Park Electrochemical Corp. Reports First Quarter Results

MELVILLE, N.Y., June 29, 2016 (GLOBE NEWSWIRE) — Park Electrochemical Corp. (NYSE:PKE) reported net sales of $31,490,000 for the 2017 fiscal year’s first quarter ended May 29, 2016 compared to net sales of $37,829,000 for last fiscal year’s first quarter ended May 31, 2015 and net sales of $35,756,000 for last fiscal year’s fourth quarter ended February 28, 2016. Net earnings for the current year’s first quarter were $2,950,000 compared to $4,777,000 for last year’s first quarter and $4,574,000 for last year’s fourth quarter.

Park reported net earnings before special items of $2,993,000 for the current year’s first quarter compared to net earnings before special items of $4,867,000 for last year’s first quarter and net earnings before special items of $4,865,000 for last year’s fourth quarter. In the current year’s first quarter, the Company recorded pre-tax restructuring charges of $70,000 related to the closure in fiscal year 2009 of its New England Laminates Co., Inc. facility located in Newburgh, New York. In last year’s first quarter, the Company recorded a pre-tax charge of $124,000 related to the aforementioned facility closure and the closure in fiscal year 2013 of the Company’s Nelco Technology (Zhuhai FTZ) Ltd. facility located in Zhuhai, China. In last year’s fourth quarter, the Company recorded pre-tax restructuring charges of $162,000 in connection with the aforementioned facility closures and pre-tax deferred financing costs of $292,000 related to the early termination of the PNC Bank credit agreement. As previously reported, the Company entered into a three-year revolving credit facility agreement with HSBC Bank USA in January 2016, which replaced the credit facility agreement that the Company entered into with PNC Bank in February 2014.

Park reported basic and diluted earnings per share of $0.15 for the current year’s first quarter compared to basic and diluted earnings per share of $0.23 for both last year’s first quarter and last year’s fourth quarter.

Basic and diluted earnings per share before special items were $0.15 for the current year’s first quarter compared to basic and diluted earnings per share before special items of $0.24 for both last year’s first quarter and last year’s 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 (844) 466-4114 in the United States and Canada and (765) 507-2654 in other countries and the required passcode is 37601667.

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 Tuesday, July 5, 2016.  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 37601667 or on the Company’s web site at www.parkelectro.com/investor/investor.html.

Any additional material financial or statistical data disclosed in the conference call will also be available at the time of the conference call on the Company’s web site at www.parkelectro.com/investor/investor.html.

Park believes that an evaluation of its ongoing operations would be difficult if the disclosure of its financial results were limited to accounting principles generally accepted in the United States of America (“GAAP”) financial measures, which include special items, such as restructuring charges and deferred financing costs. Accordingly, in addition to disclosing its financial results determined in accordance with GAAP, Park discloses non-GAAP 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 reconciles the non-GAAP operating results before special items to earnings determined in accordance with GAAP. Such non-GAAP financial measures are provided to supplement the results provided in accordance with GAAP.

Park Electrochemical Corp. is a global advanced materials company which develops and manufactures high-technology digital and RF/microwave printed circuit materials principally for the telecommunications and internet infrastructure and high-end computing markets and advanced composite materials, parts and assemblies and low-volume tooling for the aerospace markets. Park’s core capabilities are in the areas of polymer chemistry formulation and coating technology.  The Company’s manufacturing facilities are located in Singapore, France, Kansas, Arizona and California. The Company also maintains R&D facilities in Arizona, Kansas and Singapore. 

Additional corporate information is available on the Company’s web site at www.parkelectro.com

Performance table, including non-GAAP information (in thousands, except per share amounts –unaudited):
		13 Weeks Ended
		May 29, 2016					May 31, 2015					February 28, 2016
	Sales	$	31,490				$	37,829				$	35,756
	Net Earnings before Special Items1	$	2,993				$	4,867				$	4,865
	Special Items, net of Tax:
	Restructuring Charges		(43	)				(90	)				(110	)
	Deferred Financing Costs		–					–					(181	)
	Net Earnings	$	2,950				$	4,777				$	4,574
	Basic and Diluted Earnings per Share:
	Basic Earnings before Special Items1	$	0.15				$	0.24				$	0.24
	Special Items:
	Restructuring Charges		–					(0.01	)				–
	Deferred Financing Costs		–					–					(0.01	)
	Basic Earnings per Share	$	0.15				$	0.23				$	0.23
	Diluted Earnings before Special Items1	$	0.15				$	0.24				$	0.24
	Special Items:
	Restructuring Charges		–					(0.01	)				–
	Deferred Financing Costs		–					–					(0.01	)
	Diluted Earnings per Share	$	0.15				$	0.23				$	0.23
	Weighted Average Shares Outstanding:
	Basic		20,235					20,546					20,251
	Diluted		20,235					20,565					20,251
	1 Refer to “Reconciliation of non-GAAP financial measures” below for information regarding Special Items.

