10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 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 June 2, 2019

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 Incorporation or Organization)	(I.R.S. Employer Identification No.)
48 South Service Road, Melville, N.Y.	11747
(Address of Principal Executive Offices)	(Zip Code)

                  (631) 465-3600                    

(Registrant’s Telephone Number, Including Area Code)

                  Not Applicable                    

(Former Name, Former Address and Former Fiscal Year,

if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, par value $.10 per share	PKE	New York Stock Exchange

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 [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer [ ] Accelerated Filer [X] Non-Accelerated Filer [ ] Smaller Reporting Company [ ] Emerging Growth Company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 20,492,377 as of July 3, 2019.

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PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES

TABLE OF CONTENTS

		Page Number
PART I.	FINANCIAL INFORMATION:
Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets June 2, 2019 (Unaudited) and March 3, 2019	4
	Consolidated Statements of Operations 13 weeks ended June 2, 2019 and May 27, 2018 (Unaudited)	5
	Consolidated Statements of Comprehensive Earnings 13 weeks ended June 2, 2019 and  May 27, 2018 (Unaudited)	6
	Consolidated Statements of Shareholders’ Equity June 2, 2019 and  May 27, 2018 (Unaudited)	7
	Condensed Consolidated Statements of Cash Flows 13 weeks ended June 2, 2019 and May 27, 2018 (Unaudited)	8
	Notes to Consolidated Financial Statements (Unaudited)	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
	Factors That May Affect Future Results	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27
Item 4.	Controls and Procedures	27
PART II.	OTHER INFORMATION:
Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3.	Defaults Upon Senior Securities	28
Item 4.	Mine Safety Disclosures	28
Item 5.	Other Information	28
Item 6.	Exhibits	29
EXHIBIT INDEX		30
SIGNATURES		31

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

	June 2, 2019 (unaudited)			March 3, 2019*
ASSETS
Current assets
Cash and cash equivalents	$	49,967		$	71,007
Marketable securities (Note 3)		101,090			80,617
Accounts receivable, less allowance for doubtful accounts of $36 and $32, respectively		8,919			9,352
Inventories (Note 4)		5,240			5,267
Prepaid expenses and other current assets		1,591			1,690
Total current assets		166,807			167,933
Property, plant and equipment, net		12,284			10,791
Operating right-of-use assets (Note 5)		462			-
Goodwill and other intangible assets		9,811			9,811
Other assets		311			316
Total assets	$	189,675		$	188,851
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable	$	1,971		$	3,169
Operating lease liability (Note 5)		188			-
Accrued liabilities		2,342			2,920
Income taxes payable		6,026			5,066
Total current liabilities		10,527			11,155
Long-term operating lease liability (Note 5)		274			-
Non-current income taxes payable (Note 9)		17,669			17,669
Deferred income taxes (Note 9)		81			-
Other liabilities		1,034			1,016
Total liabilities		29,585			29,840
Commitments and contingencies (Note 12)
Shareholders' equity (Note 8)
Common stock		2,096			2,096
Additional paid-in capital		169,463			169,395
Accumulated deficit		(2,067	)		(2,605	)
Accumulated other comprehensive earnings (loss)		324			(22	)
		169,816			168,864
Less treasury stock, at cost		(9,726	)		(9,853	)
Total shareholders' equity		160,090			159,011
Total liabilities and shareholders' equity	$	189,675		$	188,851

* The balance sheet at March 3, 2019 has been derived from the audited consolidated finacial statements at that date.

See Notes to Consolidated Financial Statements (Unaudited).

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PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except per share amounts)

	13 Weeks Ended (Unaudited)
	June 2,			May 27,
	2019			2018
Net sales	$	14,950		$	10,393
Cost of sales		10,146			7,541
Gross profit		4,804			2,852
Selling, general and administrative expenses		1,922			2,101
Earnings from continuing operations		2,882			751
Interest and other income		948			340
Earnings from continuing operations before income taxes		3,830			1,091
Income tax provision (Note 9)		1,116			275
Net earnings from continuing operations		2,714			816
(Loss) earnings from discontinued operations, net of tax (Note 11)		(127	)		2,352
Net earnings	$	2,587		$	3,168
Earnings per share (Note 7)
Basic:
Continuing operations	$	0.13		$	0.04
Discontinued operations		-			0.12
Basic earnings per share	$	0.13		$	0.16
Basic weighted average shares		20,492			20,242
Diluted:
Continuing operations	$	0.13		$	0.04
Discontinued operations		-			0.12
Diluted earnings per share	$	0.13		$	0.16
Diluted weighted average shares		20,586			20,296

See Notes to Consolidated Financial Statements (Unaudited).

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PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS

(Amounts in thousands)

	13 Weeks Ended (Unaudited)
	June 2,			May 27,
	2019			2018
Net earnings	$	2,587		$	3,168
Other comprehensive earnings (loss), net of tax:
Foreign currency translation		-			(19	)
Unrealized gains on marketable securities:
Unrealized holding gains arising during the period		344			-
Less: reclassification adjustment for gains included in net earnings		(8	)		-
Unrealized losses on marketable securities:
Unrealized holding losses arising during the period		(3	)		(17	)
Less: reclassification adjustment for losses included in net earnings		13			1
Other comprehensive earnings (loss)		346			(35	)
Total comprehensive earnings	$	2,933		$	3,133

See Notes to Consolidated Financial Statements (Unaudited).

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PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Amounts in thousands, except share and per share amounts)

								(Accumulated			Accumulated
					Additional			Deficit)			Other
	Common Stock				Paid-in			Retained			Comprehensive			Treasury Stock
	Shares		Amount		Capital			Earnings			Earnings (Loss)			Shares			Amount
Balance, March 3, 2019		20,965,144	$	2,096	$	169,395		$	(2,605	)	$	(22	)		479,191		$	(9,853	)
Net earnings		-		-		-			2,587			-			-			-
Unrealized gain on marketable securities, net of tax		-		-		-			-			346			-			-
Stock options exercised		-		-		(56	)		-			-			(6,200	)		127
Stock-based compensation		-		-		124			-			-			-			-
Cash dividends ($.10 per share)		-		-		-			(2,049	)		-			-			-
Balance, June 2, 2019		20,965,144	$	2,096	$	169,463		$	(2,067	)	$	324			472,991		$	(9,726	)

								(Accumulated			Accumulated
					Additional			Deficit)			Other
	Common Stock				Paid-in			Retained			Comprehensive			Treasury Stock
	Shares		Amount		Capital			Earnings			Earnings (Loss)			Shares			Amount
Balance, February 25, 2018		20,965,144	$	2,096	$	169,011		$	(21,099	)	$	131			723,573		$	(14,878	)
Net earnings		-		-		-			3,168			-			-			-
Foreign currency translation adjustment for sale of business		-		-		-			-			(19	)		-			-
Unrealized loss on marketable securities, net of tax		-		-		-			-			(16	)		-			-
Stock options exercised		-		-		(14	)		-			-			(2,987	)		61
Stock-based compensation		-		-		201			-			-			-			-
Cash dividends ($.10 per share)		-		-		-			(2,023	)		-			-			-
Balance, May 27, 2018		20,965,144	$	2,096	$	169,198		$	(19,954	)	$	96			720,586		$	(14,817	)

See Notes to Consolidated Financial Statements (Unaudited).

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PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

	13 Weeks Ended (Unaudited)
	June 2,			May 27,
	2019			2018
Cash flows from operating activities:
Net earnings from continuing operations	$	2,714		$	816
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		366			432
Stock-based compensation		124			201
Deferred income taxes		97			-
Amortization of bond premium		(56	)		22
Changes in operating assets and liabilities		(470	)		(3,063	)
Net cash provided by (used in) operating activities - continuing operations		2,775			(1,592	)
Net cash (used in) provided by operating activities - discontinued operations		(127	)		1,333
Net cash provided by (used in) operating activities		2,648			(259	)
Cash flows from investing activities:
Purchase of property, plant and equipment		(1,860	)		(10	)
Purchases of marketable securities		(34,046	)		(2,484	)
Proceeds from sales and maturities of marketable securities		14,196			3,091
Net cash (used in) provided by investing activities - continuing operations		(21,710	)		597
Net cash used in investing activities - discontinued operations		-			(3	)
Net cash (used in) provided by investing activities		(21,710	)		594
Cash flows from financing activities:
Dividends paid		(2,049	)		(2,023	)
Proceeds from exercise of stock options		71			47
Net cash used in financing activities - continuing operations		(1,978	)		(1,976	)
Net cash used in financing activities - discontinued operations		-			-
Net cash used in financing activities		(1,978	)		(1,976	)
Decrease in cash and cash equivalents before effect of exchange rate changes - continuing operations		(20,913	)		(2,971	)
(Decrease) increase in cash and cash equivalents before effect of exchange rate changes - discontinued operations		(127	)		1,330
Decrease in cash and cash equivalents before effect of exchange rate changes		(21,040	)		(1,641	)
Effect of exchange rate changes on cash and cash equivalents - continuing operations		-			(98	)
Effect of exchange rate changes on cash and cash equivalents - discontinued operations		-			122
Effect of exchange rate changes on cash and cash equivalents		-			24
Decrease in cash and cash equivalents:		(21,040	)		(1,617	)
Cash and cash equivalents, beginning of period		71,007			18,254
Cash and cash equivalents, end of period	$	49,967		$	16,637
Supplemental cash flow information:
Cash paid during the period for income taxes, net of refunds	$	-		$	2,442

See Notes to Consolidated Financial Statements (Unaudited).

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PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share (unless otherwise stated), per share and option amounts)

1. CONSOLIDATED FINANCIAL STATEMENTS

The Condensed Consolidated Balance Sheet and the Consolidated Statements of Shareholders’ Equity as of June 2, 2019, the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Earnings for the 13 weeks ended June 2, 2019 and May 27, 2018, and the Condensed Consolidated Statements of Cash Flows for the 13 weeks then ended have been prepared by Park Electrochemical Corp. (the “Company”), without audit. In the opinion of management, these unaudited consolidated financial statements contain all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at June 2, 2019 and the results of operations and cash flows for all periods presented. The Consolidated Statements of Operations are not necessarily indicative of the results to be expected for the full fiscal year or any subsequent interim period.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 3, 2019. There have been no significant changes to such accounting policies during the 13 weeks ended June 2, 2019.

On July 25, 2018, the Company entered into a definitive agreement to sell its Electronics Business for $145,000 in cash. This transaction was completed on December 4, 2018. (See Note 11).

The Company has classified the operating results of its Electronics Business, together with certain costs related to the transaction, as discontinued operations, net of tax, in the Consolidated Statements of Operations, in accordance with Accounting Standards Codification (“ASC”) 205-20 Discontinued Operations (See Note 11).

2. FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date.

Fair value measurements are broken down into three levels based on the reliability of inputs as follows:

Level 1 inputs are quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates and yield curves observable at commonly quoted intervals or current market) and contractual prices for the underlying financial instrument, as well as other relevant economic measures.

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Level 3 inputs are unobservable inputs for the asset or liability. Unobservable inputs are used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date.

The fair value of the Company’s cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to their short-term nature. Certain assets and liabilities of the Company are required to be recorded at fair value on either a recurring or non-recurring basis. On a recurring basis, the Company records its marketable securities at fair value using Level 1 or Level 2 inputs. (See Note 3).

The Company’s non-financial assets measured at fair value on a non-recurring basis include goodwill and any long-lived assets written down to fair value. To measure fair value of such assets, the Company uses Level 3 inputs consisting of techniques including an income approach and a market approach. The income approach is based on a discounted cash flow analysis and calculates the fair value by estimating the after-tax cash flows attributable to a reporting unit and then discounting the after-tax cash flows to a present value using a risk-adjusted discount rate. Assumptions used in the discounted cash flow analysis require the exercise of significant judgment, including judgment about appropriate discount rates, terminal values, growth rates and the amount and timing of expected future cash flows. There were no transfers between levels within the fair value hierarchy during the 13 weeks ended June 2, 2019 and May 27, 2018. With respect to goodwill, the Company first assesses qualitative factors to determine whether it is more likely than not that fair value is less than carrying value. If, based on that assessment, the Company believes it is more likely than not that fair value is less than carrying value, a goodwill impairment test is performed. There have been no changes in events or circumstances which required impairment charges to be recorded during the 13 weeks ended June 2, 2019.

3. MARKETABLE SECURITIES

All marketable securities are classified as available-for-sale and are carried at fair value, with the unrealized gains and losses, net of tax, included in comprehensive earnings. Realized gains and losses, amortization of premiums and discounts, and interest and dividend income are included in interest and other income in the Consolidated Statements of Operations. The costs of securities sold are based on the specific identification method.

