올버니 인터내셔널(AIN) 2026년 3분기 실적 콘퍼런스 콜: 사상 최대 매출 및 복합소재 성장

핵심 요약

• 올바니 인터내셔널(Albany International)은 엔지니어드 복합재(Engineered Composites) 프로그램의 생산 확대와 재협상된 CH-53K 계약에 따른 약 1,200만 달러의 이익에 힘입어 분기 매출이 전년 동기 대비 34% 증가한 3억 4,950만 달러로 역대 최고치를 기록했다고 발표했습니다.
• 조정 EBITDA는 약 4,400만 달러 규모의 CH-53K 예상 손실 환입을 포함해 1억 10만 달러를 기록하며 매출의 28.6%를 차지했습니다. 조정 희석 EPS는 1.68달러였습니다.
• 엔지니어드 복합재 매출은 1억 7,970만 달러로 역대 최고치를 달성했습니다. 경영진은 CH-53K 관련 조정 및 기타 일회성 항목을 제외한 해당 사업 부문의 기저 조정 EBITDA 마진율을 약 12.5%로 추정했습니다.
• 머신 클로징(Machine Clothing) 부문은 1억 6,980만 달러의 매출과 4,630만 달러의 조정 EBITDA를 기록했으며, 마진율은 약 27%였습니다. 유럽과 중국의 안정적인 수요는 미주 지역의 부진으로 상쇄되었습니다.
• 경영진은 2026년 4분기 연결 매출 가이던스를 3억 2,500만 달러에서 3억 3,500만 달러로, 조정 희석 EPS 가이던스를 0.65달러에서 0.75달러로 유지했습니다.
• 경영진은 미사일 및 극초음속 분야의 기회가 2027년부터 기여하기 시작하여, 프로그램과 생산 능력이 본격적으로 확대되는 2028년에는 더욱 의미 있는 실적 기여를 할 것으로 전망하고 있습니다.

주요 재무 결과

사업 및 영업 실적

엔지니어드 복합재

엔지니어드 복합재 매출은 분기 역대 최고치인 1억 7,970만 달러로 증가했습니다. 이러한 성장은 LEAP, 보잉 787 및 일체형 프레임 플랫폼, CH-53K, 미사일 프로그램, 엔진 응용 분야 등 전반에서 폭넓게 나타났습니다. 또한 주요 방산 업체와의 차세대 계약을 위한 공구 제작 물량이 조기 집행되면서 매출에 긍정적인 영향을 미쳤습니다.

공시된 조정 EBITDA는 전년 동기의 1억 3,460만 달러 손실 대비 크게 개선된 6,560만 달러(매출의 36.5%)를 기록했습니다. 2026년 3분기 실적에는 CH-53K 계약 재협상에 따른 약 4,400만 달러가 포함되어 있습니다. 경영진은 확인된 조정 사항 및 일회성 항목을 제외한 기저 마진율을 약 12.5%로 추정했습니다.

CH-53K 수정 계약은 매출에 약 1,200만 달러 기여했으며, 해당 프로그램의 장기적인 수익성을 개선했습니다. 경영진은 이번 합의로 프로그램 관련 불확실성이 줄어들고 솔트레이크시티 제조 시설의 운영 기반이 한층 더 안정화되었고 밝혔습니다.

또한 올바니는 세라믹 기질 복합재(CMC) 역량을 확장하기 위해 2,120만 달러 규모의 산업기반 분석 및 지속(IBAS) 지원금을 수령했습니다. 이 자금은 자체 가공, 품질 검사, 고밀도화 생산 능력을 확충하는 데 사용될 예정입니다. 회사는 추가 생산 능력이 필요할 때 자체 투자를 최소화하고 고객사나 정부 자금을 결합할 계획입니다.

머신 클로징

머신 클로징 매출은 전년 동기 대비 소폭 감소한 1억 6,980만 달러를 기록했으며, 조정 EBITDA는 4,630만 달러, 마진율은 약 27%였습니다.

