Park Aerospace Q1 2026 Earnings Report

Park Aerospace EPS Results

• Actual EPS: $0.10
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Park Aerospace Revenue Results

• Actual Revenue: $15.40 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Park Aerospace Announcement Details

• Quarter: Q1 2026
• Date: 7/15/2025
• Time: After Market Closes
• Conference Call Date: Tuesday, July 15, 2025
• Conference Call Time: 5:00PM ET

Park Aerospace (NYSE:PKE) (NYSE:PKE) is a specialty materials company that designs, manufactures and supplies high-performance products for the aerospace, defense and industrial markets. The company’s product portfolio includes advanced seals and gaskets, thermal insulation materials, high-temperature composites and engineered films that withstand extreme environmental conditions. Park Aerospace serves as a critical supplier to original equipment manufacturers, maintenance repair and overhaul facilities, and aftermarket distributors worldwide.

The company’s core offerings encompass silicone- and fluoropolymer-based resilient materials, which are used to seal, insulate and protect aircraft engines, fuel systems, hydraulic systems and environmental control assemblies. In addition, Park Aerospace produces thermal acoustic insulation blankets, ablative composites and specialty coatings that enhance engine performance and extend component life. These materials are formulated to meet stringent industry standards for temperature resistance, chemical compatibility and flame retardancy.

Park Aerospace operates manufacturing facilities in North America, Europe and Asia, enabling the company to support a global customer base. Its international footprint includes state-of-the-art production plants in New York, Michigan, the United Kingdom and China. Through regional sales offices and technical support centers, Park Aerospace collaborates closely with customers on product development, qualification testing and aftermarket service, ensuring timely delivery and compliance with regulatory requirements.

Founded in 1954, Park Aerospace has evolved from a small sealing specialist into a diversified provider of engineered materials. Over the decades, the company has expanded its capabilities through internal research and development initiatives as well as strategic acquisitions. Today, Park Aerospace is led by President and Chief Executive Officer William R. Ziebell along with a senior management team boasting deep expertise in materials science, aerospace engineering and global operations. Together, they guide the company’s growth strategy and innovation pipeline to address the evolving needs of the aerospace and defense industries.

Park Aerospace Q1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Park reported Q1 sales of $15.4 million with a gross margin over 30% and adjusted EBITDA of $3 million (19.2%), landing at the top of its estimate ranges.
• Neutral Sentiment: The company ended Q1 with $65.6 million in cash, zero long-term debt, completed a $2.2 million share buyback, and made a $1.5 million advance payment to a key partner.
• Positive Sentiment: Park’s “first juggernaut” GE Aerospace engine programs drive a $61 million sales opportunity, while its “new juggernaut” supplies of ablation materials for Patriot and Arrow missile defense systems face urgent replenishment needs, including up to $40 million in proposed fabric orders.
• Negative Sentiment: Margins remain under pressure from an underutilized new manufacturing facility and associated ramp-up costs, prompting a planned plant expansion with an estimated $35 million capital budget.
• Positive Sentiment: The C2B fabric recall is expected to be approved imminently, unlocking thousands of pounds of material held at customers and clearing the way for resumed prepreg production.

Presentation

[Operator]

Good afternoon. My name is Paul, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Park Aerospace Corp. First Quarter Fiscal Year twenty twenty six Earnings Release Conference Call and Investor Presentation. All lines have been placed on mute to prevent any background noise.

[Operator]

After the speakers' remarks, there will be a question and answer Thank you. At this time, I will turn the call over to mister Brian Shore, chairman and chief executive officer. Mister Shore, you may begin your conference.

[Brian Shore, Chairman & CEO at Park Aerospace]

Thank you, operator. This is Brian. Welcome all to the Park Aerospace Corp fiscal twenty six q one investor conference call. I have with me Mark Escoball, president and COO. We announced our, first quarter earnings right after the close.

[Brian Shore, Chairman & CEO at Park Aerospace]

If you look at the news release, you'll see there's link information as to how to access the presentation that we're about to go through. The presentation also can be found on our website. You want to take a look at that in order to make this call more meaningful. Just a little quick comment before we get started. It's only been two months since our Q4 presentation, and as a result, some items are just carried over from the Q4 presentation for context and cohesiveness, but we may just skip over some of those items or at least skim over, some of the items that we just covered two months ago just for purposes of keeping the presentation moving in of brevity.

[Brian Shore, Chairman & CEO at Park Aerospace]

If we do skip over something that you wanna discuss in more detail though, please just ask us questions about it at the end. And we'll try to highlight also what's new, even if there's a slide that has a lot of old stuff and able to just pick out one item that might be new. And when we get there, you'll probably realize that they're important new items toward the end of the presentation. When we're done, Mark and I will be happy to answer any questions you might have. So when we proceed, when we go into slide two, that's our forward looking disclaimer language.

[Brian Shore, Chairman & CEO at Park Aerospace]

We're not going to go through it or read it for you, but if you have any questions about it, please let us know. Slide three, our table of contents. Slide one starts our Q1 investor presentation. And then also within Appendix one at the back of the supplementary financial information. We're not going to review that during the call, but if you have any questions about it please let us know.

[Brian Shore, Chairman & CEO at Park Aerospace]

As has become our kind of pattern of late, we featured something about the James Webb Space Telescope in our table of contents slide. As you probably know, James Webb Space Telescope was produced with 18 of our PARCC proprietary Sigma struts. We're very pleased and delighted about that. What do we have here? We have a bullet cluster with dark matter, the dark matter is in blue.

[Brian Shore, Chairman & CEO at Park Aerospace]

This is enhanced because the dark matter, you can't see it, it's invisible. I'm just on the right hand side, let's explain that. Dark matter is an invisible and hypothetical, kind of strange hypothetical form of matter. This is way beyond my, you know, pay scale to understand what that even means, which does not interact with light or other electromagnetic radiation. So you can't really see it, that's why they're in those pictures and enhanced with the blue.

