Mueller Industries, Inc. Reports Second Quarter 2021 Earnings
COLLIERVILLE, Tenn.--(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.
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MUELLER INDUSTRIES, INC.
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For the Quarter Ended |
For the Six Months Ended |
||||||||||||||
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(In thousands, except per share data) |
June 26, 2021 |
June 27, 2020 |
June 26, 2021 |
June 27, 2020 |
||||||||||||
|
|
|
|
|
|
||||||||||||
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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 |
|
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|
|
|
|
|
|
||||||||||||
|
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 |
) |
||||||||
|
|
|
|
|
|
||||||||||||
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Consolidated net income |
110,932 |
|
28,487 |
|
176,170 |
|
62,438 |
|
||||||||
|
|
|
|
|
|
||||||||||||
|
Net income attributable to noncontrolling interests |
(2,100 |
) |
(531 |
) |
(4,231 |
) |
(2,067 |
) |
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|
|
|
|
|
|
||||||||||||
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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 |
|
||||||||
|
|
|
|
|
|
||||||||||||
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Basic earnings per share |
$ |
1.95 |
|
$ |
0.50 |
|
$ |
3.07 |
|
$ |
1.08 |
|
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|
|
|
|
|
|
||||||||||||
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Diluted earnings per share |
$ |
1.92 |
|
$ |
0.50 |
|
$ |
3.03 |
|
$ |
1.07 |
|
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|
|
|
|
|
|
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Dividends per share |
$ |
0.13 |
|
$ |
0.10 |
|
$ |
0.26 |
|
$ |
0.20 |
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|
|
|
|
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Summary Segment Data: |
|
|
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|
|
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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 |
|
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MUELLER INDUSTRIES, INC.
|
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|
(Unaudited) |
|
||||
|
(In thousands) |
June 26,
|
December 26,
|
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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 |
||
|
|
|
|
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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 |
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|
MUELLER INDUSTRIES, INC.
|
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|
|
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/
Jeffrey A. Martin
(901) 753-3226
Source: Mueller Industries, Inc.
Released July 20, 2021