Tony Bancroft

Tony Bancroft asked about Ducommun's ability to keep up with growth given a potential $1.5 trillion defense budget, specifically regarding existing capacity and potential new opportunities or adjacencies. He also asked if the company considers overcapacity in its planning.

Answer

Stephen Oswald, Chairman, President, and CEO, highlighted strong relationships with defense primes, sole-sourcing on many programs, and ample existing capacity (at least 30% in factories) in the Midwest for Electronic Systems, which can be supported by regular CapEx. He also mentioned building relationships with new warfare programs and companies like GA to take advantage of new opportunities, emphasizing that the defense business is expected to grow stronger and bigger.

Tony Bancroft questioned Ducommun's ability to keep up with growth given a potential $1.5 trillion defense budget, asking about capacity management and potential overcapacity. He also explored whether the company would pursue adjacencies or other new areas to capitalize on new opportunities arising from such a significant budget.

Answer

Stephen Oswald, Chairman, President, and CEO, emphasized Ducommun's strong relationships with defense primes like RTX and Northrop Grumman, and its critical, often sole-source, supplier role. He reiterated the company's significant existing capacity (at least 30%) in Midwest Electronic Systems facilities, manageable with regular CapEx, and mentioned ongoing efforts to build relationships with new warfare programs like Collaborative Combat Aircraft (CCA) and hypersonics.

Tony Bancroft asked a high-level, strategic question about Ducommun's long-term vision beyond the current Vision 2027 plan, inquiring about the 'next leg' of growth and how management envisions the company's broader evolution.

Answer

Chairman, President & CEO Stephen Oswald responded with a 'go, go, go' mentality, stating the long-term strategy is to continue building the portfolio with a higher mix of engineered products and aftermarket content. He emphasized that this is a 'ten year play' that also involves continuous cost reduction and value pricing within its niche contract manufacturing business, with a new long-term vision to be presented in the future.

Tony Bancroft inquired about the potential impact of the proposed $1.5 trillion defense budget on HEICO's business, even if not fully realized. He also asked for HEICO's overall view on recent Department of War programs like 'Dome Dominance' and 'Arsenal Freedom,' and any direct communications or insights from the Department of War regarding these initiatives.

Answer

Victor Mendelson, Co-Chairman and Co-CEO, stated that increased defense budgets and multi-year government buys are 'definitely beneficial' for both the Electronic Technologies and Flight Support Groups, providing positive impact and potentially contributing to current backlogs. Regarding 'Golden Dome' (referring to Dome Dominance), he noted that it consists of many existing missile defense programs where HEICO is a supplier, and also includes newer tracking and reconnaissance parts. He confirmed that HEICO is told some of its sales are for Golden Dome, and that defense tech companies are participating in various ways, which HEICO is picking up.

Tony Bancroft with Gabelli Funds asked about the broad impact of proposed defense budget increases and Department of War programs, such as 'Golden Dome,' 'Dominance,' and 'Arsenal Freedom,' on HEICO's business, and what HEICO has been told regarding these dynamics.

Answer

Co-Chairman and Co-Chief Executive Officer Victor Mendelson viewed increased defense budgets and multi-year buys as beneficial, providing impact and benefit to backlogs for both the Electronic Technologies and Flight Support Groups. He noted HEICO's participation in existing programs related to 'Golden Dome' and new tracking/reconnaissance parts, as a supplier layer down, confirming that both dynamics are positives for HEICO.

Tony Bancroft asked if the Ethos acquisition, which has adjacencies but is somewhat outside HEICO's traditional M&A scope, signals a new outlook on expanding into other high-growth areas beyond typical aerospace adjacencies, especially given the strong defense budget.

Answer

Eric Mendelson clarified that HEICO has been in the Industrial Gas Turbine (IGT) area for decades, viewing Ethos as an adjacent white space where they understand the technology and can add value, noting some IGTs are aeroderivatives. Victor Mendelson added that HEICO's history involves carefully expanding into such adjacencies, always connected to existing operations, resulting in a vastly expanded product offering over time.

Tony Bancroft asked about the Ethos acquisition, noting it's somewhat outside HEICO's traditional M&A scope but with adjacencies, and inquired if this signals a new outlook on aerospace or other high-growth areas, particularly given defense budget strength.

