Q3 2024 Park Aerospace Corp Earnings Call

Presentation

Operator

Good afternoon. My name is Chanel, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Park Aerospace Corp. Third Quarter Fiscal Year 2024 earnings release conference call and investor presentation. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session and telephone. If you would like to withdraw your question, please press star then the number two. Thank you. At this time, I will turn today's call over to Mr. Brian Shore, Chairman and Chief Executive Officer. Mr. Shore, you may begin your conference.

Thank you, operator. And this is Brian. Welcome, everybody. And I wanted to just a matter, of course, you saw with us to our CFO, as usual, my Starbucks and also we'd like to take this opportunity to wish you and your families are very happy. New Year was the best two and 20 to 24. It is right. Yes, we just announced our Q3 earnings or I guess maybe 45 minutes ago. So you want to pick that up. And also in the earnings announcement, tours instructions as to how you would access the presentation are about to go through. You want to do that as well.
The presentation is pretty long. Sorry about that. I really was taken. I was just one I'm going to make it shorter. It ends up being longer. It's tough. It's hard for us are really for me because it just seems like sometimes are important things to cover. We don't do the sound bites. You know, we don't hire IR for do little clever kind of slip things. And I don't know why you'd want it anyway because I would think you'd want to hear from management. So we're not as polished takes a little bit longer on that. We take about 45 minutes or so to go through the presentation. So just to be advised on, we might skip through some of the items that though that we've gone through a previously, there are some items in this presentation, which are in the Q2 presentation as well.
So that might help us a little bit before we get started. I just really want to have a shot at the data because this Q. threes a bear for us because it just started our holidays are kind of a mess. We are not just a presentation. We're closing of our financial also met as well. We've done it ourselves. We do all the PowerPoint stuff. I don't I'm not even dangerous and PowerPoint again to it at all. So every third quarter, you know, she's working through holidays in before we get started. I note again, it's our Sydney, if you're in business will be our 70th anniversary is March 31.
So I guess what is that a couple of months off? There will be 70 years if we make it that far. What do we get going to slide 2 is our forward-looking disclaimer language. So we're not going to go through it. Please call us if you have any questions are asked to let us know if you have any questions. Slide 3, tables are not going to go through either. But if you have any questions about it, please let us know that's going to slide 4, take a little bit longer. So Q. three, let's go through security to sales $11 million -- [$11, 639 million] low number and to resolve the through the exploration of Q3 as well.
And look at the margins I highlighted we highlighted the margin is both the gross margins and EBITDA margins. You can see the comparisons on to Q2, which are not really favorable. But I think we tell you a lot we don't like it when we share gross margin fell 30%. So there's certainly below 30% this quarter. And our EBITDA margins are not really that a desirable for us anyway, either in our activations and thoughts about our Q. three. So what's going on here? While the and Emirates inventory burn down, which we talked about at great length in our Q2 call that continue through Q3 and we predicted when we did our Q2 call, we told you what would you predicted that? Is that Emirates inventory burn down is expected to continue into Q4? No, it's not. It's over and we'll get it into that the presentation, but it's no more burned down will we will discuss the inverse inventory burn down in greater detail and the President US rights presentation.
Let's go to Slide 5. Let's talk about the non-GAAP basis sales. We have we talked a lot about GE Aviation, not GE Aviation sales were only $7.5 million in Q3, and that compared to $9.4 million in both Q1 and Q2.
So that was off as well. So although there are almost always will be some degree of quarter to quarter variability in our business, the trend is actually quite good for non-GAAP sales. So we feel pretty encouraged about that. But what is the reason for or are the reasons for the quarter to quarter variability? There are numerous reasons, but for numerous reasons the programs are on, it will be active in one quarter or in may be an active another quarter. And we really have no control over that. There's very little we can do to control the timing of when programs were that we are on will be active or inactive, and it would really be a waste of time even tried to do that exercise in futility as we say here. But a park. The thing is we focus our energy and efforts I getting on new programs, which we believe will be supported by our long-term objectives rather than attempting to control the timing of programs already on.
So let's keep go on Slide 6. But nevertheless, this quarter to quarter variability does come with less than optimal visibility, often effect, and it does require us at par to be very agile and fast sinter feed their supply chain with our inventory in our production management activities. So were there any new optical to completing sales in Q4? Yes, there were actually and we'll get to that in a minute. But let's not talk about the bottom line. Talk about the top line on why the margins in Q three lower than Q2, and we already shows the comparisons. Well, there's a few recent, the last several levers, a less favorable sales mix in Q3 compared to Q2. Q2. The sales mix actually is quite good. Q3, not quite as good, but as explained above, we have little to no control over which programs are active and which programs are inactive on a quarter-to-quarter basis. That's kind of rolling the dice will have been if you look at it short term, what was a higher margin progress? The active in the quarter were less active that we have almost no control over.
