And welcome to the Astronics Corporation. Second Quarter Fiscal year 2026 Financial Results Conference call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As. A reminder this conference is being recorded. It is now my pleasure to introduce Deborah Pawlowski Investor Relations for. Please go ahead. Thanks, Joe, and good afternoon everyone. We certainly appreciate your time today and your interest in Astronics. On the call with me, here are Peter Gundermann, our chairman, president and CEO, and Nancy Hedges, our chief Financial Officer. You should have a copy of our second quarter 2020 financial results, which crossed the wires 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 likely aware, we may make some forward looking statements during the formal discussion and 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 could 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 the Securities and Exchange Commission. You can find those documents on our website as well as at sec.gov. During today's call, we will have some non-GAAP measures that we'll discuss, which we believe will be useful in evaluating our performance. You should not consider the presentation of this additional information. Isolation or as a substitute for GAAP results. We have provided reconciliations of non-GAAP measures with comparable GAAP measures in the tables that accompany today's release, so with that, I will turn it over to Pete to begin. Thanks, Debbie. And hello, everybody, and welcome to the call We're here to talk about our second quarter results and our outlook for the remainder of 2026. Nancy and I will do our usual back and forth and then open up the lines for questions. In. Summary. The second quarter was very strong for Astronics. We set records all over the place for revenue for operating profit, for bookings for backlog, and more Our adjusted EBITDA was just shy of 20% of sales, which is a modern day high. It was a very good quarter from every angle, and we feel good about it. It also puts us in a great position as we enter the second half of the year. We have strong momentum in are raising our revenue guidance to 1.02 to $1.04 billion. We'll talk more about this at the end of our presentation, but we are excited to finally be crossing the billion dollar threshold. Nancy will. Walk through Q2 numbers in due course. But first, I want to focus a little on margins. We've been. On our margin profile heavily, and we have made significant progress. Our adjusted EBITDA margin, for example, was in the low to mid teens, just one year ago. In the first half of 2025. And practically all of 2024, for that matter. And now we are pushing 20%. There are a number of levers that we have used to accomplish. This, and I'll discuss them one by one. The first lever, and arguably the most important, is the strong market demand that we see for our products, as evidenced by the bookings trends we have been experiencing a few. Years ago, at the height of the pandemic, we averaged bookings of a 100 million to 150 million per quarter. Since then, our bookings level has risen, risen steadily, culminating in our Q2 bookings of 306 million, which is an all time high indeed. Over the last four quarters, our sequential booking totals have been in order 210 million 257,000,290 million, and now 306 million. Things can be lumpy, of course, and we can't count on that type of progression indefinitely. But the overall trend is prominent and unmistakable. In our first quarter call, I discussed a range of factors driving our bookings. I'm not going to go into a lot of detail here to repeat all that, but to recap, they were first increasing aircraft production rates. Second, airline passengers desire to be entertained and connected at all times. Third, the growth of our flight critical power franchise for smaller and emerging aircraft. Fourth. The trend towards high end aircraft seating that uses our seat motion systems and fifth, the expected growth in our test business based on the US Army Radio test program that we have been talking about for some time. Interested listeners who want to review that discussion should check out the transcript that's available on our website. Higher bookings, of course, leads to higher shipments and higher shipments. Leads to better overhead absorption and increased profitability. I have said many times in recent years that we were not sized to be profitable at the reduced revenue levels we saw during the pandemic. Now we are growing into our cost structure and our income statement is responding well. In the second quarter, there were a couple of bookings that deserved special mention. The first was a $27 million booking for Flera MD 75 development work, which is a follow on to a $57 million order. We received back in 2025. We expect another relatively small order in early 2027, which should carry us to completion of the engineering development phase of the program. The MV 75 is the US Army's planned replacement for the Blackhawk helicopter and promises to be the largest military program. Our company has ever seen. I don't intend to go into more details on it now, but I recommend that interested listeners who are unfamiliar do some research and look that one up. The MV 75 will be a big deal in our future. The other significant booking in the quarter was the long awaited production go ahead for our radio test program with