Park Aerospace Corp (PKE) Q2 2022 Earnings Call Transcript

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Park Aerospace Corp (PKE -0.80%)
Q2 2022 Earnings Call
Oct 7, 2021, 11:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning, my name is Michelle, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Park Aerospace Corp. Second Quarter Fiscal Year '22 Earnings Release Conference Call and Investor Presentation. [Operator Instructions] Thank you.

At this time, I will turn today's call over to Mr. Brian Shore, Chairman and Chief Executive Officer. Mr. Shore, you may begin your conference.

Brian E. Shore -- Chairman and Chief Executive Officer

Thank you, operator. This is Brian. Welcome everybody to our second quarter conference call. I have with me, Matt Farabaugh, our CFO as usual, of course. As most of you know, we announced our earnings this morning. In that earnings release, there are instructions as to how to access the presentation, which we're going to go through now via webcast. A presentation is also posted on website. And I think you really want to have a copy of the presentation in front of you as you go through with to make this call more meaningful. As usual we tried to provide insight, interesting perspective, we can't cover everything. We don't spend a lot of time ticking through dry data numbers actually really not what we try to do in these presentations.

And want to warn you, this could be a long run I think last three, four have been, it could be like 45 to 50 minutes, so hang in there if you can, and Matt and I'd be happy to answer your questions when we don't go through the presentation. So let's get started.

Slide 2. This is our forward-looking disclaimer. Let's know if you have any questions about our disclaimer language. Slide 3 is a table of contents. We have three appendices, which are attached to the presentation. We're not going to go through those at this time. But again, let us know if you have any questions at the of our -- at the end of the presentation or you can call us later.

Slide 4. Now, we get into the heart of the stuff. We go right with the numbers. So we just announced our fiscal year '22 Q2 as you know. Sales were $13.618 million. Look at the right hand column here, gross profit $4.411 million. Gross margin for each -- 32.4%, down from Q1 as you can see, probably more or less with the level of the last couple of years. And I think that we indicated the gross margins would come down in Q2, when we did our Q1 call. Adjusted EBITDA $3.232 million. Adjusted EBITDA margin, 23.7%. So what do we say about Q2 during our Q1 investor call. On July 8, we said our sales estimate was $13.25 million to $14.25 million. So it seems like we came in within the range there and our adjusted EBITDA estimate was $3 million to $3.7 million. Again, we came within the range. Our forecast philosophy recover this every quarter. I just wanted to say, I'm not sure how much of the stuff, which go over biggest thing what, lot of you are pretty familiar with us, but, and I'll -- we still go over some of the basics, just in case you forgot or in case we have some new people don't and which we hope to.

Our forecast philosophy is a little different. We don't provide numbers that we can beat. We feel that's a little bit about of a silly game, we know almost everybody plays it, but we don't. We give you a forecast, we give you a range, we're saying you, this is what we think is going to happen. We could be wrong, but we're saying to you, this is what we think is going to happen, not easy to happen, but it happens, something we normally do, which is work very hard with a lot of dedication and commitment. So we're not trying to give a number that we can beat and then be heroes later on. We think that's kind of selling an almost just not worth your time. So I just want to remind you that.

Let's go into slide 5. Lots of factors which affected Q2 which we want to go through and throughout this presentation, these will be kind of things -- these are repeating things. Sales of essential component for missile programs, we discussed this over the last several quarters and Q2 we had sales of the component of about $1 million. Remember, that's low margin. This is, we have the relationship with the supplier. It's an overseas supplier, some of our customers and OEMs that are in these missile programs in US asked us to buy this product for them. We have the relationship with the supplier overseas. These are critical programs and then we sell the product -- we sell the product to the customers. So there is a markup involved, but it's quite low margin now. The flip side as we discussed many times is, when we actually use our product and produce the -- we call that blade of prepregs and the margins are quite high. Now, once we sell a product to these customers, I can do whatever they want with it. The expectation is that, it will be used by us to produce the composite materials for these later programs for them at some point in the future. So it flips when we produce some materials; good margin, when we saw the essential component, basically a markup low margin.

So second quarter low margin, that's already $1 million of sales of that component. Difficulty sourcing of key raw materials. Yeah, this is a big thing, over $200,000 actually in the sales, because we couldn't, inability to source materials we needed. And then international shipment difficulties, another $200,000 in the sales in Q2. In other words, this is stuff going out, not coming in. We have overseas customers, we couldn't get international shippers to ship all of the stuff, I mean, our people are really good at that too. We're really good at it. We still couldn't ship $200,000 of product that was production overseas. For us, it's very simple. We ship the product, we invoice it and then we record as a sale in the quarter. But we can't ship it, it's totally not for new sale in the quarter. So $400,000, approximately is there. And that doesn't sound good, but here's the thing.

We're over $1 million, additional dollars at risk in the last couple of weeks a quarter. So our people did a really fantastic job at the SME [Phonetic] in getting the stuff done. A lot of brute force, a lot of movement can surround, a lot of juggling, a lot of logistics, but it was a little bit of a nail biter for us, because there's a lot more at risk, all based to the same factors that the end of the quarter. So lots of brute force, daily battles, pleasure dealing with the COVID quarantines, fourth layer, but is OK, nobody is really you got really set this time around, but that reach havoc with our production scheduling and planning, because you know what happens when somebody's wife could test positive, then they have to go home, then the whole crew has to go home, and we have to work around all that stuff and there is not complaints, this is just a life that we want you to be aware of.

I think our people there have pretty terrific job and dealing with these kind of things. Domestic freight issues, yeah, international shipment difficulties, domestic freight issues. Okay, the -- sorry the supplier hasn't terribly can get, somebody deliver to us. We're talking about driving up the Kansas City train yard, you go and pick up some of the materials or sell that we couldn't do that, obviously will let us when we're talking about it. Additional core for expedited freight shipments, so, yeah, it's kind of like a little weird, our suppliers aren't really getting the product to us. And it's all well last minute we can get you something, but then we're expecting to pay the expedited freight which, OK, you could say that's kind of interesting perspective, but there are actual costs there. Cost escalations, if you're paying attention to anything going in the world, watching journal, financial news, while listening other companies, these are not going to be surprised if this is kind of day-to-day life of company that's a manufacturing in the US, not just in aerospace, I don't think either.

