July 29, 2016 - 7:30 AM EDT
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CIRCOR Reports Second-Quarter 2016 Financial Results

CIRCOR International, Inc. (NYSE: CIR), a leading provider of valves and other highly engineered products for markets including oil & gas, power generation and aerospace & defense, today announced financial results for the second quarter ended July 3, 2016.

Second-Quarter 2016 Highlights

  • Delivered revenue of $146 million
  • Achieved GAAP EPS of $0.23 and Adjusted EPS of $0.53
  • Aerospace & Defense orders of $47 million, up 56% versus prior year
  • Restructuring actions remain on track to deliver $15 million of savings in 2016

“CIRCOR delivered solid second-quarter financial results for both revenue and earnings,” said Scott Buckhout, President and Chief Executive Officer. “We achieved year-over-year sales growth in our engineered valves business and we are encouraged to see upstream short-cycle revenue stabilizing at current levels. The power market remains a bright spot globally and led to modest revenue growth in the quarter for our control valves business. In our Aerospace & Defense segment, we reported a 56% increase in orders, which we expect to drive top line growth in the second half of this year. Energy orders overall were down in the quarter due to a challenging oil and gas market and delayed project awards.”

“As we enter the second half of 2016, we remain focused on what we control. We are laying the foundation for long-term growth through careful investments in sales, marketing and engineering, while we continuously improve operations. We are executing well on our simplification and restructuring actions. Our California machining facility closure is complete and we expect to see the positive effect on our margins as the year progresses. Customer on time delivery averaged 91% in the quarter and we are starting to see better working capital performance,” added Buckhout.

“Finally, we remain committed to creating shareholder value through growth, margin expansion, strong cash flow, and disciplined capital deployment,” concluded Buckhout.

Third-Quarter 2016 Guidance
For the third quarter of 2016, the Company will provide its guidance during the conference call later today.

Selected Consolidated Results (unaudited)

         
($ millions except EPS)       Q2 2016 Q2 2015 Change
Revenue $ 146.4 $ 166.9     (12 )%
GAAP Operating Income $ 5.3 $ 5.1 5 %
Adjusted Operating Income1 $ 11.9 $ 15.0 (21 )%
GAAP Operating Margin 3.7 % 3.0 % 70 bps
Adjusted Operating Margin1 8.1 % 9.0 % (90) bps
GAAP Earnings Per Share (Diluted) $ 0.23 $ 0.11 109 %
Adjusted Earnings Per Share (Diluted)1 $ 0.53 $ 0.55 (4 )%
Operating Cash Flow $ 10.1 $ 8.1 25 %
Free Cash Flow2 $ 8.2 $ 4.5 82 %
Orders $ 135.3 $ 141.7 (5 )%

Segment Results

       
($ millions)     Q2 2016 Q2 2015 Change
Energy    
Revenue $ 110.7 $ 127.2 (13 )%
GAAP Operating Margin 9.1 % 7.2 % 190 bps
Adjusted Operating Margin1 13.0 % 13.4 % (40) bps
Orders $ 88.1 $ 111.4 (21 )%
 
Aerospace & Defense
Revenue $ 35.7 $ 39.7 (10 )%
GAAP Operating Margin 1.8 % 3.5 % (170) bps
Adjusted Operating Margin1 8.4 % 8.8 % (40) bps
Orders $ 47.2 $ 30.3 56 %
 

1. Consolidated and Segment Results for Q2 2016 exclude special, restructuring and impairment charges totaling $6.6 million. This includes (i) $1.9 million for non-cash acquisition-related intangible amortization expense, (ii) $2.1 million related to the exit of the Company's California machine shop, (iii) $1.5 million related to the Company's Brazil exit, and (iv) $1.1 million related to the Company's suspension of manufacturing operations in China and other restructuring programs. Q2 2015 results exclude special charges of $5.8 million, restructuring-related inventory charges of $2.0 million and $2.1 million for non-cash acquisition-related intangible amortization expense.

