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Apr 30, 2020
Heico Q2 2020 Earnings Report
Net sales and operating income decreased due to the impact of the COVID-19 outbreak, while cash flow remained strong.
Key Takeaways
HEICO Corporation reported a decrease in net sales and operating income for the second quarter of fiscal 2020, primarily due to the impact of the COVID-19 outbreak on the commercial aerospace industry. Net income decreased by 8% to $75.5 million, and operating income decreased by 9% to $108.2 million. However, cash flow from operations remained strong.
Net income decreased 8% to $75.5 million, or 55 cents per diluted share.
Operating income decreased 9% to $108.2 million.
Net sales decreased 9% to $468.1 million.
EBITDA decreased 9% to $130.0 million.
Revenue by Segment
Forward Guidance
HEICO expects positive cash flow from operations for the remainder of fiscal 2020, but withdrew its fiscal 2020 financial guidance due to the impact of the Outbreak.
Positive Outlook
- Cost savings will most likely be a priority for commercial aviation customers once commercial air travel resumes.
- Demand for favorably priced commercial aviation products and services will return in advance of the overall market recovery.
- Cost-saving solutions and robust product development programs will enable HEICO to potentially increase market share.
- HEICO has no significant debt maturities until fiscal 2023.
- HEICO plans to utilize its financial strength and flexibility to aggressively pursue high quality acquisitions of various sizes.
Challenges Ahead
- The COVID-19 outbreak has caused significant volatility and a substantial decline in value across global economic markets.
- The commercial aerospace industry has experienced an ongoing substantial decline in demand.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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