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What were the key takeaways from TAT Technologies’s earnings call?

- **Revenue Growth**: 14% YoY to $46.2 million, fueled by strong demand and market share gains.
- **Profitability**: Record 14.6% EBITDA margin and 37% gross profit increase, driven by operational efficiency.
- **Balance Sheet Strength**: $47.1 million cash, 0.5x debt-to-EBITDA, and $170.7 million equity.
- **Strategic Moves**: New directors added to pursue M&A in underserved MRO markets.
- **Landing Gear Surge**: More than doubled YoY, with long-term contracts supporting growth.

**【CEO Summary Section】**
- Q3 2025 revenue grew 14% YoY to $46.2 million, driven by strong demand across core businesses and market share gains.
- Record EBITDA margin of 14.6% (vs. 12.4% in Q3 2024) and $6.8 million adjusted EBITDA, reflecting operational efficiency improvements.
- Backlog remains stable at $520 million, with year-to-date growth of $100 million.
- Strategic initiatives include adding 3 new independent directors to strengthen governance and pursue M&A opportunities in underserved MRO markets.

**【CFO Financial Commentary】**
- Gross profit increased 37% YoY, with gross margin expanding 410bps to 25.1% due to cost optimization and improved product mix.
- Operating income rose 52.6% YoY to $5.2 million, net income reached $4.8 million (vs. $2.9 million YoY).
- Cash flow from operations was $7.5 million in Q3, with 9-month cash flow of $9.5 million (51% EBITDA conversion).
- Strong balance sheet: $47.1 million cash, $12.1 million debt (0.5x debt-to-EBITDA), and $170.7 million shareholders' equity.

**【Q&A Key Highlights】**
- **Landing Gear Growth**: Revenue more than doubled YoY, driven by new E170 cycle contracts. Expect continued volatility but strong long-term trend.
- **Supply Chain Challenges**: APUs and landing gear still face long lead times, but thermal components supply chain stabilized.
- **M&A Strategy**: Focused on accretive bolt-on acquisitions in MRO and thermal systems to expand addressable market.
- **Tax Impact**: New U.S. tax legislation delays tax payments until Q3 2026, improving cash flow flexibility.
- **APU Penetration**: Early stages of 131 APU market entry, with RFP activity but no meaningful wins yet.


TAT Technologies Ltd. (TATT) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

TATT

TATT fundamentals

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