Ladies and gentlemen, thank you for standing by, and welcome to the HEICO's Fiscal 2014 fourth quarter and full year financial results. At this time all participants’ line has been placed in a listen-only mode. Before we begin I would like to inform you that certain statements made in this call will constitute forward-looking statements which are subject to risks, uncertainties and contingencies. HEICO's actual results may differ materially from those expressed in or implied by these forward-looking statements as a result of factors including, but not limited to lower demand for commercial air travel or airline fleet changes or airline purchasing decisions which could cause lower demand for our goods and services, product development or products, specification cost and requirements which could cause an increase to our cost to complete contracts, governmental and regulatory demands, export policies and restrictions, reductions in defense, space or Homeland Security spending by US and/or foreign customers or competition from existing and new competitors which could reduce our sales, our ability to introduce new products and product pricing levels which could reduce our sales or sales growth, product development difficulty which could increase our product development costs and delay sales, our ability to make acquisitions and achieve operating synergies from acquired businesses, customer credit risk, interest and income tax rates and economic conditions within and outside of the aviation and space, medical, telecommunications and electronic industries which could negatively impact our costs and revenues, and defense budget cuts which could reduce our defense-related revenue. Those listening to this call are encouraged to review all of HEICO's filings with the Securities and Exchange Commission including but not limited to the filings on Form 10-K, Form 10-Q, and Form 8-K. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by applicable law. I would now like to turn the call over to HEICO’s Chairman and CEO Laurans Mendelson. Sir, you may begin.

Thank you very much, and good morning to everyone the call. We do appreciate you joining us and we welcome you to HEICO’s fourth quarter and full year fiscal ‘14 earnings teleconference. I am Larry Mendelson, Chairman and CEO of HEICO Corporation, and I am joined here this morning by Eric Mendelson, HEICO's Co-President and President of HEICO's Flight Support Group; Victor Mendelson, HEICO's Co-President and President of HEICO's Electronic Technologies Group; Tom Irwin, HEICO's Senior Executive Vice President; and Carlos Macau, our Executive Vice President and CFO. Now before reviewing our operating results in detail, I would like to take a few minutes to summarize the highlights of our fourth quarter and our full year fiscal results. Consolidated fourth quarter fiscal ‘14 net sales represent record quarterly results and that was driven principally by continued organic growth within Flight Support and continued year-over-year net sales growth within ETG. Consolidated net income per diluted share increased 9% to $0.48 in the fourth quarter of fiscal ‘14 and that’s up from $0.44 in the fourth quarter of fiscal ‘13. Consolidated full year fiscal ‘14 net sales operating income, net operating cash flow and net income represent record results principally driven by record net sales and operating income within Flight Support. Consolidated fiscal year ‘14 net income and operating income are up 18% and 11% on a 12% increase in net sales over fiscal ‘13. Our consolidated operating margin remained robust at 18% in fiscal ‘14 and was comparable to fiscal ‘13. Consolidated net income per diluted share increased 18% to $1.80 in fiscal ‘14, up from 153 in fiscal ‘13. The Flight Support Group set an all-time annual net sales record in fiscal ‘14 increasing 15% over fiscal ‘13 and that increase principally reflects organic growth of approximately 9% and additional…

