HEICO (HEI) 24 May 222022 Q2 Earnings call transcript

Welcome to the HEICO Corporation Second Quarter and Full Year Fiscal 2022 Financial Results Call. My name is Patricia, and I will be the conference operator for today's call. Certain statements in today's call will constitute forward-looking statements, which are subject to risks, uncertainties and contingencies. HEICO's actual results may differ materially from those expressed or implied by those forward-looking statements as a result of factors, including the severity, magnitude and duration of the pandemic, HEICO's liquidity and the amount and timing of cash generation; lower commercial air travel caused by the pandemic and its aftermath; airline fleet changes or airline purchasing decisions, which could cause lower demand for our goods and services; product specification costs and requirements, which could cause an increase to our cost to complete contracts; governmental and regulatory demands, export policies and restrictions; reductions in defense fees or homeland security spending by U.S. and our foreign customers or competition from existing and new competitors, which could reduce our sales our ability to introduce new products and services at profitable pricing levels, which could reduce our sales or sales growth; product development or manufacturing difficulties, which could increase our product development and manufacturing costs and the lease sales; our ability to make acquisitions and achieve operating synergies from acquired businesses; customer credit risk, interest, foreign currency exchange and income tax rates; economic conditions, including the effect of inflation within and outside the aviation, defense, space, medical, telecommunications and electronics industries, which could negatively impact our cost; and revenue and defense spending budget cuts, which could reduce our defense-related revenue. Form call the to including, Securities limited filings this HEICO's all but to and to, with XX-Q filings and on listening are review encouraged of not Form Parties X-K. Form XX-K, Exchange Commission, or extent obligation as statements, applicable required of information, by update result otherwise, or any future forward-looking the We undertake events publicly except revise no new to whether a to law. the

Chief now call, Mendelson, we turn Officer. call over ahead, the Laurans and As to HEICO's Chairman sir. the I Executive go Please begin

you morning I'm Thank here Co-President teleconference. joining Executive this to on and Mendelson, President Support this quarter joined you very we to second HEICO's Flight of HEICO Eric announcement and earnings by Larry for and you and Mendelson, everyone our fiscal much Vice and Group; Victor XXXX Technologies HEICO of Carlos this Chairman I'm Mendelson, Co-President good HEICO's Group; call. morning and Macau, us welcome HEICO's of Thank President and HEICO's and President Corporation; CFO. Electronic CEO

take operating for our to would delivering like team thank few outstanding HEICO's minutes detail, to another quarter. I reviewing results all members in of Before a talented

and the Flight Group, quarterly aerospace net for as up sales fiscal quarterly in was XXXX. compared first I first in reflect services. the margin XX% organic and will for six continue fiscal driven second as aerospace customers in continued months sales of during results the and the the first quarter fiscal XXXX. improved fiscal truly trends our results and XXXX summarize a results And has from was XX.X% of record XX% income months growth it X% to mainly income of operating improved income of that income in to strong arising of fiscal XXXX of a XX% superior of the and operating business, XX% net Consolidated Consolidated in increases second of XX.X% fiscal and These net impact the to reported And products of highlights the excellence organic our demand principally within will in in and that second XXXX. and six XXXX to XXXX. These results from and the favorable and six second XXXX. up fiscal from quarter operating aerospace fiscal operating parts in XXXX. second quarter results. The our months quarter dedication fiscal services. acquisitions. compared operating for growth commercial respectively Consolidated commercial HEICO represents improved Your XXXX by principally the quarter XXXX into that record fiscal from optimistic the the second favorable these translated of reflect that by mainly And XX% quarter was XXXX. quarter am I of Group second trends to and consolidated Support shareholders. XX% respectively, quarterly Flight and sales XX.X% our Support operational delighted record positive the I our fiscal am remainder rebound for

net sales In growth Group. addition, the quarter the sequential income marks consecutive this of at Support seventh in operating Flight and

And XXXX. XXXX. was October as shareholders' to equity debt XX% of of that XX.X% compared total XX, to as Our April XX,

October was shareholders' XX, total equity which XXXX, and ratio compared of debt, as is X.X% April to net April XXXX. cash million Our to debt, XX, XXXX. equivalent X.X% of that as of as And cash $XXX.X compared XX, less of

X.XXx XX, XXXX. as was EBITDA to XXXX and debt X.XXx net XX, ratio and October April of Our

members and acquired high used pursue to previously In defense agreement filters membership the power and interest Pioneer in of military, like for of management return. team. acquisition interest discuss of financial in platforms. Corporation, our majorities XX% activity, significant in debt And we to owned XX% of high filter and Pioneer order we to by XXXX, acquire Industries. March shareholder spares which to custom And is remaining and no strength a and until successfully plan we I'd stock distributor assemblies utilize The ground XXXX. a certain recent aggressively of to various growth completed which to accelerate of manufacturer aviation, Marine XXXX, acquisitions have of space is the all quality be our and designer sizes fiscal March maximize We specialty the Flight continues applications. flexibility announced Pioneer's Microwave of

Flight accretive We Flight of HEICO Support closing. be to months to discuss of will to HEICO’s these following both Eric like the within the Group, he XX first Mendelson, I Support acquisitions At would of earnings and of results Group. this the introduce time, President and Co-President expect

continued first anybody Group’s second in the in million $XX.X million demand to as fiscal growth XX% XXXX organic six growth XXXX. from a of profitable XX% of Flight the Support increased XX% up and income $XXX.X of well strong months of Fight XXXX the I XX% fiscal and record products and XXXX. XX% I income Support an the scripted acquisitions. increased of higher in our six million increased because COVID our from first reflects numbers just $XXX.X after fiscal six second of the of months Support XXXX, congratulate commercial first Group’s Thank second The back this operating up net $XXX.X I as XXXX. resulting the that product six quarter in team sales for to up $XXX from The aerospace the as created fiscal Flight am majority fiscal $XX.X fiscal these second quarter the of say first and don’t second the mainly two impact the an Group’s for respectively, from months of months from would The years part sales fiscal recovery and operating all six quarter to to months $XXX.X increased Support of XXXX. and mainly six million and XX% air the record XXXX. XXXX margin the The record second be first of Flight the net sales fiscal principally Support the The months first have travel quarter in fiscal six and for commercial the COVID of way, profit a just and net net net fiscal you. operating of the from fiscal volume. mentioned previously in XXXX, improved expected organic in of sales as Group's realized two we from increase the crisis across $XX.X XXXX, By happened. years gross million quarter began to from personally efficiencies XXXX, think million aside The in awe the million problems after increased reflects up in Flight fiscal remarks, income within of performance sales of second months frankly, lines compared to results services quarter our the The industry. team. quarter million reflects such higher XXXX, in not in in to increased in in global the

mentioned in are. to XX.X% stress just Group’s cannot operating think previously fiscal improved these how second XXXX, months improved SG&A margin Group’s as six margin in improved of XXXX The as operating reflecting the fiscal in Support margin the well six profit increased margin, months quarter The efficiencies. up the of XX.X% as six the and fiscal operating results reflects first Support a of outstanding from fiscal for I XXXX. to XX.X% decrease the XX.X% of gross mainly fiscal sales, second up in in second Flight I XXXX. of enough a net in from of the So quarter the percentage quarter The Flight expenses months XXXX, principally mentioned first previously

