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Index
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 2023
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to _______
Commission File Number: 001-04604
HEICO CORPORATION
(Exact name of registrant as specified in its charter)
Florida65-0341002
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer Identification No.)
3000 Taft Street, Hollywood, Florida
33021
(Address of principal executive offices)(Zip Code)
(954) 987-4000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $.01 par value per share HEINew York Stock Exchange
Class A Common Stock, $.01 par value per share HEI.ANew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer Accelerated filer Non-accelerated filer
Smaller reporting company Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No
The number of shares outstanding of each of the registrant’s classes of common stock as of May 22, 2023 is as follows:
Common Stock, $.01 par value
54,705,934 shares
Class A Common Stock, $.01 par value
82,298,200 shares


Index
HEICO CORPORATION

INDEX TO QUARTERLY REPORT ON FORM 10-Q

Page
Part I.Financial Information
Item 1.
Item 2.
Item 3.
Item 4.
Part II.Other Information
Item 1A.Risk Factors
Item 6.

1


Index
PART I. FINANCIAL INFORMATION; Item 1. FINANCIAL STATEMENTS

HEICO CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED
(in thousands, except per share data)
April 30, 2023October 31, 2022
ASSETS
Current assets:
Cash and cash equivalents$127,161 $139,504 
Accounts receivable, net361,057 294,848 
Contract assets103,448 93,978 
Inventories, net721,569 582,471 
Prepaid expenses and other current assets53,404 41,929 
Total current assets1,366,639 1,152,730 
Property, plant and equipment, net273,856 225,879 
Goodwill2,031,235 1,672,425 
Intangible assets, net844,319 733,327 
Other assets354,150 311,135 
Total assets$4,870,199 $4,095,496 
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt and current maturities of long-term debt$18,860 $1,654 
Trade accounts payable147,708 116,551 
Accrued expenses and other current liabilities296,159 290,199 
Income taxes payable4,101 12,455 
Total current liabilities466,828 420,859 
Long-term debt, net of current maturities735,779 288,620 
Deferred income taxes94,468 71,162 
Other long-term liabilities367,624 338,948 
Total liabilities1,664,699 1,119,589 
Commitments and contingencies (Note 11)
Redeemable noncontrolling interests (Note 3)345,833 327,601 
Shareholders’ equity:
Preferred Stock, $.01 par value per share; 10,000 shares authorized; none issued
  
Common Stock, $.01 par value per share; 150,000 shares authorized; 54,701 and 54,519 shares issued and outstanding
547 545 
Class A Common Stock, $.01 par value per share; 150,000 shares authorized; 82,278 and 82,093 shares issued and outstanding
823 821 
Capital in excess of par value398,991 397,337 
Deferred compensation obligation6,171 5,297 
HEICO stock held by irrevocable trust(6,171)(5,297)
Accumulated other comprehensive loss(17,626)(46,499)
Retained earnings2,435,155 2,253,932 
Total HEICO shareholders’ equity2,817,890 2,606,136 
Noncontrolling interests41,777 42,170 
Total shareholders’ equity2,859,667 2,648,306 
Total liabilities and equity$4,870,199 $4,095,496 
The accompanying notes are an integral part of these condensed consolidated financial statements.

2

Index
HEICO CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS – UNAUDITED
(in thousands, except per share data)
Six months ended April 30,Three months ended April 30,
2023202220232022
Net sales$1,308,756 $1,029,156 $687,841 $538,813 
Operating costs and expenses:
Cost of sales798,445 627,717 421,329 327,584 
Selling, general and administrative expenses223,787 179,840 109,422 88,452 
Total operating costs and expenses1,022,232 807,557 530,751 416,036 
Operating income
286,524 221,599 157,090 122,777 
Interest expense(17,441)(1,775)(11,373)(979)
Other income 982 540 343 314 
Income before income taxes and noncontrolling interests
270,065 220,364 146,060 122,112 
Income tax expense52,000 33,000 31,000 29,000 
Net income from consolidated operations218,065 187,364 115,060 93,112 
Less: Net income attributable to noncontrolling interests
19,918 15,433 9,940 8,102 
Net income attributable to HEICO$198,147 $171,931 $105,120 $85,010 
Net income per share attributable to HEICO shareholders:
Basic$1.45 $1.27 $.77 $.63 
Diluted$1.43 $1.25 $.76 $.62 
Weighted average number of common shares outstanding:
Basic136,786 135,763 136,916 135,891 
Diluted138,590 137,916 138,600 137,867 

The accompanying notes are an integral part of these condensed consolidated financial statements.



