TO OUR STOCKHOLDERS Mueller's earnings rose 34 percent for the first quarter of 1994 compared with the same quarter of 1993. Earnings were $5.6 million, or 54 cents per share on 10,437,000 average shares outstanding, compared to earnings of $4.2 million, or 41 cents per share on 10,372,000 average shares outstanding, for the first quarter of 1993. We are gratified that the earnings increase was achieved despite harsh weather conditions which prevailed during most of the first quarter this year. However, productivity increases, yield improvements and cost reductions contributed to improved profit margins. Net sales for the first quarter of 1994 totaled $120.8 million, compared to $131.0 million for the first quarter of 1993. As we have previously noted, Mueller's sales dollars are significantly affected by the price of copper, our principal raw material. Average copper prices were fourteen percent lower in the first quarter of 1994 compared to the same period of 1993. Our capital improvement programs continue to show good progress. The $20 million expansion of our Fulton, Mississippi copper tube plant has commenced and the equipment has been ordered. The State of Mississippi, through tax credits and an industrial revenue bond facility, has enabled us to finance this project on attractive terms. Also, the $15 million modernization program at our Port Huron, Michigan brass rod mill is underway. These programs are scheduled to be completed in the latter half of 1995. Other capital improvement projects are being evaluated including a major upgrading of our copper fittings manufacturing operations. We believe these programs will provide a sound foundation for our growth and profitability. We are pleased to report that Mueller has entered into five-year contracts with the unions representing our production workers in Michigan and Mississippi. Labor contracts of this length are possible only when the parties are committed to teamwork and cooperation. Mueller operates in a highly competitive global environment, and we recognize that teamwork is an essential ingredient to our success. Our annual stockholders' meeting will be held on May 12, 1994 in Wichita, Kansas. We invite each stockholder to attend, but if you cannot attend, please return your proxy card promptly. 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 April 22, 1994 MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands, except share data)
For the Quarter Ended March 26, 1994 March 27, 1993 Net sales $ 120,812 $ 131,037 Costs and expenses 110,861 123,189 ------- ------- Operating income 9,951 7,848 Non operating expense, net 992 863 ------- ------- Income before taxes 8,959 6,985 Income tax expense 3,322 2,772 ------- ------- Net income $ 5,637 $ 4,213 ======= ======= Earnings per common and common equivalent share: Primary $ 0.54 $ 0.41 ======= ======= Fully diluted $ 0.54 $ 0.41 ======= =======
MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except share data)
March 26, 1994 December 25, 1993 Assets Current assets $ 201,689 $ 194,411 Property, plant and equipment, net 156,388 154,403 Other assets 35,015 20,929 ------- ------- $ 393,092 $ 369,743 ======= ======= Liabilities and Stockholders' Equity Current liabilities $ 54,565 $ 50,906 Long-term debt 69,654 54,320 Other noncurrent liabilities 41,500 42,403 ------- ------- Total liabilities 165,719 147,629 ------- ------- Stockholders' equity: Common stock 100 100 Paid-in capital, common 236,293 236,406 Accumulated deficit (since January, 1991) (302) (5,939) Cumulative translation adjustments (2,435) (1,944) Treasury common stock at cost (6,283) (6,509) ------- ------- Total stockholders' equity 227,373 222,114 ------- ------- $ 393,092 $ 369,743 ======= ======= Book value per share $ 23.69 $ 23.18 ======= =======
DIRECTORS AND OFFICERS DIRECTORS Harvey L. Karp Chairman of the Board Mueller Industries, Inc. Ray C. Adam (1) (2) Private Investor Rodman L. Drake (2) (3) President of Rodman L. Drake & Co., Inc. Gary S. Gladstein (1) (2) Managing Director of Soros Fund Management Allan Mactier (1) (3) Private Investor William D. O'Hagan President and Chief Executive Officer Mueller Industries, Inc. Robert J. Pasquarelli (1) Chief Executive Officer of New Jersey Steel Corporation Paul Soros Private Investor OFFICERS Harvey L. Karp Chairman of the Board William D. O'Hagan President and Chief Executive Officer Earl W. Bunkers Executive Vice President and Chief Financial Officer Harvey W. Clements Vice President and General Manager - Tube Division John B. Hansen Vice President and General Manager- Fittings Division William H. Hensley Vice President, General Counsel and Secretary Lee R. Nyman Vice President - Manufacturing/Management Engineering James H. Rourke Vice President and General Manager - Industrial Division Roy C. Harris Corporate Controller Kent A. McKee Treasurer and Assistant Secretary Mueller Industries, Inc. / 2959 N. Rock Road / Wichita, KS 67226 / (316) 636-6300 [FN] (1) Member of the Audit Committee (2) Member of the Compensation Committee (3) Member of the Nominating Committee