FTAI Aviation Ltd. (FTAI) Earnings Call Transcript & Summary

Okay. Well, as I told my old friend, Joe here, he's #19 in terms of aviation-related webcast that we've done. Let's see, 17 of them -- well, this is #17 in terms of company presentations. And then we had the aircraft values panel yesterday, and Adam Polaski's talked yesterday. So hopefully, everyone has access to all of that. But we saved one of the -- I don't want to say quirky, that's not the right story for you, but unique...

I would not use that word.

Yes. I will call you unique because it's a very big market that you're part of...

It would call it differentiated.

Yes, differentiated. That's -- Alan will like that better. So we'll call that differentiated in terms of -- very pleased to have with us Joe Adams, who is the Chairman and CEO of FTAI, Fortress Transportation and Infrastructure Advisers (sic) [Investors]. We've known FTAI for years now in their current iteration, but Jamie and I know Joe going all the way back to his days at Aircastle and Fortress -- really at Fortress when he founded -- one of the founders of Aircastle and started that business and so forth. So we go way back with Joe. Joe has a long tenure in aviation, of course, and FTAI is the latest sort of iteration of that, and obviously, has a big presence in engine leasing, which was a topic earlier today that we talked about with AerCap, and we'll get into that, but also has a couple of unique infrastructure assets as well, sort of a dual-track platform, which Joe is going to walk through some slides. Jamie and I will go on video mute, and then we will pop back in, Joe, when you're done, and we'll have a little back and forth to close out the day. So over to you.

