Park Aerospace Q3 2026 Park Aerospace Corp Earnings Call | AllMind AI Earnings | AllMind AI
Q3 2026 Park Aerospace Corp Earnings Call
Speaker #1: Good morning. My name is Shomali, and I'll be your conference operator today. At this time, I would like to welcome everyone to the PARK AEROSPACE CORP third quarter fiscal year 2026 earnings release conference call and investor presentation.
Operator: Good morning. My name is Shomali, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Park Aerospace Corp, Q3 Fiscal Year 2026 earnings release conference call and investor presentation. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, simply press star, then the number two. Thank you.
Speaker #1: All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star, then the number one, on your telephone keypad.
Speaker #1: If you would like to withdraw your question, simply press star, then the number two. Thank you. At this time, I will turn today's call over to Mr. Brian Shore, Chairman and Chief Executive Officer.
At this time, I will turn today's call over to Mr. Brian Shore, Chairman and Chief Executive Officer. Mr. Shore, you may begin your conference.
Speaker #1: Mr. Shore, you may begin your conference.
Brian Shore: Thank you, Operator. Welcome, everybody. Happy New Year. This is Brian. Welcome to the Park Aerospace Corp Fiscal Year 2026 Q3 investor conference call.
Speaker #2: Thank you, Operator. Welcome, everybody. Happy New Year. This is Brian. Welcome to the PARK AEROSPACE CORP fiscal year 2026 third quarter investor conference call.
Speaker #2: I have with me, as usual, Mark Esquivel, our President and CEO—correction, COO. I gave you a promotion there, Mark, sorry. And just some housekeeping stuff: we announced or released our third quarter earnings release, or published our third quarter earnings release, right after close.
I have with me, as usual, Mark Esquivel, our President and CEO, correction, COO. I gave you a promotion there, Mark. Sorry. And just so a little housekeeping stuff, we announced or released our Q3 earnings release or published our Q3 earnings release right after close. You want to get a hold of that because in the release, there's link information to access the presentation we're about to go through. Presentation's also posted on our website. So we have a lot to cover when we get started.
Speaker #2: You want to get a hold of that because, in the release, there's a link with information to access the presentation we're about to go through. The presentation is also posted on our website.
Speaker #2: So we will not cover when I get started. We have our dilemma. We have a lot of new investors, a lot of veteran investors.
We have our dilemma. We have a lot of new investors, a lot of veteran investors. So how much do we cover? The background stuff is always a little bit of an issue. We'll do the best we can. Also, I just want to mention that we did file an S-3 registration statement with the SEC after the close as well.
Speaker #2: So how much do we cover the can? Also, I just want to—always a little bit of an issue. We'll do the best. We mentioned that we did file an background stuff, it's S-3 registration statement, with the SEC after the close as well.
Speaker #2: So, we're going to get started with the presentation. We have a lot to cover. Obviously, at the end of our presentation, we'll be happy to take any questions you might have.
So we're going to get started with the presentation. We have a lot to cover. Obviously, at the end of our presentation, we'll be happy to take any questions you might have. So let's plow ahead. Slide two, forward-looking disclaimer. If you have any questions about this language, please let us know. Let's go on to Slide 3, table of contents, fiscal year 2026 Q3 investor presentation. We're about to go through that. And then the supplementary financial information in Appendix one.
Speaker #2: So, let's plow ahead. Slide two: forward-looking disclaimer. If you have any questions about this language, please let us know. Let's go on to slide three: table of contents.
Speaker #2: Fiscal year '26, a Q3 investor presentation. We're about to go through that. And then to supplementary financial information and Appendix One. We're not going to review that or cover it, but if you have any questions about it, please let us know.
We're not going to review that or cover it, but if you have any questions about it, please let us know. As has become our practice in recent quarters, we're featuring the James Webb Space Telescope, runaway supermassive black hole, 10 million times the mass of the Sun.
Speaker #2: As has become our practice in recent quarters, we're featuring the James Webb Space Telescope, and a runaway supermassive black hole, 10 million times the mass of the Sun.
Speaker #2: That sounds pretty big to me. Being boosted from its galaxy at 1,000 kilometers per second, which is about 2 million miles an hour.
That sounds pretty big to me, being boosted from its galaxy at 1,000 kilometers per second, which is about 2 million miles an hour. Thank you, James Webb Space Telescope. The James Webb was produced with 18 Park proprietary Sigma Struts. James Webb is now orbiting, I think it's called Lagrange orbit, about a million miles from Earth.
Speaker #2: Thank you, James Webb Space Telescope. The James Webb was produced with 18 PARC proprietary Sigma struts. James Webb is now orbiting—I think it's called a Grange orbit—about a million miles from Earth.
Okay. Let's go on to slide four, our quarterly results. Let's just focus on Q3, the quarter we just announced: sales $17.333 million gross profit $5.903 million gross margin 34.1%, adjusted EBITDA $4.228 million adjusted EBITDA margin 24.4%. We're not going to go over the history, but we provide it to you for perspective to Park quarters. I mean, what do we say about Q3, about our Q3, the quarter we just announced during our 9 October 2025 Q2 investor call? Sales estimate was $16.5 million-17.5 million.
Speaker #2: Okay. Let's go on to slide four. Our quarterly results. Let's just focus on Q3. What we just announced, the sales. 17 million 333,000. Gross profit, 5 million 903,000.
Speaker #2: Gross margin, 34.1%. Adjusted EBITDA, $4,228,000. Adjusted EBITDA margin, 24.4%. We're not going to go over the history, but we provide that to you for perspective.
Speaker #2: The PARC quarters, I mean, what do we say about Q3, about our Q3, the quarter we just announced during our October 9, 2025, Q2 investor call?
Speaker #2: Sales estimate, 16 and a half to 17 and a half million. So we came in within that range. Adjusted EBITDA estimate was 3.7 million to 4.1 million.
So we came in within that range. Adjusted EBITDA estimate was $3.7 million-4.1 million. So we came in a little bit above that range. Just want to remind you that when we provide you with these estimates, we don't do what's called guidance that I guess everybody else does, almost everybody else does. When we tell you, we give you an estimate. We are telling you, Mark and I are telling you what we think will happen.
Speaker #2: So, we came in a little bit above that range. Just want to remind you that when we provide you with these estimates, we don't do what's called guidance that, I guess, everybody else does—almost everybody else does.
Speaker #2: When we tell you, we give you an estimate, we are telling you what Mark and I are telling you, what we think will happen. We don't provide any fudge room.
We don't provide any fudge room so we can reduce our what we think by 10% so we can come in and beat the number and be heroes. We don't get involved in that kind of stuff. So I just want to always remind you when we talk about our estimates, what they mean, what they don't mean. Okay. Let's go on to slide five.
Speaker #2: So, we can reduce what we think by 10% so we can come in and beat the number and be heroes. We don't get involved in that kind of stuff.
Speaker #2: So I just want to always remind you, when we talk about our estimates, what they mean, what they don't mean. Okay, let's go on to slide five.
Speaker #2: Quarterly results can continue in this. The Q3 considerations. All right, we always have to talk about the Erie Group Business Partner Agreement because it has an impact upon our quarters.
Quarterly results continuing this, the Q3 considerations. All right. We always have to talk about the ArianeGroup business partner agreement because it has an impact upon our quarters. It gets a little tedious, but I think we need to explain it. We entered into a business partner agreement with ArianeGroup. They're a wonderful French company. We've known them for about 20 years. They're, I think, a JV between Safran and Airbus, a large company.
Speaker #2: I guess it's a little tedious, but I think we need to explain it. We entered into a business partner agreement with Erie Group. They're a wonderful French company.
Speaker #2: We've known them for about 20 years. They're, I think, a JV between Safran and Airbus—large company. That was in January of 2022, under which Erie appointed PARC as its exclusive North American distributor for their Raycar or C2B fabric used to produce a blade of composite materials for advanced missile programs.
That was in January 2022, under which ArianeGroup appointed Park as its exclusive North American distributor for their Raycarb C2B fabric used to produce ablative composite materials for advanced missile programs. So this is a lot of people consider it to be the Cadillac of this category of fabric that's used for ablative cycles sometimes for missile programs.
Speaker #2: So this is, a lot of people consider, to be the Cadillac of this category of fabric that's used for blades that call sometimes for missile programs.
Speaker #2: So this is why we have to talk about it, because—let's just go into it—we had zero sales of the fabric in Q3.
So this is why we have to talk about it because let's just go into it. We had zero sales of the fabric in Q3. OEMs buy the fabric or stockpile the fabric because they're trying to protect their very critical missile programs, but they have to buy it from us since we're the exclusive distributor in North America. The OEMs, we buy the fabric from ArianeGroup, our partner, and then we resell it or sell it, rather, to the OEMs for a small markup, all right?
Speaker #2: OEMs buy the fabric, or stockpile the fabric if you're trying to protect very critical missile programs, but they have to buy it from us since we're the exclusive distributor.
Speaker #2: North America. The OEMs—we buy the fabric from Erie, our partner, and then we resell it, or sell it rather, to the OEMs for a small markup, all right?
And we don't even deliver it to the OEMs. We store the product, the fabric in our factory as a favor to them, I guess, because ultimately, they don't need it. They're going to give us the releases at some point to go ahead and take that fabric and produce the prepreg material with it. So small markup.
Speaker #2: And we don't even deliver it to the OEMs. We store the product—the fabric—in our factory as a favor to them, I guess.
Speaker #2: Because ultimately, they don't need it. They're going to give us the releases at some point to go ahead and take that fabric and produce the preprint material with it.
Speaker #2: So, small markup. I probably shouldn't have put this print in here because it's not going to explain it. Even smaller, as I presented, considering tariffs.
I probably shouldn't have put this print in here because it's not going to explain it. Even smaller as a percentage considering tariffs. This is because we pass through all the tariffs, and they're significant, but you pass them through on a dollar-for-dollar basis. They go into our sales line, but we don't provide a markup on the tariffs. That would be kind of ridiculous. So that actually makes the markup percentage even lower, if you follow what I'm saying.
Speaker #2: This is because we pass through all the tariffs, and they're significant, but you pass through on a dollar-for-dollar basis. They go into our sales line, but we don't provide a markup on the tariffs—that would be kind of ridiculous.
Speaker #2: So that actually makes the markup even percentage even lower, if you follow what I'm saying. We sold, so we had zero sales of fabric in Q3, and we had a little bit more than a million dollars of sales of the materials manufacturing with C2B product in Q3.
So we had zero sales of fabric in Q3, and we had a little bit more than $1 million of sales of the materials manufactured with C2B product in Q3. So when we produce the prepreg, that actually results in very good margins. So when we have significant sales of material, not too significant fabric, that's actually a plus for our bottom line.
Speaker #2: So when we produced the preprint, that actually results in very good margins. So when we have significant sales of material—not too significant fabric—that's actually a plus for our bottom line.
Speaker #2: But the opposite often happens, and we'll talk about that when we talk about our Q4 forecast. We have a lot of sales of fabric, not as much in materials that will drive down our margins.
