-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, k3rWEg+F5lXsirGqA/u6bO1ZcaFLUyR2cHxlr9NtyiDisOuStUNrtveDjNSuwuN2 6onm2+KYWOWEvdONztFvrg== 0000076267-94-000022.txt : 19941024 0000076267-94-000022.hdr.sgml : 19941024 ACCESSION NUMBER: 0000076267-94-000022 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940828 FILED AS OF DATE: 19941011 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PARK ELECTROCHEMICAL CORP CENTRAL INDEX KEY: 0000076267 STANDARD INDUSTRIAL CLASSIFICATION: 3672 IRS NUMBER: 111734643 STATE OF INCORPORATION: NY FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04415 FILM NUMBER: 94552336 BUSINESS ADDRESS: STREET 1: 5 DAKOTA DR CITY: LAKE SUCCESS STATE: NY ZIP: 11042 BUSINESS PHONE: 5163544100 MAIL ADDRESS: STREET 2: 5 DAKOTA DRIVE CITY: LAKE SUCCESS STATE: NY ZIP: 11042 10-Q 1 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 F O R M 10-Q (Mark One) [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 28, 1994 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________________ to ___________________ Commission file number 1-4415 PARK ELECTROCHEMICAL CORP. ---------------------------------------------------------- (Exact name of registrant as specified in its charter) New York 11-1734643 - - ------------------------------- -------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 5 Dakota Drive, Lake Success, N.Y. 11042 - - ------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (516) 354-4100 Not Applicable ----------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS: Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes [ ] No [ ] APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 5,685,082 as of September 30, 1994. 2 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES I N D E X Page Number PART I. FINANCIAL INFORMATION: Item 1. Financial Statements Condensed Consolidated Balance Sheets August 28, 1994 (Unaudited) and February 27, 1994 ............................. 3 Consolidated Statements of Earnings 13 weeks and 26 weeks ended August 28, 1994 and August 29, 1993 (Unaudited)................ 4 Consolidated Statements of Cash Flows 26 weeks ended August 28, 1994 and August 29, 1993 (Unaudited)............................... 5 Notes to Condensed Consolidated Financial Statements (Unaudited) ....................... 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations ................................... 8 PART II. OTHER INFORMATION: Item 1. Legal Proceedings .............................. 10 Item 4. Submission of Matters to a Vote of Security Holders......................................... 10 Item 6. Exhibits and Reports on Form 8-K ............... 10 SIGNATURES ................................................. 11 -2- 3 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)
August 28, February 27, 1994 1994 ASSETS (Unaudited) * Cash and cash equivalents $ 22,370 $ 14,135 Marketable securities 17,944 23,918 Accounts receivable, net 27,904 28,904 Inventories (Note 2) 18,037 16,144 Prepaid expenses & other current assets 3,713 2,738 -------- ------- TOTAL CURRENT ASSETS 89,968 85,839 Property, plant and equipment, net 55,267 51,398 Other assets (Note 3) 2,228 3,513 -------- -------- $147,463 $140,750 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Bank loans payable $ - $ 78 Accounts payable 24,495 24,443 Accrued liabilities 12,046 12,487 Income taxes payable 2,547 2,964 -------- -------- TOTAL CURRENT LIABILITIES 39,088 39,972 Long-term debt (Note 3) 9 32,861 Deferred income taxes 4,716 4,772 Deferred pension liability 1,691 1,691 Stockholders' Equity: (Note 3) Common stock 679 520 Other stockholders' equity 101,280 60,934 -------- -------- TOTAL STOCKHOLDERS' EQUITY 101,959 61,454 -------- -------- $147,463 $140,750 ======== ======== *The Balance Sheet at February 27, 1994 has been taken from the audited financial statements at that date, and condensed.
