Good afternoon, welcome to the Astronics Corporation first quarter fiscal year 2023 conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star one on your telephone keypad. To withdraw your question, please press star two. Please note, this event is being recorded. I would now like to turn the conference over to Debbie Pawlowski, Investor Relations for Astronics. Please go ahead. Thank you, Priscilla. Good afternoon, everyone. We certainly appreciate your time today and your interest in Astronics. On the call here with me are Peter Gundermann, our Chairman, President, and Chief Executive Officer, and Dave Burney, our Chief Financial Officer. You should have a copy of our first quarter 2023 financial results, which we just released after the market closed today. If you do not have the release, you can find it on our website at astronics.com. As you are aware, we may make some forward-looking statements during the formal discussion in the Q&A session of this conference call. These statements apply to future events that are subject to risks and uncertainties as well as other factors that can cause actual results to differ materially from what is stated here today. These risks and uncertainties and other factors are provided in the earnings release as well as with other documents filed with Securities and Exchange Commission. You can find those documents on our website or at sec.gov. During today's call, we will also discuss some non-GAAP financial measures. We believe these will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP measures with comparable measures in the tables that accompany today's release. With that, let me turn it over to Peter to begin. Peter? Thank you, Debbie, good afternoon, everybody. Thank you for tuning in for our call. In general, we feel the first quarter was a reasonably good start to the year and we're making lots of good progress, though there are challenges. We'll divide this conversation generally into a discussion of the positive points to begin with, and then focus a little bit on the challenges towards the end. Sales were up 35% year-over-year to $156 million. That exceeded the range that we predicted when we last talked. Aero was up 34%, that's aerospace, to $135 million. Our test business was up 42% to $20.9 million, but that includes a $5.8 million non-operating adder, which we will discuss in some detail a little bit later. Jumping to the bottom line, we had a net loss of $4.4 million and an adjusted EBITDA of $6.1 million, which was 3.9% of sales. That's a nice improvement from where we were one year ago when we had adjusted EBITDA of $1 million, and even an improvement over the fourth quarter when adjusted EBITDA was $4 million on higher sales. Evaluating the quarter and comparing it to last year's first quarter is somewhat complicated due to several factors, including this non-operating revenue of $5.8 million in our test segment, an equity investment payable write-off of $1.8 million, earn-out income on our semiconductor test sale from a few years ago of $3.4 million in the current quarter versus $11.3 million in the comparator quarter a year ago. AMJP, Aerospace Aircraft Manufacturing Jobs Protection Act grant receipts of $6 million in the comparator quarter a year ago. Dave will dive into some of those specific items when he gets a turn at the mic in a few minutes. Demand remains pretty strong with bookings at $158 million, once again setting a new record backlog at the end of the quarter. Aerospace orders, in particular, were strong at $150 million, which is a book-to-bill of 1.11. Test was light by comparison at $7.8 million in bookings for the quarter. Test orders tend to be lumpy and vary quite a bit from quarter-to-quarter, so we don't get too worked up about one quarter being light in that business. In terms of new business, two significant developments occurred shortly after quarter end that are worth mentioning. On April 6th, the Government Accountability Office, the GAO, dismissed the Lockheed Martin protest on the Army's FLRAA program, clearing the way for Textron's Bell to proceed. We're not allowed to say too much about that program at this point, but we expect to be turned on with development work in the coming few weeks. As we have discussed on these calls in the past, this program promises or has the potential to be one of the most significant programs in our company's history before it's done. Also, in April, we were awarded the Handheld Radio Test Sets program by the Marine Corps, otherwise known as HHRTS. This is an award that we expected to come out almost a year ago, but we're happy to get it later than never. It's a radio test program for the Marines, an IDIQ, which stands for Indefinite Delivery, Indefinite Quantity, which we expect will be worth approximately $40 million in revenues over a five-year period. We expect it to be front-loaded in the first three years, mostly. We expect a first major task order potentially of about $10 million in shipments in coming weeks. This is a complement to the TS-4549/T program we talked about before. That's a radio test program for the U.S. Army that we won last fall that is in contract negotiation. As an aside, HHRTS is the final major new program pursuit that we had in our sights when the pandemic began in early 2020. We made a conscious decision to maintain certain resources and pursuits, even though we knew that our business was gonna struggle as the pandemic took its hold on the aerospace industry. At this point, I can say we've been stunningly successful, actually, winning pretty much every item on the list except for a couple that are on indefinite hold, which includes, in addition to FLRAA and