Pioneer Announces Major Supply Award for Energy-efficient Transformers; Other Significant Customer Orders, Awards Expected To Add $30M in Rev

Pioneer Power Solutions, Inc. PPSI ("Pioneer" or the "Company"), a company engaged in the manufacture, sale and service of electrical transmission, distribution and on-site power generation equipment, today announced that it has been selected by a major current customer to fulfill its demand for aluminum-wound, distribution transformers compliant with the Department of Energy's new efficiency standards effective as of January 1, 2016. The award, which is still subject to the execution of a master purchase agreement, will replace and expand Pioneer's existing supply relationship with the customer. The purchase agreement is expected to yield significantly higher annual sales as a result of the Company's higher awarded share of the customer's demand, and increased pricing related to the new efficiency standards. Thomas Klink, President of Pioneer's dry-type transformer business and a Director of Pioneer commented, "This achievement is an affirmation of our consistently high service levels and the competitiveness of the solutions we have to offer. It marks the next natural step in our relationship with the customer, which has grown significantly over the last 10 years in its strategic importance to Pioneer." In addition, Pioneer announced a number of other major customer projects expected to be completed during the remainder of 2015 and in 2016. They include an initial award to Pioneer CEP for a series of power houses to be used at a utility-scale solar project in Southern California, and a follow-on OEM order for custom magnetics used in power distribution units (PDUs) at data centers owned by one of the world's five-largest e-commerce companies. In its Critical Power business, Pioneer announced the commencement of generator service work at over 1,300 cell tower sites in Verizon Communications' North Midwest region, and a series of backup power equipment upgrades and preventive maintenance service orders to be completed at over 1,300 Target Corporation stores across the United States during the remainder of the year. Nathan Mazurek, Chairman and CEO of Pioneer commented, "These awards are expected to result in revenue of over $30 million in the aggregate, of which we expect approximately $20 million to be incremental. They underscore the benefits of our acquisition, integration and product development strategies aimed at becoming less reliant on the utility, oil and gas and mining sectors, particularly in Canada, and diversify our portfolio of solutions to become more relevant in the renewable energy, data center, telecommunications and retail industries, among others."