Good afternoon. My name is Julian, and I'll be your conference operator today. At this time, I'd like to welcome everyone to Park Aerospace Corp's fiscal year 26 Q4 investor call and presentation. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, please simply press star, then the number 1 on your telephone keypad. If you'd like to withdraw your question, please press star 2. Thank you. At this time, I will turn today's call over to Mr. Brian Shore, Chairman and Chief Executive Officer. Mr. Shore, you may begin your conference.

Thank you, Operator. This is Brian. Welcome all to the Park Aerospace's Q4 Investor Conference Call. Thank you for joining us. With me, as usual, Mark Escobar, our President and COO. So we published our fourth order earnings release just after the close. If you haven't accessed that, you probably want to do that. In the earnings release, there are instructions as to how to access the presentation that we're about to go over. You can – there's a link that's provided. Also, you can access that presentation on our website. You want to do that, so the call will be meaningful. So we'll review our presentation, of course, with you, and then we'll be happy to answer questions. I just want to comment that we have a lot of new investors or potential investors at PARC. During our third quarter call in January, there were over 150 participants. That's a lot for us. And I suspect that interest might continue. So the point is that we have a lot of new potential investors or investors. Then we have the veteran investors. So we have to balance between covering the old stuff again and not covering it too much. I know sometimes when we do that, the better investors get a little impatient that we're going over things we already went over. But out of respect for our new blood and new investors, we want to go back and cover some of these things that we cover every quarter. So we'll do the best we can to find a middle ground and compromise. And that, of course, means that nobody's going to be happy. But anyway, we'll do our best, of course. When we go ahead and proceed, and we'll go right to slide two, which is our forward-looking disclaimer language. We're not going to read this for you, but if you have any questions about it, please let us know. Let's go to slide three, table of contents. Slide one, we start with our investor presentation, and in appendix one, there's supplementary financial information. We don't normally cover that during our call, but please let us know if you have any questions about it. Our practice has been in our table of contents to feature something about the James Webb Space Telescope. We discovered these little red dots, a new class of object. You think about the new class of object.

I didn't know what to make of that.

Small, extremely red points of light that represent a potential seeding of early supermassive black holes, challenging our understanding of galactic formation and evolution. Thank you, James Webb. and the James Webb was produced with 18 proprietary sigmas, parked sigma struts. So this is not a high-volume program for us and probably not an opportunity for many spares since the James Webb is in the orbit a million miles away. We're probably not going to send anybody up to replace any of the sigma struts. But even though it was a small program in terms of revenue, we feature it every quarter now for the last, I know, couple of years, because it's just such an incredible thing to be part It's just amazing. I mean, it's hard to describe. The words don't even get it, and amazing doesn't really get it, because we're – almost everything here that comes from James Webb says everything we believe, the smartest people in the world believe about the universe was not true. We have to start all over again. So we're just – I don't know how to say it. We're just so thrilled to be part of that, to James Webb. But, again, even though from a business financial perspective, it's, you know, not a big impact, and like I said, probably no more revenue from the James Webb anytime soon. Let's go into slide four, going from the lofty to the, I don't know, mundane, but a little different kind of level, our own quarterly results, important, but maybe not quite in terms of important in terms of the, you know, I don't know, the history of the universe perspective, but nevertheless, we'll go over our quarterly results. Q4 sales, $24,187,000, gross profits, $6,935,000, gross margin, $28.7,000, which, as you know, we don't like that too much. We don't like where the gross margin is full of 30%, but when we get the next slide or two, we'll explain what's going on here. That relates to the significant shipment sales of C2B fabric. Adjusted EBITDA, $5,171,000, and EBITDA margin, 24.1%. What did we say about our Q4 during our January 13 Q3 investor call? We said our sales estimate was 23.5 to 24.5, so we came in within the range, maybe kind of the top half, but still within the range. Just even an estimate, four and three quarters to five and a quarter million, and it seems like we came in within the range, maybe the top half of the range, which is good. I need to explain, especially for some of our new potential investors, investors, that when we give an estimate, we're telling you what we think is going to happen. We don't like this kind of thing that people do where they, you know, give a number, but, you know, they haircut it by 10%, you know, so they can beat the number, and they have a beat. I don't like that term, and these analysts come up with this sort of stuff. Like at some game, we're not playing a game here. You know, we don't like to make us uncomfortable. We're not playing the game, but the whole concept is a beat, it's a beat, it's a beat. We don't want to beat. When we give you a number, we're telling you what we think is going to happen. And if we're wrong, that means we didn't do a very good job. Now, sometimes we'll be rolling high. Sometimes we'll be rolling low. But we're not trying to do that. We're not trying to give you a number that we can beat so we can be a hero. To us, that seems like such a childish waste of time. And I just want you to understand that. So when we say we're in a range, that's a good thing. And that means our prediction was right. So I probably cover that every quarter because it's a little different with, you know, many other companies how they do that kind of guidance thing. And it's not something we really have to spend time with. Let's go into slide five, okay? Talk about two-four a little bit more. Area and group, here we go. And now we're, you know, talking about that gross margin number. Area and group, business partner agreement, we talk about this every quarter, you know, significant from many perspectives. But in terms of the quarterly P&L, so we entered into the Business Partner Green Book area in January of 2022, under which area of Point of Park is their exclusive North American distributor for their Raycarb C2B fabric use or produce ablative composite materials for advanced missile programs. Now, we had 7.1 million of C2B fabric sales in Q4. Well, that's a lot. I mean, 7.1, what was our number?

At 24.1, so it's a, you know, very high percentage.

