Good afternoon, ladies and gentlemen, and welcome to the AAR's Fiscal 2016 Fourth Quarter Earnings Call. We are joined today by David Storch, Chairman, President and Chief Executive Officer; Michael Sharp, Chief Financial Officer; Tim Romenesko, Vice Chairman and Chief Operating Officer of Expeditionary Services; and John Holmes, Chief Operating Officer of Aviation Services. Before we begin, I'd like to remind you that comments made during the call may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, as noted in our news releases and the Risk Factors section of the company's Form 10-K for the fiscal year ended May 31, 2015. In providing forward-looking statements, the company assumes no obligation to provide updates to reflect future circumstances or anticipated or unanticipated events. At this time, I'd like to turn the call over to AAR's Chairman, President and Chief Executive Officer, David Storch. Sir, please go ahead.

Thank you, ma’am, and good afternoon, and thanks to those who are joining us today to discuss our fourth quarter and fiscal year 2016 results. Overall, we had a good quarter and our business has performed in line with our expectations. Today, I will share some highlights on the results and then turn the call over to Mike who will provide some detail on the financials, and then we will open up to questions. First off on our Aviation Services segment, we saw sales increase of 11.2% or 40.2 million, so really good organic growth. Our distribution programs sub businesses delivered strong results. Growth was primarily driven by the ramp up of a few distribution lines as well as new government contracts including C-130 over in Afghanistan and C-40A support contracts. During the quarter, we announced several key wins that will expand our global presence going forward. We signed an agreement with UTC Aerospace Systems to distribute products to an Asian defense customer. That’s a multiyear contract. We’ve already made the investments. The revenues, though, won’t start until later in the fiscal year. We won a contract with fastjet, a leading low cost carrier in Africa to provide power-by-the-hour component inventory management and repair services for their fleet of A319 aircraft. We also won a similar contract with Volotea, a Spanish low cost carrier also operating the A319 series aircraft. Finally, subsequent to quarter end, we announced that we were awarded a multiyear contract or a series of multiyear contracts to provide rotable component and wheel, tire and brake services for CommutAir’s ERJ 145 fleet that we’ll be operating in support of United Airlines. This tip-to-tail support program simplifies the type of turnkey solutions we’re able to offer with our breadth of expertise and scale. Our trading businesses performed on a sequential basis and also when we compare it to the prior year. And our MRO operations experienced organic double-digit growth for the third consecutive quarter. This was principally driven by strong capacity utilization across our airplane and maintenance network where we sold over 1.4 million man hours in the quarter. We also saw higher volumes on our landing gear repair, component repair and engineering service business lines. Turning over to Expeditionary Services, we had a slight increase in sales, mostly driven by the launch of our Falkland Islands search and rescue program, which we kicked off in April. Our team did a great job setting up this operating and our execution has been flawless thus far. During the quarter we also secured a $21.7 million new contract win as well as an extension of an existing contract, each one covering operations in Afghanistan. But despite these positive developments, our airlift business continues to be challenged and we’re looking for ways to get better results from that business. Thank you for your attention. I’ll turn the call over to Mike.

Thanks, David. I will now discuss our fourth quarter financial performance in a bit more detail and start by saying that sales for the quarter were 458.2 million, up a strong 10.2% over the prior year. As David mentioned, Aviation Services sales increased 40.2 million or 11.2% year-over-year while Expeditionary Services segment sales reported a slight increase in sales. The gross profit margin in Aviation Services was 15.8%. As discussed in the past, margins in this segment will fluctuate based on mix of product and services sold and that is what we saw this period. In the Expeditionary Services segment, the gross profit margin was slightly positive at 1.9% and continues to reflect the softness in the markets we serve in this segment. SG&A expenses as a percent of sales were 10.1% and improved from 12.3% last year and 10.6% of sales in our third quarter. Again, overall, we feel good about our cost structure and the opportunity for improvement in this ratio will largely come from continuing to increase sales. Net interest expense was 1.1 million in the period compared to 7 million last year and reflects the significant decline in average outstanding borrowings compared with this time last year. Our effective income tax rate for the period was 34%. Turning to cash, we generated a strong $46 million of cash from operations in the fourth quarter. CapEx for the quarter was 14.2 million and depreciation and amortization, including the amortization of stock-based compensation, was 13.5 million. During the period we paid $2.6 million of dividends and repurchased approximately 61,000 shares in the open market for 1.4 million. As of May 31, a little under $83 million remains available under the Board authorized share repurchase plan. As a result of the strong cash flow from operations, net debt decreased $26 million from February 29 to end the year at $119 million. Our net debt to capital ratio remains a low 12%. During the fourth quarter, we retired the remaining 25.7 million of our convertible notes. The annual book interest savings associated with this retirement was approximately 1.4 million and we saw a full quarter's worth of savings in Q4. Thanks, and I’ll now turn the call back over to David.

