Park Electrochemical Corp. Reports Second Quarter Results

MELVILLE, N.Y.--(BUSINESS WIRE)--Park Electrochemical Corp. (NYSE-PKE) reported sales of $50,449,000 for its 2012 fiscal year second quarter ended August 28, 2011 compared to sales of $54,505,000 for last fiscal year’s second quarter ended August 29, 2010. Park’s sales for the first six months ended August 28, 2011 were $102,266,000 compared to sales of $113,531,000 for last fiscal year’s first six months ended August 29, 2010.

Park reported net earnings before special items of $6,615,000 for the second quarter ended August 28, 2011 compared to net earnings of $9,447,000 for last fiscal year’s second quarter. During the current fiscal year’s second quarter, the Company recorded other pre-tax income of $1,598,000 relating to the settlement of certain lawsuits during the quarter. Accordingly, net earnings were $7,670,000 for the second quarter ended August 28, 2011. Park recorded no special items during last fiscal year’s second quarter.

For the six-month period ended August 28, 2011, Park reported net earnings before special items of $13,857,000 compared to net earnings of $19,316,000 for last fiscal year’s first six-month period ended August 29, 2010. The current fiscal year’s six-month period included other pre-tax income of $1,598,000 relating to the settlement of certain lawsuits mentioned above. Accordingly, net earnings were $14,912,000 for the six-month period ended August 28, 2011. Park recorded no special items during the six-month period ended August 29, 2010.

Park reported basic and diluted earnings per share before special items of $0.32 for the second quarter ended August 28, 2011 and $0.67 for the six-month period ended August 28, 2011 compared to basic and diluted earnings per share of $0.46 and $0.94 for last year’s second quarter and six-month period, respectively. Basic and diluted earnings per share were $0.37 and $0.72 for the second quarter and six-months ended August 28, 2011, respectively. The effective tax rate before special items for the second quarter ended August 28, 2011 was 15.5% compared to an effective tax rate of 16.4% for last year’s second quarter. The effective tax rate for the second quarter ended August 28, 2011 was 18.6%.

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 [phone] in the United States and Canada and [phone] in other countries and the required passcode is 43577930.

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 Monday, October 3, 2011. The conference call replay can be accessed by dialing [phone] in the United States and Canada and [phone] in other countries and entering passcode 44682938 and will be available 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 the settlement of lawsuits. Accordingly, in addition to disclosing its financial results determined in accordance with GAAP, Park disclosed 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 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, China, France, Connecticut, Kansas, Arizona, California and Washington.

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

The performance table (in thousands, except per share amounts–unaudited):

	13 Weeks Ended				26 Weeks Ended
	8/28/11		8/29/10		8/28/11		8/29/10
Sales	$	50,449	$	54,505	$	102,266	$	113,531
Net Earnings before Special Items	$	6,615	$	9,447	$	13,857	$	19,316
Special Items net of Tax	$	1,055	$	-	$	1,055	$	-
Net Earnings	$	7,670	$	9,447	$	14,912	$	19,316
Basic and Diluted Earnings per Share:
Basic and Diluted Earnings before Special Items	$	0.32	$	0.46	$	0.67	$	0.94
Special Items	$	0.05	$	-	$	0.05	$	-
Basic and Diluted Earnings per Share	$	0.37	$	0.46	$	0.72	$	0.94
Weighted Average Shares Outstanding:
Basic		20,741		20,632		20,732		20,596
Diluted		20,776		20,642		20,798		20,625

The comparative balance sheets (in thousands):

	8/28/11		2/27/11
Assets	(unaudited)
Current Assets
Cash and Marketable Securities	$	257,670	$	250,444
Accounts Receivable, Net		28,000		29,822
Inventories		14,808		12,888
Other Current Assets		4,819		3,805
Total Current Assets		305,297		296,959
Fixed Assets, Net		41,105		41,292
Other Assets		16,977		15,557
Total Assets	$	363,379	$	353,808
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable	$	8,602	$	9,944
Accrued Liabilities		9,456		9,497
Income Taxes Payable		4,618		5,812
Total Current Liabilities		22,676		25,253
Deferred Income Taxes		1,460		1,460
Other Liabilities		1,548		1,787
Total Liabilities		25,684		28,500
Stockholders’ Equity		337,695		325,308
Total Liabilities and Stockholders' Equity	$	363,379	$	353,808
Equity per Share	$	16.27	$	15.70

Detailed operating information (in thousands – unaudited):

	13 Weeks Ended						26 Weeks Ended
	8/28/11			8/29/10			8/28/11			8/29/10
Net Sales	$	50,449		$	54,505		$	102,266		$	113,531
Cost of Sales		35,913			36,188			71,761			75,051
%		71.2	%		66.4	%		70.2	%		66.1	%
Gross Profit		14,536			18,317			30,505			38,480
%		28.8	%		33.6	%		29.8	%		33.9	%
Selling, General and Administrative
Expenses		6,902			7,238			14,452			15,000
%		13.7	%		13.3	%		14.1	%		13.2	%
Earnings from Operations		7,634			11,079			16,053			23,480
%		15.1	%		20.3	%		15.7	%		20.7	%
Other Income		196			218			417			294
%		0.4	%		0.4	%		0.4	%		0.2	%
Earnings before Income Taxes		7,830			11,297			16,470			23,774
%		15.5	%		20.7	%		16.1	%		20.9	%
Income Tax Provision		1,215			1,850			2,613			4,458
Effective Tax Rate		15.5	%		16.4	%		15.9	%		18.8	%
Net Earnings before Special Items		6,615			9,447			13,857			19,316
%		13.1	%		17.3	%		13.5	%		17.0	%
Special Items:
Settlement of Certain Lawsuits		1,598			-			1,598			-
%		3.2	%		0	%		1.6	%		0	%
Income Tax Provision		543			-			543			-
Effective Tax Rate		6.9	%		0	%		3.3	%		0	%
After Special Items:
Earnings before Income Taxes		9,428			11,297			18,068			23,774
%		18.7	%		20.7	%		17.7	%		20.9	%
Income Tax Provision		1,758			1,850			3,156			4,458
Effective Tax Rate		18.6	%		16.4	%		17.5	%		18.8	%
Net Earnings		7,670			9,447			14,912			19,316
%		15.2	%		17.3	%		14.6	%		17.0	%