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spk00: Good day and welcome to the Innovative Solutions and Support Third Quarter 2021 Earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star, then zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Mr. Jeffrey Hedrick. Please go ahead.
spk03: Good morning. This is Jeff Hedrick. Welcome to our conference. third quarter of fiscal 2021. Current business conditions and outlook for the coming year. Joining me, our chair, I'm asking for our president and our CFO. Before I begin, I'd like to read the safe harbor message.
spk02: The President Thank you, Jeff, and good morning, everyone. I would remind our listeners that certain matters discussed in the conference call today including new products and operational and financial results for future periods, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ maturely, either better or worse, from those discussed, including other risks and uncertainties reflected in our company's 10-K, which is on file with the SEC, and other public filings. Now I'll turn the call back to Jeff.
spk03: over year, as well as significantly on a sequential basis, with backlog increasing over 40% in the last three months. Margins remain strong, and we have one of the best cash flow and bottom line profitability quarters in quite some time. Results were once again driven by a balance of OEM and retrofit programs and reflect the a range of various products. We believe this strategy both diversifies markets and products and will provide a strong foundation for continued growth. In a sign of emerging rebound in general aviation, Textron Aviation reported the delivery of 33 turboprops in the second quarter. more than double the 15 delivered in the same quarter a year ago. They also noted that new equipment or activity continues to be strong and appears to be sustainable. That result has been a strong demand for the King Air 360 and King Air 260 with our auto throttle on the production aircraft. We are pleased to be working with some of the most respected names in the aviation industry, Textron, Boeing, Pilatus, and others. Cover story in a recent issue of Flying Magazine prominently mentioned the ThrustSense technology. In a previous issue, we were selected by Flying Magazine as an Editor's Choice finalist, selecting three of the most innovative companies for that year. Among those three companies were SpaceX for landing their booster rocket on an island in the North Atlantic, Garmin for automatically landing its five It's a single-engine airplane. And ThrustSense, our autothrottle, is one of the three most innovative products. In the most recent issue, Flying Magazine mentioned our ThrustSense technology and its application in the King Air 360. The IS&S full regime The stuff says provides most remarkably VMCA protection. That VMCA is, in fact, the loss of control of a twin-engine airplane when you lose the engine, a one engine. This has been a problem for 100 years. in multi-engine airplanes and even singles. We're especially pleased that the industry has embraced our auto-throttle technology. The product is covered by multiple U.S. and foreign patents and provides full authority digital engine control protection for existing installed engines on a retrofit basis. The revolutionary feature is the protection against fatal loss of control actions, in which a loss of an engine causes the airplane to, I'm sorry, causes the pilot to lose control of the airplane, causing it to flip on its back and crash. I was pleased that we also noted that in an order for 11 state-of-the-art cockpit IP primary flight navigation systems for a premier online retailer that is upgrading its purchased 767 Boeing aircraft in response to expanding demand of air cargo operations. and these aircraft provide a cost-effective ease of entry for legacy areas, also for newer operators initiating or expanding their air cargo platform. While revenues are growing with an increase in demand for aircraft on which we can have long-term production contracts, we are also seeing strong demand for our legacy and retrofit products. remains robust as represented by previously mentioned order from a well-known airline retailer. This is very good business, utilizing our standard flat panel displays, requiring only minor modifications as required. We continue to book orders and add to our backlog. We continue to supply Eclipse with contracts additional needs, and we are currently discussing those needs with them. The first one in nine months of the year have been very good as the effects of global pandemic were moderated. Nonetheless, we remain vigilant in watching for any signs of conditions that change, including any impact on our supply chain. With a strong order of and momentum building, we feel that we've reached an inflection point. The goal is to leverage the success for future growth and build value for our shareholders.
