TPI turns to Q2 loss despite rise in net sales

US composite wind blades maker TPI Composites Inc (NASDAQ:TPIC) today reported a large net loss for the second quarter of 2020 as additional costs related to the pandemic countered a top line rise.

TPI turned to a Q2 net loss of USD 66.1 million (EUR 55.8m) from a net profit of USD 1.8 million a year back. It noted that the result was adversely impacted by about USD 39 million, net of taxes, after the company failed to manufacture an estimated number of wind blade sets in Mexico, Iowa, Turkey and India under non-cancellable purchase orders due to the COVID-19 pandemic. Also, TPI incurred some USD 16 million, net of taxes, of coronavirus-related costs associated with the health and safety of its associates and non-productive labour.

While net sales climbed by 13% on the year thanks to the production of more wind blade sets, this was negated by the fact that the total cost of goods sold increased to USD 378.6 million from USD 308.2 million.

The table below includes more details about the company’s Q2 and first-half (H1) financial performance.

In April-June 2020, TPI produced 787 sets of wind blades compared to 716 sets a year earlier.

As per the COVID-19 situation, TPI’s president and CEO, Bill Siwek, commented that, as of today, all of the company’s factories have returned to pre-coronavirus capacity levels.

“While we believe we have executed well while navigating the COVID-19 pandemic with all of our plants currently operating at or above planned capacity, several of our manufacturing facilities, in particular Mexico and India, are operating in regions with high levels of reported COVID-19 positive cases,” Siwek said, adding that it cannot rule our temporary production suspensions or volume reductions at such sites.

“Due to the fluid nature of COVID-19 and the potential impact on our business we will not be providing 2020 guidance at this time,” he concluded.

(USD 1.0 = EUR 0.844)

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