Raw material cost increases, basically a lot of them. Most of those are covered. When we enter into an LTA with a customer normal, it's based upon an LTA we have with the suppliers. No LTA, will then, we get new quotes for customers and we're not normally going to make an adjustment based upon material cost increases. but not always covered, general freight cost increases, mostly covered not always covered in terms of our P&L. Manufacturing supplies, yeah, it's covered, so there is risk in terms of manufacturing supplies, cost for the supplies can go up and up and up. Miscellaneous other cost, yeah, all of the light, you can tell me what they are, utilities, wages, benefits, insurance, you name it. It's very strange environment we're in, in my opinion. I'm talking about just generally, as a country.

We finally you have been able to increase our people count, remember we talked about a real quarter, we'll give you specifics later on. That's good news, but there's to assure here because obviously the people count goes up, the cost goes up as well. These are not any kind of excuses at all. We don't -- we're not into that kind of used thing, we don't like that. But these are factors that we thought you would want to know about. So let's go on to slide 6. I'm going to talk about on slide 6. This is our annual P&L history, going back to 2017. You can take a look on -- well, look at on slide 34 at our forecast for the current fiscal year, fiscal '22, if you want to compare it the prior years, but let's just move on, let's keep going, here slide 7. So we were not including this information for a couple of quarters. And one of our important shareholders, you know, we really like to see this information every quarter was -- so here we go.

Park has zero long-term debt. This is our balance sheet, cash, cash dividend history and capital allocation strategy. Sorry, I got to read the caption. Park has zero long term debt. Park has $113 million of cash and marketable securities at the end of our Q2. We've got spending to go to, complete our major expansion about $2.25 million, spending to date about $17.25 million. We spent about $800,000 in Q2. So, and the tax transition payments. We've talked about those in the past, better explain that than I am, but they have to do with, Trump tax law and sorry overseas cash. So let's see, we are $14.3 million, that we owe $7.6 million, that has been paid to date. And $1.7 million in fiscal was paid in the second quarter. That -- those payments are to be paid $14.3 million through a calendar year 2025. Of course, we always have every quarter, like little over $2 million plus regular dividends. So you did think that, think about that as well in terms of cash outflows.

Park's cash dividend, Park -- we maintained a regular $0.10 per share quarterly cash dividend throughout the pandemic and economic crisis. I don't think everybody did that. Park has paid 36 consecutive years of interrupted, uninterrupted -- uninterrupted regular quarterly cash dividends without ever skipping a dividend or reducing the dividend amount. I'm rushing, because it's a long presentation, sorry. Park has paid $548 million or $26.75 per share in cash dividends since the beginning of fiscal year 2005.

Let's go to slide 6. Another $0.10 per share regular quarterly cash dividend was declared on September 13, payable November 4 that shows record on October 1, 2021. So, here we go -- with this cash dividend is paid on November 4, 2021, Park will have paid $550 million in cash dividends since the beginning of fiscal 2005 with three exclamation points. I don't know what you think, but for a small company like Park, that's a heck a lot of money. But we get it, don't tell me what you did from yesterday, tell me what you're going to do today and tomorrow.

So now we go to Park's capital allocation strategy. Our fancy way of saying what are we going to do with all that money for those of us that aren't really living in the Wall Street or financial world. I think that's what it means. So, acquisitions and potential collaborations, Park continues to watch and track certain potential acquisition opportunities, but also strategic targeting of certain aerospace industry segments and product lines. We talked about this last time. So we identified areas we want to go into that we think are strategic and just reacting to stuff that comes over the transom from bankers let's say. Park has reached out to several companies and continues to reach out the companies in the targeted segments. So we're still out there, we're still trying.

Next, let's go onto the next slide, slide 9, potential strategic investments in major aerospace and aircraft programs. Park has reached out to a certain large OEMs regarding strategic investments and major new aerospace programs. So this is really interesting. These are household names, OEMs in the aerospace industry. We're aware of new programs that are considering, maybe they haven't been announced yet. So we've reached out to them and asked if we can work with them on these programs partly by making investment. Obviously, we would also want the business as part of the discussion. So let's keep going Park every dollar which cash through much dedication and sacrifice on the part of many Park people over many years. Park's money is not easy or cheap money. There's not easy come, easy go with us. So we will not invest our cash casually or do a deal just for the sake of doing a deal. That money, when it comes hard, my feeling is, you're tenant, you're going to tend to be much more thoughtful, much more careful, much more serious about how you spend it. It's not going to be, let's just going to throw money around for this thing or that thing, a cool idea that somebody has had. If and when we do a deal or invest our cash in an acquisition or some other form of strategic investment, we will feel is the right thing to do for Park and its owners, meaning you. Well, I guess, somebody, who were not shareholders, but many of you are.

Slide 10. Okay. This is our one of our standard slides in our presentations. These are top 5 customers, kind of a fun thing. Let's start with Aerojet Rocketdyne, they're going to lose quite a bit recently, that goes with North Grumman ground based strategic deterrent at GBST, if you heard about that, that's a really big deal, we're very happy to be on this program. And we hope to hit more penetration of the GBSD. This is the next generation ICBMs very important for a company's -- country's defense. There were matrix composites. We have a picture of matrix here, but they're multiple programs. Kratos, they seem to be in the top 5 quite a bit. We have a picture of their UTAP-22 drone, we're told by Kratos that we are the main supplier of composite materials for their drone programs. So anyway, here we usually try to find a different picture every quarter, seem to be a tough quite a bit. Okay. Middle River Aerostructure Systems, we know that is, there's plenty -- plenty of stuff about them in the rest of presentations who all here, but we got a nice picture of 747-8 Engine Nacelles in the bottom right. Those Nacelles you see here are all maybe Park materials.

And Nordam Group, we featured Nordam Group, a different program last quarter I think. This time, it's a top right, the Passport 20 Engine now, what's interesting is that, we produce the materials for the Nacelles and thrust reversers for this engine through MRAS. But this is not MRAS, this is a component of the engine itself. Say, a primary structure, sorry, a primary structure of the engine and this is produced by the Nordam Group who are the Passport 20 Engine which goes on the Global 7500 long-range business jet.

Let's go on to slide 11. Okay. So here's our, another standard slide that we have in our presentations, our pie charts. We have '20, we have '21 and we have '22, for the first two quarters. And just for comparison, look at how the pieces of the pie has moved around. The commercial is back dominating. Why shouldn't say dominant, that's not right, but much more significant than it was, let's say, in '21, that's not, I don't think should be a big surprise to anybody. Military, maybe a little slower, we here generally, not for us due to budget issues. Although, I guess the Senate Armed Service Committee, just released its full mark up as down, so I can tell you about it, good for many of our programs going to Valkyrie. For us, military, it's really going to be the programs we're on and which ones are active which ones are not. Military for us is very different, and commercial -- commercial especially have much programs are going to be running, running, running every month, every week really, but military, we could be on a really good program, it will be active one quarter and then it will be active next quarter and then it will be active in the final quarter. Obviously, we have no control over that. So that's why the military revenue could to be a little choppy. But it's not to me anyway a function of the military market getting stronger or weaker. We think it's just fine from our perspective.