유럽 시장은 안정세를 유지했으며, 중국은 4분기 연속 안정세를 기록했으나 경영진은 가시성이 여전히 제한적이라고 덧붙였습니다. 북미 지역 주문율은 개선되었으나, 고객사 통합 및 설비 합리화가 판매량에 지속적인 부담으로 작용했습니다. 남미 시장 수요는 약세를 유지했습니다.

아시아를 중심으로 티슈 및 포장재 수요가 호조를 보였습니다. 그러나 이러한 긍정적 흐름은 인쇄용지 등 출판용 지류의 장기적 수요 감소와 남미 지역의 수요 약세로 인해 부분적으로 상쇄되었습니다.

경영진은 연말까지 지연된 머신 클로징 판매량을 회복할 수 있을 것으로 예상하고 있습니다. 기존 설비는 계속 작동 중이며, 교체용 신규 설비는 조립 진행 중으로 2026년 말까지 가동될 것으로 예상됩니다.

경영진 가이던스

2026년 4분기에 대해 올바니 인터내셔널은 다음과 같은 전망을 유지했습니다.

• 연결 매출 3억 2,500만 달러~3억 3,500만 달러
• 조정 희석 EPS 0.65달러~0.75달러
• 실효 세율 약 29.5%

경영진은 지역별 수요 불균형, 고객사 통합, 제지 산업의 설비 합리화 여파로 머신 클로징의 연간 매출이 2025년 수준을 소폭 하회할 것으로 지속 전망하고 있습니다.

엔지니어드 복합재 부문은 상업용 항공우주 및 방산 프로그램의 생산 확대에 힘입어 전년 동기 대비 성장을 이어갈 것으로 예상됩니다. 경영진은 12.5%의 기저 조정 EBITDA 마진율이 2026년 4분기 및 2027년 초에 적절한 기준점이며, 이후 점진적으로 개선될 것이라고 설명했습니다. 회사의 목표는 2027년 말 해당 부문의 마진율을 10%대 중반으로 끌어올리며 마무리하는 것입니다.

경영진은 CH-53K 계약 수정 사항이 적용되고 신규 계약이 포트폴리오에 반영됨에 따라 2027년 하반기부터 추가적인 마진 확장이 이루어질 것으로 예상하고 있습니다.

리스크 및 주요 관전 포인트

• 머신 클로징 수요는 지역별로 차이를 보이고 있으며, 중국의 가시성은 여전히 제한적이고 남미 시장은 약세가 이어지고 있습니다.
• 제지 업계의 고객사 통합 및 설비 합리화로 인해 미주 일부 지역의 물량이 감소했습니다.
• 출판용 지류는 장기적인 구조적 감소세에 계속 직면해 있습니다.
• 엔지니어드 복합재 부문의 성장은 주요 항공우주, 방산 및 미사일 프로그램 전반의 지속적인 생산 확대에 달려 있습니다.
• 미사일 적격성 평가 및 생산 일정에는 여전히 불확실성이 존재합니다. 경영진은 일반적인 생산 확대에 12~36개월이 소요될 수 있지만, 현재 진행 중인 프로그램은 이보다 더 빠르게 진행될 수도 있다고 언급했습니다.
• 공시된 3분기 수익성에는 CH-53K 관련 주요 혜택 및 기타 일회성 항목이 크게 포함되어 있으므로, 엔지니어드 복합재의 기저 마진율이 모니터링해야 할 핵심 지표입니다.

애널리스트 Q&A 주요 내용

경영진은 CH-53K 관련 영향 및 기타 명시된 항목을 제외한 3분기 엔지니어드 복합재의 기저 조정 EBITDA 마진율이 약 12.5%였다고 말했습니다. 회사는 가격 개선, 생산량 증가, 손실 계약의 재협상 또는 종료에 힘입어 해당 수준이 2026년 4분기 및 2027년 초의 타당한 출발점이 될 것으로 보고 있습니다.

미사일 프로그램과 관련해 경영진은 JASSM과 LRASM을 기존의 성장 동력으로 꼽았습니다. 추가적인 기회를 통한 개발 활동은 2027년부터 실적에 영향을 미치기 시작하여 2028년에는 생산 기여도가 더욱 명확해질 것으로 전망됩니다.

