Circor international reports third quarter 2011 financial results
Burlington, mass.--(business wire)--circor international, inc. (nyse: cir), a leading provider of valves and other highly engineered products for the industrial, aerospace and energy markets, today announced financial results for the third quarter ended october 2, 2011, highlighted by revenue growth across all business segments. key performance metrics were in line with company expectations. “circor reported strong revenues and earnings for the third quarter,” said chairman and chief executive officer bill higgins. “revenues increased 18% year over year with solid demand across all of our segments. bookings were also up as we won another significant aerospace order, this time a multi-year military landing gear program on a new platform for us.” “on balance, the demand environment remains positive,” higgins continued. “we are encouraged by expanding energy markets, rising commercial aerospace build rates and our continuing ability to win key large programs. we remain cautiously optimistic about the flow control segment, however, we recently experienced weakness in led equipment demand from china. overall, we are positive about 2012, and we continue to execute our five-year strategy of doubling circor’s revenues and significantly improving segment margins.” consolidated results revenues for the third quarter of 2011 were $210.0 million, an 18% increase from $177.6 million in the third quarter of 2010. circor reported net income for the third quarter of 2011 of $10.9 million, or $0.63 per diluted share, compared with net income of $10.4 million, or $0.60 per diluted share, for the third quarter of 2010. third quarter earnings benefitted from a $1.6 million, or $0.06 per diluted share, recovery from a long-standing legal case. excluding leslie asbestos and bankruptcy charges, net of tax, adjusted earnings per diluted share for the third quarter of 2011 were $0.62 and for 2010 were $0.69. consolidated adjusted operating earnings (which exclude leslie asbestos and bankruptcy charges) were $15.7 million for the third quarter of 2011 compared with $15.8 million for the third quarter of 2010, a decrease of 1%. the company received orders totaling $227.3 million during the third quarter of 2011, an increase of 10% compared with the third quarter of 2010. backlog as of october 2, 2011 was $440.2 million, up 12% from backlog of $391.6 million at october 3, 2010. during the third quarter of 2011, the company used $5.2 million of free cash flow (defined as net cash from operating activities less capital expenditures), which compares to a use of $0.5 million in the third quarter of 2010. energy energy segment revenues of $103.3 million for the quarter ended october 2, 2011 represent a 28% increase from $80.6 million for the quarter ended october 2, 2010. the increase was primarily due to organic growth of 21% as a result of double digit improvement in all sectors. the remainder of the increase includes 4% growth from the february 2011 brazilian energy acquisition and a positive foreign currency impact of 3%. incoming orders for the third quarter of 2011 were $93.6 million, a decrease of 5% year over year as a result of fewer large international projects, which fluctuate quarter to quarter, and an unusually large $12.5 million pipeline solutions project order we received in the third quarter of 2010. these declines were partially offset by increased demand for north american short-cycle orders and other pipeline solutions. ending backlog totaled $202.0 million, an increase of 32% year over year. for the third quarter of 2011, the energy segment adjusted operating margin of 7.2% was down from 11.1% from the third quarter of 2010 primarily due to the impact of the brazil energy acquisition, including integration activities, as well as unfavorable pricing for large international projects. sequentially, the energy segment margins improved 190 basis points partially due to improvement in our large international projects. aerospace aerospace segment revenues increased by 15% to $32.7 million for the third quarter of 2011 from $28.3 million in the third quarter of 2010. the increase in revenues was driven by 14% organic growth and a 1% positive foreign currency impact. incoming orders for the third quarter of 2011 were $62.8 million, an increase of 101% year over year, primarily due to a $26 million multi-year military landing gear order on a new platform for circor. ending backlog totaled $160.4 million, an increase of 5% year over year. the aerospace segment’s adjusted operating margin was 5.6% for the third quarter of 2011, compared with 9.6% for the third quarter of 2010. third-quarter adjusted operating margins decreased primarily due to investments in our recently acquired sylmar, california landing gear facility to support our recent landing gear program wins, as well as unfavorable product mix and development costs associated with new program wins, partially offset by favorable volume. flow technologies flow technologies segment revenues increased 8% to $74.0 million for the third quarter of 2011 from $68.6 million in the third quarter of 2010. third-quarter 2011 revenues reflected organic growth of 6% with strength across most end markets and a favorable foreign currency impact of 2%. incoming orders for this segment were $70.8 million for the third quarter of 2011, a decrease of 9% year over year due primarily to softness in led equipment demand from china, which had been very strong during the past year. ending backlog totaled $77.8 million, a decrease of 9% year over year as a result of lower led equipment orders and the delivery of large maritime projects. this segment’s adjusted operating margin, which excludes the impact of leslie asbestos and bankruptcy charges, for the third quarter of 2011 grew to 13.6%, compared with 13.1% in the third quarter of 2010. business and financial outlook circor currently expects revenues for the fourth quarter of 2011 in the range of $213 million to $222 million. earnings are expected to be in the range of $0.53 to $0.63 per diluted share. circor’s guidance for earnings per share assumes a 30% tax rate and that exchange rates remain at present levels. conference call information circor international will hold a conference call to review its financial results today, november 3, 2011, at 10:00 a.m. et. those who wish to listen to the conference call and view the accompanying presentation slides should visit “webcasts & presentations” in the “investors” portion of the circor website. the live call also can be accessed by dialing (877) 407-5790 or (201) 689-8328. if you are unable to listen to the live call, 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 diluted share, 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 fourth-quarter revenue and earnings guidance. 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 valves and other highly engineered products for the industrial, aerospace and energy markets. with more than 7,000 customers in over 100 countries, circor has a diversified product portfolio with recognized, market-leading brands. circor’s culture, built on the circor business system, is defined by the company’s commitment to attracting, developing and retaining the best talent and pursuing continuous improvement in all aspects of its business and operations. the company’s strategy includes growing organically by investing in new, differentiated products; adding value to component products; and increasing the development of mission-critical subsystems and solutions. circor also plans to leverage its strong balance sheet to acquire strategically complementary businesses. for more information, visit the company’s investor relations web site at http://investors.circor.com. note 1: orders do not include the foreign exchange impact due to the re-measurement of customer order backlog amounts denominated inforeign currencies. 2010 2011 taxes]
