Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Jun. 02, 2024 | Jul. 08, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 02, 2024 | |
Document Transition Report | false | |
Entity File Number | 1-4415 | |
Entity Registrant Name | PARK AEROSPACE CORP. | |
Entity Incorporation, State or Country Code | NY | |
Entity Tax Identification Number | 11-1734643 | |
Entity Address, Address Line One | 1400 Old Country Road | |
Entity Address, City or Town | Westbury | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 1159 | |
City Area Code | 631 | |
Local Phone Number | 465-3600 | |
Title of 12(b) Security | Common Stock, par value $.10 per share | |
Trading Symbol | PKE | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 20,253,361 | |
Entity Central Index Key | 0000076267 | |
Current Fiscal Year End Date | --03-03 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands | Jun. 02, 2024 | Mar. 03, 2024 | [1] |
Current assets | |||
Cash and cash equivalents | $ 4,081 | $ 6,567 | |
Marketable securities (Note 3) | 70,337 | 70,644 | |
Accounts receivable, less allowance for credit losses of $132 and $128, respectively | 11,386 | 12,381 | |
Inventories (Note 4) | 8,312 | 6,404 | |
Prepaid expenses and other current assets | 3,180 | 2,849 | |
Total current assets | 97,296 | 98,845 | |
Property, plant and equipment, net | 22,185 | 23,499 | |
Operating right-of-use assets (Note 5) | 81 | 95 | |
Goodwill and other intangible assets | 9,783 | 9,776 | |
Other assets | 83 | 94 | |
Total assets | 129,428 | 132,309 | |
Current liabilities | |||
Accounts payable | 2,201 | 3,514 | |
Operating lease liability (Note 5) | 17 | 53 | |
Accrued liabilities | 1,513 | 1,986 | |
Income taxes payable | 4,206 | 4,105 | |
Total current liabilities | 7,937 | 9,658 | |
Long-term operating lease liability (Note 5) | 107 | 82 | |
Non-current income taxes payable (Note 9) | 5,259 | 5,259 | |
Deferred income taxes (Note 9) | 3,240 | 3,222 | |
Other liabilities | 1,198 | 1,174 | |
Total liabilities | 17,741 | 19,395 | |
Commitments and contingencies (Note 11) | |||
Common stock | 2,096 | 2,096 | |
Additional paid-in capital | 170,534 | 170,445 | |
Accumulated deficit | (46,913) | (45,374) | |
Accumulated other comprehensive loss | (2,048) | (2,271) | |
Stockholders' Equity, Including Treasury Stock | 123,669 | 124,896 | |
Less treasury stock, at cost | 11,982 | 11,982 | |
Total shareholders' equity | 111,687 | 112,914 | |
Total liabilities and shareholders' equity | $ 129,428 | $ 132,309 | |
[1]The balance sheet at March 3, 2024 has been derived from the audited consolidated financial statements at that date. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ in Thousands | Jun. 02, 2024 | Mar. 03, 2024 |
Accounts receivable, allowance for doubtful accounts | $ 132 | $ 128 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Jun. 02, 2024 | May 28, 2023 | |
Net sales | $ 13,970 | $ 15,551 |
Cost of sales | 9,871 | 10,718 |
Gross profit | 4,099 | 4,833 |
Selling, general and administrative expenses | 2,017 | 2,615 |
Earnings from operations | 2,082 | 2,218 |
Storm Damage Charge (Note 11) | (1,052) | 0 |
Interest and other income | 339 | 324 |
Earnings from operations before income taxes | 1,369 | 2,542 |
Income tax provision (Note 9) | 376 | 688 |
Net earnings | $ 993 | $ 1,854 |
Basic: | ||
Basic earnings per share (in dollars per share) | $ 0.05 | $ 0.09 |
Basic weighted average shares (in shares) | 20,253 | 20,461 |
Diluted: | ||
Diluted earnings per share (in dollars per share) | $ 0.05 | $ 0.09 |
Diluted weighted average shares (in shares) | 20,371 | 20,526 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Earnings (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 02, 2024 | May 28, 2023 | |
Net earnings | $ 993 | $ 1,854 |
Other comprehensive (loss) earnings, net of tax: | ||
Other comprehensive earnings | 223 | 716 |
Total comprehensive earnings | 1,216 | 2,570 |
Gains on Marketable Securities [Member] | ||
Other comprehensive (loss) earnings, net of tax: | ||
Unrealized holding gains arising during the period | 258 | 592 |