the US Army. Called 4540. Nine T. The order was for 45 million and will cover deliveries over the next 18 months. We expect similar orders annually for the next 4 to 5 years under an ID, IQ award. We received back in 2020 for. The production award was not a significant factor to our Q two. Results, but will begin to be so as production ramps up in the second half of this year, when it is in full swing, we expect margins in our test business to be comparable with what we get from our aerospace segment today. The second margin lever we have been using is pricing. About one third of our volume involves deliveries that are tied to long term contracts. Typically with terms of 3 to 5 years. On these contracts, our pricing suffered when inflation picked up during the pandemic. Inflation has since cooled down generally, and we have been able to reprice most of the affected long term contracts, which has certainly benefited our overall profitability. We estimate that we are still waiting to reprice about one quarter of our long term contracts, which will come due over the next 12 to 18 months. The majority of our business is shorter term in nature, and we have learned to price to value more than to cost, which is also driven, increased profitability. We believe that the cumulative effect of pricing actions has been and will continue to be an important aspect of our margin improvement journey. The third lever for discussion is organizational efficiency. And the point here is that we have suffered very high employee turnover during the pandemic. At times approaching 20% in a year. High turnover meant that we had a workforce that was relatively inexperienced in their jobs, and that, in turn, hurt our efficiency and our quality. Today, our employee turnover rate has dropped to about half of what it was. And in many of our locations, it's well below 10%. As our workforce has become more stable, it has also become more effective and competent. I'm describing the well-known learning curve. Principle, and while it is hard to measure, we certainly see our workforce becoming more efficient and predictable, which helps deliver better margins. The final lever with respect to margins that I want to discuss is structural to our organization, which some might call simplification or portfolio shaping, which we have done a fair amount of in recent years as evidence, we have shut down and consolidated seven production sites in recent years, and discontinued or limited a number of production product lines. Or and or businesses. This activity helps us stay focused on the product lines and customers that matter to us the most. And there's more to do on this front as our business accelerates and we continue to evaluate our market goals and competitive positioning, we will work to make sure our organization is structured appropriately to align with those goals. So those are the four levers that are driving our improving margins. Volume, pricing, efficiency, and simplification. But what's exciting is that each of these levers has room to run. In other words, the actions we have taken continue to be active, and we expect will lead to further margin improvement in the coming periods. So we are not at the end of our margin journey at all. But methodically moving along the process. Finally, before I turn it over to Nancy, there are a couple of other topics from our second quarter worthy of discussion. The first is the B share distribution that we did during the quarter announced on June 1st and executed on June 29th. It was a 20% distribution of B shares to all shareholders of record and was intended to reward shareholders, shareholders and encourage long term interest in the company. B shares have been an important part of our capital structure since the early 1980s, and because they don't trade but are convertible to common at any time, the share count drops over time as investors transition their holdings. The recent distribution was to replenish and rebalance the share count to historical norms. We have done approximately 20 share distributions over the years, about half of which have involved B shares. The. Final issue on my list is the decision by the UK Court of Appeals. In our long running patent dispute with Lufthansa Technik. This is a dispute that has been winding its way, or maybe I should say grinding its way through the courts in the US. UK, France and Germany. Since 2010. We won in. The US and the matter. There is closed and final. The. UK was the second jurisdiction to hear the case and we feel good about where that is headed. The damages case heard in late 2025 went our way and this most recent ruling altered the original ruling for the better. A final appeal to the UK Supreme Court is possible if the court agrees to hear it. Which at this point is uncertain. There will be an appeal in France in October of a lower court's ruling invalidating the subject patent. While Germany waits in the background. So the battle continues. But it is exciting to think that with a little luck, we may have line of sight to conclusion of the matter in the US. The UK. If there's no appeal to the Supreme Court and France, if the lower court's nullification of the patent is upheld. All this could happen by the end of the year. With all that being said, I'll turn it over. Nancy now to review second quarter accounting results. Nancy. Thanks, Pete, and good