DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - $ / shares | 3 Months Ended | |
Jul. 31, 2020 | Aug. 25, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Shell Company | false | |
Local Phone Number | 987-4000 | |
Entity File Number | 001-04604 | |
City Area Code | 954 | |
Entity Interactive Data Current | Yes | |
Amendment Flag | false | |
Document Period End Date | Jul. 31, 2020 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Entity Current Reporting Status | Yes | |
Entity Information [Line Items] | ||
Entity Incorporation, State or Country Code | FL | |
Entity Registrant Name | HEICO CORPORATION | |
Address | 3000 Taft Street | |
Entity Address, City or Town | Hollywood | |
State | FL | |
Zip Code | 33021 | |
Entity Central Index Key | 0000046619 | |
Entity Tax Identification Number | 65-0341002 | |
Current Fiscal Year End Date | --10-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Heico Common Stock [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $.01 par value per share | |
Security Exchange Name | NYSE | |
Trading Symbol | HEI | |
Entity Common Stock, Shares Outstanding | 54,189,223 | |
Entity Common Stock Par Value | $ 0.01 | |
Common Class A [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Class A Common Stock, $.01 par value per share | |
Security Exchange Name | NYSE | |
Trading Symbol | HEI.A | |
Entity Common Stock, Shares Outstanding | 80,753,663 | |
Entity Common Stock Par Value | $ 0.01 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 395,278 | $ 57,001 |
Accounts receivable, net | 181,134 | 274,326 |
Contract assets | 59,113 | 43,132 |
Inventories, net | 473,104 | 420,319 |
Prepaid expenses and other current assets | 32,115 | 18,953 |
Total current assets | 1,140,744 | 813,731 |
Property, plant and equipment, net | 170,340 | 173,345 |
Goodwill | 1,320,047 | 1,268,703 |
Intangible assets, net | 542,674 | 550,693 |
Other assets | 249,445 | 162,739 |
Total assets | 3,423,250 | 2,969,211 |
Current liabilities: | ||
Current maturities of long-term debt | 1,073 | 906 |
Trade accounts payable | 80,548 | 106,225 |
Accrued expenses and other current liabilities | 146,288 | 178,957 |
Income taxes payable | 1,733 | 3,050 |
Total current liabilities | 229,642 | 289,138 |
Long-term debt, net of current maturities | 739,016 | 561,049 |
Deferred income taxes | 45,869 | 51,496 |
Other long-term liabilities | 252,372 | 184,604 |
Total liabilities | 1,266,899 | 1,086,287 |
Commitments and contingencies | ||
Redeemable noncontrolling interests | 204,139 | 188,264 |
Shareholders' equity: | ||
Preferred Stock, $.01 par value per share; 10,000 shares authorized; none issued | 0 | 0 |
Common Stock | 542 | 541 |
Capital in excess of par value | 301,532 | 284,609 |
Deferred compensation obligation | 4,232 | 4,232 |
HEICO stock held by irrevocable trust | (4,232) | (4,232) |
Accumulated other comprehensive loss | (4,451) | (16,739) |
Retained earnings | 1,623,285 | 1,397,327 |
Total HEICO shareholders' equity | 1,921,715 | 1,666,542 |
Noncontrolling interests | 30,497 | 28,118 |
Total shareholders' equity | 1,952,212 | 1,694,660 |
Total liabilities and equity | 3,423,250 | 2,969,211 |
Class A Common Stock [Member] | ||
Shareholders' equity: | ||
Common Stock | $ 807 | $ 804 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED [PARENTHETICAL] - $ / shares shares in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 10,000 | 10,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000 | 150,000 |
Common stock, shares issued | 54,189 | 54,143 |
Common stock, shares outstanding | 54,189 | 54,143 |
Class A Common Stock [Member] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 150,000 | 150,000 |
Common stock, shares issued | 80,741 | 80,353 |
Common stock, shares outstanding | 80,741 | 80,353 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Net sales | $ 386,410 | $ 532,324 | $ 1,360,831 | $ 1,514,118 |
Operating costs and expenses: | ||||
Cost of sales | 242,927 | 319,493 | 840,411 | 909,663 |
Selling, general and administrative expenses | 75,049 | 93,417 | 232,835 | 267,911 |
Total operating costs and expenses | 317,976 | 412,910 | 1,073,246 | 1,177,574 |
Operating income | 68,434 | 119,414 | 287,585 | 336,544 |
Interest expense | (2,602) | (5,523) | (10,644) | (16,496) |
Other (expense) income | 632 | 268 | 934 | 2,420 |
Income before income taxes and noncontrolling interests | 66,464 | 114,159 | 277,875 | 322,468 |
Income tax expense | 8,900 | 25,100 | 9,600 | 55,300 |
Net income from consolidated operations | 57,564 | 89,059 | 268,275 | 267,168 |
Less: Net income attributable to noncontrolling interests | 3,248 | 7,961 | 16,618 | 24,956 |
Net income attributable to HEICO | $ 54,316 | $ 81,098 | $ 251,657 | $ 242,212 |
Net income per share attributable to HEICO shareholders: | ||||
Basic (in dollars per share) | $ 0.40 | $ 0.61 | $ 1.87 | $ 1.82 |
Diluted (in dollars per share) | $ 0.40 | $ 0.59 | $ 1.83 | $ 1.76 |
Weighted average number of common shares outstanding: | ||||
Basic (in shares) | 134,837 | 133,970 | 134,676 | 133,405 |
Diluted (in shares) | 137,234 | 137,634 | 137,257 | 137,273 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Net income from consolidated operations | $ 57,564 | $ 89,059 | $ 268,275 | $ 267,168 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | 20,133 | (532) | 12,734 | (1,794) |
Amortization of unrealized loss on defined benefit pension plan, net of tax | 21 | 6 | 60 | 18 |
Total other comprehensive income (loss) | 20,154 | (526) | 12,794 | (1,776) |
Comprehensive income from consolidated operations | 77,718 | 88,533 | 281,069 | 265,392 |
Less: Comprehensive income attributable to noncontrolling interests | 3,248 | 7,961 | 16,618 | 24,956 |
Less: Foreign currency translation adjustments attributable to noncontrolling interests | 801 | (95) | 506 | (249) |
Comprehensive income attributable to noncontrolling interests | 4,049 | 7,866 | 17,124 | 24,707 |
Comprehensive income attributable to HEICO | $ 73,669 | $ 80,667 | $ 263,945 | $ 240,685 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME - UNAUDITED - USD ($) $ in Thousands | Total | Redeemable Noncontrolling Interests [Member] | Redeemable Noncontrolling Interests [Member]Cumulative Effect, Period of Adoption, Adjustment | Common Stock [Member] | Common Stock [Member]Class A Common Stock [Member] | Capital In Excess Of Par Value [Member] | Deferred Compensation Obligation [Member] | HEICO Stock Held By Irrevocable Trust [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Retained Earnings [Member]Cumulative Effect, Period of Adoption, Adjustment | Noncontrolling Interest [Member] | Noncontrolling Interest [Member]Cumulative Effect, Period of Adoption, Adjustment | Total Shareholders Equity [Member] | Total Shareholders Equity [Member]Cumulative Effect, Period of Adoption, Adjustment |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 534 | $ 796 | $ 320,994 | $ 3,928 | $ (3,928) | $ (15,256) | $ 1,091,183 | $ 104,757 | $ 1,503,008 | ||||||
Beginning Balance at Oct. 31, 2018 | 534 | 796 | 320,994 | 3,928 | (3,928) | (15,256) | 1,091,183 | 104,757 | 1,503,008 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 538 | 803 | 309,058 | 3,429 | (3,429) | (16,783) | 1,322,383 | 26,376 | 1,642,375 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | Accounting Standards Update 2014-09 [Member] | $ 13,373 | $ 326 | $ 13,699 | ||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent | $ 240,685 | (1,527) | 242,212 | ||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 24,707 | $ 13,232 | 11,475 | ||||||||||||
Comprehensive income | 265,392 | 252,160 | |||||||||||||
Cash dividends | (18,691) | (18,691) | |||||||||||||
Issuance of common stock to Savings and Investment Plan | 7,656 | 7,656 | |||||||||||||
Share-based compensation expense | 7,674 | 7,674 | |||||||||||||
Proceeds from stock option exercises | 7 | 8 | 8,270 | ||||||||||||
Proceeds from stock option exercises, Adjustment to Additional Paid in Capital | 8,255 | ||||||||||||||
Stock Redeemed or Called During Period, Value | (3) | (1) | (35,596) | (35,600) | |||||||||||
Distributions to noncontrolling interests | (12,134) | (92,565) | (92,565) | ||||||||||||
Noncontrolling Interest, Increase from Business Combination | 38,696 | 2,382 | 2,382 | ||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 5,694 | (5,694) | (5,694) | ||||||||||||
Deferred compensation obligation | (499) | ||||||||||||||
Stock Issued During Period Value Deferred Compensation Obligation | 499 | ||||||||||||||
Stockholders' Equity, Other | 1 | 76 | |||||||||||||
Adjustments to Additional Paid in Capital, Other | 75 | ||||||||||||||
Ending Balance at Jul. 31, 2019 | 538 | 803 | 309,058 | 3,429 | (3,429) | (16,783) | 1,322,383 | 26,376 | 1,642,375 | ||||||
Ending Balance (Accounting Standards Update 2014-09 [Member]) at Jul. 31, 2019 | 13,373 | 326 | 13,699 | ||||||||||||
Starting Balance, Redeemable Noncontrolling Interests at Oct. 31, 2018 | 132,046 | ||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 24,707 | 13,232 | 11,475 | ||||||||||||
Distributions to noncontrolling interests | (12,134) | (92,565) | (92,565) | ||||||||||||
Noncontrolling Interest, Increase from Business Combination | 38,696 | 2,382 | 2,382 | ||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 5,694 | (5,694) | (5,694) | ||||||||||||
Ending Balance, Redeemable Noncontrolling Interests at Jul. 31, 2019 | 178,353 | ||||||||||||||
Ending Balance, Redeemable Noncontrolling Interests (Accounting Standards Update 2014-09 [Member]) at Jul. 31, 2019 | $ 819 | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 538 | 800 | 310,201 | 4,043 | (4,043) | (16,352) | 1,251,699 | 115,278 | 1,662,164 | ||||||
Beginning Balance at Apr. 30, 2019 | 538 | 800 | 310,201 | 4,043 | (4,043) | (16,352) | 1,251,699 | 115,278 | 1,662,164 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 538 | 803 | 309,058 | 3,429 | (4,043) | (16,352) | 1,251,699 | 115,278 | 1,662,164 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | Accounting Standards Update 2014-09 [Member] | 13,373 | 326 | 13,699 | ||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent | 80,667 | (431) | 81,098 | ||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 7,866 | 5,008 | 2,858 | ||||||||||||
Comprehensive income | 88,533 | 83,525 | |||||||||||||
Cash dividends | (9,386) | (9,386) | |||||||||||||
Issuance of common stock to Savings and Investment Plan | 1,266 | 1,266 | |||||||||||||
Share-based compensation expense | 2,687 | 2,687 | |||||||||||||
Proceeds from stock option exercises | 4 | 2,742 | |||||||||||||
Proceeds from stock option exercises, Adjustment to Additional Paid in Capital | 2,738 | ||||||||||||||
Stock Redeemed or Called During Period, Value | (1) | (7,855) | (7,856) | ||||||||||||
Distributions to noncontrolling interests | (4,750) | (91,759) | (91,759) | ||||||||||||
Noncontrolling Interest, Increase from Business Combination | 25,617 | ||||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 1,028 | (1,028) | (1,028) | ||||||||||||
Deferred compensation obligation | (614) | ||||||||||||||
Stock Issued During Period Value Deferred Compensation Obligation | 614 | ||||||||||||||
Stockholders' Equity, Other | (1) | 20 | |||||||||||||
Adjustments to Additional Paid in Capital, Other | 21 | ||||||||||||||
Ending Balance at Jul. 31, 2019 | 538 | 803 | 309,058 | 3,429 | (3,429) | (16,783) | 1,322,383 | 26,376 | 1,642,375 | ||||||
Ending Balance (Accounting Standards Update 2014-09 [Member]) at Jul. 31, 2019 | 13,373 | 326 | 13,699 | ||||||||||||
Starting Balance, Redeemable Noncontrolling Interests at Apr. 30, 2019 | 151,450 | ||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 7,866 | 5,008 | 2,858 | ||||||||||||
Distributions to noncontrolling interests | (4,750) | (91,759) | (91,759) | ||||||||||||
Noncontrolling Interest, Increase from Business Combination | 25,617 | ||||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 1,028 | (1,028) | (1,028) | ||||||||||||
Ending Balance, Redeemable Noncontrolling Interests at Jul. 31, 2019 | 178,353 | ||||||||||||||
Ending Balance, Redeemable Noncontrolling Interests (Accounting Standards Update 2014-09 [Member]) at Jul. 31, 2019 | $ 819 | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 538 | 803 | 309,058 | 3,429 | (3,429) | (16,783) | 1,322,383 | 26,376 | 1,642,375 | ||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | Accounting Standards Update 2014-09 [Member] | $ 13,373 | $ 326 | $ 13,699 | ||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 1,694,660 | 541 | 804 | 284,609 | 4,232 | (4,232) | (16,739) | 1,397,327 | 28,118 | 1,694,660 | |||||
Beginning Balance at Oct. 31, 2019 | 1,694,660 | 541 | 804 | 284,609 | 4,232 | (4,232) | (16,739) | 1,397,327 | 28,118 | 1,694,660 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 1,694,660 | 542 | 807 | 301,532 | 4,232 | (4,232) | (4,451) | 1,623,285 | 30,497 | 1,952,212 | |||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent | 263,945 | 12,288 | 251,657 | ||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 17,124 | 12,556 | 4,568 | ||||||||||||
Comprehensive income | 281,069 | 268,513 | |||||||||||||
Cash dividends | (21,552) | (21,552) | |||||||||||||
Issuance of common stock to Savings and Investment Plan | 1 | 8,575 | 8,576 | ||||||||||||
Share-based compensation expense | 7,775 | 7,775 | |||||||||||||
Proceeds from stock option exercises | 4 | 5,345 | |||||||||||||
Proceeds from stock option exercises, Adjustment to Additional Paid in Capital | 5,341 | ||||||||||||||
Stock Redeemed or Called During Period, Value | (1) | (5,329) | (5,330) | ||||||||||||
Distributions to noncontrolling interests | (11,240) | (947) | (947) | ||||||||||||
Noncontrolling Interest, Increase from Business Combination | 16,471 | ||||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 4,147 | (4,147) | (4,147) | ||||||||||||
Stockholders' Equity, Other | (1,242) | (681) | |||||||||||||
Adjustments to Additional Paid in Capital, Other | 561 | ||||||||||||||
Ending Balance at Jul. 31, 2020 | 1,952,212 | 542 | 807 | 301,532 | 4,232 | (4,232) | (4,451) | 1,623,285 | 30,497 | 1,952,212 | |||||
Starting Balance, Redeemable Noncontrolling Interests at Oct. 31, 2019 | 188,264 | 188,264 | |||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 17,124 | 12,556 | 4,568 | ||||||||||||
Distributions to noncontrolling interests | (11,240) | (947) | (947) | ||||||||||||
Acquisitions of noncontrolling interests | (7,475) | ||||||||||||||
Noncontrolling Interest, Increase from Business Combination | 16,471 | ||||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 4,147 | (4,147) | (4,147) | ||||||||||||