Losses on Marketable Securities [Member] | ||
Other comprehensive (loss) earnings, net of tax: | ||
Unrealized holding gains arising during the period | (35) | 0 |
Less: reclassification adjustment for losses included in net earnings | $ 0 | $ 124 |
Consolidated Statements of Shar
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, Common [Member] | Total | |
Balance (in shares) at Feb. 26, 2023 | 20,965,144 | 493,934 | |||||
Balance at Feb. 26, 2023 | $ 2,096 | $ 169,932 | $ (42,694) | $ (4,244) | $ (9,156) | ||
Net earnings | 0 | 0 | 1,854 | 0 | 0 | $ 1,854 | |
Net earnings | 0 | 0 | 1,854 | 0 | 0 | 1,854 | |
Unrealized gain (loss) on marketable securities, net of tax | 0 | 0 | 0 | 716 | 0 | ||
Stock-based compensation | 0 | 218 | 0 | 0 | 0 | ||
Cash dividends | 0 | 0 | (2,559) | 0 | 0 | ||
Repurchase of treasury shares | $ 0 | 0 | 0 | 0 | $ (1,669) | ||
Repurchase of treasury shares (in shares) | 129,654 | ||||||
Balance (in shares) at May. 28, 2023 | 20,965,144 | 623,588 | |||||
Balance at May. 28, 2023 | $ 2,096 | 170,150 | (43,399) | (3,528) | $ (10,825) | ||
Balance (in shares) at Mar. 03, 2024 | 20,965,144 | 711,783 | |||||
Balance at Mar. 03, 2024 | $ 2,096 | 170,445 | (45,374) | (2,271) | $ (11,982) | 112,914 | [1] |
Net earnings | 0 | 0 | 993 | 0 | 993 | ||
Net earnings | 0 | 0 | 993 | 0 | 993 | ||
Unrealized gain (loss) on marketable securities, net of tax | 0 | 0 | 0 | 223 | 0 | ||
Stock-based compensation | 0 | 89 | 0 | 0 | 0 | ||
Cash dividends | $ 0 | 0 | (2,532) | 0 | $ 0 | ||
Balance (in shares) at Jun. 02, 2024 | 20,965,144 | 711,783 | |||||
Balance at Jun. 02, 2024 | $ 2,096 | $ 170,534 | $ (46,913) | $ (2,048) | $ (11,982) | $ 111,687 | |
[1]The balance sheet at March 3, 2024 has been derived from the audited consolidated financial statements at that date. |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Unaudited) (Parentheticals) - $ / shares | 3 Months Ended | |
Jun. 02, 2024 | May 28, 2023 | |
Cash dividends, per share (in dollars per share) | $ 0.125 | $ 0.125 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 02, 2024 | May 28, 2023 | |
Cash flows from operating activities: | ||
Net earnings | $ 993 | $ 1,854 |
Adjustments to reconcile net earnings to net cash (used in) provided by operating activities: | ||
Non-cash storm damage charge | 887 | 0 |
Depreciation and amortization | 439 | 305 |
Stock-based compensation | 89 | 218 |
Deferred income taxes | 18 | 2 |
Amortization of bond premium | 49 | 237 |
Loss on sale of marketable securities | 0 | 65 |
Changes in operating assets and liabilities | (2,898) | (2,564) |
Net cash (used in) provided by operating activities | (423) | 117 |
Cash flows from investing activities: | ||
Purchase of property, plant and equipment | (12) | (167) |
Purchases of marketable securities | (2,937) | 0 |
Proceeds from sales and maturities of marketable securities | 3,418 | 26,348 |
Net cash provided by investing activities | 469 | 26,181 |
Cash flows from financing activities: | ||
Dividends paid | (2,532) | (23,030) |
Purchase of treasury stock | 0 | (1,669) |
Net cash used in financing activities | (2,532) | (24,699) |
(Decrease) increase in cash and cash equivalents: | (2,486) | 1,599 |
Cash and cash equivalents, beginning of period | 6,567 | 4,237 |
Cash and cash equivalents, end of period | 4,081 | 5,836 |
Supplemental cash flow information: | ||
Cash paid during the period for income taxes, net of refunds | $ 0 | $ 608 |
Note 1 - Consolidated Financial
Note 1 - Consolidated Financial Statements | 3 Months Ended |
Jun. 02, 2024 | |
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 Statement of Shareholders’ Equity as of June 2, 2024, the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Earnings for the 13 weeks ended June 2, 2024 and May 28, 2023, and the Condensed Consolidated Statements of Cash Flows for the 13 week periods then ended have been prepared by Park Aerospace Corp. (the “Company”), without audit. In the opinion of management, these unaudited condensed consolidated financial statements contain all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at June 2, 2024 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 condensed 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, 2024. There have been no significant changes to such accounting policies during the 13 weeks ended June 2, 2024. |
