P&F Industries (PFIN) 16 Nov 202020 Q3 Earnings call transcript

Good day and welcome to the P&F Industries, Inc. Q3 2020 Earnings Conference Call. Today’s conference is being recorded. [Operator Instructions] At this time, I would like to turn the conference over to Richard Goodman, the company’s General Counsel. Please go ahead, sir.

operator. you, Thank welcome call. and Industries’ quarter third Good to conference XXXX morning P&F With Horowitz, Officer are Chief management us from today Richard Officer. and Molino, Financial Executive Joseph Chairman, Chief Chief Operating and Officer and President

the from in behalf actual inventory or sourcing to, and under risks in statements and to Before attacks or current described importation we to that the filed future those with in regulatory risks risks businesses, patterns, our which by and quarterly retail the on fluctuations our States reports forward-looking statements to concentration, These forward-looking upon in information the others, expectations, results any acquisition by credit of most other and as our and outlook, related debt and company’s call company’s those system would plans, to outbreak exposure prices, discussed of other environment reports performance made on today’s with and those materially purchasing on risks future United management, from the by products, periods and acceptance remind energy cause including, of are not abroad, adjustments SEC, to company. performance market borrowing of on COVID-XX XX-Q and changes and facility, XX-K, you markets, described the for other the the goodwill, could subject statements expressed debt disruption and our associated of various with started, differ in capital including, get the uncertainties, and annual and I strength Form in any estimates service economy limited global like among our crises, including covenants and recent public delays, credit lived the report historical the on with Form are health company’s filings. in associated requirements, assets and the uncertainties impairment technology based overseas, global compliance unforeseen risks customer failures company but and

Forward-looking update now no revise date statements, result the which or and like on any turn of to with whether undertakes future would obligation to Horowitz. Richard the morning, And made of only speak to company publicly as developments statements forward-looking Richard. they information, as that, new or otherwise. call over the I Good a are

I by I to sheet affected difficult released would includes thank continuingly morning, release attention third like which balance statements like would company’s order press you. COVID-XX. of all times today, and XXXX, those our Good our life. to the items. morning, the this acknowledge that streamline circumstances health was of discussions and for challenging in like direct operations of earlier cash to thoughts all the of in of extraordinarily continues and I you everybody are well doing the terms and quarter would XXXX Rich hope to thank with be economy And results. you are to for Good all us and today joining under September I and XX, your results this flow two operations. related company’s note company’s to the and today, following In to the call statements

be to other with of and management time. done be that of the we Firstly, company’s lines pertinent open adhere be information aware that, summarizing management the this We directly go procedure questions prior company’s insist as years, section. question-and-answer this may earnings the move we answering be only will have the must call. that from Operator, quarter, to as secondly, entertaining may did for you any happy release, instead to the questions please the you to And this And will have. beyond at condition. results we of anybody any in operations last and directly not answer press scope for we we the questions will and relating will financial as results

Instructions] Shapiro with Andrew take [Operator will Capital our first We question you. Thank from Management. Lawndale

just from a more guys. morning queue or few in XX% seasonality demand incremental good product provide to rebound demand rebound noted a new this volume in from versus from had headwind that, I several of sequential or function a you questions. extra felt economic or of function to Hi, an particular, a either others ask for have out some you back will have other growth ask. than COVID-induced a the And into Florida catching sectors growth I I prior I Pneumatic, such greater momentum understand last sequential in I was that in three then growth was your to of just trying and to extent customers able the and wondering a nature of quarter. question? your what to is up. am quarter’s from if understand continuable, be results, slowdown that and sequential if you

Right.

We a is lucky customers also now and demand other cases, can an that in getting and outlet in some crystal orders I been move for down if it’s information an enormous pent-up this we orders a which it’s using like people tool We sense. think lot generally seasonal. large enormous to I for amount awful by and shutdown the I thing. don’t mostly think lot But for the of the the retail other things seasonal of intended been retail than in all spray use An we are COVID that economy has not of enough this happen mean, up. our and only had I and to anything understand demand we in has It’s in the increases for we not don’t get that question. are particular a relative direction. are catch There they we caveat the extremely purposes. of believe sector amount of if to is at breakout referring have of in even guns, product It’s know gets so that? enormous But we to from side, speaking, that that to, customers And that I obviously that. those – know because our encouraged antiseptic again now, add exactly. those ball. a hoping by know to of are Joe, business. we continue what again of and nobody are have seeing way, you breaks don’t in very that doesn’t want but now that we you an Yes. a honestly are not –

kind gone is thing entire that back any only seasonality decade. add would There business. reiterate seasonality to concept I of isn’t there would no The really just That the our I company has is a our now, business to anymore.

