Question · Q4 2025
Tusa inquired about the company's confidence in avoiding future negative EAC (Estimate at Completion) charges, particularly after resolving CH-53K issues. He also asked if the 13% underlying margin for AEC is a reasonable run rate for 2026 and sought clarification on how the Amelia Earhart Facility's 10% margins and CH-53K's performance impact the rest of the AEC business's margin profile.
Answer
Gunnar Kleveland, President and CEO, stated that a large charge was taken in Q3 to de-risk the CH-53K program, which is now performing to expectations, and no large EAC charges are expected for the rest of the year. Will Station, CFO, confirmed that a 13% underlying AEC margin is a reasonable run rate until the Salt Lake strategic review is complete. Station clarified that the CH-53K program will not incur future losses due to the Q3 charge, and the goal for the remaining AEC business is to achieve mid-to-low teens margins, contingent on resolving the Salt Lake strategic review.
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