Circor International (CIR) 8-K CIRCOR Announces First Quarter Results

EXHIBIT 99.1

PRESS RELEASE

Contact:	Kenneth Smith
	Chief Financial Officer
	CIRCOR International, Inc.
	781-270-1200

CIRCOR Announces First Quarter Results

• Net earnings of $0.32 posted for quarter

• Robust energy markets help lift total orders 82% and backlog 69% to record levels

• Operational improvements being implemented to improve production throughput and increase capacity

BURLINGTON, MA, May 1, 2006

CIRCOR International, Inc. [NYSE:CIR] a leading provider of valves and other fluid control devices for the instrumentation, aerospace, thermal fluid and energy markets, today announced results for its first quarter ended April 2, 2006.

Revenues for the first quarter were $127.3 million, an increase of 25% from $102.2 million for the first quarter 2005. Net income for the first quarter 2006 was $5.2 million, or $0.32 per diluted share, equal to the results for the 2005 first quarter. The earnings per share for the first quarter 2006 includes a $0.01 charge for the adoption of FAS 123R, the expensing of stock options.

The Company received orders totaling a record $203.2 million during the first quarter 2006, an increase of 82% over the same period in 2005. Backlog at March-end 2006 reached another record of $241.3 million, up 69% over March 2005 backlogs and sequentially increasing 70% over the fourth quarter of 2005. Excluding acquisitions completed during the past 12 months, orders increased 54% and backlogs rose 31% compared to first quarter 2005.

During the first quarter 2006, the Company’s free cash flow was a use of $5.2 million (defined as net cash used in operating activities, less capital expenditures and dividends paid) and included an investment in higher inventory to support the record backlog. The acquisitions of Sagebrush Pipeline Equipment Company and Hale-Hamilton during the first quarter 2006 used a combined $61 million in cash, resulting in the Company having an 18% net debt to total capitalization ratio at the end of the first quarter.

CIRCOR’s Instrumentation and Thermal Fluid Controls Products segment revenues increased 19% to $72.4 million compared to $61.0 million in the first quarter 2005 primarily due to acquisitions. Incoming orders for this segment increased 31% to $87.3 million compared to the

first quarter last year and backlogs increased 76% compared to March-end 2005 as a result of acquisitions and growth at existing businesses. This segment’s operating margin for the first quarter decreased to 9.1% as production and supply issues that arose during the second half of 2005 continue to be resolved.

CIRCOR’s Energy Products segment revenues increased 33% to $54.9 million from $41.2 million in the first quarter last year, primarily due to organic sales growth to oil and gas markets. Including acquisitions, incoming orders for the quarter rose 155% to $116.0 million compared to the same period last year and ending backlog totaled $130.6 million, an increase of 63% compared to March-end 2005, both representing records for this segment. These orders and backlog figures include approximately $30 million of the $50 million of letters of intent received for major international natural gas projects as of year-end 2005, which were converted into purchase orders in the first quarter. The remaining $20 million of these letters of intent are expected to be processed and recorded as orders during the second quarter 2006. Worldwide market conditions for oil and gas projects continue to be strong. This segment’s operating margin grew 240 basis points to 10.4% for the first quarter of 2006, compared to the same period last year.

David A. Bloss, Sr., Chairman and Chief Executive Officer, said, “We are pleased with how our markets are performing and our record level of orders and backlog. The extremely strong oil and gas market and the success of our acquisition efforts have contributed significantly to our growth this past quarter. We remain concentrated on improving our bottom line profit performance and have implemented many changes to correct our internal processes, upgrade management and improve our supplier performance, particularly within our Instrumentation and Thermal Fluid Controls Segment. These actions will continue during the second quarter and should result in an improvement in our operating performance during the second half of 2006.”

CIRCOR provided guidance for its second quarter 2006 results, indicating it expects earnings to be in the range of $0.37 to $0.39 per diluted share excluding special charges but including a non-cash charge of approximately $0.01 per diluted share for the adoption of FAS 123R relating to expensing of stock options.

