Laurans A. Mendelson - Chairman, Chief Executive Officer and Chairman of Executive Committee Eric A. Mendelson - Co-President, Director, Member of Environmental, Safety & Health Committee, Chief Executive Officer of Heico Aerospace Holdings Corp and President of Heico Aerospace Holdings Corp Victor H. Mendelson - Co-President, Director, Member of Environmental, Safety & Health Committee, Chief Executive Officer of Heico Electronic Technologies Corp and President of Heico Electronic Technologies Corp Thomas S. Irwin - Senior Executive Vice President and Member of The Office of The Chief Executive Officer

Stephen E. Levenson - Stifel, Nicolaus & Co., Inc., Research Division Tyler Hojo - Sidoti & Company, LLC Arnold Ursaner - CJS Securities, Inc. Julie Yates - Crédit Suisse AG, Research Division Ken Herbert Michael F. Ciarmoli - KeyBanc Capital Markets Inc., Research Division Chris Quilty - Raymond James & Associates, Inc., Research Division James Foung - Gabelli & Company, Inc.

Good morning. My name is Jennifer, and I will be your conference operator today. At this time, I would like to welcome everyone to the HEICO Corporation Third Quarter Fiscal 2013 Earnings Conference Call. [Operator Instructions] Your host today is Laurans A. Mendelson, Chairman and Chief Executive Officer of HEICO Corporation. Before the conference call begins, I will read the following statement. Certain statements in this conference call will constitute forward-looking statements, which are subject to risks, uncertainties and contingencies. HEICO's actual results may differ materially from those expressed and are 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, which could cause lower demand for our goods and services; 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 competitive -- competition from existing and new competitors, which could reduce our sales; HEICO's ability to introduce new sales products and product pricing levels, which could reduce our sales or sales growth; HEICO's ability to make acquisitions and achieve operating synergies from acquired businesses; customer credit risk, interest, income tax rates and economic conditions within and outside of the aviation, defense, space, medical, telecommunication and electronic industries, which could negatively impact our costs and revenues. 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 filing forms on 10-K, 10-Q and 8-K. We undertake no obligation to publicly update or revise any forward-looking statement whether as a result of new information, further events or otherwise. Thank you. I will now turn the conference over to Laurans Mendelson.

Thank you, Jennifer, and good morning to everyone on this call. We thank you for joining us and we welcome you to the HEICO third quarter fiscal 2013 earnings announcement telecon. I'm Larry Mendelson. I'm the Chairman and CEO of HEICO Corporation. And I'm 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 Vice President -- Senior Executive Vice President, I'm sorry; and Carlos Macau, our Executive Vice President and CFO. Before reviewing our third quarter operating results in detail, I would like to take a few minutes to summarize the highlights of another record-setting quarter. Our consolidated third quarter 2013 net sales, operating income and net income represent record quarterly results, driven principally by record net sales and operating income within our Flight Support Group, as well as continued strong net sales and operating income within our Electronic Technologies Group. Consolidated year-to-date net sales, operating income and net income represent all-time record results for HEICO, driven principally by record net sales and operating income within both segments. Consolidated third quarter fiscal '13 net income and operating income are up 25% and 14%, respectively, on an 18% increase in net sales over the third quarter of fiscal '12. Consolidated net income and operating income for the first 9 months of fiscal '13 are up 18% and 9%, respectively, on a 10% increase in net sales over the first 9 months of fiscal '12. Our Flight Support Group set a quarterly net sales and operating income record in the third quarter of fiscal '13, improving 29% and 24%, respectively, over the third quarter of fiscal '12. The increases principally reflect strong organic growth of approximately 17%, as well as…