경영진은 4분기 현금흐름이 견조세를 유지하며 3분기 수준에 근접할 것으로 전망하는 한편, CH-53K 계약 재협상에 따른 현금 유입 혜택이 2026년 4분기와 2027년 전체에 걸쳐 한층 더 가시화될 것이라고 덧붙였습니다.

자본 배분은 규율 있게 유지될 것입니다. 회사는 주요 기존 유산(legacy) 이슈가 해결된 만큼, 엔지니어드 복합재의 자체 성장에 우선순위를 두고 배당금을 유지하며 인수합병(M&A) 가능성을 더욱 진지하게 검토할 계획입니다.

실적 발표 전화회의 전문

전체 실적 발표 컨퍼런스 콜 녹취록

경영진 발표

Operator

Hello, everyone. Thank you for joining us, and welcome to the Albany International Third Quarter 2026 Earnings. [Operator Instructions]

I will now hand the conference call over to Karen Blomquist, Director of Investor Relations. Karen, please go ahead.

Karen Blomquist

Welcome to Albany International's Third Quarter 2026 Earnings Conference Call.

As a reminder, for those listening on the call, please refer to our press release issued last night, detailing our quarterly financial results. Contained in the text of the release is a notice regarding our forward-looking statements and the use of certain non-GAAP financial measures and their reconciliation to GAAP. For the purposes of this conference call, those same statements apply to our verbal remarks this morning. Additionally, our remarks today may reference our earnings presentation, which is available on the Investor Relations section of our website, albint.com.

Today, we will make statements that are forward-looking and contain a number of risks and uncertainties, which could cause actual results to differ from those expressed or implied. For a full discussion of these risks and uncertainties, please refer to both our earnings release of October 28, 2026, as well as our SEC filings, including our 10-Q and our 10-K.

Now I will turn the call over to Gunnar Kleveland, our President and CEO, who will provide opening remarks. Gunnar?

Gunnar Kleveland

Thank you, Karen. Good morning, everyone, and thank you for joining our third quarterly earnings call. The past 3 months have been pivotal in our evolution into a more focused and disciplined company, built around our proprietary 3D weaving and material science capabilities and the differentiated value they create across the diverse set of end markets we serve.

Also, as we previously disclosed, we completed our Strategic Review during the quarter. Through that process, we addressed the most significant legacy issue in our portfolio and reached an agreement with Sikorsky that improves the economics of the CH-53K program and provides a more stable foundation for the Salt Lake City manufacturing site and our business going forward.

I'm incredibly proud of the team at our Salt Lake City facility and the broader Engineered Composites organization. Through a period of uncertainty for the team, they stay focused on what Albany does best: delivering high-quality products, supporting our customers and executing with discipline. Our improved performance at the Amelia Earhart Drive facility and the engagement and relationship with Sikorsky were essential to this successful conclusion. We are very pleased to put this behind us.

Since concluding the review, our focus is shifting decisively from addressing legacy challenges to building for growth. We're seeing stronger execution, improved program visibility and a growing pipeline of opportunities across commercial aerospace, defense, missiles, hypersonics and next-generation aircraft applications. We're also continuing to engage with customers and government partners, evidenced by new wins in the quarter as well as the Industrial Base Analysis and Sustainment, or IBAS, award of $21.2 million to complement our investments in ceramic matrix composites. We will now have a fully vertically integrated facility that can serve all high-temperature needs faster and at a lower cost than our competition. This is exemplified through the teaming agreement with Lockheed Martin on hypersonic missile development.

At the same time, Machine Clothing continues to focus on its market and product leadership positions, emerging from the past several years of integration activities with a more optimized and resilient global business. Our integration and footprint actions position the segment to generate strong cash flow while supporting customers across paper, tissue, packaging and other industrial applications.

Taken together, we are entering this next phase as a stronger company with an optimized portfolio, reduced risk profile and a sharper focus on the areas where our core capabilities create long-term customer value.