All right. Thanks, Mark and Jamie. Again, thanks for inviting us to be here this year. And we look forward to getting together in person next year, which will be a relief and fun for everyone. As Mark mentioned on Page 2 of our slide deck, and I'll reference the pages as we go along, we are -- FTAI is engaged in 2 businesses, and it really goes back to our history and our private equity period at Fortress when we started Aircastle. I was the first employee, started in 2004, and we built up a very successful aircraft leasing. Business took a -- like and had a good experience in space, but realized we wanted to do something more differentiated. So that's why we have the current incarnation, and I'll talk about that more. And then secondly, we owned RailAmerica and Florida East Coast, 2 major railroad properties in North America, in which you probably remember RailAmerica and Florida East Coast, both being public companies. And that works out very well for us. We like the rail business and we particularly like the part of the business where rail and water come together. So our infrastructure business consists today of 3 North American port and rail terminals, which we think all have exciting future. So together, on a combined basis, we think it's a very interesting investment proposition that -- we have a lot of contracted cash flow from our aviation business and a lot of investment opportunities. And then second, we have very strong growth opportunities in infrastructure, both growth in EBITDA and growth in value creation. So together, the 2 complement each other and create a very nice diversified business in transportation and infrastructure. That's the name. If you look over on the next page, on Page 3, when we started Aircastle in the engine business. As I mentioned, we were looking for something where we could build up a sustainable competitive advantage and a differentiated business. And the engine is a lot more technically complex, and you have to make a lot of decisions because every 5 to 6 years, an engine has to go through a major overhaul, which is -- it was a very big capital investment and a lot of decisions to make. And so when you think about our business model, even though it says aircraft and engines, 90% of the value of our portfolio is on the wing or in the engine. And engines, I think, have a better investment profile and that every 5 to 6 years, you're putting a lot of new parts or -- and you're doing maintenance on that engine. And every year, the original equipment manufacturers raise the prices on those parts 6% to 7% a year. So a properly maintained engine over time actually goes up in value. Which if you contrast that to an aircraft which tends to go down in value, we think engines are a lot better investment proposition. In addition, we collect maintenance reserves and advance on all of our engines, so we get paid for every hour in cycle it's loan before you have to do the maintenance event, which -- so in addition to sort of having a great cash collateralized security deposit, we actually make money on engine maintenance reserves. So the core competency is engine leasing, and we've built a business that I think is as a -- what is truly unique in the leasing market, and that is -- has a sustainable competitive advantage. And we've built a series of products and deliverables and exclusive to us that no one can copy. And that was -- one of my frustrations at Aircastle was, I realized after taking it public that, frankly, most leasing companies don't do much of anything different from one another. And so we've built a business where we can both -- today, they have a sustainable advantage on the shop visit costs and maintain that over time to build a higher return on capital and ultimately, move us towards more of a service-oriented business model as opposed to just trying to go out and capture the highest lease rate. If you look over on Page 4, this is one of my favorite slides and that this was a revelation to us after we started the business and we were leasing 757 and 767 engines. We realized that the largest engine market in the world was maturing and coming down the pipe to where we could access that opportunity to manage those shop visits, and that is the CFM56-5B/7B engine. So this is the largest engine market in the world, probably ever. It's 100% of all 737NGs, 5 -- 7B and 60% of all A320 CO aircraft used the 5B. And so if you look at the chart on the left, which is the blue line, after engines have been out in the market for, say, 10 years, typically the original equipment manufacturers guaranteed maintenance programs expire, and then the airline operator or leasing company is responsible for maintaining those engines in the aftermarket. And that's where we come in with our products to be able to manage those shops visits at a lower cost. And you can see just on the math of what's flying around the world today, those 22,000 engines, the number that are served in the aftermarket is effectively almost going to double over the next 10 years just by the aging of that fleet. So a big growth opportunity for aftermarket shop visits. The second part of this is the interesting part that the -- as I mentioned, a lot of the shop visit cost is in replacing parts, and those parts tend to escalate 6% to 7% in a year because the OEM business model is essentially to sell that engine upfront for very little profit, but charge more and more every year for engine parts. So you look over in the writing today, a shop visit cost would be about $5.5 million, 2022 is $6.2 million, and in 2028, you're looking at $9 million. So that's the investment that you have to make every time that major overhaul is due. So turning to the next page, when we started thinking about this, there's 3 components of that shop visit that we could attack. One is on the parts itself. And airfoils can be manufactured under a program, the FA approved program called PMA. If you're familiar with a company called HEICO, they're a big player in non-hot section parts for aircraft and engines. Chromalloy is the leader in hot section PMA parts, and they manufacture PMA parts for the CF6-80 engine, Pratt-4000 engine, the CFM56-3C1, so we have a long history in this market. We partnered with Chromalloy 4 years ago to begin designing, manufacturing and ultimately, getting approval on 5 parts for the CFM56 engine, one of which was approved last month by the FAA, the first of which. If you look at the total of those parts that will be produced, 5 of them, that encompasses about 80% of the cost of the airfoil section of a shop visit. So a big section, a very significant amount of the cost of parts contained in 5 different parts in that engine in a shop visit. So we entered into a joint venture where we invested capital, $30 million to pay for the development costs of those parts, and we get 25% profits interest in the sale of those to airlines and other third parties. And we get the ability to buy those parts for our own engines at cost, which is about 1/3 of the price of the OEM list price and represents about a $2 million savings per shop as it just from those -- just on that one part alone. The second part of our approach would be the maintenance side, which is to have a maintenance