Good day, ladies and gentlemen, and welcome to the CAE third quarter conference call. Please be advised that this call is being recorded. I would now like to turn the meeting over to Mr. Andrew Arnovitz. You may now proceed, Mr. Arnovitz.
Good afternoon, everyone. Thank you for joining us today. Before we begin, I'd like to remind you that today's remarks, including management's outlook for fiscal year 2018 and answers to questions, contain forward-looking statements. These forward-looking statements represent our expectations as of today, February the 9th, 2018. Accordingly are subject to change. Such statements are based on assumptions that may not materialize and are subject to risks and uncertainties. Actual results may differ materially. Listeners are cautioned not to place undue reliance on these forward-looking statements. A description of the risks, factors, and assumptions that may affect future results is contained in CAE's annual MD&A, available on our corporate website, and in our filings with the Canadian Securities Administrators on SEDAR and the U.S. Securities and Exchange Commission, EDGAR site.
On the call with me this afternoon are Marc Parent, CAE's President and Chief Executive Officer, and Sonya Branco, our Chief Financial Officer. After remarks from Marc and Sonya, we will take questions from financial analysts and institutional investors. Following the conclusion of that Q&A period, we will open the line to questions from members of the media. Let me now turn the call over to Marc.
Thank you, Andrew. Good afternoon to everyone joining us on the call. I'll first provide an overview of the quarter. Then Sonya will review the detailed financials. I'll come back at the end to talk about our outlook. We had year-over-year growth in all of our segments in the third quarter. We remained on track to deliver on our growth outlook for the year as a whole. Some highlights included our order intake of CAD 1.2 billion, which is testament to the good progress we've been making to expand our position with airlines, business aircraft operators, and defense forces worldwide. We also generated strong free cash flow in the quarter and maintained our solid financial footing. Looking specifically at civil, we booked CAD 1 billion in new orders for our comprehensive training solutions, which marks a quarterly record for the civil business unit.
Orders included exclusive long-term training services contracts for AirAsia, Air Transat, Mesa Airlines, and Jazz Aviation. We also won 26 full flight simulator orders from airlines including Ryanair, Air France, ATR, Lufthansa Flight Training, and Air Canada, some of which involve multi-year deliveries. This brings our year-to-date tally to 45 civil full flight simulator orders, so we're on track for another pretty good year. Revenue and operating income were higher than last year's third quarter, and for the year to date, civil growth is on track with our outlook. In defense, momentum increased in the quarter with revenue and operating income growth in the high single-digit %. In terms of order activity, we continued to capture important training systems and service contracts, which puts us at CAD 966 million of defense orders for the first nine months of the fiscal year.
New awards in the quarter included flight simulators and training systems upgrades for the U.S. Navy's MH-60R helicopter, as well as the German Navy's P-3C and Sea Lynx flight trainers. Service awards included an enterprise-wide training systems maintenance contract for the Australian Defence Department. In healthcare, we developed LucinaAR, the world's first augmented reality childbirth simulator, which we've just launched in January at the International Meeting on Simulation in Healthcare in Los Angeles. This new high-fidelity patient simulator incorporates mother-baby physiology and is the latest product to integrate the Microsoft HoloLens. Also of note, Healthcare announced a partnership this January with a leading scientific society, the American Heart Association, to deliver AHA certification courses in certain markets. With that, I'll now turn the call over to Sonya, who will provide a detailed look at our financial performance.
I'll return at the end of the call to comment on our outlook. Sonya?
Thank you, Marc, and good afternoon, everyone. Consolidated revenue for the third quarter was CAD 704 million, and quarterly net income was CAD 117.9 million, or CAD 0.44 per share. This includes approximately CAD 0.13 per share attributable to the U.S. tax reform. Net income also includes a net gain of approximately CAD 0.03 per share on the fair valuation of CAE's prior investment position in the Asian Aviation Centre of Excellence. This net gain was triggered by our acquisition of the remaining share of the investment and some reorganizational activities. Excluding these elements, earnings per share would have been CAD 0.28, which is up from CAD 0.26 per share last year, before specific items. Income tax recovery this quarter was CAD 24 million, representing a negative effective tax rate of 25%, which compares to an effective tax rate of 14% for the third quarter last year.
