Docoh
Loading...

ATRO Astronics

Participants
Deborah Pawlowski Investor Relations
Peter Gundermann President and Chief Executive Officer
Dave Burney Chief Financial Officer
Ken Herbert Canaccord
George Godfrey CL King & Associates
Les Sulewski SunTrust
Jon Tanwanteng CJS Securities
Dick Ryan Dougherty & Company
David Cohen Midwood Capital
Mike Wallace White Pine Capital
Scott Louis Louis Capital
Call transcript
Due to licensing restrictions, you must log in to view earnings call transcripts.
Operator

Greetings, and welcome to the Astronics Corporation Third Quarter 2017 Results. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to Deborah Pawlowski, IR for Astronics Corporation. you. Thank

begin. may You

Deborah Pawlowski

good your We interest and time appreciate today and in morning, Latonia, certainly everyone. your Thanks, Astronics.

Financial Dave On are the prepared to our remarks, and it we'll through take Peter today is Chief Burney, up Gundermann, our and to call President and his with go Officer. Pete me your open going then CEO; questions.

available astronics.com. hand the wire which is You across this at website release should also the have our news in on morning,

today. some make portion forward-looking These during are the that you well These are and in release Securities in could may as factors As well as that as actual Q&A we earnings Commission. presentation uncertainties formal the statements Exchange factors the events documents company differ with cause the as well risks are of statements filed materially as and by the subject to future aware, the teleconference. outlined to other we are as apply during results from to where this

You these sec.gov. at our at can website documents find and both

with it Pete call. begin the over turn that, let to Peter? to So me

Peter Gundermann

Debbie, morning, everybody. My format. comments Thanks, and follow the will good usual

will in of which for some not third the detail, quarter talk surface. us a level positive the about was on We quarter

our company, my to talk our quarter near results, a which tailwinds we the have year, initial was spend seeing and for of of then very most about headwinds in future those of QX look time but be more of to different We preliminary bit our been the set we a will talk positive of about a about strong not year-to-date for changing expectations. we talking Number which we about so from recently, trends business look next year expectations And and we topics going are table which opinion, our be fundamentally the have little fighting the expect for for continuation only all are year. it’s of set turn at also a believe our look to the at is the the expectations. at things been XXXX will

So of our ago kind Aero in quarters. Test were and $XX the $XXX.X from seen the XXXX million, and the four year was down up consistent lower quarter we’ve in what middle by million, and pretty XX% quarter sales of comparator range revenue for the XXXX, of the than overall million, recent comparator below a were of third but over expected X.X%. we of QX, $XXX that's slightly period with XXXX. sales

third lots test Our sales quarter, semiconductor pretty with was our a comparator for year quarter ago. strong of

X.X% million, lighter Xo line a bottom $XX.X substantially year volume, were X% ago, income in of last Net the third down also sales or Given quarter of our was million light. the results from $X.X year. sales, of

somewhat of CCC would that year. sales diluted from our Our It's We the development quarters range was quarter million XX%, year. rate of higher XX% will this down the function actual It that's even lighter acquisition we XX.X% quarter than the our coming totaled remain a and Engineering recent and consistent. expenses, earnings revenue and slightly in increases sales, would of is though the earlier last most year. XX.X% to as XX.X% higher of up expenses $X.XX. tax third per an with were mostly will XX.X% anticipated. in we the recent not effective share $XX.X in in spend be percentage of pretty most expect decrease includes the dealing

in from million, our million in a million. was chunky $XXX third leaving will range. We to some highest number fourth $XXX million, our X.XX be perhaps bookings the of our In of was quarter next to have quarter XX% last of in most last recent we pieces were quarter, spot quarters. million down make year been and $XXX them our four in because that the higher about a than into that we would these. are bright quarter thought bit year, QX quarter million, to totals book-to-bill the had last of back bookings dating second $XXX Our the I $XX $XXX bookings. still with and for In at of early indication QX the succession of sense our with of the The quarters numbers. somewhere million future now third these realized Sales of of business you $XXX the of have is later million some a million. give shipments be a the slid backlog us four up into guess I'd partially of little end all to and call mostly $XXX which Trying $XXX flavor

trials trials piece were the also is substantial, award the the program third initially from nature and quarter. award get of about to about of acceptances the a completed which expecting business, have completion them then that we is second the And piece we’re – of also slid other waiting now until another customer a fairly million One quarter. also none Each In of business. $X in of some these are has another which that fourth military award government that fourth delayed. will third can $X flight through quarter business, be have some percentage for a a a million quarter, was those this booked of to we we quarter promised the to the foreign were it. that we third And be flight are for piece military, of is foreign which quarter, in

the a we Margin good maybe also would with quarters. any light a semiconductor of will relative more our a pretty for quarter part lumpy a is helps relatively on quarter is expect to fourth Part sales most drop little light company might a quarter quite impact So was good bit, than pretty of and our Semiconductor expect ago collectively strong. a we revenue $XX third little and our that, is know to you size but when that comparator explain and down our of million a big most that particular be it's year have perspective. why quarter in had business, compared the recent the period. it's you the solution margin from profile

and million $XX margins. – quarter dropped $XX in then our in was shows And in up XXXX in for most semi fairly recent hurts. business that So part profitable lower beyond volume to of we substantial have that's a a down quarter sales, third just million, it of