-3- 4 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited - in thousands, except per share data)
13 weeks ended 26 weeks ended August 28, August 29, August 28, August 29, 1994 1993 1994 1993 Net sales $58,795 $47,318 $121,564 $ 96,547 -------- -------- --------- --------- Costs and expenses: Cost of sales 46,275 38,416 95,797 79,614 Selling, general and administrative 6,941 6,193 14,412 12,474 -------- -------- --------- --------- Total costs and expenses 53,216 44,609 110,209 92,088 -------- -------- --------- --------- Operating profit 5,579 2,709 11,355 4,459 -------- -------- --------- --------- Other income (expense): Interest expense - (641) (412) (1,240) Other income, net 382 312 844 561 -------- -------- --------- --------- Total other income (expense) 382 (329) 432 (679) -------- -------- -------- -------- Earnings before income tax provision 5,961 2,380 11,787 3,780 Income tax provision 2,205 792 4,361 1,300 -------- -------- -------- -------- NET EARNINGS $ 3,756 $ 1,588 $ 7,426 $ 2,480 ======== ======== ======== ======== Net earnings per common share: Primary $ .66 $ .40 $ 1.44 $ .62 Fully Diluted $ .65 $ .35 $ 1.33 $ .58 Dividends per common share $ .08 $ .08 $ .16 $ .16 Weighted average number of common shares outstanding: Primary 5,672 3,983 5,156 3,992 Fully Diluted 5,772 5,728 5,756 5,727
-4- 5 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited - in thousands)
26 weeks ended August 28, August 29, 1994 1993 NET CASH PROVIDED BY OPERATING ACTIVITIES: $ 10,351 $ 7,842 --------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant and equipment, net (7,461) (2,946) Purchases of marketable securities (9,997) (99,066) Proceeds from sales of marketable securities 15,841 105,079 --------- --------- Net cash (used in) provided by investing activities (1,617) 3,067 --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Net (payment) proceeds from short term debt (63) 274 Repayments of long-term borrowing (19) (10) Dividends paid (859) (637) Purchase of treasury stock - (6,566) Proceeds from exercise of stock options 611 - Debt conversion costs (100) - --------- --------- Net cash used in financing activities (430) (6,939) --------- --------- INCREASE IN CASH AND CASH EQUIVALENTS BEFORE EXCHANGE RATE CHANGES 8,304 3,970 EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS (69) (22) --------- -------- INCREASE IN CASH AND CASH EQUIVALENTS 8,235 3,948 CASH AND CASH EQUIVALENTS BEGINNING OF PERIOD 14,135 9,006 --------- --------- CASH AND CASH EQUIVALENTS END OF PERIOD $ 22,370 $ 12,954 ========= ========= SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid during the period for: Interest $ 25 $ 1,217 Income taxes $ 4,747 $ 769
SUPPLEMENTAL DISCLOSURE OF NON CASH FINANCING ACTIVITIES: During the quarter ended May 29, 1994 the Company issued 1,586,184 shares of Common Stock upon the conversion of $32,835,000 principal amount of Debentures. -5- 6 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The condensed consolidated balance sheet as of August 28, 1994, the consolidated statements of earnings for the 13 weeks and 26 weeks ended August 28, 1994 and August 29, 1993, and the consolidated statements of cash flows for the 26 week periods then ended have been prepared by the Company, without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at August 28, 1994, and the results of operations and cash flows for all periods presented have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company's Form 10-K/A Amendment No. 2 to its Annual Report on Form 10-K for the fiscal year ended February 27, 1994. 2. INVENTORIES Inventories consist of the following:
(In thousands) August 28, February 27, 1994 1994 ----------- ------------ Raw materials $ 6,499 $ 4,727 Work-in-process 3,285 3,479 Finished goods 7,849 7,581 Manufacturing supplies 404 357 ------- ------- $18,037 $16,144 ======= =======
3. LONG-TERM DEBT
(In thousands) August 28, February 27, 1994 1994 ----------- ------------- 7.25% Convertible Subordinated Debentures $ - $32,852 Other 12 71 ---- ------- 12 32,923 Less current portion (included in accrued liabilities) 3 62 ---- ------- $ 9 $32,861 ==== =======
-6- 7 On June 12, 1986, the Company issued $35,000,000 principal amount of 7.25% Convertible Subordinated Debentures maturing on June 15, 2006 with interest payable semiannually on June 15 and December 15 of each year. The Debentures were unsecured, subordinated to bank loans payable and other long-term debt and were convertible at any time prior to maturity, or earlier redemption, into shares of the Company's common stock at $20.70 per share. The Company had the option to redeem the Debentures at specified prices, plus accrued interest. On April 5, 1994, the Company announced that it had elected to redeem the Debentures on May 31, 1994. (Prior to that announcement, during the 1991 fiscal year, the Company had repurchased, in the open market, an aggregate of $1,602,000 principal amount of Debentures.) Including conversions prior to the call for redemption, $33,381,000 principal amount of Debentures were converted into 1,612,558 shares of the Company's common stock. The remaining $17,000 principal amount of Debentures not converted into common stock were redeemed on May 31, 1994. The $720,000 unamortized balance of deferred issuance costs incurred in connection with this financing was transferred from other assets to additional paid-in capital. As a result of the conversion and redemption of the Debentures, virtually all of the Company's long-term debt and associated interest expense has been eliminated. Furthermore, $515,000 (net of taxes) of accrued interest expense and costs related to the conversion of these Debentures has been reclassified to additional paid-in capital during the current fiscal year's first quarter. 