Did Heico A beat or miss consensus estimates last quarter?

What is the revenue and EPS growth rate for Heico A year over year?

What does Heico A do and what are its main business segments?

What guidance did Heico A's management provide for the next earnings period?

What factors drove the changes in Heico A's revenue and profit?

What is Heico A's latest dividend and current dividend yield?

What is Heico A's gross profit margin?

What were the key takeaways from Heico A’s earnings call?

- **Record Financial Performance:** Q4 net income up 35% to $188.3 million, driven by 21% FSG and 14% ETG sales growth.
- **Defense Dominance:** FSG defense business grew 16% organically, outpacing commercial peers, with missile defense orders surging.
- **Acquisition-Driven Growth:** 5 acquisitions in FY25 contributed 5% of FSG and 7% of ETG sales, with 2 more pending.
- **Financial Strength:** 44% YoY cash flow growth to $295.3 million, net debt/EBITDA of 1.60, and FSG/ETG cash margins of 26.6%/27.3%.
- **Strategic Focus:** Golden Dome and PMA parts pipeline position HEICO for long-term defense and aerospace leadership.

**【Management Opening Remarks】**
- HEICO reported record fourth-quarter results, with consolidated net income of $188.3 million, up 35% year-over-year, driven by strong organic growth and acquisitions.
- Management emphasized Larry Mendelson's legacy of focusing on cash flow and operational excellence, which remains core to HEICO's strategy.
- The company declared a semiannual dividend of $0.12 per share, reflecting confidence in its cash generation capabilities.

**【CEO Commentary】**
- **Flight Support Group (FSG):** Net sales increased 21% to $834.4 million, with 16% organic growth and 5% from acquisitions. Operating income rose 30% to $201 million, driven by higher demand across all product lines and improved margins.
- **Electronic Technologies Group (ETG):** Net sales grew 14% to $384.8 million, with 7% organic growth and 7% from acquisitions. Operating income increased 10% to $89.6 million, supported by defense and aerospace product demand.
- Both groups benefited from a decentralized structure, enabling rapid innovation and customer responsiveness.

**【CFO Financial Commentary】**
- Consolidated EBITDA rose 26% to $331.4 million, with a net debt-to-EBITDA ratio of 1.60, down from 2.06 a year prior.
- Cash flow from operations reached $295.3 million, up 44%, reflecting strong profitability and working capital management.
- CFO Carlos Macau highlighted the company's ability to maintain margins despite intangible amortization, with FSG's cash margin at 26.6% and ETG's at 27.3%.

**【Q&A Highlights】**
- **Defense Growth:** Management emphasized opportunities in missile defense and Golden Dome, with significant orders and backlog. FSG's defense business grew 16% organically, outpacing commercial segments.
- **Acquisition Strategy:** HEICO plans to continue strategic M&A, with a pipeline of high-quality targets in both FSG and ETG. Recent acquisitions like EthosEnergy and Axillon are expected to be accretive.
- **Financial Flexibility:** Management expressed comfort with leverage (1.6x net debt/EBITDA) for transformative deals, while maintaining a balanced approach to capital allocation.
- **PMA Parts Pipeline:** HEICO maintains a steady pace of new PMA part introductions (around 500 annually), with FAA approvals proceeding smoothly.


HEICO Corporation (HEI) Q4 2025 Earnings Call Transcript

- **Record Q3 Growth**: Net income up 30% YoY to $177.3M, with FSG and ETG both setting new sales and margin records.
- **Acquisition Momentum**: $630M in deals over 9 months, including Gables (expected to be accretive within 12 months).
- **Margin Expansion**: FSG operating margin 24.7% (vs. 22.5% YoY), ETG at 22.8%, driven by repair growth and cost control.
- **Defense & Space Strength**: ETG defense organic sales +6% QoQ, missile defense backlog supports FSG expansion.
- **Cash Flow Dominance**: 8% YoY increase in operating cash flow to $231.2M, funding acquisitions without debt reliance.

