Scott Deuschle: Great. Thank you.
Carlos Macau: You are welcome.
Operator: We will take our next question from Sheila Kahyaoglu with Jefferies. Please go ahead.
Sheila Kahyaoglu: Good morning, guys. And thank you. Maybe just continuing on that line of questioning with ETG profitability. Victor, can you talk about Exxelia, just to provide us with an update there, the performance of what you’re seeing in terms of the underlying profitability profile of the business and kind of how that tempers into your fiscal ‘24 expectations as just Carlos just said as well as beyond that period.
Victor Mendelson: Sure, Sheila. So Exxelia has been doing pretty much exactly what we expected it to do, more or less right on plan. The business has been growing. And I, as we’ve said before, that penalizes our operating margin by about 200 basis points. And I would expect that to probably continue to be the case. I would expect their margins will march up a bit over time, but not to the level of the rest of the ETG. So we’re very happy to have the business. They have mined out a lot of new opportunities. They are working on other opportunities beyond that. Continuing good product development, producing out their backlog, which has been very strong. So overall, very happy and very happy with the people there.
Sheila Kahyaoglu: Okay. Thans for that color. And maybe, Eric, one for you. I know you got lots of questions on price. Any way you could quantify cumulative price over the last, since 2019 for us? And also, any thoughts on the GTF issues and how you think that will potentially benefit HEICO’s PMA portfolio?
Eric Mendelson: Hi, good morning, Sheila. Great question. With regard to price action, I don’t have that information in front of me. And due to HEICO’s decentralized nature, it would be very difficult to pull all of that together. But I would say that in general, we have not, as I said before, we have not pushed price beyond our cost increases. So therefore, customers who have been purchasing the parts for a long time have been treated very well and it’s our plan to continue doing that. But of course new people buy the parts, and they haven’t purchased the parts in the past, they pay the newer price, and that would reflect increased prices as our labor and material costs have gone up. So, and then with regard to the GTF, I assume that will keep the existing fleet in great demand for a long time.
It’s going to take a while to work through the GTF problems. And I have no question that they’ll ultimately get through them. But in the meantime, that should be really a very strong indicator, I would say, for the aftermarket. And fortunately, these aircraft are able to pick up the slack. So I think that, that’s working out quite nicely. Originally, we always said that whenever you got a recovery, there is always a little bit of an overshoot. Well, it looks like perhaps as a result of the GTF issue that overshoot may either be delayed or won’t happen, because there is just increased demand. Our backlogs are tremendous. Our suppliers are challenged to keep up I think we’re doing better than most in that regard, but there is tremendous, there continues to be tremendous demand for our products and services.
Sheila Kahyaoglu: Great. Thank you.
Eric Mendelson: Thank you.
Operator: We will take our next question from Michael Ciarmoli with Truist Securities. Please go ahead.
Michael Ciarmoli: Hey. Good morning, guys. Nice results. And thanks for taking the questions here. Carlos, just can you give us any more maybe clarity or direction on the revenue growth outlook for ‘24? I mean, I know you called out in the press release, you expect growth in FSG and ETG, assuming FSG will be lapping a tough comp on the 20% organic, so maybe unlikely to see acceleration there. But I would think with ETG and defense kind of showing that sequential improvement. We get some acceleration of this 1%. Can you maybe give us a little bit more detail on kind of the top line growth expectations?
Carlos Macau: Well, I mean, as we’re sitting here today, our growth is going to be solid next year from acquisition revenue. If you’re referring to organic, you are right. We’re lapping 20% plus growth quarters for 2 years now. So I think what, in the FSG, I think that will be, I don’t think it will continue at that rate, Michael. I mean it could, but I’m not anticipating that. I do think it peels back a little bit. Not a ton, but it will peel back, I think the ETG’s growth is going to be quite lumpy based on what we see in backlog right now. And I think with the ETG, if you’re counting on the organic side, look to the low to mid-single digits. FSG should be high single to double digits, something like that. It should continue a nice growth next year.
Michael Ciarmoli: Okay. That’s helpful. And then just back to the FSG margins, I guess, as you guys think about kind of the integration plans, Wencor had been running at 15.8%, give or take. Where do you think you can take those margins? And I know, Carlos, you called out a couple of times the amortization from Wencor to $11.8 million flowing through. But what was the other amortization as well that flows through there to kind of get to that 23%? Just want to make sure we’ve got all the math correct.
