UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 21, 2004
CIRCOR INTERNATIONAL, INC.
(Exact name of registrant as specified in charter)
| DELAWARE |
001-14962 |
04-3477276 | ||
| (State or other jurisdiction of incorporation) | (Commission file number) | (IRS employer identification no.) |
C/O CIRCOR, INC.
25 CORPORATE DRIVE, SUITE 130
BURLINGTON, MASSACHUSETTS 01803-4238
(Address of principal executive offices) (Zip Code)
(781) 270-1200
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition
On October 21, 2004, Circor International Inc. announced its financial results for the fiscal quarter ended September 26, 2004. The full text of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.
The information in this form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934 ( the “Exchange Act”) or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by special reference in such filing.
In the press release and accompanying supplemental information, the Company uses the following non-GAAP financial measures: free cash flow, EBIT, EBITDA, and earnings per share excluding special charges. Management of the Company believes that free cash flow (defined as net cash flow from operating activities, less capital expenditures and dividends paid) is an important measure of its liquidity as well as its ability to service long-term debt, fund future growth and to provide a return to shareholders. EBIT (defined as operating income plus other (income) expense, net), EBITDA (defined as operating income plus other (income) expense, net plus depreciation plus amortization) and earnings per share excluding special chares (defined as earnings per common share, excluding the impact of special charges, net of tax) is provided because management believes these measurements are commonly used by investors and financial institutions to analyze and compare companies on the basis of operating performance. Free cash flow, EBIT, EBITDA, and earnings per share excluding special charges are not measurements for financial performance under GAAP and should not be construed as a substitute for cash flows, operating income, net income or earnings per share. Free cash flow, EBIT, EBITDA, and earnings per share excluding special charges, as we have calculated here, may not necessarily be comparable to similarly titled measures used by other companies. A reconciliation of free cash flow, EBIT, EBITDA, and earnings per share excluding special charges, to the most directly comparable GAAP financial measure is provided in the supplemental information table titled “Reconciliation of Key Performance Measures to Commonly Used Generally Accepted Accounting Principle Terms.”
Item 9.01. Financial Statements and Exhibits
| Exhibit No. | Description | |
| 99.1 | Press Release Dated October 21, 2004 |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| CIRCOR INTERNATIONAL, INC. | ||
| Date: October 21, 2004 | /S/ Kenneth W. Smith | |
| By: Kenneth W. Smith Vice President, Chief Financial Officer and Treasurer | ||
3
Exhibit Index
| Exhibit No. |
Description | |
| 99.1 | Press release dated October 21, 2004 | |
4
Exhibit 99.1
PRESS RELEASE
| Contact: | Kenneth W. Smith | |
| Chief Financial Officer | ||
| CIRCOR International, Inc. | ||
| (781) 270-1200 |
CIRCOR Posts Third Quarter Earnings of $0.21 per share
| · | Orders increase 11% and backlog rises 22% to record $100 million |
| · | Lower project shipments and one-time costs impact third quarter results |
Burlington, MA, October 21, 2004
CIRCOR International, Inc. (NYSE: CIR), a leading provider of valves and fluid control products for the instrumentation, fluid regulation and petrochemical markets, announced today results for the third quarter ended September 26, 2004. Net income for the third quarter of 2004 was $3.3 million, or $0.21 per diluted share, compared to $4.4 million, or $0.28 per diluted share, for the 2003 third quarter. Revenues for the 2004 third quarter were $89.8 million, an increase of 4% from $86.7 million for the third quarter 2003.
For the nine months ended September 26, 2004, net income was $11.7 million or $0.73 per diluted share. Net income for the nine months ended September 28, 2003, totaled $12.6 million or $0.81 per diluted share. Revenues for the first nine months of 2004 were $275.0 million, an increase of 5% from $263.0 million for the first nine months of 2003.
During the quarter, the Company generated $4.2 million of free cash flow (defined as net cash from operating activities, less capital expenditures and dividends paid) and, for the first nine months of 2004, the Company generated $12.7 million of free cash flow. At the end of the quarter the Company remained in a positive net cash position (cash, cash equivalents, and investments less total debt).