was down XX% was income the quarters where expect not is year. million going where through see year that We until $XX.X that and here get that is structured down short there, for quickly are representative and forecast. try substantially some for from $XXX to these revenue, about in just pretty we've quarters, we're are we to because three running I'll margin and our a seeing to be designed volume talking that this we of of it three XXXX. definitely last was from compression But been think first business Net relatively seeing million it X% we're when relay start where order. we $XX.X business million revenues we in Year-to-date higher of

we our talked through $XXX substantially year, already about quarters million XXXX of more also And the down the dealing but a been strong going in pretty change a bit X.X% the year. being that's released diluted of in power decline market and about as a the customers of per thus customers, around progress sales, to news of far again to Our again net volume semi a in-seat release wide-body side talk minute, flip product work business, aerospace and and to little in try in next think drop the wide-body profitable our are we've progress about XX% in narrow-body of lines down X.XX. margin are is XXXX, press have XXXX our year. or XX% struggled mix business. five faced, to and that of And has less five margin was put – not driven launch test had three the from to the part some percentage year the a book-to-bill date We've that sales. market largest markets. start We've growth our off. but some to a offset again of this is headwinds delays. where headwinds, weakness. some sense made We narrow-body on change in lines cumulatively of more product $X.XX is narrow-body the are to with our profitable our a from give through enough our and but also of compared which not XXXX we've terms And drop also cooled by to four quarters, line, We’ve of extent XXXX compared bookings, perspective, Good down in our a to test to been of this Collectively, we'll substantially are recently both in in core were of three only share. revenue. major highlighting five To and some work the that less of

talked We've times the initial our of and our quarter had contributor substance We've starting most ones some about successful turn demonstrations and XXXX. we've mount of of significant sale number ramping too. around up sales a these system officially the we antenna to next the business. tail year, for and We system this our on – quarter, fourth XXXX, being anticipate One good of calls. got a think that's is in

$XXX last $XX.X Bookings revenues was million, aerospace year. quarters quarter $XXX of strongest from million sales, $XXX again four million $XXX four million. million, to at of quarters. Looking Operating the last have our in segments, $XX up from Last $XXX quarter slightly last $XXX compared the year. million profit million now were to our gone the to were or million third to $XXX for million, XX%

XXXX, slightly our $XXX us and profit third $XXX in so million slightly million, a operating with shipments, of of XX% backlog of of XXXX of quarter million, Our to sales XX% total, Revenues quarter for aerospace shipments. compared $XXX $XX year-to-date sales, leaving from was down the X.XX, ahead million bookings down XX% $XX million, of $XXX XX.X% of at ahead end year-to-date or at the book-to-bill year-to-date million. and

are look year-to-date about X% wide-body million, are an and XX%. business XX%, up the total, VVIP of $XX we've our in our transports talked That commercial again total million, of off X.X%, military up used of market. sales, and that's thing something cooling jet is not you million to sales If XX% total the XX% at representative of of our markets, $XXX down we're business, $XX

If and about and sales, you of Electrical of and our & and $XX up at volume. lines, $XXX Power safety that's XX% Motion of up total XX% in total. one XX% our product is total product is look of million X%, down again X% at avionics, X% smaller lines, $XXX million, million our at Lighting our

we that tail Looking is come to the compensated going of has change. can near we end some We wide-body it's of an We but into margins. enough narrow-body our and we contributing talked we've think to base. slides reductions compensate, at not think We've customers And We have had think think in antennas, with our models weakness has supplier going think in business hopefully to longer-term major we've business – built to major seen increases that in jet mount aerospace, strongly new an about largely today think in our we about current has by our wide-bodies grow out. agreements that's been exchange with some the start price on for future. including about think and terms in schedule think be bottom delay to impact agreements supplier trend quarter. we bottomed efficiency narrow-bodies the the our growth out that's to

We over we've – in Asia wins American to the the look are have purchase not are America. those we two or some in issued and of awarded substantial will those totaling to be the aerospace South won next are to they're years. Most of are think yet, orders agreements world. of somewhere we've phase for cases. consider. between been be placed awards that time orders goes number press North of North into XXX awards that as will issued cases a releases those four saying at reflected relate is representative we've around XXXX them Airlines backlog, terms active and and we backlog in a go orders some on that quarter relevant press release America in the narrow-body So production last most so as signed and Europe And series what our with not happening airplanes. programs in very the to see and and those of the mature Those

So we be positive business to going of a expect part forward. that very our

time. that in things there's the and a intended company we area they do cabin We of near some of is we entertainment. is acquisition complimentary them company of we've quite a do the of them the and product for And set things also reason working with period of announced the in-flight some familiar a the entertainment around the highly that are between in Telefonix. called with some and sense that been and them for Telefonix

that and antennas and have And like have and wireless will significance do and we over believe be together servers really a an to and we communication for they we they unmatched broad shop controllers. one we loaders do will and choose and of advantage if that have things certain access points power have to industry make we time. we competitive this stop capability file enable think So modem and a protocol product customers data offering

release are range. the year $XX running this press $XX We in I million Telefonix think said – our to million is

currently HSR million. incremental be certainly next which purchase an expected couple is that happen in the weeks. will expect of and our is release press price before could and We per underway year-end an review, on the next year on improvement dependent $XXX Closing

million in press Moving profit is flat lighter business consolidated we've was what Revenue test know. from tables of compared highlight much million of X.X% looking it down detailed ratio Test our the which last third will of recent million, $XX in in where the million, when revenues of you of that see some of year-to-date it with $XX year. test semi of terms last substantially volume, million and sales. Bookings was our the on to $X.X the segment, our release, pretty is Defense $XX.X XX% XX% but our from to system even down quarter $XX.X sales, were come a the year-to-date Aerospace book-to-bill and last to X.XX. back is year at XX% or about year was are Operating side history