[Brian Shore, Chairman & CEO at Park Aerospace]

Dark matter is a mystery of the universe which cannot be explained by Einstein's general relativity or anything else known to mankind. It's just incredible what James Webb has discovered so far. It's just amazing, you know, thinking about all the things that we thought we knew, we thought we understood about the universe, but maybe we don't. You know, some people say the universe is unfathomable and maybe they're right. Anyway, it's such a privilege and honor for us to be associated with the James Webb.

[Brian Shore, Chairman & CEO at Park Aerospace]

Okay, let's change gears and go to more mundane things. Slide four is our quarterly results. You go to the right hand column, Q1 which we just reported, sales $15,400,000 in gross profit, 4,718,000 gross margin, 3.6%. We're happy about that, not where we want to be. We'd like to be higher, but it's just nice be nice to be over 30%.

[Brian Shore, Chairman & CEO at Park Aerospace]

And we'll explain how we got there. There's maybe three different factors that kind of affected our ability to to, get our gross margins up above 30%. Adjusted EBITDA, just a little tiny less than $3,000,000 and our EBITDA margin 19.2%. What did we say about Q1? Our Q1 during our Q4 investor call, we had set our sales estimate.

[Brian Shore, Chairman & CEO at Park Aerospace]

Estimate is 15,000,000 to $16,000,000 so we came in kind of middle of that range. Adjusted EBITDA estimate 2.5 to three, so we came in I guess pretty much at the top of that range. Last quarter we talked about what these estimates mean, what they don't mean, and I don't want to go into it again unless you want me to. But basically these are not guidance where we give you a number where we plan to kind of set ourselves up to beat the number. When we give you these estimates we're saying to you this is what we think is going to happen.

[Brian Shore, Chairman & CEO at Park Aerospace]

Okay, let's go on to slide five so don't belabor that too much. And what I'd like to do, if you don't mind, is let's go to slide six. We'll jump around here a little bit. The second bullet item on slide six, there's significant ongoing expenses related to operating a new manufacturing factory manufacturing facility, sorry. And that's why we're pleased to have our margins over 30% because this is a drag.

[Brian Shore, Chairman & CEO at Park Aerospace]

This factory is under utilized and there's significant costs that's going through our P and L that drags down our margins including our gross margins. So that's one factor, I said there were three. Let's go back to slide five. Ariane Group, we discussed this many times, our business partner agreement under which we are the exclusive distributor for Ray Carb, C2B fabric that's used for ablative composite materials for advanced missile systems. But remember, so actually the other two factors aren't positive, they're just lack of negatives.

[Brian Shore, Chairman & CEO at Park Aerospace]

Our couple quarters ago we had, actually last quarter we had $4,400,000 sales of fabric during that quarter. And that really brings our margin down a lot because we sell the fabric at a small markup. Ultimately when we turn the fabric into a composite material that's where the margins really are powerful. Last quarter in Q1 we had $1,100,000 sales of the fabric and $480,000 of the materials made with the fabric. And that's kind of more of a normal ratio so it isn't really a big drag on our that wasn't really much of a drag on our Q1 earnings.

[Brian Shore, Chairman & CEO at Park Aerospace]

And then I'll get back to the recall in a second when we skip over to slide six again, production versus sales. This is another factor that had negatively affected our margins a couple of quarters ago where our production was much lower than our sales. We call it SVP. But in Q1 they were relatively nicely matched, which is what we want. We want our production and sales to be relatively nicely matched.

[Brian Shore, Chairman & CEO at Park Aerospace]

It's not really a factor, so it's not that these two things were positive, it's just a lack of negatives in terms of the impact on Q1. That's how we're able to, I guess, get our margins above the 30% number. But let's go back to slide five, sorry about that. I'm probably making it little dizzy here. Recall of Mark, maybe you help us with that.

[Brian Shore, Chairman & CEO at Park Aerospace]

One of Park's key customers of c two b fabric. We've talked about this quite a bit in the last couple quarters. What's the status of the recall, Mark?

[Mark Esquivel, President & COO at Park Aerospace]

The recall, it's I think last time I said it would be soon, on the last call two months ago, but it's still not done. But last week, I did reach out to my contacts at, the customer, and they said it's imminent, which is better than it it'll be a few weeks out. I think, if I look at it, there's no guarantees, but I would say the approval will happen in the next couple of weeks. And really the reality is it must happen. We're single source position on the program.

[Mark Esquivel, President & COO at Park Aerospace]

I think as Brian will talk later in the presentation, know, this this program is gonna grow significantly. All indications are it's gonna grow significantly just based on, you know, all the information the customer and, you know, the information held in the public. So, like I said, Brian will cover that in the later slides.

[Brian Shore, Chairman & CEO at Park Aerospace]

Yeah. There must be enormous pressure to get this done now. I mean, it's no joke anymore. Enormous pressure. And Mark and I were just talking about should we talk tell you about how many thousands of pounds of this C2B fabric that we're storing with customers?

[Brian Shore, Chairman & CEO at Park Aerospace]

And we thought maybe we shouldn't, it's too sensitive. But it's a we're storing a lot of this product that we sold to customers already. So there's a lot of pent up need for the prepreg material. I mean, the customers can't do anything with the fabric. That's for us to produce the material with.

[Brian Shore, Chairman & CEO at Park Aerospace]

Let's go back to slide six. Total miss shipments, we tell you every quarter 275,000. That's up a little bit from Q4 unfortunately caused by surprise, surprise, international shipments, other miscellaneous issues. Impact of tariffs and tariffs related costs on Q1, very minimal, less than a few thousand bucks let's say. Later on in the presentation we'll talk a little bit more about what we might expect from tariffs in the future.

[Brian Shore, Chairman & CEO at Park Aerospace]

Let's go on to slide seven. This is a slide we do every quarter. Our top five customers in alphabetical order. These are just rounding up to usual suspects. I mean, all these customers often show up in our top five.

[Brian Shore, Chairman & CEO at Park Aerospace]

So just to make it simple, the Patriot Missile, so we'll be talking about that one. That's AE this time. Kratos obviously is the Kratos is obviously Kratos. That's I think a photo of a loyal wingman operation actually. $7.87 would be GEKN, and, that's all we really wanna talk about.