Thank you. The Flight Support Group net sales increased 15% to a record $762.8 million in fiscal year 2014 up from $665.1 million in fiscal year 2013. This increase resulted from organic growth of approximately 9% as well as additional net sales of $37.7 million from a fiscal ’13 acquisition. This organic growth principally reflects new product offerings and continued favorable market conditions in the commercial aerospace sector resulting in net sales increases within our aftermarket replacement, parts and repair and overhaul services product lines. The Flight Support Group’s net sales increased 3% to $194.8 million in the fourth quarter of fiscal ’14 up from $189.6 million in the fourth quarter of fiscal ’13. All of this increase was generated by low double-digit organic growth in our aerospace markets reflecting new product offerings and continued favorable market conditions within our aftermarket replacements, parts and repair and overhaul services product lines partially offset by softer demand for certain industrial and defense related products within our specialty product lines. The Flight Support Group’s operating income totaled $33.2 million and $34.9 million in the fourth quarter of fiscal ’14 and fiscal ’13 respectively. The decrease in fourth quarter of fiscal ’14 principally reflects a lower gross profit margin resulting from the previously mentioned decrease in demand for certain products within our specialty product line. The Flight Support Group’s operating income increased 12% to a record $136.5 million in fiscal ’14 up from a $122.1 million in fiscal ’13. The result in fiscal ’14 is principally attributed to the previously mentioned net sales growth. The Flight Support Group’s operating margin was 17.0% and 17.9% in the fourth quarter and full fiscal year ’14 respectively as compared to 18.4% in both the fourth quarter and full fiscal year of ’13. The decrease in both the fourth quarter and in the full fiscal year of ’14 principally reflects the previously mentioned impact of decreases in demand for certain products within our specialty product lines as well as increases in certain SG&A expenses to support the higher net sales volumes in our commercial aerospace business. With respect to fiscal ’15, we currently estimate growth in the Flight Support Group’s full year net sales of approximately 8% to 10% and a full year Flight Support Group operating margin approximating that a fiscal ’14. This growth largely excludes any potential benefit from increased utilization of existing aircraft due to lower fuel prices. Now I would like to introduce Victor Mendelson, Co-President of HEICO and President of HEICO’s Electronic Technologies Group to discuss the results of the Electronic Technologies Group.

Thank you, Eric. The Electronic Technologies Group’s net sales increased 8% to a record $379.4 million in the fiscal year 2014 up from $350.0 million in the fiscal year ‘13 respectively. The fiscal year's increase is attributed to organic growth of approximately 2% as well as additional net sales of $23.5 million from a fiscal 2013 acquisition. The organic growth principally reflects an increase in demand for the Electronic Technologies Group's space and aerospace products partially offset by the previously anticipated decrease in demand for certain of our defense products. The Electronic Technologies Group's net sales increased to $100.1 million in the fourth quarter of fiscal 2014, up from $99.9 million in the fourth quarter of fiscal 2013. This increase came mostly from additional net sales of $4.4 million from a fiscal 2013 acquisition. The Electronic Technologies Group's operating income increased 7% to a record $88.9 million in the fiscal ‘14 up from $83.1 million in the fiscal ‘13 and increased 3% to $26.4 million in the fourth quarter of fiscal ‘14 up from $25.8 million in the fourth quarter of fiscal ‘13. The increase in the full year of fiscal ‘14 principally reflects the previously mentioned organic net sales as well as reductions in accrued contingent consideration partially offset by less favorable product mix, impairment losses and lower than expected operating income from a fiscal ‘13 acquisition. During the fourth quarter, we reduced the estimated fair value of contingent consideration and impaired certain intangible assets associated with the fiscal 12 acquisition that resulted in a net benefit to diluted earnings of $0.03 per share. Additionally net income per diluted share in fiscal ‘14 includes accumulative net $0.12 per share benefit from the previously mentioned and reported reduction in accrued contingent consideration related to a fiscal ‘13 acquisition that was partially offset by the impairment losses related to write-down of certain intangible assets and lower than expected operating income at the acquired business. The Electronic Technologies Group’s operating margin improved to 26.4% in the fourth quarter of fiscal ‘14 up from 25.8% in the fourth quarter of fiscal ‘13 and was 23.4% in the fiscal year ended 14, which approximated the 23.7% we saw in fiscal ‘13. The increase in the fourth quarter of fiscal ‘14 mainly resulted from the net impact of the previously mentioned reduction in contingent consideration partially offset by the less favorable product mix and impairment losses. With respect to fiscal 2015, we currently estimate the Electronic Technologies Group's full year net sales growth and full year operating margin to approximate that of fiscal 2014. At this point, I’ll turn the call back over to Laurans Mendelson.