2. Free Cash Flow is a non-GAAP financial measure and is calculated by subtracting GAAP capital expenditures, net of proceeds from asset sales, from GAAP Operating Cash Flow.

Conference Call Information
CIRCOR International will hold a conference call to review its financial results today, July 29, 2016, at 9:00 a.m. ET. To listen to the conference call and view the accompanying presentation slides, visit “Webcasts & Presentations” in the “Investors” portion of the CIRCOR website. The call also can be accessed by dialing (877) 407-5790 or (201) 689-8328. The webcast will be archived for one year on the Company’s website.

Use of Non-GAAP Financial Measures
Adjusted net income, adjusted earnings per share (diluted), adjusted operating income, adjusted operating margin, and free cash flow are non-GAAP financial measures and are intended to serve as a complement to results provided in accordance with accounting principles generally accepted in the United States. CIRCOR believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release.

Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Reliance should not be placed on forward-looking statements because they involve unknown risks, uncertainties and other factors, which are, in some cases, beyond the control of CIRCOR. Any statements in this press release that are not statements of historical fact are forward-looking statements, including, but not limited to, those relating to CIRCOR’s future performance, including the realization of cost reductions from restructuring activities. Actual events, performance or results could differ materially from the anticipated events, performance or results expressed or implied by such forward-looking statements. BEFORE MAKING ANY INVESTMENT DECISIONS REGARDING OUR COMPANY, WE STRONGLY ADVISE YOU TO READ THE SECTION ENTITLED "RISK FACTORS" IN OUR MOST RECENT ANNUAL REPORT ON FORM 10-K AND SUBSEQUENT REPORTS ON FORMS 10-Q, WHICH CAN BE ACCESSED UNDER THE "INVESTORS" LINK OF OUR WEBSITE AT WWW.CIRCOR.COM. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

About CIRCOR International, Inc.
CIRCOR International, Inc. designs, manufactures and markets highly engineered products and sub-systems for markets including oil & gas, power generation and aerospace & defense. CIRCOR has a diversified product portfolio with recognized, market-leading brands that fulfill its customers’ unique application needs. The Company’s strategy is to grow organically and through complementary acquisitions; simplify CIRCOR’s operations; achieve world class operational excellence; and attract and retain top industry talent. For more information, visit the Company’s investor relations web site at http://investors.circor.com.

 
CIRCOR INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)

UNAUDITED

    Three Months Ended     Six Months Ended
July 3, 2016   July 5, 2015 July 3, 2016   July 5, 2015
Net revenues $ 146,392 $ 166,906 $ 297,190 $ 332,766
Cost of revenues 99,961   116,112   205,526   229,323  
GROSS PROFIT 46,431 50,794 91,664 103,443
Selling, general and administrative expenses 36,490 42,394 74,289 81,201
Special charges, net 4,594   3,310   6,533   4,821  
OPERATING INCOME 5,347   5,090   10,842   17,421  
Other expense (income):
Interest expense, net 605 805 1,236 1,446
Other income, net (549 ) (104 ) (1,077 ) (610 )
TOTAL OTHER EXPENSE, NET 56   701   159   836  
INCOME BEFORE INCOME TAXES 5,291 4,389 10,683 16,585
Provision for income taxes 1,478   2,517   2,998   5,800  
NET INCOME $ 3,813   $ 1,872   $ 7,685   $ 10,785  
Earnings per common share:
Basic $ 0.23 $ 0.11 $ 0.47 $ 0.63
Diluted $ 0.23 $ 0.11 $ 0.46 $ 0.62
Weighted average number of common shares outstanding:
Basic 16,424 16,828 16,403 17,245
Diluted 16,595 16,900 16,538 17,306
Dividends paid per common share $ 0.0375 $ 0.0375 $ 0.0750 $ 0.0750
 