visibility for a spray of you the Okay. purposes, demand creating – for this percent? have that you And type have the you regarding gun and sense gun of the incremental sanitization are do into do spray particular industries are

We getting. been we That’s No, really get We orders don’t. are we’ve don’t. our weekly we them. just all getting and

of a I guess a sanitizing new gun? powered kind pneumatic is – for spray this And

Yes, absolutely.

use? trying just its is then around gun broad So itself get and the how to feel a spray travels that portable for

you when I on anything that, with light, chime people them. you it Joe, to not can to it’s want around portable. but definitely maybe carry but that? it’s Joe, add in portable mean it’s

couple wrench. is size a a of nearly certainly There might spray you to Yes. wrench, of The to gun need impact not a impact would sizable appropriately you factors. an need compressor is use what drive

issue. one that’s So,

holes. might itself compressor be pretty long the So, to you small second, on be wheels. And can have enough

just sure fair make because XX, big that’s If you going I to XX, amount pressure a talking difference. again you are not build XX up can and about spraying, am hose. a of XX, feet a

to less lot because is really it’s your are So fairly it answer pressure guess a require you of a than fairly – driving – quite I – required much will there it’s torque. a less something question lot portable, is

ahead. go Yes,

Depot for are Yes, part, the not at a being out. that, sometimes. a this places them do are most products they They mean these like they are even is sold they could – though and – not lot I Home remember, carrying ordering people

your do? otherwise this the rather bulk than that So work of is you catalog Depot Home

I believe right, Am case. Joe? I that’s the

yes – going these to a homeowners. and shop. rod big a good homeowners largest people are And the have and compressors number have got don’t Yes be of they unless

disinfect So have again, I is know we there exactly think pictures seen but – know to exactly. theater, don’t know literally – we I spray the where a gun don’t used going. I being the these our spray really of are

Right.

say that I as because then that theaters, the interesting industry. So you know

would expand a multiple utilization the or increase? their showing As day, then a of from to theaters showings sprayers two naturally then day such one

no doubt. Yes,

going. about again, we don’t know But where it’s anything

information. that giving that of not are We

So on it would be a part, Andrew. our speculation

and the retail would Florida what greater that sequential enjoyed sectors, one jump sector of would than Now the a this the be – quarter? of automotive those XX% fueling industrial the also last be from Pneumatic, things about

are big resorters They not obviously. complaining, are we and very just

But in visibility sustainability? of terms and

the know quarter. – the should that. I that. know We of for We been part to better basics going it’s I don’t you, it’s of don’t to the going answer mean the say been on

and I are own our we it’s just it that again. so hoping but So, opinion expecting it’s mean perhaps – continues,

the Okay. go you and already? Well, continuation November. middle in into October are see that of Did we

Nothing has changed as of yet.

I QX think, on. moving is,

am and not the that’s headwind primarily, Florida if sure sector? Florida anymore. in is across sector something Pneumatic other I board that I that’s guess, really the On in that’s the or it Is Pneumatic, separate Aerospace Jiffy aerospace obviously,

It’s both. It’s both.

it Boeing is primarily suppliers? And it’s – okay. and primarily Yes, Boeing

Boeing primarily Joe? say I Yes, would Boeing it’s that suppliers. Is correct, and

percentage greatest of but exactly, Not it.

been least as certainly production while for at military has slowdown there had but a right? Yes, in been a or well, there

to show trying life of a bit little now. It’s

Yes.

to then questions. in ask back I release let will you your Now out mentioned others and

You the and the into mentioned what were samples and some during approved manufacturers, and you that development about I then aerospace on in servicers, these how is mill that projects commercial encouraged ready. specked utilization these it if And that you opportunities have industry, works? that by some in happens have tools again been for get etcetera is are pandemic accepted, am samples under aerospace assuming your release

Correct.

