Earnings call transcript Q1 2023

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Operator

Hello, and welcome to the TPI Composites 1Q 2023 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded.

I would now like to hand the conference over to your first speaker today, Mr. Christian Edin, Investor Relations. Please go ahead.

Christian Edin

operator. you, Thank to XXXX like to Composites' TPI I call. welcome quarter earnings first would everyone

We forward-looking could which Exchange be of reports to our to will and making on materially. can applicable risks are call differ tpicomposites.com. the in website, and be subject risks that filings is found uncertainties, our detailed with Commission, which A cause included results statements actual discussion during latest this and Securities

references to non-GAAP Today's presentation measures. will include financial

the to presentation and of the refer You in today's historical contained to should slides accompanying measures. information for the measures financial definitional reconciliations comparable information GAAP non-GAAP

that, let TPI Siwek, CEO. With Bill turn me over to President and call Composites' the

Bill Siwek

Thank good Christian, everyone. for afternoon, Thanks, you our call. joining and

Today, first results highlights open the more automotive chain In for will addition to wind our Christian, quarter; businesses; we'll I'm supply market call here results, and our discuss CFO. then from and I'll service the with and Q&A. then energy the operations, our then financial global including Ryan our and review our Ryan cover our broadly. Miller,

X. million; a was million, Please nearly Slide in was sales plan. a over year-over-year our by and to first quarter, Despite during EBITDA to challenging total increased market global XX% year increase, which prior economic and turn adjusted climate, $XXX wind the XX% $X.X line with

in coming interest some are our green pay to proceeds use expand capital our events fund this years; needs; last to to to We call. and support from to from higher $XXX senior sure the We our in some since capital a initiatives; financing quick finally, summary us net ready key and growth; proceeds of working debt. Now support raised future approximately with notes healthy the rate suppliers specific million sustainability down provide make plan convertible offering.

intensity XXXX will blades turn our quarter, carbon lifetime. XX-year during million help operating X tons XX%. behavior-based diversity to progress and or XXX positive expected the further from and facilities; all equity enhanced of inclusion, program of emissions by neutrality We XXXX IDEA, annual X%; and wind safety We We equity. The turbine the without you XXXX inclusion, published waste get during COX by reducing achieved COX report we made to transitioned approximately of report. global our of our rate safety by please Slide equity behaviors overall metric ESG their goal produced goal highlights to the for reinforce over our inclusion reduction reduce at our benefits diversity, awareness, because towards our don't program diversity,

We are we of our Annual the and Meeting of later and increased diversity asking our of efforts team, furtherance enhance supermajority and charter Board month. at voting requirements staggered our global this eliminate to corporate the from our to phaseout our in leadership governance shareholders Board our documents approve practices, our

progress During our XXXX, make goals. plan to we ESG further on

this financial reducing of companies: energy great wind gas reducing cost in investment, at reduce rooftop example, gas global will XX% therefore, power greenhouse our the turbines, to example With renewable to with results, do emissions. of Türkiye, a able costs. can by while our For reduce energy be facilities to is rates, solar at operating same our we nearly our wind the all as expanding Türkiye market for well investing as while, volatility This time, what also and, energy. emissions in expect of be we greenhouse improve eliminate

update on operations, Now including a businesses, automotive and our quick Slide our X. global service please to for turn

our with other China to in additional manufacturing and functions. material and closing restructuring quarter, respect charges During our corporate we facilities headcount the recorded fourth and announced operations and impairment reductions

be to structural million per in result $XX $XX X have productivity focus million and beyond over in the on of realized operating years. achieved past year, We expect to we annual to continuing actions savings efficiencies these savings drive XXXX which cost to while approximately consistently of over

the were for significant Yangzhou the able with were We XX, the first plans progress our restructuring further than terms no lease We planning And terminate quarter. as on to in China favorable to have more lease. on. we respect of have March made we on obligations

our have to China balance over this the out count people We administrative to carry half wind in also will head that of dozen reduced year. down about a legal activities our the entity

in generate other at to a We good actions currently targeted took are shape on the are also savings. our and rate run structural that we