Note 2 - Fair Value Measurement
Note 2 - Fair Value Measurements | 3 Months Ended |
Jun. 02, 2024 | |
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 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. 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, and accounts payable 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. 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. |
Note 3 - Marketable Securities
Note 3 - Marketable Securities | 3 Months Ended |
Jun. 02, 2024 | |
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, 2024 Total Level 1 Level 2 Level 3 U.S. Treasury and other government securities $ 66,857 $ 66,857 $ - $ - U.S. corporate debt securities 3,480 3,480 - - Total marketable securities $ 70,337 $ 70,337 $ - $ - March 3, 2024 Total Level 1 Level 2 Level 3 U.S. Treasury and other government securities $ 67,210 $ 67,210 $ - $ - U.S. corporate debt securities 3,434 3,434 - - Total marketable securities $ 70,644 $ 70,644 $ - $ - 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, 2024: U.S. Treasury and other government securities $ 69,661 $ - $ 2,804 U.S. corporate debt securities 3,482 - 2 Total marketable securities $ 73,143 $ - $ 2,806 March 3, 2024: U.S. Treasury and other government securities $ 70,320 $ - $ 3,110 U.S. corporate debt securities 3,435 - 1 Total marketable securities $ 73,755 $ - $ 3,111 The estimated fair values of such securities at June 2, 2024 by contractual maturity are shown below: Due in one year or less $ 31,800 Due after one year through five years 38,537 $ 70,337 |
Note 4 - Inventories
Note 4 - Inventories | 3 Months Ended |
Jun. 02, 2024 | |
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, 2024 2024 Inventories: Raw materials $ 6,844 $ 5,047 Work-in-process 454 397 Finished goods 1,014 960 $ 8,312 $ 6,404 |
Note 5 - Leases
Note 5 - Leases | 3 Months Ended |
Jun. 02, 2024 | |
Notes to Financial Statements | |
Lessee, Operating Leases [Text Block] | 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 terms to the extent the Company is reasonably certain to exercise the options. 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 ten Future minimum lease payments under non-cancellable operating leases as of June 2, 2024 are as follows: Fiscal Year: 2025 $ 22 2026 - 2027 - 2028 - 2029 3 Thereafter 159 Total undiscounted operating lease payments 184 Less imputed interest (60 ) Present value of operating lease payments $ 124 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 condensed consolidated balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the terms of the leases. For the 13 weeks ended June 2, 2024, the Company’s operating lease expenses were $15. Cash payments of $13, 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, 2024: Operating right-of-use assets $ 81 Operating lease liabilities $ 17 Long-term operating lease liabilities 107 Total operating lease liabilities $ 124 The Company’s weighted average remaining lease term for its operating leases is 10.6 years. |
Note 6 - Stock-based Compensati
Note 6 - Stock-based Compensation | 3 Months Ended |
Jun. 02, 2024 | |
Notes to Financial Statements | |
Share-Based Payment Arrangement [Text Block] | 6. STOCK-BASED COMPENSATION As of June 2, 2024, 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 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 On June 13, 2024, the Company’s Board of Directors adopted a proposed Amendment to 2018 stock option plan to increase the number of shares authorized for issuance under such plan by 750,000 shares, subject to shareholder approval at the Annual Meeting of Shareholders of the Company to be held on July 18, 2024. During the 2024 fiscal year, the Company recorded non-cash charges of $109 related to the modification of previously granted employee stock options resulting from the $1.00 