Also in niche programs are on. We like those. We think they're less said sensitive to the big budget fluctuations that these programs, sometimes get caught up in. Business aircraft, for us, that's mostly the Global 7500, that's the big dog for us in business aircraft. Although we do supply into other like Gulfstream and Falcon and Citation type programs. And business aircraft has been quite good, so for the last, I don't know, six, eight months, maybe nine months for maybe obvious reasons people are able to have to fly on business jets prefer to do that rather than. Commercial will go into much more detail about commercial throughout the presentation, so let's keep moving here. They only get bogged on.

Slide 12, this is going to a little fun slides that we do every quarter. This is a line and of your project. We have of lot of fun with this. This is not necessarily the biggest military programs. But their programs we think you'd find to be of interest. The top left, so we're in the tax free program, just really come of fun thing or interesting thing for us. F35 provide tracking data of an incoming missile to a ground-based interceptor, tax free. We were in that tax free program for a long time. I think we mentioned many, many times. Then the next one to the right. US Navy MK-41, vertical launch system and we actually produce materials and parts of this program. But we're not really at liberty to talk about it very much, except this is a really nice picture of, you should see them the actual missiles being launched from the deck of a navy ship. Next one C-27 J Spartan Medium Range surveillance aircraft. So this is radar materials for the Coast Guard and then Avio Aster hypersonic missile later materials, probably not surprising there. And then SpaceX Falcon Heavy really nice to be on this program, we ought to get more penetration to the SpaceX programs, but we're not really in a position to talk about what we do with that program.

The niche programs as we consider radomes, rocket Nacelles and drawn to be the niche major programs that's really like to focus. Let's go on to slide 13. Okay. Changing gears here update on our major expansion of Newton Kansas, total budget, moved it up to $19.5 million by the time we should have $19 million. So it's creeping up a little bit, spending today about $17.25 million. They need to go, head it up everything totaled $19.5 [Phonetic] million, that's $2.25 million to go. So you know, the expansion is complete, the way it works is that there is holdbacks with some of the suppliers, when things get signed off and certified. And the final payments are release that's why there still some money to be paid out. Manufacturing trials in progress, which is good. Qualification runs expected to begin probably run Thanksgiving toward in December. We pushed forward with our major expansion when many others are slashing their capital spending maybe to zero, good thing we did. If we had, we'd be in a world of hurdle right now. Originally this expansion was for redundancy as we remember, but based upon what everything going on, we really use this expansion for capacity as well. We figure it out now we've been in big trouble, because you don't do an expansion and built have, getting building build or the equipment design equipment, get equipment certified and released, get the factory qualified in six months. It's not -- it's like a three year process.

So, if we didn't and start keep going, we've been a real -- we have a real problem in our hands right now. So good thing we made the right decision. One thing that's a little new here in the picture is the bottom picture, you see the existing facility in the middle with the new offices, the facility in the left, this new facility. And this little building the right, that's actually something been all along. We never really talked about it, but I wanted to just see it. It's about 10,000 square feet. Tent City aircraft works, that's our R&D facility. And the name -- we came up with a name is kind of a little bit of a secret thing, but anybody can guess how we came with that name. Well, maybe we'll send you at least $1 or something like that. All right. And then the middle picture, that's the new building with the new office -- sorry, the existing building with the office expansion seats, two stories now. The building the top is the new building.

Let's keep going on slide 14. So commercial aviation, updates and developments, changing gears again on the commercial aviation. The first item we had in our prior presentation, higher jet fuel prices and environmental concern provide extra motivation for airlines to more quickly replace less fuel-efficient legacy single-aisle aircraft with more fuel vision modern single-aisle aircraft such as the Airbus A320neo.

Next item. So this is new stuff, and we're going to try to give you a little perspective here as to what's going on with the commercial aerospace, commercial aviation market. The domestic commercial aviation activity was coming nicely in all major markets, but the Delta variant negatively impacted recovery in August and September. The passenger traffic down in August and probably September as well. September, as we fully reported, but that's the expectation.

So in the China domestic aviation market is probably impacting the most of major markets based upon the Delta variant outbreak in China. But the US domestic aviation market as well as other major markets have also been negatively impacted by the Delta variant. The full US domestic aviation recovery, meaning back to pre-COVID, I guess that's what we mean by that, which have been predicted to occur in the first quarter of next year or even earlier, maybe the fourth quarter this year, maybe pushed to the right to some extent, by the Delta variant. My feeling is a very minor amount. That's my feel.

And let's go on to slide 15, maybe we can talk about this more, why will it be a minor amount if at all. Will is temporary setback negatively impact airline orders from the airplanes produced by the large commercial aircraft manufacturers? Well, I don't know if you're running an airline, you have to -- airline business means long term planning. You don't just order an airplane and buy it in two weeks. So if there's a two or three week -- sorry, two or three month setback and passenger traffic data and you're running an airline, you really going to change your order pattern, you're going to push out orders, you going to cancel orders. We're not talking about the beginning of the pandemic when there is massive uncertainty about everything. This is a very different situation. My feeling is that if you're running an airline, you make that decision to push out or cancel orders under these circumstances, you're probably in a wrong business, you probably shouldn't be running the airline with a large commercial aircraft manufacturing, Boeing, Airbus change or adjust the production schedule based upon this test setback, I'd be shocked. I guess they did that. I would be very quite surprised. In any event, we have not seen any evidence of this in our own business.

Will the Delta variant be trending down by the end of November as has been predicted by certain experts? I mean people are saying it's trending down already. A lot of people saying that in a lot of data, I guess to support that. Also, there are other countries that started with the Delta variant before us, like India and I think UK. And we look at their patterns. So I think there's a lot of expectation that the Delta variant is kind of winding down. And by the end of November, even maybe at the end of October, we'll see it winding down even more.

