Good day, and welcome to the Astronics Corporation Fourth Quarter Fiscal Year 2023 Financial Results Conference Call. Please note, today's event is being recorded. I would now like to turn the conference over to Craig Mychajluk with Investor Relations. Please go ahead, sir.

Yes. Thank you, and good afternoon, everyone. We certainly appreciate your time today and your interest in Astronics. On the call with me here today are Pete Gundermann, our Chairman, President and CEO; and Dave Burney, our Chief Financial Officer. You should have a copy of our fourth quarter and full year 2023 financial results, which crossed the wires after the market closed today. If you do not have the release, you can find it on our website at astronics.com. As you are aware, we may make forward-looking statements during the formal discussion and the Q&A session of this conference call. These statements apply to future events that are subject to risks and uncertainties as well as other factors that could cause actual results to differ materially from what is stated here today. These risks and uncertainties and other factors are provided in the earnings release as well as with other documents filed with the Securities and Exchange Commission. You can find those documents on our website or at sec.gov. During today's call, we'll also discuss some non-GAAP measures. We believe these will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP measures with comparable GAAP measures in the tables that accompany today's release. So with that, let me turn it over to Pete to begin. Pete?

Thanks, Craig, and good afternoon, everybody. Thanks for tuning into our call. We ended 2023 on a pretty strong note and consider it in retrospect now a solid year of progress. Our fourth quarter results were enabled by a series of trends that have been affecting our business for some time. Those trends are continuing to shape our environment as we enter 2024, which we expect will be another year of progress. I will dedicate my few minutes of comments this afternoon to describing these trends and the impact they are having on our business. Then Dave will talk you through some of the specifics of our financial statements. But first, some headlines from the fourth quarter. Fourth quarter revenue of $195 million was at the high end of our forecasted range and up 23.5% over the comparator quarter of 2022. 2023 cumulative revenue of $689 million was up almost 29% over 2022. The higher volume drove improvements in financial profit measures. Our fourth quarter adjusted EBITDA, for example, was just shy of $25 million or 12.7% of sales. Year-to-date, 2023 adjusted EBITDA was $55.6 million or 8.1% of sales. In 2024, as previously announced, we expect revenue to be in the range of $760 million to $795 million. That's up at the midpoint, another 13% over where we closed in 2023. So about those trends. Our fourth quarter results are really kind of the expected results of several trends affecting our business. None of these are new. We've talked about them to varying degrees over recent quarterly calls. In other words, there was nothing really special that went into our fourth quarter to drive these results. It's more just the expected result of things that have been happening kind of under the surface for some time now. And I'll talk through them in any particular order, certainly not in a priority order. They're all important. First of all, demand has been and continues to be just really strong. And for us, airline demand or travel has been strong everywhere. You see this in pretty much any metric if you follow the aerospace industry, the one exception being China, international travel in and out of China remains pretty weak. But in most other major parts of the world, travel is near or at or even above where it was in 2019 before the pandemic hit. With that, production rates of major platforms have increased over time in our major markets. Despite some of the challenges going on with Boeing 737, there's upward pressure; 787, there's upward pressure; Airbus A350, A320, all trending up. And for a company like us, when more airplanes are being built and when more people are flying, that translates into improved or increased demand for us. And that's what we've been seeing, not just in the fourth quarter, not just in 2023, but really for years now. Our book-to-bill in 2021 was a 1.3. In 2022, it was pretty much at the same level, 1.29. The final number for 2023 looks a lot lower, 1.06, but that's dragged down a little bit by poor bookings in our Test business, where the book-to-bill came in at 0.76. Our Aerospace segment, which is the vast majority of our business came in with a book-to-bill for the year of 1.1, so 10% of our shipments. With that demand, our backlog has consistently set new highs quarter after quarter after quarter, the only exception being the fourth quarter where it came down ever so slightly. The second trend, which is worthy of mentioning is in addition to demand is the continuing improvement in our supply chain. Constraints in 2021 and '22 left us handicapped and gave us a hard time trying to respond to the increases in demand I was just talking about. But those really started to dissipate and straighten out as we worked our way through 2023, and that continued through the fourth quarter. It's not perfect. There are still challenges, but the headaches are much fewer and farther between than they were earlier on in the pandemic. And that supply chain performance is a major reason why we are able to execute on our backlog as 2023 is due to a close and why we are confident being able to predict another year of pretty solid growth for 2024. Another trend that needs mention is the improvement in personnel labor availability and consistency that we have seen recently, especially as 2023 wore on. Like a lot of companies, the Great Resignation led to turnover in the low single digits on a percentage basis in most of our operations during the peak of the pandemic; we saw turnover approaching 20%, which is fundamentally a different situation. That has settled down. As a result, our workforce in general is much less tenured than it was before the pandemic, and it's taken some time to get the culture going again, get the learning curves going again and getting people working together as a team. But we're seeing that improve, and we're seeing turnover drop back to those kinds of rates that we were used to seeing years ago. There's still more turnover. It's not like it was before, but it's dropped dramatically from where it was at the peak of the pandemic. Finally, inflationary