Good morning. My name is Rachel, and I will be your conference operator today. At this time, I would like to welcome everyone to the Second Quarter Earnings Results Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. 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 those 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 product specification costs and requirements, which could cause an increase to our costs to complete contracts; governmental and regulatory demands, export policies and restrictions, reductions in defense, space or homeland security spending by U.S. 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 and sales growth; product development difficulties, 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, defense, space, medical, telecommunications and electronics 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, filings on Form 10-K, Form 10-Q and Form 8-K. We undertake no obligation to publicly update or revise any…

Thank you. The Flight Support Group net sales increased 4% to a record $202.8 million and increased 2% to a record $384.8 million in the second quarter and first six months of fiscal 2015, respectively, up from $194.9 million and $376.5 million in the second quarter and first six months of fiscal 2014, respectively. The increase in the second quarter and first six months principally reflects net sales contributed by our fiscal 2015 acquisitions, partially offset by lower net sales of certain industrial products within our specialty products lines. Further, the net sales increase in the first six months of fiscal 2015 reflects additional net sales from new product offerings and favorable market conditions in our aftermarket replacement parts product lines. As a result of the aforementioned lower sales of certain industrial products, the Flight Support Group experienced a 3% and a 2% organic revenue decline in the second quarter and first six months of fiscal 2015, respectively. Excluding this net sales decrease, the Flight Support Group experienced organic growth of approximately 1% and 3% in the second quarter and first six months of fiscal 2015, respectively, following a particularly strong first half of fiscal 2014 when we had organic growth of over 17%. For the full year we are estimating FSG's organic growth, excluding industrial products, will be mid-to-upper single digits. As noted last quarter, the lower industrial products net sales is principally attributed to a reduction in product demand associated with a particular customer and the related completion of such customer orders in late fiscal 2014. The Flight Support Group's operating income increased 2% to a record $37.5 million in the second quarter of fiscal 2015, up from $36.9 million in the second quarter of fiscal 2014. The increase in operating income is principally attributed to the previously…

Thank you, Eric. The Electronic Technologies Group's net sales increased 1% to $91 million and 2% to a record $180.2 million in the second quarter and first six months of fiscal 2015, respectively, up from $89.7 million and $177.2 million in the second quarter and first six months of fiscal 2014, respectively. All of the increase was organic, principally resulting from higher demand for certain medical, defense and aerospace products. The Electronic Technologies Group's operating income increased 22% to $22.2 million in the second quarter of fiscal 2015, up from $18.1 million in the second quarter of fiscal 2014. The operating income increase principally reflects a more favorable product mix for certain space and defense products, a constant focus on efficiency, and lower amortization expense of intangibles. The Electronic Technologies Group's operating income increased 1% to a record $41.6 million in the first six months of fiscal 2015, up from $41 million in the first six months of fiscal 2014. This increase principally reflects a more favorable product mix for certain space and defense products and lower amortization expense of intangible assets, partially offset by an $8.1 million reduction in accrued contingent consideration recognized in the prior year. The Electronic Technologies Group's operating margin improved to 24.4% in the second quarter of fiscal 2015, up from 20.2% in the second quarter of fiscal 2014. The ETG's operating margin of 23.1% for the first six months of fiscal 2015 approximates 23.2% reported in the first six months of fiscal 2014. This increase in the second quarter of fiscal 2015 principally reflects the previously mentioned focus on efficiency, favorable product mix, and lower amortization expense of intangible assets. I'll turn the call back over to Larry Mendelson. Laurans A. Mendelson - Chairman & Chief Executive Officer: Our consolidated net income per diluted…

Your first question is from the line of Robert Kindler (30:40), Credit Suisse.

Good morning. Laurans A. Mendelson - Chairman & Chief Executive Officer: Good morning, Rob (30:43).

Larry that was just an outstanding level of detail. Thank you. And in trying to peel the onion, it looks like both net income and margins are tracking to the guidance in the first half. But the one thing that isn't is sales. And so, sales are going to improve in the second half, you talked about some tough comps. I was hoping perhaps you or Eric or Victor could talk a little bit more about the organic growth expected in the second half and to what extent, if any, some of this M&A you mentioned might be built into that forecast. Laurans A. Mendelson - Chairman & Chief Executive Officer: Okay. Eric is going to focus on that. He'll respond to it.

