Northern Power Systems Corp., a next generation renewable energy technology company, announced financial results for its fourth quarter and year ended December 31, 2014.

 

Year End 2014 Highlights:

Fourth Quarter 2014 Highlights:

 

“Northern Power delivered record revenue growth during 2014 as the proven capabilities of our highly differentiated technology and products gained greater marketplace recognition and interest,” said Troy Patton, president and chief executive officer. “Further, we are very pleased with our progress in advancing our product offerings and expanding our sales capabilities globally. Distributed wind is becoming a very complementary offering alongside solar, diesel and storage in the microgrid and distributed generation movements, forming the basis of both mature and emerging market electrical supply buildout. Based upon these efforts, we are seeing strong pipeline momentum in Europe as we continue to introduce products with improved features to market, while we are also seeing opportunities in regions outside of Europe, such as Korea. Finally, WEG’s installation of utility class turbines and their 500 MW backlog of orders based on our proprietary design validate our utility class wind technology. We look forward to expanding this partnership and pursuing similar collaborative relationships in other key global regions.”

 

“As we enter 2015, we are building on a healthy backlog and robust pipeline. Revenue in the first half of the year is expected to be lower than the first half of last year, given that most of our Italian customers are awaiting confirmation of government regulations which are expected to drive continued strong deployment of our turbines in that region. In anticipation of these orders, we have built a larger than normal inventory position which we expect to reduce as we believe we will experience a return to growth in this region in the second half of 2015. We are using this regulatory waiting period to transition to new blade suppliers that will provide a dependable, high quality supply of blades. Production ramp time will cause a temporary supply constraint that we expect to result in a reduction of approximately $4 million to $6 million in revenue over the course of 2015. We are also addressing our net Euro exposure, which we currently expect to impact approximately one-third of our revenue, and as such we are implementing various approaches to mitigate this exposure.”

 

Mr. Patton continued, “We intend to pursue a disciplined growth strategy focused primarily on expanding our position in the distributed energy sector while evaluating additional growth opportunities as appropriate. We expect year-over-year growth in revenues based on the anticipated Italian regulatory confirmation and successful completion of blade transition to our new suppliers.”

 

Consolidated Year End Financial Metrics:

Consolidated Fourth Quarter Financial Metrics:

About non-GAAP financial measures

 

To supplement Northern Power Systems’ consolidated financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), Northern Power Systems has used a non-GAAP financial measure, specifically non-GAAP adjusted EBITDA income (loss). Non-GAAP adjusted EBITDA income (loss) is defined as net income (loss), excluding share-based compensation expense, amortization of acquisition-related intangibles, depreciation of property, plant and equipment, interest expense, tax provision or benefit, and certain other non-cash impacts as applicable.

 

The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on non-GAAP adjusted EBITDA, please see the table captioned “Reconciliation of GAAP net loss to non-GAAP adjusted EBITDA net income (loss)” included at the end of this release. The table has more details on the GAAP financial measure that is most directly comparable to non-GAAP adjusted EBITDA and the related reconciliation between these financial measures.

 

Northern Power Systems’ management believes that this non-GAAP financial measure provides meaningful supplemental information in assessing our performance and liquidity by excluding certain items that may not be indicative of our recurring core business operating results, which could be non-cash charges or discrete cash charges that are infrequent in nature. This non-GAAP financial measure also has facilitated management’s internal comparisons to Northern Power Systems’ historical performance and our competitors’ operating results, as well as reflects measurements which are used by creditors and other third parties in assessing our performance.

 

Northern Power Systems

www.northernpower.com