afternoon, everyone. I'll walk. Through our second quarter results in more detail. Provide color on our product lines and segments. Review cash flow and the balance sheet, and then close with our outlook as. Pete noted, the second quarter was an important proving ground for the profitability of our operating model and the organization delivered. Sales reached a record $260 million, up 27% from the prior year period. Higher volume, improving productivity and continued execution across the organization drove significant margin expansion, record operating income and adjusted EBITDA margin of 19.8%. We also delivered record bookings and backlog, providing strong visibility as we move through the balance of the year. Gross. Profit increased to $86.9 million, or 33.4% of sales, compared with 52.8 million, or 25.8% of sales in the prior year period. The 760 basis point expansion reflects higher volume, improved productivity and a $2 million Iipa tariff refund recognized during the quarter. The. Refund contributed about 70 basis points of margin and somewhat offset what we now view as an ongoing tariff run rate. At current volumes of about 3 to $4 million per quarter prior to any mitigation. Also, for context, the prior year quarter was adversely impacted by a $5.8 million charge associated with aerospace simplification initiatives and a $6.9 million impact from unfavorable revisions to estimated costs to complete certain long term mass transit contracts in our test system segment. Our. And D expense was $10.9 million, down modestly from $11.6 million in the prior year quarter. We continue to expect R&D to run roughly about 10 to $12 million per quarter. However, it can fluctuate based on project and customer activity. As and expense was $35.6 million, down about $900,000 year over year, and declined to 13.7% of sales from 17.8%. Lower. Related expense was largely offset by higher wages and benefits, higher incentive compensation costs associated with improved profitability and incremental expenses related to BMA, which we acquired last October. Income from operations was a record $40.5 million, or 15.6% of sales. Given the. Factors affecting last year's quarter, the comparison on a GAAP basis isn't truly meaningful. Looking. Sequentially, though, operating income increased $13.2 million over our first quarter this year, driven by the $29 million increase in revenue. I'll note, though, that the second quarter did have the benefit of the $2 million tariff refund. On an adjusted basis, operating income was $43.2 million and adjusted operating margin was 16.6%, which compares with 8.9% in the prior year period. And approximately $800,000, or 24.7% decline in interest expense, reflects the lower interest rates. Following our September 2025 refinancing activities. Tax expense was $2.8 million in the quarter, reflecting the benefit of a partial reversal of our valuation allowance as well as the expected expensing of R&D costs that are not. That's now permitted under the new tax law. Based on our current outlook, we expect to release the portion of our valuation allowance associated with deferred tax assets that are expected to be realized from our 2026 income. The benefit of that release will continue to be reflected in normal course during the second half of 2026 as we move. Through the third and fourth quarters, we'll also continue to evaluate the potential for an additional valuation allowance release of approximately 40 to $50 million. Any such release would be recognized in the period when we have objectively verifiable evidence of sufficient sufficient future taxable income beyond 2026 to support realization of those deferred tax assets. Our strong performance in the quarter dropped through to the bottom line, with net income of $35.1 million, or $0.75 per diluted share, and a. Net income of $32.6 million, or approximately $0.70 per diluted share. The weighted average share counts for all periods reflect the 20% class B stock distribution that was done in June. Adjusted. EBITDA was $51.5 million, more than double the $25.4 million reported in the prior year quarter, and up 36%, or $13.6 million, over the trailing first quarter adjusted. EBITDA margin also expanded 340 basis points compared with the first quarter to 19.8% of sales. This performance reflects the operating leverage in our model as volume grows, along with the ongoing benefits of our productivity and simplification efforts. Turning. To aerospace segment sales were a record $237.3 million, an increase of $43.7 million, or 22.6%, from the prior year period. We had growth across all our markets, which include commercial transport, military, air. Craft and general aviation. I'll review our major product lines starting with our largest product category, in-flight entertainment and connectivity, which had sales growth of 19% to $126 million. Growth was driven by continued demand for our connectivity and passenger power products, including strength in our commercial transport and VIP applications. And. Safety sales increased 5.5% to $59.2 million. This product line continued to grow on solid underlying demand from improving aircraft build rates. Flight critical electrical power sales increased 49.4% to $23.7 million, reflecting stronger demand for airframe power products, particularly in the military aircraft market. With the. Finalization of the engineering