Sotirios J. Vahaviolos, Chairman, President, and CEO, MISTRAS Group, Inc.
Basically, as we mentioned, Tahira, since you mentioned Airbus, that is an area for us, because the A350 is coming into production. We hope that our German business, especially destructive testing will increase and be more profitable. In the case for instance in France that I mentioned, the EDF,Électricité de France,is a new business for us. We never had the nuclear business in France and now we are entering that area with a couple of small acquisitions. All of this thing will give us more. At the same time, in the United States and Canada, we will continue to be looking at opportunities as they come in front of us. In some cases, as we did in Canada, if we have to reinvest, we will try to invest.
Tahira Afzal, KeyBanc Capital Markets, Inc.
Got it. Okay. Then, if I look at what the CAPEX trends might be in oil and gas for the next couple of years, at least, clearly it does not look like a good picture. That means, whatever capacity is there, there is going to be more effort maybe plowed into maintaining it and etcetera, so that should play into your expertise. Can you talk a bit about areas you feel you can get bigger in potentially in terms of adjacent end markets like you have in NACHER, if there is more capital allocation towards really maintaining the current asset base on the oil and gas side?
Sotirios J. Vahaviolos, Chairman, President, and CEO, MISTRAS Group, Inc.
Well, of course,we are playing on the oil and gas, because that is 60% of our market, okay? At the same time, keep in mind that we have become a good player in the chemical industry, as well as in the power generation industry.
Tahira Afzal, KeyBanc Capital Markets, Inc.
Right.
Sotirios J. Vahaviolos, Chairman, President, and CEO, MISTRAS Group, Inc.
We will continue to be that. Aerospace also is in double-digits for us for the first time. Now, these are areas that five years ago we do not have. We are trying to basically continue to play on in the oil and gas, but at the same time diversify. I think it is the same thing that we have discussed the last couple of years, when you diversify, of course, sometimes you have to make investments and that is really what we have to deal with.
Jonathan H. Wolk, EVP, CFO, and Treasurer, MISTRAS Group, Inc.
Yes, what I would add to that, Tahira, is that, the investment we made in NACHER and the investment we are making in the organic growth in the Canadian oil sands. We believe we have an awful lot of running room in both areas. There is a big opportunity in both spaces for us that is incremental in terms of the growth perspective in addition to the areas Sotirios has spoken about. Really,we are not sitting here scratching our heads, worried about how we are going to grow. Most of the effort right now is really on maintaining and driving improved margins and profitability with the business as we grow.
Tahira Afzal, KeyBanc Capital Markets, Inc.
Got it. Again, last question on that and I will hop back in the queue. Jon and Sotirios, when I look at products and systems, clearly you are rationalizing and we are starting to see that on the margin side. When do we start on the revenue side, seeing sort of stable comps going forward? When should we look for that inflection?
Sotirios J. Vahaviolos, Chairman, President, and CEO, MISTRAS Group, Inc.
Basically as we are moving more and more not on capital projects, but things that people really need like I mentioned the area in the power generating business where they put a lot of information technology in their plants. That is where it is really helping our growth in the products. Our products really are not a commodity anymore, really solutions oriented kind of… we are really giving solutions for the customers and that generates the growth of our products. You are going to have this lumpiness that goes up and down based on the solutions that we provide, but at the same time, you have to remember that products is not a very high growth area for us or for others in our industry.
