Company: HEI-A
Filing Date: 2025-08-27
Form Type: 10-Q
Source: 0000046619-25-000062
Chunk: 57

Company: HEICO CORP
Filing Date: 2025-08-27
Form: 10-Q
Item: Item 8
Chunk 57
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ross Profit and Operating Expenses

Our consolidated gross profit margin improved to 39.8% in the third quarter of fiscal 2025, up from 39.2% in the third quarter of fiscal 2024 principally reflecting a 1.4% increase in the FSG’s gross profit margin, partially offset by a .4% decrease in the ETG's gross profit margin.  The increase in the FSG's gross profit margin principally reflects the previously mentioned net sales growth within its repair and overhaul parts and services and specialty products product lines.  The decrease in the ETG's gross profit margin principally reflects the previously mentioned decrease in net sales of medical products and a less favorable product mix of defense products, partially offset by higher net sales of aerospace and other electronics products.  Total new product research and development expenses included within our consolidated cost of sales were $31.9 million in the third quarter of fiscal 2025, up from $29.8 million in the third quarter of fiscal 2024.

Our consolidated SG&A expenses were $192.1 million in the third quarter of fiscal 2025, as compared to $172.8 million in the third quarter of fiscal 2024.  The increase in consolidated SG&A expenses principally reflects $9.2 million attributable to our fiscal 2025 and 2024 acquisitions, as well as higher general and administrative expenses and selling expenses of $6.0 million and $4.1 million, respectively, mainly to support the previously mentioned net sales growth.

Our consolidated SG&A expenses as a percentage of net sales improved to 16.7% in the third quarter of fiscal 2025, down from 17.4% in the third quarter of fiscal 2024.  The decrease in consolidated SG&A expenses as a percentage of net sales principally reflects efficiencies realized from the previously mentioned net sales growth.

Operating Income

Our consolidated operating income increased by 22% to a record $265.0 million in the third quarter of fiscal 2025, up from $216.4 million in the third quarter of fiscal 2024.  The increase in consolidated operating income principally reflects a $44.7 million increase (a 29% increase) to a record $198.3 million in operating income of the FSG and a $5.2 million increase (a 7% increase) to $81.0 million in operating income of the ETG.  The increase in operating income of the FSG principally reflects the previously mentioned net sales growth