Hello, everyone. Good morning. Welcome to TransDigm's 2024 Analyst Day. Thank you for joining us. We're very excited to have you all here. We have a great agenda planned for today. We're going to start off with the management presentations. Then we're going to have an Operating Unit Trade Show breakout group. Just to flag to you, on your name tag, your group is noted so that you know where you need to go for the trade show group later. We'll explain more later, but just to flag that to you. We'll have lunch after the trade show, and there will be a Q&A panel to wrap up the day. Before we kick off the presentations, I have a few housekeeping items. First, I think most of you know the slide deck. It's on the website. So if you want to pull it down, it's under the Investor Relations presentation section. You all have the Wi-Fi on a card at your table if you need it. And then next, I have to read some forward-looking statements. So please bear with me, but we need to say it. So additionally, before we begin, the company would like to remind you that statements made during the presentation today, which are not historical in fact, are forward-looking statements. For further information about important factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, please refer to the company's latest filings with the SEC available through the investor section of our website or at SEC.gov. The company would also like to advise you that during the course of the presentations today, we will be referring to EBITDA, specifically EBITDA as defined, EBITDA as defined margin, adjusted net income, adjusted earnings per share, and free cash flow, all of which are non-GAAP financial measures. Please see the appendix in the 2024 Analyst Day slide deck for a presentation of the most directly comparable GAAP measures and applicable reconciliations. Now, to kick off today's events, go through that. We have a video before we'll have a video to kick off. And then Nick, who is our co-founder, our CEO and chairman, he'll be coming up. But first, we'll show the video, and that will kick off the day. Good morning, everybody. Thanks for coming to the 2024 Investment Day. It's been a while. I think I know many of you, but for those who don't, my name is Nick Howley. I'm one of the founders of the company and currently the chairman. I was CEO for much of the lifetime of the business up until the last about four years. Kevin has pulled me out of the bullpen. I was deep in the bullpen. Even though the fastball slowed down a bit, he's told me, "Can I just get, can I get half an inning? Can I get one batter out at least?" Apparently, the starting team needs some time yet to warm up or sober up. That wasn't quite clear to me. But anyway, that's my goal. I got to get a batter out. But anyway, in any event, I always like to talk about TransDigm's unique strategy. Let's see if I can get the slides right. That one. There you go. There you go. This is a graph of TransDigm's performance over the 18 years as a public company on the New York Stock Exchange. I'd say it's almost unmatched. An investment in TransDigm at the time of the IPO in 2006 is up 154 times or about a 32% IRR. That's compared to the S&P that's up about 6x over that period or 9%-10% IRR. This is through some bumpy times and frankly, some well-managed management changes through the years. The most recent bump, or should I say tidal wave in the road, was the COVID situation. Kevin, the team, had to deal with this relatively early in their tenure and frankly did an outstanding job, in my view. What accounts for this? I think it's a uniquely consistent strategy and value-focused culture combined with a continual focus on succession planning. This only works if you can keep a stream of people going who buy into this value creation philosophy and methodology. I'd ask you to see today, I don't know how many of you were here five years ago the last time we did this, take account today, see how many people are the same people that were here five years ago. And I think you're going to see it, not that many, but the performance and the culture still continued. That doesn't happen by happenstance. That's a lot of work. If you look at, interestingly, over a longer period of time, this is the 30- or 31-year history of the company. An interesting fact is the IRR of 30, mid-30% IRR has been almost the same in the private world as it's been in the public world over an amazing length of time and consistency of 30-something years. This is through cycles in the aerospace market, through cycles in the capital market, through the 9/11, through the Great Financial Crisis, through a miserable short attack in the 2016-2017 period, through COVID and changes in the key management. But we've stuck to our fundamental strategy, and this has served us and our investors well through the years. Kevin and his team have done an outstanding job of continuing this. No one knows the future, but I think they're about as ready as you can be to deal with whatever bumps come up along the road. A couple of things. Let's see this. Did I forget to change that slide last time? I probably did. Anyway, let's see if I got the right one here. A couple of things I think are worth pointing out. We have a very significant sort of value generation process, which we're going to spend a lot of time on. So I won't take too much time here. But a few things that I think are particularly interesting is our decentralized concept. If you look at the corporate level, a business for TransDigm has very substantial, unusually broad operating autonomy. There's no corporate vice presidents or marketing, engineering, things like that to second-guess them when they're running their businesses. There's a few things they have little, if any, latitude in. They're going to have a plan around what we call our three value drivers, which you'll hear a lot about. Exactly how they get there is up to them, but they're going to have a plan and a trackable plan. They're going to be in the proprietary aerospace business or the aftermarket, and they're going to have a fairly simple product-based organization structure where responsibility is very clear and simple, and there's plenty of transparency into performance. If you look at the operating unit, there's a few distinguishing characteristics in our operating unit. One, they often tend to be smaller than some might think appropriate. We may give up on some apparent economies of scale in some view, but I think we more than gain in focus and sort of overall value creation and intimate knowledge of the business. I think our history would bear that out. In the area of execution, we're way on the side of local autonomy. We try our best to minimize the corporate bureaucracy. The job of a president and his team here is to generate value. We don't want them wasting a lot of time on ass covering, working the corporate office, etc., etc. We want them creating value. And on motivation, if you look at sort of a spectrum from an employee to an owner, the people that succeed here are those that can think like owners and create value in their businesses. The stock options and the ownership position for the key people are significant here. This type of decentralized structure doesn't work without open and honest communication back and forth. A politician doesn't fit in here very well. Another somewhat unique aspect is the compensation system. Again, we are trying to get people to think and act like owners. The compensation system is set up that way. The key management at the corporate office and the operating units that we think can significantly impact value are in this system. We essentially tend to underpay in cash comp and over-equitize with options generally. The management is one of the largest owners of the company on a fully diluted basis. These options vest 100% on performance. As I like to say, there's no time, or as I like to call it, pulse vesting. You don't get them just by staying alive. I think this is a unique alignment with public shareholders that I don't know of any other public companies that operate this way. The operating management thinks and acts like owners because they are owners. Typically, this is far and away the largest investment they have. Now, our goal also has been very consistent. Our goal over the history of the company has been to get PE-like returns with the liquidity of a public market. We have consistently focused on these same five elements: proprietary aerospace with the aftermarket, a simple value-based operating strategy, as I say again, you're going to hear a lot about, so I won't expand it, a highly decentralized operating model and organization that is uniquely aligned with shareholders, a very disciplined acquisition strategy that's focused on value creation and nothing else, and an efficient capital structure, which we view as a key part of our value creation. Year in, year out, we stick to our knitting. This has made good money for the management and good money for all you investors over the past 30 years. I expect it will continue to do so in the future. Let me introduce Kevin Stein, the CEO. Kevin does the heavy lifting now in the value creation and frankly has done an outstanding job, particularly through this COVID bump. Thanks, Nick. Welcome, everyone. It's great to have you all here today. There we go. It's great. We haven't had this in six years, I think, about. It was 2018, just as I was becoming CEO, that we had our last one. Yeah, we didn't have to pull Nick out of retirement very much. Nick is still very involved as Chairman, and I talk to him a couple of times a week, sometimes just about philosophy, but lots of times about business and what's happening. He's a constant source of motivation and information. Let me talk to you a little bit about the folks you're going to see here today, an exciting group with certainly a proven track record. So as we look at this, the executives you're going to hear from, Mike, Joel, Sarah, the EVPs, and Jessica or Jess, our General Counsel and Chief Compliance Officer, that upper group of folks there, they have over 200 years of TransDigm experience and greater than 15 years each of experience within TransDigm. It's a wonderful team, the best team I can imagine, the best team I've ever worked with in my career. But the feeder for the future are some of the folks you're going to hear from also in the road shows, our presidents, an unbelievable group of folks that will be the feeders for EVPs, COOs, and hopefully CEO in the future. So these are the folks you're going to hear from today. Obviously, very experienced with our leveraged capital structure. We do have a very deep bench, one that we are constantly grooming and looking to add to. We definitely have these shared values. We all think alike, and we do think as owners, as shareholders as we are. Management is a significant owner. It's actually number three. We're the third largest owner of TransDigm out there. We believe in it. We put our money where our mouth is, and we drive results that are aligned with what you, the shareholders, want from us. This has clearly paid off. The 10-year return TransDigm versus the S&P 500, another way to look at what Nick was just showing, five year return, one year, significantly outperforming the S&P 500. It's clearly working in the short and long term. How does it work? We'll get into that today. Why does it work? You'll see for that yourself. But our stated goal is to provide private equity-like returns and exposure for a shareholder with liquidity of a public market. We hope that we'll be able to generate upper quartile private equity-like returns in that 15%-20% per year, which has been a target we've been able to surpass significantly. You'll hear this later on today. Our options don't vest unless we hit that 17.5% return on an intrinsic value audited stock internal. This is the same methodology we've used since the very beginning when Nick and Doug founded the company. There are no changes to our philosophy, our strategy, and the way we approach the business. So what does that mean? What is TransDigm's consistent private equity-like goal? I have to walk over here to see better. So we're looking for proprietary aerospace products with significant aftermarket. That's the key to our business. We don't want to be me-too suppliers. We don't look at proprietary either as process proprietary. We're not interested in process complexity necessarily. We want to own the design. We want to have our name on the prints and the drawings. It's a TransDigm-owned whole on that airplane that we're fulfilling. That's what we're looking for. It's not just process. It's not competitive products. This is the key. I would submit that everyone in the aerospace industry who supplies to aftermarket and OEMs have these types of products in their portfolio, which are also their highest performing. We follow this three-part value-based operating strategy, decentralized organization aligned with our shareholders and compensated, as Nick was just talking about, this focused, disciplined acquisition strategy. You're going to hear from Blake about that today. You're also going to hear from Patrick, one of our EVPs, who will talk to you about integration. We don't integrate like many companies do, and it's important to note that. We want to drive a private equity-like capital structure and culture. We pay significant dividends irregularly, and we're clearly M&A-focused in what we're doing. You'll hear more about this as we unpack what is, I think, a unique but consistent business strategy. The short term, clearly, it has worked. You can see on the right-hand side of this chart our change in midpoint guidance. Sorry, I had to use midpoint because that's what we've communicated to versus fiscal year 2022, up 43% in revenue, importantly, up 53% in EBITDA, and our share price, which includes the dividend if you read the small print on the bottom, up 158% over the two years. Clearly, it's working in the short term as a company overview and at 52+% EBITDA as a percent of sales margin as defined, pretty amazing performance, clearly. It has worked for the long term. As you heard Nick discuss, a compounded annual growth rate of 18% on revenue and 21% on EBITDA. This has clearly worked through time and has translated to very strong stock performance. So what is the basis of really our business and our business model? It's we want to sell into the aftermarket. We want to find high IP products that people can't live without and that need to be overhauled, repaired, replaced, upgraded over time. So you see in the red here on the left-hand side of the chart on the X-axis, that's, you're going to see years and Y-axis profitability. So when you're in development, you're going to lose money. That's the red. You're not actually selling it. You're going to lose a little bit. We don't take money, generally speaking, from other OEMs or defense industry, generally speaking. So we develop it ourselves. Then the product goes into production, and you get a gradual learning curve ramp of profitability. And this is really where the volume takes off on products because the highest volume for a part is really when it's being sold into the OEM. Aftermarket is much lower volume, obviously, and very irregular. But the point is that OEM production may last 30, 40 years for a platform, but the life cycle of those planes are 20, 30 years. So this extends out 50, 60 years for a platform when you have designed in content. So it becomes this unbelievable annuity that you can keep pricing into the future, keep driving productivity, keep revising, updating, upgrading, and improving to continue to drive the profitability of your business into the future. So this is what we try to take advantage of or try to emphasize in our business. It's the almost razor razor blade model. The razors are given away to everyone at a very cheap price. And then when you buy the blades for that