The Company indicated that its third quarter results were in line with its expectations and revised guidance issued on September 13, 2004. The Company’s Chairman and Chief Executive Officer, Mr. David A. Bloss, Sr., commented, “While business conditions improved slightly compared to last year, higher raw material costs and other factors lowered our profitability. Price increases have been implemented in most businesses to help offset the continuing rise in stainless steel costs. In addition, this quarter we experienced adverse weather affecting our Tampa, Florida operation. Although our facility was unharmed, a number of our employees missed work to attend to their residences and freight services used for shipping and receiving were disrupted during the recent storms. We also recorded other one-time costs this quarter including a write-down of a building currently held for sale and the write-off of fixed assets related to a product line that was relocated.”
CIRCOR’s Petrochemical Product segment revenues decreased 7% to $36.8 million from $39.5 million in the third quarter of last year due to the timing of project shipments this quarter which overshadowed the benefits from the acquisition of Mallard Control in April 2004. Incoming orders for the quarter were up 19% compared to the third quarter 2003. Backlog increased 34% compared to September 28, 2003, and increased 9% since June 27, 2004. Mr. Bloss indicated that the high level of incoming orders and record level backlog this quarter indicates that international oil and gas project activity remains healthy. He further stated, “This segment’s operating margin of 7.8% for the third quarter 2004 excluding special charges remained essentially unchanged sequentially despite higher metals costs and lower third quarter international project shipment volume, both of which masked profitability improvements in our North American operations. Shipments for international projects tend to be rather erratic depending upon the contractors’ delivery schedule for the individual projects in our backlog.”
CIRCOR’s Instrumentation and Thermal Fluid Controls Products segment revenues were up 13% to $53.0 million for the third quarter compared to $47.1 million for the same period last year and up 8% on a nine-month year-to-date basis. Incoming orders for this segment were up 6% compared to the third quarter last year, and backlog at quarter-end also increased 8% versus last year. Order levels benefited from two acquisitions made in the fourth quarter of 2003, both serving analytical sampling applications. Operating margin for this segment was 10.9% during the third quarter 2004, compared to 11.9% last year.
CIRCOR’s guidance for its fourth quarter is $0.28 to $0.32 per share excluding special charges. Mr. Bloss stated, “We expect that higher project-related shipment volume, improved profitability from pricing actions and higher efficiencies will increase the Company’s performance for the fourth quarter compared to our third quarter results. However, we have lowered our previous guidance for the fourth quarter due to the continuing higher steel costs and higher compliance costs for Sarbanes-Oxley 404.”
Bloss further added some thoughts on the Company’s ongoing inventory reduction efforts. According to Bloss, “In 2003, Circor made substantial progress in its program of inventory reduction, which freed up significant amounts of working capital by reducing both active and excess inventories. This program continues throughout 2004. In conjunction with our next quarterly review of the market value of our excess inventory, we will determine whether a more aggressive market value adjustment is necessary in order to allow us to expedite the sale and disposal of our remaining slow moving inventory. This determination will be made in the fourth quarter and could result in a non-cash charge to earnings that is not included the fourth quarter guidance above.”
CIRCOR International has scheduled a conference call to review its results for the third quarter 2004 on Friday, October 22, 2004, at 9:00am ET. Interested parties may access the call by dialing (800) 406-5356 or (913) 981-5572. A replay of the call will be available from noon ET on October 22, 2004 through midnight on October 28, 2004. To access the replay, interested parties should dial (888) 203-1112 or (719) 457-0820 and enter confirmation code #981226 when prompted. The presentation slides that will be discussed in the conference call are expected to be available on Thursday, October 21, 2004, by 6:00pm ET. The presentation slides may be downloaded from the quarterly earnings page
of the investor section on the CIRCOR website: http://www.CIRCOR.com. An audio recording of the conference call also is expected to be posted on the company’s website by October 26, 2004.
CIRCOR International, Inc. is a leading provider of valves and fluid control products that allow customers around the world to use fluids safely and efficiently in the instrumentation, thermal fluid regulation and petrochemical markets. CIRCOR’s executive headquarters are located at 25 Corporate Drive, Burlington, MA 01803.