contract for the MV 75 Flare program, we're expecting to achieve approximately $35 million in revenue on that program in 2026. Seat motion sales increased 12 million to $22.2 million. The increase reflects strong market demand, as well as the $5.9 million contribution from the BMA acquisition. Aerospace. Operating profit was $48.3 million, or 20.3% of sales measurably improved over $18 million, or 9.3% of sales, in the prior year quarter, which, granted, did have a lot of noise. The improvement in profitability reflects leverage on higher volume, improving production efficiencies. The $2 million tariff refund, lower litigation related expense and the absence of current year simplification charges. The strong operating leverage inherent in the aerospace business is best analyzed sequentially. We're operating leverage excluding the tariff refund benefit was 47%. On an adjusted on an adjusted basis, aerospace operating profit was $50.7 million, and adjusted aerospace operating margin was 21.4%, an increase of 510 basis points from the prior year period. Aerospace bookings were $243.1 million for a book to bill ratio of 1.02. During the quarter, as Pete mentioned, the contract for the current engineering phase of the MV 75 flare program was finalized, resulting in a $27.4 million booking. Aerospace backlog ended with the quarter at a record $657.2 million. Turning to test systems, sales were $22.7 million, up 11.6 million from the prior year period. The comparison also reflects the $6.4 million reduction in the prior year revenue resulting from revisions to estimated cost to complete certain long term mass transit contracts. Segment operating. Profit was $600,000 compared with an operating loss last year. Current quarter profitability was impacted by approximately $4.1 million of zero margin revenue related primarily to raw material purchases for the U.S. Army and U.S. Marine Corps Radio test programs. Because those programs are revenue recognition over time, we recognize revenue as costs are incurred rather than upon shipment. Likewise, margin on that raw material related revenue will be recognized as production progresses through the remainder of 26. While. Ramping the program won't necessarily demonstrate the solid margin profile of the program, but should begin to be realized as we exit the year. As we exit the year. Test systems bookings were $63.1 million for a book to bill ratio of 2.78. That. Ended the $44.7 million order from the U.S. Army, initiating full rate production for the 4549 program, which is expected to support deliveries over the next 18 months. Test systems backlog ended the quarter at 123.3 million. Turning to cash flow in the balance sheet, we generated $30.1 million in cash from operations during the second quarter, reflecting higher cash earnings, partially offset by higher working capital requirements, including inventory. To support our expected growth. Capital expenditures were 5.7 million in the quarter and 16.9 million year to date. We continue to make the necessary catch up investments in the business, including the consolidation of operations and capacity improvements at our at our Seattle facility. We continue. To expect full year CapEx to be in the range of 40 to 45 million, with the Seattle consolidation, which is concluding here in the third quarter, we expect. To be free cash flow positive for the remainder of the year. Long term. Debt decreased by 24.1 million from year end to 310.3 million at the end of the quarter. Our. Capital priorities are internal investments and debt reduction at this time. Although acquisitions. If the right fit and price are not out of the question. We believe we have the financial flexibility with our available liquidity, which is 253.2 million at quarter end. We also continue to advance our global ERP implementation. Through the first half of the year. We incurred approximately $700,000 in incremental operating expense and capitalized approximately 4 million in costs related to the project. Visibility on our spending on the project is pretty straightforward. You can find the capitalized amount on the cash flow statement under cloud computing implementation costs, and we adjust out the external expenses from adjusted EBITDA. Turning to our outlook, I'll briefly summarize what we expect for our third quarter. We expect third quarter sales to be in the range of 265 to $275 million, which would represent another quarterly sales record. We expect fourth quarter revenue rate to improve modestly from there. Regarding margins, the second quarter demonstrated progress toward our high teens adjusted operating margins. We'll benefit at some point from the estimated 6 to $8 million of future Iipa tariff refunds. So timing of any receipts remains uncertain. Continued. Low volume leverage and the addition of the U.S. Army Radio Test Program should contribute, while mix can add some variability as well. We're pleased with the progress made during the first half of the year. Our focus remains on executing against the opportunities in front of us. Supporting growth while maintaining the discipline necessary to sustain strong profitability and cash generation. And with that, I'll turn it back to Pete for final comments. Thanks. Nancy. I'd just like to reiterate what Nancy said about the second half of 2026. We're pleased with our second quarter results and with the first half of that matter. And we are entering the second half of the year with lots of momentum. Our forecast has us crossing the billion dollar threshold for the first time, and we look forward to living on the other side of that line and. That ends our prepared remarks, Joe. We can open it up for questions. Now. Thank you sir. Ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad and 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. And. Our first question comes from the line of Greg Palm with Craig-hallum. Please proceed. Hey, this is Jackson Schrader on for Greg Palm. First off, congrats on the quarter. More impressive results. I just wanted to see if you could start out on, you know, what really surprised you in the quarter relative to when we were going into it. Would that be end end markets customers? I mean, whatever segments you want to say, but we're really just surprised in the quarter. I don't know if there were any real surprises. We went in with a certain forecast and actually what has become kind of routine is we beat our internal forecast. I think if I didn't do this in preparation for this call, but I think if we go back and look at like the last six quarters or so every quarter, we come in right at the top of the range or a little bit beyond it. So I. Wasn't very surprised by that at all, nor was I surprised by the two big bookings that we talked about. You know, we've been anticipating the radio test bookings for the US Army forever. I mean, we thought we were going to get that last fall. And then, you know, a bunch of things happened like the government shut and so on and so forth. But momentum was building and we were trying to, you know, lean into that a little bit in our first quarter call. And actually came up like, I think the next day or pretty close to it. And then the similarly with the MV75 with that program is getting a lot of attention in our company. It's going very well. And we have a very constructive working relationship with Bell. We were. Expecting, though, that that would happen a little bit sooner than it did. So we you know, again, big orders tend to take longer than you would think. Originally. But beyond that. I can't say there was anything that was a real big surprise. I mean. Like I spelled out in my little speech here, higher volume is a major driver for higher margins. And we've been seeing our volume increase. And as our volume increases, our margins increase. So it's a it's a good virtuous cycle. There. Nancy. I don't know if there's any surprises you'd like to point to. No, I agree with that. It's just general strength in the industry. Perfect. And then maybe if you could talk more on like these emerging aircraft trends thinking EV tolls, you know, some of the drones and other opportunities in defense. How are you guys kind of playing into that? Is there anything from like a product development perspective you can touch on? And what do you kind of seeing for demand in there? Yeah. I don't know if there's much we can say that we haven't already said. We are quite involved and invested in the EV. Tall market and some of our technologies, especially on the power generation side. Play very nicely in the drone. You know, unmanned or autonomous aircraft side. Those programs are progressing. EV tall aircraft are moving closer to certification and actually flying missions. So. So we're excited about those things. We do not have a big commitment to those in our 2026 forecast. You know it's it's more of an if come, I would say in 2027. So we're going to start our 2027. Ground up. Planning over the next couple of months. And, and I think it'll be there'll be a bigger role for those programs in 2027. But at this point, it's still pretty preliminary. And there's not much more to say than what I just said. I. Appreciate I'll leave it there. Thank you. Thank you. Next question comes from the line of John Tanwanteng with CJS Securities. Please proceed. Hey, this is William for John. Thanks for taking our questions. How should we think about your test segment margins as you ramp up production for the Army Radio test business over the next 2 to 3 quarters? Well, I'm pretty optimistic about it. So I think you should be too. It's a it's a it's a really well priced program. And we're going to get into it as quickly as we can. However, we're going to walk before we run. So the exact pace of implementation is a little bit hard to predict. I think it's safe to say that as we exit the fourth quarter. We'll be at full run rate production. And, and that, you know, once we get into full run rate production, that $44 million order should be should last about a year of effort. So, you know, depending on how quickly we can accelerate and get going in the third quarter here and the fourth quarter. I expect there will be good. You know, it'll reflect well in our financials. Once we're in full. Full rate production. We are expecting that the margin profile in our test business should start to approach what we routinely get out of our aerospace business, maybe not up at the 20% EBITDA level, but but pretty close. So, you know, we'll know for sure as that program ramps. And we'll be sure to talk about it on these calls. I think by the time the fourth quarter is done and we're moving into the first quarter, we'll have a really good idea of where that's going to end up. Nancy would you say