HHRTS, TS-4549/T that I just discussed, a new generation in-seat power architecture, which was instrumental in winning Southwest Airlines as a customer and has subsequently been successful with narrow-body operators all around the world, an antenna kit program for Safran and Airbus, establishing ourselves in the emerging electric and eVTOL aircraft market, and a few other programs that we are not yet allowed to discuss. These programs, as a group, are barely represented in our backlog and have not yet meaningfully affected our results, but they will begin to do so as 2023 rolls along. Looking forward, we are holding our 2023 revenue forecast at $640 million-$680 million and establishing second quarter guidance at $165 million-$175 million. At the midpoint, this implies second quarter growth of 32% year-over-year and 9% sequentially. For most of the pandemic, we have vacillated between $100 million-$125 million in quarterly revenue. The last two quarters have been in $155 million-$160 million. Now we feel we are stepping up to $170 million, $175 million or slightly more for the rest of 2023. At that level, we would expect for the rest of the year to be strongly cash positive and profitable. Some discussion on margins. We are reasonably comfortable with how our aerospace segment is progressing. As volume increases, the margin profile will continue to improve, especially since the growth is largely in commercial aerospace, a market that has traditionally been quite lucrative for us. We are making margin progress in our test business also, but first quarter results make it less obvious. We restructured the business in mid-April and took out about $4 million-$5 million of annual cost, with savings being evident in the third quarter this year after severance costs are finished. This action was necessary due to delays with some of the new programs we have won, particularly in the area of the radio test HHRTS and TS-4549/T programs discussed recently, but also with some transit and test work that we are progressing on slowly due to customer delays. We expect these new programs eventually to contribute $20 million-$40 million of annual revenue, which will be a significant adder to the current business level of about $80 million per year. They've been slow to take off, and they are not here yet. To bridge the gap, we felt it necessary to cut some costs. This action will allow the business to establish profitability at current revenue levels of $80 million-$85 million per year while waiting for the new programs to launch. The test business has been a challenge. Another of our challenges is working capital. The sales ramp we are experiencing is a good thing, but it has led to higher receivable balances, and ongoing supply chain snags have resulted in increased levels of stranded inventory. This was especially apparent in the first quarter. Receivables remain high, will remain high in the near term as revenue continues to ramp, but we believe we are at the high point on inventory and expect to see a gradual decline from here. At this point, I'll turn it over to Dave to go into some details of some of the topics I brought up. Dave? Thanks, Pete. As Pete mentioned, there are several unusual income and expense items to point out in the quarter. One in the comparable 2022 first quarter. For reference, you can see these items called out on, I think it's page eight of the, of the release in the, in the table that reconciles adjusted EBITDA to GAAP net loss. First and most significant of which was a $5.8 million increase to sales that was a result of reversing an opening balance sheet contract liability that was created in one of our acquisitions a few years back. The short explanation is that we bought a test company and assumed a $5.8 million deferred revenue liability related to a customer contract, which is no longer expected to occur. Second item I'd like to point out is a reversal of another liability of $1.8 million that was recorded as in other income this quarter, and it was related to an equity investment in another company that we no longer are required to make. It was a startup company that failed to meet certain milestones. Third item, we recorded a final earnout payment of $3.4 million from the sale of our semiconductor test product line a few years ago. In last year's first quarter, we recognized $11.3 million for the earnout, and as compared to $3.4 million this year. It was the final earnout for that sale of that business from several years ago. Fourth item is our legal costs defending our positions in the IP-related suits was high in the quarter at $4.4 million, about $3.2 million higher than last year's first quarter. Last, I'd like to point out that in last year's first quarter, we recognized $6 million from the AMJP grant program that Pete mentioned. It's a reduction in cost of sales for that period, and there have been no comparable grants available since then. Considering all these puts and takes, our adjusted EBITDA improved from $949,000 in 2022 to first quarter to $6.1 million this quarter on a $34 million increase of sales, excluding the adjustments for the $5.8 million of non-operating sales that I previously referred to. I'd like to add that adjusted EBITDA also improved when compared to the preceding fourth quarter of 2022. Looking at segments, our aerospace business continues to see a strong recovery and is ramping to satisfy customer demand. Aerospace sales were $135.6 million, up $34.2 million or 33.7% from last year. Bookings were strong at $150 million. We expect aerospace sales to ramp to $150 million-$160 million in each of the final three quarters of the year, which will see the segment return to solid