Thanks, Mike. Overall, as I indicated earlier, fiscal year 2016 was a solid year for the company with strong organic sales growth in Aviation Services. We ended the year with an excellent financial position that gives us stability, flexibility and capacity to capitalize on market opportunities. We will continue to make investments in our industry-leading operations as we move into fiscal year '17, and I am excited about our future prospects. On that note, let me conclude my comments with our guidance for fiscal year '17. As stated in our earnings release, we currently expect sales in the range of 1.7 billion to 1.8 billion. We anticipate further growth in our Aviation Services segment and slight improvement in Expeditionary Services. Diluted earnings per share from continuing operations for the full year 2017 is expected to be in a range of $1.30 to $1.40, which at the midpoint represents an increase of 16.4% compared for the full year of fiscal year 2016. As you consider this guidance, note that we expect a feasibly low first quarter with results improving throughout the year. At the point, let me turn the call back to the operator for any questions you may have.

Thank you. [Operator Instructions]. Our first question comes from the line of Kevin Ciabattoni with KeyBanc. Your line is open. Please go ahead.

Hi. Good afternoon, guys.

Hi, Kevin.

Looking at corporate expense and I guess particularly the SG&A line, I know when you divested Telair, you had talked about seeing a 20% reduction in corporate expense as a target. Just wondering, maybe Mike, if you can talk a little bit about kind of where you are against that target, and is there still room to bring corporate down and maybe how you’re thinking about SG&A for next year?

So we communicated that target reduction, Kevin, last year and that was all largely realized sometime in the first quarter of this fiscal year. I think largely we’ve completed all those activities. There is always perhaps some room. But as I indicated, Kevin, we’re pretty comfortable with the cost structure not just at corporate but across the company not that we don’t analyze and continue to focus on it. But that ratio that we tend to talk about as a percent of sales we think it’s mostly going to improve as we go forward from increasing sales.

Okay. And then maybe on the – sticking to the margin theme and Expeditionary as we look at next year, margins have bounced around a little bit there over the past couple of years. We’ve seen a couple of quarters that were negative. How are we looking at Expeditionary margins for next year? Are you guys viewing that as being profitable through the whole year?

Yes, let me ask Tim to answer that question, Kevin.

Hi, Kevin. So we’re looking for improved margins off of fiscal 2016 base. You probably saw today that we were awarded a couple of new contract positions in Afghanistan for S-61 helicopters. We expect those to start contributing to our results late in this quarter and really have a full effect in the second quarter. So between that, the five-year program and some of the other things that we’re working on and we are expecting improved margins from fiscal '16 levels.

Okay. And Tim, while I have you, in terms of active positions right now I think based on what you said last quarter, if you hadn’t lost any, you should be at 22. Can you talk a little bit about where we are in airlift right now?

Yes, so we’re at 21 today. We picked up the two additional in Afghanistan and we ended the third quarter at 19.

Okay, perfect. And then last one from me and I’ll jump back in queue. Can you talk about what you’ve seen in the trading business over the past few months? I know it was getting a little bit tougher in terms of competition. Supply was tightening. Have you seen any shift in either direction in that business? And I know it’s a pretty high margin business for you guys historically. Is that creating any kind of margin headwinds on the Aviation Services side?

So Kevin, this is David once again. I don’t believe that the pressures have been around competition as much as the pressures have been around overall market demand. So this quarter was a pretty decent quarter for that business, improvement sequentially and improvement year-on-year; correct and that the levels are not where we may have been historically and correct that we’ve been fairly profitable in this business. So we remain cautiously optimistic that as we move along into the new fiscal year, these businesses will perform well and have a positive impact on year-over-year margin results.

Great. Thanks, guys.

Thank you. [Operator Instructions].

There may be a problem with people getting questions in, because I know there were a couple of people who expressed interest in getting questions but we don’t see their names on your list.

[Operator Instructions]. I have a follow up from Kevin Ciabattoni with KeyBanc. Your line is open. Please go ahead.

