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Park Electrochemical Corp. (PKE)’s Q3 FY 2015 Earnings Conference Call Transcript

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Below is transcript of the Park Electrochemical Corp. (NYSE:PKE)’s Q3 FY 2015 Earnings Conference Call, held on Thursday, January 08, 2015, at 11:00 am EST. Royce & Associates, Bryn Mawr Capital and Gamco Investors was among Park Electrochemical Corp. (NYSE:PKEshareholders at the end of the second quarter.

 

PKE Park

 

Park Electrochemical Corp. (NYSE:PKE) through its subsidiaries, is a global advanced materials company, which develops, manufactures, markets and sells high-technology digital and radio frequency (RF)/microwave printed circuit materials products principally for the telecommunications and Internet infrastructure and high-end computing markets and advanced composite materials, parts and assemblies products principally for the aerospace markets.

 

Host:
Brian Shore, Chairman and Chief Executive Officer, Park Electrochemical Corp.

 

Company Representative:
Matt Farabaugh, Vice President and CFO.

 

Analyst:
Sean Hannan – Needham and Company
Morris Ajzenman – Griffin Securities
Lenard Cooper – Private Investor.

 

Operator
Good morning, my name is Simeon and I’ll be your conference operator today. At this time, I’d like to welcome everyone to the Park Electrochemical Corp. Third Quarter Fiscal Year 2015 earnings release conference call. All lines have been placed on mute to prevent any background noise. After the speakers remarks there will be a question and answer session. If you would like to ask a question during this time, simply press star then the number one key on your touch tone telephone. If you’d like to withdraw your question, please press the pound key. At this time I’d like to turn the call over to Mr. Brian Shore, Chairman and Chief Executive Officer. Mr. Shore, you may begin your conference.

 

Brian Shore, Chairman and Chief Executive Officer, Park Electrochemical Corp.
Thank you operator. Good morning this is Brian Shore, Happy New Year everybody! I have with me, Matt Farabaugh, Vice President and CFO as usual, and we’ll begin our 3rd quarter conference call with our introductory remarks and we’ll go to questions. When we get started Matt.

 

Matt Farabaugh, Vice President and CFO
Certain statements we may make during the course of this discussion which do not relate to historical financial information may be deemed to constitute forward-looking statements. Any forward-looking statements are subject to various factors that could cause actual results to differ materially from our expectations. We have set forth in our most recent Annual Report on Form 10-K for the fiscal year ended March 2, 2014 various factors that could affect future results. Those factors are found in Item 1A and after Item 7 of that Form 10-K. Any forward-looking statements we may make are subject to those factors.
I’d like to briefly review some of the items in our third quarter ended November 30, 2014 P&L, which are not specifically addressed in the earnings release.

During the fiscal year 2015 third quarter, North American sales were 50% of total sales, European sales were 9% of total sales and Asian sales were 41% of total sales, compared to 51%, 6% and 43%, respectively, for the third quarter of the 2014 fiscal year and 46%, 6% and 48%, respectively, for the 2015 fiscal year second quarter.

Sales of Park’s high performance (non-FR-4) printed circuit materials were 92% of total laminate and prepreg material sales in the third quarter of fiscal year 2015, 89% in the third quarter of the 2014 fiscal year and 92% in the 2015 fiscal year second quarter.
Sales of Park’s electronics materials were $25.4 million, or 73% of total sales, in the third quarter of the 2015 fiscal year compared to $31.5 million, or 79% of total sales, in the third quarter of the 2014 fiscal year and compared to $33.7 million, or 80% of total sales, in the 2015 fiscal year second quarter. Sales of Park’s aerospace materials and parts were $9.3 million, or 27% of total sales, in the third quarter of the 2015 fiscal year compared to $8.2 million, or 21% of total sales, in the third quarter of the 2014 fiscal year and compared to $8.6 million, or 20% of total sales, in the 2015 fiscal year second quarter.

Investment income, net of interest expense, for the third quarter of the 2015 fiscal year was negative $139,000 compared to negative $48,000 in the third quarter of the 2014 fiscal year and negative $134,000 in the 2015 fiscal year second quarter.
Depreciation and amortization expense for the third quarter of the 2015 fiscal year was $890,000 compared to $1,012,000 in the 2014 fiscal year third quarter and $865,000 in the 2015 fiscal year second quarter. Capital expenditures for the third quarter of the 2015 fiscal year were $148,000 compared to $161,000 in the 2014 fiscal year third quarter and $179,000 in the 2015 fiscal year second quarter.

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