Park Aerospace Corp. (NYSE-PKE) reported results for the 2024
fiscal year first quarter ended May 28, 2023. The Company will
conduct a conference call to discuss its financial results and
other matters at 11:00 a.m. EDT today. A live audio webcast of the
event, along with presentation materials, will be available at
https://edge.media-server.com/mmc/p/o3artqt4 at 11:00 a.m. EDT
today. The presentation materials will also be available at
approximately 9:00 a.m. EDT today at
https://parkaerospace.com/shareholders/investor-conference-calls/
and on the Company’s website at www.parkaerospace.com under
“Investor Conference Calls” on the “Shareholders” page.
Park reported net sales of $15,551,000 for the
2024 fiscal year first quarter ended May 28, 2023 compared to
$12,783,000 for the 2023 fiscal year first quarter ended May 29,
2022 and $13,530,000 for the 2023 fiscal year fourth quarter ended
February 26, 2023. Net earnings for the 2024 fiscal year first
quarter were $1,854,000 compared to $1,910,000 for the 2023 fiscal
year first quarter and $4,706,000 for the 2023 fiscal year fourth
quarter.
Net earnings before special items for the 2024
fiscal year first quarter were $2,407,000 compared to $1,910,000
for the 2023 fiscal year first quarter and $1,976,000 for the 2023
fiscal year fourth quarter. Adjusted EBITDA for the 2024 fiscal
year first quarter was $3,311,000 compared to $2,804,000 for the
2023 fiscal year first quarter and $2,625,000 for the 2023 fiscal
year fourth quarter.
The Company recorded $570,000 of pre-tax
activist shareholder defense costs, $65,000 of pre-tax losses on
sales of investments to fund the $1.00 per share special dividend
paid on April 6, 2023 to shareholders of record on March 9, 2023
and a $109,000 pre-tax charge for the modification of previously
granted stock options in connection with the special dividend in
the 2024 fiscal year first quarter. The Company recognized a tax
benefit of $2,791,000 in the 2023 fiscal year fourth quarter
primarily from the reduction of uncertain tax positions related to
expiring statute of limitations on tax positions taken in prior
years regarding the taxability of funds repatriated from the
Company’s subsidiary in Singapore, and the Company recorded $61,000
of additional tax expense for tax deductions becoming unavailable
related to stock options expiring unexercised in the 2023 fiscal
year fourth quarter.
Park reported basic and diluted earnings per
share of $0.09 for the 2024 fiscal year first quarter compared to
$0.09 for the 2023 fiscal year first quarter and $0.23 for the 2023
fiscal year fourth quarter. Basic and diluted earnings per share
before special items were $0.12 for the 2024 fiscal year first
quarter compared to $0.09 for the 2023 fiscal year first quarter
and $0.10 for the 2023 fiscal year fourth quarter.
The Company will conduct a conference call to
discuss its financial results at 11:00 a.m. EDT today.
Forward-looking and other material information may be discussed in
this conference call. The conference call dial-in number is (877)
407-3982 in the United States and Canada, and (201) 493-6780 in
other countries. The required passcode for attendance by phone is
13739595.
For those unable to listen to the call live, a
conference call replay will be available from approximately 2:00
p.m. EDT today through 11:59 p.m. EDT on Thursday, July 13, 2023.
The conference call replay will be available at
https://edge.media-server.com/mmc/p/o3artqt4 and on the Company’s
website at www.parkaerospace.com under “Investor Conference Calls”
on the “Shareholders” page. It can also be accessed by dialing
(844) 512-2921 in the United States and Canada and (412) 317-6671
in other countries. The required passcode for accessing the replay
by phone is 13739595.
Any additional material financial or statistical
data disclosed in the conference call, including the investor
presentation, will also be available at the time of the conference
call on the Company's web site
at https://parkaerospace.com/shareholders/investor-conference-calls/.
Park believes that an evaluation of its ongoing
operations would be difficult if the disclosure of its operating
results were limited to accounting principles generally accepted in
the United States of America (“GAAP”) financial measures, which
include special items, such as activist shareholder defense costs,
losses on sales of investments, charge for modification of
previously granted stock options, reductions in uncertain tax
positions and tax deductions becoming unavailable. Accordingly, in
addition to disclosing its operating results determined in
accordance with GAAP, Park discloses non-GAAP measures, including
Adjusted EBITDA, and operating results that exclude special items
in order to assist its shareholders and other readers in assessing
the Company’s operating performance, since the Company’s on-going,
normal business operations do not include such special items. The
detailed operating information presented below includes a
reconciliation of the non-GAAP operating results before special
items to earnings determined in accordance with GAAP and a
reconciliation of GAAP pre-tax earnings to Adjusted EBITDA. Such
non-GAAP financial measures are provided to supplement the results
provided in accordance with GAAP.
