Anthony Rozmus – Investor Relations Steve Lockard – President and Chief Executive Officer Bill Siwek – Chief Financial Officer.

Mark Strouse – J.P. Morgan Stephen Byrd – Morgan Stanley John Quealy – Canaccord Phil Shen – Roth Capital Partners William Grippin – Barclays Pavel Molchanov – Raymond James Jeff Osborne – Cowen.

Good afternoon and welcome to TPI Composites’ First Quarter 2017 Earnings Conference Call. Today's call is being recorded and we have allocated an hour for prepared remarks and Q&A. At this time, I would like to turn the conference over to Anthony Rozmus, Investor Relations for TPI Composites. Thank you, sir. Please go ahead..

Thank you, operator. I'd like to welcome everyone to TPI Composites' first quarter 2017 earnings call. In addition to our press release you can also find our Q1 earnings slide presentation on our IR website.

Before we begin let me remind everyone that during this call TPI Composites' management may make certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include remarks about future expectations, projections, beliefs, estimates, plans and prospects.

Such statements are subject to a variety of risks, uncertainties and other factors that could cause actual results to differ materially from those indicated or implied by such statements. Such risks and other factors provided in our Form 10-K and other periodic reports as filed with the Securities and Exchange Commission.

The Company does not undertake any duty to update such forward-looking statements. Additionally, during today's call the Company will discuss non-GAAP measures which we believe can be useful in evaluating our performance.

The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP.

The reconciliations of total billings to net sales, EBITDA and adjusted EBITDA to net income loss, net debt to total debt and free cash flow to net cash provided by operating activities calculated in accordance with GAAP can be found in our earnings release which is posted on our website at www.tpicomposites.com and is also included in our Form 10-Q as filed.

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

Good afternoon, everyone and thank you for joining our first quarter 2017 earnings call. I am joined today by Bill Siwek, our CFO. I will start with some highlights from the first quarter followed by a brief update on the wind market and TPI's progress against our strategy of strong and diversified global growth.

I will then turn the call over to Bill to review more details for Q1. I will then conclude with a review of our 2017 outlook before we open up the call for Q&A. Please turn to Slide 5.

We are off to a successful start to 2017 and are pleased to report strong financial results for the first quarter where we met our plan for total billings and beat our adjusted EBITDA target. In Q1, net sales were up 8.8% to $191.6 million while total billings were up 21.1% to $211.4 million.

Net income increased over 100% to $3.5 million compared to $1.7 million in the same period a year-ago. Adjusted EBITDA for the quarter increased to $15.6 million demonstrating growth of 36.7% and adjusted EBITDA margins expanded 160 basis points to 8.1%.

Our first quarter results exemplify our team’s commitment to continue to execute our strategy of profitable top line growth, margin expansion and working with our customers to drive down the levelized cost of wind energy.

During the first quarter, we announced a multi-year supply agreement with Gamesa in Turkey for one dedicated line of 65 meter-class wind blades and an option for a second dedicated line exercisable by Gamesa through September 30, 2017. We plan to begin production on the first line in early 2018.

We are very pleased that Gamesa has selected TPI again over our primary competitor to outsource blade production in the EMEA region after selecting us twice in the past for two factories in Mexico. We believe this decision positions TPI well for additional outsourcing opportunities with the newly formed Siemens Gamesa Renewable Energy business.

In addition in April, we announced a multi-year supply agreement with Vestas to produce wind blades at a new facility in Matamoros, Mexico where we will begin production in the first half of 2018.

From this new state-of-the-art manufacturing hub, we will be able to reliably and cost effectively serve the rapidly growing Latin America market including Mexico, Central and South America by truck and rail as well as by water from the Port of Brownsville, Texas.

This new location also provides us with the ability to expand and serve additional customers from the same complex. This supply agreement represents the fourth outsourcing decision where Vestas has chosen to partner with TPI and represents the third global geography from which we are serving Vestas.

