BABCOCK & WILCOX ENTERPRISES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amount) September 30, 2017 December 31, 2016
Cash and cash equivalents $ 48,137
$ 95,887
Restricted cash and cash equivalents 26,648
27,770
Accounts receivable – trade, net 320,202
282,347
Accounts receivable – other 67,421
73,756
Contracts in progress 169,182
166,010
Inventories 91,099
85,807
Other current assets 37,339
45,957
Total current assets 760,028
777,534
Net property, plant and equipment 143,107
133,637
Goodwill 204,105
267,395
Deferred income taxes 163,013
163,388
Investments in unconsolidated affiliates 87,417
98,682
Intangible assets 80,000
71,039
Other assets 22,227
17,468
Total assets $ 1,459,897
$ 1,529,143

Foreign revolving credit facilities $ 12,398
$ 14,241
Accounts payable 243,565
220,737
Accrued employee benefits 38,009
35,497
Advance billings on contracts 219,822
210,642
Accrued warranty expense 41,230
40,467
Other accrued liabilities 92,491
95,954
Total current liabilities 647,515
617,538
United States revolving credit facility 58,900
9,800
Second lien term loan facility 138,384
—
Pension and other accumulated postretirement benefit liabilities 275,269
301,259
Other noncurrent liabilities 45,046
39,595
Total liabilities 1,165,114
968,192
Commitments and contingencies
Stockholders' equity:
Common stock, par value $0.01 per share, authorized 200,000 shares; issued and outstanding 44,049 and 48,688 shares at September 30, 2017 and December 31, 2016, respectively 499
544
Capital in excess of par value 800,183
806,589
Treasury stock at cost, 5,681 and 5,592 shares at September 30, 2017 and
December 31, 2016, respectively
(104,745 ) (103,818 )
Retained deficit (387,030 ) (114,684 )
Accumulated other comprehensive loss (22,440 ) (36,482 )
Stockholders' equity attributable to shareholders 286,467
552,149
Noncontrolling interest 8,316
8,802
Total stockholders' equity 294,783
560,951
Total liabilities and stockholders' equity $ 1,459,897
$ 1,529,143


(in thousands, except per share amount)	March 31, 2024		December 31, 2023
Cash and cash equivalents	$	43,881	$	65,304
Current restricted cash and cash equivalents	16,935		5,737
Accounts receivable – trade, net	124,398		144,016
Accounts receivable – other	29,930		36,179
Contracts in progress	107,431		90,054
Inventories, net	112,407		113,890
Other current assets	22,975		23,918
Current assets held for sale	24,266		18,495
Total current assets	482,223		497,593
Net property, plant and equipment and finance leases	78,514		78,369
Goodwill	100,655		101,956
Intangible assets, net	42,816		45,627
Right-of-use assets	28,641		28,192
Long-term restricted cash	41,636		297
Deferred tax assets	2,094		2,105
Other assets	18,944		21,559

Total assets	$	795,523	$	775,698

Accounts payable	$	129,535	$	127,491
Accrued employee benefits	11,246		10,797
Advance billings on contracts	74,861		81,098
Accrued warranty expense	7,160		7,634
Financing lease liabilities	1,400		1,367
Operating lease liabilities	3,804		3,932
Other accrued liabilities	65,268		68,090
Loans payable	4,473		6,174
Current liabilities held for sale	35,179		43,614
Total current liabilities	332,926		350,197
Senior notes	338,388		337,869
Loans payable, net of current portion	98,727		35,442


Pension and other postretirement benefit liabilities	172,174		172,911
Finance lease liabilities, net of current portion	25,839		26,206
Operating lease liabilities, net of current portion	25,990		25,350
Deferred tax liability	12,991		12,991
Other non-current liabilities	10,955		15,082

Total liabilities	1,017,990		976,048

Stockholders' deficit:
Preferred stock, par value $0.01 per share, authorized shares of 20,000; issued and outstanding shares of 7,669 at March 31, 2024 and December 31, 2023	77		77
Common stock, par value $0.01 per share, authorized shares of 500,000; outstanding shares of 89,480 and 89,449 at March 31, 2024 and December 31, 2023, respectively	5,149		5,148
Capital in excess of par value	1,547,671		1,546,281
Treasury stock at cost, 2,139 shares at March 31, 2024 and December 31, 2023	(115,164)		(115,164)
Accumulated deficit	(1,591,489)		(1,570,942)
Accumulated other comprehensive loss	(69,255)		(66,361)
Stockholders' deficit attributable to shareholders	(223,011)		(200,961)
Non-controlling interest	544		611
Total stockholders' deficit	(222,467)		(200,350)
Total liabilities and stockholders' deficit	$	795,523	$	775,698

See accompanying notes to ~~condensed consolidated financial statements.~~

Condensed Consolidated Financial Statements.

BABCOCK & WILCOX ENTERPRISES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT


	Common Stock			Preferred Stock			Capital In Excess of Par Value		Treasury Stock		Accumulated Deficit		Accumulated Other Comprehensive (Loss)		Non-controlling Interest		Total Stockholders’ Equity (Deficit)
(in thousands)	Shares	Par Value		Shares	Par Value
Balance at December 31, 2023	89,449	$	5,148	7,669	$	77	$	1,546,281	$	(115,164)	$	(1,570,942)	$	(66,361)	$	611	$	(200,350)
Net loss	—			—	—		—		—		(16,833)		—		42		(16,791)
Currency translation adjustments	—	—		—	—		—		—		—		(3,125)		(109)		(3,234)
Pension and post retirement adjustments, net of tax	—	—		—	—		—		—		—		231		—		231
Stock-based compensation charges	31	1		—	—		1,390		—		—		—		—		1,391
Dividends to preferred shareholders	—	—		—	—		—		—		(3,714)		—		—		(3,714)



Balance at March 31, 2024	89,480	$	5,149	7,669	$	77	$	1,547,671	$	(115,164)	$	(1,591,489)	$	(69,255)	$	544	$	(222,467)


	Common Stock			Preferred Stock			Capital In Excess of Par Value		Treasury Stock		Accumulated Deficit		Accumulated Other Comprehensive (Loss)		Non-controlling Interest		Total Stockholders’ (Deficit) Equity
(in thousands)	Shares	Par Value		Shares	Par Value
Balance at December 31, 2022	88,700	$	5,138	7,669	$	77	$	1,537,625	$	(113,753)	$	(1,358,875)	$	(72,786)	$	485	$	(2,089)
Net loss	—	—		—	—		—		—		(12,496)		—		21		(12,475)
Currency translation adjustments	—	—		—	—		—		—		—		4,592		(35)		4,557

Pension and post retirement adjustments, net of tax	—	—		—	—		—		—		—		223		—		223
Stock-based compensation charges	45	1		—	—		3,357		(64)		—		—		—		3,294
Dividends to preferred stockholders	—	—		—	—		—		—		(3,715)		—		—		(3,715)



Dividends to non-controlling interest	—	—		—	—		—		—		—		—		(1)		(1)
Balance at March 31, 2023	88,745	$	5,139	7,669	$	77	$	1,540,982	$	(113,817)	$	(1,375,086)	$	(67,971)	$	470	$	(10,206)

See accompanying notes to Condensed Consolidated Financial Statements.

~~Table of Contents~~

BABCOCK & WILCOX ENTERPRISES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Three Months Ended March 31,
(in thousands)	2024		2023
Cash flows from operating activities:


Net loss from continuing operations	(15,799)		(12,686)
Net (loss) income from discontinued operations	(992)		211
Net loss	$	(16,791)	$	(12,475)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization of long-lived assets	4,843		5,365


Amortization of deferred financing costs and debt discount	740		1,388
Amortization of guaranty fee	608		231
Non-cash operating lease expense	1,804		566

Loss on debt extinguishment	5,071		—
Loss on asset disposals	81		941
Provision for (benefit from) deferred income taxes	2,514		(1,870)
Prior service cost amortization for pension and postretirement plans	231		223
Stock-based compensation	1,391		3,357

Foreign exchange	1,333		461
Changes in operating assets and liabilities:
Accounts receivable - trade, net and other	17,997		(5,522)
Contracts in progress	(21,515)		(29,042)
Advance billings on contracts	(6,350)		3,581
Inventories, net	3,100		(7,594)
Income taxes	2,889		2,055
Accounts payable	(1,758)		29,639
Accrued and other current liabilities	(8,351)		2,682
Accrued contract loss	(2,784)		(665)
Pension liabilities, accrued postretirement benefits and employee benefits	176		(4,328)
Other, net	(167)		(1,874)
Net cash used in operating activities:	(14,938)		(12,881)
Cash flows from investing activities:
Purchase of property, plant and equipment	(3,394)		(2,208)


Purchases of available-for-sale securities	(1,624)		(2,021)
Sales and maturities of available-for-sale securities	2,147		2,072
Other, net	22		—
Net cash used in investing activities	(2,849)		(2,157)

Nine months ended September 30,
(in thousands) 2017 2016
Cash flows from operating activities:
Net income (loss) $ (271,780 ) $ (43,796 )
Non-cash items included in net income (loss):
Depreciation and amortization of long-lived assets 31,037
27,413
Amortization of debt issuance costs and debt discount 3,190
—
Income of equity method investees (4,813 ) (4,887 )
Goodwill impairment charges 86,903
—
Other than temporary impairment of equity method investment in TBWES 18,193
—
Losses on asset disposals and impairments, net 543
14,906
Provision for (benefit from) deferred income taxes (2,100 ) (7,613 )
Recognition of losses (gains) for pension and postretirement plans (1,219 ) 30,646
Stock-based compensation, net of associated income taxes 8,523
13,899
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable 1,375
49,082
Accrued insurance receivable —
(15,000 )
Contracts in progress and advance billings on contracts 6,682
(53,983 )
Inventories 2,717
(7,990 )
Income taxes 9,196
6,296
Accounts payable 5,514
(32,390 )
Accrued and other current liabilities (16,011 ) (3,733 )
Pension liabilities, accrued postretirement benefits and employee benefits (27,960 ) (21,206 )
Other, net (781 ) 8,601
Net cash from operating activities (150,791 ) (39,755 )
Cash flows from investing activities:
Decrease in restricted cash and cash equivalents (2,934 ) 8,270
Investment in equity method investees —
(26,220 )
Purchase of property, plant and equipment (10,666 ) (20,376 )
Acquisition of business, net of cash acquired (52,547 ) (142,980 )
Purchases of available-for-sale securities (22,900 ) (30,738 )
Sales and maturities of available-for-sale securities 31,077
20,986
Other 61
(556 )
Net cash from investing activities (57,909 ) (191,614 )
Cash flows from financing activities:
Borrowings under our United States revolving credit facility 511,423
75,465
Repayments of our United States revolving credit facility (462,323 ) (42,248 )
Proceeds from our second lien term loan facility, net of $34.2 million discount 141,674
—
Repayments of our foreign revolving credit facilities (3,313 ) (18,289 )
Common stock repurchase from related party (16,674 ) —
Shares of our common stock returned to treasury stock (927 ) (78,391 )
Debt issuance costs (14,025 ) —
Other (298 ) (1,166 )
Net cash from financing activities 155,537
(64,629 )
Effects of exchange rate changes on cash 5,413
(4,126 )
Net increase (decrease) in cash and equivalents (47,750 ) (300,124 )
Cash and equivalents, beginning of period 95,887
365,192
Cash and equivalents, end of period $ 48,137
$ 65,068


	Three Months Ended March 31,
(in thousands)	2024		2023
Cash flows from financing activities:
Issuance of senior notes	—		8
Borrowings on loan payable	90,352		—
Repayments on loan payable	(28,802)		(1,658)
Payment of holdback funds from acquisition	(2,950)		—






Finance lease payments	(332)		(286)
Payment of preferred stock dividends	(3,714)		(3,715)
Shares of common stock returned to treasury stock	—		(64)



Debt issuance costs	(3,146)		(139)
Other, net	(111)		—
Net cash provided by (used in) financing activities	51,297		(5,854)
Effects of exchange rate changes on cash	(2,427)		(1,500)
Net increase (decrease) in cash, cash equivalents and restricted cash	31,083		(22,392)
Cash, cash equivalents and restricted cash at beginning of period	71,369		113,460
Cash, cash equivalents and restricted cash at end of period	$	102,452	$	91,068

Schedule of cash, cash equivalents and restricted cash:
Cash and cash equivalents	$	43,881	$	62,760
Current restricted cash	16,935		6,911
Long-term restricted cash	41,636		21,397
Total cash, cash equivalents and restricted cash at end of period(1)	$	102,452	$	91,068

Supplemental cash flow information:
Income taxes paid, net	$	2,318	$	1,551
Interest paid	$	7,089	$	6,382

(1) Includes cash held at discontinued operations of $— million and $0.03 million at March 31, 2024 and 2023, respectively.

See accompanying notes to ~~condensed consolidated financial statements.~~

Condensed Consolidated Financial Statements.

~~Table of Contents~~

BABCOCK & WILCOX ENTERPRISES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~SEPTEMBER 30, 2017~~MARCH 31, 2024

NOTE 1 – BASIS OF PRESENTATION

These interim ~~financial statements~~Condensed Consolidated Financial Statements of Babcock & Wilcox Enterprises, Inc. ("(“B&W,~~" "we," "us," "our"~~” “management,” “we,” “us,” “our” or ~~"the Company"~~the “Company”) have been prepared in accordance with ~~accounting principles generally accepted in the United States~~GAAP and ~~Securities and Exchange Commission~~SEC instructions for interim financial information, and should be read in conjunction with ~~our~~the Annual Report on Form 10-K for the year ended December 31, ~~2016 (“Annual Report”). Accordingly, significant accounting policies and other disclosures normally provided have been omitted since such items~~2023. The Notes to Condensed Consolidated Financial Statements are disclosed in our Annual Report. We have included all adjustments, in the opinion of management, consisting only of normal, recurring adjustments, necessary for a fair presentation of the interim financial statements. We have eliminated all intercompany transactions and accounts. We present the notes to our condensed consolidated financial statementspresented on the basis of continuing operations, unless otherwise stated.

The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from these estimates. In the opinion of management, these Condensed Consolidated Financial Statements contain all estimates and adjustments, consisting of normal recurring adjustments, required to fairly present the financial position, results of operations, and cash flows for the periods presented. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full-year ending December 31, 2024.

There have been no material changes to our significant accounting policies included in the Annual Report on Form 10-K for the year ended December 31, 2023.

Non-controlling interests are presented in the Condensed Consolidated Financial Statements as if parent company investors (controlling interests) and other minority investors (non-controlling interests) in partially-owned subsidiaries have similar economic interests in a single entity. As a result, investments in non-controlling interests are reported as equity in the Condensed Consolidated Financial Statements. Additionally, the Condensed Consolidated Financial Statements include 100% of a controlled subsidiary’s earnings, rather than only our share. Transactions between the parent company and non-controlling interests are reported in equity as transactions between stockholders, provided that these transactions do not create a change in control.

Liquidity and Going Concern

The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with GAAP applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

In response to the conditions, we are implementing several strategies to obtain the required funding for future operations and are considering other alternative measures to improve cash flow, including suspension of the dividend on our Preferred Stock. The following actions occurred during the three months ended March 31, 2024:

•entered into advanced negotiations related to the sale of one of our non-strategic businesses. Proceeds from the sale are expected to be approximately $40.0 million to $46.0 million, subject to due diligence and continuing negotiations. We cannot provide any assurances that such transaction will close or that proceeds will not be more or less than we anticipate;

•initiated the process to sell certain of our other non-strategic businesses;

•filed for a waiver of required minimum contributions to the Retirement Plan for Employees of Babcock & Wilcox Commercial Operations (the "U.S. Plan"), that if granted, would reduce cash funding requirements in 2024 and would increase contributions annually over the subsequent five-year period. We cannot provide any assurances that such waiver will be granted;

•initiated the process to sell several non-core real estate assets;

•initiated the sale of common shares pursuant to our At-The-Market Offering; and

•negotiated the settlement of a liability to the former owner of B&W Solar at a discount, resulting in future cash savings of $7.2 million.

Based on our ability to raise funds through the actions noted above and our Cash and cash equivalents as of March 31, 2024, we have concluded it is probable that such actions would provide sufficient liquidity to fund operations for the next twelve months following the date of this Quarterly Report. As a result, it is probable that our cash flow improvement plans and anticipated proceeds from the sale of non-strategic assets alleviate the substantial doubt about our ability to continue as a going concern.

Operations

Our operations are assessed based on three reportable market-facing segments consistent with our strategic initiative to accelerate growth and provide stakeholders improved visibility into our renewable and environmental growth platforms. Our reportable segments are as follows:

•Babcock & Wilcox Renewable: Technologies for efficient and environmentally sustainable power and heat generation, including waste-to-energy, biomass-to-energy and black liquor systems for the pulp and paper industry. Our technologies support a circular economy, diverting waste from landfills to use for power generation and replacing fossil fuels, while recovering metals and reducing emissions.

•Babcock & Wilcox Environmental: A full suite of emissions control and environmental technology solutions for utility, waste-to-energy, biomass-to-energy, carbon black, and industrial steam generation applications around the world. Our broad experience includes systems for cooling, ash handling, particulate control, nitrogen oxides and sulfur dioxides removal, chemical looping for carbon control, and mercury control.

•Babcock & Wilcox Thermal: Steam generation equipment, aftermarket parts, construction, maintenance and field services for plants in the power generation, oil and gas, and industrial sectors. We have an extensive global base of installed equipment for utilities and general industrial applications including refining, petrochemical, food processing, metals and others.

For financial information about our segments see Note 4 to the Condensed Consolidated Financial Statements.

NOTE 2 – ~~EARNINGS~~LOSS PER SHARE

The following table sets forth the computation of basic and diluted ~~earnings~~loss per share of our common stock, net of non-controlling interest and dividends on preferred stock:

Three months ended September 30, Nine months ended September 30,
(in thousands, except per share amounts) 2017 2016 2017 2016
Net income (loss) attributable to shareholders $ (114,302 ) $ 8,894
$ (272,346 ) $ (44,089 )

Weighted average shares used to calculate basic earnings per share 46,149
49,621
47,905
50,613
Dilutive effect of stock options, restricted stock and performance shares —
236
—
—
Weighted average shares used to calculate diluted earnings per share 46,149
49,857
47,905
50,613

Basic income (loss) per share: $ (2.48 ) $ 0.18
$ (5.69 ) $ (0.87 )

Diluted income (loss) per share: $ (2.48 ) $ 0.18
$ (5.69 ) $ (0.87 )


	Three Months Ended March 31,
(in thousands, except per share amounts)	2024		2023
Loss from continuing operations	$	(15,799)	$	(12,686)
Net loss attributable to non-controlling interest	(42)		(21)
Less: Dividend on Series A preferred stock	3,714		3,715
Loss from continuing operations attributable to stockholders of common stock	(19,555)		(16,422)
(Loss) income from discontinued operations, net of tax	(992)		211
Net loss attributable to stockholders of common stock	$	(20,547)	$	(16,211)



Weighted average shares used to calculate basic and diluted loss per share	89,479		88,733

Basic and diluted loss per share:
Continuing operations	$	(0.22)	$	(0.18)
Discontinued operations	(0.01)		$	—
Basic and diluted loss per share	$	(0.23)	$	(0.18)

~~Because~~Basic and diluted weighted average shares are the same because we incurred a net loss in the ~~quarter and nine~~three months ended ~~September 30, 2017~~ March 31, 2024 and 2023.

For the ~~nine~~three months ended ~~September 30, 2016, basic and diluted shares are the same.~~

March 31, 2024 if we had net income, we would have had no additional dilutive shares. If we had net income infor the ~~nine~~three months ended ~~September 30, 2017 and 2016, diluted shares~~March 31, 2023 we would ~~include an additional~~have included 0.4 million ~~and 0.5 million shares, respectively. If we had net income~~ in ~~the quarter ended September 30, 2017,~~ diluted ~~shares would include an additional 0.5 million~~ shares.

We would have excluded ~~2.0~~2.4 million and ~~0.6~~2.2 million shares related to stock options from the diluted share calculation for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2024 and ~~2016,~~2023, respectively, ~~because~~because their effect would have been anti-dilutive. ~~For~~

NOTE 3 - ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

During the third quarter ~~ended~~of 2023, we committed to a plan to sell our B&W Solar business resulting in a significant change that would impact our operations. As of September 30, ~~2017,~~2023, we ~~excluded 2.3 million shares~~met all of the criteria for the assets and liabilities of this business, formerly part of our B&W Renewable segment, to be accounted for as held for sale. In addition, we also determined that the operations of the B&W Solar business qualified as a discontinued operation, primarily based upon its significance to our current and historic operating losses.

We continued to meet the criteria to account for the B&W Solar business as held for sale and discontinued operations as of March 31, 2024.

The following table summarizes the operating results of the disposal group included in discontinued operations in the Condensed Consolidated Statements of Operations:


	Three Months Ended March 31,
(in thousands)	2024		2023
Revenues	$	11,373	$	15,989

Cost of operations	10,366		14,442
Selling general and administrative expenses	1,699		1,468
Restructuring expenses	35		—



Total costs and expenses	12,100		15,910
Operating (loss) income	(727)		79




Other (expense) income	(265)		132

(Loss) income from discontinued operations	(992)		211


(Loss) income from discontinued operations, net of tax	$	(992)	$	211

The following table provides the major classes of assets and liabilities of the disposal group included in assets held for sale and liabilities held for sale in the Condensed Consolidated Balance Sheets:


(in thousands)	March 31, 2024		December 31, 2023
Cash	$	—	$	31
Contracts in progress	5,957		4,538

Accounts receivable - trade	7,558		3,272

Other assets, net	67		62


Total current assets	13,582		7,903

Net property, plant and equipment and finance leases	2,780		2,683
Intangible assets, net	7,833		7,833


Right-of-use assets	71		76

Total non-current assets	10,684		10,592
Total assets of disposal group	$	24,266	$	18,495

Loans payable, current	$	489	$	502
Operating lease liabilities, current	24		23
Accounts payable	20,976		26,298
Accrued employee benefits	284		231
Advance billings on contracts	5,452		5,961
Accrued warranty expense	1,067		1,078
Other current liabilities	4,420		8,101
Total current liabilities	32,712		42,194

Loans payable, net of current portion	1,296		1,308

Other non-current liabilities	1,171		112
Total non-current liabilities	2,467		1,420
Total liabilities of disposal group	$	35,179	$	43,614

Reported as:
Current assets of discontinued operations	$	24,266	$	18,495



Current liabilities of discontinued operations	$	35,179	$	43,614

The significant components included in the Condensed Consolidated Statements of Cash Flows for the discontinued operations are as follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Depreciation and amortization of long-lived assets	$	—	$	96




Changes in operating assets and liabilities:
Accounts receivable	(4,286)		(4,515)
Contracts in progress	(1,419)		(3,473)
Accounts payable	(5,322)		7,452


Purchase of property, plant and equipment	(127)		(15)

Contracts

During the three months ended March 31, 2024, seven contracts were terminated, resulting in gross profit of $1.2 million. There were no new loss contracts during the three months ended March 31, 2024. During the three months ended March 31, 2023, one B&W Solar project became a loss contract, and the related loss was immaterial to the condensed consolidated financial statements.

Changes in Contract Estimates

During the three months ended March 31, 2024 and 2023 B&W Solar recognized changes in estimated gross profit related to ~~stock options because their effect would have been anti-dilutive.~~long-term contracts accounted for on the over time basis, which are summarized below:


	Three Months Ended March 31,
(in thousands)	2024		2023
Increases in gross profit for changes in estimates (1)	$	2,212	$	824
Decreases in gross profit for changes in estimates	(147)		(1,510)
Net changes in gross profit for changes in estimates	$	2,065	$	(686)

(1) Includes the $1.2 million contract termination benefit noted above.

Backlog

B&W Solar backlog was $72.4 million and $99.0 million at March 31, 2024 and December 31, 2023, respectively. The decrease was primarily driven by contract terminations of $17.0 million and revenue recognized of $11.4 million, partially offset by new bookings during the quarter. We expect to recognize substantially all of the remaining performance obligations as revenue during the year ended December 31, 2024.

NOTE 34 – SEGMENT REPORTING

~~Our~~We assess our operations ~~are assessed~~ based on three reportable segments ~~which are summarized~~as described in Note 1 to the Condensed Consolidated Financial Statements. An analysis of our operations by segment is as follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Revenues:
B&W Renewable segment
B&W Renewable	$	29,590	$	49,132
B&W Renewable Services	18,461		16,310
Vølund	4,230		18,681

	52,281		84,123
B&W Environmental segment
B&W Environmental	26,708		20,361
SPIG	18,561		16,605
GMAB	3,085		2,474
	48,354		39,440
B&W Thermal segment
B&W Thermal	110,187		119,236
	110,187		119,236

Eliminations	(3,266)		(1,541)
Total Revenues	$	207,556	$	241,258

At a segment level, the adjusted EBITDA presented below is consistent with the manner in which our chief operating decision maker ("CODM") reviews the results of operations and makes strategic decisions about the business and is calculated as earnings before interest, tax, depreciation and amortization adjusted for items such as gains or losses arising from the sale of non-income producing assets, net pension benefits, restructuring activities, impairments, gains and losses on debt extinguishment, legal and settlement costs, costs related to financial consulting, research and development costs, product development costs, costs and operating income from contracts being terminated, and other costs that may not be directly controllable by segment management and are not allocated to the segment. The following table is provided to reconcile our segment performance metrics to loss before income tax expense.

~~Power~~


	Three Months Ended March 31,
(in thousands)	2024		2023(1)

B&W Renewable segment adjusted EBITDA	$	1,658	$	4,322
B&W Environmental segment adjusted EBITDA	3,326		1,906
B&W Thermal segment adjusted EBITDA	13,672		13,733
Corporate	(6,005)		(5,080)
R&D expenses	(116)		(1,307)
Interest expense	(12,527)		(12,543)
Depreciation & amortization	(4,409)		(5,269)
Benefit plans, net	96		(109)
Loss on sales, net	(53)		(937)
Settlements and related legal costs, net	4,087		2,463

Loss on debt extinguishment	(5,071)		—
Stock compensation	(1,350)		(3,227)
Restructuring expense and business services transition	(1,580)		(960)
Acquisition pursuit and related costs	(84)		(134)
Product development	(1,619)		(1,370)
Foreign exchange	(1,333)		(461)
Financial advisory services	(214)		—
Contract disposal	(585)		(1,387)
Letter of credit fees	(2,388)		(1,643)
Other- net	(11)		(193)
Loss before income tax expense	(14,506)		(12,196)

(1) Certain 2023 amounts have been reclassified in the reconciliation to conform to the 2024 presentation.

We do not separately identify or report assets by segment: ~~focused on~~ as our CODM does not consider assets by segment to be a critical measure by which performance is measured.

NOTE 5 – REVENUE RECOGNITION AND CONTRACTS

Revenue Recognition

We generate the vast majority of our revenues from the supply of, and aftermarket services for, steam-generating, environmental and auxiliary ~~equipment for power generation and other industrial applications.~~

~~Renewable segment~~: ~~focused on~~equipment. We also earn revenue from the supply of ~~steam-generating~~custom-engineered cooling systems ~~environmental~~for steam applications and ~~auxiliary equipment~~related aftermarket services.

A performance obligation is a contractual promise to transfer a distinct product or service to the customer. A contract's transaction price is allocated to each distinct performance obligation and is recognized as revenue when (point in time) or as (over time) the performance obligation is satisfied.

Revenue from products and services transferred to customers at a point in time, which includes certain aftermarket parts and services, accounted for 22% and 17% of revenue for the ~~waste-to-energy~~three months ended March 31, 2024 and ~~biomass power generation industries.~~2023, respectively. Revenue from products and services transferred to customers over time, which primarily relates to customized, engineered solutions and construction services, accounted for 78% and 83% of revenue for the three months ended March 31, 2024 and 2023, respectively.

Refer to Note 4 to the Condensed Consolidated Financial Statements for further disaggregation of revenue.

~~Industrial segment~~: ~~focused on custom-engineered cooling, environmental and other industrial equipment along with related aftermarket services.~~

~~Table~~

Contract Balances

The following represents the components of ~~Contents~~

~~An analysis of our operations by segment is as follows:~~

Three months ended September 30, Nine months ended
September 30,
(in thousands) 2017 2016 2017 2016
Revenues:
Power segment $ 202,222
$ 211,749
$ 612,274
$ 762,293
Renewable segment 108,557
124,344
262,168
293,593
Industrial segment 99,288
76,809
281,734
147,275
Eliminations (1,364 ) (1,947 ) (6,540 ) (4,882 )
408,703
410,955
1,149,636
1,198,279
Gross profit:
Power segment 40,629
48,896
132,653
170,903
Renewable segment 181
18,592
(100,119 ) 14,468
Industrial segment 9,461
14,601
34,240
33,506
Intangible amortization expense included in cost of operations (2,984 ) (7,752 ) (11,455 ) (8,833 )
Mark to market loss included in cost of operations —
(580 ) (954 ) (30,079 )
47,287
73,757
54,365
179,965
Selling, general and administrative ("SG&A") expenses (59,225 ) (59,615 ) (192,742 ) (179,225 )
Goodwill impairment charges (86,903 ) —
(86,903 ) —
Restructuring activities and spin-off transaction costs (3,775 ) (2,395 ) (8,910 ) (38,021 )
Research and development costs (2,291 ) (2,361 ) (7,454 ) (8,273 )
Intangible amortization expense included in SG&A (1,016 ) (1,018 ) (2,999 ) (3,071 )
Mark to market loss included in SG&A —
(64 ) (106 ) (465 )
Equity in income of investees 1,234
2,827
4,813
4,887
Impairment of equity method investment —
—
(18,193 ) —
Gains (losses) on asset disposals, net (59 ) 2
(63 ) 17
Operating income (loss) $ (104,748 ) $ 11,133
$ (258,192 ) $ (44,186 )

~~During~~ the ~~first half of 2017, we announced our plan to reclassify the Industrial Steam product line currently included~~Contracts in our Power segment to the Industrial segment beginning with the quarter ended September 30, 2017. We have indefinitely postponed that reorganization. As of September 30, 2017, the Industrial Steam product line remains in the Power segment for all periods presented.

