Mueller Industries, Inc. Reports Fiscal 2021 Fourth Quarter and Full Year Results

COLLIERVILLE, Tenn., February 1, 2022 -- Mueller Industries, Inc. (NYSE: MLI) today reported 2021 fourth quarter and full year results.

Fourth Quarter metrics:

•Operating income was $172.1 million, up 165%.

•Net sales were $956.4 million, up 42%.

•Net income was $125.6 million versus $36.4 million.

•Diluted EPS was $2.21 versus $0.64.

•Cash provided by operations was $130.2 million.

Full Year metrics:

•Operating income was $655.8 million, up 167%.

•Net sales were $3.8 billion, up 57%.

•Net income was $468.5 million versus $139.5 million.

•Diluted EPS was $8.25 versus $2.47.

•Cash provided by operations was $311.7 million.

*Comparisons to prior year periods

Quarter Commentary

•The average price of copper was 34.3 percent higher than in the fourth quarter of 2020.

•Net sales growth was driven by volume growth in our US businesses, higher prices primarily attributable to the rise in COMEX copper, and the contributions of our recently acquired H&C Flex business, which is recorded under our Climate segment.

•The Company recorded a loss of $1.8 million on its investment in Tecumseh during the quarter, compared to income of $10.0 million in the previous year quarter, which included a pre-tax gain of $11.6 million from a land sale.

•During the quarter we acquired the majority ownership of the Mueller Middle East copper tube mill in Bahrain. This mill is geographically well positioned to serve markets in the Middle East and Northern Africa.

Full Year Commentary

•The results included $57.8 million of gains from the sale of businesses.

•The average price of copper was 51.6 percent higher than in 2020.

•Net sales growth of $1.4 billion was driven by volume growth in almost every business, higher selling prices primarily resulting from the rise in COMEX copper, and full year reported sales of acquired businesses.

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•During the year, $330.7 million of debt was repaid leaving a balance of $1.9 million at year-end. The Company’s $400.0 million credit facility is undrawn and cash and cash equivalents totaled $87.9 million.

Operating Highlights and Outlook:

Greg Christopher, CEO, commented, “Our exceptional results in the fourth quarter capped our second consecutive year of record earnings. The strength our businesses exhibited throughout the year was fueled by solid demand and outstanding operational execution by our team in the face of significant inflationary pressures, supply chain disruptions, and extensive labor shortages.”

With regard to the outlook, he added “We anticipate continued momentum in the building construction and industrial markets in 2022, both important end markets for our businesses. Mueller is well positioned to build upon its success as we start the new year with healthy order books and our manufacturing facilities operating at highly efficient levels.”

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 Year Ended
(In thousands, except per share data)			December 25, 2021						December 26, 2020						December 25, 2021						December 26, 2020
Net sales			$	956,357					$	675,851					$	3,769,345					$	2,398,043
Cost of goods sold			726,594						553,507						2,938,989						1,966,161
Depreciation and amortization			11,633						11,955						45,390						44,843
Selling, general, and administrative expense			48,729						44,649						184,052						159,483
Gain on sale of businesses			(3,001)						—						(57,760)						—
Litigation settlement, net			—						—						—						(22,053)
Impairment charges			261						736						2,829						3,771
Operating income			172,141						65,004						655,845						245,838
Interest expense			(258)						(4,010)						(7,709)						(19,247)
Environmental expense			(982)						(3,488)						(5,053)						(4,454)
Redemption premium			—						—						(5,674)						—
Pension plan termination expense			—						(17,835)						—						(17,835)
Other income, net			947						287						3,730						4,887
Income before income taxes			171,848						39,958						641,139						209,189
Income tax expense			(44,862)						(12,698)						(165,858)						(55,321)
(Loss) income from unconsolidated affiliates, net of foreign tax			(288)						9,994						(157)						(10,219)
Consolidated net income			126,698						37,254						475,124						143,649
Net income attributable to noncontrolling interests			(1,097)						(834)						(6,604)						(4,156)
Net income attributable to Mueller Industries, Inc.			$	125,601					$	36,420					$	468,520					$	139,493
Weighted average shares for basic earnings per share			56,104						55,869						56,011						55,821
Effect of dilutive stock-based awards			796						673						787						569
Adjusted weighted average shares for diluted earnings per share			56,900						56,542						56,798						56,390
Basic earnings per share			$	2.24					$	0.65					$	8.36					$	2.50
Diluted earnings per share			$	2.21					$	0.64					$	8.25					$	2.47
Dividends per share			$	0.13					$	0.10					$	0.52					$	0.40

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME, CONTINUED

(Unaudited)