Again, our objective is to get a more programs. The ones that we think are good programs, the margin probably a better margin programs and the timing is up to you know that the customer guide or was something outside of our control on the second item was lower sales. We had talked about in Q2 that affects our bottom line and to lower sales in Q3 compared to two. That affects our bottom line, of course. And there is a big one, even though we fully anticipate that Q3 sales were going to be light compared to Q2.
We intentionally ramped up our costs in Q three, the need to reduction requirements of expected key program ramp up. So that was something we decided that was intentional, and we'll talk about that number two additional again throughout the presentations. When we go on to slide 7, yes, we saw that freight train coming. That's a good analogy. We use in our Q2 presentation, the freight train coming, meaning the program ramp-ups want to make sure we are ready, low, ramping up our cost, took some conviction and maybe some thoughts a little bit anyway.
So it's hard when you see, you know, that's not going to be a good sales, good quarter, sales-wise to ramp up your cost of the turns out. We know for sure right with the benefit of hindsight to do what we did ramping over costs in Q2 three, and we'll explain that as we go into presentation. So one, it was a good move in our part, I would say to do we did other considerations related to q three on how things go well with supply chain staffing, freight, disruption, new, we talk about just what you might be tired of hearing about it, but we're sometimes continue, but I seem to be improving to some extent or maybe there's more that we have become more effective with dealing with them.
Now I just wanted to point out we're not talking about supply chain issues for us. All industry. We're talking about our supply chain. Whole industry will talk about later on if that's probably more of a fact after for our for us anyway. In terms of the on the opportunities you news three and how they're affected by supply chain constraints on international freight? Well, that's a little bit different story. There's that Ward and Middle East, which occurred after the end of our do you have to end of Q2.
But I guess during the first part of Q3, which we didn't see coming, that's causing serious disruption and challenges for international freight corrupting, sorry, slide 8, disrupting shipments to customers in the Middle East and Asia, yes, we've got customers, Turkey and Israel important customers. So you can only imagine what kind of chaos that is that we also have customers in Asia where there's not a war in Asia, not yet anyway, and hopefully also stay that way. But nevertheless, that, you know, the seafreight goes through those through the middle that's through the faulty go through the Middle East. I guess now it's going through that. But what does it do for us of Africa? It's a way out of the way. So that's not a lot of fun toll mill shipments, acute rate by $560,000. I don't have in front of me, but I think was only about [$220,000] and Q2.
So in other words, the Q2 where we really get much better, but we have a big setback in two three. That's almost all related to international freight disruptions on, so undergo our margins. Lcr margins can be affected by inflation. I know inflation is what do you all gone, but we're not I don't buy that. And the cost and calculate operating our recently commissioned new plant and student Kansas, this is all planned and expected. But obviously you don't turn a plant data and you're at full capacity side how it works on.
Let's go on to slide 9, okay. This is our historical fiscal year, our results and for perspective, mostly past, let's talk about it than I normally don't spend much time this one, looking to sales in 17, 18, '19, '20, I could keep going up by $10 million or $31 million, $40 million, $51 million, $60 million, really nice. Then what happened is this a little think we'll have pandemic. So finish sales were really badly affected 21 and clade two 23, 24. If you look at our forecast on slide 36, 24 is going to be our forecast is be something like 23 like $55 million line, $11.5 million EBITDA.
So we got three years where we just we have been able to break out the pandemic, the disease parties mostly over. But boy, did we screw up the the global economy, supply chain staffing, we have the supposedly full employment by so many people left the workforce. I don't know how that problem gets solved. Regionally, you probably know better Nigel's issue, but on of at least from my perspective, it seems like a problem that may not get totally solved so easily.
Anyway, if you look at our top line numbers, you can kind of see the pattern there. Now we're hoping and we have reason to hope that we're going to start to move that to start to add that growth dynamic kick in, again, starting in this fiscal year, return to the growth dynamic. But let's go ahead and let's talk about what's going to slide 10. Okay, quickly. In this one, we will cover our balance sheet and dividend stuff. So we got zero long-term debt, $74 million of cash to repay sorted. But don't forget we there's nine point sorry, $9.3 million of remaining transition tax installment payments payable through to 25. That relates to repatriation tax. I think it was based on the Trump tax on law, which was very good for Park.
But nevertheless, we have some installment payment. So you could think about how you like we kind of think about that is almost like debt like we all that money. So we think of our cash, we think, well, you know, we've still got to give $9.3 million of some these transition tax installment payments to the government. And that's in addition to our regular tax payments, which were not talking about dividend. Yes, you know, but our dividend, we paid a lot dividends paid for a 8 years, $588 million since in 2005. And like I would like to say that's a hell lot of money for a little company like Park.