Thank you. The Flight Support Group's net sales increased 29% to a record $181.3 million for the third quarter of fiscal '13, and increased 13% to a record $475.6 million for the first 9 months of fiscal '13, up from $140.8 million and $420.7 million for the third quarter and first 9 months of fiscal '12, respectively. The increase in the third quarter and first 9 months of fiscal '13 reflects organic growth of approximately 17% and 7%, respectively, as well as additional net sales of $16.1 million and $23.5 million, respectively, from fiscal '13 and '12 acquisitions. The organic growth for the third quarter and the first 9 months of fiscal '13 principally reflects an increase in net sales from new product offerings and improving market conditions within our aftermarket replacement parts and repair and overhaul services product lines and within our specialty products line. The Flight Support Group's operating income for the third quarter of fiscal '13 increased 24% to a record $32.6 million, up from $26.4 million for the third quarter of fiscal '12, and increased 11% to a record $87.2 million for the first 9 months of fiscal '13, up from $78.5 million for the first 9 months of fiscal '12. The increase for the third quarter and first 9 months of fiscal '13 is primarily attributed to the previously mentioned net sales growth. The Flight Support Group's operating margin equaled 18% and 18.3% for the third quarter and first 9 months of fiscal '13, respectively, compared to 18.7% for both the third quarter and first 9 months of fiscal '12. The slight decrease for the third quarter and first 9 months of fiscal '13 principally reflects the impact of additional amortization expense from intangible assets recognized in connection with the fiscal '13 and '12 acquisitions. Now I would like 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 1% to $87.4 million for the third quarter of fiscal '13, and increased by 5% to a record $250.2 million for the first 9 months of fiscal '13, up from $86.5 million and $237.2 million for the third quarter and first 9 months of fiscal 2012, respectively. The increase in the third quarter and first 9 months of fiscal '13 reflects organic growth of approximately 1% and 3%, respectively, primarily attributed to an increase in demand for certain space products, partially offset by a decrease in demand for some defense products. Further, the net sales increase for the first 9 months of fiscal '13 reflects additional net sales of $4.9 million from fiscal 2012 acquisitions. The Electronic Technologies Group's operating income for the third quarter of fiscal '13 increased by 3% to $21.5 million, and increased by 9% to a record $57.3 million for the first 9 months of fiscal '13, up from $21 million and $52.5 million for the third quarter and first 9 months of fiscal 2012, respectively. The increase for the third quarter and first 9 months of fiscal '13 is principally attributed to the previously mentioned improved operating margins and increased net sales. The Electronic Technologies Group's operating margin improved by 24.6% and 22.9% for the third quarter and first 9 months of fiscal '13, respectively, up from 24.2% and 22.1% for the third quarter and first 9 months of fiscal 2012, respectively. These increases principally reflect the previously mentioned more favorable product mix for certain higher margin space products. And now I turn the call back over to Larry Mendelson.

Thank you, Victor and Eric. Going to the diluted earnings per share, consolidated net income per diluted share increased 26% to $0.54 in the third quarter of fiscal '13, and that was up from $0.43 in the third quarter fiscal '12, principally driven by continued strong performances from both of our segments and the $0.03 tax-related benefit from higher tax credits based on fiscal 2012 tax returns, which were filed during the current quarter. Net income per diluted share for the third quarter of fiscal '12 included a similar tax-related benefit, which was equal to $0.02. Consolidated net income per diluted share increased 18% to $1.36 in the first 9 months of fiscal '13, and this was up from $1.15 in the first 9 months of fiscal '12, principally driven by continued strong performances from both of our operating segments. Depreciation and amortization expense increased by $1.8 million and $3.7 million in the third quarter and first 9 months of fiscal '13, and that was up from $7.7 million and $22.2 million in the third quarter and first 9 months of fiscal '12. The increase in both periods principally reflects higher amortization expense of intangible assets recognized in connection with our fiscal '12 and '13 acquisitions. The noncash charge for amortization expense associated with intangible assets equaled $5.4 million or 2% of net sales in the third quarter of fiscal '13. And it was $4.2 million in the third quarter of fiscal '12. It equaled $14.3 million or 2% of net sales in the first 9 months of fiscal '13 and $11.7 million in the first 9 months of 2012. Research and development expense increased 14% to $8.5 million in the third quarter of '13, and this was up from $7.5 million in the third quarter of '12. And it…

[Operator Instructions] Your first question will come from Steve Levenson with Stifel. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc., Research Division: Continue to surprise us and -- mostly on the FSG side. So I was going to ask, was the result so strong because of, and I've got 4 choices for you, anticipation -- increased MRO activity from the high level of air travel going on to summer and previously in the year? Or are there a larger portion -- is there a larger portion of the fleet coming into a regular service interval? Do you also see some restocking from low inventory levels at distributors and service providers and a higher confidence in MRO outlook, or it's really a combination of all 3?

Steve, I'm going to ask Eric to respond, please.

