standing by. Welcome to the first quarter 2024 Ducommun earnings conference call. At this time, all participants are in listen-only mode. After this speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Suman Mookerji, Chief Financial Officer. Please go ahead. Thank you, and welcome to Ducommun's 2024 first quarter conference call. With me today is Steve Oswald, Chairman, President, and CEO. I'm going to discuss certain limitations to any forward-looking statements regarding future events, projections, or performance that we may make during the prepared remarks or the Q&A session that follows. Certain statements today that are not historical facts, including any statements as to future market conditions, results of operations, and financial projections, are forward-looking statements under the Private Securities Litigation Reform Act of 1995 and are therefore prospective. These forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from the future results expressed or implied by such forward-looking statements. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we can give no assurance that such expectations will prove to have been correct. In addition, estimates of future operating results are based on the company's current business, which is subject to change. Particular risks facing Ducommun include, among others, the cyclicality of our end-use markets, the level of U.S. government defense spending, our customers may experience delays in the launch and certification of new products, timing of orders from our customers, legal and regulatory risks, the cost of expansion and acquisitions, competition, economic and geopolitical developments, including supply chain issues and rising or high interest rates, the ability to attract and retain key personnel and avoid labor disruptions, the ability to adequately protect and enforce intellectual property rights, pandemics, disasters, natural or otherwise, and risk of cybersecurity attacks. Please refer to our annual report on Form 10-K, quarterly reports on Form 10-Q, and other reports filed from time to time with the SEC, as well as the press release issued today for a detailed discussion of the risks. Our forward-looking statements are subject to those risks. Statements made during this call are only as of the time made, and we do not intend to update any statements made in this presentation except if and as required by regulatory authorities. This call also includes non-GAAP financial measures. Please refer to our filings with the SEC for a reconciliation of the GAAP to non-GAAP measures referenced on this call. We filed our Q1 2024 quarterly report on Form 10-Q with the SEC today. I would now like to turn the call over to Steve Oswald for a review of the operating results. Steve. Okay. Thank you, Suman. Thanks, everyone, for joining us today for our first quarter conference call. Today, and as usual, I will give an update on the current situation at the company. Afterwards, Suman will review our financials in detail. Let me start off with an update on our continued progress towards Vision 2027. For background, this vision and strategy was developed coming out of the COVID pandemic over the summer and fall of 2022, unanimously approved by the Ducommun board in November 2022, and then presented to investors the following month in New York. We got excellent feedback. Since that time, Ducommun management has been executing the Vision 2027 strategy by consolidating its facility footprint, continuing its targeted acquisition program, increasing the revenue proportion of engineered product and aftermarket content, executing our offloading strategy with defense primes in high-growth segments of the defense budget, and by expanding content on key commercial aerospace platforms. We all have conviction in the Vision 2027 goals and strategy and believe the near-term and mid-term catalysts, along with strong results ahead for DCO, present a unique long-term value creation opportunity for shareholders. The Q1 2024 results were a very good example of the strategy at work. Q1 was an outstanding quarter and a great start to the year for Ducommun. Revenues exceeded $190 million for the third consecutive quarter and $190.8 million, growing 5.3% over the prior year. Strong growth in our commercial aircraft businesses across both Boeing and Airbus, along with our rotorcraft business, helped drive revenue during the quarter. Recovery on the 787 was notable, with revenues more than doubling over the prior year period, as well as strong growth on the A220 platform, where we make the skins for the entire fuselage. Overall, commercial aerospace with Airbus and Boeing and others was up 11% from Q1 2023 despite Boeing and Spirit's continued challenges with max quality issues. We have now grown our year-over-year revenue in our commercial aerospace business for 11 consecutive quarters, demonstrating the resilience of our business even in a challenging OEM environment. Our defense business grew 1% year-over-year, with strong demand for the Black Hawk, Apache, and F-35 platforms, as well as selected naval programs, including the Phalanx close-in weapon system and other weapon systems for submarines. Growth was partially offset by declines in legacy programs such as the F/A-18, which we have talked about in the past, and a pause in the TOW missile production, for which we expect a new contract and