Excluding the effect of the U.S. tax reform and the tax impact related to the net ACE gain, the effective tax rate in the third quarter would have been 17%. Remaining on the subject of tax, we conducted a thorough assessment of the actual and expected future impact of the U.S. tax reform, the good news is that it represents a net positive for CAE. A significant portion of CAE's business is conducted in the U.S., where approximately a third of our revenue is generated and a similar proportion of our total workforce resides. The most significant element of the reform is the lower federal corporate income tax rate, which decreased from 35% to 21%, effective January 1st.
There are a number of puts and takes with respect to other elements of the tax reform, in aggregate, these reforms will effectively lower CAE's income tax rate from an annual average of 22% to something more in the range of 20%-21% as a rule of thumb. Free cash flow from continuing operating activities was CAD 146 million for the quarter, compared to CAD 124.7 million in the third quarter last year. The increase in free cash flow year-over-year results mainly from a lower investment in non-cash working capital. As is usually the case for CAE, we continue to expect a partial reversal for the first half investment in non-cash working capital in the second half of the year. Uses of cash in Q3 included funding capital expenditures for CAD 43 million and investing CAD 99.7 million to acquire the remaining 50% equity interest in ACE.
We also invested CAD 7.7 million to acquire a 45% interest in Pelesys, forming a joint venture with this leading aviation training courseware developer. In terms of shareholder returns, we distributed CAD 23.2 million in cash dividends, we used another CAD 21.8 million to buy back stock under the NCIB program. Of note today, CAE's Board of Directors approved the renewal of the NCIB under similar terms for another year. Our financial position continued to be strong with net debt of CAD 712 million at the end of the quarter for a net debt to total capital ratio of 24.6%. Also, return on capital employed increased to 11.7% this quarter, excluding the impact from the U.S. tax reform, compared to 11.2% last quarter. Looking at our segmented performance. In Civil, third quarter revenue was up modestly year-over-year at CAD 413.7 million.
We had continued good momentum in training growth and a high level of simulator deliveries as well. Civil simulator deliveries were even higher in the third quarter of last year because we were also delivering from the additional simulator backlog that we acquired from Lockheed Martin. In terms of segment operating income, we generated CAD 78.6 million, which includes a CAD 4 million gain on the fair valuation of ACE, net of some one-time costs. Before the net gain, segment operating income was up 4% for a margin of 18%. On the order front, the Civil book-to-sales ratio for the quarter was 2.43 times, the trailing 12-month period, it was 1.43 times. Civil's backlog at the end of the quarter was CAD 3.8 billion.
In Defense, third quarter revenue was up 8% over Q3 last year to CAD 262.8 million, operating income was up 9% to CAD 32.7 million for an operating margin of 12.4%. The Defense book-to-sales ratio was 0.71 times for the quarter and 1.22 times for the nine months year-to-date. The Defense backlog at the end of the quarter was CAD 3.5 billion. Finally, in Healthcare, third quarter revenue was CAD 27.9 million, compared to CAD 26.2 million in Q3 last year. Healthcare segment operating income was CAD 1.5 million in the quarter, compared to nil in the same quarter last year. With that, I will ask Marc to discuss the way forward.
Thanks, Sonya. As I mentioned at the outset, we're on track to deliver on our growth outlook for the year, I feel very good about our long-term view as well. As is customary for CAE, we'll provide more on our outlook for the next fiscal year when we report our upcoming fourth quarter. The civil aviation training market is large and is growing, we've got considerable headroom to expand our position. CAE offers the most comprehensive training solutions across the broadest global network, we're widely recognized for our know-how in cadet to captain training. With more than 70 years of industry firsts, we're also seen as a thought leader in aviation training. This past week at the Singapore Airshow, we launched our latest innovation, the CAE Rise Training System. This is the first commercial offering of our next-generation training system.
By leveraging the latest digital technology, we're able to use real-time data for instructors to objectively assess pilot competencies gain deep analytical insights into training. We're in good position, we have ample opportunity to continue making accretive, market-led growth investments in our training core that align with our corporate goal of 13% return on capital. For the fiscal year, we still expect to generate low double-digit percentage segment operating income growth and to maintain our leadership position again in the civil business. In Defense, we're also encouraged by a large pipeline of opportunities in an environment of increasing defense spending a greater tendency to outsource training. Our innovative solutions involving integrated live, virtual, and constructive training are opening up a large addressable market. Here, too, we have plenty of headroom to grow our position.