profitability. We're still expecting to incur some spot buy expense in the second quarter, which will impact margins in that period. Aerospace operating margin was $4.1 million or 3%, an improvement of $7 million compared to the 2022 first quarter when you exclude the impact of the $6 million AMJP grant from last year. Our test business, on the other hand, had a mixed quarter. The top line of $20.9 million looks all right, it includes $5.8 million of non-operating adjustment we've discussed above and mentioned by Pete. If one backs out the net adjustment, the test results were not so good. We expected sales to pick back up to $20 million in the second quarter and they'll stay there for the rest of the year. Shortly after the quarter closed, we had a restructuring. Pete went through that a little bit, where we're expected to benefit $4 million-$5 million annually from that restructuring. They'll start to show up in the third quarter. The restructuring again was necessary due to the slow takeoff of some of the higher dollar programs for the test segment. Turning to debt and the balance sheet. Cash flow continues to be a challenge due to inventory growth. Cash flow from operations was - $19 million, due primarily to inventory growth, which increased by $13.9 million, and receivable growth, which increased by $4.2 million during the quarter. While the supply chain is improving, part shortages and last-minute reschedules from suppliers are hampering our efforts to reduce inventory levels and improve inventory turnover. Receivable growth was mostly due to the timing of shipments weighted toward the last month of the quarter, where roughly 50% of our shipments occurred in the month of March. We're compliant with our debt covenants and are forecasting continued compliance and positive cash flow for the balance of the year. Pete mentioned, maintaining revenue guidance of $640 million-$680 million for the year. That's all I have, Pete. Okay. I think that almost concludes our prepared remarks. With everything being said, we feel that the first quarter was a reasonable start to the year. There are challenges, there always are, but we think the rest of 2023 is setting up to be a pretty exciting time for our company. We will open it up at this point for questions, Priscilla. Thank you. We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your headset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Priscilla, is Jon there? Our first question comes from Jon Tanwanteng with CJS Securities. Hi, can you hear me? Yes. Hi, Jon. Hey, Pete. Thanks for taking my questions. My first one is, just wondering how much you left on the table in terms of sales because of the inventory that was stranded, whether it was component shortages or timing of other stuff that was going on. Probably about $25 million. We got about $25 million of orders that are scheduled or overdue, past due at this point, and most of that is due to part shortages. Okay. Are you seeing relief? You didn't ask a complete question, but I'll. Yeah. Are you seeing relief in Q4? We're seeing continued, I'd say, continued progress on our supply chain in general. We've been saying that now for probably about five or six months, and it continues to get better. It's still not perfect. You end up with these situations, and it... and, you know, you never know what it's gonna be, from period to period or week to week or month to month. In general, $25 million is the number that we think is past due. Now, I should distinguish a little bit because, you know, we have this huge backlog, and customers would happily take stuff, faster and sooner if we could accelerate and do it. As our supply chain improves, sometimes it improves in fits and starts. To give you some color on that, you know, we're putting guidance out there for the second quarter of $165 million-$175 million. We've got scheduled orders well in excess of the high end of the range there. We're taking into account our current performance level of our supply chain, and we're not assuming significant improvements in the short term. I might point out that, for each of the last two quarters, we've actually exceeded the high end or hit the high end of our range. It's starting to come back, and it's starting to come back, we think a little bit faster, which is a good thing in general for the world and for our industry. It also caught us a little bit by surprise with inventory growth in the first quarter. There's a flip side to it that's not so positive. Got it. That's helpful. Just thinking about the run rates that you were forecasting for the rest of the year, you know, $150 million-$160 million on the aerospace side and $20 million on the test side, that gets you to the high end of your range already. I'm wondering if that's kind of what you're pointing at in your guidance with those expectations. Second, what's the profitability you're expecting at that run rate? You know, the $160 million-$170 million. Did you say profitability or possibility? Profitability? I thought probability. Sorry, Jon. We have a weird setup in this room that we're in. It's not totally easy to hear what you're saying. Did you say what's the probability of hitting the high end of our range? I said, what's the profit at that range? The profitability. Okay. That's what I thought. We don't do down, you know, bottom line guidance, as you know. We would expect, as we get to that range, and you're right, the kind of the numbers we're forecasting put us at the high end of our stated range, we would expect to be, you know, positive cash flow and, you know, reasonably profitable, in the second half of this year in particular. As far as the range goes, we're