So my feeling is that, yeah, it did affect passenger traffic. They say that in let's say, August, September. But my feeling also is just to have no impact on our commercial aerospace business. International Commercial Aviation has started to recover to some extent, based upon some loosening of travel restrictions and increased vaccination rates, but big body still significantly lags domestic aviation recoveries. International Commercial Aviation is still expected to take a number of years typically recover -- fully recovered means a pre-COVID level. I don't know, maybe three or four years at what people think.

Let's go on to slide 16. Since single-aisle commercial aircraft are designed to service domestic aviation markets as well as shorter range international aviation markets, Park believes single-aisle is the place to be in commercial aviation at least for now. Yeah, we feel we're in the right place, because single-aisle that's the A320 family, that's like the -- probably, I don't know aircraft for the decade, maybe for multiple decades, COMAC919. Those are all single aisles.

Three interesting questions. How will GE Aviation's rise engine development affect the commercial aircraft industry in the future? Have you heard about this GE Aviation rise engine? It's actually ending with GE Aviation, that's not correct, it's CFM, which is the partnership between GE Aviation and Safran. So that's actually not correct. But, will Boeing develop a new single-aisle aircraft to compete against the A321XLR, which Airbus plans to introduce in 2023. Last one, will COMAC919 will be certified in China before the end of this year? We're not going to go into these items, because we just don't have time, these would take 15, 20 minutes to have a proper discussion of these items. I just want to put them out there, because they could be important in terms of what happens in the future in the commercial aviation industry and markets.

Let's go on to 17. This is a slide you've seen almost I think every quarter, with some minor modifications. We're not going to cover it just as to save time, except just the first couple of items. So just the basics here, we have a firm pricing LTA. It's a requirements contract from 2019 through 2029, with Middle River Aerostructure Systems, MRAS subsidiary of ST Engineering Aerospace. So what is this about? When we entered this contract, MRAS was a subsidiary of GE Aviation, and then it was sold to ST Engineering Aerospace I think about three years ago. But that's why all the programs we're on through MRAS are GE Aviation or CFM type programs. It's the GE Aviation tie-in that existed before the sale by GE Aviation of MRAS to ST Engineering.

We've done. In fact, we talked about that already construction is complete. So our deal with GE Aviation and MRAS was as soon as they sign this LTA, we're going to go ahead and build a factory. And of course, we did that even though it was just a handshake, but of course, we'll live up to our commitments. So let's not go into the rest of the items here. If you have any questions about them, please ask. Legendary Boeing 747-8 Engine Nacelles. I love this picture because, especially this guy in the background, it shows you how huge these Nacelles are, these are all Park materials that go into these cells, lots of content.

On slide 18, update on GE Aviation jet engine programs. So let's do an update now. It's going to take a little while. So we'll try to go through as quickly as possible. So the A320 Neo family of aircraft. This is the big, big dog. These have the LEAP-1A engines. It's ramping steeply. We had this in the last investor presentation, but let's just quickly go through it. On May 27 news release, Airbus stated A320 family, Airbus confirms an average A320 family production rate of 45 per month in Q4. That's basically now, right, Q4 of this year. I just want to mention that it's been at 40 throughout the pandemic. That's where they held at 40.

And they call on suppliers, meaning like us to prepare for the future, by securing a firm rate of 64 by Q2 of 2023, 64. That's moving on quite a bit. In anticipation of continuing recovering market, Airbus is also asking suppliers to enable a scenario of 70 by Q1 of '24. Longer term, Airbus is investing opportunities for rates as high as 75% to 2025. And this is the picture of A320 Neo. So those are very big numbers.

Let's keep going on slide 19. As of the end of August 2021, CFM, meaning LEAP-1A engine had a 60.25% share of firm orders for the A320 Neo family of aircraft, but the source of data as the aero-engines, which is kind of like the bible for commercial aircraft engines. So the A320 family of aircraft has two engines that are certified for the program. One is the CFM LEAP-1A and the other one is Pratt [Phonetic]. So this is the share, we're talking about share that the CFM LEAP-1A engine has. That's our program, the CFM LEAP-1A. We're not on the Crack program. So that's the -- CFM is good for us. Pratt, we don't supply into the Pratt program.

Let's keep going here. Assuming a 60.25% CFM share, this is assuming that. And those are the facts now. We're not predicting that for the future. We don't know what happens in the future, but this is the current share. And it's a big backlog. It's not like just a few planes, thousands of planes, thousands of planes that are ordered. 75 A320 Neo aircraft family per month rate. That's the rate we're talking about the prior slide represents a significant increase over the number of units forecast in our long-term forecast. So let's talk about that.

In the long-term forecast that we have from MRAS, A320 units, sorry A320, if we do the math and kind of back into the math, it's equivalent to 57 airplanes per month, 57 A320 airplanes per month. Assuming what share that assuming the 60.25% share for instance, and doing other computations, 57 compared to 75. So that represents -- it's a lot higher. Like I said, I think it's over a 30% increase over our forecast. Our forecast tops out at that, assuming the 57 number in 2024. We're not at that number yet. We're not at that number in the forecast yet. So our forecast tops at 2024, assuming a 57 rate. But Airbus is saying they want to get to 75. So big, big, big number. The difference is millions and millions of dollars per year for Park. Difference between 57 and 75. Will it happen? I don't know, but I want you to be aware of it, because it's a big, big deal as far as I'm concerned.

Now there's some tension with Airbus suppliers, particularly engine suppliers some tension has developed over the aggressive A320 Neo aircraft family forecasted ramp up. There's historically been tension between aircraft and engine manufacturers about production rates based upon diverging economic drivers for the aircraft and engine makers. What does that mean? The aircraft makers make their money by selling airplanes. The engine makers make their money by servicing the engine, not by selling the engines. So there's a tension that's existed for a long time. This is not a new thing. So here's the point. The engine makers aren't anxious for the aircraft maker to come out with the next-generation airplane because they want to keep servicing the legacy engines on the legacy airplanes. CFM also supplies into the legacy 737 and the legacy A320 with the CF56 engine. They want to keep getting some life out of those engines. So if everybody says, wait a minute, we're going to really up our production plans for the Neo. That means those airplanes are going to retire, and then GE loses the revenue and margins from the service of those engines, because the airplanes are going to be retired. You get the dynamic? It's pretty important to understand that if you're in the commercial aerospace.