individual razor, they're very expensive, the razor razor blade model. Very common in industry. I mean, obviously, this is true in automotive as well. So how does this translate for us? Where have we elected to focus? We're about a 60-40, a little bit less on the defense side company. So 60% is commercial, split as aftermarket and OEM. And then the defense side, which we don't split out OEM and aftermarket on. But the bulk of our profitability as a business, again, from this razor razor blade model, comes from the aftermarket, comes from our ability to service the aftermarket. It's the beauty of that last slide. And this is where it translates as you're going to make more money if you focus on the aftermarket. We commonly find companies almost true across the board when we acquire them. They have not spent any time managing their aftermarket, paying attention to it, servicing it. They let other people do it. They let the OEMs at times steal their aftermarket. These are all opportunities for us to clean up a business and improve the profitability of an individual business. It's very common to see this. Our aftermarket OEM split for the whole company, we're about 60/40 aftermarket to OEM, which is pretty consistent. Right now, obviously, the OEM is struggling a bit more, and aftermarket is the strength of the day. But it's also being restricted because there's not enough planes flying right now to service demand. Again, consistent with our strategy is we don't want to be a me-too business. We're not here to make commodity products. Build-to-print is a common term you'll hear in the aerospace world. And that is an opportunity for you to have process proprietary knowledge, but you don't own the drawing. This is common in casting and forging industries where they build to print. They're given a drawing and told to make this part. We don't like that, although it's better than a straight commodity because you don't own the drawing and someone can move it later on if they disagree with your pricing or other factors. So we strive to be as proprietary as possible, and we've consistently done this 90%+ proprietary products, consistent across. This is what gives us these strong, stable cash flows. How have we accomplished this? We've done this both organically by driving the profitability through productivity, winning new business, value pricing. But this has created the opportunity to go out and acquire and integrate businesses. I joined the company in 2014 in the middle. So I've been here for about 10 years now. Became CEO in 2018. I don't think we've lost any momentum as we've gone. This has been an incredible year for us. We've acquired 92 businesses from 1993 and 77 since its IPO. These are major businesses. Don't include the myriad of product lines that we acquire. But 2024 will be our second best M&A year on record where we will have acquired the second most EBITDA and spent the second most on record, behind only the year when we did the Esterline acquisition, which was very large. So the model continues. We continue to follow our disciplined acquisition strategy. We're not trying to grow bigger, faster than anyone else. We're trying to grow with quality businesses that meet our disciplined approach. Not every business is meant for us. We say no to 10x more businesses than we say yes to. We'll pay up for businesses that meet our criteria. So I'm not worried about competition in the world beating us out. When you find things that match your criteria, they will pay back eventually. So this has been a good year. We've acquired the GKN business that we'll call FPT Industries, SEI, which you'll see some of the new products back there that will be part of Calspan, the Bambi Bucket. There's actually a model of it there. It's really cool. And then lastly, Electron Devices, the vacuum tube, high power supply, radar-specific products. Very exciting business. This does not include Raptor. And the year is only about half over. So we still have more to go and more to do. And it's a very busy time in M&A. And you'll hear about that later when Blake goes through it. One of the things that I'm somewhat disappointed about is our leverage. Our leverage has fallen. This is you can see that on the far right. Not to an unprecedented level that we've never seen before, but rather to the low point of the last few years. This is something we need to continue to address. In this market, it's difficult to lever up and pay out without acquiring EBITDA. So we just have to be patient and address this as we continue to acquire businesses, much like we did with CPI where we upsized. And I'm sure you'll all ask me about dividends. So I'll leave that to when you ask me later. But it is on our minds as well. So Nick hit this slide. I hit it again because I believe in it. It's our consistent strategy that works for us. Proprietary aerospace with aftermarket content. Those are the things we're looking for. We're not trying to be the biggest supplier, employ hundreds of thousands of people. We want to be the highest value supplier in high-engineered proprietary products. We have a value-based operating strategy. We keep it simple. They own it in the field. We ask for the three Ps, profitable new business, productivity, and value pricing. It's very simple. We have this decentralized organization that I think is significantly aligned with shareholders. We all speak the same language. Test us today as you go around and talk to folks. We have this incredibly disciplined acquisition strategy. We're looking for one thing. And when we find it, it makes sense to us. We have the same criteria we always have. We have to surpass a conservative 20% IRR on every acquisition we make. And we have not deviated from that. And then we hope we have this efficient capital structure that allows us to quickly get money back to our shareholders. We last paid a special in November last year. Within this fiscal year. We recognize we have a lot of cash. We will have to deal with that in the future. I want to stress that one of the things that keeps this model moving, and you'll hear about this today, is the investment that we also do in our businesses. None of our businesses are starved for capital. However, every business we acquire is dramatically starved for capital, especially the PE ones. This is a great opportunity for us when we have cash to invest, grow, and expand businesses and make them even more vital to the marketplace. With that, I will turn it over to Mike, who is our Co-COO, who was the CFO before. Again, succession planning is such a vital part of our business. Morning, everyone. Thanks, Kevin. Mike Lisman, Co-COO, together with Joel Reiss, the two of us jointly oversee our 50 operating units. I'm going to take about 20 minutes to talk a little bit more about our business setup, how we're structured organizationally, our end markets, and then also the unique value proposition that we think we bring to our end customers. Org chart. So Kevin is the CEO, obviously, and then he has four direct reports. Joel and I both report directly into him, as does Jess Warren, General Counsel, and Sarah Wynne, our CFO. We've got now at the corporate office, and we're headquartered in Cleveland, slightly more than 50 heads. I think our last investor day, we were somewhere in the mid-30s. The vast majority of those folks are there primarily because we're a public company and you need a certain amount of infrastructure to support that. So think accountants and financial oversight of our operating units, a certain number of lawyers who help us with the public company filings, and then a compliance group. The vast majority of the folks at corporate, though, aren't interacting with the op units on a day-to-day basis. That responsibility is basically limited to the executive vice presidents, who we have six of them here scattered throughout the audience. That is a bench of folks. It's a big job at TransDigm. If you're an EVP at TransDigm, you're overseeing probably six to eight operating units. You got $600 million of EBITDA under you at our current multiple. So that's something like over $12 billion of enterprise value. And you're the primary pipe into the op units. We don't do EVPs of sales. We don't do EVPs of engineering or EVPs of operations or Lean Six Sigma. Our EVPs are folks who oversee our op units, and they handle all of that. They're homegrown. Across the six EVPs we have here today, the average tenure is something like 20 or 21 years. And they've all been presidents of at least one TransDigm operating unit and in a couple of instances, several more than that. So good homegrown bench who gets our culture. And this model is scalable. So as we add op units, it's pretty simple. You just add an EVP. And I think we've ticked up about, I think, by one or two EVPs since the last investor day six years ago. We've added a bunch of operating units, as you guys know, since then. So it continues to be scalable. Our product: seals, pumps, valves, seat belts. You guys have seen them before, and I think you'll see a couple in the breakout sessions in the corners and then downstairs too. It looks like a hodgepodge. It's not a hodgepodge. I can assure you the unifying criteria, the common thread, and all this stuff is, Kevin and Nick said, it is aerospace stuff. It's highly engineered proprietary content that our engineers design. It's not someone else's design. It's ours. We own it. And there's significant aftermarket content. So it breaks and drives that. And you benefit from the stability that comes with that across a big installed base. It's product that's designed in usually when an aircraft is qualified, and it's not easy to replace. And you'll see some of this and get more details on it from our presidents in those breakout sessions. Where are we? We're a global business. Our primary location of our 50 operating units is in the U.S. 40 of them are in the U.S. We've got two in Canada and eight in Europe now across U.K., Germany, and France. It's a pretty broad mix, obviously, across the group. If you pick a typical op unit, in the vast, vast majority of instances, that op unit is serving the commercial and the defense markets, given the nature of our product. It's obviously weighted more towards the commercial side, as you can tell and figure out from the revenue splits before. They're good and growing end markets across the group on both the commercial side and defense side of the house with a good outlook these next several years. We'll get into this in a bit more detail. Why is that the case? Why are they good growing markets? We'll start with commercial aftermarket. This is our most profitable end market. Why is it a good market? The worldwide installed base today, it's about 27,000 aircraft globally, commercial aircraft. That grows at something like a 3% clip, 4% clip, depending on whose forecast you buy. We knocked it down to 3% depending on how you round. It's going to be something like 4% as you look out the next five years through 2029. That's good solid growth. It It drives our commercial aftermarket. Similar story in the bottom chart, which is just worldwide RPK growth. This is an RPK is a butt in a seat going a kilometer. It's a gauge for airline activity. I think most of you guys know that. It's a good indicator for our commercial aftermarket demand. We've had a good bounce back coming out of COVID. The green trend line here, what I'm trying to show is that's where we would have been had COVID not happened. That's the trend line pre-COVID. Most prior downturns, if you went back to like 9/11 or the global financial crisis, 2008, 2009, in the majority of instances, it was a slight dip. Then in a year or two, two and a half years, depending on which downturn you pick, we got back to that original trend line. COVID's obviously been a steeper cut. Time will tell how closely we get back to the green line. We'll see. Not quite there yet. We've given up a couple of years of growth. In 2024, we just get back to the 2019 traffic levels. That's finally been achieved recently. But a really solid outlook for growth here, +6.5% going ahead the next five years. That'll fuel and drive our commercial aftermarket. And again, time will tell how closely we get back to that trend line. But a really solid outlook on the commercial aftermarket side. Shift over to the OEM side of things. This was obviously in the news this week when Airbus updated some of their estimates. Historically, this has been a more cyclical part of our business. And it's why we like the aftermarket, which COVID aside has tended to be far more stable from a volume standpoint. The OEM world is in a bit of a rougher spot, not quite back to pre-COVID levels. The demand is there. You've all probably read the headlines. Depending on which aircraft platform you pick, it's something like three years, four years, seven years, eight years of backlog at Airbus and Boeing, which is the left side of this chart. Airlines want the aircraft, the bottlenecks, the supply chain. It's still not quite back to where it was pre-COVID. Problems on certain engine content, castings, electronics. We see that with some of our businesses. It's getting better, but it's not where it was back in 2018, 2019. There's still some wood to chop and work to do there. We'll see how long it takes. The candy cane coloring here that you see at the top of these green charts, that's intentionally there to basically be some hedge on our part. I think we've seen, obviously, some downside on the OEM side recently as they struggle with the supply chain challenges. We'll eventually come out of it, but it's probably going to take at least another 12 months or so. Time will tell exactly how long. We remain cautious there, which was why we're haircutting things a bit. We watch this very closely, the OEM ramp rates, primarily because it drives for Joel and I, as we look out across with the EVPs across our op units. It drives a lot of the labor need. The OEM production is the most labor-intensive part of an op unit's headcount structure. So you got to be mindful about how and when you add with training and ramp-up curves there. So you take these two things together, a really good growing, surging aftermarket demand, and then an OEM side of the house that's struggling to meet the airline demand with new aircraft going into service. What do you get? Not surprisingly, older planes have to fly longer. If you look at the fleet age of that 27,000 aircraft fleet, it's ticked up like a year and a half, rough justice. If you look at this line we got here, it's 14.2 years currently. If you look at the outlook for the next several years, it's going to stay something like this age level. It's just the math. With a 2.5% retirement rate, the demand from the airlines that's expected to come with the 6.5% at least RPK, RPM growth, and the forecasted production of the OEMs. That age is going to remain elevated. It provides a bit of a tailwind for us in the commercial aftermarket. Not a huge tailwind. We'd be very successful there regardless, just given good strong RPM growth that's forecasted and expected, but a bit of a tailwind. Defense. A good story as well. If you pick the U.S. defense budget and the president's five-year outlook, you'd see something like low single-digit% growth. When you include the supplemental spending these last couple of years, it's significantly higher. We're not showing that on here, but rough justice, if you factored it in, you'd see something like mid-single-digit percentage growth and 10% this year when you include the supplemental spend, mainly for Ukraine and Israel-Gaza conflicts. Quite a bit of growth there. This is hard to when we read the headlines about this authorized spend in The Wall Street Journal or whatever you read, it doesn't trickle through to us immediately. Most of the spend that gets approved takes a year, two years to trickle down to the supply base. We see that. There is some delay. The international