TPI Composites net profit fell to less than $10m in the third quarter of 2018, compared with almost $22m in the same period last year.
The US company blamed the drop on a 19.1% decrease in blade production resulting from increased lines in transition, lost volume from two contracts that expired at the end of 2017, a delayed customer start-up and foreign currency exchange fluctuations.
Earnings also decreased in the period to $7.4m from $26.8m in 2017. “The decline was driven primarily by the increase in startup and transition activity and the resultant lost contribution margin from blade volume lost during the transitions,” TPI said.
TPI chief executive Steven Lockard said: “Our customers continue to invest with TPI through the addition of new outsourced blade capacity as well as increased transitions, both of which have impacted our near-term profitability but position us well for long-term growth.”
Net sales in the first nine months of the year were $255m, up slightly on the $253.5m posted in 2017.
Lockard added: “During the third quarter, we expanded an existing multiyear supply agreement with Vestas for two manufacturing lines in our new manufacturing hub in Matamoros, Mexico; we expanded a supply agreement with GE in Mexico with GE agreeing to add two more production lines, transition three of the existing lines and extend the contract by two years; and finally, GE agreed to transition to a larger blade model in our Iowa plant in early 2019.”