So your first component of that question was, is it a due to an increase in ASM? Yes, I think that, that's helping. ASMs are up, what, mid-single digits, and so that definitely helps. Two, yes, I think a larger portion of the fleet is getting into, if you will, that sweet spot. Of course, that is offset by a number of retirements there. Roughly half of what Boeing and Airbus are producing now is being used to replace existing aircraft. So the equation is the drop there, offset by the benefit of the remaining roughly 15,000 aircraft aging 1 year per year, and so that has helped as well. With regard to restocking, I would say no, we have not seen that. Other manufacturers perhaps have seen restocking. We maintain significant inventories, so our customers don't have to hold big inventories. They're used to that. It's part of our, if you will, friendly service offering, with no significant price increases and holding a lot of inventory. So we are not seeing them restock. As a matter of fact, some major airlines have gone -- I just got into the details about 10 days ago on this, is that major airlines have gone from about 6 months inventory down to 1 month of inventory. And that's what they're expecting from us and that's what we're providing. So no, we're not seeing them wanting to invest in inventory. Stephen E. Levenson - Stifel, Nicolaus & Co., Inc., Research Division: Okay, great. Last one is just on the cash flow. With prices being asked on M&A opportunities, do you see yourself more towards -- leaning towards doing those transactions or repaying debt?

Well, the answer is both. We are not a capital-constrained company by any means, so we continue to use all of our cash flow to reduce debt. And then that has really nothing to do with our appetite for acquisition. And we have a wonderful bank line, a wonderful group of banks. We also have half of Wall Street knocking on Tom and Carlos' door everyday to lend us money, give us money, sell stock, so we have no capital constraint. And we are looking at many acquisitions, but we're -- as you know, we're quite disciplined and we're not going to pay crazy prices. And we want to make sure that these acquisitions are accretive, really, in the first 12 months of acquisition, so we're going to do both. And as you know, as I mentioned, our EBITDA to debt is less than 1.5x, so we just have plenty of firepower and total flexibility. So we are doing both very aggressively.

Your next question is from Tyler Hojo with Sidoti. Tyler Hojo - Sidoti & Company, LLC: Just in regards to your guidance for Flight Support Group, when you talk about kind of moderating growth in the fourth quarter, would you expect kind of sales volumes for the Flight Support Group in the fourth quarter to be lower than they were in the third quarter?

Tyler, this is Eric. I'm going to answer that. I would say that we do not anticipate 17% organic growth in the fourth quarter. I think we sort of -- our folks knocked it out of the park this quarter and frankly, even greatly surprised us because the markets are not growing. In our opinion, after being at some of these conferences and speaking with my peers and other investors, I don't think the market at all is growing by 17%. I do not think the PMA market, in particular, is growing by 17%. I think that this is really due to HEICO's culture, which has been developed over decades of having these autonomous business units where we really trust these folks to go out there and find the opportunities. So to answer your question, as we enter the fourth quarter, we do expect it to be up over the fourth quarter of 2012, but would not necessarily anticipate an increase over the third quarter in 2013, because, I mean, these numbers were just so outstanding that I think it's going to be hard to grow above that rate. I mean, 17% growth is, in particular, in this market, when the tide is not going up that much, I think, is really at breakneck pace. And even though we've got 150 sales folks out in the field in the Flight Support Group, they can't continue to do that every single quarter.

This as Larry. I just have one comment and it's from 30,000 feet. Our guys never fail to surprise me in their accomplishments. They're heavily motivated, incentivized. And the answer is, honestly, I don't know and Eric doesn't know. We have a feeling and we try to be on the conservative side, but we won't know until October 31 when the results are in, so... Tyler Hojo - Sidoti & Company, LLC: Yes, well, I would certainly agree that the 17% growth is impressive. Just in regards to the new part introductions that you kind of highlighted as being a driver for that growth, were any of those new part sales to new customers or were they all to existing customers?

