Exhibit 99.1
 
Mueller Industries, Inc. Reports Second Quarter 2014 Earnings
 
MEMPHIS, Tenn., July 22, 2014 -- Mueller Industries, Inc. (NYSE: MLI) announced today net income of $35.0 million, or 62 cents per diluted share, for the second quarter of 2014.  This compares with net income from normal operations in the second quarter of 2013 of $25.5 million, or 45 cents per diluted share.  During the second quarter of 2013, the Company also recognized an after-tax gain of $65.6 million, or $1.17 per diluted share, on the settlement of an insurance claim.  Diluted earnings per share for 2013 have been adjusted to reflect a 2-for-1 stock split that was effected during the first quarter of 2014.
 
Net sales for the second quarter were $649.7 million compared with $582.3 million for the same quarter of the prior year representing an increase of 11.6 percent.  Sales were positively impacted by a 15.9 percent increase in unit volumes, partially offset by a 4.6 percent reduction in copper prices in the second quarter of 2014 compared with the same period of the prior year.  Copper prices averaged $3.10 per pound in the second quarter of 2014 compared with $3.25 per pound in the same period of 2013.
 
Financial highlights for the second quarter of 2014:
-  
Acquired businesses contributed 10.8 percent of the overall 15.9 percent increase in unit volumes.
 
-  
The effective tax rate for the quarter reflects a reduction in valuation allowances previously recorded against certain state tax credits.
 
-  
Results include $2.4 million of severance and other charges related to the U.K. copper tube business acquired in the first quarter of 2014.
 
-  
Quarter end cash totaled $242.2 million equal to $4.27 per share.
 
-  
Stockholders’ equity was $760.8 million, which equates to a book value per share of $13.42.
 
-  
Debt to total capitalization ratio was 25.1 percent and the current ratio was 3.5 to 1.
 
 
Regarding the outlook, Greg Christopher, CEO said, “Despite the lack of supportive market conditions, we are pleased with how our businesses continue to improve.  Although there are fluctuations in building construction metrics the overall direction seems to be improving and we anticipate the same will continue into the second half of the year.”
 
Mueller Industries, Inc. is a leading manufacturer of copper tube and fittings; brass and copper alloy rod, bar and shapes; aluminum and brass forgings; aluminum and copper impact extrusions; plastic fittings and valves; refrigeration valves and fittings; and fabricated tubular products.  Mueller’s operations are located throughout the United States and in Canada, Mexico, Great Britain, and China.  Mueller’s business is importantly linked to: (1) the construction of new homes; (2) the improvement and reconditioning of existing homes and structures; and (3) the commercial construction market that includes office buildings, factories, hotels, hospitals, etc.
 

*********************
 

 
 

 
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,” 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.
 

 
CONTACT
 
Jeffrey A. Martin
 
 
(901)753-3226
 
 
 
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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 28,
2014
   
June 29,
2013
   
June 28,
2014
   
June 29,
2013
 
                         
Net sales
 
$
649,691
   
$
582,282
   
$
1,224,065
   
$
1,141,972
 
                                 
Cost of goods sold
   
557,775
     
501,125
     
1,053,552
     
983,975
 
Depreciation and amortization
   
8,592
     
8,328
     
16,699
     
16,482
 
Selling, general, and administrative expense
   
35,120
     
34,814
     
67,303
     
66,157
 
Insurance settlement
   
     
(106,332
)
   
     
(106,332
)
                                 
Operating income
   
48,204
     
144,347
     
86,511
     
181,690
 
Interest expense
   
(1,457
)
   
(1,101
)
   
(2,483
)
   
(1,697
)
Other income, net
   
127
     
319
     
215
     
3,482
 
                                 
Income before income taxes
   
46,874
     
143,565
     
84,243
     
183,475
 
Income tax expense
   
(11,665
)
   
(51,723
)
   
(24,080
)
   
(65,199
)
                                 
Consolidated net income
   
35,209
     
91,842
     
60,163
     
118,276
 
Net income attributable to
  noncontrolling interest
   
(164
)
   
(692
)
   
(412
)
   
(924
)
                                 
Net income attributable to
  Mueller Industries, Inc.
 
