Scot Deuschle

Scot Deuschle asked if the current corporate cost level of $85 million is sustainable for next year, or if it is expected to increase with the integration of PSI and other factors.

Answer

Max Mitchell, Chairman, President, and Chief Executive Officer, stated that corporate costs are not expected to grow next year. He anticipates leveraging growth to bring the corporate cost percentage closer to 3% of total revenue.

Scot Deuschle asked for details on Process Flow Technologies' (PFT) benefits from power and data center demand, and if Crane has content on smaller reciprocating engines. He also inquired about organic investments at PFT to increase chipset content on the AP1000 and if it could become a larger driver, and later followed up on the F-16 brake retrofit program's revenue target, Aerospace & Electronics' organic growth acceleration for next year, and the corporate cost outlook.

Answer

Alex Alcala, EVP and COO, stated that PFT's power segment, primarily U.S.-based and less than 10% of the portfolio, benefits from investments in natural gas combined cycle plants, with Crane participating via its valve portfolio. He confirmed no content on smaller reciprocating engines. Max Mitchell, Chairman, President, and CEO, affirmed that long-term efforts are aimed at gaining AP1000 content, with technology investments underway to penetrate pressurized water reactors and identifying a 30% increase in content. Alcala confirmed the F-16 brake retrofit program is on track for a $30 million revenue target in 2026 with no base revenue in 2025. For Aerospace & Electronics, Alcala expects organic growth at the high end of the 7-9% long-term algorithm, while Mitchell noted commercial OE is positive but aftermarket pace is an unknown. Mitchell also stated that corporate costs are not expected to grow next year, aiming closer to 3% of revenue.