Thank you, Victor. Moving onto diluted earnings per share, consolidated net income per diluted share increased 18% to $1.80 in fiscal ‘14 and that was up from $1.53 in fiscal ‘13 and an increase 9% to $0.48 in the fourth quarter of fiscal ‘14 up from $0.44 in the fourth quarter of fiscal ‘13. The increase in full fiscal ‘14 and fourth quarter principally reflects the previously mentioned record consolidated sales growth as well as the net benefits from the previously mentioned ETG Group acquisition. Depreciation and amortization expense increased by about $600,000 and $11 million in the fourth quarter and full fiscal ‘14 and that was up from $10.9 million and $36.8 million in the fourth quarter and full fiscal ‘13. That increase principally reflects the incremental impact of higher amortization expense related to intangible assets and depreciation expense attributable to fiscal ‘13 acquisitions. Research and development expense was consistent in the fourth quarter fiscal ‘14 and ‘13 both periods approximated $9 million. For the full fiscal ’14, R&D expense increased 14% to $37.4 million and that was up from $32.9 million in fiscal year 13. Significant ongoing new product development efforts are continuing at both Flight Support and ETG as we continue to invest between 3% and 4% of each sales dollar into new product development to support future growth strategies. As you all know HEICO focuses and concentrates on R&D development to introduce new products as well as improving existing products. That is a major strategy that adhere to and we feel that has been the single most important driver of HEICO’s growth over the past 20 years. SG&A expense decrease 4% to $49.2 million in the fourth quarter of fiscal ‘14 that was down from $51 million in the fourth quarter our fiscal ‘13 that decrease…

Thank you. (Operator Instructions) Our first question comes from the line of J.B. Groh of D.A. Davidson.

Maybe Victor could you go through the stock markets and ETG and talk about where there is any strengths or weakness looks like organic was a little low for the quarter which is probably driven by military, could you maybe talk about the other markets there and what you’re seeing?

Yes, J. B., this is Victor. I think you hit nail on the head in terms larger market for us or one of larger markets in ETG being soft in the quarter in the year in particular and the strength I think for us that we saw throughout the year was really on the space side and that’s really commercial space. We generally put defense space into defense. Our commercial aviation businesses were strong as well so those were pretty good. In the fourth quarter, I think a number of markets were also weaker I think we saw that in our general markets as well as actually in aerospace, but I wouldn’t get too caught up on the quarters as you’ve heard me say before. As a rule of thumb we can have weakness or apparent weakness in a very short period of time and then all of sudden you see it’s snapped back in the following quarter and that could be because orders are delayed or we have a technical issue that’s pushed something into the next quarter or it just the normal shifting cycle and we expected the quarter to be weaker. So generally I would look over the full course of the year.

Okay. And then the reversal that was, if my math is correct 2.5 points of margin benefit in the quarter roughly.

I’m going let Carlos address that point.

Yes. Hi, this is Carlos Macau. The reversal particularly for the quarter, if you look at it, it had a net bump to the quarter a little bit 2 million related to the fourth quarter. The full fiscal year was kind of a wash when you take in the consideration the contingent -- impairments the incremental short fall in earnings and the incremental amortization charges that we didn’t have to take as result to right off it was the push. So, that’s the answer to that question.

Okay. And then Larry I noticed that your net income in revenue guidance the 8% to 10% that it looks like your cash flow guidance is only up about 5%, is there anything in there that we should -- cash flow from operations up about 5%, is there anything in there we should be aware of is it working capital needs greater next year the normal or --?

No I think it’s probably a general tendency to conservatives and we really don’t know, but we rather focus on lower side and as you know we move these things up I can’t guarantee we will, but it’s just an early part of the year guestimate. Remember and I you know this that; we’re only through really one month November in fiscal year we’re not even done with December. So I think it just a conservative guestimate and obviously we would hope to do better than that.

And then can be same said for the CapEx guidance of 25 versus 16 this year I think in the past you kind of said, look, this is sort of wish list and not all that make it spent is that how you’re looking at?

That’s exactly correct; you have that 100% correct.

Our next question comes from the line of Tyler Hojo of Sidoti & Company.

Good morning. Just I guess the first question for the Flight Support group I guess this isn’t the first time we’ve heard that specialty products is a headwind but I’m wondering you can maybe give us a little bit of additional detail in regards to what the growth rate might have look like for commercial aftermarket if you excluded specialty products. And also if you can maybe remind us just how big of piece of the segment is that today?

