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United States securities and exchange commission logo
September 14, 2022
Arjun Sharma
Chief Financial Officer
CIRCOR International, Inc.
30 Corporate Drive, Suite 200
Burlington, MA 01803-4238
Re: CIRCOR
International, Inc.
Form 10-K for the
Year Ended December 31, 2021
Form 8-K furnished
August 11, 2022
File No. 001-14962
Dear Mr. Sharma:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments. In some of our comments, we
may ask you to
provide us with information so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for the Year Ended December 31, 2021
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations
2021 Compared With 2020
Industrial Segment, page 26
1. We note your
presentation on pages 26 and 31 of Net Revenues, Segment Operating
Income and Segment
Operation Margin "excluding divestiture." As the divested
operations did not meet
the criteria for being presented as discontinued operations
pursuant to ASC 205-20,
please clarify how these non-GAAP measures do not represent
individually tailored
accounting measures per Question 100.04 of the Non-GAAP
Compliance and
Disclosure Interpretations. Also apply this comment to various non-
GAAP measures excluding
Pipeline Engineering in your earnings releases on Form 8-K.
Arjun Sharma
FirstName LastNameArjun
CIRCOR International, Inc. Sharma
Comapany 14,
September NameCIRCOR
2022 International, Inc.
September
Page 2 14, 2022 Page 2
FirstName LastName
Financial Statements
Notes to Consolidated Financial Statements
(2) Restatement of Previously Issued Consolidated Financial Statements, page
103
2. We note from your Item 4.02 Form 8-K furnished on March 14, 2022 that
the "accounting
irregularities" leading to your restatement involved "a period of at
least five years" and
impacted the fiscal 2018 and 2019 financial statements. However, we
note from
your restatement footnotes within your Form 10-K that you do not
appear to quantify the
impact of the errors for every quarterly and annual financial
statement that should no
longer be relied upon. Please clearly indicate all specific financial
statements that should
no longer be relied upon and provide us with detailed information
regarding the
quantitative impacts of the errors for each applicable historical
annual and quarterly
financial statement not currently reflected in footnotes 2 and 23.
3. Please explain your basis for restating prior period financial
statements in the 2021 Form
10-K rather than amending the prior Forms 10-K and 10-Q for the
affected periods. Your
response should address your consideration of materiality and your
conclusions on
disclosure controls and procedures and internal controls over
financial reporting.
4. Please provide further details of the accounting irregularities that
caused the restatements.
In doing so, discuss the intent of the fraudulent activities and
provide an overview of the
specific financial line items involved.
(4) Discontinued Operations and Assets Held for Sale, page 120
5. We note that your dispositions of Reliability Services ("RS"), Spence
and Nicholson, and
Instrumentation and Sampling ("I&S") have not been reflected within
discontinued
despite sales prices exceeding those of the businesses included within
discontinued
operations. We further note that the businesses reflected within
discontinued operations
incurred losses from operations and on disposal, whereas the RS and
I&S dispositions
resulted in disposal gains. Please tell us in sufficient detail how
you assessed each
disposal under ASC 205-20-45 in determining whether or not it
qualified as a
discontinued operation.
Form 8-K furnished August 11, 2022
Exhibit 99.1, page 1
6. Please address the following comments related to the non-GAAP measures
presented in
your earnings release:
We note your presentation of the non-GAAP measures adjusted
operating income
and adjusted operating margin. Revise to include reconciliations
to the most directly
comparable GAAP measure in accordance with Item 10(e)(1)(i)(B) of
Regulation S-
K.
Arjun Sharma
CIRCOR International, Inc.
September 14, 2022
Page 3
You identify "orders" as a non-GAAP measure. Revise to disclose
how you calculate
this measure and to include a reconciliation to the most directly
comparable GAAP
measure. In doing so, tell us how you identified the most
directly comparable GAAP
measure.
We note that you present percentage changes in orders and
revenues on an "adjusted"
and "organic" basis. Revise to reconcile, in tabular format,
these percentage changes
to the percentage changes on a GAAP basis.
Since your free cash flow presentation does not represent
operating cash flows less
capital expenditures, revise your description of this non-GAAP
measure going
forward to indicate that it represents adjusted free cash flow.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
You may contact Heather Clark at 202-551-3624 or Andrew Blume at
202-551-3254 with
any questions.
FirstName LastNameArjun Sharma Sincerely,
Comapany NameCIRCOR International, Inc.
Division of
Corporation Finance
September 14, 2022 Page 3 Office of
Manufacturing
FirstName LastName