Q4 2023 Embraer SA Earnings Call

March 18, 2024

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Participants on today's conference call are Francisco Gomes, Neto, President and CEO of Embraer and Antonio Carlos Garcia, Our CFO. It is my pleasure to now turn the conference call to our CEO for Cisco Gummies. Please go ahead Francisco.

Participants on today's conference call are Francisco Gomes, Neto, President and CEO of Embraer and Anchondo Carlos Garcia our CFO. It is my pleasure to now turn the conference call to our CEO Francisco Gomes. Please go ahead Francisco.

Francisco Gomes Neto: Good morning, and good afternoon tool.

Good morning, and good afternoon to all.

Francisco Gomes Neto: Thank you and welcome to <unk> Q4, 2023 results conference call.

Thank you and welcome to Embraer as Q4, two added twenty-three results conference call.

Francisco Gomes Neto: In 2023, our commercial activity intensify it in all business units with solid demand in the company's main markets. We also had a great start in 2024 with an important to order from American Airlines that has driven our commercial.

Francisco Gomes Neto: In 2023, our commercial activity intensified in all business units.

Francisco Gomes Neto: With solid demand in the company's main markets. We also had a great start in 2024 with an important to order from American Airlines that has driven our commercial aviation book to Bill ratio above what the one for the year already in Q1.

Francisco Gomes Neto: Sure Aviation book to Bill ratio above one to one for the year already in Q1.

Francisco Gomes Neto: Last year supply chain delays negatively impacted our business. However, we posted double digit growth in aircraft the deliveries services and revenues.

Francisco Gomes Neto: Best year supply chain delays negatively impacted our business. However, we posted double digit growth in aircraft the deliveries services and revenues.

Francisco Gomes Neto: The strong increase in sales help to the company's backlog to surpass pre pandemic levels.

Francisco Gomes Neto: Richards $18 7 billion the highest number recorded in the last six years.

Francisco Gomes Neto: Has it Richards 18.7 billion the highest number recorded in the last six years.

Francisco Gomes Neto: And I am confident to say there is still much more upside to be captured in the near future for all business units.

Francisco Gomes Neto: The financial side, we always experiences greater results.

Francisco Gomes Neto: We registered a 30% increase in adjusted EBIT year over year and.

Francisco Gomes Neto: We registered a 30% increase in adjusted EBIT year over year.

Francisco Gomes Neto: And we generated more than 300 million in free cash flow in 2023 above our guidance.

Francisco Gomes Neto: And we generated more than 300 million in free cash flow in 2023.

Francisco Gomes Neto: Both our guidance.

Francisco Gomes Neto: I am pleased and proud to share that <unk> is back to investment grade rating.

Francisco Gomes Neto: I'm visits and proud to share that and Brad is back to investment grade rating.

Francisco Gomes Neto: All these results are a consequence of the execution discipline at the company is focused on.

Francisco Gomes Neto: Well, if we Richard important milestones in 2023 like the first prototype assembly.

Francisco Gomes Neto: Or if we Richard important milestones in 223 like the first prototype assembly.

Francisco Gomes Neto: The progress made so far makes us even more confident that easy is on track to develop the foundations for the global your buy and mobility markets.

Francisco Gomes Neto: The progress made so far makes us even more confident that easy is on track to develop the foundations for the global Uruguay and mobility markets.

Francisco Gomes Neto: Last but not least safety and quality.

Francisco Gomes Neto: Last but not least safety and quality our priorities in our strategy in our ever present in our culture.

Francisco Gomes Neto: Or it is in our strategy in our ever present in our culture.

Francisco Gomes Neto: I will present now the operational results of our business units in the next thing is lights.

Francisco Gomes Neto: Al will present now the operational results of our business units in the next thing is lights.

Francisco Gomes Neto: In commercial aviation revenues increase at an impressive 20% year over year to one point, a try 2 billion because of higher deliveries and product mix.

al: In commercial aviation revenues increases an impressive 20% year over year to one point H 5 billion because of higher deliveries and product mix.

Francisco Gomes Neto: The business unit registered a book to Bill in excess of one to one point to one.

al: The business unit you registered a book to Bill in excess of one to one point to one.

Francisco Gomes Neto: The highlight was the <unk> two family who is deliveries more than doubled from 19 aircraft <unk> 2022 to <unk> 39 in 2023.

al: The highlight was the E. Two family who has the deliveries more than doubled from 90 aircraft to 2022 to 30 90 into any twenty-three.

Francisco Gomes Neto: In addition in Q4 or three lines added.

al: In addition in Q4 or three lines added a firm order of 25 Embraer E 195 E. Two.

Francisco Gomes Neto: Firm order of 25, Embraer EUR 95 E. Two.

Francisco Gomes Neto: Commercial aviation delivered 64 aircraft in 'twenty, two 'twenty, three but registered a positive one 1% adjusted EBIT margin.

al: Commercial aviation delivered 64 aircraft in 'twenty two 'twenty three.

al: Registered a positive one point to 1% adjusted EBIT margin.

Francisco Gomes Neto: Without service.

al: Without services.

Francisco Gomes Neto: Or basically the same margin as in 2022.

al: Or basically the same margin as in 2022.

al: The adjusted margin Q4, Richard four 6% compared to $4 one quarter over quarter.

al: The adjusted margin Q4, Richard 4.6% compared to 4.1 quarter over quarter.

al: This active aviation resistors, a book to bill in excess of 1213 with a strong profitable backlog of <unk>.

al: It's active aviation registered a book to bill in excess of one to 1.3 with a strong profitable backlog.

al: $4 3 billion or 11% growth year over year.

al: On deliveries the business unit posted the largest volume in seven years.

al: 115 jets.

al: Or 30% more than in 2022.

al: Our 13% more than in 2022.

al: The Phenom 300 was again the worlds best selling light Jets now for 12 across active years. The most delivered dream Angels jets for the fourth consecutive year.

al: The Phenom 300 was again the worlds best selling light Jets now for 12 consecutive years in the most deliberate twin engine jet for the fourth consecutive year.

al: Executive Aviation presented a 9% adjusted EBIT margin in 'twenty, two 'twenty three versus 12, 2% in 2022.

al: Executive Aviation presented a 9% adjusted EBIT margin in 2023 versus 12.2% in 2022 a consequence of product mix and onetime tax benefits.

al: Consequence of product mix and a one time tax benefits.

al: Q4, adjusted margin ended at 15, 7% compared to 19, 3% year over year.