As we previously explained, we sell C2B fabric to our defense industry customers for small markups. You say, well, that's not so good. Well, wait a minute. That's not the whole story. Park sold 1.3 million of ablated materials manufactured with C2B fabric in Q4, and as we also previously explained, the margins for producing and selling ablated materials manufactured with this fabric are significant. Now, what's going on here? When we sell the product, we buy it from Arian because we're exclusive, we have exclusive rights to buy it in North America, that we sell it to the OEMs because what are they They're stockpiling their product. Where does it go when they stockpile it? In our factory. We don't even ship to them. We hold it for them in our factory. Why are we doing that? They're stockpiling it because obviously you're going to tell us at some point, please make this into your prepreg material. Please produce the material for us. So everything that we stockpile will end up being produced by PARC as a blade of material, which is where those margins are very good. So stockpile is good, and they're doing it because they're, the OEMs are doing it because they're concerned about the availability of this very critical C2B fabric. Let's go on to slide six, the shipments. Now, this is interesting because we started talking about this at the beginning of the pandemic. Like, you know, the industry was not doing well, supply chain, international shipments, so one thing after another after another, and every quarter with a lot of misshipments, you know, that calmed down quite a bit over the last couple of years as things kind of got close to, quote-unquote, normal based upon the post-pandemic levels, all right? But what's going on here is this is now reemerging as a problem because now the industry is accelerating, are covering, and the program starts accelerating, so now the industry is kind of struggling once again with keeping up from a different perspective, but it's the same kind of phenomenon, it's just from a different perspective. So now we're talking once again about this shipment, 7,000 or 15,000. Well, that's a lot, and we talk about Q1 or Q1 forecast, it's going to be even more. So it's something to think about. Ultimately, all this product gets produced and shipped, but the industry is now struggling again to keep up as the industry accelerates and ramps. Net impact of tariffs, tariff-related costs. Mark, could you help us with a little perspective on tariffs and tariff-related costs, please?

Yeah, it's the same story as, you know, the last few quarters. Very minimal impact for us. Again, we typically pass these on to our customers through our pricing contracts or as we do pricing every few months with our regular business. So no impact for us, but maybe a few thousand dollars this quarter.

All right. Thanks, Mark. So why don't we keep going?

We can hustle through here.

So slide seven for some of you new folks. This is something we do every quarter for, I don't know, as long as we've been doing presentations, I guess. Our top five customers for the quarter, in alphabetic order, and we do a little picture that, you know, kind of ties into each of the customers. The top right, you know, you'll hear a lot about just the Pact-3 Patriot missile system. That's two for the price of one, because that actually is 80 Aerospace and Elfri Harris, so that's nice.

We've got one picture for two.

Kratos is obviously a Kratos BQM. That's a target drone, middle of the air structure. We'll talk more about them. That's the Airbus H320 with the lead-boiling engine, and Nordam is the Boeing straddle tanker. So let's keep going. Pie charts. These have gotten a little boring, but they're becoming interesting again. So we'll take a look at this park estimated revenue by aerospace market segment. See in 21, that was the – fiscal 21, remember where our fiscal year is in February, that was a pandemic year. Look what happened. It wasn't the military was so great. It's just commercialism with nothing. I remember that you saw the pictures of, like, the 737s with two people on them, or probably more likely they really parked. They weren't flying at all. But commercial aerospace was terrible, and the airlines weren't ordering any airplanes. They were canceling as many as they could. So you see that happened in 21. In 22, 23, 24, and 25, it kind of normalized, quote, unquote, for the pandemic level, post-pandemic level, which was, you know, kind of anemic, let's call it. But look at 26. There's something emerging there where the military is actually increasing more than it had been. And if we showed you Q4 of 26, it would be kind of shocking how strong, how significant the military is. We're not going to do that because we don't want to get hung up on one quarter. But we think there might be a trend going on here. We look at 26, which, you know, is in the bottom middle of the slide. And let's go on to slide nine, a little more pie chart stuff. This is another slide we include for every quarter, PARCLUDs, niche military airspace programs. The top five, that's done by Donna, and this one's done by Elena. Elena's head of customer service of PARC. This is her thing she does every quarter. PARCLUDs, niche military airspace programs. So these are not necessarily the big programs here, just some are big, but some may not be. These are programs of interest, we thought you'd be interested in them. I just want to be clear, everything we show here, everything we show every quarter, those are programs we're involved with or supplying them to involve with. We're not just, you know, show you nice pictures of rockets and planes and cool stuff like that. So we just want you to be aware of it. We don't comment anymore on what we do with these programs. We've just got to be too sensitive. But just understand these are all programs that we supply into. And the bi-chart, look at missile systems, you know, that's getting to be pretty big And that's not, I don't think that's an anomaly. We'll talk about missile systems as we proceed with the presentation. I'm trying to hustle through it because the back end of the presentation, we get to missile systems. There's a lot to talk about. That's a lot of new stuff also. So slide 10, GE Aerospace to Engine Programs, we provide the slide almost every, not almost every quarter, very minor changes. I do need to explain for some of our new investors. The firm pricing LTA is a requirements contract from 1929 with Middle River Air Structure Systems, who at A don't know, they're a sub of SD Energy Aerospace, who at A don't know. We built a redundant factory. That was part of the deal that we actually made with GE Aerospace when we entered into the LTA through 29. We agreed to build and we're done in the factory. That was done a while ago. It was in production. Sole source for compiled materials for various in-unit cells, retroversive components, multiple MRS programs. We have the H320 NEO family, 747, the COMEC 919, the COMEC 909, the Global 7500, and And the next slide is the 777X. Well, what's going on here? These are all GE engines, aren't they? We didn't say about GE and also CFM, which is, you know, part of the ship with GE. So the thing is that when we entered into this contract, Middle River MRAS, where they produce the cell and thruster-versed structures from these engines, was a sub of GE. And I think in 19 or 20, I don't remember when, GE sold this MRAS to FC Engineering, which is a large Singapore aerospace company. That's the reason why all these programs are GE Aerospace, called GE Aerospace Programs. So questions let me know, but let's just keep moving here to slide 11. Okay. We already talked about this, 777X, that's one of those, GE 9X, that's GE Engine, of course. And in this LTA, we also included some of our new film proprietary products and for composite bond and metal bond, and those products are under equal and qualification. We've been talking about a LIFA program agreement to kind of supersede a 10-year deal for, you know, every quarter of a while. And this was requested by MRAS and SDE, not by PARC. We're happy to do it. It's under negotiation. We actually made some progress recently, but we'll see. You know, it's still a way to go to get this finish line, as we always say. We're happy either way. If we do the LIFE program, that's wonderful. If not, we're okay, too. Let's go on this slide. 512, keep moving along here, it's still in GE. Up in GE Aerospace and Engine Programs, let's go through the programs in a little more detail. First, we start with the big kahuna, which is the A320 aircraft family, includes all these different variants. As of March, the Airbus has already delivered 4,553 of these airplanes and had a backlog of 7,412, these airplanes. So you have those two numbers together, and the total is a big number. This is a huge program and, you know, could be the biggest commercial aerospace program ever, aircraft program ever. I-320 and EO Family Aircraft Deliveries, you see the pattern here, they're ramping up. In 19, you got to 561, and the pandemic hit, everything collapsed down to 431. Kind of is going your way back to the, you know, that 561 level, kind of got there in 23, 24, 25, you know, inching forward, the 50 in March, 51 per month. But let's go to the next slide, slide 13. Well, one more hint before we get to that punchline, 26-year-to-date, 136 deliveries. That's not so good. Off to a low-star Airbus' day-through-20, the aircraft family. Why is that? What's going on? Well, Airbus have been targeting 75 NEOs per month by 27. They've been very public about that, so look in the prior page, we're kind of inching up to 51, we're nowhere close to 75. Airbus recently stated they expect to reach that deliver rate of only 75, 70-75, so they're backing off by the end of 27, stabilizing, that's their term, to a rate of 75 per month or after. So they're backing off a little bit. What's going on here? Why? What's the problem? Maybe we should consider the engine situation. So sorry, it's a little complicated, but, you know, we need to give you the perspective, I think, the two approved engines for the AT-20neo aircraft family. There's the CFM Leap 1A engine, that's what we're on, and then there's the Pratt PW1100G We're not on that program. So we supply it to the AT-20neo family aircraft using the LEAP engine, but we don't have any concepts on the AT-20neo family aircraft using the Pratt engine. It's important to know that. Let's go into slide 14. Now, according to the first quarter, 2026 edition of Arrow Engine News, that's in our Bible, the CFM Leap 1A market share firm engine orders for day-to-20 NEO was 66.2%. Now, that's interesting. Like, what the heck is that number about? You know, we cover this every quarter, and, you know, the number has been like 60%, 61%, 60%, 66.2%. That's not the historical number. That marketer moved up. It's sustainable. It's a trend we'll see. But at the delivery rate of 75 airplanes per month, 62.2% equals 1,192 LEAF engines per year. Do you remember that number? We'll get back to it later. You know, interesting number. The Pratt engine has, now here's the kind of the issue. The Pratt GTF engine has struggled with serious reliability issues.