Temporary Equity, Other Changes | 1,416 | ||||||||||||||
Ending Balance, Redeemable Noncontrolling Interests at Jul. 31, 2020 | 204,139 | 204,139 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 542 | 806 | 297,324 | 4,232 | (4,232) | (23,804) | 1,583,646 | 31,006 | 1,889,520 | ||||||
Beginning Balance at Apr. 30, 2020 | 542 | 806 | 297,324 | 4,232 | (4,232) | (23,804) | 1,583,646 | 31,006 | 1,889,520 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 1,952,212 | 542 | 807 | 297,324 | 4,232 | (4,232) | (23,804) | 1,583,646 | 30,497 | 1,952,212 | |||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent | 73,669 | 19,353 | 54,316 | ||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 4,049 | 3,134 | 915 | ||||||||||||
Comprehensive income | 77,718 | 74,584 | |||||||||||||
Cash dividends | (10,790) | (10,790) | |||||||||||||
Issuance of common stock to Savings and Investment Plan | 1 | 1,294 | 1,295 | ||||||||||||
Share-based compensation expense | 2,500 | 2,500 | |||||||||||||
Proceeds from stock option exercises | 2 | 2,953 | |||||||||||||
Proceeds from stock option exercises, Adjustment to Additional Paid in Capital | 2,951 | ||||||||||||||
Stock Redeemed or Called During Period, Value | (1) | (2,762) | (2,763) | ||||||||||||
Distributions to noncontrolling interests | (2,263) | (182) | (182) | ||||||||||||
Noncontrolling Interest, Increase from Business Combination | 8,933 | ||||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 3,887 | (3,887) | (3,887) | ||||||||||||
Stockholders' Equity, Other | (1) | (1,242) | (1,018) | ||||||||||||
Adjustments to Additional Paid in Capital, Other | 225 | ||||||||||||||
Ending Balance at Jul. 31, 2020 | 1,952,212 | 542 | 807 | 301,532 | 4,232 | (4,232) | (4,451) | 1,623,285 | 30,497 | 1,952,212 | |||||
Starting Balance, Redeemable Noncontrolling Interests at Apr. 30, 2020 | 196,507 | ||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | 4,049 | 3,134 | 915 | ||||||||||||
Distributions to noncontrolling interests | (2,263) | (182) | (182) | ||||||||||||
Acquisitions of noncontrolling interests | (7,475) | ||||||||||||||
Noncontrolling Interest, Increase from Business Combination | 8,933 | ||||||||||||||
Adjustments to redemption amount of redeemable noncontrolling interests | 3,887 | (3,887) | (3,887) | ||||||||||||
Temporary Equity, Other Changes | 1,416 | ||||||||||||||
Ending Balance, Redeemable Noncontrolling Interests at Jul. 31, 2020 | 204,139 | $ 204,139 | |||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 1,952,212 | $ 542 | $ 807 | $ 301,532 | $ 4,232 | $ (4,232) | $ (4,451) | $ 1,623,285 | $ 30,497 | $ 1,952,212 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME - UNAUDITED [PARENTHETICAL] - $ / shares | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Cash dividends per share (in dollars per share) | $ 0.080 | $ 0.070 | $ 0.160 | $ 0.140 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 31, 2020 | Jul. 31, 2019 | |
Operating Activities: | ||
Net income from consolidated operations | $ 268,275 | $ 267,168 |
Adjustments to reconcile net income from consolidated operations to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 65,218 | 61,686 |
Share-based compensation expense | 7,775 | 7,674 |
Employer contributions to HEICO Savings and Investment Plan | 7,452 | 7,128 |
Change in value of contingent consideration | 189 | 3,734 |
Deferred income tax provision (benefit) | (9,345) | (3,293) |
PaymentofContingentConsiderationinExcessofAcquisitionDateValue | (175) | (3,105) |
Changes in operating assets and liabilities, net of acquisitions: | ||
Change in accounts receivable | 96,258 | (14,820) |
Increase (Decrease) in Contract with Customer, Asset | (15,968) | 7,429 |
Change in inventories | (48,077) | (27,019) |
Change in prepaid expenses and other current assets | (12,724) | (1,343) |
Change in trade accounts payable | (25,434) | (11,783) |
Change in accrued expenses and other current liabilities | (45,990) | 8,797 |
Change in income taxes payable | (2,469) | 772 |
Increase (Decrease) in Obligation, Other Postretirement Benefits | 10,595 | 11,295 |
Other | 3,391 | (921) |
Net cash provided by operating activities | 298,971 | 313,399 |
Investing Activities: | ||
Acquisitions, net of cash acquired | (66,320) | (235,174) |
Capital expenditures | (17,472) | (21,671) |
Net Investment Related to Deferred Compensation Plan | (14,600) | (10,800) |
Other | 385 | 628 |
Net cash used in investing activities | (98,007) | (267,017) |
Financing Activities: | ||
Proceeds from Long-term Lines of Credit | 245,000 | 288,000 |
Payments on revolving credit facility | (68,000) | (180,000) |
Proceeds from stock option exercises | 5,345 | 8,270 |
Cash dividends paid | (21,552) | (18,691) |
Distributions to noncontrolling interests | (12,187) | (104,699) |
Common Stock Issued Repurchased and Retired Related To Stock Option Exercises | (5,330) | (35,600) |
Payments to Noncontrolling Interests | (7,475) | |
Payment of Contingent Consideration | (325) | (4,073) |
Other | (851) | (387) |
Net cash (used in) provided by financing activities | 134,625 | (47,180) |
Effect of exchange rate changes on cash | 2,688 | 222 |
Net (decrease) increase in cash and cash equivalents | 338,277 | (576) |
Cash and cash equivalents at beginning of year | 57,001 | 59,599 |
Cash and cash equivalents at end of period | $ 395,278 | $ 59,023 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Jul. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies [Text Block] | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements of HEICO Corporation and its subsidiaries (collectively, “HEICO,” or the “Company”) have been prepared in conformity with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q. Therefore, the condensed consolidated financial statements do not include all information and footnotes normally included in annual consolidated financial statements and should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended October 31, 2019. The October 31, 2019 Condensed Consolidated Balance Sheet has been derived from the Company’s audited consolidated financial statements. In the opinion of management, the unaudited condensed consolidated financial statements contain all adjustments (consisting principally of normal recurring accruals) necessary for a fair presentation of the condensed consolidated balance sheets, statements of operations, statements of comprehensive income, statements of shareholders' equity and statements of cash flows for such interim periods presented. The results of operations for the nine months ended July 31, 2020 are not necessarily indicative of the results which may be expected for the entire fiscal year. The Company has two operating segments: the Flight Support Group (“FSG”), consisting of HEICO Aerospace Holdings Corp. and HEICO Flight Support Corp. and their respective subsidiaries; and the Electronic Technologies Group (“ETG”), consisting of HEICO Electronic Technologies Corp. (“HEICO Electronic”) and its subsidiaries. The Company's results of operations for the nine and three months ended July 31, 2020 have been significantly affected by the COVID-19 outbreak, which is classified as a global pandemic (the “Outbreak”). The effects of the Outbreak and related actions by governments around the world to mitigate its spread have impacted the Company's employees, customers, suppliers and manufacturers. In response to the economic impact from the Outbreak, the Company has implemented certain cost reduction efforts, including layoffs, temporary reduced work hours and temporary pay reductions within various departments of its business, including within its executive management team and its Board of Directors. Additionally, the Company's response to the Outbreak has included the implementation of varying health and safety measures at its facilities, including: supplying and requiring the use of personal protective equipment; staggering work shifts; body temperature taking; increasing work-from-home capabilities; consistent and ongoing cleaning of work spaces and high-touch areas; and establishing processes aligned with the Centers for Disease and Control guidelines to work with any individual exposed to COVID-19 on their necessary quarantine period and the process for the individual to return to work. With respect to the Company's results of operations, approximately half of its net sales are derived from defense, space and other industrial markets including electronics, medical and telecommunications. Demand for products in that half of the Company's business has not been fundamentally impacted and its operational results remain materially consistent with financial expectations prior to the Outbreak. However, the Company has experienced, and expects to continue experiencing, periodic operational disruptions resulting from supply chain disturbances, staffing challenges - including at some of its customers, temporary facility closures, transportation interruptions and other conditions which slow production and orders, or increase costs. While these issues have not yet been material overall, the Company has experienced disruptions in some orders and shipments during the third quarter of fiscal 2020. The remaining portion of HEICO's net sales is derived from commercial aviation products and services. The Outbreak has caused significant volatility and a substantial decline in value across global markets. Most notably, the commercial aerospace industry experienced an ongoing substantial decline in demand resulting from a significant number of aircraft in the global fleet being grounded during HEICO's third quarter of fiscal 2020. The Company's businesses that operate within the commercial aerospace industry have been materially impacted by the significant decline in global commercial air travel that began in March 2020. Consolidated net sales for the Company's businesses that operate within the commercial aerospace industry decreased by approximately 54% during the third quarter of fiscal 2020. Once commercial air travel resumes, cost savings will most likely be a priority for HEICO's commercial aviation customers and the Company anticipates recovery in demand for its commercial aviation products, which frequently provide aircraft operators with significant savings. Furthermore, HEICO believes its cost-saving solutions and robust product development programs will enable it to potentially increase market share and emerge with a stronger presence within this market. As a result of the Outbreak, HEICO has assessed various accounting estimates, including those that require consideration of forecasted financial information, in context of the unknown future impacts of the Outbreak as of July 31, 2020 and through the date of filing this Quarterly Report. The accounting estimates assessed include, but were not limited to, the Company’s allowance for doubtful accounts, inventory reserves, contingent consideration arrangements, goodwill and other long-lived assets. Based on these assessments, no material impact was recorded to HEICO’s Condensed Consolidated Statement of Operations for the nine and three months ended July 31, 2020. Although not material, see Note 3, Selected Financial Statement Information - Accounts Receivable, for additional information pertaining to the increase in the Company's allowance for doubtful accounts principally due to bankruptcy filings by certain commercial aviation customers resulting from the financial impact of the Outbreak. Also, see Management's Discussion and Analysis of Financial Condition and Results of Operations for the related impact on bad debt expense. New Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, which, as amended, was codified as Accounting Standards Codification ("ASC") Topic 842, "Leases" ("ASC 842"). ASC 842 requires recognition of lease assets and lease liabilities on the balance sheet of lessees. The Company adopted ASC 842 as of November 1, 2019 using a modified retrospective transition approach with the election to apply the guidance as of the adoption date instead of at the beginning of the earliest comparative period presented. The adoption of this guidance resulted in an increase in the Company's assets and liabilities due to the recognition of right-of-use ("ROU") assets and corresponding lease liabilities for leases that are currently classified as operating leases. Upon adoption, the Company elected the package of transitional practical expedients, which allowed the Company to not reassess its prior conclusions about lease identification, lease classification, and initial direct costs. In addition, the Company elected the short-term lease practical expedient, which allows HEICO to not record an ROU asset and lease liability for any lease with a term of twelve months or less, and also elected the single component practical expedient for all asset classes, which allows the Company to include both lease and non-lease components associated with a lease as a single lease component when determining the value of the ROU asset and lease liability. The adoption of this guidance resulted in the Company recording ROU assets and corresponding lease liabilities of $63.4 million and $64.1 million, respectively, in the Company's Condensed Consolidated Balance Sheet. The adoption of ASC 842 did not have a material impact on the Company’s Condensed Consolidated Statement of Operations or Statement of Cash Flows. See Note 9, Leases, for additional information regarding the Company's accounting policy for leases and disclosures required by ASC 842. In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment," which is intended to simplify the current test for goodwill impairment by eliminating the second step in which the implied value of a reporting unit is calculated when the carrying value of the reporting unit exceeds its fair value. Under ASU 2017-04, goodwill impairment should be recognized for the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. ASU 2017-04 must be applied prospectively and is effective for any annual or interim goodwill impairment test in fiscal years beginning after December 15, 2019, or in fiscal 2021 for HEICO. Early adoption is permitted. The Company is currently evaluating the effect the adoption of this guidance will have on its consolidated results of operations, financial position and cash flows. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Jul. