COL
#For this year we've assumed that they sustained rates for FY16 ---+ and by the way they would have to cut rates here within the next quarter probably to have any impact on our 2016 - so the real question is how many aircraft in our FY17, and we've got a little time before we're providing 2017 guidance on that.
I suspect we will have a better handle when we do put that guidance out.
Typically, this is an area where we do align pretty closely to what the OEM is saying.
We don't find much variability, so I'd listen to what Boeing says and assume that's going to flow-through to us.
By the way, the 777 is, the existing 777 is a pretty high BFE-content airplane for us, so it's not ---+ a rate cut will have some impact on us.
First of all, the predominance of the low double-digit decline was the Globals.
Then as we said we provided some additional ---+ what I will call general discount to the mid-to-light going into the year.
No, I haven't seen that necessarily consumed, but I'm also ---+ we are just starting and market conditions have been generally soft.
I will say that the announcements or the earnings calls since we put out guidance haven't indicated significant weakness in production rates, so hopefully I'm wrong and won't need the discount, but I think it is prudent given the history we have seen ---+ and utilization rates just have not been very strong and backlogs still are relatively weak ---+ we will have to see how that plays out.
What really drove in the quarter was mandate-related activity.
We've got a couple new FANS which are navigation system updates that we've got certified and will enter into the market.
We started to see a little bit of that.
But I would say the good quarter was, from a discretionary perspective, was predominantly the mandate-related activity.
That mandate activity is going ---+ is not going to grow in 2016, that will probably be a little bit of a headwind for us going forward into 2016.
I don't know.
I guess about mid-single digits.
I would agree.
I think we've reached a steady-state run rate on 787 sparing, so I agree with you, I don't think that's going to be headwind next year for us.
It was $16 million in total, <UNK>, split basically 50/50 between the two businesses, so $8 million each.
Sure.
No, we will treat it as ---+ the restructuring charge itself we'll treat as outside of Sigmund operating earnings ---+ that's what we typically do.
It is coming down about $40 million year-over-year.
I'm struggling to remember the chart you are talking about.
I suspect there is incremental spending largely on things like the C-Series and Globals.
Because both of those programs have been delayed.
I was thinking more like $140 million, but yes, but I do think the large ---+ the vast majority of the additional spend is related to those Bombardier programs.
That one is a very meaningful competition for us but not for 2016.
They are going to select multiple suppliers ---+ by the way the proposals have been submitted so they are in the source selection process right now.
They will select multiple suppliers.
Two or three is the indication that we have that somewhat is dependent on the compliance level of the proposals that go in.
But part of that program includes once you are selected, you provide prototype radios to the Army, and then they go through a test and evaluation program before they turn around and buy quantities of radios, so all the revenues will be outside of our FY16.
In terms of other big programs in Government Systems, we've got quite a few International C-130 update programs that should come to source selection here in the next six months, so that's a space to watch because we are anticipating some of that will drive growth for us in a second half.
And then we have just the significant quantity of smaller-level programs.
I will say it was nice to get both the R210 and the MIDS IDIQs in place so that we can get the annual buys bought against those.
And again those are ---+ R210s going to drive some growth for us as well as the datalink, the MIDS is a datalink.
That will drive some growth for us in 2016 as well.
We've got the base contract but we need to get the IDI ---+ or the annual buys done in place against those base contracts.
We are also seeing some uptick in GPS ---+ modernized GPS awards, and so that's another space to watch over the year because I'm anticipating some pretty good growth in that area as well.
We had good growth last year with some launch customers.
We're working a couple campaigns right now, nothing yet that I can announce but we are expecting to continue to also see growth in 2016 with that large-format display retrofit program.
No comment on the first program.
Obviously, the JTRS program which is ---+ we've got to bring pretty much a non-development item radio to the table so that's quite an investment.
And then we are continuing to always invest in next generation capability, particularly as we are bringing commercial flight decks into the military market.
So for example some of the rotary wing applications that I talked about, typically what we need to do is bring Fusion components but militarize those, and we will spend R&D doing that militarization work so that we can be competitive in bringing those commercial technologies into that military market.
Operator, we have time for one more question.
I would say X Bombardier we are talking about mid-single-digit growth for Commercial Systems on an organic basis.
As it relates to total Bombardier revenues, it is probably under 5% of the total ---+ our total revenue at this point.
Thank you, Sean.
We plan to file our form 10-K in about three weeks, so please review that document for additional disclosures.
Thank you for joining us today and participating on the conference call.
