Good afternoon, everyone. Welcome to AAR’s Fiscal 2024 Third Quarter Earnings Call. We’re joined today by John Holmes, Chairman, President and Chief Executive Officer; and Sean Gillen, Chief Financial Officer. Before we begin, I’d like to remind you that the comments made during the call may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Accordingly, these statements are no guarantee of future performance. These risks and uncertainties are discussed in the company’s earnings release and the Risk Factor sections of the company’s annual report on Form 10-K for the fiscal year ended May 31, 2023, and Form 10-Q for the fiscal quarter ended February 29, 2024, which we expect to be on file with the SEC shortly. In providing the forward-looking statements, the company assumes no obligation to provide updates to reflect future circumstances or anticipated or unanticipated events. Certain non-GAAP financial information will be discussed in the call today. A reconciliation of these non-GAAP measures to the most comparable GAAP measures is set forth in the company’s earnings release. A replay of this conference call will be available for on-demand listening shortly after the completion of the call on AAR’s website. At this time, I would like to turn the call over to AAR’s Chairman, President and CEO, John Holmes.

Thank you, and good afternoon, everyone. I appreciate you joining us today to discuss our third quarter fiscal year 2024 results. Before we discuss the results, I would like to take the opportunity here to, again, welcome the Triumph Product Support employees to the AAR family. We closed the acquisition and related financing transactions just subsequent to the end of our quarter. This business, which is now part of our Repair & Engineering segment, meaningfully scales our previous component repair operation, adds differentiated repair capability on both current and next-generation platforms, and expands our footprint into the higher growth Asian market. Integration is off to a great start and I am very, very excited about what we can do with this business. Turning to the results, we delivered another strong quarter. Specifically, sales were up 9% year-over-year from $521 million to a third quarter record of $567 million. Sales to commercial customers increased 18%, more than offsetting a 7% decrease in sales to government customers. For Parts Supply, total sales were up 6% year-over-year, driven by strong performance in our Commercial Distribution business. In USM, demand remains exceptionally strong, which drove another quarter of growth. To break that down further, individual USM part sales were up significantly year-over-year, but large asset transactions, such as whole aircraft and whole engine sales, were down. This reflects even tighter supply in this market. For example, opportunities like the 757 acquisition that we made from American Airlines last year are even more difficult to find. Having said that, we have the best sourcing team in the world and continue to have the balance sheet flexibility to be able to act quickly when those opportunities do arise. I mentioned strong commercial distribution performance and I would like to highlight that specifically. Commercial distribution had an exceptional quarter, posting 27% organic growth. This was driven by growth from existing product lines, as well as the early ramp of recently announced wins. Government distribution had a lower quarter compared to a very strong quarter a year ago. However, government bookings have been increasing and we expect growth to return to that business moving forward. In Repair & Engineering, sales were up 10% over the prior year quarter as we were able to drive greater volumes through our hangars. I’m proud of the efficiency gains we continue to make with our existing footprint. In Integrated Solutions, sales were up 15% over the prior year quarter due to increased flight hours in our commercial Power-by-the-Hour program and the contribution from Trax. Finally, in Expeditionary Services, sales were down 15% over the prior year quarter due to a decline in shipments of pallets to the U.S. Air Force. As a reminder, we are the sole source provider of these pallets and we expect the DoD’s procurement volumes to return to more normalized levels in our FY 2025. Turning to profitability, our adjusted operating margin was 8.3%, up from 7.6% in the prior year quarter, driven by margin expansion in Parts Supply and Repair & Engineering. This represents our 12th straight quarter of year-over-year adjusted operating margin expansion and our margins are now approximately 50% higher than they were before COVID. We are especially proud to have made this progress in an inflationary environment in which labor costs in particular have been rising. Our adjusted diluted earnings per share from continuing operations were up 13% from $0.75 per share to a third quarter record of $0.85 per share. With respect to cash, we generated $20 million in cash flow from operating activities from continuing operations. Our cash flow and EBITDA growth resulted in net leverage at quarter end of just under 1 times adjusted EBITDA. As you know, we elected to finance the Product Support acquisition entirely with new debt. Pro forma for the acquisition net leverage at the end of Q3 was 3.6 times adjusted EBITDA. The decision to finance entirely with debt reflects our confidence in the continued cash flow generation and EBITDA growth and our resulting ability to deleverage. Turning to new business during the quarter, we announced a new multiyear distribution agreement with Ontic to supply certain military products to the U.S. Government. We also announced a multiyear contract extension and expansion for flight hour component support services with ASL Airlines. We also announced Trax agreements to provide eMRO services to Singapore Airlines, as well as eMRO and eMobility services to Archer Aviation. The Singapore Airlines award, in particular, demonstrates the power of the AAR track combination as AAR was instrumental in securing that award. Finally, just yesterday morning, we announced an agreement to provide surplus CFM56-5B engine material to Cebu Pacific. This agreement leverages our long-term supply partnership with FTAI Aviation and drives further predictability into our USM operations. With that, I’ll turn it over to our CFO, Sean Gillen, to discuss the results and the acquisition in more detail.