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisitions [Text Block] | ACQUISITIONS In June 2020, the Company, through HEICO Flight Support Corp., acquired 70% of the membership interests of Rocky Mountain Hydrostatics, LLC ("Rocky Mountain"). Rocky Mountain overhauls industrial pumps, motors, and other hydraulic units with a focus on the support of legacy systems for the U.S. Navy. The remaining 30% continues to be owned by certain members of Rocky Mountain's management team (see Note 3, Selected Financial Statement Information - Redeemable Noncontrolling Interests, for additional information). The purchase price of this acquisition was paid in cash using cash on hand. In May 2020, a subsidiary of HEICO Electronic obtained 100% ownership of the assets and liabilities of Freebird Semiconductor Corporation ("Freebird"), an entity in which the subsidiary held a controlling financial interest since November 2018. In June 2020, the HEICO Electronic subsidiary contributed the assets and liabilities of Freebird in exchange for a 49% equity interest in EPC Space LLC ("EPC”), which the Company accounts for under the equity method. As the fair value of the net assets contributed approximated the fair value of the equity interest received in EPC, no material gain or loss was recorded as a result of this transaction. EPC designs, develops, promotes, markets and sells radiation-hardened gallium nitride power solutions packaged for use in outer space and other high reliability applications. In December 2019, the Company, through a subsidiary of HEICO Electronic, acquired 100% of the business and assets of the Human-Machine Interface ("HMI") product line of Spectralux Corporation. HMI designs, manufactures, and repairs flight deck annunciators, panels, indicators, and illuminated keyboards, as well as lighting controls, and flight deck lighting. In December 2019, the Company, through HEICO Electronic, acquired 80.1% of the stock of Quell Corporation ("Quell"). Quell designs and manufactures electromagnetic interference (EMI)/radio-frequency interference (RFI) and transient protection solutions for a wide variety of connectors that principally serve customers within the aerospace and defense markets. The remaining 19.9% continues to be owned by certain members of Quell's management team (see Note 3, Selected Financial Statement Information - Redeemable Noncontrolling Interests, for additional information). The purchase price of the HMI and Quell acquisitions were paid in cash, principally using proceeds from the Company's revolving credit facility, and is not material or significant to the Company's condensed consolidated financial statements. The allocation of the total consideration for the fiscal 2020 acquisitions to the tangible and identifiable intangible assets acquired and liabilities and noncontrolling interests assumed is preliminary until the Company obtains final information regarding their fair values. However, the Company does not expect any adjustment to such allocations to be material to the Company's consolidated financial statements. The operating results of the fiscal 2020 acquisitions were included in the Company’s results of operations from each of the effective acquisition dates. The amount of net sales and earnings of the fiscal 2020 acquisitions included in the Condensed Consolidated Statement of Operations for the nine and three months ended July 31, 2020 is not material. Had the fiscal 2020 acquisitions |
SELECTED FINANCIAL STATEMENT IN
SELECTED FINANCIAL STATEMENT INFORMATION | 9 Months Ended |
Jul. 31, 2020 | |
Selected Financial Statement Information [Abstract] | |
Selected Financial Statement Information [Text Block] | SELECTED FINANCIAL STATEMENT INFORMATION Accounts Receivable (in thousands) July 31, 2020 October 31, 2019 Accounts receivable $193,173 $277,992 Less: Allowance for doubtful accounts (12,039) (3,666) Accounts receivable, net $181,134 $274,326 The $8.4 million increase in the Company’s allowance for doubtful accounts is principally due to potential collection difficulties from certain commercial aviation customers that filed for bankruptcy protection during the third quarter of fiscal 2020 as a result of the financial impact of the Outbreak. Inventories (in thousands) July 31, 2020 October 31, 2019 Finished products $241,895 $199,880 Work in process 39,777 32,548 Materials, parts, assemblies and supplies 191,432 187,891 Inventories, net of valuation reserves $473,104 $420,319 Property, Plant and Equipment (in thousands) July 31, 2020 October 31, 2019 Land $6,922 $6,820 Buildings and improvements 122,405 116,997 Machinery, equipment and tooling 264,900 253,127 Construction in progress 9,593 8,382 403,820 385,326 Less: Accumulated depreciation and amortization (233,480) (211,981) Property, plant and equipment, net $170,340 $173,345 Accrued Customer Rebates and Credits The aggregate amount of accrued customer rebates and credits included within accrued expenses and other current liabilities in the accompanying Condensed Consolidated Balance Sheets was $16.6 million as of July 31, 2020 and $18.0 million as of October 31, 2019. The total customer rebates and credits deducted within net sales for the nine months ended July 31, 2020 and 2019 was $4.3 million and $6.5 million, respectively. The total customer rebates and credits deducted within net sales for the three months ended July 31, 2020 and 2019 was $.5 million and $2.9 million, respectively. Research and Development Expenses The amount of new product research and development ("R&D") expenses included in cost of sales for the nine and three months ended July 31, 2020 and 2019 is as follows (in thousands): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 R&D expenses $48,968 $48,697 $15,113 $16,648 Redeemable Noncontrolling Interests The holders of equity interests in certain of the Company's subsidiaries have rights ("Put Rights") that may be exercised on varying dates causing the Company to purchase their equity interests through fiscal 2030. The Put Rights, all of which relate either to common shares or membership interests in limited liability companies, provide that the cash consideration to be paid for their equity interests (the "Redemption Amount") be at fair value or a formula that management intended to reasonably approximate fair value based solely on a multiple of future earnings over a measurement period. Management's estimate of the aggregate Redemption Amount of all Put Rights that the Company could be required to pay is as follows (in thousands): July 31, 2020 October 31, 2019 Redeemable at fair value $154,074 $136,611 Redeemable based on a multiple of future earnings 50,065 51,653 Redeemable noncontrolling interests $204,139 $188,264 As discussed in Note 2, Acquisitions, the Company, through HEICO Flight Support Corp., acquired 70% of the membership interests of Rocky Mountain in June 2020. As part of the operating agreement, the noncontrolling interest holders have the right to cause the Company to purchase their equity interest over a four-year period beginning in fiscal 2027, or sooner under certain conditions, and the Company has the right to purchase the same equity interest over the same period. As discussed in Note 2, Acquisitions, the Company, through HEICO Electronic, acquired 80.1% of the stock of Quell in December 2019. As part of the shareholders' agreement, the noncontrolling interest holders have the right to cause the Company to purchase their equity interests over a four-year period beginning in fiscal 2025, or sooner under certain conditions, and the Company has the right to purchase the same equity interests over the same period. During fiscal 2020, the holder of a 20% noncontrolling equity interest in a subsidiary of the FSG that was acquired in fiscal 2015 exercised their option to cause the Company to purchase one-fourth of their interest. The Company acquired the 5% noncontrolling interest in May 2020 which increased its ownership interest in the subsidiary to approximately 85%. In May 2020, the Company obtained control of the 22% noncontrolling equity interest in a subsidiary of the ETG that was acquired in fiscal 2012, which increased the Company's ownership interest in the subsidiary to 100%. During fiscal 2020, the holder of a 17.7% noncontrolling equity interest in a subsidiary of the FSG that was acquired in fiscal 2008 exercised their option to cause the Company to purchase a portion of their noncontrolling interest over a two-year period ending in fiscal 2021. In June 2020, the Company acquired half of such interest, which increased the Company's ownership interest in the subsidiary to 86.2%. The $7.5 million aggregate Redemption Amount for the redeemable noncontrolling interests acquired in fiscal 2020 was paid using cash provided by operating activities. Accumulated Other Comprehensive Loss Changes in the components of accumulated other comprehensive loss for the nine months ended July 31, 2020 are as follows (in thousands): Foreign Currency Translation Defined Benefit Pension Plan Accumulated Balances as of October 31, 2019 ($14,989) ($1,750) ($16,739) Unrealized gain 12,228 — 12,228 Amortization of unrealized loss — 60 60 Balances as of July 31, 2020 ($2,761) ($1,690) ($4,451) |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 9 Months Ended |
Jul. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure [Text Block] | GOODWILL AND OTHER INTANGIBLE ASSETS Changes in the carrying amount of goodwill by operating segment for the nine months ended July 31, 2020 are as follows (in thousands): Segment Consolidated Totals FSG ETG Balances as of October 31, 2019 $410,044 $858,659 $1,268,703 Goodwill acquired 14,986 34,589 49,575 Foreign currency translation adjustments 3,425 2,878 6,303 Deconsolidation of subsidiary — (4,249) (4,249) Adjustments to goodwill — (285) (285) Balances as of July 31, 2020 $428,455 $891,592 $1,320,047 The goodwill acquired pertains to the fiscal 2020 acquisitions described in Note 2, Acquisitions, and represents the residual value after the allocation of the total consideration to the tangible and identifiable intangible assets acquired and liabilities and noncontrolling interests assumed. Foreign currency translation adjustments are included in other comprehensive income (loss) in the Company's Condensed Consolidated Statements of Comprehensive Income. Deconsolidation of subsidiary reflects the value of goodwill associated with an entity that the Company previously consolidated but subsequently contributed the net assets of the former entity to a new entity in which the Company holds a noncontrolling interest and accounts for under the equity method (See Note 2, Acquisitions, for additional information). The adjustments to goodwill represent immaterial measurement period adjustments to the purchase price allocation of certain fiscal 2019 acquisitions. The Company estimates that $20 million of the goodwill acquired in fiscal 2020 will be deductible for income tax purposes. Identifiable intangible assets consist of the following (in thousands): As of July 31, 2020 As of October 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizing Assets: Customer relationships $426,423 ($189,469) $236,954 $411,076 ($162,722) $248,354 Intellectual property 225,396 (80,220) 145,176 216,359 (70,169) 146,190 Licenses 6,559 (4,529) 2,030 6,559 (4,102) 2,457 Patents 1,048 (732) 316 986 (666) 320 Non-compete agreements 810 (810) — 813 (813) — Trade names 450 (209) 241 450 (180) 270 660,686 (275,969) 384,717 636,243 (238,652) 397,591 Non-Amortizing Assets: Trade names 157,957 — 157,957 153,102 — 153,102 $818,643 ($275,969) $542,674 $789,345 ($238,652) $550,693 The increase in the gross carrying amount of customer relationships, intellectual property and trade names as of July 31, 2020 compared to October 31, 2019 principally relates to such intangible assets recognized in connection with the fiscal 2020 acquisitions (see Note 2, Acquisitions). Amortization expense related to intangible assets for the nine months ended July 31, 2020 and 2019 was $41.8 million and $39.6 million, respectively. Amortization expense related to intangible assets for the three months ended July 31, 2020 and 2019 was $14.2 million and $13.7 million, respectively. Amortization expense related to intangible assets for the remainder of fiscal 2020 is estimated to be $14.3 million. Amortization expense for each of the next five fiscal years and thereafter is estimated to be $54.8 million in fiscal 2021, $48.0 million in fiscal 2022, $42.5 million in fiscal 2023, $37.8 million in fiscal 2024, $33.5 million in fiscal 2025, and $153.8 million thereafter. |
LONG-TERM DEBT
LONG-TERM DEBT | 9 Months Ended |
Jul. 31, 2020 | |
Debt Disclosure [Abstract] | |
Long-term Debt [Text Block] | LONG-TERM DEBT Long-term debt consists of the following (in thousands): July 31, 2020 October 31, 2019 Borrowings under revolving credit facility $730,000 $553,000 Finance leases and note payable 10,089 8,955 740,089 561,955 Less: Current maturities of long-term debt (1,073) (906) $739,016 $561,049 |
REVENUE
REVENUE | 9 Months Ended |