So on to Slide 11, just kind of a reminder, 2022 of the Board authorized a buyback of 1.5 million shares. We purchased about 221,000 shares. So far it looks like we have about a was it 1,279,000 shares. Sylvain will be purchased under utilized through authorization. We're not saying we're going to buy stock or not, but we just want to remind you that the authorization is out there just to remember that this go on to slide 12, okay.
Every quarter we have to tell are you about our top five. This is a slide that Donna prepares. We do a nice picture of one of the programs that the with these customers run a aerospace. So there are a contractor for Aerojet and the Aerojet related apoC-III missile. We talk about a lot ArrowSphere, here's their contractor for is really the aircraft, and that relates to the G to 80. So that's at Gulfstream airplane.
But Gulfstream has some contract with is really aircraft under which is really aircraft produces the G to 80 airplanes create ocean, all. But cradles, we talk about what was I think every quarter featuring this. And this Meikle unmanned tactical drone, Middle River hit every quarter, of course, some 47 eight. So I think our favorite airplane and then Nord, and that's the global study, 500 data and make some components for are the engines for the Global 7,500 with our materials.
Let's go on to next slide, Slide 13. In my pie chart, I always like these animals, they are useful to you. But I kind of think their colleagues genomes, habitat messages in them. And if you look at the first nine months of this year, say commercial a little bit off as compared to the prior two years, and that would be based upon what would be that burned down. That's causing commercial to be a little bit like in the fiscal 2020 for first nine months. Pie chart.
Let's go on to Slide 14. Excuse me. So Park laws, niche military aerospace programs. This is a lane is project every quarter come up with some kind of find interesting and cool examples of new military programs, run the pie charts, interest saving. Let's talk about that for a second. Rocket nozzles, drones structures, those sorry, right owns those are niche markets for us. But even structures, we consider to be a niche market quickly into space ex of Falcon nine launch true with Dragons, scrap materials and in blue is the Northrop Grumman E-2D that's parts and materials and bolted Blackhawk and unlock a G5 to had very good kind of aircraft, but those are multiple materials and the M. and K. 66 Vertical Launch System Nessa for the Navy. And those are blade of material.
Let's go on to Slide 15. So let's talk a little bit about trends in the aerospace industry, commercial aerospace markets, domestic air travel report that fully recovered, and that's good news for single aisle like day through 20 neo aircraft. International travel is reported to be approaching pre-pandemic levels. Also very good news, good news, long-haul wide bodies like the Boeing Triple seven Nexium buys piece. I keep talking about programs we're on and not surprisingly, demand for commercial aircraft is very high.
Supply chain labor shortage challenges continue to be the biggest headwind for the commercial aircraft industry. But there are recent reports of supply chain stabilization and improvement. And but tell you what we're not actively events we'll see, but that it seems like it's inconsistent with some places, maybe better, some places, maybe not better. But notwithstanding these ongoing supply chain constraints, many now believe that 2024 will be the year with the commercial aircraft industry breaks out Iran.
So production orders beginning every year, calendar year is always the prognosticators and it grows at staff that have or by two reports, but average number of them recently, aerospace analyst types that are saying that this year maybe a year that commercial aircraft industry really breaks down and kind of past the supply chain and constraints will see about that. But I think there might be some reason to be optimistic. Let's talk about that.
Let's go to Slide 16. Recent impressive ramp up of a through 20 neo family aircraft deliveries that just not product application. And these are facts on us, and we'll get to that slide 21 to 22 regarding that delivery ramp up is supportive of that. You should use data and 20 neo family aircraft deliveries as a proxy for commercial aircraft industry. I don't know, but considering that that program is expected to be the largest commercial aircraft program in history universe. And I'll maybe we should consider using as a proxy, no military markets proxy for the for the industry breaking out, let's call the commercial market if the industry military markets.
So the global demand for military defense hardware, including missile and missile defense system, such that the factory missile, again, we kind of bias. We talked about programs run quite high and elevated by the wars a screen attention is in the globe.
That's going to slide 17 also.+ Hi, Lee, level of interest in unmanned and potentially autonomous systems such as day, Kratos' Valkyrie and what's going on here on my own mind expert, but I'm just wondering if you got missiles and missile defense drones, maybe this is to avoid boots on the ground so we could do awards without getting people in the middle of them. I know it's kind of a cynical way to look at it, but you probably have a more enlightened opinion. I do. The markets for military defense hardware also affected in some cases constrained by international political and budgetary factors. We read about that stuff. And in some cases, supply chain and labor constraints continue to limit the ability of military defense OEMs to meet the demand, the market demand for the hardware. Little picture of the Valkyrie here, which is nice in the last item on this slide, we're on Slide 17. December 17th, 2023 was a 120th anniversary of the right price Brothers first powered flight. So happy anniversary aerospace industries.