This press release contains certain statements that are “forward-looking statements” as that term is defined under the Private Securities Litigation Reform Act of 1995 (the “Act”) and releases issued by the Securities and Exchange Commission (SEC). The words “may,” “hope,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” “continue,” and other expressions which are predictions of or indicate future events and trends and which do not relate to historical matters identify forward-looking statements. We believe that it is important to communicate our future expectations to our stockholders, and we, therefore, make forward-looking statements in reliance upon the safe harbor provisions of the Act. However, there may be events in the future that we are not able to accurately predict or control, and our actual results, performance or achievements may differ materially from the expectations we describe in our forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the cyclicality and highly competitive nature of some of our end markets, changes in the price of and demand for oil and gas in both domestic and international markets, variability of raw material and component pricing, fluctuations in foreign currency exchange rates, and our ability to continue operating our manufacturing facilities at efficient levels and to successfully implement our acquisition strategy. We advise you to read further about these and other risk factors set forth under the caption “Certain Risk Factors That May Affect Future Results” in our SEC filings. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
CIRCOR INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
UNAUDITED
| September 26, 2004 |
December 31, 2003 | |||||
| ASSETS | ||||||
| Current Assets: |
||||||
| Cash and cash equivalents |
$ | 60,055 | $ | 58,202 | ||
| Investments |
7,953 | 7,840 | ||||
| Trade accounts receivable, less allowance for doubtful accounts of $2,436 and $2,119, respectively |
60,473 | 64,830 | ||||
| Inventories |
112,679 | 97,278 | ||||
| Prepaid expenses and other current assets |
3,904 | 4,587 | ||||
| Deferred income taxes |
6,493 | 6,303 | ||||
| Assets held for sale |
952 | 3,884 | ||||
| Total Current Assets |
252,509 | 242,924 | ||||
| Property, Plant and Equipment, net |
58,888 | 61,737 | ||||
| Other Assets: |
||||||
| Goodwill |
118,162 | 111,448 | ||||
| Intangibles, net |
1,549 | 1,587 | ||||
| Other assets |
6,085 | 6,167 | ||||
| Total Assets |
$ | 437,193 | $ | 423,863 | ||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
| Current Liabilities: |
||||||
| Accounts payable |
$ | 37,487 | $ | 37,635 | ||
| Accrued expenses and other current liabilities |
30,731 | 27,742 | ||||
| Income taxes payable |
2,890 | 1,491 | ||||
| Notes payable and current portion of long-term debt |
15,249 | 17,268 | ||||
| Total Current Liabilities |
86,357 | 84,136 | ||||
| Long-term Debt, net of current portion |
42,841 | 43,791 | ||||
| Deferred Income Taxes |
6,625 | 6,303 | ||||
| Other Noncurrent Liabilities |
10,967 | 9,820 | ||||
| Minority Interest |
4,615 | 4,653 | ||||
| Shareholders’ Equity: |
||||||
| Preferred stock, $.01 par value; 1,000,000 shares authorized; no shares issued and outstanding |
— | — | ||||
| Common stock, $.01 par value; 29,000,000 shares authorized; and 15,417,049 and 15,302,127 issued and outstanding, respectively |
154 | 153 | ||||
| Additional paid-in capital |
208,044 | 206,160 | ||||
| Retained earnings |
64,741 | 54,793 | ||||
| Accumulated other comprehensive income |
12,849 | 14,054 | ||||
| Total Shareholders’ Equity |
285,788 | 275,160 | ||||
| Total Liabilities and Shareholders’ Equity |
$ | 437,193 | $ | 423,863 | ||
CIRCOR INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
UNAUDITED
| Three Months Ended |
Nine Months Ended |
|||||||||||||||
| September 26, 2004 |
September 28, 2003 |
September 26, 2004 |
September 28, 2003 |
|||||||||||||
| Net revenues |
$ | 89,760 | $ | 86,661 | $ | 275,009 | $ | 263,048 | ||||||||
| Cost of revenues |
63,091 | 61,801 | 192,373 | 186,445 | ||||||||||||
| GROSS PROFIT |
26,669 | 24,860 | 82,636 | 76,603 | ||||||||||||
| Selling, general and administrative expenses |
20,591 | 16,788 | 61,673 | 53,545 | ||||||||||||
| Special charges |
265 | 271 | 303 | 271 | ||||||||||||
