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Mueller Industries, Inc. Reports First Quarter 2021 Earnings

Mueller Industries, Inc. (NYSE: MLI) announces 2021 first quarter results. (All comparisons are to the prior year quarter.)

  • Operating income of $92.5 million versus $59.3 million
  • Net income of $63.1 million versus $32.4 million
  • Net sales of $818.1 million versus $602.9 million
  • EPS of $1.11 versus $0.57 per share

Financial and Operating Highlights:

  • Average COMEX copper for the first quarter was $3.86 per pound, a 50 percent increase over the first quarter of last year.
  • The increase in net sales was attributable to unit sales growth across most of our businesses, recent acquisitions and the influence of the higher copper prices. The price of copper is largely passed through and as such, impacts selling prices in many of our businesses.
  • Selling, general, and administrative expense was $45.4 million for the quarter, which included $2.7 million of incremental expense from recently acquired businesses, compared to $42.8 million in the prior year quarter.
  • We recorded a $1.6 million loss on our investment in Tecumseh Products Company for the quarter, compared to a $6.3 million loss recorded during the prior year period.
  • During the quarter, we closed on our previously announced acquisition of the Hart & Cooley Flexible Duct business.
  • At quarter-end, cash on hand was $129.9 million, our debt to total capitalization was 31 percent, and the current ratio was 2.2 to 1.

Regarding the state of the Company and outlook, Greg Christopher, Mueller's CEO said:

“Our performance in the first quarter falls in line with our 2020 year-end expectations. Most economies in which we operate continue to improve, as restrictions imposed in response to the pandemic are being lifted. The increased availability of vaccines, the significant flow of money into global economies, and the potential of a U.S. infrastructure bill, strengthen this positive outlook.”

Mueller Industries, Inc. (NYSE: MLI) is an industrial corporation whose holdings manufacture vital goods for important markets such as air, water, oil and gas distribution; climate comfort; food preservation; energy transmission; medical; aerospace; and automotive. It includes a network of companies and brands throughout North America, Europe, Asia, and the Middle East.

Statements in this release that are not strictly historical may be “forward-looking” statements, which involve risks and uncertainties. These include economic and currency conditions, continued availability of raw materials and energy, market demand, pricing, competitive and technological factors, and the availability of financing, among others, as set forth in the Company’s SEC filings. The words “outlook,” “estimate,” “project,” “intend,” “expect,” “believe,” “target,” “encourage,” “anticipate,” “appear,” and similar expressions are intended to identify forward-looking statements. The reader should not place undue reliance on forward-looking statements, which speak only as of the date of this report. The Company has no obligation to publicly update or revise any forward-looking statements to reflect events after the date of this report.

MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

 

 

 

For the Quarter Ended

(In thousands, except per share data)

 

March 27,

2021

 

March 28,

2020

 

 

 

 

 

Net sales

 

$

818,148

 

$

602,919

 

 

 

 

 

Cost of goods sold

 

668,418

 

508,715

Depreciation and amortization

 

11,755

 

11,039

Selling, general, and administrative expense

 

45,435

 

42,752

Asset impairments

 

 

3,035

Litigation settlement, net

 

 

(21,933)

 

 

 

 

 

Operating income

 

92,540

 

59,311

 

 

 

 

 

Interest expense

 

(4,469)

 

(5,379)

Other income, net

 

577

 

278

 

 

 

 

 

Income before income taxes

 

88,648

 

54,210

 

 

 

 

 

Income tax expense

 

(21,761)

 

(14,144)

Loss from unconsolidated affiliates, net of foreign tax

 

(1,649)

 

(6,115)

 

 

 

 

 

Consolidated net income

 

65,238

 

33,951

 

 

 

 

 

Net income attributable to noncontrolling interests

 

(2,131)

 

(1,536)

 

 

 

 

 

Net income attributable to Mueller Industries, Inc.

 

$

63,107

 

$

32,415

 

 

 

 

 

Weighted average shares for basic earnings per share

 

55,916

 

55,875

Effect of dilutive stock-based awards

 

756

 

583

 

 

 

 

 

Adjusted weighted average shares for diluted earnings per share

 

56,672

 

56,458

 

 

 

 

 

Basic earnings per share

 

$

1.13

 

$

0.58

 

 

 

 

 

Diluted earnings per share

 

$

1.11

 

$

0.57

 

 

 

 

 

Dividends per share

 

$

0.13

 

$

0.10

 

 

 

 

 

Summary Segment Data:

 

 

 

 

 

 

 

 

 

Net sales:

 

 

 

 

Piping Systems Segment

 

$

547,748

 

$

385,013

Industrial Metals Segment

 

164,852

 