Let's go on to Slide 18. Their presentations. We this is as we go through this every quarter, is this just kind of give you context to GE Aviation programs really important. And we talk about them suggest background, we're not going to go through the programs. We have a firm pricing LTA through 2029 with Middle River Aerostructure Systems, a sub of ST Engineering Aerospace. What does that? I don't get that these all these programs are GE Aviation programs. So which one on your well, what's going on here is when we got in these programs, Middle River MRS, which is all Tom Martin, Glenmark company and Baltimore, then Lockheed Martin. Anyway, there are part of GE Aviation bill and we got these programs thereby achieve nation. I don't know if I remember about four or five years as you I'm not sure. I remember GE Aviation sold MRS to SDN hearing aerospace, which is large Singapore aerospace company. But we're still supplying into those GE Aviation programs that actually the redundant factory. That was an agreement we reached with GE Aviation and build that are done factory. They wanted to return to see you serve kind of betting the farm with us being sole source on each project.
So I won't go through the programs. You have any questions about to let you know, let's go on to Slide 19. The first two items. Again, programs are not going to go through them. Just let us let me know for let us know if you have any questions. U.s. third bullet, Arrow item, AmRisc, all of us, free Park proprietary film, and he's a formulation to product forms and progress. That's new. That's interesting and very bright for Park Park. Amerus LTA through 2029 recently amended to include the three Park somewhat easier product forms and for composite bond metal mine. That's really great for Park life of program agreement requested by our math. Yes, NSDE., they both said yes, 29 is nice, but we need a commitment for a long run that Sony agreement is in progress. What's that agreeing work?+ The Park, I don't know, Tom, maybe you might what does that is slide 38. It has the let me see if that's Slide No. 13. Yes, 38 has the analysis of the revenues, annual revenues for the GE Aviation programs type of program. I know you tell me until 2045 done 50 of these airplane programs just starting. So we feel lucky.
So fortunately, the programs are on our new programs are going to go a long, long, long, long time, very lucky that seven 47 that that program mandates. So that's sad. But the probably the other programs right now have a long way to run Slide 20 on, okay, we're going to go through some programs. So trying to skip through some nicer skim over it because we covered every quarter's, let's cover the high points. First of all, acreage, Wendy Nieto, that's the big dog. That's the big one that includes this whole eight or 20 neo family, huge backlog, huge 6,752 per airplane. That's backlog. That doesn't include the old airplanes that have been shipped on Airbus, continuing to say they're going to be at 75 per month production and deliveries in 2026. Second to make it there.
Let's go on to Slide 21, let's think about that. So how is that by doing so far with their planned through 20 neo family aircraft production ramp up pretty well, actually according to reports by 73 deliveries and 20 and December will that's a lot of an average of 57 on a per month in Q4 of 23. That's a lot. And 563 total in two three and 20 sorry, calendar year 23. That's a lot. That's an average of 47 per month in calendar year 23. Let's get some perspective. What's the history ATTR-CM, what's going on or they're ramping up to independence? Let's talk about when we talk about per month. So 18, 32 per month, 19, 47 per month. And so we got to pandemic 20, 36; 21, 38; and 20 to 43. Here by said, you wanted to maintain 40 through the pandemic. They are almost got there a little bit light in 2021, but did they did keep some production going good for them.
Now let's take a look at something else. So it was for 563 and 23, 561 was a big year before. Sorry, 19 with 561 was there a big year for 23, five 61, which is a big year for that kind of says you things are getting past the pandemic notwithstanding, will supply chain stuff and everything else that's holding things back. And the other thing you want to look at is that it wasn't level at at 47 per month through calendar 23 to 73 in December 57 last quarter, as I would say, yes, during the year, things are moving up in a lot to see how things work out as we go forward. I think there's a actually a comment about that.
Let's go on to Slide 22. So for the first 23 or 23 for the first time since the beginning of the pandemic, Airbus is able to return to those same three 20 neo family aircraft production until delivery rates to those pre-pandemic rates, a very high political like vitality, I guess, a very key milestone accomplishment for Airbus. Good for them.
Now this is what I was thinking about. You could be money monthly ups and downs. There will be month monthly ups and downs of or a three two zero neo aircraft family deliveries. That's quite apparent, at least to me. Anyway, that ramp is really not going away?+ No, I wouldn't be surprised in the first couple of months of the 24. And I don't know. I mean, I know you said information speculating could be a little light, but that's how often is did you say that pushed a lot of airplanes at the end of the year?