pressures over the last 24 months or so have also dissipated pretty dramatically. Obviously, the Fed is not back where they want to be. We all know that. But in terms of the pressures we see from suppliers in particular and other costs of the inputs for our business, the pressures have dissipated and have become more reasonable. So you add all that together, and one of the things that I wanted to point out also is I look back at what's going on in our business is everything is getting quite a bit more predictable than it used to be. To be honest, in the peak of the pandemic with supply chain headaches and turnover and inflation, it was a challenge to accurately predict where the business is going to be and how it's going to perform. That's coming much more into focus as we worked our way through 2023 and now as we enter 2024. Some evidence for you to consider back in the fall of 2022, when we were putting our 2023 plan together, we issued initial revenue guidance of $640 million to $680 million. We came in at $688 million. That's actually pretty accurate compared to what happened in the year or two before that. And not only that, but our internal forecast was within 1% of where we actually ended up for the cumulative year in 2023. Similarly, with the fourth quarter, we issued revenue guidance of $185 million to $195 million. We came in right at the high end of that range. Again, another example of improved predictability, which is really critical for optimizing the business and executing a plan as we go forward. And as we go forward with respect to 2024, the trends I just discussed and the strong finish we had to 2023 together give us confidence it will be another year of solid recovery. Our initial outlook in terms of the sales forecast is $760 million to $795 million at the midpoint. That's a year of 13% growth over 2023. That's a low percentage growth compared to what we saw in 2023 and in 2022, but it's one that's welcome for a couple of reasons. First of all, it will get us back to the revenue range of where we were pre-pandemic. Finally, it's been a long journey, but in 2019, we had sales of $772 million and the midpoint of this range would be $778 million. We have the business and the backlog to do more than that, but our expectation, our goal is to be at the high end of that range, $760 million to $795 million. And even at 13% growth, it would cap another year of pretty strong performance. If you look at the topline, 2022, 2023 and 2024 at the midpoint, we would see $535 million turning into $689 million, turning into $778 million. As we work through 2024, we're also going to have an increased emphasis on margins. That's something that you always work on and worry about when you run a business. But frankly, we knew as we were operating through the pandemic that we would not be profitable at those lower sales levels. There's no way a company like ours, the way we're structured right now, is going to make money at $535 million. But as we move into the high 700s and with the performance that we saw in the fourth quarter, we think there will be room to optimize and improve our profitability as we work through the year. We expect 2024 to start somewhat slowly. We expect first quarter sales to be $170 million to $175 million. That's a little bit of a step back from where we were with the fourth quarter, and it's a pattern that we've been in for various reasons over the last 6 quarters or so, where we're up a little bit, down a little bit, up a little bit, down a little bit. But the trend overall continues to be positive if you can look past one quarter at a time. There are a few things we can point to that are going to be affecting us in the first quarter. The first is we're intentionally walking away and winding down some kind of noncore non-aerospace business that we pursued and picked up early on in the pandemic to help keep our factories full. Those pieces of business are generally not as profitable. So we are prioritizing profitable aerospace work as we wind them down, though, there's a little bit of a hole in our income statement that will last for a quarter or so. There also is a little bit of a reschedule going on with Boeing on the 737. That's been in the news and people have heard it and seen it. Boeing is and has been our biggest customer. 737 is one of our biggest programs, it's not our biggest program. And we put product on that airplane from a number of different facilities through a number of different routes. The messages we get are not entirely consistent from operating unit to operating unit, but there is it seems an overall general rescheduling going on, which will probably deflate first quarter sales a little bit, resulting in the range that we're giving. And then finally, just kind of a mix of customer schedule issues that you got to sell product and deliver products when the customers on it. So we're expecting first quarter to be $170 to $175 million. That's no indication whatsoever of wavering demand. We expect to climb pretty dramatically from there in the second quarter, and we expect the second half to be quite strong relative to anything we've seen since well before the pandemic took hold. One other comment on 2024. We have been talking for some time about an Army radio test program, we call it 45 40 90. It's something that we were announced a winner 1.5 years ago now, and we have been waiting for a directed procurement, sole source contract negotiation to take place. It is underway currently. We have not previously been able to talk about having positive momentum in this area, but we certainly have quite a bit of it now and so much slower that we're expecting to see awards there most likely, but not absolutely for sure, in the second quarter. So more on that as it happens. A little bit of a review is that this is for a platform of test equipment that the U.S. Army could use or will use to test the full range of their family of radios. And they have quite a few radios in use. It will be an IDIQ program, but we expect it to be $200 million to $300 million over four to five years. And if you look at our Test business, which is operating at about an $80 million level, you can imagine the impact of dropping in $30 million to $40 million of sales a year once this thing gets underway. So more on that as it happens, but that's one of the items, which certainly will have an influence in our 2024 plan. And we'll talk about it more as we know more, most likely in our Q1 call. That's the end of my prepared remarks. Dave, you want to take it away and talk about financials?