 
CIRCOR INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

UNAUDITED

      Six Months Ended
July 3, 2016   July 5, 2015
OPERATING ACTIVITIES
Net income $ 7,685 $ 10,785
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation 6,476 7,150
Amortization 5,098 3,537
Bad debt (recovery) expense (853 ) 1,469
Loss on write down of inventory 4,011 3,673
Compensation expense of share-based plans 2,909 4,122
Tax effect of share-based plan compensation 116 (287 )
Loss on sale or write down of property, plant and equipment 3,116 377
Gain on sale of business (972 )
Changes in operating assets and liabilities, net of effects of acquisition and disposition:
Trade accounts receivable 11,555 12,313
Inventories 13,281 (27,875 )
Prepaid expenses and other assets (3,480 ) (8,484 )
Accounts payable, accrued expenses and other liabilities (32,161 ) (14,174 )
Net cash provided by (used in) operating activities 17,753   (8,366 )
INVESTING ACTIVITIES
Purchases of property, plant and equipment (6,998 ) (5,567 )
Proceeds from the sale of property, plant and equipment 1,138
Proceeds from the sale of affiliate 2,759
Business acquisition, net of cash acquired   (79,983 )
Net cash used in investing activities (5,860 ) (82,791 )
FINANCING ACTIVITIES
Proceeds from long-term debt 65,939 202,380
Payments of long-term debt (58,890 ) (100,533 )
Dividends paid (1,249 ) (1,308 )
Proceeds from the exercise of stock options 180 70
Tax effect of share-based plan compensation (116 ) 287
Purchases of common stock   (69,517 )
Net cash provided by financing activities 5,864   31,379  
Effect of exchange rate changes on cash and cash equivalents 672   (6,567 )
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 18,429 (66,345 )
Cash and cash equivalents at beginning of period 54,541   121,372  
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 72,970   $ 55,027  
 
 
CIRCOR INTERNATIONAL, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)

UNAUDITED

      July 3, 2016   December 31, 2015
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 72,970 $ 54,541

Trade accounts receivable, less allowance for doubtful accounts of $7,811 and
$8,290, respectively

115,327 125,628
Inventories 162,347 177,840
Prepaid expenses and other current assets 21,522   16,441  
Total Current Assets 372,166   374,450  
PROPERTY, PLANT AND EQUIPMENT, NET 81,973 87,029
OTHER ASSETS:
Goodwill 117,138 115,452
Intangibles, net 43,688 48,981
Deferred income taxes 36,328 36,799
Other assets 6,183   7,204  
TOTAL ASSETS $ 657,476   $ 669,915  
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable $ 45,987 $ 64,284
Accrued expenses and other current liabilities 39,945 52,878
Accrued compensation and benefits 19,121 18,424
Income taxes payable 9,174   6,585  
Total Current Liabilities 114,227   142,171  
LONG-TERM DEBT 97,600 90,500
DEFERRED INCOME TAXES 9,927 10,424
OTHER NON-CURRENT LIABILITIES 24,355 26,043
SHAREHOLDERS’ EQUITY:
Common stock 178 177
Additional paid-in capital 286,601 283,621
Retained earnings 264,375 257,939
Common treasury stock, at cost (74,972 ) (74,972 )
Accumulated other comprehensive loss, net of tax (64,815 ) (65,988 )
Total Shareholders’ Equity 411,367   400,777  
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 657,476   $ 669,915  
 
 
CIRCOR INTERNATIONAL, INC.

SUMMARY OF ORDERS AND BACKLOG

(in millions)

UNAUDITED

    Three Months Ended   Six Months Ended
July 3,
2016
  July 5,
2015
July 3,
2016
  July 5,
2015
ORDERS (1)
Energy $ 88.1 $ 111.4 $ 187.9 $ 254.5
Aerospace & Defense 47.2   30.3   84.1   69.5
Total orders $ 135.3   $ 141.7   $ 272.0   $ 324.0
 
BACKLOG (2) July 3,
2016
July 5,
2015
Energy $ 142.1 $ 248.0
Aerospace & Defense 102.0   96.3  
Total backlog $ 244.1   $ 344.3  
 

Note 1: Orders do not include the foreign exchange impact due to the re-measurement of customer order backlog amounts denominated in foreign currencies.

