Good morning. My name is Terrance and I’ll be your conference operator today. At this time, I would like to welcome everyone to the Park Electrochemical Corp Fourth Quarter Fiscal Year 2017 Earnings Release Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. At this time, I will turn the call over to Mr. Brian Shore, Chairman and Chief Executive Officer. Mr. Shore, you may begin your conference.

Thank you, Terrance. This is Brian. Good morning everybody, welcome to our fourth quarter conference call. I have with me as usual Matt Farabaugh, our CFO. Matt and I will start with some introductory remarks and of course then we’ll go to questions. Matt, why don’t we get started with some of the financial commentary. Sorry, I always forget to tell you this, a transcript of Matt’s comments are already posted on our website, so if you want to go look at the details you can at our website as well. Go ahead, Matt.

Certain statements we may make during the course of this discussion which do not relate to historical financial information may be deemed to constitute forward-looking statements. Any forward-looking statements are subject to various factors that could cause actual results to differ materially from our expectations. We have set forth in our most recent Annual Report on Form 10-K for the fiscal year ended February 28, 2016 various factors that could affect future results. Those factors are found in Item 1A and after Item 7 of that Form 10-K. Any forward-looking statements we may make are subject to those factors. I'd like to briefly review some of the items in our fiscal year 2017 fourth quarter ended February 26, 2017 P&L, which are not specifically addressed in the earnings release. During the fiscal year 2017 fourth quarter, North American sales were 55% of total sales, European sales were 7% of total sales and Asian sales were 38% of total sales, compared to 49%, 7% and 44%, respectively, for the 2016 fiscal year fourth quarter and 49%, 10% and 41%, respectively, for the 2017 fiscal year third quarter. Sales of Park’s high performance non-FR-4 electronics materials were 94% of total electronics materials sales in each of the 2017 fiscal year fourth quarter, the 2016 fiscal year fourth quarter and the 2017 fiscal year third quarter. Park’s electronics sales were $19.4 million, or 70% of total sales, in the 2017 fiscal year fourth quarter compared to $26.9 million, or 75% of total sales, in the 2016 fiscal year fourth quarter and $19.0 million, or 72% of total sales, in the 2017 fiscal year third quarter. Park’s aerospace sales were $8.2 million, or 30% of total sales, in the 2017 fiscal year fourth quarter compared to $8.8 million, or 25% of total sales, in…

Thanks Matt. This is Brain again. Okay, let me get started with the Trump factor, we talked about on our third quarter call and this relates to the surprise with the election and the impact that it may have on the tax laws. So, I’m not sure if things are more clear now than they were during our third quarter call before the inauguration, but obviously taxes are still front burner topic. I guess the most people say it's a matter of when more than if and then of course what will happen, but the expectation is that the corporate tax rate will go down and it will be some kind of repatriation provision or holiday we don’t know. As we mentioned last time, once that does occur, once the new tax law goes into effect, whenever that is we're hoping it would be this year, and now I don't know maybe it still will be, but it is very difficult to tell, everybody seems to have a different opinion. That point though we would expect to repatriate a significant amount of our funds overseas. We have about $240 million overseas, if we repatriated through those funds now, we’d have about $60 million tax bill which obviously we don't want to have. At that point we would expect to do a large return of capital to the shareholders this is basically what we’re waiting for, we don't need the amount of cash that we have, but we have it kind of locked overseas, whether that being a dividend or buyback and probably mostly dividends but maybe buyback as well. We mentioned that last time, I just wanted to update you and the update is we're just kind of still in the wait and see mode. All right, so that's that…

[Operator Instructions] And our first question comes from Sean Hannan from Needham & Company. Your line is open.

Yes. Thanks very much for taking my question here folks and good morning. The first question I’d have here is in terms of the progress that you are making on the electronics side. You’ve been securing a number of customer agreements, you've secured a large OEM customer. Just trying to get a sense of to what degree other than the statistics that you had laid out there, Brian that you feel that you can keep that momentum moving forward. So in that sense, continue to grow those numbers in terms of quals, et cetera, et cetera as we progress through the year. And then kind of as a part b to that, other than being able to get the opportunity for a perhaps, some growth within electronics in the back end of this year, the degree that you see that there's some sustainability to that on perhaps a little bit more than a few quarter basis.