per share special cash dividend paid by the Company in April 2023. The future compensation expense to be recognized in earnings before income taxes for options outstanding at June 2, 2024 was $578, which is expected to be recognized ratably over a weighted average vesting period of 1.24 years. The following is a summary of option activity for the 13 weeks ended June 2, 2024: Outstanding Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Balance, March 3, 2024 708,325 $ 11.53 $ 2,420 Granted - - Exercised - - Terminated or expired (1,375 ) 12.53 Balance, June 2, 2024 706,950 $ 11.53 5.74 $ 2,488 Vested and exercisable, June 2, 2024 521,113 $ 11.23 4.85 $ 1,993 |
Note 7 - Earnings Per Share
Note 7 - Earnings Per Share | 3 Months Ended |
Jun. 02, 2024 | |
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 Company’s 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, May 28, Net earnings $ 993 $ 1,854 Weighted average common shares outstanding for basic EPS 20,253 20,461 Net effect of dilutive options 118 65 Weighted average shares outstanding for diluted EPS 20,371 20,526 Basic earnings per share $ 0.05 $ 0.09 Diluted earnings per share $ 0.05 $ 0.09 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 0 and 157,000 for the 13 weeks ended June 2, 2024 and May 28, 2023, respectively. |
Note 8 - Shareholders' Equity
Note 8 - Shareholders' Equity | 3 Months Ended |
Jun. 02, 2024 | |
Notes to Financial Statements | |
Equity [Text Block] | 8. SHAREHOLDERS EQUITY On May 23, 2022, 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 1,500,000 additional shares of its common stock. This authorization superseded any unused prior Board of Directors’ authorizations to purchase shares of the Company’s Common Stock. The Company purchased 0 and 129,654 shares of its common stock during the 13 weeks ended June 2, 2024 and May 28, 2023, respectively. As a result, the Company is authorized to purchase up to a total of 1,278,901 shares of its common stock, representing approximately 6.3% of the Company’s 20,253,361 total outstanding shares as of the close of business on July 8, 2024. There is no assurance the Company will purchase any shares pursuant to this Board of Directors’ authorization. Shares purchased by the Company, if any, will be retained as treasury stock and will be available for use under the Company’s stock option plan and for other corporate purposes. |
Note 9 - Income Taxes
Note 9 - Income Taxes | 3 Months Ended |
Jun. 02, 2024 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | 9. INCOME TAXES For the 13 weeks ended June 2, 2024, the Company recorded an income tax provision of $376, which included a discrete income tax provision of $19. For the 13 weeks ended May 28, 2023, the Company recorded an income tax provision of $688, which included a discrete income tax provision of $37. The Company’s effective tax rate for the 13 weeks ended June 2, 2024 was 27.5% compared to 27.1% in the comparable prior year period. The effective tax rate for the 13 weeks ended June 2, 2024 was higher than the U.S. statutory rate of 21% primarily due to state and local taxes and discrete income tax provisions for the accrual of interest related to unrecognized tax benefits. The effective rate for the 13 weeks ended May 28, 2023 was higher than the U.S. statutory rate of 21% primarily due to state and local taxes and discrete income tax provisions for the accrual of interest related to unrecognized tax benefits. 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 on such earnings. |
Note 10 - Geographic Regions
Note 10 - Geographic Regions | 3 Months Ended |
Jun. 02, 2024 | |
Notes to Financial Statements | |
Geographic Regions [Text Block] | 10. GEOGRAPHIC REGIONS The Company’s products are sold to customers in North America, Asia and Europe. The Company’s manufacturing facility is located in Kansas. Sales are attributed to geographic regions based upon the region in which the materials were delivered to the customer. All of the Company’s long-lived assets are located in North America. Financial information regarding the Company’s operations by geographic region is as follows: 13 Weeks Ended June 2, May 28, Net Sales: North America $ 11,986 $ 13,619 Asia 719 130 Europe 1,265 1,802 Total net sales $ 13,970 $ 15,551 |
