Robb LeMasters: Yes. Maybe I will add something and just in terms of trying to talk about the footprint because we are going through kind of a look at, if we were to increase capacity. Our main facility in Cambridge, just to give you some sense, a little over 200,000 square feet facility we are talking about whether you need to add 100,000 square feet there or in the U.S. And there is multiple different ways, different properties that we have to do that and to expand capacity. I would also note that’s a pretty capital light if we do a lot of final assembly in that business, which is different than our government business. So, it’s really increasing square footage and can be done sort of in that same sphere as what we have talked about in the past, that if this market really takes off, these types of projects are tens of millions of dollars, depends on how quickly it sort of increases.
But that’s what we are seeing is that SMR market really takes off in either Canada or U.S., we would want to facilitate for that. So, that’s all conceived up really in the way we have been talking about growth investments in the past.
Peter Arment: Appreciate that color. I will leave it there. Thanks guys.
Rex Geveden: Thanks Peter.
Operator: Your next question comes from David Strauss with Barclays. Your line is now open.
David Strauss: Thanks team. So, the medical business, are you still on kind of a trajectory or timeline to go from, I guess somewhere slightly positive breakeven EBITDA today in that business to the $75 million in EBITDA that you have talked about in 2025?
Robb LeMasters: Yes, we are. We put out that slide that at Investor Day, they are probably well familiar with the approximately about $200 million of revenue and $75 million of EBITDA in the kind of the 20%, 25%. We put a plus there, obviously, because depending on the timing of what we can get in the market, you kind of need a full year run rate to hit that. So, whether that’s a full year 2025 or dips over the year. But that’s exactly right. We still feel we can hit that. In fact, in the quarter, I can’t remember whether we said in the script, we kind of hit a milestone for ourselves. We turned EBITDA positive in the quarter. And as you recall, at the Investor Day, I sort of said, Jeez, I hope by the second half, it was our goal to turn positive at some point in the second half of 2023.
And so proud that the team kind of keep forward both because the top line is working as well as really good cost management of the individuals that are running that business is really looking at everything that we are doing and thinking about it not only from a top line growth, but from an expense standpoint. And so here we are with positive EBITDA in the quarter, and we see that continuing. So, that’s sort of positive EBITDA from here on in and next hopefully $75 million.
David Strauss: Okay. And Robb, probably another one for you, so you talked about – it sounds like a little bit of CapEx creep this year, but you think you can offset with working capital, good news. Can you maybe talk – I knew we have talked in the past about the initiatives on the working capital side, where things kind of stands there and where might be working capital upside that you are staying at confirmed this year?
Robb LeMasters: Yes. Thanks. That’s exactly right. So, as we have been sort of where The Street is at is consistent with the kind of base level of the $100 million-ish plus we had to finish off that. We had a little bit of the $30 million that we announced last year on Project Pele in the 2022 timeframe, but then we really had to eat up to $25 million, if you will, of the $30 million in 2023, so $100 million plus the $25 million is kind of where most people on the street are from a CapEx standpoint. So, that’s sort of the level that I feel where we sit at today as we look at DRACO specifically and maybe some light manufacturing activity on SMRs. You will get a little bit of upside potential on the CapEx just the prime versus that $125 million.
We are by the way from a CapEx standpoint, the first half, we are at $70 million. And so if you just were to double that and say we are on that run rate, that kind of gives you a sense for where CapEx could be beyond the $125 million. And you are exactly right. What we are trying to do is rally the team around if you are going to spend more on CapEx, let’s find a way to lean in on the working capital side. And so – we have a couple of people really targeting that. My Head of Finance is really all over that Mike Fitzgerald and we spent a lot of time on that. Really, the biggest opportunity we see, there is a couple of different elements of working capital. The biggest opportunity we see right now is on the DSO side of things. We are looking hard not only our receivables but advanced billing around SIP.
And really, what we are seeing is pretty good year-over-year, we had a good quarter this quarter. We were a little bit better than we expected. We are seeing a lot of management around milestones and billings and thinking about how to structure contracts and hit those milestones at good points. And so ultimately, I see that target of working capital days coming down by one day or two days each year, where actually year-over-year, we are down by about a day. So, I am hoping to squeak out another day or two days over the second half. So, we are targeting across the board initiatives, but that’s where we are spending a lot of time.
David Strauss: Great. Thanks very much.
Rex Geveden: Thank you.
Operator: Your next question comes from Michael Ciarmoli with Truist Securities. Your line is now open.
Michael Ciarmoli: Hey. Good evening guys. Thanks for taking the question here. I don’t know who wants this Rex or Robb. But certainly, when we look at your business, you mentioned Terra Power, DRACO, Pele, TRISO going. It sounds like there is a lot of irons in the fire for other SMR work. How are you managing the potential design risk? I mean all of these kind of programs and opportunities are first of a kind. Are you strained on resources there? And I am just wondering how you kind of prevent one of these calls from going off the rails if there is cost overruns or kind of what you were just saying missing milestones, but how are you looking at the portfoli8o and managing that design risk?
