CIRCOR International, Inc. (NYSE:CIR) Q3 2019 Earnings Conference Call - Final Transcript

Nov 06, 2019 • 09:00 am ET


CIRCOR International, Inc. (NYSE:CIR) Q3 2019 Earnings Conference Call - Final Transcript


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Good day, ladies and gentlemen, welcome to CIRCOR International's Third Quarter Fiscal Year 2019 Financial Results Conference Call. Today's call will be recorded. [Operator Instructions] I'll now turn the call over to Mr. David Mullen from CIRCOR for opening remarks and introductions. Please go ahead.

David Mullen

Thank you, and good morning, everyone. On the call today is Scott Buckhout, CIRCOR's President and CEO; and Chadi Chahine, the company's Chief Financial Officer. The results presented today are considered preliminary as the company has not completed its review procedures related to reporting discontinued operations and related impairments and associated tax effects. As the company completes its review, material adjustments may arise between today and the date the company files with the Securities and Exchange Commission its quarterly report on Form 10-Q for the quarter ended September 29, 2019. The slides we'll be referring to today are available on CIRCOR's website at on the Webcasts & Presentations section of the Investors link.

Please turn to Slide 2. Today's discussion contains forward-looking statements that identify future expectations. These expectations are subject to known and unknown risks, uncertainties and other factors. For a full discussion of these factors, the company advises you to review CIRCOR's Form 10-K, 10-Qs and other SEC filings. The company's filings are available on its website at Actual results could differ materially from those anticipated or implied by today's remarks. Any forward-looking statements only represent the company's view as of today, November 6, 2019. While CIRCOR may choose to update these forward-looking statements at a later date, the company specifically disclaims any duty to do so.

On today's call, management will refer to adjusted operating income, adjusted operating margins, adjusted net income, adjusted EPS, free cash flow and organic measures. These non-GAAP metrics exclude certain special charges and recoveries. The reconciliation of CIRCOR's non-GAAP measures to the comparable GAAP measures are available in the financial tables of the earnings press release on CIRCOR's website.

I'll now turn the call over to Scott. Please turn to Slide 3.

Scott A. Buckhout

Thank you, Dave, and good morning, everyone. In June, we communicated our detailed 18-month plan for delivering significant shareholder value. I'm pleased to report that our Q3 results and our outlook for Q4 are right on track to that plan. We'll talk more about the progress we've made delivering our strategic plan, but first, let me recap our results.

As you may recall, following the diversity of our Engineered Valves business in July and the announcement of our intent to divest our Distributed Valves business in October, we started reporting both businesses as discounted operations. Including the impact of Distributed Valves in the quarter, consistent with our guidance, we delivered a solid Q3 with $252 million of revenue and $0.48 of adjusted EPS. From continuing operations, excluding divestitures, sales in the quarter were $234 million, up 7% organically. Adjusted EPS was $0.63. Adjusted operating margin was 11%, up 160 basis points versus last year. We delivered $218 million of orders in the quarter, down