CIR CIRCOR International Inc

CIRCOR International, Inc. (NYSE: CIR), a provider of valves and other highly engineered products and subsystems that control the flow of fluids safely and efficiently in the aerospace, energy and industrial markets, today announced financial results for the third quarter ended September 27, 2009.

Comments on the Third Quarter

According to Chairman and Chief Executive Officer Bill Higgins, “Our third-quarter revenues were slightly above our guidance range. Earnings significantly exceeded our guidance range primarily due to lower-than-expected asbestos charges and other non-operating gains.”

“As expected, bookings reflected the weak global demand environment and came in 13% lower year-over-year,” Higgins said. “Our Energy segment continued to experience a significant decrease in short-cycle bookings due to the substantial decline in rig counts and destocking at distributors. At the same time, our long-cycle international project business experienced an increase in year-over-year bookings due to very low orders booked in the third quarter of 2008. Within our Instrumentation and Thermal Fluid Controls segment we experienced continued weakness, particularly in commercial aerospace, although we did see signs of stabilization in some of our other diverse flow markets.”

“To adjust to this difficult market environment, we continue to focus on our quality of earnings initiatives by reducing our cost structure, driving operational improvements with Lean, and expanding our low-cost operations in emerging markets,” Higgins said. “Excluding acquisitions, we have reduced CIRCOR’s total workforce by approximately 17% year-to-date, and we continue to consolidate facilities.”

“We have a great balance sheet and continue to seek strategic acquisitions,” added Higgins. “We recently acquired Pipeline Engineering, a privately held pipeline products and solutions company based in the United Kingdom. This acquisition will be accretive in the first year and was funded with existing cash.”

Consolidated Results

Revenues for the third quarter of 2009 were $144.3 million, a 31% decrease from $208.7 million generated in the third quarter of 2008. Net income for the third quarter of 2009 declined to $8.4 million, or $0.49 per diluted share, compared with $19.8 million, or $1.16 per diluted share, for the third quarter of 2008. Third-quarter 2009 net income includes $2.0 million in pre-tax asbestos charges compared with $3.8 million in the third quarter of 2008. Third-quarter 2009 net income also includes a benefit of $0.5 million related to an acquisition completed earlier in the year, where the fair value of the acquired assets exceeded the purchase price.

For the nine months ended September 27, 2009, revenues were $484.5 million, a decrease of 18% from $591.9 million for the comparable period in 2008. Net income for the first nine months of 2009 was $26.6 million, or $1.56 per diluted share, a decrease of 48% from $51.1 million, or $3.01 per diluted share, from the first nine months of 2008. Net income for the first nine months of 2009 includes $13.7 million in pre-tax asbestos charges compared with $6.9 million in the year-ago period. Net income for the first nine months of 2009 also includes a pre-tax gain of $1.7 million related to proceeds from the sale of land use rights and the aforementioned benefit associated with the acquisition, recorded as a gain on the “special charges” line.

The Company received orders totaling $143.6 million during the third quarter of 2009, a decrease of 13% compared with the third quarter of 2008 and a 15% sequential decrease compared with the second quarter of 2009.

For the first nine months of 2009, orders totaled $434.8 million with a third-quarter 2009 ending backlog of $297.9 million. This compares to 2008 orders for the first nine months of $599.2 million and a third quarter 2008 ending backlog of $401.6 million, representing a year-over-year decrease of 26%.

During the third quarter of 2009, the Company generated $11.2 million of free cash flow (defined as net cash from operating activities, less capital expenditures and dividends paid), and, for the first nine months of 2009, the Company had free cash flow of $21.2 million. This compares to $24.1 million of free cash flow generated in the first nine months of 2008.

