Greetings, and welcome to the AerSale Inc. second quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star 0 on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kristen Gallagher. Thank you, ma'am. You may begin. Good afternoon. I'd like to welcome everyone to AerSale's second quarter 2023 earnings call. Conducting the call today are Nicolas Finazzo, Chief Executive Officer, and Martin Garmendia, Chief Financial Officer. Before we discuss this quarter's results, we want to remind you that all statements made on this call that do not relate to matters of historical fact should be considered forward-looking statements within the meaning of the federal securities laws, including statements regarding our current expectations for the business and our financial performance. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties, and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results. Important factors that could cause actual results to differ materially from forward-looking statements are discussed in the Risk Factors section of the company's annual report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission on March 7, 2023, and its other filings with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those indicated by the forward-looking statements on this call. We'll also refer to non-GAAP measures that we view as important in assessing the performance of our business. A reconciliation of those non-GAAP metrics to the nearest GAAP metric can be found in the earnings presentation materials made available on the Investor section of the AerSale website at ir.aersale.com. With that, I'll turn the call over to Nicolas Finazzo. Thank you, Kristen. Good afternoon, thank you for joining our call today. I'll begin with a brief overview of the quarter and provide operational updates before turning the call over to Martin to review the numbers in greater detail. Our consolidated second quarter results were behind our internal expectations, resulting primarily from current soft demand in the cargo market for our P2F converted 757 aircraft and extended repair times for used serviceable material, which you'll hear me refer to as USM. Total sales in the second quarter were $69.3 million, compared to the prior year of $139.6 million. This quarter included flight equipment sales of $13.3 million, compared to $92.5 million in the prior year. Aside from reduced flight equipment sales, revenue across most of the company's business units continued to grow, supported by a strong commercial environment and demand for our products and services. I would remind investors that the year-ago comparable period included record-high company revenue from the sale of multiple aircraft. As we have noted on each and every earnings call, flight equipment sales are an important component of our end-to-end solution, but do create meaningful quarterly volatility in sales and profitability. Further, we allocate fleet feedstock to the business unit that can achieve the highest, the highest risk-adjusted rates of return, whether that be through whole assets, leases, or USM Parts. Therefore, the sales channel can produce often additional volatility quarter to quarter. With that being said, I'm pleased to report that our acquisition of feedstock through the first half of 2023 has remained robust and on track with our expectations, having acquired or been awarded over $200 million of feedstock, compared to just $50 million in 2022. We've been using our balance sheet to acquire this favorably priced feedstock and the level of inventory on hand to fuel future profitability now stands at over $300 million, a record high. This is an important leading indicator of our future performance, giving us confidence that the second quarter of 2023 should be the low point of this recent cycle. Turning to profitability, adjusted EBITDA in the second quarter of 2023 was a loss of $540,000, compared to a gain of $41.1 million in the prior year period. The lower adjusted EBITDA margin observed in the period resulted from fewer aircraft sales, coupled with the expense of maintaining the strength of our multidimensional, fully integrated infrastructure at a high readiness level to support future growth. At the segment level, beginning with asset management, second quarter sales were $37.1 million, compared to $114.5 million in the prior year period, resulting from lower flight equipment sales and no aircraft on lease. In the current quarter, we sold a total of four engines and no aircraft, compared to three engines and three aircraft in the second quarter of 2022. Q2 of 2022 included two high-value, P2F-converted 757s and one 747 freighter, which set a company record for a single aircraft sale in terms of both revenue and total net dollar margin. We've continued to work through P2F conversions of our 757s, and our revised 2023 outlook calls for three sales and three leases by year-end, compared to our prior forecast, which include the sale of six P2F converted 757s and three leases. This reduction to our full year outlook is the result of a significant softening in the cargo market following the pandemic surge experienced over the past few years. Cargo operators currently suffering from reduced demand and an associated lack of liquidity, has tempered the sale of our P2F converted 757s, and will likely result in a heavier mix of leases versus sales in the near term. Together, these factors led us to reduce our full year estimates for flight equipment sales on the 757 program. While this changes our forecast for 2023, it is important to underscore that we still see ample opportunity to monetize this inventory through alternative sales channels at target margins consistent with those channels. In our USM Parts business, Airframe and Engine Part Sales both grew compared to the prior year, reflecting our heavy investment in USM being repaired regardless