Michael Lisman: Yes. It’s hard to say exactly. Like I just mentioned, we’re always looking at the capital deployment options, right? We’re doing that today. We do it quite a bit, obviously, monthly, and we want to be strategic with our capital and make sure we have enough at all times for M&A if it comes. And then also, it’s the shareholders’ capital. So we want to be efficient with it. And if we don’t find a use for it, give it back. With regard to the leverage ratio, we are at about 6x which is historically where we were in a lower interest rate environment. I think we’re — as I mentioned, we feel comfortable where we are today at the 6x level and given the benefit of the hedges. It’s hard to say if we tick up from here if we went and found a good acquisition candidate and use a little bit of debt, you could always do that, though you’d then be adding EBITDA.
So I think it’s safe to say going forward, given that we have the hedges and also that our interest rate hasn’t moved much because of those, it’s probably likely that we stay sort of at the 6x ballpark with some movement this way or that way, consistent with the last 5 years of history or so. But no real material change with the approach to leverage is expected.
Unidentified Analyst: Great. Then as a quick follow-up. You had mentioned earlier that you expect EBITDA as defined margin to kind of expand as we go through this year. Should we be expecting that expansion to continue in the out years? Or are we approaching a range where the margin will begin to plateau?
Kevin Stein: We are still navigating 2023. We’ll give guidance on ’24 and beyond when it’s appropriate. But obviously, our model is to keep, keep expanding, keep improving our business.
Operator: Our next question comes from the line of Andre Madrid of Bank of America.
Andre Madrid: I kind of wanted to take a look back at the supply chain. Obviously, there’s a lot of financial stress in the lower tiers. Do you guys see that as a room for opportunity when it comes to M&A? Just kind of wanted to gauge your outlook on that.
Kevin Stein: Not really. We don’t look to vertically integrate. We look to acquire phenomenal aerospace and defense businesses that we can further improve. Buying parts of the supply chain vertically integrating usually doesn’t meet our criteria for highly engineered, unique aerospace components with aftermarket content, and we like to stay very disciplined in that approach. That’s been the secret to our success, I think, in our M&A culture.
Operator: . Our next question comes from the line of Pete Osterland of Truist.
Peter Osterland: Just wanted to ask, how are you managing through the current labor market environment? Has attrition been manageable? Do you need additional hires to meet the growth you’re anticipating this year? Or have there been any challenges related to productivity?
Jorge Valladares: Yes, I’ll take that. I think generally, the teams have done a really nice job. We continue to focus on CapEx and productivity. Over the last couple of years, we’ve been able to invest in the business, and find different automation opportunities to take labor out of the process here and there. I think in general, the labor market conditions have been improving over the last couple of months. Most teams have plans in place to support potential OE production rate increases as we’re all hoping will occur. So I don’t see any significant issues. And I’d say, in general terms, it’s probably improved a little bit the last couple of months.
Operator: Thank you. At this time, I’d like to turn the call back over to Jaimie Stemen for closing remarks. Madam?
Jaimie Stemen: Thank you all for joining us today. This concludes today’s call. We appreciate your time and have a good rest of your day.
Operator: And this concludes today’s conference call. Thank you for participating. You may now disconnect.
