Q1 2022 Earnings Call May 5, 2022 to COMPOSITES。 Decarbonize & Electrify Legal Disclaimer 2 This presentation contains forward-looking statements within the meaning of the federal securities law. All statements other than statements of historical facts contained in this presentation, including statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. In many cases, you can iden ...

TPI Composites, Inc. (NASDAQ:TPIC) Q1 2022 Earnings Conference Call May 5, 2022 5:00 PM ET Company Participants Christian Edin - Senior Director, IR William Siwek - President, CEO & Director Adan Gossar - Interim CFO & CAO Conference Call Participants Laura Sanchez - Morgan Stanley Hilary Cauley - Guggenheim Securities Justin Clare - ROTH Capital Partners Luke Tilkens - Piper Sandler & Co. Aaron Spychalla - Craig-Hallum Thomas Curran - Seaport Research Partners Pavel Molchanov - Raymond James & Associates A ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | --- | --- | --- | | Common Stock, par value $0.01 | TPIC | NASDAQ Global Market | Indicate by check mark wheth ...

PART I [Business](index=5&type=section&id=Item%201.%20Business) TPI Composites is the sole independent global manufacturer of composite wind blades, serving leading OEMs and expanding into transportation composites [Overview](index=5&type=section&id=Overview) TPI Composites is the sole independent global wind blade manufacturer, with **95%** of 2021 net sales from wind and **$2.2 billion** in minimum contract commitments - The company is the **only independent manufacturer** of composite wind blades with a global manufacturing footprint, serving leading wind turbine OEMs[15](index=15&type=chunk) - Wind blade and precision molding systems manufacturing accounted for approximately **95% of total net sales** for the year ended December 31, 2021[18](index=18&type=chunk) - As of February 24, 2022, the company's supply agreements provide for minimum aggregate volume commitments of approximately **$2.2 billion** and a total potential contract value of approximately **$3.5 billion** through the end of 2024[18](index=18&type=chunk) - The company is expanding its transportation business, with orders for approximately **450,000 components in 2022** and **1,000,000 in 2023**[17](index=17&type=chunk) [Business Strategy](index=6&type=section&id=Business%20Strategy) The company's strategy focuses on capitalizing on decarbonization and vehicle electrification, expanding OEM relationships, leveraging global footprint, and driving down LCOE - Capitalize on the long-term global trends of decarbonization of the electric sector and the electrification of vehicles[21](index=21&type=chunk) - Grow existing relationships and develop new ones with leading industry OEMs, who represent a significant portion of the global onshore wind market[21](index=21&type=chunk)[22](index=22&type=chunk) - Leverage its global footprint to capitalize on the continuing outsourcing trend in wind blade manufacturing and evaluate opportunities in the offshore wind market[23](index=23&type=chunk) - Continue to drive down the Levelized Cost of Energy (LCOE) through larger blade models, advanced technology, and collaborative engineering[23](index=23&type=chunk) - Expand the field service inspection and repair business, which is expected to have higher operating margins than the wind blade manufacturing business in the future[23](index=23&type=chunk) [Wind Blade Manufacturing and Supply Agreements](index=8&type=section&id=Wind%20Blade%20Manufacturing%20and%20Supply%20Agreements) TPI has produced over 75,000 wind blades, but faced **$38 million** adverse impact in 2021 from raw material price increases and supply constraints - Key raw materials include fiberglass fabrics, carbon reinforcements, resin, and balsa wood, with significant price increases and supply constraints for resin and carbon fiber, along with increased logistics costs, adversely affecting results of operations by approximately **$38 million** in 2021[26](index=26&type=chunk) - The company's largest customer sources all critical raw materials directly, which limits TPI's control over supply chain risks, leading to production delays in 2021 at facilities in Mexico and Turkey due to customer-sourced material shortages[27](index=27&type=chunk) - Current wind blade customers include Vestas, GE Wind, Nordex, and ENERCON, which collectively represented a significant share of the global onshore wind market[34](index=34&type=chunk) - Supply agreements provide downside protection through minimum annual volume commitments and incentivize higher volumes with better pricing, with raw material price changes typically shared with customers[35](index=35&type=chunk)[36](index=36&type=chunk) [Competition](index=12&type=section&id=Competition) The