3



Index
HEICO CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME – UNAUDITED
(in thousands)
Six months ended April 30,Three months ended April 30,
2023202220232022
Net income from consolidated operations$218,065 $187,364 $115,060 $93,112 
Other comprehensive income (loss):
Foreign currency translation adjustments30,379 (23,028)1,994 (14,277)
Amortization of unrealized loss on defined benefit pension plan, net of tax
28 33 13 22 
Total other comprehensive income (loss) 30,407 (22,995)2,007 (14,255)
Comprehensive income from consolidated operations
248,472 164,369 117,067 78,857 
Net income attributable to noncontrolling interests
19,918 15,433 9,940 8,102 
Foreign currency translation adjustments attributable to noncontrolling interests
1,534 (993)275 (663)
Comprehensive income attributable to noncontrolling interests
21,452 14,440 10,215 7,439 
Comprehensive income attributable to HEICO$227,020 $149,929 $106,852 $71,418 

The accompanying notes are an integral part of these condensed consolidated financial statements.



4



Index
HEICO CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - UNAUDITED
For the Six Months Ended April 30, 2023 and 2022
(in thousands, except per share data)
HEICO Shareholders' Equity
Redeemable Noncontrolling InterestsCommon StockClass A Common StockCapital in Excess of Par ValueDeferred Compensation ObligationHEICO Stock Held by Irrevocable TrustAccumulated Other Comprehensive LossRetained EarningsNoncontrolling InterestsTotal Shareholders' Equity
Balances as of October 31, 2022$327,601 $545 $821 $397,337 $5,297 ($5,297)($46,499)$2,253,932 $42,170 $2,648,306 
Comprehensive income 15,356 — — — — — 28,873 198,147 6,096 233,116 
Cash dividends ($.10 per share)
— — — — — — — (13,668)— (13,668)
Issuance of common stock to HEICO Savings and Investment Plan
— — — 7,760 — — — — — 7,760 
Share-based compensation expense
— — — 6,055 — — — — — 6,055 
Proceeds from stock option exercises
— 2 2 4,070 — — — — — 4,074 
Redemptions of common stock related to stock option exercises
— — — (14,811)— — — — — (14,811)
Noncontrolling interests assumed related to acquisitions14,642 — — — — — — — — — 
Distributions to noncontrolling interests
(16,161)— — — — — — — (6,489)(6,489)
Acquisitions of noncontrolling interests(1,059)— — (1,674)— — — — — (1,674)
Adjustments to redemption amount of redeemable noncontrolling interests
3,103 — — — — — — (3,103)— (3,103)
Deferred compensation obligation— — — — 874 (874)— — — — 
Other
2,351 — — 254 — — — (153)— 101 
Balances as of April 30, 2023$345,833 $547 $823 $398,991 $6,171 ($6,171)($17,626)$2,435,155 $41,777 $2,859,667 

HEICO Shareholders' Equity
Redeemable Noncontrolling InterestsCommon StockClass A Common StockCapital in Excess of Par ValueDeferred Compensation ObligationHEICO Stock Held by Irrevocable TrustAccumulated Other Comprehensive LossRetained EarningsNoncontrolling InterestsTotal Shareholders' Equity
Balances as of October 31, 2021$252,587 $543 $812 $320,747 $5,297 ($5,297)($8,552)$1,949,521 $33,868 $2,296,939 
Comprehensive income (loss)9,262 — — — — — (22,002)171,931 5,178 155,107 
Cash dividends ($.09 per share)
— — — — — — — (12,227)— (12,227)
Issuance of common stock to HEICO Savings and Investment Plan
— — — 7,739 — — — — — 7,739 
Share-based compensation expense
— — — 6,855 — — — — — 6,855 
Proceeds from stock option exercises
— 3 3 1,604 — — — — — 1,610 
Redemptions of common stock related to stock option exercises
— (1)(1)(23,690)— — — — — (23,692)
Noncontrolling interests assumed related to acquisitions39,235 — — — — — — — — — 
Distributions to noncontrolling interests
(9,968)— — — — — — — (608)(608)
Adjustments to redemption amount of redeemable noncontrolling interests
9,047 — — — — — — (9,047)— (9,047)
Other
3,764 — — (2,202)— — — — — (2,202)
Balances as of April 30, 2022$303,927 $545 $814 $311,053 $5,297 ($5,297)($30,554)$2,100,178 $38,438 $2,420,474 
The accompanying notes are an integral part of these condensed consolidated financial statements.



