Financial Performance - Consolidated net sales increased by 30% to a record $3,857.7 million in fiscal 2024, up from $2,968.1 million in fiscal 2023[197]. - Flight Support Group (FSG) net sales rose by 49% to $2,639.4 million, driven by $643.5 million from acquisitions and 13% organic growth[197]. - Electronic Technologies Group (ETG) net sales increased by 3% to $1,263.6 million, with $40.7 million from acquisitions, but a 2% organic decline[197]. - Net income attributable to HEICO increased by 27% to a record $514.1 million, or $3.67 per diluted share, in fiscal 2024[211]. - Operating income for the same period was $697.7 million, leading to a net income from consolidated operations of $559.5 million, and net income attributable to HEICO was $526.0 million[242]. - Operating income increased to $824,455 thousand in 2024, up 31.8% from $625,339 thousand in 2023[288]. - The company reported a comprehensive income attributable to HEICO of $528,213 thousand for 2024, compared to $409,915 thousand in 2023, marking a 28.9% increase[290]. Expenses and Costs - Consolidated operating income increased by 32% to a record $824.5 million, with FSG operating income rising by 53% to $593.1 million[204]. - Total new product research and development expenses rose to $111.3 million in fiscal 2024, up from $95.8 million in fiscal 2023[199]. - Interest expense increased to $149.3 million in fiscal 2024, compared to $73.0 million in fiscal 2023, primarily due to higher outstanding debt from acquisitions[207]. - Consolidated selling, general and administrative expenses were $677.3 million in fiscal 2024, up from $528.1 million in fiscal 2023, with a decrease in SG&A as a percentage of net sales to 17.6%[200]. - The company incurred acquisition costs of $20.0 million for Wencor and $5.5 million for Exxelia, which were recorded as SG&A expenses[364][372]. Cash Flow and Debt - Net cash provided by operating activities increased by $223.6 million, a 50% increase, reaching $672.4 million in fiscal 2024[220]. - Total debt decreased from $2,478.1 million in October 2023 to $2,229.4 million in October 2024, resulting in a total debt to total capitalization ratio of 38%[215]. - Net cash used in investing activities totaled $293.2 million in fiscal 2024, primarily for acquisitions of $219.3 million[222]. - Cash and cash equivalents decreased to $162,103 thousand in 2024 from $171,048 thousand in 2023, a decline of 5.2%[283]. - Payments on revolving credit facility totaled $(365,000), a decrease from $(989,000) in the previous year, indicating improved cash management[306]. Acquisitions and Growth Strategy - The company plans to drive growth through recently completed acquisitions and is positioned to capitalize on future acquisition opportunities[212]. - The company completed the acquisition of Wencor Group for a total consideration of $2,054.366 million, including $1,923.098 million in cash and 1,137,628 shares of HEICO Class A Common Stock[361][362]. - The acquisition of Wencor contributed approximately $185.7 million to the company's consolidated net sales and $22.6 million to net income for the fiscal year ended October 31, 2023[364]. - The company acquired Exxelia International SAS for a total consideration of $503.996 million, with cash paid amounting to $515.785 million, net of cash acquired[369]. - The company also acquired 87.9% of Mid Continent Controls, Inc. and 92.5% of Marway Power Solutions, Inc. in October and September 2024, respectively, using cash from operating activities[374][375]. Financial Position and Assets - Total assets as of October 2024 were $7,592,822 thousand, an increase from $7,195,063 thousand as of October 2023[283]. - Current assets, excluding net intercompany receivables, totaled $1,642.3 million, while current liabilities were $546.7 million, resulting in a current ratio of approximately 3.0[242]. - The company’s goodwill increased to $3,380,295 thousand in 2024 from $3,274,327 thousand in 2023, reflecting a growth of 3.2%[283]. - Total liabilities decreased to $3,529,260 thousand in 2024 from $3,637,105 thousand in 2023, a reduction of 3.0%[283]. Tax and Shareholder Information - Effective tax rate decreased to 17.5% in fiscal 2024, down from 20.0% in fiscal 2023, reflecting larger tax benefits from stock option exercises[209]. - Cash dividends declared were $29,069 thousand, reflecting a per-share dividend of $0.21, up from $27,370 thousand or $0.20 per share in the prior year[300]. - Basic net income per share attributable to HEICO shareholders rose to $3.71 in 2024, up from $2.94 in 2023, reflecting a 26.2% increase[288]. Accounting and Reporting - The Company recognizes revenue when control of a promised good or service is transferred, primarily at a point-in-time, with the majority of revenue recognized upon shipment or delivery[336]. - The Company utilizes the cost-to-cost method for over-time revenue recognition, measuring progress based on costs incurred relative to total estimated costs[342]. - Stock-based compensation expense is recorded based on the grant date fair value of stock options, recognized ratably over the award's vesting period[349]. - The Company is evaluating the impact of ASU 2023-07 on its disclosures, which expands reportable segment disclosure requirements effective for fiscal 2025[357].
HEICO (HEI_A) - 2024 Q4 - Annual Report