But the opposite often happens, and we'll talk about that when we talk about our Q4 forecast. We have a lot of sales of fabric, not as much of materials that will drive down our margins. It's all good. It's all wonderful. It's ultimately everything that we, all the fabric that we sell to the OEMs and they stockpile, we will end up producing. That's the reason we keep it in our factory. But the timing kind of distorts our quarter sometimes. That's what we have to talk about, unfortunately.
Speaker #2: It's all good. It's all wonderful. It's ultimately everything that we, all the fabric that we sell to the OEMs and they stockpile, we will end up producing.
Speaker #2: That's the reason we keep it in our factory. But the timing kind of distorts our quarters sometimes. That's what we have to talk about, unfortunately.
Let's go on to Slide 6. Total missed shipments in Q3, approximately 740,000. That number's up quite a bit. It was caused principally by international freight supply chain and customer spec and engineering issues. So what was going on here? Industry challenges are reemerging as industry recovers and program ramps accelerate. This is actually a good thing, good news.
Speaker #2: Let's go on to slide six. Total missed shipments in Q3: approximately 740,000. That number's up quite a bit. It was caused principally by international freight supply chain and customer spec and engineering issues.
Speaker #2: So, what was going on here? Industry challenges are reemerging as the industry recovers and program ramps accelerate. This is actually a good thing—good news.
Speaker #2: After the pandemic, or when the pandemic started, it was a mess because the supply chain was so screwed up. And after a couple of years, we kind of got back to something that would be more acceptable.
After the pandemic or when the pandemic started, it was a mess because the supply chain was so screwed up. And after a couple of years, we kind of got back to something that would be more acceptable, which is okay. But now that the industry is recovering and the programs are ramping quickly, now the supply chain and the industry is actually getting a little bit behind the power curve again. That's what's going on there. So actually, it's good news. That impact of tariffs and tariff-related costs and charges, maybe Mark can help us with this. Go ahead, Mark.
Speaker #2: Which is okay, but now that the industry is recovering and the programs are ramping quickly, now the supply chain and the industry are actually getting a little bit behind the power curve again.
Speaker #2: That's what's going on there. So actually, it's good news. That impact of tariffs and tariff-related costs and charges—maybe Mark can help us with this.
Speaker #2: Go ahead, Mark. Yeah, this is a very eventful update again, which is, I think, a good thing. We have minimal impact on tariffs in our Q3, just as we've had previously.
Mark Esquivel: Yeah. This isn't a very eventful update again, which is, I think, a good thing. We have minimal impact on tariffs in our Q3, just as we've had previously. And I think we talked about it.
Speaker #2: And I think we talked about it. We priced our materials on a short-term basis, most of our business, so we're able to pass them on.
We price our materials on a short-term basis, most of our business, so we're able to pass them on if we do get them. The second bullet, possible future of impact. Again, this has been quiet again for us the last few months, or it seems to stabilize as far as what's coming our way. That doesn't mean there could be changes to that. But as far as the near term, I probably think the bullet would be pretty similar to the first one going forward in the next few quarters. But you just never know, but there's minimal impact for PARK at this point.
Speaker #2: If we do get them, the second bullet—possible future impacts—again, this has been quiet for us the last few months, or it seems to have stabilized as far as what's coming our way.
Speaker #2: That doesn't mean there couldn't be changes to that, but as far as the near term, I probably think the bullet would be pretty similar to the first one.
Speaker #2: Going forward in the next few quarters, but you just never know. But there's minimal impact for PARC at this point.
Brian Shore: Okay. Thanks, Mark. Let's go on to Slide 7. We'll keep moving here. This is a slide that our veteran investors are familiar with.
Speaker #1: Okay, thanks, Mark. Let's go on to slide seven. We keep moving here. This is a slide that our veteran investors are familiar with. Every quarter we share with you our top five customers, and we do a little picture that's associated with each of these companies—the top five companies, alphabetically.
Every quarter, we share with you our top five customers, and we do a little picture that's associated with each of these companies, the top five companies alphabetically. The 737 MAX, we've said in the past we don't have much content on that. That's actually Noriam. That's a WeatherMaster radome that Noriam produces for the 737 product line. So what else do you want to talk about here? I guess maybe oh, the Valkyrie. Yeah. So we've talked about the Valkyrie quite a bit over the last few years.
Speaker #1: The 737 MAX, we've said in the past, we don't have much content on that. That's actually Noriam. That's a weather master radome that Noriam produces for the 737 product line.
Speaker #1: So, what else do you want to talk about here? I guess, maybe—oh, the Valkyrie. Yeah. So we've talked about the Valkyrie quite a bit.
Speaker #1: Over the last few years, this is a Kratos program that we're on, but USM—the recent news is the Marine Corps just selected a Valkyrie for its collaborative combat aircraft program, Loyal Wingman.
This is a Kratos program that we're on. But the recent news is the Marine Corps just selected the Valkyrie for its collaborative combat aircraft program, Loyal Wingman, sometimes it's called. So that's very good news for Kratos and also for Park. The PAC-3, that is an AAA item. And the Airbus A220. That's obviously Middle River.
Speaker #1: Sometimes it's called—so that's very good news for Kratos, and also for PARC. The PAC-3—that is an AA item—and the Airbus A320neo, that's obviously Middle River.
Speaker #1: Sikorsky is Sikorsky, and Noriam we already talked about. Which program is associated with Noriam? Let's go on to slide eight, our pie chart here.
Sikorsky, Sikorsky, and Nordam, we already talked about which program is associated with Nordam. Let's go on to Slide 8, our pie chart here. So the comment is always that if you look at fiscal 2021, which is really the pandemic year, the pie chart's quite different. The other year is kind of very similar year over year. People ask if the military piece of the pie chart will grow. It might. But commercial's growing too, so we're not sure. My expectation would be that business aircraft as a percentage would maybe shrink over time.
Speaker #1: So, the comment is always that, if you look at fiscal '21, which is really the pandemic year, the pie chart's quite different. The other years are kind of very similar.
Speaker #1: Year over year. People ask if the military piece of the pie chart will grow, and it might. But commercial is growing too, so we're not sure.
Speaker #1: My expectation would be that business aircraft as a percentage would maybe shrink over time. So let's go to slide nine. PARC LUZ, niche military aerospace programs.
So let's go to Slide 9, Park's, Niche Military Aerospace Programs. This is a slide that we include every quarter as well. These are not necessarily the biggest military programs we're on. These are just things we want to share with you.
Speaker #1: This is a slide that we include every quarter as well. And these are not necessarily the biggest military programs we're on. These are just things we share with you.
Speaker #1: As we mentioned in the last couple of quarters, we feel less comfortable giving many specifics about these programs, but these are all programs that PARC is in or is associated with.
As we mentioned in the last couple of quarters, we feel less comfortable giving many specifics about these programs, but these are all programs that Park is associated with. Let's see. The only thing that I would mention in terms of recent news is the standard missile SM-6 program. The Navy just awarded Raytheon a contract to boost the SM-6 production. This is all public, so you can look it up yourself. I don't think we need to comment on any other programs here.
Speaker #1: Let's see. The only thing that I would mention in terms of recent news is the Standard Missile 6, SM-6, program. The Navy just awarded Raytheon a contract to boost the SM-6 production.
Speaker #1: This is all public, so you can look it up yourself. I don't think we need to comment on any other programs here. Let's go on to—sorry, I got to find slide 10—slide 10.
Let's go on to, sorry, I'm trying to find Slide 10. Slide 10. This is another slide that we've included for probably, I don't know, a dozen presentations. So a lot of you are very familiar with it. No real change to it. GE Aerospace Jet Engine Programs, major program opportunity for Park.
Speaker #1: This is another slide that we've included for probably, I don't know what, a dozen presentations. So a lot of you are very familiar with it.
Speaker #1: No real change to it. GE Aerospace jet engine programs are a major program opportunity for PARC. Firm pricing LTA. From 2019 to 2029 with Middle River Air Structure Systems, MRAS, which is currently a subsidiary of SD Engineering Aerospace, a Singapore aerospace company.
Firm Pricing LTA from 2019 to 2029 with Middle River Aerostructure Systems, MRAS, which is currently a sub of ST Engineering Aerospace, a Singapore aerospace company. But when we got on these programs, they were a sub of GE Aviation, now GE Aerospace. That's why these programs relate to GE engines or CFM engines. We built a redundant factory for them in exchange for agreeing to give us the LTA through 2029. What programs are we talking about?
Speaker #1: But when we got all these programs there, we're a sub of GE Aviation—now GE Aerospace. That's why these programs are all related to GE engines or CFM engines.
Speaker #1: We built a redundant factory for them in exchange for agreeing to give us the LTA through '29. What programs are we talking about? The first, if we look at the bottom left side of the page, the first five are all A320neo aircraft family programs.
If we look at the bottom left side of the page, the first five are all A320neo aircraft family programs. They all have the same engine, LEAP-1A engine, which is a CFM engine. The 747-8, that airplane's no longer being produced, but there's still spares that were involved with COMAC C919. COMAC is a Chinese aircraft company with LEAP-1C engines.
Speaker #1: They all have the same engine, the LEAP-1A engine, which is a CFM engine. The 747-8, that airplane is no longer being produced. But there are still spares that were involved with the COMEC-919.
Speaker #1: COMAC is a Chinese aircraft company with LEAP-1C engines. The 919 is COMAC's offering to compete in the single-aisle market against the 737 and A320.
The C919 is COMAC's offering to compete with single aisle to compete with the 737 and the A320. On the right-hand side of the page, the C909, that's also a COMAC aircraft. And that's a regional jet. And that also has a GE engine, of course, the Bombardier Global 7500, Passport 20 engine. The picture here is the 747A. As you can see, engine nacelles. We like this picture because it just gives you a perspective on the size of these nacelles.And everything you see there is made with Park material. And a lot of what you don't see inside the nacelles is made with Park material as well on that 747 program.
Speaker #1: On the right-hand side of the page, the 909—that's also a COMEC aircraft. And that's a regional jet. And that also has a GE engine, of course.
Speaker #1: The Bombardier Global 7500, Passport 20 engine. The picture here is the 747-8, as you can see, engine installs. We like this picture because it just gives you a perspective on the size of these nacelles, and everything you see there is made with PARC material.
Speaker #1: And a lot of what you don't see inside the nacelles is made with PARC material as well, on that 747 program. Let's go on to slide 11.
Let's go on to Slide 11. So more on GE Aerospace. We're continuing. Let's skip the first item. Second item, the in-case containment rack. This is for the 777X, GE9X engines for 777X.
Speaker #1: So, more on GE Aerospace. We're continuing. Let's skip the first item. Second item: Vancase Containment RAP. This is for the 777X, GE9X engines for 777X.
Speaker #1: That's produced with our AFP material and other composite materials. And let's go on to the third item. MRAS PARC LTA, which we already mentioned, was amended to include three proprietary PARC film adhesive formulation product forms.
That's produced with our AFP material and other composite materials. Let's go on to the third item, MRASPARC LTA, which we already mentioned, was amended to include three proprietary PARC film adhesive formulation product forms. The last item, LIFOR program agreement, which was requested by MRAS and ST Engineering. Remember, ST Engineering is the owner of MRAS now. We've said agreement is under negotiation for a few quarters now. But this time, it's on us because the MRAS team wanted to get together with us in December.