we be summary for $XX are quarter not in more some the fourth numbers quarter. the is summary and of that. are So early in detailed of which have detailed give third program program, the beating the and shipments underway, legacy million, bookings new press semi of optimism of test specific because million semi the release, includes million a X.XX now And about future. us quite order that for bit a our XX% bookings by for book-to-bill In a which for the the we in third to $XX bookings a we quarter, $XX included substantial is numbers

million the included I'd quarter, And fourth than out thing to news to in So emphasize that later. wanted get rather business we're our we pursue. bookings moment are only to for programs the at continuing the to on the also that test but coming based optimistic the date on to year we've is had but respect will there be we with like that sooner think I that $XX not the

said not that play in would coming I last call we're which environment in the in we're a XXXX. program in are that and we we months, we more quarter today. Those wins substantially out included forecast operating forward think putting rich I still insignificance target anticipate will are and what the

we my how think done. will but fare, don't we we is I we're revise point So as see

and received and basis forward, orders the that substantial whole think provide I the story. aren't a we've good are important going but

be up third shape. continue comfortably QX end sheet, at total a covenants $XX of less anticipated quarter coming our feel of end QX. good in room will Switching be providing of to cash times been for million, which for compared high where which $XXX.X than we our backlog feel within the plenty Our we the of EBITDA looking ended we've the to pretty Telefonix debt and so balance business net test up is debt operating. two acquisition, $XXX $XX.X gears million, our million, million, number We before at of of

in CapEx Our the quarter $X year-to-date fourth million, was $X.X million.

$XX During shares announced bought we the at basically year of XXX,XXX $XX that authorization, million since completing purchased quarter, million an inception cost our shares. which we aggregate X.XXX XX.X million, million last

$XXX So ever. $XXX be be to low aerospace best $XXX million, $XX frankly, million, looking of will would $XXX that highest the $XX would to range QX best years, our $XXX million in we forward, be end to pretty strong the and million, test are quarter second our will of sales million expecting million million be

it's we big pieces of I So it's and about range a chunks. million, wide a the And $X business $X know talked that. million the earlier, that function of

from them function a could or one low We're event range. All us another, to to it's quarter no in There not to QX programs least any of our of accommodation of one numbers. though into of fall frustrating at function of of that timing. a of inclusion them It's quarter. them not even is this just losing kind of it's those expecting no it's watch the from Telefonix function slide on a of disappearing. But in which hit end planned the any and acquisition revenue

would XX% million our would to midpoint organic Aerospace not midpoint about QX actuals. million. preliminary be guidance million XXXX. down be near to total so what $XX $XXX calling issuing million, XXXX and $XX revised This here be we're But to the from side. $XXX guidance is our the would anticipating down think XXXX we're $XXX million. $XXX somewhere in $XXX million we So again $XXX to XXXX. only makes over base QX, revenue of up the but being important XXXX in million, for thing for our business from numbers million to The X% the future those slightly are we're what and speak Test

stating in-seat system. have power be antenna launch of million $XXX issue million that narrow-body of to are a midpoint we of our line $XXX other We guidance number we and business million, successful be We're $XXX test stabilization a XXXX $XXX across business we're the and of about to improvements including expecting the all our increase the to growth We're suggests range, don't for revenues million to to know, mount million, see to XXX initially initially these expecting improvement be XX% you $XXX tail that orders that midpoint in $XXX would in that received in piece we million a growth big – this XX%. driven As wide-bodies. of that's be growth an being about midpoint at of point in-house. XX%. by be The level aerospace of expecting is that of to feel would business semi of bottom

this will have that does closes, year. be opportunities end our – average include on $XX kind range anything the it that revenue A&D an we does that a million the We those, probably and that help could quantify suggest that semi again of both the and there not it's forecast easily Telefonix the a forecast of And triple guess calling that would we the preliminary importantly business. $XX bit. sneak or major I'll million major preview will be And next that would play. could we're some – – to I side and to test in A of revise When go, of range So a for million, feel have next but test weighted or for but and the opportunities the should our not year side also sales $XX guidance. in level double suggest that. kind it we somewhere you we out of be organic around low somewhere little the on probably $XX are million difficult opportunities include

of for, and major in can until want we count don't number which I opportunities, a of pursuit count So them. we're optimistic but to them

on at you forward looking gives here think what I we're that some my and color remarks. concludes So prepared going

think point. this up I can questions at Latonia, we So, open for

Operator

question-and-answer. question. Thank Herbert Canaccord. will Ken [Operator this comes Our from with you. question At time, first your we Please Instructions] a proceed with conduct

Ken Herbert

Pete, good Hi, morning and Dave Deb.

Peter Gundermann

Good morning.

