Heico Corp (HEI), a manufacturer of electronic related products and services, has recorded a 15.27 percent increase in profit for the quarter ended Jul. 31, 2014. The company earned $33.37 million or $0.49 a share in the third-quarter compared with $28.95 million or $0.43 a share a year ago. Analysts on average had predicted net income of $0.44 a share.
Revenue during the third-quarter grew 8.95 percent to $291.03 million from $267.13 million in the last year period.
Gross margin contracted by 101 basis points over the previous year period to 35.50 percent. Total expenses as a percentage of revenues increased to 82.78 percent from 81.88 percent in the same period last year. That has resulted in contraction of 90 basis points in operating margins to 17.22 percent.
The company disclosed operating income of $50.11 million compared with $48.41 million in the last year period.
Laurans A. Mendelson, HEICO's Chairman and CEO, commented on the company's third quarter results stating, ''We are very pleased to report yet another strong quarter highlighted by record consolidated net sales and net income. These results principally reflect record quarterly net sales within the Electronic Technologies Group, continued growth in net sales within the Flight Support Group and a year-over-year increase in our quarterly consolidated operating income.''
Cash Flow
Heico Corp has generated cash of $127.23 million from operating activities during the nine month period, up 37.86 percent or $34.94 million when compared with the last year period. The company has generated 15.15 cents of operating cash flow in every sales dollar for the nine month period, up from 12.79 cents in the same period last year.
The company has spent $21.03 million cash to meet investing activities during the nine month period, as against cash outgo of $147.91 million in the last year period. It has made net capital expenditure of $12.26 million during the nine month period, which was lower by 9.15 percent or $1.24 million, from a year ago.
The company's free cash flow accounted for 90.36 percent of operating cash flow for the nine month period, compared with 85.38 percent in the last year period.
The company has spent $100.61 million from financing activities during the nine month period, as against cash inflow of $46.89 million in the last year period. It has borrowed net of $10 million through debt during the nine month period. It has raised net of $0.87 million by selling common stocks.
The company's cash dividend payment decreased 14.56 percent or $18.40 million to $107.93 million. Dividend payment accounted for 84.83 percent of operating cash flow for the nine month period, compared with 136.88 percent in the same period previous year.
As on Jul. 31, 2014, the company's cash balance stood at $20.94 million, up 64.00 percent or $8.17 million from Jul. 31, 2013.
Working Capital
Heico Corp has witnessed an increase in the working capital over the last one year. The company's working capital stood at $297.58 million as at Jul. 31, 2014, up $31.36 million or 11.78 percent from $266.22 million on Jul. 31, 2013. It registered an increase in current ratio to 3.19 as at Jul. 31, 2014 from 2.88 on Jul. 31, 2013.
Debt Position
Heico Corp has witnessed an increase in the total debt over the last one year. As on Jul. 31, 2014, total debt stood at $386.33 million, up 20.90 percent or $66.79 million, from Jul. 31, 2013. The company's total debt was 25.63 percent of total assets as on Jul. 31, 2014, compared with 23.04 percent on Jul. 31, 2013. It has witnessed an increase in debt to equity ratio to 0.52 on Jul. 31, 2014 compared with 0.46 on Jul. 31, 2013.
Shares of the company gained $1.34 or 2.53 percent to settle at $54.40 on Tuesday.
