Heico Shares Climb on Record Q3 Earnings, Beats Estimates
Aerospace firm's Flight Support and Electronic Technologies units drive 16% jump in year-over-year revenue.
Heico Corporation (NYSE: HEI) reported record financial results for its fiscal third quarter after the market closed Monday, surpassing analyst expectations and sending its shares higher in after-hours trading.
The aerospace and electronics manufacturer announced net sales of $1.15 billion, a 16% increase from the $992.2 million reported in the same period last year, narrowly beating the consensus estimate of $1.11 billion. Net income saw a significant 30% jump to $177.3 million. This resulted in diluted earnings per share of $1.26, well ahead of Wall Street’s forecast of $1.12.
The strong performance was largely driven by robust growth in the company's Flight Support Group, which posted a record $802.7 million in sales, an 18% increase year-over-year. The company attributed this surge to "continued growth and momentum in our aerospace aftermarket business," supplemented by contributions from recent acquisitions.
Heico's Electronic Technologies Group also delivered record net sales, growing 10% to $355.9 million, fueled by strong demand for its electronics, defense, and space products. The company's consolidated operating margin improved to 23.1% for the quarter, up from 21.8% in the prior year, reflecting increased efficiency and profitability.
In a statement, company management expressed confidence in their outlook, citing strong organic sales growth and a disciplined financial strategy. Heico also noted an improvement in its debt ratios, with its net debt to EBITDA ratio improving to 1.90x. Executives said they remain focused on capitalizing on acquisition opportunities and sustained organic demand.
Following the announcement, Heico's stock saw a modest uptick in after-market trading, as investors reacted positively to the strong beat and optimistic forward guidance.