All right. Well, thank you, and good afternoon, everyone. My name's Adam Samuelson, Senior Vice President on the Aerospace and Defense Equity Research team here at Jefferies. Thanks for everyone continuing to attend our annual Jefferies Global Industrials Conference here in New York. Today, we're lucky enough to have Brad Williams, the CEO, and Blaine Browers, the CFO from Cadre Holdings joining us.
Brad has served as President and Chief Executive Officer of Cadre, joined in 2017 as the COO and was promoted to President in 2019. Previously had various leadership roles at IDEX, Danaher Corporation, and Ingersoll Rand Inc. Blaine Browers, the Chief Financial Officer of Cadre since 2018. Before joining Cadre, he had progressively senior finance and IT leadership roles, also at IDEX, as well as BAND-IT, IDEX Optics & Photonics, and Micropump, as well as previous roles at General Electric. Brad, Blaine, thank you both for joining us today.
Thank you.
Maybe just to start, for those who are newer to the story, just maybe to level set, can you write us a high-level overview of Cadre today across public safety, Nuclear Safety, and maybe just how the portfolio's evolved since the IPO?
Yeah, absolutely. Thank you guys for joining us, for those here in the room and are listening in. Again, I'm Brad Williams. I'm with Cadre Holdings. I lead the company overall and excited to talk about who we are here for a couple of minutes. A private company, 60-plus years, before going public. A very long heritage in the public safety space is where we grew up, with a bunch of leading brands. We went public in November 2021 through a traditional IPO-type process. When we went public, we talked about diversifying in terms of an industrial-type company. No surprise, based on mine and Blaine's backgrounds and others within the company, being with IDEX, Danaher Corporation, and Ingersoll Rand Inc. Through that transition, we've done quite a few things.
One, we've implemented our Cadre Operating Model, which for those that know industrial-type companies, it's the mainstay of what happens within an industrial company. That's one change since going public, that we've put in place, and we're doing extremely well with our operating model. The second piece has been our M&A story. We've acquired seven companies since going public. Five of those companies have been within public safety, to continue to build out our leading position within the public safety portfolio. Then two of those companies have been within the Nuclear Safety segment, which is our first diversification play since going public in 2021. I'll spend just a couple of minutes on the main product categories within the company. We do focus on safety and survivability products. Think of our products as being very critical to those professionals that use our products on a daily basis.
Within public safety, the big product categories are Body Armor, that's things like Hard Armor and Soft Armor. The second category is Duty Gear, mainly the holster, being the main product category there. The third-largest in terms of public safety is EOD, so explosive ordnance disposal. Think of that as bomb suits that bomb technicians wear around the world. Then the fourth category I already mentioned, which is Nuclear Safety, where we have products, everything ranging from highly engineered containers, to ventilation systems, to alarms that are used in facilities that we need to make sure we're alerting folks if there's a nuclear-type issue that's going on within those facilities. So, a wide range of products within the nuclear portfolio also.
That's who we are in terms of what we were before going public, what we've been doing since going public, and then where we are today overall as an industrial-type compounder.
That's very helpful. Just as we think about where we are today moving forward, organic growth, tracking at the high end of that 3%-5% framework in the second quarter, you've maintained your full-year outlook. As we think about where the business is trending in the second half of 2026 into early 2027, just help us think about what are the biggest drivers that can sustain that organic growth range and that mid-single-digit level.
Right. No, appreciate the question. I think first thing when we think about the business, we have a variety of products, as Brad kind of just walked through. One important thing is don't think about us just as a quarter-over-quarter business, right? There's a portion of our business that is more project-based, which creates some seasonality or some lumpiness quarter to quarter. That's one thing we talk a lot about. When we think about that 3%-5% , we think on an annual basis, and that's, I think, the right view to have on it. When we talk about how do we sustain the 3%-5% , we start and just split the business in two. As Brad talked about public safety and the nuclear side. The public safety side, we're supplying primarily equipment for officers or military personnel.
On the law enforcement side, it is very steady. We have data in the U.S. law enforcement markets, goes back into the early 2000s, so it's a very consistent 3% growth in that budget, right? That's through the financial crisis. I think that's the only year it dropped, and it dropped, I think, down to just less than 1%. So it's always been on the upper trajectory, very consistent. That 3%-5% , that's what gives us a lot of faith in that baseline 3% growth for the business. That's holsters and Body Armor. When we think about that 3%-5% , that range, what really is the inflection point? There's a couple of things. There are some large projects. Majority of our current business is with state and local agencies. There's federal agency opportunities.