Thanks, John. Our sales in the quarter of $557.3 million were up 8.9% year-over-year. Our commercial sales were up 17.6% year-over-year, driven by commercial growth in each of Parts Supply, Repair & Engineering, and Integrated Solutions. Our commercial distribution sales were a particular standout as we continue to drive sales growth on existing product lines and expanded newly won product lines as well. Our government sales were down 7.4% year-over-year. However, sequentially, government sales were up 5% as we have started to see a recovery in our government activities within distribution, Integrated Solutions, and Expeditionary Services. Gross profit margin in the quarter was 19.4%, up from 18.1% in the prior year quarter, driven by strong performance in Parts Supply, as well as Integrated Solutions, including the high-margin Trax offering. Gross profit margin in our commercial business was 19.8% and gross profit margin in our government business was 18.6%. SG&A expenses in the quarter were $77 million. This included $9.4 million of Triumph Product Support transaction expenses, $2.8 million of Trax acquisition and amortization expenses, and $2 million of investigation costs. Excluding these items, SG&A was $62.8 million, or 11.1% of sales. Net interest expense for the quarter was $11.3 million, which included $6.1 million of costs related to the bridge financing commitment for the Product Support acquisition that will not recur going forward. Cash flow provided by operating activities and continuing operations was $20.4 million. This is net of inventory investments in Parts Supply, specifically in commercial distribution, which, as we’ve mentioned, has significant sales growth in the quarter. Our net leverage at the end of Q3 was 0.95 times. As John indicated, we financed the Product Support acquisition entirely with new debt, consisting of $550 million of unsecured notes with an interest rate of 6.75% and an approximately $205 million incremental draw from our revolving credit facility, which we upsized by $205 million in conjunction with the acquisition. In Q4, we expect our net interest expense to be approximately $18.5 million, which consists of $9.3 million associated with the fixed rate notes and the balance from the floating rate revolver and the amortization of financing expenses. Going forward and consistent with our reporting for Trax, our adjusted operating income and adjusted EPS will exclude non-cash amortization expense associated with purchase accounting. Our adjusted results will also exclude transaction expenses recognized in Q4, as well as integration costs that we expect to incur over the next 12 to 18 months. As a reminder, we indicated that we expect to generate $10 million of run rate synergies from the Product Support acquisition and expect that it will be accretive in full year fiscal 2025. However, in Q4, we expect it to be slightly diluted to earnings as the incremental interest expense associated with the acquisition will modestly exceed incremental operating process. As we also indicated previously, we will step up the tax basis, which will generate approximately $9 million of annual cash tax savings for each of the next 15 years. This will not impact our GAAP tax rate or adjusted EPS and we expect our adjusted effective tax rates to be approximately 27.5%. Before turning the call back to John, I would like to take this opportunity to thank our bank group for their support of the financing of the acquisition. Their additional $205 million commitment to our revolver reflects their confidence in AAR and the merits of the acquisition and allowed us to partially finance the acquisition with flexible pre-payable debt that facilitates our delevering going forward. Thank you for your attention and I will now turn the call back over to John.