– Yes, that’s you correct. can yes,

you some can into that the And maybe aerospace publicly Okay. are trying development under of that name then? are get to projects specked you

we have you think information? Really should. or Joe, we do could don’t any I

projects commercial range No, to industrial we commercial but into go are military across and that detail, worldwide are or projects. say the that and and I not they of would level going

Okay.

manufacturer Europe then? you making large headway some been that So in have into airframe

Yes, we it. are on working

with am Right. headway yes, than now. that. we is mode Europe shutdown worse in we saying, now, right in It’s case making I are project. But a are course, a of

shutdown country. whole It’s the So parts of Germany be. we not what’s right shutdown. now. Germany, is to going know UK don’t is

is Italy know. think close, don’t very I we

but Europe, Andrew, didn’t. we would we in am confident having if not pretty meaningful for the some pandemic, I be sales

Exactly.

no pattern. Nobody is did in literally no visitors. a There holding It’s testing. just

Okay.

I be the and is mean two-week to course going come is it of So pandemic overcome. The will course the to disease a end. an

next vaccines are the on their way by year. So,

be that’s what tangible want as And investment, So feel get are which is and to we it’s net long open below the generating profit then is towards the at you and going your securities less call. capital. sector to entity a why are then book and than as we are this value economies XX% interesting up, the working of sizable running contribution for pandemic a an

Right. Yes, exactly.

out I back more do and me questions. have Let

back come me. to please So

Sure.

it. got You

you. Thank

take Henry [ph]. will from We next Dubro our question

everyone. morning, Good

Good morning.

two have questions. I

in revenue With the ‘XX reduction in decline third versus ‘XX the quarter any approximate there has workforce? XX% been

Absolutely, absolutely.

So how workforce? the has

ahead, go – reduced not have Joe. We

Henry, reduced we workforce have XX%. our about

did that when And occur?

ahead, Go Richard.

May, staggered, believe Is was it it that I right, or June from to guess. was August I Joe? basically Yes, but about

some Yes, was there the it June, and was before but was of after. some there bulk

no and the or and/or bonus any bonus talking know question want is have there expensed I I Horowitz whatever like X the proxy for would spoken about statement there to the last X what one SG&A, is the amount you the it? assume… bonus Right, detail months that’s to okay. call months since am I into I for if executive in

are company Yes, bonuses dramatically entire the across reduced.

number. a I very, know be would but little there exact small don’t very little very I the – So, mean, number,

Yes, follow-up bonus. Mr. Horowitz’s me just the let ask to a

Is proxy in bonus the his amortization. the and for statement formula stated earnings XXXX? a that taxes, formula of As fiscal for was set based ‘XX, same ‘XX upon before depreciation

answer the Joe, yes. is

used a there been years, sort we really There that a term. that of isn’t And has that profitability... don’t know I is structure the use over formula.

of earnings One on company brief the depreciation of was target calculated before upon the a thing. level amortization primarily of taxes, and based achieved achievement It minimum by level profit company?

would suggest a I this Henry, call. this that not question is for

head feel comp the contact this, of committee. to question information answer to free the The as they If they specific questions can. you contact have best and the comp a committee their will

accrual something charge asking pertinent or bonus I a for there if was But in an quarter? this see the to am

question. for quarter, Well, you the Joe, the answer For a good can quarter? that’s that.

any All modest bonuses would for in the the quarter. have bonus quite quarter, been accruals

If So anything, they it number. is are not wouldn’t material there material. a be

Because I okay. it, order read have this, okay, as the company... Okay, to in

Henry, the question. question We we the for answered answered you.

read we the question So answered it, you. is how fine, you but it for

another have question? You

No, no.

you. thank Okay,

you. will We our Shapiro question Management. [Operator take Instructions] next Andrew Lawndale from Capital Thank with

XX-week the is methodology? your versus your the off, The Thanks. A on company’s debt. to it apply long-term portion plan X-week details sheet – the timing company’s shows for more the long-term current follow-up reduction loan, the I for maturity Henry’s a apply measurement balance you it’s on forgiveness, to – migrating workforce which first the questions measurement think and when payable about from PPP now

Joe? Yes.

