What changed in this filing

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Item 1. Financial Statements

2026-07-20 compared with 2026-01-13 · 62 added, 127 removed, 241 unchanged (44% of the section changed)

41 unchanged sentences

13 Weeks Ended (Unaudited)

39 Weeks Ended (Unaudited)

Cost of sales

1 unchanged sentence

Earnings from operations

Storm damage charge (Note 11)

Interest and other income

12 unchanged sentences

13 Weeks Ended (Unaudited)

39 Weeks Ended (Unaudited)

Other comprehensive earnings, net of tax:

3 unchanged sentences

Unrealized holding losses arising during the period

reclassification adjustment for losses included in net earnings

Other comprehensive earnings

7 unchanged sentences

Treasury Stock

(Loss) Earnings

Balance, March 1, 2026

Unrealized gain on marketable securities, net of tax

Stock options exercised

Stock-based compensation

Repurchase of treasury shares

Cash dividends ($ 0.125 per share)

Balance, June 1, 2025

Unrealized gain on marketable securities, net of tax

Stock options exercised

Stock-based compensation

Cash dividends ($ 0.125 per share)

Balance, August 31, 2025

Unrealized gain on marketable securities, net of tax

Stock options exercised

Stock-based compensation

Cash dividends ($ 0.125 per share)

Balance, November 30, 2025

See Notes to Condensed Consolidated Financial Statements (Unaudited).

PARK AEROSPACE CORP.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS ’ EQUITY (continued)

(Amounts in thousands, except share and per share amounts)

Balance, May 31, 2026

Comprehensive

Treasury Stock

(Loss) Earnings

Balance, March 2, 2025

Unrealized gain on marketable securities, net of tax

Stock-based compensation

Cash dividends ($ 0.125 per share)

Balance, June 2, 2024

Unrealized gain on marketable securities, net of tax

Stock options exercised

2 unchanged sentences

Cash dividends ($ 0.125 per share)

Balance, September 1, 2024

Unrealized gain on marketable securities, net of tax

Stock-based compensation

Repurchase of treasury shares

Cash dividends ($ 0.125 per share)

Balance, December 1, 2024

Balance, June 1, 2025

See Notes to Condensed Consolidated Financial Statements (Unaudited).

6 unchanged sentences

Adjustments to reconcile net earnings to net cash provided by operating activities:

Non-cash storm damage charge

Depreciation and amortization

Stock-based compensation

Provision for credit losses

Allowance for credit losses

Deferred income taxes

Amortization of bond premium

Loss on sale of marketable securities

Changes in operating assets and liabilities

10 unchanged sentences

Net cash used in financing activities

Increase in cash and cash equivalents:

Increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Supplemental disclosure of non-cash activities:

Addition to operating right-of-use asset from new operating lease liability

Supplemental cash flow information:

5 unchanged sentences

(Amounts in thousands, except share (unless otherwise stated), per share and option amounts)

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Condensed Consolidated Balance Sheet and the Condensed Consolidated Statement of Shareholders’ Equity as of November 30, 2025, the Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Comprehensive Earnings for the 13 weeks and 39 weeks ended November 30, 2025 and December 1, 2024, and the Condensed Consolidated Statements of Cash Flows for the 39 weeks ended November 30, 2025 and December 1, 2024 have been prepared by Park Aerospace Corp.

CONSOLIDATED FINANCIAL STATEMENTS

The Condensed Consolidated Balance Sheet and the Condensed Consolidated Statement of Shareholders’ Equity as of May 31, 2026, the Condensed Consolidated Statements of Operations and the Condensed Consolidated Statements of Comprehensive Earnings for the 13 weeks ended May 31, 2026 and June 1, 2025, and the Condensed Consolidated Statements of Cash Flows for the 13-week periods then ended have been prepared by Park Aerospace Corp.

(the “Company”), without audit.

In the opinion of management, these unaudited Condensed Consolidated Financial Statements contain all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at November 30, 2025 and the results of operations and cash flows for all periods presented.