Q4, adjusted margin ended at 15, 7% compared to 19, 3% year over year.

al: In defense and security revenues, Richard a significant increase to $550 million.

al: In defense and security.

al: Avenue's, Richard a significant increase to $550 million.

al: Or 25% higher year over year, driven by higher <unk> hundred 90 volumes.

al: In 2023, South Korea was in the spotlight with the victory of the COVID-19, the public tender, becoming the first customer in Asia.

al: In 2023, South Korea was.

al: In the spotlight with the victory of the Citron 90, the public tender, becoming the first customer in Asia.

al: The branch hours affirming two important Mou contract.

al: And Brett also affirming two important Mou contract.

al: One with the Mahindra imager, and one with the semi in Saudi Arabia to become partners in the switching 90 sales campaigns.

al: One with Mahindra imager, and one with the semi in Saudi Arabia to become partners in the three to 90 sales campaigns.

al: The visit of units it presented a five 5% adjusted EBIT margin in 2023 versus two 4% in 2022.

al: The visit of units it presented a five 5% adjusted EBIT margin in 2023 versus 2.4% in 2022.

al: In Q4 2023, the adjusted margin ended at 228% comparative to further quite at 12% quarter over quarter three.

al: In Q4 2023, the adjusted margin ended at 228% comparative to father quite at 3% quarter over quarter.

al: Due to product mix and baseline contract adjustments.

al: Three to product mix and baseline and contract adjustments.

al: If we move to services and support in 2023, the business unit experiencing solid growth momentum.

al: We are now fit three new mro's dedicated to executive Jets in the U S.

al: We are off at three new Mro's dedicated to executive Jets in the U S.

al: The expansion doubled our maintenance capacity in the country and it should continue to support the growth of our customer base.

al: The business unit back.

al: The business unit.

al: Backlog ended 2023 with $3 1 billion, a 400 million growth year over year, the highest level on records reinforcing services grow as one of the main drivers of growth over the next few years.

al: Backlog ended 2023 with $3 1 billion, a 400 million growth year over year, the highest level on records reinforcing services grow as one of the main drivers of growth over the next two years.

al: We recorded a consistent double digit adjusted EBIT margin throughout the year, finishing at 15, 2% and 2023 versus 12% in 'twenty to 'twenty two.

al: We recorded a consistent double digit adjusted EBIT margin throughout the year, finishing at 15, 2% in 2023 versus 12% in 'twenty to 'twenty two.

al: In Q4, we had a 67% adjusted margin compared to five 7% in the same period of the previous year, mainly because of sales.

al: In Q4, we had a 67% adjusted margin compared to five 7% in the same period of the previous year.

al: Mainly because of sales.

al: Bad debt provisions.

al: Well, if the company had several significant achievements, but the selection of important suppliers and the start of assembly of its first full scale prototype.

al: The company had several significant achievements by the selection of important suppliers and the start of assembly of its first full scale prototype.

al: We also conducted a successful test of its eurobond air traffic management software in the U K.

al: He also conducted a successful test of its eurobond air traffic management software in the U K.

al: On the financial side, the company consume it less cash than expected in 2023.

al: An extra 12 months will be important for the company expects to perform the first test flight of its full scale prototype.

al: The next 12 months will be important for you there.

al: The company expects to perform the first test flight of its full scale prototype implants to start preparing its manufacturing facility for production.

al: And plans to start preparing its manufacturing facility for production.

al: I will now hand, it over to Antonio our CFO to give you further details on the financial results and I'll be back with closing remarks.

al: I will now hand, it over to Antonio <unk>, our CFO to give you further details on the financial results and.

Antonio: He will be back with closing remarks.

Antonio: Thank you Francisco and good morning, and good afternoon to everyone.

Antonio: I'm glad and proud to share with you our 2023 achieved.

Antonio: Driven by the continuous focus on business efficiency and innovation.

Antonio: And by the continuous focus on business efficiency and innovation.

al: We also reached our 2023 guidance for all financial indicators net revenue adjusted EBITDA, and EBITDAR and free cash flow.

Antonio: We also region, our 2023 guidance for all financial indicators net to revenue.

Antonio: Just a bit in EBITDA and free cash flow.

Despite a miss in commercial and effective aviation aircraft deliveries because of supply chain constraints.

Antonio: Despite a miss in commercial and the effective aviation aircraft deliveries.

Antonio: Cost of supply chain constraints.

al: Moving to slide number nine on deliveries.

Antonio: Moving to slide number nine on deliveries.

Antonio: Executive Aviation delivered 49 business Jets in Q4.

al: Active aviation delivered 49 business Jets in Q4, and a total of 115 aircrafts.

Antonio: And a total of 115 aircrafts.

Antonio: In 2023.

Antonio: 2023.

Antonio: The light jet segment was 12% higher year over year.

Antonio: And reach at the largest volume for the company in the past seven years.

Speaker Change: <unk> media guests.

Antonio: Additionally media guests.

Antonio: <unk> 40, 14% annual growth.

Antonio: Resistor, affording, 14% and off growth.

Antonio: Meanwhile, commercial aviation delay.

Antonio: Meanwhile, commercial aviation daily.

Antonio: <unk> delivered 25 aircrafts in Q4, and a total of 64 Jets ETF totaled 23.

Antonio: We delivered 25 aircrafts in Q4, and a total of 64 Jets ETF totaled 23.

Antonio: 412% year over year growth.

Antonio: In 2023, Embraer supplied and the 81 aircraft, including two military with Ctrip that 90 jets.

Antonio: In 2023, Embraer supplied and the 81 aircrafts, including 2 million terrorists secret hand that 90 jets.

Antonio: The total represents an increase of 13% when compared to the under 60 Jets Egypt totaled 22.

Antonio: This shows an improvement in the supply chain situation year over ear Bud.

Antonio: This shows and the Brewer mint and the supply chain situation year over ear Bud.

Antonio: But we continued to face some delays which have negatively impact.

Antonio: Our operational results and delivery guidance.

Antonio: The company continues working to mitigate the seasonality and production and deliveries over the coming quarters.

Antonio: Moving to slide 10.

Antonio: The company's backlog rose by $1 2 billion in 2023.

Antonio: The company's backlog rose by $1.2 billion, each have totaled 23 or <unk>.

Antonio: A 7% increase a year over year and the reach its a thought of $18 7 billion.

Antonio: 7% increase year over here and the reach its a thought of $18 7 billion.

Antonio: The highest number recorded six first quarter 2018.

Antonio: The highest number recorded six for squirt that should thousand 80.

Antonio: As active aviation and the 2023 with a resilient Powerpoint three been a backlog or a 400 million or 10% growth year over year.

Antonio: Executive aviation and the 2023 with a resilient Powerpoint three being a backlog or a 400 million or 10% growth year over year.

The backlog for defense security increased 100 billion or 4% year over year with the victory of the D. C 200 type Millennium East South Korea standard.

Antonio: The backlog for defense security increased <unk> hundred billion or 4% year over year with the victory of the Ctrip under tight millennial Aesop Korea standard.

Antonio: It is also important to highlight the aircraft was selected by the third Nate three NATO countries and this negotiation for <unk>.

Antonio: It is also important to highlight.

Antonio: The aircraft was selected by the third Nate three NATO countries and this negotiation for <unk>.

Antonio: 11, aircrafts have not yet be incorporating into our backlog.

Antonio: 11, aircrafts have not yet being incorporated into our backlog.

Antonio: Which has presented a significant upside potential.

Antonio: Which he presents a significant upside potential.

Antonio: For the upcoming quarters.

Antonio: In commercial aviation the business unit's backlog reached 298 aircrafts in Q4.

Antonio: In commercial aviation the business unit's backlog you reach at 298 aircrafts into four.

Antonio: Four 880 billion total.

Or $200 million or 2% growth year over year.

Antonio: Or $200 million or 2% growth year over year.

Antonio: And it does not consider yet they're 90 175, one units sold to American Airlines and the first quarter of 2024.

Antonio: And it does not cause C. The yet the 90 175, one units solely to American Airlines and the first quarter of 2024.

Antonio: This serves to support the backlog reached another historical required at $3 1 billion with a 500 million or 19% growth year over year.

Antonio: The service and support backlog reached another historical required at $3 1 billion with a 500 million or 19% growth year over year.

Our top line reached almost 2 billion in Q4, and you raised the yearly total to a $5 3 billion.

Antonio: Our topline reach it almost 2 billion in Q4 and erased the yearly total to a $5 3 billion.

Antonio: For a 16%.

Antonio: For a 60%.

Antonio: Growth rate year over year, therefore, I'm happy to share that we met the low end of our five point to two to $5 7 billion guidance range for <unk>.