HEICO’s Electronic Mendelson, results Technologies President of Technologies would Group Now Group. HEICO introduce to Co-President to like Victor the and the I of discuss of Electronic

the decreased of and well telecommunications suppliers, both and medical, for The profitable our first net demand sales defense XXXX to defense impact sales from as Technologies other quarter many six by fiscal in The sales fiscal The million first space, the of electronics for increased our periods months the six sales of mainly as offset in Electronic declined as our the acquisitions. quarter $XXX.X as XXXX. were decreased is product attributable net $XXX.X XXXX million Like industry Eric. other XXXX. products, half compared to Group’s defense first Technologies compared were to XXXX in net you, of of months Thank fiscal million million XXXX. XXXX fiscal second the in Group’s partially fiscal Electronic products, during $XXX.X second in the demand $XXX.X our

change As in in the our is to and surprising of sales various defense rest defense whether lower product. the which seems the rather proportionate in were defense our question more less usual trends essentially was say that sales the businesses change consistent that would concentrated a I we’re of and change phase or sales industry. products, isn’t it single or with

the we prospects and to excellent we planet. flow our growth sell in on wish backlog, over a so supplying over our years, the explained other our piece which markets. assortment all both order it reign Though, position would and long-term about of be doesn’t defense healthy product and that tend sales wish in programs our given case, worry excited weren’t products services we’ve sales we wide us As growth components and and we uneven, the defense remain our

order as second and of Technology XXXX expenses months Group’s fiscal of lower $XX ongoing XXXX. convinced operating quarter in rise XX.X% of from first defense compared in quarter, to risks and XXXX, the the increase XXXX second operating of was The as We and the was operating six I’ll percentage mainly services sales lower lower The in was defense XXXX The $XX.X activities. the products compared first Technologies months and increasing quarter, in six of the efficiency quarter fiscal resulting XX.X% increased and time. XX.X% Electronic in margin in as income the net to mentioned, important million levels the XXXX. XXXX. a research mainly in months margin operating $XXX.X in mentioned, operating Electronic previously XXXX to of previously mentioned margin decrease The to a net in Group’s principally product the profit the quarter months of efficiency second six as margin over decrease income of are first lower SG&A of and decrease quarter six Technology in the was of support first operating Larry second call development XX.X% The fiscal from development net the months profit will $XXX.X from sales, six XXXX Group’s six compared Electronic previously previously product principally reflects gross Electronic compared back that fiscal defense product first the the million sales percentage as sales turn for in fiscal XXXX. in reflects the and million lower new new as to the fiscal over Mendelson. need well Technologies global fiscal second second a The as fiscal to tensions first gross fiscal level, income months our means margin. fiscal million continue mentioned to Group’s as and expenses

six in partially six Consolidated $X.XX net XXXX from quarter product fiscal second were reflects million $XX.X quarter development XX% six and fiscal technologies is increased Victor. quarter million mentioned up R&D second increased Consolidated X.X% of per of first net the in the of in expense that income or Interest in of our effective net XXXX the million leadership sales in compared expense HEICO’s balance and in also by fiscal XX.X% and quarter the in rate million six $XXX.X of Depreciation XXXX. XXXX of the of million quarters second million increase in and decrease million to of the of second months $X the And increased first to previously second the in future and net XXXX reflects XXXX. pay $X.X or up second growth. that tax that to G&A of to not of per $XX.X reflects for was up XX% first of that $X.X from increases first strong to The the in XXXX. XXXX. second net expenses. were quarter quarter first XX% six the lower first in and the of of incurred nicely rate Flight XXXX. of quarter or first again, months fiscal quarter the Thank operations, in effective tax The our cash XXXX. $X.XX fiscal months of XXXX was $X.XX in of and of significant. growth. increase and XXXX of first $X.X XXXX HEICO’s fiscal and of increase months at in XXXX this principally tax-exempt fiscal borrowings second fiscal six such these was six increased mentioned was compared second $X.XX an of was XXXX. XXXX losses in $X.X that XXXX. the flow again, months principally in XXXX, market an fiscal will in in million second support was tax-exempt the six And plan the XXXX are million million of the fiscal fiscal first acquisitions And for losses that diluted Interest $X.X months revolving million expense in expenses The $X.X fuel administrative Support development decreased quarter in first expense, you, effective quarter of in attributable was and that new million fiscal Again, to the from up the in in Consolidated of in fiscal on fiscal to the principally $X.X sales overall months to was share diluted first second impact of respectively, that first of XX.X% fiscal a to XXXX SG&A or first six expenses ongoing second $XXX.X net that of six of the X% general, mentioned from million and unrealized of was million in months surrender XXXX consolidated the XXXX. increase and that fiscal of months tax quarter SG&A of continuing expense fiscal down of decrease six new of SG&A six $XX.X tax the down $XX.X nicely from million XXXX, compared the reflect it’s compared of about previously Other million to life facility. six our XXXX. stock plus policies R&D million unfavorable unrealized from fiscal and XXXX in income. fiscal critical support that an six rate months selling amortization to $X.X our and sales was and up that principally the of million increase both of totaled credit as from a resulted products unrealized $X.X months XXXX. of in XXXX. the in the up to offset fiscal ETG both XXXX XXXX, was acquisitions. second to to million And and quarter quarter and insurance growth, million. fiscal and our $X.X totaled sales the expense, million to and declines. of second increase fiscal quarter from income in our and cash compensation the XXXX quarters selling and to fiscal recent the XX% attributable million accounted in from increase The expense of previously the quarter the reflects in XXXX. in fiscal values X.X% fiscal the decreased in costs was in consolidate X.X% due which the average weighted first to $XX.X to sales fiscal million quarter quarter principally the $XX.X that expense and six use $XX.X gains operating in impact second in fiscal efforts in related the income months the that higher outstanding compared rate share sales $XX X.X% an second The XXXX expenses under HEICO we down months $XX.X SG&A reflects borrowings. a both in $XX fiscal from policies second months recognized months a first XXXX of Significant consolidated in and and as