I’ll jump back in since mine’s working. On that KC-10 contract I know you guys have lost out as a prime bidder. Is there any chance going forward that you could get pulled back in as a sub to L-3 on that or are you aware that they’re planning on going that alone?

I think we’re best off probably not commenting on that. We don’t see that necessarily as a possibility but probably best not to comment.

Okay. And then on the INL contract that you guys are bidding on, the Department of State put out an additional one year extension for the incumbent. Can you just talk a little bit about – obviously it’s frustrating for you guys I’m sure. Can you talk a little bit about what that extension does or doesn’t do in terms of allowing the Department of State to announce a winner for the full competition? Does that prevent them from doing that until that extension’s up or could they do that at any point in the interim?

We’re not aware of any impact on their decision-making process. We’re aware of the extension. But again I think probably best off not to comment.

Okay. Thanks, David.

Yes.

Thank you. [Operator Instructions]. I’m showing no further questions at this time. I’m sorry, Mr. Greg Dean with Worden Capital, your line is open. Please go ahead.

How’s it going guys?

Good.

Good. This might be a foolish question but I just decided to ask. With current cabinet in office, are there any expectations or concerns with change in cabinet potentially going democrat to republican in the next handful of months?

No difference on our business.

Okay. Thank you.

We want the best people to serve.

Got you. Thank you.

Thank you. [Operator Instructions]. Our next question comes from the line of Tom Lewis with High Road Value [ph]. Your line is open. Please go ahead.

Hi. Thanks. Just one and maybe this came up on the last conference call but can you give us any kind of update as far as winding down the manufacturing operations that you discontinued a year or so ago? Are they still on board or are we still in a disposition there?

Obviously, we’ve sold the cargo business. That was a very successful transaction. We have successfully wound down the metals business and the composites business is still in our discontinued portfolio.

Okay, that’s it. Thanks.

Thanks, Tom.

Thank you. I’m showing no further questions at this time. I’d like to turn the conference back over to management. I’m sorry, I am now seeing one other question from the line of Bill Jacobs with Jacobs Investment. Your line is open. Please go ahead.

Thanks. I’m just looking at – it looks like the implied margins for fiscal '17 are something like 4.5% as you look at it on an EBIT basis and I think the market was looking for something closer to 6%. What do you see long term where you can get margins overall? Are we – I guess a lot of it depends on what happens with Expeditionary, but I guess what the market’s disappointed about is that we are expecting the margin improvement and don’t seem to be getting much.

We’re getting margin improvement in our core Aviation Service businesses and we’ve expressed certain disappointments around airlift. We also are waiting on certain contracts and we’d be disappointed if our margins don’t get closer to the area you indicated.

So you think on a longer-term basis – maybe not in longer term, more intermediate term looking out two or three years, we can get sort of a 6%, 7% EBIT margins?

I think better than that.

Better than that?

Yes.

Okay. And then on Expeditionary, how long do you give it? At what point do you say, this is what the new world looks like and the money that we made in Afghanistan for those years has gone and it’s never going to be the business that it was. That was the aberration, not the current period and how long do you give it before you have to make a decision about whether this business fits – and the Aviation Services business is doing so well, how long do you give the other side of the shop?

First off, think of it as two different businesses. One business more tied to say recent activities in Afghanistan, one business that’s tied to true preparation, troop movements, et cetera, all over the world for the United States government. So the lineation would be – the distinction would be between our mobility business and our airlift business. In terms of – and if you look, the mobility business has been part of AAR since 1981 and has had in the past times of good performance and weaker performance based on the particular cycle surrounding those types of product and services. If you look at the airlift business, it’s a recent business to the company. To your point, it did very well in the Afghanistan build up. We’re looking closely at that business for ways to extract value and we will do the best we can. And if we get to the point where we can no longer extract the right value, we will take other actions.

Okay. Is a sale possible or do you think – I know that’s not what you’re looking at right now but if you think about that business and you say, okay, this isn’t working. Is there a logical buyer for these assets?

I don’t think that I’d look at it necessarily that way as much as – so we have some very meaningful contracts today. I think you heard earlier in the call we have 21 aircraft that we’re operating. Part of the challenge is the aircraft we have that are not operating. Some of the aircraft we do have up for sale and we do have interested parties in buying those assets. So it may very well be that the asset base gets compressed and also we take advantage of our knowledge, if you will, in serving helicopters to expand our services beyond just operating these aircraft.

All right, thank you.

Okay, thank you.

Thank you. I’m showing no further questions at this time.

Okay. Thank you very much for your participation today.