defense spending, the right side of this chart, that's expected to be up more in response to the global conflict, something like mid-single-digit growth. If you look at our defense pie, the 38% that Kevin mentioned, of that 38%, it depends on the year, but roughly a quarter to a third of it goes to support international defense programs projects at countries outside the U.S. Commercial aftermarket, this is how we track it. And we do track this quite closely, obviously, given that it is our most profitable end market. We don't look at just one quarter. It can be lumpy, not quite as lumpy as the defense side of the house that we just covered in terms of awards and timing and when dollars come out of the government, but it can still be lumpy. So we look at commercial aftermarket growth on a rolling 12-month average basis to get rid of some of the noise that you see when you look at it on just a quarterly basis. That's what you see here. In the last five years, we've outperformed the peer group by a bit, a couple of percentage points. Don't know exactly why because we don't have great insight into their commercial aftermarket. Could be a bit based on platform exposure where we have content and they don't. Could be a bit on the price side as well. We don't know. It's hard to unpack, but outperforming nonetheless. We're pleased to see this result. We look forward to making it continue. We get questions a lot on how much more runway can there be for you guys? How big of a slice of the commercial aftermarket are you? Are you going to run out of M&A runway? Can you run out of organic growth runway? And the answer is no. We see plenty of runway. The leftmost chart here on your side basically shows airline OpEx. This is 2023 data, just under a trillion dollars, $855 billion. The biggest expense for them is fuel. Second is that other North Carolina blue color box at the top that you see. That's mostly the cost of airplane ownership, so lease costs if you're leasing your aircraft. That's a huge chunk of the fleet, close to half now globally, or the depreciation costs if you own them, and then labor and benefits to the pilots, crew, maintenance workers as well. Maintenance spend is actually about 14% of it, $122 billion. Of that, we cover just about half. That's the 47%. That's the relevant piece for us of that component-type spend that the airlines globally spend to keep their aircraft in the air. We're about 3% of it when you separate our commercial transport aftermarket out from the total commercial aftermarket commercial transport. So you exclude the biz jet. 3%, not significant, suggests there's good room to run both organically with the customers we got, op unit by op unit, but then also through buying other folks who are part of that 47% as they sell themselves in coming years. Blake will cover more on that. And then Patrick will talk about the integration in a couple of minutes. But good runway here. Diversification. We tend to look a lot like the market. So what do I mean by that? The fleet. Not surprising, given that we're 50 op units that each went about their own strategy, pursued their own customers, sort of the law of large numbers. There's a lot of concentration across a high number of SKUs, something like 600,000. Only about 15%-20% of our commercial aftermarket revenue comes from part numbers where there's more than $3 million of annual sales. So a really long tail of SKU counts that generate not a lot of revenue. We're a super high, when it comes to the aftermarket, very high mix, low volume operation across our 50 op units in total, but then most op units in themselves. Diversified across airlines as well. We go through distributors, but we also sell direct quite a bit to airlines. Distribution is about 25% of our commercial aftermarket sales on average, a bit less right now. And then a lot of it goes direct to the airlines with a lot of diversification by airline customer. So diversified by SKU, diversified by airline, diversified by platform. That's what you see here. Not surprisingly, not a ton of concentration. The two biggest runners for us, 737 and A320, and this includes both OEM and aftermarket. If you unpack that 27,000 commercial aircraft fleet, the majority of it is A320s and 737s. They do the bulk of the flying, the cycles, depending on what you pick. Those are the two most common platforms. So not surprising they're high for us. 777, 767, A350 on here as well. What's not on here that was on here pre-COVID, things like 747, A380. Those have gone away or dwindled in terms of the percentage of the installed base they used to comprise. And what you see here is obviously newer programs where we've won good content coming up and comprising more and more of our revenue. Defense side of the house, a lower percentage amongst the top five platforms. But if you looked at the installed base, it's a similar story. A lot of Black Hawks, a lot of F-16s, and then JSF big as well, given the OEM production ramp-up and that comprising a bulk of OEM fighter jet production right now. We get a lot of questions on PMAs. Given the nature of your highly engineered products, are you subject to threat and competition going after those product positions? And the answer is we watch this like crazy. We watch it like hell. And our op units monitor the FAA websites where these PMAs get announced, and they can track it to make sure it's not any more of a growing threat than it has been. But we pretty much index as a percentage of our commercial aftermarket percent spend to a little bit less than what the market does. It suggests not a huge threat. Why is that? PMA is a hard business. If you're going to go and try to PMA a pump or a valve or some highly engineered product of TransDigm, you're looking at a considerable upfront investment of dollars, time, and having to go find an airline partner. It's not an easy thing to do. Folks are successful with it, but it's tough work. Given what I mentioned on the prior slide in our SKU diversification, you got to have a good business case for it. We also get questions a lot on the surplus competition that we could see. So what's surplus? You got a 32-year-old 737. You're not going to invest money in it because it's kind of at the end of its useful life. You don't want to do the next overhaul, so you part it out. You don't just park it in the desert. It gets parted out. They rip things that can still be used off of it. The part-out shops do, and they sell those into the aftermarket. Generally, that's focused on engine content and avionics. That's like 80% of the value of what gets ripped off the aircraft and tried to get resold into the aftermarket. We don't see a ton of competition here, but just like the PMA side, we watch it like hell because we don't want the competition to bubble up. Why don't we see a lot? Most of our parts have a lower price point. Typically, when the part-out shops go and go after this stuff, they're going over the higher value things, going after the higher value things, $5,000, $10,000 of resale value into the aftermarket. We're a bit lower than that on average, $2,000, and more consumable parts in nature. So we index it quite a bit below what the surplus parts market comprises of the total commercial aftermarket, about half, as you can see here. Again, we watch this. The retirement rate's low currently. We don't get complacent. It could always bubble up. But given the nature of our parts and the price points we operate at, we haven't seen a ton of competition here, but we do actively monitor it. So a really positive market backdrop, as you guys saw for us, probably more positive than it was as of the last investor day across our three-end markets. How do we execute and take advantage of the strong market environment we're in? Same playbook we've had, right? We've got a model that works, a playbook that we've run for a while, and we're going to stick to that and hope to capitalize on the end market conditions. At TransDigm, as you guys know, there are only three ways to create value. You can focus on productivity, profitable new business, and value-based pricing. This is like religion here. We don't take this lightly. We hammer it into our folks. I think you guys will probably see this slide three times today. If you're in our op unit and you go through our training, you see it even more. If you went to one of our quarterly business unit reviews, which is when we get together, Joel and I and the EVPs and Kevin comes as well, and we grind them a little bit on their performance. But what we grind them on and what's in the slide deck we review is metrics focused on these three things. The three things are what they were six years ago at our last investor day. It's what they were 10 years ago, 20 years ago. That's what makes the model work. We don't change for change's sake and add some new efficiency program and then two years later add another one. Our folks have had this ground into them. If you're not going to focus on this stuff when you show up at the office on a day-to-day basis, don't show up. Go play golf, as we joke around with them, and come back the next day when your head's in the game and you're ready to focus on these three metrics. The reality is, if you don't get on board with this and you think this isn't the way to look at it, you're probably not going to be around for very long. We weed those folks out. We do not compromise on the culture and the value drivers being the best way to grow your revenue and your EBITDA. We've got a very disciplined program with our op units. They run on a decentralized basis, but as Kevin and Nick showed, we forced them to basically adhere to the value drivers. And provided you focus on that, corporate stays out of your way, and you get the chance to go and then grow your operating unit and your business unit. We subdivide each operating unit to something between two and three business units. And each business unit has a business unit manager or BUM, as we call it. I was a BUM at Aerofluid Products, which is just outside Cleveland, working and selling air and fuel valves. You get a lot of autonomy in the job. It's a good tool for us on the succession planning side. There's a critical focus at our op units on value creation. On the R&D side and product development side, we spend something like 8%-10% of our cost every year on product development. It's focused. We don't do moonshots, and we don't do any kind of build it and they will come strategy. It's customer-driven. So the sales folks go and the customers, we interact with them, and they tell us what they're looking for or what characteristics they want in a product, and we go and spend our time on that. We don't do moonshots, and we aren't wasteful with the spending, but we definitely want to be making it because it's what drives the volume growth and the organic growth that we need and want to see to keep this company growing. So what's that all mean for the end customer? What do they value the most, especially in this environment, these last two, three years with supply chains where they've been? They want high-quality parts delivered on time so that their planes are in the air and that we're not having to ground aircraft or have issues with production lines. We deliver that to them. We do it in a very decentralized way. If you're troubleshooting something or working with one of our op units on a piece of new business or sustaining business, you're not calling into Cleveland. You call into an operating unit, and you deal with a lean team that sits down the hallway and close to the action. The folks on the front lines, not a bureaucracy and corporate that then has to call down to the production facility. That's not the way we work. We're more nimble and more accessible. And we think the customers appreciate that, especially now. How do we know it all works? We track the shipset content like crazy. Shipset content. Dollars of parts that you get on aircraft. There's no phony baloney here. We don't game the pricing. We're pretty maniacal and crazy about how we run the math here to make sure we're growing. You want to basically see your shipset content tick up as a new aircraft program comes out. There's not a ton of new aircraft being introduced on the commercial side now, but 787, A350, both great programs for us up big time. Latest new platforms to come out. 777X, less of an increase, not quite the 35% or 45% bumps we saw in the prior two I mentioned. But what we're seeing there is there was really a modest design change, some re-engineering, and some other systems on the avionics side that changed over. And in those instances where there's a modest design change, there's been a modest content change for us. That's true not just on 777X, but it's also true on the NEO and the MAX, where we saw something similar about a flattish to slight growth on each of those programs versus their successive or their prior generations. Across the narrow bodies, really good shipset content gains for us, up in excess of 30% across that group as well. It's good to see. Defense, similar story. JSF up 20%, and the A400 and KC-46 were up about double. What's not on here? FLRA programs like the B-21. Good gains there as well, but it's hard to pin down right now exactly what's been confirmed and solidified on those programs given the early stages they're at and the fact that full-scale production hasn't started yet and won't for a couple more years, but good content wins expected nonetheless. So you wrap it all together, really good operational track record we've had that's driven the revenue and EBITDA growth that Kevin discussed on his slides. We look forward to keeping it going. Consistent value strategy. We're going to stick to those value drivers. It's unlikely they change anytime soon. It's worked in the past. And we look forward to capitalizing on the end market conditions, the positive ones we see currently, or as the last five years taught us with COVID, whatever those conditions end up being. You got a team of 275 option holders and folks across our op units here who are driven to execute and incentivized to execute. Hopefully, we're not disappointing anyone. One of the things we're not giving is a five-year outlook on some minute financial detail that tells you exactly where we think things are going. As a recovering builder of big Excel files that are supposed to forecast the financial future of companies, myself, I empathize with everybody's situation, but we can't predict the future better than anyone. But we can guarantee we got a strong team of folks who are battle-tested, especially after COVID, and incentivized to go out there and grind away and do everything we can to increase the value of this business. And we got really good end markets behind us, as we just saw, and expect to continue seeing these next couple of years. I'm going to kick it off and turn it over to Joel Reiss. Joel's a 25-year TransDigm veteran, been president of many of our op units, and he's going to walk you through in a bit more detail how we execute at the local level at an op unit. Good morning. Thanks, Mike, for the introduction. I'm Joel Reiss, co-COO along with Mike. And I'm going to be talking to you today about our overall management process and our long-standing approach to value creation. As Mike's already told you, our value drivers that we talk about are the same ones that were in place when I started back in 2000 when we were just four operating units and $150 million in revenue. You've seen this slide as well. Our TransDigm organization, a highly decentralized structure, corporate office around 50-some people. What you don't see on here that you'd see at lots of centralized businesses, you don't see a global senior vice president of continuous improvement or supply chain. You don't see a senior VP of strategy. Those things, if you have them at the corporate office, what happens next? Well, it's not just one person. Now they have to