shop, which is where you do the overhaul as one of our partners, and we entered into an agreement last fall with Lockheed Martin to be using their facility in Montreal. It's an old Air Canada facility. It's a beautiful 300,000 square foot facility. They have a leading capability in CFM engine. It was perfect for us, and it also allowed us to set up what we call a module factory. So every time we bring an engine into that shop, one of our own engines, we immediately separate it into 3 modules, a fan, a core and an LTT. So those -- that gives us the ability to mix and match, also to sell modules to other airlines, optimize and produce an enormous amount of flexibility and additional savings. And we got a very good deal because during COVID, there was -- lot of maintenance shops were relatively empty, so it was a good timing from that point of view. The third part of the business dealing with the CFM engine is the parts business. So sometimes, you're going to look at one of those modules and decide it doesn't make sense to overhaul it. It makes more sense to part it out. And so we did partner with the largest player in the aftermarkets business, which is AAR, and they entered into an exclusive arrangement with us for 7 years. So when we take a module and we part it out, AAR will be selling it through their distribution network, and they are exclusive to us, meaning that they will not compete with us on those products. So we got the best of all 3 worlds. I think it's critical to have all 3 capabilities to really be able to deliver a service to airlines into our own portfolio that literally no one else can match. And so for the largest engine market in the world, huge savings per shop visit and we haven't locked in for, in essence, I think, for perpetuity. So that's why I'm so excited about the engine market. Turning over to infrastructure quickly on Page 6. There's a picture of Jefferson Terminal in Beaumont, Texas. It's on the Neches River, which is deepwater and across the river from our tanks and rail tracks is the Exxon refinery at Beaumont. Today, that's about 360,000 barrels a day of refining capacity, scheduled to go to 620,000 in 2023, which will make it the largest refinery in North America. And one of our other big customers is 10 miles down the River in Port Arthur, which is Motiva, which is owned by Saudi Aramco, which is the largest refiner in North America today. So close proximity, we have 3 Class I railroads that serve the terminal which allows us to bring in crude from Canada, from Utah, to export refined products to Mexico and to offer the refineries the ability to access 3 different railroads, which is truly unique. And then in addition, we have newly constructed pipeline connections to Exxon, where we have 6 pipes running under the water there to connect us to allow us to deliver refined products from the refinery to our terminal for storage and then ultimately ship to Mexico and then ultimately, adding crude and intermediates to the mix so we can grow as they expand that refinery. And then we also have other Canadian producers of Canadian crude that have taken space in the terminal. And producers in Canada are scheduled to be building diluent recovery units in Canada, which means that if you strip the diluent out of the crude, the only way it can get to other markets is by rail. And so that creates a permanent steady supply of a highly valued crude for refineries such as Motiva and Exxon. Turning -- next is 2 other projects which, when we bought them, they were really development projects, which is what we like to do. The Repauno Port was a former DuPont manufacturing site on the Delaware River going back as far as the 1800s, and it has been dormant, but it had, again, great rail access, deepwater and underneath the property, it had a granite storage cavern, which once upon a time was used to store ammonia. So we bought the property, and we've now put it back into service, but this time for natural gas liquids, propane and butane, and we exported our first product to Europe in January across the new dock and using the rail loading system that we completed last year. Ultimately, we can expand the granite caverns, and the advantage of building storage underground is it's about 1/3 the price of building above ground. So it's a huge economic advantage to have the formation that we have. And we see a Phase II expansion opportunity where we can add approximately 2 million barrels of storage and load VLGCs at this property and ultimately, generate $150 million to $200 million of EBITDA off of a property that was basically shut down. And then lastly, we bought another property out of bankruptcy. It was an aluminum smelter, a company called Ormet in Ohio. And aluminum requires lots of electricity, so they had power lines running onto the property, 500 megawatts of power lines. So we decided that it was an ideal place to reverse the flow and actually generate power using abundant natural gas that's in the region. So we locked in a supply of gas, and we sold electricity on a fixed rate basis, so we're not a merchant plant. Now we locked in a spread of $120 million of EBITDA, and we're finishing up the construction of that power plant, which is a GE -- the new state-of-the-art GE turbine, the 7HA.02, which will be completed 2.5 months early in August, which in this environment and COVID environment, finishing a project of this magnitude early is quite a -- feels very good. And that will come online. And we also are very excited to be the first GE turbine worldwide and the first large frame turbine in the United States to begin using hydrogen as a fuel by the end of this year, and that's obviously a big topic for everybody generating carbon-free electricity is huge on everybody's mind, and we can -- we will actually be doing it. So we're not just talking about it. And we have contracts to purchase the hydrogen. We will have the equipment installed by the end of this year. And we'll have a pathway to creating a very efficient power plant with potentially using 0 carbon fuel as a feedstock. And all these -- both of these properties have 200-plus acres above ground that we can develop, and we've got lots of industrial activity that we're looking at adding to each one of these, given the excellent logistics, the rail connectivity, the water and the low cost energy. So very significant growth opportunities for all these properties. Lastly, on Page 8, is just our capital structure approach has been targeting about 50% debt to total cap and trying to maintain a strong BB credit rating to be able to access efficiently the unsecured bond markets and then also the project finance debt markets for each of the infrastructure investments. We're working on a -- as an example of that, we're starting to work on a tax-exempt financing at Jefferson, which is in Beaumont, which I mentioned, where our taxes and bonds are trading in the 2s. So we can use -- we can borrow long-term at under 3% for approximately $250 million to finance expansion at Jefferson. And so we have attractive opportunities across the board for project debt, municipal debt, unsecured debt and preferred equity as well as liquid market in common. And with that, I will kick it back open, I think.

