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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, 2021
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 26, 2021 is as follows:
Common Stock, $.01 par value
54,225,252 shares
Class A Common Stock, $.01 par value
81,130,599 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 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, 2021October 31, 2020
ASSETS
Current assets:
Cash and cash equivalents$385,444 $406,852 
Accounts receivable, net215,736 210,433 
Contract assets59,881 60,429 
Inventories, net462,586 463,205 
Prepaid expenses and other current assets39,774 24,706 
Total current assets1,163,421 1,165,625 
Property, plant and equipment, net177,315 168,848 
Goodwill1,400,048 1,383,167 
Intangible assets, net557,550 579,041 
Other assets296,834 251,030 
Total assets$3,595,168 $3,547,711 
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt$1,111 $1,045 
Trade accounts payable87,467 76,237 
Accrued expenses and other current liabilities167,563 162,232 
Income taxes payable617 1,647 
Total current liabilities256,758 241,161 
Long-term debt, net of current maturities583,352 738,786 
Deferred income taxes47,409 55,658 
Other long-term liabilities324,493 280,291 
Total liabilities1,212,012 1,315,896 
Commitments and contingencies (Note 11)
Redeemable noncontrolling interests (Note 3)223,266 221,208 
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; 54,225 and 54,195 shares issued and outstanding
542 542 
Class A Common Stock, $.01 par value per share; 150,000 shares authorized; 81,126 and 80,923 shares issued and outstanding
811 809 
Capital in excess of par value311,995 299,930 
Deferred compensation obligation4,777 4,886 
HEICO stock held by irrevocable trust(4,777)(4,886)
Accumulated other comprehensive income (loss)1,674 (9,149)
Retained earnings1,812,798 1,688,045 
Total HEICO shareholders’ equity2,127,820 1,980,177 
Noncontrolling interests32,070 30,430 
Total shareholders’ equity2,159,890 2,010,607 
Total liabilities and equity$3,595,168 $3,547,711 
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 OPERATIONS – UNAUDITED
(in thousands, except per share data)
Six months ended April 30,Three months ended April 30,
2021202020212020
Net sales$884,553 $974,421 $466,651 $468,146 
Operating costs and expenses:
Cost of sales546,346 597,484 286,878 289,256 
Selling, general and administrative expenses161,174 157,786 83,025 70,729 
Total operating costs and expenses707,520 755,270 369,903 359,985 
Operating income
177,033 219,151 96,748 108,161 
Interest expense(4,531)(8,042)(2,083)(3,759)
Other income 1,017 302 306 107 
Income before income taxes and noncontrolling interests
173,519 211,411 94,971 104,509 
Income tax expense20,800 700 18,500 23,600 
Net income from consolidated operations152,719 210,711 76,471 80,909 
Less: Net income attributable to noncontrolling interests
11,450 13,370 5,798 5,456 
Net income attributable to HEICO$141,269 $197,341 $70,673 $75,453 
Net income per share attributable to HEICO shareholders:
Basic$1.04 $1.47 $.52 $.56 
Diluted$1.03 $1.44 $.51 $.55 
Weighted average number of common shares outstanding:
Basic135,252 134,596 135,294 134,669 
Diluted137,778 137,269 137,814 137,117 

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
COMPREHENSIVE INCOME – UNAUDITED
(in thousands)
Six months ended April 30,Three months ended April 30,
2021202020212020
Net income from consolidated operations$152,719 $210,711 $76,471 $80,909 
Other comprehensive income (loss):
Foreign currency translation adjustments11,109 (7,399)(539)(4,721)
Amortization of unrealized loss on defined benefit pension plan, net of tax
68 39 34 15 
Total other comprehensive income (loss)11,177 (7,360)(505)(4,706)
Comprehensive income from consolidated operations
163,896 203,351 75,966 76,203 
Net income attributable to noncontrolling interests
11,450 13,370 5,798 5,456 
Foreign currency translation adjustments attributable to noncontrolling interests
354 (295)(50)(165)
Comprehensive income attributable to noncontrolling interests
11,804 13,075 5,748 5,291 
Comprehensive income attributable to HEICO$152,092 $190,276 $70,218 $70,912 

