Richard Maue: So overall, the way I would think about our revenue profile, we have an excellent mix of content on most major platforms, whether it’s narrow-body, wide-body, etc. So narrow-body certainly is the engine that’s driving the industry, but we do have significant content on wide-body aircraft as well. So there isn’t a unique aspect to our guidance or our business that would suggest the importance of one versus another. We’re just going — we’ve got content on, again, most, and we’re following the build rates.
Max Mitchell: On the 737, I would say that, first of all, it’s not good news for the industry. I wouldn’t add anything that we’re not reading all publicly as this continues to be uncovered difficult times here for Boeing, and we share the concern and look forward to assisting in any way we can as we move forward. As it relates to the freeze rates impact, I would say that our current guide has no risk, as the way we are thinking about this and have planned for the current environment. So from a Crane standpoint, I would just reiterate our guidance and have high confidence.
Mariana Perez Mora: And is there any way [indiscernible] you could share…
Jason Feldman: I…
Mariana Perez Mora: You could share — sorry, go ahead.
Jason Feldman: No, I was going to say the one thing I’d add is just next year, we also do expect, given our specific mix in the market, a pretty big uplook in regional, which is contributing to that growth rate nicely as well.
Mariana Perez Mora: And particularly on the MAX, could you please share like, I don’t know, shipset content or any metric for us to be able to measure how much of an impact that could have?
Jason Feldman: Yes. We don’t provide shipset content. But what I’d say, and obviously, it depends on what’s going on in the rest of the business and specific shipment rates for 737. The 737, generally, 2023, next year 2024, and in most years, it’s somewhere in the vicinity of 5% to 10% of sales on the OE side on probably a little bit below the middle of that range.
Mariana Perez Mora: And last one from me is on M&A. Where are you seeing in terms of pricing? And how competitive are the deals that you’re pursuing?
Richard Maue: Yes. It’s still a very competitive environment. We haven’t seen too much easing in pricing. I would say no real big changes that we’ve seen over the last six months in that regard.
Mariana Perez Mora: Great. Thanks so much.
Richard Maue: Thank you.
Operator: Thank you. Our next questions come from the line of Matt Summerville with D.A. Davidson. Please proceed with your question.
Richard Maue: Good morning, Matt.
Matt Summerville: Thanks, good morning. Just a couple of follow-ups on A&E. When you look at the business in 2023, almost got back to a top line equivalent to where it was pre coded yet margins are still comfortably below. Can you help kind of bridge the A&E business circa 2019 to where it is in 2023? And do you have a longer-term line of sight to those to that pre-COVID level of profitability? And then I have a follow-up. Thank you.
Richard Maue: Yes. We absolutely see that ability to get back to those margin levels without a doubt. In terms of what — a comparison from this year to 2019, I would also say that the volumes, while we’re seeing a lot of demand aren’t yet fully back in terms of volumes. So a lot of what you’ve seen in our progress this year has been priced to offset inflation, not as accretive as we’ve seen in the Process Flow Technologies business. So there’s a little bit of a volume price mix that impacts the overall margin profile. So when those volumes do come back, we will see that leverage at that higher end of that 35% to 40% range, and that will yield a margin profile that’s back to those levels.
Matt Summerville: And then as a follow-up, can you talk about sort of the timing looking out? I realize it’s probably not 2024, all that significant for you guys. But can you talk about when you start to see some of the more material, programmatic-driven ramp on your military side of the business? What part of the current — the 2020s, do you really start to see that begin to rev for Crane?
Richard Maue: Yes. 2025, without a doubt, yes. And then just ramping into 2026, we might see a little bit at the end of 2024, but it will be that sort of low rate initial production, but mainly 2025, 2026. Those are the AESA radars. Those are the F-16 brake control upgrade. I mean there’s some pretty sizable wins that should start to ship in 2025.
Matt Summerville: Understood. Thanks Rich.
Operator: Thank you. Our next questions come from the line of Nathan Jones with Stifel. Please proceed with your questions.
Nathan Jones: Good morning everyone.
Richard Maue: Good morning.
Nathan Jones: Maybe just following up on that question. Is there any quantitative measures you can give us on those 2025 and 2026 defense platforms, the ramp-ups and how big they might be and how much impact they might have to revenue?
Max Mitchell: Well, we’ve talked in the past to be consistent on defense power. As we’ve described, we’ve got this incredible platform of existing wins that we have — that we’re delivering on today, commercial and defense. We’re winning new business, defense power, in particular, the ESA radar, LTAMS, TPY4, Sentinel, F110, all in the $10 million a year range. Landing the F-16, $30 million over the course of three years, with further upside. 2025, 2026, with foreign military opportunities as well. That’s sizing a little bit of those that are…
Nathan Jones: Maybe $100 million-plus from those kinds of platforms stepping up in 2025?
Jason Feldman: Not all on 2025, and that’s probably that’s a little on the high side.
Max Mitchell: So we’ll work towards that goal.
Richard Maue: I think the exciting thing about those programs is that their duration as well, right? So these are multiyear — and that number that you just mentioned is the way to think about the size of each of those programs on average. Some are actually larger than that, starting in that 2025, 2026 time frame and extending out. And just to reiterate for everybody’s knowledge, these are all programs that aren’t replacing anything else we have. So they’re all incremental. That’s the exciting thing about the programs…
Jason Feldman: In one…
Max Mitchell: And then, of course, when you look on towards 2030, this is why we’re so excited also about all the demonstrators that were on, winning that content. That’s the picture we painted in the script as well.
Nathan Jones: Thanks for that one. At the Analyst Day last year, on PFT margins, you guys had targeted 380 basis points of margin expansion over the next few years. And I think, Max, you suddenly mentioned that you got 370 basis points of that in 2023. Can you talk about the major factors that led to you recognizing that margin improvement a lot earlier than planned? And then because I work on Wall Street, and it’s what have you done for me lately, what the path is forward to improving those margins from here?