Yes.

workforce I application, your first when clock it And starts on, reductions to to upon come? of then the Okay. going ticking the off, you’re and determination submit forgiveness calculations, for the based which guess, is when

we’ll be sometime in in missed will have exact an doing but it sometime be short time. imagine – be we we it, time – it quarter. don’t it It’s the when but I It – don’t be will this we’ll be will – I now,

Okay.

the time, or line you been the recovery quarter be upon funded event onetime a forgiveness a and likely quarter already fourth based do and associated have to loan the bottom to benefit? expenses on thus, recognized that decision of be So first on anticipate the PPP which

can answer you Joe, question. the

on I’m I from mean, internal but can know to process application is conversations they the mean I our don’t based we that say, after the we I’m what with I regarding Sure. the guessing. mean I guessing, for would in it’s around bank think but their roll it file a and timing sure. SBA, going just I I into turn QX. week, understand

that that, think sounds time kind. is as it that be is I I some the this then indicative of a to slam reduction applications, have as I if to don’t kind dunk perhaps. this And are to occurred window, program, But efficiency during mean calculate. you going as to calculating the a they that of have bunch middlemen if, of limit. workforce mean, be going had bureaucrats there well

So, the we the calculating, they don’t do do calculating.

but the calculating, they Yes, verifying. you do do the

is... amount Your

Yes.

okay. Yes,

So that’s be going one why to a it’s week turnaround. not

you included feel expenses other reduction, that of are that all and do have on based workforce $X.X said, up being and cover all will payroll but your allowed that So in period the the that other allowed million? the expenses be that to consumed XX-week

this pretty – we this forgiven. unless I’m to that some speculating, Again, there’s will get XX% confident XX% say but that we’re plus of plus of are surprise, going

cushion the not you’re amount that some which an so applying excess $X.X in – would But you gives you over? Right. necessarily for of that’s get million

it’s we’ve Again, help the some Yes, with how million. works, all $X.X complicated and it of a been for concept to consultants isn’t working applying it. of there kind us little with than on greater really a

we though on had in it did not a the even my have major affect, reduction, opinion, So workforce didn’t effect calculation. a

going go this for you Okay, which and it and in it account going reversal statement? to gross of And loan margin the plan the the event, other would loan else? do How lines, so a it an account income the and to time, the for and not it forgiven the would like payroll when QX treatment alright. bulk to the of out QX, Is be something being gets the it then your income subsidiaries something – a what – Is statement? and everything gets do running you potentially of where line? on income various are see into obviously cost to be

is happen. if next administration, I assuming of It with a to be don’t will again, expenses. we’re there’s knows that forgiveness And reversals scrutiny the be the definitely assurance there’s be a who be going greater a around to item. this – this various administration. lot of separate to no line application. going scrutiny going And next we’re There’s think doing there’ll

be financial. space – So in again, assuming plainly visible received, will is line some the it a the that it item but on

Okay. share. $X it’s Well, almost a

So it’s not insubstantial.

and on reason resulted Hy-Tech modest into reduction it’s Hy-Tech in it. sequential to Can the wanted – so what’s a rebound nitty-gritty saw then called why And in Hy-Tech – on the it what about side you aggregate, provide sequentially, a has was of Talking maybe further those that’s get decline. pill I had on color So OEM but the in a and the instances like that things bit side. what that now, improvement actually, maybe had on talk both little is to bitter OEM the about onetime Hy-Tech that And some ATP is a stabilize? sizable and ATP, it about what in started drop-off? what sustainable

Yes, I why mean, it? don’t But… discuss you Joe.

Sure.

in customers’ don’t to speaking, concept. Go We generally can names, but you we ahead. discuss talk

a of was in think ATP, oil it’s with second the down the oil and everything other reliant don’t special there. on down, the Starting and gas in I in rebound anything very weak I being quarter. But Again, addition ATP think gas to just is things. orders spring. there’s the among very

of orders, return a bit just again, and more gas. of normal to it’s So little excluding a a level oil

So that’s in ATP, nothing particular there.