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 Six Months Ended April 30, 2021 and 2020
(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 Income (Loss)Retained EarningsNoncontrolling InterestsTotal Shareholders' Equity
Balances as of October 31, 2020$221,208 $542 $809 $299,930 $4,886 ($4,886)($9,149)$1,688,045 $30,430 $2,010,607 
Comprehensive income
9,061 — — — — — 10,823 141,269 2,743 154,835 
Cash dividends ($.08 per share)
— — — — — — — (10,818)— (10,818)
Issuance of common stock to HEICO Savings and Investment Plan
— — — 7,440 — — — — — 7,440 
Share-based compensation expense
— — — 4,271 — — — — — 4,271 
Proceeds from stock option exercises
— — 2 3,836 — — — — — 3,838 
Redemptions of common stock related to stock option exercises
— — — (3,624)— — — — — (3,624)
Distributions to noncontrolling interests
(12,720)— — — — — — — (1,103)(1,103)
Adjustments to redemption amount of redeemable noncontrolling interests
5,698 — — — — — — (5,698)— (5,698)
Deferred compensation obligation— — — — (109)109 — — — — 
Other
19 — — 142 — — — — — 142 
Balances as of April 30, 2021$223,266 $542 $811 $311,995 $4,777 ($4,777)$1,674 $1,812,798 $32,070 $2,159,890 

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, 2019$188,264 $541 $804 $284,609 $4,232 ($4,232)($16,739)$1,397,327 $28,118 $1,694,660 
Comprehensive income
9,422 — — — — — (7,065)197,341 3,653 193,929 
Cash dividends ($.08 per share)
— — — — — — — (10,762)— (10,762)
Issuance of common stock to HEICO Savings and Investment Plan
— — — 7,281 — — — — — 7,281 
Share-based compensation expense
— — — 5,275 — — — — — 5,275 
Proceeds from stock option exercises
— — 2 2,390 — — — — — 2,392 
Redemptions of common stock related to stock option exercises
— — — (2,567)— — — — — (2,567)
Noncontrolling interests assumed related to acquisitions7,538 — — — — — — — — — 
Distributions to noncontrolling interests
(8,977)— — — — — — — (765)(765)
Adjustments to redemption amount of redeemable noncontrolling interests
260 — — — — — — (260)— (260)
Other
— 1 — 336 — — — — — 337 
Balances as of April 30, 2020$196,507 $542 $806 $297,324 $4,232 ($4,232)($23,804)$1,583,646 $31,006 $1,889,520 

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, 2021 and 2020
(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 Income (Loss)Retained EarningsNoncontrolling InterestsTotal Shareholders' Equity
Balances as of January 31, 2021$222,225 $542 $811 $301,107 $4,777 ($4,777)$2,129 $1,744,247 $31,323 $2,080,159 
Comprehensive income
4,264 — — — — — (455)70,673 1,484 71,702 
Issuance of common stock to HEICO Savings and Investment Plan
— — — 7,440 — — — — — 7,440 
Share-based compensation expense
— — — 2,042 — — — — — 2,042 
Proceeds from stock option exercises
— — — 1,388 — — — — — 1,388 
Redemptions of common stock related to stock option exercises
— — — (53)— — — — — (53)
Distributions to noncontrolling interests
(5,342)— — — — — — — (737)(737)
Adjustments to redemption amount of redeemable noncontrolling interests
2,122 — — — — — — (2,122)— (2,122)
Other
(3)— — 71 — — — — — 71 
Balances as of April 30, 2021$223,266 $542 $811 $311,995 $4,777 ($4,777)$1,674 $1,812,798 $32,070 $2,159,890 