131,202

Climate Segment

 

111,026

 

93,272

Elimination of intersegment sales

 

(5,478)

 

(6,568)

 

 

 

 

 

Net sales

 

$

818,148

 

$

602,919

 

 

 

 

 

Operating income:

 

 

 

 

Piping Systems Segment

 

$

67,098

 

$

36,676

Industrial Metals Segment

 

18,847

 

11,182

Climate Segment

 

17,335

 

13,014

Unallocated expenses

 

(10,740)

 

(1,561)

 

 

 

 

 

Operating income

 

$

92,540

 

$

59,311

MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

(Unaudited)

 

 

(In thousands)

 

March 27,

2021

 

December 26,

2020

ASSETS

 

 

 

 

Cash and cash equivalents

 

$

129,876

 

$

119,075

Accounts receivable, net

 

447,492

 

357,532

Inventories

 

365,457

 

315,002

Other current assets

 

43,710

 

33,752

 

 

 

 

 

Total current assets

 

986,535

 

825,361

 

 

 

 

 

Property, plant, and equipment, net

 

384,853

 

376,572

Operating lease right-of-use assets

 

28,494

 

29,301

Other assets

 

298,447

 

297,334

 

 

 

 

 

Total assets

 

$

1,698,329

 

$

1,528,568

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current portion of debt

 

$

106,164

 

$

41,283

Accounts payable

 

177,174

 

147,741

Current portion of operating lease liabilities

 

6,567

 

6,259

Other current liabilities

 

154,583

 

144,360

 

 

 

 

 

Total current liabilities

 

444,488

 

339,643

 

 

 

 

 

Long-term debt

 

286,576

 

286,593

Pension and postretirement liabilities

 

25,468

 

26,841

Environmental reserves

 

21,322

 

21,256

Deferred income taxes

 

17,127

 

16,842

Noncurrent operating lease liabilities

 

20,832

 

21,602

Other noncurrent liabilities

 

14,503

 

14,731

 

 

 

 

 

Total liabilities

 

830,316

 

727,508

 

 

 

 

 

Total Mueller Industries, Inc. stockholders’ equity

 

841,146

 

776,745

Noncontrolling interests

 

26,867

 

24,315

 

 

 

 

 

Total equity

 

868,013

 

801,060

 

 

 

 

 

Total liabilities and equity

 

$

1,698,329

 

$

1,528,568

 

MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

For the Quarter Ended

(In thousands)

 

March 27,

2021

 

March 28,

2020

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

Consolidated net income

 

$

65,238

 

$

33,951

Reconciliation of consolidated net income to net cash (used in) provided by operating activities:

 

 

 

 

Depreciation and amortization

 

11,775

 

11,119

Stock-based compensation expense

 

2,109

 

1,985

Provision for doubtful accounts receivable

 

1,631

 

1,100

Loss from unconsolidated affiliates

 

1,649

 

6,115

(Gain) loss on disposals of properties

 

(936)

 

32

Impairment charges

 

 

3,035

Deferred income tax expense

 

142

 

213

Changes in assets and liabilities, net of effects of businesses acquired:

 

 

 

 

Receivables

 

(89,972)

 

(46,291)

Inventories

 

(45,590)

 

17,450

Other assets

 

1,230

 

8,010

Current liabilities

 

33,941

 

(10,821)

Other liabilities

 

(3,703)

 

(1,643)

Other, net

 

(95)

 

3,796

 

 

 

 

 

Net cash (used in) provided by operating activities

 

(22,581)

 

28,051

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Capital expenditures

 

(9,227)

 

(17,094)

Acquisition of businesses, net of cash acquired

 

(14,029)

 

(15,407)

Proceeds from sales of properties

 

1,730

 

 

 

 

 

 

Net cash used in investing activities

 

(21,526)

 

(32,501)

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Repurchase of common stock

 

 

(5,574)

Issuance of debt

 

100,000

 

110,000

Repayments of debt

 

(35,288)

 

(20,572)

Issuance of debt by consolidated joint ventures, net

 

45

 

189

Net cash received to settle stock-based awards

 

221

 

464

 

 

 

 

 

Net cash provided by financing activities

 

64,978

 

84,507

 

 

 

 

 

Effect of exchange rate changes on cash

 

784

 

(6,135)

 

 

 

 

 

Increase in cash, cash equivalents, and restricted cash

 

21,655

 

73,922

Cash, cash equivalents, and restricted cash at the beginning of the period

 

127,376

 

98,042

 

 

 

 

 

Cash, cash equivalents, and restricted cash at the end of the period

 

$

149,031

 

$

171,964

 

Contacts

Jeffrey A. Martin

(901) 753-3226

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