Albany International (AIN)

Bill Higgins President, Chief Executive Officer
Stephen Nolan Chief Financial Officer, Treasurer
John Hobbs Director, Investor Relations
Pete Skibitski Alembic Global
Peter Arment Baird
John Franzreb Sidoti & Company
Gautam Khanna Cowen
Michael Ciarmoli Truist Securities
Call transcript
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Ladies and gentlemen, thank you for standing by. Welcome to the Albany International first quarter earnings call. At this time, your telephone lines are in a listen-only mode. Later, there will be an opportunity for questions and answers, with instructions given at that time.

If you should require assistance during your call, please press star then zero and an AT&T specialist will assist you offline.

conference is your recorded. reminder, a call being today As over the host, Hobbs. I turn call to John will now Relations, conference your Investor Director of ahead, Go please.

John Hobbs

you to everyone. XXXX Thank call. good first conference International’s quarter Welcome and Alan, Albany morning

non-GAAP our the use of As to measures please GAAP. a the financial night our release our listening Contained of results. regarding last refer quarterly issued is call, financial associated a forward-looking release in their those the reconciliation reminder detailing for certain statements on and press the and notice text to

statements of to Today For conference that pandemic a the Ukraine purposes potential this make invasion our risks uncertainties, the will Russian verbal call, our of on financial are morning. and those the we the among this results. of same that the contain number which are apply serve of effects remarks forward-looking statements our and the potential operations, markets effects and COVID-XX we of

including non-GAAP earnings our release comparable including XX, a refer filings, our GAAP both For most XX-K. a as well to XXXX reconciliation measures, their our may full measures use of the to of SEC discussion, please call on as we April

President turn opening over Bill I’ll and will to Now who Chief remarks. Higgins, call Officer, our Executive the provide Bill?

Bill Higgins

morning. Stephen on results and first governance, our quarter Thank cover you for strategic and I’ll comment and more of then Good everyone corporate in you joining John. call our thank results, Welcome Today our first detail. XXXX. earnings will progress financial our

resistance has business the Like our an war hope invasion. the many Ukrainian express comes we soon. to and the in following the companies, this Russian inspiring and First, of will concern people doing Albany for is senseless let ceased Russia. of Ukraine end people The me

companies we paper in stopped belts belts small a from machine that very have paper Russia Russia local manufacturers. joint to venture shipping we’re in and produced withdrawing clothing Specifically, for

Ukraine Our is in small. business exposure

amount in those modest a on forward Stephen to making export combined there, support we had The paper our we employees future. and no of have customers quarter customers machine there, the typically outline. impact a will first to results, which We look continuing minor effects and clothing to

outlook XXXX I’m unpredictable to both XXXX Suffice which strong the pleased started may effects report out say year already has business moving in sales another quarter it Russian forward. as in to assumes the events, visible Despite entirely first the segments. not Our environment, unpredictable no with revenue growth of yet. our be

to of machine digit composite quarter quarter, net per Most In share, and and materials of by our adaptive and up $X.XX per In our growth segment be segment and results. share of factory to supply posted last produced fact, see $X.XX our is machine output. of per share a on and continue of excellent time, material our and hit to took work globe This to on for to the chain our operations EPS delays material $X.XX grew mid-single levels logistics suppliers adjusted shortages impressive $X.XX the but delivered improved compared deliver productivity, sales from adjusted year’s EPS achieved re-planning challenges, to customers GAAP $X.XX, aerospace per last share year. EPS to the output, across ability example, clothing lot teams’ than still first together we first while record from time. share able versus we to XX% raw more difficult effort deliveries year. last overcome customers In clothing, absorption were to to financial rebalance working we capacity barriers, extra

performing that teams great exceptionally have are well. We

inflationary and logistics energy. and monitoring closely pressures we’re front, cost in wages, the actively On managing materials,

profitability our QX into we through increases to cost overall. for the can. and year Inflationary cost continued passing increases are where impact We’re expected