sticking with $640 million-$680 million, as I said. The supply chain and all the unpredictabilities of the world certainly mean that there is some risk of downside potential there. There's also opportunity for upside potential, in my opinion, as the supply chain continues to improve. We certainly have the business, and we have the orders. The customers will generally take product if we can deliver it earlier than what we're currently agreeing to. I think the second half is gonna be an exciting time for the company, and, you know, it'll begin to feel and look a lot more like it did kinda pre-pandemic than it has since. Okay. Yeah, I think, Jon, one of the- Oh. One of the things as a general rule of thumb is to think about is our contribution margin on incremental sales is gonna be, you know, close to 40%, 35%-40%. We have some spot buys that are continuing to happen, but they're much smaller than. I think last year, some quarters we had $3 million of costs relating to spot buys. First quarter this year, it was somewhere around, rounded to $1 million or so. Those will drop off as we move into the second half of the year. The contribution margins should improve to, you know, we were down in the 30%-35% last year. I think we're progressing up, moving toward that 40% contribution margin on the incremental sales. Okay, great. Last one from me. Just within that $20 million run rate for the test business for the rest of the year, does that assume any pickup from these, the Army or from Marine contracts that you landed, or is that expecting, you know, more, more of a ramp in 2024? They're gonna significantly ramp in 2024. We do have some lower-level assumptions in 2023, but they're for test units and low-rate initial production units, things like that. You know, we don't have this HHRTS task order yet. We expect it shortly, but it'll probably become more of an early 2024 issue than a 2023. TS-4549/T, on the other hand, we are, at this point, expecting formal contract award sometime in the August-September timeframe, and there will be some positive impact at that point in terms of low-rate initial production units and some engineering expense that will get relieved once the contract is signed. That also will significantly begin to ramp more in 2024 than in 2023. Understood. Thank you. I'll jump back in queue. Okay. Our next question comes from Pete Osterland with Truist Securities. Hey, good evening. I'm on for Mike Ciarmoli this evening. Thanks for taking our questions. First, just wanted to ask on the aerospace segment. Looking back historically at the revenue run rate you delivered this quarter, you've been able to generate segment operating margins that were more in the low teens. I was just kind of wondering how to kind of think about the difference. Like, how much of an impact to margins would you estimate that the spot buys had in the first quarter? You know, kind of where are the other biggest margin headwinds that you're seeing versus what your cost structure looked like pre-pandemic? You know, just trying to get at if there's any other potential drivers for margin expansion throughout the rest of the year aside from the volume impact you called out. All of the spot buy was in the aerospace segment, so that was roughly $1 million. You know, the top line growth is what's gonna drive the operating margin for the segment as we move through the year. I would answer by saying that, I don't know how far back you had to go to look at that similar kind of revenue run rate for our aerospace business. Today we're a [audio distortion] and deep company, and frankly, we didn't really have a chance at back in those days. I mean, the system that we're putting on FLRAA, just as an example, on Bell's V-280 Valor, is something that I think most of the industry didn't think even today we were capable of. Bell knew because we've been working with them on their previous two commercial helicopter projects, they knew what we could do. a FLRAA type of program is not something we could have done, say, five or six years ago. We do have more of an overhead element to our business. I think it's a very capable element, and I think it's one that's gonna drive results. You know, they take time to mature, and FLRAA will not be an exception to that. It'll take time. Those kind of programs can be incredibly valuable over a long horizon period. That's very helpful. Thank you. Then, just as a follow-up, I wanted to ask a question on the labor front. Are you fully staffed to the degree that you need to be in order to meet your full year revenue guidance? Have you seen any recent changes over the last few months, either with attrition or just overall labor availability? We have certain hotspots in our company where we do have labor challenges. In general, and even in those hotspots, I would say that labor is getting to be an easier issue. It's freeing up a little bit. We, like most companies, had a lot of churn over the last couple years. We're starting to see some of those people come back even now. You know, it turns out the grass isn't always greener on the other side. We're also having an easier time just attracting people in general across most parts of our business. If all the parts came in right now, would we have all the people we need? Probably not. The big challenge for us is not people, it's much more parts. Very helpful. Thank you for taking the question. Sure thing. Our next question comes from Tony Bancroft with Gabelli Funds. Hey, gents. Thanks so much for taking my question, and congratulations on the good quarter. Maybe you could remind us again, what the FLRAA program entails, you know, potential full rate, ship set. Then is there a