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The following is a summary of available-for-sale securities:

	June 2, 2019
	Total		Level 1		Level 2		Level 3
U.S. Treasury and other government securities	$	89,111	$	89,111	$	-	$	-
U.S. corporate debt securities		11,979		11,979		-		-
Total marketable securities	$	101,090	$	101,090	$	-	$	-

	March 3, 2019
	Total		Level 1		Level 2		Level 3
U.S. Treasury and other government securities	$	68,718	$	68,718	$	-	$	-
U.S. corporate debt securities		11,899		11,899		-		-
Total marketable securities	$	80,617	$	80,617	$	-	$	-

The following table shows the amortized cost basis of, and gross unrealized gains and losses on, the Company’s available-for-sale securities:

	Amortized Cost Basis		Gross Unrealized Gains		Gross Unrealized Losses
June 2, 2019:
U.S. Treasury and other government securities	$	88,738	$	386	$	13
U.S. corporate debt securities		11,942		38		1
Total marketable securities	$	100,680	$	424	$	14
March 3, 2019:
U.S. Treasury and other government securities	$	68,727	$	44	$	53
U.S. corporate debt securities		11,924		7		32
Total marketable securities	$	80,651	$	51	$	85

The estimated fair values of such securities at June 2, 2019 by contractual maturity are shown below:

Due in one year or less	$	16,500
Due after one year through five years		84,590
	$	101,090

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4. INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out method) or net realizable value. The Company writes down its inventory for estimated obsolescence or unmarketability based upon the age of the inventory and assumptions about future demand for the Company’s products and market conditions. Work-in-process and finished goods inventories cost valuations include direct material costs as well as a portion of the Company’s overhead expenses. The Company’s overhead expenses that are applied to its finished goods inventories are based on actual expenses related to the procurement, storage, shipment and production of the finished goods. Inventories consisted of the following:

	June 2,		March 3,
	2019		2019
Inventories:
Raw materials	$	4,025	$	4,556
Work-in-process		292		232
Finished goods		923		479
	$	5,240	$	5,267

5. LEASES

The Company has operating leases related to land, office space, warehouse space and equipment. All of the Company’s leases have been assessed to be operating leases. Renewal options are included in the lease term to the extent the Company is reasonably certain to exercise the option. The exercise of lease renewal options is at the Company’s sole discretion. The incremental borrowing rate represents the Company’s ability to borrow on a collateralized basis over a term similar to the lease term. The leases typically contain renewal options for periods ranging from one year to ten years and require the Company to pay real estate taxes and other operating costs. The latest land lease expiration is 2068 assuming exercise of all applicable renewal options by the Company. The Company’s existing leases are not subject to any restrictions or covenants which preclude its ability to pay dividends, obtain financing or exercise its available renewal options.

Future minimum lease payments under non-cancellable operating leases as of June 2, 2019 are as follows:

Fiscal Year:
2020	$	173
2021		61
2022		61
2023		61
2024		61
Thereafter		160
Total undiscounted operating lease payments		577
Less imputed interest		(115	)
Present value of operating lease payments	$	462

The above payment schedule includes renewal options that the Company is reasonably likely to exercise. Leases with an initial term of 12 months or less are not recorded on the Company’s balance sheet. The Company recognizes lease expense for these leases on a straight line basis over the terms of the leases. The above payment schedule does not include lease payments of $588 in 2020 and $463 in 2021 for the Company’s idle facility in Fullerton California that have been accrued on the condensed consolidated balance sheets in accrued liabilities.

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For the three months ended June 2, 2019, the Company’s operating lease expense was $97. Cash payments of $95, pertaining to operating leases, are reflected in the cash flow statement under cash flows from operating activities.

The following table sets forth the right-of-use assets and operating lease liabilities as of June 2, 2019:

Operating right-of-use assets	$	462
Operating lease liabilities		188
Long-term operating lease liabilities		274
Total operating lease liabilities	$	462

The Company’s weighted average remaining lease term for its operating leases is 6.0 years

In December 2018, the Company’s Park Aerospace Technologies Corp. (“PATC”) business unit located at the Newton, Kansas Airport entered into a Development Agreement with the City of Newton, Kansas and the Board of County Commissioners of Harvey County, Kansas. Pursuant to this agreement, PATC agreed to construct and operate an additional manufacturing facility approximately 90,000 square feet in size for the design, development and manufacture of advanced composite materials and parts, structures and assemblies for aerospace. PATC further agreed to equip the facility through the purchase of machinery, equipment and furnishings and to create additional new full-time employment of specified levels during a five year period. In exchange for these agreements, the City and the County agreed to lease to PATC three acres of land at the Newton, Kansas Airport, in addition to the eight acres previously leased to PATC by the City and County. The City and County further agreed to provide financial and other assistance toward the construction of the additional facility as set forth in the Development Agreement. The Company estimates the total cost of the additional facility to be approximately $20 million, and the Company expects to complete the construction of the additional facility in the first half of the 2020 calendar year. As of June 2, 2019, the Company had $2,173 in equipment purchase obligations related to the additional facility.

6. STOCK-BASED COMPENSATION

As of June 2, 2019, the Company had a 2018 Stock Option Plan (the “2018 Plan”), and no other stock-based compensation plan. The 2018 Plan was adopted by the Board of Directors of the Company on May 8, 2018 and approved by the shareholders of the Company at the Annual Meeting of Shareholders of the Company on July 24, 2018 and provides for the grant of options to purchase up to 800,000 shares of common stock of the Company. Prior to the 2018 Plan, the Company had the 2002 Stock Option Plan (the “2002 Plan”) which had been approved by the Company’s shareholders and provided for the grant of stock options to directors and key employees of the Company. All options granted under the 2018 Plan and 2002 Plan have exercise prices equal to the fair market value of the underlying common stock of the Company at the time of grant, which, pursuant to the terms of the such Plans, is the reported closing price of the common stock on the New York Stock Exchange on the date preceding the date the option is granted. Options granted under the Plans become exercisable 25% one year after the date of grant, with an additional 25% exercisable each succeeding anniversary of the date of grant, and expire 10 years after the date of grant. Upon termination of employment or service as a director of an optionee, all options held by the optionee that have not previously become exercisable shall terminate and all other options held by such optionee may be exercised, to the extent exercisable on the date of such termination, for a limited time after such termination. Any shares of common stock subject to an option under the 2018 Plan which expires or is terminated unexercised as to such shares shall again become available for issuance under the 2018 Plan.

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The 2002 Plan terminated on May 21, 2018, and authority to grant additional options under the 2002 Plan expired on that date. All options granted under the 2002 Plan will expire in April 2028 or earlier.

During the 13 weeks ended June 2, 2019, the Company granted options under the 2018 Plan to purchase a total of 114,450 shares of common stock to its directors and certain of its employees. The future compensation expense to be recognized in earnings before income taxes is $454 and will be recorded on a straight-line basis over the requisite service period. The weighted average fair value of the granted options was $3.97 per share using the Black-Scholes option pricing model with the following assumptions: risk free interest rate of 2.24%-2.26%; expected volatility factor of 30.4%-31.5%; expected dividend yield of 2.43%; and estimated option term of 4.3-5.8 years.

The risk-free interest rates were based on U.S. Treasury rates at the date of grant with maturity dates approximately equal to the estimated terms of the options at the date of the grant. Volatility factors were based on historical volatility of the Company’s common stock. The expected dividend yields were based on the regular quarterly cash dividend per share most recently declared by the Company and on the exercise price of the options granted during the 13 weeks ended June 2, 2019. The estimated term of the options was based on evaluations of the historical and expected future employee exercise behavior.

The following is a summary of option activity for the 13 weeks ended June 2, 2019:

	Outstanding Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)
Balance, March 3, 2019		540,709		$	13.49
Granted		114,450			16.44
Exercised		(6,200	)		11.91
Terminated or expired		(66,750	)		18.83
Balance, June 2, 2019		582,209		$	13.47		4.19
Vested and exercisable, June 2, 2019		436,609		$	13.10		5.45

7. EARNINGS PER SHARE

Basic earnings per share are computed by dividing net earnings by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share are computed by dividing net earnings by the sum of (a) the weighted average number of shares of common stock outstanding during the period and (b) the potentially dilutive securities outstanding during the period. Stock options are the only potentially dilutive securities; and the number of dilutive options is computed using the treasury stock method.

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The following table sets forth the calculation of basic and diluted earnings per share:

	13 Weeks Ended
	June 2, 2019			May 27, 2018
Net earnings - continuing operations	$	2,714		$	816
Net earnings - discontinued operations		(127	)		2,352
Net earnings	$	2,587		$	3,168
Weighted average common shares outstanding for basic EPS		20,492			20,242
Net effect of dilutive options		94			54
Weighted average shares outstanding for diluted EPS		20,586			20,296
Basic earnings per share - continuing operations	$	0.13		$	0.04
Basic earnings per share - discontinued operations		-			0.12
Basic earnings per share	$	0.13		$	0.16
Diluted earnings per share - continuing operations	$	0.13		$	0.04
Diluted earnings per share - discontinued operations		-			0.12
Diluted earnings per share	$	0.13		$	0.16

Potentially dilutive securities, which were not included in the computation of diluted earnings per share, because either the effect would have been anti-dilutive or the options’ exercise prices were greater than the average market price of the common stock, were 191,000 and 544,000 for the 13 weeks ended June 2, 2019 and May 27, 2018, respectively.

8. SHAREHOLDERS’ EQUITY

During the 13 weeks ended June 2, 2019, the Company sold 6,200 shares of the Company’s treasury stock pursuant to the exercises of employee stock options and received proceeds of $71 from such exercises and recognized stock-based compensation expense, net of recognized tax benefits, of $124. These transactions resulted in a $68 increase in additional paid-in capital during the period.

On January 8, 2015, the Company announced that its Board of Directors authorized the Company’s purchase, on the open market and in privately negotiated transactions, of up to 1,250,000 shares of its common stock, representing approximately 6% of the Company’s 20,945,634 total outstanding shares as of the close of business on January 7, 2015. This authorization superseded all prior Board of Directors’ authorizations to purchase shares of the Company’s common stock.

On March 10, 2016, the Company announced that its Board of Directors authorized the Company’s purchase, on the open market and in privately negotiated transactions, of up to 1,000,000 additional shares of its common stock, in addition to the unused prior authorization to purchase shares of the Company’s common stock announced on January 8, 2015. As a result, the Company is authorized to purchase up to a total of 1,531,412 shares of its common stock, representing approximately 7.5% of the Company’s 20,492,377 total outstanding shares as of the close of business on July 3, 2019.

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The Company did not purchase any shares of its common stock during the 13 weeks ended June 2, 2019 or during the 13 weeks ended May 27, 2018.

9. INCOME TAXES

For the 13 weeks ended June 2, 2019, the Company recorded an income tax provision from continuing operations of $1,116, which included a discrete income tax provision of $153. For the 13 weeks ended May 27, 2018, the Company recorded an income tax provision from continuing operations of $275.

The Company’s effective tax rate for the 13 weeks ended June 2, 2019 was an income tax provision of 29.1%, compared to an income tax provision of 25.2% in the comparable prior period. The effective tax rate for the 13 weeks ended June 2, 2019 was higher than the U.S. statutory rate of 21% primarily due to state and local taxes, a discrete income tax provision for stock compensation and the accrual of interest related to unrecognized tax benefits. The effective rate for the 13 weeks ended May 27, 2018 was higher than the U.S. statutory rate of 21% primarily due to state and local taxes.

Notwithstanding the U.S. taxation of the deemed repatriated earnings as a result of the mandatory one-time transition tax on the accumulated untaxed earnings of foreign subsidiaries of U.S. shareholders included in the 2017 Tax Cuts and Jobs Act, the Company intends to indefinitely invest approximately $25 million of undistributed earnings outside of the U.S. If these future earnings are repatriated to the U.S., or if the Company determines such earnings will be remitted in the foreseeable future, the Company may be required to accrue U.S. deferred taxes. The Company repatriated $0, $113,600, and $135,300 in cash from the Company’s subsidiary in Singapore in the 2020, 2019 and 2018 fiscal years, respectively.

10. GEOGRAPHIC REGIONS

The Company’s products are sold to customers in North America, Asia and Europe. The Company’s manufacturing facilities are located in Kansas. Sales are attributed to geographic regions based upon the region in which the materials were delivered to the customer. Sales between geographic regions were not significant.

Financial information regarding the Company’s continuing operations by geographic region is as follows:

	13 Weeks Ended
	June 2, 2019		May 27, 2018
Sales:
North America	$	14,190	$	9,233
Asia		252		132
Europe		508		1,028
Total sales	$	14,950	$	10,393

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	June 2, 2019		March 3, 2019
Long-lived assets:
North America	$	21,093	$	19,372
Asia		1,775		1,546
Europe		-		-
Total long-lived assets	$	22,868	$	20,918

11. DISCONTINUED OPERATIONS

On July 25, 2018, the Company entered into a definitive agreement to sell its Electronics Business for $145,000 in cash. The Company completed this transaction on December 4, 2018.

The Company has classified the operating results of its Electronics Business, together with certain costs related to the transaction, as discontinued operations, net of tax, in the Consolidated Statements of Operations.

The following table shows the summary operating results of the discontinued operations:

	13 Weeks Ended (Unaudited)
	June 2,			May 27,
	2019			2018
Net sales	$	-		$	20,709
Cost of sales		-			15,053
Gross profit		-			5,656
Selling, general and administrative expenses		136			2,718
Restructuring charges		33			183
(Loss) earnings from discontinued operations		(169	)		2,755
Other income		-			-
(Loss) earnings from discontinued operations before income taxes		(169	)		2,755
Income tax (benefit) provision		(42	)		403
Net (loss) earnings from discontinued operations	$	(127	)	$	2,352

During the 2018 fiscal year, the Company consolidated its Nelco Products, Inc. Business Unit located in Fullerton, California and its Neltec, Inc. Business Unit located in Tempe, Arizona. The Company estimates the remaining pre-tax charge in connection with the consolidation to be approximately $778, which the Company expects to incur primarily during the fiscal year ending February 28, 2021.