On the…

to me, – say, the excuse season add, are ATP oil very so. gas had just hasn’t Gulf, and hurricane the it with more active needless and I’ll in situation even to reliant exacerbated in we Yes, the it’s

lines those come… like retail and not before having sales not It predictable comes products. Florida of we but and Pneumatic we but like things that. pretty. It’s meaningful, with really –it’s of for late, – gotten for and some said – like that the have So sales that, But

count rig count the the stopped it – further. dropping Although rig has seems

watch a $XX in – week ago remember oil and Okay. tracking it day, think price in been count maybe lines. and – it’s It’s ever of – It’s which this almost the something has those gone That I count rig the every That since about just honestly. low. so rig the low. is along or don’t it’s like until we again, I and now single up – this

ahead, it it’s area. control precipitously been mess and – But again. Joe. just now all it’s Go a in regaining So big it’s that dropped

largest customer, in took Switching Hy-Tech’s us they again. then it OEM while to Okay. OEM, from before last and be ordered told June is that over shipment us which their customer, an would a

So there next were other nothing way parts the third of than or that customer, nothing – to – spare don’t maybe I maybe some the sales whatever in in quarter. to

area. that’s big another a revenue pretty customer So even bigger in orders stream has percentage, major a the reduced category. hole well the as hole obviously, OEM as the OEM in And and an in dramatically their

going that’s So on what’s there.

that, to at is of having in from order any But it a have said QX least forward, consequence. it, build last that week, it nice impact while customers But get think. life that going we of and – some did takes very it an won’t the there’s area on in a we one those probably which shows

Yes.

lost competitor, was they you was ask I going what are indicative think a is if having that’s this I to unhappy? share to of

No, no, that. of none

No. of pretty cases, In those we’re both expecting.

quarters transition, that of require stream So would no. change many – any so revenue in

type get to the of on user feel the end of we you for could describe a demand? or customers whether product for assess those Can visibility two market of return Okay. each

just finish. One to. I them referring was you and ahead, gas, go can one item oil gas Joe just related And was oil of yes, and

Yes.

general So some in it’s oil and gas, and automotive. generation power also

one entirely other almost is The aerospace.

– That the think I gear largest newly with a versus it on that which now business mixed acquired my – XX% is beginning legacy acquisition sector second is this case Almost, PTG little of a with gear group, some than guess, business, transmission sequential talk customer which, I Blaz-Man, group your basis? mean sector that of more combined the it quarter offset of Hy-Tech. revenue-generating bit Is PTG, the Okay, was guess, a the the was power was weak slightly alright. all meaning, one, because gain is by can business, the more again legacy last measurement the you products I entities, is this is I to the here the quarter’s and or – I traction. the And that bag, is revenue. now about, or of guess,

to Yes. we what say through would release. said really much Well, – pretty be have Blaz-Man summed up customers. We headwind we you can’t like not really discussed you made as we Having it that, well. to going as the we’re we’re the going in because Whatever go is not said. just press in the business exactly that

times, a a let that that of in customers that these kind We is do able from something the a It’s of thing. and at. a business in maintained do kind haven’t been won’t itself very we it’s or not to see encouraging hands-on stuff levels sale. on But And us it that, really can has email. that we to bought FaceTime or

is referred for Our the side, you businesses, to, that. Joe but to may other add agency as down, so

oil, that business. legacy that gas, was the gear Yes, half fracking was maybe and mining. business And of

up for now. So all right that’s dried

it’s along. So struggling

growth roughly we’d are mean difficult you the you sit more like door just we they But is says pandemic of matching front I of still that in customer, have revenue of a we to the the being would the visit business if an make places is. bought in again, that – the how if We Richard’s only one even like pandemic. – a that in there and a almost the without sales maintained – a of of make considering flat. lot the area, level which can right, but started, it visit can this go it bought, give businesses see visits, five we We we’re before after But get doing would apart be been to I’m so to And the had places we before the we sense even whatever, a to that them, able to we hurts. up. looking number visit. going some gearbox, definitely has XX%

when good relatively the customers in do we success. And had go person, see we’ve

So we get will we customers. that that, expect to see as continue more

in customers that the Right. have distancing yourselves, of essential being are presumably, of your a product of sales keep a customers, and primarily person and necessity? your experience these eye, not they in And people just that is because in they need there of extended an in that the out some there At your has and keep any an evolving for explanation a is evolution not on product these would for right? eventually or ready need services, – And in to COVID here from person, have prevented you from some a are for virtual process okay? to point, – customers

add… I have just would – we able I be don’t the say that, can but so think we to to information

to gear your are they if perspective your customers or can’t that that are go person? – what They it Are it you this it current – need is your comes and do visit in they you do? done, what like What work when prospective doing you – do?