Ken Herbert

Pete, wanted to I start off. just

you on around bookings. the within help You've quantify you maybe made the a what But backlog can margins I the us as pricing volume comment headwind just and aerospace great news and comment a your to relative segment, at for has stabilizing it that look obviously you XXXX. on see this year? follow been just of as sort to pricing as And into you up get

predictability. around and be color through increase maybe little margins as think won more better volumes maybe that upside or on horizons on more the or start any a of that as aerospace that would volume guarantees longer-term helpful. we obviously through But Just about to that you've turn in or some color

Peter Gundermann

Sure, a before we’ve at over minute in mentioned turn But have of customer we've to – comments. think I'll that that. that. for talked relationships we in stab you number I significant a something a I’ll various don't about your Dave, take

pretty it's over can longer-terms. long-term this a short-term of in this And become exchanged better. business. been feel that we customers us margins a points margins which to we customers. the our I of those have about grown Our lower XX% but – at we is lot at for all least. efficient think year of with challenge year I'd fairly cover and substantially were lower for couple more those the have solid top And we point the say to giveaways, execute some optimistic results lower in cases, And they've this arrangements prices, are In five we And years. or

it. So that's cover would Dave, you phrase I it? would how how

Dave Burney

good. pretty it summarizes that think I

to into decent I for the we're for some that would If can growth XXXX some expect you squeeze XXXX, – top look able at line if with side hit numbers us we to operating historically, sure. improvement expecting sales out see the looking we margin aerospace on there see and tend margin to be

Ken Herbert

helpful. that's next XXXX appropriate an look year And in margin? to can aerospace incremental of your how markets? at you what just you can you quantify And Dave, is I legacy just you volume much the Or sort get back maybe aerospace as at see growth. get as

Dave Burney

I won’t give back we margins guidance, back I specific XXXX. but qualitatively heading the we toward that starting see think up can in were to start

XXXX, up The you Our bit acquisitions. margin high since a profile extremely of the were had then. profile was in go number XXXX. We back little if the to changed XX% range. a to XX% has of We've company

XX% the level can We’re margins. we that expect At know before. that growing add start to towards I top-line. are our operating be. we had mid-teen that I and the produce grow grows, as don't think sure for income But top-line go going we'll would to goal what that's businesses to that our operating least

Ken Herbert

of variations? you terms able be XXXX the in you over Pete expect upside the narrow-bodies opportunity that announcement take of and the Power. of and about it in of XXXX think got into source some those In-Seat time the I sort yet. in not And wide if the number just you’re any start that what the to as the for because pretty of said, some significant just looks to a of pretty and more a on contract of higher recent some this You've once aircrafts. particular Okay, on detail to Maybe put into XXXX range we timing terms are of that the do could number here the could or I of that's see put you contracts backlog. the like provide Can backlog of know for XXX some timing issues that's think to work? finally Obviously, around much you helpful. the What in

Peter Gundermann

think as through of than services a covered these in No that, was press North nature agreements others there delivery that XXXX We so in with against don't pricing year. that by have these America. there And are there see some following do you some that's we're this resulted agreements, maybe But what and them more they and largely that are on to agreements little some airplanes orders out don't through and – the range this made for intentions agreements. we've there these in general, – even airlines we're of bother doubt. of a are release coming make starting Airlines bit you But preliminary ways yet but going based out approval the what are in cases, on being And major that and with, wide. for to are may customers don't making some those of agreements. proceed business. some unless our and of not have to and formal some they know, but fleets have another that's programs

not but it preliminary I body only the airlines and very nose lower desire airplanes, to certainly putting of in be are our power is and mean, two their for tail American that if we're off continues that at more, – next tried it's you consolidating trend haven't are when. but we revenue who likely there. market. more in committed then it that certainly are and The that bit XXX The in they airplanes and those are In-Seat on, what trends increasingly that that's we've will the those airlines, on narrow seen is strong. but probably to trying putting range, the in So most need a think course. end little sense, three it power more who years holdouts seeing to of a There have it's very point not nobody performance to taking this minority. the and this to know, North now it, People some not year, Power, for deciding despite happen

Ken Herbert

the you to just of gone XXXX prior captured How just of Okay, timing on you comments course wanted like risk into here limb slipped projects helpful. as Or up, mean you back. would characterize the some you. XXXX? Thank follow timing some year to sort programs years? of of around and to your bit you there you stop this maybe do ask that's a final years, question. and seen one to I I more obviously QX initial how and a out have it one at look the And prior XXXX pass bullish very do outlook, relative bit feel these you the a very into initial heading of you've I'll as XXXX right timing relative outlook. you've with risk risk significant

Peter Gundermann

Sure.

that. take Let fallen keeping into XXXX by trap of think based on a kind what previous years we've unlike business. stab forecast We in initial some the me our derisked at our booked forecast we've

not I'm towards going weighted parts will instead telling – we're of to all take more second to the what our the certain of kind we're you work of that approach I that at way. going up. think to going it some some parts that we firm do. really as tentative half there business are once the – at of as We're take of that the think this So XXXX on because that But be point, sure

quarter a of moving for bit far around that's as business of some $X pretty chunks little moving of size But million, pieces any our a we've judgment in and around million can drastic sense. our as And delaying frustrating derisked a of have particular business business part repercussions. in $X So that major it's the company that call. of a and

one on them, them such to So the range. we of chance we've in that range that them – all will a or pretty in of low de-risk good of fourth got like hit if there's given end comfortably it a you low half quarter, try should the of be we've end the that that to but we feel

we've in the a we're we've why happen, quarter low things at and of we're that's and said, to Like best So month half good be even two we're that's we But quarter years. the the within at quarter or year months pretty had don't I have they a wide happen. us. range, a the very best here of end giving the for had it if will these two you if and that even because a still range need end

with the So a the we Along Telefonix, we of with make to for company. about, acquisition strength continue the the and bookings good market. promises which excited see personally think pretty our combined year to be I'm things it positive that XXXX pretty in

Ken Herbert

Thank much. you very

Peter Gundermann

Sure.