anticipate starting shipments again in 2025. Defense business was almost $100 million in revenue in the first quarter. We remain optimistic about the growth ahead. As we go through a timing transition on certain programs, the ever-growing backlog in defense tells the story, up $125 million from last year and $42 million from Q4 2023. Defense backlog now stands at over $500 million, at $569 million. Significant wins with RTX in Q1 were an important driver for the increased defense backlog. The SPY-6 program is part of the U.S. Navy's family of radars that performs air and missile defense on seven classes of ships, as a giant leap for the fleet. SPY-6 radars are integrated, meaning they can defend against ballistic missiles, cruise missiles, hypersonic missiles, hostile aircraft, and surface ships simultaneously. Ducommun has been providing one card for the program, as this is part of the offloading strategy we've been working on. I'm very happy to report that we've been awarded a second card from RTX for the SPY-6 in Q1 after 18 months of work. These are a slow transition, as I've mentioned in the past, and it should be. Now it pays off. The order for two cards in Q1, one new and one a follow-on, was over $50 million. This is also great news as we are now building out a much bigger business in radar support, complementing our long-term track record in missile support. The new card award deliveries are expected to begin in 2025, and the current card shipments are ongoing. As communicated on the overall offloading program, we anticipate that the long-term run rate of the SPY-6 and other defense programs already commercialized or in development will now be $135 million in 2025, an increase of $10 million over our prior target of $125 million for 2025. It has been a long journey, but well worth it. Another real highlight in Q1 was gross margin of 24.6% for the quarter, up 430 basis points year-over-year from 20.3%, as we continue to realize benefits from our strategic value pricing initiatives, productivity improvements, growing the engineered product portfolio, and initial restructuring savings. We also made significant reductions in the scope of our operations at our Berryville, Arkansas facility during Q1, with several programs fully transitioned to Ducommun's Joplin, Missouri facility, roughly 200 miles away. This has allowed us to start realizing a portion of the savings expected for Berryville closure during the first quarter, with one more program left to transition with RTX. We also continue to make a full effort with Boeing Commercial and Boeing Defense on the MAX spoilers and Apache tail rotor, respectively, working with them on approvals and building buffer. We are in the final transition phase with some headwinds in Q2 and Q3 of this year. But long-term, we are driving to a great outcome for Ducommun, Boeing, and our shareholders. For adjusted operating income margins in Q1, the team delivered 9% compared to 7.5% in Q1 2023, a great result driven by the continued growth in our engineered product businesses and with our restructuring savings beginning to kick in during the quarter. Adjusted EBITDA was another great story in Q1, at 14.4% of revenue compared to 12.7% in Q1 2023. 170 basis point improvement year over year gives Ducommun a great start to 2024 as we work towards the 18% for the Vision 2027 goals. The GAAP diluted EPS was $0.46 a share in Q1 2024 versus $0.42 a share for Q1 2023. And with the adjustments, diluted EPS was a solid $0.70 a share compared to a diluted EPS of $0.63 a share in the prior year quarter. The higher GAAP and adjusted diluted EPS was driven by improved operating income as well as lower interest costs during the quarter. The company's consolidated backlog increased sequentially and compared to the prior year quarter. Total company backlog ended Q1 at a record of $1.046 billion, increasing over $52 million sequentially, and it was $85 million year over year. Defense backlog, as mentioned earlier, also increased $125 million compared to the prior year quarter to end at a record of $569 million. Strong defense backlog reaffirms that Ducommun's defense business remains well positioned with more positive news to come. The commercial aerospace backlog decreased slightly year-over-year, primarily due to industry issues with the single aisle production rates and the MAX issues mentioned earlier with Boeing and Spirit. However, our commercial aerospace backlog still grew relative to Q4 2023 at $442 million. In Q1, our team delivered another good quarter managing the supply chain, as evidenced by another quarter of positive revenue growth and significant growth margin expansion compared to the prior year period. For revenue guidance in the remainder of 2024, we continue to believe that the uncertainty surrounding BA, Spirit, and the FAA at this point on the MAX, the best approach is to again guide to mid-single-digit, and look to further updates on the next earnings call. We do see a slowdown in the MAX build rates, not for the wrong reasons, in Q2 and Q3 for this year, where commercial aerospace will be a bit lighter due to the situation. Despite softness in the MAX, which is a major program for us, we are comforted by continued strength on other programs such as the 787 and Airbus programs, including the A220. The best part is the MAX build rate will eventually be at a much higher level, and