**【CEO Opening Remarks】**
- HEICO reported record Q3 2025 results with consolidated net income up 30% YoY to $177.3M, driven by double-digit organic growth across core businesses and disciplined acquisitions.
- Flight Support Group (FSG) operating income rose 29% YoY to $198.3M, with 13% organic growth in net sales.
- Electronic Technologies Group (ETG) net sales increased 10% YoY to $355.9M, supported by strong demand in defense and space products.
- Cash flow from operations reached $231.2M, up 8% YoY, enabling $630M in acquisitions over the past 9 months.
- Gables Engineering acquisition (July 2025) is expected to be accretive within the year, marking HEICO's third-largest deal.

**【CFO Financial Commentary】**
- Consolidated EBITDA climbed 21% YoY to $316.4M, with net debt-to-EBITDA ratio improving to 1.9x from 2.06x.
- GAAP EPS was $1.26, up 30% YoY, while Non-GAAP metrics reflected strong cost control and margin expansion.
- FSG operating margin expanded to 24.7% (vs. 22.5% YoY), driven by repair and overhaul growth and SG&A efficiencies.
- ETG operating margin was 22.8%, with defense organic sales up 6% and other electronics up 16% YoY.
- Tax rate for the quarter was 18.9%, with expectations for 19-20% annually due to R&D tax credits and FDII benefits.

**【Q&A Highlights】**
- **Missile Defense Growth**: FSG and ETG are key suppliers to U.S. and allied defense programs, with significant order backlogs and pipeline expansion.
- **Supply Chain Resilience**: Decentralized purchasing and local supplier relationships mitigate risks, though some parts remain constrained.
- **Gables Integration**: Early results show alignment with expectations, with focus on leveraging HEICO's distribution network.
- **Leverage & Acquisitions**: Net debt-to-EBITDA at 1.9x leaves capacity for accretive deals, with $630M deployed in 2025.
- **Commercial Aerospace**: FSG's 75% non-engine exposure outperformed engine peers, with 13% organic growth despite mixed airline inventory trends.
- **Defense Spending**: U.S. administration priorities align with HEICO's lower-cost alternative parts strategy, driving defense segment growth.


HEICO Corporation (HEI) Q3 2025 Earnings Call Transcript

- **Record Q2 Growth**: Net sales +15% YoY to $1.11B, driven by 19% FSG growth and 7% ETG expansion.
- **Defense Dominance**: FSG defense sales +18% YoY, with missile defense backlog fueling 27% cash margin. ETG space products offset medical/defense declines.
- **Acquisition Momentum**: 4 FY2025 acquisitions, including Rosen Aviation, with accretive impact expected within 12 months.
- **Financial Strength**: Cash flow +45% YoY, net debt-to-EBITDA ratio improved to 1.86x. FSG operating margin expands to 24.1%.
- **European Expansion**: ETG European defense exposure grows with Exxelia and Air Cost Control benefiting from EU spending targets.


**【CEO & CFO Opening Remarks】**
- **Record Q2 Results**: Consolidated net sales up 15% YoY to $1.11B, operating income up 19% to $297.7M. Flight Support Group (FSG) net sales rose 19% to $767.1M, while Electronic Technologies Group (ETG) grew 7% to $342.2M.
- **Defense & Space Growth**: FSG defense net sales +18% YoY, driven by missile defense and UAV components. ETG space/aerospace products saw double-digit organic growth.
- **Acquisition Activity**: Completed 4 acquisitions in FY2025, including Rosen Aviation for in-flight entertainment systems. Acquisitions are expected to be accretive within 12 months.
- **Financial Health**: Cash flow from operations +45% YoY to $204.7M. Net debt-to-EBITDA ratio improved to 1.86x, down from 2.06x.

**【Flight Support Group (FSG) Details】**
- **Organic Growth**: 14% organic net sales growth, with parts & distribution +16%, repair & overhaul +11%, and specialty products +9%.
- **Margin Expansion**: Operating margin rose to 24.1% (vs. 23.0% YoY), driven by higher-margin defense products and cost efficiencies.
- **Defense Backlog**: Missile defense orders backlog remains strong, with FSG cash margin (EBIT A) at 27%.
- **Wencor Synergies**: Cross-selling PMA/DER products, sharing manufacturing capabilities, and leveraging e-commerce platforms.