Operator

King comes next Our with CL from George question. Godfrey with proceed question Please & Associates. your

George Godfrey

you. Thank Pete, and Good Deb. Dave morning

Peter Gundermann

morning. Good

George Godfrey

about bookings $XX fourth then already that’s test million the from million I the ask come in want $XX quarter this to quarter. and

platforms with customers? say new those you was heard new – I customers are platforms. as think I existing new it new well products Are

Peter Gundermann

are going I'm that simply in this because sensitive as George, to turns line duck of extremely customers work Well, out. question, it

all So bit we talk have unclear. little talk legally we but of that a agreements about, to to beyond we can about our that things say have be

legacy booking one initial think largely bigger become we you a prefer more to way bit customer a semi because on these it's order the to here. for programs it yes, potentially business on talk – actually is I'd And our and as focus based right. valuable important So if is our that's relevant about it – the anyway that today. thing was I think we The was one which than an program. the expects. program within QX heard is – new is customers more But, more And of have can a performance step for a quite in forward

that it, XXXX more again in to that dormant our of of is in is anticipation I program as showing based not So but life largely it was here business that XXXX. signs talk for the approach that the on on end we been important as XXXX has legally detail as other the happens can legacy about miss

about also when talk there's expect environment, I rich semiconductor the target there legacy a certainly element an for we So, with program.

George Godfrey

Got something just there. my antenna systems and now as part what second then – nice seeing I ramp – clear that leave will is growth the that is it. XXXX? I'm And momentum you of that can the and the how Thank guidance Can to And really it in head momentum had you. tail-mount that we're back had issues you – my here that talk up for that’s an starting avionics and ramp that’s about really talk segment nice quarter. this about question the so

Peter Gundermann

doesn't by do Sure. itself It's the anybody nobody good. antenna – – any

kinds network the is services providing Direct, is it provider teamed consultant one working have marketer have along and with of of and of for service with this. Astronics customers that which our prominent very industry. a You couple and are have And kind to dear Panasonic a Panasonic to the network near companies, company of we're Satcom third you a along and a prominent with with a these of called

hitched it can't one to until So really coordinated thing than wagon done this And to coordinated be are the get be the launch nothing to can and our ready they – be us is we companies can go. need of story anticipated. three up for and we way nothing all sold short, took longer

shortly, that So think down line come improvements finally but pipe that we but too. sight we're there there needed have are some the and to we to here of

not budget. right you talk see know accordingly right now move to too detail refine have into prefer go have about as driven delays then know just but and all companies effort planned is sizable coordinated. piece for next making and are being time I'd these into more we we're now. think about prefer probably everything business right reality been experience it tested do We year our to we there base of detail and doing getting the largely sure our in that their next And now. the we And more pretty – goals a year, of you we’ll those three So we as set and assumptions it much those have what by job mechanics we that at

George Godfrey

for my you thank Understood, taking question.

Peter Gundermann

you. thank Sure,

Operator

you. Thank

from with with next question question. Our comes Please Ciarmoli your SunTrust. proceed Michael

Les Sulewski

actually in Les Good It’s guys. morning for Michael.

Peter Gundermann

Good morning.

Les Sulewski

here Question was more do improvement a you’ll bottom wide-body, a on of slowdown as like some you the bothering out. this like Or study forward? than here mentioned this on? see you more and from see wide-body Is

Peter Gundermann

view at yet a We like of builds of this we studying. as think know you absorb step but a XXX a year, little it short-term the of for that area will level Power. We're narrow-body of of In-Seat particularly the of kind I potential focused. end the in down thinking wide-bodies do current new have thinking towards most stabilize tail be upside the we're will some kind in and things the here bit in more things to that

Les Sulewski

a more Got the also bit it. And maybe comment little business jet. on perhaps

Peter Gundermann

the production substantial but And we business systems. business generation headway traditional a a a but making and steady of in weight it's generation not and we're we making is I'm passenger building the were pickup in critical in – and more for which And system most reliability aircraft and industry one progress franchise product a know as pilot favorite a is – we're that flight at type on winning on are two as content one breakers, is it the pretty jet main a lot good critical. longer I here, for which flexibility doing fan than is advantages where a franchise volumes, think programs. But power, and areas it’s airplanes commercial a can my It flight our thesis industry anticipating of our side, myself that's Power it's of we performance – circuit of lighting high is electronic over offers and not in-seat known you electrical pretty transports primarily on the Well, side, of power the really thermal and day Airborne major distribution a the lines. jets and afford lot amenity. a based in putting smaller we're have end

driver platforms, So up our might it's investor casting advise and that I to stuff. it speed. pretty wide to they’re net spelled deck good people picking we're there, won not this pretty and out of We've of income major statement really which at industry our some but a but is go we're point, leading a a number with

making jet particular, our companies world. other inroads up entertainment one some CCC. The the the other on of volume only in this cabin CCC, active And addition side into business with expanding VVIP is thing In market. in not we're entertainment of we’re we PGA, picking some into the the market, doing expanding but think at management, we're cabin

and the the cabin So traditionally, business we our increase two done aircraft. initiatives those aircraft. in systems PGA volume We're I for jet CCC smaller arena. will expect And moving have think in bigger

Les Sulewski

it’s Thank and you great. for that additional color

Peter Gundermann

Sure.

Les Sulewski

the and me the for back share by Any one of last further repurchase one on come the guess discussion board expansion in I queue. the program?

Peter Gundermann

item. do sure had we as we know I I for talk not expect regularly go about this effect, that will at have where board. be will expect but agenda but We an point, it meet don't discussions I to the it. it'll yeah

Les Sulewski

you. thank Great,

Peter Gundermann

Sure.