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The following table sets forth the charges and accruals related to the consolidation:

	Accrual March 3, 2019		Current Period Charges		Cash Payments			Non-Cash Charges		Accrual June 2, 2019		Total Expense Accrued to Date		Total Expected Costs
Facility Lease Costs	$	1,324	$	13	$	(205	)	$	-	$	1,132	$	2,842	$	2,842
Severance Costs		-		-		-			-		-		1,081		1,081
Equipment Removal		-		-		-			-		-		-		700
Other		-		20		(20	)		-		-		799		877
Total Restructuring Charges	$	1,324	$	33	$	(225	)	$	-	$	1,132	$	4,722	$	5,500

12. CONTINGENCIES

Litigation 

The Company is subject to a small number of immaterial proceedings, lawsuits and other claims related to environmental, employment, product and other matters. The Company is required to assess the likelihood of any adverse judgments or outcomes in these matters as well as potential ranges of probable losses. A determination of the amount of reserves required, if any, for these contingencies is made after careful analysis of each individual issue. The required reserves may change in the future due to new developments in each matter or changes in approach, such as a change in settlement strategy in dealing with these matters. The Company believes that the ultimate disposition of such proceedings, lawsuits and claims will not have a material adverse effect on the liquidity, capital resources, business, consolidated results of operations or financial position of the Company.

Environmental Contingencies 

The Company and certain of its subsidiaries have been named by the Environmental Protection Agency (the “EPA”) or a comparable state agency under the Comprehensive Environmental Response, Compensation and Liability Act (the “Superfund Act”) or similar state law as potentially responsible parties in connection with alleged releases of hazardous substances at three sites.

Under the Superfund Act and similar state laws, all parties who may have contributed any waste to a hazardous waste disposal site or contaminated area identified by the EPA or comparable state agency may be jointly and severally liable for the cost of cleanup. Generally, these sites are locations at which numerous persons disposed of hazardous waste. In the case of the Company’s subsidiaries, generally the waste was removed from their manufacturing facilities and disposed at waste sites by various companies which contracted with the subsidiaries to provide waste disposal services. Neither the Company nor any of its subsidiaries have been accused of or charged with any wrongdoing or illegal acts in connection with any such sites. The Company believes it maintains an effective and comprehensive environmental compliance program.

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The insurance carriers which provided general liability insurance coverage to the Company and its subsidiaries for the years during which the Company’s subsidiaries’ waste was disposed at these three sites have in the past reimbursed the Company and its subsidiaries for 100% of their legal defense and remediation costs associated with two of these sites.

The Company does not record environmental liabilities and related legal expenses for which the Company believes that it and its subsidiaries have general liability insurance coverage for the years during which the Company’s subsidiaries’ waste was disposed at two sites for which certain subsidiaries of the Company have been named as potentially responsible parties. Pursuant to such general liability insurance coverage, three insurance carriers reimburse the Company and its subsidiaries for 100% of the legal defense and remediation costs associated with the two sites.

Included in selling, general and administrative expenses are charges for actual expenditures and accruals, based on estimates, for certain environmental matters described above. The Company accrues estimated costs associated with known environmental matters, when such costs can be reasonably estimated and when the outcome appears probable. The Company believes that the ultimate disposition of known environmental matters will not have a material adverse effect on the Company’s results of operations, cash flows or financial position.

13. ACCOUNTING PRONOUNCEMENTS

Recently Adopted

In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02, Leases, which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a lease (i.e., lessees and lessors). The new standard requires lessees to classify leases as either finance leases or operating leases and record a right-of-use asset and a lease liability for all leases with terms greater than 12 months regardless of their classification. An accounting policy election may be made to account for leases with a term of 12 months or less similar to existing guidance for operating leases today. ASU No. 2016-02 supersedes the existing guidance on accounting for leases. In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, which allows for an optional transition method for the adoption of Topic 842. The two permitted transition methods are now the modified retrospective approach, which applies the new lease requirements at the beginning of the earliest period presented, and the optional transition method, which applies the new lease requirements through a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. ASU 2016-02 is effective for the Company’s fiscal year ending March 1, 2020 and the interim periods within that year. The Company adopted this standard in the first quarter of the 2020 fiscal year using the optional transition method. The optional transition method enables the Company to adopt the new standard as of the beginning of the period of adoption and does not require restatement of prior period financial information. As a result, prior period financial information has not been recast and continues to be reported under the accounting guidance that was effective during those periods. The Company also elected the practical expedients that allow the Company to carry forward the historical lease classification. At adoption, the Company elected the following practical expedients: (1) the “package of practical expedients”, pursuant to which the Company did not need to reassess its prior conclusions about lease identification, lease classification and initial direct costs, (2) creation of an accounting policy for short-term leases resulting in lease payments being recorded as an expense on a straight-line basis over the lease term, and (3) to account separately for lease and non-lease components for all leases. The Company has established an inventory of existing leases and implemented a new process of evaluating the classification of each lease. The financial impact of the adoption of the new standard in the 2020 fiscal year increased total assets and total liabilities by approximately $551. The financial impact of the adoption primarily relates to the capitalization of right-of-use assets and recognition of lease liability related to operating leases. The Company has implemented changes to its processes and internal controls, as necessary, to meet the reporting and disclosure requirements of the new standard. See Note 5, Leases, for additional information with respect to the impact of the adoption of the lease accounting guidance and the disclosures required by ASU 2016-02 and the related amendments.

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In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. This ASU allows for reclassification of stranded tax effects resulting from U.S. Tax Reform from accumulated other comprehensive loss to retained earnings, but it does not require this reclassification. This ASU is effective for the Company’s fiscal year ending March 1, 2020 and the interim periods within that year. The Company adopted this ASU in the first quarter of its 2020 fiscal year and elected to reclassify the stranded tax effects resulting from U.S. Tax Reform. As a result of that election, the adoption of ASU 2018-02 did not have an impact on the Company’s consolidated financial statements and disclosures.

Recently Issued

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. This ASU modifies the disclosure requirements for fair value measurements by removing the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy and the policy for timing of such transfers. This ASU expands the disclosure requirements for Level 3 fair value measurements, primarily focused on changes in unrealized gains and losses included in other comprehensive income (loss). This ASU is effective for the Company’s fiscal year ending February 28, 2021 and for the interim periods within that year. Early adoption is permitted. ASU 2018-13 is generally required to be applied retrospectively to all periods presented upon their effective date with the exception of certain amendments, which should be applied prospectively to the most recent interim or annual period presented in the year of adoption. The Company is currently evaluating the potential impact of adopting this guidance on its consolidated financial statements and disclosures.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

General:

Park Electrochemical Corp. (“Park” or the “Company”) is an aerospace company which 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 (undergoing qualification) and lightning strike 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 patented composite SigmaStrut^TM and AlphaStrut^TM product lines) are, among others, prototype and development aircraft, special mission aircraft, spares for legacy military and civilian aircraft and exotic spacecraft.

On December 4, 2018, Park completed the previously announced sale of its Electronics Business, including manufacturing facilities in Singapore, France, California and Arizona and R&D facilities in Singapore and Arizona, to AGC Inc. for an aggregate purchase price of $145 million in cash, subject to post-closing adjustments for changes in working capital compared to target net working capital, excluding cash in certain acquired subsidiaries and certain accrued and unpaid taxes of certain acquired subsidiaries. See Note 11, “Discontinued Operations”, of the Notes to Consolidated Financial Statements elsewhere in this Report for additional information on the Sale. As a result, the discussion below is of the Company’s continuing operations, which are comprised of the aerospace business.

Financial Overview

The Company's total net sales from continuing operations in the 13 weeks ended June 2, 2019 were $15.0 million compared to $10.4 million in the 13 weeks ended May 27, 2018.

The Company’s gross profit margins from continuing operations, measured as percentages of sales, were 32.1% in the 13 weeks ended June 2, 2019 compared to 27.4% in the 13 weeks ended May 27, 2018.

The Company’s earnings from continuing operations before income taxes and net earnings from continuing operations increased 251% and 233%, respectively, in the 13 weeks ended June 2, 2019 compared to the 13 weeks ended May 27, 2018 primarily as a result of higher sales and higher interest income, partially offset by a higher tax provision compared to last year’s comparable period.

The Company has a number of long-term contracts pursuant to which certain of its customers, some of which represent a substantial portion of the Company’s revenue, place orders. Long-term contracts with the Company’s customers are primarily requirements based and do not guarantee quantities. An order forecast is generally agreed concurrently with pricing for any applicable long-term contract. This order forecast is then typically updated periodically during the term of the underlying contract. Purchase orders generally are received in excess of three months in advance of delivery.

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Results of Operations:

The following table sets forth the components of the consolidated statements of operations:

	13 Weeks Ended
(amounts in thousands, except per share amounts)	June 2,			May 27,		%
	2019			2018		Change
Net sales	$	14,950		$	10,393		44	%
Cost of sales		10,146			7,541		35	%
Gross profit		4,804			2,852		68	%
Selling, general and administrative expenses		1,922			2,101		(9	)%
Earnings from continuing operations		2,882			751		284	%
Interest and other income		948			340		179	%
Earnings from continuing operations before income taxes		3,830			1,091		251	%
Income tax provision		1,116			275		306	%
Net earnings from continuing operations		2,714			816		233	%
(Loss) earnings from discontinued operations, net of tax		(127	)		2,352		(105	)%
Net earnings	$	2,587		$	3,168		(18	)%
Earnings per share:
Basic:
Continuing operations	$	0.13		$	0.04		225	%
Discontinued operations		-			0.12		(100	)%
Basic earnings per share	$	0.13		$	0.16		(19	)%
Diluted:
Continuing operations	$	0.13		$	0.04		225	%
Discontinued operations		-			0.12		(100	)%
Diluted earnings per share	$	0.13		$	0.16		(19	)%

Net Sales

The Company’s total net sales from continuing operations worldwide in the 13 weeks ended June 2, 2019 increased to $15.0 million from $10.4 million in the 13 weeks ended May 27, 2018. The increase in sales was due to the ramping up of programs on which the Company’s materials are qualified.

Gross Profit

The Company’s gross profit from continuing operations in the 13 weeks ended June 2, 2019 was higher than its gross profit from continuing operations in the prior year’s comparable period, and the gross profit from continuing operations as a percentage of sales for the Company’s worldwide operations in the 13 weeks ended June 2, 2019 increased to 32.1% from 27.4% in the 13 weeks ended May 27, 2018. The higher gross profit margin from continuing operations for the 13 weeks ended June 2, 2019 compared to the 13 weeks ended May 27, 2018 was principally a result of higher sales and the partially fixed nature of overhead expenses in the 13 weeks ended June 2, 2019 compared to the 13 weeks ended May 27, 2018, partially offset by increased direct labor and supplies expense.

Selling, General and Administrative Expenses

Selling, general and administrative expenses from continuing operations decreased by $179,000 during the 13 weeks ended June 2, 2019, or by 9%, compared to last fiscal year's comparable period, and these expenses, measured as a percentage of sales from continuing operations, were 12.9% in the 13 weeks ended June 2, 2019 compared to 20.2% in the 13 weeks ended May 27, 2018. The decrease in such expenses during the 13 weeks ended June 2, 2019 was primarily the result of lower payroll, travel and entertainment and stock option expenses.

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Selling, general and administrative expenses from continuing operations included stock option expenses of $124,000 for the 13 weeks ended June 2, 2019, compared to stock option expenses of $201,000 for the 13 weeks ended May 27, 2018.

Earnings from Continuing Operations

For the reasons set forth above, the Company’s earnings from continuing operations were $2.9 million for the 13 weeks ended June 2, 2019 compared to $0.8 million for the 13 weeks ended May 27, 2018.

 Interest and Other Income

Interest and other income from continuing operations was $948,000 for the 13 weeks ended June 2, 2019, compared to $340,000 for last fiscal year's comparable period. Interest income increased 179% for the 13 weeks ended June 2, 2019 primarily as a result of higher average balances of marketable securities held by the Company in the 13 weeks ended June 2, 2019, compared to last fiscal year's comparable period, and higher weighted average interest rates. During the 13 weeks ended June 2, 2019, the Company earned interest income principally from its investments, which consisted primarily of short-term instruments and money market funds.

Income Tax Provision

For the 13 weeks ended June 2, 2019, the Company recorded an income tax provision from continuing operations of $1,116, which included a discrete income tax provision of $144 pertaining to expired stock options of former employees who transferred to AGC Inc. in the sale of the Company’s Electronics Business. For the 13 weeks ended May 27, 2018, the Company recorded an income tax provision from continuing operations of $275.