You can probably read about this, you know, it's not a big secret.

Reliability is a positive selling point for a CFM LEAP 1A. They upgraded one of the components recently for better reliability. And according to Airbus, this is recent, there is now a serious shortage of Pratt PW1100G engines. And Airbus indicated that's the main cause of their disappointing 2026 A320neo aircraft film and deliveries. They're kind of putting the blame on this freight engine, not only with the reliability issues, now with shortages. Meanwhile, CFM has significantly ramped the production of their LEAP engine family, including the LEAP 1A. So let's keep going here. Let's see if we can figure out what really is driving on this slide 15. Could these factors lead to an even greater CFM LEAP-1A engine market share of A320? I don't know. Interesting question. Now, we sort of read recently something that surprised us, which is Airbus now saying, well, you know, CFM is delayed on deliveries as well for the LEAP-1A, so I don't know what that means. The focus had really been on the Pratt engine, but now they're saying, well, you know, Leap is fine as well, so I'm not sure what to make of it. My guess is that the CFM can produce the engine, but they have an opportunity for more and more consured gains, but, you know, that's their business, not mine. As of March 31, there were 8,472 Leap 1A engine orders. That's a lot of orders for engines. And if you look further later on in the presentation, we talk about our revenue per engine based upon current pricing. You can do your own math and figure it out. But, you know, we're talking about some very large numbers here. A320 Neo Aircraft Family Program could end up being the world's largest commercial aircraft program ever. So we're very happy to be on that program. Day-through-20 NETO aircraft program could end up being Park's largest non-defense program ever. And that goes back a long, long time. We're talking electronics, you know, back in the 90s and everything else. So that's a big statement. Let's go on to another LEAP program, which is the COMAC 919. That's a Chinese single aisle to compete with the H-320 and the LOAN 737. COMAC is increasing manufacturing capacity to achieve production rates of 150 919 aircraft a year by 27 and 200 by 29, and they reportedly have over 1,200 orders for the 919 aircraft. Let's go on to slide 16. COMAC delivered two of these airplanes in 23, 14, 24, and 18, and 25, that's not a lot. COMAC was targeting 25, that's not a lot, 25 and 25, but didn't get there. So there are reports that CFN may be favoring only Airbus with LEAF engine availability. Now these are different three-year engines, they're not interchangeable, but there's still It's still a capacity question as to how many LEAP engines that CFM can produce. So, and the lack of availability of CFM LEAP1C engines may explain the shortfall and may be emerging as more impactful to the ramp of the 919-acre program than originally anticipated by COMAC. Now, will this change improve for CFM, sorry, for COMAC after CFM as a result of the recent summit with President Trump and President Xi? The answer may be yes. There are reports that there is some plan to increase CFM LEAP-1C engine deliveries to COMAC as a result of that summit, so we'll see what happens with that. But, you know, you get the theme here. It seems like the engines are often negating items on these programs. Slide 17, let's talk about the 777X program. That's the other, the third big program that we're dealing with with GE Aerospace engines. The 777X program, the GE 9X engines, the 777X tech program is masked over 1,500 flights, nearly 4,400 flight hours. We have 652 Boeing has 652 open orders for the 777X, and the certification test program seems to be moving along reasonably. Boeing anticipates FA certification entry into service and first delivery of the 777X next year. This program is very, very, very delayed, you know, delayed a long time. I happen to be at Everett Field where Boeing makes these airplanes, I think the biggest building in the world, actually, and they're all over the field. They're everywhere.