Instrumentation and Thermal Fluid Controls Products

CIRCOR’s Instrumentation and Thermal Fluid Controls Products segment revenues decreased 14% to $83.1 million from $96.3 million in the third quarter of 2008. Growth from acquisitions of 4% was more than offset by volume declines of 14% and lower foreign exchange rates compared to the U.S. dollar of 3%. Incoming orders for this segment were $88.4 million for the third quarter of 2009, a decrease of 13% from $101.6 million in the third quarter of 2008. Sequentially, this segment’s orders decreased 8%. The sequential decrease in orders in this segment related primarily to a large multi-year military landing gear order booked in the second quarter of 2009 expected to be shipped beginning in 2011. Ending backlog was $183.7 million, an increase of 8% from the third quarter of fiscal 2008 and a 3% increase from the second quarter of fiscal 2009.

This segment’s adjusted operating margin, which excludes the impact of special and asbestos charges, for the third quarter of 2009 was 11.6% compared with 12.3% in the third quarter of 2008, and 11.8% in the second quarter of 2009. The year-over-year and sequential declines were due to lower sales leverage and unfavorable foreign currency adjustments, partially offset by a decrease in material costs and labor expenses.

Energy Products

CIRCOR’s Energy Products segment revenues declined by 46% to $61.2 million for the quarter ended September 27, 2009 compared with a record $112.4 million in the quarter ended September 28, 2008. The year-over-year decrease included volume declines of 44%, as well as unfavorable foreign currency adjustments of 2%.

Incoming orders for the third quarter of 2009 were $55.1 million, a decrease of 12% from $62.7 million in the third quarter of 2008, and a decrease of 24% from $72.9 million in the second quarter of 2009. The sequential decrease was the result of large international project orders booked in the second quarter of 2009 scheduled to ship in 2010. Ending backlog totaled $114.1 million, a 51% decrease compared with $232.0 million at the end of the third quarter of 2008, and a 6% decrease sequentially.

The Energy Products segment’s adjusted operating margin was 10.9% during the third quarter of 2009 compared with 23.2% for the third quarter of 2008 and 12.3% for the second quarter of 2009. The year-over-year decrease was primarily the result of lower volume, unfavorable pricing and product mix, as well as acquisition-related costs, partially offset by lower material costs and labor expenses.

Business and Financial Outlook

“We believe that the ongoing global recession will continue to negatively affect our financial results for the fourth quarter and into 2010,” said Higgins. “In Energy, while there appears to be some stabilization in rig counts, it is difficult to determine whether this will be sustainable and how long it will take for distributors to work through excess inventory. Quoting activity continues on large international project orders, although pricing pressure has increased. Visibility into the Instrumentation and Thermal Fluid Controls Products side of the business is also limited, although we have seen areas of improvement in certain markets.”

“We continue to take aggressive actions to lower our cost structure and enhance our quality of earnings, including plant consolidations and increasing the use of India and China for materials sourcing. We anticipate incurring expenses in a range of $2.0 million to $2.5 million in the fourth quarter relating to certain cost-reduction activities. With a lower cost structure that is aligned with near term demand, we will be well positioned for bottom line improvement as our markets begin to recover. We also plan to leverage our strong balance sheet and cash generating ability to capitalize on acquisition opportunities as they present themselves,” concluded Higgins.

The Company currently expects revenues for the fourth quarter of 2009 in the range of $153 million to $162 million and earnings, excluding special charges, to be in the range of $0.17 to $0.23 per diluted share.

Conference Call Information

CIRCOR’s Chief Executive Officer, Bill Higgins, and Chief Financial Officer, Fred Burditt, will host a conference call live on Thursday, October 29, at 9:00 a.m. ET to discuss the financial results. Those who wish to listen to the conference call and view the accompanying presentation slides should visit “Webcasts & Presentations” in the “Investor Relations” portion of the CIRCOR website. The live call also can be accessed by dialing (877) 407-5790 or (201) 689-8328. If you are unable to listen to the live call, the webcast will be archived on the Company’s website.