Hi Tyler this is Eric. Again just as a little bit of background the specialty products group is highly successful, it does a lot of aerospace as well as have some industrial product sales as well as some defense sales. And basically the headwind that we faced in the fourth quarter and that we will face next year is that we completed a contract which was a multiyear contract it was fairly large and it -- we completed according to the terms of the contract. And the underlying product that we stored is not going to be required any longer it’s now like we loss the business it’s just not going to be required because that actually turns out the application did not run as hard as the original manufacturers thought that it would. So we think that it is a unique situation and we don’t anticipate any -- down affects to any other businesses or any other products that business sale. In addition there was a delay in receiving basically certain products for the fine military market we haven’t received those contract so that impacted us in the fourth quarter as well. As far as percentage sales increases again commercial aerospace is the best majority of our flight support growth and that business remains quite strong in terms of percentage so I make sure I get them all. So consolidated aerospace sales were up 13% on a consolidated basis and really the only headwind was in this basically specialty products area.

Got it, okay and maybe just in terms of the end market mix I think you guys usually provide that I guess you said commercial aviations up 13% or so, how about what percentage of sales was defense and space and other?

Well, the defense market was about 17% for the full fiscal year for the company on a consolidated basis.

Okay.

Space was slightly under 10%.

Say that again, I’m sorry Carlos.

Space was slightly under 10% on a combined basis.

Okay, got it. And maybe just another question, you mentioned several times through kind of the prepared remarks that kind of a benefit from kind of older capacity coming back in isn’t included in your guidance, I mean if you have the guess I know it’s a tough question but assuming oil kind of remains in this range for the year, what do you think that growth could look like for the FSG segment?

That is Tyler a very very good question and it’s very hard to figure out. It really depends what the airlines want to do with their retirement plans. They had planned on retiring certain aircraft, the retirement of those aircrafts are embedded in our forecast, if they in fact delayed retirement to the aircraft because demand for a passenger seat miles remains strong and they in fact decide to keep those air craft in service then that will help us. It is really too hard to quantify especially at this point I mean oil has really made its move in the last couple of weeks in particular nobody expects that to rebound anytime soon and it’s just a complex equation and something that we really we’re not able to bet into our forecast. So, I would say that it’s just too early to tell I mean to the extent perhaps also that airlines reduce some of the fuel surcharges and reduce prices maybe that will also help to stimulate the demand as consumers have more money to spend at businesses non-oil patch oil related businesses have more money to spend as well and that could help but honestly it is, I couldn’t even guess at this point as to what it is? We know that we believe it can only help, it will not hurt us, it can only help the only question is to what extent and maybe we’ll have some more color on that in our first quarter conference call which should be at the end of February 2015 but until then it really is too hard to figure out.

Our next question comes from the line of Michael Ciarmoli of KeyBanc Capital Management.

Maybe Carlos or Tom I guess just I think you guys said SG&A spending was up a bit and then if I look out to next year, it doesn’t appear like you’re getting a lot of leverage, operating leverage on the sales growth in your businesses I mean, is there anything you guys are looking at I mean I guess margins expected to be flat next year I mean are you guys looking at any kind of cost cutting or any kind of initiatives to maybe unlock some margin expansion or should we be thinking as you guys are kind of running at maybe the highest capacity you can with these margins. So just looking for some color on maybe what kind of expansion potentials in the margins?

Hi Michael, it’s Eric. I’ll go ahead and start out and then Carlos will finish but with regard to the FSG, the Flight Support Group segment we’ve always said that margins run and really that sort of 17% to 19% and they bounce around. When we had the impact as a result of the specialty products drop in the industrial sales as well as some of the expense relates sales, we have some excess basically operating cost embedded in those businesses and we weren’t able to if you will full absorb them as we normally would do within the commercial aerospace we were quite strong and we believe that we’ve got an incredible team and that’s why we’re able as a team to deliver these results and we made sure that that people are rewarded accordingly and I would say nothing is changed in terms of our guidance that’s the margins will pop around and if you’ll 17% to 19% area and sometimes it’s a little higher sometimes it’s a little lower. Carlos can add some specific color to the percentages.

Yes, I would agree with what Eric just said and I think it’s early to tell right now and our primary forecast we have assumed stable margins if we’re able to do better which we hope too, we might see a slight improvement in our OI margin that’s yet to come, it’s too early in the year to make that predication.