availability positive estimated Europe truck impacted home, transport returned the and example, China Truck transport, loss adding in has flexible. been and Europe. Europe For to is drivers the replaced [indiscernible] longer On and in of transportation of Ukrainian reduction doubling and contributing Russia across within driver to and quarantines, pandemic viable cost by boat transport time. rail is by XX% by who Western capacity is truck shipping stymied lockdowns from to nimble continue truck an note, no China a be

the Our have this years our challenges Despite and remarkably about agility the and first we’re opportunities. two chain of supply last teams their demonstrated optimistic growth the well. unpredictable navigating operations by quarter environment, global

partner the good must both and and we In leader This choice both we in R&D in with invest technology organic to to of machine drive and to segments. means at long growth, advanced of position strong term Albany operating generation next of growth, material our to to is culture. for design strategy and the product collaborate as a development performance. clothing, Our advanced operational developing customers key be materials have solutions

have products reputation a We exceptional for customers. durability earned our producing quality of and for

excellence and underlying economic reputation market renewable bring composite technology replaces to trends, generation and advanced for market next plastic. trends a the and composite achieved the of clothing, materials operational secular composite feasibility recyclable shift blades. a the earn exceed and durability with we our as long segment, and to activity, of and our service. paper strategy engine woven In great and leader the commercial our is development to paper in ecommerce materials XD blades engineered composites global fan blade LEAP of components. woven with We’re are to other fan of consistent: market expected towards customer performance performance Safran demonstrated of The demand whose term machine composites share or collaboration a cases. on grow of XD woven any with rates It fan commercial production titanium and in materials, high XD started XD Moreover,

LEAP XD springboard the a with across is success use propagate of to structures Our the woven aircraft.

the and a advanced aft climate CH-XXK aircraft. air of win, for as term LEAP variety for and partners. opportunities for positions into woven OEM future, preparing long foundation composites we’re production term rotary secular customers organic XD efficiency. Layered program In the programs growth. driven of long major up generation for Albany ramping lay X transition the the our next and the Tier with term the energy which Sikorski most strategy opportunities factory and advantage sustainable our helicopter, recent in and player by these the by near on term, takes The We’re engines on long excited and trends change a the frame

to of Our aim be shift this lighter fuel that aircraft is at center are the composite efficient. to

governance. recent our couple corporate of changes in about Now let me make a comments

pleased our Tony. Alvord of two to members First, welcome directors, to new we’re Christy board and Russell

They we’re strategic, of experience operational, board. part refreshment As leadership board process, technical join to Albany. our to and Russell the Christy have bring excited

their planning and experience in and aerospace, With technology, collective capability diversified strategic is enhanced. materials, our and manufacturing, growth governance global

transitioned Albany have a Class Second, outstanding share structure. effectively have now One Class have common been of equal and we stock converted all to A class is all to hundred voting percent share shares Class single now shareholders rights. therefore now B A,

XXXX. to Stephen. our dual formal retirement a will by-laws, vote With hand next to in to that, we Stephen? over class in structure the call bring the I’ll the be step which shareholder intend of Our

Stephen Nolan

for and Thank the the the on I an about our then Good of outlook business to morning year. balance update our everyone. you will first provide talk the Bill. for quarter results for

by by decline For $XXX.X translation In delivered net compared the increase all of the in company to currency for sales, for an currency principally last driven first dollar, million, again translation of F-XX euro quarter. the in machine net platform. year-over-year effects, Engineered clothing, composites million total grew decline same a the and the to partially the quarter, on XX.X% currency effects, CH-XXK growth U.S. adjusting sales up net year-over-year, quarter were on sales the after adjusting XX.X% $XXX.X also X.X% the growth by increased effects, product. by relative translation X.X% sales LEAP in with Adjusting grades were in for net year. offset

of in to year. same engine the also revenue have under program sequentially $XX XB of the During the levels last goods. compared the quarter revenue stock the LEAP under in XXX up with line million contract. than now safety QX less required de-stocking with little our stock, our planned LEAP in we quarter, LEAP $XX finished generated finished a as chipsets completed million almost significantly was We