Use of Non-GAAP Financial Measures

Adjusted net income, adjusted earnings per diluted share, adjusted operating margin, and free cash flow, are non-GAAP financial measures and are intended to serve as a complement to results provided in accordance with accounting principles generally accepted in the United States. CIRCOR believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Reliance should not be placed on forward-looking statements because they involve both known and unknown risks, uncertainties and other factors, which are, in some cases, beyond the control of CIRCOR. Any statements in this press release that are not statements of historical fact are forward-looking statements, including, but not limited to, those relating to prospects for both the Energy and Instrumentation and Thermal Fluid Controls segments; taking aggressive actions to lower its cost structure and enhance quality of earnings, including plant consolidations and increasing the use of India and China for materials sourcing; incurring expenses in a range of $2.0 million to $2.5 million in the fourth quarter; anticipating bottom line improvement as its markets begin to recover; and leveraging its strong balance sheet and cash generating ability to capitalize on acquisition opportunities as they present themselves; expectations regarding the Pipeline Engineering acquisition, and CIRCOR’s future performance, including fourth-quarter revenue and earnings guidance. Actual events, performance or results could differ materially from the anticipated events, performance or results expressed or implied by such forward-looking statements. BEFORE MAKING ANY INVESTMENT DECISIONS REGARDING OUR COMPANY, WE STRONGLY ADVISE YOU TO READ THE SECTION ENTITLED "RISK FACTORS" IN OUR MOST RECENT ANNUAL REPORT ON FORM 10-K, WHICH CAN BE ACCESSED UNDER THE "INVESTORS" LINK OF OUR WEBSITE AT WWW.CIRCOR.COM. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

About CIRCOR International, Inc. CIRCOR International, Inc. provides valves and other highly engineered products and subsystems that control the flow of fluids safely and efficiently in the aerospace, energy and industrial markets. With more than 9,000 customers in over 100 countries, CIRCOR has a diversified product portfolio with recognized, market-leading brands. CIRCOR’s strategy includes growing organically by investing in new, differentiated products; adding value to component products; and increasing the development of mission-critical subsystems. The Company also plans to leverage its strong balance sheet to acquire complementary businesses.