[Brian Shore, Chairman & CEO at Park Aerospace]

The Middle River air structure, I think Donna decided that we we feature so many GE programs photos that we didn't need to provide you with a photo at this time. Let's go on to slide eight, our pie charts. I always like these things, but you could see the '22, '23, '24, '25, and the '26, you know, it's fairly consistent. 'twenty one was quite different. That was the pandemic year where commercial aircraft was very severely impacted by the pandemic.

[Brian Shore, Chairman & CEO at Park Aerospace]

Okay, let's go on to slide nine. Elena does this Parkla's niche military aerospace programs for us every quarter. And it's getting to be more and more difficult for us to provide much detailed information about these defense programs, they're so sensitive. The pie chart's interesting though. Radomes, rocket nozzles, drones, those are really niche kind of markets for us.

[Brian Shore, Chairman & CEO at Park Aerospace]

But even for us, aircraft structures are niche. We don't really like commoditized stuff too much. And I guess the only thing maybe we can comment on which is interesting is this AAM and for OREO air to air. That goes back to the forties, you know, it's one of the original air to air missile systems, but it's been repurposed for other purposes so that's why it's on our list here of programs. These are all programs we're working on.

[Brian Shore, Chairman & CEO at Park Aerospace]

We don't know patients have done and stuff that things are not working on. A funny little anecdote, at least for me, this is produced by the Glen Martin Company. What's very interesting about that is that we talk so much about MRAS, Middle River, which used to be GE Aerospace. The factory that where MRAS is located in the Baltimore area is the old Glen Martin factory. So I've been in that factory, I don't even know, maybe 50 times.

[Brian Shore, Chairman & CEO at Park Aerospace]

A lot of history there. I think Mark has been there as well. I think that's all we'll probably say about slide nine right now. I'm gonna go to slide 10. So this is the first slide where we're just not really gonna say very much because it was covered.

[Brian Shore, Chairman & CEO at Park Aerospace]

We have it in every quarter. It was covered in our Q4. Just for anybody new, really quickly, the little secret here is that you say, well, what is why are we in all these GE Aviation programs, sorry, GE Aerospace programs? All these engines are GE Aerospace engines. And the secret there is that Middle River Aerostructure Systems was sub of GE Aerospace for many, many years.

[Brian Shore, Chairman & CEO at Park Aerospace]

And when we got on these programs, MRAS, we call it, was a sub of GE Aerospace. And about five years ago GE sold MRAS to ST Engineering, which is a Singapore company, but these programs continue this year. GE Aerospace programs continue if you're trying to figure out the mystery there. Slide 11, I think nothing is new here. So again, if you want us to go back and revisit any of these items, just ask questions or ring calls later if you want.

[Brian Shore, Chairman & CEO at Park Aerospace]

But just for purposes of not kind of being totally repetitive, we're we're gonna skip over things that we covered in q four. Last item, life of program, we did cover this in q four, but the update is still under negotiation. The ball is in their court. They have everything we need, as I think I mentioned. It's okay with us either way whether we stay with our current LTA or go to the LIFA program.

[Brian Shore, Chairman & CEO at Park Aerospace]

LIFA program was requested by MRAS and SDE, something they want. And I don't know how to say this but I think they very much want it but MRAS is very consumed with other issues right now and that's maybe preventing them from getting to this. All their suppliers get hundreds, hundreds, hundreds, you know what I'm getting at. Some of the suppliers cause a lot of difficulty and it's not funny, it's very challenging. So it's a little bit distracting for those folks right now.

[Brian Shore, Chairman & CEO at Park Aerospace]

Let's go on to slide 12, update on GE or space gen user programs. Pretty much everything here was in Q4. I just want to mention that we often refer to Aeroengine News as our bible. It used to be a monthly but now it's a quarterly, so there isn't even an Aeroengine News update since we announced Q4 on, whatever that was, May 15. The only new item here is the first six months of '25, 39 per month.

[Brian Shore, Chairman & CEO at Park Aerospace]

I wouldn't read too much into that because normally the first half of the year is a little slow. My guess is probably no better than anybody else's, but I'm going to guess it will be in the low 50s this year, somewhere between 50 and 55. That's a guess. I don't have any inside information at all. And I think I mentioned this to you last time, but the first six months there were a lot of engines were going to aftermarket, but the second six months of the year for new airplanes.

[Brian Shore, Chairman & CEO at Park Aerospace]

They also have Airbus unfortunately a lot of kites they built. The last item is the key one, Airbus is targeting 75 airplanes per month. Let's go on slide 13. Approved engines, this is all exactly, this is from Q4 with no changes. Like I said, there's been no update to the Aeroengine news.

[Brian Shore, Chairman & CEO at Park Aerospace]

So, we talked about, you know, the market share of LEAP as compared to the Pratt and how many LEAP-1A engine orders there are, quite considerable I would say. Slide 14, update on the XLR, sorry, the 21 XLR, that's a variant of the a three twenty family, a neo family, which is what we've just been talking about. The new item on July 5, '25, Air Asia Inc. A $12,300,000,000 agreement for up to 70 A321XLR aircraft. That's a lot of money, a lot of airplanes, I would say.

[Brian Shore, Chairman & CEO at Park Aerospace]

This is an important program because it has really unique capability in terms of fuel economy, range, and payload. So let's go on to slide 15. The nine nineteen, the Comek airplanes, let's see what's new here. The second item, they plan to achieve Comek production rate of two hundred nine nineteen aircraft per year. That's pretty good.

[Brian Shore, Chairman & CEO at Park Aerospace]

It's not 900, which is the H20 Neo, 75 times 12 is not 900. This is not nearly 900, but it's still pretty good. We'll take it. Trade issues. US has reported lift or demand NG aerospace export license for the LEAP-1C engines which are used on this airplane.