of the extended repair cycle times. The ability to use our balance sheet to offset supply chains delays is now paying off, as over the past six to nine months, the steady stream of USM flowing through the repair process is now yielding ready, high demand USM, which in many cases has been pre-sold while still in the repair cycle. In the second quarter of 2023, we had no aircraft leasing revenue as we fully wound down our aircraft lease portfolio in response to market dynamics. In the prior year, we had $2.1 million of revenue from aircraft on lease, primarily related to a 737 and 747 freighter that have since been sold. Comparing the sales mix of our products over time will yield varying results, as we're agnostic to the type of monetization strategy we utilize in our asset management business. We steadfastly seek to maximize return, maximize return on investment on feedstock through the highest return in current market conditions between USM Parts, leasing or the sale of whole assets. Turning to our Tech Ops segment, we reported second quarter 2023 sales of $32.3 million, which was up 28.7% compared to second quarter 2022 sales of $25.1 million. Higher sales resulted from strong demand for services at all our MROs, with additional on-airport MRO capacity at our Goodyear, Arizona facility, made available by outsourcing the 757 P2F program, together with increased utilization at all facilities. As mentioned earlier, we're seeing a favorable overall operating backdrop, we anticipate a meaningful step up in operating tempo as our investment in feedstock works its way through the broader system. Turning to engineered solutions, we continued to work towards final FAA approval of our Enhanced Flight Vision System, AerAware. If you recall, during our last quarter's earning call, final certification of the system will follow the completion of five sets of flight tests, proving different aspects of the system's performance and reliability. Although we successfully passed the first four, several imaging issues were identified that required minor modifications to both software and setup procedures to ensure the images projected onto our head-wearable displays align within the limits prescribed by the FAA. Identifying these issues and fine-tuning the system is part of the certification process and the reason for extensive flight testing. I'm pleased to report that we've made all the minor adjustments and modifications identified during flight testing, resulting in improved performance of the system and our readiness to demonstrate these adjustments to the FAA. Earlier this week, the FAA notified us that they have accepted these modifications and requested an in-person demonstration of the changes we made. This demonstration has tentatively been scheduled for the weeks commencing August 14th or 20th, subject to final paperwork and weather. Immediately following the demonstration, the 5th and final set of flight tests will commence and is expected to take approximately one week to complete. Assuming the successful completion of the final flight tests, the FAA typically issues an STC within 30 days. Turning to capital allocation, we remain in excellent financial condition to continue to fund our feedstock program and sustain business growth. In addition to over $200 million in feedstock closed under contract or LOI year to date, we ended the quarter with $34.6 million in cash and an undrawn $180 million revolver, which was recently upsized and expandable to $200 million, providing us with total current liquidity of $215 million. Further, as we begin to monetize the feedstock already acquired and coming available post-repair, this will enable further expansion of our acquisition strategy. Besides the acquisition of feedstock, we've been very active in pursuing M&A opportunities. While it's too soon to share any specifics, we're targeting capability-enhancing acquisitions that either complement our end-to-end solution, enhance our footprint, or increase our capabilities for engineered solutions. As is the case with feedstock acquisitions, we're extremely disciplined in our approach and will not overpay for an asset that has little post-closing synergy. To conclude, despite the disappointing short-term financial results and its impact on 2023's full year outlook, the fundamentals of our multidimensional and fully integrated business model bestows AerSale with a unique and unmatched platform to achieve significant growth in sales and profitability in the backdrop of a favorable and improving aftermarket. We're encouraged by the pace of our asset acquisition program, which, combined with the near-term approval of AerAware, should mark the second quarter as the low point in our future results. We've navigated through some pretty turbulent headwinds so far this year, but the investments we've been making have provided us with a tailwind as we move into the second half of the year and into 2024. I would like to thank all our employees for their dedication to AerSale and for their efforts in delivering on our commitments to all our stakeholders. Now, I'll turn the call over to Martin for a closer look at the numbers. Martin? Thanks, Nick. I will start with an overview of our second quarter financial performance and end with our updated guidance for 2023. Our second quarter revenue was $69.3 million, which included $13.3 million of flight equipment sales, comprised of only four engines and no aircraft. It included $92.5 million of flight equipment sales, consisting of three aircraft and three engines, out of which two aircraft were AerSale converted Boeing 757 freighter aircraft and the other a Boeing 747 freighter. Excluding whole engine and aircraft flight equipment, our base revenue continued to generate significant underlying growth. As we have pointed out during multiple earnings calls, flight equipment sales may significantly