~~NOTE 4 – UNIVERSAL ACQUISITION~~

On January 11, 2017, we acquired Universal Acoustic & Emission Technologies, Inc. ("Universal") for approximately $52.5 million in cash, funded primarily by borrowings under our United States revolving credit facility, net of $4.4 million cash acquired in the business combination. Transaction costsprogress and Advance billings on contracts included in the ~~purchase price were~~Condensed Consolidated Balance Sheets:


(in thousands)	March 31, 2024		December 31, 2023		$ Change		% Change
Contract assets - included in contracts in progress:
Costs incurred less costs of revenue recognized	$	47,431	$	37,556	$	9,875	26	%
Revenues recognized less billings to customers	60,000		52,498		7,502		14	%
Contracts in progress	$	107,431	$	90,054	$	17,377	19	%
Contract liabilities - included in advance billings on contracts:
Billings to customers less revenues recognized	$	68,393	$	76,032	$	(7,639)	(10)	%
Costs of revenue recognized less cost incurred	6,468		5,066		1,402		28	%
Advance billings on contracts	$	74,861	$	81,098	$	(6,237)	(8)	%

Net contract balance	$	32,570	$	8,956	$	23,614	264	%

Accrued contract losses	$	363	$	522	$	(159)	(30)	%

Backlog

At March 31, 2024 we had $650.4 million of remaining performance obligations, which we also refer to as total backlog. We expect to recognize approximately ~~$0.2 million. We accounted for the Universal acquisition using the acquisition method, whereby all~~64%, 17% and 19% of the ~~assets acquired~~remaining performance obligations as revenue in 2024, 2025 and ~~liabilities assumed were recognized at their fair value on the acquisition date, with any excess~~thereafter, respectively.

Changes in Contract Estimates

During each of the purchase price over the estimated fair value recorded as goodwill. In order to purchase Universal on January 11, 2017, we borrowed approximately $55.0 million under the United States revolving credit facility in 2017.

Universal provides custom-engineered acoustic, emission and filtration solutions to the natural gas power generation, mid-stream natural gas pipeline, locomotive and general industrial end-markets. Universal's product offering includes gas turbine inlet and exhaust systems, silencers, filters and enclosures. At the acquisition date, Universal employed approximately 460 people, mainly in the United States and Mexico. During 2017, we integrated Universal with our Industrial segment. Universal contributed $16.0 million and $49.8 million of revenue to our operating results during the three ~~and nine~~ months ended ~~September 30, 2017, respectively. Universal contributed $3.2 million~~March 31, 2024 and ~~$10.0 million of gross profit (excluding intangible asset amortization expense of $0.5 million and $2.6 million) to our operating results in the three and nine months ended~~

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~~September 30, 2017, respectively. We expect Universal to contribute over $70.0 million of revenue and be accretive to the Industrial segment's gross profit during 2017.~~

The allocation of the purchase price based on the estimated fair value of assets acquired and liabilities assumed is set forth below. We are in the process of finalizing the purchase price allocation associated with the valuation of certain intangible assets and deferred tax balances; as a result, the provisional measurements of intangible assets, goodwill and deferred income tax balances are subject to change. Purchase price adjustments are expected to be finalized by December 31, 2017.

(in thousands)
Estimated acquisition
date fair value
Cash $ 4,379
Accounts receivable 11,270
Contracts in progress 3,167
Inventories 4,585
Other assets 579
Property, plant and equipment 16,692
Goodwill 14,413
Identifiable intangible assets 19,500
Deferred income tax assets 935
Current liabilities (10,833 )
Other noncurrent liabilities (1,423 )
Deferred income tax liabilities (6,338 )
Net acquisition cost $ 56,926

~~The intangible assets included above consist of the following:~~

Estimated
fair value (in thousands)

Weighted average
estimated useful life
(in years)
Customer relationships $ 10,800
15
Backlog 1,700
1
Trade names / trademarks 3,000
20
Technology 4,000
7
Total amortizable intangible assets $ 19,500

The acquisition of Universal resulted in an increase in our intangible asset amortization expense during the three and nine months ended September 30, 2017 of $0.5 million and $2.6 million, respectively, which is included in cost of operations in our condensed consolidated statement of operations. Amortization of intangible assets is not allocated to segment results.

Approximately $0.1 million and $1.5 million of acquisition and integration related costs of Universal was recorded as a component of our operating expenses in the condensed consolidated statement of operations in the three and nine months ended ~~September 30, 2017, respectively.~~

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The following unaudited pro forma financial information below represents our results of operations for the three and nine months ended September 30, 2016 and 12 months ended December 31, 2016 had the Universal acquisition occurred on January 1, 2016. The unaudited pro forma financial information below is not intended to represent or be indicative of our actual consolidated results had we completed the acquisition at January 1, 2016. This information should not be taken as representative of our future consolidated results of operations.

Three months ended Nine months ended Twelve months ended
(in thousands) September 30, 2016 September 30, 2016 December 31, 2016
Revenues $ 431,412
$ 1,259,905
$ 1,660,986
Net income (loss) attributable to B&W 8,903
(43,458 ) (113,940 )
Basic earnings per common share 0.18
(0.86 ) (2.27 )
Diluted earnings per common share 0.18
(0.86 ) (2.27 )

~~The unaudited pro forma results included in the table above reflect the following pre-tax adjustments to our historical results:~~

A net increase in amortization expense related to timing of amortization of the fair value of identifiable intangible assets acquired of $0.5 million, $2.4 million and $2.8 million in the three and nine months ended September 30, 2016 and the 12 months ended December 31, 2016, respectively.

~~Elimination of the historical interest expense recognized by Universal of $0.1 million, $0.3 million and $0.4 million in the three and nine months ended September 30, 2016 and the 12 months ended~~ ~~December 31, 2016, respectively.~~

~~Elimination of $2.1 million in transaction related costs recognized in the 12 months ended~~ ~~December 31, 2016~~.

~~NOTE 5 – CONTRACTS AND REVENUE RECOGNITION~~

We generally recognize revenues and related costs from long-term contracts on a percentage-of-completion basis. Accordingly, we review contract price and cost estimates regularly as work progresses and reflect adjustments in profit proportionate to the percentage of completion in the periods in which we revise estimates to complete the contract. To the extent that these adjustments result in a reduction of previously reported profits from a project, we recognize a charge against current earnings. If a contract is estimated to result in a loss, that loss is recognized in the current period as a charge to earnings and the full loss is accrued on our balance sheet, which results in no expected gross profit from the loss contract in the future unless there are revisions to our estimated revenues or costs at completion in periods following the accrual of the contract loss. Changes in the estimated results of our percentage-of-completion contracts are necessarily based on information available at the time that the estimates are made and are based on judgments that are inherently uncertain as they are predictive in nature. As with all estimates to complete used to measure contract revenue and costs, actual results can and do differ from our estimates made over time.

~~In the three and nine months ended September 30, 2017 and 2016,~~2023, we recognized changes in estimated gross profit related to long-term contracts accounted for on the ~~percentage-of-completion~~over time basis, which are summarized as follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Increases in gross profit for changes in estimates for over time contracts	$	6,964	$	5,401
Decreases in gross profit for changes in estimates for over time contracts	(3,891)		(4,243)
Net changes in gross profit for changes in estimates for over time contracts	$	3,073	$	1,158

Three months ended September 30, Nine months ended September 30,
(in thousands) 2017 2016 2017 2016
Increases in estimates for percentage-of-completion contracts $ 3,040
$ 7,996
$ 15,777
$ 33,056
Decreases in estimates for percentage-of-completion contracts (12,312 ) (22,126 ) (135,445 ) (65,805 )
Net changes in estimates for percentage-of-completion contracts $ (9,272 ) $ (14,130 ) $ (119,668 ) $ (32,749 )

As disclosed in our December 31, 2016 consolidated financial statements, we had four renewable energy projects in Europe that were loss contracts at December 31, 2016. During the three months ended June 30, 2017, two additional renewable energy projects in Europe became loss contracts. During the three and nine months ended September 30, 2017, we recorded a total of $11.6 million and $123.8 million, respectively, in net losses resulting from changes in the estimated revenues and costs to complete these six European renewable energy loss contracts. These changes in estimates include an increase in our estimate of liquidated damages associated with these six projects of $13.2 million and $22.6 million in the three and nine months ended September 30, 2017, respectively, to a total of $62.8 million at September 30, 2017. The charges recorded in the nine months

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ended September 30, 2017 were due to revisions in the estimated revenues and costs at completion during the period, primarily as a result of structural steel design issues including the anticipated schedule impact, scheduling delays and shortcomings in our subcontractors' estimated productivity. Also included in the charges recorded in the nine months ended September 30, 2017 were corrections that reduced (increased) estimated contract losses at completion by $1.0 million, $(6.0) million and $1.1 million relating to the three months ended December 31, 2016, March 31, 2017 and June 30, 2017, respectively. Management has determined these amounts are immaterial to the consolidated financial statements in these previous periods. As of September 30, 2017, the status of these six loss contracts was as follows:

The first project became a loss contract in the second quarter of 2016. As of September 30, 2017, this project is approximately 97% complete and construction activities are complete as of the date of this report. The unit became operational during the second quarter of 2017, and turnover activities linked to the customer's operation of the facility are expected to be completed during the first quarter of 2018. During the three and nine months ended September 30, 2017, we recognized additional contract losses of $4.6 million and $15.1 million, respectively, on the project as a result of differences in actual and estimated costs and schedule delays. Our estimate at completion as of September 30, 2017 includes $9.4 million of total expected liquidated damages. As of September 30, 2017, the reserve for estimated contract losses recorded in "other accrued liabilities" in our consolidated balance sheet was $2.3 million. In the three and nine months ended September 30, 2016, we recognized charges of $14.0 million and $45.7 million, respectively, and as of September 30, 2016, this project had $7.8 million of accrued losses and was 79% complete.

The second project became a loss contract in the fourth quarter of 2016. As of September 30, 2017, this contract was approximately 75% complete, and we expect this project to be completed in early 2018. During the three and nine months ended September 30, 2017, we recognized contract gains of $2.0 million and contract losses of $35.4 million, respectively, on this project as a result of changes in construction cost estimates and schedule delays. Our estimate at completion as of September 30, 2017 includes $15.5 million of total expected liquidated damages. As of September 30, 2017, the reserve for estimated contract losses recorded in "other accrued liabilities" in our consolidated balance sheet was $13.6 million.

The third project became a loss contract in the fourth quarter of 2016. As of September 30, 2017, this contract was approximately 95% complete and construction activities are complete as of the date of this report. The unit became operational during the second quarter of 2017, and turnover activities linked to the customer's operation of the facility are expected to be completed during the fourth quarter of 2017. During the three and nine months ended September 30, 2017, we recognized additional contract losses of $1.6 million and $7.1 million, respectively, as a result of changes in the estimated costs at completion. Our estimate at completion as of September 30, 2017 includes $6.7 million of total expected liquidated damages for schedule delays. As of September 30, 2017, the reserve for estimated contract losses recorded in "other accrued liabilities" in our consolidated balance sheet was $1.7 million.

The fourth project became a loss contract in the fourth quarter of 2016. As of September 30, 2017, this contract was approximately 77% complete, and we expect this project to be completed in early 2018. During the three and nine months ended September 30, 2017, we revised our estimated revenue and costs at completion for this loss contract, which resulted in contract gains of $4.5 million and contract losses of $17.4 million, respectively. Our estimate at completion as of September 30, 2017 includes $8.9 million of total expected liquidated damages due to schedule delays. The changes in the status of this project were primarily attributable to changes in the estimated costs at completion, offset by a $4.8 million reduction in estimated liquidated damages we recognized during the three months ended March 31, 2017. As of September 30, 2017, the reserve for estimated contract losses recorded in "other accrued liabilities" in our consolidated balance sheet was $5.2 million.

The fifth project became a loss contract in the second quarter of 2017. As of September 30, 2017, this contract was approximately 60% complete, and we expect this project to be completed in the second half of 2018. During the three and nine months ended September 30, 2017, we revised our estimated revenue and costs at completion for this loss contract, which resulted in additional contract losses of $12.0 million and $35.3 million, respectively. Our estimate at completion as of September 30, 2017 includes $17.9 million of total expected liquidated damages due to schedule delays. The change in the status of this project was primarily attributable to changes in the estimated costs at completion and schedule delays. As of September 30, 2017, the reserve for estimated contract losses recorded in "other accrued liabilities" in our consolidated balance sheet was $14.3 million.

The sixth project became a loss contract in the second quarter of 2017. As of September 30, 2017, this contract was approximately 68% complete, and we expect this project to be completed in the first half of 2018. During the nine months ended September 30, 2017, we revised our estimated revenue and costs at completion for this loss contract, which resulted in additional contract losses of $18.5 million. We had no significant change in estimate on this loss contract during the

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three months ended September 30, 2017. Our estimate at completion as of September 30, 2017 includes $4.3 million of total expected liquidated damages due to schedule delays. The change in the status of this project was primarily attributable to changes in the estimated costs at completion and schedule delays. As of September 30, 2017, the reserve for estimated contract losses recorded in "other accrued liabilities" in our consolidated balance sheet was $3.3 million.

In September 2017, we identified the failure of a structural steel beam on the fifth project, which temporarily stopped work in the boiler building pending corrective actions to stabilize the structure that are expected to be complete in the fourth quarter of 2017. The engineering, design and manufacturing of the steel structure were the responsibility of our subcontractors. A similar design was also used on the second and fourth projects, and although no structural failure occurred on these two other projects, work was also stopped for a short period of time, and reinforcement of the structure is underway. The costs related to these structural steel issues are estimated to be approximately $20 million, which include the impact of project delays, and is included in the September 30, 2017 estimated losses at completion for these three projects as disclosed in the preceding paragraphs.

Also in the three months ended September 30, 2017, we adjusted the design of three of these renewable facilities to increase the guaranteed power output, which will allow us to achieve contractual bonus opportunities for the higher output. The bonus opportunities increased the estimated selling price of the three contracts by approximately $15 million in total, and this positive change in estimated cost to complete was fully recognized in the third quarter of 2017 because each of these three were loss projects.

During the three and nine months ended September 30, 2017, we recognized a net loss of $2.3 million on our other renewable energy projects that are not loss contracts, and we expect them to remain profitable at completion.

During the third quarter of 2016, we determined it was probable that we would receive a $15.0 million insurance recovery for a portion of the losses on the first European renewable energy project discussed above. There was no change in the accrued probable insurance recovery at September 30, 2017. The insurance recovery represents the full amount available under the insurance policy, and is recorded in accounts receivable - other in our condensed consolidated balance sheet at September 30, 2017.

NOTE 6 – ~~RESTRUCTURING ACTIVITIES AND SPIN-OFF TRANSACTION COSTS~~

~~Restructuring liabilities~~

~~Restructuring liabilities are included in other accrued liabilities on our condensed consolidated balance sheets. Activity related to the restructuring liabilities is as follows:~~INVENTORIES

Three months ended September 30, Nine months ended September 30,
(in thousands) 2017 2016 2017 2016
Balance at beginning of period⁽¹⁾
$ 967
$ 11,984
$ 2,254
$ 740
Restructuring expense 3,428
1,792
7,285
19,816
Payments (2,399 ) (10,422 ) (7,543 ) (17,202 )
Balance at September 30 $ 1,996
$ 3,354
$ 1,996
$ 3,354

⁽¹⁾~~For the three month periods ended September 30, 2017 and 2016, the balance~~Inventories are stated at the ~~beginning~~lower of the period is as of June 30, 2017 and 2016, respectively. For the nine month periods ended September 30, 2017 and 2016, the balance at the beginning of the period is as of December 31, 2016 and 2015, respectively.

~~Accrued restructuring liabilities at September 30, 2017 and 2016 relate primarily to employee termination benefits.~~

Excluded from restructuring expense in the table above are non-cash restructuring charges that did not impact the accrued restructuring liability. In the three and nine months ended September 30, 2017, we recognized $0.2 million and $0.6 million, respectively, in non-cash restructuring expense related to losses (gains) on the disposals of long-lived assets. In the three and nine months ended September 30, 2016, we recognized non-cash charges of $0.2 million and $14.8 million, respectively, related to impairments of long-lived assets.

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~~Spin-off transaction costs~~

Spin-off costs were primarily attributable to employee retention awards directly related to the spin-off from our former parent, The Babcock & Wilcox Company (now known as BWX Technologies, Inc.). In the three and nine months ended September 30, 2017, we recognized spin-off costs of $0.2 million and $1.0 million, respectively. In the three and nine months ended September 30, 2016, we recognized spin-off costs of $0.4 million and $3.4 million, respectively. In the nine months ended September 30, 2017, we disbursed $1.9 million of the accrued retention awards.

~~NOTE 7 – PROVISION FOR INCOME TAXES~~

We had an income tax benefit of $5.6 million in the three months ended September 30, 2017, which resulted in a 4.7% effective tax rate as compared to $1.6 million of income tax expense in the three months ended September 30, 2016, which resulted in a 15.2% effective tax rate. Our effective tax rate for the three months ended September 30, 2017 was lower than our statutory rate primarily due to nondeductible goodwill impairment charges, foreign losses in our Renewable segment that are subject to a valuation allowance and nondeductible expenses, offset by favorable discrete items of $0.4 million. The discrete items include favorable adjustments to prior year U.S. tax returns and the effect of vested and exercised share-based compensation awards. Our effective tax rate for the three months ended September 30, 2016 was lower than our statutory rate primarily due to changes in the jurisdictional mix of our forecasted full year income and losses and favorable impacts from adjustments related to prior years' tax returns in the United States and foreign jurisdictions.

We had an income tax benefit of $7.6 million in the nine months ended September 30, 2017, which resulted in a 2.7% effective tax rate as compared to an income tax benefit of $0.8 million in the nine months ended September 30, 2016, which resulted in a 1.8% effective tax rate for the nine months ended September 30, 2016. Our effective tax rate for the nine months ended September 30, 2017 was lower than our statutory rate primarily due to the reasons noted above, as well as the second quarter tax benefit associated with the impairment of our equity method investment in India, which was offset by a valuation allowance, second quarter discrete items including withholding tax on a forecasted distribution outside the United States, partly offset by first quarter favorable discrete adjustments to prior year foreign tax returns and nondeductible transaction costs. Our effective tax rate for the nine months ended September 30, 2016 was lower than our statutory rate primarily due to a $13.1 million increase in valuation allowances associated with deferred tax assets related to our equity investment in a foreign joint venture and statecost or net ~~operating losses, and to the jurisdictional mix of our forecasted full year income and losses, as described above.~~

~~During the nine months ended September 30, 2017, we prospectively adopted Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2016-09,~~ ~~Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-based Payment Accounting~~. Adopting the new accounting standard resulted in a net $0.2 million and $1.7 million income tax benefit in the three and nine months ended September 30, 2017, respectively, associated with the income tax effects of vested and exercised share-based compensation awards.

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~~NOTE 8 – COMPREHENSIVE INCOME~~

Gains and losses deferred in accumulated other comprehensive income (loss) ("AOCI") are reclassified and recognized in the condensed consolidated statements of operations once they are realized. The changes in the components of AOCI, net of tax, for the first three quarters in 2017 and 2016 were as follows:

(in thousands) Currency translation gain (loss) (net of tax) Net unrealized gain (loss) on investments (net of tax) Net unrealized gain (loss) on derivative instruments (net of tax) Net unrecognized gain (loss) related to benefit plans (net of tax) Total
Balance at December 31, 2016 $ (43,987 ) $ (37 ) $ 802
$ 6,740
$ (36,482 )
Other comprehensive income (loss) before reclassifications 5,417
61
4,587
(44 ) 10,021
Amounts reclassified from AOCI to net income (loss) —
(27 ) (3,843 ) (882 ) (4,752 )
Net current-period other comprehensive income (loss) 5,417
34
744
(926 ) 5,269
Balance at March 31, 2017 $ (38,570 ) $ (3 ) $ 1,546
$ 5,814
$ (31,213 )
Other comprehensive income (loss) before reclassifications 6,757
(19 ) (2,204 ) (97 ) 4,437
Amounts reclassified from AOCI to net income (loss) —
(1 ) (658 ) (800 ) (1,459 )
Net current-period other comprehensive income (loss) 6,757
(20 ) (2,862 ) (897 ) 2,978
Balance at June 30, 2017 (31,813 ) (23 ) (1,316 ) 4,917
(28,235 )
Other comprehensive income (loss) before reclassifications 2,591
69
268
(66 ) 2,862
Amounts reclassified from AOCI to net income (loss) —
(4 ) 3,567
(630 ) 2,933
Net current-period other comprehensive income (loss) 2,591
65
3,835
(696 ) 5,795
Balance at September 30, 2017 $ (29,222 ) $ 42
$ 2,519
$ 4,221
$ (22,440 )

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(in thousands) Currency translation gain (loss) (net of tax) Net unrealized gain (loss) on investments (net of tax) Net unrealized gain (loss) on derivative instruments (net of tax) Net unrecognized gain (loss) related to benefit plans (net of tax) Total
Balance at December 31, 2015 $ (19,493 ) $ (44 ) $ 1,786
$ (1,102 ) $ (18,853 )
Other comprehensive income (loss) before reclassifications 1,740
18
2,576
(61 ) 4,273
Amounts reclassified from AOCI to net income (loss) —
1
(1,003 ) 61
(941 )
Net current-period other comprehensive income 1,740
19
1,573
—
3,332
Balance at March 31, 2016 $ (17,753 ) $ (25 ) $ 3,359
$ (1,102 ) $ (15,521 )
Other comprehensive income (loss) before reclassifications (11,566 ) (7 ) 778
37
(10,758 )
Amounts reclassified from AOCI to net income (loss) —
—
(651 ) 58
(593 )
Net current-period other comprehensive income (loss) (11,566 ) (7 ) 127
95
(11,351 )
Balance at June 30, 2016 (29,319 ) (32 ) 3,486
(1,007 ) (26,872 )
Other comprehensive income (loss) before reclassifications 2,811
18
1,132
(25 ) 3,936
Amounts reclassified from AOCI to net income (loss) —
—
(1,247 ) 8
(1,239 )
Net current-period other comprehensive income (loss) 2,811
18
(115 ) (17 ) 2,697
Balance at September 30, 2016 $ (26,508 ) $ (14 ) $ 3,371
$ (1,024 ) $ (24,175 )

~~The amounts reclassified out of AOCI by component and the affected condensed consolidated statements of operations line items are as follows (in thousands):~~

AOCI component Line items in the Condensed Consolidated Statements of Operations affected by reclassifications from AOCI Three months ended September 30, Nine months ended September 30,
2017 2016 2017 2016
Derivative financial instruments Revenues $ 2,092
$ 1,940
$ 8,094
$ 4,524
Cost of operations 159
24
113
57
Other-net (7,930 ) (445 ) (7,438 ) (1,065 )
Total before tax (5,679 ) 1,519
769
3,516
Provision for income taxes (2,112 ) 272
(165 ) 615
Net income $ (3,567 ) $ 1,247
$ 934
$ 2,901

Amortization of prior service cost on benefit obligations Cost of operations $ 619
$ (15 ) $ 2,281
$ 294
Provision for income taxes (11 ) (7 ) (31 ) 421
Net income (loss) $ 630
$ (8 ) $ 2,312
$ (127 )

Realized gain on investments Other-net $ 6
$ —
$ 50
$ (1 )
Provision for income taxes 2
—
18
—
Net income (loss) $ 4
$ —
$ 32
$ (1 )

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~~NOTE 9 – CASH AND CASH EQUIVALENTS~~

~~The components of cash and cash equivalents are as follows:~~

(in thousands) September 30, 2017 December 31, 2016
Held by foreign entities $ 44,778
$ 94,415
Held by United States entities 3,359
1,472
Cash and cash equivalents $ 48,137
$ 95,887

Reinsurance reserve requirements $ 21,456
$ 21,189
Restricted foreign accounts 5,192
6,581
Restricted cash and cash equivalents $ 26,648
$ 27,770

Our United States revolving credit facility described in Note 17 allows for nearly immediate borrowing of available capacity to fund cash requirements in the normal course of business, meaning that the minimum United States cash on hand is maintained to minimize borrowing costs.

~~NOTE 10 – INVENTORIES~~

realizable value. The components of inventories are as follows:


(in thousands)	March 31, 2024		December 31, 2023
Raw materials and supplies	$	91,394	$	90,116
Work in progress	4,834		6,604
Finished goods	16,179		17,170
Total inventories	$	112,407	$	113,890

(in thousands) September 30, 2017 December 31, 2016
Raw materials and supplies $ 66,995
$ 61,630
Work in progress 9,518
6,803
Finished goods 14,586
17,374
Total inventories $ 91,099
$ 85,807

NOTE 117 – ~~EQUITY METHOD INVESTMENTS~~PROPERTY, PLANT & EQUIPMENT & FINANCE LEASES

~~Joint ventures~~Property, plant and equipment less accumulated depreciation is as follows:


(in thousands)	March 31, 2024		December 31, 2023
Land	$	2,579	$	2,608
Buildings	34,577		34,832
Machinery and equipment	152,858		152,700
Property under construction	16,097		13,780
	206,111		203,920
Less accumulated depreciation	149,452		147,929
Net property, plant and equipment	56,659		55,991
Finance leases	30,653		30,656
Less finance lease accumulated amortization	8,798		8,278
Net property, plant and equipment, and finance leases	$	78,514	$	78,369

NOTE 8 - GOODWILL

Goodwill represents the excess of the consideration transferred over the fair value of net assets, including identifiable intangible assets, at the acquisition date. Goodwill is assessed for impairment annually on October 1 or more frequently if events or changes in ~~which we have significant ownership and influence, but not control, are accounted~~circumstances indicate a potential impairment exists.

There were no indicators of goodwill impairment identified for ~~in our consolidated financial statements using~~ the ~~equity method of accounting. We assess our investments in unconsolidated affiliates for other-than-temporary-impairment when significant~~quarter ended March 31, 2024.

The following summarizes the changes ~~occur~~ in the investee's business or our investment philosophy. Such changes might include a series of operating losses incurred by the investee that are deemed other than temporary, the inability of the investee to sustain an earnings capacity that would justify thenet carrying amount of the investment or a change in the strategic reasons that were important when we originally entered into the joint venture. If an other-than-temporary-impairment were to occur, we would measure our investment in the unconsolidated affiliate at fair value.goodwill as of March 31, 2024:


(in thousands)	B&W Renewable		B&W Environmental		B&W Thermal		Total


Balance at December 31, 2023	$	25,805	$	5,637	$	70,514	$	101,956







Currency translation adjustments	(262)		(236)		(803)		(1,301)
Balance at March 31, 2024	$	25,543	$	5,401	$	69,711	$	100,655

Our primary equity method investees include joint ventures in China and India, each of which manufactures boiler parts and equipment. At September 30, 2017 and December 31, 2016, our total investment in these joint ventures was $87.4 million and $98.7 million, respectively.

During the third quarter of 2017, both we and our joint venture partner began the process of scaling back the operations at Thermax Babcock & Wilcox Energy Solutions Private Limited ("TBWES"), our joint venture in India, due to the decline in forecasted market opportunities in India. Currently, the manufacturing facility in India has been reduced to essential personnel only while engineering services are expected to continue in our engineering office through the end of 2017. These actions are in line with our change in strategy for the joint venture announced in the second quarter of 2017, which reduced the expected recoverable value of our investment in TBWES. We recognized an $18.2 million other-than-temporary-impairment of our investment in TBWES during the nine months ended September 30, 2017. The impairment charge was based on the difference in the carrying value of our investment in TBWES and our share of the estimated fair value of TBWES's net assets.

NOTE 1310 – ~~GOODWILL~~

~~The following summarizes the changes in the carrying amount of goodwill:~~

(in thousands) Power Renewable Industrial Total
Balance at December 31, 2016 $ 46,220
$ 48,435
$ 172,740
$ 267,395
Increase resulting from Universal acquisition —
—
14,413
14,413
Third quarter 2017 impairment charges^*
—
(49,965 ) (36,938 ) (86,903 )
Currency translation adjustments 1,180
1,530
6,490
9,200
Balance at September 30, 2017 $ 47,400
$ —
$ 156,705
$ 204,105

^* ~~Prior to September 30, 2017, we had not recorded any goodwill impairment charges.~~

Our annual goodwill impairment assessment is performed on October 1 of each year (the "annual assessment" date); however, events during 2017 have required two interim assessments of all six of our reporting units. In the second quarter of 2017, significant charges in our Renewable segment was considered to be a triggering event for the interim assessment as of June 30, 2017, which did not indicate impairment. In the third quarter of 2017, our market capitalization significantly decreased to below our equity value, which was considered to be a trigger for a second interim assessment. Additionally, the forecast was reduced for our SPIG reporting unit based on a change in the market strategy implemented by the new segment management to focus on core geographies and products.

Assessing goodwill for impairment involves a two step test. Step 1 of the test compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step of the test is performed to measure the amount of the impairment loss, if any. Step 2 of the test compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill, and impairment is measured as the excess of the carrying value over the implied value of goodwill. Estimating the fair value of a reporting unit requires significant judgment. The fair value of each reporting unit determined under Step 1 of the goodwill impairment test was based on a 50% weighting of an income approach using a discounted cash flow analysis based on forward-looking projections of future operating results, a 30% to 40% weighting of a market approach using multiples of revenue and earnings before interest, taxes, depreciation and amortization ("EBITDA") of guideline companies and a 20% to 10% weighting of a market approach using multiples of revenue and EBITDA from recent, similar business combinations.

We primarily attributed the significant decline in our market capitalization in the third quarter of 2017 to the announcement of significant charges in the Renewable reporting unit. Accordingly, we increased the discount rate applied to future projected cash flows from 15.0% at June 30, 2017 to 23.5% at September 30, 2017. As a result of the increase in the discount rate and an increase in the carrying value of the reporting unit, impairment was indicated at September 30, 2017, which measured $50.0 million ($48.9 million net of tax), the full carrying value. Other long-lived assets in the reporting unit were not impaired.

For our SPIG reporting unit, which is included in our Industrial segment, the Step 1 also indicated impairment. At June 30, 2017 and October 1, 2016, the fair value exceeded the carrying value by less than 1% and 5%, respectively. At September 30, 2017, the independently obtained fair value estimates decreased under both the income and market valuation approaches due

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to a short-term decrease in profitability attributable to specific current contracts and changes in SPIG's market strategy introduced by segment management during the third quarter. The discount rate applied to future projected cash flows was 14.0% and 12.5% at each of the September 30, 2017 and June 30, 2017 interim tests, respectively. Step 2 of the impairment test at September 30, 2017 measured $36.9 million of impairment (with no income tax impact). The SPIG reporting unit has $38.0 million of goodwill remaining after the impairment charge. Other long-lived assets in the reporting unit were not impaired.

