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Park Electrochemical net income boosted by tax law change

Park Electrochemical's headquarters in Melville.

Park Electrochemical's headquarters in Melville. Credit: Newsday/J. Conrad Williams, Jr.

Park Electrochemical Corp., a Melville maker of composite materials for the aerospace market, Thursday reported second quarter net income from continuing operations more than doubled, a result fueled in large part by the new federal tax law.

Net sales for the period ended Aug. 26 edged down to $11.2 million compared with $11.4 million in the prior year's quarter.

Park shares  lost  1.2 percent Thursday to close at $19.52. The stock was trading at $16.07 12 months ago.

Net income was $1.8 million, or 9 cents per diluted share, versus $859,000, or 4 cents per share, in the year-earlier period.

The latest quarter's net income was bolstered by a one-time tax benefit of $788,000 related to the federal Tax Cuts and Jobs Act enacted in December.

The company reported its printed circuit materials unit, which had been its primary business, as a discontinued operation. In July, Park agreed to sell that business to Tokyo-based AGC Inc. for $145 million in cash and focus on its unit that makes composite materials and assemblies for aerospace manufacturers.

The closing of that transaction, originally expected in the third quarter, now could be delayed until December or January, because of slower-than-expected regulatory review, chief executive Brian E. Shore said in a conference call Thursday.

Shore said Park is forecasting revenue for the third quarter at $12.25 million and the next fiscal year at $58 million to $63 million.

In response to a question, Shore said the company is "trying to find inroads" on Defense Department projects aimed at developing hypersonic technologies. Hypersonic weapons and aircraft fly at five times the speed of sound — Mach 5 — or higher. The United States is racing to develop hypersonic weapons amid reports of progress by Chinese and Russian arms makers.

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