vary from quarter to quarter, and we believe monitoring our progress based on asset purchases and sales over the long term is a more appropriate measure of progress. Second quarter asset management revenue dropped 67.6% to $37.1 million because of the significant variation in year-over-year flight equipment sales noted above. Outside of flight equipment sales, used and parts sales improved from the year ago quarter as demand and availability of feedstock expanded, while aircraft leasing revenue fell due to a planned reduction in the number of aircraft in the leasing portfolio. Tech Ops revenue was up 28.7% to $32.3 million in the second quarter, from $25.1 million in the second quarter of 2022. Our Tech Ops business benefited from additional capacity dedicated to customer aircraft at our Goodyear on-airport MRO facility, as well as an increase in sales from our component MROs. As we have mentioned previously, the transition to third-party providers to perform the remaining 757 P2F conversions at the beginning of the fourth quarter of 2022 opened up capacity at our Goodyear facility. This transition has helped generate revenue and growth from expanding third-party services at our Goodyear MRO. Second quarter gross margin was 29.1%, compared to 39.4% in the second quarter of 2022, which was mainly the outcome of a sales mix that consisted of fewer high-margin flight equipment sales. Selling, general, and administrative expenses were $27.1 million in the second quarter of 2023, which included $3 million of non-cash equity-based compensation expenses. Selling general administrative expenses were $23.5 million in the second quarter of 2022 and included $3.9 million of non-cash equity-based compensation expenses. Second quarter loss from operations was $7 million, while income from operations was $31.5 million in the second quarter of 2022. Net loss was $2.7 million in the second quarter, compared to net income of $26.5 million in the second quarter of 2022. Adjusted for non-cash equity-based compensation, mark-to-market adjustment to the private warrant liability, facility relocation costs, and secondary issuance costs, second quarter adjusted net loss was $591,000. Adjusted net income was $31.7 million for the second quarter of 2022. Second quarter diluted loss per share was $0.08, compared to diluted earnings per share of $0.47 in the second quarter of 2022. Excluding the adjustments mentioned above, second quarter adjusted diluted loss per share was $0.03, compared to adjusted diluted earnings per share of $0.56 for the second quarter of 2022. Our adjusted EBITDA was a loss of $540,000 in the second quarter of 2023, compared to a gain of $41.1 million in the prior year period. The decline in adjusted EBITDA was largely a consequence of lower flight equipment sales, which had strong margins. Next, in terms of our cash flow matrix, cash used in operating activities was $129.2 million as a result of a gross investment of over $200 million in feedstock that will fuel growth opportunities going forward. We ended the quarter with $34.6 million of cash and an undrawn revolver credit facility, which we have recently renewed for a five-year period and upsized to $180 million, with the ability to expand up to $200 million. This additional capacity, as well as more attractive advanced and financing rates, will help us to continue to fuel our growth. Finally, moving to our updated guidance for 2023. We now expect to generate revenue of $400 million to $440 million and adjusted EBITDA of $40 million - $55 million in 2023. This updated guidance takes into account soft, softer freight market demand that is anticipated to delay our previous estimates of the delivery and sale of our Boeing 757 P2F converted aircraft. This guidance for 2023 does not include any potential sales of AerAware, as the product is in its final stages of approval and will be updated once the STC is issued, and AerSale can assess initial order and delivery schedules. Looking ahead, the long-term underlying fundamentals of our business remain robust. We are well positioned to capitalize on organic and inorganic opportunities and generate strong returns for our internal and external stakeholders going forward. With that, operator, we are ready to take questions. Thank you. We'll now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from Ken Herbert with RBC Capital Markets. Please go ahead. Hey, good afternoon, Nick and Martin. Good afternoon, Ken. Hey, Nick, maybe just to start off, as you look at the EBITDA guidance now for the full year, you know, it still implies obviously a pretty substantial step-up sequentially into the second half. You know, as we're sort of, you know, almost halfway through August here, can you just talk about the cadence we should expect maybe for the EBITDA in third to fourth quarter and sort of anything you could say around asset, asset activity here into the third quarter to help with confidence on the EBITDA? You want to answer that, or you want me to answer? Yeah, I'll start. I think we can say is we already have two Boeing 757s that are under contract that will be closing one in Q3 and Q4. In addition to that, we have several whole asset deals that are also already under contract. We noted that we are starting to see a pickup in the availability of USM material. In fact, of that material, already approximately $25 million of that material has already been pre-sold. That is giving us confidence on the strength of the second half. We still have a significant amount of additional inventory that's being flowed through and being made available for sale. With that notion, with the almost $200 million or the over $200 million of feedstock that we have right now, and based on the opportunities we're seeing in the commercial market, that's giving us the confidence that we will be increasing and that the second quarter will be