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MELVILLE, N.Y., Oct. 10, 2019 (GLOBE NEWSWIRE) — Park Aerospace Corp. (NYSE-PKE) reported results for the 2020 fiscal year second quarter ended September 1, 2019. As previously reported, Park completed the sale of its Electronics Business to AGC Inc. on December 4, 2018. Therefore, the results of operations for the Electronics Business in the prior year are reported as discontinued operations. Continuing operations discussed below refer to Park’s Aerospace Business unless otherwise indicated, and prior periods in such discussion have been restated to reflect results excluding the Electronics Business.

A live audio webcast, along with presentation materials, will be available at https://edge.media-server.com/mmc/p/ycr9hepo at 11:00 a.m. EDT on Thursday, October 10, 2019. The presentation materials will also be available at approximately 9:00 a.m. EDT on Thursday, October 10, 2019 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.

Continuing Operations:

Park reported net sales of $13,723,000 for the 2020 fiscal year second quarter ended September 1, 2019 compared to $11,211,000 for the 2019 fiscal year second quarter ended August 26, 2018 and $14,950,000 for the 2020 fiscal year first quarter ended June 2, 2019.  Park’s net sales from continuing operations for the six months ended September 1, 2019 were $28,673,000 compared to $21,604,000 for the six months ended August 26, 2018. Net earnings from continuing operations for the 2020 fiscal year second quarter were $2,052,000 compared to $1,824,000 for the 2019 fiscal year second quarter and $2,714,000 for the 2020 fiscal year first quarter. Net earnings from continuing operations were $4,766,000 for the current year’s first six months compared to $2,640,000 for last year’s first six months.

Park reported net earnings from continuing operations before special items of $2,052,000 for the 2020 fiscal year second quarter compared to $1,036,000 for the 2019 fiscal year second quarter and $2,858,000 for the 2020 fiscal year first quarter. In the 2019 fiscal year second quarter, the Company recorded a one-time tax benefit of $788,000 related to the Tax Cuts and Jobs Act enacted in December 2017. EBITDA from continuing operations for the 2020 fiscal year second quarter was $2,406,000 compared to $1,663,000 for the 2019 fiscal year second quarter and $3,372,000 for the 2020 fiscal year first quarter.

For the six months ended September 1, 2019, Park reported net earnings from continuing operations before special items of $4,910,000 compared to $1,852,000 for last fiscal year’s first six months.  In the 2020 fiscal year’s first six months, the Company recorded a one-time tax charge of $144,000 for the write down of deferred tax assets for stock option expirations pertaining to employees who transferred to AGC Inc. in connection with the sale of the electronics business. The 2019 fiscal year’s first six months included the one-time tax benefit of $788,000 mentioned above. EBITDA from continuing operations for the current year’s first six months was $5,779,000 compared to $3,045,000 for last year’s first six months.

Park reported basic and diluted earnings per share from continuing operations of $0.10 for the 2020 fiscal year second quarter compared to $0.09 for the 2019 fiscal year second quarter and $0.13 for the 2020 fiscal year first quarter. Basic and diluted earnings per share from continuing operations before special items were $0.10 for the 2020 fiscal year second quarter compared to $0.05 for the 2019 fiscal year second quarter and $0.14 for the 2020 fiscal year first quarter. 

Park reported basic and diluted earnings per share from continuing operations of $0.23 for the 2020 fiscal year’s first six months compared to $0.13 for the 2019 fiscal year’s first six months. Basic and diluted earnings per share from continuing operations before special items were $0.24 for the 2020 fiscal year’s first six months compared to $0.09 for 2019 fiscal year’s first six months. 

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 (844) 466-4114 in the United States and Canada and (765) 507-2654 in other countries and the required passcode is 8780956.

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 Wednesday, October 16, 2019.  The conference call replay can be accessed by dialing (855) 859-2056 in the United States and Canada and (404) 537-3406 in other countries and entering passcode 8780956 or on the Company’s web site at www.parkaerospace.com/investor/investor.html.

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 www.parkaerospace.com/investor/investor.html.

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 one-time tax charges and EBITDA. Accordingly, in addition to disclosing its operating results determined in accordance with GAAP, Park discloses non-GAAP measures including 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 EBITDA. Such non-GAAP financial measures are provided to supplement the results provided in accordance with GAAP.

