=86&type=chunk)[188](index=188&type=chunk) - No shares of common stock were issued under the Sales Agreement during the three months ended March 31, 2024, with approximately **$11,667 thousand** remaining available for issuance[63](index=63&type=chunk)[160](index=160&type=chunk) - The company faces risks of cash flow and liquidity issues if assumptions regarding production, sales, customer collections, and finalization of supply agreements are materially inconsistent with expectations[88](index=88&type=chunk)[135](index=135&type=chunk) [Management's Use of Estimates](index=10&type=section&id=Management's%20Use%20of%20Estimates) Financial statement preparation requires management to make significant estimates and assumptions affecting reported amounts - Significant estimates include inventory reserves, warranty reserves, impairment of long-lived assets, allowance for doubtful accounts, health insurance reserves, and valuation allowances on deferred taxes[89](index=89&type=chunk) [NOTE 2 — REVENUES](index=10&type=section&id=NOTE%202%20%E2%80%94%20REVENUES) Revenue decreased due to lower Heavy Fabrications sales, partially offset by growth in the Industrial Solutions segment | Revenue Source | Three Months Ended March 31, 2024 ($ thousands) | Three Months Ended March 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Heavy Fabrications | 22,016 | 31,593 | | Gearing | 8,337 | 11,965 | | Industrial Solutions | 7,994 | 5,423 | | Eliminations | (731) | (108) | | Consolidated | 37,616 | 48,873 | - Heavy Fabrications segment revenue **decreased by 30%** due to a 40% decrease in wind tower revenue, resulting from a 44% decrease in tower sections sold as a global wind turbine manufacturer shifted orders from 2024 to 2025[197](index=197&type=chunk) - Industrial Solutions segment revenue **increased by 47%** primarily due to the timing of shipments of new and aftermarket gas turbine content[157](index=157&type=chunk)[195](index=195&type=chunk) - Gearing segment revenue **decreased by 30%** due to reduced shipments for industrial, mining, and O&G customers[157](index=157&type=chunk)[195](index=195&type=chunk) [NOTE 3 — EARNINGS PER SHARE](index=12&type=section&id=NOTE%203%20%E2%80%94%20EARNINGS%20PER%20SHARE) Basic and diluted earnings per share increased in Q1 2024 compared to the prior year, reflecting higher net income | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net income | $1,510 | $769 | | Basic net income per share | $0.07 | $0.04 | | Diluted net income per share | $0.07 | $0.04 | | Weighted average common shares outstanding (Basic) | 21,594,664 | 20,869,035 | | Weighted average common shares outstanding (Diluted) | 21,806,782 | 21,387,014 | [NOTE 4 — INVENTORIES](index=12&type=section&id=NOTE%204%20%E2%80%94%20INVENTORIES) Net inventories remained stable, with a decrease in raw materials offset by an increase in work-in-process | Inventory Component | March 31, 2024 ($ thousands) | December 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Raw materials | 21,381 | 24,651 | | Work-in-process | 14,138 | 10,390 | | Finished goods | 4,109 | 4,595 | | Less: Reserve | (2,242) | (2,231) | | Net inventories | 37,386 | 37,405 | [NOTE 5 — AMP CREDITS](index=13&type=section&id=NOTE%205%20%E2%80%94%20AMP%20CREDITS) The company recognized Advanced Manufacturing Production (AMP) credits, which reduced its cost of sales - Gross AMP credits recognized in Q1 2024 totaled **$1,872 thousand**, with a 6.5% discount ($122 thousand) and administrative costs ($33 thousand) recognized in cost of sales[106](index=106&type=chunk) - AMP credits are introduced by the IRA for manufacturers of eligible wind components, qualifying for **$0.03 per watt** for each wind tower produced and sold in the U.S. from 2023 through 2032[97](index=97&type=chunk) - The remaining 2023 AMP credit receivable of **$7,541 thousand** (after a $490 thousand loss on sale) was collected during the first quarter of 2024[74](index=74&type=chunk) [NOTE 6 — INTANGIBLE ASSETS](index=13&type=section&id=NOTE%206%20%E2%80%94%20INTANGIBLE%20ASSETS) Intangible assets, primarily customer relationships and trade names, decreased slightly due to ongoing amortization | Intangible Asset | March 31, 2024 Net Book Value ($ thousands) | December 31, 2023 Net Book Value ($ thousands) | | :--- | :--- | :--- | | Customer relationships | 480 | 545 | | Trade names | 1,419 | 1,519 | | Total Intangible Assets | 1,899 | 2,064 | | Remaining Weighted Average Amortization Period | 