Military sales of $90 million were up $11 million from a year ago. The biggest increases were in sales of equipment to our Japanese licensee on the F-15 and the Seahawk, on the V-22 tilt rotor, and in the Aftermarket. Aftermarket sales were up $2 million to a new total of just under $31 million.

This was another big quarter for the F-35 Joint Strike Fighter program. Sales were $19.6 million, an $800,000 increase from the fourth quarter of last year. Of that total, $9.5 million or a little under 50% was work done in our Company and the rest was work done by our partners. The increase in workload was all in our Company. We've taken a stronger leadership role as the program moves toward First Flight in the next month or so.

Last quarter, I described problems that had cropped up on the Airbus A400M cargo aircraft. We'd increased our loss reserve, at that time, in recognition of a redesign required by low-temperature performance and electromagnetic interference. In this quarter, we've added half a million dollars to that reserve for the anticipated costs of a number of smaller issues having to do with more extensive analysis work and continued support of integration testing. In addition, since we're on the eve of qualification testing on hardware that involves new technology, we've updated our evaluation of the technical risks and associated cost exposure, and, as a result, we've increased our program cost estimate by an additional $1.2 million.

On the Commercial side, sales, in the quarter, were up $9 million from a year ago to a new total of $52.5 million. Sales increased across the board. OEM sales to Boeing were up $2 million to $12 million. Airbus sales were up $1 million to almost $5 million. Our Business Jet product line was up $2 million to $9 million, and the commercial aftermarket was up $3 million to a new total of just under $22 million.

Aircraft '06 Total

For the whole of fiscal '06, military aircraft sales were up $34 million to $331 million. There were some big drivers for this increase. The first was the F-35, which finished the year at $76.7 million, up $15 million from a year ago. Most of the increase was work done in our Company. The Moog activity generated over $40 million or 52% of total F-35 sales, the rest being effort invoiced by our partners. Another big driver for the year was an $18 million increase in aftermarket sales to a new total of $112 million. The most noticeable aftermarket increase was in spares, repairs and overhaul for the Blackhawk Helicopter, no doubt occasioned by the activity in the Mideast.

There were other puts and takes in our portfolio of Military Aircraft programs, but the major ones, F-18 and V-22 were fairly stable year-to-year.

For the year '06, commercial aircraft sales were up $42 million or 27%. The new total was $197 million. Clearly, this market has recovered. The drivers were a $10 million increase in OEM equipment to Boeing, an $8 million increase in our Business Jet product line, and a $19 million increase in the commercial aftermarket. Commercial aftermarket for the year was just shy of $84 million.

Aircraft Margins

Margins for the quarter were a relatively strong 13.2%. The growth in aftermarket sales offset the very high level of R&D. 787 R&D expense for the quarter reached a new peak of $10.6 million.