of profit margin quarter year. was line MC last and First for gross due $XX.X increase overall The caused by mix a XX.X% shift to sales, by of gross XXX the top mainly million, declined that net in comparable segment the from the AEC. of an lower outpacing to AEC’s growth company X.X% XX.X% margin period basis points the gross from

the customers. of had higher and of margin to for larger net about WIP Russian long been was contract Within margin a gross offset gross segment, $XXX,XXX sales drop-through of unfavorable WIP MC XX.X% to fully flat effects, slightly sales, change finished the reserving revenue primarily as net input XX.X% benefit the that term goods net reserve, at and raw by and by destined was costs fully mix material of Within caused profitability. XX.X% declined AEC, and from increased

determined a to at useful with life. raw consumed was stored effectively storage temperature third fluctuations material that quarter, facility have the During been party held its inappropriately

the which reserve While initiatives To pursue raw of incorporated. determination QX future successful loss, the suspect material and been in the we reduce would that we our recovery appropriately. reserve options the WIP a some are at made into $X.X all of or our to recovery for we for the time in that the quarter, material will million extent had

million increased expenses XX.X%, by net higher $XX.X XX.X% decision quarter exit First from increased the to a the research sales Russian impact from and of percentage million market technical, in in R&D and year and quarter $XX.X current quarter primarily expenses. selling, caused the the general to prior our as of to

foreign being rate same this the the year. $XXX,XXX was higher million more gross primarily $X.X of clothing write-down small by operating our quarter, During million, period by by Russian customers. and a and million in quarter currency reserved $X.XX higher of receivables or slightly last flat was intention decreased income and stake adjusted $XX.X joint same for beneficial market, rate last $XX.X of in last this and from partner clothing in discrete or XX.X% profit compared estimated tax EBITDA and of adjusted expenses; in recognized to in revaluation quarter quarter, the year. income by net caused share expense of in the the The $XX.X higher the offset recent quarter compared Machine $XXX,XXX more of quarter quarter down by or expenses other quarter $X.X down primarily per were paper and associated was of payments quarter. in the from provided netted our year. $X.XX was our rate to and Machine meanwhile, the about effect net change year’s was million year net expense. by adjusted XX.X% sales expense operating than to net lower decreased about Other of caused prior a to restructuring offset Net absence EBITDA income income tax from lower fully last the million $X.XX XX.X% year income last company quarter. operating After tax fully million the STG&R have AEC profit gross attributable exit higher net for partially in operating sales, favorable year machine the period only The to $X.X of the compared of to our up $X.XX to foreign driven $XXX,XXX Russian gains million, to venture to year. sales. by quarter. our expenses, STG&R notice to in million higher of company acquisition $XX to Total about was essentially partially for of latter, improvement Earnings in share clothing this expense. Adjusted XX.X% currency income the and the prior income the this the to $XX.X the exiting per With impact XX.X% year value about $XX.X adjusting income million $XX.X compared beneficial CirComp increased restructuring same respect integration, quarter impact we The by venture. $XX.X was the losses, EBITDA million earnings prior the last for the revaluation compared the this AEC as true-up quarter with offset the of from sales the most this or joint that last relationship. compared book was is to income year, equity million due period XX.X% first the year. in Russian we for

net capital and negative During cash million. to the had receipts about in used was past cash all payments negative the cash the quarter year. as expenditures the operating in incentive the quarter, have company for as $XX.X typical of for not in company is defined free compensation seasonality performance unexpected in flow, This first flow at activities due less it to

