Park Aerospace Corp. Reports Fourth Quarter and Fiscal Year Results
May 11, 2023 at 06:31 am
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NEWTON, Kan., May 11, 2023 (GLOBE NEWSWIRE) -- Park Aerospace Corp. (NYSE-PKE) reported results for the 2023 fiscal year fourth quarter and full fiscal year ended February 26, 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/ssv8op68 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 $13,530,000 for the 2023 fiscal year fourth quarter ended February 26, 2023 compared to $12,502,000 for the 2022 fiscal year fourth quarter ended February 27, 2022 and $13,867,000 for the 2023 fiscal year third quarter ended November 27, 2022. Park’s net sales for the fiscal year ended February 26, 2023 were $54,055,000 compared to $53,578,000 for the fiscal year ended February 27, 2022. Net earnings for the 2023 fiscal year fourth quarter were $4,706,000 compared to $1,956,000 for the 2022 fiscal year fourth quarter and $2,230,000 for the 2023 fiscal year third quarter. Net earnings were $10,731,000 for the 2023 fiscal year compared to $8,464,000 for the 2022 fiscal year.
Net earnings before special items for the 2023 fiscal year fourth quarter were $1,976,000 compared to $2,018,000 for the 2022 fiscal year fourth quarter and $2,383,000 for the 2023 fiscal year third quarter. Net earnings before special items for the fiscal year ended February 26, 2023 were $8,154,000 compared to $8,723,000 for the 2022 fiscal year.
Adjusted EBITDA for the 2023 fiscal year fourth quarter was $2,625,000 compared to $3,083,000 for the 2022 fiscal year fourth quarter and $3,321,000 for the 2023 fiscal year third quarter. Adjusted EBITDA for the 2023 fiscal year was $11,459,000 compared to $13,089,000 for the 2022 fiscal year.
The Company recognized a tax benefit of $2,791,000 in the 2023 fiscal year fourth quarter and fiscal year 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 and $214,000 of additional tax expense for tax deductions becoming unavailable related to stock options expiring unexercised in the 2023 fiscal year fourth quarter and fiscal year, respectively. During the prior year, the Company recorded restructuring charges of $62,000 in the 2022 fiscal year fourth quarter and $259,000 in the 2022 fiscal year, primarily for the costs in connection with exiting the Park Aerospace Technologies Asia Pte. Ltd idle facility in Singapore.
Park reported basic and diluted earnings per share of $0.23 for the 2023 fiscal year fourth quarter compared to $0.10 for the 2022 fiscal year fourth quarter and $0.11 for the 2023 fiscal year third quarter. Basic and diluted earnings per share before special items were $0.10 for the 2023 fiscal year fourth quarter compared to $0.10 for the 2022 fiscal year fourth quarter and $0.12 for the 2023 fiscal year third quarter.
Park reported basic and diluted earnings per share of $0.52 for the 2023 fiscal year compared to $0.41 for the 2022 fiscal year. Basic and diluted earnings per share before special items were $0.40 for the 2023 fiscal year compared to basic earnings per share before special items of $0.43 for the 2022 fiscal year and diluted earnings per share before special items of $0.42 for the 2022 fiscal year.
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 13738134.
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, May 25, 2023. The conference call replay will be available at https://edge.media-server.com/mmc/p/ssv8op68 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 13738134.