Slide 20. Then on July 29, 2021, the Airbus CEO stated that he is disappointed that some partners, many suppliers are challenging to ramp up. He further stated, we have a backlog of more than 6,000 A320 Neo family aircraft. At a rate of 40, which was the rate they were at until, I guess, this quarter. That means 15 years of production, a rate of 60, it means 10 years. That's a long, long time. Customers do not want to wait that long. We have to go. Now this is the sic, I think it was a misquote. But that doesn't make any sense. I think he said above 60. It's pretty obvious, he said above 60, otherwise it wouldn't make any sense. I think he said above 60. It's pretty obvious he said above 60, otherwise it wouldn't make any sense. He further stated, we expect the supply chain to ramp up at a much faster pace. So here we go. We have a little potential here, as I said.

The aggressive ramp up is partly based upon the success of the A321neo, the CEO also commented on July 29 that Airbus wants to be capable of production share of A320neos significantly above 50% to a share of 60%. So you want my opinion as to what will happen is just my opinion, I can be wrong. My opinion is that if Airbus can sell these airplanes, GE or CFM will supply the engines. And why do we think that? Okay, because they share this program with Pratt. So if CFM digs her heels in and says, "Well, we're not going to supply that many engines to support the airplanes that you want to produce Airbus." Airbus can say, "Okay, that's fine. I'll get to Pratt. Maybe Pratt can help us out." In that case, what happens to CFM, they don't get any revenue for servicing new engines, for not selling the new engines on these programs. And the old airplanes, the legacy airplanes are going to be replaced anyway, but with neos that are produced with -- manufactured with Pratt engines. So you lose either way.

It's my opinion, I could be wrong, but my opinion is that there's going to be a lot of haggling back and forth at the end of the day. If Airbus could sell these airplanes, GE or Safran -- GE, Safran and CFM will support it.

Airbus also recently announced resuming work on a new assembly line in Toulouse for an A321neo aircraft. So maybe they're putting their money where their mouth is, not just talking about trying to move the rates up, they're investing.

So let's go on to Slide 21. The A321XLR, we've spoken about this for several quarters now. So this is supposed to be in service in 2023 and is probably a big driver of the aggressive forecast of the A320neo family of aircraft. This is considered to be in the A321neo. They have over 450 orders already. Is it a game-changing aircraft? Yes, it could be, I think, probably. Because with this range of over 5,000 miles and the seating capacity over 225 seats, well, it really replaces some of the widebodies on some of the shorter international flights at much lower cost. So you're going from, let's say, North America to Europe, you want to get in a widebody or you get on the XLR, much lower cost for an airline with the XLR, and they still have quite a bit of seating capacity. So let's see what happens.

A key question is this single-aisle, 5,000-plus statute mile ratings, 225 seating capacity market being ceded to the Airbus A321XLR, that refers to what Boeing is going to develop an airplane and compete against it. So -- and last item is just back to the A320neo family, generally, 95 orders in August, which is not bad.

Let's go on to Slide 22. These are still a GE Aviation or GE Aviation programs. In this case, again, it's a CFM program. So COMAC919, we talked about that quite a bit. Interesting dynamic here. Recent reports, U.S. export control is slowing progress of 919 but COMAC almost immediately responded by saying, "No, it didn't really -- those export controls didn't make that much of a difference, and they were doubling down on their certification time line before the end of this year." They're saying they're going to have the airplane certified this year, and that would be in China for China deliveries. But nevertheless, they're sticking to it. So let's see what happens. Maybe by the next conference call, we'll know what would have happened. So -- but this is an important potential program for Park. So let's see what happens with it, but that's the dynamic there.

Slide 23. Let's go through this quickly if we can. The Global 7500 for the Passport 20 engines is ramping up. This also is planning to have our Lightning Strike material certified for this airplane next year, which is a good thing. Also, those are high-margin product for us. And the COMAC ARJ21, that's a regional jet. That's ramping up as well.

Last one is the 747. We talk about this every quarter, and we have a lot of pictures of the 747. It's kind of a sentimental thing for us for reasons we've discussed probably in the past. But Boeing announced they're going to terminate the 747 program next year. So that will be a real sad thing for us. I mean, we'll have to have a visual for them. But I also want to remind you, this is less than $2 million of revenue for us. So we emphasized a lot, but it's less than $2 million. That program is less than $2 million of revenue for us per year.

Slide 25. Okay. Let's just quickly review this. Commercial aerospace industry in a meltdown mode -- sorry, industry meltdown in review. Why don't we just kind of skip to the end. You can read all the different items here. We know about it. It was really Armageddon in the commercial aviation industry, commercial aircraft industry, both. Almost all the news about the industry, back at the beginning of the pandemic, was very negative. Aviation analysts and commentators predicted that the recovery will not come for many years or may never come -- never come rather, the end of day scenario, pretty dire stuff, pretty dire stuff that was being talked about and believed also.

Slide 26. Result in the end of day's attitudes, companies in the commercial aircraft supply chain laid off thousands of people and went into bunker survival mode. Production slashed or even halted. Thoughts about industry recovery, how to handle it were just not in the minds of many, probably most companies. And the supply chain was all about survival for them, since the belief was that a recovery, if any, was so far in the future was not worth thinking about. But surprise, surprise, people got tired of being locked down. Vaccines were developed as promised and people started to want to fly again in domestic flights, and lots of people. Remember, these flights were empty. So all of a sudden, people wanted to get on these planes again. So it's kind of a big change. And as a result, airline companies wanted to buy airplanes again.

At the beginning of the pandemic, airline companies just didn't airplanes. There's so much uncertainty about what the future was. But now they wanted to buy airplanes and a lot of airplanes. And somebody needs to produce the thousands, thousands of components which go into these airplanes, airplanes that the airline companies want to buy now.

Let's go on to Slide 27. But the commercial aircraft supply chain was going very flat-footed and the bunker survival mode was not in the mindset to quickly ramp back up to meet the renewed demand. Plus, since the supply chain companies had laid off such a massive number of employees, so did not have the workforce to meet the industry ramp up anyway. These companies tried to hire back the employees they laid off, but has been widely reported that has not been so easy. Plus, the government was paying people not go back to work. So that didn't help either.

What's the result of all of this the whipsaw effect in which the commercial aircraft industry supply chain was caught flat-footed and is struggling, in some cases, badly to meet the unexpected increased demands the commercial aircraft industry as it recovers. So kind of a whipsaw because they were kind of clamping down in the survival mode, then all of a sudden, we need to ramp back up again. And the response has been, I would say, lukewarm. This is today's commercial aircraft industry supply chain dynamic. It's a difficult one.