company faces competition in wind blade manufacturing from independent and in-house OEM producers, and in transportation from conventional and composite material suppliers - Competitors in the wind blade market include LM Wind Power (a subsidiary of GE), other independent manufacturers, and the in-house production of vertically integrated wind turbine OEMs[47](index=47&type=chunk)[48](index=48&type=chunk) - Principal competitive factors in the wind blade market are reliability, total delivered cost, manufacturing capability, product quality, and engineering capability[49](index=49&type=chunk) - In the transportation market, competitors include suppliers of conventional steel and aluminum products and other advanced composites-based manufacturers[57](index=57&type=chunk) [Regulation and Human Capital](index=13&type=section&id=Regulation%20and%20Human%20Capital) Operations are subject to global regulations and government incentives like the U.S. PTC, with over **14,000** employees globally as of December 2021 - The business is affected by government subsidies for wind energy, with the expiration of the U.S. Production Tax Credit (PTC) at the end of 2021 creating near-term uncertainty and decreased demand for wind blades[64](index=64&type=chunk) - Globally, renewable energy is promoted through initiatives like the EU's 2030 greenhouse gas reduction goals and carbon neutrality targets in China (2060) and India (2070)[66](index=66&type=chunk) - As of December 31, 2021, the company employed over **14,000** full-time employees, with the largest concentrations in Mexico (6,300), Turkey (4,100), India (1,600), and China (1,400)[67](index=67&type=chunk) - Certain employees in Turkey and Matamoros, Mexico are represented by labor unions[67](index=67&type=chunk) [Risk Factors](index=18&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from customer concentration, product defects, raw material volatility, U.S. market dependence, international operations, and preferred stockholders' influence [Risks Related to Our Wind Business](index=18&type=section&id=Risks%20Related%20to%20Our%20Wind%20Business) Wind business faces customer concentration (**87.5%** from top 3 in 2021), product defect risks, raw material volatility (**$38 million** impact in 2021), and U.S. market dependence Customer Concentration (as % of Total Net Sales) | Customer | 2021 | 2020 | 2019 | | :--- | :--- | :--- | :--- | | Vestas | 40.4% | 49.7% | 46.1% | | GE Wind | 24.7% | 23.4% | 25.7% | | Nordex | 22.4% | 15.3% | 16.1% | - The company is exposed to significant warranty and product liability claims for defects in materials and workmanship, with warranty periods typically ranging from two to five years[83](index=83&type=chunk)[84](index=84&type=chunk) - Significant price increases and supply constraints for raw materials like resin and carbon fiber, along with logistics cost increases, adversely affected 2021 results by approximately **$38 million**[92](index=92&type=chunk) - The business is heavily dependent on demand for wind energy in the U.S., which is subject to regulatory uncertainty regarding the extension of the Production Tax Credit (PTC)[91](index=91&type=chunk)[108](index=108&type=chunk) [Risks Related to Our Business as a Whole](index=25&type=section&id=Risks%20Related%20to%20Our%20Business%20as%20a%20Whole) Overall business risks include COVID-19 impacts, unpredictable financial results, foreign currency exposure from **90%** international sales, capital needs, and debt covenant compliance - The COVID-19 pandemic adversely affected operations in 2020 and 2021, causing temporary production suspensions and shutdowns[112](index=112&type=chunk)[114](index=114&type=chunk) - Approximately **90%** of net sales for the year ended December 31, 2021, were derived from international operations, exposing the company to foreign currency, legal, and political risks[100](index=100&type=chunk) - The company was not in compliance with certain financial covenants of its senior secured credit facility as of September 30, 2021, and obtained a temporary waiver[123](index=123&type=chunk) - Approximately **48%** of the workforce as of December 31, 2021, is covered by collective bargaining agreements in Turkey and Matamoros, Mexico, which could lead to work disruptions[130](index=130&type=chunk) [Risks Related to Our Series A Preferred Stock and Common Stock](index=30&type=section&id=Risks%20Related%20to%20Our%20Series%20A%20Preferred%20Stock%20and%20Common%20Stock) Issuance of **$350 million** Series A Preferred Stock in 2021 grants Oaktree significant influence and preferential rights, posing dilution and liquidity risks to common stockholders - In November 2021, the company issued 350,000 