3.1 years | 3.3 years | - Intangible assets are amortized on a straight-line basis over their estimated useful lives, with a remaining life range from 2 to 4 years[107](index=107&type=chunk) [NOTE 7 — ACCRUED LIABILITIES](index=13&type=section&id=NOTE%207%20%E2%80%94%20ACCRUED%20LIABILITIES) Total accrued liabilities decreased slightly, with notable changes in professional fees, warranty, and payroll accruals | Accrued Liability | March 31, 2024 ($ thousands) | December 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Accrued payroll and benefits | 5,180 | 5,051 | | Accrued property taxes | 20 | — | | Income taxes payable | 30 | 254 | | Accrued professional fees | 9 | 140 | | Accrued warranty liability | 25 | 322 | | Self-insured workers compensation reserve | 5 | 21 | | Accrued sales tax | 10 | 310 | | Accrued other | 20 | 379 | | Total accrued liabilities | 6,406 | 6,477 | [NOTE 8 — DEBT AND CREDIT AGREEMENTS](index=15&type=section&id=NOTE%208%20%E2%80%94%20DEBT%20AND%20CREDIT%20AGREEMENTS) Total debt decreased significantly due to a reduction in the line of credit, and the company complied with all covenants | Debt Component | March 31, 2024 ($ thousands) | December 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Line of credit | — | 4,657 | | Other notes payable | 1,826 | 1,361 | | Long-term debt | 5,864 | 6,135 | | Total debt | 7,690 | 12,153 | | Less: current maturities | (1,428) | (5,903) | | Long-term debt, net of current maturities | 6,262 | 6,250 | - As of March 31, 2024, **$5,864 thousand** was outstanding under the 2022 Credit Facility, with an additional **$21,326 thousand** available for borrowing[17](index=17&type=chunk) - The effective interest rate for the senior secured revolving credit facility was **7.32%** and for the senior secured term loan was **7.82%** as of March 31, 2024[17](index=17&type=chunk) - The company was **in compliance with all financial covenants** under the 2022 Credit Facility as of March 31, 2024[17](index=17&type=chunk) [NOTE 9 — LEASES](index=15&type=section&id=NOTE%209%20%E2%80%94%20LEASES) The company's future minimum lease payments for finance and operating leases total $30,222 thousand | Lease Type | Finance Leases ($ thousands) | Operating Leases ($ thousands) | Total ($ thousands) | | :--- | :--- | :--- | :--- | | Total lease payments | 6,718 | 23,504 | 30,222 | | Present value of lease obligations | 5,938 | 17,288 | 23,226 | | Current portion of lease obligations | (2,205) | (1,914) | (4,119) | | Long-term portion of lease obligations | 3,733 | 15,374 | 19,107 | - The weighted average remaining lease term for operating leases was **6.9 years** and for finance leases was **2.9 years** as of March 31, 2024[20](index=20&type=chunk) - The weighted average discount rate for operating leases was **8.9%** and for finance leases was **8.0%** as of March 31, 2024[20](index=20&type=chunk) [NOTE 10 — FAIR VALUE MEASUREMENTS](index=16&type=section&id=NOTE%2010%20%E2%80%94%20FAIR%20VALUE%20MEASUREMENTS) The carrying amounts of the company's financial instruments approximate their fair values due to their short-term nature - Financial instruments are categorized into a three-level fair value hierarchy based on the observability of inputs used in valuation, with Level 1 being the most reliable and Level 3 requiring significant management judgment[24](index=24&type=chunk) [NOTE 11 — INCOME TAXES](index=17&type=section&id=NOTE%2011%20%E2%80%94%20INCOME%20TAXES) The company maintains a full valuation allowance against deferred tax assets and has significant NOL carryforwards - Provision for income taxes was **$39 thousand** for Q1 2024, compared to $23 thousand for Q1 2023[25](index=25&type=chunk) - As of March 31, 2024, the company had a **full valuation allowance** recorded against deferred tax assets and no unrecognized tax benefits[9](index=9&type=chunk)[25](index=25&type=chunk) - The company had federal and unapportioned state NOL carryforwards of **$290,233 thousand** as of December 31, 2023, with $227,781 thousand generally expiring starting in 2026[26](index=26&type=chunk) - An annual limitation of **$14,284 thousand** on NOL usage is imposed under Section 382 of the IRC due to prior ownership changes[27](index=27&type=chunk) - A Stockholder Rights Plan is designed to deter beneficial ownership of **4.9% or more** of common stock to preserve NOL carryforwards under Section 382[28](index=28&type=chunk)[29](index=29&type=chunk) [NOTE 12 — SHARE-BASED