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, 2020
$195,893 $541 $805 $287,779 $4,232 ($4,232)($19,263)$1,508,784 $30,601 $1,809,247 
Comprehensive income
4,655 — — — — — (4,541)75,453 636 71,548 
Issuance of common stock to HEICO Savings and Investment Plan
— — — 5,983 — — — — — 5,983 
Share-based compensation expense
— — — 2,629 — — — — — 2,629 
Proceeds from stock option exercises
— — 1 863 — — — — — 864 
Redemptions of common stock related to stock option exercises
— — — (5)— — — — — (5)
Noncontrolling interests assumed related to acquisitions
(2)— — — — — — — — — 
Distributions to noncontrolling interests
(4,630)— — — — — — — (231)(231)
Adjustments to redemption amount of redeemable noncontrolling interests
591 — — — — — — (591)— (591)
Other
— 1 — 75 — — — — — 76 
Balances as of April 30, 2020
$196,507 $542 $806 $297,324 $4,232 ($4,232)($23,804)$1,583,646 $31,006 $1,889,520 


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,
20212020
Operating Activities:
Net income from consolidated operations$152,719 $210,711 
Adjustments to reconcile net income from consolidated operations to net cash provided by operating activities:
Depreciation and amortization45,919 43,276 
Share-based compensation expense4,271 5,275 
Employer contributions to HEICO Savings and Investment Plan5,046 4,811 
Deferred income tax benefit (8,487)(5,137)
Increase in accrued contingent consideration659 1,167 
Changes in operating assets and liabilities, net of acquisitions:
(Increase) decrease in accounts receivable(3,795)44,419 
Decrease (increase) in contract assets 596 (12,985)
Decrease (increase) in inventories2,932 (37,790)
Increase in prepaid expenses and other current assets(12,032)(15,603)
Increase in trade accounts payable10,843 2,627 
Increase (decrease) in accrued expenses and other current liabilities1,981 (47,673)
Decrease in income taxes payable(4,076)(2,018)
Net changes in other long-term liabilities and assets related to
   HEICO Leadership Compensation Plan
11,826 13,951 
Other1,710 851 
Net cash provided by operating activities210,112 205,882 
Investing Activities:
Acquisitions, net of cash acquired(20,226)(45,343)
Capital expenditures(21,938)(12,435)
Investments related to HEICO Leadership Compensation Plan (10,900)(13,600)
Other1,017 473 
Net cash used in investing activities(52,047)(70,905)
Financing Activities:
Payments on revolving credit facility(155,000)(68,000)
Borrowings on revolving credit facility 245,000 
Distributions to noncontrolling interests(13,823)(9,742)
Cash dividends paid(10,818)(10,762)
Redemptions of common stock related to stock option exercises(3,624)(2,567)
Revolving credit facility issuance costs(1,468) 
Proceeds from stock option exercises3,838 2,392 
Other(522)(769)
Net cash (used in) provided by financing activities(181,417)155,552 
Effect of exchange rate changes on cash1,944 (744)
Net (decrease) increase in cash and cash equivalents(21,408)289,785 
Cash and cash equivalents at beginning of year406,852 57,001 
Cash and cash equivalents at end of period$385,444 $346,786 
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, 2020. The October 31, 2020 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, 2021 are not necessarily indicative of the results which may be expected for the entire fiscal year.

Certain immaterial prior year amounts within the Condensed Consolidated Statements of Cash Flows have been reclassified to conform to the current year presentation and resulted in no changes to total Net cash provided by operating activities, Net cash used in investing activities and Net cash (used in) provided by financing activities.

The Company has two operating segments: the Flight Support Group (“FSG”), consisting of HEICO Aerospace Holdings Corp. and HEICO Flight Support Corp. and their respective subsidiaries; and the Electronic Technologies Group (“ETG”), consisting of HEICO Electronic Technologies Corp. (“HEICO Electronic”) and its subsidiaries.

The Company's results of operations in the first six months and second quarter of fiscal 2021 continue to reflect the adverse impact from the COVID-19 global pandemic (the “Pandemic”). Most notably, demand for HEICO's commercial aviation products and services continues to be moderated by the ongoing depressed commercial aerospace market. Consolidated net sales for the Company's businesses that operate within the commercial aerospace industry decreased by approximately 30% and 14% in the first six months and second quarter of fiscal 2021, respectively, as compared to the first six months and second quarter of fiscal 2020. As we look ahead to the remainder of fiscal 2021, the Company is cautiously optimistic that the ongoing worldwide rollout of COVID-19 vaccines will have a positive influence on commercial air travel and generate favorable economic environments in the markets it serves. However, the pace of recovery in global travel remains difficult to predict and can be


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negatively influenced by new COVID-19 variants and varying vaccine adoption rates. However, the Company believes its ongoing fiscal conservative policies, strong balance sheet, and high degree of liquidity enable it to invest in new research and development, execute on its successful acquisition program, and position HEICO for market share gains as the industry recovers.