we continue to work on gaining more share. The strong bookings and growing backlog in our defense business is also supportive of our revenue outlook. Now, let me provide some additional color on our markets, products, and programs. Beginning with our military and space sector, we experienced revenue just below $100 million, at $98.9 million compared to $97.7 million in Q1 2023. While growth was muted, we saw positive signs in our military helicopter products, including strong demand on the Black Hawk program, with revenues growing over 70%, and also for Apache tail rotor blades, which grew more than 50% year-over-year. Our naval business also performed well. We saw strong growth on the Phalanx close-in weapon system used on surface ships, as well as other weapon systems for submarines. First quarter's military and space revenue represented 52% of Ducommun's revenue in the period, down from 59% back in 2022 and 70% in 2021. We expect that this trend will continue, reflecting more balance with commercial aerospace, which we like. We also ended the first quarter with a backlog of $569 million, an increase of $125 million year-over-year, representing 54% of Ducommun's total backlog. Within our commercial aerospace operations, first quarter revenue continued to see double-digit growth, increasing 11% year-over-year to $80 million, driven mainly by build rate increases on large aircraft platforms, including the 737 MAX, 787, and A220 platforms, along with growth on commercial rotary wing aircraft platforms and regional and business jets. As many of you are aware, the FAA announced in January that it will increase its oversight of Boeing and require Boeing to get FAA approval for production rate increases for the 737 MAX. This will likely cap production on the 737 MAX. We do, however, expect the long-term trend to remain very positive once the issues are fully addressed. This rate limitation did not have a significant impact on our first quarter results. The backlog within our commercial aerospace business was $442 million at the end of the first quarter, increasing over $12 million sequentially, a solid number given the temporary weakness in the commercial aerospace markets. With that, I'll have Suman review our financial results in detail. Suman. Thank you, Steve. As a reminder, please see the company's Q1, 10-Q, and Q1 earnings release for a further description of information mentioned on today's call. As Steve discussed, our first quarter results reflected another period of strong performance. Despite industry headwinds, we again saw a significant increase in our commercial aerospace revenues. We remain encouraged by the continued strength in domestic and global travel, which should support higher long-term demand for aircraft as we work through some of the industry issues impacting single aisle production rates. In addition, we are encouraged by the record backlog we achieved in the first quarter, especially in our military and space end-user segment. With all this, we feel like we are beginning 2024 with good momentum that will continue to drive our performance. Now, turning to our first quarter results. Revenue for the first quarter of 2024 was $190.8 million versus $181.2 million for the first quarter of 2023. The year-over-year increase of 5.3% reflects growth in all three of our end-user segments, highlighted by $8.1 million of growth across our commercial aerospace platforms and $1.3 million of growth in our military and space platforms. We posted total gross profit of $46.9 million, or 24.6% of revenue for the quarter, versus $36.8 million, or 20.3% of revenue in the prior year period. We continue to provide adjusted gross margins as we have certain non-GAAP cost of sales items in the current and prior period relating to inventory step-up amortization on our recent acquisitions, restructuring charges, and the impact from the Guaymas fire on our operations. On an adjusted basis, our gross margins were 25% in Q1 2024 versus 21.1% in Q1 2023. The improvement in gross margin was driven by our growing engineered products portfolio, strategic pricing initiatives, productivity improvements, and some initial restructuring savings. We continue to make progress working through a difficult operating environment with supply chain and labor. Through our proactive efforts, including strategic buys and our inventory investments, we have been able to avoid any significant impacts thus far on our business. During the first quarter of 2024, we increased our inventory by $9.8 million from year-end 2023 to position our performance centers to meet our 2024 delivery commitments. We also grew our contract assets net of contract liabilities by $15 million. We continue to look for opportunities to unwind our working capital investments to improve our cash flow. Ducommun reported operating income for the first quarter of $12.6 million, or 6.6% of revenue, compared to $6.4 million, or 3.5% of revenue in the prior year period. Adjusted operating income was $17.1 million, or 9% of revenue this quarter, compared to $13.6 million, or 7.5% of revenue in the comparable period last year. The company reported net income for the first quarter of 2024 of $6.8 million, or $0.46 per diluted share, compared to net income of $5.2 million, or $0.42 per diluted share a year ago. On an adjusted basis, the company reported net income of $10.4 million, or $0.70 