Matt [Analyst]'s questions to TAT Technologies Ltd (TATT) leadership • Q1 2025
Question
Matt [Analyst] inquired about the sources of recent business growth, the drivers behind gross margin expansion, the company's strategy for managing persistent supply chain issues, and its current operational capacity.
Answer
Executive Igal Zamir clarified that growth stems from a mix of new and existing customers across various business lines. He attributed the significant margin improvement to major operational efficiency initiatives, not pricing, stating a long-term goal of at least 25% gross margin. To counter supply chain volatility, Zamir confirmed a strategic increase in inventory, viewing it as a competitive advantage that ensures high service levels. He also stated that due to past investments, TAT has the facility and equipment capacity to more than double its output, with the supply chain being the primary constraint.