Antonio: Growth rate year over year, therefore, I'm happy to share that we met the low end of our five appointed two to $5 7 billion guidance range for revenues.

Antonio: Revenues.

Antonio: Blue Camp There right chart in 2023.

Antonio: Blue can't there right chart in 2023.

Antonio: Commercial aviation represented more than 35% of their revenue.

Antonio: Executive and services support across Europe, 27%, each and defense around at 10%.

Executive and services support across your 27% each and defense around at 10%.

Antonio: Is slide 11.

Antonio: Is <unk> 11.

Antonio: The fourth quarter have an excellent performance in terms of adjusted EBITDA with $253 million and margins of 12 <unk> percent. Meanwhile, in 2023, we ended with a 562 million total and tame parent 7% margin.

Antonio: The fourth quarter have an excellent or pharmacy in terms of adjusted EBITDA.

Antonio: With $253 million and margins of 12 <unk> percent. Meanwhile, in 2023, we ended with a 562 million total and 10% 7% margin.

Antonio: Meeting guidance for the year, driven by volumes enterprise and tax efficiencies.

Meeting guidance for the year, driven by volumes enterprise and tax efficiencies.

Antonio: Is like 12 in Q4 23 at <unk>.

Antonio: Is like 12 in Q4 23, adjusted EBITDA was $182 million and digested a bit Maher, who was nine 2%.

Antonio: Adjusted EBITDA was $182 million and digested a bit Maher, who was nine 2%.

Antonio: Therefore for 2023, adjusted EBITDA reached 350 million and adjusted EBITDA margin was six 6%.

Antonio: Four four.

Antonio: 2023, adjusted EBITDA reached $350 million and adjusted EBITDA margin was six 6%.

Antonio: In line with guidance.

Antonio: These represented 80 medium increase year over year because of higher volumes across all business units and other operational income.

Antonio: We're represented 80 medium increase year over year because of higher volumes across all business units and other operational income.

Antonio: Consequently reported EBIT for the year, which includes M&A results.

Antonio: Consequently reported EBIT for the year, which includes M&A results total 340 million for a 6% Mark.

Antonio: 340 million for a 6% Mark.

Looking at the right chart executive Aviation and service and support we're responsible for almost 90% of EBIT generated during the year.

Antonio: Looking at the right chart executive Aviation in services and support were responsible for almost 90% of EBITDA generated during the year.

Antonio: Driven by higher volumes and double digit tomorrow.

Antonio: Meanwhile, the faith in secret it to represent at 7%.

Antonio: Meanwhile, defense and security to represent at 7% and commercial aviation Phys.

Antonio: And commercial aviation price.

Antonio: In slide 13.

Antonio: Slide 13.

Antonio: In Q4, if we exclude east we had an adjusted free cash flow generation of $684 million.

Antonio: In Q4, if we exclude if we had an adjusted free cash flow generation of $684 million.

Antonio: Our under Dominion higher year over year.

Antonio: And that means higher year over year.

Antonio: For 2023, we achieved 318 billion.

Antonio: For 2023, we achieved 318 million.

Antonio: Compared to $540 million year over year, because of investment and no recurring items we.

Antonio: Compared to 540 million year over year, because of investment and no recurring items we.

Antonio: We surpassed the guidance and the 50 million or more because of the improvement in working capital.

Antonio: If we move to investments in Q4 54 million were allocated to research and development and 60 million to Capex.

Antonio: Four.

Antonio: 114 million total invested compared to over 90 part meet them in Q4 to a digital if we exclude these Meanwhile, 2023 the company invested a total of 326 million of which 194 meeting we're investing in research and development.

Antonio: 140 million total invested compared to 94 million in Q4 to a digital if we exclude these Meanwhile, 2000 Twenty's read the company invested a total of 326 million of which 194 meeting we're investing in research and development and had a 32 million capex.

Antonio: 32 million in Capex in fiscal <unk>, or 82 million higher year over year.

Antonio: If we exclude these or 82 million higher year over year.

Antonio: We should highlight.

Antonio: We should highlight kept our location continues to be focus on segments with higher returns.

Kept our location continues to be focused on segments, where you have higher returns.

Antonio: With broad hits, such as expansion for our production capacity in executive Aviation and service and support.

Antonio: With broyhill searches exposure for our production capacity in executive aviation and service and support.

Antonio: About eve.

Antonio: I would like to remind you that the company reached the necessary milestones to begin the capitalization of development costs based on I F. R. S. Bruce in Q3.

Speaker Change: I would like to remind you that the company reached the necessary milestones to begin the capitalization of development.

Antonio: Development costs based on I F. R S. Bruce in Q3.

Antonio: I would like to finish this light at <unk> P. M. Both this important metric for the company.

Antonio: I would like to finish this slide talking about this important metric for the company.

Antonio: Return on invested capital ROIC.

Antonio: The momentum.

Antonio: In our V shape recovery continue.

Antonio: Our IQ reach at eight 8% to each of 2023.

Antonio: Our IQ reach at 8.8% each of 2023.

Antonio: More than 200 basis points higher than 2022, and similar to our cost of capital Roku.

Antonio: More than 200 basis point, you hired their 2022 and similar to our cost of capital Roku.

Antonio: Looking forward, our expectation is to increase ROIC to Delaware to use lyft.

Antonio: Looking forward, our expectation is to increase our ROIC to Delaware to use lib.

Antonio: Slide 14.

Antonio: Embraer posted 78 median in adjusted net income in Q4.

Antonio: Embraer bolstered 78 median in adjusted net income in Q4.

Antonio: For a three 9% adjusted margin or in.

Antonio: For a 3.9% adjusted margin or in.

Antonio: And 80% plus sequential increase.

Antonio: Meanwhile, we ended the year with $79 million and the adjusted net income totaled just at 1.5% Murray.

Antonio: Meanwhile, we ended the year with 79 million and the adjusted net income totaled just at 1.5% Murray.

Antonio: Consequently reported net income for the year, which includes deferred tax income total.

Antonio: Consequently report that net income for the year, which includes deferred tax income total.

Antonio: 60 for a medium for a three point to 1% Mark.

Antonio: Ah 64 medium for a three point to 1% Mark.

Antonio: Is like 15.

Antonio: We feel moving now to our liability management plan <unk> thousand 23, we reduced our gross debt without television by $317 million year over year.

Antonio: We feel moving now to our loved liability and management plan <unk> thousand 283, we reduced our gross debt to without television by $317 million year over year.

Antonio: Does net debt declined to 781 million each a total of 23 four down below <unk> rotated through.

Antonio: Does net debt declined to 781 medium each a total of 23 four down <unk> <unk> or 'twenty two.

Antonio: Consequently, we are happy to report the significant reduction in our leverage ratio.

Antonio: In the top right corner you can see we ended 2023, we felt 1.4 times net debt without even to adjusted EBITDA ratio are zero by Tonight turns below the two three times observed each a puzzle to institute.

Antonio: In the top right corner you can see we ended 2023, we felt one four.

Antonio: Four times net debt without the vitro adjusted EBT day ratio or zero by Tonight turns below the two three times observed each of <unk> thousand 22.

Antonio: Furthermore, we increased the aberration deputy maturity to four six years compared to $3 40 years year over year.

Antonio: Which has left the embraer to a very comfortable position or a cash of almost $2 4 billion with eve allowed us to cover all obligations beyond the 2030.

Antonio: Which has left the embraer to a very comfortable position or a cash of almost $2 4 billion with eve allowed us to cover all obligations beyond 2030.