XXX performed first in facilities blade utilization a achieved wind to sets the rate plan produced Our and XX%. quarter. We of

with on down, working volume changes and impact expect are overall both guidance. but our those a handful changes up of revenue customers, to don't We

campaign revenue-generating spent in time in service, In were down inspection XXXX and increase a to reduction to an due rework. projects inclement global customer a large weather, and on technicians a sales year-over-year to due the in completion of of nonrevenue-generating deployed combination

For ramp the on We the services focused customer driving outside U.S. quarter, expect second service to remain again seasonality and by profitability driven sales and campaigns. of normal we our up expanding

to have continued our nicely progress automotive Things in business.

therefore, vehicle are We programs programs passenger in These caps of and to year-end. X a year Class cab by structures to commercial be parts, programs X-plus combination expect innovative EV development able to expect have delivery vehicles. production to during production and from move and, the X-plus

or and are enable continue We by business scale to the initial explore more and by to this discussions QX. strategic information encouraged the of to faster share to to have us for expect alternatives QX early end

chain, the relates to better last years. be it last supply continues during the than our it to X although somewhat situation challenging, call. since unchanged And largely significantly it's As has been our

XXXX. to over With 'XX expect to have pain/gain generally benefit to trend pre-pandemic and while continue contract to We structure materials raw overall cost shared approach, returned the we costs net logistics to have levels. of our down XXXX, a expect in compared

at Green last guidance of related technologies, recently renewable of European over as building Industrial implementation the formal components industry such speeding the REPowerEU. quarters, proposed key U.S. and EU, IRA Green as while while the green more aimed robust in the to discussed around we've XXXX expansion the initiatives, couple transition the see awaits we Plan clarity year policies of As such Deal and Deal on and energy previous the the as up in a

new last XX countries announced months. XX.X% the those deal where set outside Since the required XXXX. we installations renewable And will be areas, by limited spoke, to energy of energy EU to Dedicated be are timing within up renewable XX to to areas months. are approve reach

to expected currently to be Council and by later relief that's be needs of become law, XXX it than to Parliament permitting Although still order would endorsed and in second queues. this gigawatts no half wind stuck the permitting the of for provide EU in XXXX,

The U.S., that. and manufacturing in the credits. Here the transferability early continue and key of is see. to production may aspects the QX end we've areas, wait domestic later some that and wait guidance for be of others remaining advanced on we by on receive we as credit key heard direct pay, We'll content, latest as than including guidance may

resolved as the wind and believe strengthen by energy uncertainty well continues our partnerships confident with begins that begin energy the our in and with wind near independence to globally. recognize remain position unique installations a term, to and once share improve challenges strategically customers for will our industry in once with being is to to demand located we the demand continued security and, outpace wind driven TPI the as to we We therefore, face suppliers, capacity current focus While in footprint, to the midterm market expand again. strong along the profitability near regulatory accelerate on remains operations as

While growing this single-digit the couple free eclipse adjusted revenue digits the cash EBITDA billion, without margin our percentage as mid-single sales is our existing capacity a $X in wind high prospect yielding of years, and footprint. expanding over we next flow our of is a to the of expect exciting, and

Today, deal, for currently XXXX India. we have all Mexico; facilities. to Juarez, spoken to are are have working in the lines Mexico X for, The Iowa; we reserved end lines We capacity XXXX. lines also the production these capacity point of and and have in are GE those consists the And in although Juarez, lines are reserved of contract lines at by by in contract not we're This under lines lines lines plan X QX. the Iowa lines announced of operating the finalize and in within India of formally some formally and XX during X Nordex. of existing X end by and in Newton, the lines in our available by XX

sets operational. will per As that we capacity. at These have are provide lines with we or approximately us X,XXX least and XX gigawatts XXXX, enter to XX XXXX exit expect XX of globally year lines and installed

wind zero onshore than was XX% XXX of market needs IEA's to reach Xx scenario, approximately and Therefore, in almost be offshore. the by with have the In to XX% larger XXXX. net updated per it over gigawatts would year XXXX installation

engaged the next not we capacity gigawatts with and our customers, global is today to of needs customers. sufficient meet So growing are all long-term clearly, XX the strategically capacity discussion of our in over of will years so a be couple our footprint of

over With review Ryan results. that, to to turn let financial the call me our

Ryan Miller

information period segment Please our will to at All a Please note, on in reporting Asia XXXX. discontinued our been restated as has down of Bill. China shut compared financial XXXX. our year-over-year prior operations Slide X. basis Thanks, we to comparisons be to operations today continuing discussed the same end exclude the year turn for the operations in from