hire a team of people because, obviously, they have a job. They have to do a good job. So they come up with their own priorities. And what's the likely event that the priority at the corporate office is going to match the unique strategies of 50 operating units? It's not going to happen. So we made a conscious decision. This has been true since day one in our business. We're not going to do it. So instead, what we do is we replace that with an Executive Vice President whose basic job is to cover all of those issues with the operating unit, a single person. So I'll kind of go a little bit more detail into the EVP role, as we call it. They are truly the chief cultural officer for our company. They're the frontline person that deals with the operating unit on almost a weekly basis. The EVP talks to their president. I was talking on Zoom long before the COVID days of Zoom. When you see people that are 2,500 miles away or 4,000 doing over the phone, this isn't quite the same. And what are you doing on that call? You're following up on how are we doing for the quarter? How are we doing on some key new business program? What's the key risk issues you have? So you're having this regular dialogue. Why? If you have a regular dialogue when an issue comes up, they're going to raise their hand and say, "I have a problem." We're trying to make sure we have a strong relationship with our presidents. It's about a value driver emphasis. It's easy for businesses. As issues come up, you start focusing away. So what do our EVPs do in these conversations with the president? We keep coming back to the value drivers. Are we focusing on a new business? Are we doing the right things on productivity? Are we hitting our on-time delivery goals? The EVPs are also the key folks in the quarterly reviews, asking and challenging our business unit managers, our VPs of sales, about performance and what they're doing to improve. They're talking about talent because it's important that we continue to develop the talent within our organization. Why? Because we're going to keep buying companies. We're going to continue to need to have talented individuals to run our programs or run our companies. Our EVPs are reviewing the talent development progress that they make. They're looking at the individual development plans with our presidents for their key high-potential people. And last, they're involved in the acquisition process. They go on diligence visits with the M&A team. They review the model to make sure that this is something we can achieve. And most importantly, and Patrick is going to spend a lot of time talking about this, they do the integration. So when we buy a business, the EVP is the person who does all the training. They're the ones who teach the new president, the staff, the TransDigm culture. How do we think? There's a lot of training. It takes a lot of work every single time, but it is one of the most rewarding aspects of being an EVP. Our organizational philosophy, this too remains unchanged. Nick had his chart, and at the bottom, the three dials: structure, execution, and motivation. By design, we like small operating units rather than one big super site. We probably have multiple actuator businesses, multiple motor companies. We could, hey, look at the math. The economies of scale says it's better to put them all together into one big building. You only have one shipping department. You have fewer staffs. By design, we don't like that structure. We would rather have more focused management looking at a smaller group of niche products and a smaller group of customers because we think that model has enabled us to grow our business better than having some big super site. We expect that they're focused on the details of the products. They're focused on customers. There's not going to be a lot of management layers. When I was the president of Hartwell, there's not too many layers between the operator on the shop floor and me. Makes it easier to engage with folks on the shop floor when that happens. We are big believers in our business unit structure, a group of co-located people focused on, again, a narrow niche group of products. When it comes to execution, our presidents and their staff make the vast, vast majority of the business decisions. Why is that? Because they're the ones closest to whatever the problem is. They're going to know that customer better than we are. There's no possible way that Mike or I sitting thousands of miles away is going to be able to have all of those details. They're focused, as we've said before multiple times, around value creation. Nick and Kevin both talked about our compensation. Our folks are paid to think and act like owners, but they truly do think and act like owners. They're not just focused on what are we doing for this month's results. They're not just focused on the quarter. They're looking long-term. Right? If everything with compensation was bonus, you're just trying to figure out how to do good this year. But if your goal is, "I want this business to be good three years, five years, 10 years," that's a whole different thought process. Now I got to grow new business. I got to challenge productivity differently. That's the way we work to create value. Our operating unit structure. You'd see this at basically every one of TransDigm's 50 operating units, a president and four VPs, their leadership team: VP of Sales, VP of Ops, VP of Engineering, and VP of Finance. Below that, you have co-located business unit teams. Some of our sites have two, some three, some four. It really just depends on the variety of the products. The vast majority of the time, these are grouped by the types of products that we produce. There are some cases we do it by market. That's a little bit more atypical for us. So if you went into our business and you saw the business unit area, you're going to see the business unit manager who leads the team, a manufacturing manager, quality engineer, planning, purchasing, customer support, design engineering. Everyone is in the same room together. They probably have a meeting room. They've got a metrics board that they're talking about. And you'd see people all the time interacting with one another. In fact, when I would walk through the business unit team area as a president, and if I didn't see people talking, we have a problem. We intentionally have low cubicle height walls, few offices, because we're trying to get folks engaged with one another. If you go to any of TransDigm's operating units, you're not going to see the TransDigm logo on the outside of the building. You're not going to see it on anybody's business card. Instead, what are you going to see? You're going to see the well-known brand names that our customers have known our products by for 20 years, for 50 years, for 75 years. Our employees think of themselves not as TransDigm, but if I'm at Korry, they think of themselves as working for Korry. If you're at Kaufman, you think Kaufman. Today, we have 50 operating units with over 115 business units. And today, we've grown to over 16,000 employees. We make, across those 50 operating units, thousands of different products. I think the last time we did the math, we make something like 500,000 different part numbers. But we make thousands of different products. Every operating unit has their own unique business issues, business challenges, business situations that pop up. The common thread across every one of these businesses is a maniacal focus on these three things. Mike already made the comment, but it's something we talk about all the time. We tell people, "If you're not going to focus on one of these things, go home." Because if you're, as the leader of a business, not focused on these things, then what are you doing? You're causing your team to be focused on something else. That's not what we want. So it is absolutely critical. This is what we talk about every single day within our businesses. And by the way, sometimes I receive a question on it. There isn't one value driver. There's three. We pay a lot of attention to all three value drivers. So business units, they start on almost day one. When we purchase a business, it becomes part of the TransDigm family. One of the first things we do is we put business unit teams in place. As I said, it's typically a grouping of related products together. It's sales, ops, and engineering, quality, customer support, all working together. And they're focused, again, on a relatively small group of niche products. Our business unit manager, they are the ones who set the expectation. Why? Because they're the ones who have the most direct interaction with the customer. So if we're going to prioritize something, we should be prioritizing what we're doing based on what the customer wants. And what are they focusing in on? They're focusing in on growing profitable new business, driving productivity, and value-based pricing our product. They have a very standardized set of metrics. The same metrics that we review at our business unit meetings today, we reviewed 10 years ago. I have an old slide deck from like 2006, and I flipped through it, and I think there was like two new ones or something like that. Why? Because if we're going to focus on those three things, it doesn't change. Now, how you achieve it, how you improve it, those and some of the details certainly will. But these folks, they look at it on a regular basis. They report it in monthly reports. We talk about it at our quarterly and mid-year meetings. And they own the results. Our business unit manager at the business unit meetings, they present the P&L. Why? They have to own it. It's not that as many companies do, have a VP of Finance present the P&L. I know the VP of Finance can present a P&L, but we want the business unit manager standing up front and talking about it and being able to answer questions about what they're doing to improve it. New business. If you ultimately want to grow faster than your underlying market, there's only one way to do it. You have to develop more products. So that is the key to driving organic growth. And I'll say, we're not just looking to grow new business. Anybody can grow new business. Our goal is profitable new business. We're not looking just to fill out a product line. We're not looking to just pick up a customer we haven't had before. The foundational piece for us is we should be developing something unique to solve a customer's problem. Across our company, roughly 20% of our employees, or 20% of the 16,000 employees, are engineers. We love to design products. That's what we do. Our co-located cross-functional business unit teams, that's where they work together. That's the key. Quality, ops, engineering working together. Typically, the products we do are highly engineered. As Kevin said earlier, we're not looking to develop me-too products. If you want something that somebody else already makes, you probably go buy it from them. You're coming to us because you have a problem. That business unit team that's all co-located, what does that enable? Responsive development. That's a key. Customer has a problem. Waiting months to get a response isn't going to work. They want to know you can achieve and come up with a solution. So how do we do with on-time delivery and quality? If you don't have great on-time delivery and great quality, that customer's not going to give you a new opportunity. What are they going to tell you? Figure out how to ship what you already have. So that is the foundational piece for our business. If you don't have that, the rest of it doesn't matter. It doesn't matter how many engineers we have. It doesn't matter how good we think we can develop something. We've got to have fantastic on-time delivery for our customers. Because we are trying to solve a customer's problem, it really is about an engineer-to-engineer sale. So that means our design engineers visiting the customer's engineers and talking through the issues, going and visiting an airline and understanding where they're having a product problem. What improvement can we do? Can we change something to make it more reliable, easier to maintain? It's critical for us that we have a customer sponsor. That somebody at the customer who, when an issue comes up, is going to make sure that the speed bump is removed. Because during any new business development, issues are going to come up. Teams sometimes aren't talking well with one another. We're missing the point. So we need to have somebody at the customer who is going to stand up for us and make sure that we can get the right people in the room to do it. Highly engineered products. In many cases, right, it's a combination of different things we've done before. It may be a new technology. It may be a new process that we've come up with. Rapid prototyping is a critical aspect of it. Nowadays, technology has made that easier and easier, but it is an absolutely important aspect to be able to put a component in front of your customer and say, "This is what it's going to look like. This is how it functions." And what's great about our business unit teams, because they are given so much authority to make a decision, I've seen many cases when we're bidding on work. And we have the third-generation prototype, and our competitor is still trying to get approval to kick off the program. Having people close to the situation who can make a decision to say, "Yes, this is a good program," makes a big difference. We have dedicated business unit teams. You're not seeing an engineer who's on five different teams. Am I on this business unit team, or am I on this business unit team? Concurrent engineering for us is just simply the idea that we want to make sure that sales and engineering, quality, operations, and our customer, we work together the entire time. It's not just I finished the design and I hand it over to the manufacturing engineer and ask him to sign off on it. It's them working every single day together on the design. It's seeing somebody from our shop floor, an experienced stamping operator or a technician in the design area talking through why this is the right way to build the product. So the fact that we can do it doesn't mean we should do it. This is an absolutely critical piece to our new business, and it's modeling. We love data. So it's got to be a data-driven approach. First thing we got to do is we have to have realistic OEM build rates. We're typically pretty conservative. We hear an airline is going to, sorry, an OEM is going to make a certain number. Is that really realistic? Let's kind of challenge that. Our engineers, our operations folks, our supply chain folks work to do bottoms-up estimates. We got to be realistic around what it will really cost to develop and produce this product for many years. Then we're not going to just look at it from an OEM standpoint. We know we're going to do an investment. Kevin said before, "This is the vast majority of the time. This is our money." Are we only looking at the OEM? If you're only looking at the OEM side, you're going to set an unrealistic price point for the OEM, and you're not going to win. Instead, we have to look at the entire life of the product. Typically, for us, instead of looking out 30 years, we're looking out at five and 10-year increments and trying to figure out when we look at the OEM, the investment, and the aftermarket side, whether it's spares or repairs, as we look at the entire piece. The other thing that is so important for us, there is no must-win program. That is evil words within our company. Why is that? When you have a must-win program, what do you start to do? "Well, let's kind of reduce the cost a little bit. Maybe the OEM build rate goes up a little bit higher. I can make any model work." That's not what we want. We believe if we do a good job on this, the data is going to give us the answer. We take the emotion out of the decision, and we make a decision, "Is this a good program to go