For the remaining four reporting units where impairment was not indicated at September 30, 2017, the goodwill balances at September 30, 2017 and the Step 1 goodwill impairment test headroom (the estimated fair value less the carrying value) are as follows:

Power Segment Industrial Segment
(in millions) Power Construction MEGTEC Universal
Reporting unit headroom 60% 98% 12% 18%
Goodwill balance $38.5 $8.9 $104.3 $14.4

Step 1 of the impairment test for our MEGTEC reporting unit, which is included in our Industrial segment, did not indicate impairment, and the fair value exceeded the carrying value by 12% at September 30, 2017 compared to 3.0% at June 30, 2017 and 22% at October 1, 2016. Under both the income and market valuation approaches, the fair value estimates at the interim assessment data and the second interim assessment date decreased compared to the annual assessment date due to lower projected net sales and EBITDA. Similar to many industrial businesses, the reduction in MEGTEC reporting unit revenues has been the result of a decline in new equipment demand, primarily in the Americas; however, bookings trends have recently improved and backlog at September 30, 2017 is 67% higher than at the same date a year ago. The MEGTEC reporting unit recorded a 15% increase in revenues and a 16% increase in gross profit during the third quarter of 2017. The estimate of fair value of the MEGTEC reporting unit is sensitive to changes in assumptions, particularly assumed discount rates and projections of future operating results under the income approach. The discount rate applied to future projected cash flows was 12.5% and 11.0% at each of the September 30, 2017 and June 30, 2017 interim tests, respectively. Absent any other changes, an increase in the discount rate could result in future impairment of goodwill. Decreases in future projected operating results could also result in future impairment of goodwill.

~~NOTE 14 – PROPERTY, PLANT & EQUIPMENT~~

~~Property, plant and equipment is stated at cost. The composition of our property, plant and equipment less accumulated depreciation is set forth below:~~

(in thousands) September 30, 2017 December 31, 2016
Land $ 8,802
$ 6,348
Buildings 121,952
114,322
Machinery and equipment 206,437
189,489
Property under construction 14,218
22,378
351,409
332,537
Less accumulated depreciation 208,302
198,900
Net property, plant and equipment $ 143,107
$ 133,637

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~~NOTE 15 –~~ACCRUED WARRANTY EXPENSE

We may offer assurance type warranties on products and services sold to customers. Changes in the carrying amount of ~~our~~ accrued warranty expense are as follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Balance at beginning of period	$	7,634	$	9,568
Additions	515		1,901
Expirations and other changes	(392)		(1,358)
Payments	(460)		(253)
Translation and other	(137)		52
Balance at end of period	$	7,160	$	9,910

We record estimated expense included in Cost of operations on the Condensed Consolidated Statements of Operations to satisfy contractual warranty requirements when we recognize the associated revenues on the related contracts, or in the case of a loss contract, the full amount of the estimated warranty cost is accrued when the contract becomes a loss contract.In addition, we record specific adjustments when we expect the actual warranty costs to significantly differ from the estimates. Such changes could have a material effect on our financial position, results of operations and cash flows.

Nine months ended September 30,
(in thousands) 2017 2016
Balance at beginning of period $ 40,467
$ 39,847
Additions 17,818
18,300
Expirations and other changes (9,053 ) (2,945 )
Increases attributable to business combinations 1,060
901
Payments (11,126 ) (10,922 )
Translation and other 2,064
(217 )
Balance at end of period $ 41,230
$ 44,964
NOTE 11 – RESTRUCTURING ACTIVITIES

~~During~~We incurred restructuring charges (benefits) in each of the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2024 and ~~2016,~~2023. The charges (benefits) primarily consist of legal fees and costs related to actions taken as part of our ~~Power segment reduced its~~ongoing strategic, market-focused organizational and re-branding initiative.

The following table summarizes the restructuring activity incurred by segment:


	Three Months Ended March 31,						Three Months Ended March 31,
	2024						2023
(in thousands)	Total		Severance and related costs		Other (1)		Total		Severance and related costs (benefit)		Other(1)
B&W Renewable	$	834	$	159	$	675	$	(89)	$	(89)	$	—
B&W Environmental	185		59		126		20		1		19
B&W Thermal	560		200		360		3		3		—
Corporate	1		—		1		450		—		450
	$	1,580	$	418	$	1,162	$	384	$	(85)	$	469
(1) Other amounts consist primarily of facility closure costs and other costs that are not considered as severance.

Restructuring liabilities are included in Other accrued warranty expense by $4.7 million and $2.2 million, respectively, to reflect the expiration of warranties, and updated its estimated warranty accrual rate to reflect its warranty claims experience and current contractual warranty obligations, which reduced the accrued warranty expense by $4.1 million liabilitiesin the ~~nine~~Condensed Consolidated Balance Sheets. Activity related to the restructuring liabilities is as follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Balance at beginning of period	$	2,505	$	1,615
Restructuring expense	1,580		384
Payments and other	(1,966)		37
Balance at end of period	$	2,119	$	2,036

The payments shown above for the three months ended ~~September 30, 2017. Additions~~March 31, 2024 and 2023 relate primarily to ~~the warranty accrual include specific provisions on industrial steam projects totaling $7.1 million~~severance and ~~$2.1 million during the nine months ended September 30, 2017~~facility closure costs. Accrued restructuring liabilities at March 31, 2024 and ~~2016, respectively.~~2023 relate primarily to employee termination benefits.

NOTE 1612 – PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS

Components of net periodic benefit cost (benefit) included in net ~~income (loss)~~loss are as follows:


	Pension Benefits				Other Benefits
	Three Months Ended March 31,					Three Months Ended March 31,
(in thousands)	2024		2023				2024		2023
Interest cost	$	10,808	$	11,489			$	70	$	92
Expected return on plan assets	(11,200)		(11,697)				—		—
Amortization of prior service cost	53		52				173		173
Benefit plans, net (1)	(339)		(156)				243		265
Service cost included in COS (2)	171		144				4		4
Net periodic benefit cost (benefit)	$	(168)	$	(12)			$	247	$	269

Pension benefits Other benefits
Three months ended September 30, Nine months ended September 30, Three months ended September 30, Nine months ended September 30,
(in thousands) 2017 2016 2017 2016 2017 2016 2017 2016
Service cost $ 227
$ 548
$ 756
$ 1,137
$ 3
$ 6
$ 11
$ 18
Interest cost 10,369
10,086
30,905
30,890
(106 ) 206
255
629
Expected return on plan assets (14,936 ) (15,925 ) (44,646 ) (46,107 ) —
—
—
—
Amortization of prior service cost 29
81
80
335
(561 ) —
(2,277 ) —
Recognized net actuarial loss —
645
1,062
30,545
—
—
—
—
Net periodic benefit cost (benefit) $ (4,311 ) $ (4,565 ) $ (11,843 ) $ 16,800
$ (664 ) $ 212
$ (2,011 ) $ 647
(1) Benefit plans, net, which is presented separately in the Condensed Consolidated Statements of Operations, is not allocated to the segments.

(2) Service cost related to a small group of active participants is presented within Cost of operations in the Condensed Consolidated Statements of Operations and is recorded at the B&W Thermal segment level.

~~During the first quarter of 2017, lump sum payments from our Canadian pension plan resulted in a plan settlement of $0.4 million, which also resulted in interim mark to market accounting~~

There were no MTM adjustments for the pension ~~plan. The mark to market adjustment in the first quarter of 2017 was $0.7 million. The effect of these charges~~ and ~~mark to market adjustments are reflected in the $1.1 million "~~Recognized net actuarial loss" for the nine months ended September 30, 2017 in the table above. There were no significant plan settlements or interim mark to market adjustments during the second or third quarters of 2017.

During the second and third quarters of 2016, we recorded adjustments to our benefit plan liabilities resulting from certain curtailment and settlement events. In September 2016, lump sum payments from our Canadian pension plan resulted in a $0.1 million pension plan settlement charge. In May 2016, the closure of our West Point, Mississippi manufacturing facility resulted in a $1.8 million curtailment charge in our United States pension plan. In April 2016, lump sum payments from our Canadian pension plan resulted in a $1.1 million plan settlement charge. ~~These events resulted in interim mark to market accounting for the respective~~other postretirement benefit plans ~~in 2016. Mark to market charges in~~during the three months ended ~~September 30, 2016 were $0.5 million in our Canadian pension plan. Mark to market charges for our United States~~March 31, 2024 and Canadian pension plans were $27.5 million in the nine months ended September 30, 2016. The pension mark to market charges were impacted by higher than expected returns on pension plan assets. The weighted-average discount rate used to remeasure the benefit plan liabilities at September 30, 2016 was 3.88%. The effect of these charges and mark to market adjustments are reflected in the 2016 "Recognized net actuarial loss" in the table above.2023.

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~~We have excluded the recognized net actuarial loss from our reportable segments and such amount has been reflected in~~ ~~Note 3~~ ~~as the mark to market adjustment in the reconciliation of reportable segment income (loss) to consolidated operating losses. The recognized net actuarial loss during the~~ ~~three and nine~~ ~~months ended September 30, 2017 and 2016 was recorded in our condensed consolidated statements of operations in the following line items:~~

Pension benefits
Three months ended September 30, Nine months ended September 30,
(in thousands) 2017 2016 2017 2016
Cost of operations $ —
$ 580
$ 954
$ 30,079
Selling, general and administrative expenses —
64
106
465
Other —
—
2
—
Total $ —
$ 644
$ 1,062
$ 30,544

We made contributions to ~~our~~the pension and other postretirement benefit plans totaling ~~$9.8 million and $16.2~~$0.3 million during ~~the~~the three ~~and nine~~ months ended ~~September 30, 2017, respectively, as compared to $1.8 million~~ March 31, 2024and ~~$4.4 million during the three and nine months ended September 30, 2016, respectively.~~2023.

~~See Note 23 for the future expected effect of FASB ASU 2017-07 on the presentation of benefit and expense related to our pension and post retirement plans.~~

NOTE 1713 – ~~REVOLVING~~ DEBT AND CREDIT FACILITIES

Senior Notes

The components of ~~our revolving debt~~senior notes outstanding at March 31, 2024 are ~~comprised~~as follows:


	Senior Notes
(in thousands)	8.125%		6.50%		Total
Senior notes due 2026	$	193,035	$	151,440	$	344,475
Unamortized deferred financing costs	(2,631)		(3,732)		(6,363)
Unamortized premium	276		—		276
Net debt balance	$	190,680	$	147,708	$	338,388

The components of ~~separate revolving credit facilities in the following locations:~~senior notes outstanding at December 31, 2023 are as follows:


	Senior Notes
(in thousands)	8.125%		6.50%		Total
Senior notes due 2026	$	193,035	$	151,440	$	344,475
Unamortized deferred financing costs	(2,899)		(4,019)		(6,918)
Unamortized premium	312		—		312
Net debt balance	$	190,448	$	147,421	$	337,869

Revolving and Letter of Credit Agreements with Axos

(in thousands) September 30, 2017 December 31, 2016
United States $ 58,900
$ 9,800
Foreign 12,398
14,241
Total revolving debt $ 71,298
$ 24,041

~~United States revolving credit facility~~

~~On May 11, 2015, we~~We entered into a credit agreement in January 2024, with ~~a syndicate~~certain of our subsidiaries as guarantors, the lenders ~~("Credit~~party thereto from time to time and Axos, as administrative agent, swingline lender and letter of credit issuer (the "Credit Agreement") ~~in connection with our spin-off from The Babcock & Wilcox Company.~~ .

The Credit Agreement ~~which is scheduled to mature on June 30, 2020,~~ provides for ~~a senior secured~~an up to $150.0 million asset-based revolving credit facility ~~initially~~(with availability subject to a borrowing base calculation) ("Credit Facility"), including a $100.0 million letter of credit sublimit. Our obligations under the

Credit Agreement are guaranteed by certain of our domestic and foreign subsidiaries. B. Riley has provided a guaranty of payment with regard to our obligations under the Credit Agreement, as further described below. We used and expect to use the proceeds and letter of credit availability under the Credit Agreement to (i) pay off our prior revolving credit facility with PNC, (ii) provide for working capital needs, (iii) provide cash collateral to secure letters of credit to be issued under the Credit Agreement, and (iv) provide for general corporate purposes.

The Credit Agreement has a maturity date of January 18, 2027, provided that if as of August 30, 2025 the 8.125% Senior Notes and 6.50% Senior Notes have not been refinanced pursuant to a Permitted Refinancing, as defined in ~~an aggregate~~the Credit Agreement, or the maturity date has not otherwise been extended to a date on or after July 18, 2027, then the maturity date of the Credit Agreement is August 30, 2025.

The interest rates applicable under the Credit Agreement are: (i) with respect to SOFR Loans, (a) SOFR plus 5.25% if the outstanding principal amount of uploans is equal to ~~$600.0 million. The proceeds from~~or less than $100.0 million or (b) SOFR plus 4.00% if the outstanding principal amount of loans is equal to or greater than $100.0 million; (ii) with respect to Base Rate Loans, the greater of (a) the Federal Funds Rate plus 2.00% plus the Applicable Margin, (b) the prime rate as designated by Axos plus the Applicable Margin, and (c) Daily Simple SOFR plus 1.00% plus the Applicable Margin; and (iii) with respect to the default rate under the Credit Agreement, the then-existing interest rate plus 2.00%.

In connection with the Credit Agreement, we are required to pay (i) an origination fee of $1.5 million, (ii) a commitment fee equal to 0.50% per annum multiplied by the positive difference by which the Aggregate Revolving Commitments exceed the Total Revolvings Outstanding (as defined in the Credit Agreement), subject to adjustment, (iii) a facility fee equal to the Applicable Margin for SOFR Loans multiplied by the positive difference by which the actual daily amount of L/C Obligations the Administrative Agent is then holding Specified Cash Collateral exceeds the actual daily Outstanding Amount of Revolving Loans, and (iv) a collateral monitoring fee of $1,000 per month. We are permitted to prepay all or any portion of the loans under the Credit Agreement prior to maturity subject to the payment of an early termination fee. The Credit Agreement requires mandatory prepayments under certain circumstances, including in the event of an overadvance.

The obligations under the Credit Agreement are ~~available~~secured by substantially all assets of B&W and each of the guarantors, in each case subject to intercreditor arrangements. The Credit Agreement contains certain representations and warranties, affirmative covenants, negative covenants and conditions that are customarily required for ~~working~~similar financings. The Credit Agreement requires us to comply with certain financial maintenance covenants, including a quarterly fixed charge coverage test, a quarterly total net leverage ratio test, a cash repatriation covenant, a minimum liquidity covenant, an annual cap on maintenance capital ~~needs~~expenditures and a limit on unrestricted cash.

The Credit Agreement also contains customary events of default (subject, in certain instances, to specified grace periods) including, but not limited to, the failure to make payments of interest or premium, if any, on, or principal under the Credit Agreement, the failure to comply with certain covenants and agreements specified in the Credit Agreement, defaults in respect of certain other indebtedness, and certain events of insolvency. If any event of default occurs, Axos may declare the principal, premium, if any, interest and any other monetary obligations on all the then outstanding amounts under the Credit Agreement may become due and payable immediately. At March 31, 2024, we are in compliance with all financial and other ~~general corporate purposes, and~~covenants contained in the ~~full amount is available to support~~Credit Agreement.

In connection with our entry into the ~~issuance of letters of credit.~~

~~On February 24, 2017 and August 9, 2017,~~Credit Agreement, we entered into ~~amendments~~with B. Riley (i) a guaranty agreement in favor of (a) Axos, in its capacity as administrative agent under the Credit Agreement, for the ratable benefit of the Secured Parties and (b) such Secured Parties (the “B. Riley Guaranty”) and (ii) a fee and reimbursement agreement, made by B. Riley and accepted and agreed to by us (the “B. Riley Fee Agreement”). The B. Riley Guaranty provides for the guarantee of all of our obligations under the Credit Agreement. The B. Riley Guaranty is enforceable in certain circumstances, including, among others, certain events of default and the acceleration of our obligations under the Credit Agreement. The B. Riley Fee Agreement provides, among other things, for an annual fee to be paid to B. Riley by us in an annual amount equal to 2.00% of Aggregate Revolving Commitments under the Credit Agreement (or approximately $3 million) as consideration for B. Riley’s agreements and commitments under the B. Riley Guaranty. The B. Riley Fee Agreement also requires us to reimburse B. Riley to the extent the B. Riley Guaranty is called upon by the agent or lenders under the Credit Agreement and requires us to execute a junior secured promissory note with respect to the same within 60 days after the execution of the B. Riley Fee Agreement (or such other date as B. Riley may agree to).

the Increased Inventory Period commences on April 30 and ends on July 31 and would provide approximately $6.0 million additional available borrowings under the Credit Agreement. The Increased Inventory Period is available to us upon our election in subsequent years (subject to a $75,000 fee if we make such an election) and commences on March 1 and ends on July 31.

At March 31, 2024, we had a total of $90.1 million outstanding on the Axos Credit Agreement, which includes $36.8 million drawn on the revolving credit portion of the facility and $53.3 million drawn on the letter of credit portion. At March 31, 2024, cash collateralizing the letters of credit totaling $53.3 million is classified as ~~amended~~Restricted cash, of which $11.9 million is classified as current and $41.4 million as long-term.

As of March 31, 2024, Loans payable in the Condensed Consolidated Balance Sheets totaled $103.2 million, net of debt issuance costs of $0.5 million, of which $4.5 million is classified as current and $98.7 million as long-term loans payable in the Consolidated Balance Sheets. In addition to ~~date,~~ the ~~“Amended~~amounts outstanding on our revolving debt facilities, Loans payable also includes $12.1 million, net of debt issuance costs of $0.5 million, related to sale-leaseback financing transactions.

As of December 31, 2023, we had Loans payable of $41.6 million, net of debt issuance costs of $0.5 million, of which $6.2 million is classified as current and $35.4 million as long-term loans payable in the Consolidated Balance Sheets. Included in these amounts was approximately $12.3 million, net of debt issuance costs of $0.5 million, related to sale-leaseback financing transactions.

Revolving and Letter of Credit Agreements with PNC and MSD

In June 2021, we entered into a Revolving Credit Agreement (the “Revolving Credit Agreement”) with PNC, as administrative agent and a letter of credit agreement (the “Letter of Credit Agreement”) with PNC, pursuant to ~~among~~which PNC agreed to issue up to $110.0 million in letters of credit that is secured in part by cash collateral provided by MSD, as well as a reimbursement, guaranty and security agreement with MSD, as administrative agent, and the cash collateral providers from time to time party thereto, along with certain of our subsidiaries as guarantors, pursuant to which we are obligated to reimburse MSD and any other ~~things: (1) permit us~~cash collateral provider to ~~incur~~ the ~~debt~~extent the cash collateral provided by MSD and any other cash collateral provider to secure the Letter of Credit Agreement is drawn to satisfy draws on letters of credit (the “Reimbursement Agreement” and collectively with the Revolving Credit Agreement and Letter of Credit Agreement, the “Debt Facilities”). Our obligations under the ~~second lien term loan facility (discussed further in Note 18), (2) modify~~Debt Facilities were guaranteed by certain of our existing and future domestic and foreign subsidiaries. B. Riley, a related party, provided a guaranty of payment with regard to our obligations under the ~~definition of EBITDA in~~Reimbursement Agreement. The Debt Facilities were effectively replaced by the ~~Amended~~Axos Credit Agreement to exclude: up to $98.1 million of charges for certain Renewable segment contracts for periods including the quarter ended December 31, 2016, up to $115.2 million of charges for certain Renewable segment contracts for periods including the quarter ended June 30, 2017, up to $4.0 million of aggregate restructuring expenses incurred during the period from July 1, 2017 through September 30, 2018 measured on a consecutive four-quarter basis, realized and unrealized foreign exchange losses resulting from the impact of foreign currency changes on the valuation of assets and liabilities, and fees and expenses incurredin January 2024. The Revolving Credit Agreement was terminated in connection with our entry into the August 9, 2017 amendment, (3) replace the maximum leverage ratio with a maximum senior debt leverage ratio, (4) decrease the minimum consolidated interest coverage ratio, (5) limit our ability to borrow under the AmendedAxos Credit Agreement during the covenant relief period to $250.0 million in the aggregate, (6) reduce commitments under the revolving credit facility from $600.0 million to $500.0 million, (7) require us to maintain liquidity (as defined in the Amended Credit Agreement) of at least $75.0 million as of the last business day of any calendar month, (8) require us to repay outstanding borrowings under the revolving credit facility (without any reduction in commitments) with certain excess cash, (9) increase the pricing for borrowings and commitment fees under the Amended Credit Agreement, (10) limit our ability to incur debt and liens during the covenant relief period, (11) limit our ability to make acquisitions and investments in third parties during the covenant relief period, (12) prohibit us from paying dividends and undertaking stock

~~Table of Contents~~

repurchases during the covenant relief period (other than our share repurchase from an affiliate of AIP (discussed further in Note 18)), (13) prohibit us from exercising the accordion described below during the covenant relief period, (14) limit our financial and commercialwe are transitioning letters of credit outstanding under the ~~Amended~~Letter of Credit Agreement and Reimbursement Agreement to ~~$30.0~~the Axos Credit Agreement. We believe all outstanding letters of credit will be transitioned to the Axos Credit Agreement by June 30, 2024, at which time the Letter of Credit Agreement and Reimbursement Agreement is expected to be terminated. We recognized a Loss on debt extinguishment of $5.1 million ~~during~~in the ~~covenant relief period, (15) require us~~three months ended March 31, 2024 related to ~~reduce commitments~~the write-off of unamortized deferred financing fees on the Revolving Credit Agreement.

The Letter of Credit Agreement requires fees on outstanding letters of credit equal to (i) administrative fees of 0.75% and (ii) fronting fees of 0.25%. Prepayments under the ~~Amended~~Reimbursement Agreement are subject to a prepayment fee of 2.25% in the first year after closing, 2.0% in the second year after closing and 1.25% in the third year after closing with no prepayment fee payable thereafter. We have mandatory prepayment obligations under the Reimbursement Agreement upon the receipt of proceeds from certain dispositions or casualty or condemnation events.

The obligations under the Debt Facilities are secured by substantially all of our assets and each of the guarantors, in each case subject to inter-creditor arrangements. As noted above, the obligations under the Letter of Credit ~~Agreement~~Facility are also secured by the cash collateral provided by MSD and any other cash collateral provider thereunder.

The Debt Documents contain certain representations and warranties, affirmative covenants, negative covenants and conditions that are customarily required for similar financings. The Debt Documents also contain customary events of default (subject, in certain instances, to specified grace periods) including, but not limited to, the failure to make payments of interest or premium, if any, on, or principal under the respective facility, the failure to comply with certain covenants and agreements specified in the ~~proceeds~~applicable debt agreement, defaults in respect of certain ~~debt issuances~~other indebtedness and ~~asset sales, (16)~~certain events of insolvency. If any event of default occurs, the principal, premium, if any, interest and any other monetary obligations on all then-outstanding amounts under the Debt Facilities may become due and payable immediately.

In November 2023, we entered into Amendment No. 3 to the Reimbursement Agreement (the “Third Amended Reimbursement Agreement”), which modified certain financial maintenance covenants for future periods beginning with the fiscal quarter ended on September 30, ~~2017, limit~~2023. The Third Amended Reimbursement Agreement also imposed a leverage condition to ~~no more than $25.0 million any cumulative net income losses attributable to certain Vølund projects, and (17) increase reporting obligations and require~~the payment of dividends on preferred equity, which required us to ~~hire~~provide a ~~third-party consultant. The covenant relief period will end, at our election, when~~quality of earnings report and pay a $1.0 million fee to MSD prior to paying a dividend for the ~~conditions set forth in the Amended Credit Agreement are satisfied, but in no event earlier than the date on which we provide the compliance certificate for our~~ fiscal quarter ending December 31, ~~2018.~~

~~Other than during the covenant relief period, the Amended Credit Agreement contains an accordion feature that allows us, subject~~2023. The interest rates applicable to the ~~satisfaction of certain conditions, including the receipt of increased commitments~~Third Amended Reimbursement Agreement float at a rate per annum equal to SOFR plus 10% through December 31, 2023, SOFR plus 11% from ~~existing lenders or new commitments from new lenders, to~~January 1, 2024 through June 30, 2024 and will increase ~~the amount~~by 50 basis points as of the commitments under the revolving credit facility in an aggregate amount not to exceed the sum of (1) $200.0 million plus (2) an unlimited amount, so long as for any commitment increase under this subclause (2) our senior leverage ratio (assuming the full amount of any commitment increase under this subclause (2) is drawn) is equal to or less than 2.00:1.0 after giving pro forma effect thereto. During the covenant relief period, our ability to exercise the accordion feature will be prohibited.

The Amended Credit Agreement and our obligations under certain hedging agreements and cash management agreements with our lenders and their affiliates are (1) guaranteed by substantially all of our wholly owned domestic subsidiaries, but excluding our captive insurance subsidiary, and (2) secured by first-priority liens on certain assets owned by us and the guarantors. The Amended Credit Agreement requires interest payments on revolving loans on a periodic basis until maturity. We may prepay all loans at any time without premium or penalty (other than customary LIBOR breakage costs), subject to notice requirements. The Amended Credit Agreement requires us to make certain prepayments on any outstanding revolving loans after receipt of cash proceeds from certain asset sales or other events, subject to certain exceptions and a right to reinvest such proceeds in certain circumstances. During the covenant relief period, such prepayments may require us to reduce the commitments under the Amended Credit Agreement by a corresponding amount of such prepayments. Following the covenant relief period, such prepayments will not require us to reduce the commitments under the Amended Credit Agreement.

After giving effect to Amendments, loans outstanding under the Amended Credit Agreement bear interest at our option at either (1) the LIBOR rate plus 5.0% per annum or (2) the base rate (the highest of the Federal Funds rate plus 0.5%, the one month LIBOR rate plus 1.0%, or the administrative agent's prime rate) plus 4.0% per annum. Interest expense associated with our United States revolving credit facility loans for the three and nine months ended September 30, 2017 was $3.3 million and $7.0 million, respectively. Included in interest expense was $1.3 million and $2.1 million of non-cash amortization of direct financing costs for the three and nine months ended September 30, 2017, respectively. A commitment fee of 1.0% per annum is charged on the unused portions of the revolving credit facility. A letter of credit fee of 2.50% per annum is charged with respect to the amount of each financial letter of credit outstanding, and a letter of credit fee of 1.50% per annum is charged with respect to the amount of each performance and commercial letter of credit outstanding. Additionally, an annual facility fee of $1.5 million is payable on the first ~~business day of 2018 and 2019, and a pro rated amount is payable on the first business day of 2020.~~

~~The Amended Credit Agreement includes financial covenants that are tested on a quarterly basis, based on the rolling four-quarter period that ends on the last~~ day of each fiscal ~~quarter.~~quarter thereafter.

In March 2024, we entered into Amendment No. 4 to the Reimbursement Agreement (the "Fourth Amended Reimbursement Agreement"), which modified certain financial maintenance covenants for periods beginning with the fiscal quarter ended on December 31, 2023. The ~~maximum permitted senior debt leverage ratio~~Fixed Charge Coverage Ratio was amended to 0.93 to 1.0 for the fiscal quarter ending December 31, 2023, 0.82 to 1.0 for the fiscal quarter ending March 31, 2024, 0.90 to 1.0 for the fiscal quarter ending June 30, 2024, 0.95 to 1.0 for the fiscal quarter ending September 30, 2024, 1.1 to 1.0 for the fiscal quarter ending December 31, 2024, and 1.25 to 1.0 for the fiscal quarter ending March 31, 2025 and thereafter. The Senior Net Leverage Ratio condition to payment of any Permitted Restricted Payments, as defined in the Fourth Amended ~~Credit~~Reimbursement Agreement, ~~is:~~

~~6.00:~~was amended to 1.45 to 1.0 for the four quarter ~~ended September 30, 2017,~~

~~8.50:1.0 for each~~fiscal measurement period ending as of ~~the quarters ending~~ December 31, ~~2017~~2023 and ~~March 31, 2018,~~

~~6.25:~~1.25 to 1.0 ~~for~~thereafter. The Fourth Amended Reimbursement Agreement also amends the ~~quarter ending June 30, 2018,~~

~~4.00:1.0 for the quarter ending September 30, 2018,~~

~~3.75:1.0 for the quarter ending December 31, 2018,~~

~~3.25:1.0 for each of the quarters ending March 31, 2019 and June 30, 2019, and~~

~~3.00:1.0 for each of the quarters ending September 30, 2019 and each quarter thereafter.~~

~~The~~ minimum ~~consolidated interest coverage ratio as defined in the Credit Agreement is:~~

~~1.50:1.0 for the quarter ended September 30, 2017,~~

~~1.00:1.0 for each of the quarters ending December 31, 2017 and March 31, 2018,~~

~~1.25:1.0 for the quarter ending June 30, 2018,~~

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~~1.50:1.0 for each of the quarters ending September 30, 2018 and December 31, 2018,~~

~~1.75:1.0 for each of the quarters ending March 31, 2019 and June 30, 2019, and~~

~~2.00:1.0 for each of the quarters ending September 30, 2019 and each quarter thereafter.~~

~~Beginning with September 30, 2017, consolidated capital expenditures in each fiscal year are limited to $27.5 million.~~

At September 30, 2017, usage under the Amended Credit Agreement consisted of $58.9 million in borrowings at an effective interest rate of 6.88%, $7.7 million of financial letters of credit and $87.2 million of performance letters of credit. At September 30, 2017, we had $94.7 million available for borrowings or to meet letter of credit requirements primarily based on trailing 12 month EBITDA, and our leverage (as defined in the Amended Credit Agreement) ratio was 3.00 and our interest coverage ratio was 2.59. In addition, through September 30, 2017, we have used $11.6 million of the $25.0 million of permitted net income losses attributable to our Vølund projects. At September 30, 2017, we were in compliance with all of thecash flow covenants set forth in the ~~Amended~~Reimbursement Agreement to no less than $10.0 million as of December 31, 2023 (for the preceding fiscal quarter), no less than $15.0 million as of December 31, 2024 (for the preceding fiscal year), and no less than $25.0 million as of December 31 of each fiscal year thereafter. The Applicable Margin with respect to Delayed Draw Term Loans and Cash Collateral Commitment Fees will increase by an additional 0.50% on each of April 30, 2024, July 1, 2024, October 1, 2024, January 1, 2025 and April 1, 2025 in each case if the Obligations are in excess of $15 million on the applicable date. At March 31, 2024, we are in compliance with all financial and other covenants contained in the Letter of Credit Agreement and Reimbursement Agreement.

~~Foreign revolving~~A summary of usage of letters of credit under the domestic facilities is as follows. Due to the timing of the transition of our Letter of Credit Arrangements from PNC and MSD to Axos, balances as of March 31, 2024 are primarily with Axos and balances as of March 31, 2023 are with PNC and MSD.