Note 11 - Storm Damage Charge
Note 11 - Storm Damage Charge | 3 Months Ended |
Jun. 02, 2024 | |
Notes to Financial Statements | |
Storm Damage Charges [Text Block[ | 11. STORM DAMAGE CHARGE The Company recorded a charge of $1,052 for storm damage in the 13 weeks ended June 2, 2024. On May 19, 2024, the Company’s manufacturing facilities in Newton, Kansas were damaged by a strong storm which transitioned the area. None of the Company’s manufacturing lines or equipment were damaged by the storm. Although the building structures are secure, the roofs on all three buildings in the Company’s Newton, Kansas campus will ultimately need to be replaced. Also, multiple specialty HVAC units were damaged or destroyed. These specialty HVAC units are necessary to control the temperature and humidity in certain manufacturing areas, quality laboratories and R&D laboratories, which is required by certain specifications and certifications the Company is subject to. The Company is currently working with multiple contractors on site and the insurance company in order to fully assess the damage and the remediation options. Although the Company is still in the process of assessing the situation, the Company’s production lines were returned to full production within two weeks of the storm. The Company is employing certain temporary measures in order to return its production lines to full service, including the use of temporary HVAC equipment, but it will take the Company several months to permanently repair or replace all of the damaged facilities and infrastructure equipment. The Company does not anticipate the loss of any sales for the 2025 fiscal year, however, $1.8 million of sales could not be delivered before the end of the first quarter ended June 2, 2024 due to storm related delays. The Company expects these delayed shipments will be delivered during the Company’s second quarter ended September 1, 2024. The Company paid its employees for the days immediately following the storm despite many not being able to work while others worked on the clean-up of the storm damage to the facilities. The Company incurred $78 of payroll and related costs for lost production time and employees working on clean-up. The charge recorded by the Company includes an asset damage charge, emergency services by outside contractors, rental of temporary HVAC units and the cost of employee downtime or time spent on the clean-up of the storm damage to the facilities. Additional costs will be recorded in future periods as additional work is needed and performed and for on-going rental of temporary HVAC units. The Company has insurance coverage for wind damage with a deductible of approximately $2.5 million. Under the insurance policy, the Company expects to recover all costs and damages incurred in excess of the deductible. The costs will be in part based on replacement costs, which will be in excess of the charge. Any insurance recovery will be recorded when realization can be determined and is assured. |
Note 12 - Contingencies
Note 12 - Contingencies | 3 Months Ended |
Jun. 02, 2024 | |
Notes to Financial Statements | |
Contingencies Disclosure [Text Block] | 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. 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 The Company does not two three 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. |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 02, 2024 | |
Insider Trading Arr Line Items | |
Material Terms of Trading Arrangement [Text Block] | Item 5 . Other Information . None |
Rule 10b5-1 Arrangement Adopted [Flag] | false |
Non-Rule 10b5-1 Arrangement Adopted [Flag] | false |
Rule 10b5-1 Arrangement Terminated [Flag] | false |
Non-Rule 10b5-1 Arrangement Terminated [Flag] | false |
Note 3 - Marketable Securities
Note 3 - Marketable Securities (Tables) | 3 Months Ended |
Jun. 02, 2024 | |
Notes Tables | |