Slide 26, but at Park, we do not buy all the doom-gloom news. We did not buy the end of days were at hand. Here is what we said. This is interesting. This is what we said on May 14, 2020, this is the beginning of pandemic, the beginning of the crisis, when confusion, uncertainty and fear reigns supreme. Just read this. I'm not going to read it for you, but go through it, quite interesting.

We were not going into the bunker mode. We were in the go-forward mode. And you know what, we're pretty much alone. I don't remember too many people that were joining the -- I don't know what you call, the mission that we're on. But the last item that we got one for you, we believe the glory days of aviation were returning, we tend to be part of it.

Let's go on to Slide 29. At Park, although we do not know when we believe the commercial aircraft industry recovery would come, and we wanted to be ready for it and be a part of it. We're not giving up on the commercial aircraft industry. It's quite the opposite for us, actually. So we made arrangements. We talked about this before with MRAS to maintain minimum monthly baseline critical mass production levels to preserve Park's ability to ramp production we need. This is critically important. If we went below these levels, we have a real problem in our hands, because we would not have the critical mass to ramp back up, and it would be a problem for us, big one; problem for MRAS, big one; and a problem for some of those aircraft manufacturers, big one.

And even though layoffs were widespread and pervasive, we didn't really know anybody wasn't laying off people in the commercial aerospace industry. We laid off nobody, none of our people through all the darkest and seemingly hopeless days in the commercial aerospace industry. It turns out the decision not to lay off any of our people was really important for Park. Because if we laid off people, we would have -- we'd be in such bad condition in terms of trying to ramp back up. It would be very, very difficult for us.

Slide 30. So GE Aviation jet engine programs, the Park -- the ones where Park is on, ramping up fast. So GE Aviation jet engine programs that Park is on -- sorry, the focus on are ramping up and the ramp up is going to be steep.

Just for perspective, we shared this with you last quarter. Look at Q3 of 2021, $1.8 million. Then move forward two quarters to Q1 2022, $7 million. That's a 4 times increase in two quarters, 4 times in the quarter. That's very, very significant for a manufacturing company. We're not into selling stuff. We have to make it. We have to get the raw material. We have to produce it. We have to test it. We have to ship it, a very big challenge, a very big challenge.

Just FYI, so fiscal year '22, Q1 and Q2 are already at pre-COVID levels, already, if you look at Q1 and Q2. And the ramp-up is still long -- has still a long way to go. Important question, how is the commercial aerospace manufacturing supply chain responding to the steep ramp? I would maybe give it a C-, not so great. It's an issue and challenge for us every day.

Slide 31. How is Park responding to the GE Aviation program steep ramp up? All about our people. I'm going try to rush even faster here, because I know we're going really long. Our current headcount is 114. We're at 105 last quarter. So we're ramping up our headcount a little bit, but still a challenge. We still have number of people are looking to hire, two steps forward and one step back in terms of the hiring process.

So Park's people stepped up once again. That's what Park people do in order to get everything done in Q2. We already talked about the challenges that had to be overcome, so I won't go back over those again.

Once again, thank goodness for Park's customer flexibility program. I won't go into the details, but this program, as we talk about almost every quarter has been really critical to Park, especially as you're trying to ramp back up.

Slide 32. How is Park responding to the GE Aviation program's steep ramp up continue? All about our people. We can't say enough about our people. Thank goodness for Park's great people. Without them, we couldn't get the job done. Park is fortunate and blessed to have such great people and every Park person received $150 bonus for his or her dedication and outstanding work during the second quarter, well-earned and deserved.

A lot of brute force, lot of supply chain issues, freight issues, COVID quarantine issues, logistics planning big challenge. But through dedication, loyalty and commitment, we were able to meet our objectives for Q2.

So Slide 33, and I'm rushing this quickly. You see the numbers, not much discussion about it. The only thing I would say is that -- this is GE forecasting, of course. It's difficult quarter-to-quarter because of the inventory practices, things can move from one quarter to other. It can go forward and move back, that makes it more difficult. To me, one of the big questions, though, is when will the numbers ramp up to meet the -- especially the forecasted numbers that Airbus is coming out with that we spoke about earlier in the presentation? Because we have a mismatch here. We're not operating anywhere near those levels.

So at some point, either Airbus is going to bring those numbers down or the number is going to have to go up, but can't be both ways. So something is kind of have to give. Is it going to be in the fourth quarter? It's going to start in the fourth quarter? I don't know, hard to say, really hard to say. If I had a feeling about it, I would let you know. But at this point, I'm just saying it's out there, it's kind of hanging out there that we know something has got to give. Something is going to happen. Unless Airbus says, "Wait a minute, we changed our mind, we're bringing our numbers back down to 55 or 57 per month." Maybe that's a different story. But unless Airbus backs off or backs off a lot, something has got to give, because we're nowhere close to operating a level to support that program. And the other programs we talked about as well that are ramping up.

Slide 34. Again, the numbers are pretty straightforward. I won't go into them in any great detail. I'll just mention that in Q3, we expect about $400,000 of ablative sales. That's good. In Q4, though, we expect about $2.5 million of the critical essential component sales, which not great margins, but also about $1 million of the sales of the ablative materials, which are relatively good margins.

Same question. If you want to go back and look at those factors that we talked about regarding Q2 on Slide 5, we'll do that, because they apply for Q3 and Q4. Those factors haven't gone away once we keep talking about.

Same question all about the GE programs, particularly Airbus. At what point is the -- at what point is our production going to match their requirements? At this point, it's not matching. At some point, something is going to have to have. And like I said, they're going to bring their numbers down or we're going to have to move our numbers up. When that will happen? I don't know. But it's out there. It's kind of looming out there. And we're ready. We're ready to go. Obviously, we have our challenges with our supply chain that will continue, but Park is ready to go. As I said, it's really good we did stop that expansion. They're going to slow it down, very important for Park.

Let's go on to Slide 35, 36. So these are the last slides, so let me go through them fairly quickly, but they're important to us, changing gears a lot here. What matters the most at Park? We're deeply saddened by what we see in here in our world today. We're told that people who work for living do not matter. We're told they're expendable. We were told they are to be sacrificed for some loosely defined or undefined greater good. So to us, it's really tragic. But we understand we're a small company and what we say or what we believe it doesn't matter all that much about these larger issues. But what matters a lot is what we say and think about our own people. So at Park, our people are not expendable; at Park, our people matter the most; at Park, our people are everything; at Park, our people are our family. We do not turn our back on family. Our people are not to be forsaken. Our people are not to be sacrificed. At Park, our people are precious; At Park, we're the most fortunate when it comes to our people. I always say it's a lot, but it's because I mean it's a lot.