The Company’s effective tax rate for the 13 weeks ended June 2, 2019 was 29.1% compared to 25.2% in the comparable prior period. The effective tax rate for the 13 weeks ended June 2, 2019 was higher than the U.S. statutory rate of 21% primarily due to state and local taxes, a discrete income tax provision for stock compensation and the accrual of interest related to unrecognized tax benefits. The effective rate for the 13 weeks ended May 27, 2018 was higher than the U.S. statutory rate of 21% primarily due to state and local taxes.

Net Earnings from Continuing Operations

For the reasons set forth above, the Company's net earnings from continuing operations for the 13 weeks ended June 2, 2019 were $2.7 million compared to net earnings from continuing operations of $816,000 for the 13 weeks ended May 27, 2018.

Discontinued Operations

On July 25, 2018, the Company entered into a definitive agreement to sell its Electronics Business for $145.0 million in cash. The Company completed this transaction on December 4, 2018.

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The operating results of the Electronics Business are classified, together with certain costs related to the transaction, as discontinued operations, net of tax, in the Consolidated Statements of Operations.

The Company’s net earnings from discontinued operations included expenses pertaining to the sale transaction and costs in connection with the vacated facility in Fullerton California in the 13 weeks ended June 2, 2019 compared full operating results of the Electronics Business for the 13 weeks ended May 27, 2018.

Basic and Diluted Earnings Per Share

In the 13 weeks ended June 2, 2019, basic and diluted earnings per share from continuing operations were $0.13, including the tax expense described above. This compared to basic and diluted earnings per share from continuing operations of $0.04 in the 13 weeks ended May 27, 2018. The net impact of the tax benefit described above decreased basic and diluted earnings per share by $0.01 for the 13 weeks ended June 2, 2019.

Liquidity and Capital Resources - Continuing Operations:

(amounts in thousands)	June 2,		March 3,
	2019		2019		Change
Cash and cash equivalents and marketable securities	$	151,057	$	151,624	$	(567	)
Working capital		156,280		156,778		(498	)

	13 Weeks Ended
(amounts in thousands)	June 2,			May 27,
	2019			2018			Change
Net cash provided by (used in) operating activities	$	2,775		$	(1,592	)	$	4,367
Net cash (used in) provided by investing activities		(21,710	)		597			(22,307	)
Net cash used in financing activities		(1,978	)		(1,976	)		(2	)

Cash and Marketable Securities

Of the $151.1 million of cash and cash equivalents and marketable securities at June 2, 2019, $126.8 million was owned by certain of the Company’s wholly owned foreign subsidiaries.

The change in cash and cash equivalents and marketable securities at June 2, 2019 compared to March 3, 2019 was the result of capital expenditures and dividends paid to shareholders partially offset by cash provided by operating activities and a number of additional factors. The significant changes in cash provided by operating activities were as follows:

● accounts receivable decreased by 5% at June 2, 2019 compared to March 3, 2019 primarily due to a lower sales in the quarter ended June 2, 2019 compared to the fourth quarter of the 2019 fiscal year;

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● prepaid expenses and other current assets decreased by 6% at June 2, 2019 compared to March 3, 2019 primarily due to a decrease in interest receivable on marketable securities and a decrease in a receivable from AGC Inc.;

● accounts payable decreased by 38% at June 2, 2019 compared to March 3, 2019 primarily due to the timing of vendor payments and raw material purchases from suppliers;

● accrued liabilities decreased by 20% at June 2, 2019 compared to March 3, 2019 primarily due to decreases in restructuring accruals and bonus accruals; and

● income taxes payable increased by 19% at June 2, 2019 compared to March 3, 2019 primarily due to the income tax provision for the 13 weeks ended June 2, 2019.

In addition, the Company paid $2.0 million in cash dividends in each of the 13-week periods ended June 2, 2019 and May 27, 2018.

Working Capital

The decrease in working capital at June 2, 2019 compared to March 3, 2019 was due principally to the decrease in accounts receivable, increase in income taxes payable and a decrease in prepaid expenses and other current assets, partially offset by the decreases in accounts payable and accrued liabilities.

The Company's current ratio (the ratio of current assets to current liabilities) was 15.8 to 1.0 at June 2, 2019 compared to 15.1 to 1.0 at March 3, 2019.

Cash Flows

During the 13 weeks ended June 2, 2019, the Company's net earnings, before depreciation and amortization, stock-based compensation, amortization of bond premium and changes in operating assets and liabilities, were $2.8 million. During the same 13-week period, the Company expended $1,860,000 for the purchase of property, plant and equipment, compared with $10,000 during the 13 weeks ended May 27, 2018. The Company paid $2.0 million in cash dividends in each of the 13-week periods ended June 2, 2019 and May 27, 2018.

Other Liquidity Factors

The Company believes its financial resources will be sufficient, through the 12 months following the filing of this Form 10-Q Quarterly Report and for the foreseeable future thereafter, to provide for continued investment in working capital and property, plant and equipment and for general corporate purposes. The Company’s financial resources are also available for purchases of the Company's common stock, appropriate acquisitions and other expansions of the Company's business, including the recently announced expansion in Kansas.

The Company is not aware of any circumstances or events that are reasonably likely to occur that could materially affect its liquidity.

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Contractual Obligations:

The Company’s contractual obligations and other commercial commitments to make future payments under contracts, such as lease agreements, consist only of (i) operating lease commitments and (ii) commitments to purchase raw materials. The Company has no other long-term debt, capital lease obligations, unconditional purchase obligations or other long-term obligations, standby letters of credit, guarantees, standby repurchase obligations or other commercial commitments or contingent commitments, other than two standby letters of credit in the total amount of $320,000 to secure the Company’s obligations under its workers’ compensation insurance program.

Off-Balance Sheet Arrangements:

The Company’s liquidity is not dependent on the use of, and the Company is not engaged in, any off-balance sheet financing arrangements, such as securitization of receivables or obtaining access to assets through special purpose entities.

Critical Accounting Policies and Estimates:

The foregoing Discussion and Analysis of Financial Condition and Results of Operations is based upon the Company’s Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these Consolidated Financial Statements requires the Company to make estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent liabilities. On an ongoing basis, the Company evaluates its estimates, including those related to sales allowances, allowances for doubtful accounts, inventories, valuation of long-lived assets, income taxes, contingencies and litigation, and employee benefit programs. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

The Company’s critical accounting policies that are important to the Consolidated Financial Statements and that entail, to a significant extent, the use of estimates and assumptions and the application of management’s judgment are described in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, in the Company’s Annual Report on Form 10-K for the fiscal year ended March 3, 2019. There have been no significant changes to such accounting policies during the 2020 fiscal year first quarter with the exception of the implementation of ASC 842 (See Note 5 under Notes to Consolidated Financial Statements in Part I, Item 1 of this Report).

Contingencies:

The Company is subject to a small number of immaterial proceedings, lawsuits and other claims related to environmental, employment, product and other matters. The Company is required to assess the likelihood of any adverse judgments or outcomes in these matters as well as potential ranges of probable losses. A determination of the amount of reserves required, if any, for these contingencies is made after careful analysis of each individual issue. The required reserves may change in the future due to new developments in each matter or changes in approach, such as a change in settlement strategy in dealing with these matters.

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Factors That May Affect Future Results.

Certain portions of this Report which do not relate to historical financial information may be deemed to constitute forward-looking statements that are subject to various factors which could cause actual results to differ materially from the Company’s expectations or from results which might be projected, forecasted, estimated or budgeted by the Company in forward-looking statements. Such factors include, but are not limited to, general conditions in the aerospace industry, the Company’s competitive position, the status of the Company’s relationships with its customers, economic conditions in international markets, the cost and availability of raw materials, transportation and utilities, and the various factors set forth under the caption “Factors That May Affect Future Results” in Item 1 and in Item 1A “Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended March 3, 2019.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

The Company’s market risk exposure at June 2, 2019 is consistent with, and not greater than, the types of market risk and amount of exposures presented in the Annual Report on Form 10-K for the fiscal year ended March 3, 2019.

Item 4. Controls and Procedures.

(a)     Disclosure Controls and Procedures.

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of June 2, 2019, the end of the quarterly fiscal period covered by this quarterly report. Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act and were effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

(b)     Changes in Internal Control Over Financial Reporting.

There has not been any change in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

There have been no material changes in the risk factors as previously disclosed in the Company’s Form 10-K Annual Report for the fiscal year ended March 3, 2019.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

The following table provides information with respect to shares of the Company’s common stock acquired by the Company during each month included in the Company’s 2020 fiscal year first quarter ended June 2, 2019.

Period	Total Number of Shares (or Units) Purchased		Average Price Paid Per Share (or Unit)		Total Number of Shares (or Units) Purchased As Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
March 4 - April 2		0	$	-		0
April 3 - May 2		0	$	-		0
May 3 - June 2		0	$	-		0
Total		0	$	-		0		1,531,412 (a)

(a) Aggregate number of shares available to be purchased by the Company pursuant to share purchase authorizations announced on January 8, 2015 and March 10, 2016. Pursuant to such authorizations, the Company is authorized to purchase its shares from time to time on the open market or in privately negotiated transactions.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.

28

Item 6. Exhibits.

31.1 Certification of principal executive officer pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a).

31.2 Certification of principal financial officer pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a).

32.1 Certification of principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Certification of principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101 The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 2, 2019, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets at June 2, 2019 (unaudited) and March 3, 2019; (ii) Consolidated Statements of Operations for the 13 weeks ended June 2, 2019 and May 27, 2018 (unaudited); (iii) Consolidated Statements of Comprehensive Earnings for the 13 weeks ended June 2, 2019 and May 27, 2018 (unaudited); (iv) Consolidated Statements of Shareholders’ Equity at June 2, 2019 (unaudited) and May 27, 2018; and (v) Condensed Consolidated Statements of Cash Flows for the 13 weeks ended June 2, 2019 and May 27, 2018 (unaudited). * +

*     Filed electronically herewith.

+     Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

29

EXHIBIT INDEX

Exhibit No. -----------	Name ----
31.1	Certification of principal executive officer pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a).
31.2	Certification of principal financial officer pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a).
32.1	Certification of principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 2, 2019, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets at June 2, 2019 (unaudited) and March 3, 2019; (ii) Consolidated Statements of Operations for the 13 weeks ended June 2, 2019 and May 27, 2018 (unaudited); (iii) Consolidated Statements of Comprehensive Earnings for the 13 weeks ended June 2, 2019 and May 27, 2018 (unaudited); (iv) Consolidated Statements of Shareholders’ Equity at June 2, 2019 (unaudited) and May 27, 2018; and (v) Condensed Consolidated Statements of Cash Flows for the 13 weeks ended June 2, 2019 and May 27, 2018 (unaudited). * +
*	Filed electronically herewith.
+	Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

30

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)
	/s/ Brian E. Shore
Date:  July 11, 2019	Brian E. Shore Chief Executive Officer (principal executive officer)
	/s/ P. Matthew Farabaugh
Date:  July 11, 2019	P. Matthew Farabaugh Senior Vice President and Chief Financial Officer (principal financial officer) (principal accounting officer)

31

EX-31.1

EXHIBIT 31.1

Certification of Principal Executive Officer

Pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a)

I, Brian E. Shore, as Chief Executive Officer of Park Electrochemical Corp., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 2, 2019 of Park Electrochemical Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:      July 11, 2019

/s/           Brian E. Shore                                                      

Name:    Brian E. Shore

Title:      Chief Executive Officer

EX-31.2

EXHIBIT 31.2

Certification of Principal Financial Officer

Pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a)

I, P. Matthew Farabaugh, as Senior Vice President and Chief Financial Officer of Park Electrochemical Corp., certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 2, 2019 of Park Electrochemical Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:      July 11, 2019

/s/ P. Matthew Farabaugh                                              

Name:  P. Matthew Farabaugh

Title: Senior Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

Certification of Principal Executive Officer Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Park Electrochemical Corp. (the “Company”) for the quarterly period ended June 2, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Brian E. Shore, as Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)     The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)     The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Brian E. Shore                                                 

Name: Brian E. Shore

Title: Chief Executive Officer

Date: July 11, 2019

EX-32.2

EXHIBIT 32.2

Certification of Principal Financial Officer Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Park Electrochemical Corp. (the “Company”) for the quarterly period ended June 2, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), P. Matthew Farabaugh, as Senior Vice President and Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)     The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)     The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/        P. Matthew Farabaugh________________________

Name: P. Matthew Farabaugh

Title: Senior Vice President and Chief Financial Officer

Date:  July 11, 2019

XML

Document And Entity Information - shares	3 Months Ended
	Jun. 02, 2019	Jul. 03, 2019
Document Information [Line Items]
Entity Registrant Name	PARK ELECTROCHEMICAL CORP
Entity Central Index Key	0000076267
Trading Symbol	pke
Current Fiscal Year End Date	--03-01
Entity Filer Category	Accelerated Filer
Entity Current Reporting Status	Yes
Entity Emerging Growth Company	false
Entity Small Business	false
Entity Common Stock, Shares Outstanding (in shares)		20,492,377
Document Type	10-Q
Document Period End Date	Jun. 02, 2019
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Shell Company	false

XML

Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 03, 2019	[1]
Current assets
Cash and cash equivalents	$ 49,967	$ 71,007
Marketable securities (Note 3)	101,090	80,617
Accounts receivable, less allowance for doubtful accounts of $36 and $32, respectively	8,919	9,352
Inventories (Note 4)	5,240	5,267
Prepaid expenses and other current assets	1,591	1,690
Total current assets	166,807	167,933
Property, plant and equipment, net	12,284	10,791
Operating right-of-use assets	462
Goodwill and other intangible assets	9,811	9,811
Other assets	311	316
Total assets	189,675	188,851
Current liabilities
Accounts payable	1,971	3,169
Operating lease liabilities	188
Accrued liabilities	2,342	2,920
Income taxes payable	6,026	5,066
Total current liabilities	10,527	11,155
Long-term operating lease liabilities	274
Non-current income taxes payable (Note 9)	17,669	17,669
Deferred income taxes (Note 9)	81
Other liabilities	1,034	1,016
Total liabilities	29,585	29,840
Commitments and contingencies (Note 12)
Shareholders' equity (Note 8)
Common stock	2,096	2,096
Additional paid-in capital	169,463	169,395
Accumulated deficit	(2,067)	(2,605)
Accumulated other comprehensive earnings (loss)	324	(22)
	169,816	168,864
Less treasury stock, at cost	(9,726)	(9,853)
Total shareholders' equity	160,090	159,011
Total liabilities and shareholders' equity	$ 189,675	$ 188,851

[1] The balance sheet at March 3, 2019 has been derived from the audited consolidated finacial statements at that date.

XML

Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 03, 2019
Accounts receivable, allowance for doubtful accounts	$ 36		[1]

[1] The balance sheet at March 3, 2019 has been derived from the audited consolidated finacial statements at that date.

XML

Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands	3 Months Ended
	Jun. 02, 2019	May 27, 2018
Net sales	$ 14,950,000	$ 10,393,000
Cost of sales	10,146,000	7,541,000
Gross profit	4,804,000	2,852,000
Selling, general and administrative expenses	1,922,000	2,101,000
Earnings from continuing operations	2,882,000	751,000
Interest and other income	948,000	340,000
Earnings from continuing operations before income taxes	3,830,000	1,091,000
Income tax provision (Note 9)	1,116,000	275,000
Net earnings from continuing operations	2,714,000	816,000
(Loss) earnings from discontinued operations, net of tax (Note 11)	(127,000)	2,352,000
Net earnings	$ 2,587,000	$ 3,168,000
Basic:
Continuing operations (in dollars per share)	$ 0.13	$ 0.04
Discontinued operations (in dollars per share)		0.12
Basic earnings per share (in dollars per share)	$ 0.13	$ 0.16
Basic weighted average shares (in shares)	20,492	20,242
Diluted:
Continuing operations (in dollars per share)	$ 0.13	$ 0.04
Discontinued operations (in dollars per share)		0.12
Diluted earnings per share (in dollars per share)	$ 0.13	$ 0.16
Diluted weighted average shares (in shares)	20,586	20,296

XML

Consolidated Statements of Comprehensive Earnings (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Jun. 02, 2019	May 27, 2018
Net earnings	$ 2,587	$ 3,168
Other comprehensive earnings (loss), net of tax:
Foreign currency translation		(19)
Other comprehensive earnings (loss)	346	(35)
Total comprehensive earnings	2,933	3,133
Gains on Marketable Securities [Member]
Other comprehensive earnings (loss), net of tax:
Unrealized holding gains (losses) arising during the period	344
Less: reclassification adjustment for gains (losses) included in net earnings	(8)
Losses on Marketable Securities [Member]
Other comprehensive earnings (loss), net of tax:
Unrealized holding gains (losses) arising during the period	(3)	(17)
Less: reclassification adjustment for gains (losses) included in net earnings	$ 13	$ 1

XML

Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Treasury Stock [Member]	Total
Balance (in shares) at Feb. 25, 2018	20,965,144				723,573
Balance at Feb. 25, 2018	$ 2,096	$ 169,011	$ (21,099)	$ 131	$ (14,878)
Net earnings			3,168			$ 3,168
Unrealized holding gains (losses) arising during the period				(16)
Stock options exercised (in shares)					(2,987)
Stock options exercised		(14)			$ 61
Stock-based compensation		201
Cash dividends ($.10 per share)			(2,023)
Foreign currency translation adjustment for sale of business				(19)
Balance (in shares) at May. 27, 2018	20,965,144				720,586
Balance at May. 27, 2018	$ 2,096	169,198	(19,954)	96	$ (14,817)
Balance (in shares) at Mar. 03, 2019	20,965,144				479,191
Balance at Mar. 03, 2019	$ 2,096	169,395	(2,605)	(22)	$ (9,853)	159,011	[1]
Net earnings			2,587			$ 2,587
Unrealized holding gains (losses) arising during the period				346
Stock options exercised (in shares)					(6,200)	6,200
Stock options exercised		(56)			$ 127
Stock-based compensation		124				$ 68
Cash dividends ($.10 per share)			(2,049)
Balance (in shares) at Jun. 02, 2019	20,965,144				472,991
Balance at Jun. 02, 2019	$ 2,096	$ 169,463	$ (2,067)	$ 324	$ (9,726)	$ 160,090

[1] The balance sheet at March 3, 2019 has been derived from the audited consolidated finacial statements at that date.

XML

Consolidated Statements of Shareholders' Equity (Unaudited) (Parentheticals) - $ / shares	3 Months Ended
	Jun. 02, 2019	May 27, 2018
Retained Earnings [Member]
Cash dividends, per share (in dollars per share)	$ 0.10	$ 0.10

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Jun. 02, 2019	May 27, 2018
Cash flows from operating activities:
Net earnings from continuing operations	$ 2,714	$ 816
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	366	432
Stock-based compensation	124	201
Deferred income taxes	97
Amortization of bond premium	(56)	22
Changes in operating assets and liabilities	(470)	(3,063)
Net cash provided by (used in) operating activities - continuing operations	2,775	(1,592)
Net cash (used in) provided by operating activities - discontinued operations	(127)	1,333
Net cash provided by (used in) operating activities	2,648	(259)
Cash flows from investing activities:
Purchase of property, plant and equipment	(1,860)	(10)
Purchases of marketable securities	(34,046)	(2,484)
Proceeds from sales and maturities of marketable securities	14,196	3,091
Net cash (used in) provided by investing activities - continuing operations	(21,710)	597
Net cash used in investing activities - discontinued operations		(3)
Net cash (used in) provided by investing activities	(21,710)	594
Cash flows from financing activities:
Dividends paid	(2,049)	(2,023)
Proceeds from exercise of stock options	71	47
Net cash used in financing activities - continuing operations	(1,978)	(1,976)
Net cash used in financing activities - discontinued operations
Net cash used in financing activities	(1,978)	(1,976)
Decrease in cash and cash equivalents before effect of exchange rate changes - continuing operations	(20,913)	(2,971)
(Decrease) increase in cash and cash equivalents before effect of exchange rate changes - discontinued operations	(127)	1,330
Decrease in cash and cash equivalents before effect of exchange rate changes	(21,040)	(1,641)
Effect of exchange rate changes on cash and cash equivalents - continuing operations		(98)
Effect of exchange rate changes on cash and cash equivalents - discontinued operations		122
Effect of exchange rate changes on cash and cash equivalents		24
Decrease in cash and cash equivalents:	(21,040)	(1,617)
Cash and cash equivalents, beginning of period	71,007	18,254
Cash and cash equivalents, end of period	49,967	16,637
Supplemental cash flow information:
Cash paid during the period for income taxes, net of refunds		$ 2,442

XML

Note 1 - Consolidated Financial Statements

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1

.

CONSOLIDATED FINANCIAL STATEMENTS

The Condensed Consolidated Balance Sheet and the Consolidated Statements of Shareholders’ Equity as of

June 2, 2019,

the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Earnings for the

13

weeks ended

June 2, 2019

and

May 27, 2018,

and the Condensed Consolidated Statements of Cash Flows for the

13

weeks then ended have been prepared by Park Electrochemical Corp. (the “Company”), without audit. In the opinion of management, these unaudited consolidated financial statements contain all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at

June 2, 2019

and the results of operations and cash flows for all periods presented. The Consolidated Statements of Operations are

not

necessarily indicative of the results to be expected for the full fiscal year or any subsequent interim period.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form

10

-K for the fiscal year ended

March 3, 2019.

There have been

no

significant changes to such accounting policies during the

13

weeks ended

June 2, 2019.

On

July 25, 2018,

the Company entered into a definitive agreement to sell its Electronics Business for

$145,000

in cash. This transaction was completed on

December 4, 2018. (

See Note

11

).

The Company has classified the operating results of its Electronics Business, together with certain costs related to the transaction, as discontinued operations, net of tax, in the Consolidated Statements of Operations, in accordance with Accounting Standards Codification (“ASC”)

205

-

20

Discontinued Operations

(See Note

11

).

XML

Note 2 - Fair Value Measurements

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Fair Value Disclosures [Text Block]

2

.

FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (

i.e

., the “exit price”) in an orderly transaction between market participants at the measurement date.

Fair value measurements are broken down into

three

levels based on the reliability of inputs as follows:

Level

1

inputs are quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level

2

inputs are inputs other than quoted prices included within Level

1

that are observable for the asset or liability, either directly or indirectly. Level

2

inputs include quoted prices for similar assets or liabilities in active markets, inputs other than quoted prices that are observable for the asset or liability (

e.g.

, interest rates and yield curves observable at commonly quoted intervals or current market) and contractual prices for the underlying financial instrument, as well as other relevant economic measures.

Level

3

inputs are unobservable inputs for the asset or liability. Unobservable inputs are used to measure fair value to the extent that observable inputs are

not

available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date.

The fair value of the Company’s cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to their short-term nature. Certain assets and liabilities of the Company are required to be recorded at fair value on either a recurring or non-recurring basis. On a recurring basis, the Company records its marketable securities at fair value using Level

1

or Level

2

inputs. (See Note

3

).

The Company’s non-financial assets measured at fair value on a non-recurring basis include goodwill and any long-lived assets written down to fair value. To measure fair value of such assets, the Company uses Level

3

inputs consisting of techniques including an income approach and a market approach. The income approach is based on a discounted cash flow analysis and calculates the fair value by estimating the after-tax cash flows attributable to a reporting unit and then discounting the after-tax cash flows to a present value using a risk-adjusted discount rate. Assumptions used in the discounted cash flow analysis require the exercise of significant judgment, including judgment about appropriate discount rates, terminal values, growth rates and the amount and timing of expected future cash flows. There were

no

transfers between levels within the fair value hierarchy during the

13

weeks ended

June 2, 2019

and

May 27, 2018.

With respect to goodwill, the Company

first

assesses qualitative factors to determine whether it is more likely than

not

that fair value is less than carrying value. If, based on that assessment, the Company believes it is more likely than

not

that fair value is less than carrying value, a goodwill impairment test is performed. There have been

no

changes in events or circumstances which required impairment charges to be recorded during the

13

weeks ended

June 2, 2019.

XML

Note 3 - Marketable Securities

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

3

.

MARKETABLE SECURITIES

All marketable securities are classified as available-for-sale and are carried at fair value, with the unrealized gains and losses, net of tax, included in comprehensive earnings. Realized gains and losses, amortization of premiums and discounts, and interest and dividend income are included in interest and other income in the Consolidated Statements of Operations. The costs of securities sold are based on the specific identification method.

The following is a summary of available-for-sale securities:

	June 2, 2019
	Total		Level 1		Level 2		Level 3
U.S. Treasury and other government securities	$	89,111	$	89,111	$	-	$	-
U.S. corporate debt securities		11,979		11,979		-		-
Total marketable securities	$	101,090	$	101,090	$	-	$	-

	March 3, 2019
	Total		Level 1		Level 2		Level 3
U.S. Treasury and other government securities	$	68,718	$	68,718	$	-	$	-
U.S. corporate debt securities		11,899		11,899		-		-
Total marketable securities	$	80,617	$	80,617	$	-	$	-

The following table shows the amortized cost basis of, and gross unrealized gains and losses on, the Company’s available-for-sale securities:

	Amortized Cost Basis		Gross Unrealized Gains		Gross Unrealized Losses
June 2, 2019:
U.S. Treasury and other government securities	$	88,738	$	386	$	13
U.S. corporate debt securities		11,942		38		1
Total marketable securities	$	100,680	$	424	$	14
March 3, 2019:
U.S. Treasury and other government securities	$	68,727	$	44	$	53
U.S. corporate debt securities		11,924		7		32
Total marketable securities	$	80,651	$	51	$	85

The estimated fair values of such securities at

June 2, 2019

by contractual maturity are shown below:

Due in one year or less	$	16,500
Due after one year through five years		84,590
	$	101,090

XML

Note 4 - Inventories

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Inventory Disclosure [Text Block]

4

.

INVENTORIES

Inventories are stated at the lower of cost (

first

-in,

first

-out method) or net realizable value. The Company writes down its inventory for estimated obsolescence or unmarketability based upon the age of the inventory and assumptions about future demand for the Company’s products and market conditions. Work-in-process and finished goods inventories cost valuations include direct material costs as well as a portion of the Company’s overhead expenses. The Company’s overhead expenses that are applied to its finished goods inventories are based on actual expenses related to the procurement, storage, shipment and production of the finished goods. Inventories consisted of the following:

	June 2,		March 3,
	2019		2019
Inventories:
Raw materials	$	4,025	$	4,556
Work-in-process		292		232
Finished goods		923		479
	$	5,240	$	5,267

XML

Note 5 - Leases

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

5.

L

EASES

The Company has operating leases related to land, office space, warehouse space and equipment. All of the Company’s leases have been assessed to be operating leases. Renewal options are included in the lease term to the extent the Company is reasonably certain to exercise the option. The exercise of lease renewal options is at the Company’s sole discretion. The incremental borrowing rate represents the Company’s ability to borrow on a collateralized basis over a term similar to the lease term. The leases typically contain renewal options for periods ranging from

one

year to

ten

years and require the Company to pay real estate taxes and other operating costs. The latest land lease expiration is

2068

assuming exercise of all applicable renewal options by the Company. The Company’s existing leases are

not

subject to any restrictions or covenants which preclude its ability to pay dividends, obtain financing or exercise its available renewal options.

Future minimum lease payments under non-cancellable operating leases as of

June 2, 2019

are as follows:

Fiscal Year:
2020	$	173
2021		61
2022		61
2023		61
2024		61
Thereafter		160
Total undiscounted operating lease payments		577
Less imputed interest		(115	)
Present value of operating lease payments	$	462

The above payment schedule includes renewal options that the Company is reasonably likely to exercise. Leases with an initial term of

12

months or less are

not

recorded on the Company’s balance sheet. The Company recognizes lease expense for these leases on a straight line basis over the terms of the leases. The above payment schedule does

not

include lease payments of

$588

in

2020

and

$463

in

2021

for the Company’s idle facility in Fullerton California that have been accrued on the condensed consolidated balance sheets in accrued liabilities.

For the

three

months ended

June 2, 2019,

the Company’s operating lease expense was

$97.

Cash payments of

$95,

pertaining to operating leases, are reflected in the cash flow statement under cash flows from operating activities.

The following table sets forth the right-of-use assets and operating lease liabilities as of

June 2, 2019:

Operating right-of-use assets	$	462
Operating lease liabilities		188
Long-term operating lease liabilities		274
Total operating lease liabilities	$	462

The Company’s weighted average remaining lease term for its operating leases is

6.0

years

In

December 2018,

the Company’s Park Aerospace Technologies Corp. (“PATC”) business unit located at the Newton, Kansas Airport entered into a Development Agreement with the City of Newton, Kansas and the Board of County Commissioners of Harvey County, Kansas. Pursuant to this agreement, PATC agreed to construct and operate an additional manufacturing facility approximately

90,000

square feet in size for the design, development and manufacture of advanced composite materials and parts, structures and assemblies for aerospace. PATC further agreed to equip the facility through the purchase of machinery, equipment and furnishings and to create additional new full-time employment of specified levels during a

five

year period. In exchange for these agreements, the City and the County agreed to lease to PATC

three

acres of land at the Newton, Kansas Airport, in addition to the

eight

acres previously leased to PATC by the City and County. The City and County further agreed to provide financial and other assistance toward the construction of the additional facility as set forth in the Development Agreement. The Company estimates the total cost of the additional facility to be approximately

$20

million, and the Company expects to complete the construction of the additional facility in the

first

half of the

2020

calendar year. As of

June 2, 2019,

the Company had

$2,173

in equipment purchase obligations related to the additional facility.

XML

Note 6 - Stock-based Compensation

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Share-based Payment Arrangement [Text Block]

6

. STOCK-BASED COMPENSATION

As of

June 2, 2019,

the Company had a

2018

Stock Option Plan (the

“2018

Plan”), and

no

other stock-based compensation plan. The

2018

Plan was adopted by the Board of Directors of the Company on

May 8, 2018

and approved by the shareholders of the Company at the Annual Meeting of Shareholders of the Company on

July 24, 2018

and provides for the grant of options to purchase up to

800,000

shares of common stock of the Company. Prior to the

2018

Plan, the Company had the

2002

Stock Option Plan (the

“2002

Plan”) which had been approved by the Company’s shareholders and provided for the grant of stock options to directors and key employees of the Company. All options granted under the

2018

Plan and

2002

Plan have exercise prices equal to the fair market value of the underlying common stock of the Company at the time of grant, which, pursuant to the terms of the such Plans, is the reported closing price of the common stock on the New York Stock Exchange on the date preceding the date the option is granted. Options granted under the Plans become exercisable

25%

one

year after the date of grant, with an additional

25%

exercisable each succeeding anniversary of the date of grant, and expire

10

years after the date of grant. Upon termination of employment or service as a director of an optionee, all options held by the optionee that have

not

previously become exercisable shall terminate and all other options held by such optionee

may

be exercised, to the extent exercisable on the date of such termination, for a limited time after such termination. Any shares of common stock subject to an option under the

2018

Plan which expires or is terminated unexercised as to such shares shall again become available for issuance under the

2018

Plan.

The

2002

Plan terminated on

May 21, 2018,

and authority to grant additional options under the

2002

Plan expired on that date. All options granted under the

2002

Plan will expire in

April 2028

or earlier.

During the

13

weeks ended

June 2, 2019,

the Company granted options under the

2018

Plan to purchase a total of

114,450

shares of common stock to its directors and certain of its employees. The future compensation expense to be recognized in earnings before income taxes is

$454

and will be recorded on a straight-line basis over the requisite service period. The weighted average fair value of the granted options was

$3.97

per share using the Black-Scholes option pricing model with the following assumptions: risk free interest rate of

2.24%

-

2.26%;

expected volatility factor of

30.4%

-

31.5%;

expected dividend yield of

2.43%;

and estimated option term of

4.3

-

5.8

years.

The risk-free interest rates were based on U.S. Treasury rates at the date of grant with maturity dates approximately equal to the estimated terms of the options at the date of the grant. Volatility factors were based on historical volatility of the Company’s common stock. The expected dividend yields were based on the regular quarterly cash dividend per share most recently declared by the Company and on the exercise price of the options granted during the

13

weeks ended

June 2, 2019.

The estimated term of the options was based on evaluations of the historical and expected future employee exercise behavior.

The following is a summary of option activity for the

13

weeks ended

June 2, 2019:

	Outstanding Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)
Balance, March 3, 2019		540,709		$	13.49
Granted		114,450			16.44
Exercised		(6,200	)		11.91
Terminated or expired		(66,750	)		18.83
Balance, June 2, 2019		582,209		$	13.47		4.19
Vested and exercisable, June 2, 2019		436,609		$	13.10		5.45

XML

Note 7 - Earnings Per Share

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Earnings Per Share [Text Block]

7

.

EARNINGS PER SHARE

Basic earnings per share are computed by dividing net earnings by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share are computed by dividing net earnings by the sum of (a) the weighted average number of shares of common stock outstanding during the period and (b) the potentially dilutive securities outstanding during the period. Stock options are the only potentially dilutive securities; and the number of dilutive options is computed using the treasury stock method.

The following table sets forth the calculation of basic and diluted earnings per share:

	13 Weeks Ended
	June 2, 2019			May 27, 2018
Net earnings - continuing operations	$	2,714		$	816
Net earnings - discontinued operations		(127	)		2,352
Net earnings	$	2,587		$	3,168
Weighted average common shares outstanding for basic EPS		20,492			20,242
Net effect of dilutive options		94			54
Weighted average shares outstanding for diluted EPS		20,586			20,296
Basic earnings per share - continuing operations	$	0.13		$	0.04
Basic earnings per share - discontinued operations		-			0.12
Basic earnings per share	$	0.13		$	0.16
Diluted earnings per share - continuing operations	$	0.13		$	0.04
Diluted earnings per share - discontinued operations		-			0.12
Diluted earnings per share	$	0.13		$	0.16

Potentially dilutive securities, which were

not

included in the computation of diluted earnings per share, because either the effect would have been anti-dilutive or the options’ exercise prices were greater than the average market price of the common stock, were

191,000

and

544,000

for the

13

weeks ended

June 2, 2019

and

May 27, 2018,

respectively.

XML

Note 8 - Shareholders' Equity

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

8

.

SHAREHOLDERS

’

EQUITY

During the

13

weeks ended

June 2, 2019,

the Company sold

6,200

shares of the Company’s treasury stock pursuant to the exercises of employee stock options and received proceeds of

$71

from such exercises and recognized stock-based compensation expense, net of recognized tax benefits, of

$124.

These transactions resulted in a

$68

increase in additional paid-in capital during the period.

On

January 8, 2015,

the Company announced that its Board of Directors authorized the Company’s purchase, on the open market and in privately negotiated transactions, of up to

1,250,000

shares of its common stock, representing approximately

6%

of the Company’s

20,945,634

total outstanding shares as of the close of business on

January 7, 2015.

This authorization superseded all prior Board of Directors’ authorizations to purchase shares of the Company’s common stock.

On

March 10, 2016,

the Company announced that its Board of Directors authorized the Company’s purchase, on the open market and in privately negotiated transactions, of up to

1,000,000

additional shares of its common stock, in addition to the unused prior authorization to purchase shares of the Company’s common stock announced on

January 8, 2015.

As a result, the Company is authorized to purchase up to a total of

1,531,412

shares of its common stock, representing approximately

7.5%

of the Company’s

20,492,377

total outstanding shares as of the close of business on

July 3, 2019.

The Company did

not

purchase any shares of its common stock during the

13

weeks ended

June 2, 2019

or during the

13

weeks ended

May 27, 2018.

XML

Note 9 - Income Taxes

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Income Tax Disclosure [Text Block]

9

.

INCOME TAXES

For the

13

weeks ended

June 2, 2019,

the Company recorded an income tax provision from continuing operations of

$1,116,

which included a discrete income tax provision of

$153.

For the

13

weeks ended

May 

27,

2018,

the Company recorded an income tax provision from continuing operations of

$275.

The Company’s effective tax rate for the

13

weeks ended

June 2, 2019

was an income tax provision of

29.1%,

compared to an income tax provision of

25.2%

in the comparable prior period. The effective tax rate for the

13

weeks ended

June 2, 2019

was higher than the U.S. statutory rate of

21%

primarily due to state and local taxes, a discrete income tax provision for stock compensation and the accrual of interest related to unrecognized tax benefits. The effective rate for the

13

weeks ended

May 27, 2018

was higher than the U.S. statutory rate of

21%

primarily due to state and local taxes.

Notwithstanding the U.S. taxation of the deemed repatriated earnings as a result of the mandatory

one

-time transition tax on the accumulated untaxed earnings of foreign subsidiaries of U.S. shareholders included in the

2017

Tax Cuts and Jobs Act, the Company intends to indefinitely invest approximately

$25

million of undistributed earnings outside of the U.S. If these future earnings are repatriated to the U.S., or if the Company determines such earnings will be remitted in the foreseeable future, the Company

may

be required to accrue U.S. deferred taxes. The Company repatriated

$0,

$113,600,

and

$135,300

in cash from the Company’s subsidiary in Singapore in the

2020,

2019

and

2018

fiscal years, respectively.

XML

Note 10 - Geographic Regions

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Geographic Regions [Text Block]

1

0

.

GEOGRAPHIC REGIONS

The Company’s products are sold to customers in North America, Asia and Europe. The Company’s manufacturing facilities are located in Kansas. Sales are attributed to geographic regions based upon the region in which the materials were delivered to the customer. Sales between geographic regions were

not

significant.

Financial information regarding the Company’s continuing operations by geographic region is as follows:

	13 Weeks Ended
	June 2, 2019		May 27, 2018
Sales:
North America	$	14,190	$	9,233
Asia		252		132
Europe		508		1,028
Total sales	$	14,950	$	10,393

	June 2, 2019		March 3, 2019
Long-lived assets:
North America	$	21,093	$	19,372
Asia		1,775		1,546
Europe		-		-
Total long-lived assets	$	22,868	$	20,918

XML

Note 11 - Discontinued Operations

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

1

1

.

DISCONTINUED OPERATIONS

On

July 25, 2018,

the Company entered into a definitive agreement to sell its Electronics Business for

$145,000

in cash. The Company completed this transaction on

December 4, 2018.

The Company has classified the operating results of its Electronics Business, together with certain costs related to the transaction, as discontinued operations, net of tax, in the Consolidated Statements of Operations.

The following table shows the summary operating results of the discontinued operations:

	13 Weeks Ended (Unaudited)
	June 2,			May 27,
	2019			2018
Net sales	$	-		$	20,709
Cost of sales		-			15,053
Gross profit		-			5,656
Selling, general and administrative expenses		136			2,718
Restructuring charges		33			183
(Loss) earnings from discontinued operations		(169	)		2,755
Other income		-			-
(Loss) earnings from discontinued operations before income taxes		(169	)		2,755
Income tax (benefit) provision		(42	)		403
Net (loss) earnings from discontinued operations	$	(127	)	$	2,352

During the

2018

fiscal year, the Company consolidated its Nelco Products, Inc. Business Unit located in Fullerton, California and its Neltec, Inc. Business Unit located in Tempe, Arizona. The Company estimates the remaining pre-tax charge in connection with the consolidation to be approximately

$778,

which the Company expects to incur primarily during the fiscal year ending

February 28, 2021.

The following table sets forth the charges and accruals related to the consolidation:

	Accrual March 3, 2019		Current Period Charges		Cash Payments			Non-Cash Charges		Accrual June 2, 2019		Total Expense Accrued to Date		Total Expected Costs
Facility Lease Costs	$	1,324	$	13	$	(205	)	$	-	$	1,132	$	2,842	$	2,842
Severance Costs		-		-		-			-		-		1,081		1,081
Equipment Removal		-		-		-			-		-		-		700
Other		-		20		(20	)		-		-		799		877
Total Restructuring Charges	$	1,324	$	33	$	(225	)	$	-	$	1,132	$	4,722	$	5,500

XML

Note 12 - Contingencies

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

Contingencies Disclosure [Text Block]

1

2

.

CONTINGENCIES

Litigation

 

The Company is subject to a small number of immaterial proceedings, lawsuits and other claims related to environmental, employment, product and other matters. The Company is required to assess the likelihood of any adverse judgments or outcomes in these matters as well as potential ranges of probable losses. A determination of the amount of reserves required, if any, for these contingencies is made after careful analysis of each individual issue. The required reserves

may

change in the future due to new developments in each matter or changes in approach, such as a change in settlement strategy in dealing with these matters. The Company believes that the ultimate disposition of such proceedings, lawsuits and claims will

not

have a material adverse effect on the liquidity, capital resources, business, consolidated results of operations or financial position of the Company.

Environmental Contingencies

The Company and certain of its subsidiaries have been named by the Environmental Protection Agency (the “EPA”) or a comparable state agency under the Comprehensive Environmental Response, Compensation and Liability Act (the “Superfund Act”) or similar state law as potentially responsible parties in connection with alleged releases of hazardous substances at

three

sites.

Under the Superfund Act and similar state laws, all parties who

may

have contributed any waste to a hazardous waste disposal site or contaminated area identified by the EPA or comparable state agency

may

be jointly and severally liable for the cost of cleanup. Generally, these sites are locations at which numerous persons disposed of hazardous waste. In the case of the Company’s subsidiaries, generally the waste was removed from their manufacturing facilities and disposed at waste sites by various companies which contracted with the subsidiaries to provide waste disposal services. Neither the Company nor any of its subsidiaries have been accused of or charged with any wrongdoing or illegal acts in connection with any such sites. The Company believes it maintains an effective and comprehensive environmental compliance program.

The insurance carriers which provided general liability insurance coverage to the Company and its subsidiaries for the years during which the Company’s subsidiaries’ waste was disposed at these

three

sites have in the past reimbursed the Company and its subsidiaries for

100%

of their legal defense and remediation costs associated with

two

of these sites.

The Company does

not

record environmental liabilities and related legal expenses for which the Company believes that it and its subsidiaries have general liability insurance coverage for the years during which the Company’s subsidiaries’ waste was disposed at

two

sites for which certain subsidiaries of the Company have been named as potentially responsible parties. Pursuant to such general liability insurance coverage,

three

insurance carriers reimburse the Company and its subsidiaries for

100%

of the legal defense and remediation costs associated with the

two

sites.

Included in selling, general and administrative expenses are charges for actual expenditures and accruals, based on estimates, for certain environmental matters described above. The Company accrues estimated costs associated with known environmental matters, when such costs can be reasonably estimated and when the outcome appears probable. The Company believes that the ultimate disposition of known environmental matters will

not

have a material adverse effect on the Company’s results of operations, cash flows or financial position.

XML

Note 13 - Accounting Pronouncements

3 Months Ended

Jun. 02, 2019

Notes to Financial Statements

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

1

3

.

A

CCOUNT

I

NG

P

RONOUNCEMENTS

Recently

Adopted

In

February 2016,

the Financial Accounting Standards Board (“FASB”) issued ASU

No.

2016

-

02,

Leases

, which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a lease (

i.e.

, lessees and lessors). The new standard requires lessees to classify leases as either finance leases or operating leases and record a right-of-use asset and a lease liability for all leases with terms greater than

12

months regardless of their classification. An accounting policy election

may

be made to account for leases with a term of

12

months or less similar to existing guidance for operating leases today. ASU

No.

2016

-

02

supersedes the existing guidance on accounting for leases. In

July 2018,

the FASB issued ASU

No.

2018

-

11,

Leases (Topic

842

): Targeted Improvements

, which allows for an optional transition method for the adoption of Topic

842.

The

two

permitted transition methods are now the modified retrospective approach, which applies the new lease requirements at the beginning of the earliest period presented, and the optional transition method, which applies the new lease requirements through a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. ASU

2016

-

02

is effective for the Company’s fiscal year ending

March 1, 2020

and the interim periods within that year. The Company adopted this standard in the

first

quarter of the

2020

fiscal year using the optional transition method. The optional transition method enables the Company to adopt the new standard as of the beginning of the period of adoption and does

not

require restatement of prior period financial information. As a result, prior period financial information has

not

been recast and continues to be reported under the accounting guidance that was effective during those periods. The Company also elected the practical expedients that allow the Company to carry forward the historical lease classification. At adoption, the Company elected the following practical expedients: (

1

) the “package of practical expedients”, pursuant to which the Company did

not

need to reassess its prior conclusions about lease identification, lease classification and initial direct costs, (

2

) creation of an accounting policy for short-term leases resulting in lease payments being recorded as an expense on a straight-line basis over the lease term, and (

3

) to account separately for lease and non-lease components for all leases. The Company has established an inventory of existing leases and implemented a new process of evaluating the classification of each lease. The financial impact of the adoption of the new standard in the

2020

fiscal year increased total assets and total liabilities by approximately

$551.

The financial impact of the adoption primarily relates to the capitalization of right-of-use assets and recognition of lease liability related to operating leases. The Company has implemented changes to its processes and internal controls, as necessary, to meet the reporting and disclosure requirements of the new standard. See Note

5,

Leases, for additional information with respect to the impact of the adoption of the lease accounting guidance and the disclosures required by ASU

2016

-

02

and the related amendments.

In

February 2018,

the FASB issued ASU

No.

2018

-

02,

Income Statement - Reporting Comprehensive Income (Topic

220

): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income

. This ASU allows for reclassification of stranded tax effects resulting from U.S. Tax Reform from accumulated other comprehensive loss to retained earnings, but it does

not

require this reclassification. This ASU is effective for the Company’s fiscal year ending

March 1, 2020

and the interim periods within that year. The Company adopted this ASU in the

first

quarter of its

2020

fiscal year and elected to reclassify the stranded tax effects resulting from U.S. Tax Reform. As a result of that election, the adoption of ASU

2018

-

02

did

not

have an impact on the Company’s consolidated financial statements and disclosures.

Recently Issued

In

August 2018,

the FASB issued ASU

No.

2018

-

13,

Fair Value Measurement (Topic

820

): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement

. This ASU modifies the disclosure requirements for fair value measurements by removing the requirement to disclose the amount and reasons for transfers between Level

1

and Level

2

of the fair value hierarchy and the policy for timing of such transfers. This ASU expands the disclosure requirements for Level

3

fair value measurements, primarily focused on changes in unrealized gains and losses included in other comprehensive income (loss). This ASU is effective for the Company’s fiscal year ending

February 28, 2021

and for the interim periods within that year. Early adoption is permitted. ASU

2018

-

13

is generally required to be applied retrospectively to all periods presented upon their effective date with the exception of certain amendments, which should be applied prospectively to the most recent interim or annual period presented in the year of adoption. The Company is currently evaluating the potential impact of adopting this guidance on its consolidated financial statements and disclosures.

XML

Note 3 - Marketable Securities (Tables)

3 Months Ended

Jun. 02, 2019

Notes Tables

Debt Securities, Available-for-sale [Table Text Block]

	June 2, 2019
	Total		Level 1		Level 2		Level 3
U.S. Treasury and other government securities	$	89,111	$	89,111	$	-	$	-
U.S. corporate debt securities		11,979		11,979		-		-
Total marketable securities	$	101,090	$	101,090	$	-	$	-

	March 3, 2019
	Total		Level 1		Level 2		Level 3
U.S. Treasury and other government securities	$	68,718	$	68,718	$	-	$	-
U.S. corporate debt securities		11,899		11,899		-		-
Total marketable securities	$	80,617	$	80,617	$	-	$	-

Schedule of Available-for-sale Securities Reconciliation [Table Text Block]

	Amortized Cost Basis		Gross Unrealized Gains		Gross Unrealized Losses
June 2, 2019:
U.S. Treasury and other government securities	$	88,738	$	386	$	13
U.S. corporate debt securities		11,942		38		1
Total marketable securities	$	100,680	$	424	$	14
March 3, 2019:
U.S. Treasury and other government securities	$	68,727	$	44	$	53
U.S. corporate debt securities		11,924		7		32
Total marketable securities	$	80,651	$	51	$	85

Investments Classified by Contractual Maturity Date [Table Text Block]

Due in one year or less	$	16,500
Due after one year through five years		84,590
	$	101,090

XML

Note 4 - Inventories (Tables)

3 Months Ended

Jun. 02, 2019

Notes Tables

Schedule of Inventory, Current [Table Text Block]

	June 2,		March 3,
	2019		2019
Inventories:
Raw materials	$	4,025	$	4,556
Work-in-process		292		232
Finished goods		923		479
	$	5,240	$	5,267

XML

Note 5 - Leases (Tables)

3 Months Ended

Jun. 02, 2019

Notes Tables

Lessee, Operating Lease, Liability, Maturity [Table Text Block]

Fiscal Year:
2020	$	173
2021		61
2022		61
2023		61
2024		61
Thereafter		160
Total undiscounted operating lease payments		577
Less imputed interest		(115	)
Present value of operating lease payments	$	462

Schedule of Right-of-use Assets and Operating Lease Liabilities [Table Text Block]

Operating right-of-use assets	$	462
Operating lease liabilities		188
Long-term operating lease liabilities		274
Total operating lease liabilities	$	462

XML

Note 6 - Stock-based Compensation (Tables)

3 Months Ended

Jun. 02, 2019

Notes Tables

Share-based Payment Arrangement, Option, Activity [Table Text Block]

	Outstanding Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)
Balance, March 3, 2019		540,709		$	13.49
Granted		114,450			16.44
Exercised		(6,200	)		11.91
Terminated or expired		(66,750	)		18.83
Balance, June 2, 2019		582,209		$	13.47		4.19
Vested and exercisable, June 2, 2019		436,609		$	13.10		5.45

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Note 7 - Earnings Per Share (Tables)

3 Months Ended

Jun. 02, 2019

Notes Tables

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	13 Weeks Ended
	June 2, 2019			May 27, 2018
Net earnings - continuing operations	$	2,714		$	816
Net earnings - discontinued operations		(127	)		2,352
Net earnings	$	2,587		$	3,168
Weighted average common shares outstanding for basic EPS		20,492			20,242
Net effect of dilutive options		94			54
Weighted average shares outstanding for diluted EPS		20,586			20,296
Basic earnings per share - continuing operations	$	0.13		$	0.04
Basic earnings per share - discontinued operations		-			0.12
Basic earnings per share	$	0.13		$	0.16
Diluted earnings per share - continuing operations	$	0.13		$	0.04
Diluted earnings per share - discontinued operations		-			0.12
Diluted earnings per share	$	0.13		$	0.16

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Note 10 - Geographic Regions (Tables)

3 Months Ended

Jun. 02, 2019

Notes Tables

Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block]

	13 Weeks Ended
	June 2, 2019		May 27, 2018
Sales:
North America	$	14,190	$	9,233
Asia		252		132
Europe		508		1,028
Total sales	$	14,950	$	10,393

	June 2, 2019		March 3, 2019
Long-lived assets:
North America	$	21,093	$	19,372
Asia		1,775		1,546
Europe		-		-
Total long-lived assets	$	22,868	$	20,918

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Note 11 - Discontinued Operations (Tables)

3 Months Ended

Jun. 02, 2019

Notes Tables

Disposal Groups, Including Discontinued Operations [Table Text Block]

	13 Weeks Ended (Unaudited)
	June 2,			May 27,
	2019			2018
Net sales	$	-		$	20,709
Cost of sales		-			15,053
Gross profit		-			5,656
Selling, general and administrative expenses		136			2,718
Restructuring charges		33			183
(Loss) earnings from discontinued operations		(169	)		2,755
Other income		-			-
(Loss) earnings from discontinued operations before income taxes		(169	)		2,755
Income tax (benefit) provision		(42	)		403
Net (loss) earnings from discontinued operations	$	(127	)	$	2,352

Restructuring and Related Costs [Table Text Block]

	Accrual March 3, 2019		Current Period Charges		Cash Payments			Non-Cash Charges		Accrual June 2, 2019		Total Expense Accrued to Date		Total Expected Costs
Facility Lease Costs	$	1,324	$	13	$	(205	)	$	-	$	1,132	$	2,842	$	2,842
Severance Costs		-		-		-			-		-		1,081		1,081
Equipment Removal		-		-		-			-		-		-		700
Other		-		20		(20	)		-		-		799		877
Total Restructuring Charges	$	1,324	$	33	$	(225	)	$	-	$	1,132	$	4,722	$	5,500

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Note 1 - Consolidated Financial Statements (Details Textual) $ in Millions	Jul. 25, 2018 USD ($)
Discontinued Operations, Held-for-sale [Member] | Electronics Business [Member]
Disposal Group, Including Discontinued Operation, Consideration	$ 145

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Note 3 - Marketable Securities - Summary of Available-for-sale Securities (Details) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 03, 2019
Available-for-sale securities	$ 101,090	$ 80,617
Fair Value, Inputs, Level 1 [Member]
Available-for-sale securities	101,090	80,617
Fair Value, Inputs, Level 2 [Member]
Available-for-sale securities
Fair Value, Inputs, Level 3 [Member]
Available-for-sale securities
US Treasury and Government [Member]
Available-for-sale securities	89,111	68,718
US Treasury and Government [Member] | Fair Value, Inputs, Level 1 [Member]
Available-for-sale securities	89,111	68,718
US Treasury and Government [Member] | Fair Value, Inputs, Level 2 [Member]
Available-for-sale securities
US Treasury and Government [Member] | Fair Value, Inputs, Level 3 [Member]
Available-for-sale securities
Debt Security, Corporate, US [Member]
Available-for-sale securities	11,979	11,899
Debt Security, Corporate, US [Member] | Fair Value, Inputs, Level 1 [Member]
Available-for-sale securities	11,979	11,899
Debt Security, Corporate, US [Member] | Fair Value, Inputs, Level 2 [Member]
Available-for-sale securities
Debt Security, Corporate, US [Member] | Fair Value, Inputs, Level 3 [Member]
Available-for-sale securities

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Note 3 - Marketable Securities - Summary of Unrealized Gains and Losses on Available-for-sale Securities (Details) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 03, 2019
Amortized cost basis	$ 100,680	$ 80,651
Gross unrealized gains	424	51
Gross unrealized losses	14	85
US Treasury and Government [Member]
Amortized cost basis	88,738	68,727
Gross unrealized gains	386	44
Gross unrealized losses	13	53
Debt Security, Corporate, US [Member]
Amortized cost basis	11,942	11,924
Gross unrealized gains	38	7
Gross unrealized losses	$ 1	$ 32

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Note 3 - Marketable Securities - Estimated Fair Value of Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 03, 2019
Due in one year or less	$ 16,500
Due after one year through five years	84,590
	$ 101,090	$ 80,617

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Note 4 - Inventories - Summary of Inventories (Details) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 03, 2019
Raw materials	$ 4,025	$ 4,556
Work-in-process	292	232
Finished goods	923	479
	$ 5,240	$ 5,267	[1]

[1] The balance sheet at March 3, 2019 has been derived from the audited consolidated finacial statements at that date.

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Note 5 - Leases (Details Textual) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 02, 2019 USD ($)	Jun. 02, 2019 USD ($)	Dec. 31, 2018 ft²
Lessee, Operating Lease, Liability, Payments, Remainder of Fiscal Year	$ 173	$ 173
Lessee, Operating Lease, Liability, Payments, Due Year Two	61	$ 61
Operating Lease, Expense	97
Operating Lease, Payments	$ 95
Operating Lease, Weighted Average Remaining Lease Term	6 years	6 years
Additional Manufacturing Facility [Member]
Area of Land | ft²			90,000
Construction in Progress Expenditures Incurred but Not yet Paid		$ 20,000
Purchase Obligation, Total	$ 2,173	2,173
Accrued Liabilities [Member]
Lessee, Operating Lease, Liability, Payments, Remainder of Fiscal Year	588	588
Lessee, Operating Lease, Liability, Payments, Due Year Two	$ 463	$ 463
Minimum [Member]
Lessee, Operating Lease, Renewal Term	1 year	1 year
Maximum [Member]
Lessee, Operating Lease, Renewal Term	10 years	10 years

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Note 5 - Leases - Future Minimum Lease Payments (Details) $ in Thousands	Jun. 02, 2019 USD ($)
2020	$ 173
2021	61
2022	61
2023	61
2024	61
Thereafter	160
Total undiscounted operating lease payments	577
Less imputed interest	(115)
Present value of operating lease payments	$ 462

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Note 5 - Leases - Schedule of Right-of-use Assets and Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 03, 2019	[1]
Operating right-of-use assets	$ 462
Operating lease liabilities	188
Long-term operating lease liabilities	274
Total operating lease liabilities	$ 462

[1] The balance sheet at March 3, 2019 has been derived from the audited consolidated finacial statements at that date.

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Note 6 - Stock-based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended
	Jul. 24, 2018	Jun. 02, 2019
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross		114,450
The 2018 Stock Option Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized	800,000
Percentage of Stock Options, Exercisable One Year From Date of Grant	25.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	1 year
Percentage of Stock Options Exercisable On Each Succeeding Year from Date of Grant	25.00%
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
The 2018 Stock Option Plan [Member] | Directors and Certain of Employees [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross		114,450
Share-based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount		$ 454
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 3.97
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate		2.43%
The 2018 Stock Option Plan [Member] | Directors and Certain of Employees [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate		2.24%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate		30.40%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term		4 years 109 days
The 2018 Stock Option Plan [Member] | Directors and Certain of Employees [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate		2.26%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate		31.50%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term		5 years 292 days

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Note 6 - Stock-based Compensation - Option Activity (Details)	3 Months Ended
	Jun. 02, 2019 $ / shares shares
Outstanding options (in shares) | shares	540,709
Balance, weighted average exercise price (in dollars per share) | $ / shares	$ 13.49
Outstanding options, granted (in shares) | shares	114,450
Granted, weighted average exercise price (in dollars per share) | $ / shares	$ 16.44
Outstanding options, exercised (in shares) | shares	(6,200)
Exercised, weighted average exercise price (in dollars per share) | $ / shares	$ 11.91
Outstanding options, terminated or expired (in shares) | shares	(66,750)
Terminated or expired, weighted average exercise price (in dollars per share) | $ / shares	$ 18.83
Outstanding options (in shares) | shares	582,209
Balance, weighted average exercise price (in dollars per share) | $ / shares	$ 13.47
Balance, June 2, 2019 (Year)	4 years 69 days
Vested and exercisable (in shares) | shares	436,609
Vested and exercisable, weighted average exercise price (in dollars per share) | $ / shares	$ 13.10
Vested and exercisable, weighted average remaining contractual term (Year)	5 years 164 days

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Note 7 - Earnings Per Share (Details Textual) - shares	3 Months Ended
	Jun. 02, 2019	May 27, 2018
Share-based Payment Arrangement, Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	191,000	544,000

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Note 7 - Earnings Per Share - Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Jun. 02, 2019	May 27, 2018
Net earnings - continuing operations	$ 2,714	$ 816
Net earnings - discontinued operations	(127)	2,352
Net earnings	$ 2,587	$ 3,168
Weighted average common shares outstanding for basic EPS (in shares)	20,492	20,242
Net effect of dilutive options (in shares)	94	54
Weighted average shares outstanding for diluted EPS (in shares)	20,586	20,296
Basic earnings per share - continuing operations (in dollars per share)	$ 0.13	$ 0.04
Basic earnings per share - discontinued operations (in dollars per share)		0.12
Basic earnings per share (in dollars per share)	0.13	0.16
Diluted earnings per share - continuing operations (in dollars per share)	0.13	0.04
Diluted earnings per share - discontinued operations (in dollars per share)		0.12
Diluted earnings per share (in dollars per share)	$ 0.13	$ 0.16

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Note 8 - Shareholders' Equity (Details Textual) - USD ($) $ in Thousands		3 Months Ended
	Mar. 10, 2016	Jun. 02, 2019	May 27, 2018	Jul. 03, 2019	Jan. 08, 2015	Jan. 07, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period		6,200
Proceeds from Sale of Treasury Stock, Stock Options Exercised		$ 71
APIC, Share-based Payment Arrangement, Increase for Cost Recognition, Total		$ 68
Stock Repurchase Program, Number of Shares Authorized to be Repurchased					1,250,000
Stock Repurchase Program, Percentage of Outstanding Shares Authorized to be Repurchased						6.00%
Common Stock, Shares, Outstanding, Ending Balance						20,945,634
Stock Repurchase Program, Number of Additional Shares Authorized to be Repurchased	1,000,000
Stock Repurchased During Period, Shares		0	0
Subsequent Event [Member]
Stock Repurchase Program, Percentage of Outstanding Shares Authorized to be Repurchased				7.50%
Common Stock, Shares, Outstanding, Ending Balance				20,492,377
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased				1,531,412
Share-based Payment Arrangement, Option [Member]
Share-based Payment Arrangement, Expense, after Tax		$ 124

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Note 9 - Income Taxes (Details Textual) - USD ($)	3 Months Ended		12 Months Ended
	Jun. 02, 2019	May 27, 2018	Mar. 03, 2019	Feb. 25, 2018
Income Tax Expense (Benefit), Total	$ 1,116,000	$ 275,000
Tax Adjustments, Settlements, and Unusual Provisions	$ 153,000
Effective Income Tax Rate Reconciliation, Percent, Total	29.10%	25.20%
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	21.00%	21.00%
Undistributed Earnings, Basic, Total	$ 25,000,000
Foreign Earnings Repatriated	$ 0		$ 113,600,000	$ 135,300,000

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Note 10 - Geographic Regions - Financial Information by Geographic Region (Details) - USD ($) $ in Thousands	3 Months Ended
	Jun. 02, 2019	May 27, 2018	Mar. 03, 2018
Net sales	$ 14,950	$ 10,393
Long-lived assets	22,868		$ 20,918
North America [Member]
Net sales	14,190	9,233
Long-lived assets	21,093		19,372
Asia [Member]
Net sales	252	132
Long-lived assets	1,775		1,546
Europe [Member]
Net sales	508	$ 1,028
Long-lived assets

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Note 11 - Discontinued Operations (Details Textual) - USD ($) $ in Thousands	Dec. 04, 2018	Feb. 25, 2018
Consolidation of Nelco Products, Inc. and Neltec, Inc. [Member]
Restructuring and Related Cost, Expected Cost Remaining		$ 778
Electronics Business [Member] | Discontinued Operations, Disposed of by Sale [Member]
Disposal Group, Including Discontinued Operation, Consideration	$ 145,000

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Note 11 - Discontinued Operations - Summary for Discontinued Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Jun. 02, 2019	May 27, 2018
Net (loss) earnings from discontinued operations	$ (127)	$ 2,352
Electronics Business [Member] | Discontinued Operations, Held-for-sale [Member]
Net sales		20,709
Cost of sales		15,053
Gross profit		5,656
Selling, general and administrative expenses	136	2,718
Restructuring charges	33	183
(Loss) earnings from discontinued operations	(169)	2,755
Other income
(Loss) earnings from discontinued operations before income taxes	(169)	2,755
Income tax (benefit) provision	(42)	403
Net (loss) earnings from discontinued operations	$ (127)	$ 2,352

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Note 11 - Discontinued Operations - Restructuring Charges (Details) - Consolidation of Nelco Products, Inc. and Neltec, Inc. [Member] $ in Thousands	3 Months Ended
	Jun. 02, 2019 USD ($)
Accrued, Beginning Balance	$ 1,324
Current Period Charges	33
Cash Payments	(225)
Non-Cash Charges
Accrued, Ending Balance	1,132
Total Costs Accrued to Date	4,722
Total Expected Costs	5,500
Facility Lease Costs [Member]
Accrued, Beginning Balance	1,324
Current Period Charges	13
Cash Payments	(205)
Non-Cash Charges
Accrued, Ending Balance	1,132
Total Costs Accrued to Date	2,842
Total Expected Costs	2,842
Employee Severance [Member]
Accrued, Beginning Balance
Current Period Charges
Cash Payments
Non-Cash Charges
Accrued, Ending Balance
Total Costs Accrued to Date	1,081
Total Expected Costs	1,081
Equipment Removal [Member]
Accrued, Beginning Balance
Current Period Charges
Cash Payments
Non-Cash Charges
Accrued, Ending Balance
Total Costs Accrued to Date
Total Expected Costs	700
Other Restructuring [Member]
Accrued, Beginning Balance
Current Period Charges	20
Cash Payments	(20)
Non-Cash Charges
Accrued, Ending Balance
Total Costs Accrued to Date	799
Total Expected Costs	$ 877

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Note 12 - Contingencies (Details Textual) $ in Thousands	3 Months Ended
	Jun. 02, 2019 USD ($)
Number of Sites of Company or Subsidiaries That Have Been Named for Potential Environmental Remediation Liability	3
Percentage of Legal Defense and Remediation Costs Associated with Sites Reimbursed by Insurance Carriers	100.00%
Number of Units Covered Under General Liability Insurance Coverage	2
Accrual for Environmental Loss Contingencies, Ending Balance	$ 0
Number of Insurance Carriers	3

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Note 13 - Accounting Pronouncements (Details Textual) - USD ($) $ in Thousands	Jun. 02, 2019	Mar. 04, 2019	Mar. 03, 2019	[1]
Assets, Total	$ 189,675		$ 188,851
Liabilities, Total	$ 29,585		$ 29,840
Accounting Standards Update 2016-02 [Member]
Assets, Total		$ 551
Liabilities, Total		$ 551

[1] The balance sheet at March 3, 2019 has been derived from the audited consolidated finacial statements at that date.