Heico Corp (HEI.A) Reports Record Operating Income and Net Sales for Q4 and Full Fiscal Year 2023
Fourth quarter net sales surged 54% to a record $936.4 million, with full fiscal year net sales climbing 34% to a record $2.968 billion.
Operating income for Q4 increased by 29% to $189.4 million, contributing to a 26% rise in operating income for the full year.
Net income attributable to Heico Corp (NYSE:HEI.A) grew by 6% in Q4 and 15% for the fiscal year, despite acquisition-related costs.
EBITDA saw a significant increase of 36% in Q4 and 28% for the fiscal year, indicating strong earnings before interest, taxes, depreciation, and amortization.
Warning! GuruFocus has detected 4 Warning Sign with HEI.A.
On December 18, 2023, Heico Corp (NYSE:HEI.A) released its 8-K filing, disclosing a remarkable financial performance for both the fourth quarter and the full fiscal year of 2023. The company achieved record-breaking operating income and net sales, driven by robust demand in the commercial aerospace market and strategic acquisitions.
Financial Highlights and Performance
Heico Corp (NYSE:HEI.A) reported a stellar 54% increase in net sales for the fourth quarter, reaching $936.4 million, up from $609.6 million in the same period last year. The full fiscal year also saw a significant rise, with net sales growing 34% to $2.968 billion. Operating income followed suit, with a 29% increase in Q4 to $189.4 million and a 26% rise for the full year to $625.3 million.
Despite incurring acquisition costs related to the Wencor Group and Exxelia International acquisitions, net income attributable to Heico Corp (NYSE:HEI.A) increased by 6% in Q4 to $103.4 million and by 15% for the fiscal year to $403.6 million. Earnings per diluted share for Q4 were $.74, up from $.70 in the previous year, while the full year saw a jump from $2.55 to $2.91 per diluted share.
Segment Performance and Future Outlook
The Flight Support Group and Electronic Technologies Group both contributed to the record net sales, with the former achieving 74% growth in Q4 and 41% for the full year. The Electronic Technologies Group reported a 28% increase in Q4 and 26% for the full year. The company's Chairman and CEO, Laurans A. Mendelson, expressed confidence in the future, anticipating continued growth driven by recent acquisitions and product demand.
Operational and Financial Strength
Heico Corp (NYSE:HEI.A) demonstrated financial resilience with improved cash flow from operating activities, which rose to $148.4 million in Q4. The company's total debt to net income attributable to Heico ratio was 6.14x as of October 31, 2023, reflecting the strategic financing of the Wencor acquisition. The Board of Directors' declaration of a semi-annual cash dividend underscores their confidence in the company's prospects.
Non-GAAP Financial Measures
Heico Corp (NYSE:HEI.A) also provided non-GAAP financial measures, including EBITDA and net debt to EBITDA ratio, to offer additional insights into its performance. EBITDA for Q4 was $234.2 million, a 36% increase, while the full year saw a 28% rise to $758.3 million. The net debt to EBITDA ratio stood at 3.04x, indicating the company's leverage position.
In conclusion, Heico Corp (NYSE:HEI.A)'s robust financial results for the fourth quarter and full fiscal year of 2023 reflect the company's strong position in the aerospace industry and its strategic growth initiatives. With continued demand for its products and services, Heico is poised for further success in the coming fiscal year.
Explore the complete 8-K earnings release (here) from Heico Corp for further details.
This article first appeared on GuruFocus.