COMPENSATION](index=18&type=section&id=NOTE%2012%20%E2%80%94%20SHARE-BASED%20COMPENSATION) Share-based compensation expense increased in Q1 2024, with no stock option activity during the period | Share-based Compensation Expense | Three Months Ended March 31, 2024 ($ thousands) | Three Months Ended March 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Cost of sales | 29 | 23 | | Selling, general and administrative | 196 | 155 | | Net effect on net income | 225 | 178 | | Basic earnings per share reduction | 0.01 | 0.01 | | Diluted earnings per share reduction | 0.01 | 0.01 | | Restricted Stock Unit Activity | Number of Shares (March 31, 2024) | | :--- | :--- | | Unvested as of December 31, 2023 | 687,206 | | Vested | (1,398) | | Unvested as of March 31, 2024 | 685,808 | [NOTE 13 — LEGAL PROCEEDINGS AND OTHER MATTERS](index=18&type=section&id=NOTE%2013%20%E2%80%94%20LEGAL%20PROCEEDINGS%20AND%20OTHER%20MATTERS) Management believes the outcome of current legal proceedings will not materially affect the company's financial condition - Management believes that the final outcome of legal proceedings will not have a material adverse effect on the Company's results of operations, financial condition, or cash flows[12](index=12&type=chunk) [NOTE 14 — RECENT ACCOUNTING PRONOUNCEMENTS](index=19&type=section&id=NOTE%2014%20%E2%80%94%20RECENT%20ACCOUNTING%20PRONOUNCEMENTS) Recent accounting pronouncements are not expected to have a material impact on the company's financial statements - ASU 2023-09 (Income Tax Disclosures) will be effective for annual periods beginning December 31, 2025, and ASU 2023-07 (Segment Reporting Disclosures) will be effective for annual periods beginning December 31, 2024[141](index=141&type=chunk)[161](index=161&type=chunk) [NOTE 15— SEGMENT REPORTING](index=19&type=section&id=NOTE%2015%E2%80%94%20SEGMENT%20REPORTING) The company operates through three reportable segments: Heavy Fabrications, Gearing, and Industrial Solutions - Heavy Fabrications provides steel towers and adapters for the U.S. wind energy industry (**39% of Q1 2024 revenue**) and has diversified into mining, construction, and other infrastructure markets[82](index=82&type=chunk)[142](index=142&type=chunk) - Gearing manufactures loose gearing, gearboxes, and systems, and provides heat treat services for aftermarket and OEM applications in mining, wind energy, steel, and oil and gas[143](index=143&type=chunk) - Industrial Solutions provides supply chain solutions, light fabrication, inventory management, and kitting and assembly services, primarily for combined cycle natural gas turbines and expanding into U.S. wind power generation[144](index=144&type=chunk) | Segment | Q1 2024 Net Revenues ($ thousands) | Q1 2023 Net Revenues ($ thousands) | | :--- | :--- | :--- | | Heavy Fabrications | 22,016 | 31,593 | | Gearing | 8,337 | 11,965 | | Industrial Solutions | 7,994 | 5,423 | | Consolidated | 37,616 | 48,873 | | Segment | Q1 2024 Operating Income (Loss) ($ thousands) | Q1 2023 Operating Income (Loss) ($ thousands) | | :--- | :--- | :--- | | Heavy Fabrications | 2,046 | 2,790 | | Gearing | 25 | 581 | | Industrial Solutions | 1,767 | 622 | | Corporate | (1,760) | (2,711) | | Consolidated | 2,078 | 1,282 | [NOTE 16 — COMMITMENTS AND CONTINGENCIES](index=20&type=section&id=NOTE%2016%20%E2%80%94%20COMMITMENTS%20AND%20CONTINGENCIES) The company is subject to environmental regulations and maintains reserves for credit losses and liquidated damages - The company's operations are subject to environmental laws and regulations governing air emissions, wastewater discharges, hazardous materials, and contamination[168](index=168&type=chunk) - An allowance for credit losses is assessed using the CECL model, with activity in the accounts receivable allowance liability showing a balance of **$97 thousand** at March 31, 2024, compared to $31 thousand at March 31, 2023[149](index=149&type=chunk)[169](index=169&type=chunk)[170](index=170&type=chunk) - A reserve for liquidated damages of **$84 thousand** was maintained at March 31, 2024, and December 31, 2023, for potential delivery or production delays[150](index=150&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, highlighting increased net income despite lower revenues [KEY METRICS USED BY MANAGEMENT TO MEASURE PERFORMANCE](index=22&type=section&id=KEY%20METRICS%20USED%20BY%20MANAGEMENT%20TO%20MEASURE%20PERFORMANCE) Management uses GAAP and non-GAAP measures like Adjusted EBITDA to evaluate performance