Jul. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | REVENUE Contract Balances Contract assets (unbilled receivables) represent revenue recognized on contracts using an over-time recognition model in excess of amounts invoiced to the customer. Contract liabilities (deferred revenue) represent customer advances and billings in excess of revenue recognized and are included within accrued expenses and other current liabilities in the Company’s Condensed Consolidated Balance Sheets. Changes in the Company’s contract assets and liabilities for the nine months ended July 31, 2020 are as follows (in thousands): July 31, 2020 October 31, 2019 Change Contract assets $59,113 $43,132 $15,981 Contract liabilities 22,863 23,809 (946) Net contract assets $36,250 $19,323 $16,927 The increase in the Company's contract assets during the first nine months of fiscal 2020 occurred within the ETG and principally reflects additional unbilled receivables on certain customer contracts using an over-time recognition model in excess of billings on certain customer contracts. The amount of revenue that the Company recognized during the nine and three months ended July 31, 2020 that was included in contract liabilities as of the beginning of fiscal 2020 was $17.4 million and $.9 million, respectively. Remaining Performance Obligations As of July 31, 2020, the Company had $363.8 million of remaining performance obligations associated with contracts with an original duration of greater than one year pertaining to the majority of the products offered by the ETG as well as certain products of the FSG's specialty products and aftermarket replacement parts product lines. The Company will recognize net sales as these obligations are satisfied. The Company expects to recognize $84.3 million of this amount during the remainder of fiscal 2020 and $279.5 million thereafter, of which the majority is expected to occur in fiscal 2021. Contract Estimates Changes in estimates did not have a material effect on net income from consolidated operations for the nine and three months ended July 31, 2020. Disaggregation of Revenue The following table summarizes the Company’s net sales by product line for each operating segment (in thousands): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 Flight Support Group: Aftermarket replacement parts (1) $412,088 $500,714 $102,629 $173,992 Repair and overhaul parts and services (2) 154,517 216,887 32,601 76,270 Specialty products (3) 164,584 197,879 42,928 69,754 Total net sales 731,189 915,480 178,158 320,016 Electronic Technologies Group: Electronic component parts primarily for defense, space and aerospace equipment (4) 494,864 459,445 165,189 160,031 Electronic component parts for equipment in various other industries (5) 143,421 155,564 45,730 56,098 Total net sales 638,285 615,009 210,919 216,129 Intersegment sales (8,643) (16,371) (2,667) (3,821) Total consolidated net sales $1,360,831 $1,514,118 $386,410 $532,324 (1) Includes various jet engine and aircraft component replacement parts. (2) Includes primarily the sale of parts consumed in various repair and overhaul services on selected jet engine and aircraft components, avionics, instruments, composites and flight surfaces of commercial and military aircraft. (3) Includes primarily the sale of specialty components such as thermal insulation blankets, renewable/reusable insulation systems, advanced niche components, complex composite assemblies, and expanded foil mesh. (4) Includes various component parts such as electro-optical infrared simulation and test equipment, electro-optical laser products, electro-optical, microwave and other power equipment, high-speed interface products, power conversion products, underwater locator beacons, emergency locator transmission beacons, traveling wave tube amplifiers, microwave power modules, three-dimensional microelectronic and stacked memory products, crashworthy and ballistically self-sealing auxiliary fuel systems, radio frequency (RF) and microwave amplifiers, transmitters and receivers, high performance communications and electronic intercept receivers and tuners, high performance active antenna systems, and technical surveillance countermeasures equipment. (5) Includes various component parts such as electromagnetic and radio interference shielding, high voltage interconnection devices, high voltage advanced power electronics, harsh environment connectivity products, custom molded cable assemblies and silicone material for a variety of demanding applications. The following table summarizes the Company’s net sales by industry for each operating segment (in thousands): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 Flight Support Group: Aerospace $543,205 $742,555 $114,627 $258,157 Defense and Space 157,664 137,272 53,269 49,769 Other (1) 30,320 35,653 10,262 12,090 Total net sales 731,189 915,480 178,158 320,016 Electronic Technologies Group: Defense and Space 413,883 390,046 141,282 138,875 Other (2) 167,861 162,063 55,155 56,525 Aerospace 56,541 62,900 14,482 20,729 Total net sales 638,285 615,009 210,919 216,129 Intersegment sales (8,643) (16,371) (2,667) (3,821) Total consolidated net sales $1,360,831 $1,514,118 $386,410 $532,324 (1) Principally industrial products. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Jul. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | INCOME TAXES The Company's effective tax rate in the first nine months of fiscal 2020 was 3.5%, as compared to 17.1% in the first nine months of fiscal 2019. The Company recognized a discrete tax benefit from stock option exercises in both the first quarter of fiscal 2020 and 2019 of $47.6 million and $16.6 million, respectively. The $31.0 million larger benefit from stock option exercises recognized in the first quarter of fiscal 2020 was the result of more stock options exercised and the strong appreciation in HEICO's stock price during the optionees' holding periods. Further, the decrease in the first nine months of fiscal 2020 reflects a larger deduction related to Foreign-Derived Intangible Income ("FDII") principally resulting from final tax regulations that were issued in the third quarter of fiscal 2020 as part of the Tax Cuts and Jobs Act that was enacted in December 2017, as well as a larger income tax credit for qualified R&D activities. The Company's effective tax rate in the third quarter of fiscal 2020 was 13.4%, as compared to 22.0% in the third quarter of fiscal 2019. The decrease in the third quarter of fiscal 2020 principally reflects a larger deduction related to the previously mentioned FDII as well as a larger income tax credit for qualified R&D activities. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Jul. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | FAIR VALUE MEASUREMENTS The Company's assets and liabilities that were measured at fair value on a recurring basis are set forth by level within the fair value hierarchy in the following tables (in thousands): As of July 31, 2020 Quoted Prices Significant Significant Unobservable Inputs Total Assets: Deferred compensation plan: Corporate-owned life insurance $— $176,921 $— $176,921 Money market funds 1,011 — — 1,011 Total assets $1,011 $176,921 $— $177,932 Liabilities: Contingent consideration $— $— $18,015 $18,015 As of October 31, 2019 Quoted Prices Significant Significant Unobservable Inputs Total Assets: Deferred compensation plan: Corporate-owned life insurance $— $151,871 $— $151,871 Money market funds 20 — — 20 Total assets $20 $151,871 $— $151,891 Liabilities: Contingent consideration $— $— $18,326 $18,326 The Company maintains the HEICO Corporation Leadership Compensation Plan (the "LCP"), which is a non-qualified deferred compensation plan. The assets of the LCP principally represent cash surrender values of life insurance policies, which derive their fair values from investments in mutual funds that are managed by an insurance company, and are classified within Level 2 and valued using a market approach. Certain other assets of the LCP represent investments in money market funds that are classified within Level 1. The assets of the LCP are held within an irrevocable trust and classified within other assets in the Company’s Condensed Consolidated Balance Sheets. The related liabilities of the LCP are included within other long-term liabilities and accrued expenses and other current liabilities in the Company’s Condensed Consolidated Balance Sheets and have an aggregate value of $177.1 million as of July 31, 2020 and $151.1 million as of October 31, 2019. As part of the agreement to acquire a subsidiary by the FSG in fiscal 2019, the Company may be obligated to pay contingent consideration of $6.4 million in fiscal 2022 should the acquired entity meet a certain earnings objective during the second and third years following the acquisition. Based on lower actual than anticipated earnings as well as revised earnings estimates for the remainder of the earnout period, the $1.1 million estimated fair value of the contingent consideration as of October 31, 2019 was reversed during the third quarter of fiscal 2020. As part of the agreement to acquire a subsidiary by the ETG in fiscal 2017, the Company may be obligated to pay contingent consideration of $20.0 million in fiscal 2023 should the acquired entity meet a certain earnings objective during the first six years following the acquisition. As of July 31, 2020, the estimated fair value of the contingent consideration was $18.0 million. The estimated fair value of the contingent consideration arrangements described above are classified within Level 3 and were determined using probability-based scenario analyses. Under this method, a set of discrete potential future subsidiary earnings was determined using internal estimates based on various revenue growth rate assumptions for each scenario. A probability of likelihood was assigned to each discrete potential future earnings estimate and the resultant contingent consideration was calculated. The resulting probability-weighted contingent consideration amounts were discounted using a weighted average discount rate reflecting the credit risk of HEICO. Changes in either the revenue growth rates, related earnings or the discount rate could result in a material change to the amount of contingent consideration accrued and such changes will be recorded in the Company's condensed consolidated statements of operations. The Level 3 inputs used to derive the estimated fair value of the Company's contingent consideration liability as of July 31, 2020 were as follows: Fiscal 2017 Acquisition Compound annual revenue growth rate range (3 %) - 10% Weighted average discount rate 3.3% Changes in the Company’s contingent consideration liability measured at fair value on a recurring basis using unobservable inputs (Level 3) for the nine months ended July 31, 2020 are as follows (in thousands): Liabilities Balance as of October 31, 2019 $18,326 Increase in accrued contingent consideration, net 189 Payment of contingent consideration (500) Balance as of July 31, 2020 $18,015 The Company's contingent consideration liability is included in other long-term liabilities in its Condensed Consolidated Balance Sheets and the Company records changes in accrued contingent consideration within selling, general and administrative expenses in its Condensed Consolidated Statements of Operations. The Company did not have any transfers between Level 1 and Level 2 fair value measurements during the nine months ended July 31, 2020. The carrying amounts of the Company’s cash and cash equivalents, accounts receivable, trade accounts payable and accrued expenses and other current liabilities approximate fair value as of July 31, 2020 due to the relatively short maturity of the respective instruments. The carrying amount of long-term debt approximates fair value due to its variable interest rates. |
LEASES
LEASES | 9 Months Ended |
Jul. 31, 2020 | |
Leases [Abstract] | |
Lessee, Operating Leases [Text Block] | LEASES The Company’s lease arrangements primarily pertain to manufacturing facilities, office buildings, equipment, land and vehicles. The Company evaluates whether a contractual arrangement that provides it with control over the use of an asset is, or contains, a lease at the inception date. The term of a lease is inclusive of any option to renew, extend, or terminate the lease when it is reasonably certain that the Company will exercise such option. The Company classifies a lease as operating or finance using the classification criteria set forth in ASC 842. Finance leases are not material to the Company's condensed consolidated financial statements. HEICO recognizes operating lease right-of-use (“ROU”) assets and corresponding lease liabilities as of the lease commencement date based on the present value of the lease payments over the lease term. The discount rate used to calculate the present value of the Company’s leases is based on HEICO’s incremental borrowing rate and considers credit risk, the lease term and other available information as of the commencement date since the leases do not provide a readily determinable implicit rate. Variable lease payments that depend on an index or a rate are included in the determination of operating ROU assets and lease liabilities using the index or rate at the lease commencement date. Variable lease payments that do not depend on an index or rate or resulting from changes in an index or rate subsequent to the lease commencement date, are recorded as lease expense in the period in which the obligation for the payment is incurred. The Company’s operating ROU assets are increased by any prepaid lease payments and initial direct costs and reduced by any lease incentives. The Company’s leases do not contain any material residual value guarantees or restrictive covenants. HEICO’s operating lease ROU assets represent its right to use an underlying asset during the lease term and its operating lease liabilities represent the Company’s obligation to make lease payments arising from the lease. HEICO’s operating lease ROU assets are included within other assets and its operating lease liabilities are included within other long-term liabilities and accrued expenses and other current liabilities in the Company’s Condensed Consolidated Balance Sheet. For additional information on the Company’s finance leases, see Note 5, Long-term Debt, of the Notes to Condensed Consolidated Financial Statements of this Quarterly Report and Note 5, Long-term Debt, and Note 3, Selected Financial Statement Information - Property, Plant and Equipment, of the Notes to Consolidated Financial Statements of the Company’s Annual Report on Form 10-K for the year ended October 31, 2019. The following table presents the Company’s operating lease ROU assets and lease liabilities as of July 31, 2020 (in thousands): July 31, 2020 Right-of-use assets $57,752 Current lease liabilities $13,587 Long-term lease liabilities 45,232 Total operating lease liabilities $58,819 The Company’s operating lease expense is recorded as a component of cost of sales and/or selling, general, and administrative expenses in the Company’s Condensed Consolidated Statements of Operations. The following table presents the components of operating lease expense for the nine and three months ended July 31, 2020 (in thousands): Nine months ended Three months ended July 31, 2020 July 31, 2020 Operating lease expense $12,855 $4,311 Variable lease expense 1,942 619 Total operating lease expense (1) $14,797 $4,930 (1) Excludes short-term lease expense, which is not material. The following table presents a maturity analysis of the Company's operating lease liabilities as of July 31, 2020 for the remainder of fiscal 2020 and the next five fiscal years and thereafter (in thousands): Year ending October 31, 2020 $3,639 2021 16,377 2022 14,394 2023 8,952 2024 5,115 2025 4,243 Thereafter 18,566 Total minimum lease payments 71,286 Less: amount representing interest (12,467) Present value of minimum lease payments $58,819 Prior to the adoption of ASC 842, the Company's future minimum lease payments under non-cancelable operating leases on an undiscounted basis as of October 31, 2019 were $15.5 million in fiscal 2020, $15.6 million in fiscal 2021, $13.8 million in fiscal 2022, $8.5 million in fiscal 2023, $4.7 million in fiscal 2024 and $18.8 million thereafter. The Company does not have any material leases that have been signed but have yet to commence as of July 31, 2020. The following table presents the weighted average remaining lease term and discount rate of the Company’s operating leases as of July 31, 2020: July 31, 2020 Weighted average remaining lease term (years) 7.0 Weighted average discount rate 5.1 % The following table presents supplemental disclosures of cash flow information associated with the Company's operating leases for the nine months ended July 31, 2020 (in thousands): Nine months ended July 31, 2020 Cash paid for amounts included in the measurement of lease liabilities $12,652 Right-of-use assets obtained in exchange for new lease liabilities 7,423 |