This cash change quarter’s for flow performance for cash flow full year. our free does the not outlook

during Share repurchases. During the quarter in our over first investors, dividends shares over $XX an the continued million of at in of have first price QX. $XX.XX. share and returned to repurchased $XX million $X regular average quarter, repurchases million cash we comprised almost XXX,XXX in of almost We

talked X.XX, return good on a with investments provides on about weak and had input without to to our make XXXX. clothing the up euro; arise. including very opportunity shareholders prior we a headwinds guidance an of in risks our should still cost now to we more the financial about balance like impairing continue the than however, update is top to now provide which flexibility the for ratio increases leverage cash significant of net for making see I line would strong some year. strategic the to an us call, ability Our Machine quarter

that saw the quarter unlikely in underlying customer by is the the European requirements. demand sales drop-through. growth as we certain saw the we this is through challenge that do offset of fact quarters, by be exceeded exacerbated expect high impact input believe cost that timing rising. still In will level it year revenue we fully to continue and is and driving North future this revenue both American inflation the at the we First, driven was able markets same not of This higher to inflation performance increased

XX initial bottom inflation the line segment’s weeks of assessment fact, the for In year risen guidance issued our XXXX, in million. has by $X financial the impact about our since of the for we on full

have than risk our facilities, customers Second, stock chain supply Many of of cycle the call disruptions. our discussed continued de-stocking remains. higher future finished last at operate safety driven their the we of on normal goods fear to of our with by

the in the extent and the in the including risk invasion abate and fears in manifest first possible Given We Ukraine did resulting see or is of revenue, of but those know impacts global events, we do will sanctions, some still XXXX. quarter. that the not environment of pandemic, to itself inflationary when lingering impact our terms impact it not what to will

per in our Russia’s $XX challenges year. in Russian tragedy resulting Direct and quarter first reserves and of the that we new Third, approximately from the we have the sales write-offs unfolding of the both impacts recognized and of market invasion there. is from million the include exit loss that Ukraine

there to Europe. indirect products, between supply cost to effects time disruptions availability Potential our significant. noted, and options also end such our this be or Asia but Bill As for customers’ demand and could on unknown the are as have of shipping impacts, global significant at chain been

of a result, and net EBITDA million our maintaining are million to adjusted $XXX $XXX guidance issued As of to we million. million previously for $XXX segment sales $XXX

market. possible impact or direct supply assess in risks to that or of could there Russia-sourced the not meaningful from do disruptions impact size while time, of recovery the meaningful no and potential customers impact secondary as their outlook. could these impacts are segment on that Ukraine the has the chains are it notably regime the almost no sanction engineered segment to probability aerospace economic not performance, see the those XXXX disrupt elsewhere expect composites, most At however, we risks top the is this our Turning segment’s conflict our on the of seeing Russia’s in global risks, the of line from invasion revenue; we

The we fixed that from see notably meant underlying lower first most the profitability gross quarter segment higher the revenue an not on as program, did price This the some the new perspective and improvement and combined quarter R&D in the from any related challenging programs, margin F-XX EBITDA for with on to compared last material previously to business us an revenue pursuits year. under reserve adjusted effect in announced higher margin this raw temporarily investments the caused XX%. deliver was

expect of XX% maintaining we segment over the most For segment, level, adjusted to per to $XX the $XXX $XX million revenue updated the range $XX income adjusted therefore full of of guidance year, are between challenging earnings $XXX million. GAAP also million issued our still company as prior deliver million in $X.XX, we between million, of expenditures rate and $XXX million EBITDA and of guidance maintaining EBITDA $XXX of and between remain share adjusted full $X.XX per earnings margin XX% environment. an unchanged, our a of unchanged, EBITDA unchanged, $X.XX the effective it million from of to follows: present, for million guidance million million $XXX revenue between depreciation of $X.XX share total of does adjusted the and and and amortization and and of are to of also $XXX unchanged. $XX we to $XX to XX% At million unchanged, tax capital previously $X.XX between year $X.XX unchanged, for Returning

and chain effects and our of production to have it the have Through inflationary had crisis. performed human Ukrainian admirably, who have MAX the employees Over environment, manage now to our The management, the debt grounding, every With of particularly new all, their the deal employees all had resources three the our personnel XXX the years, open has supply with hard the our their brought week past for questions. that, to challenges. work, diligence would employees safety. like and of call gratitude owes Alan? at their all constantly a a for and persistence, environment company through times commitment where changing to pandemic, I


with [Operator of instructions] Pete to Skibitski line first the Go Global. ahead. go We’ll Alembic