and manage liquidity | Metric | March 31, 2024 ($ thousands) | March 31, 2023 ($ thousands) | | :--- | :--- | :--- | | Net revenues | 37,616 | 48,873 | | Net income | 1,510 | 769 | | Adjusted EBITDA | 4,170 | 4,098 | | Capital expenditures | 1,744 | 1,065 | | Free cash flow | (2,452) | (23,335) | | Operating working capital | 24,286 | 26,843 | | Total debt | 7,690 | 24,952 | | Total orders | 28,996 | 39,602 | | Backlog at end of period | 159,912 | 287,808 | - **Adjusted EBITDA increased** to $4,170 thousand in Q1 2024 from $4,098 thousand in Q1 2023[174](index=174&type=chunk) - New orders **decreased to $28,996 thousand** in Q1 2024 from $39,602 thousand in Q1 2023, primarily due to timing of wind tower orders[177](index=177&type=chunk) - Backlog **decreased to $159,912 thousand** at March 31, 2024, from $287,808 thousand at March 31, 2023[174](index=174&type=chunk) [OUR BUSINESS](index=23&type=section&id=OUR%20BUSINESS) Net income increased significantly in Q1 2024, driven by a more profitable product mix and lower operating expenses - Net income **increased by 96.4% to $1,510 thousand** in Q1 2024, compared to $769 thousand in Q1 2023[194](index=194&type=chunk)[195](index=195&type=chunk) - The increase in net income was primarily due to a more profitable product mix, the absence of proxy-contest related expenses, and higher sales in the Industrial Solutions segment[194](index=194&type=chunk) [RESULTS OF OPERATIONS](index=24&type=section&id=RESULTS%20OF%20OPERATIONS) Consolidated revenues decreased by 23%, but operating income grew significantly due to reduced operating expenses | Metric | Q1 2024 ($ thousands) | Q1 2023 ($ thousands) | Change ($ thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenues | 37,616 | 48,873 | (11,257) | (23.0)% | | Gross profit | 6,637 | 6,976 | (339) | (4.9)% | | Operating expenses | 4,559 | 5,694 | (1,135) | (19.9)% | | Operating income | 2,078 | 1,282 | 796 | 62.1% | | Net income | 1,510 | 769 | 741 | 96.4% | - Gross profit decreased by **$339 thousand**, primarily due to lower sales, partially offset by a more profitable product mix[159](index=159&type=chunk) - Operating expenses decreased due to the absence of proxy-contest related expenses recognized in the prior year[159](index=159&type=chunk) [Heavy Fabrications Segment](index=25&type=section&id=Heavy%20Fabrications%20Segment) The segment's revenues decreased due to shifted wind tower orders, but operating margin improved from a better product mix | Metric | Q1 2024 ($ thousands) | Q1 2023 ($ thousands) | | :--- | :--- | :--- | | Orders | 11,221 | 20,236 | | Tower sections sold | 78 | 140 | | Revenues | 22,016 | 31,593 | | Operating income | 2,046 | 2,790 | | Operating margin | 9.3% | 8.8% | - Wind tower orders decreased significantly due to timing, but industrial fabrication orders **increased by 18%** from mining customers[197](index=197&type=chunk) - Segment revenues **decreased by 30%**, with wind tower revenue down 40% due to a 44% decrease in tower sections sold[197](index=197&type=chunk) [Gearing Segment](index=25&type=section&id=Gearing%20Segment) The segment's orders and revenues declined, driven by reduced demand from oil and gas customers | Metric | Q1 2024 ($ thousands) | Q1 2023 ($ thousands) | | :--- | :--- | :--- | | Orders | 10,446 | 12,393 | | Revenues | 8,337 | 11,965 | | Operating income | 25 | 581 | | Operating margin | 0.3% | 4.9% | - Orders **decreased by 16%** due to reduced demand from O&G customers, partially offset by increased demand from mining and aftermarket wind customers[184](index=184&type=chunk) - Operating income **decreased by $556 thousand**, primarily attributable to lower sales[198](index=198&type=chunk) [Industrial Solutions Segment](index=25&type=section&id=Industrial%20Solutions%20Segment) The segment's orders, revenues, and operating income all increased, driven by new gas turbine projects | Metric | Q1 2024 ($ thousands) | Q1 2023 ($ thousands) | | :--- | :--- | :--- | | Orders | 7,329 | 6,973 | | Revenues | 7,994 | 5,423 | | Operating income | 1,767 | 622 | | Operating margin | 22.1% | 11.5% | - Orders increased primarily due to new gas turbine projects, partially offset by reduced aftermarket projects[186](index=186&type=chunk) - Operating income increased significantly due to higher sales and a more profitable product mix[186](index=186&type=chunk) [Corporate and Other](index=26&type=section&id=Corporate%20and%20Other) Corporate expenses decreased due to the absence