the low point, and then we'll start going back to a more normal trajectory for the second half of the year. Okay, that's helpful. If I could, just on AerAware, it sounds like, you know, the FAA is comfortable with the, the proposed changes. It sounds like the, the, the demonstration flight should happen here in, in a couple of weeks. You're still confident, it sounds like in a, in a sort of STC this year, but just considering, you know, some of the challenges we've had on this program, maybe, Nick, if you can just walk through sort of how you'd characterize risk now on timing associated with AerAware, sort of relative to where we were coming out of the first quarter? Well, we, we, as you've, as we've discussed and I've mentioned during prior earnings calls, as the more we fly the airplane, the more little things pop up, some of which are actual issues and some of which are questions. You know, should it be displayed this way? Should it be this color? All throughout the process, we've made minor tweaks to the system to get it to basically make the FAA happier that it is displaying the way they want it to display. Even recently, one of the display issues that we saw was within limits, but the FAA didn't like it, and they asked us to get it, to make it better, and we found a way to make it better. That, unfortunately, that took a couple of months to get to that point, and we are to that point now. Every single item that's been identified by the FAA is: "Guys, can you change this? Can you make this better?" We've, we've done. You know, the last, the last two issues, we've done, we showed them in the lab that they work. We actually did flight testing to verify ourselves that, whatever, whatever adjustment the FAA wanted us to make, complies with their request and is within the limits that the FAA prescribes. We've done that all internally. The FAA is ready to... They're ready to start flying. They wanted to start flying on Tuesday of this week, but there's a lot of paperwork that we've got to that we've got to give the FAA to catch up to that. It is possible we'll start flying on next week, but if we don't have all the paperwork that we need to the FAA in time, it'll, it'll push back another week. Our expectation at this point, based on they're, they're pushing us now. "Hey, guys, we're ready to fly. Give us the paperwork we need and, and, let's, let's start flying." First thing that the FAA will do is to verify all these minor adjustments that we've made, that they've been told about, that they can actually see them, on the very first hour of flight. Long as they see that, I mean, we've seen it already, but as long as they see it, they're willing to go ahead and start, you know, on that same day, continue... You know, start on our, our last set of flight tests. Expectation is we will demonstrate to them that the adjustments we made are what they requested, what we've already seen, and we will roll it right into our final set of flight tests. When will that be? When will that be finished? I think that we've been told that to expect it, that there's about a week of flying that the FAA will want to see, and that could start as soon as next week or the week after. Just finally, Nick, on that final flight testing, the 5th set of tests, is that dependent upon certain weather conditions, or what, what would be the gating factors on timing that last set of test flights? We don't have to chase weather anymore. We've already proven the system works in weather. This is just a operate the airplane in a normal airline type environment. Start out in one city, fly to another city, go to another city, stop overnight, start the next day, you know, flying a different rotation to demonstrate to the FAA that the airplane is functioning, the pilots are able to use the system as they would if they were flying a normal airline type daily operation. It's really just to prove that over the period of time that they observe the airplane during the final set of flight testing, that everything works the way it's, the way it has been working, with the exception of the changes we've made, and that all of that continues to work throughout the duration of the flight testing. That's just the reliability portion of it. It's not necessarily... It's really not to prove the system does what it's supposed to do, it's to prove that the system works for that period of time without an issue. The risk is obviously if there's a mechanical problem with the airplane, which happens, then it had nothing to do with AerAware, that could delay, you know, if we have to fix it and we can't get it fixed overnight or quickly, that could delay the completion of those test flights. If something else were to come up, and we've put a lot of flying on this airplane, but if something else were to come up that nobody has seen at this point, and I don't expect anything to come up, but if it did, the FAA could then say, "guys, we saw something else, and we want us, we, we'd like, we want to understand that." It may not even be a true problem with the, with the, with the system. It just could be they don't understand it. That's, and we've seen that already, where we, where they thought things were incorrect, and we proved to them that it was within limits, but we made, you know, we ended up making it better as a result of, of their questioning some of these issues. Great. Thanks, Nick. I'll pass it back there. Okay. You're welcome, Ken. Our next question comes from Bert Subin with Stifel. Please go ahead. Hey, good afternoon, and thank you for the question. Maybe just following up there on AerAware. Nick, what do you think would have to happen for the FAA to reject an STC to say ultimately that this product is not allowed to go forward? Is that a possibility, or would it just become a timing issue where you just keep fixing problems in sort of the worst-case scenario? Well, because