Antonio: Last quarter, we mentioned.

Antonio: We were taking all necessary steps to recover our investment grade status today.

Antonio: We were taking all necessary steps to recover our investment grade status.

Antonio: Today, I'm very pleased and proud to share that down there and Bruce raced embraer two investment grade ratings.

Antonio: Today, I am very pleased and proud to share that Thunder and Bruce raced Embraer two investment grade ratings.

Antonio: And modes to only one notch below investment grade.

Antonio: At least Fitch revised the company's ought to look to a positive.

Speaker Change: Is like 16 forget to mention one important thing.

Antonio: It's slide 16, I always forget to mention one important thing, it's our 2024 guidance.

Speaker Change: Our 2024 guidance.

Antonio: We forecast commercial aviation should deliver between 72 to eight aircrafts.

Speaker Change: We forecast commercial aviation should deliver between 72 to eight aircrafts for an increase of 18% year over year using the midpoint of the range. If we consider ongoing supply chain cost rates.

Antonio: For an increase of 18% year over year using the midpoint of the range. If we consider ongoing supply chain close rates.

Antonio: Whereas active aviation, we forecast 125 to 235 jets and increase of 13% year over year based on the midpoint of their age.

Antonio: Our effective aviation, we forecast 125 to 235 jets and increase of 13% year over year based on the midpoint of the range.

Antonio: We are free to move to financials, we estimate copper lines to settle between six to $6 4 billion.

Antonio: We see a move to financials, we estimate copper line to settle between six to $6 4 billion.

Antonio: With the midpoint of the range, 18% higher than what we generated in 2023.

Antonio: In addition.

Antonio: In order to simplify the process, we are just giving guidance for the adjusted EBIT margin.

Antonio: We forecast these indicators between six five.

Antonio: And seven five for the year.

Antonio: Which would imply $434 million at the midpoint of the range.

Antonio: Finally, if you move into free cash flow, we estimate 220 meter or better for the year.

Antonio: Finally, if you move into a free cash flow, we used teammates to handle 20 meter or better for the year.

We will update our hatorade our guidance.

Antonio: We will update our hatorade to our guidance.

Antonio: Italy as the year goes by.

Speaker Change: With that I conclude my presentation and heading into back to <unk> for his final remarks. Thank you very much.

Speaker Change: Thank you Antonio.

Antonio: I'm proud to say 223 was a remarkable year for embraer.

Antonio: I am proud to say 223 was a remarkable year for embraer.

Speaker Change: It represented the start of a new cycle for the company the phase focused on sustainable growth to capture our full potential.

Speaker Change: It represented the start of a new cycle for the company B phase focused on sustainable growth to capture our full potential.

Antonio: The continuous focus on business efficiency and innovation as well as stronger sales reports were and will be fundamental to achieve the expressive results in 'twenty to 'twenty three 'twenty 'twenty four and years ahead.

Speaker Change: The continuous focus on business efficiency and innovation as well as stronger sales reports were and will be fundamental to achieve the expressive results in 'twenty to 'twenty three 'twenty 'twenty four and years ahead.

Antonio: In 'twenty 'twenty four we will celebrate embarassed 55th anniversary in a very good shape.

Speaker Change: In 'twenty 'twenty four we will celebrate embarassed 55th anniversary in a very good shape.

Antonio: We remain very positive about our strategy to grow and generate value for our customers shareholders and society through strategic partnerships business efficiency.

Speaker Change: We remain very positive about our strategy to grow and generate value for our customers shareholders emphasizing through strategic partnerships business efficiency innovation and ESG.

Speaker Change: Ovation and ESG.

Speaker Change: With all that said I am extremely confident about our 2020 for guidance and the brilliant future Embraer Hess.

Speaker Change: I'd like to thank you all again for your interest and confidence in our company.

Speaker Change: And with our company motto safe.

Speaker Change: Safety first and quality in everything we do.

Speaker Change: Safety first and quality all of us in everything we do.

Speaker Change: Well now begin the question and answer session. We ask screen test who is interested in asking questions at any time. Please press star then nine and the phone.

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Speaker Change: The first question comes from Marcelo Motta with Jpmorgan.

Marcelo Garaldi Motta: Please go ahead.

Marcelo Garaldi Motta: Hi, everyone. Good morning, Thank you for taking my question.

Marcelo Garaldi Motta: Hi, everyone. Good morning, Thanks for taking my question.

Marcelo Garaldi Motta: It is regarding capital structure, when we look at the guidance for 2024.

Marcelo Garaldi Motta: Regarding capital structure, when we look at the guidance for 2024.

Marcelo Garaldi Motta: We expect that our let's say being fly at EBITDA and the free cash flow generation, we are talking a ballpark on that debt to EBITDA they'll potentially be below one times right. So what.

Marcelo Garaldi Motta: You expected or less fitting fly EBITDA and the free cash flow generation, we are talking a ballpark on that debt to EBITDA they'll potentially be below one times right. So what.

Speaker Change: What is let's say the level of leverage that the company can operate does it means that our you know.

Marcelo Garaldi Motta: What is let's say the level of leverage for the company.

Marcelo Garaldi Motta: And operator does it means that our.

Speaker Change: You're targeting four zero leverage or could we see dividends buybacks or some.

Marcelo Garaldi Motta: You're targeting four zero leverage or could we see dividends buybacks or minority or some type of distribution. Our investments. So that is the question. Thank you very much.

Speaker Change: For distribution our investment so that is the question. Thank you very much.

Speaker Change: Marcelo Thanks for the question.

Marcelo Garaldi Motta: Martin Marcello Thanks for the question.

Speaker Change: Julian it's everything below two times, we're comfortable the way we are doing right now.

Speaker Change: <unk> ever seen below two times, we're comfortable the way we are doing right now.

Speaker Change: Is going to be below one which implies that.

Marcelo Garaldi Motta: Is going to be below one which implies that.

Speaker Change: Assuming that we're going through <unk>.

Speaker Change: Assuming that as we're going through <unk>.

Marcelo Garaldi Motta: Exhaust our cumulated, perhaps do we should be able.

Speaker Change: <unk>.

Speaker Change: <unk> do we should be able to.

Speaker Change: To resume dividend payouts in 2025 Walmart.

Speaker Change: To resume dividend payouts in 2005 Walmart.

Marcelo Garaldi Motta: First part.

Speaker Change: First part.

Marcelo Garaldi Motta: And the other parts.

Speaker Change: And the other parts.

Speaker Change: We are going to evaluate it.

Speaker Change: We are going to evaluate.

Speaker Change: Additional demand.

<unk> demand for the business units, who have a very rural like collective insertions warrant issue have additional needs for investment at least to tomorrow that is why we are today, but yes.

Speaker Change: The business units, who will have a very rural like because they could even start some support if you have additional needs for investment at least that's more or less where we are today, but.

Marcelo Garaldi Motta: Everything below two times. So we are going forward to work with and we need to zinc.

Speaker Change: Everything below two times, we are offer to work with and we need to think Oh.

Marcelo Garaldi Motta: We are going to move forward for new year's you can now choose this <unk>.

Speaker Change: We are going to move forward for deals you can now choose this <unk>.

Perfect. Thank you very much thinner.

Speaker Change: Perfect. Thank you very much on plan.

Marcelo Garaldi Motta: Marcelo.

Speaker Change: Hello.

Speaker Change: The next question comes from Peter <unk> with Bradesco <unk>. Please go ahead.

Speaker Change: The next question comes from Peter <unk> with <unk>.

Peter: Could they be please go ahead.