Turning to results for the quarter. We generated consolidated revenue up 34% to $349.5 million, a record high quarterly revenue for the company. These strong sales were primarily driven by continued strength in Engineered Composites and production rate increases across several key aerospace and defense programs, plus a benefit of approximately $12 million related to the renegotiated CH-53K contract. We also delivered adjusted EBITDA of $100.1 million and adjusted diluted EPS of $1.68, above the high end of the revised outlook range we provided at the conclusion of the Strategic Review.

Our major programs are continuing to ramp. Our execution continues to improve. The portfolio contains materially less program risk, and we are winning new business. This is translating to stronger, healthier and more reliable growth.

Next, I'd like to discuss our results by segment, beginning with Machine Clothing. Machine Clothing revenue was $169.8 million, modestly below the prior year due to anticipated weakness in the Americas during the quarter related to customer consolidations. By region, China remained stable for the fourth consecutive quarter, although visibility remains limited. In the Americas, end market conditions and order rates materially improved in North America, while South America continued to see softer demand similar to the second quarter. In Europe, conditions remain favorable, although our quarterly volume was muted as a result of summer shutdown schedules in the region.

By grade, tissue and packaging demand remains favorable, particularly in Asia due to the stabilization of demand compared to prior year. These areas of strength are partially offset by the long-term secular decline in publication grades and softer demand in South America. The segment delivered adjusted EBITDA of $46.3 million and an EBITDA margin of approximately 27%.

Turning to Engineered Composites, the segment delivered another record quarter with revenue of $179.7 million. Growth was driven by higher production rates across multiple programs, including LEAP, Boeing platforms, CH-53K and missile programs. As has been the case throughout 2026, we're seeing stronger and more consistent EBITDA margins as we work to optimize our portfolio and improve efficiency. Looking forward, we expect additional margin expansion beginning in the second half of 2027 as contract modifications on the CH-53K begin having an impact, and we add new contracts to the portfolio.

Demand across our core commercial aerospace and defense programs remain strong, and we continue to see production rates build across multiple platforms. In defense, we continue to engage in constructive dialogue with the Department of War to support the rebuilding of the U.S. missile supply chain and provide innovative solutions that address critical defense needs with faster production rates and lighter weight solutions. Beyond defense, we're continuing to expand the application of our technology across next generation of commercial platforms. Our inclusion in the Wing of Tomorrow program demonstrates the potential for Albany 3D Woven, braiding, automation and resin transfer molding solutions to support meaningful advances to lighter weight, more durable and more efficient composite aerostructures for future aircraft.

Taken together, Engineered Composites is entering its next phase from a much stronger position. We are executing at a higher production rate, have expanded our pipeline of new opportunities and increased our focus on higher-value applications where our technology can deliver industry-leading solutions.

As we stand here today, we reflect about how, with more than 130 years of material science expertise and innovation, we are now beginning to accelerate the potential of our technology. We continue to evolve and find new ways to provide solutions using our technologies, and we look forward to sharing more about the advances and new applications for our technology at our upcoming Investor Day in New York City in December, where we will update you on our outlook for 2030 and beyond.

With that, I will turn the call over to Sean Valashinas, our acting CFO, to review the financial results in more detail.

Sean Valashinas

Thank you, Gunnar, and good morning. Before turning to the financials, I would like to remind you that a reconciliation of GAAP to non-GAAP measures discussed today can be found in last night's press release.

Third quarter revenue was $349.5 million, representing growth of 34% year-over-year. This increase was driven primarily by higher activity levels in Engineered Composites as key programs continue to ramp, moderated by a modest decline in Machine Clothing. Adjusted EBITDA for the quarter was $100.1 million or 28.6% of sales, which benefited from approximately $44 million reversal of the reach-forward loss. We also benefited in the quarter from a tariff refund and other discrete items. This compared to a loss in the prior year of $91.1 million, which included a $147.3 million charge related to the CH-53K program.