Speaker #1: And the last item, the LIFRA program agreement, which was requested by MRAS and SDE. Remember, SDE is the owner of MRAS now. And we've said the agreement is under negotiation for a few quarters now.
Speaker #1: But this time, it's on us. Because the MRAS team wanted to get together with us in December, and then we said, 'Look, we really have to focus on this expansion.' And this expansion is for their benefit.
Then we said, "Look, we're really going to focus on this expansion." And this expansion is for their benefit. So we said, "Can we delay the next meeting on the LIFOR program a couple of months?" And they said, "Fine." So that one's on us. We can't blame anybody except us, the fact that this is still an open item.
Speaker #1: So we said, 'Can we delay the next meeting on the LIFRA program a couple of months?' And they said, 'Fine.' So that one's on us.
Speaker #1: We can't blame anybody except us. The fact that this is still an open item. As we said previously, we would love to have the LIFRA program, but we're okay either way.
As we said previously, we'd love to have the LIFOR program, but we're okay either way. Let's go on to Slide 12. Continuing with the update on the, this is now updated, in GE Aerospace jet engine program. So let's start with the A320neo aircraft family. That's the big dog of all the GE Aerospace programs that we're on. As of 25 November, Airbus had already delivered 4,275 A320neo aircraft.
Speaker #1: Let's go on to slide 12, continuing with the update. This is now updated on GE Aerospace Jet Engine Programs. So let's start with the A320neo.
Speaker #1: Aircraft family. That's the big dog of all the GE Aerospace programs that we're on. As of November '25, Airbus had already delivered 4,275 A320neo aircraft.
Speaker #1: And Airbus has a huge backlog of these aircraft—7,900 as of, I guess, September. That's a total of over, when you look at how many were delivered and what's in the backlog, a total of over 12,000 airplanes.
Airbus has a huge backlog of these aircraft, 7,900 as of, I guess, September. That's a total of over 12,000 airplanes when you look at how many were delivered and what's in the backlog. That's huge. Look at the delivery history here, the bottom half of the slide. We won't go through the numbers.
Speaker #1: That's huge. And look at the delivery history here. At the bottom of the bottom half of the slide—we won't go through the numbers.
Speaker #1: But you could kind of see what happened is that they were ramping up as the program was growing, and then it hit the pandemic and kind of hit a brick wall, and the ramp-up was slowed down a little bit.
But you could kind of see what happened is that they were ramping up as the program was growing, and then hit the pandemic, and it kind of hit a brick wall. And the ramp-up was slowed down a little bit. I think they're ramping up much more aggressively now. In December 2025, they delivered 97 airplanes, which is a lot, but they plan to deliver even more. You're probably right about this, but the A320neo has issues with fuselage panels and also software that was caused by solar activities, which reduced the deliveries.
Speaker #1: I think they're ramping up much more aggressively now. In December of '25, they delivered 97 airplanes, which is a lot, but they plan to deliver even more.
Speaker #1: You're probably right about this, but the A320neo has issues with fuselage panels and also software that was caused by solar activities, which reduced the deliveries.
Those issues have been resolved, but nevertheless, they probably held back the deliveries in 2025. Let's go on to Slide 13. This is the key thing. Airbus is targeting a delivery rate of 75. Remember, we had 50, 51, 75 per month in 2027.
Speaker #1: Those issues have been resolved, but nevertheless, they're probably held back to deliveries in '25. Let's go on to slide 13. This is the key thing.
Speaker #1: Airbus is targeting a delivery rate of 75—remember what? 50, 51, 75 per month in 2027. That’s obviously doing the math of a 15% increase over where we are now, which is a lot.
That's obviously, doing the math, a 15% increase over where we are now, which is a lot, considering it's a very large program. It's 50% of a lot. On 7 October 2025, the A320 aircraft family became the world's most delivered commercial jet that was surpassing the 737. A320 aircraft family continues to rack up new orders. The game-changing A321XLR, we've spoken about this a lot in the last few quarters. Maybe I won't go through each item, but if you have questions about it, please let us know.
Speaker #1: Considering it's a very large program. It's 50% of a lot. On October 7, ’25, the A320 aircraft family became the world’s most delivered commercial jet.
Speaker #1: That was surpassing the 737. And the A320 aircraft family continues to rack up the orders. The game-changing A321XLR—we've spoken about this a lot in the last few quarters.
Speaker #1: Maybe I won't go through each item, but if you have questions about it, please let us know. This is a pretty exciting, game-changing aircraft for Airbus.
This is a pretty exciting, game-changing aircraft for Airbus. And this is part of the A320neo family. I just want you to understand that. Were there approved engines for the A320neo aircraft family? There are two of them. One is the CFM LEAP-1A engine. That's the program we're on.
Speaker #1: And this is part of the A320neo family. I just want you to understand that. We're the approved engines for the A320neo aircraft family. There are two of them.
Speaker #1: One is the CFM LEAP-1A engine—that's the program we're on. The other one is a Pratt & Whitney GTF engine, the PW1100G engine. We're not involved in the Pratt program, only the CFM program.
The other one is a Pratt & Whitney GTF engine, PW 1100G engine. We're not involved in the Pratt program, only the CFM program. On Slide 14, we supply into the, well, we just talked about the first item, the first bullet item, okay? Second bullet item. So basically, if you look at the market share of firm engine orders between the CFM LEAP-1A and the Pratt engine, and this is for the A320 program, of course, the CFM LEAP engine has a 64.5% market share, much more than half.
Speaker #1: On slide 14, we supply into the well, I just talked about the first item—the first item, okay? Second bullet item: so basically, if you look at the market share, firm engine orders between the CFM LEAP-1A and the Pratt engine, and this is for the A320 program, of course—the LEAP CFM LEAP engine has a 64.5% market share.
Speaker #1: Much more than half, so, and it has been that way for a while. The LEAP market share is much more than the Pratt market share, which is good for PARC because we're on the LEAP program and not the Pratt program.
And it has been that way for a while. The LEAP market share is much more than the Pratt market share, which is good for PARC because we're on the LEAP program and not the Pratt program. At that delivery rate of 75 airplanes per month, that 64.5% market share translates into a lot of engines per year, 1,161.
Speaker #1: At that delivery rate of 75 airplanes per month, that 64.5% market share translates into a lot of engines per year—1,161. Just so you understand, this 64.5% is based upon all orders, all backlog for both engines.
Just so you understand, this 64.5% is based upon all orders, all backlog for both engines. We're talking about thousands and thousands and thousands of airplanes. So it's not a number that's easily distorted by kind of a small perspective, a short timeframe perspective. Let's keep going. The Pratt engine, unfortunately, continues to struggle with serious reliability issues. I just read an article this morning that these reliability issues are expected to continue. Now, for the LEAP engine, reliability has been a selling point. Reliability is a very, very key thing for an airline.
Speaker #1: We're talking about thousands and thousands and thousands of airplanes. So it's not a number that's easily distorted by kind of a small perspective, a short timeframe perspective.
Speaker #1: Let's keep going. The Pratt engine, unfortunately, continues to struggle with serious reliability issues. I just read an article this morning that these reliability issues are expected to continue.
Speaker #1: Now, for the LEAP engine, reliability has been a selling point. Reliability is a very, very key thing for an airline. Reliability relates to how much downtime an airplane has related to maintenance.
Reliability relates to how much downtime an airplane has related to maintenance. So if these airplanes are down for maintenance or inspections for these engines, that's a real bad problem. The airplanes are grounded. They're not making money. And airlines, their margins aren't that great. They cannot afford to have excess downtime.
Speaker #1: So if these airplanes are down for maintenance or inspections for these engines, that's a real bad problem. Because when the airplanes are on the ground, they're not making money, and airlines—their margins aren't that great.
Speaker #1: They cannot afford to have excess downtime, and that's why the reliability issues are real, serious problems. I don't know what's going to happen, but when I even speculate that, because reliability continues to be a problem with Pratt and the CFM LEAP is doing well with reliability, that could drive the market share potentially even more to the LEAP side of the ledger.
And that's why the reliability issues are a real serious problem. I don't know what's going to happen, but we might even speculate that because reliability continues to be a problem with Pratt and the CFM LEAP is doing well with reliability, that could drive the market share potentially even more to the LEAP side of the ledger. CFM has significantly ramped up production deliveries of LEAP engines, including LEAP-1A. That's really significant because we talked about supply chain restrictions, holding back the market, holding back deliveries.
Speaker #1: CFM has significantly ramped up production deliveries of LEAP engines, including the LEAP-1A. That's really significant because we talked about supply chain restrictions holding back the market, holding back deliveries.
There were a lot of different things, but what was often mentioned most often were engines. So the fact that CFM is leaping up—I'm sorry—ramping up the LEAP engine is a good thing because that will help Airbus ramp up the A320neo program, which is, of course, what we want. Slide 15. What are we doing here?
Speaker #1: There are a lot of different things, but what was often mentioned most often were engines. So the fact that CFM is leaping up, leaping up, sorry, ramping up the LEAP engine is a good thing.
Speaker #1: Because that will help Airbus ramp up the A320neo program, which, of course, is what we want. Slide 15. What are we doing here? As of September 30th, '25, there were 7,900 firm LEAP-1A.
As of 30 September 2025, there were 7,900 firm LEAP-1A. See what I'm talking about? These are a lot of—these are a lot of engine orders, firm LEAP-1A engine orders. So we were recently told that our customer was given indication as to how many nacelles, basically. That's where they produce nacelles. They need to plan to produce for this program. And we can't disclose that number, but it is significantly more than 7,900, significantly more.
Speaker #1: See, so I'm talking about these—a lot of these are a lot of engine orders. Firm LEAP-1A engine orders. So we were recently told that our customer was giving an indication as to how many engines, how many cells, basically.
Speaker #1: That's what they produce—the cells. They need to plan to produce for this program. And we can't disclose that number, but it is significantly more than 7,900.
Speaker #1: Significantly more. The A320neo aircraft family program can end up being our largest program. We'll see, but over the long—over the course of the program, it could be, I don't know.
The A320neo aircraft family program could end up being our largest program. We'll see. But over the course of the program, it could be. I don't know. Everybody has a different opinion about this, but I'll give you my opinion, which is probably not worth much. But my opinion is that Airbus will be making these airplanes with these engines in 2040. We'll see if I'm wrong or right.
Speaker #1: Everybody has different opinions about this, but I'll give you my opinion, which is probably not worth much. But my opinion is that Airbus will be making these airplanes with these engines in 2040.
Speaker #1: We'll see if I'm wrong or right. COMAC 919, this is a Chinese aircraft, single aisle. We talked about that. It also has a LEAP engine.
COMAC C919 is a Chinese aircraft. Single aisle, we talked about that. It also has a LEAP engine, LEAP-1C. This is the single aisle to compete against the 737 and the A320. COMAC is expected to fall short of its 2025 delivery target. Not surprising. It's a Chinese company. So sometimes they have historically had some trouble kind of getting the programs up and going. Target shortfall, they say it's caused by supply chain, whatever, international production issues, international trade production issues. So I don't know.
Speaker #1: LEAP-1C. And this is the single-aisle to compete against the 737 and the A320. Comac is expected to fall short of its 2025, 225 delivery target.
Speaker #1: Not surprising. It's a Chinese company, so sometimes they have historically had some trouble kind of getting their programs up and going. Target shortfall—they say it's caused by supply chain, whatever.