We recently won as a partner for the Body Armor for the FBI, right? That's a five-year contract, IDIQ. That is a significant win. Second piece I'd add on the EOD side that can inflect us up, and there's really two opportunities that have come to fruition lately. One is we have a Blast Sensor, which we're supplying to United States Special Operations Command, which measures concussive force that operators are exposed to, and that's a $50 million IDIQ award with POs received over $18 million so far in the last nine months. So that's another kind of game changer for us. Then the third part when we think about that is, it's a recent contract. It's a product we've had for a number of years. It's Blast Attenuation Seats.
These go on military vehicles, and they are designed to absorb some of the force if a military vehicle is exposed to explosive forces. That was an $87 million seven-year contract with GDELS, so General Dynamics European Land Systems. So that's a really nice exposure to some of that European spend that's been going on. So those are on the public safety side. Those are some of the inflections. We also had recently acquired TYR Tactical, which is a global Body Armor company based in Phoenix, which is very focused internationally. Over half their revenue comes from international markets, for Canada and Northern Europe, who have great exposure into European militaries, and they've seen and continue to see very consistent growth there, which we think will continue to drive that organic growth.
On the nuclear safety side, those markets, when we look at them, we think about them as a 4%-6% grower. We are not kind of betting. This is not a bet on AI or SMRs. We acquired our first nuclear asset in 2024, started our diligence in 2023. We really view there are three sectors or three verticals within nuclear. There is national security, so think the nuclear weapons side. There is environmental remediation, and then the third is commercial nuclear. We look at that and say the first two are very steady. There is a common problem for most Western countries that you have an aging weapons nuclear stockpile. There is congressional funding as well as a mandate to increase pit production in the U.S., which we have products that are used in the production and storage of those materials. So very steady, very consistent.
In environmental remediation, just in the U.S. alone, there is over $500 billion of nuclear waste that has to be disposed of. This is primarily Cold War storage, weapons production facilities where we have material in the ground in many cases that we are unaware of what it is. We have not determined what level of radioactivity it has and how do we dispose of it. So we provide non-destructive assays, so the ability to characterize the material. We provide containers for over the road storage as well as permanent storage. Then the third vertical, when we talk about commercial nuclear energy, we have a number of opportunities there. I think it is very exciting, the AI and the nuclear renaissance. Our view is probably still a little bit more conservative. There is certainly a lot of momentum.
In the last nine months, we have seen really orders move from the sales funnel into POs being placed as people are starting to break ground on fuel enrichment. Our exposure there is robotic arms, those containment solutions. Brad mentioned the Criticality Accident Alarm System. So, a number of exposures. I think that nuclear side, there is a pretty steady kind of 4%-6%. Because of the concentration, though, when you think kind of year to year, I think we are going to see years that are high singles, low teens, and we may see years that are kind of low singles just depending on how the projects line up because it is not a very wide customer base.
Got it. As you think about the funding side of that, how do you feel about clearly a lot of growth on the commercial nuclear side for kind of as a bit of another nuclear renaissance, so to speak. But how do you think about the funding, especially on the remediation side, which does not seem like it ever gets the funding that people think it should get?
Well, I think no one would argue it gets all the funding it should get, because I think if it had all the funding, we'd be cleaning up the sites immediately. But I'd say it's been very steady. There is broad support, regardless of administration, to clean up these sites. There are some that are very sensitive, where you have radioactive materials stored near rivers and water sources that have to be cleaned up. So when we look over the long period, it's very sustained, very healthy. But we just haven't seen any major cuts on that side that would concern us.
Okay. Great. Maybe going into kind of talking about some of the acquisitions that you've done recently that you think have been notable. TYR Tactical, Alien Gear both this year performed ahead of expectations. Maybe starting with TYR, which is one of the bigger acquisitions the company's ever done. Help us think about why that kind of had that fit within the portfolio, kind of the revenue kind of product synergies and as well as some of the cost opportunities that might be unlocking.
Yeah, absolutely. So starting with TYR Tactical, there's a few reasons why we acquired TYR, even though we've had Body Armor companies for many years and it's a long heritage that we've had Body Armor within the portfolio. So when you look at TYR's revenue, it's actually the opposite of Safariland Armor's revenue. Okay? So what does that mean? What it means is TYR has, as Blaine already mentioned, a larger concentration of international, mainly Northern Europe, revenue of militaries there, or MODs within Europe. The second piece is they also have a large concentration of government agencies in the U.S. So for example, like ICE, or they had the FBI contract before Safariland won the recent contract. So they have that government presence. Okay? So mix of customer and geography was a big benefit to that acquisition. So that's one.