Great. Thank you, Sean. Regarding the market going forward, the continued new aircraft delivery challenges, as well as the GTF and other engine issues means the demand for current generation aircraft and associated maintenance and parts requirements will remain strong. This is good news for AAR. While this means that USM supply will remain tight, we will continue to leverage our global sourcing network to secure materials to meet this demand. This also means sustained high demand for our commercial distribution activities where we expect significant growth to continue, coming from both existing lines, as well as new contract awards. In Repair & Engineering, I am excited to announce that we expect to break ground on our airframe MRO facility expansions in both Miami and Oklahoma City this quarter. Once complete in our FY 2026, these will add approximately 15% capacity to our network. In the meantime, we will look for ways to drive growth and higher throughput utilizing our existing footprint like we did this quarter. In Integrated Solutions, we have a strong pipeline of both government and commercial opportunities, and we expect awards will be made this calendar year. We are also encouraged by the high level of customer interest in the Trax eMRO suite of offerings. Regarding Q4, we expect revenue growth in the mid- to high-teens, including the contribution from the Product Support acquisition of approximately $65 million to $70 million in sales. And we expect adjusted operating margins of approximately 9% overall, which reflects the accretive contribution from the Product Support acquisition. More generally, we are incredibly well positioned to continue our growth and margin expansion as we move into our FY 2025 and beyond. The Trax acquisition is working well and the thesis behind the combination is proving out as evidenced by the recently announced Singapore win. We are incredibly excited about the differentiated high-margin capability that the Product Support acquisition brings and our team is already pursuing numerous opportunities with our customers. Overall, our end markets are extremely strong, and we remain focused on executing on our growth strategy. With that, I’ll turn it over to the operator for questions.

Thank you. Our first question will come from Robert Spingarn with Melius Research. Your line is open.

Well, good afternoon.

Hey, Rob. How are you?

Good. Thanks. Hope you guys are well. I have a few different questions here. John, first, I thought I’d go back to a couple of your comments on the business and this concept of a slower OE ramp leaving more older aircraft in service longer. How is that, clearly it’s driving the Parts business. How is that affecting MRO? Because I’m curious if that’s increasing demand or lowering it, because you just can’t get airplanes out of an airline schedule long enough to work on them.

That's a very insightful question. Regarding your first point about Parts, yes, as the current generation of aircraft remains in service longer, particularly with high utilization, the demand for parts will increase. This is positive news for our Parts business. In terms of Heavy Maintenance, it will be beneficial in the medium term as it will lead to higher maintenance needs. Aircraft that were anticipated to be retired will now require additional maintenance events. However, in the short term, we are seeing some changes in the maintenance schedules of airlines like United and Southwest, which are trying to adjust to new delivery timelines from the OEM. While this is causing some disruption for us in the immediate term, overall, it will have a positive impact.

Okay. And then just focusing on Parts Supply, just wanted to think about sequentially through the quarter. The year-on-year growth at 6.5% was solid, but we might have expected a little bit higher, you had good margins, but just on the topline growth…

Yeah.

... and then comparing to prior quarters, how do we think about that 6.5% when we look through the various months of the quarter in terms of front of quarter, back of quarter? Is there a trend?

I wouldn't highlight much of a trend throughout the quarter. It's fairly steady, but I would break down the 6.5% growth. There are really two major components: new parts distribution and USM. Within those components, let's look a bit deeper. In new parts distribution, the commercial business had an outstanding quarter, achieving 27% organic growth year-over-year. Compared to our peers, that's among the best you can find. We're pleased with the performance in commercial distribution. However, government distribution had a weaker quarter than last year, which was strong. This year, we had a good quarter, but it was lower than the previous one. As we've discussed in prior earnings calls, we've seen a decline in government bookings throughout last year, and we're feeling those effects now. On a positive note, we've started to see government bookings increase over the past several months, which we expect will lead to a return to growth in government distribution as well. There are several dynamics at play in the new parts distribution area. Now, moving on to USM...

Okay.

... flipping over to USM, as we mentioned, we kind of break that down into two buckets. Large asset sales, which are whole aircraft and whole engines, and then the day-to-day parts sales. The day-to-day parts sales are at record levels. We saw double-digit growth in day-to-day parts sales in USM. Those packages of parts at this moment in time are easier to source. So we’re getting our hands on those and we’re repairing them and reselling them. The whole assets, the larger dollar assets, those are harder to come by, and so we saw a decline year-over-year in large asset sales. And obviously the focus of that team is to continue to leverage the global sourcing network to get our hands on the right assets to meet the demand. So anyway, I wanted to take you through, you got a few different moving parts below that 6.5% and hopefully that gives you a little more color.

Why are smaller batches of components and parts easier to obtain than complete aircraft? If a full aircraft is available, airlines prefer to keep it in service. Is that the reason?

Yeah. That’s exactly. You want the aircraft in service, and then in terms of whole engines, the engine shops are full right now. The slots are full. And so, if you’ve got a spare engine, you’re going to want it on a wing and operating.

Okay. And then just one more on engines, given MAX and the gear turbo fan situations, with the airlines extending the lives of old aircraft and engines, we see a buildout still with Pratt and CFM on their maintenance networks for these engines, GTF and LEAP. Do you have any interest in getting into the engine MRO market?