A lot of cases they don't have engines that are waiting for engines, obviously waiting for certification.

They can't start delivering the airplane until they get the FAA certification. Let's go on to slide 18. So these points are kind of key. Our understanding is that the COMAC 919 aircraft and the global 8,000 aircraft are already being produced and delivered and are close to targeted rates. We covered that in that original slide where we, you know, broke down the different programs. We didn't really deal with them in any detail. The point is that we're not expecting much upside for those programs because they're already being produced at their targeted rates. Clearly the commercial aircraft juggernaut, as we call it, will be driven by the ramp-up of the A320 and the NEO aircraft family, the Boeing 777X and the COMAC 919 aircraft. Okay, let's go on to slide 19, we're still talking to the aerospace system numbers for you here. The aerospace engine program sales history and forecast estimates. So in Q4, 8.1 million, and then fiscal 26, 29.3 million. See what happened here. Look at 20. We were kind of almost at 29 million right before the pandemic, and wow, look what happened to 21. Just dropped off a cliff, and we're clawing our way back in 26 to kind of get back to where we were in 20, right before the pandemic. So, and it's been a long five years for the special commercial aircraft industry, that's for sure. So our forecast for Q1 for GE Aerospace Program Sales, 6.8 to 7.4 million. Our forecast for the year, 34 to 38 million. It would be a mistake for you to take Q1 for anything multiple by four and think that's who we're thinking about. It doesn't really work that way. The forecast for the year, that's based upon what we have called a bill plan from our customer, and we haircut a little bit. You know, the number we got from our customer is actually higher than the forecast we're providing you. We're trying to be more conservative here. Let's go on to slide 20. Okay, now let's talk about PARC numbers, PARC financial performance history and forecast estimates. Top is just history, totals you already know about, the Q4 you know about. of totals you know about, or you know about now anyway. Forecast estimate for Q1, 17.7, 18.4 million in sales, 4.1 to 4.6 million EBITDA. Now remember we talked about misshipments in Q1, we're expecting 1.3 approximately significant amount of misshipments. We don't know yet, you know, Q1 ends on Sunday. We're so close to the end of the quarter that we can give you some perspective. Normally, when we announce, you know, the misshipments normally really end up being a phenomenon in the last few weeks or a quarter. Normally, when we announce, we can't give you any perspective on it, but we're so close to the end of the quarter, we get the perspective. It's the same kind of thing, you know, supply chain thing. We're not getting components as quickly as we need. Some shipping issues where if the freight forwarder doesn't pick it up, you know, international shipment, it's not a sale. You know, we don't have any sales cutoff issues at PARC. You know, it's a sale when it leaves our dock. So, you see, you know, we're kind of back in that mode now, and the industry is struggling. These industries are starting to re-struggle. It's like these things are ramping up aggressively. Things were quiet, and things were kind of normalized, and the industry kind of caught up. But now we're back to maybe getting behind the power curve a little bit. And let's see how that pans out. But, I mean, I don't know. It may take, I don't know, a couple years for the industry to, you know, get back up to speed. Or maybe they'll always be behind because things are ramping so aggressively, you know. As soon as they catch up, then they'll turn around and, oh, we ramped more. We'll have to see about that. Slide 21. We're just, you know, trying to share the full perspective with you. Slide 21. Let's stop here for a second. I know we're kind of running late here. But our historical fiscal year results, because it tells a story that's kind of interesting, I think. Look at the sales. This is aerospace only. We sold electronics. I think in 19, but it's aerospace only, you know, 31.8, going year over year, 40.2, 51.1, 60. So from 17 to 20, we kind of were moving up $10 million per year in aerospace, which is a lot. Then look right after 21, we're just going to sell off a cliff. There's a pandemic year. And 22, 23, 24, maybe 25, we try to crawl our way back to, you know, the 20, the pre-pandemic fiscal year, and maybe just got there in fiscal 25, but it has been a difficult five years post-pandemic for the industry, that's for sure. Now, 26, it seems like we're breaking out a little bit with the sales of 73.3 million, but 26 is a little bit of a maybe departure, which is a good thing. Important things, supply chain limitations, industry malaise affecting airspace industry post-pandemic. Yeah, yeah, the industry, to us, was kind of sleepwalking through those five years, you know, in a state of malaise. And it was a long five years, a long five years for us, that's for sure. You know, I think a lot of people didn't really believe in us very much. We believed in ourselves, but not too many people.

I think we were kind of forgotten company, that we were kind of lost, and we didn't know what to do.