Peter: Alright, congrats for the results.

Peter: Just a quick question with New York.

Peter: A quick question with New York.

Peter: Phenobarbital, Jonathan before and what happened.

Speaker Change: In a volatile kind of planning for and what happened.

Peter: Yeah.

Speaker Change: In the fourth quarter.

Peter: In the fourth quarter.

Speaker Change: Uh huh.

Peter: When we take all kind of cash flow.

Speaker Change: When we take a look on the cash flow.

Speaker Change: And Brian with the rollout of our PDP.

Peter: And Brad we're serving a lot of our BD piece.

Speaker Change: And I forgot in this case you had.

Speaker Change: And I forgot in this case you do not have any impact from the new waterfall American Airlines. So so my question is you could make faster Sean.

Do not have any impact from the new order from American Airlines.

Speaker Change: So my question is you could make faster Sean.

Speaker Change: Predict repayments for and broke viewership PDP.

Speaker Change: Repayments for inbound Veeva soup PDP.

Speaker Change: In the first quarter or second quarter of this year. Thank you.

Speaker Change: Yeah.

Speaker Change: Thank you Wade for a question Tony speaking here.

Speaker Change: Thank you wait for question, Tony speaking here with Nomura.

Speaker Change: Nomura.

Tony: Dynamic Gulf or our cash flow, we become a positive last year does in Q4 is a lot of moving parts throughout the year.

Speaker Change: In the Gulf or our cash flow, we become a positive last year does in Q4 is a lot of moving parts throughout the year.

Peter: I'd say its too early to say that you are going to be better.

Tony: Say, it's too early to say that you are going to be better.

Peter: Additionally, when you're in our free cash flow guidance. He always we were able in the last three years to do better but for this tour that youll see because we do have also other tops ongoing right now we continues to grow each of the five.

Tony: Additionally, when you're in our free cash flow guidance. He always we were able in the last three years to do better but for sure. It youll see because he would do have also other tops ongoing right now we continue to grow each of <unk> <unk> five.

Peter: In some of our companies are effectively producing parts already for 2000 page, but deliberate.

Tony: Some of our companies.

Tony: Factory producing parts already for 2000 page five deliberate.

Tony: And assuming that the volatility to have if the advanced payments, we may see a difference in behavior and you. All know Q1 is going to be better but not in the way we should see that's why I would say what do we agree internally here as soon you have any more visibility you guys to the free cash flow.

Speaker Change: At Sony that the volatility to have it.

Speaker Change: Bundled payments, we may see a definitive behavior and you all know Q1 is going to be better but not in the way we should see that's why I would say what do we agree internally here as soon do you have any more visibility you guys to the free cash flow, we are going to adapt.

Tony: We are going to adopt.

Tony: The guidance and don't want to wait.

Tony: For the Q4 closing.

Tony: Summary, what I can tell you right now I would say the free cash flow at least can be higher can be seen as a I would say.

Tony: Summary, what I would tell you right now I would say the free cash flow at least can be higher can be seen as a I would say.

Tony: Conservative.

Speaker Change: Thank you.

Speaker Change: Okay.

Speaker Change: The next question comes from Katherine Yao has LNG with Eval Tpa. Please go ahead.

Speaker Change: The next question comes from Gabrielle his LNG with Eval PTA. Please go ahead.

Katherine Yao: Thanks, and good morning, Francisco Antonio and Gilead.

Gabrielle: Thanks, and good morning, Francisco Antonio and Gilead I mean, just a quick one regarding the supply chain risks. We saw your comments on Brazil journalists interview Francisco's interviewed on Brazil Journal.

Katherine Yao: Just a quick one regarding the supply chain risks we saw your comments on Brazil journalists interview Francisco's interviewed on Brazil Journal matching that supply chain issues somewhat improved in 2023 versus trying to send it to you I was just wondering how much of these potential issues regarding the supply chain capped yard delivery.

Gabrielle: Matching that supply chain issues somewhat improved in 2023 versus trying to send it to you I was just wondering how much of these potential issues regarding the supply chain kept your delivery guidance for China trying to farm. So these 80 aircraft in the commercial division could it be higher or if were not for the supply chain issues.

Guidance for China trying to farm. So these 80 aircraft in the commercial division could it be higher or if were not for the supply chain issues and what is the risk that are asking for a guidance right now regarding this particular variable.

Gabrielle: And what is the risk that are asking for a guidance right now regarding this particular variable.

Tony: Thank you Gabriel Francisco speaking thanks for question.

Francisco: Thank you Gabriel Francisco speaking thanks for question.

Gabriel Francisco: Well I think for the less but yes, both deliberate senior executive commercial would be higher if we had.

Gabriel Francisco: Well I think for the less part, yes, both deliberate senior executive commercial would be higher if we had.

Speaker Change: More cards from the market, but on the other hand, we saw improvements in 2023.

Gabriel Francisco: More cards from the market, but on the other hand, we saw improvements in 2023.

Gabrielle: In the supply chain in general and we believe we will see further improvements further improvements in 2024, but we still have some bottlenecks I mean important components that are limited.

Francisco: In the supply chain in general and we believe we will see further improvements further improvements in 2024.

Francisco: We still have some bottlenecks I mean important components that are limiting our our production we actually we made our plan basis on the conservative commitments.

Gabrielle: Our our production, we actually we made our plan basis on the conservative commitments.

Gabrielle: From our suppliers, but even then we are we have seen already some delay the beginning of the year.

Francisco: From our suppliers.

Francisco: Even then we are we have seen already some delay the beginning of the year.

Gabrielle: Our recent challenges in our oil production through but anyway, we are optimistic that.

Francisco: Our recent challenges in our production through.

Anyway, we are optimistic that.

Gabriel Francisco: And all of the numbers, we put in our guidance will be achieved this year in terms of production.

Francisco: The numbers, we put in our guidance will be achieved.

Francisco: This year in terms of production.

Speaker Change: That's very clear thanks Francisco.

Speaker Change: You are welcome.

Francisco: You are welcome.

Speaker Change: The next question comes from Myles Walton with Wolfe. Please go ahead.

Francisco: The next question comes from Myles Walton with Wolfe. Please go ahead.

Francisco: Okay.

Myles Walton: Apologies. Thanks, so much Antonio you mentioned capex potential investments as a source and area in executive and in services and the services piece, a I think I can understand with the expansion of the fleet and capture there can you talk about the areas of expansion and executive from a capex perspective.

Francisco: Or is it purely capacity.

Myles Walton: Or is it purely.

Francisco: Capacity on the on the larger aircrafts to the anticipation of something else to come and maybe put a quantification around it. Thanks.

Myles Walton: Capacity on the on the larger aircrafts to the anticipation of something else to come and maybe put a quantification around it. Thanks.

Speaker Change: Good morning, Myles Thanks for your question.

Antonio: Good morning, Myles Thanks for your question.

Speaker Change: So capex for executive Aviation, we we arent six one and a half years doing.

Antonio: So capex for executive Aviation, we we arent six one and half years doing.

Speaker Change: Some adaptation of our production capacity in order to be more efficient and also to support the growth.

Antonio: Some adaptation of our production capacity in order to be more efficient and also to support the growth.

Myles Walton: And we are continuing to grow with.

Speaker Change: And we are continuing to grow.

Myles Walton: With the book to Bill 12113, each one what we did already 2023.

Speaker Change: With the book to Bill 12113 to one, but we did already 2023.

Myles Walton: Therefore, it's just pacing booth, a completion safety audit should be Mariana budget tremendous forever work for elective and also to adjust for the capacity.