And also just the comment and one of the areas that of course reduces, the reported margin is the amortization of intangibles and that continues until some of these acquisitions are worked out that continues to be a fairly significant number. If you look at our EBITDA margin and Carlos can comment on what that is, I think our EBITDA margin is quite good.

It is, I think we run in the FSG around 21% and ETG 29% to 30% on EBITDA margin so those are strong, so that rising for the Company and both segments are very strong.

Right so when takeoff these if you will those incremental sales that’s what drive towards the lower margins for the period.

Got it and then maybe just go back Eric to Tyler’s line of question and as maybe airlines keep some of the older planes in demand, can you comment on what you’re seeing in surplus parts market out there? I would think that market would potentially soften up and how you guys are just viewing the trends there and contemplating that and it might be hard to tell. I mean you guys said it was very hard to tell what the airline behavior is, but maybe just kind of current activity in the surplus parts market?

Yes from what we’ve seen and of course we participate in relatively small way in the surplus parts market, but 2014 was much tougher than 2015 and that in order to be able to buy some of the assets. It looks the market definitely tightened up in 2014. I would assume with fuel prices lower they’re going to make sure that they get as much life out of the order equipment as possible, so that probably will make the surplus market a little bit tighter than it’s been in the past but we’re really going to have seen what that comes out to be. There is no question about fuel prices can’t be good for the surplus market.

Right, right.

By the way I’ll also add and one of the lines they gave in we’re really trying to get our arms around this. Nobody is anticipating significant cancellation on the equipment but of course if and this is only speculation if OEMs come under pressure little bit of pressure on new equipment where they’ve already committed to certain cost, they of course need to be to make up that shortfall elsewhere. And obviously the level that the OEMs always have is spare part pricing.

Right.

So, it could be very interesting if lower oil prices cause some if you incremental deferrals or cancellations and that in fact drive some higher OEMs spare parts pricing and of course would be very good for HEICO, would not be so good for the airlines but the airlines are used to this.

Got it and maybe just a last one I forgot for Victor, I mean, all of the challenges behind Lucix at this point, are you guys comfortable with this business going forward and maybe just a general update I know they have had some challenges and new start and rework on those satellite programs. Is this all they the rear view mirror.

I think it’s definitely much better than it was and you may recall on the last call I said I thought that we would work through these and see improvement as fiscal 14 in fact we’re on that it won’t be sort of totally clear selling. I don’t think we’re at a totally clear selling but it is much improved. They did get some pretty big orders towards the end of last year and that’s helped them out in the backlog. And on the technical side, I think they’re doing much better. Again, unfortunately not totally out of the woods yet but I think nice improvement.

And all of these are now reversals done for you guys I mean you did the impairment charge so should we expect any more noise to flow through the P&L?

I’ll let Carlos to answer that.

Yes. Michael all the impairment charges I guess all the contingent earn outs reversals relative to the 2013 acquisition the first when we’ve taken we have the small amount left on the books for a ‘13 acquisition but that’s around $1 million we’ll see how that plays out.

Our next question comes from the line of Steve Levenson with Stifel.

I appreciate the discussion you did on oil prices in airplane retirements I know there are other factors like environmental or metal fatigue or increasing MRO expense what are the things do you think go into the decision and is there particular I mean it is based on the edge of the number, cycles of the number of hours I know it’s complicated exercise to figure that out but we’ve been getting lot of questions and I thought you may help us out. Thanks.