we're at the stage that we're at, we've already demonstrated the system performs the way the FAA has prescribed for an enhanced flight vision system. I, I don't see there being a risk that the system is not certifiable. The risk would be if we continue to have issues that come up where the FAA or whatever, maybe they don't understand how something is displaying a particular way. We see some other anomaly, we see a failure in the system, that the FAA says, "Okay, well, hey, you guys were supposed to prove this thing would operate reliably for a week, and we had a problem. Go back, figure out what the root cause analysis of the problem is or was. We want to see it, and we'll continue flying after we understand why did you have this problem?" We don't expect it, but it is possible. In that case, what I would expect is what we've incurred thus far, which is issues come up, FAA, FAA says, "Hey, explain this to me." We explain it, we show it to them, and then we keep flying. I think what it would do is it would stop. It could potentially, depending on the nature of the issue, it could stop flying at that point. We have to go back to the drawing board and fix the issue that, yeah, that was identified to the FAA's satisfaction and then continue from that point forward. I don't know, I don't know what could happen at this point for, for the FAA to say that the system is. You cannot prove the reliability of the system unless we just cannot fly the airplane for a week and not have a problem. I mean, if we just continue to fly the airplane with a problem after a problem, after a problem, after a problem, that would, that would, that could set us back quite a bit. Now, we haven't had that issue, and we've put over 300 hours on the airplane. You know, we have assurance, we have confidence based on the amount of time we've put on the airplane, that we're not likely to have, you know, repetitive, recurring problems in a short period of time. The issues that have been discovered have been discovered over a prolonged series of, you know, extensive series of flight testing, and some of which, some of which was never noticed after hundreds of hours of flight testing. There, the issues were so minor. Again, it's like, the better you make the system, the more perfect it is, the easier it is to identify anything that isn't as good as something else. I think that's where we're at. I mean, we keep finding little things that even are within limits, but they're not as good as you would think they could be, and we find that there's a way to fix them, make them even better, and that's what we've been doing. Maybe on the flip side of that question, if we were to assume the, you know, the fifth or final flight test were to take place the week of August 21st, I guess assuming that, that seems to be, that process seems to be pretty straightforward, where you're just flying, you know, simulating the typical flight, typical pilot experience. After that, assuming you were to, to get through that final test, you would assume or your expectation is that the FAA will convene and rule on an STC. Is that, is that fair? If everything were to go well through that period, you could have an STC, you know, by October 1st? I think that's what we've been told, that, you know, 30 days, with no more than 30 days after we successfully complete our final flight testing, we'll be in a position, they will be in a position to issue us our STC. Could it take longer? Sure, it could take longer. Should it take longer? No. Got it. Okay, maybe just shifting over to the Boeing 757s. Can you just give us an update on how we should think about timing? Correct me if I'm wrong, you said three sales are expected this year, and then three will be put onto, I guess, short-term leases, and the remaining five, I guess your expectation is the first half of 2024. Can you just give us some, an update on, on timing for the Boeing 757s or your expectation for timing? Sure. The three sales that are projected, as Martin mentioned earlier, one of them has already closed. It closed in the first quarter. Two more are under contract to close this year. We've got deposits, we've got signed contracts. The airplanes are being basically readied for delivery in the operator's livery. It's, those airplanes are committed. That's. Not to say we won't sell more, but at this point, it's unlike the last two years where we've, where we've basically had customers that wanted the aircraft, and it was our, it was our ability, our ability to make the sale was based on our ability to produce the aircraft and get it to the customer. Right now, we're hunting for customers. We're in a soft freight market. We, we have not anticipated or projected, I should say, more than the three aircraft we have already under contract. We're in the-- there's five months left of the year, a little over five months left in the year, although we are talking to people. Not to say that, that we couldn't find somebody that will take all the rest of the aircraft, 'cause we've, we've got multiple customers that we're talking to that would take one or all of the remaining aircraft. Just don't have anybody that signed a contract yet, and we're not far enough along for us to have a high level of confidence that we're going to be able to do that in the balance of this year. As far as availability of aircraft, we've got-- initially, we thought we would have nine aircraft available this year. One has already been sold, that would be eight. There are a number of the aircraft that are scheduled to be de-delivered out of conversion later in the year, in November or December, could push into the next year, and the ones that were scheduled prior to that could push into the later part of the year. It is possible we'll have as few as six airplanes in total this year available to sell or lease in this, in this calendar year. Basically, because