Yes, I would say we continue to add new customers, I mean, obviously, not at the pace as we sell existing parts to existing customers, because there are only so many new customers to add out there. But I would say, most of it is existing parts to existing customers. And we're also seeing, in all of our business units, that I think I talked about this decentralized approach where typically, in larger businesses, they need to try to educate the folks out in the field to treat the customer like a customer. That comes naturally when you have -- when you operate in the condition with the size business units that we operate in and trust the folks out in the field to make the decision. So I think people want to move their purchases to us, and we're able to, what, pick up the benefit as a result of that. Tyler Hojo - Sidoti & Company, LLC: Okay. Wonderful. And just lastly for me, just in context with kind of the prior comments in regards to the mid-teen increase in R&D expense, I'm just kind of wondering how much further you can kind of ratchet up the number of PMAs and DERs that you can run through and get approved. I think at last count, we were talking about something like 500 new PMAs and DERs per year.

Yes. I would say, in terms of us having the engineering ability to do more, we could do more. The issue is what can the customers really approve and digest. And I think we're at a good number right now. I think it's a good solid number. I think there's obviously some additional products that we can go out and develop, and the customers are always speaking to us about that. But I would say, there's no theoretical limit to what we can develop. But in terms of getting the customers to buy it, that's really the key thing. Tyler Hojo - Sidoti & Company, LLC: So the actual FAA approval to process isn't necessarily the biggest gating factor in terms of the approvals, is that accurate?

That's correct. I would say, for us, it is not. It's instead making sure that we have a home for these parts, because it's real easy, in theory, to go out there and take a look at what airlines are buying and to just assume that you'll end up picking up market share and you'll -- to assume that you'll end up supplying these parts. And I have to point out that our competitors don't see market share easily. It's a fight, it's hand-to-hand combat every day, working to make sure that we get these parts sold. So in theory, yes, you can work up a spreadsheet and show we can develop all these parts, we're going to sell them to all these customers, it doesn't really work that way. And instead, you really have to get down to the details, and that's really where we're particularly good at doing that.

Your next question is from Arnie Ursaner with CJS.

Couple of questions regarding Reinhold, if I can. Obviously, you are absorbing amortization and some expenses related to the acquisition, including perhaps marking up inventory. Can Tom perhaps give us a better feel for the impact in this quarter, direct impact from Reinhold?

Yes. As Larry mentioned, most of the impact in the quarter was the amortization of the intangible assets. There was some write-up of inventory that's being, if you will, amortized as we ship the inventory. But the more meaningful impact was, at the operating margin line, was the amortization.

Okay. And can you quantify that?

I guess [indiscernible] -- yes, the amortization increase was about $1.2 million.

Just from Reinhold, because to the extent, you typically -- I heard a 3% to 5% depreciation, amortization, when you make an acquisition, yet you mentioned, I think, this was only 2% of net sales.

The amortization number of $1.2 million, that includes all acquisitions added since the prior period, so there was more than Reinhold. Reinhold, of course, was the biggest component. Typically, our amortization -- it varies by the type of the business and typically, amortization or the intangible amortization as customer relations, intellectual property and depending on the life, et cetera, et cetera, of the underlying products and nature of the business, the lives could change quite a bit. But I would say, typically, it's running, as a percentage of sales, at 2% to 4%.

So if we exclude that factor, would it be fair to say that Reinhold had the operating margins much closer to the high 20s than the 18% you're reporting after the various amortization expenses?

Again, we don't disclose operating margins by -- certainly by business entities or actually by product line. I would say that Reinhold is performing as we expected. As we mentioned, when we bought it, we expect it to be accretive the first year. It was slightly accretive in the quarter. We expect still that it'd be accretive for the full year. But again, we don't freight out margins by product lines or by business units.

Okay. My last question, you mentioned on your last call, the leverage ratio at year end might be 1.75 or less and yet, this quarter, it was 1.47. What caused this enormously positive change?

Larry Mendelson's conservatism. We just -- it was really that because we don't like to get out ahead of ourselves and it was -- what you're-- I think, Arnie, what you're inferring is that we thought there might be an acquisition that would have pushed it back up. But no, we were just trying to be on the conservative side and not try to get out ahead of what was happening. That's really all.

Your next question is from Julie Stewart with Crédit Suisse. Julie Yates - Crédit Suisse AG, Research Division: I think, the last call, you guys characterized how much of the organic growth in Flight Support was attributable to aftermarket. I think last quarter, it was 80%. Can you give a similar metric for the 17% organic growth, and how much of that was driven by aftermarket this quarter?