Speaker Change: Therefore, it's just pacing move a completion santee audit should be Mariana budget tremendous rebel work for an elective and also to adjust for the capacity.

Myles Walton: The MRO.

Speaker Change: The MRO.

Tomorrow side or in the services side is more expansion our MRO.

Speaker Change: Tomorrow side or in the services side is more expansion our MRO.

Myles Walton: Say organic growth that we are.

Speaker Change: Say organic gross debt to EBITDA.

Myles Walton: Fostering you right now.

Speaker Change: Fostering in right now.

Myles Walton: And on top of it for our new products.

Speaker Change: And on top of it for our new products.

Myles Walton: Is not there yet any type of decisions decision should be made if.

Speaker Change: Is not there yet any type of decisions decision should be made if.

Myles Walton: <unk> thousand five maybe Francis suite Amit.

Speaker Change: 2025, maybe Francis suite with comment after the lesson.

Speaker Change: Well, thank you very much.

Speaker Change: Thank you very much.

Speaker Change: Just to complement Antonio answered.

Speaker Change: Just to complement Antonio's Asher.

Speaker Change: In terms of new products, we are investing.

Antonio: Innovation, we are investing on seven interventional verticals.

Speaker Change: On innovation, we are investing on seven interventional verticals.

Speaker Change: In order to grow as the technology gets to be ready to go for a new program in the next future. We also made it you know as we do all the time and marketing studies and products studies.

Speaker Change: In order to close the technology gets to be ready to go for a new program in the next future. We also made you know as we do all the time and marketing service and products that as you know.

Speaker Change: In order to be prepared before for next steps for Embraer, but now we have a very young.

Speaker Change: In order to be prepared before for next steps for Embraer, but now we have a very younger and competitive portfolio of products developed in the no.

Speaker Change: And competitive portfolio of products developed in the no.

That has been used and really we are in a good moment and we want to sell those products.

Speaker Change: That has been used and really we are in a good moment, we want to sell those products.

Speaker Change: Yes.

Speaker Change: And improve our financial profile. So that's what we're doing but again, we are investing we have a pretty definitely new new technologies.

Speaker Change: Improve our financial performance. So that's what we're doing but again, we are investing we have a pretty definitely new new technologists and it was.

Speaker Change: No additional verticals.

Speaker Change: Okay. Thank you I'll stick to one.

Speaker Change: Thank you.

Speaker Change: The next question is coming from a telephone number with the end of 13 39, we ask for you to introduce yourself before asking a question. Please go ahead.

Speaker Change: The next question is coming from a telephone out there with the handoff 13 thirty-nine we ask for you to introduce yourself before asking your question. Please go ahead.

Speaker Change: Yeah.

Speaker Change: Yes, thanks, so much Cai von room or so.

Speaker Change: In your guide what is the relative mix.

Speaker Change: In your guide what is the relative mix within commercial between the ones and twos and as deliveries for <unk> for 24 and also in.

Speaker Change: Within commercial.

Speaker Change: Tweedy ones and twos and as deliveries for FERC for 24 and also in <unk>.

Speaker Change: In Biz Jets between light and mediums and also if you think about most biz jet makers make more money on larger jet and it looks like yours is reversed is there any opportunity for the profitability of the medium Biz jets to improve thank you.

Speaker Change: In Biz jets between lights, and mediums and also if you think about <unk>.

Speaker Change: Most biz jet makers make more money on larger jet and it looks like yours is reversed is there any opportunity for the profitability of the medium Biz jets to improve thank you.

Speaker Change: Hello, Weil and Daniel speaking thanks for.

Speaker Change: Hello, Hey, Anthony speaking thanks for your question, there's always very nice b from the commercial jets for 2024.

Speaker Change: And there's always very nice.

Speaker Change: From the commercial Jets for 2024.

Speaker Change: We are targeting 60% E Chu and 40% tier one in the mix.

Anthony: We are targeting 60% E Chu and 40% tier one then the mix.

Speaker Change: And four.

Anthony: Okay.

Anthony: Sure.

Speaker Change: For the executive aviation is more or less.

Anthony: The executive aviation is more or less.

Speaker Change: Uh huh.

Anthony: Uh huh.

Speaker Change: I'd like to get around the 55 and 45% to mid sized jet.

Anthony: <unk> gets around the 55 and 45% to mid sized jet.

Speaker Change: I would say.

Anthony: I would say.

Speaker Change: We are seeing a margin expansion for Victor aviation, but percentage wise or market is much better than in a light jets. The mid sized yet however, where we are growing much more it is under.

Anthony: We are seeing a margin expansion for the victory aviation, but percentage wise or margin is much better than in a light jets. The midsize jets, however, where we are growing much more it is under.

Anthony: And midsized, yes, and Thats why I would say, we shouldn't be able to get some.

Speaker Change: And mid sized yet and Thats why I would say, we shouldn't be able to get some.

Speaker Change: The margin improvement, but not as the same will happen the light jet for the mid size yet we do have more competition. That's why I would say in order to keep our.

Anthony: Margin improvement, but not as the same will happen to the light jet for the mid size that we do have more competition and that's why I would say.

Anthony: In order to keep our.

Anthony: Our guidance today, Mark do we are being a little bit conservative, let's say same margin, but we have much more dollars to come with the expansion production for the midsize jets. Thank you. Thank you very much.

Speaker Change: Our guidance today, Mark do we are being a little bit conservative, let's say same margin, but we have much more dollars to come with the expansion production for the midsized. Yes. Thank you. Thank you very much.

Anthony: Yes.

Anthony: Okay.

Anthony: The next question comes from Jordan <unk> with Bank of America. Please go ahead.

Anthony: Okay.

Speaker Change: Excuse me Sir.

Speaker Change: Excuse me, Sir we cannot hear you if you could please on mute your phone.

Jordan: We cannot hear you if you could please on mute your phone.

Jordan: So sorry about that can you hear me now.

Speaker Change: So sorry about that can you hear me now.

Mark: Yes. Thank you.

Jordan: Yes. Thank you.

Jordan: Great. Thank you.

Speaker Change: Great. Thank you.

Speaker Change: Sorry could you talk a little bit more about the read through on the United and the American orders for the 175 should we look at this as a ripple of new replacement opportunity for R. J's.

Speaker Change: Sorry could you talk a little bit more about the read through on the United and the American orders for the 175 should we look at this as a real put new replacement opportunity for R. J's.

Jordan: Yes, sure so let me.

Speaker Change: Yes, sure so let me.

Jordan: This new order shows to us that the debt markets of.

Speaker Change: This new order shows to us that the debt markets of.

Speaker Change: Regional Jets in the U S. If you're recovering.

Jordan: Regional Jets in the U S. If you're recovering.

Jordan: Although the pilot shortages into issues not the.

Speaker Change: Although the pilot shortage into issues not the.

Jordan: Resolved that the Mark this is recovering and this was the first important movement and this will be very important for us to meet their health to have a healthy mix of aircraft between <unk> and <unk> in there for years.

Speaker Change: Resolved that the market is recovering and this was the first important movement and this will be very important for us to make a help to have a healthy mix of aircraft between EUR any tools in there for years.

Speaker Change: So as he was considered to be the work horse in the.

So as he was considered to be the workhorse in the.

Speaker Change: Regional aviation is the U S.

Speaker Change: Regional aviation the U S.

Jordan: Francisco just to complement the United Nations. It was just a repositioning 20 units chamisa with just does not means a new backlog, but for sure. We do have interest from the other players in position for day, one even that are be competitors, who are saying that the regional market.