of how late it is in the year that we expect to get maybe the fifth or the sixth airplane. Maybe we'll end up with, with seven, but it's tough when you're into the Thanksgiving, Christmas, New Year's period to be able to deliver aircraft to people for a whole variety of reasons. People are getting ready for the, you know, the, the, the holiday, you know, boom in freight. The FAA has issues on manpower availability due to vacation scheduling, and other jurisdictions as well. It is, as, as we get to the last couple of months of the year, especially middle of November on, it's just tough to get an airplane delivered if we get one in that time frame. That's, again, the reason why, A, demand is soft. Even if I had the demand today, I don't have the aircraft to deliver, but, but the demand is soft. That's going to push into next year. What do we expect to see next year? We expect to see opportunity to place these aircraft, excluding the ones that we're already talking to, to put on lease, potentially more aircraft on lease. If we don't sell them, we'll put the balance on lease. There's also considerations to look for other avenues to move this flight equipment. We don't have to just move flight equipment as a converted aircraft. We have options. We can, we can buy the conversion kits and defer the deliveries until later. We could sell or lease the engines, do the deliveries when the market recovers. I mean, look, the freight market is, you know, you've heard the canary in the coal mine, analogy. The freight market is soft today as a result of a very soft, consumer market for, for goods. You know, consumers stopped spending, really starting in the beginning of this year. You're seeing a, a much lesser demand for consumer products, which are, which are moved typically by air freight, and other means, but a lot of air freight moves those. That, that demand is, is down. As a result, the, the demand for these freighter aircraft today is down. However, just like freight is the first to suffer as consumer demand suffers, as consumer demand returns, freight is, you know, is the first to recover. You know, we expect as-- whether we go into any type of soft economic environment, and I, I don't even use the word recession or soft landing, because I don't know what it will be, if it will be, freight will be the first to come out. The later availability of these aircraft could dovetail well into demand, which we expect to improve as we get into 2024. You know, it's, it's our-- it's only a guess to know, you know, when we will see a dramatic improvement in cargo demand. It's-- I certainly don't see it this year. Got it. Okay, just a clarification, and then I'll, I'll pass it over. As we think about the guidance you put out there, you've already sold one of the 7 5 7, so you're assuming the other two that are under contract, plus three that go on to lease, and then the balance is USM stepping up on feedstock acquisitions? USM stepping up, continued growth on our MRO operations, both on-airport and off-airport. You know, component MRO is, is growing at a, at a very past, very fast pace. On-airport MRO has stayed strong, almost at capacity. You know, we'll be adding more capacity with our Millington facility in, in January. That's 2024, but, you know, we're, we're looking to find ways to continue to add, you know, additional labor to our on-airport MROs in both Goodyear and Roswell to increase the throughput from out of those facilities. We see. Thanks. We see USM picking up, we see on-airport MRO staying strong and growing. We see our component MRO business saying, you know, growing at a very fast clip. We see our landing gear MRO, you know, we could be getting into an issue with, with, with demand. With the amount of demand we're seeing on the, on the landing gear MRO side, that, you know, we'll have to figure out how do, how do we accommodate the, the demand, how do we gear up our capacity to accommodate the demand? Now, we have used third-party MROs to do landing gear work, and we'll continue to do that if we can't do it. You know, we're, we're very excited about our ability to grow our landing gear MRO. Not to mention AerAware, which we expect to get certified, and we expect to start seeing sales. Whether we get those this year or not, we didn't put any AerAware sales in our revised forecast, our guidance for 2023, yet that is still possible, but it wouldn't be of a scale that would make a material difference. Thanks, yep. Welcome. Our next question comes from Pete Osterland with Truist Securities. Please go ahead. Hey, Nick, and Martin. I'm on for Mike Ciarmoli this evening. Thanks for taking our question. Hey, good afternoon. Hey, first, just had a couple on the USM market. How much did your sales of USM grow year-over-year in the second quarter? Are there any particular areas or products where you saw relative strength for those sales? I'm gonna let Martin answer that, so he's, he's digging out his- The- Digging out his paper, so he doesn't have to remember. Yeah. Growth in USM for the quarter was up 12% overall, and that's kind of consistent with year to date, so it's running around 10%. Again, that's without the benefit of the feedstock that's currently being repaired, that we've had a bit of delay in, but we expect that growth to be stronger in the second half of the year. Let me elaborate a little further on that. As I mentioned, we've been using our balance sheet, really since the beginning of the year to acquire feedstock that is going through an extended, prolonged repair cycle. In many cases, as much as a multiple of time from what it used to take pre-COVID to get USM repaired and available for sale. We've been deploying cash to buy inventory or to buy feedstock that in some, you know, pieces of which will, will turn into USM, pushing it through the repair cycle, which is, which is very extended. The bulk