Yeah. That question comes up relatively frequently. At this time, our biggest customers in the trading business are the engine MROs themselves, the MTUs, Delta Tech Ops, et cetera. And so we’re not in the business of competing with our customers. Our preference is to be the supplier to support that broadening demand across the engine MRO network.

Okay. And then just one quick question for Sean on margins. They’ve been performing well. Your Parts business is strong. Within Repair & Engineering, there is strong demand for airframe MRO. Additionally, with the Triumph asset and the Trax acquisitions contributing positively to margins, could you potentially approach double-digit operating margins at some point in fiscal 2025?

Yeah. I think that’s certainly the focus. As you heard John say, in Q4, we think we’ll be around 9%. And if you think about the continued mix shift of Parts Supply and the impact of the Triumph Product Support acquisition, as well as Trax, all that’s accretive to margins and getting towards that 10%.

Great. Thanks so much.

Thank you, Rob.

Thank you. One moment for our next question. And that will come from the line of Bert Subin with Stifel. Your line is open.

Hey. Good afternoon. Thanks for the question.

Thanks, Bert.

John, to follow up on one of the previous questions, regarding the guidance for the fourth quarter, mid- to high-teen sales growth suggests mid-single-digit organic growth compared to the 9% increase from last quarter. You provided a positive outlook on many of the contributors. What factors are leading to the slowdown? Is it simply about comparisons? Do you expect USM to decline sequentially? It appears that the government sector is improving, and parts distribution remains strong, although there might be some fluctuations in MRO. Overall, it seems like things are potentially better, so could you clarify this situation for me?

I think part of it is due to comparisons, as we had strong performance last year, which is influencing the current situation. Regarding the government sector, we do see improvements overall, but we do not anticipate significant growth this quarter. We expect similar trends in Q4, where strong performance in commercial trading and distribution, as well as in hangars, will be counterbalanced by ongoing weakness in the government market. Looking ahead to FY 2025, we do expect a resurgence in government growth, which aligns nicely with anticipated continued strength in commercial markets.

Regarding the government aspect, if I review the President's budget request for FY 2025, it suggests a significant retirement cycle, and there doesn't appear to be any signal of increased sustainment spending. Are you observing something different? There seems to be some optimism about improvements in the government sector as we approach FY 2025, and I’m curious about the source of that optimism.

We’re hearing the same things that haven’t yet translated into orders. If you look at the stated inventory levels across the platforms we support, they are generally below the levels needed to meet expectations for sustainment. At some point, we do expect a replenishment in parts and pallets in particular to meet those levels. However, we haven’t seen the inflection point yet. As for government distribution, we are noticing better months and improved bookings, which could indicate that we are starting to see that inflection, but it hasn’t yet become a significant trend.

Just to clarify, I guess, the differential is more sort of weakness in parts and government MRO is steadier and so parts is the opportunity?

Government MRO has been steady. The government distribution business, yes, is the opportunity in the Parts business. For government overall at AAR, we’ve got opportunities to grow in the government programs business, so the supply chain programs. We have a number of bids out there that have not yet been awarded. We would expect to see awards come out this calendar year. They take a while, but when they happen, they’re big. And then again, you’ve got the Expeditionary business, the Mobility business, that you’ll see improvement there once the pallet awards start to come through. So you’ve got a few different buckets in the overall AAR government business.

Got it. Okay. Just one last one for Sean. You gave some color on maybe getting closer to 10% as we think about next year. Can you just break down where Parts Supply falls into that? It seems like there’s maybe an opportunity. USM, I assume, is sort of flattish, but maybe as parts distribution matures, there’s an opportunity? And then I guess as a follow-on to that, can you give us any color on how to think about free cash? Does that start to moderate post some of the parts distribution or does that start to get better post some of the parts distribution growth?

Yeah. And I think as you think about the margin improvement for the company, Parts Supply has been a big part of that. And if you think about next year, we do think it’ll continue to be the highest growing part and the highest growing segment, specifically led by commercial distribution, but also continued growth in USM and Parts Supply operating margin is close to 13%. So we’re creative to the overall company and it will help drive that improved margin outlook next year. And then in terms of free cash flow, good quarter, $20 million of operating cash in this quarter. If you look earlier this fiscal year, a little bit heavier on the inventory investment to help drive some of that growth. As we get into this next fiscal year, obviously a big focus on generating cash and delevering, as well as growing EBITDA. So I think you’ll see a little bit better free cash flow performance on that, with the caveat that the USM market, as John talked about, remains dynamic and we continue to be in a good position to source new material to meet that demand that’s growing.