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HEICO CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - UNAUDITED
For the Three Months Ended April 30, 2023 and 2022
(in thousands, except per share data)
HEICO Shareholders' Equity
Redeemable Noncontrolling InterestsCommon StockClass A Common StockCapital in Excess of Par ValueDeferred Compensation ObligationHEICO Stock Held by Irrevocable TrustAccumulated Other Comprehensive LossRetained EarningsNoncontrolling InterestsTotal Shareholders' Equity
Balances as of January 31, 2023$340,287 $547 $822 $388,603 $6,171 ($6,171)($19,358)$2,328,523 $45,037 $2,744,174 
Comprehensive income7,376 — — — — — 1,732 105,120 2,839 109,691 
Issuance of common stock to HEICO Savings and Investment Plan
— — — 5,796 — — — — — 5,796 
Share-based compensation expense
— — — 3,243 — — — — — 3,243 
Proceeds from stock option exercises
— — 1 1,228 — — — — — 1,229 
Redemptions of common stock related to stock option exercises
— — — (6)— — — — — (6)
Noncontrolling interests assumed related to acquisitions2,592 — — — — — — — — — 
Distributions to noncontrolling interests
(5,260)— — — — — — — (6,099)(6,099)
Adjustments to redemption amount of redeemable noncontrolling interests
(1,513)— — — — — — 1,513 — 1,513 
Other
2,351 — — 127 — — — (1)— 126 
Balances as of April 30, 2023$345,833 $547 $823 $398,991 $6,171 ($6,171)($17,626)$2,435,155 $41,777 $2,859,667 

HEICO Shareholders' Equity
Redeemable Noncontrolling InterestsCommon StockClass A Common StockCapital in Excess of Par ValueDeferred Compensation ObligationHEICO Stock Held by Irrevocable TrustAccumulated Other Comprehensive LossRetained EarningsNoncontrolling InterestsTotal Shareholders' Equity
Balances as of January 31, 2022$258,289 $545 $814 $302,104 $5,297 ($5,297)($16,962)$2,018,990 $36,565 $2,342,056 
Comprehensive income (loss)5,121 — — — — — (13,592)85,010 2,318 73,736 
Issuance of common stock to HEICO Savings and Investment Plan
— — — 6,069 — — — — — 6,069 
Share-based compensation expense
— — — 3,241 — — — — — 3,241 
Proceeds from stock option exercises
— — — 841 — — — — — 841 
Redemptions of common stock related to stock option exercises
— — — (69)— — — — — (69)
Noncontrolling interests assumed related to acquisitions39,063 — — — — — — — — — 
Distributions to noncontrolling interests
(4,085)— — — — — — — (445)(445)
Adjustments to redemption amount of redeemable noncontrolling interests
3,822 — — — — — — (3,822)— (3,822)
Other
1,717 — — (1,133)— — — — — (1,133)
Balances as of April 30, 2022$303,927 $545 $814 $311,053 $5,297 ($5,297)($30,554)$2,100,178 $38,438 $2,420,474 

The accompanying notes are an integral part of these condensed consolidated financial statements.




6




HEICO CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
(in thousands)
Six months ended April 30,
20232022
Operating Activities:
Net income from consolidated operations$218,065 $187,364 
Adjustments to reconcile net income from consolidated operations to net cash provided by operating activities:
Depreciation and amortization56,784 46,707 
Employer contributions to HEICO Savings and Investment Plan6,533 5,364 
Share-based compensation expense6,055 6,855 
Increase (decrease) in accrued contingent consideration, net1,842 (1,773)
Amendment and termination of contingent consideration agreement(9,057) 
Payment of contingent consideration(6,299) 
Deferred income tax (benefit) provision(9,596)2,080 
Changes in operating assets and liabilities, net of acquisitions:
Increase in accounts receivable(21,222)(20,263)
(Increase) decrease in contract assets (9,267)1,778 
Increase in inventories(75,251)(42,766)
Decrease (increase) in prepaid expenses and other current assets1,738 (8,974)
Increase in trade accounts payable6,797 8,137 
Decrease in accrued expenses and other current liabilities(2,671)(15,946)
Decrease in income taxes payable(13,824)(9,343)
Net changes in other long-term liabilities and assets related to
   HEICO Leadership Compensation Plan
10,563 13,356 
Other(6,754)2,177 
Net cash provided by operating activities154,436 174,753 
Investing Activities:
Acquisitions, net of cash acquired(524,231)(105,533)
Capital expenditures(21,921)(16,211)
Investments related to HEICO Leadership Compensation Plan (14,000)(11,700)
Other362 (10,511)
Net cash used in investing activities(559,790)(143,955)
Financing Activities:
Borrowings on revolving credit facility556,000 93,000 
Payments on revolving credit facility(108,000)(65,000)
Distributions to noncontrolling interests(22,650)(10,576)
Redemptions of common stock related to stock option exercises(14,811)(23,692)
Cash dividends paid(13,668)(12,227)
Payment of contingent consideration (12,610) 
Acquisitions of noncontrolling interests(2,733) 
Proceeds from stock option exercises4,074 1,610 
Other3,163 (1,220)
Net cash provided by (used in) financing activities388,765 (18,105)
Effect of exchange rate changes on cash4,246 (3,673)
Net (decrease) increase in cash and cash equivalents(12,343)9,020 
Cash and cash equivalents at beginning of year139,504 108,298 
Cash and cash equivalents at end of period$127,161 $117,318 
The accompanying notes are an integral part of these condensed consolidated financial statements.
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HEICO CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS – UNAUDITED