Julie, this is Tom. I would say, quick and very off the top comparable amounts, when you think about Flight Support Group other than a bit of the OEM markets and the specialty products areas effectively aftermarket, either PMA parts, distribution, whether it's PMAs or component repair and overhaul. So I would say, again, we haven't had the exact computation, but it is probably comparable. Julie Yates - Crédit Suisse AG, Research Division: Okay, great. And then Victor, one for you, can you provide some more granularity on what's going on in ETG by end market? You've referenced the decrease in defense products and then that there's some offset from the space products. But over the next 9 to 12 months, can we still expect kind of that low to mid single digit organic growth profile in that segment?

Julie, this is Victor. I think we can, I would say, definitely on the low side of that. And in terms of the individual markets that we're dealing with, as we said before, our commercial space businesses are pretty strong. And right now, we anticipate that should continue for at least, we would think, the next 6 months and possibly well beyond that. But it gets foggier once we really get out further. I would expect defense to continue to be soft. I think on the last call, I indicated that we had just sort of gone into it and I think that's picked up steam and that will continue to pick up steam a little bit in terms of the budget cuts and weakness in defense. And then our other markets that we serve have been more or less pretty healthy in the medical side, I think, where we have some components there. Those have done nicely and the outlook is pretty good for those. And in the general markets that we serve, kind of like electronics and technology markets, it's kind of a mixed bag out there right now. Some good news, some bad news, as we go. Julie Yates - Crédit Suisse AG, Research Division: Okay. And then can you remind us the end market split for ETG? So how much is defense versus space, medical and then the other markets?

So when you look at the business, overall, defense is a little bit less than 30% now. It's probably about 28% or somewhere around that range, but let's say a little bit less than 30% all in. And that would include some space that we have. Our -- the general kind of other markets that we serve is probably comparable in that range. And then space is probably somewhere in the neighborhood of 10% to 15%, somewhere around there. And that would be mostly commercial space or almost entirely commercial space. Julie Yates - Crédit Suisse AG, Research Division: Okay. And so medical is just included in that general bucket?

Medical would be in that general bucket.

Your next question is from Ken Herbert with Canaccord.

First, Eric, if I could, I just wanted to go back to the growth question just one more time. Are you seeing anything different, specifically within the PMA versus the distribution or the DER or the repair sides of the business in terms of the growth? I mean, I know Seal Dynamics and Blue have typically been doing very well, but are you seeing comparable growth on the PMA side?

Yes, I would say we're seeing growth in all of our markets. And I think, again, what's driving this growth is not -- I mean, I think your question is, you're trying to get to how are the end markets doing. And I don't think that this is, again, is an end market thing. I don't think the PMA market overall is growing at this rate. I think that this is really more of a HEICO-specific thing as a result of really the way we're structured with our business units and 150 sales people we've got out there in the field who are out there mining and mining and mining to find all these opportunities. And I think they're the ones who are really uncovering the opportunities. It's not the customer's job to contact us when they need something, but we have to be in front of a customer, and that's why we have to make this major investment. And obviously, it costs a lot of money to have these folks out there in the field. But we think that we've got to have -- by having these dedicated sales forces and by having so many people out there and having this kind of coverage, I think that's why we're able, as a company, to have these results and I think, frankly, outgrow our competitors in all of our different end markets.

That's helpful. Just by type, within the engine side, are you seeing any variation in demand, say, for some of the strong legacy, PW4000 or JT9D engines on the wide-body side versus maybe your CFM56 product line?

Yes. We don't -- obviously, for competitive reasons, we can't get into product line specific information. And frankly, it bounces around based on what customers may need. So what's strong this quarter may not be strong next quarter. But I wouldn't say that the strength is coming really from any one area. It's really the entire portfolio that we've got, all the different products and services. And frankly, these business units work together and are able to secure deals as a result of the breadth of the products that we're doing. And by having all these different folks out in the field, we're able to find opportunities and present them to one of the other HEICO business units that may ordinarily not have that kind of opportunity. So I think a lot of this is, in addition to the, if you will, the DNA of the company, a lot of it is really due to our size and our ability to refer business from one business unit to the other. And, frankly, that was really helpful this quarter and we were able, I think as a result of HEICO's breadth of products, we were able to do a bunch of new stuff that we had not done in the past. And it was really as a result of being in all these different end markets. It was not due to a particular strength in any one market.