CIRCOR International has scheduled a conference call to review its results for the first quarter 2006 on Tuesday, May 2, 2006 at 9:00 a.m. ET. Interested parties may access the call by dialing (800) 946-0720 for US & Canada and (719) 457-2646 for International locations. A replay of the call will be available from 12:00 noon ET on May 2, 2006 through midnight on Monday, May 8, 2006. To access the replay, interested parties can dial (888) 203-1112 or (719) 457-0820 and enter confirmation code #1149621 when prompted. The presentation slides that will be discussed in the conference call are expected to be available on Monday, May 1, 2006 by 6:00 p.m. ET. The presentation slides may be downloaded from the Quarterly Earnings page of the Investors section on the CIRCOR Website:http://www.CIRCOR.com. An audio recording of the conference call also is expected to be posted on the Company’s website by May 5, 2006.

CIRCOR International, Inc. is a leading provider of valves and fluid control products that allow customers around the world to use fluids safely and efficiently in the instrumentation, aerospace, thermal fluid and energy markets. CIRCOR’s executive headquarters are located at 25 Corporate Drive, Burlington, MA 01803.

This press release contains certain statements that are “forward-looking statements” as that term is defined under the Private Securities Litigation Reform Act of 1995 (the “Act”) and releases issued by the Securities and Exchange Commission (SEC). The words “may,” “hope,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential,” “continue,” and other expressions which are predictions of or indicate future events and trends and which do not relate to historical matters identify forward-looking statements. We believe that it is important to communicate our future expectations to our stockholders, and we, therefore, make forward-looking statements in reliance upon the safe harbor provisions of the Act. However, there may be events in the future that we are not able to accurately predict or control, and our actual results, performance or achievements may differ materially from the expectations we describe in our forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the cyclicality and highly competitive nature of some of our end markets, changes in the price of and demand for oil and gas in both domestic and international markets, variability of raw material and component pricing, fluctuations in foreign currency exchange rates, and our ability to continue operating our manufacturing facilities at efficient levels and to successfully implement our acquisition strategy. We advise you to read further about these and other risk factors set forth under the caption “Certain Risk Factors That May Affect Future Results” in our SEC filings. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

CIRCOR INTERNATIONAL, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

UNAUDITED

	April 2, 2006		December 31, 2005
ASSETS
Current Assets:
Cash and cash equivalents	$	27,069	$	31,112
Trade accounts receivable, less allowance for doubtful accounts of $2,126 and $1,943 respectively		84,298		77,731
Inventories		123,429		107,687
Prepaid expenses and other current assets		7,323		3,791
Deferred income taxes		4,773		4,328
Assets held for sale		3,171		1,115
Total Current Assets		250,063		225,764
Property, Plant and Equipment, net		71,581		63,350
Other Assets:
Goodwill		168,611		140,179
Intangibles, net		31,223		20,941
Other assets		18,843		10,146
Total Assets	$	540,321	$	460,380
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	56,711	$	49,736
Accrued expenses and other current liabilities		29,579		26,031
Accrued compensation and benefits		11,501		14,509
Income taxes payable		4,565		3,418
Notes payable and current portion of long-term debt		24,112		27,213
Total Current Liabilities		126,468		120,907
Long-term Debt, Net of Current Portion		71,228		6,278
Deferred Income Taxes		11,954		11,237
Other Noncurrent Liabilities		13,283		11,235
Shareholders’ Equity:
Preferred stock, $.01 par value; 1,000,000 shares authorized; no shares issued and outstanding		—		—
Common stock, $.01 par value; 29,000,000 shares authorized; and 15,895,586 and 15,823,529 issued and outstanding, respectively		159		158
Additional paid-in capital		216,627		215,274
Retained earnings		86,888		82,318
Accumulated other comprehensive income		13,714		12,973
Total Shareholders’ Equity		317,388		310,723
Total Liabilities and Shareholders’ Equity	$	540,321	$	460,380

