ATS ATS Corporation

NYSE
$20.31

ATS Corporation Q1 F2027 Earnings Call Transcript

Thursday, August 6, 2026

AI Conference Call Analysis

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Justin
Analyst
Good morning. Thanks for taking my call. On the radiopharmaceutical strength mentioned, are we able to have some context as far as the sub-segment percentage of sales, the book-to-bill, and how you see that segment going forward?
Doug Wright
Chairman and Chief Executive Officer
So I would say, first of all, it is the... Thank you. The science behind this is really exciting for our team. I mean, we're basically part of a new generation of oncology therapies and it's a Aside from the human element of these exciting new therapies, from a business perspective, these are very, very complex manufacturing environments with a lot of safety and you're dealing with radiological materials. and these sites that our customers are building and that we're partnering with them are very substantial opportunities for ATS. We mentioned one partnership in our text today. There's several, there's a whole ecosystem of investment going into this market that we are uniquely positioned to support and these are material. I mean, they're The size of these facilities would be a triple digit opportunity addressable market for a company like ATS.
Justin
Analyst
Yeah, thank you. So just on triple digit addressable market, sorry, are you able to just clarify that a bit?
Doug Wright
Chairman and Chief Executive Officer
Well, what I'm saying is these isotope facilities that you've probably read about in the news, They are fairly large sites and they require a lot of ATS equipment, ATS category of equipment. And for a company like ATS, the addressable market per site would be in that zip code.
Justin
Analyst
Okay, thank you. And just circling back on the operating margin target of I'm not sure if I missed this, but is it fair to assume that the base level today is 10% suggestive of 500 BEEPS margin expansion goal?
Unknown Speaker
Chief Financial Officer
Well, I mean, last year we were around 10.6%. So our long-term goal The stated margin EBIT target is 15%. And as Doug said today, we believe that as we continue to transform and grow the operations and business participating in these high growth markets, that we have the opportunity to operate above that. But right now, we're targeting getting to that 15%.
Doug Wright
Chairman and Chief Executive Officer
Yeah, so Justin, just in terms of the cost transformation program, just to help you with your modeling, consider it to be around a 250 basis point potential over time. So 500 is a pretty good estimate, as you've already stated and confirmed. And about when we say half, that's kind of the way we would model it from the balance would be. and other other items including the substantial growth we're having in our services business which is accretive as well as other ABM level improvements so but half from fixed cost half from other within that other would be mixed toward aftermarket which would be reasonably material as well as the other pieces and as you A number of you have asked us before sort of help bridge the margin expansion deliverable. We're trying to be a little more fulsome here and giving you the little bit of the chunks of the math to help you understand the quantum that we're targeting.
Justin
Analyst
Very helpful. Thank you for taking my questions. You're welcome.
Operator
Conference Operator
There are no further questions on the line. I will now turn the call back over to Doug Wright for the closing remarks.
Doug Wright
Chairman and Chief Executive Officer
Thank you, operator, and thank you everyone for joining us today. We look forward to welcoming shareholders at our annual meeting later today and speaking with all of you again in our Q2 call in November. Have a good day.
Operator
Conference Operator
Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.