spk02: I'd like to turn it over to Raoul. Thank you, Jeff, and thank you all for joining us this morning. Looking at the third quarter, revenues were $6.2 million, an increase from $6 million the same quarter a year ago. but also up over $1 million sequentially from the $5.1 million in revenue in the second quarter of this year. As Jeff mentioned, we are building momentum in the business. Revenues were generated primarily from our OEM production contracts, including the PC24 and King Air auto throttle programs, followed by sales in our air cargo customers. Gross margins for the quarter were 54 percent, consistent with our historical and recent margins. Total operating expenses for the second quarter of fiscal 2021 were $2.2 million, unchanged from the year-ago quarter. Research and development expense decreased from the year-ago quarter, primarily due to the transition of programs from primarily STC development and certification to production. Research and development expense was almost 11% of our quarterly revenues, reflecting continued strong commitment to innovation, So, in general, administrative expenses were up from the year-ago quarter as a result of an increase in headcount and professional fees. We've selectively added to our organization to support current and anticipated growth. We continue to emphasize tight operating cost controls and currently believe current quarterly operating expense levels will be maintained in the current range for the balance of the year. With a quarter, operating income was unchanged from a year ago at $1.2 million. We recognize a non-cash $1.5 million or $0.09 per share tax benefit in the quarter. In the June 30, 2021 quarter, valuation allowances were released for all federal and most state deferred tax assets. The company continues to be in a three-year cumulative income position as well as continuing to have future foreclosures Net income was $2.7 million or $0.16 per share in the quarter, up from $1.3 million or $0.07 per share in the year-ago quarter. The company remains in a strong financial position. Cash flow from operations was $1.5 million in the quarter and $3.8 million on a year-to-date basis. Despite the payment of approximately $20 million in dividends this fiscal year, we've ended the period with cash and equivalents of $7.5 million. to take a deposit for an order from a customer which added to cash and also correspondingly recorded in our current liabilities. This order is expected to be completed by fiscal year end. We anticipate being operating cash flow positive for the full year. The company is debt free. Consequently, we believe the company has sufficient cash to fund operations for the foreseeable future. Now I'd like to turn the call over to Sharon.
spk01: Thank you, Rail, and good morning, everyone. This was a rewarding quarter as we grew our revenues and increased our backlog, both indications that the demand for our products is increasing. The increased demand is from many sectors of the market, air cargo and general aviation, and for both OEM production and retrofit products. So let me provide additional information around some of our revenue-generating programs that are driving our success. On the production side, we have mentioned that we have three foundational OEM products that we expect to generate recurring revenues over the next several years. The Pilatus PC24 program is continuing to grow as Pilatus steadily increases their production volumes for this successful aircraft. Our government contract on the KC-46 continues to run at expected production rates. We're also seeing interest from Boeing for additional systems for export. The conditions in the general aviation market are improving and Textron noted the shortage of available used aircraft is driving demand for new aircraft. As a result, we are experiencing increased production rates for our Kingair ThrustSense autothrottle. Consequently, in addition to providing a stable base of recurring revenue on the OEM side, our autothrottle production line is also becoming a growth engine on the aftermarket side with Textron. We expect to rebound in this market to generate increased activity in the general retrofit market for the King Air as well as the PC-12 autothrottle through our other dealer and maintenance center networks. As previously articulated and as illustrated in the article by Flying Magazine, our autothrottle is getting a lot of attention and therefore is the focus of our research and development efforts. Growth potential is very strong in many different markets and we are in the process of responding to requests from OEMs for additional order flow platforms. Despite overall market sluggishness in the air transport sector, we are having success in the retrofit market by serving the growth demand for cargo capacity. One high-profile program is a contract we announced with a well-known retailer that continues to grow the Boeing 767 fleet and is retrofitting the cockpits with our display system. But the growth of online shopping has attracted a host of other players into the market as well and a fast way to build air cargo capacity is through a 757 or 767 conversion. With over 1,000 Operational 75 and 767 available for cargo conversion. We expect to see our flat panel display business remain strong. New orders in the third quarter of fiscal 2021 were 9 million. That is a steady increase from 7.6 million in the second quarter and brings our total new orders for the year to 22 million. Backlog as of June 30 was $9.5 million, up $2.8 million from the end of last quarter. Safety protocols throughout our industry, from those at the FAA to those restricting travel to certain countries, have been an obstacle we have had to navigate in our business development efforts. In addition, as Jeff noted, they also have added complexity to the supply chain that burdens our production process. Fortunately, we have managed to successfully negotiate these challenges by anticipating potential issues and have minimized their impact on our business. This has us confident in our future as we believe the eventual relaxation of COVID-19-related restrictions will provide our business a healthy tailwind. Before turning the call back to Jeff, let me quickly applaud the ongoing efforts of our employees to integrate new safety protocols into our standard operating procedures, and which has enabled us to maintain productivity without jeopardizing their health, safety, or well-being. I'd now like to turn the call back to Jeff for some closing remarks.
spk02: Thanks, Sharon.
spk03: It was a real strong third quarter. Earlier this year, we distributed nearly $20 million in dividends to our shareholders. And we now have been building our momentum across the business to reward our loyalty even further. We've increased our cash flow. We expect this momentum, a recovery market, and a strong balance sheet, and a growing backlog to lead to continued success. Operator, please turn this over for questions.