of prior-year proxy contest fees and lower medical costs - Corporate and Other expenses decreased due to the absence of professional fees from a contested proxy election in the prior year and lower medical costs[200](index=200&type=chunk) [LIQUIDITY, FINANCIAL POSITION AND CAPITAL RESOURCES](index=26&type=section&id=LIQUIDITY,%20FINANCIAL%20POSITION%20AND%20CAPITAL%20RESOURCES) The company's liquidity improved with strong operating cash flow, and management believes resources are adequate - Cash totaled **$1,073 thousand** as of March 31, 2024, a decrease of $26 thousand from December 31, 2023[201](index=201&type=chunk) - Net cash provided by operating activities was **$5,857 thousand** in Q1 2024, a significant improvement from net cash used of $25,984 thousand in Q1 2023[125](index=125&type=chunk)[137](index=137&type=chunk) - Net cash used in investing activities increased to **$1,744 thousand** in Q1 2024, primarily due to higher purchases of property and equipment[122](index=122&type=chunk)[125](index=125&type=chunk) - Net cash used in financing activities was **$4,139 thousand** in Q1 2024, compared to net cash provided of $16,046 thousand in Q1 2023, mainly due to decreased net borrowings under the 2022 Credit Facility[123](index=123&type=chunk)[125](index=125&type=chunk) - The company anticipates current cash, the 2022 Credit Facility, operational cash generation, and potential equity/debt sales will meet liquidity needs for the next twelve months[203](index=203&type=chunk) [CRITICAL ACCOUNTING ESTIMATES](index=27&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) There were no material changes to the company's critical accounting estimates during the first quarter of 2024 - No material changes in critical accounting estimates during Q1 2024[124](index=124&type=chunk) [CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=28&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This report contains forward-looking statements that are subject to various risks and uncertainties - Forward-looking statements reflect current expectations regarding future growth, results of operations, financial condition, cash flows, performance, business prospects, and opportunities[127](index=127&type=chunk) - These statements are subject to various risks, uncertainties, and other factors that could cause actual results to differ materially, including those set forth under 'Risk Factors' in the Annual Report on Form 10-K[127](index=127&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=29&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, these disclosures are not required - The company is a smaller reporting company and is not required to provide market risk disclosures[129](index=129&type=chunk) [Item 4. Controls and Procedures](index=29&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2024 - Disclosure controls and procedures were evaluated and deemed **effective** as of March 31, 2024[130](index=130&type=chunk) - **No material changes** in internal control over financial reporting occurred during the three months ended March 31, 2024[131](index=131&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=30&type=section&id=Item%201.%20Legal%20Proceedings) Information regarding legal proceedings is incorporated by reference from Note 13 of the financial statements - Legal proceedings information is incorporated by reference from Note 13[133](index=133&type=chunk) [Item 1A. Risk Factors](index=30&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K - Risk Factors identified in the Annual Report on Form 10-K for the year ended December 31, 2023, continue to represent the most significant risks[110](index=110&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=30&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None to report[111](index=111&type=chunk) [Item 3. Defaults Upon Senior Securities](index=30&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities during the period - None to report[112](index=112&type=chunk) [Item 4. Mine Safety Disclosures](index=30&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not Applicable[113](index=113&type=chunk) [Item 5. Other Information](index=30&type=section&id=Item%205.%20Other%20Information) No Rule 10b5-1 trading arrangements were adopted, terminated, or modified by directors or officers in Q1 2024 - No Rule 10b5-1 trading arrangements were adopted, terminated, or modified by directors or officers during Q1 2024[114](index=114&type=chunk) [Item 6. Exhibits](index=30&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the report, including certifications and iXBRL financial data - The exhibit index includes corporate governance documents, certifications (Rule 13a-14(a), 18 U.S.C. Section 1350), and financial information in iXBRL format[116](index=116&type=chunk) [SIGNATURES](index=32&type=section&id=SIGNATURES) The report is duly signed on behalf of the company by its President and Chief Executive Officer - The report was signed by Eric B. Blashford, President and Chief Executive Officer, on May 14, 2024[121](index=121&type=chunk)