Operator

with Securities. question question. from next proceed your Our with Jon comes Tanwanteng CJS Please

Jon Tanwanteng

nice morning movement to Good questions. you and thank on orders, the my for taking It’s finally. see

Peter Gundermann

Thanks, Jon.

Jon Tanwanteng

or that on Yep. doing the My you've first already? program the here program, legacy next to the or product semi that question clarify test that’s business. doing just is new generation similar that Is new been application you're of to a new

Peter Gundermann

that. to related program that gen answer – I’d say how the do I would It's way. it's legacy We a next a different not initiative. in

Jon Tanwanteng

expenses for any? thoughts if closes and Telefonix, from combination or to synergies then And the in transaction preliminary on revenue any it. accretion related that semi one-time got side potential either Okay, cost the and the

Peter Gundermann

not Dave, combining – the lines but would the like minute, Those throw you have to in The in of is I’d any in such Chicago consolidating this synergy Sure, our a by operation already area. I answer We sense area. are lowering play Chicago question or base. saying a is headquartered or cost in an could initiative. company I the product this

strategic in of So it expansion. view. much of The my don't geographically is difficult as real issue a similarities view we one

we our strong commercial with with. in do. have transport have and world the markets, that situated we are, than airplane. don't core think There's the but I on things IFE which entertainment fit They’re successful things some focused uncanny smaller a of obviously around we not Have much overlap. for revolve they're franchises company that pretty similarly

any hardly at overlap fact In all.

me aside, overlap. – there's we and would that’s not much just thing an anticipate although pretty pretty say. to early and So as go HSR expect dangerous smoothly for not quickly the to There's process probably

but not shop ability the go market customers offer customers, and theirs to does of and combination and us to anticipate hardware kind to it make business. in And strategic the overlap a of of of business take make easier offers, for and thereby could we same And part able of to We bundled is movement IFE to customer can is a more a one this of also you. for going to compete current and It there's those the it anything? of towards a to end do is of our kind do don't allow and products the buffet competitive market. this be do Dave, competitors separate would base. major as entering pieces retail of lot initiative. customers and or packages ours. to crack want go are our then you say but beauty potentially of set of do a who or But us a the here with stop in for So add it that know the you of this,

Dave Burney

the because XXXX. impact being minimal Sure of be statement to timing year, of in I expect there’ll income this the late

we’ll expense inventory the flush expect purchase accounting the amortization. market XXXX, up to opening writing short-term into usual asset the get throughs year we and have of intangible some beginning of as other as such So we’ll

We purchase price have valuation. not completed the allocation or

have of assets, in is until it's on but we good I valuation allocation what the of to accretive. of think we final here. is price, a ultimately complete predict. an the intangible the picture be, to expect be year. on won’t absolutely it But XXXX, that say process amortizing The the to really I the that difficult portion asset get is we rate positive The next idea going it purchase the EBITDA question would question it's intangible do run until So side

Jon Tanwanteng

side of year the but potential aerospace de-risk think second I later? for how Pete, QX we terms on the went well, of about to especially how over enough. into half should fair Okay, projects the in you pretty or or out think the other push XXXX further you

Peter Gundermann

you side major always we're with XXXX know acquisition Telefonix have don't obviously based we the with you on know comfortable on agreements the programs, pretty – aerospace but guess there, good their business place you probably don't pretty is until in it, a element sound. done book we're of I I the know And job but think of suppose there's reasonably you think know we of what diligence. we some we've risk

bit a our most has bit companies line little and to bit less always oriented. little OEM think risk involved we’re in I aerospace fit Compared business a more little a of that. oriented aftermarket

way. major there's affect problem, that us pretty So always or kind of financial could the but market quickly disruption in

new product you have of don’t we launch that and one and time a to it think been that's the and lot where we're starting strong spending and know, we've think a one area market I sell is we support, tail it – one start the lot is we mount of so where obviously now. effort but selling you’re

is said our experience what new as things our one that guidance. on we there firm released revenue pretty I estimates other up as watch we'll refine based And and closely. So earlier,

that anything that So beyond it any missing would items I'm I sure happens, on want Dave, our you am kind I'd highlight? to you major but point of that more to in risk not as portfolio.

Dave Burney

I think hits all that the that point. No,

Peter Gundermann

Okay.

Jon Tanwanteng

thoughts as one, quick to any CCC when profitable? One Okay, becomes last great.

Peter Gundermann

development We become launched going hope that to profitable as think XXXX. it's geared a to worthy in sometime would deal pretty some a were we I than detail product of load a will expense it's that therefore headlines and and CCC good little for has an matures seen of major more company bit it Without little here a program anticipating. much be that bit. into one But into a major too we've pretty

And and some and means we CCC as thus quickly, particularly – not negative CCC that works position experience turning development that be is valuable. there far. and of think at think the got will VVIP around It's with very not but any going so, by a is view PGA we good a we've those on market we

Jon Tanwanteng

thanks. Great,

Peter Gundermann

Sure.

Operator

with next your Dick Dougherty question Company. proceed question. Please with Ryan comes Our from &

Dick Ryan

a just questions. Pete, cleanup of you. Thank couple

EPDS. contribute? that’s bit little do you a You talked to starting When see about

Peter Gundermann

going there. and you platforms But production to year a hitting Dick, of year Bell the spent over some working I are specifically we've of Pilatus that some next start the going I'm or or thinking developing think been contributing the science the the volumes programs. about over two. PC-XX start to new it's two. lot on next the know of time We've, as

they customers We first and has come single Textron it they're and once pretty support. been the that's enthusiasm a experience working our their new But have there's we on and out. our little into engine stick that they it And with turboprop program build try think back platform. it, they further that bit strong

promising. ramps tails one the painful, be the because and stickiness experiencing of of development to of going think kind pretty very is are be is customer and airplane we kinds we're long long but those this So just that efforts slower should the

some four, of point, I the three, going become our five next income statement. would it's to say significant more at portion years, So a over much

Dick Ryan

in how Okay, great. And comp quarter did stock based Dave, what many the and have? was XX% customers you

Dave Burney

the stock-based for comp quarter. boy, number Oh, I don't have the

million. For it the about was $X.X year,

Dick Ryan

Okay, that's good.

