Financial Data and Key Metrics Changes - Total adjusted sales grew 13% to $740 million year over year, with organic sales growth at 17% when excluding landing gear sales from the previous year [9][10] - Adjusted EBITDA increased 18% to $86.7 million, with adjusted EBITDA margins rising to 11.7% from 11.3% [9] - Adjusted diluted EPS increased by 27% to $1.08 from $0.85 in the same quarter last year [10] Business Line Data and Key Metrics Changes - Parts supply sales grew 27% to $318 million, with adjusted EBITDA of $43.8 million, up 34%, and adjusted EBITDA margin increasing to 13.8% from 13.1% [10][11] - Repair and engineering sales decreased 1% to $215 million, but organic sales growth was 8% when excluding landing gear divestiture, with adjusted EBITDA of $28.1 million, up 1% [11][12] - Integrated solutions sales increased by 10% year over year to $185 million, with adjusted EBITDA of $14.2 million, up 5% [12] Market Data and Key Metrics Changes - Adjusted sales growth to government customers increased 21%, while adjusted organic sales to commercial customers increased 15% [9] - Total commercial sales accounted for 71% of total sales, with government sales making up the remaining 29% [9] Company Strategy and Development Direction - The company is focused on driving growth through market share capture and new business, improving margins through cost efficiency, and increasing intellectual property through software investments [5][15] - The acquisition of Aerostrat is expected to enhance software capabilities and expand the reach of Trax software solutions [8][14] - The company aims to continue strengthening its offerings with targeted acquisitions to accelerate its strategy [15][16] Management's Comments on Operating Environment and Future Outlook - Management expects sales growth of 7% to 10% for Q2, with organic sales growth approaching 10% for the full fiscal year [15] - The company is encouraged by the additional assets coming to market, which is expected to drive growth in the USM business [31] - Management highlighted the importance of maintaining cash positivity while investing in inventory to support growth [37] Other Important Information - The company invested over $50 million in inventory to support future growth, particularly in parts supply [14] - Net debt leverage increased slightly from 2.72 times to 2.82 times due to organic and inorganic investments [13] Q&A Session Summary Question: What is behind the slight uptick in full-year expectations? - Management indicated that parts supply is leading the way with a strong quarter showing 27% organic growth [18] Question: Can you comment on the pipeline for new distribution agreements? - Management noted that the majority of recent wins have been from taking market share, with a different exclusive distribution model resonating well [19][20] Question: Do you expect to outgrow the market within distribution? - Management confirmed the expectation to maintain growth above market rates in distribution [24] Question: What are the cross-selling opportunities within repair and engineering? - Management stated that they are in the early stages of executing a cross-selling strategy, with a long pipeline of opportunities [26] Question: Has the trend in USM sales continued into the current quarter? - Management confirmed a meaningful growth in USM business, driven by a loosening supply of assets [31] Question: What is the margin opportunity for parts supply with more USM available? - Management indicated that while USM margins have been depressed, they expect margins to expand as more supply comes to market [32] Question: Is there an agreement with Aerostrat employees to retain key personnel? - Management confirmed an earnout agreement for key team members to incentivize retention [33] Question: What is the company's exposure to engine-related aftermarket services? - Management highlighted significant exposure, with 80% of USM parts being engine-related [41] Question: How far along is Trax in becoming a digital marketplace? - Management stated that they are actively investing in making Trax a digital marketplace, with announcements expected in the first half of 2026 [45]

Financial Data and Key Metrics Changes - Total adjusted sales grew 13% to $740 million year over year, with organic sales growth at 17% when excluding landing gear sales from the previous year [10][11] - Adjusted EBITDA increased 18% to $86.7 million, with adjusted EBITDA margins rising to 11.7% from 11.3% [10] - Adjusted diluted EPS increased by 27% to $1.08 from $0.85 in the same quarter last year [11] Business Line Data and Key Metrics Changes - Parts supply sales grew 27% to $318 million, with adjusted EBITDA of $43.8 million, up 34%, and adjusted EBITDA margin increasing to 13.8% from 13.1% [11][12] - Repair and engineering sales decreased 1% to $215 million, but organic sales growth was 8% when excluding landing gear divestiture, with adjusted EBITDA of $28.1 million, up 1% [12] - Integrated solutions sales increased by 10% year over year to $185 million, with adjusted EBITDA of $14.2 million, up 5% [13] Market Data and Key Metrics Changes - Adjusted sales growth to government customers increased 21%, while adjusted organic sales to commercial customers increased 15% [10] - Total commercial sales accounted for 71% of total sales, with government sales making up the remaining 29% [10] Company Strategy and Development Direction - The company is focused on driving growth through market share capture and new business, improving margins through cost efficiency, and increasing intellectual property through software investments [6][16] - The acquisition of Aerostrat is expected to enhance software capabilities and expand the reach of Trax software solutions [9][15] - The company aims to strengthen its offerings with targeted acquisitions to accelerate its strategy [16][17] Management's Comments on Operating Environment and Future Outlook - Management expects sales growth of 7% to 10% for Q2, with full fiscal year organic sales growth approaching 10% [16] - The company is well positioned in attractive segments of the growing aviation aftermarket, with unique distribution and repair capabilities [16] Other Important Information - The company invested over $50 million in inventory to support future growth, particularly in parts supply [15][37] - Net debt leverage increased slightly from 2.72 times to 2.82 times due to organic and inorganic investments [14] Q&A Session Summary Question: What is behind the slight uptick in full-year expectations? - Management indicated that parts supply is leading the way with a strong quarter showing 27% organic growth [19] Question: Can you comment on the pipeline for new distribution agreements? - The majority of recent wins have been from taking market share, with a different exclusive distribution model resonating well with OEMs [20][21] Question: Do you still expect to outgrow the market within distribution? - Management confirmed the expectation to maintain growth above market rates in distribution [25] Question: Can you discuss cross-selling opportunities within repair and engineering? - Management noted they are in the early stages of executing a cross-selling strategy, with a long pipeline of opportunities [26][28] Question: Has the trend in USM sales continued into the current quarter? - Management observed a meaningful growth in USM business, driven by a loosening supply of assets [31] Question: What is the margin opportunity for parts supply if more USM comes available? - Management expects margins to expand as more supply comes onto the market, although current margins are tighter than historical levels [32] Question: Is there an agreement with Aerostrat employees to ensure retention? - There is a three-year earnout associated with the acquisition to incentivize key team members to stay [33] Question: What is the company's exposure to engine-related aftermarket services? - Management stated that 80% of USM parts business is engine-related, indicating significant exposure in this area [41] Question: How far along is Trax in becoming a digital marketplace? - Management is actively investing in making Trax a digital marketplace, with expected announcements in the first half of 2026 [45]