spk00: We will now begin the question and answer session. To ask a question, you may press star, then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster. Our first question comes from David Campo with Thompson, David and Company. Please go ahead.
spk04: Hey, Jeff. Hey, congratulations. What a quarter.
spk03: Good morning.
spk04: How are you? It's finally coming through. I'm looking for it.
spk03: Look, we have a good situation. the supporter, things are starting to all come together. We survived the pandemic happily, so we're not in a recovery mode, but rather a continued operations mode. I give the entire team incredible credit. But importantly, this retailer we're talking about will probably build a fleet of over 500 aircraft over the next three to five years. And we're happy that he's chosen to put our equipment on the latest conversions and more than 50% of their fleet.
spk04: What about FedEx? They're expanding. They're adding aircraft. Do you have business there?
spk03: and expensive relatively, and they have a reasonable volume. So I think for FedEx and some of the other package carriers, they're focusing on new airplanes from Boeing. Boeing, look at it. You know there's going to be big demand for it. Look at Airbus. Airbus has just announced their 330 cargo, a cargo version of the 330. Right. And so what we believe is we think that we see a number of smaller package carriers seeking the large volume of 767, and that's our cockpit. And the only competitive cockpit takes four times as and has a much lower proven reliability.
spk04: When looking for problems, and I see supply chain problems with some companies, largely because of the shortage of semiconductors, is that likely to impact your deliveries?
spk03: supply chain. We haven't had serious problems yet, but there's two problems in anything that's semiconductor related. Increasingly, the lifetime for a given semiconductor is getting shorter and shorter. They're coming up with new technologies almost every year, which forces the obsolescence of some of the existing technologies. That's always an issue. To date, we haven't had a serious problem. But our designs are materially different than most designs in that we make our designs up of a series of smaller sub-assembly boards such that if we have a problem with a given technology, a given circuit, as an example, which either goes obsolete or you can't get, we're able, instead of modifying an entire system, we can take a small subsystem part of that and modify that readily. And we've been doing this kind of thing for over 30 years. It helps us. It doesn't solve the problem entirely, but it sure does mitigate it. So the simple answer is we're watching it. But to date, we've been able to manage it very well.
spk04: That's great. That's great. And you'll probably get some Airbus conversion business. Is that a possibility?
spk03: It's a possibility as well. But right now, we're delighted to be focusing on Boeing's 5-7s and 6-7s. As you know, we've got something, 500 or 800 of them done already. And it's been a huge success. The reliability of the equipment is the best that I've ever seen in my career. So we're delighted. We keep our fingers crossed, try to continue to
spk04: Well, based on your momentum and based on the $1.2 million that you earned free tax in the June quarter, I'm estimating you might make $2.5 million free tax in the September quarter.
spk03: You know, I feel like I'm a hurdler. You're running ahead of me in ratios. Listen, you've been a great supporter. We appreciate it. Look, I need to get together with you. Next time you go up to New York, let me know. I'll meet you up there. I'll buy you lunch. I'm being very... You know, we're talking about another potential wave of COVID. God knows what the politicians are going to do. So I think our best bet is to execute on what we got and just keep putting our shoulder to the wheel. If we can grow faster than we have in the past, I'll be delighted. But I'm not planning on it.
spk04: Well, Jeff, I'm not flying around that much as I used to. I'm not coming to New York as much as I used to. The last trip I had to New York was canceled by the host because of the COVID thing. So I suggest you get in your Kinger and fly down to Richmond, and I'll buy you lunch down here. You've got Kinger.
spk03: Last time I came down to see you, I came on a train, and I thought... I know it. I didn't see any lights for two hours. I was scared the hell out of me.
spk04: Anyway, we'll come and see you.
spk03: You're right. We've got an airplane that will get me down there. We've got to do some flight testing anyway.
spk04: Yeah, thank you.
spk03: Thank you, David. It's good talking to you.
spk04: You didn't have the king here the last time you came. Now you've got the king here. There's no excuse. You've got to come down here.
spk03: Yeah, I will. I will come down. You're right.
spk04: All right. I'll let someone else ask questions. Thank you.
spk03: Thank you, David. Good talking to you.
spk00: Our next question comes from George Marino with Creative Ventures. Please go ahead.
spk07: Hey, good morning, guys. Thanks for taking my call. Could you guys comment on the cadence of the retrofit business now on the auto throttle?