per diluted share, compared to net income of $7.9 million, or $0.63 in Q1 2023. The higher net income and adjusted net income during the quarter were driven by the higher operating income and adjusted operating income. Additionally, our interest rate hedge helped to reduce our year-over-year interest expense. Now, let me turn to our segment results. Our Structural Systems segment posted revenue of $83.3 million in the first quarter of 2024 versus $75.6 million last year. The year-over-year increase reflected $5.7 million of higher sales across our commercial aerospace applications, including the 787, 737 MAX, and the A220, in addition to selected commercial rotorcraft platforms and $2.1 million of higher revenue within the military and space markets, driven by strength in the Black Hawk and Apache programs. Structural Systems operating income for the quarter was $2.9 million, or 3.4% of revenue, compared to $4.7 million, or 6.3% of revenue for the prior year quarter. Excluding restructuring charges and other adjustments in both years, the segment operating margin was 7.8% in Q1 2024 versus 12.9% in Q1 2023. This can be attributed to higher costs in our Monrovia plant as it winds down production, reducing operating margins year-over-year. Our Electronic Systems segment posted revenue of $107.5 million in the first quarter of 2024 versus $105.6 million in the prior year period. The increase was mainly due to growth across the commercial aerospace platforms and certain military platforms, including the F-35, and naval programs such as the Phalanx close-in weapon system and submarine launch missile launch systems, partially offset by the impact and timing of reduction in legacy platforms such as the F/A-18. Electronic Systems operating income for the first quarter was $19 million, or 17.6% of revenue, versus $10 million, or 9.4% of revenue in the prior year period. Excluding restructuring charges and other adjustments in both years, the segment operating margin was 18.4% in Q1 2024 versus 11.6% in Q1 2023. The year-over-year increase was due to favorable product mix, including growth in our Engineered Products portfolio, strategic pricing initiatives, as well as savings from restructuring programs beginning to kick in during the quarter. The restructuring savings were driven by the transition of product lines from our Monrovia performance center to other facilities. Next, to provide an update on restructuring. As a reminder, and as previously discussed, we commenced a restructuring initiative back in 2022. These actions are being taken to accelerate the achievement of our strategic goals and to better position the company for stronger performance in the short and long term. This includes the shutdown of our facilities in Monrovia, California, and Berryville, Arkansas, and the transfer of that work to our low-cost operation in Guaymas, Mexico, and to other existing performance centers in the United States. We continue to make progress on these transitions with excellent employee retention and engagement and are also working diligently with our customers, Boeing and RTX, to obtain the requisite approvals. During Q1 2024, we recorded $1.4 million in restructuring charges. The majority of these charges were severance and related benefits as we continue to wind down the two operations. The recertification process is ongoing, and we plan to complete production at both facilities by the end of the second quarter. We expect to incur an additional $5-$6 million in restructuring expenses through the end of 2024 as we complete the program. Upon the completion of our restructuring program, we expect to generate $11-$13 million in annual savings from our actions and are beginning to see realization of these actions in this year. We anticipate selling the land and building at both Monrovia, California, and Berryville, Arkansas. Turning next to liquidity and capital resources. During Q1 2024, we used $1.6 million in cash flow from operating activities, which was an improvement compared to Q1 2023 usage of $18.9 million. The improvement was due to a smaller increase in inventories and higher contract liabilities, partially offset by higher contract assets. As of the end of the first quarter, we had available liquidity of $208.1 million, comprising the unutilized portion of our revolver and cash on hand. Our existing credit facility was put in place in July 2023 at an opportune time in the credit markets, allowing us to reduce our spread, increase the size of our revolver, and allowing us the flexibility to execute on our acquisition strategy. Interest expense was $3.9 million compared to $4.2 million in Q1 of 2023. The year-over-year improvement in interest cost, despite a higher debt balance, was due to the interest rate hedge going into effect. In November 2021, we put in place an interest rate hedge that went into effect for a 7-year period starting January 2024 and pegs the 1-month Term SOFR at 170 basis points for $150 million of our debt. The hedge resulted in interest savings of $1.3 million in Q1 2024 and will continue to drive significant interest cost savings in 2024 and beyond. To conclude the financial overview for Q1 2024, I would like to say that we had a strong start to 2024 and anticipate a strong balance of the year. I'll now turn it back over to Steve for his closing remarks. Steve. Okay. Thanks, Suman. In closing, Q1 was an excellent quarter, a record in some cases, with many highlights for the company and our shareholders. The strong start to the year with solid revenue and earnings growth certainly strengthens our path to delivering on the goals we set out in the Vision 2027. 