Sure. Thanks, Pete. As Pete mentioned, we had a very strong fourth quarter with high customer demand, and our operations executed well. The top line was driven by robust sales across all of our aerospace markets, which collectively increased by $30.4 million or 22% compared to the fourth quarter of last year. Our largest market, commercial transport, saw sales rise by $21 million from the same quarter last year. Sales in the test segment also rose from $19.8 million to $26.5 million year-over-year. In terms of margins, it was a solid quarter with no significant unusual costs or income. However, it's worth noting that the fourth quarter includes a full year of bonuses that were only determined at year-end and therefore were not accrued each quarter throughout the year. As a result, Q4 includes bonuses totaling $4.2 million for the year. These bonuses will be paid in stock to conserve cash and are the first bonuses we've awarded since 2019. The growth in sales led to margin expansion, showcasing the leverage we gain from incremental sales. Consolidated operating income rose by $10.9 million to $7.8 million, or 4% driven by this sales growth. Looking at segment performance, the Aerospace segment, which accounted for 86% of our consolidated sales, reported an operating income of 8.5%. If we adjust for the bonuses recognized in the quarter, the operating margins in Aerospace would have been nearly 10%, returning to pre-pandemic levels. This margin growth illustrates the leverage from additional sales. As we have indicated before, we believe our contribution margin in Aerospace is around 40%, depending on the mix. The Test segment still faces challenges related to underutilization, program mix, and high legal expenses. Its sales increased by $6.7 million compared to the previous year's fourth quarter, and its operating loss improved from $4 million to $200,000 this year. Interest rates remain a challenge due to our current debt structure and high rates. Our cash interest expense for the quarter was about $5.1 million, reflecting an effective rate of approximately 12%. By the end of the quarter, our outstanding debt was $172.5 million. Now that we are recovering from a difficult period, we will have more options regarding debt structure, and we will explore these as we move forward. In the quarter, we had cash used in operations totaling $1.7 million. The adjusted net loss for noncash expenses was $26.2 million but was offset by an increase in net operating assets, resulting in $27.8 million used. Regarding operating assets and cash consumption, we are making progress managing our inventory, which was challenging earlier in 2023. In the fourth quarter, we reduced inventory levels by $10.7 million, excluding reserves. While this improvement is welcome, we still aim to get our inventory turnover back to pre-pandemic levels. We anticipate continued improvement into 2024, although we face some challenges since the supply chain, while better than last year, is not yet optimal, and lead times remain extended compared to pre-pandemic. The $19 million increase in accounts receivable during the fourth quarter was due to high sales levels and timing, as sales were concentrated in the latter half of the quarter. Liquidity remains tight, and we actively used our at-the-market program to sell 500,000 shares at an average price of $15.65, generating $7.6 million for working capital until we can realize cash flow from growing sales. For the full year, the ATM program sold 1.3 million shares, yielding net proceeds of $21.3 million, mainly in the third and fourth quarters, resulting in about 4% dilution. We are in compliance with our debt covenants and anticipate maintaining this compliance. In summary, as we enter 2024, our focus will be on operational execution, optimizing our debt structure, and improving inventory turnover. We expect to use free cash flow to reduce outstanding debt throughout 2024 and anticipate growth in free cash flow as the year progresses. That concludes my remarks. Pete, back to you.