shares of Series A Preferred Stock for aggregate gross proceeds of **$350.0 million** to Oaktree Capital Management affiliates, who can designate one board member and have consent rights over certain corporate actions[135](index=135&type=chunk)[136](index=136&type=chunk) - The Series A Preferred Stock has rights senior to common stock regarding dividends, liquidation, and redemption, which could adversely affect the company's liquidity and financial condition[139](index=139&type=chunk) - Warrants to purchase **4,666,667 shares** of common stock were issued to the Series A Preferred Stockholders, which could cause dilution upon exercise[145](index=145&type=chunk) [Properties](index=33&type=section&id=Item%202.%20Properties) The company operates its headquarters in Scottsdale, Arizona, with key manufacturing and service facilities globally across the U.S., China, Mexico, Turkey, India, and Europe Key Manufacturing Facilities | Location | Segment | Type | Description | | :--- | :--- | :--- | :--- | | Newton, IA, U.S. | U.S. | Leased | Wind Blade & Transportation Manufacturing | | Yangzhou, China | Asia | Leased | Wind Blade Manufacturing Facility | | Juárez, Mexico | Mexico | Leased | Multiple Wind Blade & Precision Molding Facilities | | Matamoros, Mexico | Mexico | Leased | Wind Blade Manufacturing Facility | | Izmir, Turkey | EMEA | Leased | Two Wind Blade Manufacturing Facilities | | Chennai, India | India | Leased | Wind Blade Manufacturing Facility | PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=35&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on NASDAQ under 'TPIC,' with no history of cash dividends, as earnings are retained for growth, subject to Chinese subsidiary dividend restrictions - The company's common stock began trading on NASDAQ under the symbol "TPIC" on July 22, 2016[160](index=160&type=chunk) - The company has never declared or paid cash dividends on its capital stock and does not anticipate doing so in the future, intending to retain earnings for business growth[165](index=165&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Net sales rose to **$1.73 billion** in 2021, but a net loss of **$159.5 million** resulted from higher costs and restructuring charges, leading to a **$350 million** preferred stock issuance for liquidity [Results of Operations](index=43&type=section&id=Results%20of%20Operations) In 2021, net sales increased to **$1.73 billion**, but a gross loss of **$31.6 million** and a net loss of **$159.5 million** were driven by higher costs and **$23.8 million** in restructuring charges Consolidated Statement of Operations Summary (in thousands) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Net sales | $1,732,583 | $1,670,137 | | Gross profit (loss) | $(31,580) | $64,099 | | Income (loss) from operations | $(97,698) | $18,766 | | Net loss | $(159,548) | $(19,027) | Net Sales by Segment (in thousands) | Segment | 2021 | 2020 | % Change | | :--- | :--- | :--- | :--- | | U.S. | $181,839 | $181,941 | -0.1% | | Asia | $260,197 | $527,083 | -50.6% | | Mexico | $608,098 | $495,839 | 22.6% | | EMEA | $482,220 | $373,545 | 29.1% | | India | $200,229 | $91,729 | 118.3% | - Total cost of goods sold as a percentage of net sales increased to **101.8%** in 2021 from **96.2%** in 2020, driven by higher direct material and labor costs and unfavorable currency fluctuations[217](index=217&type=chunk)[218](index=218&type=chunk) - Restructuring charges increased significantly to **$23.8 million** in 2021 from **$4.1 million** in 2020, primarily due to the closure of facilities in Iowa, Taicang (China), and Dafeng (China)[222](index=222&type=chunk)[223](index=223&type=chunk) [Liquidity and Capital Resources](index=50&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity was impacted in 2021, leading to a **$350 million** preferred stock issuance and debt repayment, resulting in **$242.2 million** cash and **$25.5 million** net cash used in operations - In November 2021, the company issued 350,000 shares of Series A Preferred Stock for aggregate gross proceeds of **$350.0 million** to address near-term liquidity challenges[237](index=237&type=chunk) - **$181.2 million** of the proceeds from the preferred stock issuance was used to repay all outstanding debt under the senior secured credit facility, which was then terminated[237](index=237&type=chunk) Key Liquidity and Cash Flow Metrics (in thousands) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Cash and cash equivalents | $242,165 | $129,857 | | Total debt, net | $74,646 | $216,867 | | Net cash (used in) provided by operating activities | $(25,525) | $37,570 | | Capital expenditures | $37,119 | $65,666 | - Anticipated capital expenditures for fiscal year 2022 are