Answer

Eric Mendelson explained that HEICO has been in the Industrial Gas Turbine (IGT) area for decades and views Ethos as growing into an adjacent 'white space' where they understand the technology and operations. Victor Mendelson added that this careful, intentional expansion into new adjacencies has been HEICO's historical approach since its early days, always connecting new ventures to existing operations.

Tony Bancroft inquired about HEICO's preferred areas for M&A and the thought process behind its successful acquisition strategy.

Answer

Co-CEO Victor Mendelson emphasized an opportunistic approach, seeking great businesses even in adjacent spaces. Co-CEO Eric Mendelson added that HEICO's decentralized structure and deep expertise allow it to evaluate and integrate acquisitions effectively, making it an attractive home for sellers who want to continue building their business.

Tony Bancroft asked about Curtiss-Wright's observations regarding supply chain improvements or difficulties, contrasting major OEM commentary with challenges further down the supply chain. He also inquired about potential M&A opportunities that would be accretive by internalizing supply chain capabilities.

Answer

Chair and CEO Lynn M. Bamford stated that Curtiss-Wright's supply chain remained fairly stable in 2025, with ongoing watch items like high-bandwidth memories, storage parts, and rare earths. She highlighted the company's implementation of new tools, centralized resources, dual-sourcing strategies, and leveraging government high priority ratings to manage the supply chain effectively. She noted that M&A for supply chain internalization is not currently a high priority, but would be considered if it offered strategic benefits like global diversification or localization for specific end markets.

Tony Bancroft asked about Curtiss-Wright's observations regarding supply chain improvements or difficulties, particularly in the context of commercial OEMs, and whether there are M&A opportunities to internalize supply chain capabilities for accretion.

Answer

Chair and CEO Lynn Bamford stated that Curtiss-Wright's supply chain remained fairly stable in 2025, though watch items include high-bandwidth memories, storage parts, raw materials, and rare earths. She highlighted the company's robust supply chain management tools, centralized resources, dual-sourcing strategies, and leveraging of government high-priority ratings. Ms. Bamford indicated that M&A for supply chain internalization is not a high priority but could be considered if an opportunity arose for global diversification or localization to better align with end-market demands.

Tony Bancroft asked for a high-level prioritization of Curtiss-Wright's four strong growth businesses for CapEx allocation and M&A focus, given their secular tailwinds.

Answer

Chair and CEO Lynn Bamford stated that CapEx and M&A priorities have centered on aerospace & defense and commercial nuclear markets, where the company sees strong growth and differentiated technologies. She emphasized the intertwined nature of the businesses, where investments in one technology (e.g., electromechanical actuation) often serve multiple end markets, citing flight data recorders as a prime example.

Tony Bancroft of Gabelli Funds asked for an overview of Curtiss-Wright's M&A priorities across its various business segments.

Answer

President, CEO & Chair Lynn Bamford identified Defense Electronics as the highest priority for M&A, where the company can leverage its global reach and expertise for bolt-on acquisitions. Other priority areas include major naval and aircraft safety systems and commercial nuclear. She noted that commercial aerospace and industrial are lower priorities, emphasizing a focus on differentiated technology and the benefit of diversification in being selective.

Tony Bancroft asked if the company's view has changed on pursuing a more transformational acquisition, given its strong balance sheet, positive outlook, and active M&A pipeline.

Answer

CEO Lynn Bamford responded that while the company remains open to larger acquisitions, any potential deal must be balanced against the management bandwidth required to execute on the significant organic growth opportunities already in front of them, particularly in commercial nuclear and defense electronics. This need to focus on execution slightly shades her thinking but does not take larger deals off the table.

Tony Bancroft with Gabelli Funds asked for thoughts on self-driving garbage trucks further down the road, including their potential for safety improvements and addressing driver tightness.

Answer

Ron Mittelstaedt (President and CEO) acknowledged the potential for self-driving technology in the waste industry but emphasized the catastrophic nature of garbage truck accidents. He believes professionals would still be needed in the cab for reactionary scenarios, similar to airline pilots, and sees it as 'quite a ways out.'

Tony Bancroft asked about the long-term potential of self-driving vehicles in the waste industry, considering automation and AI, and their implications for safety improvements, efficiency, and addressing driver tightness.