And we never felt that way. We always stay focused. I think we work very hard in our quarters, that's for sure. I know that. I don't think it – we had to listen to people tell us to sell the company at $12 or $13 per share. You like that? That's the kind of crap you had to listen to. It was a long five years. And, you know, we're in the industry, so there's not much we can do about it, but the industry was, to us, sleepwalking. Now, we'll get to that in a little while, but, you know, I think that that's over, you know, So the industry has gotten a pretty serious wake-up call, maybe shock treatment. We always want to remind you how much fabric sales were in these years because they do drive the top line numbers and the bottom line as well. So I hope you don't mind that commentary. But, you know, we thought we're not complaining. We just thought you should know how we feel about things. You know, if you want to invest in parks, you know how we feel. Slide 22. Okay, so let's talk about this. This is interesting stuff. Our buyback authorization, yeah, we purchased 718,000 shares of our common stock, $12.94 per share, $9.2, $9.3 million. We didn't buy any stock in our Q4, Q1. I'm not shocked to hear that. So, you know, we used to comment that we really don't like buybacks so much, and we don't comment our stock price. We don't ask them to do that, except this is one exception. And we said, when the price gets so stupid, we don't have a choice but to buy the stock. So we thought the price was goddamn stupid, and we bought a lot of stock at $12.94. So let's go on to the next slide. We juxtaposed the two slides for, you know, potentially our recently announced public offering. That's slide 23. We announced this during the last word of call. We filed an industry registration statement and prospective supplement for $50 million at-to-market public offering. It was the purpose to replenish a portion of the $50 million plus. With that plus sign, we plan to invest in our major new manufacturing plant. We'll get back to that later. Other investments under serious consideration. We'll talk about that soon as well. To ensure, this is an important one, The park has a necessary funds to be in a position to take advantage of and exploit the key opportunities currently being presented to the park and the new key opportunities as they arise in the future. That's a little bit more of kind of an amorphous thing, but I think equally important. Now let's go to numbers. During our Q4, under this registration statement, we sold 943 approximately shares of common stock for proceeds of $22.8 million and a price of $24.21 per share. So we bought, let's see, we bought the stock at $12.94, we sold it at $12.421. Now, I'll tell you something, I don't have an MBA, I don't have a degree in economics, but where we come from, that's a pretty good deal, I think. So just wanted to mention those two numbers to you. Let's go on to slide 24. Here's the on the same kind of theme, Park's balance sheet cash in a very, very incredible in case of event history, is our opinion, of course. We have zero long-term debt, that's not our opinion. Park reported about 89.4 million in cash and markup securities at the end of the quarter. And you say, well, that's a lot for Park, and actually it's not.

I mean, it probably isn't even enough, we'll get to that in a later presentation.

We talk about the expansion plan and the other potential investments that we're seriously negotiating. It's probably not enough money for PARC. 41 consecutive years of dividends. PARC is paid $613.7 million, $29.975 per share since 2005. So our next dividend, which we're announcing soon, that will put us over $30 per share since 2005. We like to show the picture of our founders back in the park was founded in 1954 with about 30,000 bucks. A small, one of the back was a garage in Woodside, Queens. This actually is a step up. This is about three years later. This actually is a real factory in Flushing, New York, which I think was about 10,000 feet with our founders in the picture. Slide 25. I'll try to hustle. I know we're taking too much time here. So for those of you who have been listening to our presentations every quarter, we say We say the juggernaut is coming, it can't be stopped, and we better be ready. We're not saying that anymore. We're saying the juggernaut is here. Commercial aircraft juggernaut is now. So let's go through this quickly slide. This is 526. We show you this every quarter. I just want to remind you, the H320neo engine assumption per year, 1080, that's based upon a 60%. That's based upon 75 airplanes per year and 60% market share. But that market share, the actual market share, they get us 1,192 engines, not 1080. We're still sticking with 1080 to be conservative here. That's millions of dollars of additional revenue. Just want you to be aware of that. And slide 27 goes through a lot of the math as to how we computed the numbers on slide 26. We won't spend time on slide 27. Slide 28. Okay, so here we go. Now we need to spend some curious time on this whole new juggernaut extreme, we call it. Let's just go through some basics. Park's missile systems niche. Park specializes in the design and manufacture of advanced composite ablative materials used to produce solid rocker motor structures and heat shields for critical missile systems, including the Pax III Patriot missile system. We talk about that a lot, and we talk about it a lot during the presentation. I just want to flag here before I forget that there are dozens of missile systems that we work on. It's just that the Patriot has, you know, so much notoriety, so well-known, so we tend to focus on that more, just as an example. And the other programs you probably wouldn't want to talk about is to, you know, it's maybe not something for public consumption. But there are dozens of missile programs that we're on. FARC also designs and manufactures dancin composite structure materials, use to produce other missile system components. Depletion of the depleted. Okay, here we go. It's well understood that critical missile system stockpiles are already badly depleted by the ongoing brutal war in Europe in the last June's 12-day war in the Mideast. And now we have the war with the Iran. The shell game, what's a shell game? That means moving the factory batteries from one country to another, one country to another, to try to, you know, be ready for the incomings. The shell game has been tried. The law of the mission turns into play. There's only so many times the shells can be moved before there are no shells left to move.

That's the problem, you know.

