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EX-99.1 - EXHIBIT 99.1 - PARK AEROSPACE CORPex_131438.htm
8-K - FORM 8-K - PARK AEROSPACE CORPpke20181210_8k.htm

Exhibit 99.2

 

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

On December 4, 2018, Park Electrochemical Corp. (“Park” or the “Company”) completed the previously announced sale (the “Sale”) of its digital and radio frequency/microwave printed circuit materials business (collectively, the “Electronics Business”), including manufacturing facilities in Singapore, France, Arizona and California and R&D facilities in Arizona and Singapore, to AGC Inc., a Japanese corporation (the “Buyer”). The Sale was completed pursuant to the terms of the Stock Purchase Agreement (the “Purchase Agreement”), dated as of July 25, 2018, by and among the Company, its wholly-owned subsidiary, ParkNelco SNC, an entity organized under the laws of France, and the Buyer. Under the terms of the Purchase Agreement, the Buyer acquired all of the outstanding equity interests in Nelco Products, Inc., a Delaware corporation, Neltec, Inc., a Delaware corporation, Neltec SA, an entity organized under the laws of France, and Nelco Products Pte. Ltd., an entity organized under the laws of Singapore (collectively, the “Acquired Subsidiaries”), all of which were, directly or indirectly, wholly-owned subsidiaries of the Company, for an aggregate purchase price of $145 million in cash, subject to post-closing adjustments for changes in working capital compared to a target, cash in the Acquired Subsidiaries and certain accrued and unpaid taxes of the Acquired Subsidiaries.

 

The following unaudited pro forma condensed consolidated balance sheet and statements of operations have been derived by the application of adjustments to the Company’s historical financial statements as previously filed. The unaudited pro forma balance sheet as of August 26, 2018 depicts the impact of the Sale as if it had occurred on August 26, 2018. The unaudited pro forma statements of operations for the six months ended August 26, 2018 and the year ended February 25, 2018 depict the pro forma impact of the Sale as if the transaction had occurred on February 27, 2017. The unaudited pro forma financial statements are presented for comparative purposes only and are not intended to be indicative of the balance sheet and statements of operations which would have been realized had the Sale been consummated as of the date or during the periods for which the unaudited pro forma financial statements are presented or for any future period or date. The unaudited pro forma condensed consolidated financial statements should be read in conjunction with Park’s historical financial statements and related notes for the periods presented.

 

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Park Electrochemical Corporation

Unaudited Pro Forma Condensed Consolidated Balance Sheet

As of August 26, 2018

(Amounts in thousands)

 

   

Historical

   

Sale of

Electronics Business

Adjustments

   

Other Pro Forma Adjustments

   

Pro Forma

 

ASSETS

                               

Current assets:

                               

Cash and cash equivalents

  $ 20,854     $ -     $ 123,416 (a)   $ 144,270  

Marketable securities

    87,456       -       -       87,456  

Accounts receivable, net

    5,878       -       -       5,878  

Inventories

    3,994       -       -       3,994  

Prepaid expenses and other current assets

    1,578       -       -       1,578  

Current Assets - Discontinued Operations

    22,624       (22,624 )     -       -  

Total current assets

    142,384       (22,624 )     123,416       243,176  
                                 

Property, plant and equipment, net

    9,111       -       -       9,111  

Goodwill and other intangible assets

    9,818       -       -       9,818  

Other assets

    377       -       -       377  

Non-current Assets - Discontinued Operations

    11,406       (11,406 )     -       -  

Total assets

  $ 173,096     $ (34,030 )   $ 123,416     $ 262,482  
                                 

LIABILITIES AND SHAREHOLDERS' EQUITY

                               

Current liabilities:

                               

Accounts payable

  $ 1,091     $ -     $ -     $ 1,091  

Accrued liabilities

    1,108       -       -       1,108  

Income taxes payable

    1,467       -       -       1,467  

Current Liabilities - Discontinued Operations

    8,170       (8,170 )     1,834 (b)     1,834  

Total current liabilities

    11,836       (8,170 )     1,834       5,500  
                                 

Non-current income taxes payable

    18,594       -       -       18,594  

Deferred income taxes

    3,309       -       -       3,309  

Other liabilities

    314       -       -       314  

Non-current Liabilities - Discontinued Operations

    846       (846 )     -       -  

Total liabilities

    34,899       (9,016 )     1,834       27,717  

Total shareholders' equity

    138,197       (25,014 )     121,582 (c)     234,765  

Total liabilities and shareholders' equity

  $ 173,096     $ (34,030 )   $ 123,416     $ 262,482  

 

(a) Reflects the receipt of cash proceeds of $123,000 from the Sale, net of transaction costs and taxes. Includes an additional $413 for transaction expenses previously paid.