the million field tooling compared same the higher XX.X%. of due XX% or hereafter in compared of mix well just blade period in foreign impact sales, during the wind an primarily a wind first excludes wind increased to net blades fluctuations. in In partially sales models sales as the average other by refer inflation services, million sales, increase wind-related and prices $XX.X million $XXX.X and The to XXXX the the quarter of wind for was of sales XX.X% of $XXX.X increase net offset blades, prices, increase first on and quarter quarter first which Net period wind sales the I'll the as currency produced XXXX, produced of XXXX. to of were in by as of number blade to due wind XXXX, in to same

XXXX compared in XX% was quarter in the first year. XX% Additionally, of to utilization last the of utilization quarter first of our

compared period decreased in nonrevenue-generating an on in inspection XXXX of spent due large of in due QX deployed was services to completion weather, increase the same time and $X.X Field revenue-generating on in technicians reduction a the the combination campaign decrease sales to customer The inclement first million and by a quarter rework. XXXX. to of a projects in

decrease with The an sales primarily Automotive was of in a million XXXX. decreased number in the bodies sales offset of quarter first a compared period the same by bus products, minimum increase the partially fees other in in associated composite produced $X.X due commitments. to by volume and to decrease in automotive reduction

Net period in the common accretion stockholders preferred compared million same the net XXXX. includes in the loss attributed $XX.X first $XX.X the quarter to loss to million stockholders in common stock in to XXXX. XXXX, loss to our quarter a of of attributable compared of million $XX.X dividends $XX.X XXXX of and first was same period in In net million

Adjusted compared to foreign earnings same cost reduction production due criteria adjusted on currency and in the a costs, initiatives totaled The of to during and change and million transition fluctuations, a higher in favorable significant largely sales, due in EBITDA inflation increased requirements. period quarter offset primarily for net million XXXX. to first inspection $X.X was the customer's start-up EBITDA costs by increase XXXX $X.X lower

million notes in includes issued million, $XXX.X the talked $XXX.X We with convertible XX. the which equivalents debt, senior cash green and the ended net from Slide cash X.XX% of the Bill quarter, to of which about Moving earlier. proceeds quarter and unrestricted million $XXX.X we

XXXX We quarter in million used compared the XXXX. flow same $XX.X first in $XX.X free to in the of cash period of million

of shutdown during million payments cash and the payable, China of quarter $XX.X outstanding activities severance for associated restructuring with use other our of the operations. was Our

to gross payment contract energy increase for that due related and acquire an our addition, in manufacturing wind advanced facilities cash of down associates' unbilled Türkiye. $XX.X The turbines quarter production wind assets also annual payments $X.X timing bonus renewable $X.X to million payments. our included program In to will provide in million grew million and our blade in

first also quarter. of We capital expenditures the had during million $X.X

Moving on to Slide XX.

decreases. We They our the changes to of guidance on today. issued are play and adjusted range with increases quarter. we sales we our bottom a what know lot to closer EBITDA with volume of last will sales guidance and both customers, Still year, out a confirming handful out we that are but likely over working net end the

color lot I to still particular, digits. EBITDA adjusted and to provide XXXX. union our wanted during but some Türkiye to low addition, in guidance In guidance Similar of we year, a there's in our things negotiations out feel with on the still fluctuations, with foreign the comfortable our range sales, single for currency play

most When the be second expect in, the the the or improving wage for from offset of we will costs benefits headwinds. raw wage logistics second second incremental so most to and our productivity look of year, take changes I the likely at and quarter, further In half low-water adjusted EBITDA shape margin. kick of we quarter mark expect material improvements our and merit

Moving on expenditures. to capital

of million guidance XXXX million capital we start is expenditures discussed our open $XX to from capital purchase driven to to X manufacturing by expected range $XX in to in turbines as increase a our wind as revising the India. lines incremental well We up are Türkiye needed in project capital $XX The million. expenditures X

we relatively flat be with generally, cadence by of year, the cash flat. overall of but our end of be and as will the the balance we about remain should rest takes And the do to cash QX. throughout flows quarter, above it expect think There some puts our

be Now we Bill and the flows rate expenditures, some assets, lines expect from cash adjusted recovery interest to of in-process these alluded interest levels offsetting the tax payments, of elevated income flows of we generate down earlier, payments, as and paying credit. as positive will contract cash positive higher EBITDA capital

projected until working of means quarter as the sales that which be to the the we'll to a lowest we to less I other lines of well higher due production of quarter, are don't to currently balance as prepare year year lot for days, holidays, fourth the our over couple expect capital be changes begin expect our seasonally flattish which of as sales a transitions.

