RE:What is wrong with the margin ?Temp, the rise in costs for parts is indicative of what's happening world wide, Parts inflation, hasn't come down Labor isn't either. Especially in industries that are going strong like BJ's. There is a learning curve as well for the newer designs. But I'm confident that they'll be able to reach the 18% next year. It'll happen partially because of the OE reduction for next year. Remember we'll have no higher than $300M in CAPEX costs.
The +FCF is where the picture will get brighter, given that we are going to get rid of all these expenses including the lower Interest costs. The Revs in Service are increasing too, so that could increase the percentage in the margins (prices going up).
Keeping our eyes on things. Tempo1 wrote: The target for 2025 (all year) is a 18% margin for adjusted EBITDA.
We are at 15,5% for the two first quarters, down slightly Y/Y from 15,6%.
There is a long road to be at 18%.
Management could have explanations and confidence but it is clearly challenging. Balance that with the Spirit file : What will be the additional supply costs for the parts from Spirit ? Don't expect that all will be the same as before for that supplier.
Markets are pitiless, These stellar results had some parts of shadow. Market focus on them.