Note 2: Backlog includes unshipped customer orders.

 
CIRCOR INTERNATIONAL, INC.

SUMMARY REPORT BY SEGMENT

(in thousands, except percentages)

UNAUDITED

   

2015

2016
1ST QTR 2ND QTR 3RD QTR 4TH QTR TOTAL 1ST QTR 2ND QTR TOTAL
NET REVENUES
Energy $ 127,586 $ 127,230 $ 122,905 $ 124,412 $ 502,133 $ 112,620 $ 110,678 $ 223,298
Aerospace & Defense 38,274   39,676   36,353   39,832   154,134   38,178   35,714   73,892  
Total $ 165,860   $ 166,906   $ 159,258   $ 164,243   $ 656,267   $ 150,798   $ 146,392   $ 297,190  
OPERATING MARGIN
Energy 13.8 % 13.4 % 15.4 % 13.4 % 14.0 % 12.6 % 13.0 % 12.8 %
Aerospace & Defense 8.0 % 8.8 % 9.1 % 10.4 % 9.1 % 9.3 % 8.4 % 8.9 %
Segment operating margin 12.4 % 12.3 % 14.0 % 12.7 % 12.8 % 11.8 % 11.9 % 11.8 %
Corporate expenses (3.6 )% (3.3 )% (3.8 )% (2.5 )% (3.3 )% (4.3 )% (3.7 )% (4.0 )%
Adjusted operating margin 8.8 % 9.0 % 10.1 % 10.2 % 9.5 % 7.5 % 8.1 % 7.8 %
Restructuring related inventory charges % 1.2 % 4.0 % 0.6 % 1.4 % 1.3 % 0.1 % 0.7 %
Impairment charges % % 1.6 % % 0.4 % % % %
Special restructuring charges, net 0.9 % 1.9 % 0.2 % (0.2 )% 0.7 % 0.8 % 2.2 % 1.5 %
Special acquisition amortization % 1.3 % 1.6 % 1.4 % 1.0 % 1.2 % 1.3 % 1.3 %
Special other charges, net of recoveries % 0.1 % 5.0 % 1.0 % 1.5 % 0.5 % 0.9 % 0.7 %
Brazil restatement impact 0.4 % 1.5 % % % 0.5 % % % %
Total GAAP operating margin 7.4 % 3.0 % (2.2 )% 7.5 % 4.0 % 3.6 % 3.7 % 3.6 %
 
 
CIRCOR INTERNATIONAL, INC.

SUMMARY REPORT BY SEGMENT

(in thousands, except percentages)

UNAUDITED

     
2015 2016
1ST QTR 2ND QTR 3RD QTR 4TH QTR TOTAL 1ST QTR 2ND QTR TOTAL
INCOME STATEMENT
Energy $ 17,550 $ 17,008 $ 18,932 $ 16,724 $ 70,214 $ 14,186 $ 14,346 $ 28,532
Aerospace & Defense 3,045   3,494   3,298   4,146  

 

13,982   3,562   3,011   6,573  
Segment operating income 20,595 20,502 22,230 20,870 84,197 17,748 17,357 35,105
Corporate expenses (6,034 ) (5,477 ) (6,078 ) (4,122 ) (21,710 ) (6,488 ) (5,431 ) (11,919 )