For the year, we maintain our outlook for mid to high single-digit growth on both top and bottom lines. Finally, in Healthcare, we're demonstrating that CAE is the clear innovation leader with a steady cadence of new product releases with which to tap into some of the largest value pools, like nursing. We're still expecting a return to growth this year to be positioned for double-digit growth beyond. With that, I thank you for your attention, we're now ready to answer your questions.
Thank you, Marc. Operator, we'd now be pleased to take questions from analysts and institutional investors.
Thank you. Ladies and gentlemen, if you would like to register a question, please press the one followed by the four on your telephone keypad. You will hear a three-tone prompt to acknowledge your request. If your question has been answered and you would like to withdraw your registration, please press the one followed by the three. If you're using a speakerphone, please lift your handset before entering your request. Again, ladies and gentlemen, if you'd like to register a question, one, four on your telephone keypad. Our first question comes from the line of Fadi Chamoun with BMO Capital Markets. Please proceed with your question.
Thank you. Quick question on civil. In the quarter, you had revenue up 3% and you had EBIT up 4%. If I take the guidance of low double-digit for the full year, would imply again, mid-single-digit growth in the fourth quarter, which is quite a bit of a deceleration in the operating leverage versus what we've seen in the last few quarters. I'm just wondering, should we read into this that maybe we're getting to a maximum or optimal point of the current assets of a network and, potentially we should see some improvement or increase in CapEx to support further growth? Is this just a mix issue? If you can talk a little bit about the factors behind the lack of operating leverage this quarter.
Well, I don't think you should read anything into that we're reaching any kind of plateau in terms of the yield we can get out of the existing simulator network. I definitely wouldn't reach that conclusion at all. I think, there's still growth in that. Of course, if you look at the quite substantial order intake we have, in this quarter, CAD 1 billion in civil, I think there's lots of room to grow within where we're at. I think it depends where you're at in terms of our expected growth within the outlook that we've given. I think we'll get a good Q4, and I'll just leave it at that. I think it can be somewhat lumpy, and that can always occur. We usually have pretty good Q4s, so I wouldn't expect that it'd be any different this year. Sonya, you want to add anything?
Yes, I could just add to your point on operating leverage. We continue to see that, as I mentioned in my comments, still very good, solid growth on the training side. Really, the story here is that while we had very good level of deliveries this quarter, there were more deliveries last year. Actually, three more deliveries last year that basically generated revenue because they were all accounted for at completion. It's coming from the backlog that we acquired from Lockheed Martin. That's really driving some of that differential.
Okay, that's helpful. One more question on my end. You're generating very strong free cash flow, and the balance sheet is in pretty good shape, and arguably you have some debt capacity as well if you needed it. Can you talk a little bit about pipeline of opportunities that you see to invest capital either via CapEx like you did with AirAsia and some of the other JVs that you've done or via tuck-in acquisition in the aviation side?
Yeah. Look, I think in terms of pipeline of opportunities, there's quite a number in front of us that we're working on, and we announce them as we crystallize them. Of course, you know we're working on Singapore right now. We're at the tail end of that. That's going well. There's quite a number of those. I see more of an appetite for people to consider the kind of complete training offerings that we have, so that's generating some interest. Look, I think you've seen us somewhat keep ourselves positioned to be able to seize those opportunities because our number one priority remains growth in terms of our capital deployment. I think that remains where we're at. I think that both CapEx and M&A, kind of quasi-M&A, which is outsourcing or JVs, that's how we consider it.
With the guys that those investments that we would make, either way, I don't think it'll increase the level of relative CapEx intensity, all things being equal, as our revenues go up. I think the returns that we're getting on the capital that we are deploying is pretty good, and you can see it transpiring. I wouldn't expect that to change.
Okay. Thank you.
Our next question comes from the line of Steve Arthur with RBC Capital Markets. Please proceed with your question.
Great. Thank you. First, just on military bookings. They were down sequentially in the quarter. Am I right just to assume that that's timing related on specific programs you're looking at, or has there been any material change, better or worse, in the level of bid activity or your win rate?
No, I think military is always specifically lumpy. We don't really control anything about when bids are actually decided upon. All you're seeing is just normal lumpiness. We've always said, I think going back many years, Steve, that it's best to look at defense on a 12 months rolling picture, especially when you're looking at orders. Now, the pipeline of potential opportunities for us is very strong. It hasn't diminished. We still have about, what is the number? About three and a half to CAD 4 billion of bids out there that in front of defense organizations, governments, military organizations around the world for them to decide. I think it's best to look at the book to bill on a 12-month rolling forecast. When you look at that, you're above one.