Clearly, based upon the huge backlog, OIA., which would be producing these aircraft and rate of 75 per month already, if not for supply chain constraints. And by the way, just define core Newport's Airbus booked to under 57 new orders in December of 23. That's a lot of new orders booked an unheard of 1,693 new, a true 20 family aircraft orders and 23. That's those are just incredible numbers. So fortunately on that program, just luck really, I guess on slide 23, what about those engines, though, for the eight through 20 neo? Boy, we lead with China Life. I tell you. So remember that there are two approved engines for they grew 20 neo, the LEAP-1A and Pratt 1,100 G. GTF engine.
And we are only supply into the LEAP-1A, not to Pratt talking about lead time lags because the LEAP-1A market share's been hovering about 60% for last couple of years. That's going to slide 24 than what happened that all changed. Leap-1a broken out as the clear market share winner. Thank you. 20 court into this December 23 addition of aero engine new wins that are viable for new huge amount of data. And this month, the publication, CFM LEAP, when a market share firm orders through 20 neo aircraft only 65.6% as of October 30th First, while how the heck did that happen, I think there's just so much ballots and market share with over 12,000 for I mentioned orders during the two engines, how you are 60% out ahead, do you get to 65.6% in just a couple of months? It's incredible at the delivery rate of 75 bakery neo family aircraft per month. That 65.6% market share translates into 1,181 LEAP-1A engines per year. What's it worth to park will talk about it in slide 38, we'll get there. Slide 25.
So there are also currently 8,150 firm LEAP-1A engine orders. That's a lot of engines. one of those orders worth to park. Looking at slide 38, but you know, you probably say about a quarter billion now just a couple of things that that's going to be deliveries past 2029. So that assumes that we're still in a program for that. My guess is we will be and I will suggest that the pricing might go up a little bit after an extra 2030. So but just kind of round ballpark numbers that we want to talk about labor programs at 2045 to 2050, you could do that math on the Navy to go there. So what happened? Why did the market share? I first mentioned orders shipped all broadly dramatically in favor of the LEAP-1A engine. So we talked about this last time. I won't dwell on it too much to all the news. You read about yourself, serious issues with the Pratt 11 energy engine have been extensively reported, so we're not going to cover them here again.
So why don't we just go on to Slide 26? The top by that is actually new ones. So we'll talk about that. Fa just published new proposed rule in December 11th, 23, Ricard inspection of additional Pratt 1,100 key parts, which could be affected by the powder metal issues. That's kind of new news for the full implication. Patient is hard to say will lead to a I don't know. What do you think of Meanwhile, just Meanwhile, CFM's playing for Indus upgraded components, LEAP-1A engine, you see what's going on your price really struggling you have to feel sorry for them and the really difficult problem. oh, and then the other hand, LEAP is kind of making improvements to their engine to actually improve durability.
Let's go on to Slide 27, please. Continuing here on the update. So just still in that eight through 20 family, the AC Re 20 XLR variant, so to be entered, sir, there is a second quarter of 2024 at pretty much around the corner. That's really nice. That's exciting for Park, good news. So Comac nine one nine. Let's just skip down to the last couple of items. They recently made its first flight outside Mainland China, and we got to put a brand is Hong Kong. So I don't think that unless through that, consider Mainland China, I think it might be. But anyway, it's this news version of these commercial airplanes are thought of as mostly versus new Chinese domestic market. They recently unveiled a stretched and shorten Varian end of the airplane lease plants to produce.
And so that's really exciting. So CoolMax not sitting still there do more development work with this aircraft type is going to 28. Another Coal-Mac Chinese Komag aircraft, which is a regional jet and less tech item called Macrovision deleverage. Just two years ARJ 21 converted freighter aircraft, which nice and Coal-Mac held this as a solid step forward for China's aerospace sector history buffs, you know, does that sound like anything to you every one of the great leap forward? Do you think that's a coincidence? I don't know. I have no idea. Just when I read that, I thought well, it kind of sounds good to great leap forward, if you don't know, but document will look it up.+ Let's go on to Slide 29. So a couple of have an extra aircraft.
Yes, this is an exciting program for Park and it's starting to actually happen. We expect to ship approximately 2 million of material first program and counter 24, but we said it will be certified 25. They're building ahead, of course, and you know, this is important with the cancellation of the seven 47 eight CAD3. This Triple seven X occupies a unique space in long haul, high pay load capacity, wide body aircraft market likely continue to do that for a long, long time wise. That is nobody's planning, anything you compete against. It could be at a significant program for Park.