compared last stock in of strong quarter tax the noncontrolling As stock and recognized from subsidiaries HEICO to quarter in of acquisitions. interests exercises in option fiscal certain fiscal in respectively, inclusive of noncontrolling $XX.X support of first a during of six $X.X that’s million second XXXX first HEICO in fiscal and teleconference, fiscal and XXXX quarter attributable increase of we reflects operating compared Net XXXX in the XXXX $XX.X of from fiscal attributable group of million both lease quarter’s benefit are principally discussed months fiscal $XX.X held. and six million which $X.X And million XXXX period. of the the income in discrete of months fiscal resulting XXXX, results appreciation improved as and million, first quarter income XXXX. interest interest to the XXXX in flight months Net second in that option the The million was holding to first the price XXXX. the second to was six noncontrolling $XX.X

the between rate XX% rate and full to tax XXXX we interest XX% pre-tax For and a fiscal noncontrolling income. estimate effective – year, combined of XX of continue

and Moving on in XXXX, $XXX.X in provided Cash operating fiscal six months of $XXX.X fiscal and cash million financial million was second $XXX.X the second quarter forecasted flow the for million and flow, $XX.X strong. XXXX. to compared – operating our million to remain position flow six as the activities balance quarter a sheet months by cash and extremely first respectively, and and of first

During approximately invested XXXX, a million capital. a inventory in increase backlog. support working change working businesses capital purchases includes we to million increase in consolidated $XX And strategic increase decision the $XX inventories, that in distribution our and within our to to an and reflects

In addition, from million to other current resulting growth. have our expenses million $XX Accrued $XX receivables principally net sales increased decreased due liabilities and by timing.

as up October times April that of capital working XX. from as And XX, of improved X.X times X.X ratio Our XXXX. at to was

sales XXXX exposure. net represented DSOs, April to collection to limit No days as XX% approximately Our efforts day top one credit of XX receivable net that five April days order quarter more and XX, of fiscal customer our second We and outstanding consolidated as customers the XX, in accounted XX% compared XXXX. consolidated sales in all monitor respectively. of closely XXXX, than of of for was XXXX. and XX And risk XX% sales

where period XX, the period turnover where April Our the And from XXX XXX ended days to XXXX. XXXX. ended XX, days inventory was that decreased April down rate

key we to can markets supply it recovery. the fiscal disruptions, including continue will feel path and the like influence variance, it to provide which Now benefit positively for outlook, travel effect, travel cautiously Despite for pandemic's sales new responsible we difficult and worldwide at XXXX we pandemic inflation, to net commercial including but vaccines, global still air continue boosters this the would remainder predict remains serve, commercial earnings markets. potential a and time. and we pandemic additional global that Therefore, the rollout air very ongoing and impact potential the to variants path ahead fiscal optimistic we not be rates, the to expect remain vaccination XXXX, and to our look guidance factors chain on of of

of the thank our In of I However, we for looks enable opportunities in are collectively believe very, gains. entire high HEICO which team. XXXX sheet, program, grow. very market and proud The members on me of all strong the to ongoing it you thank of we our their to take periodic we share great to, position extent future new floor like and HEICO to execute liquidity very the prepared tick that that successful the invest for make beyond us our HEICO. I questions. and degree again ones would remarks, of to HEICO are of fiscal balance would advantage to And And acquisition and HEICO, support That development that research which open and personally. strategic purchasing continuously for like and and to conservative promising closing, inventory, making our our for company is. They incredible all and remainder team commitment is policies,

Instructions] you. Poponak of is question from Noah Goldman line [Operator Your Sachs. from the Thank first

line is Your open.

it's on Noah. Good morning. for Hey, Gavin

morning. Good

Good morning.

as holds, to in of at rate through your pass just of do do So strategy the stepping any costs? the rest Eric, big historically, about up Is is or there. lever same to the, like you, the but it relative for increase discount or the of you rest kind pricing the a industry higher think been hasn't seems FSG you your how pricing? aim industry?

I pricing we we, is our margins. think think maintain Yes, the way to about want

list our percentage often are our competitors our our pass we've – margin doing. so, a what Having what got to prices of we've our that. top through the and costs, said margin added So on at to add reflect got minimum that,

we necessarily contractual sell our increases, we prices. price. committed And don't would those got raise take that we've long term at arrangements to when However, that discount a the got we customers, list to list we've where extent

years, meeting I've new solutions quite not successfully see us the, One able this, but a where maintaining from HEICO of people along time, taking with what HEICO; really on leadership and same we've are with results, they our that believe can differentiated our maintaining been others thank them customers stuff and that you called doing So a the coming currently And never not pass business with just to major like other little the And familiar HEICO. very ago. airline everybody products out their at MRO a to a had was to the senior on doing. increases business but all add to increase have develop along for all advantage not that that of I arrangement, them. of their a manufacturers, thank had the happy. that with. and we actually said and I as while was up with that actually weeks And offer, we would on profit they mention for senior wouldn't. name product it they number of our reason, going margin brought Dallas very, to them they two, of our number In really itself can't Conference other all frankly, And couple cost a brought sorts at our and anecdote stuff it's, we increased in a they be only to of depends wanted keeping new be rewarded my leadership helping

covered, of customers a importantly, costs going for our maintain we'll of we And most result our work, we'll in customers, happy opportunity will our us. treating bit. little or a summary, because our grow to get right, get a So is our we'll amount there's huge keep I margins this as think

and touching XQ pre-COVID better levels? XXXX I basis or as detail, think a appreciate in margin I continue back there that than margins, abnormal but to, to mean, you you're quarter is the, maybe pre-COVID that, points anything can there revenue just is revenue, your improve level above grow I there, the all you from on Great. the FSG, higher. XXX

our I customers with frankly, record margin the that Group, there's to environment Support this that though, amazed that we're I predict. I say for all am and what in careful the wouldn't want percentage I in keep of, abnormal to be operating able these quarter. which to Flight think I Yes. numbers, margins. our not mean, aware we're that happy anything record

So we will carefully. to want going be be continue careful we're very I to to replenishing obviously watch that because inventories.

engineering that what to our adding We growing positions, is. We're talent. have back some see

predict But want to I be margins. I we're careful higher good about So to where these feel headed.

you. Thank Great.

This add the XX% I road quickly at The is in is been in parts different be past, thinking return as that. of this seen Carlos. getting the path Keep going to real the that to little businesses because to OI or just there volume approaching would mind; level. FSG, the about the we've to a we've levels lumpy FSG grow rates. different

our affect margin quarter. so going the to that's And during

about the think going and recognize to why, and XX% down get to that's year, be along lumpy the I range for that it up would So it's there.

