Broadwind(BWEN) - 2025 Q2 - Quarterly Results

Q2 2025 Financial and Operational Highlights Broadwind reported a 7.6% year-over-year revenue increase to $39.2 million, driven by growth in the Heavy Fabrications and Industrial Solutions segments, despite swinging to a net loss of ($1.0) million and a decline in adjusted EBITDA to $2.1 million - Revenue growth was primarily driven by increased sales in the wind and industrial verticals, specifically from the Heavy Fabrications and Industrials Solutions segments[4] - Total orders increased by 14% YoY to $21.0 million, boosted by demand from power generation and oil & gas customers, though the consolidated backlog fell 31.5% YoY to $95.3 million[5][8] - The company's net debt to trailing twelve-month Adjusted EBITDA ratio increased to 3.0x from 1.4x in the previous quarter, attributed to higher working capital needs for wind tower production[6] Q2 2025 Financial Summary | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :--- | :--- | :--- | :--- | | Revenue | $39.2 | $36.5 | +7.6% YoY | | Net (Loss)/Income | ($1.0) | $0.5 | - | | Diluted EPS | ($0.04) | $0.02 | - | | Adjusted EBITDA | $2.1 | $3.6 | -41.7% YoY | Management Commentary Management highlighted progress in its diversification strategy, capitalizing on investments in power generation and electrification, with the pending sale of Manitowoc operations optimizing its footprint and strengthening the balance sheet - The company announced the pending sale of its Manitowoc industrial fabrication operations, expected to close in Q3 2025, anticipated to add approximately $13 million in cash and reduce annual costs by an estimated $8 million[7] - Customer demand is strengthening, particularly for natural gas turbine content and oil & gas aftermarket products, with a $6 million follow-on order for gearing products secured in July for early 2026 deliveries[7] - Q2 2025 margins were temporarily compressed due to: - Early production process inefficiencies at Manitowoc and Abilene facilities - Additional overhead to support higher production volumes - Lower capacity utilization in the Gearing segment[7] - Management expressed confidence that its domestic production footprint, expansion into higher-value markets, and strategic actions position the company for sustained profitable growth[9] Segment Performance Analysis Segment performance was mixed in the second quarter, with Heavy Fabrications and Industrial Solutions segments showing revenue growth, while the Gearing segment experienced a sharp decline and operating loss Heavy Fabrications Segment - Revenue growth was driven by an increase in wind tower sections and repowering adapters sold, partially offset by lower demand from the mining end-market[11] Heavy Fabrications Segment Performance | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :--- | :--- | :--- | :--- | | Sales | $25.0 | $19.6 | +27.4% YoY | | Operating Income | $1.7 | $1.6 | +6.3% YoY | | Adjusted EBITDA | $2.8 | $2.8 | Flat YoY | Gearing Segment - The significant decline in sales was primarily driven by lower demand from oil & gas customers[13] Gearing Segment Performance | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :--- | :--- | :--- | :--- | | Sales | $7.3 | $10.5 | -30.3% YoY | | Operating (Loss)/Income | ($0.8) | $0.5 | - | | Adjusted EBITDA | ($0.1) | $1.2 | - | Industrial Solutions Segment - Revenue growth was primarily driven by increased sales of natural gas turbine content, with this segment also setting records for both orders and backlog for the third consecutive quarter[5][15] Industrial Solutions Segment Performance | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :--- | :--- | :--- | :--- | | Sales | $7.4 | $6.5 | +13.9% YoY | | Operating Income | $0.5 | $0.6 | -16.7% YoY | | Adjusted EBITDA | $0.7 | $0.8 | -12.5% YoY | Financial Guidance Broadwind has suspended its previously issued financial guidance for the full year 2025 due to the pending sale of its Manitowoc operations, with updated guidance expected after the transaction closes - The company is suspending its full-year 2025 financial guidance due to the pending sale of its Manitowoc operations, which is expected to close in Q3 2025[16][17] - For the full-year 2024, the Manitowoc operations being sold generated approximately $25 million in revenue with EBITDA margins of 8-9%[17] Consolidated Financial Statements This section provides the unaudited condensed consolidated financial statements for the period ended June 30, 2025, including Balance Sheets, Statements of Operations, and Statements of Cash Flows Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheets (in thousands) | Balance Sheet Item (in thousands) | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash | $1,037 | $7,721 | | Total Current Assets | $78,301 | $66,868 | | Total Assets | $130,511 | $128,290 | | Total Current Liabilities | $51,307 | $43,557 | | Total Liabilities | $71,558 | $68,890 | | Total Stockholders' Equity | $58,953 | $59,400 | Condensed Consolidated Statements of Operations Condensed Consolidated Statements of Operations (in thousands) | Income Statement Item (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenues | $39,235 | $36,452 | | Gross Profit | $3,975 | $5,566 | | Operating (Loss) Income | ($165) | $1,257 | | Net (Loss) Income | ($989) | $482 | | Diluted EPS | ($0.04) | $0.02 | Condensed Consolidated Statements of Cash Flows Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Item (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | ($20,498) | ($3,427) | | Net cash used in investing activities | ($2,115) | ($2,375) | | Net cash provided by financing activities | $15,929 | $5,641 | | Net decrease in cash | ($6,684) | ($161) | | Cash, end of period | $1,037 | $938 | Non-GAAP Financial Measures Reconciliation This section provides a detailed reconciliation of the non-GAAP measure, Adjusted EBITDA, to the most directly comparable GAAP measure, Net (Loss) Income, on both a consolidated and segment basis Consolidated Adjusted EBITDA Reconciliation (in thousands) | Reconciliation Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net (Loss) Income | ($989) | $482 | | Interest Expense | $783 | $726 | | Income Tax Provision | $33 | $53 | | Depreciation and Amortization | $1,643 | $1,718 | | Share-based Compensation | $615 | $663 | | Adjusted EBITDA (Non-GAAP) | $2,085 | $3,642 |