And here we are. Great, Joe. Thanks for running through that. So I guess the elephant in the engine cowling, that's like I describe that, is...

Seems messy.

Yes, exactly. Well, let's not talk about contained engine explosions or anything like that. So wondering -- given what Gus Kelly is doing now with the AerCap acquisition on GCAS, obviously, there are hundreds of engines that GCAS had managed on its own and in partnership that are now or will soon, be part of the combined entity. Gus also has a lot of funding to do and so forth. So I mean, did you place the phone call and say, hey, we're in the CFM56 game too and we'd love to talk to you about opportunities? Is there something for FTAI and AerCap to do in that regard?

Well, we hope there is. I mean, we've done a lot of secondary aircraft purchases from AerCap. So we have a good relationship there. Many times, what we'll do is when an aircraft is sort of reaching -- the airframe is reaching the end of its life, the only real way to monetize -- the best way to monetize that is to scrap the airframe and then use the engines. And so for instance, in today's market, we're buying aircraft that are off-lease, which is sort of a -- that is like if you have 100 aircraft off lease, you don't want to add the 101. So very few buyers for off-lease aircraft, except for us because we can scrap the airframe and use the engines. So very -- extremely attractive acquisition prices that wouldn't be necessarily his motivation, but there are a lot of them around today. But having said that, GE was never a big counterparty to us. And given what we're doing on the engine side on the PMA, we never expected that, that would be. So there has to be -- this has to be better than that. So we think there's some real potential. And as you remember, AerCap was in the engine leasing business with AeroTurbine, sold it to ILFC. They then bought ILFC and got it back and then ultimately, ended up just running that business off. So I have found that it's very hard to run an engine leasing business inside of the large aircraft leasing business just because it's so small. And the people -- the best people in the organization want to work on the big deals. They don't want to work on a $2 million engine which has a lot of headaches and just creates a lot of noise. So I think it's a -- I think there could be an opportunity there, I hope.

On the PMA side, we're not as familiar whether we understand what you're doing and so forth, I've got a question here asking if what the sort of level of acceptance is for PMA parts? And I'm just sort of wondering as you separate or as AerCap comes in and operates that engine resale, it's not great that they have a partnership with Safran for part of it, right, so there is sort of the idea that they want all parts to be OEM parts and so forth, right? So just sort of wondering that dynamic about sort of PMA acceptability and although is there, and whether or not any of that changes because of that deal or anything else going on?

Yes. It's a great question. And I'll take you back to sort of the revelation for us is we owned a lot of CF6-80 engines, which is the engine that flies on the 76 and 74. And we were partnering with Chromalloy, we've actually -- Chromalloy would manage the shop visit, and we buy it back from them, and they were putting their Belac blades, PMA blades into that engine. And so we went to our airline -- I went to our leasing team with 2 questions. I said, hey, does anyone -- does any airline in the world not lease an engine from us because it has a PMA blade in it? And they said, no, of course, not, everybody leases. I said second question is, does anyone get a discount on the lease rate because there's PMA in the engine? And they're like, no, why would they do that? They just want thrust, and it's a great blade. So that actually was -- the revelation is like, well, if that's true, then the big knock on PMA from the OEM has always been, well, you're going to negatively impact the residual value if you put PMA in it, right, so that you don't want to put -- your leasing company don't want to put PMA because you might affect the residual value. And everybody is like, oh, I don't want to do that. But if our way of monetizing that residual value is by leasing it, we never have to sell it. So even if it's true that there is an effect on residual value, which there isn't, by the way, we have a perfect path to monetizing that value. So that's when we said, you know what, it actually doesn't matter. One of the reasons that Chromalloy, I think, wanted to partner with us too, is that the OEMs have been very successful at scaring spooking leasing companies who are putting TMA in, and Chromalloy has been spectacularly unsuccessful at getting other leasing companies in. And so they felt like our presence, if we do it, and we say to other leasing companies, you should try this, it's actually really good because most blades get scrapped out anyway. They're not like saving blades usually after a shop visit, so there really is a lot of -- sorry, misinformation. And I think if we can sort of point out to other leasing companies, then there's upside for both of us. But it is really a very good question, it's one we're going to get into. There's never been an engine market of this size, so I think -- if you talk to the big airlines, they all use PMA, United Delta, Lufthansa, Air France, everybody. They even make -- some of them make their own PMA. So they're not at all put off by it. So that's a big market and a huge opportunity for cost savings for them and which in this environment they want to pursue. And I think it's huge for others, but we're not looking -- we're looking for peaceful coexistence, right? You want to have enough, but not too much. So I think it's going to be great. And we did -- because we started 4 years early, this engine now is just coming into its prime from an aftermarket point of view. So that's why the opportunity is so significant and a little bit different than what it has been in the past.

Yes. Joe, if I gave you $1 or $100 million, the amount isn't necessarily relevant, but how would you allocate that across your various lines of business right now?