of that material that we started buying last year, that was not related to the 757 program, was about $40 million last year. The $107 million, I think we announced in the first quarter, that we had under contract for the first quarter, we're just starting to see that material become available for sale now. We've had it. We, we put it through the process to get it in a position to turn into serviceable USM. We fed the repair cycle machine. We suffered through the delayed, you know, extended repair cycle, and we're just now starting to see the benefits of that. The, the relatively, you know, nominal improvement over last year in this quarter really is not a result, not a function of our, a lack of demand, it's a function of a lack of availability of the feedstock coming out of USM. Which is why we, which is why we have such strong confidence in the second half of the year and into, and into 2024, at the rate we're buying, that feedstock will... That we will see a substantial growth in our USM business. Because all that material we've invested in, in the repair cycle is now starting to come out, and it will continue to come out all through the year. I've said this before, and I stand by the statement: There is not enough good USM to satisfy the demand for USM. The key is, can you buy it at the right price, and can you stomach the long repair cycle that it takes to, to feed it into a repair machine and wait until you get it out, you know, two, three, four, five, six months later? Very helpful color. Thank you. I just wanted to ask one on AerAware as well. Just, assuming that the best case you talked about happens, and the STC is issued sometime near the end of third quarter or sometime in the fourth quarter, how quickly after that point could sales start to materialize? Are there any supply chain considerations here that would make sales initially ramp slowly, or is there a significant inventory of shipments that you could get ready to go soon after you get that approval? I can only speak for the installation kits that we have, and I can tell you that. A large order from, from an airline will require a very prolonged installation cycle, getting the aircraft ready for use of the system. It's just if you have an airline that's got hundreds of airplanes, there's just no way we can reconfigure all those airplanes to, to accept AerAware in a month. It's, it's gonna, it's gonna spread out over the, over the course of a year. Now, we've already. Our plan was to have over 100 kits available this year. We're, we're well underway. We'll, we'll probably do 150, 160 kits that we have this year. We'll be in a position by the end of this year to start installing, you know, 150+ kits starting this year and moving into 2024. Now, that's the kits, and we can certify an airplane with a few sets of rotable components from Elbit. Elbit has its own lead time issues. You know, they're a build-to-order company, I mean, as we are. You know, we're kind of getting ahead of it and making sure that we've got enough install kits to prime the pump and start getting airplanes capable of flying with the AerAware system installed. Elbit, when it gets an order, a large order, it will gear up its supply chain, which is just typical of the way these large OEMs do that supply these, this type of equipment. They'll gear up their supply chain as fast as they can. It's a big company. I don't know, $8 billion, $9 billion... I don't know exactly what the number is, but it's, it's a, you know, it's a multibillion-dollar company that has the capability and experience to gear up their supply chain. That may or may not have anything to do with our ability to, to sell our portion of the kit, because that has to, we've got to get the kits installed in the airplane first, and in the case of a large order, airlines are telling us, well, they don't, they don't really want to have, you know, a small group of these airplanes flying with the system installed. They don't want to start flying it until they have half the, half their pilots, all their pilots trained and half their aircraft equipped. From an Elbit point of view, that could take, you know, that could take a while to gear up their supply chain. With respect to a smaller group of, of airplanes in an airline, somebody that has 10, 20, 30, 40, even less than 100, you know, that could come relatively quickly on our part. We could satisfy that whole order. We have, we have ordered kits. We mentioned earlier that, that we ordered $33 million worth of kits from Elbit this year, which we expect to take delivery of if the, if the demand is there for this year. It's going to put pressure on Elbit to produce the kits, and, you know, we've been assured that they can meet the orders that we place with them, and all we got to do is get the orders. I don't know if that answers, that answers your question, but for a small order, we can start delivering this year. How many? 10, 20, 30. I think if you need to think in that order of magnitude. Thanks a lot. It's a very helpful color. I'll pass it along here. Okay, you're welcome. Ladies and gentlemen, as a reminder, if you would like to ask a question, please press star one on your telephone keypad. Our next question comes from Gautam Khanna with TD Cowen. Please go ahead. Yeah, I was wondering if the EBITDA cut this year, apples to apples, can we just add that to whatever the base level was going to be next year? Because of the timing of P2F conversions, i.e., it's just a pushout, and so we'll have a disproportionately soft 2023 and a disproportionately strong 2024, excluding AerAware. I think, as we noted, as we're looking at a soft freight market, we need to reevaluate whether we'll have the opportunity to sell those P2F as full asset, or if the most advantageous avenue will be to put those aircraft on lease. As you know, obviously, that has a different financial impact