And Rocco, over to you if you want to open it up for questions.

Today's first question comes from Pete Osterland with Truist Securities. Please go ahead.

Hey, good evening, guys. I'm on for Mike Ciarmoli this evening. So first, I just wanted to start with anything you could give us on how margins are looking to start the year. Just given that your first quarter sales guidance puts you at a similar level to where you were in the second quarter of last year and you had EBITDA margins of around 9% in that quarter, is that a good starting point for what you might do in the first quarter? Or are there any notable changes to your cost structure since then you call out, whether it's labor or productivity or other inputs in the business? Is there anything that would change how we look at what margins potentially might be?

Pete, I could take that. Not – I wouldn't say that there's any significant cost structure changes in the first quarter. As I commented earlier, our contribution margin tends to be somewhere around 40% depending on product mix. So that works the same way as the top line goes down. So that would be a starting point. I think the other thing to look at would be the fourth quarter, which, as I mentioned, contained a full year's worth of bonuses in that fourth quarter. So if you're going to try to do a bridge between Q4 and Q1, you need to make an adjustment for that full year's worth of bonuses in the fourth quarter and adjust that profit up in Q4 for that.

Okay. That's helpful. So then also I wanted to see if you could get a little more detail on the assumed revenue growth in 2024. Are you assuming a similar revenue split by segments for revenue in 2024? Or does your guidance assume relatively higher growth in either Aero or Test?

We expect most of the growth to come from the Aero sector. This area faced significant challenges due to the pandemic, but is now showing a substantial turnaround. When examining our income sources, the Test division has remained relatively stable, though it has seen a noticeable decline. We don't anticipate much improvement here until we resolve the Army radio test program. Likewise, revenues from business jets have also been fairly stable, with the last quarter showing particularly strong results thanks to the supply chain. Military Aircraft has also maintained stability. The significant drop from $772 million to $450 million was primarily due to the commercial transport sector, and the recovery back to those levels is also mainly reliant on commercial transport.

Great. And then I just had one last one on the bookings environment. So it looks like in the fourth quarter, your book-to-bill was a little bit lower versus what you put up in the rest of the year, although I understood that, that's relative to a higher revenue number. But I just wanted to get a sense of how are bookings trending to begin the first quarter in Aerospace so far.

I don't know if I need to add much specifically here. I can mention that we have consistent interactions among our sales professionals across the business. I would describe the environment as still being rich in opportunities. We believe demand remains quite strong. We will monitor this closely, as bookings from the first and second quarters will start to influence our revenue as we approach the end of the year. The feedback I'm receiving and the outlook from our team is quite positive. On the Test side, if we can get the radio test program up and running soon, it will also have a beneficial effect as we head towards the year's end.

Our next question today comes from Jon Tanwanteng with CJS Securities.

Hi, good afternoon. Thank you for taking my questions and congrats on the nice performance in the quarter. Pete, my first question is, can you talk about the Army's recent FLRAA cancellation and the reallocation of resources to FLRAA and maybe tell us how that impacts you over the longer term?

It's a bit early to say how this ramp-up will occur, Jon, since we don’t have all the details yet. As you’re likely aware, we are part of the Bell V-280 FLRAA team, which won the competition against the Sikorsky Lockheed team. They are now preparing to compete in the FLRAA project. While I can't represent the Army or Bell, I believe that reallocating resources and funding to focus on FLRAA is a sensible approach and beneficial for us. This allows us to direct our efforts more effectively; Bell can also concentrate on one program rather than juggling two. I'm comfortable with this, particularly since we are part of the winning team.

Fair enough. Got it. And can you give us just a little bit more color on the demand from Boeing that you're expecting beyond Q1, you mentioned a hole from rescheduling, and I was just wondering what your assumptions are in production run rates or the demand rates from you as you go through the year and what's assumed in the guidance?