4. SUPPLEMENTARY EARNINGS PER SHARE DATA During the quarter ended May 29, 1994, the Company issued 1,586,184 shares of its common stock upon the conversion of $32,835,000 principal amount Debentures. Supplementary earnings per share for the 13 weeks and 26 weeks ended August 28, 1994 of $0.66 and $1.36 per share, respectively, reflect the earnings per share that would have resulted if the conversion of these shares had occurred at the beginning of the fiscal year. -7- 8 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. Results of Operations During the Company's current fiscal year's second quarter ended August 28, 1994, sales increased 24% to $58,795,000 from $47,318,000 during last year's second quarter. In addition, operating profit increased 106% to $5,579,000 for the current fiscal year's second quarter from $2,709,000 for last year's second quarter. During the current fiscal year's second quarter, the Company's electronics segment accounted for $50,805,000 of its sales or 86% of the Company's total sales worldwide. Electronics sales increased by 23% during this fiscal year's second quarter from last year's second quarter electronics sales of $41,374,000. The Company's foreign operations, which are dedicated almost exclusively to the electronics segment, accounted for $13,811,000 in sales or 23% of total sales worldwide during the second quarter. Foreign sales during this fiscal year's second quarter increased 30% from last year's second quarter foreign sales of $10,664,000. Fiscal second quarter sales by the plumbing and industrial component segment increased 34% to $7,990,000 from $5,944,000 during last year's second quarter. The gross margin percentage for the Company's worldwide operations was 21.3% for the current fiscal year's second quarter as compared to 18.8% for the prior year's second quarter. The results for the second quarter improved due principally to the performance of the Company's United States based electronics operations as described below. The performance of the electronics segment continued its trend of improvement during the second quarter of the current fiscal year, predominantly as the result of the strength of the Company's United States based electronics operations. This improvement continues to be attributable to increased sales volumes and enhanced manufacturing efficiencies. Downward pricing pressure persists worldwide due to the competitive market environment, and has shown no signs of abatement. The performance of the Company's European electronics operations continues to suffer as the result of the weakness of the European printed circuit industry. Although still weak, there have been some signs of a slight improvement in the European markets served by the Company's European operations during the second quarter of the current year. The facility expansion of the Company's Far East based electronics operation is expected to be completed during the current year. The Company's plumbing and industrial component segment continued to underperform in the second quarter, largely due to the poor results of the plumbing hardware business. However, the plumbing hardware business started to improve towards the end of the second quarter. The Company's advanced composite business has continued its trend of improved results under it's new management team. The Company's industrial adhesive tape business performed well during the second quarter. Selling, general and administrative expenses, measured as a percentage of sales, were 11.8% during the current fiscal year's second quarter as compared to 13.1% during the same period in the prior year. -8- 9 Virtually no interest expense was incurred during the current fiscal year's second quarter, as compared to $641,000 during the prior fiscal year's second quarter. During the first quarter of the current year the Company elected to call it's 7 1/4% Convertible Debentures for redemption. As a result of this call for redemption, nearly all of the Debentures outstanding at the beginning of the fiscal year were converted into the Company's common stock during the first quarter. This eliminated practically all of the Company's long-term debt and the related debt service costs. The prior year interest expenses represented the interest payments made by the Company on its Convertible Debentures and, to a lesser extent, on the loans carried by certain of the Company's foreign subsidiaries. Other income, which consists principally of investment income, increased 22% to $382,000 for the current fiscal year's second quarter from $312,000 for the prior fiscal year's second quarter. The increase in investment income is attributable to the fact that the Company had a greater amount of funds available for investment during the current year's second quarter than during the prior year's second quarter. The Company's cash reserves continue to be invested primarily in short term taxable instruments and government securities. The Company's effective income tax rate for the current fiscal year's second quarter was 37%, as compared to 33% during the prior fiscal year's second quarter. This increase is primarily due to the reduction of benefits from favorable foreign tax rate differentials. During the current fiscal year's second quarter, the