In the opinion of management, these unaudited condensed consolidated financial statements contain all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at May 31, 2026 and the results of operations and cash flows for all periods presented.

The Condensed Consolidated Statements of Operations are not necessarily indicative of the results to be expected for the full fiscal year or any subsequent interim period.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted.

It is suggested that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 1, 2026.

There have been no significant changes to such accounting policies during the 39 weeks ended November 30, 2025.

There have been no significant changes to such accounting policies during the 13 weeks ended May 31, 2026.

FAIR VALUE MEASUREMENTS

8 unchanged sentences

Unobservable inputs are used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date.

The fair value of the Company’s cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to their short-term nature.

The fair value of the Company’s cash and cash equivalents, accounts receivable, and accounts payable approximate their carrying value due to their short-term nature.

Certain assets and liabilities of the Company are required to be recorded at fair value on either a recurring or non-recurring basis.

On a recurring basis, the Company records its marketable securities at fair value using Level 1 or Level 2 inputs.

(See Note 3).

The Company’s non-financial assets measured at fair value on a non-recurring basis include goodwill and any long-lived assets written down to fair value.

4 unchanged sentences

If, based on that assessment, the Company believes it is more likely than not that fair value is less than carrying value, a goodwill impairment test is performed.

There have been no changes in events or circumstances which required impairment charges to be recorded during the 13 weeks and 39 weeks ended November 30, 2025.

MARKETABLE SECURITIES

3 unchanged sentences

The following is a summary of available-for-sale securities:

November 30, 2025

Treasury and other government securities

5 unchanged sentences

Amortized Cost

November 30, 2025:

May 31, 2026:

Treasury and other government securities

3 unchanged sentences

Total marketable securities

The estimated fair values of such securities at November 30, 2025 by contractual maturity are shown below:

The estimated fair values of such securities at May 31, 2026 by contractual maturity are shown below:

Due in one year or less

Due after one year through five years

Inventories are stated at the lower of cost (first-in, first-out method) or net realizable value.

8 unchanged sentences

All of the Company’s leases have been assessed to be operating leases.

Renewal options are included in the lease term to the extent the Company is reasonably certain to exercise the option.

Renewal options are included in the lease terms to the extent the Company is reasonably certain to exercise the options.

The exercise of lease renewal options is at the Company’s sole discretion.

3 unchanged sentences

The Company’s existing leases are not subject to any restrictions or covenants which preclude its ability to pay dividends, obtain financing or exercise its available renewal options.

Future minimum lease payments under non-cancellable operating leases as of November 30, 2025 are as follows:

Future minimum lease payments under non-cancellable operating leases as of May 31, 2026 are as follows:

Total undiscounted operating lease payments

2 unchanged sentences

The above payment schedule includes renewal options that the Company is reasonably likely to exercise.

Leases with an initial term of 12 months or less are not recorded on the Company’s Condensed Consolidated Balance Sheets.

Leases with an initial term of 12 months or less are not recorded on the Company’s condensed consolidated balance sheet.

The Company recognizes lease expense for these leases on a straight-line basis over the terms of the leases.

For the 13 weeks and 39 weeks ended November 30, 2025, the Company’s operating lease expenses were $ 17 and $ 51 , respectively.

Cash payments of $ 43 , pertaining to operating leases, are reflected in the cash flow statement under cash flows from operating activities.

The following table sets forth the right-of-use assets and operating lease liabilities as of November 30, 2025:

For the 13 weeks ended May 31, 2026 and June 1, 2025, the Company’s operating lease expenses were $ 17 and $ 17 , respectively.

Cash payments for the 13 weeks ended May 31, 2026 and June 1, 2025 of $ 15 and $ 14 , respectively, pertaining to operating leases, are reflected in the cash flow statement under cash flows from operating activities.

