Good morning and welcome to the Broadwind Energy First Quarter 2017 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Joni Konstantelos, Director of Investor Relations. Please go ahead.

Thank you. Good morning and welcome to Broadwind Energy’s first quarter 2017 earnings conference call. With me today are Broadwind’s President and CEO, Stephanie Kushner; and Broadwind’s Vice President and Corporate Controller, Jason Bonfigt. This morning’s earnings news release is available on our website at bwen.com. Before you begin today, I would like to caution you that this call will include some forward-looking statements regarding our plans and market outlook, and also we’ll reference some non-GAAP financial measures. Actual results may differ materially from these forward-looking statements. Please refer to our SEC filings and consider the incorporated risks and uncertainties disclosed there, including our Form 8-K and the attached news release filed with the SEC this morning and our Form 10-Q, which will be filed later today. We assume no obligation to update any forward-looking statements or information. Having said that, I will turn the call over to Stephanie Kushner.

Thanks, Joni. It was a busy first quarter for us, starting with the successful acquisition of Red Wolf, LLC, which adds both scale and diversification to Broadwind. Our financial performance was strong with first quarter revenue at $56.1 million, up 20% and at the top end of our guidance. Our gross profit rose to $6.4 million, 11.4% of revenue and up nearly 300 basis points from last year. And we reported EPS of $0.43, including a $0.34 one-time tax benefit. Excluding this one-timer, $0.09 EPS was up sharply from the $0.02 loss in the first quarter of 2016. EBITDA of $3.9 million exceeded guidance and the 7% of sales. Importantly, we saw the first tangible evidence of a recovery in the markets for years, following four down years for mining and more than two weak years for oil and gas. On the next slide, we booked $40 million of orders in the quarter, up slightly from last year. Despite high levels of enquiry activity, from turbine manufacturers, we’ve not closed the tower orders we need to fully utilize 2017 production capacity, particularly for our Manitowoc plant. The IRS deadline for securing qualification for 100% PTC was mid-April. And developers and turbine OEMs scrambled to ensure they could meet the 5% minimum spend threshold required to qualify their advanced stage projects. Like other tower manufacturers, we were producing full out to support this demand. As the last several weeks have unfolded, it has become apparent that some developers have now paused, filling their supply-chain pipelines after meeting these initial purchase requirement. Although we anticipated this somewhat when we established our operating plan for the year, the impact has been more severe than we expected. At the same time, we have seen an increasing number of towers being imported. That number has…

We will now begin the question-and-answer session. [Operator Instructions] The first question comes from Chris Morgan of Macquarie. Please go ahead.

Good morning, Stephanie. It’s Chris, how are you?

Good morning, Chris. Great, thanks. How are you?

Good. So I heard about the rebound in Gearing that we’re seeing. What are you hearing from your customers? Do you think it’s more related to an expected rebound in oil prices after the sell-off we’ve had over the past few weeks? Or do you think customers are talking more about Trump optimism with regards to the tax plan and how it might impact industrial companies?

I think it’s more oil and gas, because of where we are in the food chain, we are making gears that go into gearboxes that go into make frac pumps and mud pumps, right, that go to developers. We tend to get a little more whipsawed. When things go down, we go down faster, and when things come up, we come up faster. So I think that’s what we are seeing. We are seeing the recovery and the supply chain has been pretty much emptied over the last year-and-a-half or so. So I think that’s sort of a natural rebound.

Okay. Fair enough. And then my second question would be, if you could provide a little bit more color on the change in full-year guidance. I was wondering if there has been any changes since the last update on your Red Wolf outlook or this is purely a function of tower orders being pushed into 2018.

So the big driver is tower orders. The tower business is just not going to be operating at the 95% of capacity whatever that we’ve been at for the last couple of years. But I’m also being a little more moderate on Red Wolf. So when we did the acquisition, I said, I thought the segment would be $4 million to $5 million. And I’m probably coming off that just a little bit for both Red Wolf and for our CNG business. It’s probably too early to make much of conclusion on Red Wolf. I have to say, if you looked at their 2015 numbers, they generated about $3 million of EBITDA. If you look at their 2016, they were at $6 million, but there were some big campaigns of turbine retrofit. So we kind of knew they would be somewhere in between. And it’s probably too soon to say where that is going to go. We do see a lot of upside in terms of new market entry and some new products that we are bringing online. So we think it’s a very good fit for us longer term.

That’s great color. I really appreciate. That’s all I have. Thank you.

Okay. Thanks.

[Operator Instructions] The next question comes from Jeff Osborne of Cowen & Co. Please go ahead.

Hey, good morning, Stephanie, a couple of questions from my end.

Sure.

One is just can you talk about at this point what level of coverage you have for 2018 in terms of towers, visibility into that year by location?

Yes, so we still - we have a base-load contract that basically gives us a minimum of a third of our capacity with kind of optionality up to two-third. So that’s still in place; that would be in place for several more years.

And that’s for both facilities or just in Abilene?

It’s for both facilities.

Got it. And then, you mentioned some headcount and staffing changes both personnel as well as overtime, is there any one-time charges that we should be factoring in for GAAP accounting purposes for the upcoming quarter?

No, nothing material. We’ve incorporated that in our projection.

Got it. And then CNG is not a business that you’ve talked about historically. Can you just ground us in, A, what exactly is the strategy to grow that business and then put it in perspective about how big that segment was for 2016, for last year?

So we shipped our first units. Basically, we have a partnership with an Italian compressor manufacturer, SAFE. And who has a very strong market presence outside of the U.S., so we’re their U.S. partner. We shipped our first unit about a year ago, so we’re basically making compression skids that would be used in a fueling station. And I have to say, we made the decision to enter the business, when the gap between oil and gas prices was considerably wider, so there was a stronger economic driver. And the business has been pretty - has grown pretty slowly. We did make a little over $2 million of revenue last year. We’ll probably do maybe $5 million this year. Where we are seeing some growth opportunity now is more in basically what we call kind of a mother/daughter system, where you’re taking compressed gas and you’re trucking to users particularly on the East Coast. So that is something where this economics is still pretty strong.

Got it. Tell us…

It’s a natural combination with Red Wolf, because of what we do in terms of kitting and making these skids is very similar to what they do. So I think ultimately those businesses will be combined.

Got it. That’s helpful. And maybe just the last question is can you talk about on the Gearing side, any repowering for wind activity? Is that something you’re seeing either from a tower perspective or gearing?

No, I can’t say we’re seeing anything material. On the Gearing side, we are selling - we sell maybe $6 million to $8 million into the - it could be more than that, it could be closer to, let’s say, $8 million that go into rebuilding gearboxes. And we can’t really tell necessarily whether that’s part of a repowering or whether that’s just normal wear and tear, but it’s probably more the latter.

Got it. Thanks so much. That’s all I had.

Okay. Thanks.

This concludes our question-and-answer session. I would like to turn the conference back over to Stephanie Kushner for any closing remarks.

Thanks. Thanks, Andy. Thanks for your interest. We delivered a very strong quarter. Our tower results show what we can do when production is flowing consistently at both of our plants. The Gearing market is gaining momentum. The contribution from gears and process systems will grow as the year unfolds. We believe the downward adjustment in our near-term power shipments represents a market correction and is not in line with the fundamental strength of the U.S. wind energy market. We remain focused on the strategic goal of doubling our revenue and EBITDA margins over the next three years. And we’re working on a number of organic and inorganic opportunities to deliver that growth. So in summary, I look forward to updating you again on our progress next quarter. Thank you.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.