Speaker #1: International production issues, international trade production issues. So, I don't know. Let's just go on to the next slide. I don't think we need to be—well, let's go on to the next slide.
Let's just go on to the next slide. I don't think we need to be, let's go on to the next slide. We're still on the C919. COMAC is increasing manufacturing capacity to achieve production rates of 150 in 2027, 200, and 2029. Now, if you look at that juggernaut slide further down in the presentation, we're assuming 150.
Speaker #1: We're still on the 919. COMAC is increasing manufacturing capacity to achieve production rates of 150 and 27, 200, and 29. Now, if you look at that juggernaut slide further down in the presentation, we're assuming 150.
Speaker #1: We're assuming a top set of 150, but Comac is building capacity for 200 per year. Comac reportedly has over 1,200 orders for the 919.
We're assuming a top set of 150. But COMAC is building capacity for 200 per year. COMAC reportedly has over 1,200 orders for the 919. Now, let's look at the 909. This is a regional jet, and again, produced by COMAC with a GE engine, a different type of GE engine, of course. So according to the state-run Global Times, 175 909s have been delivered. The 909 operating routes have expanded to 12 Asian countries, which is good because originally, these airplanes were thought to be China-only airplanes.
Speaker #1: Now, let's look at the 909. This is a regional jet, and again, produced by Comac with a GE engine—a different type of GE engine, of course.
Speaker #1: So, according to the state-run Global Times, 175 909s have been delivered. The 909 operating routes have expanded to 12 Asian countries, which is good.
Speaker #1: Because originally, these airplanes were thought to be, well, China-only airplanes. That's obviously not happening. I mean, Comac doesn't want it to happen anyway. 909 aircraft now carry over 30 million passengers.
That's obviously not happening. I mean, COMAC doesn't want that to happen anyway. 909 aircraft now carry over 30 million passengers. That's a lot of passengers in these small airplanes. There were approximately 385 open orders. So here's a good thing to talk about because this aircraft has been at rate for a couple of years.
Speaker #1: That's a lot of passengers in these small airplanes. There were approximately 385 open orders. So here's a good thing to talk about.
Speaker #1: Because this aircraft has been in rate for a couple of years. So it took Comac a while to get to rate, but they're at rate.
So it took COMAC a while to get to rate, but they're at rate. They got there. That's the key thing. So with the 919, maybe it'll take a little bit longer for them to get to rate. But my opinion, anyway, is they'll get to rate and it'll be very good for PARC. At least we're starting from basically zero. So let's go to Slide 17. The Bombardier Global 8000 variant, the 7500 variant. It was just certified and first delivery last month. The fastest civilian aircraft since the Concorde, 8,000 nautical mile range.
Speaker #1: They got there. That’s the key thing. So, with the 919, maybe it’ll take a little bit longer from the get to rate, but my opinion anyway is they’ll get to rate, and that’ll be very good for Park.
Speaker #1: These are starting from basically zero. So let's go to slide 17. The Bombardier Global 8000 variant, the 7,500 variant, and it was just certified and first delivery last month.
Speaker #1: The fastest civilian aircraft since the Concorde. 8,000-mile range. This 777X with GE 9X engines. The 777X TEX program has amassed a lot of hours, a lot of flights.
This 777X with GE9X engines. The 777X test program has amassed a lot of hours, a lot of flights. Boeing reportedly has over 600 orders for the aircraft. The certification test program is moving into phase three of the TIA, which is important. I mean, I'm not going to go into what that means.
Speaker #1: Boeing reportedly has over 600 orders for the aircraft. The certification test program is moving into phase three of the TIA, which is important. I mean, I'm not going to know what that means.
Speaker #1: I'm not an expert anyway, but it's an important step along the way to getting the aircraft certified by the FAA. Slide 18 is still on the 777X.
I'm not an expert anyway, but it's an important step along the way to getting the aircraft certified with FAA. Slide 18 is still on the 777X. Boeing now anticipates FAA certification, entering into service, and first delivery of 777X in 2027. This airplane's delayed too, so we can't all just say, "Well, the Chinese are sometimes late with their aircraft." The Boeing CEO has indicated that 777X aircraft and the engines are performing quite well. Mentioned increased FAA scrutiny as a key factor in their certification delay.
Speaker #1: Boeing now anticipates FAA certification, entry into service, and first delivery of the 777X in '27. This airplane is late too, so we can't all just say, 'Well, the Chinese are sometimes late with their aircraft.' The Boeing CEO has indicated that the 777X aircraft and the engines are performing quite well.
Speaker #1: He mentioned increased FAA scrutiny as a key factor in their certification delay. I think what he's really getting at—and I think he wants to be nice about it—is that the FAA is being a little stricter because of the issues with the 737 MAX.
I think what he's really getting at, I think he wants to be nice about it, is that the FAA is being a little stricter because of the issues with the MAX, the 737 MAX. Why don't we go on to Slide 19? Here's some numbers. GE Aerospace programs.
Speaker #1: Going on to slide 19. Here's some numbers. GE Aerospace Program. This is why we emphasize it a lot, because it's a big deal for Park.
This is why we emphasize a lot because it's a big deal for Park, the GE Aerospace jet engine programs. We won't go into the sales history. You can see it here for your benefit. Q3 sales were $7.5 million. Our forecast for Q4, $7.25, $8.7, $3.25, $8.25 million. And for the year, $29 million to $29.5 million, just kind of adding down. And you can see that there's a recovery going on here in fiscal 2020, almost $29 million. Then it just kind of fell off a cliff during the pandemic.
Speaker #1: The GE Aerospace Jet Engine Programs. We won't go into the sales history and see it here for your benefit. Q3, sales were $7.5 million.
Speaker #1: Our forecast for Q4: $7.25 million, $8.7 million, three-quarters, $8.25 million. And for the year, $29 million to $29.5 million, just kind of adding down. And you can see that there's a recovery going on here in fiscal '20.
Speaker #1: Almost $29 million—that kind of fell off a cliff during the pandemic. There's been a real struggle to get back to that level, and it's only now that we're at that level this fiscal year.
There's been a real struggle to get back to that level. And it's only now that we're at that level this fiscal year. And my feeling and sense is that this number is going to move up quite aggressively over the next two or three years. Let's go on to Slide 20. Okay.
Speaker #1: And my feeling and sense is that this number is going to move up quite aggressively over the next two or three years. Let's go on to slide 20.
Speaker #1: Okay, this is now going to be talking about Park, not just GE. This is all Park. Park's financial performance history and forecast estimates. So the top part of the page, in yellow, fiscal year '26, '23.
This is now talking about PARC, not just GE. This is all PARC. PARC's financial performance history and forecast estimates. So in the top part of the page in yellow, fiscal year 2026, 2023, well, we already gave you those numbers. And then we have estimates, forecast estimates. Remember what we said? This is not guidance. This is what Mark and I think is going to happen to rest of our ability. Sometimes it's wrong. Sometimes it's higher. Sometimes it's lower. But we're telling you what we think is going to happen.
Speaker #1: Well, we've already given you those numbers. And then we have estimates—forecast estimates. Remember what we said: these are not, it's not guidance. This is what Mark and I think is going to happen, to the best of our ability.
Speaker #1: Sometimes we're wrong, sometimes it's higher, sometimes it's lower, but we tell you what we think is going to happen. Q4, $23.5 million to $24.5 million.
Q4, $23.5 million to 24.5 million. EBITDA of $4.75 to 5.25. Now, a lot of smart people are thinking, "Well, what's going on here?" Q3 sales were $17.3 million. Q4 sales a lot more. Q3 EBITDA $4.2 million. So why isn't the forecast for Q4 EBITDA a lot more? We have a lot more sales.
Speaker #1: EBITDA of 4.3 quarters of 5.25. Now, a lot of smart people are thinking, 'Well, what's going on here?' Q3 sales were $17.3 million. Q4 sales, a lot more.
Speaker #1: Q3 EBITDA was $4.2 million. So why isn't the forecast for Q4 EBITDA a lot more? We have a lot more sales. Well, you gotta look at the footnote.
Well, you got to look at the footnote. There's two asterisks. Forecasted to include approximately $7.2 million C2B fabric sales. So that's at small market, very, very light margins. And that's what's going on here. That's what you need to understand. That's why, with those kinds of sales, we're not seeing much higher EBITDA numbers. And then while we're at it, let's look at the total for forecast total for 2026. This is just adding down, taking into account the Q4 forecast. $72.5 million to 73.5 million.
Speaker #1: There are two asterisks. Forecasted to include approximately $7.2 million of C2B fabric sales. So that's that small markup—very, very light margins. And that's what's going on here.
Speaker #1: That's what you need to understand. That's why, with those kinds of sales, we're not seeing much higher EBITDA numbers. And then, while we're at it, let's look at the total forecast for '26.
Speaker #1: This is just adding down and taking into account the Q4 forecast—$72.5 million to $73.5 million. And here's your EBITDA number. And again, look at the footnote—three asterisks.
And here's your EBITDA number. And again, look at the footnote, three asterisks. Forecast to include approximately $9.8 million of C2B fabric sales, mostly in Q4, it looks like. All right? Okay. Let's go on to Slide 21. So this is just some history on the right-hand column. The 2026 forecast estimate included. The estimate we just went over with you.
Speaker #1: Forecasted to include approximately $9.8 million of C2B fabric sales. Mostly in Q4, it looks like. All right? Okay, let's go on to slide 21.
Speaker #1: So this is just some history, with on the right-hand column, the '26 forecast estimate included the estimate we just went over with you. So we won't go over that again.
So we won't go over that again. I think what's interesting is look at the top line of sales. Starting in 2017, 2018, 2019, 2020, went up $10 million approximately per year from 2017 to 2020, and then it fell off a cliff. Because there you have the pandemic and the supply chain issues and the industry chaos that resulted for a long time. Even last year in 2025, we still had barely gotten back to that fiscal 2020 number.
Speaker #1: I think what's interesting is to look at the top line, the sales. Starting in '17, '18, '19, '20, they went up about $10 million per year from '17 to '20.
Speaker #1: And then it fell off a cliff. We still have the pandemic, and the supply chain issues, and the industry chaos that resulted for a long time.
Speaker #1: And even last year, in '25, we still had barely gotten back to that fiscal '20 number. Now, we start to see in fiscal '26, we start to see some acceleration, getting out of that rut that the industry has been in for a long time—like five years.
Now we start to see in fiscal 2026, we start to see some acceleration getting out of that rut that the industry has been in for a long time, like five years. It's been a long five years, I would say. So it is what it is, but it's been a long five years. Let's look at the notes down here. Supply chain limitations affecting your airplane industry.
Speaker #1: It's been a long five years, I would say. So, it is what it is. But it's been a long five years. Let's look at the notes down here.
Speaker #1: Supply chain limitations affecting your airplane industry—that's what we just discussed when we looked at the sales numbers. Ramping up, of course, for the juggernaut.
That's what we just discussed. We looked at the sales numbers ramping up, of course, for the juggernaut. And again, reminding you, the fiscal 2025 sales include 7.5 million of C2B fabric, and the 2026 sales include 9.8 million of C2B fabric. Very important to understand those things. Okay? And until now, I should just go back and say the OEMs have been stockpiling lots and lots of C2B fabric, much more than what we're producing in terms of how that would translate into producing, meaning producing prepreg with the C2B fabric.
