So just any commentary about, how to think about margins and whether you think you can get back, to at least at, or above the blended multiple from the merger or the blended margin?
Chuck Prow: Yes. So let’s – I actually wouldn’t characterize that in terms of former like Legacy, Vertex and Vectrus. However, the point that you’re on is an excellent point. At the time the merger was announced, the approximate cost type mix was 50%. And as you saw in this most recent quarter, we were 59% that is, that reflects both continued OPTEMPO and contract awards in our contingency contracts as well as we just, with the recent awards that $1.7 billion of aerospace contracts that we signed between Test Wing Atlantic Pacific and the most recent award that we announced here today. So, those happen to be also cost type contracts, but also in the very early stages of their life cycle. We’ve been very fortunate and blessed, to be winning things that above market rate.
It does take us an option year or two to blend those cost type contracts up with additional fixed price add-ons. So long-winded answer to your question, we remain committed to margin expansion the realities of our current portfolio mix play, a role in that and you know, between now and the time we announced guidance for next year. We’ll package that up very neatly, to include what we expect, to do with regard to our broader cost structure throughout ’24 into, into the future.
Bert Subin: Got it. Okay. Thanks, Chuck. And then just one last question, maybe on the leverage side of things. Can you just update us on what your expectations are, for net leverage in ’24? I think you guys used, to talk about getting two, three times or below three times. Is that still the goal, and during this quarter you paid down quite a bit debt, should we assume that cadence continues?
Shawn Mural: Yes. Hi, Bert. This is Shawn. Thanks for the question. So yes, finished at 3.46, relatively flat, right. Sequentially, the goal remains you know to get down to 3.0, or around it by the end of next year, continued – to continue payment of that debt, to help that position overall. So no, change from that.
Bert Subin: Thank you very much.
Operator: [Operator Instructions] Our next question is from Tobey Sommer with Truist Securities. Please proceed.
Tobey Sommer: Thanks. Just so, I understand the impacts on profitability you know in the quarter and guidance. Is there a lingering effect, or are you, have you normalized in terms of profitability relative, to your prior expectations post quarter and post whatever actions you’ve taken?
Chuck Prow: I would say that the activities that caused us, to not meet our own expectations for the quarter are behind us. As we mentioned on the call – performance related and we’ve obviously aggressively addressed them. We’re going to continue, to drive you go ahead I’m sorry.
Tobey Sommer: No. Please Chuck, you can finish.
Chuck Prow: I’m done. Back to you.
Tobey Sommer: Okay. And then relative to the variability of your clients’ needs, due to current events is there, does that represent more risk to what you had expected to occur, or is it a, you know a more evenly split set of risks and opportunities, depending on how things play out?
Chuck Prow: I would say on that, on that spectrum more opportunity with regard to volume and the risk will be in mix, because there are certain aspects of our business that, attract you know higher margin that, may not be as aggressively pursued by our clients, as they deal with the real world challenges that largely appear that through contingency type contracts.
Tobey Sommer: Okay. That makes sense. And then you had mentioned relative sort of lack of concentration of recompete risk next year, with nothing over 2%. Is the overall year, a below average recompete year, or are you just trying, to convey there’s nothing sort of hugely consequential that’s up for rebid?
Chuck Prow: Both points as we’ve been talking about this now for a while, we are again very fortunate and blessed, to be very front-end loaded on our backlog, because of the recent awards. So, I would say, even as we get into ’25, the recompete risk will be, kind of a lower than average, and that all kind of begins to normalize, into ’25 and into ’26.