Debt Securities, Available-for-Sale [Table Text Block] | June 2, 2024 Total Level 1 Level 2 Level 3 U.S. Treasury and other government securities $ 66,857 $ 66,857 $ - $ - U.S. corporate debt securities 3,480 3,480 - - Total marketable securities $ 70,337 $ 70,337 $ - $ - March 3, 2024 Total Level 1 Level 2 Level 3 U.S. Treasury and other government securities $ 67,210 $ 67,210 $ - $ - U.S. corporate debt securities 3,434 3,434 - - Total marketable securities $ 70,644 $ 70,644 $ - $ - |
Schedule of Available-for-Sale Securities Reconciliation [Table Text Block] | Amortized Cost Basis Gross Unrealized Gains Gross Unrealized Losses June 2, 2024: U.S. Treasury and other government securities $ 69,661 $ - $ 2,804 U.S. corporate debt securities 3,482 - 2 Total marketable securities $ 73,143 $ - $ 2,806 March 3, 2024: U.S. Treasury and other government securities $ 70,320 $ - $ 3,110 U.S. corporate debt securities 3,435 - 1 Total marketable securities $ 73,755 $ - $ 3,111 |
Investments Classified by Contractual Maturity Date [Table Text Block] | Due in one year or less $ 31,800 Due after one year through five years 38,537 $ 70,337 |
Note 4 - Inventories (Tables)
Note 4 - Inventories (Tables) | 3 Months Ended |
Jun. 02, 2024 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | June 2, March 3, 2024 2024 Inventories: Raw materials $ 6,844 $ 5,047 Work-in-process 454 397 Finished goods 1,014 960 $ 8,312 $ 6,404 |
Note 5 - Leases (Tables)
Note 5 - Leases (Tables) | 3 Months Ended |
Jun. 02, 2024 | |
Notes Tables | |
Lessee, Operating Lease, Liability, to be Paid, Maturity [Table Text Block] | Fiscal Year: 2025 $ 22 2026 - 2027 - 2028 - 2029 3 Thereafter 159 Total undiscounted operating lease payments 184 Less imputed interest (60 ) Present value of operating lease payments $ 124 |
Schedule of Right-of-use Assets and Operating Lease Liabilities [Table Text Block] | Operating right-of-use assets $ 81 Operating lease liabilities $ 17 Long-term operating lease liabilities 107 Total operating lease liabilities $ 124 |
Note 6 - Stock-based Compensa_2
Note 6 - Stock-based Compensation (Tables) | 3 Months Ended |
Jun. 02, 2024 | |
Notes Tables | |
Share-Based Payment Arrangement, Option, Activity [Table Text Block] | Outstanding Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Balance, March 3, 2024 708,325 $ 11.53 $ 2,420 Granted - - Exercised - - Terminated or expired (1,375 ) 12.53 Balance, June 2, 2024 706,950 $ 11.53 5.74 $ 2,488 Vested and exercisable, June 2, 2024 521,113 $ 11.23 4.85 $ 1,993 |
Note 7 - Earnings Per Share (Ta
Note 7 - Earnings Per Share (Tables) | 3 Months Ended |
Jun. 02, 2024 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | 13 Weeks Ended June 2, May 28, Net earnings $ 993 $ 1,854 Weighted average common shares outstanding for basic EPS 20,253 20,461 Net effect of dilutive options 118 65 Weighted average shares outstanding for diluted EPS 20,371 20,526 Basic earnings per share $ 0.05 $ 0.09 Diluted earnings per share $ 0.05 $ 0.09 |
Note 10 - Geographic Regions (T
Note 10 - Geographic Regions (Tables) | 3 Months Ended |
Jun. 02, 2024 | |
Notes Tables | |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | 13 Weeks Ended June 2, May 28, Net Sales: North America $ 11,986 $ 13,619 Asia 719 130 Europe 1,265 1,802 Total net sales $ 13,970 $ 15,551 |
Note 3 - Marketable Securitie_2
Note 3 - Marketable Securities - Summary of Available-for-sale Securities (Details) - USD ($) $ in Thousands | Jun. 02, 2024 | Mar. 03, 2024 |
Available-for-sale securities | $ 70,337 | $ 70,644 |
Fair Value, Inputs, Level 1 [Member] | ||
Available-for-sale securities | 70,337 | 70,644 |
Fair Value, Inputs, Level 2 [Member] | ||
Available-for-sale securities | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Available-for-sale securities | 0 | 0 |
US Treasury and Government [Member] | ||
Available-for-sale securities | 66,857 | 67,210 |
US Treasury and Government [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Available-for-sale securities | 66,857 | 67,210 |
US Treasury and Government [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available-for-sale securities | 0 | 0 |