Speaker #1: And again, reminding you, the fiscal '25 sales include $7.5 million of C2B fabric, and the '26 sales include $9.8 million of C2B fabric. Very important to understand those things.
Speaker #1: Okay? And until now, I should just go back and say the OEMs have been stocked by lots and lots of C2B fabric, much more than what we're producing in terms of how that would translate into producing—meaning producing prepreg with the C2B fabric.
So let's go on to Slide 22. Changing gears a little bit. Our buyback authorization and activity, an update. Okay. So we announced in May 2022. Our board authorized the purchase of 1.5 million shares of our common stock.
Speaker #1: So let's go on to slide 22. Changing gears a little bit—our buyback authorization and activity update. Okay. So we announced in May '22, our board authorized the purchase of 1.5 million shares of our common stock.
Speaker #1: Under this authorization, Park has purchased a total of 718,000 shares of its common stock at an average price of $12.94. So you have to say we're some kind of geniuses.
Under this authorization, Park has purchased a total of 718,000 shares of its common stock at an average price of $12.94. $12.94. So you have to say we're some kind of geniuses, I mean, considering what stock price is now. I mean, I don't know what you think, but we probably should be invited on CNBC or maybe to talk and be a guest lecturer at the Wharton School of Economics. Let's keep going. We don't have to talk about it.
Speaker #1: I mean, considering what the stock price is now—I mean, I don't know. I don't know what you think, but we probably should be invited on CNBC or maybe to talk and be a guest lecturer at the Wharton School of Economics.
Speaker #1: Let's keep going. We don't have to talk about, well, except that we didn't find any stock in Q2 or Q3. We haven't bought any stock so far in Q4.
Well, except that we didn't buy any stock in Q2 or Q3. We haven't bought any stock so far in Q4. Let's go on to Slide 23. Trying to rush here a little bit. Sorry. Our balance sheet, cash, and very incredible cash dividend history.
Speaker #1: Let's go on to slide 23. Trying to rush here a little bit—sorry. Our balance sheet, cash, and very incredible cash dividend history. We have zero long-term debt, and $63.6 million of cash at the end of Q3.
We have zero long-term debt, $63.6 million of cash at the end of Q3, 41 consecutive years of uninterrupted regular quarterly cash dividends, and now paid $608.6 million or $29.72 per share in cash dividends since the beginning of 2005. We're kind of sneaking up on that $30 per share number. PARC founders always kind of like to include this photo with the cash dividend history because this is really the beginning of PARC when we really had almost nothing. We started with basically nothing.
Speaker #1: 41 consecutive years of uninterrupted regular quarterly cash dividends. And now paid $608.6 million, or 29.725 cents per share, in cash dividends since the beginning of 2005.
Speaker #1: We're kind of sneaking up on that $30 per share number. Park founders always kind of like to include this photo with the cash dividend history.
Speaker #1: Because this is really at the beginning of Park, when we really had almost nothing. We started with basically nothing. Let's go on to slide 24.
Let's go on to Slide 24. It's a lot of money, a lot of dividends, I would say, for a company to start with basically nothing. Slide 24. Financial outlook for GE Aerospace Jet Engine programs, the juggernaut. We've used that term for a while now. The timing, we're not sure. The juggernaut is coming, and it is now with a capital NOW.
Speaker #1: It's a lot of money, a lot of dividends, I would say, for a company to start with basically nothing. Slide 24. Financial outlook for GE Aerospace jet engine programs.
Speaker #1: The juggernaut—we've used that term for a while now. The timing, we're not sure. The juggernaut is coming as now, with a capital NOW.
Speaker #1: Can't be stopped. Better be ready. Let's go on to slide 25. I'm rushing a little bit. I just want to stop and say for a second, for some of you new shareholders, if you want a more detailed explanation of some of these things, please just call us.
Can't be stopped. Better be ready. Let's go on to Slide 25. I'm rushing a little bit. I just want to stop and say for a second, for some of you new shareholders, if you want a more detailed explanation of some of these things, please just call us. We happen to go over these items in more detail. We're kind of rushing through them. We just want to get to some of the newer items toward the end of the presentation. Slide 25. So we're talking about engines per year assumptions, and there is a footnote explaining how we came up with those assumptions.
Speaker #1: We happened to go over these items in more detail. We're kind of rushing through them. We just want to get to some of the newer items toward the end of the presentation.
Speaker #1: Slide 25. So we're talking about engines-per-year assumptions, and there is a footnote explaining how we came up with those assumptions. Revenue per engine— that information is provided to us by our customer.
Revenue per engine. Sorry, that information is provided to us by our customer, and the annual revenue per program just multiplying across. We end up with a total of $61.8 million at the outlook year. So a couple of notes here.
Speaker #1: And the annual revenue per program, just multiplying across. And we end up with a total of $61.8 million at the outlook year. So, a couple of notes here.
Speaker #1: Our revenue per engine unit estimates are updated. We've been given updated information from our customer. And here's something we haven't really touched on: why the ingenuous per year assumptions may be conservative?
Our revenue per engine unit estimates are updated. We've been given updated information from our customer. And here's something we haven't really touched on: why the engine units per year assumptions may be conservative. Let's just try to explain this quickly. So A320neo, let's look at that one. We have 1,080 engines we're talking about per year. That's based upon 75 airplanes per month, two engines per airplane, a 60% market share for LEAP. Just do the math. That's 1,080. All right?
Speaker #1: Let's just try to explain this quickly. So, 1820 NEO—let's look at that one. We have 1,080 engines. We're talking about per year. That's based upon 75 airplanes per month, two engines per airplane, a 60% market share for LEAP. Just do the math.
Speaker #1: That's 1,080. All right? So that's based on how many A320 airplanes will be built with LEAP engines. Do you think that every engine is self-structured?
So that's based on how many A320neo airplanes will be built with LEAP engines. Do you think that every engine and cell structure that's produced will end up on those engines? That would be a really ideal situation, but something called scrap, fallout, and things get rejected sometimes. We're not taking that into account at all. We're not taking spares into account either.
Speaker #1: That's produced will end up on those engines? That would be a really ideal situation, but there's something called scrap and fallout, and things get rejected sometimes.
Speaker #1: We're not taking that into account at all. We're not taking spares into account either. So that's why this assumption about ingenious per year might be a little conservative.
So that's why this assumption about engine units per year might be a little conservative. I just want to touch on that. Okay? Slide 26. We don't have to go over this. These are all footnotes related to how we computed the numbers and did the math on Slide 25. Let's keep going. Okay. Now we're changing gears completely. War and peace, Park's new juggernaut. Actually, that term, the new juggernaut, came from one of our investors. We liked it, so we decided to stick with it.
Speaker #1: I just want to touch on that, okay? Slide 26. We don't have to go over this. These are all footnotes related to how we computed the numbers and did the math on slide 25.
Speaker #1: Let's keep going. Okay, now we're changing gears completely. Warren Peace Park's new juggernaut—actually, that term, 'the new juggernaut,' came from one of our investors.
Speaker #1: We liked it, so we decided to stick with it. Some of this is a review from last quarter. Some of it's a little new.
Some of this is a review from last quarter. Some of it's a little new. Unprecedented demand for missile systems. Missile system stockpiles have been seriously depleted by the wars in Europe and the Middle East. There's an urgent need to replenish those depleted missile system stockpiles.
Speaker #1: Unprecedented demand for missile systems. Missile system stockpiles have been seriously depleted by the wars in Europe and the East. There's an urgent need to replenish those depleted missile system stockpiles.
Speaker #1: According to Wall Street Journal reporting, the Pentagon is pushing defense OEMs to double or even quadruple missile system production—on a breakneck schedule. That's a direct quote, obviously.
According to Wall Street Journal reporting, the Pentagon is pushing defense OEMs to double or even quadruple missile system production on a breakneck schedule. That's a direct quote, obviously. The list of Pentagon targeted missile systems include the Patriot missile system, the LRASM, and the SM-6. Patriot probably being a particular priority. Park actively participates in all of those missile systems. Review of and update on the Patriot missile defense system. That's the big one for us. Also, we focus on it because it's public. We're not providing any confidential inside information.
Speaker #1: The list of Pentagon-targeted missile systems includes the Patriot missile system, the LRASM, and the SM-6. Patriot is probably a particular priority. Park actively participates in all of those missile systems.
Speaker #1: Review of and update on the Patriot missile defense system. That's the big one for us. Also, we focus on it because it's public. We're not providing any confidential inside information.
Everything we're providing you is based upon public information. There's just lots and lots of public information about the Patriot missile system. President Trump talks about it sometimes. The large deployment of PAC-3 Patriot missile defense systems, largest, sorry, in history, occurred in response to Iran's ballistic missile strikes on our Ford Air Base in Qatar.
Speaker #1: Everything we're providing you is based upon public information. You're just lots and lots of public information about the Patriot missile system. President Trump talks about it sometimes.
Speaker #1: The largest deployment of PAC-3 Patriot missile defense systems in history occurred in response to Iran's ballistic missile strikes on our Ford Air Base in Qatar.
Speaker #1: That was, I guess, a few months ago, after we bombed Iran—bombed our nuclear sites. On slide 38, so what happened here is we moved the Patriot missile systems to Qatar in anticipation of this attack from South Korea and Japan.
That was, I guess, a few months ago after we bombed Iran, bombed our nuclear sites. On Slide 38, so what happened here is we moved the Patriot missile systems to Qatar in anticipation of this attack from South Korea and Japan. But I don't know if South Korea and Japan are so happy about that. The Department of War wants a very significant increase in Patriot missile stockpiles in Asia. So we just took a lot of them out of Asia. So obviously, we've got a problem on our hands in terms of Patriot missile systems availability.
Speaker #1: But I don't know if South Korea and Japan are so happy about that. The Department of War wants a very significant increase in Patriot missile stockpiles in Asia.
Speaker #1: So we just took a lot of them out of Asia. So obviously, we've got a problem on our hands in terms of Patriot missile systems availability.
Israel's and Ukraine's supplies of Patriot missile systems have been seriously depleted as a result of those wars. Recent news from US defense OEMs, including RTX, Boeing, Lockheed, and L-3, indicating significant ramp-up of Patriot missile system production. It's apparent that US plans to do much more than just replenish the depleted stockpiles.
Speaker #1: Israel's and Ukraine's supplies of Patriot missile systems have been seriously depleted. As a result of those wars, recent news from U.S. defense OEMs, including RTX, Boeing, Lockheed, and L3, indicates a significant ramp-up of Patriot missile system production.
Speaker #1: It's apparent that the US plans to do much more than just replenish or deplete a stockpile. On September 3rd, 2025, Lockheed's Missiles and Fire Control division received its biggest contract in history—a $9.8 billion, with a B, award from the US Army.
On 3 September 2025, Lockheed's Missile and Fire Control Division received its biggest contract in history, a $9.8 billion award from the US Army. That's the branch that uses the Patriot systems for about 2,000, just a little less than 2,000 Patriot missiles. It's a lot. Slide 29. Here's some big stuff. Slide 29. All new. On 6 January 2025, what was that? About a week ago. Yeah, about a week ago. Lockheed announced it reached a seven-year agreement.