	March 31,
	2024		2023
Letters of credit under domestic facilities:
Performance letters of credit	$	68,059	$	93,213
Financial letters of credit	11,511		13,648
Total outstanding	$	79,570	$	106,861




Backstopped letters of credit	$	17,169	$	32,397
Surety backstopped letters of credit	$	15,329	$	14,149
Letters of credit subject to currency revaluation	$	47,954	$	68,435

~~Outside~~

Other Letters of credit, bank guarantees and surety bonds

Certain of our subsidiaries, that are primarily outside of the United States, we have revolving credit facilities in Turkey, China and India that are used to provide working capital to our operations in each country. These three foreign revolving credit facilities allow us to borrow up to $14.8 million in aggregate and each have a one year term. At September 30, 2017, we had $12.4 million in borrowings outstanding under these foreign revolving credit facilities at an effective weighted-average interest rate of 5.17%.

~~Other credit arrangements~~

We have posted surety bonds to support contractual obligations to customers relating to certain ~~projects.~~contracts. We utilize bonding facilities to support such obligations, but the issuance of bonds under those facilities is typically at the surety's discretion. Although there can be no assurance that we will maintain our surety bonding capacity, we believe our current capacity is adequate to support our existing project requirements for the next 12 months. In addition, theseThese bonds generally indemnify customers should we fail to perform our obligations under ~~the~~our applicable contracts. We, and certain of our subsidiaries, have jointly executed general agreements of indemnity in favor of surety underwriters relating to surety bonds ~~those~~the underwriters issue in support of some of our contracting activity. As

The following table provides a summary of ~~September 30, 2017, bonds~~outstanding letters of credit issued outside of the domestic facilities, and outstanding surety bonds:


	March 31,
	2024		2023





Letters of credit under non-domestic facilities	39,041		52,970






Surety Bonds	$	146,838	$	269,444

Our ability to obtain and maintain sufficient capacity under ~~these arrangements~~our current debt facilities is essential to allow us to support the issuance of letters of credit, bank guarantees and surety bonds. Without sufficient capacity, our ability to support contract security requirements in ~~support of contracts totaled approximately $472.3 million.~~the future will be diminished.

NOTE 1814 – ~~SECOND LIEN TERM LOAN FACILITY~~CAPITAL STOCK

Preferred Stock

During the three months ending March 31, 2024, our Board of Directors approved dividends totaling $3.7 million to holders of the Preferred Stock. There were no cumulative undeclared dividends of the Preferred Stock at March 31, 2024, and all declared dividends have been paid as of April 1, 2024.

Common Stock

On ~~August 9, 2017,~~April 10, 2024, we entered into a ~~second lien credit~~sales agreement (the ~~"Second Lien Credit Agreement"~~“Sales Agreement”) with ~~an affiliate of American Industrial Partners ("AIP"~~B. Riley Securities, Inc., Seaport Global Securities LLC, Craig-Hallum Capital Group LLC and Lake Street Capital Markets, LLC (together, the “Agents”), ~~governing a second lien term loan facility. The second lien term loan facility consists of a second lien term loan~~ in the principal amount of $175.9 million, all of which was borrowed on August 9, 2017, and a delayed draw term loan facility in the principal amount of up to $20.0 million, which may be drawn in a single draw prior to June 30, 2020, subject to certain conditions. Through September 30, 2017, we have not utilized the delayed draw term loan facility.

Borrowings under the second lien term loan, other than the delayed draw term loan, have a coupon interest rate of 10% per annum, and borrowings under the delayed draw term loan have a coupon interest rate of 12% per annum, in each case payable quarterly. Undrawn amounts under the delayed draw term loan accrue a commitment fee at a rate of 0.50%, which was paid at closing. The second lien term loan and any borrowings we may make under the delayed draw term loan have a scheduled maturity of December 30, 2020.

In connection with ~~our entry into~~ the ~~second lien term loan facility, we used $50.9 million~~offer and sale from time to time of ~~the proceeds to repurchase approximately 4.8 million~~ shares of our common stock, ~~(approximately 10%~~having an aggregate offering price of ~~our~~up to $50.0 million through the Agents. As of May 3, 2024, 1.5 million shares ~~outstanding) held by an affiliate of AIP, which was one~~have been sold pursuant to the Sales Agreement. Refer to Note 22 to the Condensed Consolidated Financial Statements for additional discussion of the conditions precedent for the second lien term loan facility. Based on observable and unobservable market data, we determined the fair value of the shares we repurchased from the related party on August 9, 2017 was $16.7 million. We utilized a discounted cash flow model and estimates of our weighted average cost of capital on the transactionSales Agreement.

~~Table of Contents~~NOTE 15 –INTEREST EXPENSE

date to derive the estimated fair value of the share repurchase. The $34.2 million difference between the share repurchase price and the fair value of the repurchased shares was recorded as a discount on the second lien term facility borrowing. Non-cash amortization of the debt discount and direct financing costs will be accreted to the carrying value of the loan through interest expense over the term of the second lien term loan facility utilizing the effective interest method and an effective interest rate of 18.64%.

~~The carrying value of the second lien term loan facility at September 30, 2017 was as follows (in thousands):~~

Face value
Unamortized debt discount
and direct financing costs
Net carrying value
$175,884 $37,500 $138,384

Interest expense ~~associated with our second lien~~in the Condensed Consolidated Financial Statements consisted of the following components:


	Three Months Ended March 31,
(in thousands)	2024		2023
Components associated with borrowings from:
Senior notes	$	6,271	$	6,328

Revolving Credit Facility	1,532		—
	7,803		6,328
Components associated with amortization or accretion of:
Revolving Credit Facility	1,149		984
Senior notes	644		619

	1,793		1,603

Components associated with interest from:
Lease liabilities	548		724
Letter of Credit interest and fees	2,189		2,822
Other interest expense	501		1,179
	3,238		4,725

Total interest expense	$	12,834	$	12,656

The following table provides a reconciliation of Cash, cash equivalents and Current and Long-term restricted cash reporting within the Condensed Consolidated Balance Sheets and in the Condensed Consolidated Statements of Cash Flows:


(in thousands)	March 31, 2024		December 31, 2023
Held by foreign entities	$	25,943	$	44,388
Held by U.S. entities	17,938		20,947
Cash and cash equivalents	43,881		65,335

Reinsurance reserve requirements	$	642	380
Project indemnity collateral (1)	2,012		—
Bank guarantee collateral	1,779		1,823
Letters of credit collateral (2)	53,839		584
Hold-back for acquisition purchase price (3)	—		2,950
Escrow for long-term project (4)	299		297
Current and Long-term restricted cash and cash equivalents	58,571		6,034
Total Cash, cash equivalents and restricted cash	$	102,452	$	71,369

(1) We added $2.0 million in project indemnity restricted cash collateral for a letter of credit agreement ~~is comprised of the following:~~

(in thousands)
Actual for the period
August 9, 2017 through
September 30, 2017

Forecasted for the period
October 1, 2017 through
December 31, 2017
Forecasted for the period
January 1, 2018 through
December 31, 2018
Coupon interest (10%) $2,554 $4,433 $17,588
Amortization of financing costs and discount $1,095 $2,119 $9,678
Total interest expense $3,649 $6,552 $27,266

(2) Beginning in January 2024, we drew $53.3 million on the Axos Credit Agreement for letter of credit collateral, which is reflected in Current and Long-term restricted cash in the Condensed Consolidated Balance Sheets.

(3) The purchase price for FPS was $59.2 million, and included an initial hold-back of $5.9 million which was included in Current restricted cash and cash equivalents and Other accrued liabilities in the Condensed Consolidated Balance Sheets. The final payment was made in the amount of $3.0 million during the first quarter of 2024.

(4) On December 15, 2021, we entered into an agreement to place $11.4 million in an escrow account as security to ensure project performance. The remaining amount of $0.3 million will be reclassified from Long-term restricted cash to Current restricted cash on September 30, 2024, with a scheduled final settlement on September 30, 2025.

NOTE 16 – PROVISION FOR INCOME TAXES

In the three months ended March 31, 2024, income tax expense from continuing operations was $1.3 million, resulting in an effective tax rate of (8.9)%. In the three months ended March 31, 2023, income tax expense from continuing operations was $0.5 million, resulting in an effective tax rate of (4.0)%.

The effective tax rate for the three months ended March 31, 2024 is not reflective of the U.S. statutory rate due to valuation allowances against certain net deferred tax assets and discrete items. We have unfavorable discrete items of $0.5 million and $0.2 million for the three months ended March 31, 2024 and 2023, respectively, which primarily represent withholding taxes.

We are subject to ~~a make-whole premium, voluntary prepayments made during~~federal income tax in the ~~second year after closing~~United States and numerous countries that have statutory tax rates different than the United States federal statutory rate of 21%. The most significant of these foreign operations are subject to a 3.0% premium and voluntary prepayments made during the third year after closing are subject to a 2.0% premium. The Second Lien Credit Agreement requires us to make certain prepayments on any outstanding loans after receipt of cash proceeds from certain asset sales or other events, subject to certain exceptions and a right to reinvest such proceedslocated in ~~certain circumstances, and subject to certain restrictions contained in an intercreditor agreement among the lenders under the Amended Credit Agreement~~Canada, Denmark, Germany, Italy, Mexico, Sweden, and the ~~Second Lien Credit Agreement.~~

~~The Second Lien Credit Agreement contains representations~~United Kingdom, with effective tax rates ranging between approximately 19% and ~~warranties, affirmative~~30%. We provide for income taxes based on the tax laws and ~~restrictive covenants, financial covenants and events of default substantially similar to those contained~~rates in the ~~Amended Credit Agreement, subject~~jurisdictions where we have operations. These jurisdictions may have regimes of taxation that vary in both nominal rates and the basis on which these rates are applied. The consolidated effective income tax rate can vary from period to ~~appropriate cushions. The Second Lien Credit Agreement is generally less restrictive than~~period due to these foreign income tax rate variations, changes in the ~~Amended Credit Agreement.~~jurisdictional mix of our income, and valuation allowances.

NOTE 1917 – CONTINGENCIES

~~ARPA litigation~~Litigation Relating to Boiler Installation and Supply Contract

On ~~February 28, 2014, the Arkansas River Power Authority ("ARPA")~~December 27, 2019, a complaint was filed ~~suit~~ against ~~Babcock & Wilcox Power Generation Group, Inc. (now known as The Babcock & Wilcox~~us by P.H. Glatfelter Company ~~and referred to herein as “BW PGG”~~(“Glatfelter”) in the United States District Court for the Middle District of ~~Colorado (Case~~Pennsylvania, Case No. ~~14-cv-00638-CMA-NYW)~~1:19-cv-02215-JPW, alleging breach of contract, negligence, fraud and other claims arising out of BW PGG's delivery of a circulating fluidized bed boiler and related equipment used in the Lamar Repowering Project pursuant to a 2005 contract.

A jury trial took place in mid-November 2016. Some of ARPA’s claims were dismissed by the judge during the trial. The jury’s verdict on the remaining claims was rendered on November 21, 2016. The jury found in favor of B&W with respect to ARPA’s claims of fraudulent concealment and negligent misrepresentation and on one of ARPA’s claims of breach of ~~contract.~~contract, fraud, negligent misrepresentation, promissory estoppel and unjust enrichment (the “Glatfelter Litigation”). The ~~jury found~~complaint alleges damages in ~~favor~~excess of ~~ARPA~~$58.9 million. On March 16, 2020 we filed a motion to dismiss, and on December 14, 2020 the ~~three remaining claims~~court issued its order dismissing the fraud and negligent misrepresentation claims. On January 11, 2021, we filed an answer and a counterclaim for breach of contract, seeking damages in excess of $2.9 million. On November 30, 2022, we and

Glatfelter each filed cross-motions for summary judgment. On June 21, 2023, the court granted our motion in part, dismissing Glatfelter’s promissory estoppel and ~~awarded~~unjust enrichment claims, dismissing Babcock & Wilcox Enterprises, Inc. entirely (Glatfelter's remaining claim is asserted against The Babcock & Wilcox Company), and finding that Plaintiffs’ claims for damages ~~totaling $4.2~~will be subject to the contractual cap on liability (defined as the $11.7 million ~~which exceeded~~purchase price, subject to certain adjustments), and denied Glatfelter’s motion for summary judgment. The case is now set for trial on August 5, 2024. We intend to continue to vigorously litigate the ~~previous $2.3 million accrual we established in 2012 by $1.9 million. We increased our accrual by $1.9 million~~action. However, given the uncertainty inherent in the fourth quarter of 2016. At September 30, 2017 and December 31, 2016, $4.2 million was included in other accrued liabilities in our consolidated balance sheet, and we have posted a bond pending resolution of post-trial matters.

~~ARPA also requested that pre-judgment interest of $4.1 million plus post-judgment interest at a rate of 0.77% compounded annually be added~~litigation, it is too early to ~~the judgment, together with certain litigation costs. The court granted ARPA $3.7 million of pre-~~

~~Table of Contents~~

judgment interest on July 21, 2017, which we recorded in our June 30, 2017 condensed consolidated financial statements in other accrued liabilities and interest expense. B&W commenced an appeal of the judgment on August 18, 2017, and ARPA filed a notice of cross appeal on August 31, 2017.

~~Stockholder litigation~~

On March 3, 2017 and March 13, 2017, the Company and certain of its officers were named as defendants in two separate but largely identical complaints alleging violations of the federal securities laws. The complaints were brought on behalf of a putative class of investors who purchased the Company's common stock between July 1, 2015 and February 28, 2017 and were filed in the United States District Court for the Western District of North Carolina (collectively, the "Stockholder Litigation"). During the second quarter of 2017, the Stockholder Litigation was consolidated into a single action and a lead plaintiff was selected by the Court. During the third quarter of 2017, the plaintiff further amended its complaint. As amended, the complaint now purports to cover investors who purchased shares between June 17, 2015 and August 9, 2017.

The plaintiff in the Stockholder Litigation alleges fraud, misrepresentation and a course of conduct relating to the facts surrounding certain projects underway in the Company's Renewable segment, which, according to the plaintiff, had the effect of artificially inflating the price of the Company's common stock. The plaintiff further alleges that stockholders were harmed when the Company disclosed on February 28, 2017 and August 9, 2017 that it would incur losses on these projects. The plaintiff seeks an unspecified amount of damages.

~~We believe the allegations in the Stockholder Litigation are without merit, and that~~determine if the outcome of the ~~Stockholder~~Glatfelter Litigation will ~~not~~ have a material adverse impact on our ~~consolidated~~ financial ~~condition,~~position, results of operations or cash ~~flows, net of any insurance coverage.~~flows.

Other

Due to the nature of our business, ~~we are,~~ from time to time, we are involved in routine litigation or subject to disputes or claims related to our business activities, including, among other things: performance or warranty-related matters under our customer and supplier contracts and other business arrangements; and workers' compensation, premises liability and other claims. Based on ~~our~~ prior experience, except as disclosed above, we do not expect that any of these other litigation proceedings, disputes and claims will have a material adverse effect on our consolidated financial ~~condition,~~position, results of operations or cash flows.

NOTE 2018 – ~~DERIVATIVE FINANCIAL INSTRUMENTS~~COMPREHENSIVE INCOME

Our foreign currency exchange ("FX") forward contracts that qualify for hedge accounting are designated as cash flow hedges. The hedged risk is the risk of changes in functional-currency-equivalent cash flows attributable to changes in FX spot rates of forecasted transactions related to long-term contracts. We exclude from our assessment of effectiveness the portion of the fair value of the FX forward contracts attributable to the difference between FX spot ratesGains and ~~FX forward rates. At September 30, 2017 and 2016, we had~~losses deferred ~~approximately $2.5 million and $3.4 million, respectively, of net gains on these derivative financial instruments~~ in accumulated other comprehensive income ~~("AOCI").~~

At September 30, 2017, our derivative financial instruments consisted solely of FX forward contracts. The notional value of our FX forward contracts totaled $121.2 million at September 30, 2017 with maturities extending to November 2019. These instruments consist primarily of contracts to purchase or sell euros(loss) AOCI are generally reclassified and ~~British pounds sterling. We are exposed to credit-related losses~~recognized in the ~~event~~Condensed Consolidated Statements of ~~nonperformance~~Operations once they are realized. The changes in the components of AOCI, net of tax, for the three months ended March 31, 2024 and 2023 were as follows:


(in thousands)	Currency translation loss		Net unrecognized loss related to benefit plans (net of tax)		Total
Balance at December 31, 2023	$	(64,778)	$	(1,583)	$	(66,361)
Other comprehensive (loss) income before reclassifications	(3,125)		231		(2,894)

Balance at March 31, 2024	$	(67,903)	$	(1,352)	$	(69,255)


(in thousands)	Currency translation loss		Net unrecognized loss related to benefit plans (net of tax)		Total
Balance at December 31, 2022	$	(70,333)	$	(2,453)	$	(72,786)
Other comprehensive income before reclassifications	4,592		223		4,815


Balance at March 31, 2023	$	(65,741)	$	(2,230)	$	(67,971)

The amounts reclassified out of AOCI by ~~counterparties to derivative financial instruments. We attempt to mitigate this risk by using major financial institutions with high credit ratings. The counterparties to all~~component and the affected Condensed Consolidated Statements of ~~our FX forward contracts~~Operations line items are ~~financial institutions party to our United States revolving credit facility. Our hedge counterparties have the benefit of the same collateral arrangements and covenants~~ as described under our United States revolving credit facility. During the third quarter of 2017, our hedge counterparties removed the lines of credit supporting new FX forward contracts. Subsequently, we have not entered into any new FX forward contracts.follows (in thousands):


AOCI component	Line items in the Condensed Consolidated Statements of Operations affected by reclassifications from AOCI	Three Months Ended March 31,
		2024		2023


Pension and post retirement adjustments, net of tax	Benefit plans, net	231		223
	Net Income (Loss)	$	231	$	223

•Revolving ~~debt~~Debt. We base the fair ~~values~~value of debt instruments on quoted market prices. Where quoted prices are not available, we base the fair ~~values~~value on Level 2 inputs such as the present value of future cash flows discounted at estimated borrowing rates for similar debt instruments or on estimated prices based on current yields for debt issues of similar quality and terms. The fair value of ~~our debt instruments~~Revolving Debt approximated ~~their~~its carrying ~~value~~amount at ~~September 30, 2017 and December~~March 31, ~~2016.~~2024.

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NOTE 20– RELATED PARTY TRANSACTIONS

~~Non-recurring fair value measurements~~

We believe transactions with related parties were conducted on terms equivalent to those prevailing in an arm's length transaction.

~~The purchase price allocation associated~~

Transactions with B. Riley

Based on Schedule 13D filings with the ~~January 11, 2017 acquisition~~ SEC, B. Riley beneficially owns approximately 32.4% of ~~Universal required significant fair value measurements using unobservable inputs.~~our outstanding common stock as of March 31, 2024. B. Riley currently has the right to nominate one member of our Board of Directors pursuant to the investor rights agreement we entered into with B. Riley in April 2019. The ~~fair value of the acquired intangible assets was determined using the income approach (see Note 4).~~

~~The other-than-temporary impairment~~investor rights agreement also provides pre-emptive rights to B. Riley with respect to certain future issuances of our equity ~~method investment~~securities.

As described further in ~~TBWES (see~~ Note ~~11) required significant fair value measurements using unobservable inputs ("Level 3" inputs as defined~~22, in April 2024, we entered into a sales agreement with B. Riley Securities, Inc., among others, in connection with the ~~fair value hierarchy established by FASB Topic~~ ~~Fair Value Measurements~~offer and ~~Disclosures). We determined the impairment charge by first determining an estimate~~sale from time to time of shares of our common stock. B. Riley will be entitled to compensation equal to 3.0% of the price that could be received to sell the assets and transfer the liabilities held by TBWES in an orderly transaction between market participants at June 30, 2017. The fair value of TBWES's net assets was determined through a combinationgross proceeds from each sale of the ~~cost approach,~~shares sold through it as the designated Agent.

As described in Note 13 to the Condensed Consolidated Financial Statements, in connection with our entry into the Axos Credit Agreement in January 2024, we entered into a ~~market approach~~guaranty agreement and a fee and reimbursement agreement with B. Riley. The B. Riley Guaranty provides for the guarantee of all of our obligations under the Credit Agreement. The B. Riley Guaranty is enforceable in certain circumstances, including, among others, certain events of default and the acceleration of our obligations under the Credit Agreement. The B. Riley Fee Agreement provides, among other things, for us to pay an ~~income approach.~~

~~Our interim goodwill impairment test~~annual fee to B. Riley equal to 2.00% of Aggregate Revolving Commitments under the Credit Agreement (or approximately $3 million) as consideration for B. Riley’s agreements and ~~third quarter impairment charge required significant fair value measurements using unobservable inputs (see Note 13).~~commitments under the B. Riley Guaranty. The ~~fair value of each reporting unit determined~~B. Riley Fee Agreement also requires us to reimburse B. Riley to the extent the B. Riley Guaranty is called upon by the agent or lenders under ~~Step 1~~the Credit Agreement and requires us to execute a junior secured promissory note with respect to the same within 60 days after the execution of the ~~goodwill impairment test was based on~~B. Riley Fee Agreement (or such other date as B. Riley may agree to).

We entered into an ~~income approach using a discounted cash flow analysis, a market approach using multiples~~agreement with BRPI Executive Consulting, LLC, an affiliate of ~~revenue~~B. Riley, in November 2018 and ~~EBITDA~~amended the agreement in November 2020 and December 2023 to retain the services of ~~guideline companies, and a market approach using multiples~~Mr. Kenneth Young, to serve as our Chief Executive Officer until December 31, 2028, unless terminated by either party with thirty days written notice. Under this agreement, payments are $0.75 million per annum, paid monthly. Subject to the achievement of ~~revenue and EBITDA from recent, similar business combinations. The fair value~~certain performance objectives as determined by the Compensation Committee of the ~~assets~~Board of Directors, a bonus or bonuses may also be earned and ~~liabilities for the Renewable and SPIG reporting units determined under Step 2 of the goodwill impairment test were based on either an income or market approach.~~payable to BRPI Executive Consulting, LLC.

The measurement of the net actuarial loss associated with our Canadian pension plan was determined using unobservable inputs (see Note 16). These inputs included the estimated discount rate, expected return on plan assets and other actuarial inputs associated with the plan participants.

The determination of the estimated fair value of the related party share repurchase required significant fair value measurements using unobservable inputs (see Note 18). We utilized a discounted cash flow model and estimates of our weighted average cost of capital on the transaction date to derive the estimated fair value of the share repurchase.

NOTE ~~22 – SUPPLEMENTAL CASH FLOW INFORMATION~~

~~During the nine months ended September 30, 2017 and 2016, we recognized the following non-cash activity in our condensed consolidated financial statements:~~

(in thousands) 2017 2016
Accrued capital expenditures in accounts payable $ 1,118
$ 2,543

~~During the nine months ended September 30, 2017 and 2016, we recognized the following cash activity in our condensed consolidated financial statements:~~

(in thousands) 2017 2016
Income tax payments (refunds), net $ (11,190 ) $ 11,289
Interest payments on our United States revolving credit facility $ 2,876
$ 40
Interest payments on our second lien term loan facility $ 2,492
$ —

~~NOTE 23~~21 – NEW ACCOUNTING PRONOUNCEMENTS AND STANDARDS

New accounting standards to be adopted

We consider the applicability and impact of all issued ASUs. Certain recently issued ASUs were assessed and determined to be not applicable. New accounting standards not yet adopted that could affect ~~our consolidated financial statements~~the Condensed Consolidated Financial Statements in the future are summarized as follows:

In ~~May 2014,~~October 2023, the FASB issued ASU ~~2014-09,~~ ~~Revenue from Contracts with Customers. The new accounting standard provides a comprehensive model~~2023-06, Disclosure Improvements: Codification Amendments in Response to ~~use in accounting for revenue from contracts with customers~~the SEC's Disclosure Update and will replace most existing revenue recognition guidance when it becomes effective. In 2016, the FASB issued accounting standards updates to address implementation issues and to clarify the guidance for identifying performance obligations, licenses; determining if an entity is the principal or agent in a revenue arrangement; and technical corrections and improvements on topics including: contract costs, loss provisions on construction and production contracts and disclosures for remaining and prior-period performance obligations. The new accounting standard also requires more detailed disclosures to enable financial statement users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with

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customers. The new accounting standard is effective for interim and annual reporting periods beginning after December 15, 2017, and permits retrospectively applying the guidance to each prior reporting period presented (full retrospective method) or prospectively applying the guidance and providing additional disclosures comparing results to previous guidance, with the cumulative effect of initially applying the guidance recognized in beginning retained earnings at the date of initial application (modified retrospective method). We have developed a cross-functional team of B&W professionals from across each of our reportable segments and an implementation plan to adopt the new accounting standard. To date, we have analyzed our primary revenue streams and performed a detailed review of a sample of key contracts representative of our products and services in order to assess potential changes in our processes, systems, internal controls and the timing and method of revenue recognition and related disclosures. Based on our preliminary assessment, we do not expect the timing of revenue recognition to change significantly upon adoption of the new accounting standard; however, we are still assessing the impact to process, systems, internal controls and disclosures. We plan to adopt the new accounting standard on January 1, 2018 under the modified retrospective method. The FASB has issued, and may issue in the future, interpretative guidance, which may cause our evaluation to change. Our evaluation will include the existing, uncompleted contracts at that time the new accounting standard is adopted, and as a result, we will not be able to make a final determination about the impact of adopting the new accounting standard until the first quarter of 2018.

~~In January 2016, the FASB issued ASU 2016-1,~~ ~~Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities~~. The new accounting standard is effective for us beginning in 2018, but early adoption is permitted. The new accounting standard requires investments such as available-for-sale securities to be measured at fair value through earnings each reporting period as opposed to changes in fair value being reported in other comprehensive income. We do not expect the new accounting standard to have a significant impact on our financial results when adopted.

~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases (Topic 842)~~. With adoption of this standard, lessees will have to recognize almost all leases as a right-of-use asset and a lease liability on their balance sheet. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Classification will be based on criteria that are similar to those applied in current lease accounting, but without explicit bright lines. The new accounting standard is effective for us beginning in 2019. We do not expect the new accounting standard to have a significant impact on our financial results when adopted.

~~In August 2016, the FASB issued ASU 2016-15,~~ ~~Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments~~Simplification Initiative. The new guidance is intended to ~~reduce diversity~~align U.S. GAAP and SEC requirements while facilitating the application of U.S. GAAP for all entities. The effective date of ASU 2023-06 depends on (1) whether an entity is already subject to the SEC's current disclosure requirements and (2) whether and, if so, when the SEC removed related requirements from its regulations. For entities that are already subject to the SEC's current disclosure requirements, the effective date for each amendment will be the date on which the SEC's removal of that related disclosure requirement from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. If the SEC has not removed the related requirements from its regulations by June 30, 2027, the amendments made by ASU 2023-06 will be removed from the Codification and will not become effective for any entity. We are currently evaluating the impact of this standard on the Condensed Consolidated Financial Statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires a public entity to disclose significant segment expenses and other segment items in ~~practice in how certain transactions are classified in~~interim and annual periods and expands the ~~statement of cash flows. Of the eight classification-related changes this new standard will require in the statement of cash flows, only two of the classification~~ASC 280 disclosure requirements ~~are relevant~~for interim periods. The ASU also explicitly requires public entities with a single reportable segment to ~~our historical cash flow statement presentation (presentation of debt prepayments and presentation of distributions from equity method investees). However,~~provide all segment disclosures under ASC 280, including the new ~~classification requirements would not have changed our historical statement of cash flows. The new standard~~disclosures under the ASU. ASU 2023-07 is effective for usfiscal years beginning ~~in 2018.~~after December 15, 2023 and interim periods within

fiscal years beginning after December 15, 2024. Early adoption is permitted. We ~~do not plan to early adopt the new accounting standard because~~are currently evaluating the impact of this standard on the Condensed Consolidated Financial Statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure of specific categories in the effective tax rate reconciliation and additional information for reconciling items that meet a quantitative threshold. The standard is intended to benefit investors by providing more detailed income tax disclosures to assess how an entity's operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. Early adoption is permitted. Adoption of the standard will only impact the income tax disclosures and is not expected to be material to the Condensed Consolidated Financial Statements.

NOTE 22 – SUBSEQUENT EVENT

On April 10, 2024, we entered into a sales agreement (the "Sales Agreement") with B. Riley Securities, Inc., Seaport Global Securities LLC, Craig-Hallum Capital Group LLC and Lake Street Capital Markets, LLC (together, the "Agents"), in connection with the offer and sale from time to time of shares of our ~~consolidated~~common stock, having an aggregate offering price of up to $50.0 million through the Agents. Any shares to be offered and sold under the Sales Agreement will be issued and sold pursuant to our previously filed and currently effective registration statement ~~of cash flows when adopted.~~

~~In January 2017,~~on Form S-3 initially filed with the ~~FASB issued ASU 2017-01,~~ ~~Business Combinations (Topic 805): Clarifying~~SEC on November 8, 2021 and declared effective by the ~~Definition of a Business.~~ ~~The new guidance clarifies~~SEC on November 22, 2021. A prospectus supplement relating to the definition of a business in an effort to make the guidance more consistent. The guidance provides a test for determining when a group of assets and business activities is not a business, specifically, when substantially alloffering of the ~~fair value~~Shares was filed with the SEC on April 10, 2024.

The shares may be offered and sold through the Agents over a period of time and from time to time by any method that is deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended. The Agents are not required to sell any specific aggregate principal amount of our shares but will act as our sales agents using commercially reasonable efforts consistent with their normal trading and sales practices, on our mutually agreed terms with the Agents. Under the Sales Agreement, the designated Agent will be entitled to compensation equal to 3.0% of the gross ~~assets acquired or disposed~~proceeds from each sale of the shares sold through it as the designated Agent. The amount of net proceeds we will receive from this offering, if any, will depend upon the actual aggregate principal amount of the shares sold, after deduction of the Agents’ commission and any transaction fees. Because there is no minimum offering amount required as a condition to close this offering, the actual total public offering amount, commissions and net proceeds to us, if any, are ~~concentrated in a single identifiable asset or group~~not determinable at this time.

The Sales Agreement contains customary representations, warranties and covenants of ~~assets,~~the Company, indemnification obligations of the Company and ~~if inputs~~the Agents, including for liabilities under the Securities Act, other obligations of the parties and ~~substantive processes that significantly contribute~~termination provisions.

Through May 3, 2024, we have sold 1.5 million shares pursuant to the ability to create outputs is not present. The new accounting standard is effective for us beginning in 2018. We do not expect the new accounting standard to have a significant impact on our financial results when adopted.Sales Agreement.

