GlobeNewswire Inc | Oct 8, 2020 06:30AM EDT

October 08, 2020

NEWTON, Kan., Oct. 08, 2020 (GLOBE NEWSWIRE) -- Park Aerospace Corp. (NYSE-PKE) reported results for the 2021 fiscal year second quarter ended August 30, 2020. As previously reported, Park completed the sale of its Electronics Business to AGC Inc. on December 4, 2018. Therefore, current costs relating to the sale of the Electronics Business are reported as discontinued operations. Continuing operations discussed below refer to Parks Aerospace Business unless otherwise indicated.

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/2ozuh39n 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 Companys website at www.parkaerospace.com under Investor Conference Calls on the Shareholders page.

Continuing Operations:

Park reported net sales of $9,250,000 for the 2021 fiscal year second quarter ended August 30, 2020 compared to $13,723,000 for the 2019 fiscal year second quarter ended September 1, 2019 and $12,213,000 for the 2021 fiscal year first quarter ended May 31, 2020. Parks net sales from continuing operations for the six months ended August 30, 2020 were $21,463,000 compared to $28,673,000 for the six months ended September 1, 2019. Net earnings from continuing operations for the 2021 fiscal year second quarter were $1,151,000 compared to $2,052,000 for the 2020 fiscal year second quarter and $1,972,000 for the 2021 fiscal year first quarter. Net earnings from continuing operations were $3,123,000 for the current years first six months compared to $4,766,000 for last years first six months.

EBITDA from continuing operations for the 2021 fiscal year second quarter was $1,418,000 compared to $2,406,000 for the 2020 fiscal year second quarter and $2,364,000 for the 2021 fiscal year first quarter.

For the six months ended August 30, 2020, Park reported net earnings from continuing operations before special items of $3,123,000 compared to $4,910,000 for last fiscal years first six months. In the 2020 fiscal years 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. EBITDA from continuing operations for the current years first six months was $3,782,000 compared to $5,779,000 for last years first six months.

Park reported basic and diluted earnings per share from continuing operations of $0.06 for the 2021 fiscal year second quarter compared to $0.10 for the 2020 fiscal year second quarter and $0.10 for the 2021 fiscal year first quarter.

Park reported basic and diluted earnings per share from continuing operations of $0.15 for the 2021 fiscal years first six months compared to $0.23 for the 2020 fiscal years first six months. Basic and diluted earnings per share from continuing operations before special items were $0.15 for the 2021 fiscal years first six months compared to $0.24 for the 2020 fiscal years 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. The required passcode for attendance by phone is 8867788.

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 14, 2020. The conference call replay will be available at https://edge.media-server.com/mmc/p/2ozuh39n and on the Companys website at www.parkaerospace.com under Investor Conference Calls on the Shareholders page. It can also be accessed by dialing (855) 859-2056 in the United States and Canada, and (404) 537-3406 in other countries. The required passcode for accessing the replay by phone is 8867788.