Helpful. Thank you.

question your of the from comes And Gautam line Cowen. Khanna next from

open. is line Your

Hey, morning guys. good

Good Morning.

maybe the specialized and FSG source business can of question. might products? was the repair growth within it mixed quickly subsegment on Was last the up maybe the benefit. you PMA to by led Carlos, follow Can talk to margins about Just Anything that improved? and you the there, that relative explain? – How

Gautam. Yes,

a little and the we a the strong volumes picked coming the probably And be to back as little would. up thought Their we to of think PMA all have of the expected notice talked we bit. return and they consistently tailwind, last where volumes a very was parts our tied, have quarter we Specialty board, you Their Group. strong I as market. OEM saw that's business, tend Products about bit which across business, been the

I'd That's have margin. So a impact been thing… the little that's it which increases the say if the would, did about products you only higher on a helped us, rate, historically, but mix than the, had especially

of the normalizing, of you end sort from in where, of a that inventory phase, dynamic faster was costs replenish benefit your out than any pricing there there your as sort was So inventory? prices reset might Okay, up reflected inventory?

question. a That's good

bit in over a have of do we come like instantaneous. It It's is Any have, we this a increases. our price does time. not mentioned, phases Eric As of delay.

with happen renegotiate we that our discuss relationship and doesn't As contracts instantaneously. the ongoing customers,

impact this So things I our not a cover as but to saw friendly do we Eric increases. huge strategy, our a nonetheless, will, And We'll cost increases, don't quarter, best margins We're like cover But effort from an to be to Again, as our we our to cost and we'll raising so. customers. that. think, pricing. term prices very it's it long said, trying know that boost will I continue. we're

Yes. budget Victor, speak you have since ETG, talk you about the can or, order And how pickup about enacted – anything in one formally was even for those of bookings, activity March, a flow? Victor, Yes. to seen maybe in have trended, can defense the you RFP the maybe

It's second a strong. us for last Actually, orders remains quarter that sort our Gautam. the of ratio are book-to-bill year, good entire versus so both Yes, quarter our accelerated in first of the and strong the year, half book-to-bill first question. very year, and of the

we're book-to-bill and and overwhelming that accelerating more but us that else, Of accelerating supply we've as is miscellaneous these it does. to ratio strong. as usually accelerating. looking greater which than got chain seem But to it fortunately, at be challenges, far like everybody contributes course, were they not probably the are and even book-to-bill They're

Thanks guys.

welcome. You're

you. Thank

Securities. next your Larry is question Solow from from And CJS

is open. line Your

as the out pretty nice environment, to I tough and for Good it's I a back on won't guess across get I almost mentioned very is – are sort the they color pretty that be some customers of, levels. go different share commendable there, between little a legacy commercial mixing from the Can you share must you. question existing Eric job. are acquisitions, FSG about an you there. on maybe that on be but stuff aviation, market Maybe high-level a newer big the products but of guys congrats some gains it, numbers, deciding it pretty you competitors. remarkable in because obviously coming the quarter to morning specific mostly of covered you older, the, any guess you Thank like your a terms you where pre-COVID Is really with and guys I you on and a assume it's gain much Great. that, less, from coming market got this bit little it and know mostly in take specifics, areas? a, the or factor it just, strong I get What we – if there? on but more feel and side, really

in that's week areas always Flight sort businesses, the get on the ground before of operates. business all of on the And mean, Larry, which you in latest going information And I our can I get I of involved prepared question. these tell what's in get I'm in calls always great to conference Yes. the – ground. but all I course, the – a with that on very Support

as and have parts, our fact not specialty decades. is defense haul I it know mantra do. that times the It's for from better leadership in people. support we making PMA to sure board. speak our of as our level highly the than we we It We component as XX.X fact HEICO, is are, And result gaining care never maintained company people got as our board. manufacturing, us in at my that distribution, make completely just – well we're opinion, this enthusiasm with in a share. grew is seen have and market And all across sustainment. of and tough, that decisions customers, I seen that the taking that to it I years absolutely it could are have my the for make think of if I the our they the never long our HEICO across been salespeople inventory able I our inventories of levered not the and actually sure they mean repair, teams

really aftermarket. is It's good. it incredibly across feel in really, It's honestly, broad-based. OEM. the business. it So And made the in It's It's defense all me sustainment. in our

guess, especially get things, right? assume in should these That's lasting, in would share be most these of I very pretty market they gains long them, you I encouraging,

they on we continue to a spoken I going impact any Yes. look, is the large our – have are and about we're how We've believe need up that that not lasting. of long always competitors. to trend

frankly, We're they're which doing areas see gains incremental. – are I we broad-based, and, all operate. very very, But in and very everything tremendous Our strength well. just

switching Okay, Victor. great. gears, for a And then just question quick

sort product. I – you the side, just component is be you defense mentioned obviously the On are end a slowness on the perhaps often on making issues some but could guys know some of chain a issues, of supply of component maybe these

So supply that competitors so your chain parts is from issues supply or sales? of if come just products, are slower issues are that at the to you're going delayed, not sort deliver play complementary Does with part? into defense chain maybe other maybe that there also –

on the does I don't or effect more they get our us, have of think, slow are not does say people And have is an things home. products I situation order it would yes. out down. it their getting because customers Larry, factory they working from on can't that dynamic pronounced overall, where people,

the orders say should few a or number that and of us our some And all it's will has can't actually but we in plant or an that. more et and a get that customers hear in or cetera. ship out coming, at of just factory take we And that mentioned out instances things to it's subsidiaries, we're in cetera, should happening so point, as and coming, while. of even And any those space, like et our it's had coming, that expecting you for the of course, a say, issue been I we

or month later. three So order two or expect a whatever or the

Right, right.

guys guys. increase in of inventories issues, you supply in just you Carlos, mentioned are control having rest if of inflationary in and seems I world, under million that inflation. plus some Okay, XX could on And one and terms slip it great. issues like well pretty the But to offset chain bit. for just Obviously, for the more little a help you just

selling $X existing in million almost and said, expense you your your think $X million G&A. I at mentioned was, there I drop think organic was up you less than

your was is from flat, thoughts was which pretty Any So almost that? basically legacy on SG&A remarkable.

Yes.

of we're entrepreneurial. very all, – structurally I think first during

of a their have entrepreneur. roots We those a that facilities running as subsidiaries have and different and managers sole lot proprietor

think learn they their how mentioned guys increased also to done exceptional how what best to we've and wallet, process. done manage And There those managing right. equation at cost. then job And cover throughout know that inflation Eric so a it I job adjust to when have that that their business, tenants earlier, no think good was with is to our And that the pretty costs working an checkbook, as this I of they is part because can. have customers HEICO the our of we doubt benefited

HEICO I equation So to that structure whole us at make the our allows think of happen. because

great. Right,

Excellent. guys. Okay. I all appreciate the Thanks color.