CIRCOR INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

UNAUDITED

	Three Months Ended
	April 2, 2006			April 3, 2005
Net revenues	$	127,295		$	102,238
Cost of revenues		88,957			69,297
GROSS PROFIT		38,338			32,941
Selling, general and administrative expenses		29,849			24,090
Special charges		—			305
OPERATING INCOME		8,489			8,546
Other (income) expense:
Interest income		(109	)		(85	)
Interest expense		1,133			872
Other expense (income), net		(131	)		(181	)
Total other expense		893			606
INCOME BEFORE INCOME TAXES		7,596			7,940
Provision for income taxes		2,431			2,779
NET INCOME	$	5,165		$	5,161
Earnings per common share:
Basic	$	0.33		$	0.33
Diluted	$	0.32		$	0.32
Weighted average common shares outstanding:
Basic		15,853			15,515
Diluted		16,197			16,054

CIRCOR INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

UNAUDITED

	Three Months Ended
	April 2, 2006			April 3, 2005
OPERATING ACTIVITIES
Net income	$	5,165		$	5,161
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation		2,619			2,597
Amortization		515			38
Compensation expense of stock-based plans		790			206
(Gain) loss on sale of property, plant and equipment		(23	)		7
Equity in undistributed earnings of affiliates		(33	)		(63	)
Changes in operating assets and liabilities, net of effects from business acquisitions:
Trade accounts receivable		2,405			(134	)
Inventories		(6,222	)		(11,697	)
Prepaid expenses and other assets		(2,378	)		(3,892	)
Accounts payable, accrued expenses and other liabilities		(5,878	)		11,619
Net cash (used in) provided by operating activities		(3,040	)		3,842
INVESTING ACTIVITIES
Additions to property, plant and equipment		(1,578	)		(3,668	)
Proceeds from sale of property, plant and equipment		14			—
Proceeds from sale of assets held for sale		100			—
Business acquisition, net of cash acquired		(61,015	)		(34,690	)
Net cash used in investing activities		(62,479	)		(38,358	)
FINANCING ACTIVITIES
Proceeds from long-term borrowings		64,608			2,645
Payments of long-term debt		(3,578	)		(2,374	)
Dividends paid		(595	)		(586	)
Proceeds from the exercise of stock options		297			2,250
Tax effect of share based compensation		368			—
Net cash provided by financing activities		61,100			1,935
Effect of exchange rate changes on cash and cash equivalents		376			(1,130	)
INCREASE IN CASH AND CASH EQUIVALENTS		(4,043	)		(33,711	)
Cash and cash equivalents at beginning of year		31,112			58,653
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	27,069		$	24,942

CIRCOR INTERNATIONAL, INC.

SUMMARY OF ORDERS AND BACKLOG

(in thousands)

UNAUDITED

	Three Months Ended
	April 2, 2006		April 3, 2005
ORDERS
Instrumentation & Thermal Fluid Controls	$	87,264	$	66,434
Energy Products		115,979		45,525
Total orders	$	203,243	$	111,959
	April 2, 2006		December 31, 2005
BACKLOG
Instrumentation & Thermal Fluid Controls	$	110,737	$	84,018
Energy Products		130,605		58,137
Total backlog	$	241,342	$	142,155

Note: Backlog includes all unshipped customer orders.

CIRCOR INTERNATIONAL, INC.