NET INCOME PER SHARE ATTRIBUTAB
NET INCOME PER SHARE ATTRIBUTABLE TO HEICO SHAREHOLDERS | 9 Months Ended |
Jul. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | NET INCOME PER SHARE ATTRIBUTABLE TO HEICO SHAREHOLDERS The computation of basic and diluted net income per share attributable to HEICO shareholders is as follows (in thousands, except per share data): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 Numerator: Net income attributable to HEICO $251,657 $242,212 $54,316 $81,098 Denominator: Weighted average common shares outstanding - basic 134,676 133,405 134,837 133,970 Effect of dilutive stock options 2,581 3,868 2,397 3,664 Weighted average common shares outstanding - diluted 137,257 137,273 137,234 137,634 Net income per share attributable to HEICO shareholders: Basic $1.87 $1.82 $.40 $.61 Diluted $1.83 $1.76 $.40 $.59 Anti-dilutive stock options excluded 272 439 250 88 |
OPERATING SEGMENTS
OPERATING SEGMENTS | 9 Months Ended |
Jul. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | OPERATING SEGMENTS Information on the Company’s two operating segments, the FSG and the ETG, for the nine and three months ended July 31, 2020 and 2019, respectively, is as follows (in thousands): Other, Primarily Corporate and Intersegment (1) Consolidated Segment FSG ETG Nine months ended July 31, 2020: Net sales $731,189 $638,285 ($8,643) $1,360,831 Depreciation 10,835 8,681 760 20,276 Amortization 14,720 29,484 738 44,942 Operating income 121,597 184,948 (18,960) 287,585 Capital expenditures 8,389 9,066 17 17,472 Nine months ended July 31, 2019: Net sales $915,480 $615,009 ($16,371) $1,514,118 Depreciation 10,225 8,117 754 19,096 Amortization 14,714 27,138 738 42,590 Operating income 179,843 181,160 (24,459) 336,544 Capital expenditures 12,600 9,008 63 21,671 Three months ended July 31, 2020: Net sales $178,158 $210,919 ($2,667) $386,410 Depreciation 3,590 2,872 249 6,711 Amortization 5,109 9,876 246 15,231 Operating income 12,021 61,931 (5,518) 68,434 Capital expenditures 1,624 3,401 12 5,037 Three months ended July 31, 2019: Net sales $320,016 $216,129 ($3,821) $532,324 Depreciation 3,467 2,722 251 6,440 Amortization 4,991 9,461 246 14,698 Operating income 64,797 62,206 (7,589) 119,414 Capital expenditures 6,024 2,996 55 9,075 (1) Intersegment activity principally consists of net sales from the ETG to the FSG. Total assets by operating segment are as follows (in thousands): Other, Consolidated Segment FSG ETG Total assets as of July 31, 2020 $1,153,879 $1,741,959 $527,412 $3,423,250 Total assets as of October 31, 2019 1,149,737 1,643,032 176,442 2,969,211 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Jul. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | COMMITMENTS AND CONTINGENCIES Guarantees As of July 31, 2020, the Company has arranged for standby letters of credit aggregating $4.5 million, which are supported by its revolving credit facility and pertain to payment guarantees related to potential workers' compensation claims and a facility lease as well as performance guarantees related to customer contracts entered into by certain of the Company's subsidiaries. Product Warranty Changes in the Company’s product warranty liability for the nine months ended July 31, 2020 and 2019, respectively, are as follows (in thousands): Nine months ended July 31, 2020 2019 Balances as of beginning of fiscal year $2,810 $3,306 Accruals for warranties 1,472 1,652 Acquired warranty liabilities 50 — Warranty claims settled (1,259) (1,974) Balances as of July 31 $3,073 $2,984 Litigation The Company is involved in various legal actions arising in the normal course of business. Based upon the Company’s and its legal counsel’s evaluations of any claims or assessments, management is of the opinion that the outcome of these matters will not have a material adverse effect on the Company’s results of operations, financial position or cash flows. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jul. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS In August 2020, the Company, through HEICO Electronic, acquired 75% of the equity interests of Intelligent Devices, Inc. ("ID") and Transformational Security, LLC ("TS"). ID and TS design, develop and manufacturer state-of-the-art Technical Surveillance Countermeasures (TSCM) equipment used to protect critical spaces from exploitation via wireless transmissions, technical surveillance and listening devices. The remaining 25% interest in ID and TS was acquired by the noncontrolling interest holders of a subsidiary in HEICO Electronic that is also a designer and manufacturer of TSCM equipment. In August 2020, the Company, through HEICO Electronic, acquired 89.99% of the equity interests of Connect Tech Inc. ("Connect Tech"). Connect Tech designs and manufacturers rugged, small-form-factor embedded computing solutions. Connect Tech's components are designed for very harsh environments and are primarily used in rugged commercial and industrial, aerospace and defense, transportation, and smart energy applications. The remaining 10.01% interest continues to be owned by a certain member of Connect Tech's management team. The purchase price of each August 2020 acquisition was paid in cash using cash on hand, and is not material or significant to the Company’s condensed consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Jul. 31, 2020 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Basis of Presentation [Text Block] | Basis of Presentation The accompanying unaudited condensed consolidated financial statements of HEICO Corporation and its subsidiaries (collectively, “HEICO,” or the “Company”) have been prepared in conformity with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q. Therefore, the condensed consolidated financial statements do not include all information and footnotes normally included in annual consolidated financial statements and should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended October 31, 2019. The October 31, 2019 Condensed Consolidated Balance Sheet has been derived from the Company’s audited consolidated financial statements. In the opinion of management, the unaudited condensed consolidated financial statements contain all adjustments (consisting principally of normal recurring accruals) necessary for a fair presentation of the condensed consolidated balance sheets, statements of operations, statements of comprehensive income, statements of shareholders' equity and statements of cash flows for such interim periods presented. The results of operations for the nine months ended July 31, 2020 are not necessarily indicative of the results which may be expected for the entire fiscal year. The Company has two operating segments: the Flight Support Group (“FSG”), consisting of HEICO Aerospace Holdings Corp. and HEICO Flight Support Corp. and their respective subsidiaries; and the Electronic Technologies Group (“ETG”), consisting of HEICO Electronic Technologies Corp. (“HEICO Electronic”) and its subsidiaries. The Company's results of operations for the nine and three months ended July 31, 2020 have been significantly affected by the COVID-19 outbreak, which is classified as a global pandemic (the “Outbreak”). The effects of the Outbreak and related actions by governments around the world to mitigate its spread have impacted the Company's employees, customers, suppliers and manufacturers. In response to the economic impact from the Outbreak, the Company has implemented certain cost reduction efforts, including layoffs, temporary reduced work hours and temporary pay reductions within various departments of its business, including within its executive management team and its Board of Directors. Additionally, the Company's response to the Outbreak has included the implementation of varying health and safety measures at its facilities, including: supplying and requiring the use of personal protective equipment; staggering work shifts; body temperature taking; increasing work-from-home capabilities; consistent and ongoing cleaning of work spaces and high-touch areas; and establishing processes aligned with the Centers for Disease and Control guidelines to work with any individual exposed to COVID-19 on their necessary quarantine period and the process for the individual to return to work. With respect to the Company's results of operations, approximately half of its net sales are derived from defense, space and other industrial markets including electronics, medical and telecommunications. Demand for products in that half of the Company's business has not been fundamentally impacted and its operational results remain materially consistent with financial expectations prior to the Outbreak. However, the Company has experienced, and expects to continue experiencing, periodic operational disruptions resulting from supply chain disturbances, staffing challenges - including at some of its customers, temporary facility closures, transportation interruptions and other conditions which slow production and orders, or increase costs. While these issues have not yet been material overall, the Company has experienced disruptions in some orders and shipments during the third quarter of fiscal 2020. The remaining portion of HEICO's net sales is derived from commercial aviation products and services. The Outbreak has caused significant volatility and a substantial decline in value across global markets. Most notably, the commercial aerospace industry experienced an ongoing substantial decline in demand resulting from a significant number of aircraft in the global fleet being grounded during HEICO's third quarter of fiscal 2020. The Company's businesses that operate within the commercial aerospace industry have been materially impacted by the significant decline in global commercial air travel that began in March 2020. Consolidated net sales for the Company's businesses that operate within the commercial aerospace industry decreased by approximately 54% during the third quarter of fiscal 2020. Once commercial air travel resumes, cost savings will most likely be a priority for HEICO's commercial aviation customers and the Company anticipates recovery in demand for its commercial aviation products, which frequently provide aircraft operators with significant savings. Furthermore, HEICO believes its cost-saving solutions and robust product development programs will enable it to potentially increase market share and emerge with a stronger presence within this market. As a result of the Outbreak, HEICO has assessed various accounting estimates, including those that require consideration of forecasted financial information, in context of the unknown future impacts of the Outbreak as of July 31, 2020 and through the date of filing this Quarterly Report. The accounting estimates assessed include, but were not limited to, the Company’s allowance for doubtful accounts, inventory reserves, contingent consideration arrangements, goodwill and other long-lived assets. Based on these assessments, no material impact was recorded to HEICO’s Condensed Consolidated Statement of Operations for the nine and three months ended July 31, 2020. Although not material, see Note 3, Selected Financial Statement Information - Accounts Receivable, for additional information pertaining to the increase in the Company's allowance for doubtful accounts principally due to bankruptcy filings by certain commercial aviation customers resulting from the financial impact of the Outbreak. Also, see Management's Discussion and Analysis of Financial Condition and Results of Operations for the related impact on bad debt expense. |
Accounting Standards Update 2016-02 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02, which, as amended, was codified as Accounting Standards Codification ("ASC") Topic 842, "Leases" ("ASC 842"). ASC 842 requires recognition of lease assets and lease liabilities on the balance sheet of lessees. The Company adopted ASC 842 as of November 1, 2019 using a modified retrospective transition approach with the election to apply the guidance as of the adoption date instead of at the beginning of the earliest comparative period presented. The adoption of this guidance resulted in an increase in the Company's assets and liabilities due to the recognition of right-of-use ("ROU") assets and corresponding lease liabilities for leases that are currently classified as operating leases. Upon adoption, the Company elected the package of transitional practical expedients, which allowed the Company to not reassess its prior conclusions about lease identification, lease classification, and initial direct costs. In addition, the Company elected the short-term lease practical expedient, which allows HEICO to not record an ROU asset and lease liability for any lease with a term of twelve months or less, and also elected the single component practical expedient for all asset classes, which allows the Company to include both lease and non-lease components associated with a lease as a single lease component when determining the value of the ROU asset and lease liability. The adoption of this guidance resulted in the Company recording ROU assets and corresponding lease liabilities of $63.4 million and $64.1 million, respectively, in the Company's Condensed Consolidated Balance Sheet. The adoption of ASC 842 did not have a material impact on the Company’s Condensed Consolidated Statement of Operations or Statement of Cash Flows. See Note 9, Leases, for additional information regarding the Company's accounting policy for leases and disclosures required by ASC 842. |