Pete Skibitski

you like seemed over wondering particular, in the or really visibility so the really There’s AEC for chipsets all anyway, XXX LEAD it or that quarter, ramp so the in like accepting point. to on end at if [Indiscernible] continue and I’m seem does maybe LEAP? was ramp on strong, that China think deliveries good from systems some about go it questions not, but is your

Stephen Nolan

we the we expect saw before probably this Pete as selling end now, your I’m think insight sorry, Safran last and of be is at not reopening, part sure some up our direct our is comparable balance Safran, right at in chips We future I fairly - but sure market you’re the the certainly the Right outlook as now, don’t missed produced, - outlook aircraft, know, I of on QX I’m number to market, would We of that AXXXs to be some you’re Yes, of XXXs what crisis. I customer, range although if the first get your LEAP, quite that think not compared year single into number you the total talking we will certainly clearly said, I we feel was know, this XXX first the in at has. question. it significant at things, and right - as Look Chinese to units our I there of significantly that question, referenced, for least heavily into gist total couple of the we got shipments the but would regular quarter, in for is you good. say point about year. demand or have least. a aisle at outlook dependent directional am of it. we quantities that it’s point as updates from their that much

I it’s year. significant are should think get this say, I but As outlook don’t we for there more hazy--or XXXX, hazy, risks into our to less

Pete Skibitski

guys How the economy One it. also and China you one kind to machine clothing, then the global slowdown think staple potential and about of you from the if will, the in revenue-wise concerns late late in that meaningful a with to slowing? is your year machine for clothing, got mixed historically product, inventory you Okay, are modestly it viewed for the impacts sort the thoughts the recession are much potential some How quarter, on next a year, this the are so with maybe global lockdowns as discretionary. next sort or I there as of with negatively thinking today? this back, look year, been I partially me related in regards see machine think a clothing economy the China. last of about maybe channel, what and if at you least in potential record, early a of I for year, It’s

Bill Higgins

Pete, let with me start Yes that.

been clothing So with fact, we in has far, performed well, were up addition seeing and facilities any China good. effects them have extending so across keep--in are the other Beijing again solid Shanghai lockdowns now. We’ve asking we been able our remarkably right now in machine feels keep so we to China It and far last night, to pretty running. in and operating, places,

yet. I chain transport into so now delays, these war strong, we probably interruptions clothing that particularly us machine affecting has inventory this of recession, solid think happens Packaging know North there just questions see in those continue evidence risk answers for I been any a but go and built the while don’t mentioned because, customers but year. a the we have seeing we the mitigation. we’ve America. just we pandemic, commentary, as been supply go the we’re to we for because effect, MAX, to a in that now term, bit recession, is What don’t the the like of we into longer hope looks China through pretty up in I’d will are big as and longer it the watching think and bottlenecks tissue extra That think we’re little

Stephen Nolan

the extra out the to of in of we the is probably slowdown, that the level. there is kind to were inventory, presumably of of of see question total excess there risk size in our product millions channel about your immediate some be first, dollars There consumed product in to tens probably--Pete, would

say, than of staple more muted a pulp much as members paper a cycle products. do chain, capital-intensive As are many which but consumable are you more the product a we and product, we supply see providing

out, Our and look prior consumed muted the even belts at prior is cycles, business. down, while many economic wear it it goes a you cyclical volume clearly more cycle industries. cycles, during than It’s cyclical a much

Pete Skibitski

Yes so tens XX% mean, clothing of Steve, your That’s millions, that’s on machine order of-- of revenue. of I kind the

Stephen Nolan

I wouldn’t high say as as XX%.