SUMMARY REPORT BY SEGMENT

(in thousands, except earnings per share)

UNAUDITED

	2005															2006
	1ST QTR			2ND QTR			3RD QTR			4TH QTR			YTD			1ST QTR
NET REVENUES
Instrumentation & Thermal Fluid Controls (TFC)	$	61,025		$	62,908		$	59,031		$	68,312		$	251,276		$	72,434
Energy Products		41,213			55,749			50,191			52,102			199,255			54,861
Total		102,238			118,657			109,222			120,414			450,531			127,295
OPERATING MARGIN
Instrumentation & TFC		14.8	%		12.1	%		9.4	%		9.5	%		11.4	%		9.1	%
Energy Products		8.0	%		10.7	%		11.3	%		9.5	%		10.0	%		10.4	%
Segment operating margin		12.0	%		11.5	%		10.3	%		9.5	%		10.8	%		9.7	%
Corporate expenses		-3.4	%		-2.6	%		-3.3	%		-3.2	%		-3.1	%		-3.0	%
Special charges		-0.3	%		-0.1	%		-0.5	%		-0.6	%		-0.4	%		0.0	%
Total operating margin		8.4	%		8.7	%		6.6	%		5.8	%		7.3	%		6.7	%
OPERATING INCOME
Instrumentation & TFC (excl. special & unusual charges)		9,004			7,641			5,532			6,517			28,694			6,595
Energy Products (excl. special & unusual charges)		3,290			5,957			5,680			4,932			19,859			5,702
Segment operating income (excl. special & unusual charges)		12,294			13,598			11,212			11,449			48,553			12,297
Corporate expenses		(3,443	)		(3,105	)		(3,553	)		(3,817	)		(13,918	)		(3,808	)
Special charges		(305	)		(133	)		(496	)		(696	)		(1,630	)		—
Total operating income		8,546			10,360			7,163			6,936			33,005			8,489
INTEREST EXPENSE, NET		(787	)		(667	)		(728	)		(628	)		(2,810	)		(1,024	)
OTHER (EXPENSE) INCOME, NET		181			(204	)		(174	)		53			(144	)		131
PRETAX INCOME		7,940			9,489			6,261			6,361			30,051			7,596
PROVISION FOR INCOME TAXES		(2,779	)		(3,321	)		(1,955	)		(1,613	)		(9,668	)		(2,431	)
EFFECTIVE TAX RATE		35.0	%		35.0	%		31.2	%		25.4	%		32.2	%		32.0	%
NET INCOME	$	5,161		$	6,168		$	4,306		$	4,748		$	20,383		$	5,165
Weighted Average Common Shares Outstanding (Diluted)		16,054			16,171			16,228			16,172			16,019			16,197
EARNINGS PER COMMON SHARE (Diluted)	$	0.32		$	0.38		$	0.27		$	0.29		$	1.27		$	0.32
EARNINGS PER COMMON SHARE (Diluted) excluding special charges	$	0.33		$	0.39		$	0.29		$	0.33		$	1.34		$	0.32
EBIT	$	8,727		$	10,156		$	6,989		$	6,989		$	32,861		$	8,620
Depreciation		2,597			2,586			2,450			2,192			9,825			2,619
Amortization of intangibles		38			227			65			258			588			515
EBITDA	$	11,362		$	12,969		$	9,504		$	9,439		$	43,274		$	11,754
EBITDA AS A PERCENT OF SALES		11.1	%		10.9	%		8.7	%		7.8	%		9.6	%		9.2	%
CAPITAL EXPENDITURES	$	3,668		$	3,136		$	4,649		$	3,568		$	15,021		$	1,578

CIRCOR INTERNATIONAL, INC.

RECONCILIATION OF KEY PERFORMANCE MEASURES TO COMMONLY USED

GENERALLY ACCEPTED ACCOUNTING PRINCIPLE TERMS

(in thousands)