Park Aerospace Corp. develops and manufactures
solution and hot-melt advanced composite materials used to produce
composite structures for the global aerospace markets. Park’s
advanced composite materials include film adhesives and lightning
strike protection materials. Park offers an array of composite
materials specifically designed for hand lay-up or automated fiber
placement (AFP) manufacturing applications. Park’s advanced
composite materials are used to produce primary and secondary
structures for jet engines, large and regional transport aircraft,
military aircraft, Unmanned Aerial Vehicles (UAVs commonly referred
to as “drones”), business jets, general aviation aircraft and
rotary wing aircraft. Park also offers specialty ablative materials
for rocket motors and nozzles and specially designed materials for
radome applications. As a complement to Park’s advanced composite
materials offering, Park designs and fabricates composite parts,
structures and assemblies and low volume tooling for the aerospace
industry. Target markets for Park’s composite parts and structures
(which include Park’s proprietary composite SigmaStrut™ and
AlphaStrut™ product lines) are, among others, prototype and
development aircraft, special mission aircraft, spares for legacy
military and civilian aircraft and exotic spacecraft. Park’s
objective is to do what others are either unwilling or unable to
do. When nobody else wants to do it because it is too difficult,
too small or too annoying, sign us up.
Additional corporate information is available on
the Company’s web site at
www.parkaerospace.com
Performance table, including non-GAAP
information (in thousands, except per share amounts
–unaudited):
|
13 Weeks Ended |
|
|
|
|
|
|
|
|
May 28, 2023 |
|
|
May 29, 2022 |
|
|
February 26, 2023 |
|
Sales |
$ |
15,551 |
|
|
|
$ |
12,783 |
|
|
$ |
13,530 |
|
|
|
|
|
|
|
|
|
|
|
Net Earnings
before Special Items1 |
$ |
2,407 |
|
|
|
$ |
1,910 |
|
|
$ |
1,976 |
|
|
Special
Items, Net of Tax: |
|
|
|
|
|
|
|
|
Activist Shareholder Defense Costs |
|
(424 |
) |
|
|
|
- |
|
|
|
- |
|
|
Stock Option Modification |
|
(81 |
) |
|
|
|
- |
|
|
|
- |
|
|
Loss on Sale of Marketable Securities |
|
(48 |
) |
|
|
|
- |
|
|
|
- |
|
|
Reduction in Uncertain Tax Positions |
|
- |
|
|
|
|
- |
|
|
|
2,791 |
|
|
Tax Impact of Cancelled Stock Options |
|
- |
|
|
|
|
- |
|
|
|
(61 |
) |
|
Net
Earnings |
$ |
1,854 |
|
|
|
$ |
1,910 |
|
|
$ |
4,706 |
|
|
|
|
|
|
|
|
|
|
|
Basic
Earnings per Share: |
|
|
|
|
|
|
|
|
Basic
Earnings before Special Items1 |
$ |
0.12 |
|
|
|
$ |
0.09 |
|
|
$ |
0.10 |
|
|
Special Items: |
|
|
|
|
|
|
|
|
Activist Shareholder Defense Costs |
|
(0.02 |
) |
|
|
|
- |
|
|
|
- |
|
|
Stock Option Modification |
|
(0.01 |
) |
|
|
|
- |
|
|
|
- |
|
|
Loss on Sale of Marketable Securities |
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Reduction in Uncertain Tax Positions |
|
- |
|
|
|
|
- |
|
|
|
0.13 |
|
|
Tax Impact of Cancelled Stock Options |
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Basic Earnings per
Share |
$ |
0.09 |
|
|
|
$ |
0.09 |
|
|
$ |
0.23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
Earnings before Special Items1 |
$ |
0.12 |
|
|
|
$ |
0.09 |
|
|
$ |
0.10 |
|
|
Special Items: |
|
|
|
|
|
|
|
|
Activist Shareholder Defense Costs |
|
(0.02 |
) |
|
|
|
- |
|
|
|