1.     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, 2022. The October 31, 2022 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 six months ended
April 30, 2023 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. ("HFSC") and their respective subsidiaries; and the Electronic Technologies Group (“ETG”), consisting of HEICO Electronic Technologies Corp. and its subsidiaries.

Although the Company has largely emerged from the COVID-19 pandemic, HEICO’s results of operations in fiscal 2023 continue to reflect some of the pandemic’s lingering effects, including its impact on the Company's supply chain. Despite the aforementioned, the Company experienced continued improvement in operating results in the first six months and second quarter of fiscal 2023 as compared to the first six months and second quarter of fiscal 2022 principally reflecting improved demand for its commercial aerospace products and services. The FSG has reported eleven consecutive quarters of sequential growth in net sales and operating income resulting from commercial air travel recovery in certain domestic travel markets, moderated by a slower recovery in international travel markets.

New Accounting Pronouncement

In October 2021, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2021-08, "Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers," which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the
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acquirer on the acquisition date in accordance with ASC 606, "Revenue from Contracts with Customers," as if the acquirer had originated the contracts. The Company adopted ASU 2021-08 in the first quarter of fiscal 2023, resulting in no material effect on the Company's consolidated results of operations, financial position or cash flows.


2.     ACQUISITIONS

In March 2023, the Company, through a subsidiary of HEICO Electronic, entered into an exclusive license and acquired certain assets for the Aircraft Emergency Locator Transmitter (“ELT”) product line from Honeywell International. ELTs provide critical emergency transmission signals in the event of aircraft impact on land or water to enable first responders to locate the aircraft. The transaction provides the HEICO Electronic subsidiary with all rights to produce, sell and repair both fixed and portable Honeywell ELTs, as well as various support equipment. The purchase price of this acquisition was paid in cash using cash provided by operating activities and is not material or significant to the Company's condensed consolidated financial statements.

On January 5, 2023, the Company, through HEICO Electronic, acquired 93.69% of the outstanding common stock and all of the preferred stock of Exxelia International SAS (“Exxelia”). Exxelia designs, manufactures and sells high reliability (“Hi-Rel”), complex, passive electronic components and rotary joint assemblies for mostly aerospace and defense applications, in addition to other high-end applications, such as medical and energy uses, including emerging “clean energy” and electrification applications. The Company believes that this acquisition will further HEICO's strategy of expanding its already wide range of mission-critical and Hi-Rel components for the most demanding applications, as well as provide HEICO with added broad geographic and product diversity, including in the important European market. The remaining 6.31% interest is owned by certain members of Exxelia's management team (see Note 3, Selected Financial Statement Information - Redeemable Noncontrolling Interests, for additional information). Additionally, as a result of this acquisition, the Company also obtained a 90% ownership interest in Alcon Electronics Pvt. Ltd. (“Alcon”), which is an existing subsidiary of Exxelia. The remaining 10% interest continues to be owned by a certain member of Alcon’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 proceeds from the Company's revolving credit facility.

The following table summarizes the total consideration for the acquisition of Exxelia (in thousands):
Cash paid
$515,785 
Less: cash acquired
(14,234)
Total consideration paid, net$501,551 


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As noted above, the Company acquired all of the preferred stock of Exxelia. Pursuant to the terms of the acquisition, Exxelia’s preferred stock accrues dividends at 5.18% per annum. Additionally, in connection with the acquisition, HEICO issued Exxelia a ten-year, €150 million note, which accrues interest at 4.7% per annum on the principal outstanding. The Company records foreign currency transaction adjustments on the note receivable within selling, general and administrative ("SG&A") expenses in its Condensed Consolidated Statements of Operations.