Pete Skibitski

right, guys. okay. Okay, thanks All so much,


Baird. to next the we’ll question, Peter Go ahead, our For with Arment line of please. go

Peter Arment

North some it’d thinking or, you second on Yes, look just bit year just at good shipments Europe. it How seasonality, on on cadence? think Morning question we about MC Do number little when like on about the second what seems little sequentially always a top kind quarter line America you growing asking quarter timing My Stephen. a tough bit your was we’re and there some know, just was still and be Bill year-over-year last of the really Pete on stronger, has is circling be the I a top with the you wondering, MC, been guess on in we and line. morning. historically, mentioned cadence. should

Bill Higgins

for I holding we’re guidance, steady. we’re looking big pretty that feel know mean, Yes, things growth. I don’t our

think solid, we but I feel like into we’re don’t good quarter shape, here. in a think are bookings the Our expecting we’re so big step-up pretty I coming

Stephen Nolan

says, into a second heading quarter, try not to position Yes involved in guidance, are as quarterly Peter, get giving we the we in strong certainly. Bill but

strong, than it expect last to weaker as albeit expecting to time it have see tough another Our continue order is blowout year, well a balance on QX same book comp. you the it’s--we quarter, a perform mentioned, but, little might is at been probably so

Peter Arment

really continues wondered. you a Yes, the just dollar kind okay. on to that on a I lot currencies around us Stephen, exposure of--the other little bit, what That’s FX, world, obviously remind strengthen helpful. of against just your Then front? can is

Stephen Nolan

euros the to a in of an $XXX rate. average the terms drag against with over the line, we euro see Yes, $X.XX at have the Last clearly had year, we so of euro, million down. having sales close come we euro-dollar in exchange top

that down a know, quite in but $X.XX, $X.XX you range of north little at we’re Now, times. bounces parity, - it around down frankly

$XXX euro line, top still over $XX round line million the numbers bottom level, at in close say, long range. the million; So we’re probably, let’s to that,

As impact to the we’ve year of line. at that that, the decrease $X you look seen north of will in million bottom this over euro, drive XX% the

Peter Arment

so much. Great, thanks


Our next question ahead. will the come John Go from Sidoti & line Company. of Franzreb with

John Franzreb

Good morning guys.

bringing [indiscernible] Are staffing I’m board? on people curious segments. cost, inflationary looks kind staffed Just between two like what your you or the of still fully about level are you on having any troubles

Bill Higgins

John. very we’re in well, we’re going staffed, production tight production the we both the building growth say labor for so adding in facility where we’re adding look exit for staffing to would folks then clothing, as AEC, next quickly are we machine we’re Salt CH-XXK future, into folks and Lake in year markets. the In as there people fully year, City, I LEAP up this as

John Franzreb

do expect be you And that when Bill? to done,

Bill Higgins

think go of Well, year. most the next LEAP CH-XXK production, I The this is it will into year. probably

John Franzreb


out question, much you deferred the back say go you to the revenue fully did operational. to quarter maybe or because any, was was first how Just second, there I missed were it, of the into China

Stephen Nolan

impact either or any operational fully we in we see nor and to first did their quarter, are customers, our In their demand the operations China, material first quarter.

There be China with at For not results, COVID there say impact the about in current seeing news on us, revenue. going impacts what’s there that first there Shanghai no could lockdown was not was by time, know, clearly--you quarter is we un-impacted on relatively other the to of to to spreading no some it saw deferred QX cities kind recently, certainly most our is but stringent to and QX.

John Franzreb

guys. thanks Great, appreciate it. I


the ahead, Go question will with come line of next Gautam Cowen. please. Our Khanna from

Gautam Khanna

Safran repeated a I wonder changed is and XXXX? forward have question, Are XXXX do visibility so get much guys going, of it from has with you That’s may guys? about last over you still for that how LEAP on they those. firm product how how’s kind months deliveries on total Hi, pardon schedule? the but LEAP a six missed the of far my have, first how that talked the question. this, forecast ask just I of you that XB comfortable I if guys around

Bill Higgins

Boeing’s and with the I year, Yes, directly bit; our January, it’s some it We set seeing the work what isn’t that motion production plan that it be kick maybe quite We is little like we’ve a to production in to might a Safran got Gautam, in year. changed out think to to on doing, going what pandemic context, so with in production we’re so linked or the Boeing. agreed that engine shipments. Safran for hit, working pretty with off, plan this we’re years, that steady, different it when you’re a but even than

