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HEICO Corp. Reports Operating Results (10-K)

December 22, 2010 | About:

10qk

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HEICO Corp. (HEI) filed Annual Report for the period ended 2010-10-31.

Heico Corp. has a market cap of $1.75 billion; its shares were traded at around $53.03 with a P/E ratio of 33.3 and P/S ratio of 2.8. The dividend yield of Heico Corp. stocks is 0.2%. Heico Corp. had an annual average earning growth of 13.8% over the past 10 years.HEI is in the portfolios of Chuck Royce of Royce& Associates, Mario Gabelli of GAMCO Investors, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors.

Highlight of Business Operations:

HEICO has continuously operated in the aerospace industry for more than 50 years. Since assuming control in 1990, our current management has achieved significant sales and profit growth through a broadened line of product offerings, an expanded customer base, increased research and development expenditures and the completion of a number of acquisitions. As a result of internal growth and acquisitions, our net sales from continuing operations have grown from $26.2 million in fiscal 1990 to $617.0 million in fiscal 2010, a compound annual growth rate of approximately 17%. During the same period, we improved our net income from $2.0 million to $54.9 million, representing a compound annual growth rate of approximately 18%.

As part of our growth strategy, we have continued to increase our research and development activities. Research and development expenditures by the Flight Support Group, which were approximately $300,000 in fiscal 1991, increased to approximately $11.8 million in fiscal 2010, $11.5 million in fiscal 2009 and $11.1 million in fiscal 2008. We believe that our Flight Support Group s research and development capabilities are a significant component of our historical success and an integral part of our growth strategy. In recent years, the FAA granted us PMAs for over 400 new parts and approximately 200 DER-approved repairs per year; however, no assurance can be given that the FAA will continue to grant PMAs or DER-approved repairs or that we will achieve acceptable levels of net sales and gross profits on such parts in the future.

As part of our growth strategy, we have continued to increase our research and development activities. Research and development expenditures by the Electronic Technologies Group were $10.9 million in fiscal 2010, $8.2 million in fiscal 2009 and $7.3 million in fiscal 2008. We believe that our Electronic Technologies Group s research and development capabilities are a significant component of our historical success and an integral part of our growth strategy.

Our total backlog of unshipped orders was $142.5 million as of October 31, 2010 compared to $104.5 million as of October 31, 2009. The Flight Support Group s backlog of unshipped orders was $48.3 million as of October 31, 2010 as compared to $32.9 million as of October 31, 2009. This backlog excludes forecasted shipments for certain contracts of the Flight Support Group pursuant to which customers provide only estimated annual usage and not firm purchase orders. Our backlogs within the Flight Support Group are typically short-lead in nature with many product orders being received within the month of shipment. The Electronic Technologies Group s backlog of unshipped orders was $94.2 million as of October 31, 2010 as compared to $71.6 million as of October 31, 2009. The increase in the Electronic Technologies Group s backlog is principally related to backlog of the business acquired during fiscal 2010. Substantially the entire backlog of orders as of October 31, 2010 is expected to be delivered during fiscal 2011.

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10qk
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