Great. Thanks so much.

Thank you.

Thank you. One moment for our next question. And that will come from the line of Josh Sullivan with The Benchmark Company. Your line is open.

Hey. Good afternoon.

Hey, Josh.

John, you called out the GTF issues just in your prepared remarks. What’s your sense on how long the cycle looks like on the supplemental GTF worker? What is the peak in your view at this point?

I think that is a very popular question to ask in the industry right now. So I don’t know that I can give you better insight than anyone else. What I would say though is that, generally speaking, between that and the slower overall aircraft introduction, we expect the elevated demand to be measured in years.

Got it. Got it. And then on the CFM-CP relationship, should we expect additional similar relationships to follow down the pipe? Is the relationship with FTAI maturing to a point where you’re expecting an increase in volume of parts at this point?

Yeah. The relationship with FTAI is going very, very well. They’re great partners. The relationship has grown beyond the initial expectations and both of us have expectations that it will continue to grow from here. So that is a meaningful contributor to the USM business and we expect that to continue to grow.

And then just as far as expansion to Asian markets, particularly with the Triumph that’s, where do you think that the biggest opportunity is? Is it organic, do you think it’s taking share from internal airline capabilities or third-party suppliers?

One of the most appealing aspects of the Triumph acquisition was their facility in Asia. They possess unique capabilities there, especially in structural work. They are equipped with next-generation technology suitable for platforms like the 787 and A350, which are becoming the standard for most fleets worldwide. As these fleets come of age, we will be among the four key providers of structural repair services in that region to support them, representing organic growth as new aircraft enter service. Additionally, we see potential to enhance our component and accessory capabilities at that facility. We are exploring investment opportunities to expand our offerings in the region, especially since competition is somewhat limited if much of the work returns to Western markets. We are optimistic about having a strong presence in Asia.

Got it. Thank you for your time.

Great. Thank you.

Thank you. One moment for our next question. And that will come from the line of Sam Struhsaker with Truist Securities. Your line is open.

Hey, guys. On for Mike Ciarmoli this evening.

Hey, Sam.

How are you guys doing? I was very curious…

Great.

... if you guys maybe talk in a little more detail about kind of the trajectory of the integration costs for the acquisition moving forward. And then in addition to that, maybe cover a little bit more how you’re thinking about the pre-tax flow profile in that business as well or kind of the new combined?

Sure. I can discuss integration. We expect the overall process to take between 12 to 18 months. Most of the costs will appear in the latter part of that timeline because the major tasks involve preparing a few Triumph facilities for government work that we'll be transferring from some other locations, which will require physical investment and site reconfiguration, leading to costs. We're still a few quarters away from that cash outflow. However, Triumph currently has capabilities similar to ours in certain areas, and we believe they will be able to carry out our current work more profitably. Therefore, we will begin to see synergy benefits by shifting volume from existing AAR sites to the more profitable Triumph site. This transfer where capabilities already exist will require minimal to no investment initially. In summary, upfront cash requirements will be low, with expenses increasing throughout the 12 to 18-month integration period.

I would like to add that regarding the integration costs we should anticipate, we have achieved $10 million in run rate synergies. I believe the one-time integration costs will be slightly higher than this during the timeframe mentioned by John. As for the trajectory of free cash flow, there is nothing particularly significant to note. Our free cash flow does have some seasonality, with Q4 typically being stronger than Q1. Additionally, the main point of nuance relates to changes in net working capital, particularly concerning inventory to support Parts Supply. Over the last year and a half, there have been numerous opportunities to invest. We will keep doing this while also ensuring we remain disciplined and are generating cash to reduce our debt over the next couple of years.

Got it. Thanks very much. Helpful guys.

Okay. Thank you.

And one moment for our next question. And that will come from the line of Ken Herbert with RBC Capital Markets. Your line is open.

Hey. Good afternoon, John, Sean and Dylan. This is Steve Strackhouse for Ken.

Hey, Steve.

Hey, John. So I just wanted to double click on margins one more time. I realize we kind of asked about it a couple of times, but kind of ex-Triumph, it looks like margins were doing really well kind of in the quarter. And just even thinking back to your investor day, it would take nine months to go. It sounds like you guys are on kind of a better run rate than you might’ve anticipated. Is there maybe just a couple of things within the Parts Supply or Repair & Engineering that’s kind of driving those margins higher?