after?" We're willing to invest money. We invest in a lot of programs. As Mike talked about, 8%-10% of our money is spent on R&D. We like developing new products, but we'd like to make sure we make money on those products eventually. Productivity. We set an expectation for our operating units that they work to offset inflation. As everyone in this room knows, inflation is real, right? Our employees work hard. They expect and earn a pay raise every year. Our vendors would like to pass along their cost increases to us. Healthcare costs go up, utilities, you name it. Our goal is to work to offset that increase across the entire cost structure, not just an operations issue. You may have seen from our numbers around the number of people we've added, we've been able to grow post-COVID at a rate slower than our revenue has gone up. And how have we done that? I'd say we've made a really big push in the past couple of years on automation. This is a challenge in our kind of products, right? We are an extremely high-mix, low-volume manufacturer, which is typically the exact opposite of what you want for automation. But the good news is the cost of automation continues to come down. Our teams continue to find good and creative ways to do it. So I thought it'd be good for you to have a chance to kind of look inside some of our factories. So we're going to show you a brief video to highlight just some of the automation projects at those businesses. So a small sample of some of our sites and some of the projects that we've been working on. But when it comes to productivity, it isn't just about automation. We've kicked off our annual planning process that we do where we start thinking about our FY 2025. And so all of our teams are looking right now at productivity. When they present their plan in August, it's going to be a long list of detailed projects. There's going to be a name and a date and an amount for every one of those. We kind of summarize them on a chart similar to this that you see on the screen. But it'll be broken up into things like purchasing savings, insourcing work, labor, other spending reductions. You'll notice at the bottom, you can see what we talked about trying to target the inflationary number across the entire cost structure. So we show what that information is, and we're going to track that every single month. They're going to present on it at the quarterly business unit meetings and review it. The other thing we do is during the year, if we get an unexpected cost increase, something we had not anticipated, that gets added during those quarterly meetings. Why? Because you can't just be proud of yourself that you offset inflation. If you had an unexpected $500,000, million-dollar expense, you haven't achieved your number anymore. You have to put that in. So we try to make sure that we keep our teams focused on achieving truly projects that save real money. This is one of our metrics that we look at when we talk about productivity, sales per employee. The first thing is we look at it on a price-adjusted basis. Otherwise, this is probably going to go up even if we didn't do anything about productivity. So if we're really becoming more productive over time, if we are truly doing real productivity projects that save real money, what's going to happen? Over time, we're going to see an improving trend on a constant dollar basis. It's things like automation. It's things like cross-functional training where we have folks who can do many, many tasks. So as the volume ramps up, somebody can handle multiple different things. And I think one of the key foundational pieces, one I remember being lectured on many, many years ago when I was the young director of ops, when I had a great long list of projects. And Nick Howley at the time said to me, "Joel, I don't like your list so much." Nick, we're like way ahead of what our number is. They're only operations projects. It is the key around our company that we don't just focus on direct labor. It's not just on material. We want to see projects from every single department. In our kind of industry, quality is a must. It starts with good process control, revision control, work instructions, the bills of material, which is kind of like the ingredients to the product. It's having formalized cross-training programs, employee certification programs. Our culture is critical. We have, and Nick and Kevin talked about this already. It's our open and honest communication. That is so critical, not just with an EVP and a president. It's not just president with the VPs. It's with everyone in the factory. We have to know that people are letting us know when an issue comes up. One of the great ways we do is a VIP program. We actually reward people for telling us there's a problem with the product. Is there a safety issue, a quality issue, an opportunity to save money on a product? It's an engaged management team. If our presidents, our VPs are not walking the shop floor, the office areas every day talking to our employees, we're doing something wrong. Folks only raise their hand when they're comfortable and they trust. And the best way to build trust? Constant engagement. That is a critical piece for us. There's metrics that we obviously have to track. It starts with customer quality and delivery ratings. If your customer thinks your quality isn't very good, it doesn't matter how good you think it is. Do you think your delivery is great and they don't? There's a problem. So it starts there. Obviously, internally, it's things like first pass yield and scrap. You got to track warranty returns on a brand new product. You shouldn't see this product coming back. If it is, we have an issue. We need to dig in. Verification. We do things like first article inspections and internal audits. Third-party audits are a must within the aerospace industry, like things like AS9100. The FAA and our customers come in routinely and audit our factories. But quality is an absolute key. On-time delivery. Things like repair turnaround time, lead time, responsiveness to a customer. That's operational excellence. They are foundational if you're going to win new business. I said that before. They're also foundational if you're going to charge a premium for your product. You have to have great quality and delivery if you're going to do that. This is a sample of one of our business unit charts. But our businesses, when they're thinking about pricing, they're trying to offset inflation each year. They're doing it on a part-by-part basis. Typically, on the OEM side, in many cases we have LTA, so you're not going to see the same level of increase. Aftermarket's a little bit different, a shorter cycle. But the key for us is we have to start with great performance. On-time delivery and quality is the most important thing we can do to support our ability to value-price our product. So if we've done the three value drivers, if we're really driving productivity, if we're really value-pricing our product, we're going to see it here in the income statement. And every quarter, our VP of sales stands up and they present the income statement for the whole business. Our business unit managers, as part of their section around talking about their business units, they present each of their own businesses. Because if two business unit teams are doing really well and one isn't, that's not what we're looking for. We call that chicken averaging. The expectation is every business unit team is performing. And what are we looking at? We expect our business unit managers and VPs of sales, they can talk to every number on the page. And if something is behind, why is it behind? What are we doing to make it better? And by the way, if you're underspending, why am I underspending? Underspending doesn't have to be good. There could be a problem. Maybe we're underspending engineering because we didn't want to program. What happened? So we're trying to make sure we are getting maximum results. We haven't changed our model. This has been consistent across the company for many, many years, and I don't see this changing. It starts with this value creation, folks, right? A constant focus on our value generation process. It's clear metrics. It's things like not changing the metrics. If you change the metrics every six months, that's confusing. You don't know where to focus again. So having that constant clear metrics is great. It's about accountability and responsibility. Our folks think and act like owners. They want to have a say. And if you do that time and time again, what are you going to get? You're going to get consistent value generation. So I want to talk a little bit of because one of the key things about growing value is you have to have the right people to do it. We're going to always have a fair amount of need for succession planning. Why? Over time, people retire. People move on. We continue to buy businesses. You'll hear more information around kind of the M&A process for us. But obviously, we've been successful for many years at acquiring businesses. And one of the things we love to be able to do when we buy a new business is you seed it with one or two TransDigm people from another company. Why? Because they get the culture. If I'm an EVP and I'm on the phone once a week or I'm visiting them a couple of days every other month in the early days, that's good. But if you have somebody who lived it every single day for years and they go to that business, it helps supercharge it. So those things require us to grow talent. So talent development. We have something like 15 internal training modules that we've developed over the years that cover things like financial knowledge, value creation strategy, contracting. These are things we teach at our business unit meetings. We teach our new acquisitions about it. We teach new hires. If you're going to be responsible for the income statement, you say, "Hey, I have full P&L responsibility," but you don't know the levers of how to make it better, you're not really P&L responsible. You're just presenting the P&L. Do you really understand new business? Can you put together that spreadsheet I showed before? Can you go through and understand how we're really going to drive productivity? Contracting, there's no senior vice president of contracting at the corporate office. Corporate office doesn't negotiate contracts. That's done at the operating unit. So a very important piece of that training. In contracting, contracting negotiations, making sure we're protecting ourselves with risk and make sure we own the intellectual property. We don't inadvertently give something away. We want to make sure we have access to the aftermarket. Those are all key. How do we evaluate the talent? We do it a number of ways. One, business unit reviews, right? We're at these quarterly meetings. We have a chance to see the VPs, the business unit managers present. Our EVPs do site visits periodically, do things like mid-year reviews where we get into a much greater level of detail around a smaller niche group of issues. Succession planning. This is a key for us. We develop folks internally. We start with somebody who is a sales engineer. They get promoted into a business unit manager. They become a VP of sales and eventually a president. The two most likely paths to president within TransDigm, VP of sales and VP of ops. Why is that? Well, typically, they're the ones who have the firsthand experience in executing the value drivers. We're going to be able to see a proven track record of results. Every one of our high-potential folks, we want them to have an individual development plan. They have a mentor within the business. We love things like stretch assignments. This is where somebody gets to do a job kind of outside of their normal experience. Right now, we have a VP of finance who's leading a factory move. That's about as far away from a typical VP of finance's capability. But the thing about all the great experiences they get working with contractors, working with the teams to finalize layouts, and job rotations. Maybe we have a VP of sales who has never worked in operations. So let's rotate them for one-two years with the VP of ops. Now we're going to have two people who have learned a lot about the other functions. That's going to put them in a spot to be much better at eventually leading a business as a president. A couple of leadership development programs. When we were here back in 2018, the last time we did this meeting, we had just kicked off this program. Now we've completed four rotations through. Four cohorts have gone through our executive development program. This is a customized curriculum that we come up with. We think these are the most important things that somebody as an up-and-coming leader at TransDigm should know. We partnered with the USC Marshall School. We basically work with the professors. We teach them about TransDigm, and they teach our students. These same folks, they go through action learning projects. They get an individual coach. They get a formal mentor of somebody who may be our COO, EVP, president of a different unit. And we've had a lot of success in this program, including the group that just finished a couple of months ago. We've already seen about a 50% promotion rate out of the folks going through this program. This year, Mike and I kicked off the business unit manager bootcamp. It's kind of a bit of a misnomer because bootcamp sounds like something you do for the new hires. Instead, we decided to take our business unit manager that had the most likelihood of being promoted in the next few years, and we put them through a two-day intensive training, highly participatory case studies of real TransDigm events, and we challenged them over two days. Why? Because we want them to be ready to be VPs of sales and VPs of ops and to be able to perform at a level faster than we would without the training. Our management development program. We're now in our sixth year of doing this program. We work to recruit smart and energetic MBA students who want to work for a manufacturing company. Not somebody who wants to work for a consulting company, not somebody who's looking to work for a high-tech company. We're looking for folks who want to work in manufacturing. These folks go through a two-year program. They do three rotations of eight months each. They go through things like being the junior business unit manager, a junior supply chain manager. They work as a manufacturing manager. And we get to evaluate them. Our businesses vie for the talent. They come up with, "This is the role I have," and they want to hire these folks when they're done. We also, this year or last year, kicked off what we call the JMO, which is a junior military officer program, which kind of looks very, very similar to this. We've just gotten our first folks graduating through that program this year. So how have we done our scorecard around talent and promotions? Since our last investor meeting, we've basically promoted into president roles, VP roles, and business unit managers. Roughly two-thirds of those folks are promoted from internal positions. When we hire from the outside, we got to bring talent in. But even when you bring them in, what are we trying to do? They're right into the pool of developing them so they can be promoted in the future. We're looking for people who are culture carriers, who love the TransDigm approach. Obviously, folks that are smart and energetic. We're looking for folks, though, not that they try really hard. Trying hard is important. We want to see a proven track record of success. If you're a business unit manager, are you leading your team for new business wins? Are you succeeding and hitting the projects on budget and meeting with the customers looking for? And last, are they leaders? The challenge is you don't want somebody who's just a great individual contributor. There's lots of great individual contributors. But if you're going to be a