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 reduction in uncertain tax positions, tax deductions becoming unavailable and restructuring charges. 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 website at www.parkaerospace.com
Performance table, including non-GAAP information (in thousands, except per share amounts –unaudited):
13 Weeks Ended
52 Weeks Ended
February 26, 2023
February 27, 2022
November 27, 2022
February 26, 2023
February 27, 2022
Sales
$
13,530
$
12,502
$
13,867
$
54,055
$
53,578
Net Earnings before Special Items1
$
1,976
$
2,018
$
2,383
$
8,154
$
8,723
Special Items, Net of Tax:
Tax Impact of Cancelled Stock Options
(61
)
-
(153
)
(214
)
-
Reduction in Uncertain Tax Positions
2,791
-
-
2,791
-
Restructuring Charges
-
(62
)
-
-
(259
)
Net Earnings
$
4,706
$
1,956
$
2,230
$
10,731
$
8,464
Basic Earnings per Share:
Basic Earnings before Special Items1
$
0.10
$
0.10
$
0.12
$
0.40
$
0.43
Special Items:
Tax Impact of Cancelled Stock Options
-
-
(0.01
)
(0.01
)
-
Reduction in Uncertain Tax Positions
0.13
-
-
0.13
-
Restructuring Charges
-
-
-
-
(0.02
)
Basic Earnings per Share
$
0.23
$
0.10
$
0.11
$
0.52
$
0.41
Diluted Earnings before Special Items1
$
0.10
$
0.10
$
0.12
$
0.40
$
0.42
Special Items:
Tax Impact of Cancelled Stock Options
-
-
(0.01
)
(0.01
)
-
Reduction in Uncertain Tax Positions
0.13
-
-
0.13
-
Restructuring Charges
-
-
-
-
(0.01
)
Diluted Earnings per Share
$
0.23
$
0.10
$
0.11
$
0.52
$
0.41
Weighted Average Shares Outstanding:
Basic
20,471
20,458
20,471
20,465
20,422
Diluted
20,518
20,508
20,510
20,509
20,551
1 Refer to "Reconciliation of non-GAAP financial measures" below for information regarding Special Items.
Comparative balance sheets (in thousands):
February 26, 2023
February 27, 2022
Assets
(unaudited)
Current Assets
Cash and Marketable Securities
$
105,440
$
110,361
Accounts Receivable, Net
9,989
8,339
Inventories
6,768
4,657
Prepaid Expenses and Other Current Assets
2,844
3,082
Total Current Assets
125,041
126,439
Fixed Assets, Net
24,251
24,333
Operating Right-of-use Assets
150
203
Other Assets
9,891
9,912
Total Assets
$
159,333
$
160,887
Liabilities and Shareholders' Equity
Current Liabilities
Accounts Payable
$
4,545
$
2,534
Accrued Liabilities
1,346
1,494
Dividend Payable
20,471
-
Operating Lease Liability
53
53
Income Taxes Payable
2,171
2,211
Total Current Liabilities
28,586
6,292
Long-term Operating Lease Liability
129
174
Non-current Income Taxes Payable
10,938
12,621
Deferred Income Taxes
1,995
1,671
Other Liabilities
1,751
4,497
Total Liabilities
43,399
25,255
Shareholders’ Equity
115,934
135,632
Total Liabilities and Shareholders' Equity
$
159,333
$
160,887
Additional information
Equity per Share
$
5.66
$
6.63
Comparative statements of operations (in thousands – unaudited):
13 Weeks Ended
52 Weeks Ended
February 26, 2023
February 27, 2022
November 27, 2022
February 26, 2023
February 27, 2022
Net Sales
$
13,530
$
12,502
$
13,867
$
54,055
$
53,578
Cost of Sales
9,679
8,304
9,423
37,582
35,661
Gross Profit
3,851
4,198
4,444
16,473
17,917
% of net sales
28.5%
33.6%
32.0%
30.5%
33.4%
Selling, General & Administrative Expenses
1,631
1,520
1,523
6,519
6,249
% of net sales
12.1%
12.2%
11.0%
12.1%
11.7%
Restructuring Charges
-
62
-
-
259
% of net sales
0.0%
0.5%
0.0%
0.0%
0.5%
Earnings from Operations
2,220
2,616
2,921
9,954
11,409
Interest and Other Income:
Interest Income
425
89
299
1,078
375
Earnings from Operations before Income Taxes
2,645
2,705
3,220
