CIRCOR Reports First-Quarter 2021 Financial Results

Rhea-AI Summary

CIRCOR International, Inc. (NYSE: CIR) reported its Q1 2021 results, highlighting a strong sequential orders growth of 35% to $227 million. Despite this, revenue fell by 6% year-over-year to $181 million, with notable declines in both Industrial and Aerospace & Defense segments. GAAP loss per share was $(0.35), while adjusted EPS rose 20% to $0.24. The company maintains a $421 million backlog and provides an optimistic full-year outlook, expecting organic revenue growth of 2-4% and adjusted EPS of $2.10-$2.30.

Positive

• Orders increased 35% sequentially to $227 million.
• Adjusted EPS rose 20% to $0.24.
• Full-year organic revenue growth guidance improved to 2-4%.

Negative

• Revenue declined 6% year-over-year to $181 million.
• GAAP loss per share of $(0.35).
• Q2 revenue expected to decline by (2)-(4)%.

CIRCOR International, Inc. (NYSE: CIR), one of the world’s leading providers of mission critical flow control products and services for the Industrial and Aerospace & Defense markets, today announced GAAP and adjusted financial results for the first quarter ended April 4, 2021.

First Quarter 2021 Overview:

• Strong orders of $227 million, up 35% sequentially, with improvement across end markets
• Orders up 9% reported and 7% organically
  • Industrial orders of $154 million, up 13% reported and 11% organically
  • Aerospace & Defense orders of $73 million, up 1% reported and flat organically
• Revenue of $181 million, down (6)% reported and (8)% organically
  • Industrial revenue of $121 million, down (5)% reported and (6)% organically
  • Aerospace & Defense revenue of $60 million, down (8)% reported and (10)% organically
• GAAP operating margin of 0.2%; Adjusted operating margin of 6.9%, up 110 bps
• GAAP loss per share of $(0.35); Adjusted earnings per share of $0.24, up 20%
• GAAP operating cash flow of $(18) million; Free cash flow of $(21) million, up 23%

CIRCOR President and CEO Scott Buckhout said, “Our team delivered solid first quarter 2021 results highlighted by sequential orders growth of 35%. Notably, we secured several large orders in our Defense business and saw recovery across virtually all industrial end markets. We are well positioned to deliver our 2021 commitments."

Mr. Buckhout continued, "We continue to make progress on our strategic priorities. With eight new product launches in the first quarter, we are on track to deliver 45 new products in 2021 that will further improve our product line vitality and support our long-term organic growth targets. In addition, we expect continued margin expansion and free cash flow improvement through the year as we drive value-based pricing, and further improve our operations using the CIRCOR Operating System.”

Mr. Buckhout concluded, "With our $421 million backlog, we’re confident that we will deliver the high end of our 2021 organic revenue growth and adjusted EPS guidance provided in March. Going forward, we continue to focus on creating long-term value for shareholders by positioning the Company for growth, expanding margins, generating strong free cash flow, and de-levering the balance sheet.”

2Q'21 Guidance Update

In the second quarter of 2021, CIRCOR expects reported revenue to increase from 0 to 2% and organic revenue to decline (2) - (4)%. On a reported basis, Industrial revenue is expected to grow 1 to 4% led by our shorter cycle businesses and Aerospace & Defense revenue is expected to decrease 0 to (5)% driven by continued lower demand in Commercial Aerospace and timing of Defense shipments. In both businesses, strong orders in the first quarter will lead to higher deliveries in the second half of 2021. In addition, CIRCOR expects adjusted EPS of $0.30 to $0.35 and free cash flow is expected to be breakeven to slightly negative.

2021 Guidance Update

For the full year of 2021, CIRCOR now expects organic revenue growth in the range of 2 to 4% (previously 0 to 4%) and Adjusted EPS of $2.10 to $2.30 (previously $2.00 to $2.20). This updated guidance reflects our latest view of the Industrial business, which is now expected to grow low to mid-single digits, and increased confidence in our Aerospace & Defense outlook. We continue to expect adjusted net income to free cash flow conversion to be 85% to 95% and will use 2021 free cash flow to deleverage CIRCOR.

Presentation slides that provide supporting information to this guidance and first-quarter results are posted on the “Investors” section of the Company’s website and will be discussed during the conference call at 9:00 a.m. ET today.

Conference Call Information

CIRCOR International will hold a conference call to review its financial results at 9:00 a.m. ET today, May 12, 2021. To listen to the live conference call and view the accompanying presentation slides, please visit “Webcasts & Presentations” in the “Investors” portion of CIRCOR’s website. The live call also can be accessed by dialing (877) 407-5790 or (201) 689-8328. Participants are encouraged to dial in to the call at least 15 minutes prior to the start time. The webcast will be archived on the Company’s website for one year.

Selected Preliminary Consolidated Results
	($ millions except EPS)		Q1 2021				Q1 2020				Change
	Revenue		$

FAQ

What are CIRCOR's Q1 2021 financial results for CIR?

CIRCOR reported Q1 2021 revenue of $181 million, down 6% year-over-year, with a GAAP loss per share of $(0.35) and adjusted EPS of $0.24.

What is CIRCOR's guidance for Q2 2021?

CIRCOR expects Q2 2021 revenue to increase by 0-2% and organic revenue to decline by (2)-(4)%.

How much backlog does CIRCOR have as of Q1 2021?

CIRCOR has a backlog of $421 million as of Q1 2021.

What is CIRCOR's adjusted EPS guidance for the full year 2021?

CIRCOR expects adjusted EPS for the full year 2021 to be in the range of $2.10 to $2.30.