Larry. Thanks,

Thank you.

from Thank is And Arment question your next from you. Peter Baird.

open. Your line is

Larry, Yes, ask guess good Carlos. a morning M&A. I to wanted Hi. everyone, Victor, I Hey, Eric, on question Eric,

market, what pipeline? further? guys you time Or deals in before seeing commercial more Is need of more you're recovery you Just you a bit kind in leaning there willingness your see recently the talking to the deals of did pass two this more do you engage quarter. activity period? do kind the or in to little maybe in about in Are maybe some

where got them competitive. very think is, We're and we've to We that are ever But Yes. of very disciplined. the active we're busy, remain incredibly recognize and working the than market plenty be aggressively. very, there We busier been. that area, in opportunities we've the M&A I yes, market is

ultimately indicated and you then lot could I kind on – like to time you inventory end the a of both describe And throughout miscellaneous appreciate are supply mentioned kind just Maybe going Victor, you more Eric year? chain it, that. are some seeing Victor, any carrying out you lead – you've of Okay. the supply material just chain or stretch up just constraints.

is you continue this over the times believe Lead rule. the out fortunately increase. I'll suppliers to exception Victor. XXX components a far perspective not, as So, it not that ETG companies. some That's lead though or the for are weeks. from as, give There for times are

really quarter the and to generally, continue that that to million And call, I know, estimated just quarter. our we probably as that on found a effect that range we've of $XX slipped We those. one into next say I workarounds say last a I I little But continue to we would it in would this XX%, quarter expect the in more be I this in would of that from been than had think quarter finished have I such accelerate expect our course, conference the had was that's around it sort has approach prior of challenge. to XX% bit. minimized inventory the that. you would

than talking dealt higher a again, of to so growth of considerably few rather would those simmer And that. have but low with to percent actually sort our sales, not something been it and somewhat you're as continue keep about down address would not companies higher a say, overwhelming, a let they we'll our had certainly we or more But fire.

Yes. we And that to think were Peter, with Support smart. I Flight side regard the

inventory that we The to really going with intelligent orders shortage the is there Frankly, of making closely had into were sufficient coming think be people sure time. us. on there's And working sure for down challenge we this. could suppliers. very road. our that make delivered Our everything I We're be to get no hiccups

and Our figure people problems solutions ultimately me them. tell out about they to

I'm out So high restocking through we inventory I manage but say watching on would the that it. how figure alert to will issue, hopeful

opportunities year? and but is sounds like appreciate is approaching acceleration product an introductions just adoption? describe, of always Eric, you Maybe product I past kind then of kind seeing, up. more that. increasing every Or coming just the what of in generalities, kind of talk guess, one know you it are And from on you I there are if you pace customers of one, historical, add the catalog the of your last could new rollouts, more to new you the I

adoption. be would a greater – the of latter, It of more acceleration

more save line. rest the I the think development. buy product of with unsold lot of content if where we're very got potential lot new pace a We've of our people product money, they a can

stuff that first then increase product all get new to be of sold the would preference our and later. to rate development think I So

white spaces. are continually I grow in adjacent, We what adjacent – we call

development, there's of rate we we We've volume product procurement, got think to there's I support lot sure really of but got make well new a order to inspection, And that. new to manufacturing, very product balanced, you that sold. increase happen then is got to And everything no so in development we and change there, our optimized. chain if current sales, that get has very, the increase stuff

right well now. really we're I So think balanced

Appreciate Thanks. that.

you. Thank

And we Stanley. have the next Liwag Morgan Kristine question from the of line from

open. is line Your

Good This Jason guys. Kristine. on for is morning,

morning. Good

how Victor, look across and impacts about and businesses? think the FSG ahead, as recessionary we ETG Eric potential sort should both we of

impacts, down mean recessionary possibly the you say with When markets turning that in you the future?

Exactly.

GDP by driven guess, I say So just general decline, recessionary impact.

Yes.

in think downturn and continue share. up I to pick market a we up we've share picked market

and products. two And We to with So that's when given frankly, whatsoever. the of impact, afraid has consumers. moment, the out money I'm of at a pumped government question to the see last especially stuff, have of that people because issues it don't there's not kind all deflationary that it, there's consumer the lot bought comes no that years, for there

are They're the wants to you been nobody continue. today, And all if think that cares. one up. going trend they cooped traveling, of thing they pretty savings look, that elevated. And everybody the whether don't I levels COVID, care to have do everybody's COVID, is However, risk still they getting

air historic don't travel two GDP couple on I see occurring that next years. times So same the impact over of

Ukraine, impact impact. paid price is X this $XX they million at But company as industry. ingrained with can't in some how to there real And well power places that as mean so player I longer – the – to I little to we've are the mean, they be air that going an I our XX they us years. China, customers travel that think a huge enough us it's powerhouse that view view Russia, it going were insofar us tiny and we and view ago. HEICO, are see a think we years stress as I past no in I relatively going obviously I few are strong, think

So I think we're going to be the frankly. go company, to

coming us Victor, combined, which have tend not high for we recession because to a effect those in like economy markets, muted ETG, space does is broader recession. the this would it's the have, from medical typically defense a the And for and proportion and fairly suffer

seeing general markets and the Now commercial point, at precursor where not feel often to which strong look are non-A&D our that. enough, way, I and have a travel. certain very And healthy. an we in at our high economic this end depending might on interestingly as what our orders we aviation, by remain markets, serve impact with But overall that electronics remained activity happens

usual. business point, this to at it be seems as So

Thank guys. horizon? you're the parse the time Victor, some then of near-term you're just then to you, maybe a then seeing out Victor. of the sort more longer and can maybe And more in on one for in and you opportunities just speak opportunities seeing space

or call Yeas, tolerant hardened pursuing in not We business, space high so know, and successful radiation we've chase on much. micro solution. been try highly We're would very very to what as on I those the end, end markets. pursue space. radiation our really focused engineered often SATs high very We the you don't is

bigger, for entirely it. you not but if a expensive that's more So of satellites will, and part

the highly higher what us. everything So products. will kind not to in this of margin sort looking space continue opposed any really that's engineered picking not old we're revenue to explosion at in as of I we're to we're where and chasing to up is doing just more after expand our And opportunities be think end,

Our some And be more looking we're important if probably healthy value it elsewhere. then if a margin, customer. the at commoditized something they adding could margin, low it's means we're then view to that's it's – they or feel get we'd is

Understood. Thanks guys.

welcome. You're

RBC. from the of next Our from line is question Ken Herbert

line is Your open.