[Brian Shore, Chairman & CEO at Park Aerospace]

Let's go on to slide 16 I think it is. COMAK's still with the COMAK family. The COMAK nine zero nine is their regional jet using a different kind of GE engine. And again, the new item is US has reported lifted van on GE aerospace export license for that CF 34-10A engine which is used on this regional jet. 777X, what's new here?

[Brian Shore, Chairman & CEO at Park Aerospace]

Okay, first item, we updated numbers over 1,400 flights and 4,000 in the test program. This item, second item is new. According to Boeing, the 777X program is on track for certification this year, wow, and entry into service in 2016. Think they're hedging their bets. And I just saw this recently, maybe the end of this year, maybe next year for certification.

[Brian Shore, Chairman & CEO at Park Aerospace]

Now they're saying this year, so that's impressive, you know, how much they've gotten their act together. I mean if they deliver on that. Five forty one orders, so that's nice. Let's go on to slide 17. Some of the numbers here, 6,200,000 Q1, these are GE Aerospace jet engine program sales history and forecast.

[Brian Shore, Chairman & CEO at Park Aerospace]

Q1 6,200,000 and we had forecasted in our Q4 presentation 5.2 to six to 5.6, so this came a little bit higher than that. Interesting thing to think about, 24,700,000.0 for all 25. If we read ahead, you're probably familiar with the juggernaut 61,000,000, so that's quite a bit of incremental sales for GE engine programs. The forecast down in the bottom right here are our q two forecast 6.7 to 7,200,000.0, and we're sticking with the 28 to $32,000,000 number for fiscal twenty six even though, you know, if you look at q one and q two, we're getting off to a slow start. But as I mentioned, I'll remind you that the fiscal twenty six forecast is based upon input we've received from the customer.

[Brian Shore, Chairman & CEO at Park Aerospace]

Let's go on to slide 18. Parks' financial performance history forecast estimates. The top half we already covered. The bottom half, let's go right to the forecast. Q2 we're estimating 15,000,000 to $16,000,000 of sales, 3,000,000 to $3,400,000 of EBITDA.

[Brian Shore, Chairman & CEO at Park Aerospace]

And I think that pretty much covers that slide. Let's go on to slide 19. This slide is exactly the slide that was in Q4 presentation, historical fiscal year results, so we're not going to discuss it. Again, and any of things we're skipping over, we're skimming over. If you want us to go back and discuss these again, let us know when we get to the question portion of the call or call us afterwards when we happen to go over these things

[Brian Shore, Chairman & CEO at Park Aerospace]

But we already covered this slide in our prior presentation slide. So again, I just want to explain we're including these slides for context and cohesiveness so that the presentation holds together. But when we covered things before we're just not going to go over it again, well before meeting in Q4, very recently just two months ago. Slide 20, general park updates. Again, most of this stuff was already covered.

[Brian Shore, Chairman & CEO at Park Aerospace]

We covered the Aeriean Group, the new agreement under which we're going to advance AREAN 4,587,000 Euro against future purchases. And the last item is important because in our Q1 we advanced AREAN €1,376,000. That's approximately 1,500,000.0 based on exchange rate to time. Let's keep that 1,500,000.0 number ahead and get back to that. Slide 21.

[Brian Shore, Chairman & CEO at Park Aerospace]

And the purpose agreement, we'll, revisit this toward the end of the presentation. Very important, timing is very important. The purchase agreement for the $5,000,000 investment to help Aireon increase their capacity for C2B fabric manufacturing. Next item, lighting strike, we recovered that, so we don't want to cover that again. And the next item, LTA, which is aerospace, we covered that, so we won't go over that again.

[Brian Shore, Chairman & CEO at Park Aerospace]

And last item, these discussions continue with two Asian industrial developments relating to an Asian manufacturing joint venture with Park. I think our guys were supposed to be in Asia now actually, But things came up so I think that trip is now gonna be in September. But these people have been to visit us. We've been to visit them already so these discussions are somewhat advanced at this point. Slide 22, more updates, current MRAS scorecard, 100, 100, 100.

[Brian Shore, Chairman & CEO at Park Aerospace]

What is that MRAS love worth the part? I don't know how to quantify it, it's just worth a whole lot. Really our objective is for customers to love us. And MRAS is not the only customer who loves us, that's for sure. And making customers love us is central to our park egg strategy.

[Brian Shore, Chairman & CEO at Park Aerospace]

I think we talked a little bit about this. We never went into the details about it, but we mentioned our strategy, this egg strategy. Making customers love us is actually central to that strategy. Tariffs, international trade issues, what's the impact going forward? Okay, Mark, back to you.

[Brian Shore, Chairman & CEO at Park Aerospace]

Can you help us get some understanding of where we're going with tariffs going forward?

[Mark Esquivel, President & COO at Park Aerospace]

Thanks. Get the easy ones. Tariffs, so I think I mentioned last time, yeah, I mentioned last time there's been a little or no impact to our business as far as tariffs. We did get ahead of it. We several months before they started coming in, we notified customers we would pass these costs along.

[Mark Esquivel, President & COO at Park Aerospace]

But fortunately for us, there's been little impact as far as even getting tariffs from customers. I'm not saying suppliers, I'm not saying we're not seeing them, but the ones we have seen had either been not significant or they've been passed on to the customer. So from our perspective to our business, there's just really no impact. But if you watch the news like we all do, things are still dynamic. They're still talking about 30% tariff in some countries.

[Mark Esquivel, President & COO at Park Aerospace]

So we're watching that. But for now and we think in the short term, near term, we don't see any issue with our business from a tariff perspective. If it's something changed, I don't know, but I think we're pretty well covered at this point. So maybe by the next quarter there'll be another update, hopefully the update is the same. So we're not seeing any impact in the business going forward.

[Brian Shore, Chairman & CEO at Park Aerospace]

Thanks, Mor. Yeah, tariffs are a hot topic these days. Any questions about it, just let us know. Let's go on to slide 23. Our share buyback, this is not really an update except confirming that in Q1 we purchased $2,165,000 worth of stock.