Okay, great. That's helpful. And just finally, Larry, you've talked about -- now you read about 1.5x in terms of the leverage, when you talk about the debt-to-EBITDA. What's the upper level that you think the company can support? Or specifically, what level or what leverage are you comfortable with at the upper end?

Well, the answer is I really don't know. And we just do what we've got to do. I would be comfortable on -- in some cases at 4x. I don't think I'd be comfortable, with some companies go up to 7x, but I think at 4x, I would live with 4x. But it all depends on what we're buying, what the cash flow looks like. But I like to be under 2x, but we'll go to 3x or 4x, without a big problem, depending upon that acquisition. Again, we want to make sure that what we buy, what we leverage to buy has to have a very, very strong likelihood of being able to pay back the debt relatively quickly. We don't like long term, long payout debt and so forth, then -- so -- but I want to add to that, that if we -- which we do, with Tom and Carlos putting together our own cash flow projections, our earnings growth projections, we can meet what we target, which is 20%. We say that we think we can do 20% in the next few years and continue to grow like that. We can do that without putting on a tremendous amount of debt and getting over 3x or 4x, and then having it come down pretty quickly, and we've modeled that. So I would -- I don't foresee going past 3x or 4x at most.

Your next question is from Michael Ciarmoli with KeyBanc.

Just to dig a little deeper on the Flight Support growth. Can you give us a sense if you're seeing more strength on the part side or the service side? I guess what I'm getting at is that there's still an influx or growing influx of surplus parts. Is that giving you guys a bit of a tailwind in your component repair facilities or the growth rate you're seeing there?

Yes. Michael, this is Eric. We're seeing the growth really across the businesses. And we do have -- we do offer some asset management services as well, and of course, that's been helped through the growth in the teardowns there. But I think we're really seeing it pretty broad based in what we're doing. Again, I don't think it's the end markets growing at this rate. As I've said before, I think it's more a matter of the business units going out and specifically finding those opportunities, because I think we have a competitive advantage in the way that we're structured. We don't go to market in the Flight Support Group as one business doing many hundred millions of dollars. I mean, it's broken down into smaller business units who are really able to go out and hunt and clean their fish and cook it and do it all by themselves. So I think that's why the business is doing so well.

Got you. And then just on -- in terms of the R&D spending, can you give us a sense of what product areas you're focusing on? I mean, is it engine, is it inside the cabin, is it more kind of prepping up for maybe composite repairs that might be coming down the pipe? Can you just give us a sense of what the spending is kind of geared towards?

Yes, I would say it's across the board. We continue to develop all of the above. I would say it's more focused in the non-engine area. Our non-engine business is now over half of our total sales and we had -- continue to have tremendous focus in that area, but we continue to develop engine parts as well. And I think the fact that we have the engine legacy in the engine business is very important because those are viewed as, and they are, very critical parts. And in order to have the credibility to sell an engine part, the customer really, really needs to trust you because that's an expensive piece of equipment and it's very expensive if they ever need to pull out the part. So I think as a result of having the credibility on the engine side, it's opening up opportunities for us in terms of critical components as well that are -- most people probably wouldn't think of as opportunities for PMA or aftermarket. But it's really -- so it all, if you will, works together. It's a broad product offering in a broad customer relationship that, if you will, all fits together. We can't dissect it, if you will, into one area or another.

Okay. Perfect, that's helpful. And then the last one for me. Just on the whole US Air-American merger, can you just remind us, I mean, your thoughts there? Would that combined entity be a benefit to you guys with kind of your presence at each carrier? Just remind us, if you can, how -- in terms of customer relationships there and maybe your general thoughts on that kind of transaction where it stands.

Yes. Mike, we've gotten this question a lot from many different folks. And as you know, unfortunately, we can't go into detail by either customers or product lines for competitive reasons. But we think that HEICO is well positioned regardless of how this turns out. And we've got very good relationships with both airlines and they think that it will be a very good merger and therefore, we think it will be a good merger. It will be good for the industry, it will be good for HEICO as well. We certainly hope that they do it. But I think regardless, we're going to be in a good position.

Your next question is from Chris Quilty with Raymond James. Chris Quilty - Raymond James & Associates, Inc., Research Division: Follow-up maybe with a little bit more offbeat question here. But with some of the new developments in engine technology around ceramics and new materials, additive or 3D printing, can you kind of give us a thought on where you see the move -- the industry moving in terms of sort of technology, your ability to compete with some of the new parts that are eventually going to be hitting the market, and whether Ryan and I can buy a 3D printer and get in competition with you, perhaps?