approximately **$30 million**[248](index=248&type=chunk) [Critical Accounting Policies and Estimates](index=53&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Key accounting policies requiring significant management judgment include revenue recognition (cost-to-cost method), income taxes (valuation allowances), and warranty expense estimation - Revenue is primarily recognized over time using a cost-to-cost input measure of progress, which requires significant estimates of total contract costs and variable consideration[257](index=257&type=chunk)[258](index=258&type=chunk) - A full valuation allowance was recorded for all U.S. deferred tax assets in 2021 due to uncertainty about their realizability[263](index=263&type=chunk) - Warranty expense is estimated based on future rates of product failure and repair costs, with the accrued warranty reserve at **$42.0 million** as of December 31, 2021, down from **$50.9 million** in 2020[253](index=253&type=chunk)[265](index=265&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=54&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency (**10%** change impacting **$33.2 million** income), commodity prices (**10%** resin change impacting **$12.4 million** income), and has mitigated interest rate risk with fixed-rate debt - The company is exposed to foreign currency transaction and translation risk, where a hypothetical **10%** change in exchange rates would have impacted income from operations by approximately **$33.2 million** for the year ended December 31, 2021[270](index=270&type=chunk) - The company is subject to commodity price risk for raw materials, especially resin, where a **10%** change in the price of resin would have impacted income from operations by approximately **$12.4 million** for the year ended December 31, 2021, before customer cost-sharing[272](index=272&type=chunk) - As of December 31, 2021, all outstanding debt and finance lease obligations are fixed-rate instruments, mitigating interest rate risk[273](index=273&type=chunk) [Financial Statements and Supplementary Data](index=55&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for fiscal year 2021, including balance sheets, income statements, cash flows, and accompanying notes and audit report Consolidated Balance Sheet Summary (in thousands) | | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Total Current Assets | $660,271 | $548,159 | | Total Assets | $1,007,701 | $956,257 | | Total Current Liabilities | $469,110 | $406,108 | | Total Liabilities | $634,775 | $755,222 | | Mezzanine Equity | $250,974 | $0 | | Total Stockholders' Equity | $121,952 | $201,035 | Consolidated Statement of Cash Flows Summary (in thousands) | | 2021 | 2020 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(25,525) | $37,570 | | Net cash used in investing activities | $(37,119) | $(65,666) | | Net cash provided by financing activities | $198,919 | $88,612 | | Net change in cash | $122,022 | $58,447 | [Controls and Procedures](index=55&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2021, a conclusion affirmed by KPMG LLP's audit report - The Chief Executive Officer and Interim Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of December 31, 2021[276](index=276&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2021[278](index=278&type=chunk) PART III [Directors, Executive Officers, Corporate Governance, Compensation, and Security Ownership](index=57&type=section&id=Item%2010%2C%2011%2C%2012%2C%2013%2C%2014) Information for Items 10-14, including directors, executive compensation, and security ownership, is incorporated by reference from the company's 2022 Annual Meeting proxy statement - The information required by Items 10, 11, 12, 13, and 14 is incorporated by reference from the company's definitive proxy statement for the 2022 Annual Meeting of Stockholders[284](index=284&type=chunk)[285](index=285&type=chunk)[286](index=286&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=58&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section provides a list of financial statements and an index of all exhibits filed with the Annual Report on Form 10-K, including corporate governance and material contracts - This item contains the financial statements and an index of all exhibits filed with the Annual Report on Form 10-K[290](index=290&type=chunk)[291](index=291&type=chunk)

TOT COMPOSITES。 Q4 2021 Earnings Call February 24, 2022 Legal Disclaimer This presentation contains forward-looking statements within the meaning of the federal securities law. All statements other than statements of historical facts contained in this presentation, including statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. In many cases, you can identify forward-lookin ...