Answer

Ron Mittelstaedt (President and CEO) acknowledged that self-driving technology exists and could potentially occur in the waste industry. However, he expressed skepticism about fully driverless operations due to the catastrophic nature of garbage truck accidents, suggesting professionals would likely remain in the cab for safety, similar to airline pilots. He views it as 'quite a ways out' but something they will monitor.

Tony Bancroft asked for a detailed explanation of FlackTek's addressable markets and adjacencies, seeking insight into the scope of markets Graham Corporation aims to be in over the next five to ten years.

Answer

President and CEO Matt Malone explained that FlackTek's advanced mixing technology naturally blends with Graham's turbomachinery and vacuum/heat transfer expertise. He highlighted FlackTek's market-agnostic, differentiated technology with five product SKUs, expanding into medical, personal care, and battery technology. Malone emphasized Graham's focus on technology-driven solutions, aligning with market trends like electrification and automation, positioning FlackTek as a disruptive replacement for less advanced mixing methods.

Tony Bancroft sought a deeper understanding of Graham Corporation's addressable markets and potential adjacencies, particularly how FlackTek's technology fits into a 5-10 year vision for new growth platforms.

Answer

Matt Malone, President and CEO, explained that advanced mixing (dual asymmetric mixing) is a natural blend of turbomachinery and vacuum/heat transfer, coupling well with Graham's engineering know-how. He highlighted FlackTek's market-agnostic, differentiated technology with disruptive potential across existing end markets (defense, space, energy, process) and new ones like medical, personal care, and battery technology. Malone emphasized aligning with future technology trends like electrification, advanced controls, and automation, positioning FlackTek as a replacement for less advanced mixing methods.

Tony Bancroft of Gabelli Funds referenced recent news about submarine maintenance backlogs and asked about Graham's long-term strategy to compete and grow in this environment, including potential transformative actions.

Answer

President & CEO Matthew Malone outlined a multi-phased strategy. He emphasized that the first priority is executing on the existing backlog. The second phase involves internal investment and creative solutions to enhance speed and efficiency. The final phase is to leverage this proven capability and capacity to absorb additional work, driven by the business development team, to meet the Navy's needs.

Tony Bancroft of Gabelli Funds asked about the long-term outlook for submarine maintenance given dry dock backlogs and how Graham plans to compete and grow in what appears to be an environment of unconstrained secular demand.

Answer

President & CEO Matthew Malone outlined a strategy focused on execution of current programs, internal investment to enhance speed and efficiency, and leveraging the resulting capacity to absorb additional work. He emphasized that this positions Graham to augment its capabilities to meet the evolving needs of its customers and the U.S. Navy.

Tony Bancroft of Gabelli Funds asked about the long-term outlook for the submarine industrial base, particularly regarding dry dock capacity issues, and how Graham plans to compete and grow in that environment.

Answer

CEO Matthew Malone outlined a multi-faceted strategy focused on execution, efficiency, and expansion. He emphasized flawlessly executing on current programs, making internal investments to enhance speed and efficiency, and then leveraging that increased capacity and bandwidth to absorb additional work and meet the growing needs of the U.S. Navy and its prime contractors.

Tony Bancroft of Gabelli Funds asked for an update on the significant increase in U.S. Navy shipbuilding demand and whether Graham Corporation has the capacity to keep up with this growth.

Answer

President & COO Matthew Malone affirmed that Graham is prepared for the increased demand. He highlighted key investments in efficiency, such as automated welders, and noted that the new Batavia facility is designed with infrastructure for future expansion. Malone also mentioned the proactive acquisition of adjacent land at the Barber-Nichols location to ensure the company remains 'shovel ready' for additional capacity needs.

Tony Bancroft of Gabelli Funds asked about Graham's potential exposure to the large supplemental defense budget being discussed in Washington, as well as the potential downside risk from a continuing resolution (CR) and subsequent budget cuts.

Answer

CEO Daniel Thoren responded that while it's difficult to trace the direct impact of top-line budget changes, Graham feels well-positioned due to its involvement in high-priority, strategic U.S. Navy programs that are often funded years in advance. He reasoned that a supplemental budget would likely relieve pressure on all programs, whereas a CR would probably impact less strategic programs more severely, though he could not predict the specific effect on Graham.

Tony Bancroft asked if the recently announced transaction between Baker Hughes and Chart Industries could potentially accelerate the closing timeline for Crane's acquisition of PSI from Baker Hughes.

