Financial Performance - Consolidated net sales for the first quarter of fiscal 2024 increased by 44% to $896.4 million, up from $620.9 million in the first quarter of fiscal 2023[76] - Flight Support Group (FSG) net sales reached a record $618.7 million, reflecting a 67% increase, while Electronic Technologies Group (ETG) net sales increased by 12% to $285.9 million[76] - Consolidated operating income rose by 39% to $180.2 million, with FSG operating income increasing by 63% to $136.1 million, while ETG operating income decreased by 2% to $55.3 million[80] - Net income attributable to HEICO increased by 23% to $114.7 million, or $0.82 per diluted share, compared to $93.0 million, or $0.67 per diluted share, in the prior year[85] Expenses and Margins - Gross profit margin for the first quarter of fiscal 2024 was 38.7%, down from 39.3% in the prior year, primarily due to higher inventory obsolescence and increased R&D expenses[77] - Selling, general and administrative (SG&A) expenses increased to $166.6 million, up from $114.4 million, with SG&A as a percentage of net sales at 18.6% compared to 18.4%[78][79] - Interest expense surged to $38.6 million from $6.1 million, mainly due to increased debt from fiscal 2023 acquisitions[82] Tax and Future Outlook - The effective tax rate decreased to 11.8% from 16.9%, reflecting a larger tax benefit from stock option exercises[84] - The company anticipates continued net sales growth in both FSG and ETG for the remainder of fiscal 2024, driven by acquisitions and product demand[86] Assets and Liabilities - Current assets of the Guarantor Group increased to $1,500,432 thousand as of January 31, 2024, from $1,440,062 thousand as of October 31, 2023, reflecting a growth of approximately 4.5%[104] - Noncurrent assets rose to $4,557,886 thousand as of January 31, 2024, compared to $4,490,490 thousand as of October 31, 2023, indicating an increase of about 1.5%[104] - Current liabilities decreased to $491,650 thousand as of January 31, 2024, from $531,466 thousand as of October 31, 2023, showing a reduction of approximately 7.5%[104] - Noncurrent liabilities increased to $2,978,330 thousand as of January 31, 2024, compared to $2,895,592 thousand as of October 31, 2023, representing an increase of about 2.9%[104] Cash Flow and Market Risk - The Guarantor Group's cash flow and ability to service guaranteed debt securities depend on the earnings distribution from subsidiaries, including non-guarantor subsidiaries[101] - The company has not identified any material changes in its sensitivity to market risk since the last annual report[108] - Forward-looking statements are subject to various risks and uncertainties, including public health threats and changes in commercial air travel demand, which could impact future performance[107]
HEICO (HEI_A) - 2024 Q1 - Quarterly Report