8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): December 2, 2010

FLOW INTERNATIONAL CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Washington
(State or Other Jurisdiction of Incorporation)

001-34443	91-1104842
(Commission File Number)	(IRS Employer Identification No.)

23500 64th Avenue South, Kent, Washington	98032
(Address of Principal Executive Offices)	(Zip Code)

(253) 850-3500
(Registrant’s Telephone Number, Including Area Code)

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

     o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

Flow International Corporation (the “Company”) issued a press release dated December 2, 2010 reporting results for the Company’s fiscal 2011 second quarter ended October 31, 2010. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1. The Company will hold a conference call to discuss the results on Thursday, December 2, 2010, at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time).

Item 9.01. Financial Statements and Exhibits.

     (d)          Exhibits

     99.1        Press release dated December 2, 2010.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	FLOW INTERNATIONAL CORPORATION                        (Registrant)
Date: December 2, 2010	By:	/s/ John S. Leness
		John S. Leness
		General Counsel and Secretary

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE
Contact:
Flow Investor Relations
Geoffrey Buscher
253-813-3286
investors@flowcorp.com

FLOW INTERNATIONAL ANNOUNCES SECOND QUARTER RESULTS
Sales of Consumable Parts Set All-Time Record

Kent, WA — December 2, 2010 — Flow International Corporation (NASDAQ: FLOW), the world’s leading developer and manufacturer of industrial waterjet machines for cutting and cleaning applications, today reported results for its fiscal 2011 second quarter ended October 31, 2010.

For the second quarter of fiscal 2011, Flow reported consolidated revenues of $52.9 million, a 26% increase from $42.0 million in the prior-year period. Net loss in the current quarter was $0.3 million or $0.01 per share. In comparison, the Company reported net income of $0.7 million or $0.02 per share in the prior-year period, which included a non-recurring $0.6 million gain on the sale of a facility.

Consolidated Adjusted EBITDA was $3.1 million in the second quarter of fiscal 2011 compared to $2.3 million in the year-ago quarter. The Company’s definition of Adjusted EBITDA is included in the attached tables and also in its filings with the U.S. Securities and Exchange Commission.

“We are now seeing consistent orders for our standard systems in all regions of the world for the first time since the recession hit, and quarterly sales of our consumables have eclipsed our pre-recession highs,” said Charley Brown, President and CEO of Flow. “We believe that our strategic growth initiatives, including our new indirect channel of distribution, have helped us turn this corner sooner than positive macroeconomic trends alone would have allowed.”

Operations Review for the Second Quarter of Fiscal 2011

• Standard segment sales, which include sales of systems that do not require significant custom configuration as well as parts and services for those installed systems, were $44.9 million, an increase of $13.4 million or 43% from the prior-year quarter.

• Advanced segment sales, which include sales of complex aerospace and application systems requiring specific custom configuration and advanced features, as well as parts and services for those installed systems, were $8.1 million for the quarter, reflecting an anticipated $2.5 million decline from the prior-year quarter. Advanced segment sales are recorded using the percentage of completion method, with lead times ranging as long as 18 to 24 months.

• Aggregate gross margins were 38% for the quarter, compared to aggregate gross margins of 40% in the prior-year quarter. Standard segment gross margins were consistent quarter over quarter at 42%. Advanced segment gross margins were 15% in the current quarter compared to 31% in the prior-year quarter. The decline in Advanced segment gross margin was attributable to unanticipated costs for certain contracts, primarily related to the installation phase of the projects. The Company expects gross margins in the Advanced segment to return to normalized levels in subsequent periods.

• Total operating expenses for the quarter were $19.0 million, compared to $16.9 million in the prior-year quarter, excluding the $0.6 million gain recognized on the sale of a facility. The $2.1 million increase is primarily the result of the reinstatement of wages and benefits, commissions related to increased sales and depreciation related to our ERP system.

Conference Call

Flow plans to hold a conference call to discuss these results today: Thursday, December 2^nd at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). The conference call may be heard by dialing 877-941-1427 or 480-629-9664. A 7-day replay will be available following the call by dialing 800-406-7325 or 303-590-3030. The conference call passcode is 4387631. A live audio Webcast of the conference call may be found in the investor section at www.flowcorp.com. A Webcast replay of the call will also be available for two weeks.