The following table sets forth the right-of-use assets and operating lease liabilities as of May 31, 2026 and March 1, 2026:

Operating right-of-use assets

2 unchanged sentences

Total operating lease liabilities

The Company’s weighted average remaining lease term for its operating leases is 5.8 years.

At May 31, 2026 and March 1, 2026, the Company’s weighted average remaining lease terms for its operating leases were 5.42 years and 5.59 years, respectively, and the weighted average borrowing rates for its operating leases were 4.98 % and 4.98 %, respectively.

STOCK-BASED COMPENSATION

As of November 30, 2025, the Company had a 2018 Stock Option Plan (the “2018 Plan”) and no other stock-based compensation plan.

As of May 31, 2026, the Company had a 2018 Stock Option Plan (the “2018 Plan”) and no other stock-based compensation plan.

The 2018 Plan was adopted by the Board of Directors of the Company on May 8, 2018, approved by the shareholders of the Company at the Annual Meeting of Shareholders of the Company on July 24, 2018, and amended by the shareholders of the Company on July 18, 2024 and provides for the grant of options to purchase up to 1,550,000 shares of common stock of the Company.

4 unchanged sentences

Any shares of common stock subject to an option under the 2018 Plan, which expires or is terminated unexercised as to such shares, shall again become available for issuance under the 2018 Plan.

During the 39 weeks ended November 30, 2025, the Company granted options to its directors and certain of its employees under the 2018 Plan to purchase a total of 148,700 shares of common stock.

The future compensation expense to be recognized in earnings before income taxes is $ 476 and will be recorded on a straight-line basis over the requisite service period.

The weighted average fair value of the granted options was $ 3.32 per share using the Black-Scholes option pricing model with the following assumptions:

risk-free interest rate of 4.10 %- 4.35 %;

expected volatility factor of 24.0 %- 27.3 %;

expected dividend yield of 3.57 %;

and estimated option term of 5.9 - 9.2 years.

The risk-free interest rates were based on U.S.

Treasury rates at the date of grant with maturity dates approximately equal to the estimated terms of the options at the date of the grant.

Volatility factors were based on historical volatility of the Company’s common stock.

The expected dividend yields were based on the regular quarterly cash dividend per share most recently declared by the Company and on the exercise price of the options granted during the 13 weeks and 39 weeks ended November 30, 2025.

The estimated term of the options was based on evaluations of the historical and expected future employee exercise behavior.

The future compensation expense to be recognized in earnings before income taxes for options outstanding at November 30, 2025 was $ 864 , which is expected to be recognized ratably over a weighted average vesting period of 1.38 years.

The following is a summary of option activity for the 39 weeks ended November 30, 2025:

The future compensation expense to be recognized in earnings before income taxes for options outstanding at May 31, 2026 was $ 666 , which is expected to be recognized ratably over a weighted average vesting period of 1.22 years.

The following is a summary of option activity for the 13 weeks ended May 31, 2026:

Exercise Price

4 unchanged sentences

Terminated or expired

Balance, November 30, 2025

Vested and exercisable, November 30, 2025

Balance, May 31, 2026

Vested and exercisable, May 31, 2026

EARNINGS PER SHARE

1 unchanged sentence

Diluted earnings per share are computed by dividing net earnings by the sum of (a) the weighted average number of shares of common stock outstanding during the period and (b) the potentially dilutive securities outstanding during the period.

Stock options are the only potentially dilutive securities;

Stock options are the Company’s only potentially dilutive securities;

and the number of dilutive options is computed using the treasury stock method.

1 unchanged sentence

13 Weeks Ended

39 Weeks Ended

Weighted average common shares outstanding for basic EPS

3 unchanged sentences

Diluted earnings per share

Potentially dilutive securities, which were not included in the computation of diluted earnings per share, because either the effect would have been anti-dilutive or the options’ exercise prices were greater than the average market price of the common stock, were 0 and 75,000 for the 13 weeks ended November 30, 2025 and December 1, 2024, respectively, and 161,000 and 53,000 for the 39 weeks ended November 30, 2025 and December 1, 2024, respectively.