| OPERATING INCOME |
5,813 | 7,801 | 20,660 | 22,787 | ||||||||||||
| Other (income) expense: |
||||||||||||||||
| Interest income |
(181 | ) | (192 | ) | (536 | ) | (495 | ) | ||||||||
| Interest expense |
1,182 | 1,512 | 3,529 | 4,625 | ||||||||||||
| Other income, net |
(241 | ) | (362 | ) | (291 | ) | (1,054 | ) | ||||||||
| Total other expense |
760 | 958 | 2,702 | 3,076 | ||||||||||||
| INCOME BEFORE INCOME TAXES |
5,053 | 6,843 | 17,958 | 19,711 | ||||||||||||
| Provision for income taxes |
1,770 | 2,464 | 6,285 | 7,096 | ||||||||||||
| NET INCOME |
$ | 3,283 | $ | 4,379 | $ | 11,673 | $ | 12,615 | ||||||||
| Earnings per common share: |
||||||||||||||||
| Basic |
$ | 0.21 | $ | 0.29 | $ | 0.76 | $ | 0.83 | ||||||||
| Diluted |
$ | 0.21 | $ | 0.28 | $ | 0.73 | $ | 0.81 | ||||||||
| Weighted average common shares outstanding: |
||||||||||||||||
| Basic |
15,371 | 15,237 | 15,338 | 15,177 | ||||||||||||
| Diluted |
15,825 | 15,812 | 15,885 | 15,620 | ||||||||||||
CIRCOR INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
UNAUDITED
| Nine Months Ended |
||||||||
| September 26, 2004 |
September 28, 2003 |
|||||||
| OPERATING ACTIVITIES | ||||||||
| Net income |
$ | 11,673 | $ | 12,615 | ||||
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
||||||||
| Depreciation |
7,561 | 7,511 | ||||||
| Amortization |
153 | 223 | ||||||
| Compensation expense of stock-based plans |
461 | 203 | ||||||
| Loss on disposal of property, plant and equipment |
191 | 43 | ||||||
| Loss on write-down of property, plant and equipment |
— | 30 | ||||||
| Loss on write-down of assets held for sale |
238 | — | ||||||
| Gain on sale of assets held for sale |
(387 | ) | — | |||||
| Gain on sale of marketable securities |
— | (64 | ) | |||||
| Equity in undistributed earnings of affiliates |
(86 | ) | — | |||||
| Changes in operating assets and liabilities, net of effects from business acquisitions: |
||||||||
| Trade accounts receivable |
6,172 | (3,773 | ) | |||||
| Inventories |
(12,092 | ) | 15,758 | |||||
| Prepaid expenses and other assets |
(524 | ) | (192 | ) | ||||
| Accounts payable, accrued expenses and other liabilities |
4,698 | 7,720 | ||||||
| Net cash provided by operating activities |
18,058 | 40,074 | ||||||
| INVESTING ACTIVITIES | ||||||||
| Additions to property, plant and equipment |
(3,626 | ) | (5,793 | ) | ||||
| Proceeds from sale of property, plant and equipment |
821 | 38 | ||||||
| Proceeds from sale of assets held for sale |
3,030 | — | ||||||
| Business acquisitions, net of cash acquired |
(12,198 | ) | — | |||||
| Purchase of investments |
(1,456 | ) | — | |||||
| Proceeds from sale of investments |
1,456 | 4,128 | ||||||
| Other |
(1 | ) | (17 | ) | ||||
| Net cash used in investing activities |
(11,974 | ) | (1,644 | ) | ||||
| FINANCING ACTIVITIES | ||||||||
| Proceeds from long-term borrowings |
322 | 810 | ||||||
| Payments of long-term debt |
(3,559 | ) | (3,924 | ) | ||||
| Dividends paid |
(1,725 | ) | (1,706 | ) | ||||
| Proceeds from the exercise of stock options |
1,098 | 1,102 | ||||||
| Net cash used in financing activities |
(3,864 | ) | (3,718 | ) | ||||
| Effect of exchange rate changes on cash and cash equivalents |
(367 | ) | 1,753 | |||||
| INCREASE IN CASH AND CASH EQUIVALENTS |
1,853 | 36,465 | ||||||
| Cash and cash equivalents at beginning of year |
58,202 | 38,382 | ||||||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD |
$ | 60,055 | $ | 74,847 | ||||
CIRCOR INTERNATIONAL, INC.
SUMMARY OF ORDERS AND BACKLOG
(in thousands)
UNAUDITED
| Three Months Ended |
Nine Months Ended | |||||||||||
| September 26, 2004 |
September 28, 2003 |
September 26, 2004 |
September 28, 2003 | |||||||||
| ORDERS | ||||||||||||
| Instrumentation & Thermal Fluid Controls |
$ | 51,688 | $ | 48,682 | $ | 162,941 | $ | 148,739 | ||||
| Petrochemical |
41,755 | 35,139 | 123,228 | 121,836 | ||||||||
| Total orders |
$ | 93,443 | $ | 83,821 | $ | 286,169 | $ | 270,575 | ||||
| September 26, 2004 |
September 28, 2003 |
|||||||||||
| BACKLOG | ||||||||||||
| Instrumentation & Thermal Fluid Controls |
$ | 40,412 | $ | 37,524 | ||||||||
| Petrochemical |
59,732 | 44,718 | ||||||||||
| Total backlog |
$ | 100,144 | $ | 82,242 | ||||||||
Note: Backlog includes all unshipped customer orders.