Stephen, that’s a very good question. We believe that the existing fleet that’s out there does not have a problem with edge. The airplanes typically schedule retirement to the aircraft that they take the aircraft that are do for heavy maintenance or large expenditures and those are the ones they get retired first unless there are return requirements and they go back to the lessors. But basically if you see that the value the older equipment has come down so much. Newer equipment is still fairly expensive but with interest rates lower that was stimulating the purchase of newer equipment which in fact does have lower emissions and there is certain maintenance honeymoon with the newer equipment. However, with the older equipment there is basically no incremental depreciation that fully depreciated, interest rates for the short term are very low so whether we have new equipment or older equipment it remains low to the extent that airlines interest rates are going to take up that could impact the commitment to buy new equipment. Yes, there are the emissions issues but basically the equipment that’s find today there are no, I mean to my knowledge there is no major driver in terms of noise or a pollution that causing the retirement of these aircraft. It was just strictly an economic issue where by the newer equipment is a little bit more fuel efficient that they were able to save the lot of money on expensive fuel and they were able to get a bit of the maintenance holiday. But clearly airlines such as delta that has employed a strategy to use sort of mid-generation equipment, I think that’s going to turn out to be a very wise approach. They are not going to end up having the depreciation on the equipment that certain other carriers will have. So, again it’s a very complex equation. We think that it can only be good for us. The OEMs need to be careful to not, if you will, kill the goose that lays the golden egg by jacking up spare prices so much that they’re able to export back all the benefit from fuel in spare parts prices I think they’re too smart to do that. But there is probably some opportunity that they’ve got to try to recapture some margin here. So we’re just going to see how it placed out.

Okay, thanks. Second part of that question is we’ve done little calculation of our own and I’m trying to do a sanity test here, it looks like maybe 40% of the narrow body fleet has not yet come in for its first nature overhaul, do you think that’s a reasonable number or do think were too low, too high?

That’s a very good question. We don’t do our own independent analysis on that. I’ve read numbers all over the place I mean that 40% is in general consistent with a lot of the stuff that I have seen, of course that percentage may go down if older equipment stays out longer. So I think it’s very hard to figure out the way that we operate is we need to budget by business unit by customer by product type. So they are very much if you are a fairly conservative bottoms up analysis and we really don’t do broader general macro kind of things because the kind of projections because they become very theoretical and we’ve got our very specific drivers that the business has and that were folks are looking to achieve and when it starts getting if you were very theoretical it is a little too much gap between that and what really happens. So we’ll go after the airline we’ll understand specifically what specific airline intends on doing and that’s what drives our number. So, unfortunately I can’t really I wish I could help you out on that but the truth is I really don’t know but the 40% sounds like it’s in the general ballpark maybe it’s 30, maybe it’s 45 I don’t know but it’s in that general area.

Our next question comes from the line of Ken Herbert of Canaccord Genuity.

Good morning guys, it’s actually John tune in for Ken.

Okay, good morning.

Just to switch gears, you guys mentioned that a few small acquisitions were closing in the short term, how do you see opportunities in the long term and is an accelerated buyback on the table?

This is Eric, as far as the acquisitions I mean the one thing that we continue to see in the market is that HEICO is the preferred acquirer, we pay fair prices but most importantly we treat the employees that we refer to as team members, we treat the team members very well and we treat the customers very well and when the company comes in to the HEICO family we’re really looking to continue that entrepreneurial spirit and make sure that those processes and that feeling that help to drive the company, help to get it successful remains and we’ve got a long culture of doing this, we bought roughly 50 companies, roughly I don’t know 35 of them are still separate standalone businesses according to the original game plan and we’ve got an incredible roaster of set of former sellers who have worked with us and who know firsthand that this is not a line of craft but it’s for real. Now having said that with interest rates very low and private equity folks trying to put the money out because the only way they can get the upside and generate the fees is to get the money out sometimes they have been paying what we think are very high prices and that in our opinion is not going to work out well to the team members, to the employees of those businesses nor to the customers. We are, we definitely have become a bit more aggressive pricing wise and we have too in the past because of this phenomenon but we’re not going to step over the edge and so the trick for HEICO is to find people who want to join the family, who appreciate those intangibles that frankly they can’t find elsewhere. So, we’ve got a number of deals teed up right now. You never know is they’re going to close, there is also its issues going on and business is going up and businesses going down and hanging all of that but I would say that we’re cautiously optimistic, we work very very hard and we hope that they’re going to be some good announcements coming in the not too distinct future but again I don’t want to overpromise because it’s binary, either happens or does, you can’t say when we got to almost to the finish line and it been worked but I’m cautiously optimistic and I can tell you right now our deal book is much bigger than our capacity to process everything right now.

Okay, and then is there an accelerated buyback on the table at all?

Accelerated buyback, are you talking about stock buyback?

Yes, yes.