US Treasury and Government [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Available-for-sale securities | 0 | 0 |
Debt Security, Corporate, US [Member] | ||
Available-for-sale securities | 3,480 | 3,434 |
Debt Security, Corporate, US [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Available-for-sale securities | 3,480 | 3,434 |
Debt Security, Corporate, US [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Available-for-sale securities | 0 | 0 |
Debt Security, Corporate, US [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Available-for-sale securities | $ 0 | $ 0 |
Note 3 - Marketable Securitie_3
Note 3 - Marketable Securities - Summary of Unrealized Gains and Losses on Available-for-sale Securities (Details) - USD ($) $ in Thousands | Jun. 02, 2024 | Mar. 03, 2024 |
Amortized cost basis | $ 73,143 | $ 73,755 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 2,806 | 3,111 |
US Treasury and Government [Member] | ||
Amortized cost basis | 69,661 | 70,320 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 2,804 | 3,110 |
Debt Security, Corporate, US [Member] | ||
Amortized cost basis | 3,482 | 3,435 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | $ 2 | $ 1 |
Note 3 - Marketable Securitie_4
Note 3 - Marketable Securities - Estimated Fair Value of Securities by Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 02, 2024 | Mar. 03, 2024 |
Due in one year or less | $ 31,800 | |
Due after one year through five years | 38,537 | |
Debt Securities, Available-for-Sale | $ 70,337 | $ 70,644 |
Note 4 - Inventories - Summary
Note 4 - Inventories - Summary of Inventories (Details) - USD ($) $ in Thousands | Jun. 02, 2024 | Mar. 03, 2024 | |
Raw materials | $ 6,844 | $ 5,047 | |
Work-in-process | 454 | 397 | |
Finished goods | 1,014 | 960 | |
Inventory, Net | $ 8,312 | $ 6,404 | [1] |
[1]The balance sheet at March 3, 2024 has been derived from the audited consolidated financial statements at that date. |
Note 5 - Leases (Details Textua
Note 5 - Leases (Details Textual) $ in Thousands | 3 Months Ended |
Jun. 02, 2024 USD ($) | |
Operating Lease, Expense | $ 15 |
Operating Lease, Payments | $ 13 |
Operating Lease, Weighted Average Remaining Lease Term (Year) | 10 years 7 months 6 days |
Minimum [Member] | |
Lessee, Operating Lease, Renewal Term (Year) | 1 year |
Maximum [Member] | |
Lessee, Operating Lease, Renewal Term (Year) | 10 years |
Note 5 - Leases - Future Minimu
Note 5 - Leases - Future Minimum Lease Payments (Details) $ in Thousands | Jun. 02, 2024 USD ($) |
Present value of operating lease payments | $ 124 |
Leases with Renewal Options [Member] | |
2025 | 22 |
2026 | 0 |
2027 | 0 |
2028 | 0 |
2029 | 3 |
Thereafter | 159 |
Total undiscounted operating lease payments | 184 |
Less imputed interest | (60) |
Present value of operating lease payments | $ 124 |
Note 5 - Leases - Schedule of R
Note 5 - Leases - Schedule of Right-of-use Assets and Operating Lease Liabilties (Details) - USD ($) $ in Thousands | Jun. 02, 2024 | Mar. 03, 2024 | [1] |
Operating right-of-use assets | $ 81 | $ 95 | |
Operating lease liabilities | 17 | 53 | |
Long-term operating lease liabilities | 107 | $ 82 | |
Total operating lease liabilities | $ 124 | ||
[1]The balance sheet at March 3, 2024 has been derived from the audited consolidated financial statements at that date. |
Note 6 - Stock-based Compensa_3
Note 6 - Stock-based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Jul. 18, 2024 | Jun. 02, 2024 | Apr. 30, 2023 | May 28, 2023 | |
Share-Based Payment Arrangement, Plan Modification, Incremental Cost | $ 109 | |||
S2023FYDividends [Member] | ||||
Common Stock, Dividends, Per Share, Cash Paid | $ 1 | |||
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% | |||
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period (Year) | 1 year | |||
Percentage of Stock Options Exercisable On Each Succeeding Year from Date of Grant | 25% | |||
Share-Based Compensation Arrangement by Share-Based Payment Award, Expiration Period (Year) | 10 years | |||