in the short term, overall. We're still evaluating that, so it's not a direct shift from one period to the other. What I can say, based on our value that we put out, we bought these assets are, even we put them on lease, they'll be lucrative. Lease is higher than the industry, 1% monthly lease rate factor. If we have to go down the lease path, that'll still be a profitable avenue for us, but it might generate a different result, in the fiscal year. Can you quantify the EBITDA of the monetization not happening this year, attributable to three aircraft? We haven't provided specific margin profiles on the overall assets. What I can say is, if you looking at the midpoint, the overall decrease, that is almost all attributable to the margins on those three overall assets, without getting into specifics on specific margins on those specific assets. Then, Martin, could you maybe characterize for us, based on maybe the last couple of years even, what the base level of EBITDA is in the business, ex aircraft sales and engine sales? I know it's part of the mix, but I'm just curious if we were to strip that out, what the underlying business does in terms of MRO and, and the like. I think as, as Nick has noted, that, that's challenging in that if you compare back to the period of COVID, obviously our component MROs, our USM business, pretty much anything that supported the, the, the kind of commercial or passenger side was off, and that was offset. In fact, we had a mix on being majority passenger-driven to cargo-driven, kind of overall. We were able to react and go where the demand was, which was in the passenger overall market. Now as we're seeing kind of a, a shift back into the, the passenger side is, has much stronger demand, we'll shift back into those overall items. It's, it's kind of hard to kind of note what a traditional item are, excluding whole assets, because, again, whole assets is just one way that we monetize our feedstock, and had we not done that, we would have monetized those assets through the USM or leasing channel. Last one for me. When you guys acquired the 757s, one of the advantages you had was they were parked at a facility you control. Do you have anything in the pipeline that might be, that's currently parked at one of your centers, that could be sold and that could also offer kind of this, hometown advantage, if you will, because you'll know the asset better than the competition and the like? I didn't know if anything was coming out of the desert that, that might be for sale, that's within your facilities in the Southwest. Not, not at the scale of the 757 transaction we did with American. That was a big chunky transaction. There are aircraft that are located in our facilities, both in Goodyear and Roswell, both places that we're aware of and that, you know, we're submitting bids on those aircraft in those locations. We are closing on aircraft that are located in our facility, and we have aircraft that are flying into our facility that ultimately will end up being sold as a part-out aircraft. You know, we'll kind of have a first good look, understanding of the condition of those aircraft as they get there. People are flying airplanes into our facility knowing that we're interested in buying them. They just like to know the fact that, well, at least I put it in their facility. If they're the best bidder, it's right there, it'll be easy for them to close. You know, I think that's an advantage that we have. Big chunky group of aircraft? Not yet. A bunch of individual ones, yes. I would add, I think our, definitely our advantage now is the ability to buy equipment that needs work. I think we've noted in the, in the Q1 call that the material that's coming out right now is not material that easily can be put back into service. Now our competitive advantage is truly using our multidimensional model, and that we can extract value much better than folks can on that type of equipment. That is truly being our competitive advantage in this point in the cycle. Appreciate it. Thank you, guys. You're welcome, Gautam. There are no further questions at this time. I would now like to turn the floor back over to Nicolas Finazzo, AerSale's CEO, for closing remarks. Please, sir, go ahead. Okay, well, thank you to everyone on the line for joining our call today and for your interest in AerSale. There are a few points that I feel should be reiterated. Our business is purpose-built and multidimensional, which enables us to drive growth and profitability across cycles, and even when certain parts of our business are under significant cyclical pressure. This isn't always apparent in our consolidated results, as our diversification and end-to-end solution allow us to shift quickly and efficiently into areas of strength. This was most pronounced as we navigated through the pandemic, as we were able to pivot early into the cargo market that had record demand, which drove record results through the second half of 2022, even as the commercial side of the business was significantly impaired by travel restrictions. These effects have unwound over the past 12 months. Our go-forward mix of business and growth drivers are substantially evolved as a result. Our prospects to add value to all stakeholders has never been stronger. Our commercial side of the business has demonstrated strong growth consistently as it recovers. We are entering the second half with record feedstock to support commercial demand. We have expanded our MRO capacity to enable further growth. We are working diligently on our M&A program to expand capacity and capability. The eventual certification of AerAware will further drive our results. These are the primary factors that give us confidence into the second half and into 2024. We look forward to keeping you guys updated on our progress. Thanks again. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.