get They can do to in the phone talk on with it you engineers a our through. The at thing The desk. the sit room, sample They a next okay. part, about best talk then Well, optimal the look Okay. to got engineer. point the it on other is send and thing things. their is part,

you in as is to is can better. best technical, e-mail make thing highly If about the The do you any as as being build drawing. when hey, you’re front talking can somebody it’s can just, But you imagine, this spec? third in always simple sale, of something especially something

the impossible. to So you you’re out, send somebody just grow off – breakdown. us that’s want or they’ll business breakdown If gearbox try breaks down, to send But be to you parts, not of kick that. It’s there’s drawings if we got a front impossible. the there’s and and in not But can us it’s a them. not either work the

be You to their got in building.

customers, but this new things Yes. think the the it share have like we have customers and to gaining eventually normal, to I share virtually? gaining would is difficult, – need the essential done servicing who being are adapt seems

we’re Well, remember, Andrew, business. doing

So we that are and we what two are doing, getting satisfying orders whatever have they the them. we the are customers have are and that we gotten, that’s we having

We are doing that.

at efficient becoming Are doing them? things more

efficient, think volume I factory become we talk more need in you think I itself, need about volume. if to more we more the

Being more efficient doing you just things to… because have virtually

of Yes. guess, for and definition, I yes, as that but by already, customers hands new really have the for engineered need people see a hands-on customers, in it’s a Well, said, abilities. not level they I most have it’s to because they – people. the product for and part, existing experience a the confidence But we our

customers So to convince harder they talk to over are new us telephone. but a so that we stuff, can do much their

out. back will I Okay.

yes, else the in is queue. there nobody Yes,

have more questions. Okay. I

Sure, ahead. go

Okay.

negative let balance would up, one-timers mix? sizable offset profits, is someone So Hy-Tech sectors, wasn’t From this this obviously margin. gross last but quarter. sales one-timers margin last on? there and quarter, is that gross were gross than assuming am loss to if increase there last an on of sectors there in profit margin, of quarter your from I’ll remaining gross small questions. just continue it albeit profit in of a a to quarter major improvement but business to a this On return know it on a shows Hy-Tech be because and I while by increase, wasn’t revenue Hy-Tech, is this otherwise, sequential some are my there else reduced was with overall more function a was in a in the what gains quarter involved? other Or this function me What

But we way very it, to very, the and Joe, customers had It’s last can on been add Is very but of our to that and that. are saying see a best now for year increasing heavily and Joe? on full-time of and, margins focusing it, heavily. very that – benefit increasing is very margin in the gross onshore heavily, trying simple answer, we the

going is QX... other absolutely are on, That two factors, but there

QX query My to from second QX. was –

Yes.

you the second had in the remember. you inventory as quarter, Remember write-off

Yes.

that amount that equate would out? might it So, well. wasn’t what was help it Maybe

still to on I what we transition. like – are we we would were build PTG, new people, with full figuring working still QX before in hiring seeing in out just had consolidating, built at regard what not say processes. It Punxsutawney new would to how we to had,

hit So that of list the you of sorts just you locating not long that margin There’s had locating absorption, for inventory, implications things had. PTG. thought training, all a at inventory, gross

thing – item, it’s drove by So large of certain order have OEM And one which in mile. effect they their even that took lowest any that a a the then customer Hy-Tech is the one it. margin bigger last that that June, all stopped I say wouldn’t is second

So is them a margin. the mix, average dramatic in without improvement in there

one thing, goes So, as but absorption revenue going our then all things were of on. three relates, down, overhead drops. kind those And more which of

a So two even product a didn’t even we machines person And empty time our good, or we though sitting might lot be looks the around, people layoff margin pretty when three person running and of a machines. are busy. maybe that standard we though got of at

machine. one running Now they are

So absorption that is overhead lost.