Potentially dilutive securities, which were not included in the computation of diluted earnings per share, because either the effect would have been anti-dilutive or the options’ exercise prices were greater than the average market price of the common stock, were 0 and 335,338 for the 13 weeks ended May 31, 2026 and June 1, 2025, respectively.

SHAREHOLDERS ’ EQUITY

On May 23, 2022, the Company announced that its Board of Directors authorized the Company’s purchase, on the open market and in privately negotiated transactions, of up to 1,500,000 additional shares of its common stock.

This authorization supersedes any unused prior Board of Directors’ authorizations to purchase shares of the Company’s common stock.

The Company purchased 166,955 and 180,547 shares of its common stock during the 39 weeks ended November 30, 2025 and September 1, 2024, respectively.

As a result, the Company is authorized to purchase up to a total of 781,766 shares of its common stock, representing approximately 3.9 % of the Company’s 19,925,798 total outstanding shares as of the close of business on January 7, 2026.

This authorization superseded any unused prior Board of Directors’ authorizations to purchase shares of the Company’s Common Stock.

The Company purchased 0 and 166,955 shares of its common stock during the 13 weeks ended May 31, 2026 and June 1, 2025, respectively.

As a result, the Company is authorized to purchase up to a total of 781,766 shares of its common stock, representing approximately 3.6 % of the Company’s 21,751,211 total outstanding shares as of the close of business on July 7, 2026.

There is no assurance the Company will purchase any shares pursuant to this Board of Directors’ authorization.

Shares purchased by the Company, if any, will be retained as treasury stock and will be available for use under the Company’s stock option plan and for other corporate purposes.

For the 13 weeks and 39 weeks ended November 30, 2025, the Company recorded income tax provisions from operations of $ 1,037 and $ 2,562 , respectively, which included discrete income tax provisions of $( 21 ) and $( 59 ), respectively.

For the 13 weeks and 39 weeks ended December 1, 2024, the Company recorded income tax provisions from operations of $ 559 and $ 1,685 , respectively, which included discrete income tax provisions of $ 19 and $ 60 , respectively.

The Company’s effective tax rates for the 13 weeks and 39 weeks ended November 30, 2025 were 26.0 % and 25.6 %, respectively, compared to 26.2 % and 26.7 % in the comparable prior periods.

The effective tax rates for the 13 weeks and 39 weeks ended November 30, 2025 were higher than the U.S.

statutory rate of 21 % primarily due to state and local taxes and a discrete income tax provision for the accrual of interest related to unrecognized tax benefits.

The effective rates for the 13 weeks and 39 weeks ended December 1, 2024 were higher than the U.S.

statutory rate of 21 % primarily due to state and local taxes and a discrete income tax provision for the accrual of interest related to unrecognized tax benefits.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act ("OBBBA").

The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic research cost expensing, and the business interest expense limitation.

ASC 740, "Income Taxes", requires the effects of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the legislation is enacted.

The Company has completed its initial assessment of the OBBBA corporate tax provisions which were enacted on July 4, 2025.

OBBBA contained a number of U.S.

corporate tax provisions, of which the Company elected to expense U.S.

incurred research or experimental expenditures immediately and full bonus depreciation for certain assets placed into service after January 19, 2025.

As a result of the Company’s elections, it is expected that in 2025 U.S.

cash taxes will decrease with no material impact to its effective tax rate.

On January 13, 2026, the Company entered into an Equity Distribution Agreement with Needham & Company, LLC (“Needham”) and Citizens JMP Securities, LLC (“Citizens”) (the “Distribution Agreement”) with respect to an at the market offering program under which the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, par value $ 0.10 per share, having an aggregate offering price of up to $ 50,000 through Needham and Citizens as its sales agents or principals.

The Company is not obligated to sell any shares under the Distribution Agreement.