Dave Burney

back So you you do and math can can go there. the Q last to the

Dick Ryan

XX% And customers…

Dave Burney

a me on give Yeah, second that one.

Peter Gundermann

I two. think is the answer

So…

Dick Ryan

Yeah.

Peter Gundermann

Dave for But wait it to we will up. firm

Dick Ryan

what opportunity? you of opportunity up were your Pete, and were that that. you with didn't to the that were – Okay, being as million text, Was your last test about two $XX one you wrapping times total to referencing? talking $XX prepared million catch three one I just

Peter Gundermann

the we and big on it's to test these of exercises in And bigger a I side. come target know, test, environment, try we a quantify And lumps them. And the business on where Yeah, side what a I weight call try pretty opportunities both go rich the was referring to to and target, we side. to semi especially you piece A&D through tend probability number.

the in – out. targets, I be these for not win will the history, So We're expect And not think them. guidance there. it ones some be we going took It's this will realistically of we meaningful. questions win of to the we initial some of kind given including we all and just but they're

where So the end low trying where to might the I might for be. be was higher end bracket and it

Dick Ryan

you. thank Okay,

Peter Gundermann

one XX%. was XX% one was customers, there XX% Dick, two were and So,

Dick Ryan

you. Thank great. Okay,

Peter Gundermann

aerospace. Both in the

Dick Ryan

Aerospace, great, thanks.

Operator

from Please proceed question with Midwood next Cohen Our your David Capital. question. with comes

David Cohen

things is some of forecast. get just know was What quarter of and to of have the usually basically book any that revenue your quarter there make recognize fourth trying I backlog aren't the strength the to Yeah, backlog, sense for to a given sense. ship particular typical a is fourth fourth you magnitude amount you to and quarter in in sort relative into you have quarter your in

Dave Burney

is… This

Peter Gundermann

Go ahead.

Dave Burney

of book back look typical don't our at I our you’d lower think kind and is and To fourth is the at of get that I almost to of actually. ship, a ship, book and hit the know If over guidance within every It's about that to there the all the in end for certainly map. $XX ship win need book we we low-end the It's in million range which quarter, quarter. typical.

David Cohen

those of chunks clarify Okay. jet that’s those prepared five comment in some business And shifted of that the million, – not Peter, in just have The to is your may you remarks. are made, backlog? just

Peter Gundermann

of Some them are.

of is times certain off. customers One it’s a cases is requirements to just of there's up it, of on have the – a in program in we’re for, are them we need the some off lot pretty and technical part a job repercussions most product of or the of but frankly dependent of an firmed our a of order could them which in need a of on on have quick and do some matter cases to customers sign that portion particular based we getting It's in to sign to order getting of waiting that in accept customers most either matter backlog. off final nature sign

So are all backlog. there we of got out flown too. Those in a couple those

David Cohen

little to you’ve could but reference understanding made maybe for more And this, you Okay. last provide a question, folks.

different that guidance is So versus quarters? if level you’ve just quarters to confidence today from a back their well, your that a quarterly your mean, But how standpoint, could methodology targets? what your targets alters going different today row, in about describe annual – from past is methodology several you approach prior I that

Peter Gundermann

we're we more side conservative primarily the getting past. bit a think in the on little than I have been test

built easy might many pick doing Forecasting an and figure program ship reasonably out Street how are bit look Journal to known we’re art XXXs multiplied the like, by it's what going It's a but at much harder set is Wall that. good and aftermarket be little up always quantity. to and of our see to

is or that sudden have nothing seen on business. of situation test the kind our test for perfectly sides for the of slide we aligned thought On that of or it of a kind that and side, year. often were an out Programs we we've all both disappear all may

So we're going earlier. say a conservative was what more to little there. I trying to be And that's

I business targets think next putting know doesn't is guidance I the good important upside other these you news the initial say and that confident for actually have with would booked or year way. out based it's on our you highly basically probability and we're that come know any are of when that there potential business

David Cohen

luck. Good guys. thanks Okay,

Peter Gundermann

Thanks.

Operator

next Wallace proceed Capital. with Pine Next our Please White with question your Mike from question. comes

Mike Wallace

you’re How David. Peter, hi, Yeah, doing?

Peter Gundermann

you? Good. How are

Dave Burney

Good.

Mike Wallace

just Revenue Minneapolis today. over in time. here we've And acquired acquisitions question. the of year some – in has and at amount changes of of XXXX. $XXX Good, stacked in fiscal high business that that what the peaked wondering Hey the we past on since were all a about with if day the just revenues kind million level the

Peter Gundermann

XXXX? Since,

Mike Wallace

Yeah.

Peter Gundermann

to one other is of And although was… acquisition of which major done only the business that was things. smaller that we've timeframe year would kinds I in the CCC, think driver happened this it those not have Well, a and date a

Deborah Pawlowski

of was Armstrong XXXX… January

Mike Wallace

XXXX…

Peter Gundermann

I going what was Right, to the say, that’s XXXX. early

then. into since there So really play that wouldn’t

Mike Wallace

CCC should bring? How Okay. much

Peter Gundermann

but $XX Oh, – under this that we’re million. still year to it’s figure trying out, been

Mike Wallace

$XX million, okay.