**【Electronic Technologies Group (ETG) Performance】**
- **Space & Aerospace**: Organic growth in space products offset medical/defense declines. ETG operating income +3% to $77.9M.
- **European Expansion**: Exxelia and Air Cost Control benefit from EU defense spending (5% GDP target). ETG defense backlog is robust.
- **Other Electronics**: Mid-single-digit growth resumes after destocking, with order volumes improving.

**【Q&A Highlights】**
- **FSG Growth Drivers**: Airlines prioritize cost savings via HEICO's PMA/DER parts. FSG supply chain constraints easing, but demand remains strong.
- **Defense Strategy**: HEICO's low-cost alternatives for military parts align with Doge initiative. Defense business mix boosts FSG margins.
- **ETG Outlook**: ETG expects low-mid single-digit growth, with defense and space as key growth engines. Medical business showing signs of recovery.
- **Tariffs & Supply Chain**: Tariffs' impact minimal; FSG focuses on U.S.-based production for non-A&D markets. Inventory turns improving.
- **M&A Pipeline**: Active pipeline with accretive acquisitions in aerospace, defense, and space. Focus on decentralized, high-margin businesses.


HEICO Corporation (HEI) Q2 2025 Earnings Conference Call Transcript

- **Record Q1 Growth**: 15% revenue rise to $1.04B, 46% net income jump to $168M, with both FSG and ETG setting sales records.
- **Margin Expansion**: FSG operating margin up 120 bps to 23.3%, ETG margin +140 bps to 23.1%, driven by cost efficiency and organic growth.
- **Strategic Acquisitions**: $255M in Q1 deals (SVM, Honeywell, Millennium) targeting accretive earnings within a year, with 3x EBITDA leverage flexibility.
- **Defense Momentum**: ETG backlog at record levels, missile defense orders up sharply; FSG exploring DoD PMA opportunities for long-term savings.
- **Cash Flow Strength**: Operating cash flow +82% to $203M, net debt/EBITDA 2.1x, well below 3x target.


**【CEO Summary Section】**
- HEICO reported record Q1 2025 results with consolidated net sales up 15% YoY to $1.04 billion and net income surging 46% to $168 million. Flight Support Group (FSG) and Electronic Technologies Group (ETG) both set quarterly sales records, driven by organic growth and recent acquisitions.
- FSG operating income rose 22% to $166.1 million, fueled by 13% organic net sales growth in aftermarket parts and repair services. ETG operating income jumped 38% to $76.5 million, supported by 11% organic growth in defense and aerospace deliveries.
- HEICO completed three major acquisitions in Q1: SVM Limited (electronic components), Honeywell avionics assets, and Millennium International (bizjet avionics repair), all expected to be accretive to earnings within a year.
- The company maintained a strong cash flow position, with operating cash flow up 82% to $203 million, and a net debt-to-EBITDA ratio of 2.08x, unchanged from prior quarter.

**【CFO Financial Commentary】**
- GAAP net income of $168 million reflected a 46% YoY increase, driven by higher operating margins and a $26.5 million tax benefit from stock option exercises. Excluding tax benefits, EPS grew 40% to $1.01.
- Consolidated EBITDA rose 22% to $273.9 million, with FSG EBITDA margin improving to 23.3% and ETG margin expanding to 23.1%. Cash EBITDA margins (pre-amortization) were 26% for FSG and 27.2% for ETG.
- HEICO maintained disciplined capital allocation, using $255 million in Q1 for acquisitions while keeping leverage at 2.1x EBITDA, below the 3x target threshold.