About Flow International

Flow International Corporation is the world’s leading developer and manufacturer of ultrahigh-pressure waterjet cutting technology to industries including automotive, aerospace, job shop, surface preparation, and more. For more information, visit www.flowcorp.com.

This press release contains forward-looking statements relating to future events or future financial performance that involve risks and uncertainties. The words “believe,” “expect,” “intend,” “anticipate,” variations of such words, and similar expressions identify forward-looking statements but their absence does not mean that the statement is not forward-looking. These statements are only predictions and actual results could differ materially from those anticipated in these statements based on a number of risk factors, including those set forth in the Company’s filings with the U.S. Securities and Exchange Commission. Forward- looking statements in this press release include, without limitation, statements regarding improving revenue, optimism for the indirect channel of distribution and the expectation that margins will return to normalized levels. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date of this announcement.

Flow International Corporation
Consolidated Statements of Operations
(Unaudited)

US Dollars in thousands, except per share data

	Three months ended October 31,									Six months ended October 31,
	2010			2009			% Change			2010			2009			% Change
Sales	$	52,935		$	42,037			26	%	$	99,515		$	79,789			25	%
Cost of Sales		33,082			25,405			30	%		60,329			49,181			23	%
Gross Margin		19,853			16,632			19	%		39,186			30,608			28	%
Operating Expenses:
Sales and Marketing		10,885			8,975			21	%		21,481			16,891			27	%
Research and Engineering		2,436			1,850			32	%		4,582			3,547			29	%
General and Administrative		5,659			6,071			-7	%		11,617			13,193			-12	%
Restructuring and Other Operating Charges		—			(601	)	NM				—			4,222		NM
Operating Expenses		18,980			16,295			16	%		37,680			37,853			0	%
Operating Income (Loss)		873			337		NM				1,506			(7,245	)	NM
Interest Expense, net		(393	)		(421	)		-7	%		(785	)		(1,345	)		-42	%
Other Income (Loss), net		104			(150	)	NM				396			352			13	%
Income (Loss) Before (Provision) Benefit for Income Taxes		584			(234	)	NM				1,117			(8,238	)	NM
(Provision) Benefit for Income Taxes		(804	)		923		NM				(1,868	)		1,529		NM
Gain (Loss) from Continuing Operations		(220	)		689		NM				(751	)		(6,709	)		89	%
Gain (Loss) from Discontinued Operations, net of tax		(103	)		8		NM				(112	)		(1,140	)		90	%
Net Income (Loss)	$	(323	)	$	697		NM			$	(863	)	$	(7,849	)		89	%
Basic and Diluted Income (Loss) Per Share:
Income (Loss) from Continuing Operations	$	(0.01	)	$	0.02		NM			$	(0.02	)	$	(0.17	)		89	%
Net Income (Loss)	$	(0.01	)	$	0.02		NM			$	(0.02	)	$	(0.19	)		89	%
Weighted Average Shares Outstanding Used in Computing Basic and Diluted Income (Loss) Per Share (000):
Basic and Diluted		47,160			42,841						47,102			40,295
Diluted		47,160			43,158						47,102			40,295
NM = not meaningful

Flow International Corporation
Consolidated Balance Sheets
(Unaudited)

US Dollars in thousands

	October 31,		April 30,
	2010		2010		% Change
ASSETS:
Current Assets:
Cash	$	6,892	$	6,367		8	%
Receivables, net		40,437		35,749		13	%
Inventories		27,213		22,503		21	%
Other Current Assets		9,136		9,476		-4	%
Total Current Assets		83,678		74,095
Property and Equipment, net		19,862		21,769		-9	%
Other Long-Term Assets		34,724		35,345		-2	%
	$	138,264	$	131,209
LIABILITIES AND SHAREHOLDERS’ EQUITY:
Current Liabilities:
Notes Payable	$	2,050	$	350	NM
Current Portion of Long-Term Obligations		28		61		-54	%
Accounts Payable and Other Accrued Liabilities		23,381		23,272		0	%
Other Current Liabilities		22,421		18,499		21	%
Total Current Liabilities		47,880		42,182
Other Long-Term Liabilities		5,778		5,449		6	%
Subordinated Notes		8,327		7,954		5	%
Total Other Long-Term Liabilities		61,985		55,585
Shareholders’ Equity		76,279		75,624		1	%
	$	138,264	$	131,209

