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Heico’s (NYSE:HEI) stock on Tuesday fell 7.9%, a day after the maker of aerospace and defense parts reported second-quarter results.
The company disclosed higher debt in proportion to its profit since last year. Net debt quadrupled to $625.7 million in Q2 from $148.6 million six months earlier, but was down from $640.2 million in Q1.
Heico’s (HEI) net debt-to-net income ratio increased to 2.0 times in Q2 from 0.83 times in Q4. The company attributed the increased debt mostly to its approximately $453 million acquisition of Exxelia International in January.
Heico (HEI) also reported results that beat the average estimate among Wall Street analysts as a recovery in aerospace demand drove sales. The company’s Q2 net income rose 24% to $105.1 million, or $0.76 a share, from $85.0 million, or $0.62 a share, a year earlier. Analysts had forecast EPS of $0.73.
Net sales rose 28% to $687.8 million, compared with the consensus estimate of $675.9 million.
The company this month agreed to buy Wencor Group for $1.9 billion in cash and $150 million in Heico (HEI) shares.
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