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 one-time tax charge 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 Companys operating performance, since the Companys 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. develops and manufactures solution and hot-melt advanced composite materials used to produce composite structures for the global aerospace markets. These materials include lightning strike protection materials. Park offers an array of composite materials specifically designed for hand lay-up or automated fiber placement (AFP) manufacturing applications. Parks 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 Parks advanced composite materials offering, Park designs and fabricates composite parts, structures and assemblies and low volume tooling for the aerospace industry. Target markets for Parks composite parts and structures (which include Parks 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. Parks 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 Companys 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 August 30, September May 31, 2020 August 30, September 1, 2020 1, 2019 2020 2019Sales $ 9,250 $ 13,723 $ 12,213 $ 21,463 $ 28,673 Net Earningsbefore $ 1,151 $ 2,052 $ 1,972 $ 3,123 $ 4,910 SpecialItems^1SpecialItems, Net of Tax:Tax Impactof Cancelled - - - (144 ) StockOptionsNet Earningsfrom $ 1,151 $ 2,052 $ 1,972 $ 3,123 $ 4,766 ContinuingOperations (Loss)Earningsfrom $ (197 ) $ 83 $ (15 ) $ (212 ) $ (44 ) DiscontinuedOperations,Net of Tax Net Earnings $ 954 $ 2,135 $ 1,957 $ 2,911 $ 4,722 BasicEarnings per Share:BasicEarningsbefore $ 0.06 $ 0.10 $ 0.10 $ 0.15 $ 0.24 SpecialItems^1Special Items:Tax Impactof Cancelled - - - - (0.01 ) StockOptionsBasicEarnings perShare from $ 0.06 $ 0.10 $ 0.10 $ 0.15 $ 0.23 ContinuingOperations Basic Lossper Sharefrom (0.01 ) - - (0.01 ) - DiscontinuedOperations BasicEarnings per $ 0.05 $ 0.10 $ 0.10 $ 0.14 $ 0.23 Share DilutedEarningsbefore $ 0.06 $ 0.10 $ 0.10 $ 0.15 $ 0.24 SpecialItems^1Special Items:Tax Impactof Cancelled - - - - (0.01 ) StockOptionsDilutedEarnings perShare from $ 0.06 $ 0.10 $ 0.10 $ 0.15 $ 0.23 ContinuingOperations Diluted Lossper Sharefrom (0.01 ) - - (0.01 ) - DiscontinuedOperations DilutedEarnings per $ 0.05 $ 0.10 $ 0.10 $ 0.14 $ 0.23 Share WeightedAverage SharesOutstanding:Basic 20,381 20,499 20,402 20,392 20,495 Diluted 20,433 20,601 20,460 20,447 20,593 ^1 Refer to "Reconciliation of non-GAAP financial measures" below for information regarding Special Items.

Comparative balance sheets (in thousands)

August 30, 2020 March 1, 2020 Assets (unaudited) Current Assets Cash and Marketable Securities $ 118,690 $ 122,355 Accounts Receivable, Net 7,270 10,925 Inventories 5,103 6,379 Prepaid Expenses and Other Current Assets 3,783 5,535 Total Current Assets 134,846 145,194 Fixed Assets, Net 19,479 16,100 Operating Right-of-use Assets 341 420 Other Assets 10,057 10,072 Total Assets $ 164,723 $ 171,786 Liabilities and Shareholders' Equity Current Liabilities Accounts Payable $ 1,899 $ 4,735 Accrued Liabilities 1,408 1,709 Operating Lease Liability 132 152 Income Taxes Payable 2,641 2,111 Total Current Liabilities 6,080 8,707 Long-term Operating Lease Liability 221 268 Non-current Income Taxes Payable 14,303 15,986 Deferred Income Taxes 738 834 Other Liabilities 4,421 4,316 Total Liabilities 25,763 30,111 Shareholders? Equity 138,960 141,675 Total Liabilities and Shareholders' Equity $ 164,723 $ 171,786 Additional information Equity per Share $ 6.82 $ 6.90



Comparative statements of operations (in thousands unaudited):

13 Weeks Ended 26 Weeks Ended August 30, September 1, May 31, 2020 August 30, September 1, 2020 2019 2020 2019 Net Sales $ 9,250 $ 13,723 $ 12,213 $ 21,463 $ 28,673 Cost of Sales 6,612 9,910 8,539 15,151 20,056 Gross Profit 2,638 3,813 3,674 6,312 8,617 % of net sales 28.5% 27.8% 30.1% 29.4% 30.1% Selling,General & 1,552 1,914 1,630 3,182 3,836 AdministrativeExpenses% of net sales 16.8% 13.9% 13.3% 14.8% 13.4% Earnings fromContinuing 1,086 1,899 2,044 3,130 4,781 Operations Interest and Other Income:Interest 525 863 656 1,181 1,811 Income% of net sales 5.7% 6.3% 5.4% 5.5% 6.3% Earnings fromContinuingOperations 1,611 2,762 2,700 4,311 6,592 before IncomeTaxes Income Tax 460 710 728 1,188 1,826 Provision Net Earningsfrom 1,151 2,052 1,972 3,123 4,766 ContinuingOperations% of net sales 12.4% 15.0% 16.1% 14.6% 16.6% (Loss)Earnings fromDiscontinued (197 ) 83 (15 ) (212 ) (44 ) Operations,Net of Tax Net Earnings $ 954 $ 2,135 $ 1,957 $ 2,911 $ 4,722 % of net sales 10.3% 15.6% 16.0% 13.6% 16.5%