CIRCOR INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) UNAUDITED                         Three Months Ended Nine Months Ended September 27, 2009 September 28, 2008 September 27, 2009 September 28, 2008     Net revenues $ 144,327 $ 208,680 $ 484,509 $ 591,860 Cost of revenues   102,462     141,369     338,123     402,752   GROSS PROFIT 41,865 67,311 146,386 189,108 Selling, general and administrative expenses 29,787 34,489 98,127 106,041 Asbestos charges 1,977 3,808 13,682 6,893 Special charges (recoveries)   (543 )   -     (1,678 )   160   OPERATING INCOME   10,644     29,014     36,255     76,014   Other (income) expense: Interest income (77 ) (447 ) (391 ) (954 ) Interest expense 471 265 857 894 Other (income) expense, net   (959 )   11     (1,409 )   660   Total other (income) expense   (565 )   (171 )   (943 )   600   INCOME BEFORE INCOME TAXES 11,209 29,185 37,198 75,414 Provision for income taxes   2,804     9,412     10,601     24,321   NET INCOME $ 8,405   $ 19,773   $ 26,597   $ 51,093     Earnings per common share: Basic $ 0.49 $ 1.17 $ 1.56 $ 3.04 Diluted $ 0.49 $ 1.16 $ 1.56 $ 3.01   Weighted average common shares outstanding: Basic 17,023 16,853 17,003 16,789 Diluted 17,116 17,068 17,050 17,000 CIRCOR INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) UNAUDITED                 Nine Months Ended September 27, 2009 September 28, 2008     OPERATING ACTIVITIES Net income $ 26,597 $ 51,093 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 9,620 8,852 Amortization 1,956 2,012 Compensation expense of stock-based plans 2,351 3,428 Tax effect of share based compensation 412 (2,510) Loss on sale of assets held for sale - 1 Gain on disposal of property, plant and equipment (60) (93)   Changes in operating assets and liabilities, net of effects from business acquisitions: Trade accounts receivable 30,690 (36,689) Inventories 40,836 (3,233) Prepaid expenses and other assets 8,546 (1,794) Accounts payable, accrued expenses and other liabilities (91,717) 15,091 Net cash provided by operating activities 29,231 36,158   INVESTING ACTIVITIES Additions to property, plant and equipment (6,106) (10,162) Proceeds from disposal of property, plant and equipment 95 202 Proceeds from sale of assets held for sale - 311 Purchase of ST investments (278,916) (155,786) Proceeds from sale of ST investments 312,918 134,044 Business acquisitions, net of cash acquired (10,428) (7,263) Net cash (used in) provided by investing activities 17,563 (38,654)   FINANCING ACTIVITIES Proceeds from debt borrowings 57,372 86,495 Payments of debt (64,703) (86,358) Debt Issuance Costs (2,814) - Dividends paid (1,930) (1,888) Proceeds from the exercise of stock options 37 2,342 Tax effect of share based compensation (412) 2,510 Net cash (used in) provided by financing activities (12,450) 3,101 Effect of exchange rate changes on cash and cash equivalents 1,891 (90)   INCREASE IN CASH AND CASH EQUIVALENTS 36,235 515 Cash and cash equivalents at beginning of year 47,473 34,662 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 83,708 $ 35,177 CIRCOR INTERNATIONAL, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share data) UNAUDITED                       September 27, 2009 December 31, 2008   ASSETS Current Assets: Cash & cash equivalents $ 83,708 $ 47,473 Short-term investments 3,023 34,872 Trade accounts receivable, less allowance for doubtful accounts of $ 2,035 and $1,968, respectively 113,800 134,731 Inventories 150,276 183,291 Prepaid expenses and other current assets 6,696 3,825 Deferred income taxes 14,712 12,396 Insurance receivable 6,485 6,081 Assets held for sale   543   1,015 Total Current Assets   379,243   423,684   Property, Plant and Equipment, net 87,696 82,843   Other Assets: Goodwill 32,976 32,092 Intangibles, net 46,885 42,123 Non-current insurance receivable - 4,684 Other assets   4,674   2,597 Total Assets $ 551,474 $ 588,023   LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $ 50,636 $ 94,421 Accrued expenses and other current liabilities 42,997 69,948 Accrued compensation and benefits 18,603 22,604 Asbestos liability 11,605 9,310 Income taxes payable 5,337 9,873 Notes payable and current portion of long-term debt   131   622 Total Current Liabilities   129,309   206,778   Long-Term Debt, net of current portion 9,519 12,528 Deferred Income Taxes 6,551 3,496 Long-Term Asbestos Liability 12,070 9,935 Other Non-Current Liabilities 22,297 21,664 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 16,974,920 and 16,898,497 issued and outstanding, respectively 170 169 Additional paid-in capital 244,573 247,196 Retained earnings 107,177 83,106 Accumulated other comprehensive income   19,808   3,151 Total Shareholders' Equity   371,728   333,622 Total Liabilities and Shareholders' Equity $ 551,474 $ 588,023 CIRCOR INTERNATIONAL, INC. SUMMARY OF ORDERS AND BACKLOG (in thousands) UNAUDITED                           Three Months Ended Nine Months Ended

September 27,2009

September 28,2008

September 27,2009

September 28,2008

  ORDERS Instrumentation & Thermal Fluid Controls $ 88,449 $ 101,593 $ 260,974 $ 313,760   Energy Products   55,103   62,689   173,809   285,426   Total orders $ 143,552 $ 164,282 $ 434,783 $ 599,186          