 

Comparative balance sheets (in thousands):
		May 29, 2016 (unaudited)				February 28, 2016
	Assets
	Current Assets
	Cash and Marketable Securities	$	242,404			$	237,425
	Accounts Receivable, Net		18,420				22,583
	Inventories		12,000				10,214
	Prepaid Expenses and Other Current Assets		2,322				1,963
	Total Current Assets		275,146				272,185
	Fixed Assets, Net		20,743				21,512
	Restricted Cash		10,000				10,000
	Other Assets		11,114				11,080
	Total Assets	$	317,003			$	314,777
	Liabilities and Shareholders’ Equity
	Current Liabilities
	Current Portion of Long-Term Debt	$	3,000			$	3,000
	Accounts Payable		6,838				6,155
	Accrued Liabilities		5,211				4,580
	Income Taxes Payable		3,464				2,943
	Total Current Liabilities		18,513				16,678
	Long-Term Debt		71,250				72,000
	Deferred Income Taxes		43,937				43,937
	Other Liabilities		1,242				1,295
	Total Liabilities		134,942				133,910
	Shareholders’ Equity		182,061				180,867
	Total Liabilities and Shareholders’ Equity	$	317,003			$	314,777
	Additional information
	Equity per Share	$	9.00			$	8.94
	Total Cash, Restricted Cash and Marketable Securities	$	252,404			$	247,425

Comparative statements of operations (in thousands – unaudited):
		13 Weeks Ended
		May 29, 2016					May 31, 2015					February 28, 2016
	Net Sales	$	31,490				$	37,829				$	35,756
	Cost of Sales		22,703					26,462					25,029
	Gross Profit		8,787					11,367					10,727
	% of net sales		27.9	%				30.0	%				30.0	%
	Selling, General & Administrative   Expenses		5,337					5,801					5,137
	Restructuring Charge		70					124					162
	Earnings from Operations		3,380					5,442					5,428
	Interest:
	Interest Income		378					265					340
	Interest Expense		333					369					577
	Net Interest Expense		45					(104	)				(237	)
	Earnings before Income Taxes		3,425					5,338					5,191
	Income Tax Provision		475					561					617
	Net Earnings	$	2,950				$	4,777				$	4,574

 

Reconciliation of non-GAAP financial measures (in thousands – unaudited):
		13 Weeks Ended May 29, 2016													13 Weeks Ended May 31, 2015													13 Weeks Ended February 28, 2016
		GAAP				Specials Items				Before Special Items					GAAP				Specials Items				Before Special Items					GAAP				Specials Items				Before Special Items
	Restructuring Charge		70				(70	)			–					124				(124	)			–					162				(162	)			–
	% of net sales		0.2	%							0.0	%				0.3	%							0.0	%				0.5	%							0.0	%
	Earnings from Operations		3,380				70				3,450					5,442				124				5,566					5,428				162				5,590
	% of net sales		10.7	%							11.0	%				14.4	%							14.7	%				15.2	%							15.6	%
	Net Interest (Expense) Income		45				–				45					(104	)			–				(104	)				(237	)			292				55
	% of net sales		0.1	%							0.1	%				-0.3	%							-0.3	%				-0.7	%							0.2	%
	Earnings before Income Taxes		3,425				70				3,495					5,338				124				5,462					5,191				454				5,645
	% of net sales		10.9	%							11.1	%				14.1	%							14.4	%				14.5	%							15.8	%
	Income Tax Provision		475				27				502					561				34				595					617				163				780
	Effective Tax Rate		13.9	%							14.4	%				10.5	%							10.9	%				11.9	%							13.8	%
	Net Earnings		2,950				43				2,993					4,777				90				4,867					4,574				291				4,865
	% of net sales		9.4	%							9.5	%				12.6	%							12.9	%				12.8	%							13.6	%

 

 

CONTACT: Contact:
Martina Bar Kochva
48 South Service Road
Melville, NY 11747
(631) 465-3600