Let's go on to slide -- our last slide, which is 36. At Park, our people work for a living. That's what they do. At Park, our people make money for our owners. That is what they do. It's something that our people are committed to. I'm talking about all of them. Now we made money every quarter throughout this pandemic and economic crisis. Did everybody do that? I don't think so. I think most companies in the aerospace supply chain probably did not do that. But that was something that our people doing, it wasn't easy throughout this pandemic, throughout the economic crisis. Our people did that. Made money for owners every quarter. That's what they do. Not an accident, not luck. It's based upon serious commitment and dedication, serious commitment and dedication. So just wanted you to know that.

Park is a strange and unusual company, built by wonderful and special people. At Park, we're not like the others. At Park, we play for keeps. So we always feature, always at least in the last few quarters, a picture of one of our crews. In this case, we're featuring two crews: customer service and purchasing planning teams. Let me go from left to right: Jordan, Teresa, Jonathan, Chris, Dakota, Sara and Elena. So these people, all the things that we've been talking about during this presentation, these people are on the front lines with all the supply chain issues, freight issues, international freight issues, juggling customer orders, quarantine initiatives, production planning and then the possible environment. Because normally, you want some visibility in production planning. You don't want things to change every week, every day. But these things that kept coming up, let's say, COVID quarantine, you can't predict that. So lots of juggling, a lot of moving schedules around, big job, brute force was probably the way of the quarter for these people. But this group saw to it that we met our objectives for Q2. They always on ways to overcome the obstacles.

So thank you very much. Sorry to take so long. I was really rushing. It probably made it difficult for some of you to follow, because I was going so quickly and maybe skipping over things. But operator, we're now done with our presentation. So if there are any questions, we would happy to take them.

Questions and Answers:

Operator

[Operator Instructions] We have a question from Brian Glenn with Olcott Square. Your line is open.

Brian Glenn -- Olcott Square -- Analyst

Hi, Brian.

Brian E. Shore -- Chairman and Chief Executive Officer

Hi, Brian. How are you doing?

Brian Glenn -- Olcott Square -- Analyst

Good how are you?

Brian E. Shore -- Chairman and Chief Executive Officer

Good. Thank you.

Brian Glenn -- Olcott Square -- Analyst

My question is -- there's two questions. So the first is -- thank you for the walk through, of course, as always. The first is around the supply chain. You alluded to it a little bit. Is there a chance that you guys who are more than adequately prepared for a ramp that you're held back by the rest of the industry? I know Airbus has several thousand or more suppliers for that program. I know not all are sole source, so there's some ability to toggle. But is that a real risk going forward that you see as potentially material?

And then the second question is around -- I know you haven't put in place guidance yet or brought it back. But if we go back to pre-COVID, I know during COVID, you guys worked on some military programs and there were some added efforts there. You talked about the Lightning Strike material through Nordam. That's on the Passport 20. That looks like a new program that may happen or that is happening. And so commercial aside, if you think about the long term without getting into numbers, is there kind of a net add in terms of the programs you might be on or that you are on versus if we go back to 2019 when you had that forecast in place?

Brian E. Shore -- Chairman and Chief Executive Officer

Okay. Thanks. So let's see, the first question is supply chain and is that going to be an issue for us ramping up? As you -- I guess, as you at least implied, we are sole source on these -- all the GE Aviation programs, including the Airbus A320 family programs. So I think the risk of our being replaced is nonexistent on the existing programs, if that's what you're getting at. But there certainly is a major challenge for us and our supply chain as we're ramping up. Plus, we're also doing trials and everything else. So there's even more work there. So it's a major challenge.

And when will this kind of thing even out? I don't know. I mean there's a lot of reporting about it. When will the suppliers kind of catch up and kind of get their rhythm back? I don't know, maybe toward the end of the year, that's what I hear some reporting about that. But of course, it's a case-by-case thing. We have three or four major suppliers that we use for these GE Aviation programs. And we really need to look at each one individually. Some are doing well. Some are struggling. And I don't want to how else to answer, except it's just a major effort and sometimes brute force effort.

So -- but the other side of the equation, I guess, is our people are very determined, very committed to finding ways to make things work, and we've been able to do that for the most part. So I don't know, Brian, I'm not sure if I answered your question adequately. Is that kind of information you're interested in? Or is it something else that you're going for there?

Brian Glenn -- Olcott Square -- Analyst

That was helpful. Yes, I know you guys are sole sourced with respect to the GE program. Yes, it was just around people, even suppliers even outside of your vertical, right? They're supplying into the Passport 20 [Phonetic]. This is totally outside of your control right, and it's a bottleneck to everybody?

Brian E. Shore -- Chairman and Chief Executive Officer

Right. Okay. I understand that question. So it's a really good one because, let's say, we got everything organized, our suppliers OK. But if Airbus is not able to source other key components, they're still not going to be able to make the airplanes and it affects us. I get what you're going for.

Well, that's a really good question. I don't have a crystal ball on that one. My feeling is it just my feeling is it's going to be ugly and messy for a while. My feeling is at some point, the supply chain, some of these are very large companies that don't really, aren't agile, don't move that quickly, at some point will catch up and kind of get used to the new rhythm, the new rates and everything else. When that will be is a good question. I don't know. But I think probably -- I'll just give you my -- it's all my speculation.

My feeling is toward the end of the year, we'll start to feel that things are getting a little better, not solved, not that won't be any issues. And I'm not just talking about our supply chain, I'm talking about what you're asking about the supply chain for these airplanes, which like you said, thousands and thousands of different components are required to make these airplanes.

You're probably not surprised to hear this, but Airbus for instance, they have a massive function that deals with supply chain management, and they spend a lot of time with suppliers, they try to identify where the risks are and try to focus on them. I'm sure it doesn't surprise you that that's what any good OEM would do. So I don't know if that helps, but I don't know what else I can do.

Yes. Now the next question, we haven't reissued our long-term forecast yet, Brian. But maybe in the third quarter, we'll try that. We're a little bit uncomfortable now because there's a lot of uncertainty of the things we talked about throughout the presentation. But absolutely, yes, the programs you've been working on and developing over the last year-and-half, since the pandemic started, those aren't just temporary things just of our factory. Those are things which we hope and expect will have long-term impacts to us.

Now in aerospace, I just want to add, you've got to do this because some of the programs you run, they're going to go away. So even they just kind of just breakeven or keep the same levels, you need to keep getting new programs. But our objective, of course, is not just to kind of maintain our levels, it's increase our levels -- our sales levels.

