On lower Q1 results, Park Electrochemical Corp. continues shift to Asian market
Executives of Park Electrochemical Corp. (NYSE: PKE) outlined the company’s future in Asia on a midday Wednesday conference call. The company, which makes printed circuit materials for computer components, plans to open two new manufacturing plants. A Singapore plant, which will manufacture advanced composite components for aircraft, should be open by the end of the calendar year, CEO Brian Shore said on the call.
“The movement continues to Asia,” Shore said. “The long-term trend is moving more and more production to Asia.”
Manufacturing of PTFP, a microwave wireless communications product, has been moved to the company’s China plant. Shore said PTFP is a high-growth market in Asia.
The company is also in the final phases of site selection for the construction of a Wichita, Kans.-area manufacturing plant. The company picked the Wichita area because Shore said it is “the center of the universe for general aviation aircraft manufacturing.”
Other countries are feeling the pull of Asian manufacturing. The company’s plant in Dijon, France, is under stress because of the “migration of the Western electronic manufacturing industry to Asia,” Shore said.
“The long-term trends are very obvious to us and very much in existence. Asia has been stronger as of late,” Shore said. “The Western market has been weaker for digital circuit materials.”
The Melville, N.Y.-based company reported a $7.4 million, or $0.37 per share, profit for the first quarter ended May 27, compared with an $8.9 million profit, or $0.44 per share, in the same period of 2006.
In midday trading, shares in Park Electrochemical are down $3.21, or 10.17%, at $28.34.
Also on the call, Shore said:
• The European market for advanced digital circuit materials is weak
• The company is not in a position to provide guidance on the tax rate because “there are a lot of variables, a lot of factors,” but “by default, you might want to consider using [the current tax rate of 24.7%]”
• Copper prices have gone up and the company is passing these increases on to customers
