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Mueller Industries, Inc. Reports Second Quarter 2021 Earnings

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COLLIERVILLE, Tenn., July 20, 2021--(BUSINESS WIRE)--Mueller Industries, Inc. (NYSE: MLI) announces 2021 second quarter results. (All comparisons are to the prior year quarter.)

  • Operating income of $157.8 million versus $52.3 million

  • Net income of $108.8 million versus $28.0 million

  • Net sales of $1.01 billion versus $500.2 million

  • EPS of $1.92 versus $0.50 per share

Financial and Operating Highlights:

  • Average COMEX copper for the second quarter was $4.43 per pound, an 82 percent increase over the second quarter of last year.

  • The increase in net sales was attributable to unit sales growth across all segments, contributions from 2020 acquisitions, and the influence of higher copper prices.

  • During the quarter, we retired our Subordinated Debentures ($284.4 million) and recognized an expense of $5.7 million for a redemption premium.

  • We recorded a $1.0 million loss on our investment in Tecumseh Products Company for the quarter, compared to an $8.6 million loss recorded during the prior year period.

  • At quarter-end, cash on hand was $110.7 million, our debt to total capitalization was 27 percent, and the current ratio was 3.0 to 1.

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

"During the second quarter, our team delivered excellent operating performance while confronting highly inflated demand and widespread industry supply constraints. Extended lead times and abnormally high backlogs are expected to continue well into the third quarter, as many of these conditions persist.

Mueller’s operations remain well positioned for the current market conditions due to our operational investments and acquisitions that enhance capacity, increase yields and lower costs. In addition, we continue to benefit from the prudent cost controls we implemented during the height of the pandemic.

We anticipate that strong demand in the building construction sectors will continue through the remainder of the year."

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

For the Six Months Ended

(In thousands, except per share data)

June 26, 2021

June 27, 2020

June 26, 2021

June 27, 2020

Net sales

$

1,012,592

$

500,168

$

1,830,740

$

1,103,087

Cost of goods sold

799,712

403,159

1,468,130

911,874

Depreciation and amortization

11,134

11,097

22,889

22,136

Selling, general, and administrative expense

43,932

33,616

89,367

76,368

Asset impairments

3,035

Litigation settlement, net

(21,933

)

Operating income

157,814

52,296

250,354

111,607

Interest expense

(1,866

)

(4,973

)

(6,335

)

(10,352

)

Redemption premium

(5,674

)

(5,674

)

Other income, net

683

2,834

1,260

3,112

Income before income taxes

150,957

50,157

239,605

104,367

Income tax expense

(39,006

)

(13,029

)

(60,767

)

(27,173

)

Loss from unconsolidated affiliates, net of foreign tax

(1,019

)

(8,641

)

(2,668

)

(14,756

)

Consolidated net income

110,932

28,487

176,170

62,438

Net income attributable to noncontrolling interests

(2,100

)

(531

)

(4,231

)

(2,067

)

Net income attributable to Mueller Industries, Inc.

$

108,832

$

27,956

$

171,939

$

60,371

Weighted average shares for basic earnings per share

55,946

55,723

55,931

55,799

Effect of dilutive stock-based awards

866

471

811

527

Adjusted weighted average shares for diluted earnings per share

56,812

56,194

56,742

56,326

Basic earnings per share

$

1.95

$

0.50

$

3.07

$

1.08

Diluted earnings per share

$

1.92

$

0.50

$

3.03

$

1.07

Dividends per share

$

0.13

$

0.10

$

0.26

$

0.20

Summary Segment Data:

Net sales:

Piping Systems Segment

$

711,616

$

334,040

$

1,259,364

$

719,053

Industrial Metals Segment

180,040

88,619

344,892

219,821

Climate Segment

131,708

86,107

242,734

179,379

Elimination of intersegment sales

(10,772

)

(8,598

)

(16,250

)

(15,166

)

Net sales

$

1,012,592

$

500,168

$

1,830,740

$

1,103,087

Operating income:

Piping Systems Segment

$

124,508

$

41,074

$

191,606

$

77,750

Industrial Metals Segment

20,499

8,873

39,346

20,055

Climate Segment

25,372

12,353

42,707

25,367

Unallocated expenses

(12,565

)

(10,004

)

(23,305

)

(11,565

)

Operating income

$

157,814

$

52,296

$

250,354

$

111,607

MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

June 26,
2021

December 26,
2020

ASSETS

Cash and cash equivalents

$

110,681

$

119,075

Accounts receivable, net

542,044

357,532

Inventories

384,982

315,002

Other current assets

44,288

33,752

Total current assets

1,081,995

825,361

Property, plant, and equipment, net

385,246

376,572

Operating lease right-of-use assets

26,871

29,301

Other assets

295,325

297,334

Total assets

$

1,789,437

$

1,528,568

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current portion of debt

$

6,428

$

41,283

Accounts payable

190,403

147,741

Current portion of operating lease liabilities

6,546

6,259

Other current liabilities

159,052

144,360

Total current liabilities

362,429

339,643

Long-term debt

350,996

286,593

Pension and postretirement liabilities

25,167

26,841

Environmental reserves

21,020

21,256

Deferred income taxes

16,363

16,842

Noncurrent operating lease liabilities

19,433

21,602

Other noncurrent liabilities

20,113

14,731

Total liabilities

815,521

727,508

Total Mueller Industries, Inc. stockholders’ equity

945,716

776,745

Noncontrolling interests

28,200

24,315

Total equity

973,916

801,060

Total liabilities and equity

$

1,789,437

$

1,528,568

MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

For the Six Months Ended

(In thousands)

June 26, 2021

June 27, 2020

Cash flows from operating activities

Consolidated net income

$

176,170

$

62,438

Reconciliation of consolidated net income to net cash provided by operating activities:

Depreciation and amortization

22,975

22,296

Stock-based compensation expense

4,817

4,198

Provision for doubtful accounts receivable

1,280

1,850

Loss from unconsolidated affiliates

2,668

14,756

Redemption premium

5,674

Gain on disposals of properties

(819

)

(9

)

Impairment charges

3,035

Deferred income tax expense

3,252

764

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

Receivables

(190,944

)

(11,212

)

Inventories

(63,949

)

43,263

Other assets

(5,482

)

3,967

Current liabilities

50,456

(277

)

Other liabilities

3,429

(5,369

)

Other, net

(247

)

3,082

Net cash provided by operating activities

9,280

142,782

Cash flows from investing activities

Capital expenditures

(17,978

)

(22,215

)

Acquisition of businesses, net of cash acquired

(13,935

)

(15,415

)

Payment received for notes receivable

8,539

Proceeds from sales of properties

1,730

1

Net cash used in investing activities

(21,644

)

(37,629

)

Cash flows from financing activities

Dividends paid to stockholders of Mueller Industries, Inc.

(14,546

)

(11,168

)

Repurchase of common stock

(5,574

)

Issuance of debt

425,000

110,015

Repayments of debt

(400,497

)

(166,021

)

Issuance (repayment) of debt by consolidated joint ventures, net

463

(471

)

Net cash received to settle stock-based awards

414

696

Debt issuance costs

(1,111

)

Net cash provided by (used in) financing activities

9,723

(72,523

)

Effect of exchange rate changes on cash

987

(6,160

)

(Decrease) increase in cash, cash equivalents, and restricted cash

(1,654

)

26,470

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

$

125,722

$

124,512

View source version on businesswire.com: https://www.businesswire.com/news/home/20210720005241/en/

Contacts

Jeffrey A. Martin
(901) 753-3226