New Accounting Pronouncements

    In January 2017, the Financial Accounting Standards Board issued Accounting Standards Update "ASU" 2017-04, "Simplifying the Test for Goodwill Impairment," which is intended to simplify the current test for goodwill impairment by eliminating the second step in which the implied value of a reporting unit is calculated when the carrying value of the reporting unit exceeds its fair value. Under ASU 2017-04, goodwill impairment should be recognized for the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The Company adopted ASU 2017-04 in the first quarter of fiscal 2021 and will apply the guidance on a prospective basis when assessing its goodwill for impairment.


2.     ACQUISITION

In March 2021, the Company, through HEICO Electronic, acquired all of the business, assets and certain liabilities of Pyramid Semiconductor LLC ("Pyramid"). Pyramid is a specialty semiconductor designer and manufacturer offering a well-developed line of processors, static random-access memory (SRAM), electronically erasable programmable read-only memory (EEPROM) and Logic products on a diverse array of military, space and medical platforms.

    The purchase price of Pyramid was paid in cash using cash provided by operating activities, and is not material or significant to the Company's condensed consolidated financial statements. The allocation of the total consideration for Pyramid to the tangible and identifiable intangible assets acquired and liabilities assumed is preliminary until the Company obtains final information regarding their fair values. However, the Company does not expect any adjustment to such allocations to be material to the Company's consolidated financial statements. The operating results of Pyramid were included in the Company’s results of operations from the effective acquisition date. The amount of net sales and earnings of Pyramid included in the Condensed Consolidated Statements of Operations for the six and three months ended April 30, 2021 is not material. Had the Pyramid acquisition occurred as of November 1, 2019, net sales, net income from consolidated operations, net income attributable to HEICO, and basic and diluted net income per share attributable to HEICO shareholders on a pro forma basis for the six and three months ended April 30, 2021 and 2020 would not have been materially different than the reported amounts.




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3.     SELECTED FINANCIAL STATEMENT INFORMATION

Accounts Receivable
(in thousands)April 30, 2021October 31, 2020
Accounts receivable$227,613 $223,171 
Less: Allowance for doubtful accounts(11,877)(12,738)
Accounts receivable, net$215,736 $210,433 

Inventories
(in thousands)April 30, 2021October 31, 2020
Finished products$227,956 $235,501 
Work in process41,393 37,957 
Materials, parts, assemblies and supplies193,237 189,747 
Inventories, net of valuation reserves$462,586 $463,205 

Property, Plant and Equipment
(in thousands)April 30, 2021October 31, 2020
Land$10,969 $6,678 
Buildings and improvements130,901 120,769 
Machinery, equipment and tooling274,521 265,408 
Construction in progress7,846 8,487 
424,237 401,342 
Less: Accumulated depreciation and amortization(246,922)(232,494)
Property, plant and equipment, net$177,315 $168,848 

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 $15.3 million and $15.8 million as of April 30, 2021 and October 31, 2020, respectively. The total customer rebates and credits deducted within net sales for the six months ended April 30, 2021 and 2020 was $1.8 million and $3.8 million, respectively. The total customer rebates and credits deducted within net sales for the three months ended April 30, 2021 and 2020 was $1.0 million and $1.7 million, respectively.