~~In January 2017, the FASB issued ASU 2017-04,~~ ~~Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.~~ The new guidance removes the requirement to compare implied fair value of goodwill with the carrying amount, therefore impairment charges would be recognized immediately by the amount which carrying value exceeds fair value. The new accounting standard is effective beginning in 2020. We are currently assessing the impact that adopting this new accounting standard will have on our financial statements.

~~In March 2017, the FASB issued ASU 2017-07,~~ ~~Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Benefit Cost and Net Periodic Postretirement Benefit Cost~~. The new guidance classifies service cost as the only component of net periodic benefit cost presented in cost of operations, whereas the other components will be presented in other income. This will affect not only how we present net periodic benefit cost, but also how we present segment gross profit and operating income upon adoption. The new accounting standard is effective for us beginning in 2018. We have

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assessed the impact of adopting the new standard on our consolidated statement of operations and determined the required reclassifications will primarily impact our Power segment's gross profit. The changes in the classification of the historical components of net periodic benefit costs are summarized in the following table:

Pension & other postretirement benefit costs (benefits)
(in thousands)
December 31,
2016
December 31,
2015
Current
classification Future
classification
Service cost $ 1,703
$ 13,701
Cost of operations Cost of operations
Interest cost 41,772
50,644
Cost of operations Other income (expense)
Expected return on plan assets (61,939 ) (68,709 ) Cost of operations Other income (expense)
Amortization of prior service cost 250
307
Cost of operations Other income (expense)
Recognized net actuarial losses -
mark to market adjustments 24,110
40,210
Cost of operations or SG&A expenses Other income (expense)
Net periodic benefit cost (benefit) $ 5,896
$ 36,153

~~New accounting standards that were adopted during the nine months ended September 30, 2017 are summarized as follows:~~

~~In the nine months ended September 30, 2017, the Company adopted ASU 2016-09,~~ ~~Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-based Payment Accounting~~. This new accounting standard has affected how we account for share-based payments, with the most significant impact being the impact of income taxes associated with share-based compensation. Subsequent to adoption, the income tax effects related to share-based payments will be recorded as a component of income tax expense (or benefit) as they occur, rather than being classified as a component of additional paid-in capital. In addition, the effect of excess tax benefits will now be presented in the cash flow statement as an operating activity. We prospectively adopted the new accounting standard. See Note 7 for the effect on the statement of operations for the three and nine months ended September 30, 2017.

~~In the nine months ended September 30, 2017, the Company adopted ASU 2015-11,~~ ~~Inventory (Topic 330): Simplifying the Measurement of Inventory~~. This new accounting standard requires that first-in, first-out inventory be measured at the lower of cost or net realizable value. Under GAAP prior to the adoption of this new accounting standard, inventory was measured at the lower of cost or market, where market was defined as replacement cost, with a ceiling of net realizable value and a floor of net realizable value minus a normal profit margin. Although this new accounting standard raises the threshold on when charges against inventory can occur, we do not expect a significant impact because we have not had significant inventory charges in the past. We prospectively adopted the new accounting standard and it had no impact on our condensed consolidated financial statements for the three or nine months ended September 30, 2017.

~~NOTE 24– SUBSEQUENT EVENT~~

In the third quarter of 2017 and through the date of this report, we have announced plans to implement restructuring actions to improve our global cost structure and increase our financial flexibility. The restructuring actions include a workforce reduction at both the business segment and corporate levels totaling approximately 9% of our global workforce, SG&A expense reductions and new cost control measures, and office closures and consolidations in non-core geographies. These actions include reduction of approximately 30% of B&W Vølund's workforce, which will right-size its workforce to operate under a new execution model focused on B&W's core boiler, grate and environmental equipment technologies, with the balance of plant and civil construction scope being executed by a partner. We believe the new B&W Vølund business model provides the Company with a lower risk profile and aligns with B&W's strategy of being an industrial and power equipment technology and solutions provider. Other actions are focused on productivity and efficiency gains to enhance profitability and cash flows, and to mitigate the impact of lower demand in the global coal-fired power market. Total estimated costs associated with these restructuring actions are anticipated to be approximately $20 million, most of which will be recognized in the fourth quarter of 2017, and the estimated annual savings are expected to be approximately $45 million in 2018.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

~~FORWARD-LOOKING STATEMENTS~~

~~This report~~The following discussion of our financial position and results of operations should be read in conjunction with the financial statements and the notes thereto included in the Condensed Consolidated Financial Statements in Item 1 of this Quarterly Report. The following discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and 21E of the Securities Exchange Act of 1934. You should not place undue reliance on these statements. These forward-looking statements include statements that reflect ~~the current views of~~ our ~~senior management with respect to our financial performance~~plans, estimates, and future events with respect to our business and industry in general. Statements that include the words "expect," "intend," "plan," "believe," "project," "forecast," "estimate," "may," "should," "anticipate" and similar statements of a future or forward-looking nature identify forward-looking statements. Forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause ourbeliefs. Our actual results tocould differ materially from those ~~indicated~~discussed in ~~these statements. These~~the forward-looking statements as a result of many factors, ~~include the cautionary statements included~~including those described in ~~this report and the factors set forth~~more detail under "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, ~~2016 ("Annual Report") filed with the Securities and Exchange Commission. If one or more events related~~2023. See also "Cautionary Statement Concerning Forward-Looking Information" herein. All amounts referred to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. We assume no obligation to revise or update any forward-looking statement included in this ~~report for any reason, except~~discussion and analysis are on a continuing operations basis, unless otherwise noted.

BUSINESS OVERVIEW

We are a growing, globally-focused renewable, environmental and thermal technologies provider with over 155 years of experience providing diversified energy and emissions control solutions to a broad range of industrial, electrical utility, municipal and other customers. Our innovative products and services are organized into three market-facing segments. Our reportable segments are as ~~required by law.~~follows:

~~OVERVIEW OF RESULTS~~

~~In this report, unless the context otherwise indicates, "B&W," "we," "us," "our" and "the Company" mean~~ •Babcock & Wilcox ~~Enterprises, Inc.~~Renewable: Our innovative hydrogen generation technology (BrightLoopTM) supports global climate goals including the decarbonization of industrial and ~~its consolidated subsidiaries. The presentation~~utility steam and power producers. BrightLoopTM offers significant advantages over other hydrogen generation technologies as it generates competitively priced hydrogen from a wide range of fuels (including solid fuels such as biomass and coal) with a high rate of carbon captured resulting in low (or even negative) carbon intensity hydrogen. We also offer best-in-class technologies for efficient and environmentally sustainable power and heat generation, including waste-to-energy, oxygen-fired biomass-to-energy (OxyBrightTM), and black liquor systems for the pulp and paper industry. Our leading waste-to-energy technologies support a circular economy, diverting waste from landfills to use for power generation or district heating, while recovering metals and reducing emissions. To date, we have installed approximately 500 waste-to-energy and biomass-to-energy units at more than 300 facilities in approximately 30 countries which serve a wide variety of utility, waste management, municipality and investment firm customers.

•Babcock & Wilcox Environmental: Our full suite of best-in-class emissions control and environmental technology solutions for utility, waste-to-energy, biomass-to-energy, carbon black, and industrial steam generation applications supports environmental stewardship around the world. Our broad experience includes systems for cooling, ash handling, particulate control, nitrogen oxide and sulfur dioxide removal, dioxin and furan control, carbon dioxide capture, mercury control as well as other acid gas and pollutant control. Our ClimateBrightTM family of products including SolveBrightTM, OxyBrightTM, BrightLoopTM and BrightGenTM, places us at the forefront of hydrogen production and carbon dioxide capturing technologies and development with many of the ~~components~~aforementioned products already commercially available and others ready for commercial deployment. We believe these technologies position us to compete in the bioenergy with carbon capture and sequestration market. Our portfolio of clean power production solutions continues to evolve to reach customers at all stages of their energy transition.

•Babcock & Wilcox Thermal: Our vast installed base of steam generation equipment and related auxiliaries spans the globe and includes customers in a variety of end markets including power generation, oil and gas, petrochemical, food and beverage, metals and mining, and others. We provide aftermarket parts, construction, maintenance, engineered upgrades and field services for our installed base as well as the installed base of other OEMs; the substantial and stable cash flows generated from these businesses helps to fund our investments in new clean energy initiatives. In addition to our aftermarket offerings, we also provide complete steam generation systems including package boilers, watertube and firetube waste heat boilers, and other boilers to medium and heavy industrial customers. Our unique range of offerings, coupled with the strength of our ~~revenues, gross profit~~brand, provides a competitive advantage in existing and ~~operating income on~~emerging markets.

Market Update

Management continues to adapt to macroeconomic conditions, including the ~~following pages of this Management's Discussion~~impacts from inflation, higher interest rates and ~~Analysis of Financial Condition~~foreign exchange rate volatility, geopolitical conflicts (including the ongoing conflicts in Ukraine and ~~Results of Operations is consistent with~~ the ~~way our chief operating decision maker reviews the results of operations~~Middle East) and ~~makes strategic decisions about the business.~~

~~We generally recognize revenues~~global shipping and related costs from long-term contracts on a percentage-of-completion basis. Accordingly, we review contract price and cost estimates regularly as work progresses and reflect adjustments in profit proportionate to the percentage of completion in the periods in which we revise estimates to complete the contract. To the extentsupply chain disruptions that these adjustments result in a reduction of previously reported profits from a project, we recognize a charge against current earnings. Changes in the estimated results of our percentage of completion contracts are necessarily based on information available at the time that the estimates are made and are based on judgments that are inherently uncertain as they are predictive in nature. As with all estimates to complete used to measure contract revenue and costs, actual results can and do differ from our estimates made over time.

~~Our Renewable segment~~have continued to ~~make progress towards completing its portfolio~~have an impact in 2024. In certain instances, these situations have resulted in cost increases and delays or disruptions that have had, and could continue to have, an adverse impact on our ability to meet customers’ demands. We continue to actively monitor the impact of ~~European renewable energy projects in~~these market conditions on

current and future periods and actively manage costs and our liquidity position to provide additional flexibility while still supporting our customers and their specific needs. The duration and scope of these conditions cannot be predicted, and therefore, any anticipated negative financial impact on our operating results cannot be reasonably estimated.

Discontinued Operations

During the third quarter of ~~2017, represented by~~2023, we committed to a ~~$60.4 million increase~~plan to sell our B&W Solar business resulting in ~~revenue compared to~~a significant change that would impact our operations. As of September 30, 2023, we met all of the ~~second quarter~~criteria for the assets and liabilities of ~~2017. Our near break-even gross profit in the~~this business, formerly part of our B&W Renewable segment, in the third quarter of 2017 is a result of recognizing gross profit on our loss contracts only to the extent there are current changes in estimated losses at completion. In September 2017, we identified the failure of a structural steel beam on one of these projects, which temporarily stopped work in the boiler building pending corrective actions to stabilize the structure that are expected to be ~~complete in~~accounted for as held for sale. In addition, we also determined that the ~~fourth quarter of 2017. The engineering, design and manufacturing~~operations of the steel structure were the responsibility of subcontractors. A similar design was also used on two of the other projects, and although no structural failure occurred on these other two projects, work was stopped for a short period of time while reinforcement of the structures is completed. The costs related to these structural steel issues is estimated to be approximately $20 million, primarily related to project delays, and is includedB&W Solar business qualified as a discontinued operation, primarily based upon its significance to our current ~~charge in~~and historic operating losses.

We continued to meet the ~~third quarter of 2017. Also in the third quarter of 2017, we adjusted the design of three of these renewable facilities~~criteria to ~~increase the guaranteed power output, which will allow us to achieve contractual bonus opportunities~~account for the ~~higher output. The bonus opportunities increased the estimated selling price~~B&W Solar business as held for sale and discontinued operations as of the three contracts by approximately $15 million in total, and this positive change in estimated cost to complete was fully recognized in the third quarter of 2017 because each of these three were loss projects.March 31, 2024.

Our Power segment continued to deliver gross margins consistent with our expectations in the third quarter of 2017. As previously disclosed, we anticipated a future decline in the coal power generation markets and proactively responded by restructuring our Power segment to help us hold gross margins. Our 2016 restructuring has been effective, and the Power segment's gross margin percentage has not significantly changed despite the 4.5% decline in revenues in the third quarter of 2017 compared to the same quarter in 2016 and the 19.7% decline in revenues in the nine months ended September 30, 2017

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~~compared to the nine months ended September 30, 2016. The Power segment also continues to benefit from consistent, effective contract execution.~~

The primary driver of the increase in Industrial segment revenues in the third quarter of 2017 was the $16.0 million contribution from Universal Acoustic & Emissions Technology, Inc. ("Universal"), which was acquired on January 11, 2017. The acquisition benefited the Industrial segment's gross profit in the third quarter of 2017, which helped offset the impact of a change in the product mix and challenges related to completing several cooling systems projects. Our MEGTEC business unit recorded sequential increases in quarterly bookings in 2017, which added to strong 2017 bookings at our SPIG business unit, and we expect continued improvement in the Industrial markets to benefit this segment.

We recorded goodwill impairment charges of $86.9 million in the third quarter of 2017. In the quarter, our market capitalization significantly decreased to below our stockholders' equity, which we attributed to the announcement of our second quarter 2017 results that included significant charges in the Renewable reporting unit. Accordingly, we increased the discount rate applied to future projected cash flows, which resulted in a $50.0 million goodwill impairment charge in our Renewable segment. Additionally in the third quarter of 2017, the forecast was reduced for our SPIG reporting unit based on a change in the market strategy implemented by the new segment management to focus on core geographies and products. The forecast reduction in combination with a short-term decrease in profitability attributable to specific current contracts and an increase in the discount rate applied to future projected cash flows resulted in a $36.9 million impairment charge to the SPIG reporting unit within the Industrial segment.

In the third quarter of 2017 and through the date of this report, we have announced plans to implement restructuring actions to improve our global cost structure and increase our financial flexibility. The restructuring actions include a workforce reduction at both the business segment and corporate levels totaling approximately 9% of our global workforce, selling, general and administrative ("SG&A") expense reductions and new cost control measures, and office closures and consolidations in non-core geographies. These actions include reduction of approximately 30% of B&W Vølund's workforce, which will right-size its workforce to operate under a new execution model focused on B&W's core boiler, grate and environmental equipment technologies, with the balance-of-plant and civil construction scope being executed by a partner. We believe the new B&W Vølund business model provides us with a lower risk profile and aligns with our strategy of being an industrial and power equipment technology and solutions provider. Other actions are focused on productivity and efficiency gains to enhance profitability and cash flows, and to mitigate the impact of lower demand in the global coal-fired power market. Total estimated costs associated with these restructuring actions are anticipated to be less than $20 million, most of which will be recognized in the fourth quarter of 2017, and the estimated annual savings are expected to be at least $45 million in 2018.

We used $19.7 million of cash in the third quarter of 2017. Net borrowings on our United States revolving credit facility were $59.2 million, which included the repayment of $115.5 million of the revolving credit facility balance with net proceeds from the issuance of our second lien term loan on August 9, 2017. Our use of cash was primarily to fund progress on our Renewable segment contracts. We expect our operations to use cash through the fourth quarter of 2017 and first part of 2018, particularly in the Renewable segment, as we fund contract losses and work down advanced bill positions. Our forecasted use of cash is expected to be funded in part through borrowings from our United States revolving credit facility.

~~Year-over-year comparisons of our results were also affected by:~~

$4.0 million and $8.8 million of intangible amortization expense in the third quarters of 2017 and 2016, respectively, and $14.5 million and $11.9 million of expense in the nine months ended September 30, 2017 and 2016, respectively. We expect $18.0 million of amortization expense in the full year 2017 compared to $19.9 million of amortization in the full year 2016.

$3.6 million and $7.9 million of restructuring expense was recognized in the third quarter and nine months ended September 30, 2017, respectively, compared to $2.0 million and $34.6 million of restructuring expense in the third quarter and nine months ended September 30, 2016, respectively. The pre-2017 actions restructured our business that serves the power generation market in advance of lower demand projected for power generation from coal in the United States. The 2017 restructuring actions were implemented to help the Power segment continue to manage its fixed costs, align our Renewable segment with the changing business model and achieve SG&A cost savings.

$0.2 million and $1.0 million and of expense related to the spin-off from our former Parent was recognized in the third quarter and nine months ended September 30, 2017, respectively, compared to $0.4 million and $3.4 million in the third quarter and nine months ended September 30, 2016, respectively. The costs were primarily attributable to employee retention awards.

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$3.7 million of interest payable was awarded by the court based on the outcome of our appeal of the November 21, 2016 Arkansas River Power Authority ("ARPA") trial verdict, which was recorded as an increase in interest expense during the nine months ended September 30, 2017.

$0.3 million and $0.8 million of SG&A expenses in the third quarters of 2017 and 2016 associated with acquisition and integration costs related to SPIG and Universal, respectively, and $3.1 million and $1.9 million of acquisition and integration costs in the nine months ended September 30, 2017 and 2016, respectively.

$1.1 million of actuarially determined mark to market losses were recognized in the nine months ended September 30, 2017, which relate to lump sum settlement payments from our Canadian pension plan in the first quarter of 2017.

$0.6 million and $30.5 million of actuarially determined mark to market pension losses in the quarter and nine months ended September 30, 2016, respectively, were triggered by the closure of our West Point, Mississippi manufacturing facility in May 2016 that resulted in a curtailment in our United States pension plan and lump sum payments from our Canadian pension plan in April 2016 that resulted in plan settlements.

~~Our third quarter and year to date segment and other operating results are described in more detail below.~~

RESULTS OF OPERATIONS

~~THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2017 VS. 2016~~

Components of Our Results of Operations

~~Selected~~

Revenue

Revenue is the total amount of income generated by our business and consists primarily of income from the renewable, environmental and thermal technology solutions and services we provide to a broad range of industrial, electric utility and other customers. Revenue from our operations is assessed based on our three market-facing segments, B&W Renewable, B&W Environmental and B&W Thermal.

Operating (loss) income

Operating (loss) income consists primarily of revenue minus costs and expenses, including cost of operations, SG&A, and advisory fees and settlement costs.

Net loss

Net loss consists primarily of operating (loss) income minus other income and expenses, including interest income, foreign exchange and expense related to our benefit plans, and provision for income taxes.

Consolidated Results of Operations

The following discussion of our consolidated and business segment results of operations includes a discussion of adjusted EBITDA, which, when used on a consolidated basis, is a non-GAAP financial ~~highlights are presented~~measure. Adjusted EBITDA differs from net loss, the most directly comparable measure calculated in ~~the table below:~~accordance with GAAP. Management believes that this financial measure is useful to investors because it excludes certain expenses, allowing investors to more easily compare our operating performance period to period. A reconciliation of net loss to adjusted EBITDA is included in “Non-GAAP Financial Measures” below.


	Three Months Ended March 31,
(in thousands)	2024		2023		$ Change
Revenues:
B&W Renewable segment	$	52,281	$	84,123	$	(31,842)
B&W Environmental segment	48,354		39,440		8,914
B&W Thermal segment	110,187		119,236		(9,049)
Eliminations	(3,266)		(1,541)		(1,725)
	$	207,556	$	241,258	$	(33,702)

Three months ended September 30, Nine months ended September 30,
(In thousands) 2017 2016 $ Change 2017 2016 $ Change
Revenues:
Power segment $ 202,222
$ 211,749
$ (9,527 ) $ 612,274
$ 762,293
$ (150,019 )
Renewable segment 108,557
124,344
(15,787 ) 262,168
293,593
(31,425 )
Industrial segment 99,288
76,809
22,479
281,734
147,275
134,459
Eliminations (1,364 ) (1,947 ) 583
(6,540 ) (4,882 ) (1,658 )
408,703
410,955
(2,252 ) 1,149,636
1,198,279
(48,643 )
Gross profit (loss):
Power segment 40,629
48,896
(8,267 ) 132,653
170,903
(38,250 )
Renewable segment 181
18,592
(18,411 ) (100,119 ) 14,468
(114,587 )
Industrial segment 9,461
14,601
(5,140 ) 34,240
33,506
734
Intangible amortization expense included in cost of operations (2,984 ) (7,752 ) 4,768
(11,455 ) (8,833 ) (2,622 )
Mark to market adjustments included in cost of operations —
(580 ) 580
(954 ) (30,079 ) 29,125
47,287
73,757
(26,470 ) 54,365
179,965
(125,600 )
Goodwill impairment charges (86,903 ) —
(86,903 ) (86,903 ) —
(86,903 )
SG&A expenses (59,225 ) (59,615 ) 390
(192,742 ) (179,225 ) (13,517 )
Restructuring activities and spin-off transaction costs (3,775 ) (2,395 ) (1,380 ) (8,910 ) (38,021 ) 29,111
Research and development costs (2,291 ) (2,361 ) 70
(7,454 ) (8,273 ) 819
Intangible amortization expense included in SG&A (1,016 ) (1,018 ) 2
(2,999 ) (3,071 ) 72
Mark to market adjustments included in SG&A —
(64 ) 64
(106 ) (465 ) 359
Equity in income of investees 1,234
2,827
(1,593 ) 4,813
4,887
(74 )
Impairment of equity method investment —
—
—
(18,193 ) —
(18,193 )
Gains (losses) on asset disposals, net (59 ) 2
(61 ) (63 ) 17
(80 )
Operating income (loss) $ (104,748 ) $ 11,133
$ (115,881 ) $ (258,192 ) $ (44,186 ) $ (214,006 )

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~~Condensed and consolidated results of operations~~

Three months ended ~~September 30, 2017 vs. 2016~~March 31, 2024 and 2023

Revenues decreased by ~~$2.3~~$33.7 millionto ~~$408.7~~$207.6 million in the ~~third quarter of 2017~~three months ended March 31, 2024 as compared to ~~$411.0~~$241.3 million in the ~~third quarter of 2016. Anticipated decreases~~three months ended March 31, 2023. Thedecrease was primarily driven by a $22.1 million decrease in ~~construction activities associated with new build and retrofit~~B&W Renewable segment revenue because fewer waste-to-energy projects were performed in the ~~Power segment~~current year as, consistent with our stated strategy, we shift our focus to our higher-margin and lower-risk European Renewable parts and services business and a $6.2 million decrease in B&W Thermal segment revenue as a large project in our U.S. construction business was completed in 2023 that was not fully replaced in 2024.

Operating income for the revenue recognized in the Renewable segment resulting from ongoing performance challenges on our renewable energy contracts were partially offset by the increase in revenue in the Industrial segment resulting from the acquisition of Universal on January 11, 2017.

In the third quarter of 2017, we had consolidated gross profit of $47.3 million, which compares to gross profit of $73.8 million in the third quarter of 2016, a decrease of $26.5 million. The primary drivers of the decrease were the six uncompleted European loss contracts in the Renewable segment (see Note 5 in the condensed consolidated financial statements), productivity issues on new build cooling system projects in the Industrial segment and the volume impact of the decline in the Power segment's revenues, which were partially offset by the gross profit contribution from the Universal acquisition. Intangible asset amortization expense is discussed in further detail in the sections below.

~~Our goodwill impairment charges, restructuring expense and equity in income of investees are discussed in further detail in the sections below.~~

~~Nine~~three months ended ~~September 30, 2017 vs. 2016~~

~~Revenues decreased by~~ March 31, 2024 was $~~48.6 million~~ to $1.15 billion in the nine months ended September 30, 2017 as compared to $1.20 billion for the corresponding nine month period in 2016. The primary decreases were in construction activities associated with new build and retrofit projects in the Power segment and a decrease in the revenue recognized in the Renewable segment resulting from ongoing performance challenges on six of our renewable energy contracts. These declines were partially offset by the increase in revenue in the Industrial segment resulting from the acquisitions of SPIG and Universal.

~~Gross profit decreased by $125.6 million to~~ ~~$54.4 million~~ in the nine months ended September 30, 2017 as compared to $180.0 million in the corresponding period in 2016. The primary drivers of the decrease were the six uncompleted European loss contracts in the Renewable segment (see Note 5 in the condensed consolidated financial statements) and the impact of the decline in the Power segment's revenues, which were partially offset by gross profit contributions from the SPIG and Universal acquisitions. Intangible asset amortization expense is discussed in further detail in the sections below.

~~Excluding amortization of intangible assets and pension mark to market adjustments, SG&A expenses increased by $13.5 million in the nine months ended September 30, 2017 to $192.7~~4.3 million as compared to ~~$179.2~~$1.3 million in the ~~corresponding nine month period~~three months ended March 31, 2023. The increase in ~~2016,~~2024 was driven by a $6.6 million reduction in Selling, general and administrative costs primarily ~~related~~attributable to ~~adding~~a favorable final settlement of a liability to the ~~SPIG~~former owner of B&W Solar, and ~~Universal businesses and ongoing project support activities in the Renewable segment, partially~~ offset by ~~savings from our 2016 restructuring actions. Intangible asset amortization expense and pension mark to market adjustments are discussed in further detail in the sections below.~~

~~Equity in income of investees during the nine months ended September 30, 2017 includes a $18.2~~$3.4 million other-than-temporary-impairment of our investment in Thermax Babcock & Wilcox Energy Solutions Private Limited ("TBWES") that we recorded in the second quarter of 2017. The impairment charge was a result of the strategic change we and our joint venture partner have madelower gross margin due to the ~~decline~~reduced revenue. Gross margin is defined as Revenues less Cost of Sales. Loss from continuing operations increased by $3.1 million to $15.8 million in ~~forecasted market opportunities in India.~~

~~Our goodwill impairment charges and restructuring expense are discussed in further detail in the sections below.~~

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~~Power~~

Three months ended September 30, Nine months ended September 30,
(In thousands) 2017 2016 $ Change 2017 2016 $ Change
Revenues $ 202,222
$ 211,749
$ (9,527 ) $ 612,274
$ 762,293
$ (150,019 )
Gross profit $ 40,629
$ 48,896
$ (8,267 ) $ 132,653
$ 170,903
$ (38,250 )
Gross margin % 20 % 23 % 22 % 22 %

~~Three~~the three months ended ~~September 30, 2017 vs. 2016~~

~~Revenues decreased 4%, or $9.5 million,~~March 31, 2024 as compared to ~~$202.2~~$12.7 million in the ~~third quarter of 2017, compared to $211.7~~three months ended March 31, 2023. The increase was driven by a $5.1 million inLoss on debt extinguishment as the corresponding quarter in 2016. The revenue decrease is attributable to the anticipated decline in the coal power generation market, and primarily impacted our new build utility and environmental product and service line due to a decrease in construction activity. We resized our business in anticipation of these declines with our 2016 restructuring actions. Partially offsetting the revenue decrease was an increase in revenuesremaining deferred financing fees associated with ~~our retrofits product and service line in~~ the ~~third quarter of 2017 compared to the corresponding quarter in 2016.~~terminated PNC Revolving Credit Agreement were written off.

Gross profit decreased 17%, or $8.3 million, to $40.6 million in the quarter ended September 30, 2017, compared to gross profit of $48.9 million in the corresponding quarter in 2016. We were able to largely maintain our gross margin percentage as a result of the 2016 restructuring actions, which partially offset the gross profit effect of lower sales volumes. Compared to the third quarter of 2016, the primary decrease in gross profit in the third quarter of 2017 was attributable to the decrease in gross profit from a lower volume of construction activity associated with our new build utility and environmental equipment product and service line. Also contributing to the decrease were fewer net improvements on projects that were completed this year versus last year.

~~Nine months ended September 30, 2017 vs. 2016~~

~~Revenues decreased~~ ~~20%, or~~ ~~$150.0 million, to~~ ~~$612.3 million~~ in the nine months ended September 30, 2017, compared to $762.3 million in the corresponding nine month period in 2016. The revenue decrease is attributable to the anticipated decline in the coal power generation market discussed above. Compared to the nine months ended September 30, 2016, the primary decrease in revenues in the nine months ended September 30, 2017 was attributable to a decline new build utility and environmental equipment and retrofit projects primarily due to a decrease in construction activity. Partially offsetting those declines in revenues was an increase in industrial steam generation revenues in the nine months ended September 30, 2017 compared to the corresponding nine month period in 2016.

Gross profit decreased 22%, or $38.3 million, to $132.7 million in the nine months ended September 30, 2017, compared to $170.9 million in the corresponding nine month period in 2016. We were able to maintain our gross margin percentage as a result of the 2016 restructuring actions, which partially offset the gross profit effect of lower sales volumes. Compared to the nine months ended September 30, 2016, the decrease in gross margins are attributable to the same reasons discussed in the three month explanations above.

~~Renewable~~

Three months ended September 30, Nine months ended September 30,
(In thousands) 2017 2016 $ Change 2017 2016 $ Change
Revenues $ 108,557
$ 124,344
$ (15,787 ) $ 262,168
$ 293,593
$ (31,425 )
Gross profit (loss) $ 181
$ 18,592
$ (18,411 ) $ (100,119 ) $ 14,468
$ (114,587 )
Gross margin % — % 15 %
(38 )% 5 %

~~Three months ended September 30, 2017 vs. 2016~~

Revenues decreased 13%, or $15.8 million, to $108.6 million in the third quarter of 2017, compared to $124.3 million in the corresponding quarter in 2016. The number of contracts and level of activity in the segment during the third quarter of 2017 and 2016 were comparable. The $15.8 million decrease in revenue in the third quarter of 2017 was primarily attributable to revisions in our estimates of progress and estimated liquidated damages on six of our renewable energy contracts.

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Gross profit decreased $18.4 million in the third quarter of 2017 to $0.2 million, compared to $18.6 million in the corresponding quarter in 2016. The decrease was primarily a result of six renewable energy loss contracts that remained uncompleted as of September 30, 2017.The loss contracts are not expected to contribute any gross profit to the Renewable segment throughout 2017 unless there are revisions to our estimated revenues or costs at completion in future periods.

~~Nine months ended September 30, 2017 vs. 2016~~

Revenues decreased 11% in the nine months ended September 30, 2017 to $262.2 million, compared to $293.6 million in the corresponding nine month period in 2016. The number of contracts and level of activity in the segment during the nine months ended September 30, 2017 and 2016 were comparable. The decrease in revenues in the nine months ended September 30, 2017 is due to the same reasons noted in the three month explanations above.

Gross profit decreased in the nine months ended September 30, 2017 to a loss of $100.1 million, compared to gross profit of $14.5 million in the corresponding nine month period in 2016. Changes in estimates to complete our renewable energy contracts resulted in $123.8 million in charges during the nine months ended September 30, 2017.

See Note 5 in the condensed consolidated financial statements for additional information on the impact of the segment's renewable energy contracts on our results of operations in the third quarters and nine months ended September 30, 2017 and 2016.