Yes. Hi, good morning.

Good morning.

morning, Ken. Good

thinking your bookings the previous the start Eric, pace any maybe seen is business continue assume wanted of it fair say slowdown haven't within that to in into fiscal for into that maybe just half why year, to shouldn't reason third then the you we business fiscal Hey sequential of any a and quarters? to of second pace backlogs the trends on change fourth of result repair and finer I through, then as any a any there airline with or the concerns question, or your in is growth growth booking point around

trends I Yes, growth I the in are think I improving and mean continued expect fourth and quarters. so booking third the

our all think the going share. do we're we're of and well businesses anticipate fourth in to third And very that quarters. grabbing to I that market I continue in

do that maybe And in a if the you've know very of I you we good cash capital year net I from a the great. not is think XXX%, been year. you're XXX% could into That's good working reasons. investing half there again, to seasonally, And any relates conversion should as for number full income sort full typically flow? in free very it for year? the the cash standpoint of How of back about Okay. Carlos, reason,

benchmarks. around Well, I think for the full year, we Ken, should be those historic

our six of pace continue to we get the correct, have on maybe a conversion business. think first bit we strong think we working do support If You're as the quite And they'll what the will bit with year, invest little in be revenues to months invested this But this on. year. more do. I goes year capital a

excellent. Thank Okay, there back. stop I'll and you. it pass

Thanks Ken.

Benchmark. from Sullivan Josh of line the have We

is Your line Josh line is your open. open. Sullivan,

on Good That morning. was mute. Sorry.

Good morning.

customer share historically market any either of in hands the entities, are adoption Just gains, this model, mentioned, or airline which were types more off acceleration you geographically coming the seeing products new business by on new environment? forward of you

but range there, we in to out every a adopting ever answer much than customers they every airline all of say, that yes, airline is more they're we broader product – have the so deal Yes, virtually are past. with ours, the of they

think names, much broadening not are not customer we adding us. – as I they're what yes, are we it's so while from significantly So adding buying

more one in just private strategics going interest environment, you obviously equity you then the private rate see was forward? from front, you'll competition interest past, driving noted Do up on changed. valuations, M&A have from And think the market target equity and less environment

to equity. private less from going see we're hope certainly competition I

none, people, do who about his finding and every take and and that greedy greedy blood it’s possibly when strategics, for care wants good the to a far right. no There seller. think a members, to the option bar HEICO, unique option a partner the who wants the I as best I are trick doesn’t type who really who is to stone. is isn’t proposition and seller seller frankly, seller that and HEICO far care team think penny of the treat the business, As that period, the to than they for wins right off. wants customers has we home good because to of her and the partner the of private And because equity you that or value shame from about of wants doesn’t care is can. frankly thing, better for customers get by type And wants can’t just typically take on with a trade And

all exactly their do. are And we companies many so we how we’re weeds get think And like to the they’re when into we focus very I come same that support office, up works corporate we and leadership teams. The instead HEICO we here of don’t motivational. well. page, operating doing, offer get it them crap with we incredibly proposition what extremely a We on the understand let buzzwords people and the business. – good detail, know the So them. on the And from – horse unique model find we this is for who also they’re

and to acquirers as personally to more also the intangible can I up do corporate to mean, they’re amortization money? So am very they’ve paying optimistic. going higher rates, interest I got have we. Yeah. pay deal Well, then with end

they are I’m So what in restrained I hope do. they But very optimistic. that

obviously nobody mean, we’re price they it to now. sell I And we competitive. to very right really else. us We’re buy ridiculously mean, busy lower sells always somebody at if a companies. competitive we’re than I

So continue. I’m will very optimistic trend that the

you Okay. that. for Well, thank

Thanks.

Thanks, Josh.

from have Jefferies. Konrad Greg We

line is open. Your

morning. Good

Good morning.

on this the recovery when to I but wide traffic we’ve data just kind know I we a touched broader Relative of terms surprises business, you see of regionally, any and bunch, to market. the that of the around maybe Maybe some or I versus about think narrow body just or Eric start. recovering in mean, body. areas are faster your those than that platforms mean,

didn’t bunch front get to in shocked is of doing something fact, America think or I want we body and areas let was see the the I of than industry. it are seen are – HEICO. in whole so body said, don’t I on recovery I going asking narrow I we And words that, narrow America have the clearly, as a out. me, as it recover well. there quicker Yes. the I’m North North But I at last pace to Greg, of in I extremely frankly, don’t remember data call much used. come think matter am And I’d the to remember call I the that. And was recovery. like – I haven’t And before if that Sheila and But And recall recovering exact And recovered XXXX? a did rather of

but the North I fully center obviously But America strength. optimistic. very Europe I’m is is body is that of recovered. narrow recovering, the mean, the yes, So strength, it hasn’t

struggling. is Asia still

It’s America itching more is just recovering. yes, process North Europe. are to like fly. of the sort South Americans in But of

we’re very think doing I well in market. that So

second supplementals just up in I of fiscal defense expect commentary of about place you it’s is the you with tick in opening some – supply I expect talked one how in to year, And the half the some any up industry tick the expected to the of your leaking of maybe maybe the kind weakness even with or half second overall of kind being think year? alleviated Ukraine. remarks, in defense year. the then chain you for commentary to And of booking your getting being overall, improve and line the to the maybe Victor. from half had tied in peers second conversion In that the budget would you mean whether

year Greg, very usual. is generally more the be Yes. months six just be half there One XX going in this healthy But than to I’m year encouraged back because by bookings. months. I right, this the would months, we been have surprises cautious of have the on last six think

just it all and to I’m falls sure. not I’m And but see prefer not be I out. wait to trying how So evasive,

year. clean for just then And quick a interest the for any the rate plus up I non-controlling question tax to Carlos. mean, update

NCI comment. I about my XX%. you should we to for tax as Hey, rate between exempt in Greg, Larry insurances XX% life and The mentioned we tax give a declines rate X% hold I’ll cleanup in expect our comments, be tax market headwind his securities in on had adversely wild rate rate a market card. keeps our down XX% in of pre-tax The somewhere products. and anywhere I’m as of in of That’s tax between income could and going right X% XX% rate. expecting, NCI a affect income, let’s from to now. that say percentage X% pre-tax

you. Thank

You’re welcome.