Adjusted operating income

14,561 15,025 16,152 16,748 62,487 11,260 11,926 23,186
Restructuring related inventory charges 2,005 6,412 974 9,391 1,958 75 2,033
Impairment charges 2,502 2,502
Special restructuring charges, net 1,512 3,127 342 (347 ) 4,634 1,163 3,259 4,422
Special acquisition amortization 2,110 2,490 2,238 6,838 1,868 1,911 3,779
Special other charges, net of recoveries (1 ) 183 7,935 1,603 9,720 776 1,334 2,110
Brazil restatement impact 719   2,509       3,228        
Total GAAP operating income (loss) 12,331 5,090 (3,529 ) 12,281 26,174 5,495 5,347 10,842
INTEREST EXPENSE, NET (640 ) (805 ) (828 ) (570 ) (2,844 ) (631 ) (605 ) (1,236 )
OTHER INCOME (EXPENSE), NET 506   104   587   (2,099 ) (902 ) 528   549   1,077  
PRETAX INCOME (LOSS) 12,197 4,389 (3,770 ) 9,612 22,428 5,392 5,291 10,683
PROVISION FOR INCOME TAXES (3,284 ) (2,517 ) (4,308 ) (2,456 ) (12,565 ) (1,520 ) (1,478 ) (2,998 )
EFFECTIVE TAX RATE 26.9 % 57.3 % (114.3 )% 25.6 % 56.0 % 28.2 % 27.9 % 28.1 %
NET INCOME (LOSS) $ 8,913   $ 1,872   $ (8,078 ) $ 7,156   $ 9,863   $ 3,872   $ 3,813   $ 7,685  
Weighted Average Common Shares Outstanding (Diluted) 17,712 16,900 16,485 16,555 16,913 16,481 16,595 16,538
EARNINGS (LOSS) PER COMMON SHARE (Diluted) $ 0.50   $ 0.11   $ (0.49 ) $ 0.43   $ 0.58   $ 0.23   $ 0.23   $ 0.46  
 
 
CIRCOR INTERNATIONAL, INC.

RECONCILIATION OF KEY PERFORMANCE MEASURES TO COMMONLY USED GENERALLY ACCEPTED ACCOUNTING PRINCIPLE TERMS

(in thousands, except percentages)

UNAUDITED

      2015 2016
1ST QTR 2ND QTR 3RD QTR 4TH QTR TOTAL 1ST QTR 2ND QTR TOTAL
FREE CASH FLOW AS % OF NET INCOME (LOSS) (207 )% 239 % (27 )% 397 % 169 % 96 % 214 % 155 %
FREE CASH FLOW $ (18,415 ) $ 4,483 $ 2,169 $ 28,403 $ 16,640 $ 3,720 $ 8,174 $ 11,894
ADD:
Capital expenditures, net of sale proceeds 1,983   3,584   2,837   2,098   10,502   3,934   1,926   5,860  
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES $ (16,432 ) $ 8,067   $ 5,006   $ 30,501   $ 27,142   $ 7,654   $ 10,100   $ 17,754  
NET (CASH) DEBT $ (66,337 ) $ 59,051 $ 57,277 $ 35,959 $ 35,959 $ 31,220 $ 24,630 $ 24,630
ADD:

Cash & cash equivalents

103,883   55,027   53,822   54,541   54,541   66,580   72,970   72,970  
TOTAL DEBT $ 37,546   $ 114,078   $ 111,099   $ 90,500   $ 90,500   $ 97,800   $ 97,600   $ 97,600  
TOTAL SHAREHOLDERS' EQUITY $ 462,384 $ 421,070 $ 407,979 $ 400,777 $ 400,777 $ 414,107 $ 411,367 $ 411,367
 
DEBT AS % OF EQUITY 8 % 27 % 27 % 23 % 23 % 24 % 24 % 24 %
NET DEBT AS % OF EQUITY (14 )% 14 % 14 % 9 % 9 % 8 % 6 % 6 %
 
 
CIRCOR INTERNATIONAL, INC.

