Welcome to the CPI Aero's 2015 Second Quarter Results Conference Call. With us today are Douglas McCrosson, President and Chief Executive Officer; and Vincent Palazzolo, Chief Financial Officer. After management’s prepared remarks, there will be a Q&A session. As a reminder, this conference call will contain forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from projected results. Included in these risks are the government's ability to terminate their contracts with the company at any time; the government's ability to reduce or modify its contract if its requirements or budgetary constraints change; the government's right to suspend or bar the company from doing business with them, as well as competition in the bidding process for both government and subcontracting contracts. Subcontracting customers also have the ability to terminate their contracts with the company if it fails to meet the requirements of those contracts or if the customer reduces or modifies its contracts to them due to budgetary constraints. Given these uncertainties, listeners are cautioned not to place undue reliance on any forward-looking statements contained in this conference call. Additional information concerning these and other risks can be found in the filings with the Securities and Exchange Commission. Please note today’s conference is being recorded. Now, I will transfer the call to Douglas McCrosson, CPI Aero's President and Chief Executive Officer.

Thank you, Amy. Good morning and thank you to all for joining us for our 2015 second quarter and first half results conference call. I will start this call by providing a summary of our achievements for the periods and then turn the call over to Vince, who will discuss our recent financial results. Yesterday after the close of the market, we released our second quarter and first half 2015 financial results. Before I turn the call over to Vince, I would like to point out the following items. First for the second quarter of 2015 we reported EPS of $0.12 compared to a loss of $3.50 per diluted share in the second quarter of ’14. As compared to the first quarter of ’15 we reported improvements in both revenue and net income in the second quarter of 2015. We expect these sequential quarter improvements to continue over the next two quarters. Our performance for the second half of the year is expected to be much stronger than the first half due to the timing of delivery orders associated with several major programs received in late 2014 to early 2015. For this reason, we are projecting full year revenue $92 million to $102 million, surpassing the $89.3 million of revenue we recorded in 2012. Second, we continue to focus our efforts on improving our production margin and have taken steps to drive direct and indirect costs down. Our gross margin for the first half of 2015 was affected by the profit adjustment we made last year related to revised estimates for the A-10 Wing Replacement Program or WRP. As a result, we continued to record revenue on this program with zero gross margin. Excluding the effect of the A-10 WRP first half 2015 gross margin in all remaining programs improved…

Thank you, Doug. Starting with our financial performance for the second quarter and first half of 2015 as shown on Slide 6, for the second quarter of 2015 as compared to the second quarter of 2014, we reported revenue of $21.9 million compared to negative $23.8 million. Gross profit $3.9 million compared to negative $43 million. Pre-tax income of $1.5 million compared to a pre-tax loss of $44.9 million and net income of approximately $1 million or $0.12 per diluted share, compared to a net loss of $29.7 million or $3.50 per diluted share. Comparing the first half of 2015 versus the first half of 2014, we recorded revenue of $41.8 million compared to negative revenue of $1.9 million. Gross profit of $7.5 million compared to negative margin of $38.5 million. Pre-tax income of $2.9 million compared to a pre-tax loss of $42.4 million and net income of $1.9 million or $0.22 per diluted share, compared to a net loss of $28 million or $3.31 per diluted share. Moving to Slide 7, in the first half of 2015, approximately 47% of our total revenue or $19.8 million was generated from commercial programs mainly from our Gulfstream, Embraer and Honda programs. Defense programs generated approximately $22 million during the first half of the year of which $21.7 million was from tier one military subcontracts with OEMs and $300,000 was from government prime contracts. As shown on Slide 8, our gross margin for the first half of 2015 was affected by the change in estimate for the A-10 Wing Replacement Program as we continue to record revenue on this program with zero gross margin. Excluding the effect of the A-10 Wing Replacement Program, first half 2015 gross margin on all remaining programs improved to 23.4% compared to 20.3% in the same period…

Thank you, Vince. Since the beginning of the year through June 30, 2015 we received approximately $24.2 million of new contract awards, which included approximately $6.4 million of government prime contract awards, $6.1 million of government subcontract awards and approximately $11.7 million of commercial subcontract awards. This compares to a total of $19.2 million of new contract awards from all types in the same period of last year. As Slide 16 shows, at June 30, 2015, our total backlog increased to a record $446.6 million as compared to $403.7 million at December 31, 2014. Funded backlog was increased to $130.6 million, up $10 million as compared to funded backlog at December 31, 2014. Unfunded backlog comprised 71% of total backlog and increased to $316 million with 40% related to our long-term commercial aerospace programs. Moving to Slide 17, this shows our largest contracts currently in progress including our recently won contracts, which collectively have the potential to generate revenue of $447 million during the remainder of their performance periods. Slide 18 provides an update of a few of our programs currently in progress. Starting with our Phenom 300 engine inlet assembly program with Embraer we have successfully ramped production from two ship sets per month to more than 12 ship sets. We plan to ramp up production to 14 ship sets per month by year-end. HondaJet one of the newest and most technologically advanced light jets on the market is another important program for CPI. In late March of this year, Honda Aircraft received FAA provisional type certification for its business jet and it is expecting to receive its final type of certification in the new few months. Honda has publicly stated that it has booked orders for more than 100 aircraft and that they expect to deliver at least…

[Operator Instructions] Our first question is from Mark Jordan and Noble Financial.