Speaker Change: Francisco just to complement to the United Nations. It wasn't just a repositioning 20 units chamisa with just does not means annual backlog, but for sure. We do have interest from the other players in positions for D. One even that are be competitors, who are saying that the regional market.

Speaker Change: But as you can see is not as that is more in line that too. We all believe and arguably are just confirming what we were saying in the last years.

Speaker Change: But to US as you can see is not as that is more in line that too we all believe and geography I'm just confirming what we were saying in the last years.

Speaker Change: Great. Thank you.

Speaker Change: The next question comes from Chi Tsang with Citi. Please go ahead.

Chi Tsang: Hey, Thanks for taking my question, it's RJ from Stephen Trust team. My first question is you guys have any updates on the sales campaign in and out of the U S.

Chi Tsang: Hey, Thanks for taking my question, it's RJ from Stephen Trust team. My first question is that you guys have any updates on the two sale campaign in and out of the U S.

Speaker Change: Well, we cannot disclosure robot sales campaigns, but Watergate garner better yes. We are working we are we are in conversations with.

Chi Tsang: Well, we cannot disclosure robot sales campaigns, but Watergate charter that then yes. We are working we are we are in conversations with.

Speaker Change: <unk> customers are key to us in the U S.

Chi Tsang: Official customers a few tools in the U S.

Speaker Change: Alright awesome. Thanks, and then my second question is regarding <unk> what are your thoughts on the certification process and were really considering that the FAA is probably under pressure right now regarding research commercial airlines incidents or just any color on that would be great. Thanks.

RJ: Alright awesome. Thanks, and then my second question is regarding Ive what are your thoughts on the certification process and were really considering that the FAA is probably under pressure right now regarding research commercial airlines incidents or just any color on that would be great. Thanks.

Speaker Change: You asked about the <unk> certification is that right.

Speaker Change: You're asking about the <unk> certification is that right.

Speaker Change: Alright, Okay, we are heavy.

Speaker Change: Important progress on new development.

Speaker Change: Barton progress on new uneven development I mean, the key suppliers.

Chi Tsang: Development I mean, the key suppliers.

Already defined for the product we are progressing well in the assembly of the first thick booklet back the path to scale of one to one that we expect to fly.

Speaker Change: Auto rather defined for the product we are progressing well in the assembly of the first thick booklet back the bulk to skew to walk the walk that we expect to fly.

RJ: End of this year beginning of next year.

Speaker Change: End of this year beginning of next year.

Chi Tsang: We are committed for the entry into service of the of the EBIT per hour heavy dose and two days of 2026.

Speaker Change: So we are committed.

Speaker Change: The entry into service of the of the EBIT per hour Healy, both two days of 2026.

Speaker Change: Awesome. Thanks, so much.

Speaker Change: You are welcome.

RJ: The next question comes from Fernanda, Hey, Ken Please.

Speaker Change: The next question comes from Fernanda. Thank you.

Fernanda: Please go ahead.

Fernanda: Hello. Good morning. Thank you for taking my question a quick one from my side could you. Please provide us an update on the arbitration.

Fernanda: Grocers with Boeing.

Grocers with buying.

Speaker Change: Thank you.

Speaker Change: Well, we expect.

Speaker Change: A resolution.

Speaker Change: In the first half of this year.

Speaker Change: In the first to get off this year.

Speaker Change: Perfect and just a follow up looking at Aaron's Tapeman, we can range closer to 300 million Edouard.

Speaker Change: Perfect and just a follow up looking <unk> taken on a weekend reached close to 300 million Edouard.

Speaker Change: Ah report came on ox Panther's claw carrageenan carve out.

Speaker Change: Report kimono expansive scorecard vino carve out shows.

Speaker Change: Sure.

Speaker Change: The discussion is closed or these number I know you could not scale.

Speaker Change: The discussion.

Speaker Change: Clothes show these number I know you could landscape.

Fernanda: Oney call any guidance on this but at least if we look at your financial statement are we comfortable closer to 300 million.

Speaker Change: Any guidance on this but at least if we look at your financial statement are we comfortable closer to 300 million.

Fernanda: Another is untarnished figure would be great. If they paid the sunquest, we haven't but is not lead and Laura hence.

Speaker Change: And that is untarnished speaker wouldn't be great decent they've paid the sunquest, we haven't but is not eat them Laura hence.

Speaker Change: Choose to take that decision and if you ask me personally I would be see more than that but its not the decision is not in our hands and we don't know in February to win or lose that's why it is difficult to give you any type of forecast.

Speaker Change: Sure. It should take that decision then nishu asking me personally I would be see more than that but its not the decision is not in our hands and we don't normally in February to win or lose that's why it is difficult to give you any type of forecast.

Speaker Change: Exactly just to complement and we are not counting on that money in any of our projections Fernandez.

Speaker Change: Exactly just to complement Andrew we're not counting on that money in any of our projections Fernandez.

Speaker Change #100: Perfect. Thank you very much.

Speaker Change #101: Perfect. Thank you very much.

Speaker Change: Okay.

Speaker Change #101: Yes.

Speaker Change #102: Our next question is from the chat.

Speaker Change #103: Our next question is from the chat.

Speaker Change #104: Please hold.

Speaker Change #105: Please hold.

Speaker Change: While we get the question.

Speaker Change #106: Will we get the question.

Speaker Change: Okay.

Speaker Change #106: Okay.

Speaker Change: The next question is from Lucas Barbosa.

Speaker Change #107: The next question is from Lucas that Boston.

Lucas Barbosa: Hi, Antonio fastest Glenn Gilead.

Lucas Barbosa: Hi, Antonio says is Guangxi, let me thanks for taking my question and congratulations for the result, my question is regarding business Jack.

Lucas Barbosa: Thanks for taking my question and congratulations for the result, my question is regarding business. Jack how are you seeing the entrance of new orders today.

Lucas Barbosa: Are you seeing the entrance of new orders today.

Lucas Barbosa: Hernia orders is there any niche market that the company is focusing more on such as corporate flight departments and Fractionals.

Lucas Barbosa: Hernia orders is there any niche market that the company is focusing more on such as corporate flight departments and fractional.

Speaker Change #101: And any visibility of how full the backlog of the competition is looking like thank you.

Lucas Barbosa: And any visibility of how full the backlog of the competition is looking like thanks.

Lucas Barbosa: Kim.

Speaker Change #106: Oh. Thank you for the question Lucas I mean, we're very happy with the performance of our sales performance of our business yet.

Kim: Well. Thank you for the question Lucas I mean, we're very happy with the performance of our sales performance of our business yet I may ask.

Speaker Change #106: As we mentioned in the opening Meow Oh.

Kim: As we mentioned in the opening MEO word.

Speaker Change #106: Our backlog today is at a $4 3 billion.

Kim: Our backlog today is at a $4 3 billion.

Speaker Change #106: The book to Bill.

Speaker Change #110: The book to Bill we ended the year after 1.321, even with the high high deliveries in.

Speaker Change #106: Ended the year at the one three to one even with the high high deliveries in the in the Q4 and.

Speaker Change #110: And in the Q4 and.

Lucas Barbosa: I think we have a help in the.

Speaker Change #110: I think we have a help in.

Lucas Barbosa: The mix in our Seo semi one third one third one third more or less.

Speaker Change #110: The mix in our Seo semi one third one third one third more or less.

Lucas Barbosa: Third for our corporate slide the bottom one third floor Fractionals one third floor.

Speaker Change #110: Third for corporates by the bottom has one third floor Fractionals one third for Ami are individuals in this and we have a great portfolio of products. I mean, just lots of additional 100 E X and the freighters that are Guinea.