The second reason we acquired them is their excellent abilities with Hard Armor. Okay, so Safariland, on the Armor side of things, sells Hard Armor, but it's a small part of what the company manufactures and innovates. The capabilities of Hard Armor within Safariland is very limited compared to a TYR Tactical. And in fact, new advanced raw materials, ballistic materials that we buy from various suppliers like Honeywell and Dyneema and others. Those materials, to get the performance that we need out of them, require a very high pressing power. All right? I won't get too technical there, but just think of pressing power. And TYR has two large presses that we estimate there's only about four of these presses in the entire world, and they have two of them.
Very large presses that can press the materials at the temperatures and the pressure and the heat and everything we need with redundant equipment to basically manufacture those next generation Hard Armor type products for the companies, either TYR or Safariland. That is the second reason. The third reason is, TYR has put a lot of focus into female body armor, and there are females within agencies in the U.S. is about 15%-20% of the population of law enforcement, and the same in some militaries around the world. That is really important because that female voice within law enforcement and military has increased significantly to making sure that the Body Armor that they wear is also comfortable for wearing the Body Armor 10, 12, 14 hours a day, depending on what their profession is.
TYR has done a lot of work in the female body armor side of things to the point that they have patents on female body armor, and then they also have done empirical testing on females doing athletic activities. This was done through a third party in a university where they have got test results showing that those activities are less strenuous wearing the Body Armor of TYR with those designs versus other competitive designs. We like the company for those three reasons.
We think it is a great, phenomenal fit with a lot of synergies, both channel, product, cost, facility, footprint, you name it, across the board. There is almost any synergy that you can check the box. Now, those synergies do not happen overnight because you are talking about products that are there saving lives. That is our mission. Together we save lives when you look at our portfolio of products today.
We do have to take care with testing requirements and making sure that we get recipes and products right before we release those things to the market. We are taking a step at a time with the integration. We are done with all the functional integration activities, all your standard stuff, finance, accounting, legal, tax, treasury. We are right on track with that side of things, and then the rest of it will come as we go along here.
Got it. That is helpful. Maybe staying in the Body Armor and kind of that police force kind of customer set. How do we think about, and you talk about how steady that overall kind of business was and some of the funding for different police budgets are. What is happening with hiring? Are you seeing that kind of, especially I think about homeland security, is that creating new opportunities and new demand vectors that maybe had not seen for a number of years?
I wouldn't say demand vectors we haven't seen for a number of years. The other thing we love about our business are what we call replacement cycles for these products. In the U.S., Body Armor is about every five years based on the warranty of the product. In the U.S., is five years . When you hit the five-year point, you get resized because you may have been at Dunkin' a little too much, right? Your body shape and type changes. It just happens to all of us as we get older, typically. You'll get resized, you'll get new Body Armor. We love the replacement cycle from that perspective on Body Armor.
When you look at the Duty Gear side of things or the holster, because that's the majority of the revenue in that category, it's every five to seven years . That's a different reason there's a replacement. There's actually a few reasons. One is wear and tear. Doesn't happen a whole lot, but it can happen. That doesn't drive most of the revenue. It's a very small portion of the revenue. The second one is when accessories are added to weapons. If you add a light to a weapon, which is a big trend that's been going on around the world, or you add a red dot sight, which is there for those that may not know, it's there to help you shoot more accurately. Depends on who you are, right? In terms of shooting and how accurate you can shoot. It does help some people.
When you add those two things to a weapon, it significantly changes the dimension of that weapon. If you think about it, that becomes part of the weapon, either under the barrel for the light or on top of the barrel for the optics. You need a new holster. Because these holsters are not your old leather. Well, we do have leather, but that's kind of a smaller part of the business. They're not holsters that doesn't retain the weapon. It actually locks the weapon in place. That's why we consider it a life-saving critical device for law enforcement or military. In fact, if I had one on right now and I said, "Hey, sir, come up and try to take the weapon from the holster," you would not get the weapon out of the holster.