[Brian Shore, Chairman & CEO at Park Aerospace]

Let's put that number in our little memory. We'll go back to that a little later on as well. We haven't purchased anything in Q2, and my guess is we probably won't be doing that. Let's go on to slide 24. Oh, here we go.

[Brian Shore, Chairman & CEO at Park Aerospace]

Okay. We can call these numbers. Park's balance sheet cash and incredible cash dividend history. We have zero long term debt. We reported $65,600,000 in cash and marketable securities at the end of Q1.

[Brian Shore, Chairman & CEO at Park Aerospace]

Now, at the end of Q4 it was 68,800,000.0 so that's a difference of 3,200,000.0, right? But there are two things we just talked about which are unusual expenditures in Q1. One was about $1,500,000 to Aireon, the other one was $2,200,000 buyback, that's 3,700,000.0. So if you just those two things combined explain the difference, the drop in cash between Q4 and Q1. And one more thing I've to remind you about.

[Brian Shore, Chairman & CEO at Park Aerospace]

Remember we used to talk for many quarters about those transition tax installment payments? Well, last installment, which is $4,900,000 is Q2. It actually was already paid in June, but you'll see that show up in our Q2 cash, it's about $5,000,000 out the window. That was our last installment tax payment. That relates to repatriation.

[Brian Shore, Chairman & CEO at Park Aerospace]

We talked about that many times, I'm going include that again. Forty years of dividends and over $600,000,000 of dividends paid so far. Let's go on to slide 25. Okay, this is a no change financial outlook for GE Aerospace Engineering Programs to Juggernaut. So these three slides, change, and I don't think we're going go through the details again.

[Brian Shore, Chairman & CEO at Park Aerospace]

The timing, we don't know, but it's coming. It can't be stopped. Better be ready. Slide 26. There's that $61,000,000 number we're talking about.

[Brian Shore, Chairman & CEO at Park Aerospace]

We've gone through the math many times. The math is straightforward as far as we're concerned. It's pretty transparent also because we were telling you what the revenue per unit is, we're giving you the unit assumptions and doing the math. We don't give the number for the 9X program just a little bit. That program hasn't been certified quite yet so it was a little bit more confidential.

[Brian Shore, Chairman & CEO at Park Aerospace]

We won't give the information away. Slide 27, just a footnote which kind of explain all the math on slide 26. I'm sure we're not going go over those. Slide 28, okay, this is where we're going to slow down. This is the new and big thing.

[Brian Shore, Chairman & CEO at Park Aerospace]

War and peace question mark in Parens. Parks new juggernaut. This is the the first juggernaut is the GE Aviation programs. It's GE Aerospace programs. This is our new juggernaut.

[Brian Shore, Chairman & CEO at Park Aerospace]

Supplies of key missile defense systems are reportedly seriously depleted as a result of recent wars in The Mideast and Europe. There's an urgent need to replenish those systems. So I gotta stop here and explain something. We're gonna be talking about three different defense programs. There are many programs, and the others we're not able to talk about.

[Brian Shore, Chairman & CEO at Park Aerospace]

But one thing I want you to understand is very important. We're not providing any inside information about these programs, nothing at all. Everything we're telling you about is just based upon stuff publicly reported in news and other reports. So I just want you to understand that. We're not giving away any inside information on these programs.

[Brian Shore, Chairman & CEO at Park Aerospace]

The PAC-three Patriot Missile Defense System. We've been talking about this for a while, but boy, it's become headline news. Largest deployment of PAC-three Patriot missile defense systems in history occurred in response to Iran's ballistic missile strikes on that, I can't pronounce it, let's just say air base in Qatar. The Patriot Missile Battalion was reportedly moved to Qatar from South Korea and Japan in anticipation of Iran's ballistic missile strike in response to US strategic bombing of Iran's nuclear weapon sites. So we had Iraq together, obviously.

[Brian Shore, Chairman & CEO at Park Aerospace]

We we knew what the response was gonna be. But how do you think South Korea and Japan feel about that? You think they're happy about it? This is a shell game here. You know, we what's going on?

[Brian Shore, Chairman & CEO at Park Aerospace]

We don't we don't have enough systems. That's the reason why we're doing this. We're, you know, robbing Peter to pay Paul. It's not funny. Israel's supply of Patriot missile systems have reportedly not this is no inside information.

[Brian Shore, Chairman & CEO at Park Aerospace]

It's publicly reported, but seriously depleted as a result of the war with Iran. Ukraine's supply of Patriot missile systems, we know that, they're begging for it. They're begging for it, Ukraine has reportedly been seriously depleted as a result of the war with Russia. Other countries have been promised Patriot missile systems for years. They don't have them.

[Brian Shore, Chairman & CEO at Park Aerospace]

We, you know, can't get them. War and peace continued on slide 29. In the news conference, did you see this news conference at the recent NATO summit? President Trump stated in response to Ukrainian reporter's question about providing additional patron missiles to Ukraine. It was kinda sad.

[Brian Shore, Chairman & CEO at Park Aerospace]

I mean, I almost thought she was about to cry. We're going he said, president Trump, we're gonna see if we can make some available, The US is supplying to Israel, and they are very hard to get. This is what he said. And we, in The US, need them too. So there's a problem.

[Brian Shore, Chairman & CEO at Park Aerospace]

There's an urgent desperate need for these things and we just don't have them. The US reportedly has 25% of Patriot missiles needed for the Pentagon's military plans, 25. It was recently reported that The US has temporarily paused Patriot missile systems to Ukraine over concerns about an alarming, that's not my term, that's a turn that was reported depletion of US stockpiles of the weapon systems. The pause was intended to allow US to do an assessment of current stockpiles of an urgent needs for the weapon systems, and we're trying to figure out what we're doing. It's almost like we got steamrolled.

[Brian Shore, Chairman & CEO at Park Aerospace]

Slide 30, continuing with Patriot, War and Peace, New Juggernaut. Then in a news conference in the White House yesterday with President Trump and AO secretary general Mark Rutti, I think. I don't how you pronounce it. I think that's how you pronounce it. Did you see this one?