Hi, Rob. With regard to the level of sales, of course, within the Flight Support Group, we mentioned that we are anticipating mid to high single-digit sales increases – organic sales increases in the Flight Support Group for the second half of the year. If you recall, we had particularly tough comps for the last six months with organic sales up in the 2014 period, first half, up 17%. So, we've had tough comps. In addition, we had the completion of that industrial product contract. And as a result that brought us down. But we do anticipate an increase coming into the second half. Also to point out and to add a little bit of color, we do participate a little bit in the asset management business. And that business also was down a little bit in the first half of this year, in particular in the second quarter, primarily as a result of, in our opinion, asset prices being bid up to very aggressive levels where we've decided to sit out and rather than speculate and, if you will, take tight margins than have risk in inventory and receivables. We've decided to turn back our exposure there a little bit. So, that's brought it down a little bit. But we are doing quite nicely over on our parts, repair and distribution aftermarket businesses. I don't know if that answers your question...

And, Rob, this is Victor. On the ETG side, I think you see that we tend to be somewhat volatile quarter-to-quarter and we continue to expect low to mid single-digit organic growth out of the ETG on the full year.

So, the total growth when you look at it that way, Eric, the organic mid to high single, I think you said?

Correct.

And what are you looking for, for total growth?

And by the way let me point out that is excluding – as we mentioned in the press release and the conference call, that is excluding the industrial products. That would be just out of the commercial side.

Right. So, including everything to get to the 8% to 10% for the year for the guidance, what – how should we think about absolute sales growth – total sales growth in the second half here, I guess, in both businesses?

I'm going to let Carlos answer that. Carlos L. Macau - Chief Financial Officer, Treasurer & Executive VP: Rob, this is Carlos. The guidance that we give, the 8% to 10% sales growth is consolidated guidance and it includes the impact of the acquisitions that we've got to-date, plus we've got some bolt-on acquisitions that we're looking to close, in the process of completion that have factored into sort of probability weighted outlook on what the year will do. So, that's principally how we get to the 8% to 10% growth.

(34:55) Carlos L. Macau - Chief Financial Officer, Treasurer & Executive VP: It's not broken down by segment. Laurans A. Mendelson - Chairman & Chief Executive Officer: Rob, also, it doesn't include, because we don't know the potential acquisitions that I spoke to, and we can't, A, predict that they're going to close and, B, will they close in May, June, July, August and that would impact. And one of them – a couple of them are slightly larger than we normally do, so that's a question mark is up in the air.

Right. But that would be additive.

That would be additive.

So, Carlos, going back to your point, could you distinguish between the – what the growth would be with or without those bolt-ons? Carlos L. Macau - Chief Financial Officer, Treasurer & Executive VP: No. I think the way that we look at it is we give a range and the range of 8% to 10%. If we do nothing with the 8%, 10%, 8% range and if we add a product line of bolt-on, then we're in the middle to the high end of that and that's kind of how we look at it.

Okay. Okay. Thank you, all. Laurans A. Mendelson - Chairman & Chief Executive Officer: Thanks, Rob.

Your next question is from the line of Larry Solow, CJS Securities.

Hi. Good morning, guys. Laurans A. Mendelson - Chairman & Chief Executive Officer: Good morning, Larry.

Just to reaffirm on that. So essentially, if you don't do any more bolt-ons, which sound like there would be pretty small contributions anyhow, you're targeting sort of the lower end of the range. And the range essentially for the most part is the additional of bolt-ons or not. Fair to say? Carlos L. Macau - Chief Financial Officer, Treasurer & Executive VP: I think that's a fair way to look at it, Larry.

Okay. Great. And just I know you guys have been sort of, you in the last couple of calls were cautious pretty much in the first half of the year with the pickup in the back half. Seems like most of that is just a function of timing tough comps, would you characterize the spending and the environment – demand is pretty steady but good? I assume so, because it looks like your guidance sort of implies a little double-digit growth at least than FSG excluding the industrial piece?

Larry, this is Eric. With regards to the FSG, we are anticipating growth in revenue of the first and second quarter into the third and fourth quarters. So, it is partly as a result, as you point out easier comps, but there is also growth embedded in there as well.