That's really the problem. Slide 29. There is much reporting about how badly stockpiles of critical missile systems accrue in their Patriot, Pax Marine. The other systems report have been depleted as a result of the war with the RAND. We're not going to report it. Part of the reporting here is going to be responsible to do so. But you can check it out yourself. You can go find it yourself. We just don't want to go into that. Running empty, yeah, running empty. Replenishing the depleted stockpiles, well, that's obviously very urgent. There clearly is a highly urgent need to replenish the depleted missile system stockpiles. Is that enough? Does it end there? Maybe not. Quadrupling the production of the exquisite class of weapon systems. What? Quadrupling? Are you kidding me? I don't know. Maybe not. Let's go on the slide, what is it, 30? On March 29, 2026, I guess a couple months ago, President Trump met with the White House with six top defense contractors, including Lockheed and L3 Paris Missile Solutions. The reason we mentioned those two is they're both, you know, very key for us on the Pax 3 missile system. After immediate contracts, reportedly agreed to quadruple production of exquisite glass of weapon systems as rapidly as possible. Reportedly, not reported by President Trump, I think, actually, this is a new world order for the defense industry, a radical and likely lasting change of the defense industry. The old days are likely gone for the defense industry, and that is a good thing in our opinion. So, like I said, the industry generally has been sleepwalking for five years, defense and commercial. But there's now this wake-up call. We have the NWO, we have the extreme depletion of the supply, and then this quadrupling scenario, which is more than a wake-up call, more than an alarm clock. It's shock treatment. What does the NWO mean for PAR? So this is really important for you to understand. Our experience is that the defense industry has entered into hypersonic mode. That's our personal park experience, not just when we hear. That's our experience, our day-to-day experience. In all years, we have never seen anything like this, particularly for ablated materials, for solid rocket motors, not even close. I've been at parks since 1988. I've never seen anything like this, electronics or aerospace. The coating activity, especially for ablated materials for solid rocket missile systems, has been hyper and frenetic, almost too much to bear, really. It's something we've never seen before, and it's hard to really describe and help you understand what we're experiencing. We're just trying to do the best we can here. And just in case it's not obvious, the PAC-3 missile systems and many other missile systems, which Park supports are very key members of that quote-unquote exquisite class of weapon systems. So let's keep going here. Missile systems on slide 31. We're now talking about specifically the PAC-3 Patriot missile system. Park is sole source qualified for advanced composite plate and materials for solid rocket motors for the PAC-3 missile system program. The PAC-3 missile system is considered by many to be the world's premier missile defense system. So, you know, a lot of discussion about maybe it's not great for shooting down low drones, but for incoming ballistic missiles, yeah, that's the system everyone wants to have. Highly effective, highly effective. We have covered the Pact-3 missile system extensively in recent quarterly investor presentations. We'll just hit the high points of new items here. Stockpiles of the pack-free missile system interceptors were already badly depleted by the war in Europe and last June was a 12-day minish war. We don't want to go into repeating reporting here because it may not be appropriate and responsible to do so, but suffice to say the current war that ran is very badly depleted, the already depleted stockpile of pack-free interceptors. The pack-free missile system interceptors have been extensively and very effectively, maybe too effectively, meaning so effective that everybody in the world wants them, used by U.S. allies in the region, the Mideast region during this war, including Saudi Arabia, UAE, Kuwait, Qatar, Iran, Israel, defend against incomings during this Iranian war. Slide 32, just a little side note here. Israel, you probably know, also uses its own system called Arrow 304 at perj of missile defense, and PARC is qualified and supports both those programs. Back to the PAC-3 as previously reported, on January 26, Lockheed announced it reached a seven-year agreement with the Department of War to increase PAC-3 MSC interceptor production from 600 to 2,000. That's a lot. That's almost four, isn't it, 4X? What about us? What have we been told by our customer? We're not going to tell you. We're not living to, but we can tell you it's more than 2,000. On January 13, 2026, I think we covered this last time as well, the Dow announced that they're investing a billion dollars in the Elfman Harris solid rock and mortar business to boost solid rock and mortar production for PAC-3 and other missile systems. That transaction is already closed, apparently. Slide 33, continuing with missile systems. Airing Group, we've got to talk about Airing Group now. We've got to talk about Pac-3, now we've got to talk about Airing Group. So Airing Group is a joint venture.

It's a large company between Airbus and Safran.

Our relationship with Airing Group and its predecessors goes back to early 2000s. We have a very special relationship with Airing, and we're proud to be their partner. And we don't take liberties that you're a partner. That's their turn. and we don't do that. That's a term they use for us. I just want you to be aware of that. The air group produces a proprietary product called Raycarb G2B, which is, sorry, proprietary fabric Raycarb G2B, which is used to produce a plate of composite materials for the solid rocket missile programs. So here's something highlighted. Parker Solskjaer qualified on a solid rocket motor for the factory missile program, but specialty plate of materials produced with Arian Group's proprietary C2B fabric. So we're kind of double sole source qualified. We're sole source, but also Arian Group with the C2B fabric sole source. PARC entered into a business partner agreement with Arian in January of 22, under which they appointed us as their exclusive North American distributor for C2B fabric. On March, this is something worth noting. In March of 25, we entered into what they called the new agreement with Arian under which Park agreed to advance Arian $4,587,000 to Arian, that's about $5 million, I guess, against payments for future purchases by Park and C2B Fabric. Why did we do that? Slide 34. Yeah, we paid the first installment, you know, in Q1 of 26, we did a second installment in Q1 of 27, and third installment we paid, I'll turn last, I think, in Q1 of 28. What's the purpose of this big advance is, you know, approximately $5 million to fund 50-50 with Arian, the construction of additional C2B fabric manufacturing capacity in France. Will this capacity, that capacity will be aligned maybe, I think, in 28? Will this additional capacity be adequate to support the ramp-up of the, Just the Pact-3 missile programs, let's not even talk about the other programs in which C2B is being qualified or is qualified. The answer is no, not even close. Not even close. So what do we do now? PARC is engaged in serious discussions with the area group leading to an agreement to significantly increase C2B manufacturing, fabric manufacturing fast in the U.S. to support critical Department of War and Missile programs, including the factory and missile programs. The Greenville negotiation contemplates this important part of making a significant investment in this C2B fabric manufacturing plant, where I mentioned our own expansion, and there's another investment here. We'll get to our own expansion in a minute. In our opinion, it's urgent that this C2B fabric manufacturing plant is built. So, the interest in C2B is hyper and frenetic, so there are a lot of companies, a lot of customers, a lot of OEMs looking to sign up for C2B on their programs. The obvious challenge is the supply, you know, it will probably take about four years for this plant to be built. What have we got going here? We've got the NWO, we have the war, where systems have been badly depleted, and quadrupleings. That's driving a very, very, very hyper need for this C2B fabric, which is, like I said, considered the, you know, my understanding, the premier product for missile systems for solid rocket motors for missile systems. Let's go on to slide 35. This will tie together a little bit as well. Now, our new manufacturing plant, sorry we're going so long here, an update. We talked about this for the last couple of quarters, but, you know, we're regrouping with our new manufacturing plant. Why is that? We're planning, okay, let's go through it. Clark is planning to build a major new manufacturing plant. New plant will include the following manufacturing lines. This is going to review solution, solution creating hot melt film, hot melt tape, what else? Why else? Because we're always looking to expand and develop our business. We don't want to limit ourselves all at least what we're doing now. New plans that are being designed to produce and support our complete composite materials pipeline, including special inflated materials, solid rocket motors, film adhesive materials, and lightning strike protection materials. What else? Well, again, you know, we're looking always to develop into new areas, I mean, new related areas, not looking to go into making music park, you know, merry-go-round or something like that. What has changed from the original plant design discussed just in our Q3 in January? So hotmail, let's break it down. Is hotmail film and tape manufacturing capacity contemplated by the original plant adequately? Yeah, it probably is actually. Let's go on to slide 36. The hot metal film and tape lines primarily support Park's commercial aircraft programs, the commercial aircraft juggernaut, so we think we're okay with the commercial aircraft juggernaut. How about the solution-treating capacity, though, contemplated by the original plant design? Is it adequate? No, it's not adequate. The current plant design contemplates the current. Now, I'm not talking about the original plant design from three and four months ago. So the current plant design, the one we're working with now, contemplates additional solution-treating capacity, but it still may not be enough. And we're evaluating increasing solution-treating capacity even further. Why is that? The solution-treating line support, among other things, parks and missile system programs. Yep, the missile system's juggernaut. You see the connection here? The original plant design, conflated plant design of 120,000 square feet, will that be enough? Probably not. Because, again, we're looking at increasing the solution-treating capacity to support the missile systems juggernaut. So 120,000 square feet may not be enough. This is all coming at us pretty recently, so like I said, we're regrouping. We didn't know that there would be another war in Iran. We didn't know that President Trump would bring these guys in and say, you know, we've got a new world order here, a new sheriff in town. You increased your missile production by four times. We didn't know that was coming. So we're trying to regroup and make the adjustments that are good for park for the future. How much land are we looking for? This is important. We're looking for 20 acres. Why is that? Because the original plant, even with, let's say, expanded footprint, let's say it's a little bit more, it's 120,000. That would fit within 10 acres very nicely. But we're looking for 20 acres because we want to have the ability to add another plant of approximately the same size that's going to go in the future. It's important for us that the plants are in the same camp as, you know, we want a second plant across town.