By segment and beginning with Machine Clothing, revenue of $170 million was at the high end of our expectations. We saw continued stability in Europe, signs of stabilization in China and softness in North and South America. As previously mentioned in the Americas, customer consolidation and capacity rationalization actions taken by papermakers over the past year have reduced volume levels in certain markets. Nonetheless, we maintain our strong market share in the Americas. Adjusted EBITDA for the segment was $46.3 million with a margin of 27.2%. The Machine Clothing business continues to deliver strong margins, reflecting disciplined cost management, operational execution and the ongoing benefits from integration and efficiency initiatives. Compared to the prior year, margins contracted slightly as a result of unfavorable regional mix and lower overall volume.

In Engineered Composites, segment revenue was $179.7 million, which marked a quarterly record for the segment. Performance was strong against all of our major programs and was above our estimates due to the pull forward of tooling in the quarter for a next-generation contract with a defense prime. Segment growth year-over-year was widespread across programs, including higher volume of LEAP, Boeing 787 and missile programs. Adjusted EBITDA for the segment was $65.6 million or 36.5% of sales compared to a loss of $134.6 million in the prior year.

As a reminder, in the third quarter of 2025, the initiation of the Strategic Review on the CH-53K program reduced revenue by approximately $46 million and operating profit by approximately $147 million as we recorded charges associated with the program's loss position. Over the past year, we have continued to execute on the program and have substantially consumed that loss reserve through production activity.

The renegotiation of the CH-53K program reached during the third quarter of 2026 resulted in a positive impact of approximately $12 million to revenue and $44 million to adjusted EBITDA. The timing of that benefit relates to the structure of the settlement. Importantly, the settlement removes uncertainty, improves the long-term economics of the program and further validates the progress our team has made in transforming Engineered Composites from a business focused on resolving legacy challenges into one positioned to create value through operational execution and profitable growth.

Gross profit for the quarter was $140.4 million with a margin of 40.2% compared to a loss of $49.9 million in the prior year. Gross profit benefited in the quarter by $33.4 million related to the renegotiated CH-53K contract. The improvement in gross margin year-over-year reflects adjustments of the amended CH-53K contract and stronger margins in Engineered Composites. Operating income was $59.4 million, representing a margin of 17% compared to a loss of $116.5 million last year. The improvement was driven by the CH-53K contract amendment.

Interest expense decreased to $5.3 million compared to $5.9 million last year as we paid down debt and focused on reducing leverage. Other income was a net benefit of $1.7 million compared to a net benefit of $347,000 in the prior year due to foreign currency translation impacts. The effective tax rate for the quarter was 24.9% compared to 20% in the prior year.

Free cash flow was a net gain of $36.5 million compared to a net gain of $25.7 million in the prior period. The year-over-year increase was driven by a number of items, including benefits from the renegotiated contract, tariff refunds and a vendor credit.

Capital expenditures for the quarter totaled $12.2 million compared to $18.3 million in the prior year as our focus on facility optimization lowered expenditures. R&D expense was $12.2 million, reflecting our continued focus on innovation.

We ended the quarter with $79.1 million in cash and $422.1 million in total debt, resulting in net debt of approximately $343 million as the company's improved cash position allowed for debt repayment while improving overall liquidity. Including revolver availability, we have approximately $457 million of available capital, providing flexibility to support ongoing investments and return capital to shareholders.

Turning to our outlook and beginning with Machine Clothing, the demand environment remains fluid and mixed by geography. We continue to see stable demand in Europe, signs of stabilization in China at current levels and softer demand in North and South America. Given these trends and the impact of customer consolidation and capacity rationalization across parts of the paper industry, we continue to expect full year Machine Clothing revenue to be slightly down compared to 2025. In Engineered Composites, we expect continued year-over-year growth, supported by ongoing program ramps across both commercial and defense platforms. For the fourth quarter of 2026, we continue to expect consolidated revenue in the range of $325 million to $335 million. We anticipate adjusted EPS in the range of $0.65 to $0.75 per diluted share and an effective tax rate of approximately 29.5%.

Now we would like to open the call for questions. Operator?

Operator

[Operator Instructions] Your first question comes from the line of Chigusa Katoku with JPMorgan.