Well, we have -- it's a little bit like choosing your children, right? We like all of them. There really -- each one of these projects has some special significance to us. And so -- but the other thing I would say is that when we look at something that we've wanted to do, we've never -- not done it because we couldn't raise the capital. So we don't necessarily think of capital as a finite commodity. And then on the infrastructure side, I think we've been good at recycling capital. We bought the Central Maine & Quebec Railroad out of bankruptcy after the accident they had. We bought it for $14 million. We put like $20 million fixing it up, and then we sold it for $140 million to Canadian Pacific because: a, that was a good price; but b, we sort of exhausted what we thought we could do with it. It's up in Maine, and there's not a lot more -- it's not exactly the most robust economic environment. So we sort of felt like that was maybe the best we're going to do. Then on the Long Ridge Energy, we bought this property. We started on the path of getting in the power business, but did not want to be a merchant plant, so we contracted the offtake and we contracted the supply, but then we had to build the plant. So we're saying, well, now we've got to wait 2 years before anything good happens, why don't we just take our money out? So we sold half the equity, took our capital out of the deal fully financed, and we're able to do other things. And fortunately, we did both of those right before COVID hit. So we actually had a balance sheet that was luckily in a really strong position going into that. It was our lowest leverage and our highest amount of cash in February of 2020. So I think we've been pretty good at like figuring out how to stretch it, how to make it all happen if we want it to happen.

That's helpful. And we've heard from a broad array -- well, airlines yesterday and less source today, and ESG was a topic that was woven through almost all the presentations. Given the variety of your businesses, how does that topic sort of course through Fortress?

Yes. That's a good question. On our last call, we mentioned and the answer is that everybody in the organization is involved in working on solutions. So within aviation, we've got 3 main initiatives. One is sustainable aviation fuels, which is the obvious one and the one that you don't have to redesign the whole airplane. And so we've got several projects working in that, be it nonrecyclable plastics, converting that into sustainable fuels, one which converts wood waste into jet fuel. So we've got initiatives looking at that. And then secondly, we're negotiating to commercialize a product that exists, but hasn't been well sold, and that is an air sterilization and filtration product. So the obvious need is it uses ionization and it uses it in a very low voltage way. So you get high flow of air, and HEPA filter is a very -- you got to push a lot of air very hard through those. So this product actually saves fuel. So create a safer environment and save fuel, that's another one that I think could be phenomenal. The third one is recycling of engine parts. There's nothing more efficient if you're talking about reducing carbon, then not making something, right? So if you can actually not make another blade and use an existing blade or at a second level, if you take that scrap and you recycle it, you melt it down and reuse the alloys, huge savings there. So that's something that we're just thinking about rolling out and including partners and ourselves and maybe airlines because on the jet engine side, recycling is huge there. Then we have -- on the infrastructure side, we have a multitude of various biofuels, bioenergy projects, but we're looking at each one of our infrastructure properties, which I mentioned, have about 200 acres available. It has rail access, it has water access, it has cheap electricity. There's really a way to incubate some of these new businesses as everyone's trying to come up with the next great thing. And so I think we'll do a number of small science experiments at each one of these. The hydrogen is a great example where we're going to be the first power plant in first large frame that's going to use hydrogen, and then we're obviously looking at green hydrogen. So that's going to be the next evolution. And there's a group that has -- we just met with that converts hydrogen and acetylene, and acetylene goes into PVC. So that is a way of capturing the carbon so you can actually have no carbon hydrogen. You can use natural gas, create hydrogen and then trap the carbon into PVC. So there's a lot going on there inside of our company, and we've committed to the sustainability report next year, and I think you'll see us doing quite a bit. I think if you really think about -- if you want your investments to have residual value, which we do, you have to think about it, you have to plan for it.

So one of the things we've talked about over the last couple of days a little bit here is that when the pandemic first happened, I remember sitting in the office in March, telling someone, well, all right, we're going to go home, see you, hopefully, on Memorial Day. And here we are 12 months later, right, and we're still now working from home. Well, maybe not you, but a lot of us are. Jamie and I are certainly still. And clearly, traffic being 8x worse than it ever had been on an annual basis, right, just the duration of the pandemic and so forth, clearly, from everyone's initial expectations, it was so much longer. But if you look at the capital markets recovery, so whether it's the equity market, the debt market, the financing markets, et cetera, that recovery was also so much quicker probably than people would have thought. And whether it's the government support that's out there as well and certainly in the U.S., and we didn't see a U.S. bankruptcy or anything like that, right, but we did, obviously, in other regions of the world. My point is this, were you hoping -- not hoping, but were you looking forward, if you will, to the opportunity for there to be more distressing carnage in the world of airlines in aviation to do more? And I'm sort of wondering, is there enough sort of pain in the system for you to do what you want to do, for you to get the amount of sort of aircraft that you can go straight to part out and get the engines cheap and sort of create feedstock cheaply enough for you? Is there enough stress in the system to fund your pipeline?