Park Aerospace Corp. is an Aerospace Company which 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 (undergoing qualification) and lightning strike 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 Sigma Strut and Alpha Strut 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												26 Weeks Ended
	September 1, 2019				August 26, 2018				June 2, 2019				September 1, 2019					August 26, 2018
Sales	$	13,723			$	11,211			$	14,950			$	28,673				$	21,604
Net Earnings before Special Items1	$	2,052			$	1,036			$	2,858			$	4,910				$	1,852
Special Items, Net of Tax:
Tax Impact of Cancelled Stock Options		–				–				(144	)			(144	)				–
Tax Cuts and Jobs Act		–				788				–				–					788
Net Earnings from Continuing Operations	$	2,052			$	1,824			$	2,714			$	4,766				$	2,640
Earnings (Loss) from Discontinued Operations, Net of Tax	$	83			$	876			$	(127	)		$	(44	)			$	3,228
Net Earnings	$	2,135			$	2,700			$	2,587			$	4,722				$	5,868
Basic Earnings per Share:
Basic Earnings before Special Items1	$	0.10			$	0.05			$	0.14			$	0.24				$	0.09
Special Items:
Tax Impact of Cancelled Stock Options		–				–				(0.01	)			(0.01	)				–
Tax Cuts and Jobs Act		–				0.04				–				–					0.04
Basic Earnings per Share from Continuing Operations	$	0.10			$	0.09			$	0.13			$	0.23				$	0.13
Basic Earnings per Share from Discontinued Operations		–				0.04				–				–					0.16
Basic Earnings per Share	$	0.10			$	0.13			$	0.13			$	0.23				$	0.29
Diluted Earnings before Special Items1	$	0.10			$	0.05			$	0.14			$	0.24				$	0.09
Special Items:
Tax Impact of Cancelled Stock Options		–				–				(0.01	)			(0.01	)				–
Tax Cuts and Jobs Act		–				0.04				–				–					0.04
Diluted Earnings per Share from Continuing Operations	$	0.10			$	0.09			$	0.13			$	0.23				$	0.13
Diluted Earnings per Share from Discontinued Operations		–				0.04				–				–					0.16
Diluted Earnings per Share	$	0.10			$	0.13			$	0.13			$	0.23				$	0.29
Weighted Average Shares Outstanding:
Basic		20,499				20,253				20,492				20,495					20,248
Diluted		20,601				20,382				20,588				20,593					20,339

¹ Refer to “Reconciliation of non-GAAP financial measures” below for information regarding Special Items.

Comparative balance sheets (in thousands):

	September 1, 2019			March 3, 2019
Assets	(unaudited)
Current Assets
Cash and Marketable Securities	$	145,355		$	151,624
Accounts Receivable, Net		8,855			9,352
Inventories		4,626			5,267
Prepaid Expenses and Other Current Assets		1,913			1,690
Total Current Assets		160,749			167,933
Fixed Assets, Net		12,311			10,791
Operating Right-of-use Assets		373			–
Other Assets		10,096			10,127
Total Assets	$	183,529		$	188,851
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts Payable	$	1,819		$	3,169
Accrued Liabilities		1,952			2,920
Income Taxes Payable		1,481			5,066
Operating Lease Liability		109			–
Total Current Liabilities		5,361			11,155
Long-term Operating Lease Liability		264			–
Non-current Income Taxes Payable		15,986			17,669
Deferred Income Taxes		65			–
Other Liabilities		1,050			1,016
Total Liabilities		22,726			29,840
Shareholders’ Equity		160,803			159,011
Total Liabilities and Shareholders’ Equity	$	183,529		$	188,851
Additional information
Equity per Share	$	7.84		$	7.84

Comparative statements of operations (in thousands – unaudited):

	13 Weeks Ended															26 Weeks Ended
	September 1, 2019					August 26, 2018					June 2, 2019					September 1, 2019					August 26, 2018
Net Sales	$	13,723				$	11,211				$	14,950				$	28,673				$	21,604
Cost of Sales		9,910					8,066					10,146					20,056					15,607
Gross Profit		3,813					3,145					4,804					8,617					5,997
% of net sales		27.8	%				28.1	%				32.1	%				30.1	%				27.8	%
Selling, General & Administrative Expenses		1,914					2,116					1,922					3,836					4,217
% of net sales		13.9	%				18.9	%				12.9	%				13.4	%				19.5	%
Earnings from Continuing Operations		1,899					1,029					2,882					4,781					1,780
Interest and Other Income:
Interest Income		863					357					948					1,811					697
Earnings from Continuing Operations before Income Taxes		2,762					1,386					3,830					6,592					2,477
Income Tax Provision (Benefit)		710					(438	)				1,116					1,826					(163	)
Net Earnings from Continuing Operations		2,052					1,824					2,714					4,766					2,640
% of net sales		15.0	%				16.3	%				18.2	%				16.6	%				12.2	%
Earnings (Loss) from Discontinued Operations, Net of Tax		83					876					(127	)				(44	)				3,228
Net Earnings	$	2,135				$	2,700				$	2,587				$	4,722				$	5,868
% of net sales		15.6	%				24.1	%				17.3	%				16.5	%				27.2	%