NM = not meaningful

Flow International Corporation
Supplemental Data
(Unaudited)

US Dollars in thousands

	Three months ended October 31,							Six months ended October 31,
	2010		2009		% Change			2010		2009		% Change
								PY
Sales Breakdown:
Systems	$	34,907		27,365		28	%	$	65,442	$	51,769		26	%
Consumable Parts		18,028		14,672		23	%		34,073		28,020		22	%
Total	$	52,935	$	42,037		26	%	$	99,515	$	79,789		25	%
Segment Revenue Breakdown:
Standard	$	44,860	$	31,413		43	%	$	85,703	$	59,780		43	%
Advanced		8,075		10,624		-24	%		13,812		20,009		-31	%
	$	52,935	$	42,037		26	%	$	99,515	$	79,789		25	%
Depreciation and Amortization Expense	$	1,562	$	1,361		15	%	$	3,184	$	2,593		23	%
Capital Spending	$	452	$	3,485		-87	%	$	1,149	$	7,957		-86	%

Flow International Corporation
Reconciliation of Adjusted EBITDA to Net Income (Loss)
(Unaudited)

US Dollars in thousands

	Three months ended October 31,									Six months ended October 31,
	2010			2009			% Change			2010			2009			% Change
Net Income (Loss)	$	(323	)	$	697		NM			$	(863	)	$	(7,849	)		89	%
Add Back:
Depreciation and Amortization		1,562			1,361			15	%		3,184			2,593			23	%
Income Tax Provision (Benefit)		804			(923	)	NM				1,868			(1,529	)	NM
Interest Charges		437			474			-8	%		850			1,438			-41	%
Non-Cash Charges		531			622			-15	%		901			785			15	%
Other (i)		103			71			45	%		112			5,769			-98	%
Consolidated Adjusted EBITDA	$	3,114		$	2,302			35	%	$	6,052		$	1,207		NM

(i) Allowable Add Backs Pursuant to Senior Credit Facility Agreement

NM = not meaningful

Flow International Corporation
Reconciliation of GAAP to Pro forma
(Unaudited)

US Dollars in thousands, except per share data

	Three months ended October 31,						Six months ended October 31,
	2010			2009			2010			2009
GAAP Income (Loss) from Continuing Operations	$	(220	)	$	689		$	(751	)	$	(6,709	)
Adjustments:
OMAX Termination Charge		—			—			—			3,219
Restructuring and Other Operating Charges		—			(601	)		—			1,003
Write-off of Deferred Debt Issuance Costs		—			—			—			253
Tax Effect of Adjustments		—			138			—			(1,692	)
Tax Impact from Cash Repatriation & Discrete Foreign Tax Matters		303			—			990			—
Pro forma Income (Loss) from Continuing Operations	$	83		$	226		$	239		$	(3,926	)
GAAP Net Income (Loss)	$	(323	)	$	697		$	(863	)	$	(7,849	)
Adjustments:
OMAX Termination Charge		—			—			—			3,219
Restructuring and Other Operating Charges		—			(601	)		—			1,003
Write-off of Deferred Debt Issuance Costs		—			—			—			253
Discontinued Operations		103			(8	)		112			1,140
Tax Effect of Adjustments		—			138			—			(1,692	)
Tax Impact from Cash Repatriation & Discrete Foreign Tax Matters		303			—			990			—
Pro forma Net Income (Loss)	$	83		$	226		$	239		$	(3,926	)
Per Share Amounts
GAAP Basic and Diluted Income (Loss) Per Share
Income (Loss) from Continuing Operations	$	(0.01	)	$	0.02		$	(0.02	)	$	(0.17	)
Net Income (Loss)	$	(0.01	)	$	0.02		$	(0.02	)	$	(0.19	)
Pro forma Basic and Diluted Income (Loss) per Share
Income (Loss) from Continuing Operations	$	(0.00	)	$	0.01		$	0.01		$	(0.10	)
Net Income (Loss)	$	(0.00	)	$	0.01		$	0.01		$	(0.10	)