president, you're going to be one of our VPs. You're going to be an EVP someday. You have to be able to have real leadership. So in closing, since our founding, we've offered, we think, pretty solid performance stability. We're going to continue to do what we do. It starts with our consistent value creation strategy. It's our highly decentralized approach with business unit teams and people closest to the situation making the decision. And it's our constant need to add talent to the organization and develop the folks that we have. With that, I turn it over to Sarah Wynne, our Chief Financial Officer. Good morning. I'm Sarah Wynne, Chief Financial Officer. I'm going to go through a few slides here on financials. But you have seen the business model, the culture, the three value drivers. We love it. It's consistent and simple. Not necessarily easy done, but that's what makes TransDigm so successful. Kudos to both Kevin, Mike, Joel, the EVPs, and the operating units. They're the ones sweating the details, driving that performance year-over-year, and it translates right through into these financials, which makes this a joy to present this section. I will also touch on the capital allocation strategy. I think most of you are familiar with it, but it is a helpful reminder of how we think about that and it driving shareholder value. Then just a reminder, because I've got some 2024 forecast numbers in here, they are based on the midpoint of our guidance from Q2. We update our guidance quarterly. We'll be doing that coming up shortly in Q3, but for now, we're not confirming or updating them here. We'll do soon. Here's a look at our most recent five-year growth rates. Revenue. We're all aware revenue took a hit with COVID, but despite that, we came in 8% growth year-over-year for those five years. EBITDA. This is where you see our strategy at work. This is a great success story of how our teams responded to COVID. Despite that challenging time, in a very abrupt way, the quick and decisive but necessary actions that our teams took is evidenced here. Growing our EBITDA 11% CAGR over that time frame. In 2019, we'd acquired Esterline halfway through. And then in 2020, you've got the four-year impact of the Esterline acquisition. So we were also able to hold more or less our EBITDA margins flat during that time, even with those lower revenues. Likewise, our EPS grew as well, 12% CAGR, and then enterprise value more than doubling over that time frame. So how smooth was the last five years? Given the great success story of the EBITDA, I thought I'd go through this in just a little more detail. We started 2018 in great shape. 2019, we purchased Esterline. Great acquisition. And then 2020, COVID hit. And all the uncertainty around that, countries abruptly quickly shutting down. But that's when our teams grinded through that detail, cutting out those costs and spend that weren't necessary, fast and quickly, helping us hold those EBITDA margins. If I take a straight line from the 49.3 to the 51.6, that's where you get the 11%. Because obviously, slowly, the country started opening up. It didn't all open up as abruptly as it shut down, we now know. This is a testament, though, to everything that you have just heard from Nick, Kevin, Mike, and Joel on our structure and strategy. And what you're going to hear from Blake and Patrick on our M&A strategy and how we successfully integrate acquisitions into our business, even during a pandemic. So our EBITDA translates into significant free cash flow. Our goal is to convert 50% of our EBITDA into free cash flow. And we've pretty consistently hit it barring those few years of COVID. But as most of you know, during that time, within every one of those quarters, we were free cash flow positive, again, due to those quick, decisive actions that were taken early on. So after we've paid for our taxes and interest, what do we do with our cash? What do we do with this money? First, we reinvest it back into our op units. That's about 2%-3% of the revenue. Our operating units aren't very capital-intense, but we want to make sure that they've got the funding for the productivity projects that Joel mentioned earlier, the new business initiatives, as well as making sure their machinery and equipment and the building infrastructure are in good shape. After that, we'll do M&A, as you guys know. But if the pipeline isn't full and there aren't that many opportunities, then we'll deploy it to our shareholders, either in the form of buybacks or dividends. Our fourth choice, which we typically never do, is to pay down debt. But we do sometimes get asked this because we are highly levered. We have a unique capital structure. Because of our consistent and reliable high cash flow, we produce a lot of cash. It allows us to be highly levered, increase our shareholder value. We aim to be between 5-7x in that range. So this is more than the average public company in our peer group. Sometimes we bounce outside that, which you can see in the most recent quarter. But we've since deployed $1.5 billion of cash for acquisitions, primarily CPI. So it's a little higher than that now. But there's no change to our strategy. It's just timing here. The other reason we are very comfortable with this structure is how we manage our debt profile, which I'll touch on next. So we've been active. We've been busy this past year with the activity. I am not going to go through all this detail. We want to be opportunistic in the credit markets. And in summary, the punchline on this slide is that we ended up completing about $20 billion of financing activity in this past year. But this slide summarizes it better. At the bottom, you can see our current structure. We have a laser focus on managing our debt and our maturity stacks. We've pushed out those near-term maturity stacks, so we've got plenty of white space in front of us. And this is an important point for us. This is how we protect our business from any adverse shocks in the short term. It allows us to be highly levered. We basically have the guardrails in place to protect and maintain our debt strategy. During the year, we also reduced our interest expense rate down to 6%. 75% of our debt is fixed. That's through notes and hedges. That's another protection. It helps reduce the risk of any volatility on our interest rates, at least in the short term. Here's the detail of our debt structure. I won't go through all this detail either, but the top part, I'll speak to the dry powder. We've got the cash. We've since deployed $1.5 billion for those acquisitions, but still got plenty of dry powder to support initiatives, along with the $900 untapped revolver that you see there at the top. So once you add the capital leverage, along with the operational performance that Mike and Joel just walked you through, what do you get? You get superior results. We have substantially outperformed the S&P for an extended period of time, both five years and 10 years, and then this year in great shape. So having stress-tested our business model during one of the most abrupt disruptions to the aerospace business, we've come out stronger, and we look forward to many more profitable years ahead. With that, I'm going to hand it over to Blake, who's going to walk you through the M&A strategy. Good morning, everyone. I'm Blake Keller. I'm going to spend a little bit of time this morning talking through our M&A process. And then Patrick Murphy is going to come up here and talk a little bit about some of our recent acquisitions and some of the integration work. Not to be too repetitive, right? And I think we've hit on this a lot this morning because it's a common theme. But what we look for in acquiring businesses at TransDigm, we look for aerospace components, highly engineered proprietary components with significant aftermarket content, right? So the same criteria of our underlying businesses is what we look for today and what we're trying to acquire and what we will continue to look for into the future. This is unchanged from when Nick and Doug founded the company back in 1993, and it will remain unchanged into the future. Looking at our acquisition history, over the last ten years, we've averaged investing nearly $1.1 billion a year on M&A. Now, when you strip out Esterline, right, so the $4 billion acquisition we completed back in FY 2019, still $800 million a year in M&A. If you look at the momentum, though, recently in M&A, it's a good trend, right? So coming out of COVID, we had a little bit of a lull in COVID, but the last couple of years have seen a lot of strong M&A activity. FY 2024 includes our closed acquisition of CPI, the electronic device business. It includes SEI, the Bambi Bucket business that we're going to roll into DART. It includes the FPT Industries business that we acquired out of GKN. Good positive momentum across our M&A platform. As I look forward, we feel really good about the opportunities not only in front of us for the second half of this year, but also into next. There's a lot of strong momentum across our M&A platform today. Just a little bit on the M&A organization. We've got a really strong and experienced M&A team here at TransDigm, folks that are really good culture carriers for our business. Day to day, I run the team and report directly into Kevin. Just a little bit on myself. I've been at TransDigm for six years now. Of that six years, five have been doing M&A. And then I was actually a business unit manager myself, so the role that Joel spent some time describing with you all earlier today out at Aero Fluid Products, one of our biggest sites out in Painesville, Ohio. Otherwise, we've got three directors on the team who all report in through me. One individual kind of has a unique role. It's a former VP of sales at one of our largest organizations that we've brought into the M&A team to help us focus on stuff like commercial diligence, reviewing commercial contracts, stuff like that, right? Really focus on the commercial side of an acquisition. And then we've got two other folks on the team that just specialize in the day-to-day minutia of executing a transaction, right, and doing diligence, signing up a purchase agreement. And then finally, we've got a couple of brokers around the globe that also help us source deals, right? So one located in Europe, one located in the United States, and one based in Canada. So we commonly get asked the question, like, how is TransDigm generating leads across M&A? The truth is, our active pipeline is something that we really work hard at maintaining, and it's a deliberate process. Deals don't just come to us by chance. M&A doesn't happen just by luck, right? As our former EVP, Bernt Iversen, used to say, "M&A is a contact sport. You've got to get out. You've got to take the visits. You've got to go have the meetings. You've got to pound the pavement," so to speak. And then we closely report out all of our interactions on a quarterly basis to our board. They track us, and they hold us accountable if we're not doing that kind of stuff. Just a little bit on our active acquisition process. I think the key takeaway for here on these numbers, right, is our process is very deliberate, and it's not emotional. On the right side of this slide, what you'll see, these are typical M&A results for any given year. This isn't any particular year. What we've just done is, if you look back over a certain time period, this is kind of where the numbers shake out, right? So on any given year, we'd expect to look at almost 500 businesses. And from there, we'll kind of winnow down the funnel, right, to where you get to a point of evaluating 25 of them. And what evaluation means is we'll build a model. We'll do some diligence. We'll sit down with the C-suite, and we'll go through all of our diligence and our findings. And from there, we'll winnow it down even further, right, to the point of sending in about 10 letters of intent. Some of those are solicited. Some of those are unsolicited. From that point, you end up with closing, on average, one to three deals per year. Some years are higher, like this year. Some years are lower, like COVID. But you end up, on average, with one to three deals per year. But the point is, right, that we're very selective, and we're very deliberate, right, about how we're spending our time and our energy in this entire process. Everyone is involved. Another important point too here is that the 500 businesses that we talked about at the top of that funnel, just because we might have passed on them in the past, doesn't mean they might not be good businesses in the future, right? Sometimes they're too small, and sometimes we'll get another crack at that apple. And then the stats on the left side of this chart, what they are basically saying is, over the five-year time horizon of our LBO model that we're building, we expect to double EBITDA, right, or otherwise said, reduce our multiple by about half of what we spent on the upfront investment. So here's a couple of details just on the sources of our acquisitions. I think this is important for folks to understand. On the pie chart on the left, this is the number of businesses we've acquired since our IPO. The blue section of that pie chart is strategic sellers. Otherwise, said differently, we bought a business from a strategic seller. Gray section of that pie chart is a privately held business. Green section is a private equity-owned business. And what you see is a good mix, right? It's not like we're just acquiring businesses from strategics, or we're just acquiring businesses from private equity. We've got good relationships across that entire pie chart. It bears out in the results. What you see on the acquired EBITDA, that's the number of dollars that we've bought as part of the transaction. We tend to do bigger deals with private equity, which kind of makes sense, right? Private equity buyer is going to bolt on a couple more acquisitions. They're going to build up a platform, and then we've just acquired that platform, right? Over time, what's important for us, though, is having good relationships across all three aspects of these relationships. Kevin touched on this slide a bit at the outset, so I don't mean to belabor it too much, but it's something we're really proud of, right? Just 92 businesses acquired since 1993. That's just a lot of deals. 