No, no and just to explain that further, we want to grow HEICO and buybacks shrink the company. So we feel that we would rather spend hundreds of thousands of millions expanding buying additional company, having cash flow and growth than shrinking the company. So, we’re not in the shrink mode.

Got it, and then just to bounce back quickly back to commercial aftermarket, are you seeing any additional pricing pressure from airlines and do you see that evolving at all?

No, actually we don’t I mean look airlines are always very price conscious I mean you might think that even though we offer them terrific savings and everything that we do that they don’t push us on price note, they’ve got great purchasing people or well skilled in the art and so they’re always pushing price but I wouldn’t say that that’s a major focus at this point.

Our next question comes from the line of Sheila Kahyaoglu of Jefferies.

Thanks for taking my question. I guess just one quick one for Eric, what sort of flight hour growth are you embedding in your guidance for next year? And you’ve mentioned new products several times over the last few quarters. Can you give us an idea of where you’re spending your focus a bit more?

Hi Sheila. The flight hour growth for us is very hard to determine because again when we do our budgets we go out to the customer and we go buy customer and we go buy platform and try to figure out the quantity or units whether it’s engines or components or airplanes that they’re going to be overhaul and what hour content is going to be on it. So the stuff that I read in terms of flight hour growth I think is around 5%-6% area. But that really is coming I am sort of circling back and giving you back what you guys right and I think you guys are very knowledgeable about that particularly. But it sounds in general consistent with the kind of stuff that we’re seeing. In terms of new products we did very well this year we continue to develop similar number of both PMEs and DER fares that we had historically for the last five, six, seven years. They are very-very well received. The folks are doing a great job getting out there finding out what the customers want and supplying it to them. So the pipeline is very full for us at the moment.

Our next question comes from the line of Arnie Ursaner of CJS Securities.

Good morning. Many of the questions have been answered but want to try to drill down a little bit more. You mentioned the operating -- someone had asked I don’t know seven or eight questions ago about operating margin. I want to focus on that one more second last year’s operating margin was impacted negatively by a number of some unusual items or headwinds and yet your overall margin guidance for the upcoming year is essentially flat. Obviously the industrial products was a higher operating margin area and you mentioned why that won’t be there in ’15. But shouldn’t we have some other offsets and some operating leverage in the business that you should get you a much higher margin what other factors are holding it back that we should be thinking about?

Arnie this is Carlos Macau. I think that as I said earlier if our sales come out in the line of our guidance we believe that our operating margins will be consistent with prior year. We do anticipate that if our sales growth goes up to the higher end of our guidance that there will be some opportunities for some margin expansion. But I wouldn’t call it the margin play is that what you’re after. I would say that there would be some leverage we could get but I wouldn’t focus on it be in a large margin play. And as far as last year goes I don’t recall that being a whole lot of noise if you would in our operating margin.

And Arnie this is Eric on the specifically with respect to the industrial product we’ve got a great team focused on these industrial products we’re still very-very much committed to them. And we’re maintaining that infrastructure and therefore if you will that excess capacity at the moment which cost money because we need these people to be able to handle the business when we find other products to take its place. It’s not going, we’re not going to end up we don’t anticipate making the same particular product that we made where we finished the contract. But we think that there are a lot more opportunities and the last thing that we want to do is to shed capacity, shed people and not be able to respond immediately for this. We’re the number one supplier in that area the amount of time that it takes for us to take a concept into a finished part with full rate production, with all this automated equipment and highly skilled people that we’ve got is I think world class user rate probably the best in the world. And we would rather suffer through if you will lower incremental margins and have the ability to respond quickly to our customers so when they need the stuff we’ll be back up on line for them.

What percent of the segment sales are industrial products?

On a combined basis other industrial…

Well I think what we say is that commercial aerospace is a vast majority of the business and we don’t breakout between industrial and defense for competitive reason, but the commercial is probably in the roughly 80% area.

And previously earlier in the call you’ve mentioned a sort of normalized 17% to 19% operating margin in FSG, in the past your ETG operating margin has been higher, how should we think about that in 15 on -- how should we look at in 15?

Your question is with respect to ETG or with respect rate.

Yes, ETG operating margin.

I think we’re expecting comparable for 14. Arnie, this is Victor. I think 2014 yes.