And then lastly, you always talk about the legendary, but with some 47, thank goodness for spares, that's going to slide 32. So we have a GE aviation jet engine program, sales history and forecast estimate home. So on the stage to sales history and all body look at on the right-hand column, Q1 $6.2 million, Q2, $3.1 million, Q3, $4.1 million. So Q2 and Q3 were those burned down quarters. Q4 we got booked $7.5 million. So much for the burn-down, I would say $7.5 million go look through the quarters is any $7.5 million quarters. I don't think there were a couple of years before the pandemic and know that we're at that level maybe two quarters. But if you go back a little further history,
So goodbye. Amrest inventory burn down. I would say that's relatively good news for Park and then we predicted this, but we'll get to that in a minute. I guess, slide 31. It starts the sharp drop off in Q2 and three GE aviation jet engine program sales as a calendar year 23 build plan. And that's our build plan on ours translated into about $23 million of par TAVI program sales because this last time. So what happened in a way where our sales less than that in our Q3 -- Q3 and Q2.
Well, what I told you that answer that's and highlight that the bottom, the burn-down explains all thing.+ Let's go on to Slide 32. So this kind of disruptive inventory burn down happen again, I think it'll likely will attend before have left. And again, there may be some like will be some degree of quarter-to-quarter volatility in energy program sales because of inventory management challenges may be somewhat of a roller coaster ride from time to time. So we talked about this at some length in Q2, just talked about the aerospace industry, Jeff general, how it has this per 10 propensity to have Tory management challenges. You know, and we can't do anything about that. You know, we decided to be a supplier to that industry. We have to work with it. We can complain about all we want like total waste of time. We're happy to ride the quarter quarter key program sales, rollercoaster and face the challenges presented by it because to us over a lot riding reporting federations, long-term ou
tlook for the protein program sales, as explained on slide on Slide 38. But the rollercoaster ride does this volatility does placed additional pressure on us at Park to be agile, nimble and fast on our feet with our supply chain and inventory and production management activities, you know, we've got to be able to respond quickly, and that's kind of our callin
g card at Park that. So we'd like to do Slide 33. In total, we're still in the burn dot sorry, it's such a big deal and we did not spend a lot of time on it. But where we don't want to burn down well in our Q2 presentation, we could get to the burn now will likely be completed in Q3 as that the park inventory carried by AmerUs, we normalized by and into Q3 based upon our bookings for Q4. And that prediction was obviously correct. So we guessed right in that one one. One more consideration regarding inventory management, as a general matter is very important to avoid over correcting an overshooting doing so create additional volatility with increasing sine wave ample to have in inventory swings. In our Q2 presentation, we indicated this was a concern of ours, and if our concern proved to be well founded, it could result in significant spike in demand in Q4 and into Q2 to fiscal 25. We tell you that in our Q2 call on top of.
let's go to sorry for that based upon our GE Aviation program bookings for Q4, that concern was obviously well-founded our decision to ramp up our costs in Q three in order to prepare for Q4 spike in demand. Obviously the right decision for Park.+ No funny, I remember a few months ago, Mark said to me that he had nervousness. What do you mean? He said, Well, you know, we tried to track the inventory and it seemed like inventories were down. A lot of these programs are ramping and he said, boy, you know, he should Cerner is going to be the spike and we could get we can get overruns and he was right. And obviously, we decide not to get overrun by increasing staffing up and building our of our costs in Q2 three.
So we'll be ready for Q4. So what it was a little-known kind of U.S. mortality, but we think it's mostly just noise a static. We think the freight train a juggernaut has come down tracks at us on our miles per hour. It can't be stocked. So let's talk about on Slide 38. We better be ready or we will be overrun. Just like Mark was saying to me.
Slide 35 FLAD. 24 MRS. build plan theirs, not ours translates into $28 million of 24 party aviation jet engine program sales after that build plan as you roll. So I think that probably update that build plants soon. Let's see what happens. Maybe it will be higher. Right. Don't know.
Let's go on to Slide 36. So now let's talk about Park as a whole. We have these three just for them for perspective and you could see a Q. one Q. two Q. three, and you see a weak Q2 and Q3 were because the burn-down and other factors we described at the beginning of the presentation. But I was looking for Q4 well by $15 million to $16 million, remember $7.5 million for GE Aviation programs, so that would be about $7.5 million to $8.5 million for non-TV aviation targeted sales and EBITDA $3.2 million to $4 million. That's just doing the math, really.
A lot of variability and EBITDA based upon which programs are active, that kind of thing and the timing of when additional costs at Ligand. But that's our best guess we can give you know, we talk about total for the year, and that's just kind of adding up the first three quarters plus the forecast for Q4. So nothing but just doing the math there.
Looking at the two sorry, 24 total compared to 23 total toplines about like 23 and the bottom line and forecast about like 23. So 24, we're kind of stuck in a mode as compared to 23. But looking for that breakout of what we're talking about going forward.
Slide 37 following is our updated, okay, we won't spend time with a preamble. You preliminaries here because we went through this for last two quarters. This is our outlook, very important stuff, very critical stuff for both GE Aviation programs apart generally. So we think that the outlook is actually more important and meaningful than the quarterly forecast we gave you, you know, we did give you quarterly forecast. What's the timing for the outlook? People is yes, that we don't know. We said the freight trains coming can be stopped. That would be ready. I mean, Airbus, he always says they're going to be at 20 section in 2026. So I don't know. I mean what I'm what I'm not in position to second guess him, Why would I do that?