Reconciliation of non-GAAP financial measures (in thousands – unaudited):

	13 Weeks Ended September 1, 2019												13 Weeks Ended August 26, 2018													13 Weeks Ended June 2, 2019
	GAAP				Specials Items			Before Special Items					GAAP				Specials Items				Before Special Items					GAAP				Specials Items				Before Special Items
Selling, General & Administrative Expenses	$	1,914			$	–		$	1,914				$	2,116			$	–			$	2,116				$	1,922			$	–			$	1,922
% of net sales		13.9	%						13.9	%				18.9	%							18.9	%				12.9	%							12.9	%
Earnings from Continuing Operations		1,899				–			1,899					1,029				–				1,029					2,882				–				2,882
% of net sales		13.8	%						13.8	%				9.2	%							9.2	%				19.3	%							19.3	%
Interest Income		863				–			863					357				–				357					948				–				948
% of net sales		6.3	%						6.3	%				3.2	%							3.2	%				6.3	%							6.3	%
Net Interest and Other Income		863				–			863					357				–				357					948				–				948
% of net sales		6.3	%						6.3	%				3.2	%							3.2	%				6.3	%							6.3	%
Earnings from Continuing Operations before Income Taxes		2,762				–			2,762					1,386				–				1,386					3,830				–				3,830
% of net sales		20.1	%						20.1	%				12.4	%							12.4	%				25.6	%							25.6	%
Income Tax Provision		710				–			710					(438	)			788				350					1,116				(144	)			972
Effective Tax Rate		25.7	%						25.7	%				-31.6	%							25.3	%				29.1	%							25.4	%
Net Earnings from Continuing Operations		2,052				–			2,052					1,824				(788	)			1,036					2,714				144				2,858
% of net sales		15.0	%						15.0	%				16.3	%							9.2	%				18.2	%							19.1	%
Earnings (Loss) from Discontinued Operations		83							83					876								876					(127	)			–				(127	)
% of net sales		0.6	%						0.6	%				7.8	%							7.8	%				-0.8	%							-0.8	%
Net Earnings		2,135				–			2,135					2,700				(788	)			1,912					2,587				144				2,731
% of net sales		15.6	%						15.6	%				24.1	%							17.1	%				17.3	%							18.3	%
Earnings from Continuing Operations									1,899													1,029													2,882
Addback non-cash expenses:
Depreciation									366													435													366
Stock Option Expense									141													199													124
EBITDA									2,406													1,663													3,372

Reconciliation of non-GAAP financial measures – continued (in thousands – unaudited):

	26 Weeks Ended September 1, 2019										26 Weeks Ended August 26, 2018
	GAAP			Specials Items			Before Special Items				GAAP			Specials Items			Before Special Items
Earnings from Operations	4,781			–			4,781				1,780			–			1,780
% of net sales	16.7	%					16.7	%			8.2	%					8.2	%
Interest Income	1,811						1,811				697			–			697
% of net sales	6.3	%					6.3	%			3.2	%					3.2	%
Interest Expense	–			–			–				–			–			–
% of net sales	0.0	%					0.0	%			0.0	%					0.0	%
Net Interest and Other Income	1,811			–			1,811				697			–			697
% of net sales	6.3	%					6.3	%			3.2	%					3.2	%
Earnings before Income Taxes	6,592			–			6,592				2,477			–			2,477
% of net sales	23.0	%					23.0	%			11.5	%					11.5	%
Income Tax Provision (Benefit)	1,826			(144	)		1,682				(163	)		788			625
Effective Tax Rate	27.7	%					25.5	%			-6.6	%					25.2	%
Net Earnings from continuing operations	4,766			144			4,910				2,640			(788	)		1,852
% of net sales	16.6	%					17.1	%			12.2	%					8.6	%
(Loss) Earnings from discontinued operations	(44	)		–			(44	)			3,228			–			3,228
% of net sales	-0.2	%					-0.2	%			14.9	%					14.9	%
Net Earnings	4,722			144			4,866				5,868			(788	)		5,080
% of net sales	16.5	%					17.0	%			27.2	%					23.5	%
Earnings from Operations							4,781										1,780
Addback non-cash expenses:
Depreciation							733										865
Stock Option Expense							265										400
EBITDA							5,779										3,045

Contact:		Donna D’Amico-Annitto		486 North Oliver Road, Bldg. Z Newton, Kansas 67114 (316) 283-6500