We remain in discussion with GE regarding the potential extension of our supply agreement in China and still expect to make this decision by the end of Q2. We will either extend the agreement with GE or backfill the capacity from our strong demand pipeline in Asia.

We are very pleased with the new supply agreements with both Vestas and Gamesa and our execution against our demand pipeline. We also reaffirm our target of 25% average annual top line growth for the next few years.

We plan to continue to diversify our sources of revenue across customers and geographies and will continue to take advantage of the growth in the wind market, long-term stability in the U.S. wind market and the ongoing wind blade outsourcing trend.

If you turn to Slide 6, as of today we have 46 manufacturing lines under long-term supply agreements providing long-term revenue visibility of approximately $4.2 billion through 2023. While the minimum guaranteed volume under contract is approximately $2.7 billion.

Our contract structure encourages customers to purchase the maximum volume as their price increases if their volume drops below the maximum. Our pipeline also remains strong, as we now have prioritized 28 molds to close over the next 24 months.

As shown in Slide 7, annual installed onshore wind growth is expected to increase from 50.1 gigawatts in 2016 to 62 gigawatts in 2026.

This growth will be driven primarily by developing markets which according to data provided by MAKE will grow at a CAGR of 8.8% during that period while more mature markets those with at least 6 gigawatts installed capacity at the end of 2016 will continue to grow but at a more modest CAGR of 0.4%.

During that same period, MAKE forecasts that the annual share of overall installed capacity from developing markets will increase from 15.2% in 2016 to over 28% in 2026.

TPI is well positioned to serve these developing markets from our facilities in China, Juarez and Matamoros, Mexico and Turkey and the growth of these markets will continue to drive the outsourcing trend we've seen over the last 10 years. With respect to the U.S.

onshore market, as you can see on Slide 8, the next four years were expected to be the most stable in the history of the U.S. wind industry with expected annual installations averaging 9.7 gigawatts.

This market stability and growth is being driven by a number of factors including commercial and industrial demand, which is expected to make up over 20% of demand through 2026 repowering opportunities and the fact that onshore wind energy is in many regions of the country the most cost effective form of new energy generation even on a non-subsidized basis.

We believe we are very well positioned in the U.S. with our current customers accounting for 99.8% of the U.S. market share in 2016 and it is expected that these customers will continue to garner a significant amount of the U.S. market share in the future. Finally, as it relates to the U.S.

We have not seen any significant impact on the wind market post President Trump’s selection and wind remains an industry that continues to enjoy bipartisan support.

As we stated on our last earnings call, we believe current market conditions and our customers positioning for future sales including some smaller blades for repowering and cost out targets may result in more product transitions in 2017 than initially anticipated, but this will lay a strong foundation for future growth in 2018 and beyond.

Let me now turn the call over to Bill to discuss our financials in more detail..

Thanks Steve. Turning to Slide 10, net sales for the quarter increased by $15.5 million or 8.8% to $191.6 million compared to $176.1 million in the same period in 2016. Net sales of wind blades increased by 11.9% to $184.3 million for the quarter as compared to $164.7 million in the first quarter of 2016.

The increase was primarily driven by 15% increase in the number of wind blades delivered in the quarter compared to Q1 of 2016 primarily from our Mexico and China plants partially offset by a decline in the average selling price of the same blade models delivered in both periods, as a result of savings in raw material costs, a portion of which we share with our customers, slightly lower wind blade volume in Turkey and foreign currency fluctuations in both Turkey and China.

Total billings for the three months ended March 31, 2017 increased by $36.8 million or 21.1% to $211.4 million compared to $174.5 million in the same period in 2016 driven by a 31% increase in wind blades manufactured.

The impact of the currency movements on consolidated net sales and total billings were reductions of 0.9% and 1.3% respectively for the quarter. Gross profit for the quarter totaled $18 million, an increase of $5.1 million over the same period of 2016. And our gross profit margin increased by 210 basis points to 9.4%.