Financial Data and Key Metrics Changes - The company booked $29 million in orders for Q1, a decline compared to the prior year but up nearly 44% sequentially from Q4 2023, indicating a favorable order trend across all divisions [17] - Q1 adjusted EBITDA was $4.2 million, nearly double the prior year period, with net income of $1.5 million compared to $0.8 million in the prior year [24][27] - Gross margin and EBITDA margin improved by 330 basis points and 270 basis points respectively, marking the fifth consecutive quarter of profitability despite challenges in the wind sector [21] Business Line Data and Key Metrics Changes - Heavy Fabrication segment revenue was $22 million, down 30% year-over-year due to reduced tower production, partially offset by increased sales in mining equipment and natural gas pressure-reducing systems [25] - Gearing revenue was $8.3 million, a 30% reduction year-over-year, with a book-to-bill ratio of 1.3x indicating ongoing recovery [25] - Industrial Solutions segment revenue reached nearly $8 million, the strongest since the Red Wolf acquisition in 2017, with orders of $7.3 million remaining at historically high levels [30] Market Data and Key Metrics Changes - The company experienced an 18% increase in orders for non-wind revenue streams, primarily related to mining and industrial markets [49] - The backlog for Industrial Solutions stood at $16.1 million, reflecting strong demand for natural gas turbine offerings [30] - The company anticipates continued softness in the oil and gas gear market for the next several quarters [24] Company Strategy and Development Direction - The company is focusing on diversifying its revenue streams and expanding into higher-margin adjacent markets, including aerospace and defense, as it progresses towards AS9100 quality certification [18][55] - The management has aligned the cost structure to reflect lower production volumes while repurposing talent towards non-wind demand across diverse end markets [34] - The company is optimistic about the long-term economics of wind energy, particularly with the visibility provided by a 10-year tax credit [34] Management's Comments on Operating Environment and Future Outlook - Management noted that interest rates and inflation are stabilizing, which may encourage developers to invest in projects that were previously unprofitable [5] - There is cautious optimism regarding a potential increase in domestic onshore wind activity in 2025 and 2026, despite current challenges [62] - The company is seeing significant momentum in the gas turbine industry, with quoting activity up over 40% [35] Other Important Information - The company has taken significant actions to align its cost structure, contributing over $4 million in annualized cost savings starting from Q1 [46] - The company has a strong cash position with over $22 million available under its credit facility and has reduced net debt by over $3 million [52] - The release of the Broadwind clean fuels L70 low-flow PRS unit is on track for Q3, including a version for renewable natural gas [22] Q&A Session Summary Question: What is the impact of the advanced manufacturing tax credit on EBITDA for the heavy fabrication segment? - The impact was consistent between the two quarters, with no significant changes noted [91] Question: Is there a catalyst for the wind business to recover? - Management indicated that the industry appears to have hit a trough, with expectations for order activity to increase in late 2024 into 2025 [62] Question: How does the company view the potential for acquisitions? - The company is beginning to entertain acquisition opportunities more aggressively, particularly in precision manufacturing and machining [92]

| --- | --- | --- | --- | |-------|-------|-------|-------| | | | | | | | | | | This document 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, ...