It doesn't work too well for us.

So we want to have that ability to expand. That's why we're – our stack is approximately 20 acres. It doesn't have to be exactly – that's the concept anyway. Slide 37. Will the new plant still approximately double parks current composite materials manufacturing capacity? No, a little more than double parks current solution treating manufacturing capacity. Will the capital budget for new plants still be approximately $50 million? I don't think so. No, it's going to be more than that. And I should say something, you know, this is the capital budget, what about working capital? You know, start costs, it's significant, we're not even talking about that, going back to a cash number of $90 million approximately, plus the amount where it's, you know, seriously negotiating investing with the area plant in the U.S., when you add those two things together, you say, yeah, we don't, I don't have enough, I don't have enough money, likely be more. Where will the new plant site be located? In the U.S. heartland at a location which is supportive of, conducive to, and inspirational for, of course, future development and growth as a company. So we're not just looking at it from a mundane perspective. We just need this many machines to make this much product. You know, it's about our future. We're going to go for our future. The next, we build a plant. We'll be there for 30 years. You've got to think 30 years out. Slide 38. Sorry, it's taking us so long, folks. We're building this new manufacturing plant. Why are we doing it? Because our commercial aircraft juggernaut and missile system juggernaut is really required. That's just basic math. You know, we need the capacity to support those juggernauts. Also, though, to enable, this is a more futuristic, they can enable, facilitate, inspire parks' holistic growth and development as a company for the future. After all, we're only 72 years young. So thank you, everybody, for hanging in there. Operator, we're done with the presentation.

We'll be happy to answer any questions that investors may have at this point.

Thank you. And with that, we will indeed be conducting a question and answer session. As a reminder, if you'd like to ask a question, please press star 1 on your telephone keypad. The confirmation tone will indicate that your line is in question queue. You may press star 2 to remove yourself from the queue. And for any participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment while we pull for questions. And our first question comes from the line of Nick Ripostella. with NR Management. Please see me with your question.

Hey, can you hear me?

Yeah, we can hear you fine, Nick. How are you doing?

Great. Good afternoon. It's nice to hear you all and that everything's moving along. Okay, I just wanted to, I've been thinking about this one for a while. On the C2B fabric, is there any alternative that's used in any missile programs that you know of? That's a complicated question.

Okay, let's deal with that. That's a complicated question. There are stockpiles of two different types of fabric which are available, but they're not in production anymore, and there's no plan to put in back production. So, interesting, since you brought up. This is my perspective on it, but not only mine. And until a couple months ago, I think some of the defense contractors were kind of counting on using those stockpiles. Oh, we've got a long stockpile last for many, many years. But when you take everything multiplied by four, they start to panic. Like, these stockpiles are not going to last very long at all. And that probably is one of the reasons that there's kind of a hyper-interest in C2B. Now, there always are going to be efforts to develop new products that would maybe be, you know, would be, let's say, equivalent to C2B or could serve the same purpose that C2B serves. But what's existing in the market now, there are that are at the level of C2B. There are other later products that are not at the level of C2B in terms of capability. There are two products that are kind of close, but they're stockpiles that are being depleted and limited. So it's important. It's an interesting question, and the answer is, you know, maybe a little more complicated.

Okay. So do you consider that a risk? I mean, you know, necessity is the mother of invention, you know.