The Lighting Strike is a good example. That's Commercial, of course. And we hope that we also get Lightning Strike on the ARJ21. That's the COMAC regional jet. Once we get a Lightning Strike on that program, if we can, then we'll have a clean sweep of all Lightning Strike on these programs. Lightning Strike, that's actually from fairly significant revenue, but also quite good margins. That's a product we really love selling. But then there's lots and lots of military programs. We talk about them every quarter. We have a little picture. Some of them are little, some of them may not be little. And you got to get your foot in the door, you get to start, you deal with some small content and you try to grow at the larger content.

We had a picture of GBSD. GBSD is a really big deal and also SpaceX. We haven't featured those programs before, so that's good. We're getting on those programs, and we're not just going to stop. Once we penetrate, we want to do more and more and more. For us, it's always good to get -- to do something with the customer. We certainly kind of show our stuff, we can show how we service, how we respond, how we support a program. It's much more difficult to say, look, put us on your program because we're doing all these things, it's like, well, everybody says that. But once we get a chance to actually start to work with a customer, then we can demonstrate how we feel we're different than other suppliers or -- meaning, our competitors.

Brian Glenn -- Olcott Square -- Analyst

Understood. Thanks. That's very helpful. Thanks to you and your team for the efforts on behalf of the shareholders.

Brian E. Shore -- Chairman and Chief Executive Officer

Thank you. Thanks for those comments.

Operator

[Operator Instructions] Our next question comes from Brad Hathaway with Fairview. Your line is open.

Brad Hathaway -- Fairview -- Analyst

Thanks for the time, and thanks for all the detail on the call. One question was, earlier in the call, you mentioned that initially, the new facility was mainly going to be kind of backup capacity, but now you're really going to need it. Is there any way kind of big picture numbers to think about, I guess, the total kind of revenue capacity you have when that new facility is online?

Brian E. Shore -- Chairman and Chief Executive Officer

So we talked about that before. I think we said it's about $60 million in capacity, new capacity. But remember -- you may not probably remember, at least we haven't covered this for a few quarters, I don't think. But in the factory, there is a big area -- and we're talking in fact just not like a little room, a huge area that's set aside for another line. It could be a hot melt line or a solution line. So if we decide we need more capacity, it'd be very easy to drop that in. We don't have to go build a new factory. The factory is already built. The equipment has already been designed because we just bought the equipment. So it would be easy to drop in a new line there. So it could be ramped up to much more than that at that point.

So the thing I was saying, I just want to make clear is that the factory was originally agreed to with GE Aviation and MRAS as we're done the factory. Why is that? We just talked about being sole-sourced. It could take three years to qualify a composite material supplier on these major commercial aircraft programs, three years. So it's kind of a scary thought. What happens if something happens to one of our factory, our factory rather. I mean, it's like a really scary thought of. They had this discussion with people before and it's kind of -- the room gets really quiet. So they asked us very understandably, we'll build on the factory, which we did.

If you look at the little photograph of the new factory, it's actually a separate building that is joined with a passageway for moving people and material that has a fire door on both sides. So it's kind of the best of both worlds. We manage it as one factory, but it's actually two factories that are totally redundant. So if something happens to one factory or even one line, the other line, other factory is available. But -- that was the original concept. But because business has ramped up so much, and that's getting stronger and stronger, it's no longer a matter of redundancy, which is really critical in aerospace when you're sole sourced on something. It's also a matter of capacity.

So what I'm saying is that it's really good we did what we did. Because if we are starting now, we were like, wait a minute, we have a problem with capacity now, we'd be in a world of hurt, because it will take us three years ago, approximately three years ago, build a factory, get everything designed, let's say, we're starting from the beginning. And then we have to get the machines go through trials, you get new machines signed off on by the supplier and then qualification, which also doesn't -- even though it's only a plant qualification, not a material qualification, still takes a long time. So I'm thinking maybe three years' time frame. But then we have a real problem on our hands. It would be too late, and we would not have enough capacity, I don't think.

Brad Hathaway -- Fairview -- Analyst

Got it. Great. That's helpful. And is there any more color you can give us kind of on the M&A side and kind of anything you're seeing out there? I'd love to hear more about your thoughts there.

Brian E. Shore -- Chairman and Chief Executive Officer

Yes, the M&A side. So we continue to work in this area, the strategic area that we identified. And I think we might have mentioned it, but these products or products are used to make composite structures by our customers. It's not composite materials, but other things are used -- other products that are used to make composite structures. So that's one area we've been focused on.

We probably contacted -- and I mean, Matt, I don't know if you have another number, but we've had dozen or more of these companies, and we continue to reach out to other companies, and we keep trying. So that's something we feel real good about, because we feel it makes so much sense for us to be in that area. The challenge is to find the right opportunity, because obviously, what times you contact somebody, and thank you very much, not for sale, that kind of thing. So these are not auctions where some thing is for sale. These are bankers putting it up for sale. So it's a little more difficult from that perspective.

There are a couple of companies that we're kind of watching, tracking to see how they're doing. They may be public and watching how they're doing and kind of maybe the timing isn't quite right yet. We're thinking about them.

And then there's this other area we talked about, which is more of a kind of joint investment with very big OEMs and new aircraft programs, which we've had discussions. We've had beginning discussions with one of these big OEMs. We've reached out to two of them. The first discussion is -- in the beginning of the discussion, but it was with very high-level people and I felt there was a serious interest in the report. They know us very well also. It's not like who are you? So we're hopeful. We're hopeful that will be a good avenue for our investment and really great opportunity for Park's future.

Brad Hathaway -- Fairview -- Analyst

Good job. Thank you. Thanks for all the efforts.

Brian E. Shore -- Chairman and Chief Executive Officer

Sure.

Operator

There are no further questions. I'd like to turn the call back over to Brian Shore for closing remarks.

Brian E. Shore -- Chairman and Chief Executive Officer

Thank you, operator. Thank you, everybody, for listening in. Sorry, I went so long. Every time we try to -- at least I try to make a little bit more compressed, but I don't -- I'm not -- have not been very successful. Have a great day. Matt and I are available. Call us any time. We'd be happy to talk to you. Okay. Good day. Thank you.

Operator

[Operator Closing Remarks]

Duration: 66 minutes

Call participants:

Brian E. Shore -- Chairman and Chief Executive Officer

Brian Glenn -- Olcott Square -- Analyst

Brad Hathaway -- Fairview -- Analyst

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