CSL
#I think our goal is to have CIT above 20% on that.
And so I think if you take the one-times out, we've got work to do and new product development, but as we see it now, again, 20%-plus is our goal.
With purchase accounting, initially it will have a little bit of a dilutive effect, but we expect these margins to get very close to the base business quickly.
Certainly as we move in and throughout next year, towards the of the year we would expect margins to be close to the base levels.
Well, we look at that market and we think with the Star Aviation acquisition it puts us around that ---+ I'm going to say just broadly, 15% to 25% market share.
I think with the work we've done with the innovative universal adaptive play, the receptivity we've had from OEs, aerospace manufacturers and that, we definitely want to be higher than 25% of this.
We want to be ---+ have a leading position in this market.
So I'm not going to give you an exact number, but obviously there are other competitors.
But we'd like to increase over the current market share we have right now as a percentage.
Honeywell and Panasonic are the two biggest players.
The replacement market is probably in that low single-digit, <UNK>.
Yes, don't think weather was a factor, but I think maybe similar to the third quarter last year, there were some labor issues that I think were a little bit of a headwind for us.
We also expected maybe a little bit higher growth than we experienced, but again, I think labor was a bit of a factor and I do think the margin performance here really is the story.
And we're just very pleased that the business is performing at these margin levels.
Sure.
Right now, <UNK> just said earlier, MDI prices, we see some increases coming there and so we want to make sure we get ahead of that.
I would say in the rest of the raw materials it's been fairly flat as <UNK> said earlier as well, when we look at that price to raws ratio in the fourth quarter, we'll start to flatten out, so right now we're seeing relative stability, but obviously if anything came up, we will get ahead of that.
Again, we're still focused on growing the business through investment for organic growth and acquisitions and where we're hopeful that we're going to have larger acquisitions to announce, that remains our number one priority.
So assuming that we are successful on the acquisition front, I think you can expect us to continue to repurchasing shares pretty much at the same levels as you've seen in the last few quarters.
If things are not as actionable as we believe they will be on the acquisition front, then we will be more aggressive on share buyback, but right now we remain optimistic and hopeful that we can be successful on some significant acquisitions.
Not really.
I don't think so when you compare the systems to standard on an overall basis.
Yes, <UNK>, I think we said it in the acquisition, we still feel very strongly about the actions we are going to take to drive margin improvement, as well as sales growth, but really margin improvement in that business, and the footprint consolidation has started.
We've dealt with a couple of facilities, we've moved the headquarters, we're working on a vertical integration right now, and we deployed significant amount of capital there to drive that.
So as we start to roll this out, our goal all along was to get this margin back to the low 20s, and then when you add the purchase accounting that remained, we'd be right in line with that 30% margin.
So that's the track and I think it will take a few years to get there so we would like to see a steady progression as we take these actions and really just continue to improve every quarter as we go through that improvement, and then in the three to five year range, get to that 20% mark.
Yes, it is almost all goodwill.
Yet it will carry over into, certainly into the Q1 of next year.
It may also carry over into Q2 of next year, so we will have some continuing China startup expense.
I would sort of plan for really most of the first half of next year.
We effectively have two facilities there now, so there are some redundancies and some inefficiencies that we are capturing in our number.
We brought a new leadership team in just under four years ago.
They put together a great plan, it's centered around really factory consolidation, then working on the factories for improvement, and both that entailed our operational excellence program, COS, Carlisle Operating System, as well as investment, capital investment in the processes, investment in the sales force, getting focused, and really, they are looking now to drive leverage off of that more efficient production base.
So it's been study, the team has done a nice job, they've stuck to their strategies and have really driven the operational efficiency through the business.
In CIT.
Well, you can see by the continued ramp-up of the ARINC 791, I mean, we are really pleased with that.
That's bringing along some other opportunities that will hopefully unfold in 2017.
It brought along the Star Aviation acquisition.
Micro-Coax has some very interesting products that we are seeking to push development on at launch over the next couple of years.
And then, when we look in the regular business, CIT continues to seek to be a bigger player on the aircraft platform and our relationship with Boeing, our relationship with Airbus, and these other major airline manufacturers, we want them to look at us to be a solution provider.
I would note that with our Star Aviation acquisition we were able to acquire a nice engineering center in Everett, Washington, that works closely with Boeing up there.
We hope that will drive other new product ideas for this business.
Yes, <UNK>, I don't know.
I think maybe on the margin a little bit, but I don't think it's really going to change our forecast certainly for the quarter.
Thanks, <UNK>.
Well volume recovery would certainly help, but the actions we're taking, we're driving for that single-digit as a minimum, and return to profitability, and strengthen the cash flow and everything else, at the volume levels we kind of project right now.
Yes, moving into 2017, as we said, I think we're going to see more of the same.
We've mentioned it a couple times, we like what we've done in the margin profile, we see raw material stability, we see relative stability sequentially in pricing, those are good indicators.
On the growth side, the US markets are still strong.
We see fluctuations within each of the verticals that we serve and some differences there but that occurs in any year.
So I think what <UNK> mentioned on the labor, we are getting to the end of the season, we think there's good backlog and we think there might be some pressure on labor.
So, I think things are pretty much as we said, we're looking for stability and moving generally in the direction we've been headed so far this year.
Thanks Megan.
This concludes our third quarter 2016 earnings call.
I want to thank everyone for their participation and we look forward to reviewing our year-end 2016 performance with you at our next earnings call.
Thanks and good night.