Lucas Barbosa: <unk> individuals in this and we have a great portfolio of products I mean, just lots of additional 100 E X and the freighters that are Guinea.

Speaker Change #111: More and more.

Speaker Change #110: More and more.

Kim: The preference of the customers. So we are really happy in the uncomfortable with the the sales off where visa jazzed and we're confident that we have on the other we will have another great year of sales in that business unit.

Speaker Change #110: The preference of the customers. So we are really happy in the uncomfortable with that.

Speaker Change #110: The sales off where visa jazzed and we're confident that we have on order. We will have another great year of sales in that our business units.

Speaker Change #112: The next question comes from Kristine Li Wang with Morgan Stanley. Please go ahead.

Speaker Change #112: Hi, This is Gavin on for Christine Good morning. So I was just wondering if you could provide some color on how the DTF MRO at Agua is progressing.

Speaker Change #110: Hi, This is Gavin on for Christine Good morning. So I was just wondering if you could provide some color on how the DTF MRO at Agua is progressing.

Speaker Change #115: And if you can just give an idea of how much revenue and margin will be in 2024. Thank you.

Gavin: And if you can just give an idea of how much revenue and margin will be in 2024. Thank you.

Speaker Change #117: Can you. Please repeat the question the question.

Speaker Change #116: Can you. Please repeat the question the question.

Speaker Change #110: Yeah. So I was wondering if you can provide some color on how the DTF GTS MRO at Agua is progressing.

Speaker Change #116: Yeah. So I was wondering if you can provide some color on how the DTF DTF MRO at Agua is progressing.

Speaker Change #110:

Speaker Change #116:

Speaker Change #110: And if you can also provide color on how much of revenue.

Speaker Change #116: And if you can also provide color on how much of revenue.

Speaker Change #110: But did you give MRO alcohol will provide in 2024 as well as any color on margins would be great.

Speaker Change #116: But did you give MRO as well will provide in 2024 as well as any color on margins would be great.

Speaker Change #118: Yeah I'll start Ben has garnered can help me to comprehend all acknowledged peers.

Speaker Change #116: I was Scott's been a foreigner can help me to comprehend now acknowledged Girish Bell GTS rubra is moving very well I mean, the first delivery is managed before April one into funding the program and that program as well.

Speaker Change #119: Our GBM program is moving very well be the first delivery is planned for April Gordon through following the program and that program as we.

Gavin: We will be very important for the oil Hema Augie Meyers and Embarassed Bruce.

Speaker Change #116: We will be very important.

Speaker Change #116: Are they all Hema boggy Moss and Embarassed Bruce.

Speaker Change #120: <unk> will help us to more than double <unk> revenue in the next two years I would say and this will be a very very important.

Speaker Change #116: <unk> will help us to more than double <unk> revenue in the next two years I would say and this will be a.

Speaker Change #116: Very very important.

Speaker Change #116: Vector of growth for Akamai inflamed Brad.

Speaker Change #116: Backdrop growth for Akamai for Embraer.

Speaker Change #116: We'd like to add something about the moderating of growth.

Speaker Change #116: We'd like to add something about the Marty umbrella.

Speaker Change #116: With regards to <unk> the revenue side, we are more or less forecasting.

Speaker Change #116: <unk> regards to the revenue side that we are more or less forecasting.

Speaker Change #116: Around 40 million.

Dollars additional revenue for this year on the GTS, but.

Speaker Change #116: Dollars additional revenue for this year on the GTS.

Speaker Change #116: Assuming that we are in the ramp up we are not foreseeing any type of one Steve you might have new theories even light.

Speaker Change #116: Assuming that we are in the ramp up we are not foreseeing any type of positive you might get easier easy being light.

Speaker Change #116: Negative impact because here to start the red outlet law.

Speaker Change #116: A negative impact because here.

Speaker Change #116: To start the red outlets.

Steve: I would say the long term, we do see a higher single digit biopharma business.

Speaker Change #116: I would say in the long term, we do see a higher single digit smartphone business.

Speaker Change #123: Alright, great. Thank you.

Speaker Change #122: Alright, great. Thank you.

Speaker Change #116: The next question comes from Myles Walton with Wolff. Please go ahead.

The next question comes from Myles Walton with Wolff. Please go ahead.

Thanks.

Speaker Change #122: Thanks.

Myles Walton: So I understand another quick one if I could from a free cash flow conversion of EBITDA I think 50% five zero percent has been sort of your target level and obviously, you're guiding below that in 2024 I realize he said it was conservative to start but is five zero percent still the right level to think about over the <unk>.

Myles Walton: Tony I understand another quick one if I could from a free cash flow conversion of EBITDA I think 50% five zero percent has been sort of your target level and obviously, you're guiding below that in 2024 I realize he said it was conservative to start but is five zero percent still the right level to think about over the.

Speaker Change #124: Liam term thanks.

Myles Walton: Medium term thanks.

Steve: Yes, My instinct for requests you are totally right that that is more or less what.

Tony: Yes, My instinct for requests you are totally right that this is more or less what.

Steve: We are targeting generally minimal 50% of MB today, what we are facing the backlog is not a surprise maybe first for you is the volatility that we're facing throughout the year.

Tony: We are targeting generally minimum 50% of MB today, what we are facing the backlog is not a surprise maybe first for you is the volatility that we're facing throughout the year.

Speaker Change #122: That's why we are guiding.

Tony: That's why you are guiding.

Duane 220, plus.

Tony: Duane 220, plus.

Speaker Change #122: Plus it's really hard for example, a few weeks months.

Tony: It's really hard for example, a few regrets.

Myles Walton: Big amount of money in the last week of the year, that's why we prefer to be conservative, but internally, we are targeting a 50% RMB today, even in our longtime planning that's the minimum base that we're looking for.

Tony: Big amount of money in the last week of the year, that's why we prefer to be conservative, but internally we are targeting PS.

Tony: 60% RMB today, even in our long term planning that's the minimal beta that we are looking for.

Myles Walton: Okay, and one quick one if I could francisco the E. Two etops certification was that preventing you from competing in any competitions and does that open up new competitions that you see in the near term.

Speaker Change #125: Okay. One quick one if I could francisco the E. Two etops certification was that preventing you from competing in any competitions and does that open up new competitions that you see in the near term.

You mean the E two certification.

Speaker Change #125: You mean, they eat two certification.

Francisco: The etops certification for Europe.

Speaker Change #125: The etops certification for Europe.

Tony: For the E. Two.

Speaker Change #125: For the E. Two.

Tony: No I think we are moving well with the etops certification.

Speaker Change #125: No no I think we are moving well with the Etops certification and this will help us actually to improve the competitiveness of our alpha gal issues and and all to be more successful in the sales campaign. We are working on north of one of your own Europe with ours.

Tony: This will help us actually to improve the competitiveness of all of our resources and are known to be more successful in the sales campaign. We are working on not only on Europe with asthma as well as in all the other regions.

Speaker Change #125: As well as in all the other regions.

Speaker Change #126: Okay got it thank you.

Speaker Change #127: Okay got it thank you.

Speaker Change #128: Youre welcome.

Speaker Change #129: Youre welcome.

Speaker Change #130: Thank you all very much. This concludes today's question and answer session that does conclude <unk> conference for today. Thank you very much for your participation and have a good day.

Speaker Change #131: Thank you all very much. This concludes today's question and answer session that does conclude <unk> conference for today. Thank you very much for your participation and have a good day.

Speaker Change #131: Goodbye.

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