I'll with the to So turn that, back call Bill. over

Bill Siwek

bullish transition pace turn Ryan. continue success transition. and the business to very remain of managing expects significant and through on the industry Please a Thanks, excited coming years. remain the in role We play vital how the to focused on We our challenges we about to the will and the Slide XX. believe ultimate short-term growth on in positioned in the are capitalize we are industry the energy

I and stockholder enhance corporate couple on for finally, about their of want our our our vote again of Stockholders' practice, our if and amendments voting specifically upcoming X favor out key charter staggered requirements which, phase loyalty thank XX passed, proposals TPI. to dedication once and want TPI will to all to to all commitment, associates Meeting including and our encourage proposals, a I documents. And May our supermajority you governance to Board eliminate you to remind of in charter X Annual from

the to for questions. and back the open call turn over now operator call I'll the

Operator

of first Your Dumoulin-Smith from Julien Bank Instructions] question from America. comes [Operator

Julien Dumoulin-Smith

at visibility remarks, alluded You how that finalization here think digging bit bit, you you and the Can time where come more the from? prepared critically, in line visibility what but talked what little you've able your do a upside also, the getting perhaps XX some that about in here. is that about of Also about talked to XX, XX? to quarter, that of least here? little a you How think of for even terms those about would been talk it you prepared in about last in you to here. here just crystallize lines remarks against negotiations ongoing So

Bill Siwek

Yes.

all of final majority signed contracts feel we so on the again, first, although, XX. for of well Julien, as we the those of as with very lines, good have memorandums don't understanding have So of necessarily XX, letters intent, those

talked we include not have Nordex as Matamoros. X XX, that quarter, that last lines we currently does Now for about and the

move lines, we that if, clearly, So keep those to reason, for we could to XX. XX were some

right tell. now will intent time to, not but Our is

to on we you as EU then market in accelerate. I what alluded need to we clearly, we more implementation more in clarity to the clarity and get installs see the is, for what get capacity And to be there's and alluded IRA, and the a start going

the And footprints, necessarily And we at perspective. so year do I existing them X, right mentioned, we're long-term a we on different look we're looking from more now next but as with a customers not in expand footprints: existing can long-term our where at strategic or discussions our geographies. do of in serve as from to each best perspective, we

Julien Dumoulin-Smith

between bit look, It own to a your saying trying turns to can of And to decrease liquidity buy future little today, the read terms best our CapEx the of more the as going and here, here, operating energy, costs. bit think you to seems I'm statement financially talk what financing you in little describe in today pivot lines I it? confidence it sources invest incremental stand out. Excellent. a your confidence here, to like in ramping your you're sourcing if of about ramp bit a on Can say, specifically you wind where oriented how little way look, as the a we're today about to

Ryan Miller

is this Ryan. Julien,

the with here think I I that us as the convertible think we what provides ample move with note, did firepower forward. we

focusing been is in working I've capital. things the of One on our

you have so I get an it, And and external want we okay balance make efficient need also sheet. it's to out capital while to when sure go

laser-like moving think we focused that. And very so forward, we're about as in on

more balance go of out our capability incremental extract there's value think sheet today. I to

CapEx, at us where cash lowering our we're saw You not but today. raise is balance

we're us confident of sign indicating I where feel so it's we a And at. think pretty

position customers. windows with with And on to open sheet balance close some take have will make the at firepower able in that. think a we opportunities cash-wise, we today to our we're we're advantage do and we're of pretty sure Where quick our where

Julien Dumoulin-Smith

quantify your increased have requirements how Got it. overall, capital just working you this ramp? as Did guys much think about you

Ryan Miller

we quantified capital think as we're working driving sheet. push and I'd our generally I haven't any existing we look No, offset that. efficiencies our balance will to we where say, incremental at today, with through at speaking, needs really to try

way the think I it. that's to put

Julien Dumoulin-Smith

Speak Well, that all of Okay. right? right. luck, I'll All there. Best leave soon.