And have you seen any impact anecdotally or as the year is progressing – and I realize oil has certainly stabilized and rebounded a little bit, but it seems like it's certainly well below prior levels. Have you seen less retirements or a little more hesitant in retiring aircraft?

What we've seen a little bit of it, I wouldn't say that it's been a significant impact. There are some cases that the aircraft that were planned to be taken out of service that didn't have time left on them, so they did have to overhaul the components of the engine. So, we have seen a little bit of that. But if you recall, we've always been very conservative on this point. And we're traditionally conservative on our guidance because we receive most of our orders in the month they're shipped.

Right.

So we clearly don't have that kind of visibility into the future like some other companies may have. So, that's why we've been conservative. We see a little bit, but we're not anticipating a big resurgence. That could happen and there had been some airlines that have expressed an interest in picking up on that market. But until we see it translate into part sales, we think it's too early to call.

Got it. Just in the specialty industrial product side, I realize there was this one large contract that expired. You guy had spoken over the last couple of quarters about some other deals you're working on that had some projects that shifted a little bit to the right. Any update on those and do you see some signs of a rebound as we look out?

Yes. We're very encouraged in those areas. I just did a review with that business and those programs are on the revised track. We do have the business. It's just a matter of when the manufacturers need our products because our products, typically, goes on the end of the production line. So, we're sort of one of the last things that goes in there. But we're in – I think very good shape with respect to both aerospace, as well as some additional industrial products. So, I'm pretty optimistic in that area.

Got it. Great. Thank you very much.

Thanks.

Your next question is from the line of Michael Ciarmoli, KeyBanc Capital Markets.

Hi. Good morning, guys. It's actually Kevin on for Mike. Laurans A. Mendelson - Chairman & Chief Executive Officer: Good morning.

If I understood correctly, it seems like the outlook for revenue growth in ETG improved a little bit. I think last quarter you said you were looking for revenue and EPS growth to kind of be in line with fiscal 2014. Now, it sounds like you're expecting improved organic revenue growth there. Is that the right way to look at it and any color you can give on kind of what drove that improvement?

Sure. This is Victor. I think it was pretty broad. The improvement has been pretty broad for us across most of the product lines and segments that we serve in the ETG. Defense has been decent, actually growing a little bit. This continued in the second quarter. We talked about a little bit in the call on the first quarter. Space has been good for us. Commercial aviation has been good for us. Medical has been good for us. What's been a little weaker is where we serve other markets, which we just sort of lump together, we call it general commercial or general electric or general industrial markets. And so everything's kind of holding in right now, I think, pretty nicely. We've talked about in the past the outlook for defense. I'll answer this sort of prophylactically because I know somebody will ask it, and that is that defense has been stronger. We've talked about in the past, I think in the fourth quarter call, sort of saying that we would expect maybe toward the end of 2015 or sometime in early 2016 to see some improvement. It's happening faster than that. We tend to be cautious in the statements that we make. But, of course, I will point out that we still don't know where domestic defense budgets will wind up ultimately. So we're being pretty careful on how we view those, both by the way, in the way we operate the businesses and the acquisitions that we look at. So we are interested in defense acquisitions, and we're looking at some now, but we are highly selective as to what we'll go after.

Great. Thanks. Thanks for that color, Victor. Any update you can give us on what you're seeing on the component repair side in the quarter? I know with some of your competitors, we saw some timing issues and softness during the quarter. Just wondering what you guys are seeing in that business.

I think we're doing very well. We continue to take market share. I'm very, very pleased with our team and this business that they've been able to develop and grow the new products they're coming out with. So I feel very good in that area.

Okay. Thanks. And then last one for me and I'll jump back in queue. How are you guys positioning yourselves here and, I guess, the product portfolio with the first 787s starting to come off warranty? I mean, how does that ramp work on your end and where are you in that process?

Yeah. That comes a bit further down the road for us. We need to have a larger fleet out there. Right now, they're working on a lot of the operational issues, the seating issues with those aircrafts. And the opportunity for us would come down the road.

Okay.

We don't have, on the replacement part side, any significant 787 volume. Maybe a little bit on the distribution side, some perhaps specialty – definitely specialty manufacturing would have some exposure there, but not in terms of aftermarket replacement parts or repair services at this time.

