Press Release

 

Contact: Murray Stamer
Park Electrochemical Corp.
(516) 354-4100

PARK ELECTROCHEMICAL REPORTS FIRST QUARTER RESULTS AND ONE-TIME CHARGES

LAKE SUCCESS, New York, June 27, 2001…Park Electrochemical Corp. (NYSE-PKE) reported sales of $69,102,000 for the first quarter ended May 27, 2001 compared to $120,159,000 for the first quarter of last year. Park reported a net loss of $3,140,000 before one-time pre-tax charges of $16,388,000 described below for the quarter compared to net earnings of $8,829,000 for last year’s first quarter. Park’s loss per share for the first quarter before the one-time charges was $.16 basic and diluted versus earnings per share of $.56 basic and $.50 diluted for last year’s first quarter. The first quarter net loss including the one-time charges was $14,612,000 and the loss per share including such charges was $.75 on both a basic and diluted basis.

The average number of shares outstanding for the quarter ended May 27, 2001 was 19,420,000 basic and diluted compared to 15,858,000 basic and 19,602,000 diluted for the prior year’s first quarter. The increase in the number of the basic shares outstanding was due to the conversion of $95,934,000 principal amount of the Company’s 5.5% Convertible Subordinated Notes into 3,411,000 shares of the Company’s common stock on March 1, 2001.

As previously reported, during the quarter ended May 27, 2001, the Company sold the assets and business of Nelco Technology, Inc. (“NTI”), a wholly-owned Park subsidiary, and closed a related support facility to NTI in Arizona. The Company incurred a pre-tax charge of $15,707,000 in connection with this sale and closure. In addition, the Company incurred pre-tax severance charges of $681,000 during the quarter relating to the layoff of employees at the Company’s continuing operations. Accordingly, the total one-time pre-tax charges for the first quarter were $16,388,000.

Brian Shore, Park’s President and CEO, said, “As we previously announced, the global electronics manufacturing industry is in a state of deep distress at this time. I have discussed at length in our fourth quarter earnings announcement and our recent annual report my perspective on the excesses and maybe even occasional foolhardiness of the global electronics industry, and I will not repeat those comments here. As a result of this severe industry downturn, even though our Company continues to gain additional market share with some of the best electronics manufacturing companies in the industry, our sales volumes and bookings during the months of May and June are running at approximately 40 percent of the average sales and bookings levels of the 2001 fiscal year!”

Brian Shore continued, “We really do not know when the global electronics markets will recover, and we will not speculate about the timing of the recovery. What we do know is that we continue to believe very strongly in the long-term future of the global electronics industry, and we believe even more strongly in the quality of our people and of our Company. Accordingly, notwithstanding this severe global electronics industry downturn, we are proceeding vigorously and enthusiastically with our plans and with our mission. As you may have noted, during the last couple of months, we announced the major expansion of our Singapore manufacturing facility, a new venture into China and the expansion of our RF/microwave business in North America. As we have also indicated, we are proceeding to complete our major North American expansion program with no delay. Anybody can talk about being committed to their business. Our actions demonstrate our commitment to our business in these very difficult times. In addition, and even more importantly, we have not and will not compromise our commitment to working very, very hard every day to help our customers around the world succeed. As I have indicated over and over again, it is fundamental to our nature to do this. Helping customers succeed is what we do. Our strategy is to work in the trenches every day to help our customers be more successful. That is our strategy in good times and that is our strategy in times of deep industry distress. These things do not change for us. So, we do not know when the industry will recover. All we do know is that it will recover strongly at some point in the future and that we will be ready when the recovery does occur. We will be ready because we are not sitting idle waiting for the recovery to occur. We are working every day to improve and build our Company for the future, and to help our customers succeed!”

The Company will host a conference call to discuss its financial results at 11:00 a.m. EDT today. Forward-looking and other material information may be discussed in this conference call. The conference call dial-in number is (800) 818-5264.

Certain portions of this press release may be deemed to constitute forward looking statements that are subject to various factors which could cause actual results to differ materially from Park’s expectations. Such factors include, but are not limited to, general conditions in the electronics industry, Park’s competitive position, the status of Park’s relationships with its customers, economic conditions in international markets, the cost and availability of utilities, and the various factors set forth under the caption “Factors That May Affect Future Results" after Item 7 of Park’s Annual Report on Form 10-K for the fiscal year ended February 25, 2001.

Park Electrochemical Corp. is a leading global designer and producer of electronic materials used to fabricate complex multilayer printed circuit boards and interconnection systems. Park specializes in advanced materials for high layer count circuit boards and high speed digital broadband telecommunications, internet and networking applications. Park’s electronic materials business operates through fully integrated business units in Asia, Europe and North America. The Company’s manufacturing facilities are located in Singapore, China (operations expected to commence in the Company’s third quarter), Germany, France, England, Massachusetts, Connecticut, New York, Arizona and California. Park’s electronic materials business operates under the “Nelco” name.

Additional corporate information is available on the World Wide Web at http://www.parkelectro.com.

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Park Electrochemical Corporation48 So. Service Road, Suite 300MelvilleNY11747

(631) 465-3600Fax: 465-3100

Copyright 2001 (c) All Rights Reserved. Park Electrochemical Corp.