In the third quarter of fiscal 2025, Park Aerospace Corp (NYSE: PKE) reported revenues of $14.4 million, a slight increase from the expected range but fell short on earnings before interest, taxes, depreciation, and amortization (EBITDA) due to unexpected production shortfalls. The gross margin was 26.6%, indicating challenges with cost management and pricing strategies, as management expressed dissatisfaction with gross margin levels below 30%. The company is transitioning to new production lines aimed at enhancing efficiency, but the ramp-up has incurred additional costs, affecting profitability. Despite these hurdles, future revenue projections from key programs and a solid cash position suggest potential for recovery.
Key Performance Indicators
Revenue
Decreasing
14.41M
QoQ: -13.77% | YoY: -11.79%
Gross Profit
Decreasing
3.83M
26.57% margin
QoQ: -19.53% | YoY: -14.04%
Operating Income
Decreasing
1.85M
QoQ: -29.46% | YoY: -28.20%
Net Income
Decreasing
1.58M
QoQ: -23.67% | YoY: -40.94%
EPS
Decreasing
0.08
QoQ: -21.10% | YoY: -39.31%
Revenue Trend
Margin Analysis
Financial Highlights
Revenue for Q3 was $14.4 million, a 13.8% decrease year-over-year and a 14.8% drop quarter-over-quarter. Gross profit registered at $3.83 million, representing a gross profit margin of 26.6%. Operating income was $1.85 million, with a margin of 12.8%, showcasing operational pressures. Net income fell sharply to $1.577 million or $0.078 per diluted share, reflecting a 40.94% decline in net income from Q2 2025. The company maintains a strong current ratio of 7.55 and a quick ratio of 6.69, indicating healthy liquidity.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
14.41M
-11.79%
-13.77%
Gross Profit
3.83M
-14.04%
-19.53%
Operating Income
1.85M
-28.20%
-29.46%
Net Income
1.58M
-40.94%
-23.67%
EPS
0.08
-39.31%
-21.10%
Key Financial Ratios
Gross Profit Margin
Fair
26.60%
Gross profit margin is moderate, room for improvement in cost management
Operating Profit Margin
Fair
12.80%
Operating margin is moderate, room for improvement in cost management
Net Profit Margin
Good
10.90%
Net profit margin is healthy and competitive within industry standards
Return on Assets
Weak
1.27%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
1.47%
Return on equity suggests inefficient capital allocation
Current Ratio
Strong
7.55
Current ratio indicates excellent liquidity and financial flexibility
Debt to Equity
Conservative
0.00
Debt-to-equity shows conservative leverage and low financial risk
P/E Ratio
High Growth
48.21x
Very high P/E indicates aggressive growth expectations, higher risk
Price to Book
Fair Value
2.83x
Price-to-book ratio reasonable for profitable companies
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