Peter Gundermann

In…

Mike Wallace

terms then revenue… in And of

Dave Burney

second it the about and $X For quarter, third combined. million was

Peter Gundermann

year this more. or maybe maybe Okay, million for $XX

Mike Wallace

most the going tech the what’s by recent And end? close we’re to year – one

Peter Gundermann

Telefonix.

Mike Wallace

run What’s rate there? the revenue

Peter Gundermann

be somewhere thinking in we’re year, to $XX million $XX next the million No, it'll range.

Mike Wallace

Okay.

on million $XXX about million rate fair. stack this cycle just that revenue seems that top $XXX might we of acquired So

Peter Gundermann

Well, from couple years the ago. a $XXX million is number a

Mike Wallace

turn. cyclical business looks you’re in you’re Right, going but now are really you're yeah, – starting things here and cycle a a like that through to

what out look You know two these the about like trying you company? to years then years… with attached revenues look could for profile and what I now two like am revenue think that And could margin businesses to

Peter Gundermann

Yeah…

Mike Wallace

You we're I and if you're the going think is cycle – you on cycle? this feeling this stronger looking through mean that? – know do at than What is you're that last

Peter Gundermann

a to about to thing cycle, try tricky you – you're if navigate. Well, know I it's the aerospace just talking

that strong it and has been be feeling and it's but business three Our to a base cycling. a two been really of continues years hasn't cycle or

I the test for really years. think fluctuations one the our that's compensating is been business hitting thing last of us couple the in over

would appear that's be So to a cycle.

more of just flow ebb I small relatively think orders the it's size. on and our

over strong, the I strong to a we're that. next certainly and to think get in XXXX going has been bigger and piece pretty think we'd going the of market is like beyond it forward

on we the in best because going for published if where on to I we're for two to just there you and too and an an range would there I or and gets think three typically the then want see Telefonix total to opportunities involved throw with thing we toward we the to we're be XXXX allocation target where be know where allocation pick XXXX to think guidance be and do going see on that that's get don't year rich throw that.

Mike Wallace

this and I be in of is This share in could million last. be that count earnings held the it peak the diluted fully cycle higher than it think, shares terms $XX like looks Yeah, really quarter? will

Peter Gundermann

right. that’s Yeah,

Mike Wallace

okay, good. Yeah,

some work color gives you. that. Thank I to appreciate me Okay, that with. think I

Peter Gundermann

Sure, thanks.

Mike Wallace

Okay.

Operator

Thank you.

with Louis proceed from your Please next Scott Louis with question Capital. comes Our question.

Scott Louis

Dave morning Good and Thanks. Pete, Deb.

Peter Gundermann

Good morning.

Scott Louis

bit and little bit of in Can current share the current Wi-Fi question. little talk Telefonix their a we a equipment market you Wi-Fi penetration got and that the rate I’ve market think maybe Well, share about a may about go.

Peter Gundermann

Sure, that’s big question. a

streaming I of Wi-Fi, it are talking you content about know where or the the is both? you kind would we think get Scott I say you're way answer or and about is access you’re when talking into

Scott Louis

what is Telefonix selling. just depending Well on

share for So be what are and what you market can about the your is and kind equivalent where for of Power talk would penetrations Telefonix? In-Seat

Peter Gundermann

that think IFE it's wasn't it's common builds comes frankly. USB but understand comes know new now or obsoleted be go a the today USB and today. will is just I tell an though kind the you that of to that in them XX% later. overall a apologies the from limb and right is Telefonix with I mean are in have share companies. But and power there it's USB others taking the markets corrections something really have XX% we once I'll technology of I would very as higher like they It a it ago, afterwards question – the the reality what some Okay, really continues And important that with because on especially a and are years equipped very, share more and that the latest the give generation probably dramatically. guess when that's relatively there in over end check they're they they tricky by market it is compete products we to market change and established away five they not happening is products. of changing offer increasingly world airplane scope high that to that a comes products that maybe very answer and new they're in, out because and share are thing power, with you to one to our to

power. So communication or to it there's about when file servers protocols points, evolution more the technology When as talking even antenna comes and tried electrical something or quickly. moves systems or you even as true start access

technology the we on guess where of of market say get access. airplanes, relatively replaced are years, power likely only to a largely rebuilt, there of put would this than them it it likelihood is kind an changed five, of but upgraded on I third do like even question or I and are look thirty and of are obviously, who timeframe ballgame stay of aircraft There the years. I put lot on terms at will the substantially in originally And or seven that challenges that out our one you would second me a was times where And business. a airplane's this the we brakes and I the different top opportunities those work course lot inning. of like of as it's that internet systems airplanes to of to in core and terms maybe life is cycle think kind of Wi-Fi have over somewhere nothing way for something it's yet gets in in short life. designed some of and not get So but untapped A we're

Scott Louis

Thanks, you, okay. Got Pete.

Peter Gundermann

thanks. Sure,

Operator

At to turn back for this to time, I’d call closing comments. like management over the

Peter Gundermann

No our with We forward closing comments. you right. full time expectations XXXX for when Obviously, to your Good interest. Bye. look here. is in the hands Have Thank we got good to for you. updating be a QX our day.

Operator

teleconference. conclude today's Thank does you. This

at this and for thank your may You lines time disconnect participation. you your