Right. No, understood. Thank you. Secondly, just on the civil side, the equipment business, you usually don't talk about it as much, but 26 orders in the quarter got my attention, leading towards three strong years in a row of probably around 50 units plus. Is that the new norm for this market, would you think? I've always thought of this in the low 40s. Is that a timing related thing again in this quarter, or is that where that market is heading?
Well, I think certainly when we look at this year, we haven't provided a number, but clearly, I think we'll have a number in the 50s, I would expect. We don't decide on closing them depending if we get this side or at the end of March or not there. It depends on which one crossed the line before, but I think we'll be in the 50s. Whether it's a new norm, I can't tell. The dynamic hasn't changed. It's really basically dictated, determined by the level of deliveries out of the OEMs. As you know, the OEMs are maintaining a pretty strong cadence. Very strong record cadence, I should say, of deliveries. That's forecasted to continue, and some are even talking to grow it, to get out of these eight to 10-year backlogs that they have.
For us, it's about maintaining market share, which we're doing effectively while protecting margins. Look, I can't tell you if that's the new norm, but I think it'll be up there for sure. Some of these 26, it's a good number. I'm glad it catches your attention. It certainly catches our attention as well. We're happy about it, I can tell you that. Some of those, as I said in my outlook, are multiyear deliveries, so people buying ahead. There's a couple of orders in there that are multi-unit. Having said that, I do think we'll be looking at, from what I can see, some pretty good years of high SIM counts in front of us.
Okay. Good stuff. Thanks a lot.
Our next question comes from the line of Cameron Doerksen with National Bank Financial. Please proceed with your question.
Yeah, thanks. Good afternoon. I guess it'd be a question on the training market. I'm thinking specifically about the business aircraft training market. We've seen utilization of business jets ticking higher pretty much over the last year. I guess more recently, we've seen some of the OEMs feel a little more confident about order activity for business jets. I'm just wondering what you're seeing in the business jet market from a training perspective.
Training market's been pretty resilient for us. First of all, really what dictates us is really the utilization of the aircraft. The deliveries, it's good, but it's not like in simulator sales. It's not an immediate effect on the amount of training, except whereas it stimulates people moving to a new aircraft, therefore, you get training demand. The utilization is up, so you can assume that translates into the numbers that we see. It's not a big uptick, but definitely things are moving in the right direction, both in the U.S. and in Europe this year. I'm encouraged by that, but I think we'll see. Certainly, I think, what we saw down south, the U.S. tax reform, will probably have an effect on stimulating demand. That's what industry experts predict, and that's what we've seen in the past when the accelerated depreciation came in.
Look, I think our aircraft business is doing well. It's stimulated by utilization, so I think you can pretty much use that as a proxy for the fortunes in our business there.
Okay. Maybe just second question, maybe bigger picture. We keep hearing more and more stories about a pilot shortage. It's really a global phenomenon. As it relates specifically to CAE, and obviously, that's an opportunity from your demand side, but I'm just wondering from your perspective, trying to retain or hire instructors for your training business and then whether you're needing to pay these guys a lot more to retain them. I'm just wondering if you can comment on how that's going for you.
Well, I think you're right to say. Instructors for us is a very important demographic, and it's key to our offerings. It's something we pay a lot of attention to. Ever since we've been in training business, we've focused on that, the instructor cadre specifically. We've got programs in place to specifically. In fact, we launched a project about three years ago called Project FIN, which was Flight Instructor Initiative, which is us putting in place initiatives which include, obviously, what the financial incentive is, but only part of it. What incentives do you have, career and things like that, which appeals to people so that we can attract, retain, and develop the best instructors in the world in our business. We're being pretty successful.
Obviously, you have issues every too often here and there in certain geographies, but as a whole, we haven't suffered from that as something that stopped or affected our goal for our financial performance in any way. Instructors are important, and a lot of our instructors actually, you'd be surprised, are not necessarily pilots themselves, because it depends what we are actually training. I guess summarize it to say it hasn't been an issue, but something that we watch because you're right to ask the question from the point of view of the worldwide demand.
Okay. Very good. Thanks very much.
Our next question comes from the line of Taran Khattewala with Scotiabank. Please proceed with your question.