- |
|
|
Stock Option Modification |
|
(0.01 |
) |
|
|
|
- |
|
|
|
- |
|
|
Loss on Sale of Marketable Securities |
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Reduction in Uncertain Tax Positions |
|
- |
|
|
|
|
- |
|
|
|
0.13 |
|
|
Tax Impact of Cancelled Stock Options |
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Diluted Earnings per
Share |
$ |
0.09 |
|
|
|
$ |
0.09 |
|
|
$ |
0.23 |
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average Shares Outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
20,461 |
|
|
|
|
20,458 |
|
|
|
20,471 |
|
|
Diluted |
|
20,526 |
|
|
|
|
20,504 |
|
|
|
20,518 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Refer to
"Reconciliation of non-GAAP financial measures" below for
information regarding Special Items. |
Comparative balance sheets (in
thousands):
|
May 28, 2023 |
|
February 26, 2023 |
|
Assets |
(unaudited) |
|
|
|
Current
Assets |
|
|
|
|
Cash and Marketable Securities |
$ |
81,105 |
|
$ |
105,440 |
|
Accounts Receivable, Net |
|
11,600 |
|
|
9,989 |
|
Inventories |
|
7,911 |
|
|
6,768 |
|
Prepaid Expenses and Other Current Assets |
|
2,691 |
|
|
2,844 |
|
Total Current Assets |
|
103,307 |
|
|
125,041 |
|
|
|
|
|
|
Fixed
Assets, Net |
|
24,112 |
|
|
24,251 |
|
Operating
Right-of-use Assets |
|
136 |
|
|
150 |
|
Other
Assets |
|
9,888 |
|
|
9,891 |
|
Total Assets |
$ |
137,443 |
|
$ |
159,333 |
|
|
|
|
|
|
Liabilities
and Shareholders' Equity |
|
|
|
|
Current
Liabilities |
|
|
|
|
Accounts Payable |
$ |
3,859 |
|
$ |
4,545 |
|
Accrued Liabilities |
|
1,984 |
|
|
1,346 |
|
Dividend Payable |
|
- |
|
|
20,471 |
|
Operating Lease Liability |
|
53 |
|
|
53 |
|
Income Taxes Payable |
|
3,902 |
|
|
2,171 |
|
Total Current Liabilities |
|
9,798 |
|
|
28,586 |
|
|
|
|
|
|
Long-term
Operating Lease Liability |
|
118 |
|
|
129 |
|
Non-current
Income Taxes Payable |
|
9,255 |
|
|
10,938 |
|
Deferred
Income Taxes |
|
1,996 |
|
|
1,995 |
|
Other
Liabilities |
|
1,782 |
|
|
1,751 |
|
Total Liabilities |
|
22,949 |
|
|
43,399 |
|
|
|
|
|
|
Shareholders’ Equity |
|
114,494 |
|
|
115,934 |
|
|
|
|
|
|
Total Liabilities and
Shareholders' Equity |
$ |
137,443 |
|
$ |
159,333 |
|
|
|
|
|
|
Additional
information |
|
|
|
|
Equity per
Share |
$ |
5.63 |
|
$ |
5.66 |
|
|
|
|
|
|
Comparative statements of operations (in
thousands – unaudited):
|
13 Weeks Ended |
|
|
|
|
|
|
|
|
|
|
|
May 28, 2023 |
|
|
May 29, 2022 |
|
|
February 26, 2023 |
|
|
|
|
|
|
|
|
|
|
Net Sales |
$ |
15,551 |
|
|
|
$ |
12,783 |
|
|
|
$ |
13,530 |
|
|
|
|
|
|
|
|
|
|
|
Cost of
Sales |
|
10,718 |
|
|
|
|
8,691 |
|
|
|
|
9,679 |
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit |
|
4,833 |
|
|
|
|
4,092 |
|
|
|
|
3,851 |
|
|
% of net sales |
|
31.1 |
% |
|
|
|
32.0 |
% |
|
|
|
28.5 |
% |
|
|
|
|
|
|
|
|
|
|
Selling,
General & Administrative Expenses |
|
2,615 |
|
|
|
|
1,633 |
|
|
|
|
1,631 |
|
|
% of net sales |
|
16.8 |
% |
|
|
|
12.8 |
% |
|
|
|
12.1 |
% |
|
|
|
|
|
|
|
|
|
|
Earnings
from Operations |
|
2,218 |
|
|
|
|
2,459 |
|
|
|
|
2,220 |
|
|
|
|
|
|
|
|
|
|
|
Interest and
Other Income: |
|
|
|
|
|
|
|
|
Interest Income |
|
324 |
|
|
|
|
133 |
|
|
|
|
425 |
|
|
|
|
|
|
|
|
|
|
|
Earnings
from Operations before Income Taxes |
|
2,542 |
|
|
|
|
2,592 |
|
|
|
|
2,645 |
|
|
|
|
|
|
|
|
|
|
|
Income Tax
Provision / (Benefit) |
|
688 |