Yes. I didn't mean to imply a hole. It seems to be more of a reschedule. So Boeing has been anticipating a ramp on 737 and like many suppliers, I think we were getting those kinds of cues. We ship basically as they tell us to and they update shipping plans in our higher-volume facilities like every 12 or 15 weeks. We don't always know what their production rate is. You would assume that our production rate is somehow correlated to their production rate. But every once in a while, it becomes apparent that they're a little bit ahead of us or they're a little bit behind us. Our hunch is that they were a little bit behind us. So they probably accumulated some inventory and they're rescheduling things. But I think we're still thinking that the word on the street is that they are going to build at 35 to 38 737s a month. And while that's not 45 or whatever they're planning to go to by the end of 2024, it's a lot more than they were building back in 2020, which I think was about 0. So it's a minor kind of headache for us, but it's not a hold by any means. It's just a reallocation of inventory, I would say.

And our next question comes from Tony Bancroft with Gabelli Funds. It looks like we're having technical issues with Mr. Bancroft. So at this time, we move to our next question, which comes from Ryan Michaelmene with Mann Group. Please go ahead.

Hi, good afternoon. Thank you for taking the time. Congratulations on the results and the continued recovery from the pandemic. I think it speaks to the quality of the business and the management team. A more general question, if I may. When you think about the sort of broader lighting and safety market and your panel business, could you just talk a little bit about the competitive landscape there, who the key competitors are, your current market share dynamics there? It's still very fragmented and how you see that market evolving and the opportunity set there?

Sure. You're asking about our lighting business in general, right?

Yes, sir.

Yes, it is one of our major focuses. We are actively involved in aircraft lighting across various segments, including business jets, military, and commercial transport. Our involvement spans the cockpit, exterior, and cabin. Our product range includes the lights you see on the exterior of an airplane, such as flashing white, red, and landing lights. If you are in the cabin and turn on the reading light above your seat in planes like the 737 or 777, that's our assembly. In the cockpit, there are numerous lights and indicators, and we partner with major avionics companies to supply these components for aircraft cockpits. I would say that we are one of the largest aircraft lighting companies globally. When we consolidate all our lighting efforts, we rank among the largest suppliers. The competitive landscape for our lighting products, along with other product lines, has shifted due to consolidation within the industry over the past 10 to 15 years, positioning us as a leading independent supplier to major original equipment manufacturers. This has proven advantageous for us, and I hope it continues, as it differentiates us by being large enough to meet customer needs but small enough to respond promptly and effectively. The aerospace sector, like many others, relies heavily on reputation, and we have been gaining market share. We are optimistic about our progress, as we consider our business to revolve around four strategic focuses, with this being one of them.

Got it. That's very helpful. Maybe just a quick follow-up on that. I mean, and I know it may be difficult to estimate. But when you think about your market share and sort of the main players that you're up against, particularly maybe in terms of the military segment, are there any data points you have there that might be worth helping us to understand the company a little better?

Well, we do the exterior lighting suite on the Joint Strike Fighter, the F-35, for example, that's a high-volume, high-value program, and we have a big portion of it. We are not active in the cockpit, and there's a story there back in the day, there were international work share arrangements, so we were kind of precluded from that. But that would give you an example of what we're involved with.

And our next question is a follow-up from Jon Tanwanteng from CJS Securities.

I was wondering if you could walk through your cash flow expectations for the year, especially as we head into Q1 and as revenue may decrease and you collect on receivables. Additionally, as your EBITDA increases, what kind of conversion can you expect?

Sure. Pete, I assume you want me to take that one?

Go ahead. We're not in the same place, obviously, for those who are listening.

We anticipate returning to cash flow positivity as we progress through 2024. The beginning might be slow as our top line grows slowly, but by the second, third, and fourth quarters, we expect to generate significant cash flow from operations. Our capital expenditures for the year will increase compared to the pandemic period when spending was cut back. We expect those expenditures to be around $20 million, primarily focused on specific programs and new tooling, as well as testing setups for programs we have secured. While we won't provide specific numbers, we generally do not give guidance on cash flow. However, we do expect a return to significant cash flow generation as the year advances, which will significantly exceed our net income for the year.

Got it. And then any phasing to the CapEx plans as you go through the year?

Yes. It's going to be more heavily weighted toward the back half of the year, I think. But not significant, and it's always a little bit difficult for us to predict specific quarters with the CapEx. A lot of things get moved out. Very rarely does anything get moved in. But I think for modeling purposes, I would probably look at it and it's going to be more or less rounding if you try to break it out separately by quarters. I'd probably just take your model and take the midpoint of our range and divide it by 4, I think.