CIRCOR INTERNATIONAL, INC.
SUMMARY REPORT BY SEGMENT
(in thousands, except earnings per share)
UNAUDITED
| 2003 |
2004 |
|||||||||||||||||||||||||||||||||||
| 1ST QTR |
2ND QTR |
3RD QTR |
4TH QTR |
YEAR |
1ST QTR |
2ND QTR |
3RD QTR |
YTD |
||||||||||||||||||||||||||||
| NET REVENUES |
||||||||||||||||||||||||||||||||||||
| Instrumentation & Thermal Fluid Controls (TFC) |
$ | 49,119 | $ | 50,963 | $ | 47,132 | $ | 53,561 | $ | 200,775 | $ | 51,639 | $ | 54,864 | $ | 52,966 | $ | 159,469 | ||||||||||||||||||
| Petrochemical |
38,044 | 38,261 | 39,529 | 42,844 | 158,678 | 39,058 | 39,688 | 36,794 | 115,540 | |||||||||||||||||||||||||||
| Total |
87,163 | 89,224 | 86,661 | 96,405 | 359,453 | 90,697 | 94,552 | 89,760 | 275,009 | |||||||||||||||||||||||||||
| OPERATING MARGIN |
||||||||||||||||||||||||||||||||||||
| Instrumentation & TFC |
12.2 | % | 12.5 | % | 11.9 | % | 9.5 | % | 11.5 | % | 11.2 | % | 11.4 | % | 10.9 | % | 11.2 | % | ||||||||||||||||||
| Petrochemical |
7.6 | % | 8.6 | % | 10.9 | % | 12.1 | % | 9.9 | % | 10.9 | % | 7.7 | % | 7.8 | % | 8.8 | % | ||||||||||||||||||
| Segment operating margin |
10.2 | % | 10.8 | % | 11.5 | % | 10.7 | % | 10.8 | % | 11.1 | % | 9.8 | % | 9.7 | % | 10.2 | % | ||||||||||||||||||
| Corporate expenses |
-1.9 | % | -2.1 | % | -2.1 | % | -2.1 | % | -2.1 | % | -2.5 | % | -2.3 | % | -2.9 | % | -2.6 | % | ||||||||||||||||||
| Special charges |
0.0 | % | 0.0 | % | -0.3 | % | -1.1 | % | -0.4 | % | 0.0 | % | 0.0 | % | -0.3 | % | -0.1 | % | ||||||||||||||||||
| Total operating margin |
8.2 | % | 8.7 | % | 9.0 | % | 7.5 | % | 8.3 | % | 8.5 | % | 7.5 | % | 6.5 | % | 7.5 | % | ||||||||||||||||||
| OPERATING INCOME |
||||||||||||||||||||||||||||||||||||
| Instrumentation & TFC (excl. special charges) |
5,982 | 6,359 | 5,622 | 5,110 | 23,073 | 5,776 | 6,239 | 5,786 | 17,801 | |||||||||||||||||||||||||||
| Petrochemical (excl. special charges) |
2,876 | 3,303 | 4,309 | 5,171 | 15,659 | 4,251 | 3,066 | 2,877 | 10,194 | |||||||||||||||||||||||||||
| Segment operating income (excl. special charges) |
8,858 | 9,662 | 9,931 | 10,281 | 38,732 | 10,027 | 9,305 | 8,663 | 27,995 | |||||||||||||||||||||||||||
| Corporate expenses |
(1,674 | ) | (1,860 | ) | (1,859 | ) | (1,989 | ) | (7,382 | ) | (2,259 | ) | (2,188 | ) | (2,585 | ) | (7,032 | ) | ||||||||||||||||||
| Special charges |