Notwithstanding the fact that we had nine manufacturing lines in startup during Q1 2017 compared to just three lines in transition in Q1 of 2016.

The increase in gross margin was driven by lower cost of goods sold as a percentage of net sales, as a result of improved operating efficiencies, the impact of savings in raw material costs and foreign currency fluctuations.

Startup and transition costs in the first quarter were $6.2 million as compared to $3.3 million during the same period a year ago. The increase in cost for Q1 2017 are related to the nine lines in startup and our new facilities in Mexico and Turkey compared to just three lines in transition during Q1 of 2016.

Before the impact of the startup and transition costs, our gross profit margin in the quarter was 12.6% compared to 9.2% in the first quarter of 2016 reflecting continued margin expansion from our fully operational facilities.

General and administrative expenses for the quarter increased to 4.3% of net sales or $8.3 million as compared to 2.7% and $4.7 million in 2016.

The increase was primarily driven by share-based compensation of $1.5 million recorded in the 2017 period, as none was recorded in the comparable quarter in 2016, as well as additional costs incurred to enhance our corporate support functions to support our growth and public company governance.

Net income attributable to common shareholders was $3.5 million or $0.10 per share on a fully diluted basis, compared to a net loss of $0.7 million or $0.16 per share on a fully diluted basis in the same period a year-ago.

The increase in net income as a result of the increase in net sales, as well as the 210 basis point increase in our gross profit margin, partially offset by total share-based compensation of $1.7 million. Adjusted EBITDA was $15.6 million, compared to $11.4 million in Q1 of 2016.

Our adjusted EBITDA margin for Q1 2017 was 8.1%, 160 basis point improvement from our margin of 6.5% in Q1 of 2016. Again notwithstanding $2.9 million more of startup and transition costs in Q1 2017 compared to Q1 of 2016.

Before the impact of startup and transition costs, our adjusted EBITDA margin was 11.3% in the first quarter of 2017 as compared to 8.3% in the first quarter of 2016.

We invoiced 636 wind blade sets in the quarter compared to 486 in Q1 of 2016 and the estimated megawatts generated by those sets once installed is estimated to be 1,460 and 1,130 respectively for sets in Q1 2017 and Q1 2016.

At the end of the quarter, we had 44 manufacturing lines dedicated under long-term supply agreements with 39 lines installed of which 30 were in full operation and the remaining nine were in various stages of startup.

The dedicated lines that we recently announced for Gamesa and Vestas will be installed beginning early 2018 and bring our total dedicated manufacturing lines to 46 as of today.

Moving on to Slide 12, cash and cash equivalents as of March 31, 2017 were $115.5 million and total indebtedness was $122.6 million resulting in net debt at March 31, 2017 of $7.1 million relatively flat compared to $6.4 million at year-end.

For the quarter, we generated cash from operating activities of $15.9 million while spending approximately $16.9 million on CapEx resulting in negative free cash flow for the quarter of $1 million.

Consistent with our past practices, we will continue to finance a relatively modest portion of CapEx for our new facilities and the balance will be funded with cash flow from operations.

We continue to be pleased with the strength of our balance sheet and our ability to continue to generate the cash we need to expand our global footprint and we believe we are in a solid position to continue to capitalize on the growth opportunities before us. I will now turn the call back over to Steve..

Thanks Bill. Please turn to Slide 14. We are reaffirming our guidance for 2017 including total billings of between $930 million and $950 million. We remain very confident in our global competitive position and the application of our dedicated supplier model to take full advantage of the strength in the growing regions of the wind market.

The trend toward blade outsourcing and the opportunities for market share gains provided by the current competitive dynamic. Thank you again for your time today. And with that operator, please open the line for questions..

Thank you. Ladies and gentlemen, at this time we will be conducting a question-and-answer session. [Operator Instructions] Our first question is coming from the line of Paul Coster with J.P. Morgan. Please proceed with your question..