September 27,2009

September 28,2008

  BACKLOG Instrumentation & Thermal Fluid Controls $ 183,733 $ 169,554   Energy Products   114,139   232,022   Total backlog $ 297,872 $ 401,576         Note: Backlog includes all unshipped customer orders. CIRCOR INTERNATIONAL, INC. SUMMARY REPORT BY SEGMENT (in thousands, except earnings per share) UNAUDITED                                             2008   2009 1ST QTR   2ND QTR   3RD QTR   4TH QTR   YTD       1ST QTR   2ND QTR   3RD QTR   YTD   NET REVENUES   Instrumentation & Thermal Fluid Controls (TFC) $ 88,450 $ 98,867 $ 96,298 $ 94,499 $ 378,114 $ 86,340 $ 87,721 $ 83,142 $ 257,203 Energy Products   88,125     107,738     112,382     107,457     415,702     89,307     76,814     61,185     227,306   Total   176,575     206,605     208,680     201,956     793,816     175,647     164,535     144,327     484,509   Total ADJUSTED OPERATING MARGIN   Instrumentation & TFC (excl. special & asbestos charges) 12.5 % 12.6 % 12.3 % 11.2 % 12.1 % 12.9 % 11.8 % 11.6 % 12.1 % Energy Products (excl. special charges) 16.2 % 20.4 % 23.2 % 20.1 % 20.2 % 18.1 % 12.3 % 10.9 % 14.2 % Segment operating income (excl. special & asbestos charges) 14.4 % 16.6 % 18.1 % 15.9 % 16.3 % 15.5 % 12.1 % 11.3 % 13.1 % Corporate expenses (excl. special & asbestos charges) -2.6 % -2.4 % -2.4 % -3.0 % -2.6 % -3.1 % -3.4 % -3.0 % -3.1 % Adjusted Operating Income 11.7 % 14.3 % 15.7 % 12.9 % 13.7 % 12.5 % 8.7 % 8.4 % 10.0 % Asbestos charges (attributable to Instrumentation & TFC) -0.6 % -1.0 % -1.8 % -0.7 % -1.0 % -4.7 % -2.1 % -1.4 % -2.8 % Special (charges) recoveries -0.1 % 0.0 % 0.0 % -70.0 % -17.8 % 0.6 % 0.0 % 0.4 % 0.3 % Total operating margin 11.0 % 13.3 % 13.9 % -57.8 % -5.1 % 8.4 % 6.6 % 7.4 % 7.5 %   ADJUSTED OPERATING INCOME   Instrumentation & TFC (excl. special & asbestos charges) 11,069 12,451 11,803 10,558 45,881 11,116 10,389 9,658 31,163 Energy Products (excl. special charges)   14,303     21,938     26,023     21,556     83,820     16,169     9,461     6,696     32,326   Segment operating income (excl. special & asbestos charges) 25,372 34,389 37,826 32,114 129,701 27,285 19,850 16,354 63,489 Corporate expenses (excl. special & asbestos charges)   (4,628 )   (4,890 )   (5,001 )   (6,042 )   (20,561 )   (5,365 )   (5,589 )   (4,276 )   (15,230 ) Adjusted Operating Income   20,744     29,499     32,825     26,072     109,140     21,920     14,261     12,078     48,259   Asbestos charges (attributable to Instrumentation & TFC) (1,075 ) (2,009 ) (3,810 ) (1,417 ) (8,311 ) (8,263 ) (3,442 ) (1,977 ) (13,682 ) Special (charges) recoveries (160 ) - - (141,297 ) (141,457 ) 1,135 - 543 1,678                   Total operating income 19,509 27,490 29,015 (116,642 ) (40,628 ) 14,792 10,819 10,644 36,255   INTEREST (EXPENSE) INCOME, NET (145 ) 23 182 120 180 (32 ) (41 ) (394 ) (467 ) OTHER (EXPENSE) INCOME, NET   (401 )   (248 )   (11 )   390     (270 )   183     267     959     1,409     PRETAX INCOME 18,963 27,265 29,186 (116,132 ) (40,718 ) 14,943 11,045 11,209 37,197 PROVISION FOR INCOME TAXES   (6,068 )   (8,840 )   (9,413 )   6,024     (18,297 )   (4,483 )   (3,313 )   (2,804 )   (10,600 ) EFFECTIVE TAX RATE 32.0 % 32.4 % 32.3 % 5.2 % -44.9 % 30.0 % 30.0 % 25.0 % 28.5 % NET INCOME $ 12,895   $ 18,425   $ 19,773   $ (110,108 ) $ (59,015 ) $ 10,460   $ 7,732   $ 8,405   $ 26,597     Weighted Average Common Shares Outstanding (Diluted) 16,872 17,053 17,068 16,897 16,817 17,014 17,066 17,116 17,050   EARNINGS PER COMMON SHARE (Diluted) $ 0.76   $ 1.08   $ 1.16   $ (6.52 ) $ (3.51 ) $ 0.61   $ 0.45   $ 0.49   $ 1.56     EBIT $ 19,108 $ 27,242 $ 29,004 $ (116,252 ) $ (40,898 ) $ 14,975 $ 11,086 $ 11,603 $ 37,664 Depreciation 2,874 2,977 3,001 2,696 11,548 2,839 3,245 3,536 9,620 Amortization of intangibles   656     676     680     613     2,625     622     627     707     1,956   EBITDA $ 22,638   $ 30,895   $ 32,685   $ (112,943 ) $ (26,725 ) $ 18,436   $ 14,958   $ 15,846   $ 49,240     EBITDA AS A PERCENT OF SALES   12.8 %   15.0 %   15.7 %   -55.9 %   -3.4 %   10.5 %   9.1 %   11.0 %   10.2 %   CAPITAL EXPENDITURES $ 2,851   $ 3,433   $ 3,878   $ 4,810   $ 14,972   $ 2,576   $ 1,925   $ 1,605   $ 6,106   CIRCOR INTERNATIONAL, INC. RECONCILIATION OF KEY PERFORMANCE MEASURES TO COMMONLY USED GENERALLY ACCEPTED ACCOUNTING PRINCIPLE TERMS (in thousands) UNAUDITED                           2008 2009     1ST QTR   2ND QTR   3RD QTR   4TH QTR   YTD   1ST QTR   2ND QTR   3RD QTR   YTD                                                   FREE CASH FLOW [NET CASH FLOW FROM OPERATING ACTIVITIES   LESS CAPITAL EXPENDITURES LESS DIVIDENDS PAID]   $ (5,366 )   $ 31,536     $ (2,062 )   $ 23,216     $ 47,324         $ (7,928 )   $ 17,882     $ 11,241     $ 21,195   ADD: Capital expenditures 2,851 3,433 3,878 4,810 14,972 2,576 1,925 1,605 6,106 Dividends paid   626     631     631     634     2,522     657     637     636     1,930     NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (1,889 ) $ 35,600   $ 2,447   $ 28,660   $ 64,818   $ (4,695 ) $ 20,444   $ 13,482   $ 29,231      