Bill Siwek

Julien. Thanks,

Operator

Your next ROTH MKM. question Justin Clare from comes from

Justin Clare

here. first the guess, wanted I into treasury So here, to off I dig guidance

guidance in guidance just was still manufacturing the on before We developers do terms talk content, significant haven't moving could to customers could if projects projects you wondering get that if side. and we time? but And moving domestic we're point waiting this whether in orders of a treasury, Like, guidance the guidance, is anticipate an uptick forward. seeing some that about gotten on I in we awaiting you're at your ahead hurdle here?

Bill Siwek

for capitalized where thanks some you, I I the ultimately developers more Justin, that guidance better roll out. are and question. there would will think confident maybe are tell in that

hasn't So it them that down slowed much.

that to I bit a see. think and there are others waiting more are little conservative

of may depending on turns projects. or some guidance this it how certain think make break I out,

think a of combination So it's I things.

some is holdback. there clearly, So

think to the interest also some I start rate environment ROIs. as you creating hesitation at look is

creating of and prepared the some at to mentioned Although to the the projects. continue perspective, least impacts improving to year, we're that fairly think significantly from improvement remarks, some our inflationary an with chain, as I through dealing we see challenges are in still is we supply expect the

orders to think that that's U.S. on said, the I on know article market. the U.S. boat. up. begin where get with very had and if absolutely same the bullish when saw to very GE, positive expect IRA And market, pick the GE a guidance, With in don't notwithstanding you we I going, we're that see today today article do but I

books think to certainly, have order are guidance build. some I the once full start do guidance. already clear more we'll So that, But even we that without seeing already we see of

Justin Clare

And contracts facility? Okay. let's by by the for similar? between in operational starting you to it to color for full talk frame year, your does signed the contracts QX, ask the like? like, And of to how at that if operate how look long then take what's if Great. that India, then, you you get about, your you signed then contract sign Mexico contract then say, assuming And kind that to and end getting Mexico, Appreciate get could there. were a lines, wanted And if all U.S. do the time is capability? that of the up that time as U.S. we the to look end So facility the frame what of and well. does might I sign

Bill Siwek

labor signed not signed all We of But back on But moving Mexico our there. in India, kind quite to from It's it's want just to start-up volume. be Yes. that, it needs we're tell would are we I Iowa probably that a forth because can and probably Mexico the say, have X/X versus have going because if frankly. not India, be workforce finally would would trickier customers the a the going a them, hire XX quicker of on it necessarily contract, when will a and finish. It's function on not. they're of it's we're start forward in or really bit the before Iowa, little demand contract to X getting and half what market will typically customer. you, again tight greenfields. start Iowa I much of be the And months depending for volume well, just in the than

Operator

from West from Your next comes question Evercore ISI. James

James West

question into that the at versus other they're I in guess, were visibility? saw U.S. out Is for 'XX the well, I'm now then sold they're Or if sold How as half contracts? being customers talking on I this quickly? to here the GE line orders remarks pretty time I and out, turn getting commentary. mean, are year translate so see memorandum does And about what's sold come your remarks into of, your a this out you'll when I bullish market. sold Bill, extremely was think, because the time, last which the curious, now

Bill Siwek

formal particular, I by the Well, expect visibility, expect. QX might you those of contracts. as our visibility is GE, great with end into turn those their in to for mean Yes. we

We for in have them U.S. a lot the of capacity

have, that's they visibility for really as obviously, well. better the good us So

James West

Of course, a course. And follow-up me. maybe of for

turbine the in years trying to process of year had they last rethinking entire their to guys also of make and their about easier, or and get conditions to increased the With chains deal order with of kind trying supply efficient? and inflation, more having X some blades standardization difficult you model are and the talking

Bill Siwek

James, mean maybe from talking a competitors' build Yes. they our in blade perspective much is talking when of type. about we new across blades introduction. I would each They're their and say, it OEMs I it's are product not blade it's obviously talking same modularization. standardization the factories of down as factories, from about factories standardization, how standardization slowing But NPI, a as standardization, about the our

blade So manufacturing a it's single it's Vestas to a turbine, Siemens in-sourced standardizing across on type that. blade across about runs nothing standardization outsourced, a opposed as footprint, all that or of like the whether