~~Industrial~~

Three months ended September 30, Nine months ended September 30,
(In thousands) 2017 2016 $ Change 2017 2016 $ Change
Revenues $ 99,288
$ 76,809
$ 22,479
$ 281,734
$ 147,275
$ 134,459
Gross profit $ 9,461
$ 14,601
$ (5,140 ) $ 34,240
$ 33,506
$ 734
Gross margin % 10 % 19 %

12 % 23 %

~~Three months ended September 30, 2017 vs. 2016~~

Revenues increased 29%, or $22.5 million, to $99.3 million in the third quarter of 2017, compared to $76.8 million in the corresponding quarter in 2016. The increase in revenues in the Industrial segment is attributable to organic growth from new build cooling systems projects, complemented by the acquisition of Universal on January 11, 2017, which added $16.0 million of revenue in the third quarter of 2017.

Gross profit decreased 35%, or $5.1 million, to $9.5 million in the third quarter of 2017, compared to $14.6 million in the corresponding quarter in 2016. The acquisition of Universal contributed $3.3 million of gross profit in the third quarter of 2017. The year-over-year net decrease in gross margin percentage reflects product mix, as new build cooling system projects generally have lower margins than other products and services in the segment. In addition, the Industrial segment's gross profit in the third quarter of 2017 also was affected by productivity issues on new build cooling system projects. The productivity issues caused us to increase project cost estimates and deploy additional resources to complete the projects on time.

~~Nine months ended September 30, 2017 vs. 2016~~

~~Revenues increased~~ ~~91%, or~~ ~~$134.5 million, to~~ ~~$281.7 million~~ in the nine months ended September 30, 2017, compared to $147.3 million in the corresponding nine month period in 2016. The increase in revenues in the Industrial segment is primarily attributable to the July 1, 2016 acquisition of SPIG and the January 11, 2017 acquisition of Universal, which together added $193.1 million of revenue in the nine months ended September 30, 2017. Partially offsetting the increase is a $20.4 million decline in revenues attributable to environmental solutions sales in the United States, primarily in the first half of 2017.

Gross profit increased 2%, or $0.7 million, to $34.2 million in the nine months ended September 30, 2017, compared to $33.5 million in the corresponding nine month period in 2016. The acquisitions of SPIG and Universal contributed $12.6 million of

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~~gross profit in the nine months ended September 30, 2017. The year-over-year decrease in gross margins are attributable to the same reasons discussed in the three month explanations above.~~

Bookings and ~~backlog~~Backlog

Bookings and backlog are our measures of remaining performance obligations under our sales contracts. In addition, we monitor Implied Bookings and Backlog, which are bookings (backlog) plus amounts related to projects that have been awarded to us but are not ~~measures recognized by generally accepted accounting principles.~~fully under contract and/or projects under contract that are not yet fully released for performance. We believe these metrics provide investors, lenders and other users of our financial statements with a leading indicator of future revenues. It is possible that our methodology for determining bookings and backlog may not be comparable to methods used by other companies.

We generally include expected revenue from contracts in our backlog when we receive written confirmation from our customers authorizing the performance of work and committing the customers to payment for work performed. Backlog may not be indicative of future operating results, and ~~projects~~contracts in our backlog may be canceled, modified or otherwise altered by customers. ~~Additionally,~~Backlog can vary significantly from period to period, particularly when large new-build conversion projects or operations and maintenance contracts are booked because they may be fulfilled over multiple years. Because we operate globally, our backlog is also affected by changes in foreign currencies each period. ~~We do not include orders of our unconsolidated joint ventures in backlog.~~

Bookings represent changes to the backlog. Bookings include additions related to ~~our backlog.~~booking new business or increases in project scope, subtractions due to customer cancellations or reductions in scope, changes in estimates that affect selling price and revaluation of backlog denominated in foreign currency. We believe comparing bookings on a quarterly basis or for periods less than one year is less meaningful than for longer periods, and that ~~shorter term~~shorter-term changes in bookings may not necessarily indicate a material trend.


	Three Months Ended March 31,
(in approximate millions)	2024		2023
B&W Renewable	$	60.1	$	78.9
B&W Environmental	43.2		64.8
B&W Thermal	106.5		104.0
Other/eliminations	(2.8)		(0.7)
Bookings	$	207.0	$	247.0

Three months ended September 30, Nine months ended September 30,
(In millions) 2017 2016 2017 2016
Power $122 $198 $476 $623
Renewable 35 (2) 86 124
Industrial 100 70 360 133
Other/eliminations (2) — (40) —
Bookings $255 $266 $881 $880
Implied bookings(1) as of March 31, 2024 and 2023 were as follows:


	Three Months Ended March 31,
(in approximate millions)	2024		2023
B&W Renewable	$	70.2	$	78.9
B&W Environmental	69.8		70.7
B&W Thermal	363.4		108.8
Other/eliminations	(2.8)		(0.7)
Bookings	$	500.6	$	257.7

(1) Implied bookings are bookings plus projects that are awarded or under contract but not fully released for performance. B&W Renewable included $10.1 million in additional implied bookings for the three months ended March 31, 2024. B&W Environmental included $26.6 million and $5.9 million in additional implied bookings for the three months ended March 31, 2024 and 2023, respectively. B&W Thermal included $256.9 million and $4.8 million in additional implied bookings for the three months ended March 31, 2024 and 2023, respectively.

(In approximate millions) September 30, 2017 December 31, 2016 September 30, 2016
Power $482 $618 $668
Renewable 1,064 1,241 1,289
Industrial 317 216 233
Other/eliminations (37) (3) —
Backlog $1,826 $2,072 $2,190

Backlog as of March 31, 2024 and 2023 was as follows:


	As of March 31,
(in approximate millions)	2024		2023
B&W Renewable(1)	$	148.0	$	196.5
B&W Environmental	166.1		172.6
B&W Thermal	209.1		251.6
Other/eliminations	9.6		7.3
Backlog	$	532.8	$	628.0

(1) B&W Renewable backlog above excludes $117.6 millionand $52.9 million as of March 31, 2024 and March 31, 2023 respectively related to O&M contracts that are recognized as disposed.

Implied backlog(1) as of March 31, 2024 and 2023 was as follows:


	As of March 31,
(in approximate millions)	2024		2023
B&W Renewable(2)	$	158.1	$	196.5
B&W Environmental	192.7		178.5
B&W Thermal	466.0		256.3
Other/eliminations	9.6		7.3
Backlog	$	826.4	$	638.6

(1) Implied backlog is backlog plus projects that are awarded or under contract but not fully released for performance. B&W Renewable included $10.1 million in additional implied backlog for the three months ended March 31, 2024. B&W Environmental included $26.6 million and $5.9 million in additional implied backlog for the three months ended March 31, 2024 and 2023, respectively. B&W Thermal included $256.9 million and $4.8 million in additional implied backlog for the three months ended March 31, 2024 and 2023, respectively.

(2) B&W Renewable implied backlog above excludes $117.6 millionand $52.9 million as of March 31, 2024 and March 31, 2023 respectively related to O&M contracts that are recognized as disposed.

Of the backlog at ~~September 30, 2017,~~March 31, 2024, we expect to recognize revenues as follows:


(in approximate millions)	2024		2025		Thereafter		Total
B&W Renewable	$	120.5	$	23.6	$	3.9	$	148.0
B&W Environmental	106.3		40.8		19.0		166.1
B&W Thermal	171.2		32.7		5.2		209.1
Other/eliminations	9.6		—		—		9.6
Expected revenue from backlog	$	407.6	$	97.1	$	28.1	$	532.8

(In approximate millions) 2017 2018 Thereafter Total
Power $155 $157 $170 $482
Renewable 129 232 703 1,064
Industrial 71 246 — 317
Other/eliminations — 6 (43) (37)
Backlog $355 $641 $830 $1,826

Changes in Contract Estimates

~~Goodwill impairment~~During the three months ended March 31, 2024 and 2023, we recognized changes in estimated gross profit related to long-term contracts accounted for on the over time basis, which are summarized as follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Increases in gross profit for changes in estimates for over time contracts	$	6,964	$	5,401
Decreases in gross profit for changes in estimates for over time contracts	(3,891)		(4,243)
Net changes in gross profit for changes in estimates for over time contracts	$	3,073	$	1,158

Non-GAAP Financial Measures

We ~~recorded goodwill impairment charges~~use non-GAAP financial measures internally to evaluate our performance and in making financial and operational decisions. When viewed in conjunction with GAAP results and the accompanying reconciliation, we believe that the presentation of ~~$86.9 million ($85.8 million~~these measures provides investors with greater transparency and a greater understanding of factors affecting our financial condition and results of operations than GAAP measures alone. The presentation of non-GAAP financial measures should not be considered in isolation or as a substitute for the related financial results prepared in accordance with GAAP.

The following discussion of our business segment results of operations includes a discussion of Adjusted EBITDA on a consolidated basis, which is a non-GAAP metric and differs from the most directly comparable GAAP measure. Adjusted EBITDA on a consolidated basis is defined as the sum of the adjusted EBITDA for each of the segments, further adjusted for corporate allocations and research and development costs. At a segment level, the adjusted EBITDA presented below is consistent with the way our chief operating decision maker reviews the results of operations and makes strategic decisions about the business and is calculated as earnings before interest, tax, depreciation and amortization adjusted for items such as gains or losses arising from the sale of non-income producing assets, net pension benefits, restructuring activities, impairments, gains and losses on debt extinguishment, costs related to financial consulting, research and development costs and other costs that may not be directly controllable by segment management and are not allocated to the segment.We present consolidated adjusted EBITDA because we believe it is useful to investors to facilitate comparisons of ~~tax)~~the ongoing, operating performance before corporate overhead and other expenses not attributable to the operating performance of our revenue-generating segments.


	Three Months Ended March 31,
(in thousands)	2024		2023(2)
Net loss	$	(16,791)	$	(12,475)
(Loss) income from discontinued operations, net of tax	(992)		211
Loss from continuing operations	(15,799)		(12,686)
Interest expense, net	12,527		12,543
Income tax expense	1,293		490
Depreciation & amortization	4,409		5,269
EBITDA	2,430		5,616

Benefit plans, net	(96)		109
Loss on asset sales, net	53		937
Stock compensation	1,350		3,227
Restructuring activities and business services transition costs	1,580		960
Settlements and related legal costs, net	(4,087)		(2,463)

Loss on debt extinguishment	5,071		—
Acquisition pursuit and related costs	84		134
Product development (1)	1,619		1,370
Foreign exchange	1,333		461
Financial advisory services	214		—
Contract disposal	585		1,387


Letter of credit fees	2,388		1,643
Other - net	11		193
Adjusted EBITDA	$	12,535	$	13,574

(1) Costs associated with development of commercially viable products that are ready to go to market.

(2) Certain 2023 amounts have been reclassified in the third quarter of 2017, which included a $50.0 million charge in the Renewable reporting unit and a $36.9 million charge in the SPIG reporting unit. The reasons for the charges and related assumptions made by management are described in Note 13reconciliation to conform to the condensed consolidated financial statements. The third quarter 2017 impairment charges eliminated all of the Renewable reporting unit's goodwill balance at September 30, 2017, and $38.0 million of the SPIG reporting unit's goodwill balance remains after the impairment charge; long-lived assets2024 presentation.


	Three Months Ended March 31,
(in thousands)	2024		2023
Adjusted EBITDA
B&W Renewable	$	1,658	$	4,322
B&W Environmental	3,326		1,906
B&W Thermal	13,672		13,733
Corporate	(6,005)		(5,080)
Research and development costs	(116)		(1,307)
	$	12,535	$	13,574

Corporate

Corporate costs in ~~the two reporting units were not impaired.~~

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~~SG&A expenses~~

adjusted EBITDA include SG&A expenses ~~excluding intangible asset amortization expense~~that are not allocated to the reportable segments. These costs include, among others, certain executive, compliance, strategic, reporting and ~~pension mark~~legal expenses associated with governance of the organization and being an SEC registrant. Corporate expenses not allocated to ~~market adjustments, decreased by $0.4~~the reportable segments totaled $6.0 million ~~to $59.2~~and $5.1 million in the third quarter of 2017, as compared to $59.6 million in the third quarter of 2016. The primary reasons for the decrease are the $8.7 million of SG&A savings from our 2016 restructuring focused on the Power segment and $0.5 million lower acquisition and integration costs, partially offset by $4.1 million of increased costs to support ongoing Renewable projects and a $4.7 million increase resulting from the Universal acquisition and other support activities in the Industrial segment.

~~SG&A expenses, excluding intangible asset amortization expense and pension mark to market adjustments, increased by $13.5 million in the nine~~three months ended ~~September 30, 2017~~March 31, 2024 and 2023, respectively. The increase is primarily due to ~~$192.7 million, as compared to $179.2 million in~~ the nine months ended September 30, 2016. SG&A increased by $20.2 million from the SPIG and Universal acquisitions, and $13.3 million to support ongoing Renewable projects, partially offset by $21.9 milliontiming of ~~savings from our 2016 restructuring actions focused on the Power segment.~~expenses incurred for professional fees.

Research and development ~~expenses~~

Our research and development activities are focused on improving our products through innovations to reduce their cost and improve competitiveness and/or reduce performance risk of our products to better meet our and our customers’ expectations.

Research and development expenses totaled $0.1 million and $1.3 million in the three months ended March 31, 2024 and 2023, respectively. In 2024, the focus of our development activities shifted to our BrightLoopTM and ClimateBrightTM portfolio, which is captured in the Product development category.

Benefit plans, net

We recognize benefits from our defined benefit and other postretirement benefit plans based on actuarial calculations primarily because expected return on assets is greater than service cost. Service cost is low because our plan benefits are frozen except for a small number of hourly participants. Pension benefits for defined benefit and other postretirement benefits plans before MTM were a benefit of $0.1 million for the three months ended March 31, 2024 and expense of $0.1 million for the three months ended March 31, 2023, respectively.

Our pension costs include MTM adjustments and are primarily a result of changes in the discount rate, curtailments and settlements. Any MTM charge or gain should not be considered to be representative of future MTM adjustments as such events are not currently predicted and are in each case subject to market conditions and actuarial assumptions as of the date of the event giving rise to the MTM adjustment. There were no MTM adjustments for the three months ended March 31, 2024 or 2023.

Refer to Note 12 to the Condensed Consolidated Financial Statements for further information regarding our pension and other postretirement plans.

Loss on asset sales, net

We, at times, will sell or dispose of certain assets that are unrelated to our operations, therefore, we believe it is useful to exclude these gains and losses from our non-GAAP financial measures in order to highlight the performance of the business. We had $0.1 million and $0.9 million in losses on sales in the three months ended March 31, 2024 and 2023, respectively.

Stock Compensation

The grant date fair value of stock compensation varies based on the derived stock price at the time of grant, valuation methodologies, subjective assumptions, and reward types. This may make the impact of this form of compensation on our current financial results difficult to compare to previous and future periods. Therefore, we believe it is useful to exclude stock-based compensation from our non-GAAP financial measures in order to highlight the performance of the business and to be consistent with the way many investors evaluate our performance and compare our operating results to peer companies.

Expenses related to restricted stock units are recorded at the Corporate level and are recognized on a straight-line basis over a 3-year vesting period, except for market-based restricted stock units which are recognized over a derived service period.

Stock compensation was $1.4 million and $3.2 million for the three months ended March 31, 2024 and 2023, respectively.

Restructuring activities and business service transition costs

Restructuring activities and business services transition actions across our business units and corporate functions resulted in expense of $1.6 million and $1.0 million in the three months ended March 31, 2024 and 2023, respectively. The restructuring charges primarily consist of severance and related costs associated with non-recurring actions taken to transform our operations with impacts on employees and facilities used in our businesses. Business services transition costs relate to new technology implementation, expected to provide future benefit and are included in Selling, general and administrative expenses in the Condensed Consolidated Statement of Operations.

Settlements and related legal costs

Settlements and related legal costs were a benefit of $4.1 million and $2.5 million in the three months ended March 31, 2024 and 2023, respectively. The current year benefit is driven by the favorable final settlement of amounts owed to the former owner of B&W Solar, offset by expenses related to several smaller litigation matters. The benefit in the prior year was driven by a $2.5 million litigation settlement.

Product development

Our product development activities include expenses that relate to sales, marketing, and other business development expenses for products and services still under development and ~~improvement~~not yet widely available. Product development expenses totaled $1.6 million and $1.4 million in the three months ended March 31, 2024 and 2023, respectively. The increase resulted primarily from timing of ~~new~~specific research and ~~existing products~~increased development efforts and ~~equipment,~~activities related to our BrightLoopTM commercialization efforts and to further develop our ClimateBrightTM portfolio. Management excludes these expenses from adjusted EBITDA as ~~well~~they often may not correlate to revenue or other operations occurring in the current period.

Foreign exchange

Foreign exchange was a loss of $1.3 million and $0.5 million for the three months ended March 31, 2024 and 2023, respectively.

We translate assets and liabilities of our foreign operations into U.S. dollars at current exchange rates, and we translate items in the statement of operations at average exchange rates for the periods presented. We record adjustments resulting from the translation of foreign currency financial statements as ~~conceptual~~a component of accumulated other comprehensive income (loss). We report foreign currency transaction gains and ~~engineering evaluation~~losses in the Condensed Consolidated Statements of Operations.

Financial advisory services

We had financial advisory services of $0.2 million in the three months ended March 31, 2024. There were no financial advisory services in 2023.

Contract Disposal

We are in the process of exiting our only remaining fixed fee operational and maintenance ("O&M") contract in our Renewable segment. Losses related to this contract totaled $0.6 million and $1.4 million in the three months ended March 31, 2024 and 2023, respectively. We believe it is useful to exclude the impact of this contract on our operating results in order to highlight the performance of the ongoing business.

Letter of credit fees

Letter of credit fees included in Cost of operations were $2.4 million and $1.6 million for ~~translation into practical applications.~~the three months ended March 31, 2024 and 2023, respectively. Letter of credit fees are routinely incurred in the course of executing customer contracts. A portion of the fees are included in the contract prices with our customers. These ~~expenses were~~amounts represent performance guarantees akin to insurance that are not passed along to our customers and are excluded from adjusted EBITDA as they do not reflect the performance of the business.

Interest Expense

Interest expense in the Condensed Consolidated Financial Statements consisted of the following components:


	Three Months Ended March 31,
(in thousands)	2024		2023
Components associated with borrowings from:
Senior notes	$	6,271	$	6,328

U.S. Revolving Credit Facility	1,532		—
	7,803		6,328
Components associated with amortization or accretion of:
Revolving Credit Agreement	1,149		984
Senior notes	644		619

	1,793		1,603

Components associated with interest from:
Lease liabilities	548		724
LOC interest and fees	2,189		2,822
Other interest expense	501		1,179
	3,238		4,725

Total interest expense	$	12,834	$	12,656

Income Taxes


	Three Months Ended March 31,
(In thousands, except for percentages)	2024			2023			$ Change
Loss before income taxes	$	(14,506)		$	(12,196)		$	(2,310)
Income tax expense	$	1,293		$	490		$	803
Effective tax rate	(8.9)		%	(4.0)		%

Income tax expense in the first quarter of 2024 reflects a full valuation allowance against our net deferred tax assets, except in Mexico, Canada, the United Kingdom, Brazil, Finland, Germany, Thailand, the Philippines, Indonesia, and Sweden. Deferred tax assets are evaluated each period to determine whether realization is more likely than not. Valuation allowances are established when management determines it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. Valuation allowances may be removed in the future if sufficient positive evidence exists to outweigh the negative evidence under the framework of ASC 740, Income Taxes ASC 740.

The effective tax rate for the first quarter of 2024 is not reflective of the United States statutory rate primarily due to a valuation allowance against certain net deferred tax assets and unfavorable discrete items. In certain jurisdictions where we anticipate a loss for the fiscal year or incurs a loss for the year-to-date period for which a tax benefit cannot be realized in accordance with ASC 740, we exclude the loss in that jurisdiction from the overall computation of the estimated annual effective tax rate.

Depreciation and Amortization

Depreciation expense was $2.1 million and $2.9 million in the three months ended March 31, 2024 and 2023, respectively.

Amortization expense was $2.3 million and $2.4 million in the three months ended March 31, 2024 and 2023, respectively.

RESULTS BY SEGMENT

B&W Renewable Segment Results


	Three Months Ended March 31,
(in thousands)	2024		2023		$ Change
Revenues	$	52,281	$	84,123	$	(31,842)
Adjusted EBITDA	$	1,658	$	4,322	$	(2,664)

Three months ended March 31, 2024 and 2023

Revenues in the B&W Renewable segment decreased38% or$31.8 million, to $52.3 million in the three months ended March 31, 2024 compared to $84.1 million in the three months ended March 31, 2023. Consistent with our stated strategy, fewer waste-to-energy projects were performed in the current year as we shift our focus to our higher-margin and lower-risk European Renewable parts and services business, leading to a decrease in revenue of $22.1 million.

Adjusted EBITDA in the B&W Renewable segment decreased $2.7 million, to $1.7 million in the three months ended March 31, 2024 compared to $4.3 million in the three months ended March 31, 2023 driven by a decrease of $3.6 million due to the reduced volume of waste-to-energy projects, partially offset by an increase of $1.1 million attributable to the European Renewable parts and services business.

B&W Environmental Segment Results


	Three Months Ended March 31,
(in thousands)	2024		2023		$ Change
Revenues	$	48,354	$	39,440	$	8,914
Adjusted EBITDA	$	3,326	$	1,906	$	1,420

Three months ended March 31, 2024 and 2023

Revenues in the B&W Environmental segment increased 23%, or $8.9 million to $48.4 million in the three months ended March 31, 2024 compared to $39.4 million in the three months ended March 31, 2023. The increase is primarily driven by higher revenue of $2.0 million in SPIG, our Air-Cooled Condenser business, and $2.1 million in our Allen-Sherman-Hoff ("ASH") ash handling business, as well as slightly increased volume in our parts business.

Adjusted EBITDA in the B&W Environmental segment was $3.3 million in the three months ended March 31, 2024 compared to $1.9 million in the three months ended March 31, 2023. The increase is primarily attributable to the higher revenue from SPIG and ASH projects and improved operating performance as certain environmental projects were completed in the quarter.

B&W Thermal Segment Results


	Three Months Ended March 31,
(In thousands)	2024		2023		$ Change
Revenues	$	110,187	$	119,236	$	(9,049)
Adjusted EBITDA	$	13,672	$	13,733	$	(61)

Three months ended March 31, 2024 and 2023

Revenues in the B&W Thermal segment decreased8%, or $9.0 million to $110.2 million in the three months ended March 31, 2024 compared to $119.2 million in the three months ended March 31, 2023. A large project in our U.S. construction business was active in 2023 and was not fully replaced in 2024, resulting in decreased revenue of $6.2 million.

Adjusted EBITDA in the B&W Thermal segment was unchanged at $13.7 million in the three months ended March 31, 2024 and 2023, as an increase in international sales of $1.6 million was largely offset by the decreased Adjusted EBITDA in the U.S. construction business.

Liquidity and Capital Resources

Liquidity

Our primary liquidity requirements include debt service, funding of dividends on preferred stock and working capital needs. We fund our liquidity requirements primarily through cash generated from operations, external sources of financing, including our Axos Credit Agreement and senior notes, and equity offerings, including the Sales Agreement (as defined below) and our Preferred Stock, each of which are described in the Notes to Condensed Consolidated Financial Statements included in Part I, Item I of this Quarterly Report in further detail.

On April 10, 2024, we entered into a sales agreement (the "Sales Agreement") with B. Riley Securities, Inc., Seaport Global Securities LLC, Craig-Hallum Capital Group LLC and Lake Street Capital Markets, LLC (together, the "Agents"), in connection with the offer and sale from time to time of shares of our common stock, having an aggregate offering price of up to $50.0 million, through the Agents. As of May 3, 2024, 1.5 million shares have been sold pursuant to the Sales Agreement. Refer to Note 22 to the Condensed Consolidated Financial Statement for additional discussion of the ~~quarter ended September 30, 2017 and 2016, respectively, and $7.5~~Sales Agreement.

We have recurring operating losses primarily due to losses recognized on our B&W Solar business as described in Note 4 to the Consolidated Financial Statements included in Part II, Item 8 of our Form 10-K filed on March 15, 2024 as well as higher debt service costs. Our net cash used in operating activities was $14.9 million and ~~$8.3~~$12.9 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2024 and ~~2016,~~2023, respectively. ~~We continuously evaluate each research~~Our assessment of our ability to fund future operations is inherently subjective, judgment-based and ~~development project~~susceptible to change based on future events. Currently, with existing cash on hand and ~~collaborate with our business teams to ensure that we believe~~available liquidity, we are ~~developing technology~~projecting insufficient liquidity to fund operations through one year from the date this Quarterly Report is issued. These conditions and ~~products that are currently desired by the market and will result in future sales.~~events raise substantial doubt about our ability to continue as a going concern.

~~Restructuring~~

~~2017 Restructuring activities~~

In response to the ~~third quarter of 2017~~conditions, we are implementing several strategies to obtain the required funding for future operations, and ~~through the date of this report, we have announced plans to implement restructuring actions~~are considering other alternative measures to improve cash flow, including suspension of the dividend on our ~~global cost structure and increase our financial flexibility.~~Preferred Stock. The ~~restructuring~~following actions ~~include a workforce reduction at both~~occurred during the ~~business segment and corporate levels totaling approximately 9%~~three months ended March 31, 2024:

•entered into advanced negotiations related to the sale of one of our global workforce, SG&A expense reductions and new cost control measures, and office closures and consolidations in non-core geographies. These actions include reduction of approximately 30% of B&W Vølund's workforce, which will right-size its workforce to operate under a new execution model focused on B&W's core boiler, grate and environmental equipment technologies, withnon-strategic businesses. Proceeds from the balance-of-plant and civil construction scope being executed by a partner. We believe the new B&W Vølund business model provides us with a lower risk profile and aligns with our strategy of being an industrial and power equipment technology and solutions provider. Other actions are focused on productivity and efficiency gains to enhance profitability and cash flows, and to mitigate the impact of lower demand in the global coal-fired power market. Total estimated costs associated with these restructuring actions are anticipated to be approximately $20 million, most of which will be recognized in the fourth quarter of 2017, and the estimated annual savingssale are expected to be approximately ~~$45~~$40.0 million ~~in 2018.~~

~~Table of Contents~~

~~Pre-2017 Restructuring activities~~

~~Our series of restructuring activities prior~~ to ~~2017 were intended~~$46.0 million, subject to ~~help us maintain margins, make our costs more variable~~due diligence and ~~allow our business to~~continuing negotiations. We cannot provide any assurances that such transaction will close or that proceeds will not be more ~~flexible. We made~~or less than we anticipate;

•initiated the sale process of certain of our ~~manufacturing costs more volume-variable through the closure~~non-strategic businesses;

•filed for a waiver of manufacturing facilities and development of manufacturing arrangements with third parties. Also, we made our cost of engineering and supply chain more variable by creating a matrix organization capable of delivering products across multiple segments, and developing more volume-variable outsourcing arrangements with our joint venture partners and other third parties to meet fluctuating demand. This new matrix organization and operating model required different competencies and, in some cases, changes in leadership. While primarily applicable to our Power segment, our restructuring actions also benefit the Renewable and Industrial segments to a lesser degree. As demonstrated in our segment gross margin percentages, notwithstanding the challenges in our Renewable segment, we have achieved our objective of maintaining gross margins in the Power segment. Quantification of cost savings, however, is significantly dependent upon volume assumptions that have changed since the restructuring actions were initiated.

On June 28, 2016, we announced actions to restructure our power business in advance of lower projected demand for power generation from coal in the United States. These restructuring actions were primarily in the Power segment. Additionally, we announced leadership changes on December 6, 2016, which included the departure of members of management in our Renewable segment. The costs associated with these restructuring activities totaled $0.4 million and $4.0 million in the third quarter and nine months ended September 30, 2017, respectively, and were primarily related to $0.4 million and $2.4 million of employee severance in the third quarter and nine months ended September 30, 2017, respectively. This comparesminimum contributions to the ~~$1.4 million~~Retirement Plan for Employees of charges in the third quarter and nine months ended September 30, 2016, respectively, which consisted of $0.5 million of employee severance costs, a $0.1 million non-cash impairment of the long-lived assets at B&W's one coal power plant and $0.8 million of costs related to organizational realignment of personnel and processes. We expect additional restructuring charges of up to $0.1 million, primarily related to additional manufacturing facility consolidation initiatives that will extend through the fourth quarter of 2017.

The restructuring initiatives announced prior to 2016 were intended to better position us for growth and profitability. They have primarily been related to facility consolidation and organizational efficiency initiatives. Theses costs were $0.5 million and $0.6 million in the third quarter of 2017 and 2016, respectively. These costs were $1.0 million and $3.8 million in the nine months ended September 30, 2017 and 2016, respectively. We expect nominal additional restructuring charges during the fourth quarter of 2017, primarily related to facility demolition and consolidation activities.

~~Spin-off transaction costs~~

~~Spin-off costs were primarily attributable to employee retention awards directly related to the spin-off from our former parent, The~~ Babcock & Wilcox ~~Company (now known as BWX Technologies, Inc.~~Commercial Operations (the "U.S. Plan")~~. In~~, that if granted, would reduce cash funding requirements in 2024 and would increase contributions annually over the ~~third quarter~~subsequent five-year period. We cannot provide any assurances that such waiver will be granted;

•initiated the process to sell several non-core real estate assets;

•initiated the sale of common shares pursuant to our At-The-Market Offering; and, ~~nine months ended September 30, 2017, we recognized spin-off costs~~

•negotiated the settlement of $0.2 million and $1.0 million, respectively. In the third quarter and nine months ended September 30, 2016, we recognized spin-off costs of $0.4 million and $3.4 million, respectively. In the second quarter of 2017, we disbursed $1.9 million of the accrued retention awards. Approximately $0.5 million of such costs remain, which we expect to be recognized through June 30, 2018.

~~Equity in income (loss) of investees~~

Our primary equity method investees included joint ventures in China and India, each of which manufactures boiler parts and equipment. Excluding the impairment described below, Equity in income of investees in the third quarter of 2017 decreased $1.6 million to $1.2 million from $2.8 million in the third quarter of 2016. The decrease in equity income of investees in the third quarter of 2017 is primarily attributable to winding down the joint venture in India as described in Note 11a liability to the ~~condensed consolidated financial statements~~former owner of B&W Solar at a discount, resulting in future cash savings of $7.2 million..

Based on our ability to raise funds through the actions noted above and ~~to the December 22, 2016 sale~~our Cash and cash equivalents as of all of our interest in our former Australian joint venture, Halley & Mellowes Pty. Ltd. ("HMA"). HMA contributed $0.6 million and $1.5 million to our equity in income of investees in the third quarter of 2016 and the nine months ended September 30, 2016, respectively.