Financial Data and Key Metrics Changes - For the full year 2021, the company reported net sales of $1.7 billion, a 3.7% increase from 2020, and adjusted EBITDA of $2.3 million, despite adverse impacts of approximately $52 million and $40 million in revenue due to contract extensions and cost estimates under ASC 606 [7][36][38] - In Q4 2021, net sales were $389.5 million, with wind blade sales at $362.3 million, primarily affected by production declines and raw material shortages [31][33] - The net loss attributable to common stockholders for the year was $165.3 million, compared to $19.0 million in 2020, driven by raw material inflation and other operational challenges [35] Business Line Data and Key Metrics Changes - Wind blade sales for the full year totaled $1.61 billion, driven by increased average sales prices, although production volumes decreased [34] - The transportation segment saw significant growth, with the company winning its first major program commitment for an electric vehicle platform [13][90] - The global service organization expanded to nearly 400 technicians, achieving over two times revenue growth compared to 2020 [11] Market Data and Key Metrics Changes - The company experienced challenges in the U.S. market due to stalled legislative initiatives and supply chain constraints, which decreased demand for wind blades in 2021 compared to 2020 [25][26] - The European market remains significant, with approximately 30% of blades built being shipped there, although permitting and citing challenges persist [99] Company Strategy and Development Direction - The company aims to capitalize on long-term growth in the wind market by expanding global service offerings and enhancing logistics and recycling capabilities [28] - Focus remains on localizing and regionalizing the supply chain to mitigate high logistics costs and ensure supply security [24] - The company is positioned to grow market share with leading OEMs as demand for wind energy is expected to strengthen [26] Management's Comments on Operating Environment and Future Outlook - Management highlighted ongoing market volatility and uncertainty, particularly in the U.S., affecting sales expectations for 2022 [45] - The company anticipates continued margin compression due to rising costs and competitive pressures, despite efforts to stabilize material costs [47] - Future growth is expected in the transportation segment, with a projected increase in service business revenue [90] Other Important Information - The company closed a $400 million financing deal to strengthen its balance sheet, with an additional $200 million available for future growth opportunities [15][39] - The company ended 2021 with $242.2 million in unrestricted cash and no net debt [39] Q&A Session Summary Question: Guidance on sales expectations for 2022 - Management indicated that current market volatility suggests net sales could be flat to slightly down, consistent with previous guidance [45] Question: Visibility on margin expansion - Management expects margins to remain compressed in 2022 due to ongoing cost pressures [47] Question: Thoughts on balance sheet and additional capital - The company is comfortable with the current capital raised and views the additional $200 million as a resource for future growth opportunities [48] Question: Update on transportation segment growth - Management expects significant growth in the transportation segment, projecting a 1.5 times increase in revenue compared to the previous year [90] Question: Progress on supply chain localization - Management reported substantial progress in localizing supply chains in Mexico and India, with expectations for continued improvement in 2022 [65] Question: Revenue contribution from European markets - Approximately 30% of the company's blades are shipped to Europe, with Turkey contributing less than 10% of its production [97] Question: Future outlook for the wind market - Management believes that demand for wind energy will strengthen, driven by the need for decarbonization and supportive policies [26]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 001-37839 TPI Composites, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Delaware 20-1590775 (I.R ...

COMPOSITES。 Q3 2021 Earnings Call November 8, 2021 Legal Disclaimer 2 This presentation contains forward-looking statements within the meaning of the federal securities law. All statements other than statements of historical facts contained in this presentation, including statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. In many cases, you can identify forward-looking s ...

TPI Composites, Inc. (NASDAQ:TPIC) Q3 2021 Earnings Conference Call November 8, 2021 5:00 PM ET Company Participants Bill Siwek – President and CEO Christian Edin – Investor Relations Bryan Schumaker – CFO Conference Call Participants Philip Shen – Roth Capital Partners James West – Evercore ISI Adhak Belekar – Bank of America Eric Stine – Craig-Hallum Laura Sanchez – Morgan Stanley Stephen Gengaro – Stifel Pearce Hammond – Piper Sandler Pavel Molchanov – Raymond James Mark Strouse – JPMorgan Greg Rostkowsk ...

TPI Composites, Inc. (NASDAQ:TPIC) Q2 2021 Earnings Conference Call August 5, 2021 5:00 PM ET Company Participants Christian Edin - Senior Director, Investor Relations William Siwek - President & Chief Executive Officer Bryan Schumaker - Chief Financial Officer Conference Call Participants Laura Sanchez - Morgan Stanley Donovan Schafer - ROTH Capital Partners Eric Stine - Craig-Hallum Capital Group Stephen Gengaro - Stifel Tom Curran - Seaport Research Partners Pavel Molchanov - Raymond James Operator Good ...