			For the Quarter Ended												For the Year Ended
(In thousands)			December 25, 2021						December 26, 2020						December 25, 2021						December 26, 2020
Summary Segment Data:
Net sales:
Piping Systems Segment			$	652,466					$	454,535					$	2,600,030					$	1,583,002
Industrial Metals Segment			176,226						133,507						703,363						472,159
Climate Segment			130,428						93,148						495,414						370,131
Elimination of intersegment sales			(2,763)						(5,339)						(29,462)						(27,249)
Net sales			$	956,357					$	675,851					$	3,769,345					$	2,398,043
Operating income:
Piping Systems Segment			$	142,482					$	43,106					$	486,287					$	165,719
Industrial Metals Segment			27,077						15,662						85,475						54,065
Climate Segment			21,757						13,279						85,536						56,802
Unallocated expenses			(19,175)						(7,043)						(1,453)						(30,748)
Operating income			$	172,141					$	65,004					$	655,845					$	245,838

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

(In thousands)			December 25, 2021						December 26, 2020
ASSETS
Cash and cash equivalents			$	87,924					$	119,075
Accounts receivable, net			471,859						357,532
Inventories			430,244						315,002
Other current assets			28,976						33,752
Total current assets			1,019,003						825,361
Property, plant, and equipment, net			385,562						376,572
Operating lease right-of-use assets			23,510						29,301
Other assets			300,861						297,334
			$	1,728,936					$	1,528,568
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of debt			$	811					$	41,283
Accounts payable			180,793						147,741
Current portion of operating lease liabilities			6,015						6,259
Other current liabilities			194,820						144,360
Total current liabilities			382,439						339,643
Long-term debt			1,064						286,593
Pension and postretirement liabilities			17,533						26,841
Environmental reserves			17,678						21,256
Deferred income taxes			14,347						16,842
Noncurrent operating lease liabilities			17,099						21,602
Other noncurrent liabilities			21,813						14,731
Total liabilities			471,973						727,508
Total Mueller Industries, Inc. stockholders’ equity			1,222,118						776,745
Noncontrolling interests			34,845						24,315
Total equity			1,256,963						801,060
			$	1,728,936					$	1,528,568

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

			For the Year Ended
(In thousands)			December 25, 2021						December 26, 2020
Cash flows from operating activities
Consolidated net income			$	475,124					$	143,649
Reconciliation of consolidated net income to net cash provided by operating activities:
Depreciation and amortization			45,655						45,162
Stock-based compensation expense			9,822						8,570
Provision for doubtful accounts receivable			1,216						1,208
Loss from unconsolidated affiliates			157						10,219
Non-cash pension plan termination expense			—						11,642
Gain on sale of businesses			(57,760)						—
(Gain) loss on disposals of assets			(769)						132
Redemption premium			5,674						—
Impairment charges			2,829						3,771
Deferred income tax expense (benefit)			7,413						(4,046)
Changes in assets and liabilities, net of effects of businesses acquired and sold:
Receivables			(124,708)						(76,404)
Inventories			(119,514)						5,207
Other assets			919						20,609
Current liabilities			73,755						74,097
Other liabilities			(5,467)						(1,142)
Other, net			(2,645)						2,399
Net cash provided by operating activities			311,701						245,073
Cash flows from investing activities
Proceeds from sale of assets, net of cash transferred			2,302						181
Proceeds from sale of business, net of cash sold			81,884						—
Acquisition of businesses, net of cash acquired			(30,206)						(72,648)
Capital expenditures			(31,833)						(43,885)
Payment received for (issuance of) notes receivable			8,539						(9,270)
Investments in unconsolidated affiliates			(1,613)						—
Net cash provided by (used in) investing activities			29,073						(125,622)

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED

(Unaudited)

			For the Year Ended
(In thousands)			December 25, 2021						December 26, 2020
Cash flows from financing activities
Dividends paid to stockholders of Mueller Industries, Inc.			(29,137)						(22,341)
Dividends paid to noncontrolling interests			(9,722)						—
Issuance of long-term debt			595,000						190,038
Repayments of long-term debt			(920,610)						(246,898)
Repayment of debt by consolidated joint ventures, net			(5,113)						(259)
Repurchase of common stock			(4,864)						(5,574)
Payment of contingent consideration			(1,250)						(7,000)
Net cash received (used) to settle stock-based awards			85						(230)
Debt issuance costs			(1,111)						—
Net cash used in financing activities			(376,722)						(92,264)
Effect of exchange rate changes on cash			(1,052)						2,147
(Decrease) increase in cash, cash equivalents, and restricted cash			(37,000)						29,334
Cash, cash equivalents, and restricted cash at the beginning of the year			127,376						98,042
Cash, cash equivalents, and restricted cash at the end of the year			$	90,376					$	127,376

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