anything different? No, I would agree with that. That is very. Helpful. Thank you. And just one more for me. Can you talk about the transition to allow satellite connectivity and how you're seeing that play out in your markets and opportunity set? I'm optimistic about the transition to Leo. There's not much I can say about it today, but we are working the situation pretty hard. The short term impact, though, is disruption for some of our geo customers and geo programs. So it's probably worth pointing out that parts of our business. I mean, we're we're doing pretty well overall, but there certainly are parts of our business that are, you know, a little bit under the weather. And the geo part of our business is, is one of those it's think of it as maybe a $60 million piece of business at this point on an annualized basis, but, but I think. The opportunity that that's out there for Leo, for us more than more than offsets the short term pain that we're that the geo market is experiencing. So not much official we can say today, but we are working it hard and we're optimistic about the prospects. Thank you. I'll leave. It there. All right. The next question comes from the line of Gautam Khanna with TD Cowen. Please proceed. Hey. Thank you. I was I had a couple questions First, curious on your pricing comment. How much of that has already manifested in of the stuff you've repriced in the Q2 numbers and should we think that in the second half, we're going to have higher pricing than what was experienced in the second quarter? And then I have a follow up. I would say not materially, but I think what you're seeing now is what we're going to get with respect to pricing. The answer to your first question is a little bit hard to to quantify, but I guess our feeling is that we're like 75 or 80% of the way through the, you know, big price adjustment. Journey. That we were on as a result of the inflation that hit during the pandemic. But there is still more to go. And over the next 12 to 18 months, the remaining part of our long term contract should be renegotiated. That will be helpful. And, and we do have a fair amount of our business that is more short term oriented. So there is pricing flexibility there in the sense that you don't get locked in the, you know, long term pricing. So if we get a disruption on the cost side, certainly we can adjust their more quickly. Whereas the long term contracts are, are more difficult to manage in a changing environment. So I feel pretty good about where we are. A year ago, it was much more of a challenge. Two years ago it was a real problem. I think we feel like we're on the other side of the, you know, near the end of the tunnel with respect to pricing. Now. That's. And then just curious about your expectations for second half mix. If, if anything, I know that you called out the 2 million refund, but anything else in kind of the. Margin. Expectations in the second half that you could give us whether it be. Yeah yeah. Go ahead. Sorry. And the big thing there is is the radio test program for the US Army that we're talking about just layering in that in. The second half. Should, you know, pretty significantly change the margin profile in our test business, which, you know, has been hurting us more than helping us over the last few years. So, so that's the big mix issue. There will be other puts and takes in the aerospace part of our business. But at this point, I don't feel like there's anything that's, you know, too noteworthy that we know for sure that we can talk about. Okay, last one on me. 75. How much? Visibility do you have with Textron? The prime on what you got? Because I know that the funding concern. If it's not done by September 30th, but just do you guys have orders beyond September 30th to work on it? We do. We have orders. And we do work very closely with Bell. I can't say that we know anything about the funding status. That's not generally known out there in the world. They've done a pretty good job, in my view, of being transparent. To the extent they can about the situation. But they're they've been covering us. And so we feel good about that. We also, you know, recognize that our portion of the development cost of this program is probably pretty small compared to some other companies. So maybe we're not involved in some of the discussions that other companies are. I can't tell you that for sure, but, you know, we're we're overall, we remain highly enthusiastic about that program. We feel like our part of it is going very well. And we get supported well by Bell. So so it's all good. Thank you very much. Thank you. As a reminder, if you would like to ask a question, please press star one on your telephone keypad. And the next question comes from the line of Alexandra Mandery with. Truist Securities. Please proceed. And Nancy great results and thanks for taking my question. So how has the acquisition of BMA performed relative to your expectations, and what is your appetite for M&A going forward? Are there any capabilities you look to add or geographies to expand into or increase content in? We're pretty pleased with the BMA acquisition so far. You know, it's it's a smaller operation and it was part of a private company. So bringing it up to public company standards in terms of accounting and, you know, the US GAAP rules are quite different than the companies located in