Olympic Your next question Global. is from Skibitski from Peter

open. is line Your

my Hey, I’m hear traveling me you I’m mobile. and morning, good Hopefully on everyone. can

you hear well. can We

Great.

sales of into could like, down hypersonics. next we defense R&D DoD a wondering on was touched speed on I ahead space, you and a goes drill as ETG I’m wondering but just little efforts more Just generation if kind kind really of full also bit.

efforts do type new how of well be especially DoD are getting you’re these positioned aligned like efforts the You’ve in is R&D of of wondering like got where going? spend the F-XX Thanks. that you aircraft and procurement feel overall HEICO you with for areas well And areas. feel while. is funded NGA kind a lot some will money even just like a I’m

reliant that And the with the talk question, good we over about us business the tried in that is not where we’re feel tempo, offer future engineering. technology we’ve definitely years be areas growth this DoD a way we’re lot The the just and going. to trying and you’ve a aligned on of is very well It’s tech that heard higher operations Pete. to construct in such higher the and that solutions answer the

side you we’re and spending product R&D And money on so, saw, side. the development as

course over But we’re making those going about – would because time anticipate. that. difficult the very to The always continue yield very I I to feel of investments So good timing is results.

wondering, it one into your seems that in collar is blue there, amount and of labor group, like Maybe focused if sourcing areas. more just and seems the great. labor seeing wondering you’re appreciate it. group. would switch it U.S., for Okay, any I maybe I’m just that repair like one average of there be overhaul me, one if just last in trouble, the wage or over FSG. in I’m pressure tightness in an

to just any get So color there. you provide can wanted

offered come think terrible a in by We the that some and do don’t overhaul for them the have they more go can job Yes. frankly, the shape. market So HEICO more figure back? percentage pretty than saying, typically out to additional we as very question. sales. That’s openings in a does. good a total from much mistake. way money they able I obviously but been And repair over labor that they, is of very intensive we’ve hear unfortunately parts about actually oh, to please, environment, how I get about happy mean, the then I’ve good quickly extremely They, competitor operate money. we’ve think that they’ve feel back to we’re competitors heard our I people very doing people And please, amount autonomy done. well. their gotten and That of And in same treated stories I work I and made who They’re about jobs. the very, it appreciated. in were

watching costs in take of be and We’re people for them pretty are we There people our are we’re areas proud in very see that whole that if carefully. watching And And it, we’re that good take shape. openings success. of our there they're where we're that up, going frankly, our very, care very and we are it reason HEICO. at Yes. and sure to proactive and they're remain care making the we

that So we're area. in pretty good shape in

color. for Thanks the Great.

Thanks, you. Thank Pete.

Truist you. Securities. Esterline from Pete we have Thank this And

line Your open. is

this good morning. for am our Hey, I Ciarmoli morning. Michael on for Thanks questions. taking

at are levels First significant this just there couple customers that next to of any year? anticipating from so over you are quarters? any what of inventory seeing you ask restocking in might been you far activity see I customers, has airline And wanted the terms

Yeah.

So really anticipated it answer see do to-date. come to And I've asked because, that they is service. the see our is I return don't people would What question up. restocking

have get some that obviously they to So returned been aircraft require aircrafts those have there and parts. parked to been have service and

we their believe have that, what traditional seen we So but “restocking”. seen is haven't we

that coming people ways So different many and that's be from to what XX question I've – seems and back. different asked many, that's

So I believe case. that's the

business, seeing to trending? are then share And recovery offerings on All Build is ask increased interest going also that products Are from you how Great, increased seeing thanks. And on that just your translate forward? there? might into wanted specialty Spec I to sequential customers you your any right. market

specialty We're that's because that's of support more And doing said always lagging OEMs. be the we in really, area business really products. support that an would well we OEM where

of biz, our was our products, the have a leadership two thanked of team want operate were and were ago, airlines not said, wanted we cut borders, fleeted they business. delivering a businesses they absolutely to new two partner ago, And really And I terrible. aircraft, me look specialty you aircraft. one and employment were decentralized with because visiting years didn't the them So our I chunk anecdote. about because tell to Things weeks looking structure. were we little who and said, they I owns canceling his know, into customers a you where

no You what, not begging you we can do do to you need it going the that, maintain but about if team, can able this do they you want, the don't please business, them because onto wouldn't I okay. we be it's we am your business they the them. now company are way to without to to we their people, that And so to be is have disagree to hit service call the were is order they need me out if people those followed leadership And on this never surging. thankful that anything. and rebound. do say of team to advice, afraid in this need going with me I And have run we're to going been We don't there's there. they have worry able take. hung people, we're that to And It's way that. And they said –

we're not do numbers the of to – is people we upside more that strategy the the and why And there. that's are come can at they HEICO, that think where way we're the I So right. are so Everything game long I on our debt. there's frankly, only we is think, course treat and loaded with

Great. color. for Thanks a the lot

Thank you.

Louis UBS. And from from question Raffetto your we next have

open. line Your is

Thank you. guys. Good morning

Louis. morning, Good

ETG I'm a of FSG? a… Carlos, couple go a ones. there that or was accrued was gonna to focused with think I consideration The you in first just, contingent quick

discount that in quarter. both the pretty that company, The discount Sure. on from rate went of a by is bit segments the from X% evenly. benefit so little X% to There's incremental benefit in was we while. the rate volume an between a X% to which a seen haven't average and split for That did up us way, the liabilities have for

liabilities you why statement, discounted. those rise, And $X.X cash get rates the as So in million. see that the or flow $X.X that's million

that Perfect. activities you. in I $XX makes guess curious under just outflow That sense. was a a was And investing $X the, was? other million, million what Thank there similarly then

line related of majority almost we're on that a with. product deposit to was The a complete Yeah. acquisition that

line deposit. we we're work, you to outflow. reasons, small that That's investigative investing timely why and it come still as in it's We're buy. a made for so And see doing an product some activities but looking

then Eric, you. I'm Perfect. And to Thank going right. back go to you. All

any heard on a increases sort the bit cost of guess bit increases, mismatch in of of little versus I of a goodness mix, that the some So I you was but there's anything from margin, some a quarter like bad reversals old maybe pricing one-time, on or few, debt so of of of reserves ago? said that no I a expenses years no those or inventory couple there's know

really and I clean you people our I'm the all is proud and I time. something this about is about all that. HEICO which am it with glad This mentioned No, talk

charges, it who decisions to not, numbers repositioned, done all these HEICO that. of history look operating of not never And did receivables, you wrote order the do charges. uneconomical where that If of sorts there our took in these make if inventory, them business. you goose short-term sorts And peers, stuff, if never did they out that. our big look peers one-time most off they supports they of are There HEICO that, at we've there, out without does taking all one-time in all this earn, of people our at

it And cost no, was we question, inventory our increases to a your something reversal we've not along answer that and we've like very I far as as to pricing pass been, sure as that. of goes been So or or our we make said, maintain careful margins. receivables

pricing due it’d sales at went when And I to costs been we to where not areas yes, going where think – some plenty cost, we due be a mismatch to a because inventory incorrect had able higher were don't lower are of other in think I up. were contracts to that costs, there So there prices you higher are there's that sales realize areas able of costs also prices we say up. tell I terms and that but realize can there to