Let's go on to Slide 38. So here it's a juggernaut dis-synergy aviation jet engine program drove an outlook. I'm not going to go through it because we went through it now. There's hardly any meaningful is no meaningful change is a little kind of fine tuning that from Q2. The main thing we cover in Q2, I think went through this each program in detail during our Q2 call. So if you want, you can go back and listen to that.
But the main thing we're trying to convey is that this is these forecasts on aggressive or conservative. We went through each item each program, the revenue per unit. We know that information. We have debt from our customer. So I think the only question is what do we assume in terms of end units? And we went through the explanation of that in Q2. And like I said, we think they're pretty conservative ends up at $55 million based upon the assumptions that are listed below which we will not over. But you can read them take any questions about them.
Let us know, slide 39 diversity, Alec, for all partners such as GE Aviation starts running loans, but we're almost there. And this is identical to the slide that we provide to you in Q2. Just really important, I would not change and on the math, as I'll explain in the footnotes, if you have any questions, if I could just let us know what we're saying. The outlook is $115 million sales and $36 million or $37 million EBITDA. But this is an outlook. As we said, it's not a forecast piece does not include anything other than the programs that were sole-sourced qualified on and assumption of a small increase in our non-GAAP nation sales baseline, which is $32 million, and additional $23 million.
So we resumed our goal to $40 million over the wildlife. Gary, what should we think is actually kind of a walk in a park and hope that doesn't sound arrogant, but that's how we look at it. So let's go on to slide total. Yes, Slide 40 is just a footnote forwards in explaining the math that we did it pretty straightforward. Slide 41. So these are examples of programs are not take into account in the outlook exit, not a forecast and outlook. Some of these programs will hit some probably won't, but some will I think we just can't tell you which ones, but I don't want to highlight we're not going to go through a mall biggest to really the same as we covered in our Q2 presentation, except there's a new one major new manufacturer project assessing the following slides.+ So let's go to this. one is actually a big deal. You know that just recently came up major new manufacturing project initiatives are part of question by highly motivated, long term large customer, and we believe provides us because a high degree of likelihood to proceed. Why is that? Because there's a motivated customer that wants it to proceed. It's extremely confidential. So I wanted to tell you about it. We wanted to tell you that these it's a big deal, but we can't tell you anything about it easing of any details. But just to give your perspective, in order to do this, we need to build a new or purchase a new factory for the project size 30,000 to 50,000, probably closer to 50,000 square feet. Capital estimated $6 million to $10 million estimate for the large workforce. That's the hardest part for us. You know, I won't give you the number, but it's a lot of people now we're looking seriously at automation to reduce the size of the workforce, but that would increase the capital spending automation.
Slide 43, preliminary estimate of revenues for the project $20 million to $30 million per year range. This is not we're not talk and speculation. I wish I could tell you more, but I can't we're not talking speculation about the revenue opportunity, lots and lots and lots of detail behind that. And it's probably more than 10 years CryoLife program, you know, again, whatever 20 years. 25 years. So it's a big thing for Park, Tom high-priority, potential, high priority, potentially very important project for Park in our customer. That's going to slide 44, a little bit of a change of pace here. We haven't talked about the up do James Webb Space Telescope while revelations for the ages reminder your 21 of parts proprietary Cygnus drives our corporate didn't see Jamie Webb structure. James Webb, along with our second strikes, are established at the La Grange to Orbit Point located about One Million Miles from Earth free faraway. I don't know I looked it up, but I think light travels at 186,000 miles per second. Maybe you can look that up. I think that's it. But if you do the math, that's about five, second five light. Second is the way your light years about five seconds away another, which would take about five seconds for the electric ROE, magnetic signals and stuff like that. Radio signal to come back from James Webb to your the James Webb recently spud and this is just amazing stuff I, you know, title ever seen an agent Blackhawk, the maths of 1.6 million suns from 13 billion years ago. The James Webb. But at this black hole in the center of the infant gallons, CG., I'll just start with the acute taking these items are some very clever that's not to be Gen Z. David is calculated Galaxy JGNZ. 11. That's only 440 million years after birth universe. But your something and bowl a big, big, big black hole, this magnitude not supposed to have existed until much later the development universe. So what's that about universe? Really 13.7 billion years all or is a much older net 13.7 on those scientists?
