MELVILLE, N.Y., May 07, 2018 (GLOBE NEWSWIRE) -- Park Electrochemical Corp. (NYSE:PKE) reported net sales of $27,804,000 for the 2018 fiscal year’s fourth quarter ended February 25, 2018 compared to net sales of $27,599,000 for the 2017 fiscal year’s fourth quarter ended February 26, 2017 and net sales of $26,139,000 for the 2018 fiscal year’s third quarter ended November 26, 2017. Park’s net sales for the fiscal year ended February 25, 2018 were $111,196,000 compared to net sales of $114,609,000 for the fiscal year ended February 26, 2017. 

Net earnings for the 2018 fiscal year’s fourth quarter were $17,965,000 compared to $2,477,000 for the 2017 fiscal year’s fourth quarter and $716,000 for the 2018 fiscal year’s third quarter.  Net earnings were $20,595,000 for the fiscal year ended February 25, 2018 compared to $9,283,000 for the fiscal year ended February 26, 2017.

Park reported net earnings before special items of $1,972,000 for the 2018 fiscal year’s fourth quarter compared to net earnings before special items of $2,548,000 for the 2017 fiscal year’s fourth quarter and net earnings before special items of $1,131,000 for the 2018 fiscal year’s third quarter.

In the 2018 fiscal year’s fourth quarter, the Company recorded a one-time tax benefit of $17,802,000 related to the Tax Cuts and Jobs Act enacted in December 2017. Additionally, in the 2018 fiscal year’s fourth quarter, the Company recorded pre-tax restructuring charges of $287,000, a pre-tax loss on the sales of marketable securities of $1,342,000, pre-tax deferred financing costs of $144,000 related to the early termination of the HSBC Bank Credit Agreement, a pre-tax stock option modification charge of $513,000 and pre-tax advisory fees of $162,000. The restructuring charges are related to the consolidation of the Company’s electronics business units in California and Arizona, the closure, in fiscal year 2009, of its facility located in Newburgh, New York and the closure of its facility in Waterbury, Connecticut. The loss on the sales of marketable securities was in connection with the liquidation of securities to repatriate overseas funds to pay off the HSBC loan of $68,500,000 and pay a special cash dividend of $3.00 per share in February 2018. The stock option modification charge related to a modification of previously granted employee stock options resulting from the special dividend paid in February 2018. The advisory fees pertained to the strategic evaluation of the Company’s electronics business announced in January 2018.

In the 2017 fiscal year’s fourth quarter, the Company recorded pre-tax restructuring charges of $107,000 in connection with the aforementioned Newburgh, New York facility closure.  In the 2018 fiscal year’s third quarter, the Company recorded pre-tax restructuring charges of $472,000 related to the consolidation of its electronics business units located in California and Arizona and the closure, in fiscal year 2009, of its facility located in Newburgh, New York and advisory fees related to the strategic evaluation of the Company’s electronics business of $190,000 included in selling, general and administrative expenses.

For the fiscal year ended February 25, 2018, Park reported net earnings before special items of $7,930,000 compared to net earnings before special items of $9,480,000 for the prior fiscal year. In the 2018 fiscal year, the Company recorded the one-time tax benefit of $17,802,000 mentioned above and recorded pre-tax restructuring charges of $5,022,000 related to the consolidation of electronics business units and facility closures mentioned above, a pre-tax loss on the sales of marketable securities of $1,342,000, pre-tax deferred financing costs of $144,000, a pre-tax stock option modification charge of $513,000, all mentioned above, pre-tax advisory fees of $352,000 related to the strategic evaluation of the Company’s electronics business and a pre-tax one-time litigation expense of $375,000. The 2017 fiscal year included pre-tax restructuring charges of $313,000 related to the facility closures mentioned above.

Park reported basic earnings per share of $0.89 and diluted earnings per share of $0.88 for the 2018 fiscal year’s fourth quarter compared basic and diluted earnings per share to $0.12 for the 2017 fiscal year’s fourth quarter and $0.04 for the 2018 fiscal year’s third quarter. Basic and diluted earnings per share before special items were $0.10 for the 2018 fiscal year’s fourth quarter compared to $0.13 for the 2017 fiscal year’s fourth quarter and $0.06 for the 2018 fiscal year’s third quarter. 

Park reported basic and diluted earnings per share of $1.02 for the 2018 fiscal year compared to $0.46 for the 2017 fiscal year, and basic and diluted earnings per share before special items of $0.39 for the 2018 fiscal year compared to $0.47 for the 2017 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 (844) 466-4114 in the United States and Canada and (765) 507-2654 in other countries and the required passcode is 2474705.