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

13 Weeks Ended August 30, 13 Weeks Ended September 1, 13 Weeks Ended May 31, 2020 2020 2019 Specials Before Specials Before Specials Before GAAP Items Special GAAP Items Special GAAP Items Special Items Items Items Earningsfrom 1,086 - 1,086 1,899 - 1,899 2,044 - 2,044 ContinuingOperations% of net 11.7% 11.7% 13.8% 13.8% 16.7% 16.7% sales Interest 525 - 525 863 - 863 656 - 656 Income% of net 5.7% 5.7% 6.3% 6.3% 5.4% 5.4% sales EarningsfromContinuing 1,611 - 1,611 2,762 - 2,762 2,700 - 2,700 OperationsbeforeIncome Taxes% of net 17.4% 17.4% 20.1% 20.1% 22.1% 22.1% sales Income Tax 460 - 460 710 - 710 728 - 728 ProvisionEffective 28.6% 28.6% 25.7% 25.7% 27.0% 27.0% Tax Rate Net Earningsfrom 1,151 - 1,151 2,052 - 2,052 1,972 - 1,972 ContinuingOperations% of net 12.4% 12.4% 15.0% 15.0% 16.1% 16.1% sales (Loss)Earningsfrom (197 ) (197 ) 83 83 (15 ) - (15 ) DiscontinuedOperations% of net -2.1% -2.1% 0.6% 0.6% -0.1% -0.1% sales Net Earnings 954 - 954 2,135 - 2,135 1,957 - 1,957 % of net 10.3% 10.3% 15.6% 15.6% 16.0% 16.0% sales Earningsfrom 1,086 1,899 2,044 ContinuingOperationsAddbacknon-cash expenses:Depreciation 282 366 277 Stock Option 50 141 43 ExpenseEBITDA 1,418 2,406 2,364 Reconciliation of non-GAAP financial measures - continued (in thousands ?unaudited): 26 Weeks Ended August 30, 26 Weeks Ended September 1, 2020 2019 Specials Before Specials Before GAAP Items Special GAAP Items Special Items ItemsEarningsfrom 3,130 - 3,130 4,781 - 4,781 ContinuingOperations% of net 14.6% 14.6% 16.7% 16.7% sales Interest 1,181 1,181 1,811 - 1,811 Income% of net 5.5% 5.5% 6.3% 6.3% sales EarningsfromContinuing 4,311 - 4,311 6,592 - 6,592 OperationsbeforeIncome Taxes% of net 20.1% 20.1% 23.0% 23.0% sales Income Tax 1,188 - 1,188 1,826 (144) 1,682 ProvisionEffective 27.6% 27.6% 27.7% 25.5% Tax Rate Net Earningsfrom 3,123 - 3,123 4,766 144 4,910 ContinuingOperations% of net 14.6% 14.6% 16.6% 17.1% sales Loss fromDiscontinued (212 ) - (212 ) (44 ) - (44 ) Operations% of net -1.0% -1.0% -0.2% -0.2% sales Net Earnings 2,911 - 2,911 4,722 144 4,866 % of net 13.6% 13.6% 16.5% 17.0% sales Earningsfrom 3,130 4,781 OperationsAddbacknon-cash expenses:Depreciation 559 733 Stock Option 93 265 ExpenseEBITDA 3,782 5,779

Contact:Donna DAmico-Annitto486 North Oliver Road, Bldg. Z Newton, Kansas 67114(316) 283-6500