Our next question comes from the line of Dan Whalen of Topeka Capital Markets.

Most of my questions have been addressed but given right your end, can you comment all further just in terms of how many new PMA certifications that were?

The PMA certification approximated prior years in the 400 area and the same with the DER approvals are in the similar areas as well so all together would be about 800.

Our next question comes from line of Michael Derchin of CRT Capital Group

Historically organic sales growth has accounted for about 70% of your sales and bolt-on acquisitions about 30%. I guess in the last year that reversed a bit more coming from acquisitions. I am wondering if looking longer term like over the next five years would like to 70% to 30% split be an appropriate way to look at where your sales are coming from.

Michael, this is Carlos Macau. Historically, our split has been more along the 60-40 line. If you go back a number of years and we would expect to follow that same pattern, now keep in mind 14 was as we’ve mentioned previously challenging because the seller expectations and multiples went through the roof and we're very disciplined in our acquisition strategy, so we didn't see a lot acquisition activity this year, but we do expect going forward that when you look at our split of growth that it would be the 60-40 or 50-50 type split between organic and acquisition growth.

Our next question comes from line of Jim Foung of Gabelli & Company

I just want to follow up on the acquisition questioning here. You mentioned as you’ve kind of teed up for number of acquisitions this year and I was just curious if they will unfold in 2015, how big could they be all together if you were successful in closing all these?

Jim this is Carlos Macau. We can’t predict the closure of the acquisitions. As Eric mentioned earlier, we have a full play I would say from my perspective as a CEO, my team has been deployed all over the place looking at deals doing due diligence but we’re in various stages of that process. As Larry mentioned earlier, we have one that we expect that will close in the near terms smaller deal but we’re very active in the space and depending the economics of transactions and how we’re able to close them who knows, so we will continue as part of our historical strategy of growth through acquisitions to implement that strategy, but at this point we can’t predicate what will close and what will not what percent of our growth next year will come from that.

Right, I understood the timing of that uncertain and some of these maybe not even to fruition, but I was just wondering if you could just kind of bracket or put a sense around how big this could be if it all happen?

Jim, this is Larry. It’s very hard to say because some transactions are in early stage. They could relatively larger. Some of them are that are close and this is all relative but we don’t to give a number because if one happens and the other doesn’t those numbers will switch around, that’s a bigger one happens it will be more than we tell you that this is smaller one, the world will be disappointed and the truth is we really don’t know as you know until it’s closed it’s still hanging fire and deals blow up in the last minute. So we rather say that we are looking at a number of transactions they would be accretive as usual but as to the size we really would -- we don’t know. And we can’t handicap what’s going to close and what won’t.

Okay, fair enough. And then on ETG sector interest in your outlook to defense business this year in 2015, are you pretty comfortable that you have a good position and might see stability in 2015 in your defense products.

By the way our defense business Jim is not do importantly and relative terms it’s off a little bit I’m still very proud actually how the companies have done and very cloud we own our defense businesses. I really don’t know where the defense budget is going to be, my best guess is that somewhere towards the end of calendar 2015 or into 2016 that we start to see defense trends more positive and that we don’t through the bulk of ‘15. That’s the assumption we built into our budgets most of our defense companies have built in a harder year in fiscal ‘15 and ‘14 and that’s good for us to do because when we do that we’re conservative on our spending and we run the business and if we got some good surprise there I know there are lot of people out there lately I’ve seen the number of analyst report saying that, they think the defense budget is going to start turning very soon and in fact see sings where there some plus ups, something that’s very positive. And if that happen that’s great, then we can added in later but I think you know as well enough that we’re going to put plan conservatively and hope for better we keep the businesses running as well as possible and of course longer term I think as we’re getting out the businesses are still very well placed and got really the business in there. So we’re very happy with it.

And that was our final question I’ll now turn the floor back over to management for any additional or closing remarks.

The only thing in closing remark is that we thank you all for your interest in HEICO. We remain available to you, any one of us for questions that you may have. You know way to reach us. And we wish you a very happy Christmas holiday and New Year and we look forward to speaking to you in the middle of February when we come out with our next first quarter ‘15 result. So have a good day and good season. Bye, bye.

Thank you. This concludes today’s call. You may now disconnect.