Yes. Well, I mean, yes, there's enough stress. I don't want any more. This is plenty. And I would say 3 different parts to that. One is just acquiring things, so we're buying -- an example of that is we're buying 8 A320s that are off-lease. So we're probably the only bidder for those. They're older airplanes, $6 million a copy. So you scrap the airframe and you've acquired a CFM56 engine, a good engine for $2.5 million, that would have been $4.5 million in 2019. And I'm guessing that will be $4.5 million in 2022. So there's good supply of that, I don't see that drying up immediately because there's still -- it's hard to lease new airfreights. So there's plenty of feedstock. The second thing that it did is, these airlines are now so stressed. And we've seen it in the big airlines, they've said, we're going to lease more engines. We're not going to spend capital on shop visits. We're going to outsource more things. We need help. And the client base that we probably would have been able to access, ultimately, we would have gotten there, but I think COVID has allowed us to get -- accelerate our business plan development faster because the need is so great. And they're not coming out of the woods immediately, there's still -- there's been a lot of needs and a lot of concern about capital that they're going to have to deal with. So I think that that's -- I'm fine if like this ends and the people start flying and it's all back to normal again. I think we've had plenty of distress, and I'd much rather see it sort of pick up. The other thing is, as I mentioned, we were looking for an MRO partner for 2 years. And as you know, maintenance shops were really full in 2019, and we couldn't find a facility or a partner that we really liked. And then COVID happened, and then we got a deal with Lockheed Martin. So I feel sort of lucky or good about what we're able to do, but I wouldn't want it to keep going on.

Jamie, I think you have one?

I didn't just get one from the audience. Gets back to the PMA question. So apparently, HEICO, in their presentation, they continued that entering into the PMA or MRO market is similar to starting with bank, really hard and lots of barriers to entry. How quickly can you ramp the selection of PMA parts that you'll offer? And why do you think that HEICO doesn't participate in that part of the market? Is it just residual value? Or are there other reasons?

So we've talked to HEICO about that. And they don't -- first of all, to make the hot section components of an engine requires a very unique capability, which if you look around the world, there's only a handful of companies that can do it, and all but one of those companies are affiliated with the OEMs. They make products that go to Rolls-Royce, Pratt, GE, and so you're not going to go then set up a division to create a competing product. And it's been tried, Pratt tried years ago, and they were going to make PMA on GE engines and they've declared war on each other, and then they declared truce. So they're really -- I've asked people for the last 5 years find me another company that could make these parts that's not affiliated with an OEM other than Chromalloy. And so far, no one is giving me an answer. So there's only one company, and you have to have the machining, the metallurgy, the castings and the coatings, which are very, very high tech. Remember, this is a 1,500-degree Celsius section of the engine, which is higher than the melting point of the alloys. So -- and the second thing that HEICO will say is they make mostly noncritical parts. They make sometimes 1,000 of them a year, and their turnaround time to make those is under a year. So this is the opposite of that. These are critical components. They're high ticket, high value and the development on this first part took 4 years -- 3.5 years. So that's the reason. It's not that they love PMA, and we've gone in to pitch airlines, and we've taken their products and said, you can combine them with our products because they make products for the engine and put it all together because if you're going to put PMA, why not do it everywhere? So they're not against it. It's just a different -- it's a very complicated business, and we got the only partner in the world that can do it, and it's exclusive to us.

That's helpful. Thank you.

Yes, we've got one minute left. So I think we'll let everyone off the hook one minute early.

All right.

We appreciate you for having to speak up for us. What's that, Jamie?

Standing between the audience and their home bars. Get used to it.

They could be doing that already. I've got the bottle of Tito's right over my shoulder ready to go. But Joe and Alan, thank you very much for joining us. Back-to-back high-yield conference and now this industrials conference, so we appreciate your participation in both. Glad we got -- to get your story out to hopefully some new equity investors and some new and existing credit investors. So thank you very much for your time, and stay safe. We appreciate it.

Thank you very much.

Thank you.

See you guys in person soon.