Operator

from from comes Greg Webber question Research. next Your Wasikowski

Greg Wasikowski

XXXX, granular from and of bit be to those and more get when, hitting appreciate the operations touched with you this, recap could it? giving on available around all to there, the wondering now lines, you maybe unknowns guys I out already have are was or on but if I you'd guys so and many the How do guidance start-up XX that you in a potentially the P&L. of cadence little ramp terms that see full

Bill Siwek

correct year. likely we're start. Ryan getting end those starting get at On And We're it looking to end wrong, by will India, I by of me. ready lines of this go the I'll this year. if the

you see in So to would XXXX. production production full ramping

'XX ramp. So 'XX, of and at you'd full be end entering by the

our In this that this and it's -- of mid-XXXX by now, build year the is start. full-ramp team it's end we'll probably hopefully of to start little getting probably a of point right one we're starting then year back Iowa, in and this then of And where 'XX. with point pushed probably in production start production bit. the a at the just to maybe at half of in the speed to the into 'XX, later year going But end almost right Mexico,

ramp a first being kind the it's full end year. probably So at of by production with of start-up the quarter-ish

kind expect, the customer, right? on all much lines. full that I into So region, was Did XX%, things, I moving of would clicking all depending of all be on if get ramp we'd on exiting everything volumes by 'XX, XX again, cylinders, pretty

Ryan Miller

Yes.

Okay.

Greg Wasikowski

contracts a on characterize more Got very from your about sympathetic the helpful. few you in physical ago? in just new years year That's months you pass-throughs, bit cost between or conversations And for a wondering guys And more inflation year a is last terms versus nature looking that I cetera. now contracts you could a actual X so et of or there was little being a it. the is then few ago? the labor, just Would the follow-up contracts. commodity, materials, years then versus incorporating talk contracts, last into if are an to difference process those at signed as in

Bill Siwek

Yes.

general, of there. focus COGS to on awareness been But BOM. lot So That bill there's material. in unpack always a a like of XX%, the total XX% as as far there's say, I There's much more inflation. the is would

focus the we've share environments customers. has seen them. fluctuation, that us there being been, our and by inflationary wages well paid the with we where by is and of the some other to Price savings. as and most on where see with currency as But been that's get more some down, price attention shared things that's Price the goes you So goes they would pain/gain. up,

the of and as now our some limits customers of on put for not good circumstances. we've right kind for Some pretty the us, it probably look good in

either into at some we extend working of as as those on So new we're contracts. looking renew enter We're that well. or or

still through new working of the contract the details format. We're

our on But focus to you environments. the a going bit that more you much environment with early it being But exactly how there, it's pretty years usually last that's it of for tell with fall inflationary around early a little customers. a clearly, little couple I'll simple say was yet up out. we'll So in long both to dealing are and deflationary until sides attuned more do. wind so to but been where We've exactly lot there's more tell lot done work to a to a

Operator

Your from comes next from Craig-Hallum. Stine Eric question

Eric Stine

So but to ask answer, this anyway. I'll guess might be I tough it

agreement know you're the up to look I future the with the an of your relationship collaboration Vestas stepping, may what guess, got to you've like. all and customers kind about I extent, So talking

of customers? the other interaction to other with just enhanced way relationship sort there I'm that well? as customers with So a some And kind have describe what of Vestas an is of could those it to your you curious, compared some possible is is

Bill Siwek

Yes. transitioned I different. good a we years but of And our down talking to used X day not the different. bit to so spent they're the lot relationships But more a would we road. years, lot issue year, is years, about would we've actually about with a years, customers frequency, issue with more with have transactional all one the over you the X of I be lot more little of the of what meetings, our strategic level, tell last higher you, bit XX X little and Each that tell of customers, a them. a really time

And that's customers. happening tell our of all I would with you

but of I think be but in standpoint. now are starting they to especially bit years, think our work what all couple know, are what little a on very as see customers a going the structure to potential contractual I similar have the tough long are do we to collaborative. and Vestas, beginning are been term is with relationships look that needs from it's geographic their very between strategically where a different customers more of way So And a today the we

which lot both so discussions, strategic that's these works of a forcing really And more for great parties.

