cir-20230402

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 2, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-14962

CIRCOR INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Delaware

04-3477276

(State or Other Jurisdiction of
Incorporation or Organization)

(I.R.S. Employer
Identification No.)

30 Corporate Drive, Suite 200

Burlington,

01803-4238

(Address of principal executive offices)

(Zip Code)

(781) 270-1200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12 (b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	CIR	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☒

Emerging growth company

☐

Non-accelerated filer

☐

Smaller reporting company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes ☐ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 8, 2023, there were 20,390,445 shares of the registrant’s Common Stock, par value $0.01 per share, outstanding.

CIRCOR INTERNATIONAL, INC.

TABLE OF CONTENTS


		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets as of April 2, 2023 and December 31, 2022	3
	Condensed Consolidated Statements of Operations for the Three Months Ended April 2, 2023 and April 3, 2022	4
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three Months Ended April 2, 2023 and April 3, 2022	5
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended April 2, 2023 and April 3, 2022	6
	Condensed Consolidated Statements of Shareholders' Equity for the Three Months Ended April 2, 2023 and April 3, 2022	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	30
PART II.	OTHER INFORMATION	32
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32




Item 6.	Exhibits	33
Signatures		34

PART I. FINANCIAL INFORMATION


ITEM 1.			FINANCIAL STATEMENTS

CIRCOR INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

(UNAUDITED)


	April 2, 2023		December 31, 2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	52,080	$	64,275

Trade accounts receivable, net	111,557		109,754
Inventories	156,967		139,786

Prepaid expenses and other current assets	120,124		117,766


Total Current Assets	440,728		431,581
PROPERTY, PLANT AND EQUIPMENT, NET	142,147		141,141
OTHER ASSETS:
Goodwill	120,114		119,847
Intangibles, net	249,379		256,338
Lease right-of-use assets, net	41,389		42,491
Deferred income taxes	507		512
Other assets	21,465		20,777
TOTAL ASSETS	$	1,015,729	$	1,012,687
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	80,224	$	78,778
Accrued expenses and other current liabilities	83,695		84,510
Accrued compensation and benefits	28,100		30,817

Total Current Liabilities	192,019		194,105
LONG-TERM DEBT	500,042		496,534
DEFERRED INCOME TAXES	18,422		18,238
PENSION LIABILITY, NET	87,090		85,968
LONG-TERM LEASE LIABILITIES	37,618		38,480
OTHER NON-CURRENT LIABILITIES	19,300		20,316
COMMITMENTS AND CONTINGENCIES (NOTE 10)
SHAREHOLDERS’ EQUITY:
Preferred stock, $0.01 par value; 1,000,000 shares authorized; no shares issued and outstanding at April 2, 2023 and December 31, 2022	—		—
Common stock, $0.01 par value; 29,000,000 shares authorized; 21,762,933 and 21,736,911 issued at April 2, 2023 and December 31, 2022, respectively	218		218
Additional paid-in capital	456,685		456,102
Accumulated deficit	(179,100)		(178,693)
Common treasury stock, at cost (1,372,488 shares at April 2, 2023 and December 31, 2022)	(74,472)		(74,472)
Accumulated other comprehensive loss, net of tax	(42,093)		(44,109)
Total Shareholders’ Equity	161,238		159,046
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,015,729	$	1,012,687

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CIRCOR INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(UNAUDITED)


	Three Months Ended
	April 2, 2023		April 3, 2022
Net revenues	$	203,097	$	185,655
Cost of revenues	129,031		130,372
Gross profit	74,066		55,283
Selling, general and administrative expenses	54,666		58,069
Special and restructuring charges, net	1,484		9,003
Operating income (loss)	17,916		(11,789)
Other expense (income):
Interest expense, net	14,528		9,456
Other expense (income), net	214		(1,287)
Total other expense, net	14,742		8,169
Income (loss) before income taxes	3,174		(19,958)
Provision for income taxes	3,581		1,523


Net Loss	$	(407)	$	(21,481)


Net loss per share (basic and diluted)	$	(0.02)	$	(1.06)








Weighted-average common shares (basic and diluted)	20,368		20,310

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CIRCOR INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)

(UNAUDITED)


	Three Months Ended
	April 2, 2023		April 3, 2022
Net loss	$	(407)	$	(21,481)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	2,065		(3,075)
Interest rate swap adjustments (1)	—		1,693
Pension adjustment	(49)		51

Other comprehensive income (loss), net of tax	2,016		(1,331)
COMPREHENSIVE INCOME (LOSS)	$	1,609	$	(22,812)

(1) Net of an income tax effect of $0.0 million for the three months ended April 3, 2022.

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CIRCOR INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(UNAUDITED)


	Three Months Ended
OPERATING ACTIVITIES	April 2, 2023		April 3, 2022
Net loss	$	(407)	$	(21,481)


Adjustments

SEC Form 10-Q filed by CIRCOR International Inc.