Yes, good afternoon. Thank you for taking my question. I guess I was wondering, Marc, if you could just comment a little bit about fiscal 2019. I know you said that you'll give guidance in the next quarter, but just wondering, based on what you're seeing right now out in the market for both defense and civil, is there any reason to believe that growth would be materially different from where you are right now?
I go back to what you said, that we haven't provided any guidance, and we usually did Q4, but I certainly don't think things are going down, that's for sure. I think, look, Andrew, did you want to say that?
Yeah. I can have a stab at that one. We will provide, Taran, our outlook for next year when we report next quarter more precisely. I think that what we're trying to get across is that the big macro drivers for the business are all running very well. In defense, whether that's increased defense spending and a greater propensity to outsource training and services to companies like CAE. In civil aviation, it's a large and growing market that also has a considerable amount of headroom in it for us to grow our position to gain a greater share of our customers' training responsibilities. That lends itself to an expectation for continued good growth and also continued good areas of investment opportunity where we can get accretive rates of return and dovetail into our 13% return on capital expectation.
Thank you very much, both of you. Thanks a lot for that answer. I guess just one more quick one for Sonya. The D&A, I think, was quite a bit lower in Defense in the quarter. I'm just wondering if there's a specific reason for that and how should we be thinking about that going forward?
You're right. It did decrease a little bit in the quarter, and that was due to an extension of a certain program that we have. Therefore, the amortization had taken over a longer period. There is a corresponding deferred revenue, which you don't see on that table, which also gets amortized over a longer period. Net-net, not a huge impact in terms of contribution to the SOI, but it does provide a good view on the run rate going forward on D&A for Defense.
Thank you very much.
Ladies and gentlemen, as a reminder, if you'd like to register a question, please press the one followed by the four on your telephone keypad. Our next question comes from the line of Benoit Poirier with Desjardins Capital Markets. Please proceed with your question.
Yeah, good afternoon. My question is more about the utilization rate of your training network. If we go back in fiscal 2016, fiscal 2017, you basically have been able to increase the utilization rate by almost 8% over two years. If we look year to date, it's been flat to slightly down. I was wondering if you could provide more color about why it's more difficult to increase, and what is the potential going forward with respect to the utilization rate?
I think we're getting to a period that comparable is a little bit more difficult, mainly because of the change in the mix that we had. For example, getting out of our training center JV in Zhuhai, for example, which had a tendency that the training centers that we have in the Far East are running at very high levels of utilization, which tends to skew things to a certain extent. When you just look at the pure utilization number, that doesn't necessarily translate into the yield, I should say. That comparable is different. I think, look, I still see that there's additional capacity in our sim network. As you know, 75% is not 100%. 100% is probably not practical, obviously, but there's still some room to grow within that.
Demand is high, and more and more, what we strive to do is to generate more yield across the existing network by increasing the level of wet training and other services that we can provide across that service center network. Look, I think that I'll leave it at that, Benoit.
Yeah. Okay, perfect. When we look at the margin for healthcare, you mentioned that the mix was less favorable in the quarter. Could you maybe provide some color on what type of mix we could expect in the next two quarters? Also, when we look at the valuation in the sector, the valuation is very favorable. I was just wondering whether you see an opportunity to maybe crystallize some value for healthcare.
Well, I will start by the first one. The second one, sorry. No. Look, we're still committed to this business, and I feel very confident that the strategy we have, which was admittedly course-corrected last year to focus, and just to remind you, remind the listeners, to refocus our strategy on going after the largest pools of value in this sector, in healthcare simulation, which is really the
[Foreign language] L'éducation de l'infirmière. Nous sommes très concentrés sur cela. C'est un marché important qui est desservi aujourd'hui. Nous avons lancé de nouveaux produits. Le premier est CAE Juno, pour cibler spécifiquement ce marché. Jusqu'à présent, je suis assez satisfait. Cela a pris du temps pour se traduire dans les chiffres, mais nous sommes assez confiants que cela se produira et c'est dans nos perspectives. Mais les produits que nous avons, Juno en particulier, ont été très bien accueillis sur le marché. Nous ne rapportons pas séparément les commandes dans ce marché en raison de la dynamique particulière et des chiffres relativement faibles. Mais je peux vous dire que si je devais regarder cette métrique, nous sommes en hausse de 20% en glissement annuel juste sur les commandes de cette gamme de produits, et ce sont des bons produits en termes de marge. Je pense qu'il s'agit vraiment de l'avenir.
