Company: HEI-A
Filing Date: 2025-05-29
Form Type: 10-Q
Source: 0000046619-25-000046
Chunk: 70

Company: HEICO CORP
Filing Date: 2025-05-29
Form: 10-Q
Item: Item 2
Chunk 70
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 3% increase) to $77.9 million in operating income of the ETG.  The increase in operating income of the FSG principally reflects the previously mentioned net sales growth and improved gross profit margin, partially offset by a $9.9 million impact from changes in the estimated fair value of accrued contingent consideration.  The increase in operating income of the ETG principally reflects the previously mentioned net sales growth and SG&A expense efficiencies realized from the net sales growth, partially offset by the previously mentioned lower gross profit margin.

Our consolidated operating income as a percentage of net sales improved to 22.6% in the second quarter of fiscal 2025, up from 21.9% in the second quarter of fiscal 2024.  The increase in consolidated operating income as a percentage of net sales principally reflects an increase in 

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the FSG’s operating income as a percentage of net sales to 24.1% in the second quarter of fiscal 2025, up from 23.0% in the second quarter of fiscal 2024, partially offset by a decrease in the ETG's operating income as a percentage of net sales to 22.8% in the second quarter of fiscal 2025, as compared to 23.6% in the second quarter of fiscal 2024.  The increase in the FSG's operating income as a percentage of net sales principally reflects the previously mentioned improved gross profit margin, partially offset by a 1.0% impact from an increase in SG&A expenses as a percentage of net sales, primarily driven by the previously mentioned changes in the estimated fair value of accrued contingent consideration.  The decrease in the ETG's operating income as a percentage of net sales principally reflects the previously mentioned lower gross profit margin, partially offset by a .6% impact from lower SG&A expenses as a percentage of net sales, primarily driven by the previously mentioned efficiencies.

Interest Expense

Interest expense decreased to $32.9 million in the second quarter of fiscal 2025, down from $38.5 million in the second quarter of fiscal 2024.  The decrease in interest expense was principally due to a decrease in the amount of outstanding debt and a lower weighted-average interest rate on borrowings outstanding under our revolving credit facility.

Other Income

Other income in the second quarter of fiscal 2025 and 2024 was not material.

Income Tax Expense

Our effective tax rate decreased to 21.0% in the second quarter of fiscal 2025, down from