$
35,045
   
$
91,150
   
$
59,751
   
$
117,352
 
                                 
Weighted average shares for basic
  earnings per share
   
55,973
     
55,681
     
55,946
     
55,663
 
Effect of dilutive stock-based awards
   
747
     
740
     
800
     
744
 
                                 
Adjusted weighted average shares for diluted
  earnings per share
   
56,720
     
56,421
     
56,746
     
56,407
 
                                 
Basic earnings per share
 
$
0.63
   
$
1.64
   
$
1.07
   
$
2.11
 
                                 
Diluted earnings per share
 
$
0.62
   
$
1.62
   
$
1.05
   
$
2.08
 
                                 
Dividends per share
 
$
0.075
   
$
0.0625
   
$
0.150
   
$
0.125
 
                                 
Summary Segment Data:
                               
                                 
Net sales:
                               
    Plumbing & Refrigeration Segment
 
$
397,190
   
$
328,673
   
$
735,217
   
$
640,487
 
    OEM Segment
   
255,409
     
257,044
     
495,439
     
510,831
 
    Elimination of intersegment sales
   
(2,908
)
   
(3,435
)
   
(6,591
)
   
(9,346
)
                                 
Net sales
 
$
649,691
   
$
582,282
   
$
1,224,065
   
$
1,141,972
 
                                 
Operating income:
                               
    Plumbing & Refrigeration Segment
 
$
32,330
   
$
129,810
   
$
56,215
   
$
152,437
 
    OEM Segment
   
23,216
     
20,939
     
44,502
     
41,262
 
    Unallocated expenses
   
(7,342
)
   
(6,402
)
   
(14,206
)
   
(12,009
)
                                 
Operating income
 
$
48,204
   
$
144,347
   
$
86,511
   
$
181,690
 
 
 
 
 
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MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
(In thousands)
 
June 28,
2014
   
December 28,
 2013
 
ASSETS
           
Cash and cash equivalents
 
$
242,199
   
$
311,800
 
Accounts receivable, net
   
367,299
     
271,847
 
Inventories
   
291,138
     
251,716
 
Other current assets
   
45,410
     
39,354
 
                 
    Total current assets
   
946,046
     
874,717
 
                 
Property, plant, and equipment, net
   
245,441
     
244,457
 
Other assets
   
158,371
     
128,593
 
                 
   
$
1,349,858
   
$
1,247,767
 
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
           
Current portion of debt
 
$
60,328
   
$
29,083
 
Accounts payable
   
101,671
     
80,897
 
Other current liabilities
   
106,154
     
109,276
 
                 
    Total current liabilities
   
268,153
     
219,256
 
                 
Long-term debt
   
205,750
     
206,250
 
Pension and postretirement liabilities
   
26,818
     
27,426
 
Environmental reserves
   
21,661
     
22,144
 
Deferred income taxes
   
33,226
     
35,975
 
Other noncurrent liabilities
   
1,306
     
849
 
                 
    Total liabilities
   
556,914
     
511,900
 
                 
Total Mueller Industries, Inc. stockholders’ equity
   
760,823
     
703,405
 
Noncontrolling interest
   
32,121
     
32,462
 
                 
    Total equity
   
792,944
     
735,867
 
                 
   
$
1,349,858
   
$
1,247,767
 
                 
 
 
 
 
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MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

   
For the Six Months Ended
 
 (In thousands)
 
June 28,
2014
   
June 29,
2013
 
         
Cash flows from operating activities
               
Consolidated net income
 
$
60,163
   
$
118,276
 
Reconciliation of consolidated net income to net cash (used in) provided by operating activities:
               