QX. going So on to there’s between a lot QX

a QX think little be to to I stable. going QX more is

ramping are are of that we get at PTG employees were out it still the consolidation, We – phase up where there.

were are in to OEM one quarters, missing not they a Now they that solid. the processes QX couple of QX. going Again, have now are are customer we

than a going quarters. was to QX There QX on So a between lot two comparable Hy-Tech just to QX. those QX more at lot will look

QX, hit in the And gross that was impacted margin was it… in or Hy-Tech what inventory

the consolidating still got inventory moved... was it Again, that

quantity. in no was What amount? No, the

was. what I am sure not the amount

It was...

not disclosed. was It

alright. Okay,

that’s one reason. So

say it’s an ends adjustment, in keep as little sometimes inventory an a inventory contributing but mind, factors – it write-off, there’s are a just again, you more. up but It lot And to could of that. there

So couldn’t to inventory say mean there’s I just reason would just the then on. – is an change, hesitate going find lot if I a it’s it. it’s you

Boeing timing. that by you but be used a that’s in their are be thing. the QX, got end or two making to how itself American you little approval of not of doing time everyone of bit Obviously, year. that. the the known their this have going in of will seems greater they of pilots phone whatever are would do in In that other start they be and starting a about globally, in announced apparently air Boeing going on – their call the kind future stuff, they to of to described very segment other ramp-up the that supplying sales seems approval to from also in you they week, planes production MAXs kind foresee then aerospace have XXX have they some They or as is everything the believe to do is timing of airlines them next based have ramp-up by now. timing opine calls thing the What week comes re-certifications, the to are incremental they MAX training I the products before get a MAXs, handle built where you the will simulator inventory, you this? the the to start XXX XXX have start visibility right Can when else, It some and to of and all going it, your and delivering and they the what on flight. up can where Okay. near fly horizon, in this the there kind getting QX regarding line what get now Then order the pecking in information and visibility have Airlines if return just the U.S. last suppliers fairly of to the will train. and going assuming

been talk – guess what you could you can about we I’ve and days. discussion do I few in Joe, with

So, a couple of things, Andrew.

there there is a Boeing is which which we of So supply. to, of the course, major supplier the we fuselage, facility, sell

We still, right?

Yes.

are if I a to demand, January know to going got saw lot in if inventory. ramp-up. it’s They even on lagging be have I don’t They I Spirit, X. build year transcript. a you next Boeing the ungrounded conference their read growth call, to even Honestly, needs jet think Boeing So indicated don’t of did satisfy they have the

know really answer. the don’t we So

have We numbers. heard

you Boeing a course, Conference a the XX overnight. Call, on about – don’t being month month to XX jets talked they think and from XXXX. at of X Spirit early But by I go month a

slow to don’t be just a month we’d – doubles, going it’s It’s I even are a think just think I ramp-up. there And that four now. if So much. see

So and modest. I in the wrong. be guess. if – be to could speculating. But just there do, my I’m it’s much going I and just going business until QX, pretty of even again, – we see don’t think we’re way that’s to

Is case, Now your if if as is. right drop business where It’s is from that not right? the would level it were level nil. business now your that

Yes.

the We really Not to but Boeing, but do – do some of business attention, our business yes. – we business. and enough other draw in factors modest yes,

You a may are trough, until trough. QX up the the at trough from towards building

correct. That’s

XXX,XXX Yes. direction, I are. about would we fluctuating where we XX,XXX, say give either are it –

going aerospace we’re We’re now. sales right to about in where be

a going as were to what then And XX month hit? a all start whatever, this they month, – running Okay. month and they from or go X a they at again, X before

XX.

XX, think was the I XX, XX, don’t know. number I

was think Rich is it it’s – XX. close, about I

other Okay. And you but getting are a that’s that looking into specked that’s I with bunch on and particular programs. business, development obviously of – mean

yes. Of course,

things Okay. And model? kind impacted grounding by rather that any of – a COVID those than of are

not on, for mean doesn’t I we’re on many we a revenue, working right? to projects any have that it project Well, how are an I’m if MAX, XXX installation working is matter tool going

you is are But This XXX, what Yes, trying on them. No. that’s working stuff and for yes. Airbus is. it to or

projects on working You’re that… military other some

yes, Yes, absolutely.

for been a that’s Airbus like is COVID grounded? model they sure, impacting not have And

No.

whether XXX, I remember the is it main think read XXX, that I claim I Airbus can’t rival XXX. whatever, their XXX, to

building that. month think they I are something a or like XX

into And that? working to get you specked are

exactly don’t we working the multiple I for I there’s – are X mean, have got, the multiple tool, applications I on. things the tool

on parts not am be be necessarily – tools might Fuselages could the in, but involved It making part making not There various Airbus. components upbeat model a I various what suppliers or there even So model Spirit to and the exactly of these is what is to for various probably Airbus And directly. completely growing. of selling like the jet.