spk03: It's much slower than I would like. That's principally because we need to hire salesmen. All the business we have on retrofit now is principally coming through Textron and Textron service centers and upgrades present owners of King Airs through Textron. We now want to directly attack the FBO separate, and we believe that that's a huge opportunity yet untapped. I can only tell you that I've now taken a personal interest in making that happen.
spk07: Okay. And on the OEM business, like Textron, for example, what is the approximate time lag between when you need to ship your product to them for them to put it in their plane and ship their product? Is it a month, three months, six months? How far ahead do they order the autothrottle to put in their plane?
spk03: I honestly can't give you an exact date, but I can tell you six to nine months. Approximate. Because in the production cycle of the airplane, it takes that long. So they phase in the installation of it somewhere in the middle of the manufacturer of the airplane. So it's more determined by how long it takes to build the airplane than it is anything else. And we've been servicing them in many cases in a matter of weeks. And we're building now inventory so that we can deliver in very short lead times for our FBO customers and for Textron.
spk07: Yeah, because looking at Textron numbers, they're planning on producing dramatically more planes in the back half of this year than the first half. That's why I was sort of wondering about that.
spk03: We're already looking at automating certain functions just to be able to get repeatability. Not so much to save labor, but to assure Especially as the volume grows. As a reassurance, the company has a history of growing its revenue very quickly. And during the RBSM period, we increased production rates month over month by two to one. I know you do. It wasn't as bad as it sounded, but we grew very, very quickly. And the company, honestly, the company's always been designed to do that because in the retrofit business, you have to assume that you have a potentially short lead time. And the company is geared to do that. So we're geared to accommodate the rapid growth. We've gotten tons of accolades for the autothrottle, and if you read the latest edition of Climb, it's almost like they said, gee, this is a great autothrottle, and look at what you can fix to it in an airplane.
spk07: Yeah, well, the way Textron's talking, I think you better be ready for a big back half here. About a conference call or two ago, you were talking about a new sort of lighter, lower-cost version of autothrottle, if I have the words right. And I was wondering, is this sort of version, would it be applicable to sort of like a Cessna-type plane, or what kind of plane would that be used for?
spk03: Well, as an example, the immediate target would be the Textron or Beechcraft 58, which is their small light twin that periodically experiences these loss of patrol accidents. It's less critical in some of the smaller airplanes than it is in the King Airs. Yep. But we... possible to deliver 50 to 100 a month for the foreseeable future. That would be a very nice thing if we could do that.
spk07: And I'm assuming that these auto throttles will go on the new remodeled C90?
spk03: They will. That hasn't been It will be a little bit more work to get certification. Not designing it, not applying it, but getting the FAA to approve it. It's approved under a different certification than the 200 and 300.
spk07: And how is the progress on new commercial OEMs and military OEMs?
spk03: Military programs had to take a long time. You know, you sort of start, and it takes two or three years to get them going. But we're progressing in a number of fronts, and we're pursuing that as we speak. There are, as you're aware... a significant number still of turboprop airplanes in the military all over the world. So we continue to bring our technology into those. And to be very blunt with you, if I could find 12 salesmen today, I'd hire them all. Okay.
spk07: Well, man, you might be recruiting me if it's like shooting a fish in a barrel like that.
spk03: I don't know any place where you shoot fish in a barrel, but I'll tell you one thing. It's rewarding, and they do love the product. They just are thrilled. So, I mean, we were... We've really enjoyed this. And we've got a lot of other products. We were at a recent show, and we presented this oil throttle, and they said, oh, by the way, we'd like to take a look at your flight deck upgrades. So we got a dozen people that were inquiring on that. So that's good business, too.
spk07: Yeah, it's great. It sounds like you have a lot of momentum coming, and you're hitting all cylinders here.
spk03: I've been doing this a long time, and nobody ever learned this. I've got to keep pushing on the wheel all of the time, because the minute you take your eye off of it, you find out you've got a very abrupt change in velocity. So far, so good. We're going to keep at it. I'm more concerned about a nice, steady, continuous, and predictable rise in our revenues and when our customers got decimated from the pandemic. So we're optimistic that we will continue to grow now that there's some general recovery.
spk07: Thank you for taking my questions.
spk03: You're more than welcome. Thanks for asking, actually.
spk00: Our next question comes from Michael Friedrich, a private investor. Please go ahead.