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 Sunday, May 13, 2018.  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 2474705 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 operating 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, losses on sales of marketable securities, deferred financing charges, stock option modification charges, pre-tax litigation expenses and strategic evaluation advisory fees. Accordingly, in addition to disclosing its operating 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 advanced composite materials, primary and secondary structures and assemblies and low-volume tooling for the aerospace markets and high-technology digital and RF/microwave printed circuit materials principally for the telecommunications and internet infrastructure, enterprise and military/aerospace markets.  The Company’s manufacturing facilities are located in Kansas, Singapore, France, 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 52 Weeks Ended
       
 February 25,
2018		  February 26,
2017		  November 26,
2017		 February 25,
2018		  February 26,
2017
Sales$27,804   $27,599   $26,139  $111,196   $114,609 
             
Net Earnings before Special Items1$1,972   $2,548   $1,131  $7,930   $9,480 
Special Items, net of Tax:            
One-time Litigation Expense -    -    -   (236)   - 
Strategic Evaluation Advisory Fees (102)   -    (119)  (221)   - 
Stock Option Modification (322)   -    -   (322)   - 
Restructuring Charges (180)   (71)   (296)  (3,153)   (197)
Loss on Sale of Marketable Securities (1,114)   -    -   (1,114)   - 
Acceleration of Deferred Financing Costs (91)   -    -   (91)   - 
Tax Cut and Jobs Act 17,802    -    -   17,802    - 
Net Earnings$17,965   $2,477   $716  $20,595   $9,283 
             
Basic and Diluted Earnings per Share:            
Basic Earnings before Special Items1$0.10   $0.13   $0.06  $0.39   $0.47 
Special Items:            
One-time Litigation Expense -    -    -   (0.01)   - 
Strategic Evaluation Advisory Fees (0.01)   -    (0.01)  (0.01)   - 
Stock Option Modification (0.02)   -    -   (0.02)   - 
Restructuring Charges (0.01)   (0.01)   (0.01)  (0.16)   (0.01)
Loss on Sale of Marketable Securities (0.05)   -    -   (0.05)   - 
Acceleration of Deferred Financing Costs -    -    -   -    - 
Tax Cut and Jobs Act 0.88    -    -   0.88    - 
Basic Earnings (Loss) per Share$0.89   $0.12   $0.04  $1.02   $0.46 
             
Diluted Earnings before Special Items1$0.10   $0.13   $0.06  $0.39   $0.47 
Special Items:            
One-time Litigation Expense -    -    -   (0.01)   - 
Strategic Evaluation Advisory Fees (0.01)   -    (0.01)  (0.01)   - 
Stock Option Modification (0.02)   -    -   (0.02)   - 
Restructuring Charges (0.02)   (0.01)   (0.01)  (0.16)   (0.01)
Loss on Sale of Marketable Securities (0.05)   -    -   (0.05)   - 
Acceleration of Deferred Financing Costs -    -    -   -    - 
Tax Cut and Jobs Act 0.88    -    -   0.88    - 
Diluted Earnings (Loss) per Share$0.88   $0.12   $0.04  $1.02   $0.46 
             
Weighted Average Shares Outstanding:            
Basic 20,238    20,235    20,237   20,237    20,235 
Diluted 20,311    20,253    20,261   20,267    20,239 
           
1 Refer to "Reconciliation of non-GAAP financial measures" below for information regarding Special Items. 

Comparative balance sheets (in thousands):  

 
 February 25,
2018		 February 26,
2017		 
Assets(unaudited)   
Current Assets    
Cash and Marketable Securities$108,231 $238,590 
Accounts Receivable, Net 19,762  17,238 
Inventories 11,156  11,105 
Prepaid Expenses and Other Current Assets 2,119  2,197 
Total Current Assets 141,268  269,130 
     
Fixed Assets, Net 16,532  18,638 
Restricted Cash -  10,000 
Other Assets 11,223  10,810 
Total Assets$169,023 $308,578 
     
Liabilities and Shareholders' Equity    
Current Liabilities    
Current Portion of Long-Term Debt$- $3,500 
Accounts Payable 4,025  4,183 
Accrued Liabilities 5,381  3,417 
Income Taxes Payable 2,821  3,023 
Total Current Liabilities 12,227  14,123 
     
Long-Term Debt -  68,500 
Noncurrent Income Taxes Payable 20,364  - 
Deferred Income Taxes 628  42,088 
Other Liabilities 543  1,041 
Total Liabilities 33,762  125,752 
     
Shareholders’ Equity 135,261  182,826 
     
Total Liabilities and Shareholders' Equity$169,023 $308,578 
     
Additional information    
Equity per Share$   6.68  $   9.04  
Total Cash, Restricted Cash and Marketable Securities$   108,231 *$  248,590  
 
* There was no restricted cash for fiscal year ended February 25, 2018.  