Eric Stine

it. Got

so it I your to quarter you about what it I signed agreement, mean you And other put third on relationship, that when basically, differently, last call announced that. mean migrating towards kind it's customers, of you were talking more the And believe I year. in your

Bill Siwek

Yes. Absolutely.

Eric Stine

that, given certainly, focus. right. been speed but last levels, one over important of it's know couple me. a big All know that the transitions, Then Yes. maybe was of less years I last I activity for here

think of you where has? stand So look you impact you've strides made and maybe potentially term, that, the like, looks as business out you and you what that the mean, and longer I in about do the come this

Bill Siwek

Yes.

good the made last we've I years. really over think several strides

indicated, a that been you've focus. As has

in our I Day, to talked Investor due XX% COVID reduction after that, at think happened. cost about a we last time the transitions. and Right

now a hard kind really bit to little of go But And more locations, confident teams build at. each so where that the focus is a we're our multiple very global to to geographies would instead site in effectively. in of having transitions been that I can team it's feel at do transition of measure that. site, So multiple we

have we like to them not it's we stack because have And only team. X

that's if region, cost making same the tell that sure qualified transition, that more also So do more building and pool, to time, that I folks with that will talent are help effectively. we're we you, to transitions in case, would them at the enable only each the have but do the experienced us

Operator

Your comes James. from from Price next Raymond Graham question

Graham Price

get overall update For from if it I was should an I epoxy the and like could be trending costs carbon fiber the material we resin costs, on particular. sounds just know comments, lower throughout year. one, first in your wondering

just on a wanted to So little get I color that.

Bill Siwek

fiber as 'XX. epoxy on down pretty a with epoxy. come well position Indices in We're as Yes. resin have good both over carbon

as the back as we're talk with from logistics better XXXX, Now which when of is world pre-pandemic adequate but capacity we we standpoint similar down. inbound And I sourcing the up inbound opens China, balance not an in have are year. in for through with come today, the being improvement still outbound. of about a well costs to it kind But the logistics at China than us standpoint, pre-pandemic we see logistics, helping. opposed from logistics as, material capacity little talking because about levels, and There I'm to raw were a the levels, back is again in bit

that is capacity from standpoint, the lot a So pricing solid. pretty of and

carbon on fiber, And similar.

good capacity year where seems still little with this elevated from year. problems Now last overall, standpoint, From we to Europe, that, energy-intensive it in such in it produce it. costs. it's because where was. but was a that's It's cost they're be higher energy it's standpoint. still a And especially process from to than pre-pandemic, to at, shape bit had fine capacity pretty primarily with in weigh But that's and an that costs continuing on those

Graham Price

second And in Okay. basically my free fall. for then continues Got it. just Obviously, about currency a to exposure lira one, I wondering was in the be Turkey.

your impacts So wondering that I was profitability. how

Ryan Miller

it there. we've think inflation foreign of even currency lira, fall pressures a more free be to with I prefer the perspective, a the we'd from had So

Turkey minimum currency. I lira the reaction call a is Turkey the XX.X%. in with just in our certainly, think as we're functional our euro. this raised that on something about And we continuing the now because its And currency by and wage reminder, same we're seeing that's not the right talked last

as that's for weakens local thing dollars dollar in good in euro, and so costs us. the good expenses that's against as lira. also labor thing the a us, weakens And and also the actually bear the against the for we dollar local euro, manufacturing production lira a And as lira and

that's that for a thing weakens, us. As good

some forward, look now. first of We're that didn't seeing and impacted. same right currency the already we inflation quarter fluctuations, with experiencing have that, lira. first mirror the pressure the we're quarter pressures the in As that was our certainly we're reaction they inflation the Because hoping

Operator

Mr. the Siwek time. [Operator to now Instructions] There are at back like no any over further Bill turn remarks. I questions would closing conference this for to

Bill Siwek

you. and of as again you Look for forward quarter. TPI. speaking your continued as support well time you today Thank your to next Thank again interest to

Operator

concluded. Thank today's you The has for presentation. Thank now you. attending conference

may now disconnect. You

TPI Composites (TPIC) 3 May 232023 Q1 Earnings call transcript