Speaker #1: That's the branch that uses the Patriot systems. For about 2,000, just a little less than 2,000, Patriot missiles. It's a lot. Slide 29. Here's some big stuff.
Speaker #1: Slide 29. All new. On January 6, 2006—what was that, about a week ago? Yeah, about a week ago—Lockheed announced it reached the seven-year agreement.
Speaker #1: This is all being driven by the Department of War. With the US Department of War to increase its Patriot PAC-3 Missile Segment Enhancement, MSC interceptor—these are basically Patriot missiles—production to a capacity from 600 to 2,000.
This is all being driven by the Department of War. With the US Department of War to increase its Patriot PAC-3 missile segment enhancement, MSE interceptor, these are basically Patriot missiles, production to a capacity from 600 to 2,000. 600 to 2,000. You can see that number? Over the last two years, this is even more interesting in a way.
Speaker #1: 600 to 2,000. Do you see that number? Over the last two years, this is even more interesting, in a way. Lockheed already increased its production of Patriot PAC-3 interceptors by 60%.
Lockheed already increased its production of Patriot PAC-3 interceptors by 60%. So do the math. If it was increased by 60% to get to 600, that means it was 375 two years ago. So we're going from, I'm just doing the math, 375 to 2,000. You get those numbers? It's kind of unheard of. Unheard of. The new seven-year agreement framework is designed to encourage Lockheed and its suppliers to make the capital investments necessary to boost production capacity to levels needed to support the dramatically increased PAC-3 missile program requirements.
Speaker #1: So, do the math. It was increased by 60% to get to 600. That means it was 375 two years ago. So we're going from, I'm just doing the math, 375 to 2,000.
Speaker #1: You get those numbers? It's kind of unheard of. Unheard of. The new seven-year agreement framework is designed to encourage Lockheed and its suppliers to make the capital investments necessary.
Speaker #1: This is a theme again for the Department of War. They want the Defense Department to be making capital investments rather than paying dividends and buybacks and stuff like that.
This is a theme again for the Department of War. They want the Defense Department to be making capital investments rather than paying dividends, buybacks, and stuff like that. Do we need encouragement? No. We don't need any encouragement. We're already building our factory. We'll get to that in a minute.
Speaker #1: It's necessary to boost production capacity to levels needed to support the dramatically increased PAC-3 missile program requirements. Do we need encouragement? No. We don't need any encouragement.
Speaker #1: We're already building our factory. We'll get to that in a minute. Planning to build a factory to support this program. Lockheed reportedly supplied PAC-3 missile systems to the US and 16 other countries.
Planning to build a factory to support this program. Lockheed reportedly supplied PAC-3 missile supplies, sorry, missile systems to the US and 16 other countries. So a lot of countries that want this system and aren't getting it right now. Breaking news. This is this morning. US Department of War is investing $1 billion in L3Harris solid rocket business. That's Aerojet to boost critical solid rocket production for Patriot and other missile systems. This is a separate, new separate publicly traded company will be created in connection with this investment.
Speaker #1: So, a lot of countries that want this system aren't getting it right now. Breaking news, this is this morning: the US Department of War is investing $1 billion in L3 Harris' solid rocket business.
Speaker #1: That's Airjet. To boost critical solid rocket production for Patriot and other missile systems, a new, separate publicly traded company will be created in connection with this investment.
Speaker #1: This is a big deal, and it's a big deal for Park as well. But you see what's going on here? This is the Department of War driving all this stuff.
This is a big deal, and it's a big deal for Park as well. But you see what's going on here? This is the Department of War driving all this stuff. It's a new world order, as we say later on in the presentation. Let's go to Slide 30. The story continues.
Speaker #1: It's a new world order, as we say later on in the presentation. Let's go to slide 30—the story continues. So, what do we have to do with the Patriot missile system?
So what do we have to do with the Patriot missile system? Park supports the Patriot missile system with specialty ablative materials produced with ArianeGroup. There's an ArianeGroup name again. Their proprietary C2B fabric. This one probably should be in bold, but we're trying to be modest about it. Park is sole source qualified for specialty ablative materials on the PAC-3 missile system program. Just think about that. And think about all we just talked about, what we discussed regarding this program.
Speaker #1: Park supports the PAC-3 Patriot missile system with specially bladed materials produced with Airing Room. There's an Airing Group name again. They're proprietary C2B fabric.
Speaker #1: This one probably should be in bold, but we're trying to be modest about it. Park is sole-source qualified for specially bladed materials on the PAC-3 missile system.
Speaker #1: Program. You just think about that. Then think about all we just talked about. What we discussed regarding this program. Park has recently asked to increase our expected output, especially bladed materials for the program, by a significant worth.
Park has recently asked to increase our expected output, especially ablative materials for the program, by a significantly greater magnitude. So how are we going to do that? We'll fully support this request with the additional manufacturing capacity provided by Park's major facilities expansion discussed below. We didn't need any incentive or encouragement. We're already there. Okay, let's keep going.
Speaker #1: Magnitude. So how are we going to do that? We'll fully support this request with the additional manufacturing capacity, but provided by Park's major facilities expansion discussed below.
Speaker #1: We didn't need any incentive or encouragement. We're already there. Okay, let's keep going. Now, we've got to go back and talk about the Airing Group a little bit more.
Now we're going to go back and talk about the ArianeGroup a little bit more. Not from the perspective of how it affects our quarters from a kind of bigger picture perspective. We have agreements with ArianeGroup, that really wonderful French aerospace company, JV between Airbus and Safran, relating to their proprietary C2B fabric used by PARC to produce ablative composite materials for the Patriot missile system and other missile systems. Then we entered into a business partner agreement. That's what they call it.
Speaker #1: Not from the perspective of how it affects our quarters, from a kind of bigger picture perspective. We have agreements with ArianeGroup, that really wonderful French aerospace company, a JV between Airbus and Safran, relating to their proprietary C2B fabric used by Park to produce bladed composite materials for the Patriot missile system and other missile systems.
Speaker #1: Then we entered into a business partner agreement—that’s what they call it. They refer to us as their partner, very nice—with Arian in January ’22, under which Arian appointed Park as its exclusive North American distributor of their C2B fabric.
They refer to us as their partner. Very nice. With ArianeGroup in January 2022, under which ArianeGroup appointed PARC as its exclusive North American distributor of their C2B fabric. Slide 31. On 27 March 2025, we entered into what they call a new agreement with ArianeGroup, under which PARC agreed to advance EUR 4,587,000 to ArianeGroup against future purchases by PARC of C2B fabric.
Speaker #1: Slide 31. On March 27, '25, we entered into what they call a new agreement with Arian, under which Park agreed to advance $4,587,000 to Arian against future purchases by Park of C2B fabric.
Speaker #1: Now, that was a 50-50 deal. This advance is to be used by Arian to increase its C2B manufacturing capacity in Europe. So they kicked in the same amount.
Now, that was a 50/50 deal. This advance is to be used by ArianeGroup to increase its C2B manufacturing capacity in Europe. So they kicked in the same amount. We went 50/50 on this investment to increase their capacity in Europe. We already paid our first installment of that amount. Sorry. ArianeGroup and Park are partnering on a study to investigate the economic and other considerations relating to potential establishment of a major C2B fabric manufacturing facility in the US. Park committed to contribute. Again, it's a 50/50 deal, EUR 350,000 to the study.
Speaker #1: We went 50-50 on this investment to increase their capacity in Europe, and we already paid our first installment of that amount, sorry. Arian Group and Park are partnering on a study to investigate the economic and other considerations relating to potential establishment of a major C2B fabric manufacturing facility in the U.S.
Speaker #1: Park committed to contribute again. It's a 50-50 deal—$350,000 to the study—and we expect that amount to be expensed in our Q4. Originally, we said Q3; it's probably Q4, but that's another 50-50 deal.
We expect that amount to be expensed in our Q4. Originally, we said Q3; it's probably Q4. But that's another 50/50 deal. This is something we're partnering on this study. At the bottom, Park is engaged in ongoing discussions with ArianeGroup relating to potentially significantly increasing C2B fabric manufacturing capacity in the US.
Speaker #1: This is something we're partnering on in this study. At the bottom, Park is engaged in ongoing discussions with Arian Group relating to potentially significantly increasing C2B fabric manufacturing capacity in the U.S. to support critical Department of War missile programs, including the Patriot missile system program.
to support critical Department of War missile programs, including the Patriot missile system program. It's very important that we highlight this because there's a significant need for much more C2B fabric capacity. So it's very important that this additional capacity be installed to support these programs as they ramp up aggressively. Let's go on to Slide 32. So we've referenced the Patriot missile systems.
Speaker #1: It's very important that we highlight this because there's a significant need for much more C2B fabric capacity. So it's very important that this additional capacity be installed to support these programs.
Speaker #1: As they ramp up aggressively. Let's go on slide 32. So, we've referenced the Patriot missile systems. I'm already explaining this a little bit above because they're very high profile, well-known—numerous others—but there are new, sorry, there are numerous other critical missile programs currently in production or in development, which Park is actively supporting.
I'm already explaining this a little bit above because they're very high profile, well-known, numerous other, there are numerous other critical missile programs currently in production or in development, which PARC is actively supporting. Unfortunately, many of these programs are too confidential or sensitive for us to identify at this time. But please understand that certain of these programs represent very significant revenue opportunities for PARC over long periods of time. So last thing on war and peace.
Speaker #1: Unfortunately, many of these programs are too confidential or sensitive for us to identify at this time. But please understand that certain of these programs represent very significant revenue opportunities for Park over a long period of time.
Speaker #1: So, the last thing on war and peace—how about the U.S. defense industry's new world order? We already talked about this a little bit.
How about the US defense industry's new world order? We already talked about this a little bit. President Trump wants to increase the US defense budget to $1.5 trillion with a T in order to build our dream military. So this is a two-edged sword for the defense industry. It's being, what is it? Somebody give us and take us away. Here's the take us away. But according to President Trump, the defense industry needs to get its act together.
Speaker #1: President Trump wants to increase the US defense budget to $1.5 trillion—with a T—in order to build our dream military. So this is a two-edged sword for the defense industry.
Speaker #1: It's being, what is it? Somebody gives us and takes us away. Here's the take us away. But according to President Trump, the defense industry needs to get its act together.
Speaker #1: So, buybacks, dividends—no. Why don't you invest in defense programs? CEO pay limits. So, there's been a real issue with the aerospace industry generally.
So buybacks, dividends. No, why don't you invest in defense programs? CEO, even CEO pay limits. So there's been a real issue with the aerospace industry generally. Programs getting being not on time and not on budget. And I think that the Department of War doesn't really like that very much. They're asking the defense industry to kind of get its act together.
Speaker #1: Programs are not being on time and not on budget. And I think that the Department of War doesn't really like that very much. They're asking the defense industry to kind of get its act together.
Speaker #1: Well, what do we think about the new world order? We think it's great. Park thinks it's great. We think it's wonderful. Slide 33. Okay, let's talk about our new plan.
