Exhibit 19.1 TO OUR STOCKHOLDERS, CUSTOMERS, AND EMPLOYEES Mueller's net income in the second quarter of 2008 was $27.0 million, or 72 cents per diluted share. This compares with $36.4 million, or 98 cents per diluted share, for the same period of 2007. Net sales for the second quarter of 2008 were $753.5 million compared with $772.6 million in 2007. For the first half, net income was $54.4 million, or $1.45 per diluted share on net sales of $1.46 billion. This compares with net income of $55.3 million, or $1.49 per diluted share, on net sales of $1.38 billion for the first half of 2007. As of quarter end, our financial leverage was modest with a debt to total capitalization ratio of 30.6 percent. Total stockholders' equity was $765.0 million which equates to a book value per share of $20.60 of which $7.37 per share is in cash. And, our return on average equity was 16.3 percent for the four quarters ended June, 2008. Mueller's earnings for the first half of 2008 were achieved despite the continuing decline in the housing industry, the sub-prime mortgage melt down, the turbulence in the financial markets, rising metal costs, sky-high energy prices and a slowing national economy. Considering these adverse circumstances, we are pleased with our results. Obviously, we cannot predict how long these difficult circumstances will persist. However, we are confident that Mueller's excellent balance sheet, strong cash flows and experienced management team will allow us to maximize our competitiveness and take advantage of opportunities. Our Annual Stockholders' Meeting was held at Mueller's headquarters in Memphis, Tennessee on May 1, 2008. The stockholders reelected our eight directors and approved the appointment of Ernst & Young LLP as our independent registered public accountants. Also, as your Board of Directors had recommended, the stockholders rejected a shareholder proposal regarding board membership. We remain committed to the principle that merit, integrity, and experience should be the basis for selecting director nominees. We appreciate your continuing support and confidence. Sincerely, /s/Harvey L. Karp /s/William D. O'Hagan Harvey L. Karp William D. O'Hagan Chairman of the Board President and Chief Executive Officer July 22, 2008 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, market demand, pricing, and competitive and technological factors, among others, as set forth in the Company's SEC filings. These filings are available through our website at www.muellerindustries.com. -1- MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
For the Quarter Ended June 28, June 30, 2008 2007 (In thousands, except per share data) Net sales $ 753,471 $ 772,647 Cost of goods sold 661,209 661,746 Depreciation and amortization 11,004 11,306 Selling, general, and administrative expense 34,618 38,971 ---------- ---------- Operating income 46,640 60,624 Interest expense (5,238) (5,689) Other income (expense), net 951 1,925 ---------- ---------- Income before income taxes 42,353 56,860 Income tax expense (15,339) (20,462) ---------- ---------- Net income $ 27,014 $ 36,398 ========== ========== Weighted average shares for basic earnings per share 37,119 37,060 Effect of dilutive stock options 340 204 ---------- ---------- Adjusted weighted average shares for diluted earnings per share 37,459 37,264 ---------- ---------- Basic earnings per share $ 0.73 $ 0.98 ========== ========== Diluted earnings per share $ 0.72 $ 0.98 ========== ========== Dividends per share $ 0.10 $ 0.10 ========== ==========
-2- MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (continued) (Unaudited)
For the Six Months Ended June 28, June 30, 2008 2007 (In thousands, except per share data) Net sales $ 1,457,579 $ 1,382,429 Cost of goods sold 1,273,006 1,198,324 Depreciation and amortization 21,988 22,272 Selling, general, and administrative expense 72,909 73,898 ---------- ---------- Operating income 89,676 87,935 Interest expense (10,705) (11,183) Other income (expense), net 4,968 6,878 ---------- ---------- Income before income taxes 83,939 83,630 Income tax expense (29,570) (28,319) ---------- ---------- Net income $ 54,369 $ 55,311 ========== ========== Weighted average shares for basic earnings per share 37,108 37,044 Effect of dilutive stock options 269 160 ---------- ---------- Adjusted weighted average shares for diluted earnings per share 37,377 37,204 ---------- ---------- Basic earnings per share $ 1.47 $ 1.49 ========== ========== Diluted earnings per share $ 1.45 $ 1.49 ========== ========== Dividends per share $ 0.20 $ 0.20 ========== ==========
-3- MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
June 28, 2008 December 29, 2007 (In thousands) Assets Cash and cash equivalents $ 273,620 $ 308,618 Accounts receivable, net 392,826 323,003 Inventories 263,752 269,032 Other current assets 36,789 39,694 ---------- ---------- Total current assets 966,987 940,347 Property, plant, and equipment, net 303,453 308,383 Other assets 201,361 200,474 ---------- ---------- $ 1,471,801 $ 1,449,204 ========== ========== Liabilities and Stockholders' Equity Current portion of long-term debt $ 55,365 $ 72,743 Accounts payable 130,182 140,497 Other current liabilities 120,478 121,813 ---------- ---------- Total current liabilities 306,025 335,053 Long-term debt 281,586 281,738 Pension and postretirement liabilities 36,001 36,071 Environmental reserves 8,873 8,897 Deferred income taxes 46,197 52,156 Other noncurrent liabilities 2,197 2,029 ---------- ---------- Total liabilities 680,879 715,944 Minority interest in subsidiary 25,895 22,765 Stockholders' equity 765,027 710,495 ---------- ---------- $ 1,471,801 $ 1,449,204 ========== ==========
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