UNAUDITED

	2005															2006
	1ST QTR			2ND QTR			3RD QTR			4TH QTR			YTD			1ST QTR
FREE CASH FLOW [NET CASH FLOW FROM OPERATING ACTIVITIES LESS CAPITAL EXPENDITURES LESS DIVIDENDS PAID]	$	(412	)	$	12,565		$	5,307		$	10,487		$	27,947		$	(5,213	)
ADD:     Capital expenditures		3,668			3,136			4,649			3,568			15,021			1,578
Dividends paid		586			589			590			593			2,358			595
NET CASH PROVIDED BY OPERATING ACTIVITIES	$	3,842		$	16,290		$	10,546		$	14,648		$	45,326		$	(3,040	)
NET (CASH) DEBT [TOTAL DEBT LESS CASH AND CASH EQUIVALENTS LESS INVESTMENTS]	$	15,367		$	10,371		$	2,054		$	2,293		$	2,293		$	68,271
ADD:     Cash and cash equivalents		24,942			29,269			39,154			31,112			31,112			27,069
Investments		4,117			4,026			4,308			86			86			—
TOTAL DEBT	$	44,426		$	43,666		$	45,516		$	33,491		$	33,491		$	95,340
NET DEBT AS % OF NET CAPITALIZATION		4.9	%		3.3	%		0.7	%		0.7	%		0.7	%		17.7	%
NET CAPITALIZATION [TOTAL DEBT PLUS SHAREHOLDERS’ EQUITY LESS CASH AND CASH EQUIVALENTS, LESS INVESTMENTS]	$	313,378		$	310,514		$	309,763		$	313,016		$	313,016		$	385,659
LESS:     Total debt		(44,426	)		(43,666	)		(45,516	)		(33,491	)		(33,491	)		(95,340	)
ADD:     Cash and cash equivalents		24,942			29,269			39,154			31,112			31,112			27,069
Investments		4,117			4,026			4,308			86			86			—
TOTAL SHAREHOLDERS’ EQUITY		298,011			300,143			307,709			310,723			310,723			317,388
ADD:     Total debt		44,426			43,666			45,516			33,491			33,491			95,340
TOTAL CAPITAL	$	342,437		$	343,809		$	353,225		$	344,214		$	344,214		$	412,728
TOTAL DEBT / TOTAL CAPITAL		13.0	%		12.7	%		12.9	%		9.7	%		9.7	%		23.1	%
EBIT    [NET INCOME LESS INTEREST EXPENSE, NET LESS TAXES]	$	8,727		$	10,156		$	6,989		$	6,989		$	32,861		$	8,620
LESS:     Interest expense, net		(787	)		(667	)		(728	)		(628	)		(2,810	)		(1,024	)
Provision for income taxes		(2,779	)		(3,321	)		(1,955	)		(1,613	)		(9,668	)		(2,431	)
NET INCOME	$	5,161		$	6,168		$	4,306		$	4,748		$	20,383		$	5,165
EBITDA [NET INCOME LESS INTEREST EXPENSE, NET LESS DEPRECIATION LESS AMORTIZATION LESS TAXES]	$	11,362		$	12,969		$	9,504		$	9,439		$	43,274		$	11,754
LESS:
Interest expense, net		(787	)		(667	)		(728	)		(628	)		(2,810	)		(1,024	)
Depreciation		(2,597	)		(2,586	)		(2,450	)		(2,192	)		(9,825	)		(2,619	)
Amortization of intangibles		(38	)		(227	)		(65	)		(258	)		(588	)		(515	)
Provision for income taxes		(2,779	)		(3,321	)		(1,955	)		(1,613	)		(9,668	)		(2,431	)
NET INCOME	$	5,161		$	6,168		$	4,306		$	4,748		$	20,383		$	5,165
INCOME EXCLUDING SPECIAL CHARGES [NET INCOME LESS SPECIAL CHARGES, NET OF TAX]	$	5,359		$	6,254		$	4,647		$	5,268		$	21,489		$	5,165
LESS:         Special charges, net of tax		(198	)		(86	)		(341	)		(520	)		(1,106	)		—
NET INCOME	$	5,161		$	6,168		$	4,306		$	4,748		$	20,383		$	5,165
Weighted average common shares outstanding (diluted)		16,054			16,171			16,228			16,172			16,019			16,197
EARNINGS PER SHARE EXCLUDING SPECIAL CHARGES	$	0.33		$	0.39		$	0.29		$	0.33		$	1.34		$	0.32