2024 is also our 175th year of continuous operation, a great achievement, and we'll be recognizing that through the year. I did the math recently, and the door at the company has been continuously open for over 43,000 business days, a long time in a young country like the United States. What a great story with a very bright future ahead for the company, our shareholders, and all other stakeholders. Thank you for listening. Let's now open up for questions. Thank you. At this time, we'll conduct the question-and-answer session. As a reminder, to ask a question, you'll need to press Star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press Star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from a line of Mike Crawford of B. Riley Securities. Your line is now open. Thank you. Steve, what are some of the main pressure points you're trying to avoid with the strategic inventory buys? Would it be titanium, which is becoming a problem for some, or what else are you trying to get away from? Yeah. Thank you. Thank you. Good morning. Yes. Look, titanium is obviously a big one. I mean, as the wide-body A350 and these other platforms start going up, and obviously with the situation in Russia, it's something that we've been very proactive over the last couple of years and are in really good shape with our titanium. The other thing we did on strategic buy was really around the card business. I know there's less drama now than there was in the past, but we did go out and buy ahead on certain things for circuit cards. Obviously, it's an important business for us, just getting even more important. So I'd say those two, I think we're in good shape. We're not going to plan on doing as long as things. I mean, titanium aside on things like for the circuit cards, we'll probably just continue to take it day by day. But those are the two reports I have. Okay. Excellent. And then, I mean, you did call out the F/A-18 as a legacy platform that's in decline. One that might eventually get that way could be the Black Hawk, although that's going up for you now. What are maybe some of the other key platforms that are growing for you and conversely maybe phasing out a little bit just given the transition? Sure. Sure. I'd say, look, you're spot on. The F/A-18 is the one, right? So we all know about the F/A-18. We know what's happening in St. Louis. We are going to see, I think, still good business in depot maintenance and other things. So that's still going to be an okay program for us. That's kind of the biggest one. I talked about the TOW missile. Again, these things are timing-related, so we're going to see the TOW come back. We're going to start shipping again, we plan, in 2025. I mean, as far as on the positive side, I mean, we couldn't be happier with the Black Hawk business. I mean, even though I know there's lots of discussion and everything, that business is going great for us, the Apache. I'd also mention that we're just starting to move higher and higher in the Seahawk at Sikorsky as well. So our rotary business was terrific. Despite the F/A-18, we still had great volume in the F-35 and some other programs. And so we're feeling very good, especially with the backlog, Mike, and just getting the second contract. All the other missiles programs, if I may add, are also giving us strength, including the MIR missile, the Standard Missile, and as Steve previously pointed out, the SPY-6 radar and next generation Jammer. So missiles and radar programs are helping offset the decline in the legacy programs. Yeah. And the transition timing. Right. Right. Okay. Thank you. Just one final one from me, kind of related to the rotary platforms. So it's now just over a year since you acquired BLR Aerospace, and I know one of the goals there was to maybe try to get some of their unique structures into military aircraft. Is there some progress there? We're working on it right now. And Mike, you're spot on on that. Our bigger opportunity is really with the Black Hawk, and that's really through the National Guard. So we have a lot of things, I think, that these things obviously take time, right? But we're excited. We think that also with some of the other news about switching out the engine on that, I think there's more opportunity for that. So stay tuned on that. All right. Excellent. Thank you. Thanks. Thank you. One moment for our next question. Our next question comes from a line of Michael Ciarmoli of Truist Securities. Your line is now open. Hey. Good afternoon, guys. Thanks for taking the questions. Nice results. Maybe kind of a two-part, I guess, Steve or Suman. Just the margins, really strong in the ES segment. You commented on pricing, and I know you threw out the value-based, and I think that's something we hear pretty often now. Anything you guys are doing differently with pricing outside of just taking advantage of the whole inflationary environment? And then just how do we think about these electronic systems margins going forward? I think that was a record level. I'd hate to kind of say, "Okay. Let's extrapolate this." It sounded like you got some mix in there as well. But any color