Good afternoon, guys. This is Mark Strouse on for Paul. First off let me apologize for any background noise.

I think we want to start with your partners outside of GE, can you just give us an update on what their strategic response has been with GE acquiring LM if there has been any change in their strategic go forward here?.

Yes, Hey good afternoon, Mark. It’s Steve. Mark, I don't think we're in a position to comment on our customers business or strategy in that way.

What we can say is our pipeline continues to be strong it's diverse both globally, as well as by customers, existing customers of TPI that would want to grow more with us some new customers and some of those would include some LM customers as well. But we're not in a position to comment on our customers’ specific strategy..

Okay. It’s fair enough.

With GE specifically have you seen any change in there, their partnership with you, their purchasing behavior or anything like that that you can share?.

Yes, I’m afraid the same answer, Mark..

Okay..

I think what we can say is we continue to supply to GE out of our current operations and as we've said with respect to China, we expect to resolve that open question by the end of Q2..

Okay. And then lastly, I just want – you kind of touched on this before about you're seeing more transition this year and that accelerating in 2018 do you think that in even longer term trends, do you see that accelerating, decelerating any, anything you can share there longer term than just 2017. Thanks..

Yes, thanks Mark. I think there's probably a little more activity along that line this year, given that the long-term extension of the production tax credit, the start of construction definition and some of the repowering opportunities that there's maybe a bit more product transition dynamic if you will.

But in general, we've seen over the last few years every two to three years blade models are transitioning along with turbine models for longer blades and taller towers to help continue to drive LCOEs. We think that general trend would continue there's probably a bit more of it right now then might be normal..

Got it. Okay, thank you very much..

Thanks Mark..

Thank you. The next question is coming from the line of Stephen Byrd with Morgan Stanley. Please proceed with your question..

Hi, good afternoon..

Hey, good afternoon, Stephen..

Hey, Stephen..

At a high level, I wanted to just get your latest thinking in terms of your geographic footprint.

And I guess in general I'd love to get your thoughts on how you're feeling about where you are now versus where you might want to head over time and to be more specific I guess I'm thinking about the Mexico base of operations serving Central and South America.

Is that likely to be essentially the primary approach do you see any advantages to having a presence directly in South America just wanted to drill in on that market in particular..

Yes, thanks Stephen. I think we've said before and would say again that there are a couple of regional markets around the world that we're not perfectly positioned for Northern Eastern Europe is one spot.

We had mentioned Latin America in that answer in the past and with our decision to move forward in Matamoros that helps us really open the Latin American market in a serious way. And what's the blades around the water, we can move throughout the Latin American region quite cost effectively.

So it's our plan to be able to serve the developing markets in Latin America from that site and we expect it to serve to those markets quite well..

Understood.

Actually just wanted to build on the question that Mark had asked about just blade length and technology change, is this over the next two to five years, are we likely to see fairly gradual continuous progression are there natural step changes or should we just expect that we’ll continue to see the same kinds of trends that we have been seeing in terms of just continued increases in blade length, anything we should be looking for there?.

I think our answer at this point would be we would expect to continue to see similar trends in terms of blade length blades are going to get longer.

There may come a point where modular blades, blades built in pieces and assembled in the field comes into play, that's been discussed for quite some time probably more work being done on that today than there was in the past. So I don't think, we see any significant change to the trend taller towers, longer blades are likely to continue..

Okay, understood. And just last one quick one in your prepared remarks you talked about just raw material input costs.

Any bigger trends in terms of changes to materials or changes to costs and there's anything else at a big picture level or is what you're seeing sort of consistent with what you talked about in the past?.

I think it's consistent with what we've talked about in the past. Stephen, we're continuing to globalize our raw materials with our strong top line growth, our raw material spend is getting larger as well, we are one of the larger buyers of composite raw materials of scale around the world.