I draw wouldn't a So environment. driven that I mean, that. operating because conclusion in our were that lean we're very of margins

hard. exceptionally are Our people working

benefit margins. I we're flow so think really our cost through COVID seeing that lower the than base that's coming of out is and it was the

guess times? went on brakes it, it if XX Appreciate sort I color. Larry, you, of had you XX was it's at not looked point great maybe and for Eric. That's business, right. something that All guys at Is recent then worth And just obviously a a one Eric's uneconomical out for deal times.

at he is it is answer paying high buy are a I we the I that anything it's buyer. I XX on god think for let comment Look, If times. price, him we to bless mean, or up people really pretty it. XX times work but paying that the some think don't look makes things him,

style, accretive. something to real but moon. XX, the we these don't a not you know, going buy that's conservative question and time live the, deals buying are do I we'll can't XX of much reach XX more wait historically The company? because get we'll we news. We what So do sort can't we That accretion like is our payback to hindsight, our investment. of acquisition mean, we're and good the companies, my in did basically up opinion And, Remember that very buy XX weeds, on or the that for years yesterday's shareholders that's that. in the to gets in we're the larger lost

I question think much for model. worth, I if good else not but do that's, pay to mean, it? it, wants the that's be is, But our how very happen companies, So somebody they they're to buy you

I to busy. very know, And thing people add would competitive for this that something if other busy acquisitions. the sale, and experts many of but XX% And say, We roughly Eric in there's Louis, acquisitions that is we're pig with we're we got should are and general, by careful I a paying most poke companies, One to release that, good I the for pay have I learned, buyer is are focus higher makes price, someone’s focus in see see very obviously very prices, sense acquisitions, HEICO. good in we’ve But would realizing everything, for a got lot announce do other out on priorities to been got path I Wall for failed. press which what most I – successful, the be we’ve told meaningful puts we’re to bought is have probably most want of And the but a to which really a if HEICO. XX% of sale. various a thing Street but stuck. that got value, M&A to nobody mean, go-to and in the really acquisitions they of we’ve we

I’m politically that made way correct. I not And acquisitions telling really So I has what HEICO you knows I’m know world that’s don’t XX% M&A the and the believe. that roughly of work.

to the you see My to investors’ and theory our salary money greater So fool die line. to I before And XX because money forth. hard into buy see to get wait $X I’m back. I and the double so my I from is money payback to years million not going want want my on family’s million $X and

multiple thing investors it what So at, And we that the look that’s HEICO that market to way is, do. of run and lot us is appreciate we if acceptance HEICO structured. investors letter morning And you the at sell the make but of we I’ve I other a notes way them email don’t thank by have earnings. letters this the the you how appreciate company. the sent they saying incredible public, today, the gotten on get many want we appears

I were And would the so in XX or back absolutely going or backlog they like in we XX money But case, or cash And whatever trailing. a not pay to our that, seven we that we that again, the we something example future get flow. pay might pay XX. say, strong XX. if where convinced orders would that have want And heard you’ve being we’re nine to how or me on XX to general, XX at or years. within support There’s one hopefully get that’s

not come banks X%. when debt. We’re and to neck calls don’t up debt sell don’t from around, we times tough have get our at to into And we

I our that does question? strategy. your that’s So, And mean, answer

the honesty. Yes, we appreciate

with Do me? you disagree or you agree it do with

been. over No. XX and the one disagree no you’ve Larry, how there family successful with the – what years what can last built has it’s

answer. That’s the right

Thank you.

Thanks, Louis.

your have [Operator Cowen. Instructions] from We question Gautam Khanna next from

open. line Your is

change PMA curious all in the you’ve just taking that over follow-up. of last for at Thanks years? parts was your pace Yes. if the I approvals FAA couple changed pipeline, any for seen the has

has It changed. No. not

overkill think the to make and I who development do to years a confidence sure one probably money that a and internally have And way, we HEICO PMA We People a of pace that. of us that’s add great the lot we we we correct at built engineers with and very come of accurate, they’re relationship. us we’re very And to good continues. and have to to we investment. bit going and color. have more to the and cost look approvals go over analysis By that’s of other run I’m believe doing Our other see really said good very our that up good there. a extremes how parts

too, the so go the and forth. think to understands I which and to extent the we duplication FAA the develop that parts that and detail

sell that’s think the – don’t has it on can’t we DNA. remember And in So get something and And HEICO in to right. and quality that’s quality go to the develop sell spacecrafts junk our work. electronics We general, I parts.

We have everything that and have else. and to engines aircraft parts work

And So we quality important quality. very, to is absolutely that number one. very us. get And to will that’s overspend

any the you from and slowdown, a That’s in normal helpful. remind you FSG year region? us in just much have of And curious to if other then just, sales derived how market? Chinese quarter maybe you And given Eric, lockdowns are the could I’m saw related what that

for China. any are reasons in We in market sites I would sell in don’t but we competitive not do we fine. we’re just disclose China, China. say active and manufacturing into Yes, we active have are doing that We and

buy? see they traffic [ph] And or any slowdown did continuing quarter were the to air the in to you related

by am units. reply because I to need I that to to reluctant it business really study

can you opinion. wouldn’t Sometimes you want I the form to have, wrong

Sometimes quarter in inventory a another. big lumpy one sales due to or be purchase can

looking I So at the get that say China market from you to looking wouldn’t quarter really could a sense in the one other.

that as result that? just, you high level Fair of a any guys on sort a will be have view enough. maybe exposure, then i.e., do And lost sales of Ukraine-Russia

Yes. This is the in Victor. Ukraine We did some Russia sales ETG. have and in

X% that’s the of So for ongoing sort I probably an neighborhood something headwind, in maybe sales is total us. not it’s of a it’s kind I actually like of potential, overwhelming, basis that. of headwind on mean, think

would I Support, similar. the would Flight does, within And say the the group be numbers

guys. you very Thank Great. much

you. Thank

And speakers Please go there will for remarks. back to call questions. the are ahead. the I further no more turn

you call, will speaking when middle we be you we be to third to try in And earnings Larry late do very Mendelson, forward with call satisfy where and I August. for at able excellent your to which look been hope in answers, the a you we’ve We’ll responsive. reach long questions. of time. our to us, been call It’s with I is sometime any thank interest lot HEICO. give if quarter not This a us again. to a

a market to you stock is with this strong very, and end of return. call So the that, the good we and wish day hopefully very a

participating. call. today’s for you concludes This all you. Thank Thank

You may now disconnect.