on both those items? Yes, Mike. And a great question. We're really happy with the electronic systems margins this quarter. As you noted, pricing is a key factor. Certainly, as you have seen across the aftermarket in the industry, pricing has been strong, and we have seen the same. But kind of beyond that, there are a couple of other things at play here, kind of two themes that are key drivers of our Vision 2027 strategy. And one is growing the Engineered Products portfolio. And as that continues to grow as a percentage of the revenue in the Electronic Systems business, the drop-through is really good. So we've had good growth in kind of Engineered Products businesses. And the second is the consolidation of footprint strategy, right? And that has also started kicking in this quarter with programs getting fully transitioned from our Berryville Performance Center to our Joplin Performance Center and us taking out a significant amount of cost early in the quarter out of the Berryville facility, which now has a skeleton crew and only one active program. Those other programs are now being produced out of Joplin without much addition to overhead and SG&A in that business. So that's really driving the margins, those two factors. And outside of some minor impacts of product mix, I think the general trend is sustainable. And I mean, the current margins we're seeing within a narrow band is sustainable going forward. Okay. Any way to quantify what you saw from the run rate consolidation savings? I know you said 11-13 annualized, so it sounds like you got some. Any way to quantify that? Still in the early stages of that. It's over $1 million during the current quarter. So it's, yeah. Yeah. I think, Mike, I think it's a good story. I mean, look, we're thrilled with the number, right? You're spot on about the 18%. So we're excited about that. We think that, again, as we move into the second year of Vision 2027, these things are coming together, and we're obviously driving value pricing across the board, right? So that's going to help. Got it. And then I guess conversely, on Structural Systems, sounds like you're just dealing with overhead under absorption issues as you transition, it sounds like. I mean, should we expect that margin rate to persist next two quarters? And I guess it doesn't sound like anything really out of the normal except for just the kind of wind-down drag. Yes. I mean, our Monrovia Performance Center, which is being wound down, revenues were almost a third of what they were on a year-over-year quarter basis, almost half on a sequential quarter basis. So that's naturally going to create a significant amount of drag on margins. And as you can imagine, in a facility being wound down, it's not that easy, right? So we do expect that to linger for the next one to two quarters but gradually improve. The trend is going to be improvement. It's not and then really, the benefits of the complete closure will only kick in in 2025 when we not only shut down the facility in Monrovia here in 2024 but then start actively producing some of those products out of Guaymas in 2025. Yeah. And Mike, just for everybody on the call too, Monrovia is very close to Los Angeles. It's in that area, and it's the size of an aircraft carrier, okay? So it's not a small plant, all right? So it's been around for a long time too. So good things ahead there. We're at the three yard line here, so in Monrovia. Got it. Got it. Last one for me, Stephen. I don't want to put words in your mouth or numbers here, but I think you started the defense offloading. I don't know if that was really in earnest in late 2020 or 2021. But if you're thinking $135 million by 2025, I mean, I could go back and take your 2020 defense revenue run rate, and I could get something north of $550 million by 2025. Obviously, you're losing some work in there, F/A-18. I'm sure there's some other programs. But how should we think about this defense growth trajectory? Again, it might not be apples to apples the way I'm thinking about it, but I can come up with some pretty sharp growth there. Yeah. You're right. It's some. Even I'm looking at the numbers here as we speak here, like a company like GA, right? So we've had a couple of really good years with GA. But as you know, that whole market's been disrupted for them because of these lower costs of UAVs and everything, right? So our volume is down on there. The F/A-18, we talked about some other stuff. But a lot of what we're seeing, we're seeing a lot of repeat orders, but we're getting the Next Generation Jammer that's coming out of RTX, and we're getting Appleton. So we consider that offload, right? We consider that. You know what I mean? So even though you might say, "Well, no. They had it. They went to us and said, "We love what you guys are doing. Take it." Same thing with the SPY-6. So I think that it's not apples to apples, but I think overall, the story, I think, holds pretty well. And that's what we want. We want to—as you know, there's a lot of new programs out there, and these things delay, and you know all that. But we want the stuff that's got a long, long life, like the SPY-6, right? It's got to be in the fleet forever. And we want that current business, and that's what we're doing. You know what I mean? As well as the new stuff went, right? That's as well. So I think there's more to come on that, okay, as well when we