[Brian Shore, Chairman & CEO at Park Aerospace]

President Trump announced that in response to Russia's continued military aggression, West weapon weapon systems to Ukraine, especially Patriot missile system shipments, will be significantly increased. So, so much for the pause, you know. But here's the other thing, was announced that 17 additional Patriot missile systems, not clear if that was reference to batteries, launchers, or missiles, will be immediately transferred from another unnamed country, I don't know which country, which does not need them as much. They don't need them as badly. Okay.

[Brian Shore, Chairman & CEO at Park Aerospace]

Question mark to Ukraine. So wonder how that country feels about this. Are they pretty delighted they're losing their patriot systems? Again, it's, what do you call it, shell game or pet Robert Peen or pet Paul. This is not funny.

[Brian Shore, Chairman & CEO at Park Aerospace]

It's not funny. Patriot missile systems are planned to be incorporated into president Trump's Golden Dome missile defense system. So it's not just replenishing all these missile systems. We need a lot more of them. They're gonna be in the Golden Dome.

[Brian Shore, Chairman & CEO at Park Aerospace]

According to Sputnik News, that's the Russian news agency I think or news agency in Russia. US Army plans to boost its procurement of PAC-three Patent Missile Systems by four times. So we could be kind of smart Alex about Russian misinformation. But they're not the ones that came up with the story that Donald Trump was a Russian spy, Russian asset. They're not the ones that came up with the story that that laptop was Russian misinformation.

[Brian Shore, Chairman & CEO at Park Aerospace]

So, you know, what is the expression? If you're in glass houses, you don't throw stones. Slide 31, it is apparent from the reporting that The US plans to do much more than just replenish the completed stockpile at Patriot missile systems a lot more. Yeah. So let's talk about our involvement with the PACT-three Patriot missile system.

[Brian Shore, Chairman & CEO at Park Aerospace]

Park supports the PACT-three Patriot missile system with specially materials produced with that C2B fabric from Airing Group. And we're sole source qualified for specialty ablative materials on that program. We were recently asked to increase our expected output of specially ablative materials from program by significant orders of magnitude. We won't say how much because it's too confidential. We can't give it away.

[Brian Shore, Chairman & CEO at Park Aerospace]

Of course, PARCC will support this request. At PARCC, we are patriots. Park recently entered into that new agreement we talked about with the Aaron Group, referred to above, with the purchase of increasing C2B manufacturing capacity. Under the circumstances, timing is very fortuitous, but will that additional manufacturing capacity be enough? Probably not.

[Brian Shore, Chairman & CEO at Park Aerospace]

Park recently received a proposed blanket purchase order from a key OEM for up to $40,000,000 of C2B fabric. Yet what's going on here? Next slide, 32. Teas and Csus agreement are being negotiated. When we process that $40,000,000 into material, it'd be a significant amount.

[Brian Shore, Chairman & CEO at Park Aerospace]

We're not going to say how much because, again, it's too confidential. Let's go into another program which is in news. Maybe not quite as much as Patriot but definitely in the news. Israel's Arrow three and Arrow four missile defense systems. The Arrow three system has reportedly seen extensive use in Israel's recent war with Iran.

[Brian Shore, Chairman & CEO at Park Aerospace]

Israel stockpiled these Arrow three weapon systems and reportedly seriously depleted. Again, just reading reports, no inside information from us. The Arrow four system which is reportedly in the final stages of development is designed to intercept hypersonic missiles in the space transition zone. That's pretty elegant, right? Germany is buying the R-three and R-four systems from Israel.

[Brian Shore, Chairman & CEO at Park Aerospace]

So again, it's not just replacing what's depleted, there's a significant additional need for these systems. Israel may need to do much more than just replenish the depleted stockpile, I guess I just said that, of these Arrow systems. What's our involvement? We're qualifying the Arrow three, we're sole source, we're qualifying the Arrow four, and that's all we're going to talk about, say about it. But on slide 33, we're still sorry, still in Arrow.

[Brian Shore, Chairman & CEO at Park Aerospace]

What are the signals parts receiving in the market about these weapon systems? Let's just say acceleration. So let's change gears here a little bit. Is The US planning to rely exclusively on missile defense systems in the future, you know, the Golden Dome? Are we done with MAD?

[Brian Shore, Chairman & CEO at Park Aerospace]

If you're old enough, you might remember MAD, mutually assured destruction from the Cold War days way, way back. Maybe not. What about the LGM 34 35A Sentinel missile system? That's certainly an that's certainly not a defensive system. That's ICBMs.

[Brian Shore, Chairman & CEO at Park Aerospace]

ICBMs. You know what they are. Right? Replacing the four fifty Minuteman, three ICBMs. Parksman and men history.

[Brian Shore, Chairman & CEO at Park Aerospace]

So it's interesting if you I don't well, interesting to me anyway. In 1972, when they first introduced the Minuteman, Lockheed Sunnyvale asked Park to take weight out of the missile system. And we did that by developing multi circuit boards. Are you aware of that? That Park developed, invented multi layer circle boards?

[Brian Shore, Chairman & CEO at Park Aerospace]

That's what we did. And so we may be coming full circle. That was the very beginning of the MIDMAN program. It is now the replacement MIDMAN three. Four fifty new missile silos.

[Brian Shore, Chairman & CEO at Park Aerospace]

You know missile silos? All of have seen them in videos and things like that. 659 missiles. Again, this is all stuff that's public. You look it up yourself.

[Brian Shore, Chairman & CEO at Park Aerospace]

You know? Nothing we're giving away here. What's our involvement? We're not we're not able to say. Slide 34, we kinda touched on this already.

[Brian Shore, Chairman & CEO at Park Aerospace]

As a general matter, it's more difficult to discuss the defense programs we support as compared to commercial programs we support. Many of the defense programs are highly sensitive and confidential. But please understand something, there are several additional critical defense programs which we are supporting or are planning to support, and we're not able to discuss those things. In some cases, those programs represent significant revenue potential for PAR. Now, we'll change gears here.