So we are continuing to do that work and as you know the share gain mechanism that we have with our customers where we share a portion of those savings with our customer helps them to reduce levelized cost of energy for wind and helps to expand our margins as well. So we expect that trend to continue but no significant disruption to those trends..

Very good, thank you very much..

Thank you..

Thanks Stephen..

Thank you. The next question is coming from the line of John Quealy with Canaccord. Please proceed with your question..

Hey, good afternoon folks. First question on transition costs they came in – startup cost came in a little bit better than we thought, is it from a timing perspective just I know Bill or Steve you talked about a little bit of change in the timing at startup costs in the back half of the year or are you seeing any efficiencies back to your point.

I think on the previous question about raws, can you just talk about timing versus any cost benefit you're getting..

You bet. Hey, John it's Bill good to talk to you. It's a little bit of a combination of both we are as Steve mentioned when he mentioned our new plant Matamoros, the more of these we do the better we get. So there are some cost savings there and there is a little bit of timing as well. So it's a combination of both..

Okay.

And just a follow-up on that one, remind us again on the labor contribution in terms of any upward pressure you may be seeing or not on the labor force across the international platform?.

Yes, our locations, our labor forces are pretty stable at this point. So we're not, there is we give that normal wage inflation in the regions that we're in nothing unusual or out of the ordinary. But we're counteracting that obviously would driving cycle time and operational efficiencies to drive down direct labor hours across the board.

So we do see a little pressure from that standpoint but nothing unusual..

Okay. And then my last one, I'm sorry if you talk to this on the alternative vehicle bus market, can you just give us an update there on how those relationships I know it's very long tail but how those relationships are developing? Thanks guys..

Thanks, John. Yes, the transportation space just continues to develop along the lines we've shared in the past. We are interested in developing that marketplace over time to augment and add to the wind, the runway that we see in the wind energy market but nothing specific or new to report at this point..

Thank you. Our next question is coming from the line of Phil Shen with Roth Capital Partners. Please proceed with your question..

Hey, Steve, Bill thanks for questions..

Hey Phil..

Hey Phil..

Hey, so this is a follow-up on Mark’s question. Steve, you mentioned that there could be more product transitions in 2017 than originally anticipated. We've seen some of your peers talk about maybe a bit of an air pocket of demand following the rush at the end of last year.

To what degree could that impact your volumes in 2017? I know you guys reiterating guidance for this year but is there greater risk for some downside move here and if you can just provide some additional color on how the year might trying for you guys, that would be great. Thanks..

You bet. Thanks Phil. So no, we're not really seeing that. Phil, I think the way our agreements work and also the international diversity in the drop and volume based pricing and kind of the overall stable or stable approach is helping us in that regard.

But we're not really seeing a drop in volume in 2017 we are seeing a little bit and it's not a huge shift but a little bit of a shift in transitions or timing of transitions as we described, but not more than that..

Okay, helpful. I know it's tough to talk about GE. That said in the events that GE does not renew its China facility contract with you. Is there a scenario that allows you to seamlessly bring up a new customer with no production down time or should we assume that if the GE lines come off at the end of this year.

We'll see a 60 month kind of transition period as you would normally with any new customer..

Yes, Phil, I think the latter the way you described it is right and whether we are transitioning a blade model with an existing customer where molds are being taken out brand new molds being brought in with a training learning curve, if you will for the workforce to come up to speed, whether that's an existing customer or a transition to a new customer.

As long as the tooling is ready to go sitting in the parking lot, if you will ready to go then it would look very much from a financial standpoint like a model transition with an existing customer.

And so we're pleased with the strength of our pipeline globally and in including Asia and so if that's needed in China we’ll backfill if needed, our preference of course is to use that pipeline for growth..

Just add on to that real quickly, Phil. When we talk about startups, many times we're talking about a startup in a new facility in a new location, kind of throughout that six to eight months I think in a case like China if that were the case.

Since we have the trained workforce already in place, I think that transition time would be quicker than a traditional startup if you will for a new customer..