(b) Reflects accrued liabilities relating to a closed facility that was not purchased by the Buyer.

(c) This adjustment reflects the estimated gain arising from the Sale, and includes a ($77) adjustment to other comprehensive income related to foreign currency translation.  This estimated gain has not been reflected in the pro forma consolidated statement of operations as it is considered to be nonrecurring. No adjustment has been made to the proceeds of the Sale to give effect to any potential post-closing adjustments under the terms of the Purchase Agreement.

 

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Park Electrochemical Corporation

Unaudited Pro Forma Condensed Consolidated Statement of Operations

For the 26 Weeks Ended August 26, 2018

(Amounts in thousands, except per share amounts)

 

   

Historical

   

Sale of

Electronics Business

Adjustments

   

Other Pro

Forma

Adjustments

   

Pro Forma

 
                                 

Net sales

  $ 21,604     $ -     $ -     $ 21,604  

Cost of sales

    15,607       -       -       15,607  

Gross profit

    5,997       -       -       5,997  

Selling, general and administrative expenses

    4,217       -       -       4,217  

Earnings from operations

    1,780       -       -       1,780  

Interest and other income

    697       -       -       697  

Earnings before income taxes

    2,477       -       -       2,477  

Income tax (benefit) provision

    (163 )     -       -       (163 )

Net earnings

    2,640       -       -       2,640  

Earnings (Loss) from discontinued operations, net of tax

    3,228       (3,228 )     -       -  

Net Earnings

  $ 5,868     $ (3,228 )   $ -     $ 2,640  
                                 
                                 

Earnings per share :

                               

Basic:

                               

Continuing Operations

  $ 0.13     $ -     $ -     $ 0.13  

Discontinued Operations

    0.16       (0.16 )     -       -  

Basic earnings per share

  $ 0.29     $ (0.16 )   $ -     $ 0.13  

Basic weighted average shares

    20,253                       20,253  
                                 

Diluted:

                               

Continuing Operations

  $ 0.13     $ -     $ -     $ 0.13  

Discontinued Operations

    0.16       (0.16 )     -       -  

Diluted earnings per share

  $ 0.29     $ (0.16 )   $ -     $ 0.13  

Diluted weighted average shares

    20,382                       20,382  

 

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Park Electrochemical Corporation

 Unaudited Pro Forma Condensed Consolidated Statement of Operations

For the Fiscal Year Ended February 25, 2018

(Amounts in thousands, except per share amounts)

 

   

Historical

   

Sale of

Electronics

Business

Adjustments

   

Other Pro

Forma

Adjustments

   

Pro Forma

 
                                 

Net sales

  $ 111,196     $ (70,966 )   $ -     $ 40,230  

Cost of sales

    84,737       (56,528 )     -       28,209  

Gross profit

    26,459       (14,438 )     -       12,021  

Selling, general and administrative expenses

    19,371       (9,509 )     -       9,862  

Restructuring charges

    5,022       (4,876 )     -       146  

Earnings from operations

    2,066       (53 )     -       2,013  

Interest expense

    2,269       -       -       2,269  

Interest and other income

    2,675       (34 )     -       2,641  

Loss on sale of marketable securities

    (1,342 )     -       -       (1,342 )

Earnings before income taxes

    1,130       (87 )     -       1,043  

Income tax (benefit) provision

    (19,465 )     2,115       -       (17,350 )

Net earnings

  $ 20,595     $ (2,202 )   $ -     $ 18,393  
                                 

Earnings per share:

                               

Basic earnings per share

  $ 1.02     $ (0.11 )   $ -     $ 0.91  

Basic weighted average shares

    20,237                       20,237  
                                 

Diluted earnings per share

  $ 1.02     $ (0.11 )   $ -     $ 0.91  

Diluted weighted average shares

    20,267                       20,267  

 

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