Accounting Standards Update 2017-04 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment," which is intended to simplify the current test for goodwill impairment by eliminating the second step in which the implied value of a reporting unit is calculated when the carrying value of the reporting unit exceeds its fair value. Under ASU 2017-04, goodwill impairment should be recognized for the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. ASU 2017-04 must be applied prospectively and is effective for any annual or interim goodwill impairment test in fiscal years beginning after December 15, 2019, or in fiscal 2021 for HEICO. Early adoption is permitted. The Company is currently evaluating the effect the adoption of this guidance will have on its consolidated results of operations, financial position and cash flows. |
SELECTED FINANCIAL STATEMENT _2
SELECTED FINANCIAL STATEMENT INFORMATION (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Selected Financial Statement Information [Abstract] | |
Schedule of Accounts Receivable [Table Text Block] | Accounts Receivable (in thousands) July 31, 2020 October 31, 2019 Accounts receivable $193,173 $277,992 Less: Allowance for doubtful accounts (12,039) (3,666) Accounts receivable, net $181,134 $274,326 |
Schedule of Inventories [Table Text Block] | Inventories (in thousands) July 31, 2020 October 31, 2019 Finished products $241,895 $199,880 Work in process 39,777 32,548 Materials, parts, assemblies and supplies 191,432 187,891 Inventories, net of valuation reserves $473,104 $420,319 |
Schedule of Property, Plant and Equipment [Table Text Block] | Property, Plant and Equipment (in thousands) July 31, 2020 October 31, 2019 Land $6,922 $6,820 Buildings and improvements 122,405 116,997 Machinery, equipment and tooling 264,900 253,127 Construction in progress 9,593 8,382 403,820 385,326 Less: Accumulated depreciation and amortization (233,480) (211,981) Property, plant and equipment, net $170,340 $173,345 |
Schedule of Research and Development Expenses [Table Text Block] | The amount of new product research and development ("R&D") expenses included in cost of sales for the nine and three months ended July 31, 2020 and 2019 is as follows (in thousands): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 R&D expenses $48,968 $48,697 $15,113 $16,648 |
Schedule of Redeemable Noncontrolling Interests [Table Text Block] | Management's estimate of the aggregate Redemption Amount of all Put Rights that the Company could be required to pay is as follows (in thousands): July 31, 2020 October 31, 2019 Redeemable at fair value $154,074 $136,611 Redeemable based on a multiple of future earnings 50,065 51,653 Redeemable noncontrolling interests $204,139 $188,264 |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | Changes in the components of accumulated other comprehensive loss for the nine months ended July 31, 2020 are as follows (in thousands): Foreign Currency Translation Defined Benefit Pension Plan Accumulated Balances as of October 31, 2019 ($14,989) ($1,750) ($16,739) Unrealized gain 12,228 — 12,228 Amortization of unrealized loss — 60 60 Balances as of July 31, 2020 ($2,761) ($1,690) ($4,451) |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill [Table Text Block] | Changes in the carrying amount of goodwill by operating segment for the nine months ended July 31, 2020 are as follows (in thousands): Segment Consolidated Totals FSG ETG Balances as of October 31, 2019 $410,044 $858,659 $1,268,703 Goodwill acquired 14,986 34,589 49,575 Foreign currency translation adjustments 3,425 2,878 6,303 Deconsolidation of subsidiary — (4,249) (4,249) Adjustments to goodwill — (285) (285) Balances as of July 31, 2020 $428,455 $891,592 $1,320,047 |
Schedule Of Identifiable Intangible Assets [Table Text Block] | Identifiable intangible assets consist of the following (in thousands): As of July 31, 2020 As of October 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizing Assets: Customer relationships $426,423 ($189,469) $236,954 $411,076 ($162,722) $248,354 Intellectual property 225,396 (80,220) 145,176 216,359 (70,169) 146,190 Licenses 6,559 (4,529) 2,030 6,559 (4,102) 2,457 Patents 1,048 (732) 316 986 (666) 320 Non-compete agreements 810 (810) — 813 (813) — Trade names 450 (209) 241 450 (180) 270 660,686 (275,969) 384,717 636,243 (238,652) 397,591 Non-Amortizing Assets: Trade names 157,957 — 157,957 153,102 — 153,102 $818,643 ($275,969) $542,674 $789,345 ($238,652) $550,693 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | Long-term debt consists of the following (in thousands): July 31, 2020 October 31, 2019 Borrowings under revolving credit facility $730,000 $553,000 Finance leases and note payable 10,089 8,955 740,089 561,955 Less: Current maturities of long-term debt (1,073) (906) $739,016 $561,049 |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Asset and Liability [Table Text Block] | Changes in the Company’s contract assets and liabilities for the nine months ended July 31, 2020 are as follows (in thousands): July 31, 2020 October 31, 2019 Change Contract assets $59,113 $43,132 $15,981 Contract liabilities 22,863 23,809 (946) Net contract assets $36,250 $19,323 $16,927 |
Product Line [Member] | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue [Table Text Block] | The following table summarizes the Company’s net sales by product line for each operating segment (in thousands): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 Flight Support Group: Aftermarket replacement parts (1) $412,088 $500,714 $102,629 $173,992 Repair and overhaul parts and services (2) 154,517 216,887 32,601 76,270 Specialty products (3) 164,584 197,879 42,928 69,754 Total net sales 731,189 915,480 178,158 320,016 Electronic Technologies Group: Electronic component parts primarily for defense, space and aerospace equipment (4) 494,864 459,445 165,189 160,031 Electronic component parts for equipment in various other industries (5) 143,421 155,564 45,730 56,098 Total net sales 638,285 615,009 210,919 216,129 Intersegment sales (8,643) (16,371) (2,667) (3,821) Total consolidated net sales $1,360,831 $1,514,118 $386,410 $532,324 (1) Includes various jet engine and aircraft component replacement parts. (2) Includes primarily the sale of parts consumed in various repair and overhaul services on selected jet engine and aircraft components, avionics, instruments, composites and flight surfaces of commercial and military aircraft. (3) Includes primarily the sale of specialty components such as thermal insulation blankets, renewable/reusable insulation systems, advanced niche components, complex composite assemblies, and expanded foil mesh. (4) Includes various component parts such as electro-optical infrared simulation and test equipment, electro-optical laser products, electro-optical, microwave and other power equipment, high-speed interface products, power conversion products, underwater locator beacons, emergency locator transmission beacons, traveling wave tube amplifiers, microwave power modules, three-dimensional microelectronic and stacked memory products, crashworthy and ballistically self-sealing auxiliary fuel systems, radio frequency (RF) and microwave amplifiers, transmitters and receivers, high performance communications and electronic intercept receivers and tuners, high performance active antenna systems, and technical surveillance countermeasures equipment. (5) Includes various component parts such as electromagnetic and radio interference shielding, high voltage interconnection devices, high voltage advanced power electronics, harsh environment connectivity products, custom molded cable assemblies and silicone material for a variety of demanding applications. |
Sales by Industry [Member] | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue [Table Text Block] | The following table summarizes the Company’s net sales by industry for each operating segment (in thousands): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 Flight Support Group: Aerospace $543,205 $742,555 $114,627 $258,157 Defense and Space 157,664 137,272 53,269 49,769 Other (1) 30,320 35,653 10,262 12,090 Total net sales 731,189 915,480 178,158 320,016 Electronic Technologies Group: Defense and Space 413,883 390,046 141,282 138,875 Other (2) 167,861 162,063 55,155 56,525 Aerospace 56,541 62,900 14,482 20,729 Total net sales 638,285 615,009 210,919 216,129 Intersegment sales (8,643) (16,371) (2,667) (3,821) Total consolidated net sales $1,360,831 $1,514,118 $386,410 $532,324 (1) Principally industrial products. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The Company's assets and liabilities that were measured at fair value on a recurring basis are set forth by level within the fair value hierarchy in the following tables (in thousands): As of July 31, 2020 Quoted Prices Significant Significant Unobservable Inputs Total Assets: Deferred compensation plan: Corporate-owned life insurance $— $176,921 $— $176,921 Money market funds 1,011 — — 1,011 Total assets $1,011 $176,921 $— $177,932 Liabilities: Contingent consideration $— $— $18,015 $18,015 As of October 31, 2019 Quoted Prices Significant Significant Unobservable Inputs Total Assets: Deferred compensation plan: Corporate-owned life insurance $— $151,871 $— $151,871 Money market funds 20 — — 20 Total assets $20 $151,871 $— $151,891 Liabilities: Contingent consideration $— $— $18,326 $18,326 |
Fair Value Measurement Inputs and Valuation Techniques [Table Text Block] | The Level 3 inputs used to derive the estimated fair value of the Company's contingent consideration liability as of July 31, 2020 were as follows: Fiscal 2017 Acquisition Compound annual revenue growth rate range (3 %) - 10% Weighted average discount rate 3.3% |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | Changes in the Company’s contingent consideration liability measured at fair value on a recurring basis using unobservable inputs (Level 3) for the nine months ended July 31, 2020 are as follows (in thousands): Liabilities Balance as of October 31, 2019 $18,326 Increase in accrued contingent consideration, net 189 Payment of contingent consideration (500) Balance as of July 31, 2020 $18,015 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Leases [Abstract] | |
Lessee, Operating Lease Asset and Liabilities [Table Text Block] | The following table presents the Company’s operating lease ROU assets and lease liabilities as of July 31, 2020 (in thousands): July 31, 2020 Right-of-use assets $57,752 Current lease liabilities $13,587 Long-term lease liabilities 45,232 Total operating lease liabilities $58,819 |
Lease, Cost [Table Text Block] | The following table presents the components of operating lease expense for the nine and three months ended July 31, 2020 (in thousands): Nine months ended Three months ended July 31, 2020 July 31, 2020 Operating lease expense $12,855 $4,311 Variable lease expense 1,942 619 Total operating lease expense (1) $14,797 $4,930 (1) Excludes short-term lease expense, which is not material. |
Lessee, Operating Lease, Liability, Maturity [Table Text Block] | The following table presents a maturity analysis of the Company's operating lease liabilities as of July 31, 2020 for the remainder of fiscal 2020 and the next five fiscal years and thereafter (in thousands): Year ending October 31, 2020 $3,639 2021 16,377 2022 14,394 2023 8,952 2024 5,115 2025 4,243 Thereafter 18,566 Total minimum lease payments 71,286 Less: amount representing interest (12,467) Present value of minimum lease payments $58,819 |
Lessee, Operating Lease Term and Discount Rate [Table Text Block] | The following table presents the weighted average remaining lease term and discount rate of the Company’s operating leases as of July 31, 2020: July 31, 2020 Weighted average remaining lease term (years) 7.0 Weighted average discount rate 5.1 % |
Schedule of Cash Flow, Supplemental Disclosures [Table Text Block] | The following table presents supplemental disclosures of cash flow information associated with the Company's operating leases for the nine months ended July 31, 2020 (in thousands): Nine months ended July 31, 2020 Cash paid for amounts included in the measurement of lease liabilities $12,652 Right-of-use assets obtained in exchange for new lease liabilities 7,423 |
NET INCOME PER SHARE ATTRIBUT_2
NET INCOME PER SHARE ATTRIBUTABLE TO HEICO SHAREHOLDERS (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The computation of basic and diluted net income per share attributable to HEICO shareholders is as follows (in thousands, except per share data): Nine months ended July 31, Three months ended July 31, 2020 2019 2020 2019 Numerator: Net income attributable to HEICO $251,657 $242,212 $54,316 $81,098 Denominator: Weighted average common shares outstanding - basic 134,676 133,405 134,837 133,970 Effect of dilutive stock options 2,581 3,868 2,397 3,664 Weighted average common shares outstanding - diluted 137,257 137,273 137,234 137,634 Net income per share attributable to HEICO shareholders: Basic $1.87 $1.82 $.40 $.61 Diluted $1.83 $1.76 $.40 $.59 Anti-dilutive stock options excluded 272 439 250 88 |
OPERATING SEGMENTS (Tables)
OPERATING SEGMENTS (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule Of Segment Reporting Information By Segment [Table Text Block] | Information on the Company’s two operating segments, the FSG and the ETG, for the nine and three months ended July 31, 2020 and 2019, respectively, is as follows (in thousands): Other, Primarily Corporate and Intersegment (1) Consolidated Segment FSG ETG Nine months ended July 31, 2020: Net sales $731,189 $638,285 ($8,643) $1,360,831 Depreciation 10,835 8,681 760 20,276 Amortization 14,720 29,484 738 44,942 Operating income 121,597 184,948 (18,960) 287,585 Capital expenditures 8,389 9,066 17 17,472 Nine months ended July 31, 2019: Net sales $915,480 $615,009 ($16,371) $1,514,118 Depreciation 10,225 8,117 754 19,096 Amortization 14,714 27,138 738 42,590 Operating income 179,843 181,160 (24,459) 336,544 Capital expenditures 12,600 9,008 63 21,671 Three months ended July 31, 2020: Net sales $178,158 $210,919 ($2,667) $386,410 Depreciation 3,590 2,872 249 6,711 Amortization 5,109 9,876 246 15,231 Operating income 12,021 61,931 (5,518) 68,434 Capital expenditures 1,624 3,401 12 5,037 Three months ended July 31, 2019: Net sales $320,016 $216,129 ($3,821) $532,324 Depreciation 3,467 2,722 251 6,440 Amortization 4,991 9,461 246 14,698 Operating income 64,797 62,206 (7,589) 119,414 Capital expenditures 6,024 2,996 55 9,075 |