New products will be developed? Yeah, sure. It's a risk, but, of course, we would like to be involved, you know, and that's our attitude. We don't – I don't want to say too much more about it, actually, Nick, but, yeah, we're not sitting back passively and saying, okay, so, I mean, we want to be the driver of new products as well. And at the same time, supporting everything we're doing with Ari and our partner, you know, we never undermine them or do anything to hurt them. We would not do that.

Okay. So, by the way, so all the manufacturing, you know, what area, they have plants in France. So is that where tariffs would hit if there were any, you know, like, you know, kind of product like that? Or are you shielded from that somewhat?

Would tariffs apply to the product that's been shipped?

In other words, yeah, yeah.

Yeah. Well, I think the answer would be yes. I mean, you know, I think it's pretty obvious the answer is yes. Now, the tariff situation is changing, of course, and dynamic, but, you know, tariffs did apply to products that are being imported from France.

Well, it's just – I find it interesting, you know, that the, you know, Department of War wants to, you know, quadruple – you know, the material is important, and it would seem like, you know, they're shooting themselves in the foot by tariffing something.

Yeah, sorry to interrupt. That's an interesting point. It's been brought up by us, I mean to the Department of War.

Okay, so is it fair to say that the missile programs, you know, throughout the world that, you know, are using, mostly using C2B or is that an incorrect statement?

Missile programs. Other programs? Yeah. So, as to other missile programs, oh, there's many different kind of missiles and many different kind of ablated materials. I see. CTP is considered to be, you know, my opinion, but not only my opinion, premier material, ablative material, fabric for stop-rocket motors.

Okay. Fair enough. I'm sorry. able to, you know, you can stop me if I'm going too much, but I've asked this before, and you already have a lot on your plate, but is there any content or work developing on anything with SpaceX or Blue Origin or others?

So we, yeah, Mark, if you want to chime in, that's fine. I think we do a little bit of work with Blue Origin. My opinion is we'd love to do work with SpaceX. They're not solid rocket motor people. solid rocket motors are for defense, they're one-shots. You can't reuse a solid rocket motor. So when you think about SpaceX, they're big into reusing their rocket systems. They have a whole different kind of psychology about it. My opinion, when we talk about it, I love to be able to work with SpaceX. I'm not sure we're doing very much. Mark, Blue Origin, I think we're doing a little bit of Blue Origin, aren't we?

Yeah, we're doing a little bit. But I think most of that works in our parts business, right, our structure business. But we've been supplying some material. So lately it's been we've been building some parts for them.

Good. Okay, fair enough. And one other thing. So are we expecting to do additional, you know, aftermarket stock sales? You know, maybe do you need to raise more capital?

Yeah. So it was a $50 million ATM. I think we explained how much we raised so far. And it was only in our Q4, you know, as we explained. We haven't raised any since the end of Q4. So the balance is still available, and we'll see. Well, I think we try to be very intelligent and very disciplined about the ATM. We said no a lot. In other words, you know, unpricing. So no, no, it's not going to work for us. You know, we're trying to protect our existing shareholders. And I think we did, you know, quite an outstanding job of that, if you don't mind my saying so, Nick. We were quite disciplined, and, you know, we've got to offer it. No, no, that's not going to work for us. So we want to be careful about how we do it, and I think we're quite disciplined, like I said. And I think it worked out fine. I was very happy with the results. And, yeah, we'd like to raise some more money. We'll have to see what happens.

Well, I'll tell you how I feel.

We'll look at you every quarter, though. Just, you know, so go ahead. What are you about to say, Nick? We know how you feel.

You know how I feel you've done, yes, an excellent job of caring for shareholders. There's no question about that. And just one little other thing here. You know, you've been in this business for a long time, as you said. So, you know, the new facilities you're building, you know, are they much different? I know you highlighted some things in the call, but in terms of the technology, you know, Because, I don't know, at some point in the last couple of years, you've talked about automation and things like that. I'm just curious, because there is a lot going on in terms of, you know, extensive robotics and things like that, but maybe you're just not the type of process that, you know, could avail yourself of those things. But I'm just curious about your role.

Yeah, so we want to use those things as tools intelligently. You know, we don't want to go into automation because it's going to go cool, you know, so we could show people in the factory, look how automated it is. Automation is complicated, you know, and it's probably meant multiple edge to that sword. We talked about this internally, but it's, you know, an important point. Often automation is really good if you want to do the same exact thing every time because machines are going to not make the mistakes people make, But if your kind of culture is about flexibility, response, and this urgency, change things quickly, that's not really what automation is best at. That's what people are best at. So that's why I say, yeah, we want to use automation, but we want to be intelligent about it. We want to take it through where would we like to use automation, and where can it be helpful to us.

I hear you. I guess I'm just on one of those modes where I watch too many videos of, you know, aircraft engines being built and autos, you know, I find them fascinating, so I want to, you know, just thought I'd, it's amazing, the things that are, you know, people don't realize how complex it is, particularly on aircraft engines, but anyway, but all right, thank you for your time, and I just have to say, you know, there's an old Bruce Springsteen song from Small Things Mama, big things one day come and that is Park thank you very much I've looked that one up

I'm not familiar with that one but I'll go check it out thank you very much thank you so much you take care go ahead I was just going to say as a reminder if there are any more questions you can just press star 1 to get yourself Thank you. Okay. It looks like there are no further questions at this time, so I'd like to turn the floor back to Brian Shore for closing remarks.

Thank you, Opera, and thank all of you for listening and being patient with us. You know, we went on really long. I appreciate you taking the time to listen. And so I guess the beginning of summer, have a wonderful summer. We'll talk to you again pretty soon, I guess, kind of mid-July when we announce our Q1. And, of course, if you have any questions, any follow-up questions, feel free to go to the call any time. Have a great day.

Thank you. And with that, ladies and gentlemen, this does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time, and have a wonderful rest of your day.