potential to get more content on that program? Well, as you know, Tony, these programs can have a long and somewhat unpredictable trail. Right. Our piece of it at this point isn't even firmly defined yet. It's still a little bit in flux. I think I used this line before, and I'll use it again, even though we're, you know, we're not under contract yet, and this isn't formalized. As our company's grown over the years, our ship set content has grown also. I use the example of there was a time when the business was based on, you know, maybe $10,000 per business jet, and we were largely a business jet company. Today, if you were to take a wide-body aircraft and put absolutely everything on it that we could possibly put on it from a lighting perspective, from a safety perspective, from a in-seat power perspective, from antennas and file servers and wireless access points, all the things that we do, you'd probably come up with. By the way, there's never been an airplane like this. We've never had one. If we had one, it would be somewhere in the neighborhood of probably a $750,000 ship set, something like that. Our FLRAA ship set content as it exists right now is well north of that. It's a major program and, you know, it's, as you know, largely designed to replace Black Hawk or to complement the Black Hawk. Nobody's saying they're gonna be a one-for-one replacement, but there are 4,000 Black Hawks out there, and many of them have been out there since the mid-1970s. They're due for a major upgrade. I think the working number that I come across most is somewhere in the neighborhood of 2,000 ships, before you start selling internationally. Right. It's a significant program. Yeah. Yeah. That's great. Again, could you remind me? The second program is obviously the FARA program, obviously is not as, it's much, you know, it's not, doesn't have the same kind of volume as FLRAA. Just because your relationship with Bell and just, well, what you guys do, is there any potential to be on that program as well? Is that a possibility? If so, like, maybe what do you think? Yeah. With Bell, certainly. We are on their FARA entry also. Great. Wonderful. I guess with such a long, you know, such a transformational, this contract is, you know, and potentially so transformational, maybe longer term view, where do you see your company, you know, five years from now when this program matures? Is it make sense to do something transformational with, you know, with Astronics or how do you see that? I mean, it's such a, you know, this has just really changed your, I think it's probably gonna change your business quite a bit. I just wanna get your thoughts on that. Well, to tell you the truth, we've been thinking so much about quarter to quarter through this pandemic. We haven't... Fair enough. ... you know, the program delays and then the challenges legally and all that stuff. Yeah, I think it opens up a ton of opportunity for our company. You know, we were challenged in this pandemic largely because when we went into it, we were 70% commercial transport. Yeah. That's the area that got kicked in the teeth the most by the pandemic. We were only 10% military aircraft. If you run those numbers that we were talking about just moments ago, you know, that program single-handedly has the probability or potential to rebalance our business, I think, in very favorable ways from a market diversification standpoint. So, we're certainly looking forward to that. That will be transformational in and of itself from my perspective. Beyond that, you know, we haven't put any stakes in the ground as to what we want to accomplish or even where we would plan to build those products. We're gonna design them in our facilities where we have that expertise, but it's gonna take a lot of floor space and a lot of capital to get that program going. Luckily, we have a few years to get that effort underway. Yeah. That's a really good point. Maybe just one more. You know, you sort of talked about how this is, you know, likely gonna shift the, you know, business, giving the split more, you know, more balance in defense. You know, sort of a, another, you know, the second benefit, of course, is the back to the commercial side. You have all these, you know, aircraft that are still being flown longer than extending out times. You've heard all the other conference calls and discussions about this. I mean, it seems like on the sort of aftermarket piece, there's this, you know, this probably huge wave of opportunity for these extensions and then just, you know, retrofits. Maybe could you just sort of update us on what... how you're seeing that, and how that's sort of transformed over, you know, throughout the pandemic and up to this point? I think it's a good point. It is a growing part of our business. You know, our business has grown quite a bit over the years. In many respects, we're still a pretty young company. I'm gonna date myself here a little bit. You know, I remember a time when we were about four and a half million dollars in sales. We hit $800 million right before the pandemic hit. A lot of that growth came over the last 10 years or so, 10, 12, 13 years. A lot of the products that drove that growth are maturing and needing to be replaced. We definitely are seeing an uptick in some of the spares purchases and some of the repairs purchases. That's never been a big part of our business, but as we get larger and as these products, you know, everything on an airplane breaks, again, as you know. I think, you know, being a pilot is a much easier job if airplanes never broke, right? They do. There's certainly a market there. I expect that will become a bigger part of our business. In certain