spk05: Good morning, gentlemen. Yeah, great quarter. Certainly the new orders and the uptick in that area is very, very encouraging. I just wanted a touch of it. I think the last caller went over most of my questions, but I wanted to just go over some of the things that really weren't touched on. So on current... The current state of the FAA, and I know this is always sort of a moving target, but I believe last quarter I had asked if you guys had any pending applications up there right now. And have there been any approvals during the last quarter that just basically things you didn't bother to or things you didn't let us know about?
spk03: We've gotten some STCs issued. I don't know precisely how many. But I can tell you that I would be more aware of serious problems, and I haven't heard of any serious problems. So that's the good news. To be blunt with you, this is probably as good a working relationship reminds me of the old days when I started in the industry. The FAA has been, in general terms, very, very cooperative and diligent at the same time. So the reality is that they work hard to try to make sure all the work is done, but yet it gets done in a reasonable period of time. Okay. I never thought I would not complain about the FAA, but I can't complain about the FAA. They're doing fine.
spk05: That's awesome. All right, so, Jeff, are there any STCs right now pending that would be for other aircrafts other than the PC-12 or the King Airs?
spk03: Let me think for a minute. I really need to get back on that.
spk05: Yeah, and that would be just on thrust sense, not on any of the other products.
spk03: I would tell you that we're constantly have probably no new aircraft per se because they don't come along too often. but updates to the existing aircraft and making sure that we get the various versions of the King Air done so that we can accommodate, you know, that whole 5,000 aircraft.
spk05: Great, great. So the previous caller had mentioned and touched back on the cheaper version of the press sense that might be available. Is – would there be – I'm guessing there'd be more significant OEM possibilities in that area since there are so many more of those planes that are produced out there. Is that the way you're seeing it, Jeff, or do you believe it'll be kind of in line with the turboprop numbers?
spk03: I can tell you that I've looked at the possibility of coming up with a lower cost, smaller version for application in less expensive aircraft. The King Air is probably, on average, five to seven times the cost of the small twins. So owners don't want to spend a lot of money. At the same time, it's still a critical, it still could be a critical component. And I think people are now recognizing that it's not simply the autothrottle, it's simply a cruise control. That it's a significant and a very valuable reduction in pilot workload. And as that's becoming acknowledged by the people in the industry, The market increases. In the meantime, it took me 17 years to come up with the auto throttle we got. I'm hoping that no one will take one. I don't think I have 17 years left. to fulfill that demand. The good news is we must have almost a half a dozen patents now on the auto throttle, various functions of the auto throttle. And so we have a pretty strong position, I'm happy to say.
spk05: That's great. And, Jeff, did you just say in the past answer that you guys could do 50 to 100 retrofits a month, you know, kind of ideally?
spk03: I'd love to do it. But we need to go out and talk to the MROs. I mean, not only the MROs, but the FBOs, the individual shops all over the country, as well as Textron. Textron's done a great job, but they're even looking now at putting together a dedicated team to do these installations. and a half or a third of the time. So, look, Textron's been as cooperative as any OEM I've ever known. They've been wonderful. And we're working with them. But we want to expand that.
spk05: That's great. That's great. And the online retailer, who we name, we cannot use. Of those 400 planes, I think that they'd have to add, do you expect to be a player on a majority of those? I mean, would those all be seven?
spk03: I would think we will either be on all of them or none of them. Right now, we know we're on... who have a problem. And it's the largest retailer of that kind in the world.
spk05: Yeah, I can take a wild guess.
spk03: We just got to do our job and support them. But it's a unique system in that It's capable of, even if you have any one of the components failure, you can still fly the airplane for 10 days. And that means that if the airplane's in upper Djibouti in the middle of Croatia or something, you know you're going to be able to get it home and service it.
spk05: And that's the best.
spk03: You know, we just kind of do our job and do it well. That's all.
spk05: Yeah, and one more question, and this is more for the people who might be listening today that haven't heard before, but can you just kind of quickly touch, Jeff, on the limited amount of downtime that these planes have when they're having a retrofit, if it was an active plane or a correction as compared to a normal flat panel display switch out?
spk03: a system that's certified for 5767 retrospect. And from what we hear, I mean, our feedback is that it takes about 1,400 man-hours to install it and roughly 30 days. Now, that doesn't become a problem if you're doing a conversion. However, if you actually want to bring an airplane in that has already converted into a cargo airplane, and there's a lot of them, I'm sure, and want to update the cockpit, with our equipment, we've had it done in as little as 24 hours, but traditionally it takes market advantage. There's only two of them that I know that are certified for the 5767. That's great.