Broadwind Energy, Inc. (BWEN) came out with quarterly earnings of $0.07 per share, beating the Zacks Consensus Estimate of a loss of $0.07 per share. This compares to earnings of $0.07 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 200%. A quarter ago, it was expected that this company would post earnings of $0.04 per share when it actually produced earnings of $0.05, delivering a surprise of 25%. Over the last four quarters ...

EXHIBIT 99.1 Broadwind Announces First Quarter 2024 Results MANAGEMENT COMMENTARY "New order activity accelerated on a sequential basis across each of our reporting segments during the first quarter, with first quarter orders increasing nearly 44% versus the fourth quarter 2023," continued Blashford. "Within our gearing segment, orders increased on a sequential basis, driven by our wind, mining and energy markets, while within Industrial Solutions, we continue to see strong activity levels from gas turbine ...

Generally speaking, undervalued stocks under $5 should be avoided. Yeah, I know that’s not exactly the catchiest tagline to offer. Let me explain.If you believe that the market represents the culmination at that moment of all available public information, then nothing really is under or overvalued. Securities are priced exactly where they should be given the information at hand. However, the thesis behind bargain ideas – particularly undervalued stocks under $5 – is that it’s practically impossible to know ...

Financial Data and Key Metrics Changes - In 2023, the company generated total revenue of $203 million, with adjusted EBITDA reaching a record $21.5 million, reflecting strong performance across all divisions [5][11] - For Q4 2023, total revenue was $47 million, with adjusted EBITDA of $4.4 million, an increase of over $4 million compared to the prior year [6][32] - The total consolidated backlog at the end of Q4 was approximately $183 million, down from $297 million in the prior year [7] Business Line Data and Key Metrics Changes - Heavy Fabrication segment revenue for Q4 was $29.5 million, a 24% increase year-over-year, driven by wind tower sales and mining equipment [8] - Gearing revenue was $11 million, a 5% decrease year-over-year due to reduced activity in oil and gas and mining [8] - Industrial Solutions revenue was $6 million, up 29% year-over-year, led by increased gas turbine content [8][29] Market Data and Key Metrics Changes - The company noted stable holding activity in non-wind markets during Q4, with robust activity expected to continue into 2024 [7] - The Gearing segment experienced a significant decline in orders, totaling $3.6 million, down $11.5 million year-over-year, primarily due to reduced oil and gas demand [26] Company Strategy and Development Direction - The company is focused on expanding its product mix within higher-margin adjacent markets, including the release of new products designed for renewable natural gas [3] - Efforts are ongoing to broaden the sales mix into less cyclical markets, aiming for a more balanced revenue profile [39] - The company is pursuing AS9100 quality certification to enhance opportunities in aerospace and defense [3][50] Management's Comments on Operating Environment and Future Outlook - Management indicated that 2024 is expected to be a transitional year for domestic onshore wind developments, with gradual acceleration anticipated in the second half of the year [38] - The company expects first quarter revenue to be in the range of $34 million to $38 million, with adjusted EBITDA between $1 million and $2 million [37] - Management expressed optimism about the long-term economics of wind, particularly with the visibility provided by the Inflation Reduction Act [49] Other Important Information - The company implemented lean operating principles and continuous improvement projects, resulting in self-help savings of approximately $1.5 million in 2023 [4] - The company celebrated 16 years without a lost time incident at its North Carolina facility, reflecting a strong safety performance [5] Q&A Session Summary Question: What is the outlook for Q1 and how does it compare to last year? - Management indicated that earnings are expected to increase throughout the year, with the second half being stronger than the first half due to strong quoting in other businesses [31] Question: What is the expected demand for PRS technology? - Management anticipates PRS becoming a larger part of the overall value mix, with expectations of revenue growth from approximately $10 million in 2023 to closer to $20 million in 2024 [66] Question: What factors are impacting the oil and gas segment? - Management noted that oil and gas demand is expected to remain soft through 2024, with some green shoots of customer orders emerging [94] Question: Are there any delays or cancellations in wind projects? - Management confirmed that while there have been delays, no cancellations have been reported, and customers are still bullish about future demand [85] Question: How is the company addressing supply chain challenges? - Management emphasized the importance of optimizing inventory and cash flow to ensure timely delivery of components, which is critical for maintaining project timelines [115]