Mueller Industries, Inc. Reports Second Quarter 2021 Earnings

COLLIERVILLE, Tenn., July 20, 2021 -- 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."

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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.

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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.

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 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

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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

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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

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