Alexandra Mandery

Alexandra Mandery inquired about HEICO's PMA portfolio exposure to new engine entrants like LEAP, GTF, and GE9X, and if first-time shop visits for these engines present an opportunity. She also asked for additional color on general trends in the Electronic Technologies Group (ETG), particularly regarding space and defense tech, and where bookings are headed.

Answer

Victor Mendelson explained that new engines under warranty are not a significant PMA opportunity but may offer repair opportunities as platforms age. He affirmed HEICO's technical capability for current and next-generation engines. For ETG, he reiterated optimism for various markets, including space and defense tech, emphasizing HEICO's focus on profitable opportunities and alignment with government priorities for speed and cost-effectiveness.

Alexandra Mandery asked for Karman Space & Defense's 2026 margin guidance, specifically if EBITDA margin expansion is anticipated and what range to expect. She also inquired about any impact of the government shutdown on bookings and the first quarter of 2026.

Answer

CFO Mike Willis stated that Karman targets 50 basis points of EBITDA margin expansion annually from operating leverage, and while not formal guidance, they expect to achieve this going forward. CEO Tony Koblinski confirmed no impact to 2025 and currently no impact to 2026 from the government shutdown, though meetings and solicitations are being delayed.

Alexandra Mandery asked for Karman Space & Defense's margin guidance for 2026, specifically if EBITDA margin expansion is anticipated and within what range. She also inquired about any impact of the government shutdown on bookings and the first quarter of 2026.

Answer

CFO Mike Willis stated that Karman Space & Defense targets 50 basis points of EBITDA margin expansion per year from operating leverage, though this is not formal guidance for 2026. CEO Tony Koblinski reiterated that as of now, there is no impact to 2025 or 2026 from the government shutdown, despite some meetings and solicitations being delayed.

Alexandra Manderi inquired about Curtiss-Wright's growth trajectory for end markets and expected margin expansion in 2026.

Answer

Chair and CEO Lynn Bamford expressed confidence in driving growth across all three segments in 2026, citing positive market dynamics in commercial aerospace, defense spending, and nuclear. She anticipates exceeding 2024 investor day targets and committing to faster operating margin expansion. VP and CFO Chris Barker reiterated excitement for future prospects, with specific 2026 guidance expected on the Q1 2026 call.

Alexandra Eleni Mandery of Truist Securities questioned a $3.1 million legal fee on the cash flow statement related to an unsolicited acquisition offer and asked for the company's outlook on potential Department of Defense (DOD) budget changes.

Answer

Executive Suman Mookerji explained the legal fees were for advisors responding to an unsolicited offer from Albion River, which has since divested its stake, and these costs are not expected to recur. CEO Stephen Oswald reiterated confidence in Ducommun's diversified defense portfolio, stating they feel well-positioned despite potential budget shifts, with the F-18 wind-down already factored into their baseline.