Subject to the terms and conditions of the Distribution Agreement, Needham and Citizens will use commercially reasonable efforts, consistent with their normal trading and sales practices and applicable laws and regulations, to sell shares of the Company’s common stock from time to time based upon instructions received from the Company, including any price, time or size limits or other customary parameters or conditions specified, subject to certain limitations.

Under the Distribution Agreement, Needham and Citizens may sell shares of the Company’s common stock by any method permitted by law deemed to be an "at-the-market offering program" as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended.

The issuance and sale, if any, of shares of the Company’s common stock under the Distribution Agreement are made pursuant to a registration statement on Form S-3 that the Company filed with the U.S.

Securities and Exchange Commission (“SEC”) on January 13, 2026 and was declared effective on January 21, 2026.

The offering is described in a prospectus filed as part of the registration statement.

During the fiscal year ended March 1, 2026, the Company sold 942,749 shares under the Distribution Agreement for gross proceeds of $ 22,822 .

The Company incurred expenses, including commissions, legal and accounting fees of $ 1,086 related to the offering.

In June 2026, the Company completed the program by selling 869,852 shares for gross proceeds of $ 27,174 .

For the 13 weeks ended May 31, 2026, the Company recorded an income tax provision of $ 1,268 , which included a discrete income tax provision of $ 0 .

For the 13 weeks ended June 1, 2025, the Company recorded an income tax provision of $ 694 , which included a discrete income tax provision of $( 28 ).

The Company’s effective tax rate for the 13 weeks ended May 31, 2026 was 26.4 % compared to 25.0 % in the comparable prior year period.

The effective tax rate for the 13 weeks ended May 31, 2026 was higher than the U.S.

statutory rate of 21 % primarily due to state and local taxes.

The effective tax rate for the 13 weeks ended June 1, 2025 was higher than the U.S.

statutory rate of 21 % primarily due to state and local taxes and discrete income tax provisions for the accrual of interest related to unrecognized tax benefits.

GEOGRAPHIC REGIONS

3 unchanged sentences

All of the Company’s long-lived assets are located in North America.

Financial information regarding the Company’s continuing operations by geographic region is as follows:

13 Weeks Ended

Financial information regarding the Company’s operations by geographic region is as follows:

13 Weeks Ended

North America

STORM DAMAGE CHARGE

The Company recorded a charge of $ 1,098 for storm damage in the 39 weeks ended December 1, 2024.

On May 19, 2024, the Company’s manufacturing facilities in Newton, Kansas were damaged by a strong storm which transited the area.

None of the Company’s manufacturing lines or equipment were damaged by the storm.

Although the building structures were secure, the roofs on all three buildings in the Company’s Newton, Kansas campus were damaged and required significant repairs.

Also, multiple specialty HVAC units were damaged or destroyed.

These specialty HVAC units are necessary to control the temperature and humidity in certain manufacturing areas, quality laboratories and R&D laboratories, which is required by certain specifications and certifications the Company is subject to.

The Company’s production lines were returned to full production within two weeks of the storm.

The Company did not lose any sales for the 2025 fiscal year;

however, $ 1.8 million of sales originally planned to be delivered could not be delivered before the end of the first quarter ended June 2, 2024 due to storm related delays.

The Company paid its employees for the days immediately following the storm despite many not being able to work while others worked on the clean-up of the storm damage to the facilities.

The Company incurred $ 78 of payroll and related costs for lost production time and employees working on clean-up.

The charge recorded by the Company in fiscal 2025 included an asset damage charge, emergency services by outside contractors, rental of temporary HVAC units and the cost of employee downtime or time spent on the clean-up of the storm damage to the facilities.

There were no such charges in fiscal 2026.

CONTINGENCIES

Total net sales

COMMITMENTS AND CONTINGENCIES

The Company is subject to a small number of immaterial proceedings, lawsuits and other claims related to environmental, employment, product and other matters.

