Item 2.02. Results of Operations and Financial Condition.

By press release dated August 7, 2020, CIRCOR International, Inc. (the "Company") announced its financial results for the three months ended June 28, 2020. The full text of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Item 2.02 of Form 8-K and the Exhibits 99.1 and 99.2 attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities and Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by special reference in such filing.

The Company's management evaluates segment operating performance using operating income before certain charges/credits to cost of revenues and selling, general and administrative expenses, principally associated with acquisition-related activities; restructuring and other costs/income including costs arising from facility consolidations and gains and losses from the sale of product lines; and amortization of acquisition-related intangible assets. The Company also refers to this measure as segment operating income or adjusted operating income. The Company uses this measure because it helps management understand and evaluate the segments' core operating results and facilitates comparison of performance for determining incentive compensation achievement.

In the press release and accompanying supplemental information, the Company uses the following non-GAAP financial measures: adjusted operating income, adjusted operating margin, free cash flow, adjusted net income, adjusted earnings per share (EPS), EBITDA, adjusted EBITDA, net debt, combined financial information, and organic revenue, described as follows:



•      Adjusted operating income is defined as GAAP operating income excluding
       intangible amortization from acquisitions completed subsequent to December
       31, 2011, depreciation and cost of goods sold charges related to step-up
       valuations from acquisitions completed subsequent to December 31, 2016,
       the impact of restructuring related inventory, impairment and special
       charges or gains.



•      Adjusted operating margin is defined as adjusted operating income divided
       by net revenues.



•      Free cash flow is defined as net cash flow from operating activities, less
       net capital expenditures. Management of this Company believes free cash
       flow is an important measure of its liquidity as well as its ability to
       service long-term debt, fund future growth and to provide a return to
       shareholders. We also believe this free cash flow definition does not have
       any material limitations.



•      Adjusted net income is defined as net income, excluding intangible
       amortization from acquisitions completed subsequent to December 31, 2011,
       depreciation and cost of goods sold charges related to step-up valuations
       from acquisitions completed subsequent to December 31, 2016, the impact of
       restructuring related inventory, impairment and special charges or gains,
       net of tax.



•      Adjusted EPS is defined as earnings per common share diluted, excluding
       the per share impact of intangible amortization from acquisitions
       completed subsequent to December 31, 2011, depreciation and cost of goods
       sold charges related to step-up valuations from acquisitions completed
       subsequent to December 31, 2016, the impact of restructuring related
       inventory, impairment and special charges or gains, net of tax.



•      EBITDA is defined as net income plus net interest expense, provision for
       income taxes, depreciation and amortization.



•      Adjusted EBITDA is defined as EBITDA plus the impact of special
       charges/gains including the impact of restructuring related inventory
       charges, cost of goods sold charges related to step-up valuations from
       acquisitions completed subsequent to December 31, 2016, and impairments,
       net of tax.

• Net Debt is defined at total debt minus cash and cash equivalents.





•      Organic growth - the change in revenue and orders excluding the impact of
       acquisitions, divestitures and changes in foreign exchange rates.

Our management uses these non-GAAP measures to gain an understanding of our comparative operating performance (when comparing such results with previous periods or forecasts). These non-GAAP financial measures are used by management in our financial and operating decision making because we believe they reflect our ongoing business and facilitate period-to-

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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 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 peers and 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 incentive 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 our non-GAAP financial measures to the most directly comparable GAAP financial measure is provided in the supplemental information table titled "Reconciliation of Key Performance Measures to Commonly Used Generally Accepted Accounting Principle Terms" which is included as an attachment to the press release in Exhibit 99.1.




Item 9.01  Financial Statements and Exhibits.
(d) Exhibits.



Exhibit No. Description

  99.1      Press Release regarding Earnings
   99.2     Second Quarter 2020 Investor Review Presentation

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