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Research and Development Expenses

The amount of new product research and development ("R&D") expenses included in cost of sales for the six and three months ended April 30, 2021 and 2020 is as follows (in thousands):
Six months ended April 30,Three months ended April 30,
2021202020212020
R&D expenses$34,203 $33,855 $18,022 $16,752 

Redeemable Noncontrolling Interests

The holders of equity interests in certain of the Company's subsidiaries have rights ("Put Rights") that may be exercised on varying dates causing the Company to purchase their equity interests through fiscal 2030. The Put Rights, all of which relate either to common shares or membership interests in limited liability companies, provide that the cash consideration to be paid for their equity interests (the "Redemption Amount") be at fair value or a formula that management intended to reasonably approximate fair value based solely on a multiple of future earnings over a measurement period. Management's estimate of the aggregate Redemption Amount of all Put Rights that the Company could be required to pay is as follows (in thousands):
April 30, 2021October 31, 2020
Redeemable at fair value $181,918 $179,415 
Redeemable based on a multiple of future earnings41,348 41,793 
Redeemable noncontrolling interests$223,266 $221,208 
    
Accumulated Other Comprehensive Income (Loss)

Changes in the components of accumulated other comprehensive income (loss) for the six months ended April 30, 2021 are as follows (in thousands):
Foreign Currency TranslationDefined Benefit Pension PlanAccumulated
Other
Comprehensive Income (Loss)
Balances as of October 31, 2020($6,460)($2,689)($9,149)
Unrealized gain10,755 — 10,755 
Amortization of unrealized loss — 68 68 
Balances as of April 30, 2021$4,295 ($2,621)$1,674 









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4.     GOODWILL AND OTHER INTANGIBLE ASSETS

    Changes in the carrying amount of goodwill by operating segment for the six months ended April 30, 2021 are as follows (in thousands):
SegmentConsolidated Totals
FSGETG
Balances as of October 31, 2020$427,565 $955,602 $1,383,167 
Goodwill acquired— 11,428 11,428 
Foreign currency translation adjustments1,970 2,992 4,962 
Adjustments to goodwill188 303 491 
Balances as of April 30, 2021$429,723 $970,325 $1,400,048 
    
The goodwill acquired pertains to the fiscal 2021 acquisition described in Note 2, Acquisition, and represents the residual value after the allocation of the total consideration to the tangible and identifiable intangible assets acquired and liabilities assumed. Foreign currency translation adjustments are included in other comprehensive income (loss) in the Company's Condensed Consolidated Statements of Comprehensive Income. The adjustments to goodwill represent immaterial measurement period adjustments to the purchase price allocation of certain fiscal 2020 acquisitions. The Company estimates that all of the goodwill acquired in fiscal 2021 will be deductible for income tax purposes.

Identifiable intangible assets consist of the following (in thousands):
As of April 30, 2021As of October 31, 2020
Gross Carrying AmountAccumulated AmortizationNet Carrying AmountGross Carrying AmountAccumulated AmortizationNet Carrying Amount
Amortizing Assets:
Customer relationships$438,898 ($200,907)$237,991 $443,143 ($188,919)$254,224 
Intellectual property243,974 (94,507)149,467 240,725 (84,686)156,039 
Licenses6,559 (4,888)1,671 6,559 (4,670)1,889 
Patents1,085 (771)314 1,071 (746)325 
Non-compete agreements724 (724) 811 (811) 
Trade names450 (238)212 450 (219)231 
691,690 (302,035)389,655 692,759 (280,051)412,708 
Non-Amortizing Assets:
Trade names167,895 — 167,895 166,333 — 166,333 
$859,585 ($302,035)$557,550 $859,092 ($280,051)$579,041 
    
    





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Amortization expense related to intangible assets for the six months ended April 30, 2021 and 2020 was $30.3 million and $27.6 million, respectively. Amortization expense related to intangible assets for the three months ended April 30, 2021 and 2020 was $15.1 million and $13.9 million, respectively. Amortization expense related to intangible assets for the remainder of fiscal 2021 is estimated to be $30.0 million. Amortization expense for each of the next five fiscal years and thereafter is estimated to be $53.7 million in fiscal 2022, $48.1 million in fiscal 2023, $43.2 million in fiscal 2024, $38.8 million in fiscal 2025, $34.4 million in fiscal 2026, and $141.5 million thereafter.


5.     LONG-TERM DEBT

    Long-term debt consists of the following (in thousands):
April 30, 2021October 31, 2020
Borrowings under revolving credit facility$575,000