places, it's starting to now. But it's not a major thing yet for us. It's not something we break out separately in our financials, but I can see us getting to that point someday. Got it. Thanks. Great job, Pete or Dave. Well done. Yeah, thanks. Our next question comes from Scott Lewis with Lewis Capital Management. Hey, good afternoon, guys. Hi, Scott. Hi, Pete. Hey, one question on FLRAA. What kind of margins will the development work entail? Well, we anticipate being fully funded for sure, and we anticipate having a reasonable return on it, a risk-reduced return. That contract is in negotiation, so it's a little hard to talk about it at this point. I expect that we're gonna be turned on before our next conference call, so I should be able to talk about it a little bit more by then. I can also say that the scope of activities over the next, say, 15 months has bounced around quite a bit. We don't really know exactly what we're gonna be asked to do yet, at least I don't. Some people in our company may know. It's a little hard to say. We expect to be turned on, and we expect to be, you know, shuffling some of our people around and adding to our staff to do it. We're not gonna make additions, and we're not gonna do too much of that shuffling until we finally get under contract. Okay, got it. The second question is, you know, looks like in 2024 you'll be pushing a, you know, good volume through your main kind of business units. How about your smaller business units, you know, some of those that gave the company some troubles right before the pandemic? Anything there that is concerning that could detract from the, you know, overall performance of the company? No, not really. You have a long memory, Scott. I do. Also remember that those three, I think we call them problem children, at the end of 2019. Yeah. We took some pretty major restructuring steps to fix them. Those steps have largely, I feel, been successful. We haven't talked about them a whole lot since. They're in general doing pretty well. One of them, in fact, is probably one of the most profitable parts of our business right now, right? You know? It's profitable. Which is a big change. Yeah, we're not gonna go back to those days. I think we got those things fixed. Okay, good. That is good to hear. As far as long memory, I remember the big last really big military contract, the F-16 night vision cockpits. Oh, boy. God. Oh, boy, Scott. Really? Yeah, that's. Yeah, I remember that. That was way back in. Started in the late 90s. Yeah. Like 1998 or- It was earlier than that. It was, it was the reason we built this building. My recollection at that time was that was just when we were. We had two operations. It was just New Hampshire and New York. We were a $16 million program, and the program Scott's referring to, for those who don't know, it was a Air National Guard-led program to retrofit the Guard fleet of F-16 fighters for night vision goggle compatibility. Everything that lit up on the airplane, interior, cockpit, and exterior, had to be replaced. We were about a $16 million company. I think that was a $50 million contract before you started doing spares and all that. The Air Force jumped in on it too. It turned out to be 1,156 airplanes- That's right. for what it's worth. Although four of them got crashed. Four of them crashed. Four of them crashed before we got done, it was really 1,152 airplanes. Okay. [crosstalk]. Yeah. FLRAA does as many and maybe more. Yeah. That'd be nice. All right. Thanks, guys. Thank you. Our next question comes from Jon Tanwanteng with CJS Securities. Hey, guys. Just wanted to go back to the margin question. Do you still expect to be back at those low-teen operating margins in the aerospace business, you know, sometime in the next maybe five, six, seven quarters or so? I think It might take a little bit longer than the next, you know, four o rfive quarters to get back to the to those to the low teens in terms of operating margins. Yeah, I think our expectation is to get up to the mid-teens in terms of EBITDA margins as the top line grows when we get, you know, probably post this year, maybe into the beginning of next year. I can see us getting into the teens in terms of operating income on the aerospace segment. Probably not within the next year, though, but definitely as the top line grows. What we'll also see is new contract pricing start to kick in more than it is right now. We're really not seeing a whole lot of it. We've quoted a lot with new pricing in it, those are typically year, two, three -year programs that will begin as we move through this year and into next year. The new pricing is reflecting the inflation that we saw in the past 12 months here. It's, we're gonna see some margin expansion related to that versus what we're seeing right now too. Got it. That's helpful. Just, a quick question on the legal costs. What are you expecting for the rest of the year and kind of when do you expect that to finish up? That's a hard one to predict. Probably it may not be consistent from quarter to quarter, but probably in the $2 million-$4 million a quarter range, I would say. You know, it might be $4 million one quarter, $1 million the next. It's depending on what's going on in the process for each of the suits. Okay. Just remind us how much room you have under your covenants at this point in case, you know, you have more problems with receivables and inventory or something else is going on? Yeah. The, let me see where we are right now. In terms of the minimum EBITDA compliance, we have around $9 million of room, on the minimum EBITDA compliance. Okay. That's our primary. Great. Thank you. That's our financial covenant right now.