Reconciliation of Assets from Segment to Consolidated [Table Text Block] | Total assets by operating segment are as follows (in thousands): Other, Consolidated Segment FSG ETG Total assets as of July 31, 2020 $1,153,879 $1,741,959 $527,412 $3,423,250 Total assets as of October 31, 2019 1,149,737 1,643,032 176,442 2,969,211 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Jul. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Product Warranty Liability [Table Text Block] | Changes in the Company’s product warranty liability for the nine months ended July 31, 2020 and 2019, respectively, are as follows (in thousands): Nine months ended July 31, 2020 2019 Balances as of beginning of fiscal year $2,810 $3,306 Accruals for warranties 1,472 1,652 Acquired warranty liabilities 50 — Warranty claims settled (1,259) (1,974) Balances as of July 31 $3,073 $2,984 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textuals) $ in Thousands | Jul. 31, 2020USD ($) |
Operating Lease, Right-of-Use Asset | $ 57,752 |
Operating Lease, Liability | 58,819 |
Accounting Standards Update 2016-02 [Member] | |
Operating Lease, Right-of-Use Asset | 63,400 |
Operating Lease, Liability | $ 64,100 |
ACQUISITIONS (Details Textuals)
ACQUISITIONS (Details Textuals) | 9 Months Ended |
Jul. 31, 2020 | |
Electronic Technologies Group [Member] | HMI [Member] | |
Business Acquisition [Line Items] | |
Name of Acquired Entity | Human-Machine Interface |
Description of Acquired Entity | HMI designs, manufactures, and repairs flight deck annunciators, panels, indicators, and illuminated keyboards, as well as lighting controls, and flight deck lighting. |
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% |
Electronic Technologies Group [Member] | Quell [Member] | |
Business Acquisition [Line Items] | |
Name of Acquired Entity | Quell Corporation |
Description of Acquired Entity | Quell designs and manufactures electromagnetic interference (EMI)/radio-frequency interference (RFI) and transient protection solutions for a wide variety of connectors that principally serve customers within the aerospace and defense markets. |
Business Acquisition, Percentage of Voting Interests Acquired | 80.10% |
Electronic Technologies Group [Member] | EPC [Member] | |
Business Acquisition [Line Items] | |
Name of Acquired Entity | EPC Space LLC |
Description of Acquired Entity | EPC designs, develops, promotes, markets and sells radiation-hardened gallium nitride power solutions packaged for use in outer space and other high reliability applications. |
Business Acquisition, Percentage of Voting Interests Acquired | 49.00% |
Electronic Technologies Group [Member] | RMH [Member] | |
Business Acquisition [Line Items] | |
Name of Acquired Entity | Rocky Mountain Hydrostatics, LLC |
Description of Acquired Entity | Rocky Mountain overhauls industrial pumps, motors, and other hydraulic units with a focus on the support of legacy systems for the U.S. Navy. |
Electronic Technologies Group [Member] | Freebird [Member] | |
Business Acquisition [Line Items] | |
Name of Acquired Entity | Freebird Semiconductor Corporation |
Flight Support Corp [Member] | RMH [Member] | |
Business Acquisition [Line Items] | |
Business Acquisition, Percentage of Voting Interests Acquired | 70.00% |
Flight Support Corp [Member] | Freebird [Member] | |
Business Acquisition [Line Items] | |
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% |
Existing Management [Member] | Quell [Member] | |
Business Acquisition [Line Items] | |
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 19.90% |
Existing Management [Member] | RMH [Member] | |
Business Acquisition [Line Items] | |
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 30.00% |
SELECTED FINANCIAL STATEMENT _3
SELECTED FINANCIAL STATEMENT INFORMATION (Accounts Receivable) (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable | $ 193,173 | $ 277,992 |
Less: Allowance for doubtful accounts | (12,039) | (3,666) |
Accounts receivable, net | $ 181,134 | $ 274,326 |
SELECTED FINANCIAL STATEMENT _4
SELECTED FINANCIAL STATEMENT INFORMATION (Inventories) (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Inventory [Line Items] | ||
Finished products | $ 241,895 | $ 199,880 |
Work in process | 39,777 | 32,548 |
Materials, parts, assemblies and supplies | 191,432 | 187,891 |
Inventories, net of valuation reserves | $ 473,104 | $ 420,319 |
SELECTED FINANCIAL STATEMENT _5
SELECTED FINANCIAL STATEMENT INFORMATION (Property, Plant and Equipment) (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Land | $ 6,922 | $ 6,820 |
Buildings and improvements | 122,405 | 116,997 |
Machinery, equipment and tooling | 264,900 | 253,127 |
Construction in progress | 9,593 | 8,382 |
Property, plant and equipment, gross | 403,820 | 385,326 |
Less: Accumulated depreciation and amortization | (233,480) | (211,981) |
Property, plant and equipment, net | $ 170,340 | $ 173,345 |
SELECTED FINANCIAL STATEMENT _6
SELECTED FINANCIAL STATEMENT INFORMATION SELECTED FINANCIAL STATEMENT INFORMATION (Research and Development Expenses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Selected Financial Statement Information (Details) [Abstract] | ||||
R&D expenses | $ 15,113 | $ 16,648 | $ 48,968 | $ 48,697 |
SELECTED FINANCIAL STATEMENT _7
SELECTED FINANCIAL STATEMENT INFORMATION SELECTED FINANCIAL STATEMENT INFORMATION (Redeemable Noncontrolling Interests) (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Redeemable Noncontrolling Interest [Line Items] | ||
Redeemable at fair value | $ 154,074 | $ 136,611 |
Redeemable based on a multiple of future earnings | 50,065 | 51,653 |
Redeemable noncontrolling interests | $ 204,139 | $ 188,264 |
SELECTED FINANCIAL STATEMENT _8
SELECTED FINANCIAL STATEMENT INFORMATION SELECTED FINANCIAL STATEMENT INFORMATION (Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Starting accumulated other comprehensive loss | $ (16,739) | |||
Unrealized gain | 12,228 | |||
Amortization of unrealized loss on defined benefit pension plan, net of tax | $ 21 | $ 6 | 60 | $ 18 |
Ending accumulated other comprehensive loss | (4,451) | (4,451) | ||
Foreign Currency Translation [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Starting accumulated other comprehensive loss | (14,989) | |||
Unrealized gain | 12,228 | |||
Ending accumulated other comprehensive loss | (2,761) | (2,761) | ||
Pension Benefit Obligation [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Starting accumulated other comprehensive loss | (1,750) | |||
Amortization of unrealized loss on defined benefit pension plan, net of tax | 60 | |||
Ending accumulated other comprehensive loss | $ (1,690) | $ (1,690) |
SELECTED FINANCIAL STATEMENT _9
SELECTED FINANCIAL STATEMENT INFORMATION (Details Textuals) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | Apr. 30, 2020 | Oct. 31, 2019 | |
Selected Financial Statement Information (Details) [Abstract] | ||||||
Accounts Receivable, Allowance for Credit Loss, Period Increase (Decrease) | $ 8,400 | |||||
Accrued customer rebates and credits | 16,600 | $ 16,600 | $ 18,000 | |||
Total customer rebates and credits deducted within net sales | $ 500 | $ 2,900 | 4,300 | $ 6,500 | ||
Business Acquisition [Line Items] | ||||||
Payments to Noncontrolling Interests | $ 7,475 | |||||
RMH [Member] | Existing Management [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 30.00% | 30.00% | ||||
Quell [Member] | Existing Management [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 19.90% | 19.90% | ||||
FY2015 Acquisition [Member] | Existing Management [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 20.00% | |||||
FY2008 Acquisition [Member] | Existing Management [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 17.70% | |||||
Electronic Technologies Group [Member] | Quell [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 80.10% | 80.10% | ||||
Electronic Technologies Group [Member] | FY2012 Acquisition [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 22.00% | 22.00% | ||||
Electronic Technologies Group [Member] | FY2012 Acquisition [Member] | Electronic Technologies Group [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | 100.00% | ||||
Flight Support Group [Member] | FY2015 Acquisition [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 5.00% | 5.00% | ||||
Flight Support Group [Member] | FY2015 Acquisition [Member] | Flight Support Group [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Parent | 85.00% | 85.00% | ||||
Flight Support Group [Member] | FY2008 Acquisition [Member] | Flight Support Group [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Noncontrolling Interest, Ownership Percentage by Parent | 86.20% | 86.20% | ||||
Flight Support Corp [Member] | RMH [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 70.00% | 70.00% |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS (Goodwill) (Details) $ in Thousands | 9 Months Ended |
Jul. 31, 2020USD ($) | |
Goodwill [Line Items] | |
Opening Balance | $ 1,268,703 |
Goodwill acquired | 49,575 |
Foreign currency translation adjustments | 6,303 |
Goodwill, Written off Related to Sale of Business Unit | (4,249) |
Adjustments to goodwill | (285) |
Ending Balance | 1,320,047 |
Flight Support Group [Member] | |
Goodwill [Line Items] | |
Opening Balance | 410,044 |
Goodwill acquired | 14,986 |
Foreign currency translation adjustments | 3,425 |
Ending Balance | 428,455 |
Electronic Technologies Group [Member] | |
Goodwill [Line Items] | |
Opening Balance | 858,659 |
Goodwill acquired | 34,589 |
Foreign currency translation adjustments | 2,878 |
Goodwill, Written off Related to Sale of Business Unit | (4,249) |
Adjustments to goodwill | (285) |
Ending Balance | $ 891,592 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS (Identifiable Intangible Assets) (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | $ 660,686 | $ 636,243 |
Accumulated Amortization | (275,969) | (238,652) |
Net Carrying Amount | 384,717 | 397,591 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Intangible Asset Gross Carrying Amount | 818,643 | 789,345 |
Intangible Asset Net Carrying Amount | 542,674 | 550,693 |
Trade Names [Member] | ||
Indefinite-lived Intangible Assets (Excluding Goodwill) [Abstract] | ||
Gross Carrying Amount | 157,957 | 153,102 |
Net Carrying Amount | 157,957 | 153,102 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | 426,423 | 411,076 |
Accumulated Amortization | (189,469) | (162,722) |
Net Carrying Amount | 236,954 | 248,354 |
Intellectual Property [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | 225,396 | 216,359 |
Accumulated Amortization | (80,220) | (70,169) |
Net Carrying Amount | 145,176 | 146,190 |
Licensing Agreements [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | 6,559 | 6,559 |
Accumulated Amortization | (4,529) | (4,102) |
Net Carrying Amount | 2,030 | 2,457 |
Patents [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | 1,048 | 986 |
Accumulated Amortization | (732) | (666) |
Net Carrying Amount | 316 | 320 |
Noncompete Agreements [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | 810 | 813 |
Accumulated Amortization | (810) | (813) |
Net Carrying Amount | 0 | 0 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross Carrying Amount | 450 | 450 |
Accumulated Amortization | (209) | (180) |
Net Carrying Amount | $ 241 | $ 270 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS (Details Textuals) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | $ 20 | $ 20 | ||
Amortization expense related to intangible assets | 14.2 | $ 13.7 | 41.8 | $ 39.6 |
Estimated Amortization Expense, remainder of fiscal year | 14.3 | 14.3 | ||
Estimated Amortization Expense, for fiscal 2021 | 54.8 | 54.8 | ||
Estimated Amortization Expense, for fiscal 2022 | 48 | 48 | ||
Estimated Amortization Expense, for fiscal 2023 | 42.5 | 42.5 | ||
Estimated Amortization Expense, for fiscal 2024 | 37.8 | 37.8 | ||
Estimated Amortization Expense, for fiscal 2025 | 33.5 | 33.5 | ||
Estimated Amortization Expense, thereafter | $ 153.8 | $ 153.8 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Borrowings under revolving credit facility | $ 730,000 | $ 553,000 |
Finance leases and note payable | 10,089 | 8,955 |
Total debt and capital leases | 740,089 | 561,955 |
Current maturities of long-term debt | (1,073) | (906) |
Long-term debt, net of current maturities | $ 739,016 | $ 561,049 |
LONG-TERM DEBT (Details Textual
LONG-TERM DEBT (Details Textuals) | Jul. 31, 2020 | Oct. 31, 2019 |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Weighted average interest rate | 1.30% | 3.00% |
REVENUE (Contract Assets and Li
REVENUE (Contract Assets and Liabilities) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 31, 2020 | Oct. 31, 2019 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | ||
Contract assets | $ 59,113 | $ 43,132 |
Contract liabilities | 22,863 | 23,809 |
Net contract assets | 36,250 | $ 19,323 |
Change in Contract Assets | 15,981 | |
Change in Contract Liabilities | (946) | |
Change in Net Contract Asstes | $ 16,927 |
REVENUE (Disaggregation of Reve
REVENUE (Disaggregation of Revenue, by Product Line) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | ||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 386,410 | $ 532,324 | $ 1,360,831 | $ 1,514,118 | |
Flight Support Group [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 178,158 | 320,016 | 731,189 | 915,480 | |
Flight Support Group [Member] | Aftermarket Replacement Parts [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 102,629 | 173,992 | 412,088 | 500,714 |
Flight Support Group [Member] | Repair and Overhaul Parts and Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [2] | 32,601 | 76,270 | 154,517 | 216,887 |
Flight Support Group [Member] | Specialty Products [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [3] | 42,928 | 69,754 | 164,584 | 197,879 |
Electronic Technologies Group [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 210,919 | 216,129 | 638,285 | 615,009 | |
Electronic Technologies Group [Member] | Electronic Components for Defense, Space and Aerospace [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [4] | 165,189 | 160,031 | 494,864 | 459,445 |
Electronic Technologies Group [Member] | Other Electronic Components [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [5] | 45,730 | 56,098 | 143,421 | 155,564 |
Corporate And Eliminations [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ (2,667) | $ (3,821) | $ (8,643) | $ (16,371) | |
[1] | Includes various jet engine and aircraft component replacement parts. | ||||
[2] | Includes primarily the sale of parts consumed in various repair and overhaul services on selected jet engine and aircraft components, avionics, instruments, composites and flight surfaces of commercial and military aircraft. | ||||
[3] | Includes primarily the sale of specialty components such as thermal insulation blankets, renewable/reusable insulation systems, advanced niche components, complex composite assemblies, and expanded foil mesh. | ||||