The following table summarizes the allocation of the total consideration for the acquisition of Exxelia to the estimated fair values of the tangible and identifiable intangible assets acquired and liabilities and noncontrolling interests assumed (in thousands):
Assets acquired:
Goodwill $332,033 
Customer relationships 64,935 
Intellectual property44,044 
Trade name21,703 
Inventories55,922 
Property, plant and equipment42,165 
Accounts receivable41,113 
Other assets 11,254 
Total assets acquired, excluding cash 613,169 
Liabilities assumed:
Deferred income taxes31,975 
Accounts payable22,369 
Accrued expenses 18,383 
Other liabilities 24,231 
Total liabilities assumed 96,958 
Noncontrolling interests in consolidated subsidiaries
14,660 
Net assets acquired, excluding cash$501,551 

The allocation of the total consideration 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. The primary items that generated the goodwill recognized were the premiums paid by the Company for the future earnings potential of Exxelia and the value of its assembled workforce that do not qualify for separate recognition, however, benefit both the Company and the noncontrolling interest holders. The fair value of the noncontrolling interests were determined based on the consideration paid by the Company for its controlling ownership interest adjusted for a lack of control that a market participant would consider when estimating the fair value of the noncontrolling interest. The weighted-average amortization periods of the customer relationships, intellectual property and trade names
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acquired are 15 years, 15 years and indefinite, respectively. Acquisition costs associated with the purchase of Exxelia totaled $5.2 million for the six months ended April 30, 2023 and were recorded as a component of SG&A expenses in the Company's Condensed Consolidated Statement of Operations. The operating results of Exxelia were included in the Company’s results of operations from the effective acquisition date. The Company's consolidated net sales for the six and three months ended April 30, 2023, includes approximately $69.6 million and $54.6 million, respectively, from the acquisition of Exxelia. Net income attributable to HEICO for the six and three months ended April 30, 2023, was not materially impacted by the acquisition of Exxelia.

The following table presents unaudited pro forma financial information for the six and three months ended April 30, 2023 and April 30, 2022 as if the acquisition of Exxelia had occurred as of November 1, 2021 (in thousands, except per share data):
Six months ended April 30, Three months ended April 30,
2023202220232022
Net sales$1,348,159 $1,125,052 $687,841 $586,039 
Net income from consolidated operations
$234,185 $173,002 $115,568 $85,883 
Net income attributable to HEICO$213,969 $157,855 $105,544 $77,901 
Net income per share attributable to HEICO shareholders:
Basic
$1.56 $1.16 $.77 $.57 
Diluted
$1.54 $1.14 $.76 $.57 

The pro forma financial information is presented for comparative purposes only and is not necessarily indicative of the results of operations that actually would have been achieved if the acquisition had taken place as of November 1, 2021. The unaudited pro forma financial information includes adjustments to historical amounts such as increased interest expense associated with borrowings to finance the acquisition, foreign currency transaction adjustments on the note receivable from Exxelia, the reclassification of acquisition costs associated with the purchase of Exxelia from fiscal 2023 to fiscal 2022, additional amortization expense related to the intangible assets acquired, and inventory purchase accounting adjustments charged to cost of sales as the inventory is sold. Additionally, the pro forma information presented above reflects HEICO's initial ownership interest of 93.69% of Exxelia's common stock as of the date of acquisition. During the second quarter of fiscal 2023, the Company sold an additional 2.72% of the common stock of Exxelia to its existing noncontrolling interest holders and certain members of Exxelia's management team, which decreased the Company's ownership interest in the subsidiary to 90.97% (see Note 3, Selected Financial Statement Information - Redeemable Noncontrolling Interests, for additional information).



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3.     SELECTED FINANCIAL STATEMENT INFORMATION

Accounts Receivable
(in thousands)April 30, 2023October 31, 2022
Accounts receivable$371,708 $303,181 
Less: Allowance for doubtful accounts(10,651)(8,333)
Accounts receivable, net$361,057 $294,848 

Inventories
(in thousands)April 30, 2023October 31, 2022
Finished products$353,668 $285,024 
Work in process69,700 59,739 
Materials, parts, assemblies and supplies298,201 237,708 
Inventories, net of valuation reserves$721,569 $582,471 

Property, Plant and Equipment
(in thousands)April 30, 2023October 31, 2022
Land$19,232 $17,579 
Buildings and improvements168,689 148,598 
Machinery, equipment and tooling360,894 322,252 
Construction in progress23,578 14,533 
572,393 502,962 
Less: Accumulated depreciation and amortization(298,537)(277,083)
Property, plant and equipment, net$273,856 $225,879 

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 $19.5 million as of April 30, 2023 and $17.9 million as of October 31, 2022. The total customer rebates and credits deducted within net sales for the six months ended April 30, 2023 and 2022 was $4.2 million and $