11,032
11,784
Income Tax (Benefit) Provision
(2,061
)
749
990
301
3,320
Net Earnings
$
4,706
$
1,956
$
2,230
$
10,731
$
8,464
% of net sales
34.8%
15.6%
16.1%
19.9%
15.8%
Reconciliation of non-GAAP financial measures (in thousands – unaudited):
13 Weeks Ended February 26, 2023
13 Weeks Ended February 27, 2022
13 Weeks Ended November 27, 2022
GAAP
Specials Items
Before Special Items
GAAP
Specials Items
Before Special Items
GAAP
Specials Items
Before Special Items
Restructuring Charges
-
-
-
62
(62
)
-
-
-
-
% of net sales
0.0%
0.0%
0.5%
0.0%
0.0%
0.0%
Earnings from Operations
2,220
-
2,220
2,616
62
2,678
2,921
-
2,921
% of net sales
16.4%
16.4%
20.9%
21.4%
21.1%
21.1%
Interest Income
425
-
425
89
-
89
299
-
299
% of net sales
3.1%
3.1%
0.7%
0.7%
2.2%
2.2%
Earnings from Operations before Income Taxes
2,645
-
2,645
2,705
62
2,767
3,220
-
3,220
% of net sales
19.5%
19.5%
21.6%
22.1%
23.2%
23.2%
Income Tax (Benefit) Provision
(2,061
)
2,730
669
749
-
749
990
(153
)
837
Effective Tax Rate
-77.9
%
25.3%
27.7%
27.1%
30.7%
26.0%
Net Earnings
4,706
(2,730
)
1,976
1,956
62
2,018
2,230
153
2,383
% of net sales
34.8%
14.6%
15.6%
16.1%
16.1%
17.2%
Net Earnings Before Special Items
1,976
2,018
2,383
Addback non-cash expenses:
Income Tax Provision
669
749
837
Interest Income
(425
)
(89
)
(299
)
Depreciation
310
331
305
Stock Option Expense
95
74
95
Adjusted EBITDA
2,625
3,083
3,321
Reconciliation of non-GAAP financial measures - continued (in thousands – unaudited):
52 Weeks Ended February 26, 2023
52 Weeks Ended February 27, 2022
GAAP
Specials Items
Before Special Items
GAAP
Specials Items
Before Special Items
Restructuring Charge
-
-
-
259
(259
)
-
% of net sales
0.0%
0.0%
0.5%
0.0%
Earnings from Operations
9,954
-
9,954
11,409
259
11,668
% of net sales
18.4%
18.4%
21.3%
21.8%
Interest Income
1,078
-
1,078
375
-
375
% of net sales
2.0%
2.0%
0.7%
0.7%
Earnings from Operations before Income Taxes
11,032
-
11,032
11,784
259
12,043
% of net sales
20.4%
20.4%
22.0%
22.5%
Income Tax Provision
301
2,577
2,878
3,320
-
3,320
Effective Tax Rate
2.7%
26.1%
28.2%
27.6%
Net Earnings
10,731
(2,577
)
8,154
8,464
259
8,723
% of net sales
19.9%
15.1%
15.8%
16.3%
Net Earnings Before Special Items
8,154
8,723
Addback non-cash expenses:
Income Tax Provision
2,878
3,320
Interest Income
(1,078
)
(375
)
Depreciation
1,136
1,136
Stock Option Expense
369
285
Adjusted EBITDA
11,459
13,089
Contact: Donna D’Amico-Annitto 486 North Oliver Road, Bldg. Z Newton, Kansas 67114 (316) 283-6500
Park Aerospace Corp. is an aerospace company. The Company develops and manufactures solutions and hot-melt advanced composite materials used to produce composite structures for the global aerospace markets. Its advanced composite materials include film adhesives and lightning strike protection materials. It offers an array of composite materials specifically designed for hand lay-up or automated fiber placement (AFP) manufacturing applications. Its advanced composite materials are used to produce primary and secondary structures for jet engines, large and regional transport aircraft, military aircraft, Unmanned Aerial Vehicles, business jets, general aviation aircraft and rotary wing aircraft. The Company is a distributor of RAYCARB C2B NG, which is used to produce ablative composite materials for critical rocketry and missile systems. The Company also offers specialty ablative materials for rocket motors and nozzles and specially designed materials for radome applications.