Good morning gentlemen. A question relative to how the A-10 program winds down, when are the final shipments scheduled, and I believe that you had stated last year that in your business plan you had a base case of about 3 million in A-10 revenue, is that still the case?

Mark, the delivery schedule will run at least until the middle of next year, perhaps even into the latter half of next year, the amount of ship sets that we are delivering on a monthly basis. As for the revenue, the original comment that we had made about the 3 million to 4 million [worth of] revenue from last year was based upon the assumption that the program would get terminated and we would stop working on it on September of this year. Well, obviously we are at August 6 of this year and we haven’t been terminated yet. So we are going to have to continue to book revenue beyond where we currently – where we currently are. We still have about $5 million to $6 million worth of revenue to run on that program through the end of the cycle, which they say is going to run at least until mid next year, maybe until the latter half of next year.

Okay. That ties in to a question of, your balance sheet line of cost and estimated earnings in excess of billings being about $90 million, how much of that relates to the A-10 and I would assume under the scenario you just outlined of deliveries running through midyear to the fall of 2016 that those would be converted – that would be converted to cash over time. But what exposure there is that – of that 90 million is A-10 that should eventually be converted to cash?

It is about 12% of that number, yes, about 12% of that number is the A-10.

Okay.

It is of course offset. There is also a $1.7 million liability on the liability side of the contract, loss liability. That is also A-10. So the net number might be closer to around $9 million net.

Okay. Given that line down that you have and that [Indiscernible] generating cash as it comes to completion, should the company therefore be meaningfully cash flow positive from operations in 2016?

Mark we haven’t done the forecast for 2016, but whatever gain we make on that side we lose on building up inventory on our recent wins, particularly the F-16 and T-38. so when we provide our guidance on 2016, we will provide some cash flow guidance as well, but yes, if there weren’t those $200 million of new orders that we put into the backlog starting about seven or eight months ago.

Okay, final question from me obviously you outlined a rich bid pipeline and the fact that you have no incremental awards in your outlook for this year, while there is nothing in your outlook do you expect meaningful decisions on some of the bids that are out there between now and the end of the year?

Yes. There is one military. I’m not talking about some of the smaller ones, but there is a military one that we expect our customer is going to make a decision on during the third quarter, this current quarter, and there is one larger commercial that we expect not a final decision, but a downselect decision probably during the early fourth quarter. I’m not sure if the downselect process will result in a final decision in 2015, but we will know in the fourth quarter if we are part of the two companies that get downselected.

Okay, thank you very much.

Thank you Mark.

[Operator Instructions] Our next question is from Mike Crawford of B. Riley & Company.

Thank you. going back to the A-10, is there – what is the likelihood that the government might have to go back to Boeing, Boeing might have to come back to you to actually order additional wings, which then would put you in a position of actually making margin on some of this production.

I hate to handicap this because I have already been wrong once on this. But I would have thought that the Congress would have already stopped it. That said, there is money for the A-10 to continue flying. What is uncertain still is whether or not that necessarily means the government will continue with the wing program and I feel that there is still some possibility that we will be asked to stop or at least drastically slow down that program within the next several months as the situation in Washington kind of unfolds. That said I find that scenario may be more likely than the scenario that gets us to beyond the current amount on order, which is 173 aircraft. So in order of likelihood, I would say we have likely – it is more likely that the program gets scaled back and or terminated and then the second most likelihood would be we run it to the 173, and the least likely is that they do more and order more.

Okay. Thank you and then on another defense program you have been long-running prior to UTC Aerospace Systems, and on the DB-110 sensor and now the company – that company is looking to get a smaller pod to accomplish what that product does, now is that something that you would be capable of working on with them or will it be more of a build-to-print situation, how closely would you work with a customer like that on?

We are working actually very closely with United Technologies’ Aerospace Systems at the earliest stages of their design and development. We are not under contract I should say for any derivative pods of the DB-110, but our relationship is such that we are part of the process at least on a informal basis providing some producibility tips and some kind of ROM estimates of what this structure may cost. So our relationship is excellent with UTAS. We are looking to extend our current DB-110 contract with a multi-year agreement, which is an ongoing discussion we are having with the customer and that agreement would also lend itself to derivative pods and entirely new pods as well.

Okay, but that is separate from this other military pod form you are expecting..?

I’m not sure exactly what you want, you are referring to [Indiscernible], then we are intimately involved. If you are referring to one that I’m not aware of I can’t answer that.

Okay. Thank you.

Thank you Mike.

[Operator Instructions] Seeing no further questions, this concludes our question-and-answer session and I would like to turn the conference back over to Doug McCrosson for closing remarks.

Thank you, and thank you to all of you for participating in this call. We look forward to speaking to you again in early November when we announce our 2015 third quarter results. Thank you. Goodbye.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.