[Brian Shore, Chairman & CEO at Park Aerospace]

Some people ask, what will happen to fence spending if real lasting peace breaks out? We sure hope it does. What if the Israelis and Persians end their wars? What if the Arab states sign up for those Abraham Accords? What happens if the Ukrainians and Russians they sell their difference and put their arms down?

[Brian Shore, Chairman & CEO at Park Aerospace]

It'd be all very nice and wonderful. Will this fence spending drop off precipitously as it did for World War II? You know what happened after World War II? Over 90%, I think like 93%, I mean, basically fell off a cliff. Will he beat our swords into plow shears?

[Brian Shore, Chairman & CEO at Park Aerospace]

You probably know it's from the bible. We're betting against that apart. We hope that peace breaks out, it's lasting peace, but we're betting against that our swords will be beaten into plow shears. Let's go on to slide 35. So another, you know, we talked about this last time, so we're just gonna update you a little bit.

[Brian Shore, Chairman & CEO at Park Aerospace]

Our major new expansion of parts manufacturing facilities, an update. So as you know we're planning a major new expansion of our manufacturing facilities. It will require a new plant that could be in Newton, Kansas or somewhere else. The plant expansion will include the following lines. This is all something we covered before.

[Brian Shore, Chairman & CEO at Park Aerospace]

Solution hot melt film, hot melt tame, hypersonic material manufacturing. Preliminary estimate capital budget. The new manufacturing plant equipment, 35,000,000 plus or minus five. I hate to tell you this, but that number may be a little low. We may need additional solution treating that might be based upon things we just talked about, things we just covered.

[Brian Shore, Chairman & CEO at Park Aerospace]

So we'll keep you updated on that. I just want you to be aware. Let's go on slide 36. Why are we doing this? Our juggernauts require it.

[Brian Shore, Chairman & CEO at Park Aerospace]

Our new long term business forecast requires it. Significant requirements and new business opportunities for both hot melt and solution composite materials. Defense and missile programs are drivers. And the long term forecast has moved higher just since May 15 since we last talked to you about it. Why are doing it?

[Brian Shore, Chairman & CEO at Park Aerospace]

To have the manufacturing capacity and flexibility needed to take advantage of new opportunities as they arise. And last item, interesting, a little nuance, need to have the manufacturing capacity needed for park to be park. What does that mean? Well, our cooling cards are parked, flexibility, responsiveness, energy. That's how we build the business we got.

[Brian Shore, Chairman & CEO at Park Aerospace]

You know, that's not normally how things are done in aerospace, but we're different. So we need a cushion manufacturing capacity. They're very important, very important for Park. We don't, we never want to abandon what has worked for us and what, these are core principles for PARCC, flexibility, responsiveness, urgency. Let's go on to slide 37.

[Brian Shore, Chairman & CEO at Park Aerospace]

We were thinking of planning for the long term and back to why we're doing conceptually five years out. We'll get back to you on that but it probably will take to the end of the year before we have our plans finalized and then we have to design our factory, we have to design the equipment. It's not stuff you order off the shelf like at Walmart. All this equipment is very specially designed and a lot of engineering work. To build a factory and equipment, it takes a long time.

[Brian Shore, Chairman & CEO at Park Aerospace]

The factory has to be completed, the equipment has to be delivered, the suppliers have to sign up for the equipment, we have to do trials, have to do qualification runs. We're talking years before we'd actually be able to ship qualified product from this new factory years. So it's very important to keep that in mind. That's why we need to look ahead. We're thinking and planning for our future.

[Brian Shore, Chairman & CEO at Park Aerospace]

Conceptually five years out that's probably not a bad concept number, you know, maybe a little less than that, but it's not two years and probably not three years either between now and when we're able to ship product for those new factory. Not sharing a new long term forecast at this time, but suffice to say for now that this is an exciting challenging time for PARCC. The opportunities for PARCC are significant. The timing is now. We must take advantage of the opportunities now.

[Brian Shore, Chairman & CEO at Park Aerospace]

We must not squander these very special opportunities. You you could say once a lifetime, I was gonna say that, thought, well, is that overly dramatic? So just very special opportunities. But we must not hesitate, you know. In this case, he or she hesitates, you know what happens.

[Brian Shore, Chairman & CEO at Park Aerospace]

So our objective is to have our expansion plan in place by the end of the calendar year and to be moving into implementation phase of our plan by then. So after our last call, one of our investors, investor asked, well, should we wait? Should hold off? That's not how it works in aerospace. Don't wait until we get the business booked or it's in our backlog.

[Brian Shore, Chairman & CEO at Park Aerospace]

It's a kind of a circular thing, but if we waited, it would be too late, way too late, but we're not gonna get in our backlog to begin with because nobody's gonna give us the business if we can't explain to them and we have the ability to handle the business, to support the business with their manufacturing capacity. So timing is now. I would just comment, maybe this sounds a little defensive, I don't know, but I want you to think about something. Pork's been around for seventy two years. Why is that?

[Brian Shore, Chairman & CEO at Park Aerospace]

Is it because we grab with the first shiny thing? I don't think so. We haven't taken shortcuts, no easy way outs, Very good discipline. No debt cashed. Over $600,000,000 of dividends paid.

[Brian Shore, Chairman & CEO at Park Aerospace]

Are we, you know, giving into doing wild and responsible things? You know, think about our history. Think about that a little bit. I'd appreciate if you do that, you know. So maybe for somebody else who would make a nervous, oh, what are these people doing?

[Brian Shore, Chairman & CEO at Park Aerospace]

Do you have any example of when we've chased something we should have chased? Can you think about that a little bit? You know, like I said, maybe it sounds a little defensive, but I thought it's better to talk about it if somebody said, you know, maybe you're being too aggressive. I don't think so. I don't think so.

[Brian Shore, Chairman & CEO at Park Aerospace]

This is, like I said, maybe a once in a lifetime opportunity and what would be really irresponsible apart would be to squander the opportunity, and we're not going to do that. So that's it. Let's go on to slide 38. Nothing here. This is exactly the same slide that we had in our Q4 presentation.