77 since 2006. This also doesn't include, right, just the myriad of small product lines that we've acquired at a number of our sites since that time as well. M&A really is the lifeblood of TransDigm. This is what we do. It's what we specialize in. I think if you ask folks across the industry that know us well and that know A&D really well, we have a really good reputation for being good buyers of businesses. I think that bears fruit in the results that you see here. We're known to be really straightforward. We're no-nonsense buyers. We say what we're going to go do, and then we go do it. There's a lot of folks - I'm not going to name any names, right? but that will retrade, right, or they'll change terms on folks to try and get cute at the end. That's not what we do at all. We're straightforward. We're honest. And it's a reputation that I hold dearly at TransDigm and will continue to maintain. So we've talked a bit about, in my introduction, about what we look for in acquisitions, but it's almost as important to understand, right, what we don't look for, right? You can see that in the green boxes here. Some stuff that bigger industrial companies might focus on, like synergies across their businesses or globalization or the need to diversify. It's not what we look for at all. That doesn't ever come up in our M&A evaluation. We at TransDigm think there has to be a very clear and simple path to value creation. That value creation is something that you can quantify in a spreadsheet, right? It's not some hand-waving argument around getting access to markets that we don't have access to today. I would challenge someone to try and quantify that, right? It's value creation that we can, at the end of the day, sit down and say, "This is the value that we're generating for our shareholders," right, the folks in the room today. It's our job to be very thoughtful and disciplined and focused in what we're doing. What do we look for, right? I think you guys have all heard this numerous times today, but we look for this, right? Creating shareholder value. That's the only answer when it comes to M&A and what we're looking for. It's not the hand-waving arguments that we talked about before. Our goal, just to reiterate it, is to deliver private equity-like returns with the liquidity of a public market. And that's what you see in the numbers here, right? Compounded annual sales, compounded annual EBITDA. The results bear out. So once we've confirmed that a company hits our investment criteria, how do we size up what we're willing to pay for that business? Well, the truth is, is that the M&A team sits down and builds a five year LBO. I'm not going to bore you all with the details of what a five year LBO is. I think you're all smart enough to understand that. But we typically will put on anywhere between 5-6x leverage. And then we sit down and we say, "What is the market for this business going to grow at? What productivity opportunities do we see for this business, right? And where's inflation going to be?" And then at the end, we rack it up and we say, "This has to generate at least a 20% IRR for our shareholders, the folks in the room." That's the threshold. A lot of times what we find is we tend to, in the M&A team, build conservative models, right? These acquisition models then become the baseline for judging our performance and reporting out to our board how each of the M&A acquisitions have done. Also, the key point here is that the model that I'm describing and the process that I'm describing is the same for every acquisition that we go through, right? So we talked about Calspan, right? That was a services company that we acquired. We talked about CPI. That's a components business that we acquired. We talked about pieces of DART, right, that we've acquired, SEI Industries and also FPT Industries. All of those acquisitions went through the exact same model, the exact same process. We don't bend the model. We don't try and make the model work. It's deliberate, and it's consistent. So once we're into diligence, right, we've gotten into diligence, we're learning more about a business, or even once we've acquired a business, what are some of the key areas of improvement that we look for? I'm not going to read through all of these examples, right, because I don't need to spend 20 minutes on each of these, but a couple of ones that I find interesting, right? Wasteful spending. And Joel highlighted this a bit on his presentation as well, right? Some companies in the A&D world will have kind of an "If you build it, they will come" approach with their R&D expenses, or they might not have a customer. They might not have a platform, and they might not even be tracking where the product's going from an R&D standpoint. We don't believe in any of that. We think that you have to have specific customers and specific sponsors for all of your R&D projects. Misunderstanding around the value of the products. This is a good one too. When we go and we acquire a company, we sit down and we say, "Give us your sales register. Give us all of your sales by each of your products, and then give us the margin that you make on all of those products." Sometimes it's surprising to see some of the companies look at the results. A lot of times what you find is maybe half of those sales are going through at a 50% gross margin for each of those products. And then you've got a whole host of other products, right, that might be sold at like a 0% gross margin. So when you average it, right, you got your 50s+ your zeros, you end up at 25. A lot of folks are happy with the 25. We're not, right? We go and have to have sometimes some difficult conversations with customers about those products that are being sold at 0%. 0% is not a good business. And then finally, a very common one that we like to spend time on, and I think it really came out in the video that you all saw earlier, was just the lack of capital, right? This is an easy one for us, but investing in things like automation, workplace safety, that's another one that we like to spend money on, right? Productivity projects, stuff to make the work environment safer, that's easy, right? That's low-hanging fruit for us. And places where we see high ROI on those types of investments, upfront. And those pay off pretty quick. So with that, I'm going to hand it over to Patrick Murphy to talk about some of our recent acquisitions and then also some of the integration work we've seen. All right. Good morning, everyone. My name is Patrick Murphy. I'm an EVP here at TransDigm. I'm going to talk to you about the acquisition integration process. So now that we own it, what do we do with it? As Blake talked about, we take businesses from the operating model that they're in today, and we move them to the TransDigm operating model to extract the value that might be pent up in there. We know, as Blake talked about, and as many of our other folks talked about here today, that these are good businesses fundamentally, right? They're focused on aerospace. They're proprietary products, processes, or technologies with significant aftermarket content. So it fits our model. That looks like everything else that we've acquired over the years. So we think we know how to extract value. And generally, these are good businesses that are maybe misunderstood or mismanaged. It's our job to find out a better way to maximize that unlocked value. So as EVPs, that's our role. Unlock shareholder value. We're good at the acquisition process. We're disciplined with our models and understanding. We close fast, and we get going. What does that get going look like? Well, all acquisitions are a little different. They're a little unique. Through the due diligence process, we're trying to understand those unique characteristics. We're trying to figure out where are the risks and where are the opportunities. A lot of that starts with the ownership. Blake talked about we buy from PE. We buy from strategics. We buy from private sellers. That gives us some insight, some clues into where they might have been mismanaged or overlooked aspects of the business that we can unlock, right? If you think about a private equity seller, right, they may have been squeezing it a little bit more, right? Not giving it the capital it needs, maybe not looking at some of the costs. Scenario we can go into. Look more deeply. Extract some value. How about if it's a public seller? Well, a public seller, a strategic, maybe it's just not a business that fit into their core. Maybe it was one that was just sort of set aside, not given a lot of attention, not given a lot of management. Another opportunity for us. How about a private seller? Well, private seller, sometimes these are just lifestyle businesses. Essentially, they're there to make a nice profit, but they're not looking to grow the business very much. Maybe the profitable new business side of it just hasn't been tended for a while. It's been overlooked. We're not talking to customers the way we should. Maybe we're not even delivering products the way we should. So we take all these pieces and we say, "Okay, we understand some of the risks. We understand some of the opportunities. Now we've got our value driver levers. We're trying to figure out how hard do we pull those levers and which lever applies to the acquisition we just bought." We're also looking at these businesses from the perspective of, is this a standalone business and it stood up as its own operating unit, or is this a tuck-in? We've got a couple that we're going to talk about in a few minutes that fit both criteria. And that's okay. Still good acquisitions. So now those levers, varying degrees of operational improvement are absolutely in front of us once we've done this assessment. Very early on through diligence and early on when we own it. Operations to supply chain. We're going to see that they had a lot of extra costs, a lot of things they're wasting money on. We can infuse some capital, help them there. Are they delivering on time? Do we need to focus on that very quickly? Get some metrics, better understanding in place. Contractual opportunities. Do they understand what their LTAs look like? Do they understand their go-to-market strategy? Is distribution a good model for this business? Are they giving away a lot of money in the channel that we could be keeping for ourselves, right? There's always value somewhere. And then the new business pipeline. Blake talked about it. Joel talked about it. We're rigorous in looking at, do these projects make sense? Is this a good investment? Is this where we need to be spending our money? Are we going to get the return on that new business project, or should we put our money and our resources elsewhere? Sometimes with a private seller, we find there are pet projects, things they like to work on, but really they don't fit the model of the business. There's no customer market for that. So we pull that lever hard. We dial in on the right new business projects. We move the team forward. No matter what, we've got a standard work. We've got a playbook that we use to extract this value. We're looking at infusing the culture, talking to them about the value drivers and our operating model. We want to make sure that they understand we're a decentralized operating model. That means you at the operating unit think and act like owners. We want to talk to them about the fact that we're detail-oriented. We talk in numbers, facts, and data, that we focus on the value, not the extraneous work that might be going on. We also talk to them about being a good supplier to our customers and being close to those customers. And then we work on the key personnel aspects of the business. So we're always evaluating during diligence and after diligence, early on when we own the business, do the people that are running the business today fit in our culture? Are they willing to get on board? And does it make sense to keep them or infuse some TransDigm talent into the business to maximize the business? We always want to control working capital and get that financial plan in place as quickly as we can. And again, this is a tried-and-true process. So there's significant commonality in the actions we take to integrate a business, move them to our operating model, our operating structure, our business unit-focused structure with the value drivers underlying. Okay. So now we kind of have the first phase. Then we go into actually making the acquisition happen. We've got a standard process and a timeline. This is kind of tried and true. We've done this 50+ times. We know how it works. We'll go ahead and execute it. As an EVP, you take a small team with you, maybe someone from M&A, finance, day one on site. Day one on site, introducing ourselves, talking to the team about the culture, explaining our operating model, decentralized, value-based, product-focused, customer-focused, and talking about our value drivers as a whole. So that's day one. Then we get them moving with some training. We secure the cash. We close the books, and we establish a financial plan. This is all happening over the first two weeks now. We're back there often in the first two weeks to have additional conversations about expectations, about training, about putting good, smart metrics in place. And then we establish this operational cadence of reviewing the business on a regular basis and ensuring we're moving towards the TransDigm operating model. We do this all in the first 30 days. That's a lot to do in 30 days. There's a lot going on here. It's also giving us an insight to the management team and how they react to that and giving them insight to our culture. We set high expectations. We move quickly. We have a bias for action, and we're a performance-based, performance-driven organization, right? They get that pretty quickly. Okay. So from there, after those first 30 days, we start moving to the next phase. We're deeply diving into the value drivers, explaining those, putting good metrics in place, and starting to pull on those value drivers to extract value from the company, right? To make them better than they were. So what does that mean? Well, we're going to start with productivity. As Blake mentioned, are they undercapitalized? Do we understand their expenses? We're going to go down through their cost list, every expense, and understand why are we spending this much? Does that make sense? Can you explain why it cost more this year than last year? Do you have a good supply chain strategy? Are you applying your resources appropriately? Are you efficient in the factory floor, right? So this is a good discussion. Looking for opportunities, building our productivity list. Pretty straightforward. We get into that quickly, first 60 days. We look at the contracts. We look at how do they understand their sales? Do they understand what goes to the OEM? Do they understand what goes to the aftermarket? Do they understand the replacement rate? Do they understand volumes? Where they're making money on certain sales, where they're not? We're also going to talk to them about their channel and some of their contracts, what their constraints are, right? We're going to walk through all of these details with them so we get a better understanding of the business. They get a better understanding of us. We can put in place actions and metrics to start moving this business towards our operating model, maximizing and extracting that value. Lastly, we start weeding and feeding the new business projects. Literally, we'll walk through every new business project that they have, how many resources, what's the funding. In some cases, we'll redo the model that Joel showed you to assess, does this still make sense to invest in? Or do we need to move resources to a different project, to a different spot, or off this project altogether and kill it? We'll do that, right? If it makes sense for the business, if this isn't the right project. All along, we're assessing personnel. Are these folks able to implement our operating model effectively? I would say about 50% of the time the answer is no, right? What we end up doing is we bring in TransDigm personnel, those folks who can augment the culture, driving the business forward, implementing our operating model, implementing the value drivers, and helping move the needle more quickly. That happens quite a bit. Okay. So now we're about 60 days in. All the while, we've controlled working capital. We've established that financial plan. We've also ensured that payroll is happening appropriately. That's day one, week one, very important benefits are in place so the people at the business know that we do really intend to improve this business and move it to the next level, lever, and that's a good thing for them too. Okay. So now we're probably 60 days in. We're talking about business units and business unit structure. That starts on day one. We carry it through the first 30 days. By day 30, 45, we're talking about business unit teams and business unit structure. We want to talk about this on an income statement basis. That's a key part of our culture. That focus at the next level, that absolute importance of the business unit manager and their role in the business. So business unit focus and business unit structure is the next thing that we implement. All the while, we're stabilizing HR, legal, accounting. We're doing the branding. And now we're starting to have a natural cadence of this business performing, reporting out, and operating in the TransDigm business model. How long does it take from there? Well, 180 days till we think we've kind of got some natural cycle going. And now we continue to monitor at a little different level. But that first 180 days, very intense. The EVP is spending a lot of time continuing to talk about culture, training, our operating model, setting expectations, and talking about the team about performance-based, value-driven results. So that being said, how have we done over the years? Let's take a look at some of the businesses we've acquired over the last six years or so and see how they're performing. All right. So CPI, I think you guys know about this one. CPI is the most recent acquisition we've had. CPI was purchased in June of 2024. I'm happy to be the EVP working to integrate this business as we speak. About a $1.4 billion purchase, a little under $300 million in revenue. We decided right away, Nick talked about this, I think early, that we split this into two operating units. We think that makes sense because we can focus this business more on what's happening at the two operating units than we would have if it was one large operating unit. Just a little too complex, just a little too many things going on, four sites across the U.S. and the U.K. Two operating units makes more sense. CPI, by the way, makes electronic component systems using generation of application of transmission and reception signals. Essentially, they're making things called klystrons. They're thinking vacuum electronic devices, magnetrons for focusing and amplifying power. That's what this business does. It's a great business. It's a lot of components. 