What do we think about the new world order? We think it's great. PARC thinks it's great. We think it's wonderful. Slide 33. Okay, let's talk about our new plant. Sorry, it's going on so long. I'm rushing, as you probably can hear through this as quickly as I can. PARC's new major new composite materials manufacturing plant. So now we're going to give you a little bit more information about this new plant. We're planning to build a major new composite material manufacturing plant.
Speaker #1: Sorry, it's going on so long. I'm rushing, as you probably can hear, through this as quickly as I can. Park's new major, new composite materials manufacturing plan.
Speaker #1: So now we're going to give you a little bit more information about this new plan. We're planning to build a major new composite material manufacturing plant.
Speaker #1: A new plan is being designed to be fully functioning and integrated—a fully functioning, sorry, and integrated composite material manufacturing plant. And we'll include the following manufacturing lines: solution treating, hot melt film, hot melt tape, confidential manufacturing lines, and support equipment.
New plant is being designed to be fully functioning and integrated, a fully functioning, sorry, and integrated composite material manufacturing plant. It will include the following manufacturing line: solution printing, hot melt film, hot melt tape, confidential manufacturing lines, and support equipment.
Speaker #1: The new plan will also include full production lab facilities, office space, storage, and freezer, and ancillary equipment necessary to support all plant manufacturing activities and operations.
The new plant will also include full production, lab facilities, office space, storage, freezer, and ancillary equipment necessary to support all plant manufacturing activities and operations. So it's like a fully integrated plant with everything that's needed. The new plant is being designed to produce PARC's produce and support PARC's complete composite materials product line, including film adhesives and lightning strike materials. Slide 34, but the plant is not being designed currently anyway to produce our composite parts, structures, and assemblies.
Speaker #1: So let's take a fully integrated plant with everything that's needed. The new plant is being designed to produce Park's—to produce and support Park's complete composite materials product line, including film adhesives and lightning strike materials. Slide 34.
Speaker #1: But the plant is not being designed currently anyway to produce our composite parts, structures, and assemblies, okay? Plant size—it's getting pretty big, 120,000 square feet.
Okay? Plant size, it's getting pretty big, 120,000sq ft. This could change, but that's our current guesstimate on the plant size. When the plant is complete and operational, and get this, new plant will approximately double PARC's current composite materials manufacturing capacity. So that's you can see why the plant is that big. When will the new plant be completed?
Speaker #1: This could change, but that's our current guesstimate on the plant size. When the plant is complete and operational—and get this—the new plant will approximately double Park's current composite materials manufacturing capacity.
Speaker #1: So, that's—you can see why the plant is that big. When will the new plant be completed? Well, we have some internal discussion about that.
Well, we have some internal discussion about that, maybe debate. But let's just say for now, the second half of calendar 2027. And when we'll be operational, what do we mean by operational? Not fully ramped up. That means we're producing and selling some product. Some product has been qualified for production and sale. Maybe second half of, let's say, calendar 2028 would be a target for when the plant will be operational. Estimated capital budget for new plant, approximately $50 million.
Speaker #1: Maybe debate. But let's just say for now, the second half of calendar '27. And when will it be operational? What do you mean by operational?
Speaker #1: Not fully ramped up. That means we're producing and selling some product. Some product has been qualified for production and sale. Maybe second half of, let's say, calendar year '28 would be a target for when the plant will be operational.
Speaker #1: Estimated capital budget for the new plant is approximately $50 million. What's the timing of the capital spend on the plant? Again, this is planning in flux.
What's the timing of the capital spend on the plant? Again, this is plenty in flux. At this point, fiscal year 2027, that's the coming fiscal year, probably 60% of that money. Fiscal year 2028, maybe 30% of the money. Fiscal year 2029, maybe 10% of the money. That's how the money will be going out the door.
Speaker #1: At this point, fiscal year '27—that's the coming fiscal year—probably 60% of that money; fiscal year '28, maybe 30% of the money; fiscal year '29, maybe 10% of the money.
Speaker #1: That's how the money will be going out the door. How will we fund the capital spend for the new plant? Well, with our cash, with our cash flow, and to some extent from the offering that we just announced, if that offering is successful.
How will we fund the capital spend for the new plant? Well, with our cash, with our cash flow, and to some extent from the offering that we just announced, if that offering is successful. But is a new plant project dependent on the public offering discussed below? Absolutely not. We're doing this. There's no question about it. Nothing has to be decided. It's going to be done. We're just finishing the planning. It's not dependent on anything. It's something we're committed to doing for very good reasons for Park and for our investors.
Speaker #1: But is the new plant project dependent on the public offering discussed below? Absolutely not. We're doing this. There's no question about it. Nothing has to be decided.
Speaker #1: It's going to be done. We're just finishing the planning. It's not dependent on anything. It's something we're committed to doing for a very good reason for Park and for our investors.
Okay, let's go on to slide 35. Still on the new plant. Where will the new plant be located? We have a finalist location in Midwest, but we're still waiting for approvals from local community, economic development. These things for us go much more slowly than we like. Why are we building this new plant?
Speaker #1: Okay, let's go on to slide 35. Still on the new plant—where will the new plant be located? We have a finalist location in the Midwest, but we're still waiting for approvals from local community economic development.
Speaker #1: These things for us go much more slowly than we like. Why are we building this new plant? Well, that's obviously the $64,000 question. Or maybe the $50 million question.
Well, that's obviously the $64,000 question, or maybe the $50 million question. Our juggernauts, plural, both of our juggernauts we've talked about require it. Our long-term business and sales outlooks require it. Significant additional composite materials manufacturing capacity is required to support our juggernauts and the long-term business and sales outlooks. We're doing this to ensure we continue to have the manufacturing capacity needed for PARC to be PARC.
Speaker #1: Our juggernaut's plural, both our juggernauts we've talked about, require it. Our long-term business and sales outlooks require it. Significant additional composite materials manufacturing capacity is required to support our juggernauts.
Speaker #1: And a long-term business and sales outlooks. And we're doing this to ensure we continue to have the manufacturing capacity needed for Park to be Parked.
Speaker #1: So we're doing this to ensure Park is able to continue to be the company of yes, the can-do company. Yes, we can company.
We're doing this to ensure PARC is able to continue to be the company of yes, the can-do company, the yes-we-can company. We're not looking to become a mill. We're not going to abandon how we got here. Why we have the great, in my opinion, success we have. Why we have more opportunities than we could ever handle.
Speaker #1: So we're not looking to become a mill. We're not going to abandon how we got here, why we have the greats—in my opinion—the success we have.
Speaker #1: We have more opportunities than we could ever handle. So it would be really foolish for us to abandon how we got here and become a mill company where we just run our factory like a mill, and then somebody wants— a customer wants something.
So it would be really foolish for us to abandon how we got here and become a mill company where we just run our factory like a mill, and then somebody, a customer, wants something. Okay, we can help you out maybe a year from next month. I'm not exaggerating. That's really what happened with this industry. That's not for us. Let's go on to slide 36. What are our calling cards? Flexibility, responsiveness, and urgency.
Speaker #1: Okay, we can help you out maybe a year from next month. I'm not exaggerating. That's really what happened with this industry. That's not for us.
Speaker #1: Let's go on to slide 36. What are our crawling cars? Flexibility, responsiveness, and urgency. So, we're doing this to ensure Park is able to continue to do those things, which got us here.
So we're doing this to ensure Park is able to continue to do those things which got us here. It would be a very unfortunate mistake for us to abandon the things which got us here. A very bad mistake. So our new plant needs to be designed with being Park in mind, meaning being flexible, being responsive, having urgency, saying yes we can. You need something, we're going to move everything around.
Speaker #1: It would be a very unfortunate mistake for us to abandon the things which got us here—a very bad mistake. So our new plant, it needs to be designed with being 'Parked' in mind; meaning being flexible, being responsive, having urgency.
Speaker #1: Saying, yes, we can. You need something. We're going to move everything around. We were just talking yesterday, maybe Friday, about whatever large customers— they want to move so many things around.
We just talked yesterday, maybe Friday, about whatever large customers they want to move so many things around. If it was any other supplier, we'd say, well, sorry. We don't ever say sorry. Sure, we'll move everything around. A lot. It requires us to juggle a lot. It requires production to juggle a lot. But that's what we do for a living. Okay? And that's why we have the success that we have, in my opinion.
Speaker #1: If it was any other supplier, we'd say, well, sorry. We don't ever say sorry. Sure, we'll move everything around—a lot. It requires us to juggle a lot.
Speaker #1: It requires production to juggle a lot. But that's what we do for a living, okay? And that's why we, in my opinion, have the success that we have. When our new manufacturing plant is complete and fully operational, what will Park's total composite materials manufacturing capacity be?
When our new manufacturing plant is complete and fully operational, what will Park's total composite materials manufacturing capacity be? Well, it's a question that isn't so easy to answer. It depends on how do you define manufacturing capacity. Park being Park manufacturing capacity, that means run the business the way we want to run it so we have that maximum flexibility, responsiveness, and urgency.
Speaker #1: Well, it's a question that isn't so easy to answer. It depends on how you define manufacturing capacity. Park being Park manufacturing capacity, that means run the business the way we want to run it.
Speaker #1: So we have that maximum flexibility, responsiveness, and urgency. If we run a factory like a mill—not just plan it—six days a week, 24 hours a day, we could do that.
If we run a factory like a mill, I just plant it six days a week, 24 hours a day, we could do that, but then our flexibility is almost nil. But PARC being PARC manufacturing capacity, maybe about $220 million. PARC being PARC manufacturing capacity, but pushing it to some extent, still being PARC, but pushing it to some extent, about $260 million. These are preliminary estimate numbers we've been asked by a number of investors. Please give us some help here. Please give us some perspective on the manufacturing capacity.
Speaker #1: But then our flexibility is almost nil. But Park being Park, manufacturing capacity, maybe about $220 million. Park being Park, manufacturing capacity, but pushing it to some extent—still being Park, but pushing it to some extent—about $260 million.
Speaker #1: These are preliminary estimate numbers. We haven't asked by number of investors. Please give us some help here. Please give us some perspective. On the manufacturing capacity, the maximum sustainable manufacturing capacity—this is what we don't want—would be about $315 or $320 million.
The maximum sustainable manufacturing capacity, this is what we don't want, would be about $315 or $20 million. That's not what we want. Okay? So when you ask, and we haven't asked what the manufacturing capacity is, we have to say, well, it depends on what you mean by that. Let's go on to slide 37.
Speaker #1: That's not what we want, okay? So when you ask and we haven't asked what the manufacturing capacity is, we have to say, well, it depends on what you mean by that.
Speaker #1: Let's go on to slide 37. And I just want to say these are numbers we're working on. We're doing a massive amount of work, and Mark and the guys are working on the expansion plan.
I just want to say these are numbers we're working on. We're doing a massive amount of work, Mark and the guys on the expansion plan. So a lot of work has been done, but we're not quite finished with everything. And even after we're finished, things can move. Mix can change and things like that, which will affect capacity and sales. Slide 37. Park's long-term sales outlook for composite materials, including film adhesive materials and lightning strike protection materials. So we got to say again, what does this mean? Our number is approximately $200 million. $200 million.
Speaker #1: So a lot of work has been done, but we're not quite finished with everything. And even after we're finished, things can move. Mix can change, and things like that, which will affect capacity and sales.