I don't know anything about this stuff, but I think scientist measure the age of the universe by expansion and extrapolating back in on how many years to talk to get started. But that's gone the next one. Slide 45, our theories about Star and Galaxy formation, correct, are fundamentally flawed. Our modern cause a logical theories about the universe and its origins. Correct, are fundamentally flawed and there's nothing more important than this or universe. How to Get Started data and images are in no facts are facts from the James Webb are turning modern cause of a logical science upside-down inside out. We thought we understood so much about universe and its origins, but the James Webb is telling us we know so very little. Our theories are just not holding up. It is just beyond words, description what it means for us at Park to be a very small part of the James Webb, and it's revelations for the ages.+ Let's go on to the last slide, just quickly disease little photos from our park family holiday party celebration thing I wanted to tell you about is this is actually kind of like a meaningful something just our factory fill the factory floor. But we didn't have all these tables here for explicit stuff. We go through their cede the floor to the original factories to 15 years. All that done new factory suggest for we don't leave the floor up for parties. Most beautiful factory I've ever been in very special solve every time you want to take a look, just let us know we have to show you around.+ Okay, that covers our presentation, operator. So there are any questions to be happy to take them.

Question and Answer Session

Operator

Thank you. (Operator Instructions) Nick Ripostella, NR Management.

Good evening wall and helping buying and all the volatile nature of I know you can't get into specifics on this solid potential on new program, but might you be able just saying something about a month behind it in terms of Ball, all the kind of radar we can call follow that something like Bartlett harmful now. Can we just assume it would be somewhat a lot of existing profile and on why do the best we can all look, when we say we'll talk about the Company and use the word conservative. I trust you can take that to the bank. So you could be conservative. As you know, obviously Park has a very bright future on annualized, you said in the past few pages. So concerning how much cash do you think the Company wants to keep on the balance sheet? I'm now going forward, what do you think, Paul, what's your viewpoint on that?

So that's a tougher one. The first one on the margins are quite good on this new project, quite good and maybe better than our existing margins. You know, certainly not worse, maybe better than our existing margin. So quite good. And by the way, happy Happy New Year on. Thank you for your questions.+ So I hopefully that gives you a little perspective. We there's a lot of information is not just kind of like starting. We have lots of information, a lot of numbers that have been Christ. So we know a lot about this project. So when I say the margins look quite good, that's not just kind of locked up plants stuff, how much cash we want to keep. Well, that's why I mentioned we got to $9.3 million box that we still going to pay the IRS for that, that freight rates and stuff. Well, I don't know. I mean the good question. It's something we think about the Board talks a little time on the it's really nice to have cash that we wanted to this project. We say $6 million to $10 million. But let's say we spend more money and automation, let's say it's more than that. You know, it's nice that it's nice to be able to say, yes, we'll do at Kraton. Okay. Where do we get the money for, you know? And on the customer that we've had a delta process, they know that to a public company. So they know that we both agree to do with that. We're not going to come back on sale. Sorry, we don't have the money at all. So I don't know if that's a good question, Nick. I mean, I'm not at all really going to say, oh, we got waiting which get more cash than we'd like to have when we had $150 million or so. I always said that, but at this point on, yes, I mean, it's really nice to have the cash we have. But I wouldn't say, oh, my God, we have so much excess cash. I don't know if that helps, but that's kind of one-off top my head off-the-cuff answer. It is something we talked about at the Board level quite a bit of a logical point.

Obviously, Tom, with what's going on more not going to start generating cash now, Paul, from the last couple of years. So I'm going to even often called the taxes and things like Bob, on the mix just bought. Yes. And I haven't I think it was nice to me like you run the company, very conservative like Bob Paul now with programs like this all up, I guess trying to fill it out a little bit. But I understand when it comes from.
Good point. You could quantify a static number, we you're right, we expect to generate cash. So it's something that really we have to evaluate on an ongoing basis. Nick, I think it's just it's nice to have I have something so that when opportunities present themselves can go after them, though, we never thought I'd take a buying stock buy back stock is our biggest priority. But we'll do that as well, if to know if the prices right in the opportunity presents itself. So I should like to have cash available for that as well. And in IDEX's companies, they think will borrow money to buy back stock because like, okay, that's interesting way of doing business, but it's on our way of doing business so that we find to be around a long time. We're not planning for a couple of years and playing games with our we call financial engineering stuff, but still okay. Is that help or any other questions?
Thank you so much on lettings. Best of luck for the rest of the low end next year.

Thank you very much and Happy New Year to and your family upfront banks.

Operator

Think there are no further questions at this time. I would like to turn the floor back over to Mr. Brian Shore for closing comments.

Thank you, operator, and thank you, everybody, for listening in who is a really nice to be able to share what's going on Park with you all again and wish you and your families a happy new year that comes from both net and me and Martina, Dan, on all of us and will be around if you have any questions, feel free to give us some call have to talk to you. So you have a good day and we'll talk to you. So goodbye. This concludes today's teleconference. You may disconnect your lines at this time.