75% of this is sold to defense markets, 25% to commercial, 70% of it aftermarket, right? It's a really solid business that's now going through the acquisition process, the integration process. We had 25%-30% EBITDA margin when we bought this. We think this is going to be a great business for us long term, and it's also going to drive private equity-like returns. No doubt in our minds right now. The next business, as we go back, is Calspan. Calspan was purchased in May of 2023. Here we opened our aperture a little bit, right? This isn't a products-based specific business, but more of a services-based business. This is wind tunnel and flight testing and jet engine test cells. That's what Calspan focuses on. The only independent hypersonic wind tunnel in North America. Ultrasonic, sorry, ultrasonic wind tunnel in North America. Purchased this for about $725 million. And you can see commercial aerospace focus, even though it's services, not products, still commercial aerospace focused. Defense about 35%, a little bit of automotive. They do some automotive testing, crash test dummy type testing there. That's a unique part of their business. But it's still a very sticky business. Similar to our aerospace components business, this services business looks a lot like what our components businesses look like. It fit our model very well, and it's turning out to be a great acquisition. So as of the acquisition date, about 25% EBITDA margins, and this is off and running. Paula Wheeler actually helped integrate this one. And we expect this to also yield private equity-like returns. So this has been a good one. Yes, we opened the aperture, and it's turned out to be a good decision. DART Aerospace is the next one I'll talk about quickly. DART was acquired in May of 2022. This business was probably a little different as well, right? Because it's solely focused on rotorcraft, on helicopters. DART, we purchased for $360 million. We bought this from a PE company. They had south of $90 million or about $90 million in revenue when we purchased this business. And at the acquisition date, they were running about 25% EBITDA margins. DART, interestingly, uses a combination of these highly engineered products and STC, supplemental type certified products, to establish itself with a fairly large aftermarket footprint. As you can see there, 80% of revenues driven by aftermarket. They make unique helicopter mission solutions. Think about things that go on a helicopter if you're going into different areas of the world, like skis on your landing gear or pads on their landing gear. They call them, I think, Yeti feet or something like that. They also have baskets, cable cutters, things that are perfect for a mission that they're suited for. Also float systems. Anytime a helicopter goes over water, they need float systems, emergency float systems, cargo expansion, and floatation devices across their portfolio. This has been a great business for TransDigm for a couple of reasons. One, they've already made significant progress towards the private equity-like returns over the roughly two years that we've purchased them. Two, they've proved to be an avenue to open up other smaller acquisitions, tuck-ins. And we really like what we're seeing from the Dart business. Here are some of those smaller acquisitions and tuck-ins. So earlier this year, in March of 2024, we purchased the GKN's FPT Industries. This is helicopter fuel and flotation systems. So again, similar to what Dart does, although very different aircraft and flexible fuel tanks that go onto these rotorcraft. We purchased this for about $55 million. Good portfolio of commercial, defense, with a number of, with a large percentage of this being aftermarket focus as well. This is one where we felt that GKN just didn't see where it fit into their business model any longer, and it really fits well into ours. Tucked it into Dart. The Dart team's helping with the acquisition integration now. This is located in the U.K., Portsmouth, U.K. Very, very recently, in May of 2024, we acquired another business that we tucked into Dart. So the Dart business is growing by leaps and bounds. It's a little bit of this interesting focus on rotorcraft, on helicopters. Purchase price here, about $170 million. We've purchased this from a private seller, a little different here. And so this is one, as we're looking at how to extract value, things like rationalizing new product development is going to be a big portion of it. They're working on some pretty interesting things. I happen to be on diligence for this one. And there's just things we had to say, I'm not sure that's core to your business any longer, but it's going to give us an opportunity. It's going to be great." EBITDA margin is about 40%. So they're doing quite well. We don't think they were looking at the business the way we do. They weren't looking at their cost structure. They weren't looking at their new business opportunities. And the channel we think can be optimized. So lots of great things we can do here. This is the Bambi Bucket. So this business, and that's a very well-known common name in the firefighting industry. So these buckets attach to the bottom of the helicopter, as you see here, and they're able to dump water in a controlled way on a specific area of fire if there's a forest fire. It's been around for many, many years, over 40 years, and it's got a great name in the industry. So this is a really exciting acquisition. And now it's given Dart this great portfolio that they can build off of. Going back a few more years before this, January of 2021, excuse me, we purchased the Cobham Aero Connectivity business for about $965 million with businesses located in the U.K. and in Arizona. We ended up splitting this business as well because of, in this case, the product sets were just different. This company makes highly engineered antennas and radios. The antenna business was in the U.K. The radio business was in Arizona. And it just made sense to split and focus this business as two separate operating units. About 75% of what this business makes goes to the defense market. About 25% goes to the commercial market. 70% aftermarket. Boy, this fits into our model quite well. Right now, as we acquired it, sorry, there was a 25% EBITDA margin profile. Right now, this is looking very good to us, very positive. That split has given us more focus. We think it's going to accelerate our private equity-like returns. These two businesses were bought during COVID, and it's kind of added a little bit of complexity to it. But boy, coming out of that timeframe, we've had a great boost here. Lastly, I'll go to the kind of granddaddy of them all, right? The Esterline acquisition. 2019, we purchased Esterline for $4 billion. I think we bought 20 operating units at the time. Today, we have 12 of those. Every now and again, as you guys know, when we purchase a large group of businesses like this, there are some that just don't fit our model. So we decided those that don't fit need to go. We're going to focus on these 12 businesses. That's been really good for us. This was a large acquisition. We had to do a couple of things differently, right? One, we divested some of these commodity non-aerospace type businesses to focus on the 12. But the other thing we did is because of the size and scope of this, we took two people out of core legacy TransDigm and focused them solely on the integration process. That was their job for, gosh, almost two years. Bob Anderson, Joel Reiss, and Pete Palmer did that. Everybody else picked up the slack on the other legacy businesses that were out there. This has been a really, really great acquisition for us, as you guys know. But it wasn't easy. Those guys had a very, very heavy lift. Not only that, about one year after we bought this team, COVID did hit. It just threw a wrench into the process. You're kind of resetting expectations while you're integrating 12 businesses across the world. What a phenomenal job that was done here. This is well outpacing our expectations with current margins in the high 30% range coming up above 15% EBITDA margin at the point of acquisition. This was a great buy for us, and it really kind of laid the groundwork for the next set of acquisitions and the integrations going forward. With that, I'll turn it back to Kevin for some wrap-up. Okay. We are a tad bit behind schedule, so we're going to do lunch and Q&A simultaneously. But let me wrap up the M&A piece. Here we are. This is an actual performance and example. Clearly, what we're doing works across the business. This is an actual example. Anyone guess what this one is? So the model we had is on the left, and we hoped to improve over five years to get our 20% IRR. Fortunately, we were able to hit that in year one of ownership. Five years later, wildly better. This is actually Esterline. A very successful acquisition for us. This doesn't look dissimilar to any other acquisition we do. Quite frankly, we have a habit of building pretty conservative models that we can beat. What have we done recently in M&A that I think is important is we've ever so slightly broadened the aperture to see if we can find additional spaces within aerospace and defense that will provide 20%+ IRR opportunities for us. You see the core here, aerospace and defense. You heard about this earlier, about a $120 billion market, of which we are $7 billion of it. It's a very small percentage. So that's the core components that we've always produced and sold into. What we've done recently is still within aerospace and defense, broaden things to look at specialty helicopter components, things that we wouldn't have been as interested in in the past for whatever reason. And also specialty aerospace and defense testing, instrumentation, and certification. We don't want to get into the MRO of testing so much. But the instrumentation technology, the actual equipment that also needs a ton of spare parts, and these types of certification and test equipment are actually linked to platforms, much like anything else we do. So here we're starting to find with Calspan and now with Raptor that there are additional places for us to acquire around. And this is what we're going to keep doing around aerospace and defense, is finding places so that we can put more of the cash to work. It's not that we're running out of ideas in core aerospace and defense. I think we're all just dissatisfied with how quickly we can find good deals that make sense for us, that match our discipline criteria. And if we can slightly broaden the aperture, not lose our religion here, but find some more opportunities, that will be good for us. Also, I think a number of you have pointed out to me the CPI acquisition also has some medical equipment as part of it. This will also give us a place to learn about some of this medical technology, which is also a field I think will produce in the future some pretty good returns. But we will stay focused on aerospace and defense and learn as we go and then figure out ways to slightly broaden the aperture so that we can put more capital at work. To me, a dividend is it's an okay thing, but on some level, it's a failure because we haven't identified enough deals. I would much rather spend the money on good, disciplined, accretive deals. So how do we get I think this is my last slide. How do we get to this 15%-20% per year return that we always talk about? Our options vest at 17.5%. This is the key. And all of this flows together. The fact that we're choosing highly engineered parts that have aftermarket means that your base business, you're going to grow 10%-11% on organic EBITDA growth in your base. This is the key. This is the core that makes this whole thing work. We don't have to do bigger and bigger acquisitions to make the model work because our core Aero Fluid Products, Aerocontrolex, they will find the same opportunities for productivity and value pricing and new business growth as businesses that have just joined us. The fact is that you can continue to drive performance in your base. And then you fold on top of that a few points of return from leverage and a few points of return from acquisition, and that's how you get to this upper quartile PE-like return. But acquisitions only having to add a few percentage points is a key point to remember. We do not have to do bigger and bigger acquisitions. What we're targeting is doing something around $7,500 million a year. It goes up slightly every year as you grow. But if you can do that year in and year out, that's all it takes to continue to drive this model of return. If in years like this year and back in the Esterline year, when you can acquire more than that, things that meet your discipline criteria, it will lead to outstanding performance in the years ahead. So this is how we do it. It's the same way we've done it since I came here, since Nick and Doug founded the company. And it's this balanced approach that the highly engineered proprietary products offer you that commodities and competitive parts don't. So we will now go into breakouts. So we'll do the breakout groups. And then to get you out on time, we'll do lunch and Q&A at the same time. I'm told lunch isn't probably going to be that fantastic, so you don't have to worry if you don't eat at all. So group A and B are up here. C and D are downstairs. The goal is to have you rotate through all four groups. They're about 20 minutes each. We'll move you through them quick. So take your break. Do the rotations. This is where you're going to be able to interact with presidents, EVPs, and all of us. Thank you. And we'll see you back for Q&A. Hello, everyone. Once again, I'm Jaimie Seaman. I'm the Director of Investor Relations. I really appreciate you guys coming today. I hope that you've really enjoyed the event so far. The last thing on the agenda for the day is our Q&A panel. For the panel today, we have our CEO, Kevin Stein, and our co-COOs, Mike Lisman and Joel Reiss, to take your questions. Myself and Susan and Jill, who are in the back of the room, each have a handheld mic that we are going to run to whoever is asking the question so that everyone can hear. Please only join the queue once and limit yourself to one question. Then when we take your question, please say your name and the firm you are with. All right. If you have a question, please raise your hand, and we'll start taking them. Yes, please.