Yes, we're -- Chris, this is Eric. We're not concerned about the new technologies that are out there. I mean, we also use a lot of these technologies as well, specifically with respect to 3D printing. You've got to be very careful with the recast provider that the parts could have as a result of such a process. I don't really see, despite what you read in the press, I don't see mechanics having 3D printers just whipping up a part that they need right there on the tarmac and sticking it into the airplane, in general. I'm not saying that can't happen in a specific case. But I think that's more hype than anything else. And it's certainly nothing that's going to impact us for a long time. I mean, if you figure it takes, what, 5, 7 years to develop a new aircraft or engine, and then they sell it for 20 years and then it continues flying. The last one continues flying 25 years after it's delivered. I mean, there's a very long cycle in here in manufacturers. And the FAA are very hesitant to change the process once something is up and going, be it certified and it works and you know it works and you don't want to take that level of risk in unknown by changing something. So I don't really see that affecting current generation. And I think with regard to future generation, we'll be just fine with the technology and we're staying up on all this as well. And remember, with the breadth of product, we see a lot of different stuff with engines, with the components and interiors, and I think we're going to be in a good position to take advantage of that. Chris Quilty - Raymond James & Associates, Inc., Research Division: So that's interesting. Government agencies are resistant to change, I'll remember that.

Well, I didn't say everybody. I mean, we all are -- we all tend to be resistant to change and government, certainly, our large customers, the engineering community, in general, is resistant to change, so I think we're going to do just fine.

Wait. Chris, just a -- this is Larry. I'm trying to recollect, but didn't Obama say that he brings change that you can rely on? Didn't he promise government change you can rely on? Chris Quilty - Raymond James & Associates, Inc., Research Division: Something like that.

Hope and change.

Hope and change. We're having hope and change. Chris Quilty - Raymond James & Associates, Inc., Research Division: Good. Okay. So one other question. I think there was an article with, I think, in Wall Street Journal recently talking about the number of pilots getting sucked into the Chinese market because of the growth of the market there, lots of acquisitions of parts and component companies. Can you give us an update on where you stand in your effort in China specifically?

Yes, we -- well, again, we don't like to give too much specifics for competitive reasons, but we are present in China. And I think we can do a lot more in China. We -- there's a tremendous amount of what I consider to be unsold potential through our entire business in China. It's not just a matter, in some cases, of walking in the door and selling the product. I mean, there's a lot of homework that needs to be done. But we are successful over there, but I think that we have tremendous upside opportunity.

And your final question is from James Foung with Gabelli. James Foung - Gabelli & Company, Inc.: I just have one question, since everything else seems to be have answered. Regarding Reinhold, I noticed that [indiscernible] sense. And I was just kind of wondering, how big is the exposure? And there was this potential conflict with Syria. Do you anticipate any big orders from the U.S. government in this area?

Yes. Jim, this is Eric, and I think that's a good question. And when we bought Reinhold, they have a lot of proprietary composite missile technology. And when we bought it, of course, there was this thought that peace could break out and missiles would never be needed to be used, and we never bought into that. They've been -- they continue to be very successful in what they do. The products that they sell, basically the missile, they get shot once and that's it. And I think that this issue with Syria just shows that the United States needs to continue to maintain its technological lead and its dominance and we need to be present in the defense area in many different areas, because there are plenty of crazy people out there. And as long as they exist, the United States really has an opportunity to provide these parts. So I think Reinhold is in a very good position there. We're doing both commercial, as well as military. And it's nice because they somewhat they balance each other and we think both are very advantageous markets for us to be in. We're on long-range missiles, we're on short-range missiles, we're on all sorts of things. So it -- I think that there's a very good opportunity for us there. James Foung - Gabelli & Company, Inc.: Well, I guess 2 things is, could you just give us a sense of how big its exposure, HEICO's missile defense business is? And I guess if there were -- if this conflict gets dragged out, the more it gets dragged out, the more likelihood the government needs to replenish its inventory on these things. And so maybe you can give us a sense of how big of a potential increase in orders you might see?