Company's net earnings increased 137% to $3,756,000 from $1,588,000 during the prior fiscal year's second quarter. Primary earnings per share increased to $.66 for the current year's second quarter from $.40 for the prior year's second quarter, and fully diluted earnings per share increased to $.65 for the current year's second quarter from $.35 for the comparable prior period. This increase in net earnings was attributable to the increase in operating profit. The primary earnings per share calculation for the current year's second quarter reflects the issuance, by the Company, of 1,586,184 shares of its common stock during the current fiscal year's first quarter as a result of the conversion of the Debentures discussed above. Liquidity and Capital Resources At August 28, 1994, the Company's cash and temporary investments amounted to $40,314,000, as compared to $38,053,000 at February 27, 1994, the end of the Company's last fiscal year. The increase in the Company's cash and investment position is attributable to several factors, including cash generated from operations. The Company's working capital position was $50,880,000 at August 28, 1994 as compared to $45,867,000 at February 27, 1994. The Company's current ratio, or the ratio of current assets to current liabilities, was 2.3 to 1 at August 28, 1994 as compared to 2.1 to 1 at February 27, 1994. During the current fiscal year's first six months, the Company generated $10,351,000 of funds from operations and expended $7,461,000 for the purchase of property, plant and equipment. On April 5, 1994, the Company announced that it had elected to redeem its 7 1/4% Convertible Subordinated Debentures on May 31, 1994. As a result of the call for redemption, $32,835,000 principal amount of Debentures were converted into 1,586,184 shares of the Company's common stock. The conversion of these Debentures eliminated virtually all of the Company's long-term debt, along with the debt service costs associated therewith. The Company believes its financial resources will be sufficient, for the foreseeable future, to provide for continued investment in property, plant and equipment and for general corporate purposes. Such resources are also available for appropriate acquisitions and other expansions of the Company's business. -9- 10 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES PART II. OTHER INFORMATION Item 1. Legal Proceedings. (a) There are no material pending legal proceedings to which the Company is a party or to which any of its properties is subject. (b) No material pending legal proceeding was terminated during the fiscal quarter ended August 28, 1994. Item 4. Submission of Matters to a Vote of Security Holders. At the annual meeting of shareholders held on July 12, 1994: (a) the persons elected as directors of the Company and the voting for such persons were as follows: Authority Name Votes For Withheld ------------- --------- --------- Anthony Chiesa 4,987,824 2,264 Lloyd Frank 4,986,824 3,264 Norman M. Schneider 4,987,424 2,664 Brian E. Shore 4,952,366 37,722 Jerry Shore 4,953,586 36,502 E. Philip Smoot 4,953,654 36,434 Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits: No. 11: Computation of Fully Diluted Earnings Per Common Share. (b) There were no reports on Form 8-K filed during the fiscal quarter ended August 28, 1994. -10- 11 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Park Electrochemical Corp. -------------------------- (Registrant) Date: October 11, 1994 /s/Jerry Shore ---------------- ------------------------- Jerry Shore Chairman of the Board and President Date: October 11, 1994 /s/Allen Levine ---------------- ------------------------- Allen Levine Vice President and Principal Financial Officer -11- 12 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES Quarterly Report on Form 10-Q for the fiscal quarter ended August 28, 1994 Exhibit No. Name Page 11 Computation of fully diluted 13 earnings per common share -12- 13 EXHIBIT NO. 11 PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES COMPUTATION OF FULLY DILUTED EARNINGS PER COMMON SHARE (Unaudited - in thousands, except per share data)
13 weeks ended 26 weeks ended August 28, 1994 August 28, 1994 _______________ _______________ ADJUSTMENT OF NET EARNINGS: Net earnings before adjustment $3,756 $7,426 Adjustments resulting from assumed conversion of 7 1/4% Convertible Subordinated Debentures: Reduction of interest expenses and amortization of deferred debt financing costs - 389 Related tax effect of above - (136) ------- ------- Net earnings as adjusted $3,756 $7,679 ======= ======= ADJUSTMENT OF WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: Weighted average number of common shares outstanding 5,672 5,156 Additional shares assuming conversion of: Convertible Subordinated Debentures - 504 Stock Options 100 96 ------- ------- Adjusted weighted average number of common shares outstanding during the period 5,772 5,756 ======= ======= Earnings per share fully diluted $ .65 $ 1.33 ======= =======
-13- EX-27 2 ART. 5 FDS FOR 2ND QUARTER 10-Q
5 This schedule contains summary financial information extracted from the financial statements of Park Electrochemical Corp. and is qualified in its entirety by reference to such financial statements. 1000 6-mos FEB-26-1995 AUG-28-1994 22,370 17,944 30,334 2,430 18,037 89,968 114,483 59,216 147,463 39,088 9 679 0 0 101,280 147,463 121,564 121,996 95,797 110,209 0 0 0 11,787 4,361 7,426 0 0 0 7,426 $1.44 $1.33
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