Okay, helpful to know. In terms of the Matamoros facility, you mentioned there could be additional lines with Vestas.

When would you expect Vestas to perhaps make a decision on those lines? And do you think they're – do you contemplate in that facility having additional space to bring on additional customer or any of those discussions active regarding that facility specifically.

Yes, so that the timing of Vestas making a decision about additional lines is a bit up to them. And their view of their volume demand from that region or in the region in the Latin American market, we'll see how that plays out.

But the answer to your second question is definitely, yes and each case like this where we set up a new manufacturing hub, you could be sure that we would select a site that would have significant upside capacity to it. The site itself in Matamoros would be able to support 10 or more total production lines depending on the blade sizes.

So think of it as a 10 plus mold site with just that the first two molds being under contract with a commence construction type schedule at this point. And then from our demand pipeline, you could definitely imagine there's more demand for that region in the 28 mold prioritized pipeline as well..

Great. Thank you, Steve, Bill. I'll pass it on..

Thanks Phil..

Thanks Phil..

Thank you. Our next question is coming from the line of William Grippin with Barclays. Please proceed with your question..

Hey, guys. So with 39 lines installed at the end of Q1 and then you guys – guidance is for 15 lines in startup at the end of the year.

Just trying to understand that that seems to imply like a pretty big uptick and fully ramped lines like in early 2018, is that the right way to think about that?.

Yes, good to talk to you, William. With the nine lines in transition right now most of those are in startup rather those should be – the bulk of those will be in full operation by the end of 2017. So they should be contributing very significantly in 2018.

And then as you know you can do the math right we've got nine now and we'll have another estimating another six in startup before the end of the year. So you will start to see significant contributions from those lines towards the – that we install towards the end of the year late in 2018 and into 2019. I think that answers your question..

Yes, perfect, got it. Thank you.

And then my second question was just what impact if any, did any seasonality you have on the quarter?.

Yes. You'll notice when you look at the balance sheet, we had a bit of a spike in our deferred revenue, which is the bill and hold concept under the current gap. And so traditionally or I say traditionally occasionally in the first quarter either based on weather or otherwise sometimes our customers will not pick up the blades from storage.

Just because of weather delays in certain regions or for other reasons they may have project timing that's off a little bit. So that's really the only seasonality we really saw in Q1 or the difference from the comparable period last year was just the spike in the deferred revenue or in the blades that weren't picked up by our customers..

Got it. Thanks guys. That's all I have..

Thank you..

Thank you. The next question is coming from the line of Pavel Molchanov with Raymond James. Please proceed with your question..

Thanks for taking my question guys. One more about Matamoros, when I think about countries in the region that have wind installations, Brazil has three times more than Mexico and more than every other Latin American country combined.

So is there a rationale for basing a South American focused facility in Mexico rather than further in the Southern hemisphere..

Yes, Pavel. So I think what we said was it's not only South American focus but Latin American focused. And so you would expect – we would expect to ship blades within the country of Mexico roughly – its estimated roughly half of the volume in Mexico is at the Northern part of the country, which would be in close proximity to the Matamoros area.

We're also close to the Port of Brownsville, which means we can move blades down to the South of Mexico, Oaxaca region by water very cost effectively. And then to your point there are a number of developing markets outside of Brazil. Brazil, we would put in the camp with more of a mature market albeit a bit of challenge from time to time.

So from our perspective, the developing portion of the market is going to be quite reachable addressable in a very cost effective and reliable way as we said from the Matamoros location. So this is one of the markets that we've been targeting to open and to serve in a cost effective way. And we'll be doing that out of Matamoros..

Okay. As I look at your sales in megawatts, up 31% year-over-year and then billings were up 21% year-over-year. So does that imply 10% price deterioration over the last 12 months, is that kind of an accurate assessment..

Well, I think it implies levelized cost of energy coming down, which is an important driver for the industry to be more competitive. Longer blades rated megawatts per machine relative to the blade price raw material cost out that's actually a win-win deal for both us and our customers all of that contributes.