Jim, we're not really sure. And actually, I don't have the missile numbers in front of me right now because, of course, it's in both sides of the business, but -- and the other issue is you never know what the current inventories look like of those missiles. Majority of Reinhold's missile defense sales are for foreign military markets. So you can just imagine, I mean, what's going on in Syria is probably quite good for the foreign military market. [indiscernible] because there are a lot of countries that want to protect themselves, so we think that there's a lot of opportunity there. But I wouldn't view it as anything that would significantly change the business or where we're headed or what we've said. I think it's sort of just all embedded in what we do. I mean, if there's opportunity over because of what's happening in Syria unfortunately, that could be offset by reduced demand elsewhere. So I wouldn't necessarily look at it just by itself. I think you've got to look at it all together. James Foung - Gabelli & Company, Inc.: Right, okay. But still, overall, it's positive. I mean, the situation is what it is, but it's positive for you guys in terms of...

Definitely positive. And Reinhold, again, has a great relationship with its customers to go to a place for what they do. And I think we're going to be in a very good position to continue supplying what we're supplying, as well as to make additional stuff for these missile OEMs.

Jim, I just want to mention one thing. When we talk about these missile parts that we make at Reinhold, these are highly engineered parts. Now some people have an idea that a missile is something like a bullet casing or something like that, these are very, very highly refined machine parts where composites are applied to the surface for heat resistant, and they're extremely, extremely complex casings. So we're talking about a highly, highly engineered product, not some kind of a flimflam thing, just like a tube or like a bazooka tool or something like that. This is a very, very well engineered, manufactured to close tolerance a piece of equipment and that's why they operate as well as they do.

And I think just to put some leads on that is the product that Reinhold does is an ablative technology where basically the composite burns off when it's in flight and protects the missile itself. So it's a very sophisticated, complex technology, and we don't see that -- we see that continuing in demand.

And it's hard to replicate this. Other people aren't going to go out and say," I'm just going to put some gunpowder in a tube and shoot it." But it's not the way it works. It's very complex. James Foung - Gabelli & Company, Inc.: Do you have competitors in this space or is Reinhold the only provider of this?

No, we have competitors. I mean, we have competitors in much of what we do, I would say, most of what we do. And certainly, there are competitors, and it's sort of interesting. I think there is an interesting point. I think one of the reasons why we succeed so well is because we do face, in all these businesses, aggressive competition. And it's not like we're the only game out in town, where we can get fat and lazy. I mean, we have to be very aggressive and we've got to continue to mine these opportunities, but they're definitely all competitive.

Your next question is from Rene Plessner.

I just have one comment, which is woohoo. As you know -- well, I just want to congratulate all of you. This is above and beyond expectations, as we've just heard. I have been a happy shareholder for 20 years and I just want to thank you for the brilliant way you run the company.

Rene, I thank you very much, and you've been a great supporter of HEICO and you've had confidence in it, the management team. And you've been very well rewarded as so many the other listeners on this call, but we try very hard and we're going to try to continue to perform. But thank you so much for your kind comment.

You're very welcome, may it ever beat us.

I'd also like to say -- take this -- as long as compliments are being given, I'd like to take this time to really thank the team members of HEICO who are responsible for the performance of HEICO. We have some amazing, amazing team leaders that run some of these subsidiaries. You can't -- the financial community can't follow them on the balance sheet or the P&L. You can see their tracks on the P&L, but you can't see their capability. Without mentioning them by name, they know who they are, but these people, I think, are extraordinary. They have vision, they have hard work, they have honesty, integrity, a great commitment to HEICO. They themselves have done very well financially and continue -- and we -- that's great. We want to incentivize people, but they -- we have a wonderful, wonderful team out in the field working every day. And on behalf of myself and the Board of Directors, I want to take this public opportunity to thank them all. Hello?

Well, if I'm just -- if I'm still on, amen. And if I'm not on, onto the next.

Well, I'm waiting for Jennifer, she is the operator.

At this time, you have no further questions.

Okay. If that is all, if there are no further questions, I thank everyone who is interested in HEICO and has been listening, and remind you that we are available for questions, should you have any. Give us a call and we're open to try to respond to your questions. We look forward to speaking to you at the -- sometime in late December when we have the fourth quarter and the year end wrap-up for 2013. Again, thank you, all, for your interest in HEICO.

Thank you. Ladies and gentlemen, this does conclude today's conference call. You may now disconnect.