Speaker #1: Slide 37. Park's long-term sales outlook for composite materials, including film adhesive materials and lightning strike protection materials. So, we got to say again, what does this mean?
Speaker #1: It's our numbers, approximately $200 million, $200 million. Okay? But how is this outlook computed? It's really important to understand what this means, because it's not a forecast.
Okay? But how is this outlook computed? It's really important to understand what this means because it's not a forecast. It's an outlook. And this is how this outlook was computed with line items that are known items. These are known sales, unknown programs, unknown customers. There's no other category.
Speaker #1: It's an outlook. And this is how this outlook was computed, with line items that are known items. These are known sales on known programs and known customers.
Speaker #1: There’s no other category. There’s all line items of known opportunities, known customers, known programs. That’s how it’s computed. That’s what that outlook includes. What does it not include?
There's all line items of known opportunities, known customers, known programs. That's how it's computed. That's what that outlook includes. What does it not include? So do you think that in the next three or four years, will there be no other opportunities like six months from now or a year from now or tomorrow? We'll get a call from an OEM about a program they want us to work on. My guess is it'll probably be tomorrow because we're getting so many opportunities.
Speaker #1: So, do you think that in the next three or four years, there will be no other opportunities? Like, six months from now, or a year from now, or tomorrow?
Speaker #1: We'll get a call from an OEM about a program they want us to work on. My guess is it'll probably be tomorrow because we're getting so many opportunities.
Speaker #1: They're not including any of that, because we don't know what comes. So it's important you understand it's not a forecast; it's just an outlook of the methodology that we use.
They're not including any of that, which we don't know what comes. So it's important you understand it's not a forecast. It's just an outlook of what the methodology that we use. What are the high and low risks of the outlook? So I think we feel pretty confident about the line items in the forecast.
Speaker #1: What are the high and low risks of the outlook? So I think we feel pretty confident about the line items in the forecast. But it's possible that either we aren't on those programs, or we won't get in those programs.
But it's possible that that will either we're on those programs or we'll get in those programs. Those programs will be ours. But it's possible those programs won't pan out to the level that we're being told by our customers. Maybe they won't be as strong. Maybe it'll take them longer to ramp up. I don't know. It's possible. So there's risk on the low side. What about the high side? The high side is all those things we just talked about, things we don't know yet that are definitely going to come.
Speaker #1: Those programs will be ours. But it's possible those programs won't pan out to the level that we're being told by our customers. Maybe there won't be a strong—maybe it'll take longer to ramp up.
Speaker #1: I don't know. It's possible. So, there's risk on the low side. What about the high side? The high side is all those things we just talked about, things we don't know yet.
Speaker #1: That are definitely going to come. They're not—there's no way. We haven't used—we haven't provided 'other' category in our forecast or outlook; rather, the way we computed it.
There's no way we haven't used. We haven't provided another category in our forecast or outlook, rather, the way we computed it. Just things we know about. What's the target year for the outlook? Well, that's another controversial question internally.
Speaker #1: Just things we know about. What's the target year for the outlook? Well, that's another controversial question internally. I think we're saying fiscal year '31.
I think we're saying fiscal year 2031, and I'll tell you, I would say the end of fiscal year 2031. Fiscal year 2031 sounds like a long time from now, but it starts four years from now. That means for us to be able to be at that level, everything has to be ramped up. The plant would have to be fully built, and the new plant qualified. All the programs have to be qualified.
Speaker #1: And I'll tell you, I would say the end of fiscal year '31. Because fiscal year '31 sounds like a long time from now, but it starts four years from now.
Speaker #1: So, that means for us to be able to be at that level, everything has to be ramped up. The plant would have to be fully built.
Speaker #1: And the new plant, and qualified, all the programs have to be qualified. And we’d have hired all the people, all the staffing, and we’re fully ramped up.
And we'd have hired all the people, all the staffing, and we're fully ramped up. So to me, to do that in four years, that's a little aggressive. That's why I think what we should think about to be a little more conservative is the end of fiscal 2031, which is more like five years from now.
Speaker #1: So, to me, to do that in four years—that's a little aggressive. That's why I think what we should think about, to be a little more conservative, is the end of fiscal '31, which is more like five years from now.
Speaker #1: It doesn't mean we want to be sales, but to be ramped up to that level, probably I would think to be more conservative. We might want to think five years from now, rather than four years from now.
Doesn't mean we want to be sales, but to be ramped up that level, probably I would think, to be more conservative. We might want to think five years from now rather than four years from now. Thoughts about our ROI for PARC's investment in the new plant, $50 million. We're not going to go through what the bottom line impact is now, but you think about it. We have this year, what is $72 million of sales. We're talking about $200 million of sales, $50 million investment.
Speaker #1: Thoughts about our ROI for Park's investment in the new plant? $50 million. We're not going to go through what the bottom line impact is now, but you think about it.
Speaker #1: We have, this year, what is $72 million of sales. We're talking about $200 million of sales. $50 million investment. You could probably do the math a little bit on your own.
You could probably do the math a little bit on your own. We had some real smart investors. We're not going to go to that number now, but we think that the ROI would be extremely attractive, that we wouldn't doubt any investor would ever have a problem with it. Let's go on to slide 38. PARC's newly announced public offering.
Speaker #1: We had some real smart investors. We're not going to go through that number now, but we think that the ROI would be extremely attractive—that we wouldn't, if we doubt any investor would ever have a problem with it.
Speaker #1: Let's go on to slide 38. Park's newly announced public offering. Just touch on this quickly. Today, sorry, it's going on so long. Today, we filed a form S3 registration statement of prospective supplement with the SEC for a 50 million dollar at the market public offering of Park's common stock.
Just touch on this quickly. Today, sorry, it's going on so long. Today, we filed a Form S-3 registration statement and prospectus supplement with the SEC for a $50 million at-the-market public offering of PARC's common stock. What's the purpose of this offering and financing? Well, first of all, to replenish a portion of the $50 million that we plan to invest in our new composite plant, composite materials plant. That's part of it.
Speaker #1: What's the purpose of this offering and financing? Well, first of all, to replenish a portion of the $50 million that we plan to invest in our new composite materials plant.
Speaker #1: That's part of it. But very importantly, to ensure that Park has the necessary funds to be in a position to take advantage of and exploit key opportunities currently being presented to Park.
But very importantly, to ensure that PARC has the necessary funds to be in a position to take advantage of and exploit key opportunities currently being presented to PARC and new key opportunities as they arise in the future. The availability of funds necessary to exploit key opportunities has been a key strategic advantage to PARC. So you're probably thinking, well, can you give me an example? Yeah, I can give you an example.
Speaker #1: And new key opportunities as they arise in the future. The availability of funds necessary to exploit key opportunities has been a key strategic advantage to Park.
Speaker #1: So you're probably thinking, well, can you give me an example? Yeah, I can give you an example. We talked about GE Aerospace. How many hundreds of millions of dollars of business was represented?
We talked about GE Aerospace. How many hundreds of millions of dollars of business was represented? Well, remember what happened? GE said to us, it was GE at the time, not see, yeah, we'll give you the LTA through 2029. But PARC, we're concerned because you're sole source qualified in these programs. We want you to build a redundant factory. And then if you commit to doing that, we'll give it the LTA. And we said, sure, we'll do that.
Speaker #1: Well, remember what happened? GE said to us—it was GE at the time, not SEC—'Yeah, we'll give you the LTA through 2029, but Park, we're concerned because you're sole source qualified on these programs.'
Speaker #1: We want you to build a redundant factory. And then if you commit to doing that, we'll give you the LTA. And we said, sure.
Speaker #1: We'll do that. We didn't say sure, but we got to go see if we can get the money or go to banks, and that would have been terrible.
We didn't say sure, but we got to go see if we can get the money or go to banks. And it would have been terrible because GE, if they're smart, would think, well, I don't know if PARC's going to get the money. Let's go talk to somebody else. That never happened because we said right there on the spot, yep, we'll do it.
Speaker #1: Because GE, if they're smart, would think, well, I don't know if Park's going to get the money. Let's go talk to somebody else. That never happened.
Speaker #1: Because we said, right there on the spot, yep, we'll do it. And we had the money to do it. It was about $20 million at the time.
We had the money to do it. It was about $20 million at the time. I think we believe if we had to do that plan now, it'd probably be twice as much based on inflation. We are quite sure it is in Park's and our investors' very best interest for Park to be able to continue to exploit such opportunities as they arise in the future. Just a little interesting information. I don't know, footnote. You know where our last public offering was?It was, well, Martina found a tombstone in our office.
Speaker #1: I think we believe if we had to do that plan now, it'd probably be twice as much based on all the inflation. We were quite sure it isn't Park's and our investors' very best interests for Park to be able to continue to exploit such opportunities as they arise in the future.
Speaker #1: Just a little interesting information, a footnote. You know where our last public offering was? It was—well, Martina found a tombstone in our office.
It was 6 March 1996, 30 years ago. It was a $100 million convertible note offering that was converted to all equity, almost all equity. I think 96 of it was converted to equity. Underwriters were Needham, Robertson Stephens, and Lehman. We happened to last two. Anyway, just a little interesting history.
Speaker #1: It was March 6, 1996—30 years ago. It was a $100 million convertible note offering that was converted to all the equity. Almost all the equity.
Speaker #1: It was converted to equity. I think 96% of underwriters were Needham, Robin Stevens, and Lehman. We didn't have them until the last two. Anyway, just a little interesting history.
Speaker #1: Sorry to go on for so long, everybody, but operator, do we happen to take any questions at this time, to the extent there are any?
Sorry to go on for so long, everybody, but operator, we're happy to take any questions at this time, to the extent there are any. Operator?
Speaker #1: Operator? Thank
Speaker #2: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad.
Operator: Thank you. Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. And again, if you have any questions, you may press star then the number one on your telephone keypad to join the queue and ask a question.
Speaker #2: A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove yourself from the queue. For participants, you can speak through your equipment, and it may be necessary to pick up your handset before pressing the star keys.
Speaker #2: And again, if you have any questions, you may press star, then the number 1 on your telephone keypad to join the queue and ask a question.
And it looks like we have no questions at this time. Therefore, I'll turn the floor back over to Mr. Brian Shore for closing remarks.
Speaker #2: And it looks like we have no questions at this time. Therefore, I'll turn it back over to Mr. Brian Shore for a
Speaker #2: closing remarks. Thank you,
Brian Shore: Thank you, Operator. Thank you, everybody, for listening. We apologize that the presentation went on so long. There's a lot to cover. Please feel free to give us a call if you have any follow-up questions. Some of the items I think we kind of skimmed over a little bit quickly. So feel free to give us a call. We're happy to help you out with any follow-up questions. Have a good day. And once again, happy New Year. All the best to you and your family in 2026. Goodbye.
Speaker #1: Operator: Thank you, everybody, for listening. We apologize that the presentation went on so long—we had a lot to cover. Please feel free to give us a call if you have any follow-up questions.
Speaker #1: Some of the items I think we kind of skimmed over a little bit quickly. So, feel free to give us a call—we're happy to help you out with any follow-up questions.
Speaker #1: Have a good day, and once again, Happy New Year and all the best to you and your family in 2026. Goodbye.
Operator: Thank you. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.