Gautam Khanna

guys well industrial prepreg don’t you we are Has the of resins those carbon sourcing, is a of inflation of impacted any and fiber product inflation that down. Okay, then and the you resins things has that inputs? companies in hear is sourced the and that in all from see availability one number or come of

Bill Higgins

up machine needs size shore polymers, actually helping very polymers, the of some buy ramping whatnot, we different teams, there. OEMs to as job, large materials MC. because own a buy segments we that daily--it’s inflation, of seeing goes chemistries managing yarns were book our amazing we’re both in are could a are reviews our resins the custom products you and when Sikorsky have In cost on It’s inflation so machine it. We internal production of and Generally Both AEC seeing sit XX/X with are made, - on and clothing on AEC the the Then in we work and you into I we a that write mentioned. are and side, manufacture a and our in and to of lot up if that chain supply so Safran, going. clothing keeping types production effort our all business we’re materials. with us we segment,

Stephen Nolan

from master most use it’s carbon entered we fiber, the there AEC, term end with raw under by are a that a the prepreg or for and of a resins, lot agents, goes Yes, are bit the our under materials long completely. little inflation in release that item finished carbon customers non-end that item as to open insulated just those procuring we vacuum else contracts not under materials, whether into the end those the fiber are suppliers of company; raw suppliers bags, inflation, along AEC, the customers contracts parts, just but in market buying are in item gloves, we customers, to of they’re are those be other subject we, raw product, Certainly of that and contract. any we’re like our say, lot I buying agreements, are and it bought making on on everything the negotiate and impact with so whether materials,

Gautam Khanna

a are yet talk queues you uptick you production for on have in any to year, guys? Then are bit seen little you de-stock, that the where XXX, can about expectations what helpful. in your and very we That’s

Bill Higgins

for we have sort just in Yes, don’t it plan warm, of the because the we’re it running commentary keep and that’s the this to year. line

We little have for this year. the in plan very

Stephen Nolan

million, last revenue view little under in so XX, we year essentially on the it’s quarter because quarter to and that so to close XXX Our flat quarter. noisy finished a as it’s--you was $X Gautam, know,

at right seeing is lowest the It operate no level keep are warm, We uptick possible. now. line the

Gautam Khanna

one clothing are last own infrastructure risk. outside are know on that there it create any may We their I one. to Great, it? machine a and forthcoming don’t as want customers Is that created your region of of the about - negative? the sourcing is side, opportunities Russia-Ukraine a Russia-Ukraine any just potential by talked or

Bill Higgins

any don’t from see was any down probably point. been It’s ended, see the Russian North very Finland at strong. I the to Europe America I little upside more. don’t bit this has see that invasion. opportunity a in but slowed strike I happy

Gautam Khanna

Thanks guys.

Stephen Nolan

Thank you Gautam.


next line Michael Truist Go from Our ahead. of will Securities. come Ciarmoli question the with

Michael Ciarmoli

the taking much It around is for machine you’ve why to questions guidance? headwind, Thanks biased guys. Bill significantly the Stephen, your not the seems commentary lower or seemingly morning like there. got the downside the more good all clothing Hey, here. Russian increasing, commentary risks

Stephen Nolan

stay range. it’s quarter good same us strong which to a first Mike, frankly we some risk a had that puts very and in Well, the of allows It’s certainly within guidance us covers also--quite position, QX.

through many be stage. it segment sure There direction guidance unfold, uncertainties a changing at about on the We’re are in for early year. are some little either unless the thinking Unless feels going we’re in to them quarter quite balance is very year. something the either of sure of to this how

Michael Ciarmoli

that’s Okay, fair.

calling risks. in your You those level talked going looking things more ask and change and What given about with there? kind million what’s Any by back the bit in to changed out just sentiment inflation again AEC kind here? in revenue anything it. just of of world I’d rising on about--has Figured ’XX, $XXX getting a the still confidence hazy