[Foreign language] Il s'agit de faire croître le chiffre d'affaires en vendant ces produits sur ce marché existant. Avec la marge des profits de ces produits, cela ne prendra pas longtemps. Cela ne prendra pas beaucoup de croissance des revenus, que nous prévoyons, pour que nous puissions générer un profil de bénéfice avant impôts nettement différent en termes de pourcentage.
[Foreign language] D'accord, très bien. Merci beaucoup pour ce temps.
Welcome.
[Foreign language] Opérateur, c'est tout le temps que nous prendrons cet après-midi pour les questions des membres de la communauté financière. J'aimerais maintenant céder la parole aux membres des médias, s'il y a des questions de la part des membres des médias.
As a reminder, if you'd like to register a question, please press the 1 followed by the 4 on your telephone keypad. Our first question comes from the line of Julia Fono with La Presse Canadienne. Please proceed with your question.
[Foreign language] Bonjour monsieur Parent. Petite question juste sur les résultats, le recouvrement d'impôts de CAD 24 million. Qu'est-ce qui, de cette partie-là, est attribuable à la réforme fiscale américaine ?
[Foreign language] Je vais laisser parler Sonya, mais essentiellement, presque la totalité du retour d'impôt, c'est un impôt différé qu'on avait, qui nous fait qu'on sauve CAD 34 million, CAD 33.7 million exactement d'impôts. Peut-être je vais demander à Sonya qui est notre cheffe de direction financière si elle veut avoir un peu plus de détails.
[Foreign language] On était dans une position de passif d'impôts reportés aux U.S. Avec la réduction du taux d'impôt, c'est la raison élémentaire pour le recouvrement ce quart-ci, pour un total de CAD 34 million.
[Foreign language] Ok, c'est 34, pas 24, c'est ça?
[Foreign language] En CAD, oui, exactement. C'est 34.
[Foreign language] Avez-vous calculé sur une base annualisée ce que ça va représenter en économie d'impôt, cette réduction-là, pour CAE?
[Foreign language] Oui, ça représente à peu près 1 à 2 points d'impôt globalement pour la compagnie. Une réduction de 22 à 20 à 21 comme taux d'impôt.
[Foreign language] En pourcentage.
[Foreign language] En pourcentage, oui.
[Foreign language] En pourcentage, vous ne pouvez pas chiffrer le montant en dollars avec une estimation.
Non, parce que ça dépend du montant de revenu d'impôt qu'on ferait à ce moment-là.
Ok. Et ma question pour vous, monsieur Parent, sur cet aspect-là, c'était ce changement-là quand même, vous n'avez pas de chiffres à nous donner, mais ça doit représenter quand même des économies substantielles étant donné que les États-Unis, c'est presque le tiers de vos revenus. Est-ce que ça change quelque chose dans votre stratégie ? Pourriez-vous être plus agressif aux États-Unis, investir davantage là-bas étant donné que les conditions fiscales sont meilleures ?
C'est certainement un avantage si on regarde, je pense à l'exemple que vous donnez, si on voulait regarder une acquisition potentielle. Mais on est commis au Canada, une compagnie canadienne, avec notre siège social à Montréal. Nos activités de recherche et de développement sont essentiellement ici, notre siège social est ici, notre cerveau est ici. Ça va rester. La façon qu'on regarde nos investissements un peu partout à travers le monde, c'est vraiment de regarder stratégiquement comment est-ce que ça contribue à notre mission d'entraînement. C'est plutôt comme ça qu'on va regarder comment on va décider sur nos investissements. C'est certain que ça a un impact parce que si on regarde un investissement aux États-Unis spécifiquement, toute chose étant égale, on pourrait dire que le coût de l'acquisition pourrait être moins cher.
Ça serait moins onéreux pour nous, moins difficile pour nous de générer une situation où on ferait de l'argent à plus court terme. Mais ça, c'est juste une des considérations. Ce que je dirais en gros, c'est que ça ne change pas notre stratégie d'entreprise.
Ok, merci.
We have no further questions on the audio lines at this time.
Ok, operator, I want to close the call at this point. I want to thank all participants, members of the investment community, as well as from the financial press, for participating with us this afternoon. I would remind you that a transcript of today's call can be found on CAE's website at cae.com.
Ladies and gentlemen, this does conclude the conference call for today. We thank you for your participation and ask that you kindly disconnect your lines.