Okay. Fair enough. And then just finally, obviously, with all the cash flow questions, what's the expectations for a potential refinancing and working down high-cost debt that you have?

As I mentioned, as we return to profitability here and positive cash flow. We'll have more options available to us. I'm not ready to get into those at this point. But obviously, our interest cost is pretty high right now, and our amortization of our term loan eats up a lot of cash. So we're going to continue to look at the alternatives and the best options for us as we move through the year here.

Our next question comes from Ryan Michaelmene with Mann Group. Please go ahead.

Great job on the quarter. I want to ask about a follow-up regarding FLRAA. We listened to the Textron call recently, and they had some really positive updates. It seems like things are progressing well there. Could you provide an overview of FLRAA and any additional updates? I know you discussed the electrification of the aircraft and mentioned your comparative advantage in that area. It would be helpful to hear how that program could positively impact you.

It's going to be a really important program long-term for our company. I believe it has the potential to be the single largest program we've ever undertaken. A lot of that is due to the shipset content we're developing, which is based on proven architectures, making it relatively low risk. The shipset content should be substantial, but it's still evolving, so it's too early to finalize. For example, if we consider a theoretical wide-body airplane and imagine all the potential components—though such an airplane has never existed—an antenna on top, a complete lighting suite for the exterior escape path, a full load of PSUs, and an entire suite of our IFE equipment could total around $750,000 in terms of our content. The figures we're discussing for FLRAA are significantly higher than that, representing a pretty substantial opportunity for us. We've surprised some in the industry with our ability to execute this program, as we are managing the entire electrical system from generators to end-use systems, including electronic circuit breakers and much of the switching. Planning for what the aircraft might need over 30 or 40 years is quite a challenge. However, Bell has proven to be a great partner for us. We've worked together on their 505 and 525 models, and we developed their FLRAA prototype before FLRAA itself. We know their organization well, and they are familiar with us. I believe this will be a fantastic program, one that the Army truly needs.

That gives a solid overview. We've been discussing this topic quite a bit. From a high-level perspective, could you share your insights on the customer discussions regarding in-flight entertainment and retrofitting cockpits in commercial transport? What are the customers expressing they want in terms of long-term plans? Any thoughts on this?

Yes, I'd say the biggest trend that we see is that narrow-body operators around the world are adapting in-seat power in a way that they never really have before. It's a trend that was very helpful to us as we navigated through the pandemic as well as we did, but it's just picking up speed. So we developed a system largely in the pandemic or as the pandemic was beginning that we're partnered with Southwest Airlines, they were the target customer, and there was a lot of back and forth, and we've developed a system on our dime, with our IP that they endorsed and so far have agreed to put on their MAX fleet. There's an NG portion of that fleet that I expect we'll be talking about sometime also here in the near future. But it turns out that Southwest's desire and the kind of the unique architecture of the system has found a lot of favor all around the world from India to China, Europe. So we're booking a lot of orders there, and that will be a major driving force for us in the IFEC world for a long time. The other trend I would say that's positive is that connectivity is getting better and more ubiquitous, not less. And we are involved in that in a number of ways also with some of the leading connectivity suppliers. Some of them are a little more reluctant to let us use their name than others, which is their right. But we're pretty active in that space. So that's also, I think, a positive trend that's going to serve us well for quite a while.

And then lastly, anything with litigation on sort of what you guys have talked about in the K? Anything update there, what's going on? I know we talked about it a little bit before, but anything incremental?

Well, we have a long-running dispute with Lufthansa Technik that has been going on for more than a decade. Not much going on these days. There are little things happening here and there, but that's likely to pick up as we get towards the end of 2024. And there's a chance and I will dare say a chance that those things get resolved in 2025, which would be kind of nice. That would be a change. As far as the Teradyne suite in our Test business, we actually got a very favorable ruling in December where we basically won on all counts. But of course, as these things go, either side has the right to appeal, and we understand that Paradigm intends to appeal. So the orbit that takes is a little bit unpredictable. It's probably something that will play out in the middle of 2024. But it shouldn't be at least to begin with as expensive as what we've been through because all the fact-finding has been done. So we'd hope for a little bit of a break there in terms of expense, but we won't know until we get there.

Thank you. And ladies and gentlemen, this concludes our question-and-answer session and today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, and have a wonderful day.