 

                                          NET (CASH) DEBT [TOTAL DEBT LESS CASH & CASH EQUIVALENTS LESS INVESTMENTS]   $ (21,709 )   $ (46,796 )   $ (42,029 )   $ (69,195 )   $ (69,195 )       $ (49,519 )   $ (69,331 )   $ (77,081 )   $ (77,081 ) ADD: Cash & cash equivalents 42,690 38,835 35,177 47,473 47,473 36,113 33,038 83,708 83,708 Investments   4,036     31,590     29,376     34,872     34,872     36,991     48,344     3,023     3,023     TOTAL DEBT $ 25,017   $ 23,629   $ 22,524   $ 13,150   $ 13,150   $ 23,585   $ 12,051   $ 9,650   $ 9,650                                                   DEBT AS % OF EQUITY     6 %     5 %     5 %     4 %     4 %         7 %     3 %     3 %     3 %   TOTAL DEBT 25,017 23,629 22,524 13,150 13,150 23,585 12,051 9,650 9,650   TOTAL SHAREHOLDERS' EQUITY 446,379 465,958 470,888 333,622 333,622 341,860 357,596 371,728 371,728                                                 EBIT [NET INCOME LESS INTEREST EXPENSE, NET]   $ 19,108     $ 27,242     $ 29,004     $ (116,252 )   $ (40,898 )       $ 14,975     $ 11,086     $ 11,603     $ 37,664   LESS: Interest expense, net (145 ) 23 182 120 180 (32 ) (41 ) (394 ) (467 ) Provision for income taxes   (6,068 )   (8,840 )   (9,413 )   6,024     (18,297 )   (4,483 )   (3,313 )   (2,804 )   (10,600 )   NET INCOME $ 12,895   $ 18,425   $ 19,773   $ (110,108 ) $ (59,015 ) $ 10,460   $ 7,732   $ 8,405   $ 26,597                                                   EBITDA [NET INCOME LESS INTEREST EXPENSE, NET LESS DEPRECIATION LESS AMORTIZATION LESS TAXES]   $ 22,638     $ 30,895     $ 32,685     $ (112,943 )   $ (26,725 )       $ 18,436     $ 14,958     $ 15,846     $ 49,240   LESS: Interest expense, net (145 ) 23 182 120 180 (32 ) (41 ) (394 ) (467 ) Depreciation (2,874 ) (2,977 ) (3,001 ) (2,696 ) (11,548 ) (2,839 ) (3,245 ) (3,536 ) (9,620 ) Amortization (656 ) (676 ) (680 ) (613 ) (2,625 ) (622 ) (627 ) (707 ) (1,956 ) Provision for income taxes   (6,068 )   (8,840 )   (9,413 )   6,024     (18,297 )   (4,483 )   (3,313 )   (2,804 )   (10,600 )   NET INCOME $ 12,895   $ 18,425   $ 19,773   $ (110,108 ) $ (59,015 ) $ 10,460   $ 7,732   $ 8,405   $ 26,597                                                   ADJUSTED INCOME, EXCLUDING SPECIAL CHARGES, NET OF TAX         $ 13,004     $ 18,425     $ 19,773     $ 19,026     $ 70,228         $ 9,666     $ 7,732     $ 8,000     $ 25,398   LESS: Special (charges) recoveries, net of tax (109 ) - - (129,134 ) (129,243 ) 794 - 405 1,199   NET INCOME $ 12,895   $ 18,425   $ 19,773   $ (110,108 ) $ (59,015 ) $ 10,460   $ 7,732   $ 8,405   $ 26,597                                                     ADJUSTED WEIGHTED AVERAGE SHARES           16,872       17,053       17,068       17,010       17,005           17,014       17,066       17,116       17,050     Adjustment for anti-dilutive conversion of shares - - - 113 188 - - -

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                    Weighted average common shares outstanding (diluted)   16,872     17,053     17,068     16,897     16,817     17,014     17,066     17,116     17,050                                                   ADJUSTED EARNINGS PER SHARE EXCLUDING SPECIAL CHARGES, NET OF TAX         $ 0.77     $ 1.08     $ 1.16     $ 1.12     $ 4.13         $ 0.57     $ 0.45     $ 0.47     $ 1.49     LESS: Special (charges) recoveries, net of tax impact on EPS $ (0.01 ) $ - $ - $ (7.64 ) $ (7.64 ) $ 0.05 $ - $ 0.02 $ 0.07                     EARNINGS PER COMMON SHARE (Diluted) $ 0.76   $ 1.08   $ 1.16   $ (6.52 ) $ (3.51 ) $ 0.61   $ 0.45   $ 0.49   $ 1.56