**【Q&A Key Highlights】**
- **Margin Sustainability**: Management emphasized organic margin expansion through cost control and operational efficiency, with FSG and ETG EBITDA margins up 120-140 bps YoY. CFO Carlos Macau noted EBITDA margin trends have been consistent over 10 years, suggesting long-term durability.
- **Defense Growth**: ETG backlog hit record levels, with missile defense component orders up significantly. FSG is exploring DoD PMA opportunities, though contributions to 2025 revenue will be minimal.
- **Acquisition Strategy**: HEICO plans to continue M&A with 3x EBITDA leverage threshold, targeting accretive deals in aerospace, defense, and electronics. Recent SVM and Millennium acquisitions exemplify this strategy.
- **Supply Chain Resilience**: Despite global supply chain challenges, FSG and ETG maintained strong on-time delivery rates. Management expects ETG non-A&D markets to recover as customers deplete excess inventory.
- **Leverage Outlook**: CEO Larry Mendelson reaffirmed 2x EBITDA target, with flexibility to temporarily increase leverage for strategic acquisitions. HEICO’s strong cash flow generation allows rapid debt repayment (e.g., 3x leverage post-Wencor acquisition resolved within 12 months).


HEICO Corporation (HEI) Q1 2025 Earnings Call Transcript

HEICO Corporation (HEI) Q4 2024 Earnings Call Transcript

HEICO (HEI)-27 Aug 24-2024 Q3 Earnings call transcript

Heico (HEI)-29 May 24-2024 Q2 Earnings call transcript

Heico (HEI)-27 Feb 24-2024 Q1 Earnings call transcript

- **Record Q4 Growth**: HEICO achieved 29% year-over-year revenue growth, driven by Wencor and defense contracts. Operating income rose 29%, with a 6% net income increase.
- **FSG Outperformance**: Wencor contributed $185.7 million in sales, exceeding expectations. FSG margins reached 23% excluding acquisition costs, with cross-selling initiatives underway.
- **Defense Expansion**: ETG defense sales grew 26% sequentially, signaling sustained government demand. Management targets 2024 FSG margins of 21-23% amid integration efforts.
- **Debt Reduction Focus**: HEICO aims to deleverage to below 2.0x net debt-to-EBITDA, prioritizing free cash flow for debt repayment while exploring smaller acquisitions.

**【CEO Summary Section】**
- HEICO reported record fourth-quarter results with consolidated net sales of $1.1 billion, up 29% year-over-year. Operating income rose 29% to $203.4 million, while net income increased 6% to $103.4 million. The company attributed growth to strong demand for commercial aerospace products, defense contracts, and contributions from recent acquisitions like Wencor.
- Management emphasized the importance of cost control, with operating expenses declining 5% year-over-year. The company also declared a $0.10 per share semiannual dividend, marking its 91st consecutive payment.

**【Flight Support Group (FSG) Highlights】**
- FSG net sales surged 74% to $601.7 million, driven by the Wencor acquisition and 20% organic growth. Operating income reached $114.6 million, up 47% year-over-year. Excluding one-time acquisition costs, the segment achieved a 23% operating margin.
- Wencor contributed $185.7 million in net sales and $29.3 million in operating income, outperforming expectations. Integration efforts focus on cross-selling opportunities and leveraging Wencor's e-commerce platform.

**【Electronic Technologies Group (ETG) Performance】**
- ETG net sales increased 28% to $342.5 million, with defense-related sales growing 26% sequentially. Operating income was $86.4 million, reflecting contributions from Exxelia and strong demand for aerospace and defense products.
- ETG margins were impacted by $400 basis points of amortization from recent acquisitions, but core operations maintained a 25.2% operating margin.

**【Q&A Highlights】**
- **Wencor Integration**: Management expects FSG margins to stabilize around 21-23% in 2024, with Wencor's 23% margin aligning with legacy HEICO performance. Cross-selling initiatives and supply chain synergies are underway.
- **Defense Growth**: ETG defense sales grew 26% sequentially, driven by increased government spending and backlog execution. Management anticipates continued growth but warns of quarterly margin volatility.
- **Cash Flow & Leverage**: HEICO aims to reduce net debt-to-EBITDA from 3.04x to below 2.0x within 12-18 months. Free cash flow is prioritized for debt repayment, with smaller acquisitions considered on a case-by-case basis.
- **Supply Chain**: Lead times have improved, but semiconductor shortages remain a challenge. Management expects supply chain normalization by mid-2024.

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