Yeah. I would say that, overall the team is executing ahead of the plan that we originally envisioned. You’re seeing nice growth out of Parts Supply, which by definition is higher and really, really strong execution in the Repair & Engineering group. And I’d like to add that, once those, again, we’re a little ways away, but once those facility expansions come online in the Repair & Engineering group, the expansion in Oklahoma City and Miami, we’re going to take advantage of the fixed cost basis that’s already existing, leverage that fixed cost base and so those expansions should drive further margin improvement in R&D as well.

Great. And then just one more maybe on the Triumph update. I realized that you guys have maybe not even had it for a full month in-house, but is there any change in how you’re thinking about the growth in terms of high single digits there or is there any change in kind of the margin profile that you’re now thinking about internally?

No. I would say it’s consistent with what we described when we announced the acquisition. The only other color I would give there is that, as we’ve gotten to know the team, as we’ve gotten to know the business even more since closing, we’re really, really excited about where we can take this business. There’s a lot of opportunity and a lot of areas where we can cross out what AAR offers with what Triumph offers. So they’ve got a great set of capability and a great team, and we’re excited that we’re now together.

All right. I’ll leave it there. Thanks, guys.

Thank you.

And one moment for our next question. And that will come from the line of Louie DiPalma with William Blair. Your line is open.

John, Sean and Dylan, good afternoon.

Hey, Louie.

John, you mentioned this a little bit in the answer to your last question, but how should we think about revenue synergies for the Triumph deal? When the deal was originally announced, there was a focus on the cost aspect, but what are the opportunities with the Triumph deal to make the sum of the parts a lot better than each of the individual components?

I would like to discuss synergies in general. The $10 million we mentioned represents hard cost synergies resulting from footprint rationalization, and we are quite confident about that figure at a minimum. Beyond that, there are additional opportunities. First, there is the chance to insource repairs. Currently, AAR spends a significant amount with other repair vendors to support our commercial Power-by-the-Hour programs. We outsource a considerable amount of work that we manage, and we also invest millions in repairing assets acquired through our trading business, most of which is done by parties other than Triumph. Therefore, there is a synergy opportunity to bring those repairs in-house for both commercial programs and trading, which would add to the $10 million. Regarding revenues, I truly believe we have the best aftermarket commercial sales team globally. Many times in places like Singapore in February, in Europe earlier this month, and throughout several meetings in North America, our sales team is incredibly enthusiastic about offering the higher margin, advanced capabilities from Triumph to our existing customer base. Although we haven't quantified it yet, the initial feedback from our internal sales team and discussions with some of AAR’s largest clients suggest significant potential to drive Triumph volume through our sales channels.

Great. And yesterday, I believe, was the one-year anniversary of…

It was.

... when you acquired Trax.

Yes, we had a little celebration in the morning.

I was wondering if the deal has met your expectations. If you had to grade the deal, would it be an A plus? Also, how are the Trax bookings and what does the pipeline look like?

Overall, we are definitely meeting or exceeding expectations regarding the deal. The only mistake we made yesterday was not celebrating in Miami instead of Chicago, where it’s 28 degrees. The Trax deal has gone very well, and I want to highlight a couple of points. First, the deal we announced in Singapore with SIA, a major airline with a complex fleet, will ultimately be a significant customer for Trax. This agreement would not have materialized so quickly without the relationships AAR has with SIA. The strategy of pairing a smaller enterprise like Trax, which has a strong product, with a larger company like AAR, which has valuable relationships, clearly worked in this case. Additionally, Trax is currently competing with other major carriers, and I don't think they would be in the position they are today without AAR's support. Our primary goal was to create opportunities for Trax, and in the first year since acquiring it, we are seeing that succeed. Our second priority was to use the Trax platform as a sales channel for AAR parts, which remains an important focus for us. We have dedicated more time to the first priority than we initially expected in the first year, but the opportunity to sell parts through the Trax network is still a key part of our strategy moving forward.

Great. That’s it for me. Thanks, everyone.

Great. Thanks, Louie.

Thank you. I’m showing no further questions at this time. I would now like to turn the call back over to management for any closing remarks.

Well, listen, we really appreciate the time and the interest and the very thoughtful questions everybody and we look forward to being back here with you next quarter. Thank you.

This concludes today’s program. Thank you all for participating. You may now disconnect.