질의응답

Chigusa Katoku

So my first question is on the AEC margins. So there were adjustments for CH-53K both the top line and the EBITDA line. And also, I think you called out in your prepared remarks some tariff refund and discrete items. So adjusting for all of those, what was the underlying EBITDA margin profile of the segment in the third quarter?

Sean Valashinas

Yes, Chigusa, the tariff refunds were spread across both businesses, so really not as much to AEC. But if you back away the -- all of the impacts that you laid out there, you're looking at about a margin profile of 12.5% EBITDA margin for the quarter in AEC, excluding those charges.

Chigusa Katoku

Okay. That's great. And so is the 12.5-ish percent a reasonable assumption as we kind of model out to at least through the first quarter of 2027. And then from the third quarter, I think you'll have some ramp in margins. If you have any color there, that would be great.

Sean Valashinas

Yes, sure. Thanks. So the 12.5% should -- as we move into the fourth quarter and the beginning of 2027, that's a reasonable approximation. We'll start to see some growth as we move into the future quarters, but start with 12.5% as a base and then some reasonable growth coming out of that. And really, the growth is driven by a number of things that we started to experience this quarter. We landed on increased pricing with some of our existing contracts. We obviously renegotiated the legacy contracts that were in a loss position or exited them, for instance, on Gulfstream. We had increased volume and activity levels on our existing contracts. And again, we renegotiated contracts. So we hit on all cylinders and have really started to execute in that business. And so you'll see us increase margins as we move through the quarter into 2027. And our goal as we exit 2027 is to be in the mid-teens in this business.

Chigusa Katoku

Okay. Great. And if I could squeeze one more in, if I may. On the AEC top line, I think there were adjustments from CH-53K this quarter and also last quarter had some adjustments too. So what was the underlying growth rate of the business this quarter? And I think next quarter, you're assuming development growth. So kind of the right run rate to think about heading into 2027?

Gunnar Kleveland

Chigusa, I think you said Engineered Composites and the growth there. The primary growth for our Engineered Composites segment is our current programs. So there's growth on LEAP. There's growth on the Boeing one-piece frames. There's growth in the missile and there's growth in the engine section of the business. There are some new programs that are starting to take effect, and we will see more of that effect as we go through 2027, which we will also talk more about at the Investor Day here in December.

Operator

Your next question comes from the line of Alexandra Mandery with Truist Securities.

Alexandra Eleni Mandery

What capacity and CapEx do missile hypersonics ramps need? CapEx was down versus last year as a result of facility optimization. So is that lower level sustainable? And you also had that $21.2 million IBAS contract to support hypersonic and solid rocket motor manufacturing. If you could discuss how that plays into the build-out.

Gunnar Kleveland

Alex, you partially answered my question with the IBAS award that we have. We've done significant investment in creating the capability of ceramic matrix composites. And we have the capability. We're doing development there. The additional money from IBAS will act to allow us to do everything in-house. So it adds machining capability as well as quality inspection as well as an addition to the densification process that we currently do not have. And there's some investment from our side there, but limited.

Now this is a capacity that is untapped in a very high demand area right now, as I think everyone knows. Eventually, we will run out of capacity in Rochester. And the investment beyond that, we will try to do in the same manner by some investment on our own and some investment from either our customers or the government. So that is working, and that is the plan.

As far as the capital, we're going to be very constructive in how we use the money that we use for capital. And there is going to be growth capital for both -- for mostly our new programs. But we have pulled back on the capital expenditures, as you saw this year. We expect to continue to invest in the significant growth that we see from Engineered Composites.

Alexandra Eleni Mandery

Great. And then can you update us on the progress of the catch-up in volumes after the equipment failure in Machine Clothing? And I guess, do you still expect those volumes to be caught up by year-end or maybe pushed into 2027?

Gunnar Kleveland

Yes. The equipment continues to run. And so the plan continues to be caught up by year-end. And we see that as absolutely possible, especially since the machine is now being assembled at our site. The new machine is being assembled and will be up and running by the end of the year. So I think we have been able to maintain the current machine and deliver on it through the year without any more downtime, and that risk is significantly lowered as well.