RECONCILIATION OF KEY PERFORMANCE MEASURES TO COMMONLY USED GENERALLY ACCEPTED ACCOUNTING PRINCIPLE TERMS

(in thousands, except percentages)

UNAUDITED

    2015 2016
1ST QTR 2ND QTR 3RD QTR 4TH QTR TOTAL 1ST QTR 2ND QTR TOTAL
ADJUSTED NET INCOME $ 10,564 $ 9,357 $ 10,635 $ 10,512 $ 41,068 $ 8,683 $ 8,781 $ 17,464
LESS:
Restructuring related inventory charges 2,005 6,412 974 9,391 1,958 75 2,033
Impairment charges 2,502 2,502
Special restructuring charges, net 1,512 3,127 342 (347 ) 4,634 1,163 3,259 4,422
Special acquisition amortization 2,110 2,490 2,238 6,838 1,868 1,911 3,779
Special other charges, net of recoveries (1 ) 183 7,935 1,603 9,720 776 1,334 2,110
Brazil restatement impact 719 2,509 3,228
Income tax impact (579 ) (2,449 ) (968 ) (1,112 ) (5,108 ) (954 ) (1,611 ) (2,565 )
NET INCOME (LOSS) $ 8,913   $ 1,872   $ (8,078 ) $ 7,156   $ 9,863   $ 3,872   $ 3,813   $ 7,685  
 
ADJUSTED EARNINGS PER SHARE (Diluted) $ 0.60 $ 0.55 $ 0.64 $ 0.63 $ 2.43 $ 0.52 $ 0.53 $ 1.05
LESS:
Restructuring related inventory charges 0.12 0.39 0.06 0.57 0.12 0.12
Impairment charges 0.15 0.15
Special restructuring charges, net 0.09 0.19 0.02 (0.02 ) 0.28 0.07 0.20 0.27
Special acquisition amortization 0.12 0.15 0.14 0.41 0.11 0.12 0.23
Special other charges, net of recoveries 0.01 0.48 0.10 0.59 0.05 0.08 0.13
Brazil restatement impact 0.04 0.15 0.19
Income tax impact (0.03 ) (0.15 ) (0.06 ) (0.07 ) (0.31 ) (0.06 ) (0.10 ) (0.16 )
EARNINGS (LOSS) PER COMMON SHARE (Diluted) $ 0.50   $ 0.11   $ (0.49 ) $ 0.43   $ 0.58   $ 0.23   $ 0.23   $ 0.46  
 
 
CIRCOR INTERNATIONAL, INC.

RECONCILIATION OF KEY PERFORMANCE MEASURES TO COMMONLY USED GENERALLY ACCEPTED ACCOUNTING PRINCIPLE TERMS

(in thousands, except percentages)

UNAUDITED

    2015 2016
1ST QTR 2ND QTR 3RD QTR 4TH QTR TOTAL 1ST QTR 2ND QTR TOTAL
ADJUSTED EBITDA $ 19,299 $ 19,474 $ 20,980 $ 18,927 $ 78,681 $ 15,712 $ 16,346 $ 32,058
LESS:
Restructuring related inventory charges (2,005 ) (6,412 ) (974 ) (9,391 ) (1,958 ) (75 ) (2,033 )
Impairment charges (2,502 ) (2,502 )
Special restructuring charges, net (1,512 ) (3,127 ) (342 ) 347 (4,634 ) (1,163 ) (3,259 ) (4,422 )
Special other charges, net of recoveries 1 (183 ) (7,935 ) (1,603 ) (9,720 ) (776 ) (1,334 ) (2,110 )
Brazil restatement impact (719 ) (2,509 )     (3,228 )      
EBITDA $ 17,068   $ 11,650   $ 3,789   $ 16,698   $ 49,206   $ 11,815   $ 11,678   $ 23,493  
LESS:
Interest expense, net (641 ) (805 ) (828 ) (570 ) (2,844 ) (631 ) (605 ) (1,236 )
Depreciation (3,521 ) (3,629 ) (3,526 ) (3,578 ) (14,254 ) (3,263 ) (3,213 ) (6,476 )
Amortization (710 ) (2,827 ) (3,205 ) (2,939 ) (9,681 ) (2,529 ) (2,569 ) (5,098 )
Provision for income taxes (3,284 ) (2,517 ) (4,308 ) (2,456 ) (12,565 ) (1,520 ) (1,478 ) (2,998 )
NET INCOME (LOSS) $ 8,913   $ 1,872   $ (8,078 ) $ 7,156   $ 9,863   $ 3,872   $ 3,813   $ 7,685  
 
 
CIRCOR INTERNATIONAL, INC.

