0000046619-26-000016
SEC filingHEICO delivered record YTD results driven by strong organic growth and acquisitions, with 20% revenue growth and 29% operating income expansion.
HEICO Corporation reported strong results for the first six months of fiscal 2026. Consolidated net sales increased 20% to a record $2.55 billion, driven by robust organic growth across both segments and contributions from recent acquisitions. Gross profit margin improved by 50 basis points to 40.1%, reflecting a more favorable product mix, particularly in the Flight Support Group (FSG). Operating income surged 29% to $610.3 million, with operating margin expanding 160 basis points to 23.9% due to SG&A expense efficiencies and higher gross margins. Interest expense decreased 3% to $63.6 million, benefiting from a lower weighted-average interest rate despite higher debt balances. Net income attributable to HEICO rose 31% to $424.0 million, or $3.01 per diluted share, compared to $2.31 in the prior year period. The effective tax rate increased to 17.1% from 14.4%, primarily due to a smaller discrete tax benefit from stock option exercises.
The FSG achieved net sales of $1.75 billion, an 18% increase, driven by 16% organic growth and $36.1 million from acquisitions. The organic growth was broad-based, with aftermarket replacement parts up $161.9 million, repair and overhaul up $40.3 million, and specialty products up $30.5 million. FSG operating income rose 26% to $443.8 million, and operating margin improved 170 bps to 25.4% on SG&A leverage and higher gross margins. The Electronic Technologies Group (ETG) posted net sales of $830.2 million, up 23% with 12% organic growth and $79.8 million from acquisitions. Organic growth was led by other electronics (+$30.7 million), aerospace (+$21.8 million), and defense (+$19.9 million). ETG operating income increased 26% to $195.1 million, and operating margin rose 50 bps to 23.5% due to SG&A efficiencies.
For the remainder of fiscal 2026, management expects continued net sales growth at both segments, supported by underlying demand and recent acquisitions. The company intends to pursue further acquisitions aligned with its strategic objectives while maintaining liquidity and financial flexibility. Fiscal 2026 capital expenditures are estimated at $85-$95 million. HEICO remains well-positioned with a total debt to shareholders' equity ratio of 53.3% and compliance with all debt covenants.