HEICO Corporation Reports Record Net Sales and Net Income for the First Quarter of Fiscal 2013; Full Year Sales and Net Income Growth Estimates Raised
HOLLYWOOD, Fla. and MIAMI, Feb. 20, 2013 (GLOBE NEWSWIRE) -- HEICO CORPORATION (NYSE:HEI.A) (NYSE:HEI) today reported that net income increased 4% to $20.0 million, or 37 cents per diluted share, for the first quarter of fiscal 2013, up from $19.2 million, or 36 cents per diluted share, for the first quarter of fiscal 2012. First quarter fiscal 2013 net income includes a 2 cents per diluted share benefit from the retroactive extension of the R&D income tax credit.
Operating income was $34.9 million in the first quarter of fiscal 2013 compared to $37.6 million in the first quarter of fiscal 2012. Our consolidated operating margin was 16.1% in the first quarter of fiscal 2013 compared to 17.7% in the first quarter of fiscal 2012.
Net sales increased 2% to $216.5 million in the first quarter of fiscal 2013, up from $212.7 million in the first quarter of fiscal 2012.
Laurans A. Mendelson, HEICO's Chairman and CEO, commented on the Company's first quarter consolidated results stating, "Despite a challenging global business environment, our segments performed in line with budgeted expectations and are positioned to take advantage of the anticipated growth in the markets we serve during the second half of fiscal 2013. Consistent with our management's philosophy of investing in future growth, we increased spending on new product development during the first quarter of fiscal 2013 by approximately 13% over the first quarter of fiscal 2012.
Cash flow provided by operating activities increased $15.5 million to $13.3 million for the first quarter of fiscal 2013 as compared to a negative $2.3 million position in the first quarter of fiscal 2012. We continue to expect strong cash flow provided by operating activities totaling approximately $140 million for fiscal 2013. Capital expenditures were $4.5 million in the first quarter of fiscal 2013 compared to $3.8 million in the first quarter of fiscal 2012. Additionally, we continue to plan for approximately $18 - $20 million in capital expenditures during fiscal 2013.
Our net debt to shareholders' equity ratio was 37.3% as of January 31, 2013, with net debt (total debt less cash and cash equivalents) of $235.8 million principally incurred to fund certain fiscal 2012 acquisitions and the payment of a one-time special and extraordinary cash dividend totaling $116.6 million in December 2012. We have no significant debt maturities until fiscal 2018.
As expected, global economic uncertainty and domestic governmental spending reductions were principal contributing factors to the nominal sales growth and lower operating income reported in the first quarter of fiscal 2013. As we look ahead for the remainder of fiscal 2013, we remain optimistic in the consensus outlook for the commercial airline industry and expect to see growth in airline capacity and maintenance spending in the back half of fiscal 2013. Additionally, we expect improving demand for certain products of our Electronic Technologies Group in the space, aerospace and medical industries.
Based on current economic visibility, we are increasing our estimates of full year fiscal 2013 year-over-year growth in net sales to 6% - 8% and growth in net income to 9% - 11%, up from our prior growth estimates of 5% - 7% in both net sales and net income. Additionally, we continue to estimate consolidated operating margins to approximate 18% for the full fiscal 2013 year. Approximately seventy five percent of this growth is expected to be organic which would represent organic growth of approximately 7% for the balance of fiscal year 2013. HEICO remains committed to acquiring profitable businesses at fair prices, and we are actively pursuing opportunities within both our segments. These estimates do not include the impact of any potential 2013 acquisitions."
Flight Support Group
Eric A. Mendelson, HEICO's Co-President and President of HEICO's Flight Support Group, commented on the Flight Support Group's first quarter results stating, "Our Flight Support Group performed in line with management expectations and is positioned to take advantage of improving market conditions. Operating results for the first quarter of fiscal 2012 were a challenging comparable period to the first quarter of fiscal 2013 because the first quarter of fiscal 2012 was highlighted by 10% organic sales growth, an increase of 25% in operating income and a 1.5% improvement in operating margin.
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