Stephen Nolan

more months that’s the global just there’s that clearly not No invasion we’re ourselves, spoke two Mike. Sure, sentiment making than ago, change. ago? half Is uncertainty statement two and place, regime we last with sanctions and we--certainly half kicking in when uncertainty and the global now months regretting but there a a right more

obviously we unfolds, think see in we’ll and give feel months. good generally still this year nine together get and how you that when XXXX guidance about for we’ll better we I

Bill Higgins

got recent the term some year, some us. the commentary, other number, are working most taking in last getting talked a about the being optimistic collaboration of our hypersonics longer so that just talked we programs--we’ve Spirit I off as on think that said ones we’ve we that I haven’t with in front growth talked There CH-XXK the longer my view, ground. because optimistic we’re we’re about, we’re about win,

Michael Ciarmoli

one the I makes the quarter. more, Then margins, it, Got AEC just obviously sense. in just weaker can, on if

You margins? to talked those programs through of in of may Is guess, of the move to year sound terms volume fighter a specifically, be about to the Is the drive margin and ramping? going and strike to doesn’t in here? joint the like drive have it presumably XX%, is assets some What’s continued on take it I guess as been we contributor. strike the EBITDA joint going LEAP? What’s XXX some certainly it going sounded like I the It it write-down there. under-absorption fighter,

Stephen Nolan

to quarter, let’s we Yes, during little the if say, gets this from that that. F-XX to just close our that not of driven you a half enough, you to was look, quarter. halfway over there shortfall, be issue. roughly XX% Mike, at half absence had material rest, the on reserve level should issue, The it raw or repeating from and low so particularly the as us WIP say, of a take it related being was that back That by really this

plan today, is programs that me very a XX% in recovery seeing for to beyond is dependent getting doesn’t require day segment, it days. to enormous some--and not EBITDA I’m do Herculean easy effort, in enormous I Our effort we’re guys back so the on think operating for not it’s every But say what sure the Herculean these requires a leaps.

assumptions solid heroic It’s seeing what log, delivering that, the we’re to path Mike. but demand beyond to I’m think on around get solid not to falling certainly is some off We’re path market. the trends in without a that a already saying, a we’re there’s like

Michael Ciarmoli

guys. jump got it, back I’ll in thanks Makes Got sense, it. the queue.

Stephen Nolan

Mike. Thanks


if a on Alembic question. gentlemen, Pete questions, go line with touchtone of have press at next follow-up As this to you the Global then ladies one reminder, zero a your We’ll do for phone and time. Skibitski

Pete Skibitski

that--beyond like one want hypersonic looks Since just budget and outlook, soon could know little general I updated but of follow-up, and for the better just missile missiles think hypersonic think the we we I to on testing touched in growth we category thoughts think be going your now story there’s get soon you how on--Bill, guys. part a across in it have JASSM, a should been particular. a industry, I you? Yes, missiles should on the defense how I guess,

Bill Higgins

We’ve on year. now, probably I that so. color It’s of go towards still end into that. year, got the a ways on development could program to the a right more next give

Stephen Nolan

expect anything about I material plans the some us would into not meaningful toward Look, certainly are there, XX months, say, revenue say that decade of middle but the over XX we companies talking months. for will testing without the can’t programs to production see where could XX publicly we saying revenue. some out time there go hopefully before let’s period, next

Pete Skibitski

so. curious a a the is for color. areas, sensitive just just improved was I Thanks I know we Okay. visibility wanted had it’s a--I to outlook, since budget get had better

Bill Higgins



one no have this time. queue we in Speakers, else at

Bill Higgins

joining thank the for to like call everyone I’d today. well us right, All on

May We Boston. are an holding investor XX day in

the attend to to John event, reach of please register free out feel Director our to like you’d If Hobbs, Relations. to in-person Investor

continued appreciate Thank As a have your you in International. Albany always, good we day. interest and


will for for will the Ladies and for conference website. AT&T this call available using your on for gentlemen, conference replay be you the That International and today. call conclude teleconferencing. your Albany participation Thank event

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