get to 2026 and 2027. But let's hold it now at 135. Got it. All right. Good stuff. I'll jump back and kick you guys. Thanks, Mike. Thank you. One moment for our next question. Our next question comes from a line of Ken Herbert of RBC Capital Markets. Your line is now open. Yeah. Hi. Good morning, Steve and Suman. Morning, Ken. Morning. Hey, Steve. When we look at the gross margins in the first quarter, is there any reason that they would step down in the second quarter, or is this gross margin run rate now something we should model moving forward? I'll take a first stab at that, Ken. And no, we are really happy with the gross margins in the first quarter, as I said, on the electronic side, driven by engineered products, the restructuring savings. And that really were the key drivers. If you look at the overall company, they were partially offset by the headwinds we had in Monrovia in the structures business. Outside of, I would say, marginal benefits from product mix during the quarter, these gross margins within a fairly narrow band are sustainable. And I mean, if you were to look at our adjusted gross margin in Q4, it was 23.2% of last year, and it's now 25%. So if you look at quarter-over-year, it's a big difference, and especially with some of the adjustments. But I think we've been able to take more of the adjustments into the GAAP gross margin, which is a really good thing. And I would say we feel really good about these margins going forward within a narrow range. Great. Thank you. And can you level set us on your expected, I guess, either max deliveries this year or sort of a monthly or quarterly production rate? Because it sounds like there's maybe a step down sequentially from the first to the second to the third quarter, but maybe an anticipated uptick in the back of the year. Can you maybe sort of comment on where you are on that program and how we should think about the cadence for the year on the max? Yeah. So yeah, good question. So look, we had a fairly good first quarter because there was a lot of things still happening, right, until this terrible thing happened, obviously, in January. Then lots of things came after that. So Q1 was pretty good. April was a bit light. So we're going to anticipate a little bit lighter action on it because remember, we're both feeding Spirit, which is a major customer, as well as Boeing OEM, right, so BCA. So right now, we're thinking maybe it's in the mid-20s, lower to mid-20s for the second quarter. We'll have to figure out the third when we get there, right, based on their progress. But we see it coming back. The nice thing is too for shareholders and for all of us, I mean, we're working real hard with and I don't want to can't go making any announcement right now. We're working on gaining share on the MAX, okay, as well as the A320. So we're working on those types of things. And so I think, Ken, we're going to get a little shallower, maybe mid-20s. Certainly, it's been a little lighter in April, but nothing we're concerned, but we want to be transparent. But we have the 787, which I know has its own problems, but we're seeing a nice bounce back there. We're happy with our Airbus business, as well as GS. Great. Thanks. Just finally, Steve, where would you see the opportunity on the A320 or even the A220 to take share, and what could be the timing around some of the share gains with Airbus on the narrowbody portfolio? Yeah. Again, we're looking probably within 12 months. So we're working on something right now. We'll see how it goes, right, because these things are these things take time. But we think within 12 months, we might have something going again on the A320. And the A220, we could just continue to work, continue to grow. As you know, that's a major program for us, and good things ahead there. Great. Thanks, Steve. Thanks, Suman. Thanks, Ken. Thank you. Thank you. One moment for our next question. Again, as a reminder, to ask a question, you'll need to press star 11 on your telephone. Our next question comes from a line of Jason Gursky of Citi. Your line is now open. Jason Gursky, your line is now open. So apologies. I had myself on mute. Good morning, everybody. Thanks for taking the question. Hello, Jason. Steve, I wanted to ask a little bit more about Vision 2027 and, in particular, the M&A component of the vision there because you've got some inorganic growth I think you'd like to get done. So yeah, the question, I guess, is maybe a bit of a two-part question. We've got a company that just recently went public that's now got access to some more money that claims that it's going to go out and be heavily involved in buying up proprietary product-type companies. So I'm just kind of curious what the competitive environment looks like these days for assets. So I guess, A, the pipelines. What's the pipeline looking like? What's the competitive environment look like? And then I also want to just kind of get your take on the size and scale of things that you guys would be willing to chew off and maybe talk a little bit about the dynamic that's going on there with one of your big customers in Spirit and the Airbus work because that seems like if Boeing buys Spirit, that Airbus work has got to go somewhere. And just kind of curious what kind of appetite you guys might all have for taking on some of that work, all in the context of your M&A strategy. Thanks. Yeah. No. Thanks, Jason. Good