Okay. Thanks.

Thanks.

Thank you.

Your next question is from the line of Jonathan Morales, Canaccord Genuity.

Hey. Good morning, everyone. Thanks for taking my question. So, Eric, this question is for you. So, are there any unique trends, I guess, you're seeing in commercial aftermarket either by region or airline type that you can comment on?

No. I wouldn't say anything really in particular. There continues to be a tremendous amount of interest in the products and the repairs that we're coming out with. I think we're doing very well. We're executing very well. But I wouldn't say that there's anything significantly different from what we've discussed. I just did a review with all of our – the heads of our different sales regions and I think we're operating very well. I'm quite pleased with how we're doing.

Got you. Thank you. And then, Victor, what's your outlook for defense spending? And, I guess, are you seeing any uptick, in particular, in demand for electronics, I guess, as part of sort of an upgrade cycle?

I think we've seen some improved demand from where it had been. Some of it is probably upgrade-related or some of it definitely is upgrade-related. At this point, honestly, I know as much about the defense budget and where it's going really as anyone else. I think that although the headline defense budget is being kept in check, we've all seen what's going on on the supplemental side.

Right.

And so it just seems to me as though there's a lot of inertia to plussing up the defense budget either directly or indirectly, and that that should happen and it should benefit us somewhere along the line. I still prefer to be out there telling people think about it in terms of 2016. And if it happens sooner – and I know it has been happening sooner – but if it happen sooner, great.

Right.

But don't count on it until then; I think that's a safer bet.

Okay. Thanks, Victor. And that's all I had. Thank you, guys.

Thank you.

Your next question is from the line of Howard Rubel, Jefferies.

Thank you very much. Larry, maybe for a moment, you might want to talk about what's changed so that all of a sudden you're looking at bigger deals. Is it the sellers? Is it you've expanded your scope? If you could characterize the environment a bit. Laurans A. Mendelson - Chairman & Chief Executive Officer: Yeah. I think that we're an opportunistic buyer, and some of the – as you know, the very large deals, normally, at much higher PE ratio, some of them go at 14 and we bow out. We're not in the market for those kind of pricing. Some of the deals that we're seeing, they're not huge deals, but I would say they're on the slight – couple of them are on the slightly larger size than we normally do. They're not gigantic deals, but they're wonderful companies. And if we could disclose at this point, we can't, but if we could, I think everybody would agree that these are wonderful opportunities. Now, we have to get into the due diligence and so forth and see if we can make them. But it's just that they became available, they were the right kind of sellers for a HEICO acquisition and it just kind of worked out. In the mix there, there are a few smaller ones, too, which are our normal bite-sized transactions. Carlos mentioned the bolt-on things and they're small, but some of them are larger, but wonderful, wonderful companies. And it's just the way it falls out. Just the way it falls out.

No. That's fine. Laurans A. Mendelson - Chairman & Chief Executive Officer: We have – as you know, we have the firepower to buy much, much larger companies. I mean, we have this $800 million revolver unsecured. The banks want to bring it to $1 billion. At the moment, we can accomplish our growth objectives without going to $1 billion. But in addition to that, we have really – I don't want to say unlimited, but unlimited in terms of how much we need to meet growth objective. We targeted 20% growth over the next three to five years bottom line, and we easily have the financial capability to do that without stretching and without putting the company's neck on the line. But it's really we are opportunistic buyers and we buy good properties at good prices. They're accretive and they cash flow. And that's really our formula.

It just sounds like these are more mature prospects than you've seen in a while. Laurans A. Mendelson - Chairman & Chief Executive Officer: Not necessarily. I think that – again, it's a broad mix and they're all wonderful companies. Some of them – they cover the waterfront. They really do and we're very – again, we are very discerning, very selective. And all of these, as companies, operating entities are ideal for HEICO to acquire. Now, it's up to us to do the due diligence and make sure – unfortunately, we have found, and you probably know this from your own experience, that sometimes sellers or their investment banker representatives become a little overly optimistic, and they try to sell, call it what it is, a pig in a poke. And they try to tell you that if this much this year but next year, wow, we're going to double, and we have to go in there and really do a thorough due diligence which is very time consuming, because, unfortunately, we can't take them at their word. We're not buying public companies where we have SEC-filed statements and so forth. So, these are basically private companies, and we just have to be very, very careful. And that's why it takes so long.