At September 30, 2017, our total investment in equity method investees was $87.4 million, which included a $58.7 million investment in Babcock & Wilcox Beijing Company, Ltd. ("BWBC"). Based in China, BWBC designs, manufactures and sells various power plant boilers and related aftermarket equipment. BWBC has been profitable historically, andMarch 31, 2024, we have ~~determined~~concluded it is probable that ~~no other-than-temporary-impairment has occurred based on~~such actions would provide sufficient liquidity to fund operations for the ~~value~~next twelve months following the date of ~~its cash on hand, long-lived assets and expected future cash flows.~~

~~Table of Contents~~

Our investment in equity method investees also included a investment in TBWES, which has a manufacturing facility intended primarily for new build coal boiler projects in India. During the second quarter of 2017, both we and our joint venture partner decided to make a strategic change in the Indian joint venture due to the decline in forecasted market opportunities in India, which reduced the expected recoverable value of our investment in the joint venture.this Quarterly Report. As a result, it is probable that our cash flow improvement plans and anticipated proceeds from the sale of ~~this strategic change, we recognized~~non-strategic assets alleviate the substantial doubt about our ability to continue as a $18.2 million other-than-temporary-impairment of our investment in TBWES in the second quarter of 2017. The impairment charge was based on the difference in the carrying value of our investment in TBWESgoing concern.

Cash and ~~our share of the estimated fair value of TBWES's net assets. After recording the impairment charge, our remaining investment in TBWES at September 30, 2017 was $26.0 million.~~Cash Flows

We assess our investments in unconsolidated affiliates for other-than-temporary-impairment when significant changes occur in the investee's business or our investment philosophy. Such changes might include a series of operating losses incurred by the investee that are deemed other than temporary, the inability of the investee to sustain an earnings capacity that would justify the carrying amount of the investment or a change in the strategic reasons that were important when we originally entered into the joint venture. If an other-than-temporary-impairment were to occur, we would measure our investment in the unconsolidated affiliate at fair value.

~~Intangible asset amortization expense~~

We recorded $4.0 million and $8.8 million of intangible amortization expense during the third quarters of 2017 and 2016, respectively, and $14.5 million and $11.9 million of expense during the nine months ended September 30, 2017 and 2016, respectively. The increase in amortization expense is attributable to our last two business combinations, which increased our intangible assets by $74.7 million.

We acquired $55.2 million of intangible assets in the July 1, 2016 acquisition of SPIG. Amortization of the SPIG intangible assets resulted in $1.9 million and $7.1 million of expense during the third quarter of 2017 and 2016, respectively, and ~~$7.3 million~~ ~~and $7.1 million of expense during the nine months ended September 30, 2017 and 2016, respectively.~~

We acquired $19.5 million of intangible assets in the January 11, 2017 acquisition of Universal. Amortization of the Universal intangible assets resulted in $0.5 million in the third quarter of 2017 and $2.6 million of expense during the nine months ended September 30, 2017.

~~We expect total intangible amortization expense of $3.6 million in the fourth quarter of 2017.~~

~~Market to market adjustments~~

During the first quarter of 2017, lump sum payments from our Canadian pension plan resulted in a plan settlement of $0.4 million, which also resulted in interim mark to market accounting for the pension plan. The mark to market adjustment in the first quarter of 2017 was $0.7 million. The effect of these charges and mark to market adjustments are reflected in the $1.1 million "~~Recognized net actuarial loss." There were no significant plan settlements or interim mark to market adjustments during the second or third quarters of 2017.~~

During the second and third quarters of 2016, we recorded adjustments to our benefit plan liabilities resulting from certain curtailment and settlement events. In September 2016, lump sum payments from our Canadian pension plan resulted in a $0.1 million pension plan settlement charge. In May 2016, the closure of our West Point, Mississippi manufacturing facility resulted in a $1.8 million curtailment charge in our United States pension plan. In April 2016, lump sum payments from our Canadian pension plan resulted in a $1.1 million plan settlement charge. These events resulted in interim mark to market accounting for the respective benefit plans in 2016. Mark to market charges in the three months ended September 30, 2016 were $0.5 million in our Canadian pension plan. Mark to market charges for our United States and Canadian pension plans were $27.5 million in the nine months ended September 30, 2016. The pension mark to market charges were impacted by higher than expected returns on pension plan assets. The weighted-average discount rate used to remeasure the benefit plan liabilities at September 30, 2016 was 3.88%. The effect of these charges and mark to market adjustments are reflected in the "Recognized net actuarial loss."

~~Table of Contents~~

~~Provision for income taxes~~

Three months ended September 30, Nine months ended September 30,
(In thousands) 2017 2016 $ Change 2017 2016 $ Change
Income (loss) before income taxes $ (119,728 ) $ 10,628
$ (130,356 ) $ (279,424 ) $ (44,586 ) $ (234,838 )
Income tax expense (benefit) $ (5,639 ) $ 1,617
$ (7,256 ) $ (7,644 ) $ (790 ) $ (6,854 )
Effective tax rate 4.7 % 15.2 % 2.7 % 1.8 %

We operate in numerous countries that have statutory tax rates below that of the United States federal statutory rate of 35%. The most significant of these foreign operations are located in Canada, Denmark, Germany, Italy, Mexico, Sweden and the United Kingdom with effective tax rates ranging between 19% and approximately 30%. In addition, the jurisdictional mix of our income (loss) before tax can be significantly affected by mark to market adjustments related to our pension and postretirement plans, which have been primarily in the United States, and the impact of discrete items.

~~Income (loss) before the provision for income taxes generated in the United States and foreign locations for the quarters ended September 30, 2017 and 2016 is presented in the table below.~~

Three months ended September 30, Nine months ended September 30,
(In thousands) 2017 2016 2017 2016
United States $ (3,653 ) $ 8,831
$ (41,070 ) $ (20,611 )
Other than United States (116,075 ) 1,797
(238,354 ) (23,975 )
Income (loss) before income taxes $ (119,728 ) $ 10,628
$ (279,424 ) $ (44,586 )

~~See Note 7 to the condensed consolidated financial statements for explanation of differences between our effective income tax rate and our statutory rate.~~

~~Liquidity and capital resources~~

At ~~September 30, 2017, our~~March 31, 2024, cash and cash equivalents, current restricted cash and long-term restricted cash totaled ~~$48.1~~$102.5 million, ~~and we had $209.7~~which included $58.6 million of restricted cash related to collateral for certain letters of credit. We had total ~~borrowings ($247.2~~debt of $441.6 million ~~face value before debt discounts).~~as well as $191.7 million of gross preferred stock outstanding. Our foreign business locations held $25.9 million of our total unrestricted cash and cash equivalents at March 31, 2024. In general, our foreign cash balances are not available to fund our ~~United States~~U.S. operations unless the funds are repatriated or used to repay intercompany loans made from the ~~United States~~U.S. to foreign entities, which could expose us to taxes we ~~presently~~ have not made a provision for in our results of operations. ~~$44.8 million of our $48.1 million of unrestricted cash and cash equivalents at September 30, 2017 was held by foreign entities.~~ We presently have no plans to repatriate these funds to the ~~United States as we believe that our United States liquidity is sufficient to meet the anticipated cash requirements of our United States operations.~~

Historically, our primary sources of liquidity have been cash from operations, borrowings under our United States revolving credit facility and borrowings under foreign revolving credit facilities. Our borrowing capacity under our United States revolving credit facility is primarily limited by the financial covenants, which are most significantly affected by our trailing 12 months EBITDA (as defined in the credit agreement governing the facility). The significant loss accruals we recorded in the second quarter of 2017 and the fourth quarter of 2016 reduced our trailing 12 months EBITDA and, in turn, our ability to comply with our financial covenants. Accordingly, we amended our credit agreement in February 2017 and August 2017 to, among other things, provide covenant relief.

To provide additional liquidity, we entered into a second lien term loan facility on August 9, 2017 with an affiliate of American Industrial Partners ("AIP"). The second lien term loan facility consists of a second lien term loan in the principal amount of $175.9 million, all of which we borrowed on August 9, 2017, and a delayed draw term loan in the principal amount of $20.0 million, which may be drawn in a single draw prior to June 30, 2020, subject to certain conditions. On August 9, 2017, we used $125.0 million of the second lien term loan proceeds to repay borrowings outstanding under our United States revolving credit facility and pay fees and expenses related to the second lien term loan facility and the amendment of our United States revolving credit facility. The balance of the second lien term loan proceeds were used to repurchase approximately 4.8 million shares of our common stock held by an affiliate of AIP for approximately $50.9 million, which was one of the conditions precedent for the second lien term loan facility. As described in Note 18 to the

U.S.

~~Table of Contents~~

condensed consolidated financial statements, the difference between the price paid for the shares and the estimated fair value of the shares repurchased was treated as a debt discount together with the direct financing costs.

We had approximately $94.7 million of availability under our United States revolving credit facility as of September 30, 2017. Based on the amended United States revolving credit and second lien term loan facilities, we believe we have adequate sources of liquidity at September 30, 2017 to meet our cash requirements. Our assessment is based on our operating forecast, backlog, cash on-hand, borrowing capacity, planned capital investments and ability to manage future discretionary cash outflows during the next 12 month period. We expect our operations to use cash over the full year of 2017 and into the first half of 2018, particularly in the Renewable segment, as we fund contract losses and work down advanced bill positions. Our forecasted use of cash over the next 12 months is expected to be funded in part through borrowings from our United States revolving credit facility. Our United States revolving credit facility allows for nearly immediate borrowing of available capacity to fund cash requirements in the normal course of business, meaning that the minimum United States cash on hand is maintained to minimize borrowing costs. After giving effect to the $50.0 million of unrestricted cash on hand required under our financial covenants, we expect to have between $73.0 million and $173.0 million of available borrowing capacity from our United States revolving credit facility during the next 12 months based on our forecast of the trailing 12 month EBITDA calculation and forecasted borrowings. We expect cash and cash equivalents, cash flows from operations, and our borrowing capacity under our United States revolving credit facility and second lien term loan facility to be sufficient to meet our liquidity needs for at least 12 months from the date of this filing.

~~Our net cash~~Cash used in operations was ~~$150.8~~$14.9 million in the ~~nine~~three months ended ~~September 30, 2017, compared~~March 31, 2024, which is primarily attributable to ~~cash~~the year-to-date net loss of $16.8 million. Cash used in operations ~~of $39.8~~was $12.9 million in the ~~nine~~three months ended ~~September 30, 2016. The change is partially attributable~~March 31, 2023, which was primarily attributed to the ~~$228.3 million increase in our~~year-to-date net loss in the nine months ended September 30, 2017 compared to the nine months ended September 30, 2016. Also, a $13.0 million net decrease in cash outflows associated with changes in accounts receivable, contracts in progress and advanced billings in the nine months ended September 30, 2017 compared to the nine months ended September 30, 2016 resulted primarily from the timing of billings and stage of completion of large, ongoing contracts in our Renewable segment. Generally, we try to structure contract milestones to mirror our expected cash outflows over the course of the contract; however, the timing of milestone receipts can greatly affect our overall cash position. Our portfolio of Renewable energy contracts at both September 30, 2017 and December 31, 2016 included milestone payments from our customers in advance of incurring the contract expenses, and as a result we are in an advance bill position on most of these contracts at both dates. Because of the advanced bill positions, combined with the increase in expected costs to complete the Renewable loss contracts, we expect the use of cash by the Renewable segment to continue during 2017 and into the first half of 2018 until these contracts are completed. Partially offsetting these operating cash outflows was a $25.6 million decrease in operating cash outflows associated with changes in contract related accounts payable and accrued liabilities in the nine months ended September 30, 2017 compared to the nine months ended September 30, 2016.$12.5 million.

~~Our net cash~~Cash flows used in investing activities was ~~$57.9~~$2.8 million and $2.2 million in the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2024 and ~~$191.6 million in the nine months ended September 30, 2016. The net cash used in investing activities was~~2023, respectively, primarily ~~attributable~~due to the $52.5 million acquisition of Universal on January 11, 2017, net of $4.4 million cash acquired in the business combination (see Note 4 to the condensed consolidated financial statements). The net cash used in investing activities in the nine months ended September 30, 2016 included $143.0 million acquisition of SPIG, net of $26.0 million cash acquired, and a $26.2 million contribution to increase our interest in TBWES, our joint venture in India. Capital expenditures were $10.7 million and $20.4 million in the nine months ended September 30, 2017 and 2016, respectively.capital expenditures.

~~Our net cash~~Cash flows provided by financing activities ~~was $155.5~~of $51.3 million in the ~~nine~~three months ended ~~September 30, 2017, compared~~March 31, 2024, primarily due to ~~$64.6 million of cash used in the nine months ended September 30, 2016. The cash provided by financing activities in the nine months ended September 30, 2017 was a result of~~ net borrowings ~~from our United States revolving credit facility~~on the Axos Credit Agreement of ~~$49.1~~$61.6 million, ~~which were used to fund our working capital needs and~~offset by the ~~Universal acquisition. In addition, cash provided by financing activities in the nine months ended September 30, 2017 included proceeds from the issuance~~payment of ~~the second lien term loan~~preferred dividend of ~~$141.7 million, which were used to repurchase $16.7 million of shares from a related party, fund debt issuance costs and repay a portion of our United States revolving credit facility. The net cash~~$3.7 million. Cash flows used in financing activities was $5.9 million in the ~~nine~~three months ended ~~September 30, 2016 is~~March 31, 2023, primarily ~~attributable~~due to ~~repurchases~~the payment of ~~$78.4~~the preferred stock dividend of $3.7 million and loan repayments of ~~our common stock.~~$1.7 million.

Debt Facilities

~~Table~~As discussed in Note 13 to the Condensed Consolidated Financial Statements included in Item 1 of ~~Contents~~

~~United States revolving credit facility~~

~~On May 11, 2015,~~this Quarterly Report, we entered into a ~~credit agreement with a syndicate of lenders ("Credit Agreement") in connection with our spin-off from The Babcock & Wilcox Company. The~~new Credit Agreement ~~which is scheduled~~with Axos in January 2024. B. Riley, a related party, has provided a guaranty of payment with regard to ~~mature on June 30, 2020, provides for a senior secured revolving credit facility, initially in an aggregate amount of up to $600 million. The proceeds of loans~~our obligations under the Credit Agreement. This agreement substantially replaces the existing Reimbursement Agreement, ~~are available for working capital needs and other general corporate purposes, and the full amount is available to support the issuance of letters of credit.~~

~~On February 24, 2017 and August 9, 2017, we entered into amendments to the~~Revolving Credit Agreement ~~(the “Amendments”~~ and ~~the~~Letter of Credit Agreement, as amended to date, the “Amended Credit Agreement”) to, among other things: (1) permit us to incur the debt under the second lien term loan facility, (2) modify the definition of EBITDA in the Amended Credit Agreement to exclude: up to $98.1 million of charges for certain Renewable segment contracts for periods including the quarter ended December 31, 2016, up to $115.2 million of charges for certain Renewable segment contracts for periods including the quarter ended June 30, 2017, up to $4.0 million of aggregate restructuring expenses incurred during the period from July 1, 2017 through September 30, 2018 measured on a consecutive four-quarter basis, realized and unrealized foreign exchange losses resulting from the impact of foreign currency changes on the valuation of assets and liabilities, and fees and expenses incurred in connection with the August 9, 2017 amendment, (3) replace the maximum leverage ratio with a maximum senior debt leverage ratio, (4) decrease the minimum consolidated interest coverage ratio, (5) limit our ability to borrow under the Amended Credit Agreement during the covenant relief period to $250.0 million in the aggregate, (6) reduce commitments under the revolving credit facility from $600.0 million to $500.0 million, (7) require us to maintain liquidity (as defined in the Amended Credit Agreement) of at least $75.0 million as of the last business day of any calendar month, (8) require us to repay outstanding borrowings under the revolving credit facility (without any reduction in commitments) with certain excess cash, (9) increase the pricing for borrowings and commitment fees under the Amended Credit Agreement, (10) limit our ability to incur debt and liens during the covenant relief period, (11) limit our ability to make acquisitions and investments in third parties during the covenant relief period, (12) prohibit us from paying dividends and undertaking stock repurchases during the covenant relief period (other than our share repurchase from an affiliate of AIP), (13) prohibit us from exercising the accordion described below during the covenant relief period, (14) limit our financial and commercialAgreement. We are transitioning letters of credit outstanding under the ~~Amended~~Letter of Credit Agreement and Reimbursement Agreement to the Axos Credit Agreement. We believe all outstanding letters of credit will be transitioned to the Axos Credit Agreement by June 30, 2024, at which time the Letter of Credit Agreement and Reimbursement Agreement is expected to be terminated.

On April 30, 2024, we, along with certain subsidiaries as guarantors, the lenders party to the Credit Agreement , and Axos, as administrative agent, entered into the First Amendment to Credit Agreement (the “First Amendment”). The First Amendment, among other things, amends the terms of the Credit Agreement to ~~$30.0 million during~~increase the ~~covenant relief period, (15) require us~~amounts available to reduce commitments under the Amended Credit Agreement with the proceeds of certain debt issuances and asset sales, (16) beginning with the quarter ended September 30, 2017, limit to no more than $25.0 million any cumulative net income losses attributable to certain Vølund projects, and (17) increase reporting obligations and require us to hire a third-party consultant. The covenant relief period will end, at our election, when the conditions set forthbe borrowed based on inventory in the ~~Amended Credit Agreement are satisfied, but in no event earlier than the date on which we provide the compliance certificate for our fiscal quarter ended December 31, 2018.~~

Other than during the covenant relief period, the Amended Credit Agreement contains an accordion feature that allows us, subject to the satisfaction of certain conditions, including the receipt of increased commitments from existing lenders or new commitments from new lenders, to increase the amount of the commitmentsborrowing base under the revolving credit facility in an aggregate amount not to exceed the sum of (1) $200.0 million plus (2) an unlimited amount, so long as for any commitment increase under this subclause (2) our senior leverage ratio (assuming the full amount of any commitment increase under this subclause (2) is drawn) is equal to or less than 2.0:1.0 after giving pro forma effect thereto. During the covenant relief period, our ability to exercise the accordion feature will be prohibited.

After giving effect to Amendments, loans outstanding under the Amended Credit Agreement bear interest at our option at either (1) the LIBOR rate plus 5.0% per annum or (2) the base rate (the highest of the Federal Funds rate plus 0.5%, the one month LIBOR rate plus 1.0%, or the administrative agent's prime rate) plus 4.0% per annum. A commitment fee of 1.0% per annum is charged on the unused portions of the revolving credit facility. A letter of credit fee of 2.50% per annum is charged with respect to the amount of each financial letter of credit outstanding, and a letter of credit fee of 1.50% per annum is charged with respect to the amount of each performance and commercial letter of credit outstanding. Additionally, an annual facility fee of $1.5 million is payable on the first business day of 2018 and 2019, and a pro rated amount is payable on the first business day of 2020.

The Amended Credit Agreement includes financial covenants that are tested on a quarterly basis, based on the rolling four-quarter period that ends on the last day of each fiscal quarter. The maximum permitted senior debt leverage ratio as defined in the Amended Credit Agreement is:

~~6.00:1.0 for the quarter ended September 30, 2017,~~

~~8.50:1.0 for each of the quarters ending December 31, 2017 and March 31, 2018,~~

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~~6.25:1.0 for the quarter ending June 30, 2018,~~

~~4.00:1.0 for the quarter ending September 30, 2018,~~

~~3.75:1.0 for the quarter ending December 31, 2018,~~

~~3.25:1.0 for each of the quarters ending March 31, 2019 and June 30, 2019, and~~

~~3.00:1.0 for each of the quarters ending September 30, 2019 and each quarter thereafter.~~

~~The minimum consolidated interest coverage ratio as defined in~~ the Credit Agreement ~~is:~~(the "Increased Inventory Period"). In 2024, the Increased Inventory Period commences on April 30 and ends on July 31 and would provide approximately $6.0 million additional available borrowings under the Credit Agreement. The Increased Inventory Period is available to us upon our election in subsequent years (subject to a $75,000 fee if we make such an election), and commences on March 1 and ends on July 31.

~~1.50:1.0 for the quarter ended September 30, 2017,~~

~~1.00:1.0 for each of the quarters ending December 31, 2017 and~~At March 31, ~~2018,~~

~~1.25:1.0 for the quarter ending June 30, 2018,~~

~~1.50:1.0 for each of the quarters ending September 30, 2018 and December 31, 2018,~~

~~1.75:1.0 for each of the quarters ending March 31, 2019 and June 30, 2019, and~~

~~2.00:1.0 for each of the quarters ending September 30, 2019 and each quarter thereafter.~~

~~Beginning with September 30, 2017, consolidated capital expenditures in each fiscal year are limited to $27.5 million.~~

~~At September 30, 2017,~~2024, usage under the ~~Amended~~Credit Agreement and Letter of Credit Agreement consisted of ~~$58.9 million in borrowings at an effective interest rate of 6.88%, $7.7~~$11.5 million of financial letters of credit and ~~$87.2~~$68.1 million of performance letters of ~~credit. At September 30, 2017, we had approximately $94.7 million available for borrowings or to meet letter of~~ credit requirements primarily based on trailing 12 month EBITDA, and our leverage (as defined in the Amended Credit Agreement) ratio was 3.00 and our interest coverage ratio was 2.59. In addition, through September 30, 2017, we have used $11.6 million of the $25.0 million of permitted net income loss attributable to Vølund projects. At September 30, 2017, we were in compliance with all of the covenants set forth in the Amended Credit Agreement, and we forecast our compliance with the financial covenants to be closest to the minimum thresholds at March 31, ~~2018.~~2024.

~~We plan to execute the actions necessary to enable us to maintain compliance with the financial~~Letters of Credit, Bank Guarantees and other covenants described above. We believe we will accomplish our plans to maintain compliance with our financial and other covenants, and believe our cash on hand, proceeds from potential future asset sales, cash flows from operations and amounts available under our United States revolving credit facility will be adequate to enable us to fund our operations. However, there can be no assurance that we will be successful. Our ability to generate cash flows from operations, access funding under reasonable terms, contract business with reasonable terms and conditions and comply with our financial and other covenants may be impacted by a variety of business, economic, regulatory and other factors, which may be outsideSurety Bonds

Certain of our ~~control. Such factors include, but~~subsidiaries, that are not limited to: our ability to access capital markets and complete asset dispositions, delay or cancellation of projects, decreased profitability on our projects due to matters not reasonably forecasted, changes in the timing of cash flows on our projects due to the timing of receipts and required payments of liabilities and funding of our loss projects, the timing of approval or settlement of change orders and claims, changes in foreign currency exchange or interest rates, performance of pension plan assets or changes in actuarially determined liabilities. In addition, we could be impacted if our customers experience a material change in their ability to pay us or if the banks associated with our lending facilities were to cease or reduce operations. Also, we have what we believe is adequate capacity to provide letters of credit and secure surety bonds in support of current and future projects, but there can be no assurance that these will be renewed or available at reasonable commercial terms in the future.

~~Second lien term loan~~

On August 9, 2017, we entered into a second lien credit agreement (the "Second Lien Credit Agreement") with an affiliate of AIP governing a second lien term loan facility. The second lien term loan facility consists of a second lien term loan in the principal amount of $175.9 million, all of which we borrowed on August 9, 2017, and a delayed draw term loan facility in the principal amount of up to $20.0 million, which may be drawn in a single draw prior to June 30, 2020, subject to certain conditions. Borrowings under the second lien term loan, other than the delayed draw term loan, bear interest at 10% per annum, and borrowings under the delayed draw term loan bear interest at 12% per annum, in each case payable quarterly. Undrawn amounts under the delayed draw term loan accrue a commitment fee at a rate of 0.50% per annum. The second lien term loan has a scheduled maturity of December 30, 2020. Any delayed draw borrowings would also have a scheduled maturity of December 30, 2020. In connection with our entry into the second lien term loan facility, we used a portion of the proceeds from the second lien term loan to repurchase approximately 4.8 million shares of our common stock (approximately 10% of our shares outstanding) held by an affiliate of AIP for approximately $50.9 million, which was one of the conditions precedent for the second lien term loan facility.

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Borrowings under the Second Lien Credit Agreement are (1) guaranteed by substantially all of our wholly owned domestic subsidiaries, but excluding our captive insurance subsidiary, and (2) secured by second-priority liens on certain assets owned by us and the guarantors. The Second Lien Credit Agreement requires interest payments on loans on a periodic basis until maturity. Voluntary prepayments made during the first year after closing are subject to a make-whole premium, voluntary prepayments made during the second year after closing are subject to a a 3.0% premium and voluntary prepayments made during the third year after closing are subject to a 2.0% premium. The Second Lien Credit Agreement requires us to make certain prepayments on any outstanding loans after receipt of cash proceeds from certain asset sales or other events, subject to certain exceptions and a right to reinvest such proceeds in certain circumstances, and subject to certain restrictions contained in an intercreditor agreement among the lenders under the Amended Credit Agreement and the Second Lien Credit Agreement.

The Second Lien Credit Agreement contains representations and warranties, affirmative and restrictive covenants, financial covenants and events of default substantially similar to those contained in the Amended Credit Agreement, subject to appropriate cushions. The Second Lien Credit Agreement is generally less restrictive than the Amended Credit Agreement.

~~Foreign revolving credit facilities~~

~~Outside~~primarily outside of the United States, we have revolving credit facilities in Turkey, China and India that are used to provide working capital to our operations in each country. These three foreign revolving credit facilities allow us to borrow up to $14.8 million in aggregate and each have a one year term. At September 30, 2017, we had $12.4 million in borrowings outstanding under these foreign revolving credit facilities at an effective weighted-average interest rate of 5.17%.

~~Other credit arrangements~~

~~Certain subsidiaries~~ have credit arrangements with various commercial banks and other financial institutions for the issuance of letters of credit and bank guarantees in ~~associated~~association with contracting activity. The aggregate value of all such letters of credit and bank guarantees ~~not secured by the United States revolving credit facility~~outside of our Letter of Credit Agreement as of ~~September 30, 2017 and December~~March 31, ~~2016~~2024 was ~~$279.1~~$39.0 million. The aggregate value of the outstanding letters of credit provided under the Letter of Credit Agreement backstopping letters of credit or bank guarantees was $17.2 million ~~and $255.2~~as of March 31, 2024. Of the outstanding letters of credit issued under the Letter of Credit Agreement, $48.0 million ~~respectively.~~are subject to foreign currency revaluation.

We have posted surety bonds to support contractual obligations to customers relating to certain ~~projects.~~contracts. We utilize bonding facilities to support such obligations, but the issuance of bonds under those facilities is typically at the surety's discretion. Although there can be no assurance that we will maintain our surety bonding capacity, we believe our current capacity is more than adequate to support our existing project requirements for the next 12 months. In addition, theseThese bonds generally indemnify customers should we fail to perform our obligations under ~~the~~our applicable contracts. We, and certain of our subsidiaries, have jointly executed general agreements of indemnity in favor of surety underwriters relating to surety bonds ~~those~~the underwriters issue in support of some of our contracting activity. As of ~~September 30, 2017,~~March 31, 2024, bonds issued and outstanding under these arrangements in support of contracts totaled approximately ~~$472.3~~$146.8 million. The aggregate value of the letters of credit backstopping surety bonds was $15.3 million.

Our ability to obtain and maintain sufficient capacity under our current debt facilities is essential to allow us to support the issuance of letters of credit, bank guarantees and surety bonds. Without sufficient capacity, our ability to support contract security requirements in the future will be diminished.

Other Indebtedness - Loans Payable

As of March 31, 2024, we had loans payable of $103.2 million, net of debt issuance costs of $0.5 million, of which $4.5 million is classified as current, and $98.7 million as long-term loans payable on the Consolidated Balance Sheet. This includes $90.1 million on the revolving debt facilities, which is comprised of $36.8 million drawn on the revolving credit portion of the facility and $53.3 million drawn on the letter of credit portion, and $12.1 million, net of debt issuance costs of $0.5 million, related to sale-leaseback financing transactions.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

For a summary of the critical accounting policies and estimates that we use in the preparation of our unaudited ~~condensed consolidated financial statements,~~Condensed Consolidated Financial Statements, see "Critical Accounting ~~Policies"~~Policies and Estimates" in ~~our~~the Annual ~~Report.~~Report on Form 10-K for the year ended December 31, 2023. There have been no significant changes to our policies during the ~~quarter~~three months ended ~~September 30, 2017.~~March 31, 2024 from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2023.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our ~~exposures~~exposure to market risks ~~could change~~has not changed materially from those disclosed under "Quantitative and Qualitative Disclosures About Market Risk" in ~~our~~the Annual Report. Our exposure to market risk from changes in interest rates relates primarily to our cash equivalents and our investment portfolio, which primarily consists of investments in United States Government obligations and highly liquid money market instruments denominated in United States dollars. We are averse to principal loss and seek to ensureReport on Form 10-K for the ~~safety and preservation of our invested funds by limiting default risk, market risk and reinvestment risk. Our investments are classified as available-for-sale.~~year ended December 31, 2023.

Although the condensed and consolidated balance sheets do not present debt at fair value, our second lien term loan facility is fixed-rate debt, the fair value of which could fluctuate as a result of changes in prevailing market rates. On September 30, 2017, its principal balance was $175.9 million. Our United States revolving credit facility is variable-rate debt, so its fair

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~~value would not be significantly affected by changes in prevailing market rates. On September 30, 2017, its principal balance was $58.9 million.~~

We have operations in many foreign locations, and, as a result, our financial results could be significantly affected by factors such as changes in foreign currency exchange ("FX") rates or weak economic conditions in those foreign markets. Our primary foreign currency exposures are Danish kroner, Great British pound, Euro, Canadian dollar, and Chinese yuan. In order to manage the risks associated with FX rate fluctuations, we attempt to hedge those risks with FX derivative instruments, but there can be no assurance that such instruments will be available to us on reasonable terms. Historically, we have hedged those risks with FX forward contracts. We do not enter into speculative derivative positions. During the third quarter of 2017, our hedge counterparties removed the lines of credit supporting new FX forward contracts. Subsequently, we have not entered into any new FX forward contracts.