of So all we to them. talking are

of now impacted terms out you bit of in wave? been, since your severe supply are little all been chains? if a you Asia the second those better has had a suffering at come Have circumstances and COVID impacts mitigating And not necessarily

We really ahead, are. go Yes, Joe.

that. free at through are able this there that, were least point, We at were out We of definitely – in work now. impact. home it. was are to for on But we There some QX,

that, said the that side. not or Having unexpected we that Andrew, demand didn’t some there order products are to the we due retail on received

it for turn some been orders getting because on imagine. force as to we of happen doesn’t now completing it So that had shipments there’s overnight, you can slowdown and and the

the that’s So thing only

go lose Did you they you or Do the orders backlog? go lose those orders a backlog? into or will they into

go they of most most most of them, into No, of them, a them. backlog,

I us part. this It’s that Well, generally, centers that, let – store up guess, that system the in the I is distribution yes, more the a am to at that’s particular say, or enough just inventory true. make there on going level

only the when and XX. say, supposed at we they items. item are can we is Well, center to Let’s an XXX, have distribution the of have other give the XXX

XX. other the order So

to guess it we flack I’m to is not out. out, us still. that system and it’s of distribution that filling about stocked where not the the but There’s out not stores – centers the maybe talking generally, kind up, really – are are I It’s in it not goes distribution eventually, the you into enough there. So ends are gone. centers. stocked sure I it guess get stocking when – are going not the Mean

catch and the to your humming we a things, it presumably keep fill factories will right? Well, then little levels, those up bit better

Yes.

for you do made wound not the of on circumstances? – that the of our And you back? tariffs of good. of you likely and of to you including terms if discussions focus do In potentially were insight shifting differently light a worry or in things your seem expect of different be where the relations, of if a tariffs. regime a around year because us concern a to chain before only potentially a in there do were trade shift supply think or – or have may Would I And shifting be ago, to there down tariffs company, any is of change may a that wound your some Okay, shifting approach the what the shifting the tariff all – or problem any past. and

tariffs think be are back because there with don’t you be will our any I money us the we that Is asking? question either if customers. will impact gone, getting way, were to the that

or with some go in is, cause one And terms if was you any. – the one to? are that back you impact, your had tariffs or any the suppliers, Yes, or which where supply shifting happy other you margin move you does caused in it shifting? of Would your chain would

are No, where we are. we staying

but that’s That’s We what not back. our now, mean, – could are I as change, plan. Things it that’s going is.

Got it. Alright.

I think for that’s other it than. quarter this

mid-November. we – are again, We are

quarter optimism? pace same the the are is far things quarter a quarter, so the QX, the You has starting gives bit? or at you this – up concern pace? picked you that when started we What are ended for Where

nobody the the quarter third I you to I – to or any of We same mean think or know don’t window. has else that’s to for be. the level the any current could quarter. don’t of don’t say to themselves I don’t know know. We the do going don’t you weeks going to at have that. But I what Joe, they have you I don’t things that ball. I probably that I can’t optimism if have anything to don’t think that? six concern. sustain the are don’t a continue. crystal have I not. don’t were know levels if as – have about of tell what’s we I anything been we not as we going level We – add because in am want vision told orders first that the

could that I were mean, major end could of But – September. think the No. be a there’s tomorrow, change from I it mean, I where at don’t different. been we

weeks five quarter. the into So

is far, point. normal not down, they we that. many what but and can government for Right. obviously, close economy all have know over and you, and don’t thing. If then my what down predict more. we We no answered saying what that the expect. you the – question Andrew, can’t Clearly, whole are it too tell a different It’s there and That’s cut that variables the we we we is so we that know control we

more than are Anything there Operator, we can’t So questions? we lose Andrew? any that. else, Operator, questions? other any other can’t you help Okay. answer, Hello? Did him?

further no time. this at in We have queue questions

Okay.

for you. stays on with all look that forward to we call the well thank you Happy And you at everybody. to and time. hope healthy everybody Thank and well. that we year to and continually So Stay today, being end results Holidays our speaking

and you, concludes Thank ladies gentlemen. teleconference. today’s This

may now disconnect. You