In fact, not our latest save that we just received today, but the save right before that, because we have a prestigious SAVES CLUB where folks that are using or wearing our products and their lives are saved, they go into this club. We had a Duty Gear saved, and the officer sent us pictures of his holster. He had got into a fight with a perpetrator that was trying to take his weapon. What do you think would happen if that weapon was taken? The officer would either be shot or killed or one of us, because as an innocent bystander. Don't take for granted that these products aren't life-saving devices. They truly are. The replacement cycles are extremely important to our business.
Typically agencies, now I'm going to come back around to your question real quick, agencies follow those replacement cycles pretty well. So even if we launch a new product, it's not to trip that replacement cycle typically and make it pull in. It just doesn't happen, no matter how great that product is. I didn't mention it, but our share of holsters in the U.S. is greater than 85%. In law enforcement, we have most of the U.S. military. Our bomb suits around the world, we've got about 90% share, so we're the leader in bomb suits. We launch new products to help us maintain and protect share. We don't launch those products typically that will help pull in that replacement cycle.
Some of these additions that you've seen, we did see some revenue in Q4 of last year and a little bit at the beginning of this year related to U.S. Immigration and Customs Enforcement headcount increases that you'd mentioned, using your example. And when that happens, when there's more feet on the street, that adds more of our products. Because it's one for one. These products typically are not in inventory at an agency. And in fact, Body Armor's a fitted product to your body shape and type. So in law enforcement, it's not small, medium, large, extra large. It's typically fitted to you because you want to have maximum protection for your safety. Holsters is specific, and those are usually also bought whenever you add another officer.
We haven't seen, other than when large increases happen, like happened with U.S. Immigration and Customs Enforcement, we don't see premature replacement cycle increases along these categories.
Okay. Well, that's very helpful. Thinking about the growth where there is new products or new applications driving incremental demand, you alluded to the contracts you won with United States Special Operations Command for Blast Sensors. You talked about the Blast Attenuation Seats with General Dynamics European Land Systems. Help us think what the opportunities that those could potentially unlock as kind of-
Yeah
key proofs of concept for the different military applications.
So let's talk about sensors. People are getting, and that's partly potentially our fault, but there's sensors and there's seats. Let's take the word blast out because people kind of confuse those for a minute. Let's talk sensors for a minute. As I mentioned, we are the leader in EOD, explosive ordnance disposal, bomb suits in the world. Most any military or law enforcement agency that has an EOD team, they're wearing our Med-Eng. M-E-D-E-N-G is the brand name, just like Safariland is well-known for holsters and Body Armor. When you look at sensors, we've been doing sensors for many, many years within the bomb suit category. We got involved in a paid R&D program with United States Special Operations Command, to take our sensor technology and their specification and design a sensor that can be mounted on field soldiers. You might ask, "Well, why?
They've got all kinds of stuff they're wearing on their body. Why do they want to wear something else?" It's to help them. Traumatic brain injuries, TBI, is a big problem for our folks in the military. I don't know if we have any veterans in the audience. If you are, raise your hand, if you don't mind. No veterans here, but if we got any veterans out there, thank you for your service, because that's what we live every day, which is to try to help our folks in the military or in public safety. TBI is a big problem. These sensors are placed on field soldiers.
Not only did we do the R&D program with United States Special Operations Command, but we won, I think we had mentioned already, a $50 million IDIQ with United States Special Operations Command, to supply these Blast Sensors that we finished the R&D work on. What does that Blast Sensor do? It does a couple things. I'll simplify it, but if you're doing field training and you're around a lot of blast exposure, the sensors will tell you you've maxed out on your blast exposure. Think of it like if you're playing a football game, and I'm talking American football, and there's a concussion on the field. What happens? There's rules against that. You're in the game or you're out of the game. Think of the sensor saying, "Blaine's been exposed to too much blast. He's out of the game. Go sit down.
We are trying to help those folks that are in the military, that are out there protecting us, to make sure that we can help them from a TBI perspective. Okay? That is one. The second thing that happens is the data that our sensors collect, there is a significant amount of data. That data is pinned to you and your medical history, okay? So that clinicians and folks can then determine, is there something going on that we need to try to help with new products and things like that can help more protect these folks. How big is the opportunity? It is large. We sized it, when we were going public in 2021, at about $500 million if every field soldier gets a Blast Sensor, okay? That is the extreme. That is the high end. Will that happen? Probably not every field soldier out there.