So we would expect the trend to continue where the blades are generating and the turbines are generating more kilowatt hours at less cost that's how as you know that's how we get to reductions in LCOE..

So is that a reasonable kind of relative comparison between the two, in other words if megawatts are up X, your billings should be up X minus 10% or is that going to vary?.

Yes, that’s going to vary, Pavel. It really depends a bit on mix of blades. It depends on blades that we – if we're folding in a bunch of new blade models that are longer blade models, you're actually going to see that ASP go up. So it's going to buck that trend a little bit.

But if you're looking at blades that are produced multiple years, on year-over-year you will see that price come down. So it's a little bit dependent on mix and where we're at in the startup phase with some of the newer longer blades..

And Pavel, where we are manufacturing the product to the extent that if we had more mix out of lower cost factories, just in terms of percentage of total TPI’s blades sold that it would drive that ASP down as well to the extent that there was more volume made in Iowa or Turkey for example that would drive the ASP up.

You can imagine, we've already said that the trend is for more developing market support. So you could expect that to be an ASP driver that would reduce average selling price in general that mix, offset by what Bill described is larger blades will be a higher ASP at the beginning for sure..

Okay, appreciate….

It's a blended answer right depending on those – a combination of those drivers..

Yes, clear..

Thanks Pavel..

Thank you. The next question is coming from the line of Jeff Osborne with Cowen. Please proceed with question..

Hey, good afternoon.

Just a couple of clarifications on my end, one on the – is it still about six months Steve to make a mold just if you find out from in June or by June 30 for GE in China that you would be able to get up and running and have that mold in the parking lot to start 2018?.

Yes, that's a pretty typical timeframe for the mold manufacturing. It takes time to make the plug and then make the first mold. And then mold sets come off to mold manufacturing line if you will more often after that.

But that's typically true sometimes Jeff, you may know will make molds, sometimes our customers provide the mold so it depends a bit on the individual customer in each specific opportunity. But I think the heart of your question regarding a GE extension for China, we still have time to be ready for January..

Got it. That's helpful.

You mentioned repowering a couple of times, to your knowledge is any of the output coming off of your lines smaller blade lengths that are for repowering or is that just a future opportunity that you’re highlighting?.

The answer is yes. Some of the volume that will be manufacturing will be and is smaller blades for that application. We're not going to get into the detail of exactly how much and for who but the answer is yes..

Got it. And then can you just on two international markets just one follow-up on Pavel’s question.

Brazil, my understanding was or at least I’m sure if its current but do they still require local manufacturing in Brazil to sell into that market? I know you highlighted a mature market relative to say Argentina and others that have had options, but I just wanted a clarification there..

Yes, the answer is yes. They generally are requiring local content and there are a handful of manufacturers there, you should probably know in country. The answer is yes..

Perfect. And then just last question for me is what is the strategy on India for you folks going forward, I understand you added some headcount there at least one person to explore that with knowledge of that market.

But I just want to get a sense of what your longer term strategy was?.

Yes. We don't have any specific announcement to make regarding India yet. I think the way we've answered the question in the past, Jeff is that there are multiple markets that we're not yet fully established in today and India is one of those, Northern Eastern Europe is another, Latin America was the third.

So we're dressing Latin America with the Matamoros announcement. But we're not in a position to make any announcements beyond that at this time..

Understand. Appreciate it. Thank you..

Thanks..

Thanks, Jeff. Thank you. It appears there are no additional questions at the time. So I'd like to pass the floor back over to Mr. Lockard for any additional concluding comments.

Thank you, operator and thanks everyone for your continued interest in TPIC. We look forward to updating you on our progress toward our stated strategy of global growth, customer diversification and expanded profitability. Thanks very much..

Ladies and gentlemen, this does conclude today's teleconference. Again we thank you for your participation and you may disconnect your lines at this time..