— | — | (271 | ) | (1,092 | ) | (1,363 | ) | (38 | ) | — | (265 | ) | (303 | ) | |||||||||||||||||||||
| Total operating income |
7,184 | 7,802 | 7,801 | 7,200 | 29,987 | 7,730 | 7,117 | 5,813 | 20,660 | |||||||||||||||||||||||||||
| INTEREST EXPENSE, NET |
(1,461 | ) | (1,349 | ) | (1,320 | ) | (1,021 | ) | (5,151 | ) | (1,020 | ) | (972 | ) | (1,001 | ) | (2,993 | ) | ||||||||||||||||||
| OTHER (EXPENSE) INCOME, NET |
275 | 417 | 362 | (217 | ) | 837 | (143 | ) | 193 | 241 | 291 | |||||||||||||||||||||||||
| PRETAX INCOME |
5,998 | 6,870 | 6,843 | 5,962 | 25,673 | 6,567 | 6,338 | 5,053 | 17,958 | |||||||||||||||||||||||||||
| PROVISION FOR INCOME TAXES |
(2,159 | ) | (2,473 | ) | (2,464 | ) | (704 | ) | (7,800 | ) | (2,299 | ) | (2,216 | ) | (1,770 | ) | (6,285 | ) | ||||||||||||||||||
| EFFECTIVE TAX RATE |
36.0 | % | 36.0 | % | 36.0 | % | 11.8 | % | 30.4 | % | 35.0 | % | 35.0 | % | 35.0 | % | 35.0 | % | ||||||||||||||||||
| NET INCOME |
$ | 3,839 | $ | 4,397 | $ | 4,379 | $ | 5,258 | $ | 17,873 | $ | 4,268 | $ | 4,122 | $ | 3,283 | $ | 11,673 | ||||||||||||||||||
| Weighted Average Common Shares Outstanding (Diluted) |
15,533 | 15,634 | 15,812 | 15,919 | 15,675 | 16,001 | 15,908 | 15,825 | 15,885 | |||||||||||||||||||||||||||
| EARNINGS PER COMMON SHARE (Diluted) |
$ | 0.25 | $ | 0.28 | $ | 0.28 | $ | 0.33 | $ | 1.14 | $ | 0.27 | $ | 0.26 | $ | 0.21 | $ | 0.73 | ||||||||||||||||||
| EARNINGS PER COMMON SHARE (Diluted) excluding special charges |
$ | 0.25 | $ | 0.28 | $ | 0.29 | $ | 0.37 | $ | 1.20 | $ | 0.27 | $ | 0.26 | $ | 0.22 | $ | 0.75 | ||||||||||||||||||
| EBIT |
$ | 7,459 | $ | 8,219 | $ | 8,163 | $ | 6,983 | $ | 30,824 | $ | 7,587 | $ | 7,310 | $ | 6,054 | $ | 20,951 | ||||||||||||||||||
| Depreciation |
2,470 | 2,563 | 2,478 | 2,053 | 9,564 | 2,680 | 2,353 | 2,528 | 7,561 | |||||||||||||||||||||||||||
| Amortization of intangibles |
74 | 75 | 74 | 75 | 298 | 77 | 38 | 38 | 153 | |||||||||||||||||||||||||||
| EBITDA |
$ | 10,003 | $ | 10,857 | $ | 10,715 | $ | 9,111 | $ | 40,686 | $ | 10,344 | $ | 9,701 | $ | 8,620 | $ | 28,665 | ||||||||||||||||||
| EBITDA AS A PERCENT OF SALES |
11.5 | % | 12.2 | % | 12.4 | % | 9.5 | % | 11.3 | % | 11.4 | % | 10.3 | % | 9.6 | % | 10.4 | % | ||||||||||||||||||
| CAPITAL EXPENDITURES |
$ | 795 | $ | 1,058 | $ | 3,940 | $ | 1,030 | $ | 6,823 | $ | 1,294 | $ | 1,575 | $ | 757 | $ | 3,626 | ||||||||||||||||||
CIRCOR INTERNATIONAL, INC.