We do think over time we will see an adoption of Blast Sensors for soldiers as we go forward. In fact, we have, and we have not disclosed them, but I think we are up to seven countries now that have requested our Blast Sensor. We have shipped the Blast Sensor to them, and they are doing testing on the Blast Sensor. I think the biggest question that is out there will be, will every country and every branch of the U.S. military at some point when they do decide, or if they decide to move in this direction, will they want the Blast Sensor that we currently have done the R&D work on for United States Special Operations Command, or will they want their own flavor? Okay?
If they want their own flavor, what we have experienced, it takes a while to get that to the point that you actually have a product that you can then hand over and sell to them. That is where that one is at. From a blast, I said I would not say the word, from a seat's perspective, that is a product, not a new product for us. It is a product we have had for many, many years. We ship seats on a monthly basis. Okay? It is just the programs have been much smaller. Okay? We are applying seats to OEMs around the world that are going in vehicles. This program happens to be very large. As Blaine Browers mentioned, it is $86 million-$87 million over a seven-year period. It is going to General Dynamics European Land Systems, and the end customer is the German military.
What we are seeing there is we are seeing that increase in defense spending at various countries. We also won the German military, German Ministry of Defence holster contract through our Italian holster company that we acquired in 2022, a company called Radar 1957 in Italy, and they did a phenomenal job, and they won that one, for example. Through our crowd control business, we are seeing growth in South America.
We have also got some significant Body Armor opportunities that we are seeing in South America also. That influx of focus, let us call it, in the defense spending, we have seen it help us, at times. We are not the folks that are playing offense. We are the folks with defensive survivability type products that are also important to what is going on out there. But there is that replacement cycle that typically happens once these products are acquired.
No, that's very helpful. Maybe pivoting a little bit and we think about how that growth is starting to translate into the bottom line. Second quarter, strong margins, EBITDA margins a little over 20%. Maybe that was a timing and volume leverage and mix and a lot of favorable all uniting as one, but Cadre does have longer-term aspirations for mid-20% adjusted EBITDA margins. How do we think about bridging to that from where the company's running today in that high teens, 20% range?
Yeah. So absolutely. We believe the company and the products has the ability to be in the mid-20s, and that's organically, just to be clear. That's not buying our way there with new assets, just the core products we have today. And we really boil it down to a couple things. One is a focus around price. We target getting 1% price net of material inflation, something we've hit every quarter, since we've IPO'd and prior. But to give you a little bit more of a flavor, we don't see large material inflation. A big material inflation for us, even during COVID, would've been less than 1% of revenue. So our pricing doesn't need to be 5%, 6% . That price to get that 1% is a point and a quarter, point and a half, maybe 1.75% . So I think that's the first pillar.
Second pillar is really productivity. So the idea of continuous improvement, Kaizen. We have the Cadre Operating Model, which has many tools underneath which we can leverage. But if you think about it fundamentally, every plan, every business has a 12-month rolling productivity funnel where they're focused on how do we do things a little bit better? How do we make life a little bit easier? And that's there to combat inflation, labor inflation, as well as overhead inflation, and also add to the bottom line. And the third piece is really operating leverage. A lot of the markets Brad and I have talked through are mature markets. We're not growing at 10, 20%. We don't need to field a brand new sales force or spend $10 or $20 million in R&D. So there's this operating leverage because we have that footprint out in the market.
So when you add those three together, you can take a 3%-5% grower and get 10% bottom line. I won't say easy, it's a lot of hard work, but all the tools are there. And go back and just make a point emphasis on the operating model. I talked about it really when I was talking productivity, but the operating model really kind of bridges across. Those tools are applicable in price, whether it's power pricing, leveraging 80/20 and how you view your customers, how you price MOQs, through productivity, meaning operating leverage. The idea of an empty chair Kaizen. So when someone leaves, you don't immediately go to fill. You ask first, what responsibilities are there? What were they doing? What do we still need? Because a lot of times in companies, things just kind of carry on without adding value.
A lot of the company and core focus is really just on how do we get a little bit better, broadly across, and that is, again, not just on the manufacturing floor. That extends to the back office out to our customers.
That is very helpful. Maybe just before we start to wrap up, I want to make sure we touch on the M&A piece, because M&A and inorganic growth has been an important part of the story pre- and post-IPO. Just remind us kind of where we are on dry powder. What does the funnel look like as you think about the opportunity set across public safety, and nuclear, and how do we think about what are the non-negotiables in M&A for you guys? Because you guys have done a range of businesses, profitability-wise, size-wise, kind of geographic. It is interesting. You have done a lot of different types of deals.