[Brian Shore, Chairman & CEO at Park Aerospace]

All I'll say is that estimated non G program incremental sales, that number is just so blown out the window. It's not even funny that we're not giving the number, but the number is quite significant. And the number's built up pretty conservatively also because the line items include only things we know about and can quantify. There are a lot of things we know about that we can't quantify quite yet, and they're not even in our number. So actually even the number is quite a high number.

[Brian Shore, Chairman & CEO at Park Aerospace]

It's also I think a pretty conservative number. We spent a lot of time on this already. We're taking this project very seriously, a lot of due diligence being done by lots of different people at different levels. So we wanna make sure we get it right. And that's it for us.

[Brian Shore, Chairman & CEO at Park Aerospace]

Operator, we're done with our presentation, Mark and I would be happy to take any questions to the extent there are any at this time.

[Operator]

Thank you. We'll now be conducting a question and answer session. Thank you. Our first question is from Nick Repostella with NR Management.

[Analyst]

Hey, good afternoon. A lot of exciting things going on there. I just have a simple question. Slide 21, the recently entered in into new LTA. You know, is there anything different about this LTA than previous ones with GE Aerospace that you could discuss?

[Brian Shore, Chairman & CEO at Park Aerospace]

Didn't hear you exactly. You what are you asking about the the

[Analyst]

On slide 21, you referenced

[Brian Shore, Chairman & CEO at Park Aerospace]

Oh, slide 21. Okay.

[Analyst]

Yeah. A a new LTA with GE Aerospace for '25 through '30. And I'm just wondering if is there anything different in that LTA than, you know, previous ones?

[Brian Shore, Chairman & CEO at Park Aerospace]

That's a good question, and that evidences that we're probably confusing everybody. So the LTA we've been talking about for years is an LTA with MRAS. It was not GE Aviation. So by and large, those programs that we talk about are MRAS programs. That's a separate LTA that goes through 2019 through 2029.

[Brian Shore, Chairman & CEO at Park Aerospace]

This LTA market, this is something more negotiated with GE Aerospace. There are still engine programs but they're different engine programs and different materials. So this is, you know, they defeated the GE Aviation programs and maybe we're confusing the matter too much, it's a different LTA. But just so you know, all of the GE Aerospace revenues are included in the history, in our sales history, as well as the juggernaut. So we include the GE Aerospace revenues from the MRAS LTA and from the GE LTA in both the history historical sales, the GE aviation programs, as well as the nice juggernaut slide.

[Analyst]

Okay. Okay. And one other question?

[Brian Shore, Chairman & CEO at Park Aerospace]

Please go ahead.

[Analyst]

Hello? Yeah.

[Brian Shore, Chairman & CEO at Park Aerospace]

Yes. Please. Yeah.

[Analyst]

This this may be a a difficult one. But at what point do you think you would feel comfortable filling in some of the question marks on your long term forecast. You know, when you use terms like, you know, blowing out the water, it's very exciting. But if someone were to attempt to build a model out a few years, at what point would you feel comfortable, you know, giving us some information to build such a model, you know, for the longer term picture?

[Brian Shore, Chairman & CEO at Park Aerospace]

Well, we have the models internally, and we've, you know, spent a lot of time reviewing them internally and reviewing the board, of course. I think we feel it's a little premature to share this information with the public, and it might also be a little bit shocking too, so we're holding back a little bit. I think we want to get a little more confidence. You know, And Nick, like I said, we're doing a lot of due diligence, a lot of internal discussions, and so we I think we like to get a little more comfort, confidence in, you know, in what we're doing in terms of budget and everything else because that'll be part of the equation, I guess. I don't have an answer, but, you know, like I said, we hope to have a plan complete by the end of the calendar year and go into implementation phase at that point. I think by that time, we should feel that we're in a position to provide that information.

[Brian Shore, Chairman & CEO at Park Aerospace]

So I don't know about during our Q3 call, would be, what, October? No, that's our Q2 call in October. Hope that if not then, by the time of our q three call, which would be the January. So I'm sorry about that, but I I appreciate if we could just hang in there.

[Analyst]

That's that's okay. And then just to, you know, pat you all on the back, I think with respect to your plans for investments, the team there has pretty much earned the trust of shareholders, I think. You've been wise and not buying stupid things. And certainly with share repurchase, you've been judicious, and I've seen a lot of bad examples. So I just wanna reflect that sentiment. Thank you.

[Brian Shore, Chairman & CEO at Park Aerospace]

Well, thank you very much, Nick. You know, this Charlie Munger guy, he passed away recently, but he I'm probably gonna get this wrong. He said something about they're successful not because they're always brilliant, but they're never stupid. You know? And being not being stupid, you know, means a lot.

[Brian Shore, Chairman & CEO at Park Aerospace]

Like, don't do something stupid. Don't let go for the gold shiny stuff when it's just BS and just be everybody's doing it. Don't, you know, be cheap to to everybody else doing it. So we try to be really disciplined over the years and not just because everybody else is doing it, not do those things and do what we think is right for the company.

[Analyst]

Okay. So next week, we won't see a press release with an investment in Bitcoin mining.

[Brian Shore, Chairman & CEO at Park Aerospace]

Maybe not. I don't know.

[Analyst]

Okay. Thank you so much.

[Brian Shore, Chairman & CEO at Park Aerospace]

Thank you, Nick.

[Operator]

Thank you. There are no further questions at this time. I'd like to hand the floor back over to Brian Shore for any closing remarks.

[Brian Shore, Chairman & CEO at Park Aerospace]

Okay. Well, thank you very much for everybody, very much for listening in. Was nice to update you. And please feel free to call us if you like, have any follow-up questions, and have a good day. Thank you. Goodbye.

[Operator]

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

Participants

Executives

• Brian Shore, Chairman & CEO

Analysts

• Mark Esquivel, President & COO at Park Aerospace
• Analyst