RECONCILIATION OF KEY PERFORMANCE MEASURES TO COMMONLY USED
GENERALLY ACCEPTED ACCOUNTING PRINCIPLE TERMS
(in thousands)
UNAUDITED
| 2003 |
2004 |
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| 1ST QTR |
2ND QTR |
3RD QTR |
4TH QTR |
YEAR |
1ST QTR |
2ND QTR |
3RD QTR |
YTD |
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| FREE CASH FLOW [NET CASH FLOW FROM OPERATING ACTIVITIES LESS CAPITAL EXPENDITURES LESS DIVIDENDS PAID] |
$ | 14,533 | $ | 10,603 | $ | 7,439 | $ | 16,968 | $ | 49,543 | $ | 2,254 | $ | 6,265 | $ | 4,188 | $ | 12,707 | ||||||||||||||||||
| ADD: Capital expenditures |
795 | 1,058 | 3,940 | 1,030 | 6,823 | 1,294 | 1,575 | 757 | 3,626 | |||||||||||||||||||||||||||
| Dividends paid |
567 | 569 | 570 | 574 | 2,280 | 573 | 576 | 576 | 1,725 | |||||||||||||||||||||||||||
| NET CASH PROVIDED BY OPERATING ACTIVITIES |
$ | 15,895 | $ | 12,230 | $ | 11,949 | $ | 18,572 | $ | 58,646 | $ | 4,121 | $ | 8,416 | $ | 5,521 | $ | 18,058 | ||||||||||||||||||
| NET (CASH) DEBT [TOTAL DEBT LESS CASH AND CASH EQUIVALENTS LESS INVESTMENTS] |
$ | 20,209 | $ | 8,005 | $ | 254 | $ | (4,983 | ) | $ | (4,983 | ) | $ | (8,706 | ) | $ | (4,054 | ) | $ | (9,918 | ) | $ | (9,918 | ) | ||||||||||||
| ADD: Cash and cash equivalents |
51,419 | 65,017 | 74,847 | 58,202 | 58,202 | 59,963 | 54,527 | 60,055 | 60,055 | |||||||||||||||||||||||||||
| Investments |
4,072 | 1,464 | — | 7,840 | 7,840 | 7,679 | 7,517 | 7,953 | 7,953 | |||||||||||||||||||||||||||
| TOTAL DEBT |
$ | 75,700 | $ | 74,486 | $ | 75,101 | $ | 61,059 | $ | 61,059 | $ | 58,936 | $ | 57,990 | $ | 58,090 | $ | 58,090 | ||||||||||||||||||
| NET DEBT AS % OF NET CAPITALIZATION |
7.5 | % | 3.0 | % | 0.1 | % | -1.8 | % | -1.8 | % | -3.3 | % | -1.5 | % | -3.6 | % | -3.6 | % | ||||||||||||||||||
| NET (CASH) DEBT [As defined above] |
$ | 20,209 | $ | 8,005 | $ | 254 | $ | (4,983 | ) | $ | (4,983 | ) | $ | (8,706 | ) | $ | (4,054 | ) | $ | (9,918 | ) | $ | (9,918 | ) | ||||||||||||
| ADD: Cash and cash equivalents |
51,419 | 65,017 | 74,847 | 58,202 | 58,202 | 59,963 | 54,527 | 60,055 | 60,055 | |||||||||||||||||||||||||||
| Investments |
4,072 | 1,464 | — | 7,840 | 7,840 | 7,679 | 7,517 | 7,953 | 7,953 | |||||||||||||||||||||||||||
| TOTAL DEBT |
$ | 75,700 | $ | 74,486 | $ | 75,101 | $ | 61,059 | $ | 61,059 | $ | 58,936 | $ | 57,990 | $ | 58,090 | $ | 58,090 | ||||||||||||||||||
| NET CAPITALIZATION [TOTAL DEBT PLUS SHAREHOLDERS’ EQUITY LESS CASH AND CASH EQUIVALENTS, LESS INVESTMENTS] |
$ | 270,090 | $ | 266,529 | $ | 263,505 | $ | 270,177 | $ | 270,177 | $ | 267,728 | $ | 276,260 | $ | 275,870 | $ | 275,870 | ||||||||||||||||||
| LESS: Debt |
(75,700 | ) | (74,486 | ) | (75,101 | ) | (61,059 | ) | (61,059 | ) | (58,936 | ) | (57,990 | ) | (58,090 | ) | (58,090 | ) | ||||||||||||||||||
| ADD: Cash and cash equivalents |
51,419 | 65,017 | 74,847 | 58,202 | 58,202 | 59,963 | 54,527 | 60,055 | 60,055 | |||||||||||||||||||||||||||