to be with you. Let me first just on our Vision 2027 and the acquisition piece. We have a placeholder for $75 million, right? So we're a bit modest on that because, obviously, it's only 2024. We got several years ahead of us. So we feel good about that. Again, it's a bit modest. But right now, as we move forward in time, we've really been happy with what we're doing on acquisitions. I think it's been a real great thing for shareholders and for the company. But we're looking more where we can do some maybe look at acquisitions where they can, again, help our current Engineered Products portfolio. We're committed to that, to build the business on that side. I think that's smart, and it's a winning formula for shareholders. I think 75, again, is low. I think we're going to do more bolt-ons. But again, if we can find something where there can be some consolidation, we're going to do that as well. So I think for the next couple of years, that's sort of where we sit. As far as Spirit, just to let you know, for Airbus, we ship directly into Toulouse for A320. So we're really just working with them directly. We don't really do anything for Airbus, for Spirit. Spirit's much more, I think, in the A350 world, which we're not right now. So we'd be open to it. I mean, I think it's as I read the notes this morning on some of the situations in the meeting in New York last night, it's going to be difficult. But we're there. I mean, we have the capacity. That could be an upside for us. I have nothing to report on it, but we certainly think we could help out. Airbus, again, for all the business we do right now as a first tier, we do everything with Toulouse direct. Okay. Great. So the $75 million placeholder looks like that through the 2027 timeframe, you think is going to be pretty achievable. I'm just kind of curious, though. What does the pipeline look like today? What do you think the cadence or potential timing of those acquisitions might be? Is this going to be nearer term, more back-end weighted towards 2027, and just kind of what the competitive environment looks like and pricing on the kinds of assets that you might be chasing? Let me jump in and Suman, I can say a few things, okay? So we're always in the market. So I'll just say that, all right? So we're always looking at things. We have, I think, an excellent team here led by Suman on M&A. If something comes up this year, we're going to do it. Our cadence has obviously slowed down through COVID for everybody, but we'd like to do at least one, if not two, a year. Again, this year, we just did BLR back in last May or last April and May. So we have a little bit of time now. So we're always in the market. It's competitive. I mean, I know you follow the companies, many of them, and it's a crowded lobby. But I will tell you that for what we want and what we've done, I mean, we've got a really good hit rate. We've had a lot of success for the things we've gone after, not every single one, but it's up there. So we're excited about building that part of the business. It's a big thing for me when I came in in 2017. And so I'll let Suman. Do you want to say anything else on it, or? Yeah. No. We've been actively looking at businesses. I would say there has been a pickup in deal flow in late Q1 and coming into Q2. We're seeing more assets come to market. Competitive environment, I wouldn't say necessarily has dramatically changed. The company you referenced that went public recently has been around and looking for similar assets for over 10 years. So we've certainly come across them in the past. So I don't see that dynamic changing now. So we will continue to be aggressive for businesses that we really like and where we really think we can drive a lot of incremental value for our shareholders. So we will continue to be aggressive with those opportunities. And as we have demonstrated in the past five years, we can, despite the competitive environment, win assets at a price at which we can still drive additional benefit and ROI for our shareholders. So we feel good about being able to continue doing that. And timing, as Steve said, is difficult to predict. It's active work ongoing on several opportunities, but timing always difficult to predict on M&A. All right. Yeah. And Jason, just to chime in there, we're also very excited about organic growth, okay? We really want to get, hopefully, the MAX will find its way by the end of the year. I mean, if they're at 50 at some point in the future, a drop through and everything else where we feel very good about our current operation too delivering. Okay. Great. That's wonderful. Appreciate the time. Thank you, Jason. Always appreciate you calling in. Thank you. I'm showing no further questions at this time. I'll now like to turn it back to Stephen Oswald for closing remarks. Okay. Thank you very much, and thanks for joining us today. Obviously, we couldn't be happier with our Q1. I want to thank my team, all the people working hard every day to come in and with our relentless approach to things. That's what we do here. And we are very encouraged as we come out of March to have, I think, a super year for everybody, for our shareholders and for our company and for all the other stakeholders involved with us. So again, thanks for joining us. Have a great and safe day. Thank you. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.