spk05: And there's a lower price point for the actual equipment as well, correct?
spk03: I'll just briefly address that. The price point may really not be very important. I know we all think about to even come close to it. You're talking about, you're talking about, you know, orders of magnitude more. And so, now that's not always true because a lot of times it's installed during incredibly reliable. You're talking about 250, 300,000 hours MTPS.
spk05: Fantastic. Fantastic. Well, Jeff, everybody, thanks again. Great quarter. And yeah, things are definitely looking very positive. Hopefully I'll be talking to you again in three or four months.
spk03: Okay. Thanks.
spk05: All right. Take care.
spk00: And our last question for today is a follow-up from David Campbell with Thompson, David and Company. Please go ahead.
spk04: Hey, Jeff. This is David. I've been trying to reach you several times on the telephone and your office number, and No one ever answers it, and I'm not sure you're getting the messages because I guess with the COVID thing, you have a limited staff in the office.
spk03: I'll send you a – I'll contact you. I've been – you know, I'm spending some time in Florida now, so I'm on the road more often than not. And I've had some – a little bit of surgery done, so – One thing or another, I've been a little out of touch. I'll send you a note and make sure you got my number. Okay?
spk04: Yeah, make sure. If I get a cell number, that would be good.
spk03: I will. I don't want to give it to you on a... Yeah, where was I? Yeah, okay. Look forward to seeing you, David. Thanks.
spk04: Thanks a lot.
spk03: Actually, I wanted to just get my phone number.
spk00: Next question comes from Michael Wieser with Wieser Partners. Please go ahead.
spk06: Hi, Jeff. Thank you for all your good work. I'm relatively new to this, but a thought occurred, just wondering about your commentary on whether you've had much contact with the liability insurance carriers who, particularly for commercial users of insurance, King Airs are insuring the owners of those aircraft.
spk03: I remember the question and I remember you doing it and I applaud that. I actually think, strangely enough, I would have thought that I guess insurance companies are like the rest of people. They don't do anything until somebody runs over their foot. And then when they run over their foot, then they get serious. I suspect they're preoccupied with other things. REL actually has talked to them and commented and has comments. So I'm going to turn it over to REL to answer your question.
spk02: So, yeah, so for insurance people, we have been educating the underwriters We are sending them information, trying to talk to them. We just sent out the flying article to many of the underwriters. But it seems, to what Jeff just said, hard to get traction. I mean, you think it's a no-brainer, but we're yet to, you know, get some more traction. So we keep following up and keep doing it, and hopefully the light bulb will come on. Because I think if it comes on to one, it will come on to two.
spk03: Sadly, I think what I anticipate in a way is that if I were to lose a family member in a crash, I would be angry, obviously. And they would probably say, look, you knew this technology was available to make your airplane safer, and you didn't employ it. And I'm going to go after you. And when you have one of those happen, then you really look at the problem in a different way.
spk06: It seems like if you're a commercial user of a King Air or a corporate user of a King Air and this technology is available and you can meaningfully reduce the prospective liability of operating that aircraft, that you are – malfeasant.
spk03: Well, you know, that's exactly the words I would use. I agree with you 100%. I would say, are you crazy? You knew that this could happen. Well, I actually asked an attorney in New York what he thought. And the malfeasance, as it becomes more obvious, then you can really make the case you It's got to be pretty well understood. The recent articles in Flying Magazine has so strongly publicized the advantages and the safety issues associated with the auto throttle. It's probably getting to that tipping point. We'll see.
spk06: Well, not to belabor the point, but to the extent that you reach out to the trade publications in the liability insurance arena, they may find this technology interesting. You know, I'd encourage your continued efforts. It seems like it would be an important factor in delivering services to the 5,000 King Airs that are extant. So, anyway, thank you for your good work and for responding.
spk03: You're pushed very well, Ted. I can tell you that. When the FAA told us that they lost 100 people a year and what we were doing would save their lives, it was humbling. I mean, I don't know about you, but nothing I've ever done in my life saved anybody's life, including my own. So it is a wonderful opportunity to sort of give back for good fortune, which I've had plenty of. I agree with you 100%. Hopefully we'll get some traction. Good. Thank you. Thank you. Thanks for your interest. Continued interest. Thank you. All right. It looks like it.
spk00: This concludes the question and answer session. I would like to turn the conference back over to Mr. Jeffrey Hedrick for any closing remarks.
spk03: No, we're done. We're done.
spk00: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.
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