[4] | Includes various component parts such as electro-optical infrared simulation and test equipment, electro-optical laser products, electro-optical, microwave and other power equipment, high-speed interface products, power conversion products, underwater locator beacons, emergency locator transmission beacons, traveling wave tube amplifiers, microwave power modules, three-dimensional microelectronic and stacked memory products, crashworthy and ballistically self-sealing auxiliary fuel systems, radio frequency (RF) and microwave amplifiers, transmitters and receivers, high performance communications and electronic intercept receivers and tuners, high performance active antenna systems, and technical surveillance countermeasures equipment. | ||||
[5] | Includes various component parts such as electromagnetic and radio interference shielding, high voltage interconnection devices, high voltage advanced power electronics, harsh environment connectivity products, custom molded cable assemblies and silicone material for a variety of demanding applications. |
REVENUE (Disaggregation of Re_2
REVENUE (Disaggregation of Revenue, by Industry) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | ||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 386,410 | $ 532,324 | $ 1,360,831 | $ 1,514,118 | |
Flight Support Group [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 178,158 | 320,016 | 731,189 | 915,480 | |
Flight Support Group [Member] | Aerospace [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 114,627 | 258,157 | 543,205 | 742,555 | |
Flight Support Group [Member] | Defense and Space [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 53,269 | 49,769 | 157,664 | 137,272 | |
Flight Support Group [Member] | Other Industries [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 10,262 | 12,090 | 30,320 | 35,653 |
Electronic Technologies Group [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 210,919 | 216,129 | 638,285 | 615,009 | |
Electronic Technologies Group [Member] | Aerospace [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 14,482 | 20,729 | 56,541 | 62,900 | |
Electronic Technologies Group [Member] | Defense and Space [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | 141,282 | 138,875 | 413,883 | 390,046 | |
Electronic Technologies Group [Member] | Other Industries [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | [2] | 55,155 | 56,525 | 167,861 | 162,063 |
Corporate And Eliminations [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ (2,667) | $ (3,821) | $ (8,643) | $ (16,371) | |
[1] | Principally industrial products. | ||||
[2] | Principally other electronics and medical products. |
REVENUE (Details Textuals)
REVENUE (Details Textuals) $ in Thousands | 3 Months Ended | 9 Months Ended |
Jul. 31, 2020USD ($) | Jul. 31, 2020USD ($) | |
REVENUE [Abstract] | ||
Contract with Customer, Liability, Revenue Recognized | $ 900 | $ 17,400 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-08-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 363,800 | $ 363,800 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year 1 day | 1 year 1 day |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-08-02 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 84,300 | $ 84,300 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 3 months | 3 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-11-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 279,500 | $ 279,500 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 3 months 1 day | 3 months 1 day |
INCOME TAXES (Details Textuals)
INCOME TAXES (Details Textuals) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Jul. 31, 2020 | Jan. 31, 2020 | Jul. 31, 2019 | Jan. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | Jan. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||||||
Effective Income Tax Rate Reconciliation, Percent | 13.40% | 22.00% | 3.50% | 17.10% | |||
Tax benefit from stock option exercises recognized in the period | $ 47.6 | $ 16.6 | |||||
Year Over Year, Deferred Tax Expense From Stock Option Exercised | $ 31 |
FAIR VALUE MEASUREMENTS (Fair V
FAIR VALUE MEASUREMENTS (Fair Value Hierarchy, by Category) (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | $ 177,932 | $ 151,891 |
Liabilities: | ||
Contingent consideration | 18,015 | 18,326 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 1,011 | 20 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 176,921 | 151,871 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 0 | 0 |
Liabilities: | ||
Contingent consideration | 18,015 | 18,326 |
Corporate Owned Life Insurance [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 176,921 | 151,871 |
Corporate Owned Life Insurance [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 0 | 0 |
Corporate Owned Life Insurance [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 176,921 | 151,871 |
Corporate Owned Life Insurance [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 0 | 0 |
Money Market Funds [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 1,011 | 20 |
Money Market Funds [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 1,011 | 20 |
Money Market Funds [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | 0 | 0 |
Money Market Funds [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Deferred Compensation Plans [Abstract] | ||
Deferred compensation plans | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS FAIR VA
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS (Level 3 Valuation Inputs) (Details) - FY 2017 Acquisition [Member] - Fair Value, Inputs, Level 3 [Member] | Jul. 31, 2020 |
Measurement Input, Long-term Revenue Growth Rate [Member] | Minimum [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Business Combination, Contingent Consideration, Liability, Measurement Input | (0.03) |
Measurement Input, Long-term Revenue Growth Rate [Member] | Maximum [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Business Combination, Contingent Consideration, Liability, Measurement Input | 0.10 |
Measurement Input, Discount Rate [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Business Combination, Contingent Consideration, Liability, Measurement Input | 0.033 |
FAIR VALUE MEASUREMENTS (Contin
FAIR VALUE MEASUREMENTS (Contingent Consideration Liability) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 31, 2020 | Jul. 31, 2019 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Change in value of contingent consideration | $ 189 | $ 3,734 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Opening balance, Liabilities | 18,326 | |
Change in accrued contingent consideration | 189 | |
Change in value of contingent consideration | (500) | |
Ending balance, Liabilities | $ 18,015 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details Textuals) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities | $ 18,015 | $ 18,326 |
Flight Support Group [Member] | FY2019 Acquisition [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High | 6,400 | |
Total liabilities | 0 | 1,100 |
Electronic Technologies Group [Member] | FY 2017 Acquisition [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High | 20,000 | |
Total liabilities | 18,000 | |
Aggregate LCP Liability [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Related liabilities of deferred compensation plans, specified as other long-term liabilities | $ 177,100 | $ 151,100 |
LEASES (ROU Assets and Lease Li
LEASES (ROU Assets and Lease Liabilities) (Details) $ in Thousands | Jul. 31, 2020USD ($) |
Leases [Abstract] | |
Right-of-use assets | $ 57,752 |
Current lease liabilities | 13,587 |
Long-term lease liabilities | 45,232 |
Total operating lease liabilities | $ 58,819 |
LEASES (Operating Lease Expense
LEASES (Operating Lease Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Jul. 31, 2020 | Jul. 31, 2020 | ||
Leases [Abstract] | |||
Operating lease expense | $ 4,311 | $ 12,855 | |
Variable lease expense | 619 | 1,942 | |
Total operating lease expense (1) | [1] | $ 4,930 | $ 14,797 |
[1] | Excludes short-term lease expense, which is not material. |
LEASES (Future minimum lease pa
LEASES (Future minimum lease payments) (Details) $ in Thousands | Jul. 31, 2020USD ($) |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
Current fiscal year | $ 3,639 |
Next fiscal twelve months | 16,377 |
Year Two | 14,394 |
Year three | 8,952 |
Year four | 5,115 |
Year five | 4,243 |
Thereafter | 18,566 |
Total minimum lease payments | 71,286 |
Less: amount representing interest | (12,467) |
Present value of minimum lease payments | $ 58,819 |
LEASES (Lease Term and Discount
LEASES (Lease Term and Discount Rate) (Details) | Jul. 31, 2020 |
Leases [Abstract] | |
Weighted average remaining lease term | 7 years |
Weighted average discount rate | 5.10% |
LEASES (Supplemental Cash Flow
LEASES (Supplemental Cash Flow Information) (Details) $ in Thousands | 9 Months Ended |
Jul. 31, 2020USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of lease liabilities | $ 12,652 |
Right-of-use assets obtained in exchange for new lease liabilities | $ 7,423 |
LEASES (Details Textuals)
LEASES (Details Textuals) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Item Effected [Line Items] | ||
Next fiscal twelve months | $ 16,377 | |
Year Two | 14,394 | |
Year three | 8,952 | |
Year four | 5,115 | |
Year five | 4,243 | |
Thereafter | $ 18,566 | |
Previous Accounting Guidance [Member] | ||
Item Effected [Line Items] | ||
Next fiscal twelve months | $ 15,500 | |
Year Two | 15,600 | |
Year three | 13,800 | |
Year four | 8,500 | |
Year five | 4,700 | |
Thereafter | $ 18,800 |
NET INCOME PER SHARE ATTRIBUT_3
NET INCOME PER SHARE ATTRIBUTABLE TO HEICO SHAREHOLDERS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Numerator: | ||||
Net income attributable to HEICO | $ 54,316 | $ 81,098 | $ 251,657 | $ 242,212 |
Denominator: | ||||
Weighted Average Number of Shares Outstanding, Basic | 134,837 | 133,970 | 134,676 | 133,405 |
Effect of dilutive stock options | 2,397 | 3,664 | 2,581 | 3,868 |
Weighted Average Number of Shares Outstanding, Diluted | 137,234 | 137,634 | 137,257 | 137,273 |
Earnings Per Share, Basic | $ 0.40 | $ 0.61 | $ 1.87 | $ 1.82 |
Earnings Per Share, Diluted | $ 0.40 | $ 0.59 | $ 1.83 | $ 1.76 |
Anti-dilutive stock options excluded | 250 | 88 | 272 | 439 |
OPERATING SEGMENTS (Details)
OPERATING SEGMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2020 | Jul. 31, 2019 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 386,410 | $ 532,324 | $ 1,360,831 | $ 1,514,118 |
Depreciation | 6,711 | 6,440 | 20,276 | 19,096 |
Amortization | 15,231 | 14,698 | 44,942 | 42,590 |
Operating Income (Loss) | 68,434 | 119,414 | 287,585 | 336,544 |
Capital expenditures | 5,037 | 9,075 | 17,472 | 21,671 |
Corporate And Eliminations [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (2,667) | (3,821) | (8,643) | (16,371) |
Depreciation | 249 | 251 | 760 | 754 |
Amortization | 246 | 246 | 738 | 738 |
Operating Income (Loss) | (5,518) | (7,589) | (18,960) | (24,459) |
Capital expenditures | 12 | 55 | 17 | 63 |
Flight Support Group [Member] | Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 178,158 | 320,016 | 731,189 | 915,480 |
Depreciation | 3,590 | 3,467 | 10,835 | 10,225 |
Amortization | 5,109 | 4,991 | 14,720 | 14,714 |
Operating Income (Loss) | 12,021 | 64,797 | 121,597 | 179,843 |
Capital expenditures | 1,624 | 6,024 | 8,389 | 12,600 |
Electronic Technologies Group [Member] | Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 210,919 | 216,129 | 638,285 | 615,009 |
Depreciation | 2,872 | 2,722 | 8,681 | 8,117 |
Amortization | 9,876 | 9,461 | 29,484 | 27,138 |
Operating Income (Loss) | 61,931 | 62,206 | 184,948 | 181,160 |
Capital expenditures | $ 3,401 | $ 2,996 | $ 9,066 | $ 9,008 |
OPERATING SEGMENTS (Assets) (De
OPERATING SEGMENTS (Assets) (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Oct. 31, 2019 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 3,423,250 | $ 2,969,211 |
Other Primarily Corporate and Intersegment [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 527,412 | 176,442 |
Flight Support Group [Member] | Operating Segments [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 1,153,879 | 1,149,737 |
Electronic Technologies Group [Member] | Operating Segments [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 1,741,959 | $ 1,643,032 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 31, 2020 | Jul. 31, 2019 | |
Schedule of Product Warranties [Line Items] | ||
Balances as of beginning of fiscal year | $ 2,810 | $ 3,306 |
Accruals for warranties | 1,472 | 1,652 |
Acquired warranty liabilities | 50 | |
Warranty claims settled | (1,259) | (1,974) |
Balances as of end of period | $ 3,073 | $ 2,984 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Details Textuals) $ in Thousands | Jul. 31, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Guarantor Obligations, Maximum Exposure, Undiscounted | $ 4,500 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] | 1 Months Ended | |
Aug. 27, 2020 | Aug. 01, 2020 | |
ID and TS [Member] | Noncontrolling Holders of a Subsidiary of Heico Electronics [Member] | ||
Subsequent Event [Line Items] | ||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 25.00% | |
ID and TS [Member] | Existing Management [Member] | ||
Subsequent Event [Line Items] | ||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 10.01% | |
ID and TS [Member] | Electronic Technologies Group [Member] | ||
Subsequent Event [Line Items] | ||
Business Acquisition, Percentage of Voting Interests Acquired | 75.00% | |
Name of Acquired Entity | Intelligent Devices, Inc. ("ID") and Transformational Security, LLC ("TS") | |
Description of Acquired Entity | ID and TS design, develop and manufacturer state-of-the-art Technical Surveillance Countermeasures (TSCM) equipment used to protect critical spaces from exploitation via wireless transmissions, technical surveillance and listening devices. | |
Connect Tech [Member] | Electronic Technologies Group [Member] | ||
Subsequent Event [Line Items] | ||
Business Acquisition, Percentage of Voting Interests Acquired | 89.99% | |
Name of Acquired Entity | Connect Tech Inc. ("Connect Tech") | |
Description of Acquired Entity | Connect Tech designs and manufacturers rugged, small-form-factor embedded computing solutions. Connect Tech's components are designed for very harsh environments and are primarily used in rugged commercial and industrial, aerospace and defense, transportation, and smart energy applications. |