Okay. Sean, thank you. And first of all, it’s not just one OEM agreement. You’re probably referring to Huawei, sometimes I refer them as a big dog, but there are other OEM agreements we have. So the momentum sustainability, I think that's really the key question. My opinion is that the momentum is growing and growing, but it's about the amount of effort. If we back off and we stop spending all the time, especially Chris and his guys in Asia, that momentum will not continue. In other words, it's not like a self-perpetuating momentum. But as long as we keep doing what we're doing, my sense is clearly that momentum will keep growing and growing and we're building on what we've done and the more we do and more interest there is and it kind of is a contagious thing. So, like I said earlier, the circuit board s hops, they want to get on board because they want to make sure that they’re working with the key OEMs, right. And some of the larger OEMs and some of the maybe more niche OEMs or smaller OEMs in Asia, they hear that we made significant inroads with larger OEMs. So they don't want to miss the boat either. I think the product is performing really well. It's very good with our Meteorwave and I think it's gotten a very good reception in Asia. It's very highly sought of and not just by us, not just by the OEMs, not just by the circuit board shops, but by our competitors as well. I'm not speculating about that either. So as long as we keep doing the right thing, I think the momentum will keep growing and we talk a lot about the quarters because I think that's what the analysts…

Okay. That’s very helpful. And then switching gears over to the aerospace side, can you talk a little bit Brian about how you're thinking of the business continuing to grow from here. In the past, you’ve talked about some, or provided some general comment around the degree of growth and magnitude say of ramp that could start to materialize in ‘18 as an incremental, ‘19 as an incremental, et cetera. As we’ve stepped back, can you help us to kind of either reconfirm or reset or recalibrate how you’re thinking about growth within this aerospace business, given all of the progress that you’re making and particularly as you think about your internal planning efforts moving forward from here? Thanks.

It's difficult to quantify a little bit. But I guess I would say the news continues to be better and better all the time. The opportunities keep coming. They keep compounding. I mentioned, there are now three different new product opportunities we’re working on with Emirates. Each one of those product opportunities has a significant amount of revenue behind it. So once we get qualified with these new products, there's a significant, we are on these programs, there is a significant amount of revenue. As you know, we’re sole source with Emirates and the products that we do provide them and that seems to be the mindset. So and we haven’t - we really haven't put the GE Aviation part of the equation into discussion very much at this point. As I said, we’re working on - this year, we plan to do the long term contract with GE Aviation, except for that one part opportunity we talked about. This other big company. So we had a successful audit if you will a few weeks ago. Actually, the company was quite complementary. I think they said they're quite surprised at how well we did or maybe even more than surprised, I forget it was a kind of pretty adjective actually. Your two other specifications that are coming behind that we’re planning on working on, timing is difficult for me to nail very well. So we're reluctant to try, because I think to some extent, I’d be guessing. The ramp with Emirates, we’ve commented on that before. That really hasn't changed very much. Every now and then, it seems they’ve got pushed out to the right a little bit. I think we commented previously that there were some inventory correction issues and we're still dealing with that this year. We hope in the next few months, that will be out of the way. The big story with Emirates is the A320neo, the LEAP engine. That's really a driver and my sense is that we're getting into a mode now where the issue is going to be keeping up. Not so much us, but maybe the customer, because the ramp is pretty steep with the A320neo. As I mentioned in the introductory comments, Sean, we need to go back and talk about the redundant factory. That's still very much in the table. Now that we have the long term agree behind us and especially since these other three opportunities are very much on the table, so I suspect you're looking for more quantification, and I’m giving you more of a qualitative answer. But I think that's probably about the best that we can do at this time.

Well, I suppose in a general sense, are we still expecting that there's going to be, the way that the numbers play out next year, calendar year that we should still absorb or experience some material growth within aerospace, however, you might define material, but that is going to be pretty standout versus what we’ve been looking at more recently?

Yes. Based upon the forecast, that's correct. I don't like using words material because they have legal significance. So let’s just say significant. So based upon the forecast, I was just looking at it, yeah, we are looking to see some significant growth next year and next year, we really should have all the inventory issues absorbed and adjusted. They will no longer be holding down the revenues.

And to what degree do you feel that that’s still suppressing revenues right now. My impression had been that it's gotten pretty marginal?

No. Unfortunately not. We thought the same thing I think a few months ago or so and then some additional inventory kind of turned up at a supplier. So that became an issue as well. I think it's still suppressing our revenue to let's say a significant extent, but I think that should be done all the way behind us within two or three months.

And at this time, I’m showing no further questions. I’d like to turn the call back to Mr. Brian Shore for any closing remarks.

Okay. Well, thank you, operator and thank you everybody for listening in today. Matt and I are in the office of Melville. So if you have any follow-up questions, please give us a call. Anyway, thank you again and have a good day. Good bye everybody.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the program and you may now disconnect. Everyone, have a great day.