Operator

Your next question comes from the line of Jan Engelbrecht with Baird.

Jan-Frans Engelbrecht

I think I want to just focus a little bit again on the missile programs. You guys called out in the release that it contributed to third quarter AEC growth. And then we saw a nice announcement on the IBAS award for $21 million and then also the expansion of your facility, I think, last week through your press release. But at a high level, how should we think of sort of production content on the missile business versus qualifying new components and sort of the time line that it usually takes since you start talking with a customer to getting qualified and then entering production? Is it sort of similar to the IBAS contract sort of 30 months? Or just how should we think about that?

Gunnar Kleveland

Jan, it's a good question. Some of the growth that we're seeing is primarily in the programs, JASSM, LRASM, where we're already seeing significant demand, and we're ramping up with the new contracts we're getting from our customer.

I would say in a normal environment, once you get on a program, it takes 12, 24, 36 months to ramp up. With the need for -- well, need for speed, in the current market, I expect it to be faster. We're working with several of the OEMs for missiles. I'm not sure which ones we will end up with, but it is going to be on an accelerated schedule.

Some of this is R&D and development on the programs, and you'll start seeing that in '27. I think as I've said before, this used to be a medium to long term, then I said it was a medium. Now I say -- or medium to near term, now it's more near term. I think we'll start seeing impact in '27 and definitely in '28 rather than 30 months out. We have the capability today. What the IBAS contract does is increase and broaden the scope of our capabilities. So 3 years from now, when we're fully deployed on every opportunity is when we have the highest impact. But there's definitely opportunity for us to deliver both in '27 and '28.

Jan-Frans Engelbrecht

And if I can have a follow-up. You guys obviously had very strong cash generation in the third quarter here. There was some pull forward from the CH-53K contract. But I know that's a focus area since you've taken over is cash generation. But just how should we think about steady-state cash dynamics for Albany? I know there's maybe some working capital investments that you need to make given the demand. But how should we think about that? I know you can't talk too much ahead of the Investor Day. But just as we're exiting 2026, what's sort of the steady state? Or are you guys targeting operating cash growth in 2027, if you can comment on that?

Sean Valashinas

Yes, Jan, I'll take that one. I think you hit it well, right? We'll share more as we get into Investor Day in December. But as you think about Q4 and as we move into the beginning of Q1, right? What you saw this quarter, we certainly have started to focus -- there's a high degree of focus on cash flow within the business right now, right? We're generating improvements across the business. I don't know that I would characterize the 53K renegotiation as a driver of cash flow in the quarter. We'll start to see that into the fourth quarter and into 2027, particularly -- well, in all 4 quarters into 2027 as well. So you'll see some of that.

But I think you can -- our historic results in Q4 have typically been very strong cash flow in the quarter. I think you can expect to see strong cash flow maybe consistently -- consistent with what we've seen in Q3 or near that. And then as we move into Q1, that will follow the historic patterns that you've seen typically. But like you said, we'll share more of that at Investor Day as we move into December.

Jan-Frans Engelbrecht

Okay. Great. Sean, if I could squeeze in one more question. Just high-level thoughts that you guys have on capital deployment in terms of potential acquisitions, organic investments. I know you guys have talked about being very adamant about not bidding on structures assembly work in AEC, but high-level thoughts on capital deployment as we sort of exit this year.

Gunnar Kleveland

It's going to continue to be disciplined. But clearly, with some of these structural issues that we have now behind us, I will take more seriously some of the inbounds that we have for potential acquisitions. We have the capability to do that. I know we have the team that can incorporate an acquisition. But we also have a lot of inorganic -- organic, rather, opportunities. So it will be a continued disciplined approach and including our dividends.

Operator

There are no further questions at this time. I will now turn the call back over to Gunnar Kleveland for closing remarks.

Gunnar Kleveland

Thank you. And thank you, everyone, for joining us on the call today. We look forward to sharing more information and long-term targets in December at our Investor Day. If you have any questions about the event, please contact Karen. Thank you, and have a good day.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.