Triumph Group, Inc. (NYSE:TGI) Q4 2018 Earnings Conference Call Transcript

May 10, 2018 • 08:30 am ET

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Triumph Group, Inc. (NYSE:TGI) Q4 2018 Earnings Conference Call Transcript

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Q & A
Executive
James F. McCabe Jr.

of a drag until we get into full production. And when we do with the revenue recognition in out years, not in FY19, but in the out years could have a positive impact on margins because that NRE that we otherwise would have amortized in as expense would be written off the retained earnings on the initial adoption.

So yeah, there will be a bit of a drag, but it's less of a drag than it was in the past as we continue to improve the program. And we'll talk about improving our mix -- improving backlog, we talk about improving mix and improving price.

Analyst
Michael Ciarmoli

Okay. But presumably if we were on the old accounting method, you'd still be building up a deferred pre-production inventory and that's all flowing through the P&L right now under the new. So is it fair to say it's going to be running at a negative operating income level?

Executive
James F. McCabe Jr.

So you're right that we now do expense some of those pre-production costs we otherwise would have capitalized, but they're not as significant as they were in the past and that's why I said it's not a material impact.

Operator
Operator

Since there are no further questions, this concludes Triumph Group's fourth quarter fiscal year 2018 earnings conference call. There is a replay of the conference that starts today at 11:30 AM Eastern Standard time until the 16 at 11:59 PM Eastern Standard time. You can access the replay by dialing 1-800-585-8367 and entering access code 4373459 or you can also access the replay by dialing 1-855-859-2056 and entering the same passcode.

You may all disconnect and have a wonderful day.