The 2018 Stock Option Plan [Member] | Forecast [Member] | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Additional Shares Authorized (in shares) | 750,000 |
Note 6 - Stock-based Compensa_4
Note 6 - Stock-based Compensation - Option Activity (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Jun. 02, 2024 USD ($) $ / shares shares | |
Balance (in shares) | shares | 708,325 |
Balance (in dollars per share) | $ / shares | $ 11.53 |
Balance | $ | $ 2,420 |
Outstanding options, granted (in shares) | shares | 0 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 0 |
Outstanding options, exercised (in shares) | shares | 0 |
Exercised, weighted average exercise price (in dollars per share) | $ / shares | $ 0 |
Outstanding options, terminated or expired (in shares) | shares | (1,375) |
Terminated or expired, weighted average exercise price (in dollars per share) | $ / shares | $ 12.53 |
Balance (in shares) | shares | 706,950 |
Balance (in dollars per share) | $ / shares | $ 11.53 |
Balance (Year) | 5 years 8 months 26 days |
Balance | $ | $ 2,488 |
Vested and exercisable (in shares) | shares | 521,113 |
Vested and exercisable (in dollars per share) | $ / shares | $ 11.23 |
Vested and exercisable (Year) | 4 years 10 months 6 days |
Vested and exercisable | $ | $ 1,993 |
Note 7 - Earnings Per Share (De
Note 7 - Earnings Per Share (Details Textual) - shares | 3 Months Ended | |
Jun. 02, 2024 | May 28, 2023 | |
Share-Based Payment Arrangement, Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 157,000 |
Note 7 - Earnings Per Share - B
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, 2024 | May 28, 2023 | |
Net earnings | $ 993 | $ 1,854 |
Weighted average common shares outstanding for basic EPS (in shares) | 20,253 | 20,461 |
Net effect of dilutive options (in shares) | 118 | 65 |
Weighted average shares outstanding for diluted EPS (in shares) | 20,371 | 20,526 |
Basic earnings per share (in dollars per share) | $ 0.05 | $ 0.09 |
Diluted earnings per share (in dollars per share) | $ 0.05 | $ 0.09 |
Note 8 - Shareholders' Equity (
Note 8 - Shareholders' Equity (Details Textual) - shares | 3 Months Ended | |||
Jun. 02, 2024 | May 28, 2023 | Jul. 08, 2023 | May 23, 2022 | |
Share Repurchase Program, Authorized, Number of Shares | 1,500,000 | |||
Stock Repurchased During Period, Shares | 0 | 129,654 | ||
Share Repurchase Program, Remaining Authorized, Number of Shares | 1,278,901 | |||
Stock Repurchase Program, Percentage of Outstanding Shares Authorized to be Repurchased | 6.30% | |||
Common Stock, Shares, Outstanding | 20,253,361 |
Note 9 - Income Taxes (Details
Note 9 - Income Taxes (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 02, 2024 | May 28, 2023 | |
Income Tax Expense (Benefit) | $ 376 | $ 688 |
Income Tax Expense (Benefit), Discrete Amount | $ 19 | $ 37 |
Effective Income Tax Rate Reconciliation, Percent | 27.50% | 27.10% |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21% | 21% |
Undistributed Earnings, Basic, Total | $ 25,000 |
Note 10 - Geographic Regions -
Note 10 - Geographic Regions - Financial Information by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 02, 2024 | Jun. 02, 2023 | May 28, 2023 | |
Sales | $ 13,970 | $ 15,551 | $ 15,551 |
North America [Member] | |||
Sales | 11,986 | 13,619 | |
Asia [Member] | |||
Sales | 719 | 130 | |
Europe [Member] | |||
Sales | $ 1,265 | $ 1,802 |
Note 11 - Storm Damage Charge (
Note 11 - Storm Damage Charge (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 02, 2024 | May 28, 2023 | |
Storm Damage Charges | $ 1,052 | $ 0 |
Revenue, Delayed Delivery Due to Storm | 1,800 | |
Payroll and Related Costs Incurred, Storm Cleanup | 78 | |
Insurance, Deductible | $ 2,500 |
Note 12 - Contingencies (Detail
Note 12 - Contingencies (Details Textual) $ in Thousands | 3 Months Ended |
Jun. 02, 2024 USD ($) | |
Percentage of Legal Defense and Remediation Costs Associated with Sites Reimbursed by Insurance Carriers | 100% |
Number of Units Covered Under General Liability Insurance Coverage | 2 |
Accrual for Environmental Loss Contingencies | $ 0 |
Number of Insurance Carriers | 3 |