Comparative statements of operations (in thousands – unaudited):

              
 13 Weeks Ended  52 Weeks Ended
              
 February 25,
2018		  February 26,
2017		  November 26,
2017		  February 25,
2018		  February 26,
2017
              
Net Sales$27,804   $27,599   $26,139   $111,196   $114,609 
              
Cost of Sales 20,914    20,213    20,069    84,737    84,568 
              
Gross Profit 6,890    7,386    6,070    26,459    30,041 
% of net sales 24.8%   26.8%   23.2%   23.8%   26.2%
              
Selling, General & Administrative Expenses 5,404    4,688    4,797    19,371    19,739 
% of net sales 19.4%   17.0%   18.4%   17.4%   17.2%
              
Restructuring Charges 287    107    472    5,022    313 
              
Earnings from Operations 1,199    2,591    801    2,066    9,989 
              
Interest:             
Interest Income 441    527    734    2,675    1,704 
              
Loss on Sale of Marketable Securities (1,342)   -    -    (1,342)   - 
              
Interest Expense 467    422    689    2,269    1,432 
              
Net Interest and Other (Expense)/Income (1,368)   105    45    (936)   272 
              
(Loss)/Earnings before Income Taxes (169)   2,696    846    1,130    10,261 
              
Income Tax (Benefit)/Provision (18,134)   219    130    (19,465)   978 
              
Net Earnings$17,965   $2,477   $716   $20,595   $9,283 
              

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

                    
 13 Weeks Ended
February 25, 2018		  13 Weeks Ended
February 26, 2017		  13 Weeks Ended
November 26, 2017
 GAAP Specials
Items		 Before
Special
Items		  GAAP Specials
Items		 Before
Special
Items		  GAAP Specials
Items		 Before
Special
Items
                    
Selling, General & Administrative Expenses$5,404  $(675) $4,729   $4,688  $-  $4,688   $4,797  $(190) $4,607 
% of net sales 19.4%    17.0%   17.0%    17.0%   18.4%    17.6%
                    
Restructuring Charges 287   (287)  -    107   (107)  -    472   (472)  - 
% of net sales 1.0%    0.0%   0.4%    0.0%   1.8%    0.0%
                    
Earnings from Operations 1,199   962   2,161    2,591   107   2,698    801   662   1,463 
% of net sales 4.3%    7.8%   9.4%    9.8%   3.1%    5.6%
                    
Interest Income 441   -   441    527   -   527    734   -   734 
% of net sales 1.6%    1.6%   1.9%    1.9%   2.8%    2.8%
                    
Loss on Sale of Marketable Securities (1,342)  1,342   -    -     -    -   -   - 
% of net sales -4.8%    0.0%   0.0%    0.0%   0.0%    0.0%
                    
Interest Expense 467   (144)  323    422   -   422    689   -   689 
% of net sales 1.7%    1.2%   1.5%    1.5%   2.6%    2.6%
                    
Net Interest and Other (Expense)/Income (1,368)  1,486   118    105   -   105    45   -   45 
% of net sales -4.9%    0.4%   0.4%    0.4%   0.2%    0.2%
                    
(Loss)/Earnings before Income Taxes (169)  2,448   2,279    2,696   107   2,803    846   662   1,508 
% of net sales -0.6%    8.2%   9.8%    10.2%   3.2%    5.8%
                    
Income Tax (Benefit)/Provision (18,134)  18,441   307    219   36   255    130   247   377 
Effective Tax Rate 10730.2%    13.5%   8.1%    9.1%   15.4%    25.0%
                    
Net Earnings 17,965   (15,993)  1,972    2,477   71   2,548    716   415   1,131 
% of net sales 64.6%    7.1%   9.0%    9.2%   2.7%    4.3%
                    


             
 52 Weeks Ended
February 25, 2018		  52 Weeks Ended
February 26, 2017
 GAAP Specials
Items		 Before
Special
Items		  GAAP Specials
Items		 Before
Special
Items
Selling, General & Administrative Expenses$19,371  $(1,240) $18,131   $19,739  $-  $19,739 
% of net sales 17.4%    16.3%   17.2%    17.2%
             
Restructuring Charge 5,022   (5,022)  -    313   (313)  - 
% of net sales 4.5%    0.0%   0.3%    0.0%
             
Earnings from Operations 2,066   6,262   8,328    9,989   313   10,302 
% of net sales 1.9%    7.5%   8.7%    9.0%
             
Interest Income 2,675     2,675    1,704   -   1,704 
% of net sales 2.4%    2.4%   1.5%    1.5%
             
Loss on Sale of Marketable Securities (1,342)  1,342   -    -   -   - 
% of net sales -1.2%    0.0%   0.0%    0.0%
             
Interest Expense 2,269   (144)  2,125    1,432   -   1,432 
% of net sales 2.0%    1.9%   1.2%    1.2%
             
Net Interest and Other (Expense)/Income (936)  1,486   550    272   -   272 
% of net sales -0.8%    0.5%   0.2%    0.2%
             
Earnings before Income Taxes 1,130   7,748   8,878    10,261   313   10,574 
% of net sales 1.0%    8.0%   9.0%    9.2%
             
Income Tax (Benefit)/Provision (19,465)  20,413   948    978   116   1,094 
Effective Tax Rate -1722.6%    10.7%   9.5%    10.3%
             
Net Earnings 20,595   (12,665)  7,930    9,283   197   9,480 
% of net sales 18.5%    7.1%   8.1%    8.3%
             

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


 

 


 

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