SUPPLEMENTAL SEGMENT DATA

(in thousands, except percentages)

UNAUDITED

      2015   2016
1ST QTR   2ND QTR   3RD QTR   4TH QTR   TOTAL   1ST QTR   2ND QTR   TOTAL
Energy   A&D   Energy   A&D   Energy   A&D   Energy   A&D   Energy   A&D   Energy   A&D   Energy   A&D   Energy   A&D
Adjusted operating margin 13.8 %   8.0 %   13.4 %   8.8 %   15.4 %   9.1 %   13.4 %   10.4 %   14.0 %   9.1 %   12.6 %   9.3 %   13.0 %   8.4 %   13.8 %   8.0 %
Restructuring related inventory charges % % 0.1 % 4.7 % 5.2 % % 0.4 % 1.2 % 1.4 % 1.5 % 1.7 % 0.1 % 0.1 % % % %
Impairment charges % % % % 2.0 % % % % 0.5 % % % % % % % %
Special restructuring charges, net 0.3 % 3.1 % 2.2 % 0.8 % 0.2 % 0.2 % (0.3 )% 0.1 % 0.6 % 1.0 % (0.2 )% 3.8 % 0.8 % 6.6 % 0.3 % 3.1 %
Special acquisition amortization % % 1.7 % % 2.0 % % 1.8 % % 1.4 % % 1.7 % % 1.7 % % % %
Special other charges, net of recoveries 0.4 % (2.6 )% 0.2 % (0.2 )% 6.5 % % 0.7 % % 1.9 % (0.7 )% 0.7 % % 1.2 % % 0.4 % (2.6 )%
Brazil restatement impact 0.6 %   %   2.0 %   %   %   %   %   %   0.6 %   %   %   %   %   %   0.6 %   %
GAAP operating margin 12.5 %   7.5 %   7.2 %   3.5 %   (0.6 )%   8.9 %   10.9 %   9.1 %   7.6 %   7.2 %   8.8 %   5.5 %   9.1 %   1.8 %   12.5 %   7.5 %
 
 
    2015   2016
1ST QTR   2ND QTR   3RD QTR   4TH QTR   TOTAL   1ST QTR   2ND QTR   TOTAL
Energy A&D   Energy A&D   Energy A&D   Energy A&D   Energy A&D   Energy A&D   Energy A&D   Energy A&D
Adjusted operating income $ 17,550 $ 3,045   $ 17,008 $ 3,494   $ 18,932 $ 3,298   $ 16,724 $ 4,146   $ 70,214 $ 13,982   $ 14,186 $ 3,562   $ 14,346 $ 3,011   $ 28,532 $ 6,573
Restructuring related inventory charges 153 1,852 6,412 508 466 7,073 2,318 1,919 39 74 1,993 39
Impairment charges 2,502 2,502
Special restructuring charges, net 343 1,169 2,818 309 279 63 (394 ) 47 3,046 1,588 (278 ) 1,441 900 2,359 622 3,800
Special acquisition amortization 2,110 2,490 2,238 6,838 1,868 1,911 3,779
Special other charges, net of recoveries 556 (977 ) 248 (65 ) 7,935 828 9,567 (1,042 ) 774 1,335 2,109
Brazil restatement impact 719       2,509                   3,228                    
GAAP operating income $ 15,932   $ 2,853     $ 9,170   $ 1,398     $ (686 ) $ 3,235     $ 13,544   $ 3,633     $ 37,960   $ 11,118     $ 9,903   $ 2,082     $ 10,126   $ 652     $ 20,029   $ 2,734
 

CIRCOR International
Rajeev Bhalla, 781-270-1200
Executive Vice President & Chief Financial Officer


Source: Business Wire (July 29, 2016 - 7:30 AM EDT)

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