| Investments |
4,072 | 1,464 | — | 7,840 | 7,840 | 7,679 | 7,517 | 7,953 | 7,953 | |||||||||||||||||||||||||||
| TOTAL SHAREHOLDERS’ EQUITY |
249,881 | 258,524 | 263,251 | 275,160 | 275,160 | 276,434 | 280,314 | 285,788 | 285,788 | |||||||||||||||||||||||||||
| ADD: TOTAL DEBT |
75,700 | 74,486 | 75,101 | 61,059 | 61,059 | 58,936 | 57,990 | 58,090 | 58,090 | |||||||||||||||||||||||||||
| TOTAL CAPITAL |
$ | 325,581 | $ | 333,010 | $ | 338,352 | $ | 336,219 | $ | 336,219 | $ | 335,370 | $ | 338,304 | $ | 343,878 | $ | 343,878 | ||||||||||||||||||
| TOTAL DEBT / TOTAL CAPITAL |
23.3 | % | 22.4 | % | 22.2 | % | 18.2 | % | 18.2 | % | 17.6 | % | 17.1 | % | 16.9 | % | 16.9 | % | ||||||||||||||||||
| EBIT [NET INCOME LESS INTEREST EXPENSE, NET] |
$ | 7,459 | $ | 8,219 | $ | 8,163 | $ | 6,983 | $ | 30,824 | $ | 7,587 | $ | 7,310 | $ | 6,054 | $ | 20,951 | ||||||||||||||||||
| LESS: Interest expense, net |
(1,461 | ) | (1,349 | ) | (1,320 | ) | (1,021 | ) | (5,151 | ) | (1,020 | ) | (972 | ) | (1,001 | ) | (2,993 | ) | ||||||||||||||||||
| Provision for income taxes |
(2,159 | ) | (2,473 | ) | (2,464 | ) | (704 | ) | (7,800 | ) | (2,299 | ) | (2,216 | ) | (1,770 | ) | (6,285 | ) | ||||||||||||||||||
| NET INCOME |
$ | 3,839 | $ | 4,397 | $ | 4,379 | $ | 5,258 | 17,873 | $ | 4,268 | $ | 4,122 | $ | 3,283 | $ | 11,673 | |||||||||||||||||||
| EBITDA [NET INCOME LESS INTEREST EXPENSE, NET LESS DEPRECIATION LESS AMORTIZATION LESS TAXES] |
$ | 10,003 | $ | 10,857 | $ | 10,715 | $ | 9,111 | $ | 40,686 | $ | 10,344 | $ | 9,701 | $ | 8,620 | $ | 28,665 | ||||||||||||||||||
| LESS: |
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| Interest expense, net |
(1,461 | ) | (1,349 | ) | (1,320 | ) | (1,021 | ) | (5,151 | ) | (1,020 | ) | (972 | ) | (1,001 | ) | (2,993 | ) | ||||||||||||||||||
| Depreciation |
(2,470 | ) | (2,563 | ) | (2,478 | ) | (2,053 | ) | (9,564 | ) | (2,680 | ) | (2,353 | ) | (2,528 | ) | (7,561 | ) | ||||||||||||||||||
| Amortization of intangibles |
(74 | ) | (75 | ) | (74 | ) | (75 | ) | (298 | ) | (77 | ) | (38 | ) | (38 | ) | (153 | ) | ||||||||||||||||||
| Provision for income taxes |
(2,159 | ) | (2,473 | ) | (2,464 | ) | (704 | ) | (7,800 | ) | (2,299 | ) | (2,216 | ) | (1,770 | ) | (6,285 | ) | ||||||||||||||||||
| NET INCOME |
$ | 3,839 | $ | 4,397 | $ | 4,379 | $ | 5,258 | $ | 17,873 | $ | 4,268 | $ | 4,122 | $ | 3,283 | $ | 11,673 | ||||||||||||||||||
| INCOME EXCLUDING SPECIAL CHARGES [NET INCOME LESS SPECIAL CHARGES, NET OF TAX] |
$ | 3,839 | $ | 4,397 | $ | 4,552 | $ | 5,957 | $ | 18,822 | $ | 4,293 | $ | 4,122 | $ | 3,455 | $ | 11,870 | ||||||||||||||||||
| LESS: Special charges, net of tax |
— | — | (173 | ) | (699 | ) | (949 | ) | (25 | ) | — | (172 | ) | (197 | ) | |||||||||||||||||||||
| NET INCOME |
$ | 3,839 | $ | 4,397 | $ | 4,379 | $ | 5,258 | $ | 17,873 | $ | 4,268 | $ | 4,122 | $ | 3,283 | $ | 11,673 | ||||||||||||||||||