Jay Malave: Sure. Just maybe a little bit more color. Just on top of the first flight that we had today the successful first flight, congratulations to our Aeronautics team there. We have over 20 aircraft that are currently in process in the production phase. We will deliver anywhere between, say, 78 aircraft this year, and then that will step up significantly in 2024. And so we’re on a good path that we recognize the opportunities that are in front of us. There are a few countries that have been announced there that we’re eagerly awaiting contract finalization, hopefully this year, with Jordan and Bulgaria. That’s about combined about 20 aircraft. And so the demand, as Jim mentioned, is pretty significant. And we’re ramping up as we speak to be able to deliver the customer requirements.
Operator: Next, we’ll go to Seth Seifman with JPMorgan. Please go ahead.
Seth Seifman: Thanks very much. Good morning, everyone. Jay, I’m sorry to waste a question on pension. But if we look at the CAS recoveries, it was about 30% of this year’s cash flow. And I know there’s discount rates and returns and all that stuff, but CAS tends to be much more visible than FAS on the income statement. So can you give us a multiyear outlook for the CAS recoveries over the next few years and where the balance stood at year-end?
Jay Malave: Yes. I mean — so for cash this year, as we mentioned, that will decline this year. I said about $100 million. Specifically, the CAS element will decline by about — the recoveries by about $75 million. We’ll see that decline a little bit more over the next few years as well. And so it will come down in the range, I think, around $1.5 billion, $1.6 billion over the next few years. And so that’s the best outlook we have today. As you know, these things are — they do fluctuate and a little volatile. So we’ll update that accordingly as we go and think about next year and what that means for 2025, Seth.
Operator: And next question is from Peter Arment with Baird. Please go ahead.
Peter Arment: Yes, thanks. Good morning, Jim, Jay. Jay, I wanted to just focus on Missiles and Fire Control. Just kind of obviously a little transition in growth this year, but profitability going to be down also looks like close to 90 basis points. Just maybe walk us through a little bit kind of some of the puts and takes there and just thoughts about kind of margin recovery as we think about the next couple of years where we’ve got all this growth inflected? Thanks.
Jay Malave: Yes. No, good question. This is something we talked a little bit on the third quarter call. We’ve got some new program awards, particularly in classified, that are going to put margin pressure not just next year but a few years beyond that as well. And it’s really just on the early phase of these programs as we head into production. It’s just low margin, and it will take time to have those restore to margins that we’ve seen in the past. What I will say is that we do have the benefit of some offsetting mix with the upside that we’re seeing in this business. I mentioned before a potential $6 billion over the next five years. Those will come with more solid margins will help mitigate the reduction that we’re seeing on these new programs.
But there will be some pressure there that we have to deal with. And look, the MFC team has a good track record of driving out cost, driving margins. I’m confident they’ll be able to do that in the future as well, but it will take a few years to get there.
Operator: Next, we’ll go to Kristine Liwag with Morgan Stanley. Please go ahead.