Germany. So it's used to, you know, private company, German accounting. So there's a there's some transition there. It also had a parent that was involved in the German automotive industry primarily, but also some other industrial areas. And, and that's been a difficult environment for a while. So they were a little bit capital starved. We're fixing that. We think they have good technology, good products, good relationships with customers. They're not as profitable as the rest of our aerospace business. So we're going to work on that. That's another part of the long term. You know, contracting challenge with pricing. Frankly. But I'd say overall, it's it's going pretty well. We haven't reporting through our French operation. They those two companies were competitors. Now they're learning to work together. And that seems to be going pretty well too. Both our French team and PGA and Chateauroux and, and the BMA group at Lake Constance want to want to make that work. So we're encouraged by how that process is playing out. Also. As for your second question, you know, we have done a number of acquisitions over the years. We've been pretty quiet on acquisitions over the last few years. During the pandemic, because our balance sheet. Frankly, wouldn't allow us to do much. And there wasn't much to do. I mean, there wasn't a whole lot of movement in the commercial aerospace market in terms of M&A activity during that period of time. We think our balance sheet is largely fixed now, and we think that the M&A market is opening up. So we're seeing a steady flow of opportunities. And we are. Looking. But we are also mindful that we have just a great opportunity set ahead of us in terms of, you know. Generic. Internal growth. So our first priority is definitely to execute on those programs. If M&A comes up, you know, we'll we'll take a look. I think we're capable and qualified to do that at this point. But that isn't we're not a company that's going to depend on M&A for a big part of our growth opportunity. Go. Forward. That's more I would call that more incidental if and when it happens. Does that make sense? No. And I appreciate that color. And I guess one follow up. So you mentioned labor has improved and there are continued opportunities for improvement. What are the efforts you've taken to retain labor thus far? And, you know, finding new labor. Alex, I don't know if it's you or it's me, but that was really choppy and I couldn't really hear you. Hopefully you. Can hear me a bit better now. Just want to see if you had any color on, you know, the efforts you've taken to retain labor and finding new labor. Yeah. Joe, is there any way you can clear her line more? Not sure. But I think Alexandra's question was, is there any way you retain labor or. Okay. Now. You're happy too, Joe. So maybe it's on our line. Alexandra. Can you. Repeat your question one more time? Hey. Yeah, I just wanted to see if you guys had any color on the efforts you've taken to retain labor thus far and finding new labor. We're going to. Try to call in on a cell phone momentarily. See if we can fix this. Okay. Ladies and gentlemen, please stand by as we try to fix this tentacle issue. Thank you. Okay, everybody, the speakers are back in. Alexandra, if you were still there, can you. Restate your question, please? Hey, hopefully. You guys can hear me now. I just wanted to see if you had any color on, you know, the efforts you've taken to retain labor thus far and finding new labor. Sure. And we can hear you, Alex. Sorry about that. You know, it's interesting. As kind of an armchair economist, we have a we're a smaller company, but we run operations. Really all across our country. Seattle, LA, Florida, New Hampshire, New York, Chicago, and, and it's interesting that there are pressures in different places at different times. But for the most part, the markets all kind of move together. So during the Great Resignation, during the pandemic, we had trouble hiring everywhere. And today the labor market has, from my perspective, kind of bounced back and people have become much more available, including a lot of people who. Left who, you know, decided maybe the grass wasn't greener on the other side and are. Are interested in coming back. So at this point, we don't feel that hiring is a major issue. There are retention challenges in the sense that especially for certain, you know, production related jobs, you if you have ten openings, you might have to hire 14 people to get ten that stick. So so our turnover metrics still don't look the way they did prior to. You know, the, the pandemic, but we went from 3000 people down to 2200. And as you climb back up to 3000, you know, you instead of hiring 800, you got to hire. I don't know, 1200 or something to make that work. So, so it's never easy. It's always a challenge. But I would say that we feel much better about labor availability than we did. At any other time during the last 3 or 4 years. Again. Nancy would you change that at all? No, I wouldn't. Then answer your question. Alex. Okay. That's what I like about Nancy she very rarely changes what I say. So does Yeah, perfect. Thank you so much. All right. Thank you. Thank you. Ladies and gentlemen, this concludes question and answer session. And this also concludes today's conference. You may disconnect your lines at this time. And we thank you for your participation.