James McGarragle: So, on the defense margins in the quarter and some of the long-term targets the team established at the Investor Day, are you able to help quantify the bridge between those two? So, I know the supply chain is kind of unknown at this point and really anyone’s guess as to when that improves, but are you able to talk to the items that you do have a line of sight into over the next few quarters, such as potentially certain low-margin business rolling off, any high-margin contracts upcoming or specific cost savings related to cost synergies?
Marc Parent: Well, I think it’s all of the above. Look, as we said before, what we’re doing here is, we’re basically doing very well on order intake. You could see like six consecutive quarters now of book-to-bill is higher than 1. You have a trailing book-to-bill over the last 12 months of 1.25, which points to strong growth. And the important thing about that is the team with Dan Gelston at the helm is signing contracts that are accretive to a long-term goal. So, what you see is here is with these orders doesn’t happen overnight. And it depends if they’re products or services, products contributing to results faster. But those contracts €“ those new contracts are replacing contracts in our backlog, some of them that are drag programs that have been very much impacted by the headwinds that we faced the supply chain, as we said, as you mentioned, and on labor.
And in some cases, although we’ve done very well on order intake, not all the orders are created equal in terms of their timing. So €“ but look, we have a pretty good line of sight of those factors. So as we go €“ so that’s what allows me to reaffirm not for Q4, for sure, and then having enough line of sight of how we’re doing in terms of abatement of those factors to give the optimism that I have for its continuous sequential improvements all through next year along the way to our long-term target of double-digit growth €“ double-digit profitability.
James McGarragle: Appreciate that. Thanks for the color and I also wanted to ask a question on Civil and the potential impact of a slowdown in Europe. I know pilot trainings are regulated and that insulated from macro to a certain extent, but can you talk to how your conversations with customers in Europe are evolving given some of the macro headwinds in the region? And any steps your team is taking to prepare for a potential slowdown in that region? Thank you.
Marc Parent: Well, I think I would tell you is that we’re not seeing a slowdown from where we were at. And certainly, in Europe and in the Americas, definitely. And we’re seeing things pick up, as I mentioned in our previous question in Asia Pacific. So at the moment, we’re in growth mode and we’re forecasting to be more for at least the consumable future. So, obviously, what people talk about risk of recession in Europe, it certainly bears watching, particularly as a result, if it’s faced with a potential energy crisis, which really hasn’t occurred, materialized. But look, we’re watching it, but we’re certainly not seeing it, and we’re not forecasting it anytime soon. at least as a result of CAE.
James McGarragle: Appreciate the color and I’ll turn the line over. Thank you.
Operator: We’ve get to our next question on the line, it is from Kevin Chiang with CIBC. Go ahead.
Kevin Chiang: Hey, thanks for taking my question. Good afternoon everybody. Congrats on a good fiscal Q3 here. Maybe just on defense. In your outlook, you mentioned there’s a little bit of uncertainty here with U.S. government budget appropriation issues. I’m just wondering, do you see that primarily impacting, I guess, the timing of awards being allocated? Or does that also impact because I believe you are pursuing some cost recovery initiatives with the government on just given how inflation has played out here. Do these appropriation issues also will impact the timing of some of those cost recovery initiatives for you?
