Question-and-Answer Session
Operator
(Operator instructions) And our first question comes from Ned Borland from Next Generation. Please go ahead with your question.
Ned Borland – Next Generation
Hi. Good morning, guys.
John Sztykiel
Good morning.
Ned Borland – Next Generation
Just looking at the backlog in other specialty, it's held pretty dramatically. I know that the spare parts and accessories are in there now. Now you said the install base of vehicles out there is 65,000. How is the install base going to trend going forward? Have you shipped already enough spare parts fits in order to – I mean to sustain this level of revenue that you've been seeing recently?
John Sztykiel
Well, first, Ned – and this is John Sztykiel, from the service, parts, and assemblies perspective, what's driven the business for the most, over the last 6 to 12 months, is obviously been the defense. And there are still tremendous opportunities out there to both grow – to both develop and grow that part of the business.
The interesting thing is about the turn cycle on service, parts, and assemblies is it has a very, very short turn cycle, in that when people want the parts, they place the orders. And part of our demonstrated excellence is that we turn the orders very, very quickly. So we see tremendous opportunities for us to grow the business.
On the other hand, though, the reality is that there are a fair amount of our vehicles, which are in Iraq. And the situation in Iraq today is not as violent as what it was 12 months ago at this time. So per a per use perspective, there is the potential for less service, parts, and assemblies relative to those vehicles overseas, in particular Iraq. However, there's also the opportunity for refurbishment. As the military take the vehicles out of service or reduces their service, they typically look to upgrade, refurbish, et cetera. So we're now starting to see those opportunities come to bid in the marketplace, so.
As we look at service, parts, and assemblies, we see still see it as one of our key business segments. Will we have the same demonstrated percentage growth over the six to nine months, which we've had over the six to nine months? Honestly, it's a bit too early for me to tell today. But the backlog is down in that particular area. And I think part of it is just the fact that the vehicles are not being used as much in a violent situation as what they were 12 months ago.
- To read the full transcript on Seeking Alpha, click here »