Howard, this is Victor. Also, I should point out that over the years, we bought companies with different growth rates, some on the fairly low side but very strong and stable, and others that are faster growth. So, what we're looking at is within our typical mix in that regard. Laurans A. Mendelson - Chairman & Chief Executive Officer: Howard, the key – the bottom line key to this is number one, strong cash flow return for what we invest. You know that we look for 20% operating margin which, quick and dirty, gives us a – it's very good...

Very nicely accretive. Laurans A. Mendelson - Chairman & Chief Executive Officer: It's accretive. But not only accretive in earnings, because I can do that easy, I can go out and buy things that have big CapEx and working capital requirements and then go to the bank, or go to the investment bankers and raise equity to pay for. Anybody can do that and some companies do to raise the top line and show, oh, we're growing the top line. We don't do that. We want to – since we're the larger shareholders, it's our money at stake and every investor in HEICO is our partner. So if we guess right and we make our money work for us, we're making our money work for every single investor. That's our philosophy. That's the basic philosophy. And if we see a great company and it's 20% or 25% return on investment, hey, we're going to buy that company because that's a wonderful return. And if it doesn't grow that much, okay, it doesn't grow that much. But that's a wonderful return and we take that money and put it towards acquisitions of faster growing ones, as Victor says. So it's kind of a mix.

I appreciate that. And I just have one question and another context and then I'm done. And if we look at flight hour growth for airlines, it looks like it's 5%, 6% globally. And if we look at sort of what you're thinking about the second half for FSG, it's kind of in that same range organically. What's happening with pricing or mix so that we're not seeing something a little bit more robust than that?

I think – well, of course, some of the flight hour growth is newer aircraft that are being delivered and those aren't acquiring yet at fares. So, I think that is part of it. And I think we're just typically fairly conservative in our estimates.

Thank you, gentlemen.

Thank you, Howard.

Your next question is from the line of Steve Levenson with Stifel. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Thanks. Good morning, everybody. Laurans A. Mendelson - Chairman & Chief Executive Officer: Good morning, Steve. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Just curious on the development spending, your planning. Is it more focused on parts or on service processes? And is it on a particular platform or is it spread out over a number of platforms?

Steve, this is Eric. With regard to the Flight Support Group, I'd say that it's spread out. It's been both parts that's in services and it is spread out. I mean, it typically is on the more numerous platforms that are out there. But it is very well diversified.

Steve... Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Okay, thanks. Sorry, go ahead.

This is Victor. I was going to add essentially the same thing on the ETG. I think throughout HEICO that would be appropriate. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Okay. In terms of platforms that are out there, there are a certain number of them, for example 757s, that seemed to be coming out of service. I think it's a pretty popular plane, but it's probably one of the ones in your sweet spot. So, is that going to have an impact or any of the other parts you have will be coming obsolete due to retirement of the aircrafts or more commodity like?

No. I would say it really is across the board where the new product development is really a focus everywhere. We tend not to focus on the older aircrafts. And we tend to focus on the aircrafts where there's a lot in – a lot flying right now. I don't know if that answers your question. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Yeah, I think so. Just wondered because some of the ones that are the oldest planes are the ones you think might be coming out. I hope you're not likely focusing new product development there. But I just wonder if you're going to be left with something if that has somehow affected organic growth?

No, I mean, our estimates include retirement of the older aircraft, I mean, in particular, the 757 is, I expect it to come out of the fleet over the next number of years, so our estimates have that embodied in there already. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc.: Got it. Good to know. Thank you.

Thank you. Laurans A. Mendelson - Chairman & Chief Executive Officer: Thank you.

We have no other questions. Are there any closing remarks? Laurans A. Mendelson - Chairman & Chief Executive Officer: The only closing remarks, again, we look forward to speaking to you in about three months on the third quarter telethon. And we thank everyone for their interest in HEICO. We remain as a management, top management available for phone calls, visits if you'd like to have any questions answered. If you want to visit the facilities, you're welcome, make an appointment with us, and we thank you for your interest in HEICO and your support. So, that is the extent of my remarks.

This concludes today's teleconference. You may now disconnect.