|
|
|
|
682 |
|
|
|
|
(2,061 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings |
$ |
1,854 |
|
|
|
$ |
1,910 |
|
|
|
$ |
4,706 |
|
|
% of net sales |
|
11.9 |
% |
|
|
|
14.9 |
% |
|
|
|
34.8 |
% |
|
|
|
|
|
|
|
|
|
|
Reconciliation of non-GAAP financial measures
(in thousands – unaudited):
|
13 Weeks Ended May 28, 2023 |
|
|
13 Weeks Ended May 29, 2022 |
|
|
13 Weeks Ended February 26, 2023 |
|
|
GAAP |
|
Specials Items |
|
Before Special Items |
|
|
GAAP |
|
Specials Items |
|
Before Special Items |
|
|
GAAP |
|
Specials Items |
|
Before Special Items |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, General & Administrative Expenses |
$ |
2,615 |
|
|
$ |
(679 |
) |
|
$ |
1,936 |
|
|
|
$ |
1,633 |
|
|
$ |
- |
|
$ |
1,633 |
|
|
|
$ |
1,631 |
|
|
$ |
- |
|
|
$ |
1,631 |
|
|
% of net sales |
|
16.8 |
% |
|
|
|
|
12.4 |
% |
|
|
|
12.8 |
% |
|
|
|
|
12.8 |
% |
|
|
|
12.1 |
% |
|
|
|
|
12.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
from Operations |
|
2,218 |
|
|
|
679 |
|
|
|
2,897 |
|
|
|
|
2,459 |
|
|
|
- |
|
|
2,459 |
|
|
|
|
2,220 |
|
|
|
- |
|
|
|
2,220 |
|
|
% of net sales |
|
14.3 |
% |
|
|
|
|
18.6 |
% |
|
|
|
19.2 |
% |
|
|
|
|
19.2 |
% |
|
|
|
16.4 |
% |
|
|
|
|
16.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Income |
|
324 |
|
|
|
65 |
|
|
|
389 |
|
|
|
|
133 |
|
|
|
- |
|
|
133 |
|
|
|
|
425 |
|
|
|
- |
|
|
|
425 |
|
|
% of net sales |
|
2.1 |
% |
|
|
|
|
2.5 |
% |
|
|
|
1.0 |
% |
|
|
|
|
1.0 |
% |
|
|
|
3.1 |
% |
|
|
|
|
3.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
from Operations before Income Taxes |
|
2,542 |
|
|
|
744 |
|
|
|
3,286 |
|
|
|
|
2,592 |
|
|
|
- |
|
|
2,592 |
|
|
|
|
2,645 |
|
|
|
- |
|
|
|
2,645 |
|
|
% of net sales |
|
16.3 |
% |
|
|
|
|
21.1 |
% |
|
|
|
20.3 |
% |
|
|
|
|
20.3 |
% |
|
|
|
19.5 |
% |
|
|
|
|
19.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Tax
Provision / (Benefit) |
|
688 |
|
|
|
191 |
|
|
|
879 |
|
|
|
|
682 |
|
|
|
- |
|
|
682 |
|
|
|
|
(2,061 |
) |
|
|
2,730 |
|
|
|
669 |
|
|
Effective Tax Rate |
|
27.1 |
% |
|
|
|
|
26.7 |
% |
|
|
|
26.3 |
% |
|
|
|
|
26.3 |
% |
|
|
|
-77.9 |
% |
|
|
|
|
25.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings |
|
1,854 |
|
|
|
553 |
|
|
|
2,407 |
|
|
|
|
1,910 |
|
|
|
- |
|
|
1,910 |
|
|
|
|
4,706 |
|
|
|
(2,730 |
) |
|
|
1,976 |
|
|
% of net sales |
|
11.9 |
% |
|
|
|
|
15.5 |
% |
|
|
|
14.9 |
% |
|
|
|
|
14.9 |
% |
|
|
|
34.8 |
% |
|
|
|
|
14.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings Before Special Items |
|
|
|
|
2,407 |
|
|
|
|
|
|
|
|
1,910 |
|
|
|
|
|
|
|
|
1,976 |
|
|
Addback
non-cash expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Tax Provision |
|
|
|
|
|
879 |
|
|
|
|
|
|
|
|
682 |
|
|
|
|
|
|
|
|
669 |
|
|
Interest Income |
|
|
|
|
|
(389 |
) |
|
|
|
|
|
|
|
(133 |
) |
|
|
|
|
|
|
|
(425 |
) |
|
Depreciation |
|
|
|
|
|
305 |
|
|
|
|
|
|
|
|
260 |
|
|
|
|
|
|
|
|
310 |
|
|
Stock Option Expense |
|
|
|
|
|
109 |
|
|
|
|
|
|
|
|
85 |
|
|
|
|
|
|
|
|
95 |
|
|
Adjusted
EBITDA |
|
|
|
|
|
3,311 |
|
|
|
|
|
|
|
|
2,804 |
|
|
|
|
|
|
|
|
2,625 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contact: |
Donna D’Amico-Annitto |
486 North Oliver Road, Bldg. Z |
|
|
|
Newton, Kansas 67114 |
|
|
|
(316) 283-6500 |
|
|
|
|
|
Park Aerospace (NYSE:PKE)
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