Answer

EVP & CFO Rich Maue provided a direct response, stating that there is no change to the expected timeline. He confirmed that the company still anticipates the PSI transaction to close at the end of the year, around January 1.

Tony Bancroft asked for management's perspective on how the broader geopolitical tariff situation might play out for the aerospace industry, referencing comments from China and France, even if the direct impact to Crane is mitigated.

Answer

Chairman, President and CEO Max Mitchell expressed optimism, stating that while it's anyone's guess, he believes the issues will get resolved. He emphasized that the global environment is too important for trading partners to disrupt long-term and that a resolution will be very positive for everyone moving forward.

Tony Bancroft of Gabelli Funds asked about Crane's long-term strategy post-portfolio transformation, specifically questioning if the company would consider larger, more transformational M&A beyond its typical sweet spot.

Answer

Chairman, President and CEO Max Mitchell affirmed that the company's strategic planning considers all scenarios, including larger opportunities. While emphasizing that any deal must make strategic sense and be integrable, he stated they have looked at larger assets and would not rule out using equity as currency for the right opportunity. He concluded that they will continue to explore all avenues, including larger synergistic deals, to drive shareholder value.

Tony Bancroft asked for an update on Crane's long-term 2028 plan to scale its two core businesses and also requested the latest thinking on a potential sale of the Engineered Materials business.

Answer

CFO Rich Maue confirmed there is no change to the long-term financial targets for A&E and PFT. CEO Max Mitchell added that the M&A funnel is 'very full' and activity has 'never been higher,' supporting the scaling strategy. Regarding Engineered Materials, he reiterated that the business is not strategic and that the company 'will not miss the next cycle' to sell it when the timing is right.

Tony Bancroft of Gabelli Funds asked about the company's M&A strategy, including the possibility of transformational deals outside its core business, the potential use of stock in transactions, and the remaining pipeline of large operators in the Northeast.

Answer

CEO John Casella affirmed that Casella will stick to its core competency and is not pursuing transformational deals, instead focusing on its $500 million pipeline of opportunities along the Eastern Seaboard. Executive Ned Coletta noted the company has $900 million in available liquidity for its near-term pipeline but remains opportunistic about using a mix of debt and equity for the right deals. Casella reiterated that nothing transformational is currently being considered.

Tony Bancroft of Gabelli Funds asked about Casella's broader M&A strategy, including its appetite for transformational deals outside its core business, the potential use of stock in transactions, and the remaining opportunities in the Northeast.

Answer

CEO John Casella affirmed that the company will stick to its core competency in the solid waste sector along the Eastern Seaboard, where it has a pipeline of about $500 million in opportunities, and is not currently considering transformational deals. Executive Ned Coletta added that while the company has $900 million in available liquidity for its near-term pipeline, it remains opportunistic about funding structures, including equity, for the right deals.

Tony Bancroft of Gamco Investors asked for management's thoughts on the potential for larger, transformational M&A, given the company's recent success with rapid growth and integration.

Answer

CEO John Casella responded that while the company's primary strategy remains focused on tuck-in acquisitions along the Eastern seaboard, they would not rule out a larger opportunity if one became available. He and President Ned Coletta emphasized that their core focus is on enhancing their integration capabilities and maintaining a unified company culture through significant investments in training facilities and programs to support their substantial growth in headcount.

Tony Bancroft asked about Republic Services' long-term growth potential, the possibility of transformational initiatives, and what concerns the CEO most in the current environment.

Answer

CEO Jon Vander Ark outlined a multi-faceted growth strategy based on gaining share in the Recycling & Waste and Environmental Solutions markets, supplemented by a third growth engine in sustainability innovation. He emphasized that growth will come from organic initiatives, pricing, and M&A. While the business is recession-resilient, he acknowledged that the macro environment is the primary external factor they monitor, but they remain committed to investing through the cycle.

Tony Bancroft asked about the potential for another transformational acquisition in the future, possibly in sustainability, similar to the successful Environmental Solutions deal.

Answer

CEO Jon Vander Ark stated that while the company evaluates all opportunities, its strategy is not dependent on a large, transformational deal. He emphasized that the primary focus remains on driving value through small- to medium-sized acquisitions and strong organic execution, though they would consider a large opportunity if one arose.