Absolutely. I think first, maybe before we dive into some of the details, just kind of overlay. The M&A is a core part of who we are as a company. With that 3%-5% top line, and we are very low CapEx, less than 2% of revenue, we generate a lot of free cash. We view a lot of the business as generating cash, and the current focus is really, as you mentioned, on M&A. We ended Q2 at 2.5x levered, net leverage. We have always said 3.5x is our upper limit. That leaves us with about $120 million of dry powder. Kind of adjacent to that, equity is always an option, right? Depending on where the stock is trading. Actually, TYR Tactical, which we closed in January, was the first acquisition we leveraged equity.
That is something we are thoughtful and prudent on. Certainly, stock price will depend. Today we would look at it and say about $120 million of dry powder. When we think about M&A, you ask what is really important to us. A couple things are equally important. One is that free cash flow generation. We are not interested. We have looked at numbers of businesses that are really attractive, have nice end markets, but are not generating cash flow. It is that low CapEx model, generating cash flow is really, really important to us.
The second piece is those macro tailwinds. We are not looking for I know we have the nuclear, and we talked about this nuclear renaissance in AI, but keep in mind, we made that foray into nuclear well before that was there. That is not what attracted us to the market. We are looking for steady tailwinds over the long run.
Right? For us, that 4%-6% in nuclear without the nuclear renaissance is what really makes it attractive. That recurring profile is important. The last piece that is really important to us is not being a major component to our suppliers or to our customers. We do not want to be the large component. When we think about price, one of the advantages, if you are a small percentage of the overall finished product for your customer, you have that ability to price. Think about that dynamically, not as a widget that goes into a bigger widget, but think about a law enforcement officer. You are talking about a holster, a $102 holster, when you think about what they are wearing overall. Between Body Armor, radios, guns, all the equipment. We like to stay at that low component cost that allows us to have some freedom on price.
That is not to be greedy on price. We are very thoughtful on that, on that approach. To keep the margins and the shares we have, you cannot overdo that price piece. That is the third final piece that is really important to us.
Let me add one thing to that really quick is the safety part of the products is critical and the engineered side of things. Blaine Browers is referencing the invoice value versus the total, but when you look at the products that we have, we want them to be really sticky. We want you to think twice about going from one Body Armor supplier to another one. Because you are concerned about potentially their product exposing you to danger, for example, or going from one holster to another holster.
Or like one of our customers, we unfortunately lost a bomb suit, we do not lose very many because of the share I talked about earlier, but we lost a bomb suit opportunity. When the technicians go out and they actually go on a real call, guess whose bomb suits they use? Ours. Then guess whose bomb suits they use for training?
Our competitors. Right? That shows you that somebody in procurement got involved and helped that decision along based on something that was out of the technician's control. So they trust our equipment. Right? That is extremely important to us. Back to that mission of saving lives. So highly engineered products, super sticky, super critical. We do not want you to leave those products. We want you to think twice about that.
Great. We're almost out of time, so maybe just as a final closing question, just to wrap up. If we're sitting here five years from now, what do you hope investors recognize in five years that today is the most underappreciated part of the Cadre story?
I would say in general that people would probably underestimate the amount of runway that our operating model has for the business. That's one thing we get quite a few questions about. It's, "Well, what does a Nuclear Safety business have to do with a Body Armor business or a public safety company that you own?" I don't see any similarities. You can't collapse the channels down, you can't share the sales force. In terms of manufacturing, you're doing cut and sew over here, typically, in a lot of cases, in Body Armor and bomb suits and injection molding and holsters and leatherwork and things like that. But then you're cutting metal and you're machining over here on the Nuclear Safety side. The one common thread is our operating model.
If I can't stress that enough, if you grew up in industrial companies like we have and a bunch of others on our team, and you drink that Kool-Aid, you really begin to understand what operating models do for a company in terms of those long-term synergies. No matter if it's on the shop floor where you're manufacturing products or what I call carpet land, where you're out in a cubicle or in an office and you're manufacturing something else. Okay? Those synergies go across both, and it applies no matter what the business is. I have a feeling as you fast-forward five years, that'd be the one that I want to continue to stress for folks.
Great. Well, on that, I think we're going to be just about out of time. Brad, Blaine, thank you so much for the time today.
Thank you.
Thank you.
Appreciate it.
Appreciate it.