Circor reports third-quarter 2017 financial results
Burlington, mass.--(business wire)--circor international, inc. (nyse: cir), a leading provider of flow control solutions and other highly engineered products for markets including oil & gas, aerospace, power, process and industrial solutions, today announced financial results for the third quarter ended october 1, 2017. third-quarter 2017 highlights revenue of $160 million; gaap eps of $0.22 and adjusted eps of $0.43 orders of $158 million; up 42% year-over-year, 23% organically acquisition of colfax fluid handling expected to close by year end “the circor team generated strong results for the third quarter, posting double-digit growth in revenue and orders led primarily by our energy segment,” said scott buckhout, president and chief executive officer. “robust demand for distributed valves drove energy segment orders up 26% organically. we expect to see continued growth in energy in the fourth quarter. we also reported broad-based strength in our advanced flow solutions segment with a 21% increase in organic orders driven by our aerospace businesses. we expect continued order growth and margin expansion across afs in the fourth quarter.” “during the quarter we announced an agreement to acquire the fluid handling business of colfax,” added buckhout. “this transaction significantly enhances our overall scale and ability to deliver severe service flow-control solutions across a complementary set of attractive end markets. the strategic fit is compelling and our customers are equally enthusiastic about the transaction. in recent weeks, i have met with the fluid handling teams in europe and the u.s., and we’re excited about the strong cultural fit between our companies. we share a common focus on customers, innovation and accountability. we are on track to close the acquisition by year-end.” “as we enter the final quarter of the year, we continue to execute our growth strategy and we remain optimistic about the outlook across most of our end markets,” concluded buckhout. fourth-quarter 2017 guidancethe company will provide its guidance for the fourth quarter of 2017 during the conference call later today. selected consolidated results (unaudited) segment results 1. consolidated and segment results for q3 2017 exclude special and restructuring charges and non-cash acquisition-related intangible amortization, totaling $5.0 million (pre-tax). this net charge includes (i) $1.8 million in transaction fees associated with the acquisition of colfax fluid handling; (ii) $2.7 million charge for non-cash acquisition-related intangible amortization expense; (iii) $0.2 million charge related to the sale of our france build-to-print business; and, (iv) $0.3 million related to previously announced restructuring actions. consolidated and segment results for q3 2016 exclude special and restructuring charges and non-cash acquisition-related intangible amortization, totaling $4.7 million (pre-tax). this includes (i) $1.9 million for non-cash acquisition-related intangible amortization expense; (ii) $0.8 million related to the exit of the company’s california machine shop; (iii) $0.4 million related to the company’s brazil exit; and (iv) $1.6 million related to the company’s suspension of manufacturing operations in china and other restructuring programs. 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 informationcircor international will hold a conference call to review its financial results today, october 27, 2017, 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 measuresadjusted operating income, adjusted operating margin, adjusted net income, adjusted earnings per share (diluted), ebitda, adjusted ebitda, net debt and free cash flow are non-gaap financial measures. these non-gaap financial measures are used by management in our financial and operating decision making because we believe they better reflect our ongoing business and allow for meaningful period-to-period comparisons. we believe these non-gaap financial measures provide useful information to investors and others in understanding and evaluating the company’s current operating performance and future prospects in the same manner as management does, if they so choose. these non-gaap financial measures also allow investors and others to compare the company’s current financial results with the company’s past financial results in a consistent manner. for example: we exclude costs and tax effects associated with restructuring activities, such as reducing overhead and consolidating facilities. we believe that the costs related to these restructuring activities are not indicative of our normal operating costs. we exclude certain acquisition-related costs, including significant transaction costs and amortization of inventory step-ups and the related tax effects. we exclude these costs because we do not believe they are indicative of our normal operating costs. we exclude the expense and tax effects associated with the non-cash amortization of acquisition-related intangible assets because a significant portion of the purchase price for acquisitions may be allocated to intangible assets that have lives of 5 to 20 years. exclusion of the non-cash amortization expense allows comparisons of operating results that are consistent over time for both our newly acquired and long-held businesses and with both acquisitive and non-acquisitive peer companies. we also exclude certain gains/losses and related tax effects, which are either isolated or cannot be expected to occur again with any predictability, and that we believe are not indicative of our normal operating gains and losses. for example, we exclude gains/losses from items such as the sale of a business, significant litigation-related matters and lump-sum pension plan settlements. circor’s management uses these non-gaap measures, in addition to gaap financial measures, as the basis for measuring the company’s operating performance and comparing such performance to that of prior periods and to the performance of our competitors. we use such measures when publicly providing our business outlook, assessing future earnings potential, evaluating potential acquisitions and dispositions and in our financial and operating decision-making process, including for compensation purposes. investors should recognize that these non-gaap measures might not be comparable to similarly titled measures of other companies. these measures should be considered in addition and not as a substitute for or superior to, any measure of performance, cash flow or liquidity prepared in accordance with accounting principles generally accepted in the united states. a reconciliation of the non-gaap financial measures to the most directly comparable gaap measures is available in this news release. safe harbor statementthis 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 website at http://investors.circor.com. consolidated statements of income (in thousands, except per share data) unaudited consolidated statements of cash flows (in thousands) unaudited consolidated balance sheets (in thousands) unaudited summary of orders and backlog (in millions) unaudited october 1,2017 october 2,2016 october 1,2017 october 2,2016 october 1,2017 october 2,2016 segment information (in thousands, except percentages) unaudited reconciliation of key performance measures to commonly used generally accepted accounting principle terms (in thousands, except percentages) unaudited reconciliation of key performance measures to commonly used generally accepted accounting principle terms (in thousands, except per share data) unaudited reconciliation of key performance measures to commonly used generally accepted accounting principle terms (in thousands) unaudited reconciliation of key performance measures to commonly used generally accepted accounting principle terms (in thousands, except percentages) unaudited