Item 4. Controls and Procedures

Disclosure ~~controls~~Controls and ~~procedures~~Procedures

As of the end of the period covered by this report, ~~the Company's~~our management, with the participation of our Chief Executive Officer and the Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as(as that term is defined in Rules 13a-15(e) and 15d-15(e) ofadopted by the Securities and Exchange Commission under the Securities Exchange Act, ~~of 1934,~~ as amended (the "Exchange Act")). ~~Disclosure controls~~

Based on this evaluation and procedures are the controls and processes that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is accumulated and communicated to management, as appropriate, to allow timely decisions regarding required disclosures. Our disclosure controls and procedures were developed through a process in which our management applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding the control objectives. The design of any system of disclosure controls and procedures is based in part upon various assumptions about the likelihood of future events, and we cannot provide absolute assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

On January 11, 2017, we acquired Universal, which would have represented approximately 3% of our total consolidated assets and consolidated revenues as of and for the year ended December 31, 2016, respectively. As the acquisition occurred during the last 12 months, the scope of our assessmentbecause of the ~~effectiveness of disclosure controls and procedures does not include~~previously-reported material weaknesses in internal control over financial reporting, related to Universal. This exclusion is in accordance with the SEC's general guidance that an assessment of a recently acquired business may be omitted from our internal control over financial reporting scope in the year of acquisition.

~~Based on the evaluation referred to above,~~ our Chief Executive Officer and Chief Financial Officer concluded ~~the~~that our disclosure controls and procedures were not effective ~~due~~as of March 31, 2024.

Notwithstanding the conclusion by our Chief Executive Officer and Chief Financial Officer that our disclosure controls and procedures as of March 31, 2024 were not effective, our management, including our Chief Executive Officer and Chief Financial Officer, has concluded that the Condensed Consolidated Financial Statements as of and for the three months ended March 31, 2024 and 2023 present fairly, in all material respects, our financial position, results of operations and cash flows in conformity with GAAP.

Remediation Plan and Status

As of March 31, 2024, the material weaknesses previously disclosed have not yet been remediated. In response to the material ~~weakness~~weaknesses in our internal control over financial reporting, ~~that we reported for the quarter ended June 30, 2017 at Vølund, a business unit within our Renewable segment, which remains unremediated as of September 30, 2017. Our~~ management has ~~completed all steps designed~~initiated remediation efforts, which includes:

•continuing to ~~remediate~~hire qualified accounting professionals;

•developing and providing additional training to the accounting and financial reporting team;

•designing and implementing additional and/or enhanced controls in the areas of account reconciliations, contract accounting, financial statement analysis and complex and/or non-routine transactions;

•enhancing controls over IT user access and segregation of duties; and,

•developing and implementing a monitoring program to evaluate and assess whether controls are present and functioning appropriately.

We will continue to work towards full remediation of the material ~~weakness at September 30, 2017; however, the~~weaknesses to improve our internal control over financial reporting. The material ~~weakness at Vølund cannot~~weaknesses will not be considered remediated until the new ~~processes~~ and ~~procedures have been in place~~redesigned controls operate for a sufficient period of time and management has ~~determined~~concluded, through testing, that ~~the~~these controls are ~~effective. Management expects~~designed and operating effectively. Accordingly, we will continue to monitor and evaluate the ~~material weakness at Vølund will be remediated at December 31, 2017; however, our remediation plans cannot guarantee the material weakness will be remediated by a specific future date or at all.~~

~~We are committed to continuing to improve~~effectiveness of our internal control over financial reporting and will continue to review our financial reporting processes and internal controls at Vølund. As we continue to evaluate and work to improve our internal control over financial reporting, we may identify additional measures to addressin the areas affected by the material weakness at Vølund. Our management, with the oversight of the audit and finance committee of our board of directors, will continue to assess and take steps to enhance the overall design and capability of our control environment in the future.weaknesses.

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Changes in ~~internal control over financial reporting~~Internal Control Over Financial Reporting

During the three months ended September 30, 2017, we finalized the implementation of a new financial consolidation, planning and reporting system. The new system replaces the legacy system we used under a service agreement with our former Parent. In connection with the implementation, we updated the processes that constitute our internal control over financial reporting, as necessary, to accommodate relatedThere were no changes to our accounting procedures and business processes. Although the processes that constitute our internal control over financial reporting have been affected by the system implementation, we do not believe the implementation of the financial consolidation, planning and reporting system has had or will have a material adverse effect on ourin internal control over financial reporting (as defined inby Rule 13a-15(f) and 15d-15(f) under the Exchange Act). Management has taken steps to ensure that appropriate internal controls are designed and implemented. The new system and associated internal controls were subject to testing and data reconciliation during implementation.

~~Other than the system change described above, there were no changes in our internal control over financial reporting~~ during the quarter ended ~~September 30, 2017~~March 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations in Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures, or our internal controls, will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of simple error or mistake or fraud. Additionally, controls can be circumvented by individuals or groups of persons or by an unauthorized override of the controls. Accordingly, because of the inherent limitations in our control system, misstatements in our public reports due to error or fraud may occur and not be detected.

PART II ~~- OTHER INFORMATION~~

Item 1. Legal Proceedings

For information regarding ongoing investigations and litigation, see Note 1917 to the ~~unaudited condensed consolidated financial statements~~Condensed Consolidated Financial Statements included in Part I, Item I of this ~~report,~~Quarterly Report, which we incorporate by reference into this Item.

Item 1A. Risk Factors

We are subject to various risks and uncertainties in the course of our business. The discussion of such risks and uncertainties may be found under ~~"Risk Factors"~~“Risk Factors” in ~~our~~the Annual ~~Report.~~Report on Form 10-K for the fiscal year ended December 31, 2023. There have been no material changes to ~~such~~the risk ~~factors.~~factors set forth in the Annual Report on Form 10-K for the year ended December 31, 2023.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In ~~August 2015,~~accordance with the provisions of the employee benefit plans, we ~~announced~~acquire shares in connection with the vesting of employee restricted stock that ~~our Board of Directors authorized a share repurchase program. The following table provides information on our purchases of equity securities during~~require us to withhold shares to satisfy employee statutory income tax withholding obligations. During the quarter ended ~~September 30, 2017. Any~~March 31, 2024, we did not have any repurchases of shares ~~purchased that were not part of a publicly announced plan or program are~~ related to ~~repurchases of common~~employee restricted stock ~~pursuant to the provisions of employee benefit plans that permit the~~plans. Also, we do not have a general share repurchase ~~of shares to satisfy statutory tax withholding obligations.~~program at this time.

Period
Total number of shares purchased ^{(1) (2)}
Average
price paid
per share
Total number of
shares purchased as
part of publicly
announced plans or
programs
Approximate dollar value of shares that may
yet be purchased under
the plans or programs
(in thousands)⁽³⁾
July 1, 2017 - July 31, 2017 3,620 $— — $100,000
August 1, 2017 - August 31, 2017 4,835,775 $10.52 — $100,000
September 1, 2017 - September 30, 2017 944 $— — $100,000
Total 4,840,339 —



~~(1)~~	Includes 3,620, 953 and 944 shares repurchased in July, August and September, respectively, pursuant to the provisions of employee benefit plans that require us to repurchase shares to satisfy employee statutory income tax withholding obligations.
~~(2)~~	~~Includes 4,834,822 shares repurchased for $50,883,635 on August 9, 2017 from an affiliate of AIP in conjunction with the issuance of our second lien term loan facility.~~
~~(3)~~	On August 4, 2016, we announced that our board of directors authorized the repurchase of an indeterminate number of our shares of common stock in the open market at an aggregate market value of up to $100 million over the next twenty-four months. As of November 8, 2017, we have not made any share repurchases under the August 4, 2016 share repurchase authorization.

~~Table of Contents~~

Item 6. Exhibits



~~10.1~~2.1*						~~Amendment No. 3 dated August 9, 2017, to Credit~~Master Separation Agreement, dated ~~May 11,~~as of June 8, 2015, ~~among~~between The Babcock & Wilcox Company and Babcock & Wilcox Enterprises, Inc.~~, as the Borrower, Bank of America, N.A., as administrative Agent and Lender, and the other Lenders party thereto~~ (incorporated by reference to Exhibit 2.1 to the Babcock & Wilcox Enterprises, Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 (File No. 001-36876)).

3.1						Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Babcock & Wilcox Enterprises, Inc. Quarterly Report on Form 10-Q for the quarter ended June 30, 2015 (File No. 001-36876)).

3.2						Certificate of Amendment of the Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Babcock & Wilcox Enterprises, Inc. Current Report on Form 8-K filed ~~August 15, 2017~~on June 17, 2019 (File No. 001-36876)).

~~10.2~~3.3						~~Second Lien Credit Agreement, dated August 9, 2017, among Babcock & Wilcox Enterprises, Inc.,~~Certificate of Amendment of the Restated Certificate of Incorporation, as ~~the Borrower, Lightship Capital LLC, as administrative Agent and Lender, and the other Lenders party thereto~~amended (incorporated by reference to Exhibit 3.1 to the Babcock & Wilcox Enterprises, Inc. Current Report on Form 8-K filed ~~August 15, 2017~~on July 24, 2019 (File ~~No.001-36876)~~No. 001-36876)).


3.4			Certificate of Amendment of Amended and Restated Certificate of Incorporation(incorporated by reference to Exhibit 3.1 to the Babcock & Wilcox Enterprises, Inc. Current Report on Form 8-K filed on May 23, 2023 (File No. 001-36876)).

~~10.3~~3.5			Amended and Restated Bylaws of the Babcock & Wilcox Enterprises, Inc. (incorporated by reference to Exhibit 3.4 to the Babcock & Wilcox Enterprises, Inc. Annual Report on Form 10-K for the year ended December 31, 2021 (File No. 001-36876)).

3.6		~~Amendment~~	Certificate of Designations with respect to the 7.75% Series A Cumulative Perpetual Preferred Stock, dated May 6, 2021, filed with the Secretary of State of Delaware and effective on May 6, 2021 (incorporated by reference to Exhibit 3.4 to the Babcock & Wilcox Enterprises, Inc. Form 8-A filed on May 7, 2021 (File No. 4001-36876)).

3.7			Certificate of Increase in Number of Shares of 7.75% Series A Cumulative Perpetual Preferred Stock, dated ~~September 20, 2017~~June 1, 2021 (incorporated by reference to Exhibit 3.1 to the Babcock & Wilcox Enterprises, Inc. Current Report on Form 8-K filed on July 7, 2021 (File No. 001-36876)).

10.1			Credit Agreement among Babcock & Wilcox Enterprises, Inc. and Axos Bank, dated ~~May 11, 2015,~~as of January 18, 2024 (incorporated by reference to Exhibit 10.63 of the Babcock & Wilcox Enterprises, Inc. Annual Report on Form 10-K filed March 15, 2024 (File No. 001-36876)).

10.2			Security and Pledge Agreement among Babcock & Wilcox Enterprises, Inc., and Axos Bank, dated as of January 18, 2024 (incorporated by reference to Exhibit 10.64 of the ~~borrower, Bank of America, N.A. as Administrative Agent, and the other Lenders party thereto~~Babcock & Wilcox Enterprises, Inc. Annual Report on Form 10-K filed March 15, 2024 (File No. 001-36876)).

10.3			Fee Letter (Supplement to the Credit Agreement) among Babcock & Wilcox Enterprises, Inc., and Axos Bank, dated January 18, 2024 (incorporated by reference to Exhibit 10.65 of the Babcock & Wilcox Enterprises, Inc. Annual Report on Form 10-K filed March 15, 2024 (File No. 001-36876)).

10.4			Guaranty by B. Riley Financial, Inc. in favor of Axos Bank, in its capacity as administrative agent for the Secured Parties (as defined in the Credit Agreement) dated January 18, 2024 (incorporated by reference to Exhibit 10.66 of the Babcock & Wilcox Enterprises, Inc. Annual Report on Form 10-K filed March 15, 2024 (File No. 001-36876)).

10.5			Fee and Reimbursement Agreement Babcock & Wilcox Enterprises, Inc. and B. Riley Financial, Inc., dated as of January 18, 2024 (incorporated by reference to Exhibit 10.67 of the Babcock & Wilcox Enterprises, Inc. Annual Report on Form 10-K filed March 15, 2024 (File No. 001-36876)).

10.6			Fourth Amendment to Reimbursement Security Agreement and Consent Letter by and among Babcock & Wilcox Enterprises, Inc., MSD PCOF Partners XLV, LLC and B. Riley Financial, Inc., dated March 15, 2024 (incorporated by reference to Exhibit 10.68 of the Babcock & Wilcox Enterprises, Inc. Annual Report on Form 10-K filed March 15, 2024 (File No. 001-36876)).

10.7			Sales Agreement, among Babcock & Wilcox Enterprises, Inc., B. Riley Securities, Inc., Seaport Global Securities LLC, Craig-Hallum Capital Group LLC and Lake Street Capital Markets, LLC (incorporated by reference to Exhibit 1.1 of the Babcock & Wilcox Enterprises, Inc. Current Report on Form 8-K filed April 10, 2024 (File No. 001-36876)).

10.8			First Amendment to Credit Agreement among Babcock & Wilcox Enterprises, Inc. and Axos Bank, dated April 30, 2024, filed herein.

10.9			First Amendment to Fee Letter among Babcock & Wilcox Enterprises, Inc. and Axos Bank, dated April 30, 2024, filed herein.

31.1			Rule 13a-14(a)/15d-14(a) certification of Chief Executive ~~Officer~~Officer.

31.2			Rule 13a-14(a)/15d-14(a) certification of Chief Financial ~~Officer~~Officer.

32.1			Section 1350 certification of Chief Executive ~~Officer~~Officer.

32.2			Section 1350 certification of Chief Financial ~~Officer~~Officer.

~~101.INS~~101.SCH			~~XBRL Instance Document~~

~~101.SCH~~	XBRL Taxonomy Extension Schema ~~Document~~Document.

101.CAL			XBRL Taxonomy Extension Calculation Linkbase ~~Document~~Document.

101.LAB			XBRL Taxonomy Extension Label Linkbase ~~Document~~Document.

101.PRE			XBRL Taxonomy Extension Presentation Linkbase ~~Document~~Document.


101.DEF						XBRL Taxonomy Extension Definition Linkbase ~~Document~~Document.

104						Cover Page Interactive Data File (embedded within the inline XBRL document)

*Certain schedules and exhibits to this agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the SEC upon request.

SIGNATURES

Pursuant to the requirements of the Section 13 or 15(d) of Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



~~November 8, 2017~~	BABCOCK & WILCOX ENTERPRISES, INC.

May 9, 2024	By:	/s/ Louis Salamone
		~~By:~~	~~/s/ Daniel W. Hoehn~~Louis Salamone
			~~Daniel W. Hoehn~~
	Executive Vice President, ~~Controller &~~Chief Financial Officer and Chief Accounting Officer
	(Principal Financial and Accounting Officer and Duly Authorized Representative)


Delaware			47-2783641

~~DELAWARE~~	~~47-2783641~~
(State or other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

1200 East Market Street, Suite 650
Akron, Ohio			44305
~~THE HARRIS BUILDING~~
~~13024 BALLANTYNE CORPORATE PLACE, SUITE 700~~
~~CHARLOTTE, NORTH CAROLINA~~	~~28277~~
(Address of Principal Executive Offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	BW	New York Stock Exchange
8.125% Senior Notes due 2026	BWSN	New York Stock Exchange
6.50% Senior Notes due 2026	BWNB	New York Stock Exchange
7.75% Series A Cumulative Perpetual Preferred Stock	BW PRA	New York Stock Exchange



		PAGE
Cautionary Statement Concerning Forward-Looking Information						3
PART I - FINANCIAL INFORMATION
Item 1.			~~Item 1 –~~ Condensed Consolidated Financial Statements			34

	Condensed Consolidated Statements of Operations for the Three ~~and Nine~~ Months Ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~202 3 (Unaudited)			35

	Condensed Consolidated Statements of Comprehensive (Loss) Income ~~(Loss)~~ for the Three ~~and Nine~~ Months Ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~202 3 (Unaudited)			46

	Condensed Consolidated Balance Sheets as of ~~September 30, 2017~~March 31, 2024 and December 31, ~~2016~~202 3 (Unaudited)			57
			Condensed Consolidated Statement s of Stockholders' (Deficit) Equity for the Three Months Ended March 31, 202 4 and 202 3 (Unaudited)				8
			Condensed Consolidated Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~September 30, 2017~~March 31, 202 4 and ~~2016~~202 3 (Unaudited)			69

	Notes to Condensed Consolidated Financial Statements			711

Item 2.	~~Item 2 -~~ Management's Discussion and Analysis of Financial Condition and Results of ~~Operations~~Operation			3033
			Overview				33
			Results of Operations - Three Months Ended March 31, 2024 and 202 3			34
			Liquidity and Capital Resources			42
			Critical Accounting Policies and Estimates			45
Item ~~3 -~~ 3.			Quantitative and Qualitative Disclosures ~~About~~about Market Risk			45

Item 4.	~~Item 4 -~~ Controls and Procedures			4645

PART II - OTHER INFORMATION

Item 1.	~~Item 1 -~~ Legal Proceedings			4746

Item 1A.	~~Item 1A -~~ Risk Factors			4746

Item 2.	~~Item 2 -~~ Unregistered Sales of Equity Securities and Use of Proceeds			4746

	Item ~~6 - Exhibits~~6.	48Exhibits			46

SIGNATURES					4849


Abbreviation or acronym						Term
2021 Plan						Babcock & Wilcox Enterprises, Inc. 2021 Long-Term Incentive Plan
6.50% Senior Notes						6.50% Senior Notes due December 31, 2026 issued by Babcock & Wilcox Enterprises, Inc. in 2021
8.125% Senior Notes						8.125% Senior Notes due February 28, 2026 issued by Babcock & Wilcox Enterprises, Inc. in 2021
Amended Revolving Credit Agreement						Amended Revolving Credit Agreement with PNC
AOCI						Accumulated Other Comprehensive Income (loss)
ASC						Accounting Standards Codification
ASU						Accounting Standards Update

Axos						Axos Bank, an affiliate of Axos Financial, Inc.
B&W Renewable A/S						Babcock & Wilcox Renewable Service A/S, formerly known as VODA A/S
B&W Solar						Babcock & Wilcox Solar Energy, Inc., formerly known as Fosler Construction Company, Inc.
B. Riley						B. Riley Financial, Inc and its affiliates, a related party












CTA						Currency Translation Adjustment
Debt Documents						Collectively, the Revolving Credit Agreement, Letter of Credit Agreement and Reimbursement Agreement
Debt Facilities						The facilities available under the Debt Documents


EBITDA						Earnings before interest, taxes, depreciation and amortization

Exchange Act						The Securities Exchange Act of 1934, as amended

FASB						Financial Accounting Standards Board


GAAP						Generally Accepted Accounting Principles in the United States of America




IRC						U.S. Internal Revenue Code of 1986, as amended

Letter of Credit Agreement						Letter of Credit agreement with PNC


MSD						MSD Partners and affiliates, including MSD PCOF Partners XLV, LLC
MTM						Mark-to-Market

NOL						Net operating losses

Notes Due 2026						Collectively, the 8.125% Senior Notes due February 28, 2026 and the 6.50% Senior Notes due December 31, 2026




PNC						PNC Bank, National Association
Preferred Stock						7.75% Series A Cumulative Perpetual Preferred Stock

Revolving Credit Agreement						Revolving Credit Agreement with PNC

SEC						United States Securities and Exchange Commission


SOFR						The Secured Overnight Financing Rate


(in thousands)	September 30, 2017			December 31, 2016			(in thousands)	March 31, 2024	December 31, 2023
Definite-lived intangible assets
Customer relationships	$	59,683		$	47,892
Customer relationships
Customer relationships
Unpatented technology	19,941			18,461
Patented technology	6,560			2,499
Tradename	22,818			18,774
Backlog	30,088			28,170

All other
All other
All other	7,550			7,429
Gross value of definite-lived intangible assets	146,640			123,225
Customer relationships amortization	(21,931		)	(17,519		)
Unpatented technology amortization	(4,443		)	(2,864		)
Patented technology amortization	(2,043		)	(1,532		)
Tradename amortization	(4,749		)	(3,826		)
Acquired backlog amortization	(27,814		)	(21,776		)

All other amortization
All other amortization
All other amortization	(6,965		)	(5,974		)
Accumulated amortization	(67,945		)	(53,491		)
Net definite-lived intangible assets	$	78,695		$	69,734

Indefinite-lived intangible assets:
Indefinite-lived intangible assets
Trademarks and trade names	$	1,305		$	1,305
Total indefinite-lived intangible assets	$	1,305		$	1,305
Trademarks and trade names
Trademarks and trade names
Total intangible assets, net


☒
x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	Three months ended September 30,						Nine months ended September 30,
(in thousands, except per share amounts)	2017			2016			2017			2016
Revenues	$	408,703		$	410,955		$	1,149,636		$	1,198,279
Costs and expenses:
Cost of operations	361,416			337,198			1,095,271			1,018,314
Selling, general and administrative expenses	60,241			60,697			195,847			182,761
Goodwill impairment charges	86,903			—			86,903			—
Restructuring activities and spin-off transaction costs	3,775			2,395			8,910			38,021
Research and development costs	2,291			2,361			7,454			8,273
Losses (gains) on asset disposals, net	59			(2		)	63			(17		)
Total costs and expenses	514,685			402,649			1,394,448			1,247,352
Equity in income (loss) and impairment of investees	1,234			2,827			(13,380		)	4,887
Operating income (loss)	(104,748		)	11,133			(258,192		)	(44,186		)
Other income (expense):
Interest income	121			115			359			656
Interest expense	(7,468		)	(379		)	(15,567		)	(1,169		)
Other – net	(7,633		)	(241		)	(6,024		)	113
Total other income (expense)	(14,980		)	(505		)	(21,232		)	(400		)
Income (loss) before income tax expense	(119,728		)	10,628			(279,424		)	(44,586		)
Income tax expense (benefit)	(5,639		)	1,617			(7,644		)	(790		)
Net income (loss)	(114,089		)	9,011			(271,780		)	(43,796		)
Net income attributable to noncontrolling interest	(213		)	(117		)	(566		)	(293		)
Net income (loss) attributable to shareholders	$	(114,302	)	$	8,894		$	(272,346	)	$	(44,089	)

Basic income (loss) per share	$	(2.48	)	$	0.18		$	(5.69	)	$	(0.87	)

Diluted income (loss) per share	$	(2.48	)	$	0.18		$	(5.69	)	$	(0.87	)

Shares used in the computation of earnings per share:
Basic	46,149			49,621			47,905			50,613
Diluted	46,149			49,857			47,905			50,613



	Three months ended September 30,						Nine months ended September 30,
(in thousands)	2017			2016			2017			2016
Revenues:
Power segment	$	202,222		$	211,749		$	612,274		$	762,293
Renewable segment	108,557			124,344			262,168			293,593
Industrial segment	99,288			76,809			281,734			147,275
Eliminations	(1,364		)	(1,947		)	(6,540		)	(4,882		)
	408,703			410,955			1,149,636			1,198,279
Gross profit:
Power segment	40,629			48,896			132,653			170,903
Renewable segment	181			18,592			(100,119		)	14,468
Industrial segment	9,461			14,601			34,240			33,506
Intangible amortization expense included in cost of operations	(2,984		)	(7,752		)	(11,455		)	(8,833		)
Mark to market loss included in cost of operations	—			(580		)	(954		)	(30,079		)
	47,287			73,757			54,365			179,965
Selling, general and administrative ("SG&A") expenses	(59,225		)	(59,615		)	(192,742		)	(179,225		)
Goodwill impairment charges	(86,903		)	—			(86,903		)	—
Restructuring activities and spin-off transaction costs	(3,775		)	(2,395		)	(8,910		)	(38,021		)
Research and development costs	(2,291		)	(2,361		)	(7,454		)	(8,273		)
Intangible amortization expense included in SG&A	(1,016		)	(1,018		)	(2,999		)	(3,071		)
Mark to market loss included in SG&A	—			(64		)	(106		)	(465		)
Equity in income of investees	1,234			2,827			4,813			4,887
Impairment of equity method investment	—			—			(18,193		)	—
Gains (losses) on asset disposals, net	(59		)	2			(63		)	17
Operating income (loss)	$	(104,748	)	$	11,133		$	(258,192	)	$	(44,186	)



(in thousands)	Estimated acquisition date fair value
Cash	$	4,379
Accounts receivable	11,270
Contracts in progress	3,167
Inventories	4,585
Other assets	579
Property, plant and equipment	16,692
Goodwill	14,413
Identifiable intangible assets	19,500
Deferred income tax assets	935
Current liabilities	(10,833		)
Other noncurrent liabilities	(1,423		)
Deferred income tax liabilities	(6,338		)
Net acquisition cost	$	56,926



	Estimated fair value (in thousands)		Weighted average estimated useful life (in years)
Customer relationships	$	10,800	15
Backlog	1,700		1
Trade names / trademarks	3,000		20
Technology	4,000		7
Total amortizable intangible assets	$	19,500



	Three months ended		Nine months ended			Twelve months ended
(in thousands)	September 30, 2016		September 30, 2016			December 31, 2016
Revenues	$	431,412	$	1,259,905		$	1,660,986
Net income (loss) attributable to B&W	8,903		(43,458		)	(113,940		)
Basic earnings per common share	0.18		(0.86		)	(2.27		)
Diluted earnings per common share	0.18		(0.86		)	(2.27		)



(in thousands)	Currency translation gain (loss) (net of tax)			Net unrealized gain (loss) on investments (net of tax)			Net unrealized gain (loss) on derivative instruments (net of tax)			Net unrecognized gain (loss) related to benefit plans (net of tax)			Total
Balance at December 31, 2016	$	(43,987	)	$	(37	)	$	802		$	6,740		$	(36,482	)
Other comprehensive income (loss) before reclassifications	5,417			61			4,587			(44		)	10,021
Amounts reclassified from AOCI to net income (loss)	—			(27		)	(3,843		)	(882		)	(4,752		)
Net current-period other comprehensive income (loss)	5,417			34			744			(926		)	5,269
Balance at March 31, 2017	$	(38,570	)	$	(3	)	$	1,546		$	5,814		$	(31,213	)
Other comprehensive income (loss) before reclassifications	6,757			(19		)	(2,204		)	(97		)	4,437
Amounts reclassified from AOCI to net income (loss)	—			(1		)	(658		)	(800		)	(1,459		)
Net current-period other comprehensive income (loss)	6,757			(20		)	(2,862		)	(897		)	2,978
Balance at June 30, 2017	(31,813		)	(23		)	(1,316		)	4,917			(28,235		)
Other comprehensive income (loss) before reclassifications	2,591			69			268			(66		)	2,862
Amounts reclassified from AOCI to net income (loss)	—			(4		)	3,567			(630		)	2,933
Net current-period other comprehensive income (loss)	2,591			65			3,835			(696		)	5,795
Balance at September 30, 2017	$	(29,222	)	$	42		$	2,519		$	4,221		$	(22,440	)


(in thousands)			Amortization Expense

Year ending December 31, 2024			5,668
Year ending December 31, 2025			6,685
Year ending December 31, 2026			5,530
Year ending December 31, 2027			4,916
Year ending December 31, 2028			4,633
Thereafter			13,854



Period ending	Amortization expense
Three months ending December 31, 2017	$	3,582
Twelve months ending December 31, 2018	$	12,444
Twelve months ending December 31, 2019	$	10,342
Twelve months ending December 31, 2020	$	9,042
Twelve months ending December 31, 2021	$	8,782
Twelve months ending December 31, 2022	$	7,205
Thereafter	$	27,298



(in thousands)	Power		Renewable			Industrial			Total
Balance at December 31, 2016	$	46,220	$	48,435		$	172,740		$	267,395
Increase resulting from Universal acquisition	—		—			14,413			14,413
Third quarter 2017 impairment charges^*	—		(49,965		)	(36,938		)	(86,903		)
Currency translation adjustments	1,180		1,530			6,490			9,200
Balance at September 30, 2017	$	47,400	$	—		$	156,705		$	204,105



	Power Segment		Industrial Segment
(in millions)	Power	Construction	MEGTEC	Universal
Reporting unit headroom	60%	98%	12%	18%
Goodwill balance	$38.5	$8.9	$104.3	$14.4



Face value	Unamortized debt discount and direct financing costs	Net carrying value
$175,884	$37,500	$138,384



(in thousands)	Actual for the period August 9, 2017 through September 30, 2017	Forecasted for the period October 1, 2017 through December 31, 2017	Forecasted for the period January 1, 2018 through December 31, 2018
Coupon interest (10%)	$2,554	$4,433	$17,588
Amortization of financing costs and discount	$1,095	$2,119	$9,678
Total interest expense	$3,649	$6,552	$27,266



	Asset and Liability Derivative
(in thousands)	September 30, 2017		December 31, 2016
Derivatives designated as hedges:
Foreign exchange contracts:
Location of FX forward contracts designated as hedges:
Accounts receivable-other	$	1,694	$	3,805
Other assets	750		665
Accounts payable	542		1,012
Other liabilities	183		213

Derivatives not designated as hedges:
Foreign exchange contracts:
Location of FX forward contracts not designated as hedges:
Accounts receivable-other	$	1,238	$	105
Accounts payable	2,594		403
Other liabilities	8		7



(in thousands)
Available-for-sale securities	September 30, 2017		Level 1		Level 2		Level 3
Commercial paper	$	5,394	$	—	$	5,394	$	—
Mutual funds	1,286		—		1,286		—
U.S. Government and agency securities	7,243		7,243		—		—
Total fair value of available-for-sale securities	$	13,923	$	7,243	$	6,680	$	—



Derivatives	September 30, 2017		December 31, 2016
Forward contracts to purchase/sell foreign currencies	$	355	$	2,940



Pension & other postretirement benefit costs (benefits)
(in thousands)	December 31, 2016			December 31, 2015			Current classification	Future classification
Service cost	$	1,703		$	13,701		Cost of operations	Cost of operations
Interest cost	41,772			50,644			Cost of operations	Other income (expense)
Expected return on plan assets	(61,939		)	(68,709		)	Cost of operations	Other income (expense)
Amortization of prior service cost	250			307			Cost of operations	Other income (expense)
Recognized net actuarial losses - mark to market adjustments	24,110			40,210			Cost of operations or SG&A expenses	Other income (expense)
Net periodic benefit cost (benefit)	$	5,896		$	36,153



(In approximate millions)	2017	2018	Thereafter	Total
Power	$155	$157	$170	$482
Renewable	129	232	703	1,064
Industrial	71	246	—	317
Other/eliminations	—	6	(43)	(37)
Backlog	$355	$641	$830	$1,826



Period	Total number of shares purchased ^{(1) (2)}	Average price paid per share	Total number of shares purchased as part of publicly announced plans or programs	Approximate dollar value of shares that may yet be purchased under the plans or programs (in thousands)⁽³⁾
July 1, 2017 - July 31, 2017	3,620	$—	—	$100,000
August 1, 2017 - August 31, 2017	4,835,775	$10.52	—	$100,000
September 1, 2017 - September 30, 2017	944	$—	—	$100,000
Total	4,840,339		—