16 unchanged sentences

The Company believes that the ultimate disposition of known environmental matters will not have a material adverse effect on the Company’s results of operations, cash flows or financial position.

On March 27, 2025, Park and ArianeGroup SAS entered into an agreement under which Park would advance funds to ArianeGroup SAS against future purchases of RAYCARB C2®B product in the total amount of € 4,587 payable in three installments in 2025, 2026, and 2027.

The advance would be paid as follows:

€ 1,376 was paid in April 2025 (actual cost of $ 1,564 ), € 1,835 to be paid in the first quarter of fiscal 2027 (approximately $ 2,142 based on January 7, 2026 exchange rates) and € 1,376 to be paid in the first quarter of fiscal 2028 (approximately $ 1,607 based on January 7, 2026 exchange rates).

These advanced funds are to be used to help fund the purchase and installation, by ArianeGroup SAS, of additional manufacturing equipment for ArianeGroup SAS’ production of RAYCARB C2®B product.

Under the agreement, the Company commits to purchase RAYCARB C2®B product through December 2033 at an estimated cost of € 36,000 .

The Company has a remaining advance of $ 1,596 in Other Assets on the Condensed Consolidated Balance Sheet at November 30, 2025.

On March 27, 2025, Park and ArianeGroup SAS entered into an agreement under which Park would advance funds to ArianeGroup SAS against future purchases of C2®B product in the total amount of € 4,587 payable in three installments in 2025, 2026, and 2027.

The advance is to be paid as follows:

€ 1,376 was paid in April 2025 (actual cost of $ 1,564 ), € 1,835 was paid in May 2026 (actual cost of $ 2,156 ) and € 1,376 to be paid in the first quarter of fiscal 2028 (approximately $ 1,575 based on July 7, 2026 exchange rates).

These advanced funds are to be used to help fund the purchase and installation, by ArianeGroup SAS, of additional manufacturing equipment for ArianeGroup SAS’ production of C2®B product.

Under the agreement, the Company commits to purchase C2®B product through December 2033 at an estimated cost of € 36,000 .

As of May 31, 2026, the unamortized balance of amounts previously advanced was approximately $ 3,749 and was included in Other assets on the Condensed Consolidated Balance Sheet.

OPERATING SEGMENT

5 unchanged sentences

SUBSEQUENT EVENT

On January 13, 2026, the Company entered into an Equity Distribution Agreement with Needham & Company, LLC (“Needham”) and Citizens JMP Securities, LLC (“Citizens”) (the “Distribution Agreement”) with respect to an at the market offering program under which the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, par value $ 0.10 per share, having an aggregate offering price of up to $ 50.0 million through Needham and Citizens as its sales agents or principals.

The Company is not obligated to sell any shares under the Distribution Agreement.

Under the Distribution Agreement, Needham and Citizens may sell shares of the Company’s common stock by any method permitted by law deemed to be an "at the market offering" as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended.

The issuance and sale, if any, of shares of the Company’s common stock under the Distribution Agreement will be made pursuant to a registration statement on Form S-3 that the Company expects to file with the U.S.

Securities and Exchange Commission (“SEC”) on January 13, 2026, if and when that registration statement is declared effective.

The offering will be described in a prospectus filed as part of the registration statement.

In July 2026, the Company entered into a sublease agreement covering approximately 18 acres of land in Tulsa, Oklahoma.

The Company plans to build a new composites material manufacturing and development facility on the site.

The facility will include full production lab facilities, office space, storage and freezer space and ancillary equipment necessary to support all planned manufacturing operations.

The sublease commences on September 1, 2026 and has an initial term of 25 years with a renewal option for an additional 25 years.

Annual rent under the sublease agreement for the initial five years of the sublease would be $ 269,469 with increases for each subsequent five-year period based upon the Consumer Price Index for All Urban Consumers, U.S,, City Average All Items as published by the United States Department of Commerce.

The Company expects economic development incentives to offset a significant portion of rent expense.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements