PARK AEROSPACE CORP Q3 FY2026 earnings call

• Erie Business Partner Agreement: Discussed impact on quarters, with zero sales of the fabric in Q3 but some sales of materials manufactured with C2B product.
• Total miss shipments: Approximately 740,000 in Q3, caused by international freight, supply chain, and customer spec/engineering issues.
• Top five customers: Highlighted companies like those related to 737 MAX, Valkyrie, PAC three, Airbus H20 neo, and Sikorsky.
• GE Aerospace programs: Talked about engine orders, market share of CFM LEAP engine, delivery rates, and updates on various engine programs.
• Missile systems: Unprecedented demand for missile systems, Pentagon pushing for ramp-up of production, Park's role in Patriot missile system with sole source qualification for specialty ablative materials.
• New composite materials manufacturing plant: Planning to build a 120,000 square feet plant to double composite materials manufacturing capacity, aiming for completion in the second half of 2027 and operational by the second half of 2028, with an estimated capital budget of $50,000,000.
• Public offering: Filed an S-3 registration statement for a $50,000,000 at-the-market public offering to fund plant expansion and exploit opportunities.

In the third quarter, Park Aerospace Corp. reported sales of $17,333,000. Gross profit was $5,003,000 with a gross margin of 34.1%. Adjusted EBITDA was $4,228,000 with an adjusted EBITDA margin of 24.4%. For GE Aerospace jet engine programs, Q3 sales were $7,500,000. Forecasts for Q4 were approximately $7.25 million to $8.75 million, and for the fiscal year 2026, it was projected to be $29,000,000 to $29,500,000.

• Q4 sales forecast: Approximately $23.5 million to $24.5 million, with EBITDA of 4.75 to 5.25.
• FY2026 sales forecast: $72.5 million to $75.5 million, with EBITDA related to the forecast.
• GE Aerospace programs: Forecasts for Q4 and FY2026, with expectations of aggressive growth in the next two to three years.
• New plant impact: Expected to double composite materials manufacturing capacity and support long-term business and sales outlooks.

• Supply chain issues: Affecting industry, with limitations impacting sales and production.
• Tariffs: Minimal impact in Q3 but potential future changes.
• Comac delivery target: Comac expected to fall short of delivery targets for the C919, caused by supply chain issues.
• Missile program uncertainties: Uncertainties in the ramp-up of missile programs and potential variations in program success.

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