      Depreciation and amortization
   
16,840
     
16,649
 
      Stock-based compensation expense
   
3,526
     
3,326
 
      Insurance settlement
   
     
(106,332
)
      Insurance proceeds – noncapital related
   
     
32,395
 
      Gain on disposal of properties
   
(1,225
)
   
(2,984
)
      Deferred income taxes
   
(6,523
)
   
12,468
 
      Income tax benefit from exercise of stock options
   
(316
)
   
(95
)
      Changes in assets and liabilities, net of business acquired
               
        Receivables
   
(100,413
)
   
(35,095
)
        Inventories
   
(20,619
)
   
4,705
 
        Other assets
   
(8,886
)
   
(306
)
        Current liabilities
   
7,373
     
6,150
 
        Other liabilities
   
(893
)
   
(423
)
        Other, net
   
92
     
420
 
                 
Net cash (used in) provided by operating activities
   
(50,881
)
   
49,154
 
                 
Cash flows from investing activities
               
Capital expenditures
   
(18,833
)
   
(21,687
)
Business acquired, net of cash acquired
   
(30,137
)
   
 
Insurance proceeds for property and equipment
   
     
29,910
 
Net withdrawals from (deposits into) restricted cash balances
   
1,815
     
(4,721
)
Proceeds from the sales of properties
   
4,874
     
3,016
 
                 
Net cash (used in) provided by investing activities
   
(42,281
)
   
6,518
 
                 
Cash flows from financing activities
               
Repayments of long-term debt
   
(500
)
   
(500
)
Dividends paid to stockholders of Mueller Industries, Inc.
   
(8,394
)
   
(6,960
)
Debt issuance cost
   
     
(50
)
Issuance of debt
   
22,635
     
 
Issuance (repayment) of debt by joint venture, net
   
8,903
     
15,544
 
Net cash received to settle stock-based awards
   
296
     
260
 
Repurchase of common stock
   
(58
)
   
 
Income tax benefit from exercise of stock options
   
316
     
95
 
                 
Net cash provided by financing activities
   
23,198
     
8,389
 
                 
Effect of exchange rate changes on cash
   
363
     
(1,328
)
                 
(Decrease) increase in cash and cash equivalents
   
(69,601
)
   
62,733
 
Cash and cash equivalents at the beginning of the period
   
311,800
     
198,934
 
                 
Cash and cash equivalents at the end of the period
 
$
242,199
   
$
261,667
 
                 
 
 
 
 
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MUELLER INDUSTRIES, INC.
Reconciliation of Net Income as Reported to Pro forma Without Insurance Settlement
(Unaudited)

Earnings attributable to normal operations without the insurance settlement is a measurement not derived in accordance with generally accepted accounting principles (GAAP).  Excluding the insurance settlement is useful as it measures the operating results that are the outcome of daily operating decisions made in the normal course of business.  The insurance settlement was related to a 2011 claim at the Company's Wynne, Arkansas, manufacturing operations.  Reconciliation of earnings attributable to normal operations without the insurance settlement to net income as reported is as follows:

   
For the Quarter Ended
June 29, 2013
 
(In thousands, except per share data)
 
As
Reported
   
Impact of
Insurance
Settlement
   
Pro forma
Without
Insurance
Settlement
 
                         
Operating income
 
$
144,347
   
$
106,332
   
$
38,015
 
                         
Interest expense
   
(1,101
)
   
     
(1,101
)
Other income, net
   
319
     
     
319
 
                         
Income before income taxes
   
143,565
     
106,332
     
37,233
 
Income tax expense
   
(51,723
)
   
(40,723
)
   
(11,000
)
                         
Consolidated net income
   
91,842
     
65,609
     
26,233
 
Net income attributable to noncontrolling interest
   
(692
)
   
     
(692
)
                         
Net income attributable to Mueller Industries, Inc.
 
$
91,150
   
$
65,609
   
$
25,541
 
                         
Diluted earnings per share
 
$
1.62
   
$
1.17
   
$
0.45
 


 

 
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