FOR IMMEDIATE RELEASE Contact:Kent A. McKee Memphis, TN--February 5, 2009 (901) 753-3208 MUELLER INDUSTRIES, INC. REPORTS FOURTH QUARTER AND FISCAL 2008 EARNINGS Harvey L. Karp, Chairman of Mueller Industries, Inc. (NYSE: MLI), announced today that Mueller's net income for the fiscal year ended December 27, 2008 was $80.8 million, or $2.17 per diluted share, which compares with $115.5 million, or $3.10 per diluted share, for 2007. Net sales for 2008 were $2.56 billion compared with $2.70 billion in 2007. For the fourth quarter of 2008, the Company's net income was $7.8 million, or 21 cents per diluted share, on net sales of $435.4 million. This compares with net income of $28.8 million, or 78 cents per diluted share, on net sales of $621.7 million for the fourth quarter of 2007. During the fourth quarter of 2008, the Company recognized several special items that, in aggregate, decreased net income by $2.0 million, or 5 cents per diluted share. The special items are described below. Financial and Operating Highlights Mr. Karp said: - "The reduction in net sales was primarily due to lower unit shipments as well as the lower average cost of copper, the Company's principal raw material, which is generally passed through to customers by changes in selling prices. The price of copper was volatile during 2008 and declined substantially during the fourth quarter; the Comex average price of copper during the fourth quarter was $1.75 per pound in 2008 versus $3.25 in 2007. - "Cash provided by operating activities was $180.9 million in 2008 compared with $185.8 million during 2007. - "For the full year, our Plumbing & Refrigeration segment posted operating earnings of $106.8 million on net sales of $1.40 billion which compares with operating earnings of $178.4 million on net sales of $1.57 billion in 2007. Operating earnings decreased primarily due to lower shipment volumes and higher per unit conversion costs on lower production volumes. Page 1 of 7 - "Our OEM segment posted operating earnings of $45.3 million during the year on net sales of $1.18 billion, which compares with operating earnings of $38.2 million on net sales of $1.14 billion for 2007. Weak demand in the later part of the year reduced shipments. - "Our current ratio remains strong at 3.7 to 1 and our working capital is $553.2 million, of which over $275 million is cash on hand. - "As of year end, our financial leverage was modest with a debt to total capitalization ratio of 20.7 percent. During 2008, we purchased approximately $149.0 million of our outstanding 6% Subordinated Debentures at discounts off of face value. Gains attributable to these repurchases totaled $19.1 million in the fourth quarter and $21.6 million for the year. - "The special items referred to above are: (i) an impairment charge totaling $18.0 million to reduce the carrying value of goodwill, (ii) additional environmental provisions of $15.0 million pertaining to estimated environmental settlements and obligations, (iii) a nontaxable gain of $19.1 million related to the repurchase of debentures, (iv) LIFO income of $14.9 million due to reduction of the quantities of LIFO inventory, and (v) a charge of $4.9 million to write-down certain inventories to the lower-of-cost-or-market that resulted from falling copper and other metal prices. The goodwill impairment is an estimate that will be adjusted after valuation procedures, including third party valuations, are completed as required by generally accepted accounting principles. - "Our return on average equity was 11.5 percent for 2008 which compares with 17.8 percent for 2007. - "Total stockholders' equity was $700.7 million which equates to a book value per share of $18.86 of which $7.51 per share is in cash. Stockholders' equity was reduced by the impact of foreign currency translations of our operations based in Mexico and the United Kingdom as their respective currencies declined in value relative to the U.S. dollar during the quarter. Page 2 of 7 - "Capital expenditures during 2008 totaled $22.3 million and capital expenditures in 2009 are expected to be between $20 million and $25 million. - "Late in the year, our European copper tube operation was damaged by fire. Production was curtailed for approximately four weeks to make the necessary temporary repairs. Certain production equipment and portions of the building structures were extensively damaged requiring further assessment which is underway; rehabilitation alternatives are also being evaluated. The total value of the loss, including business interruption, cannot be determined at this time but is expected to be covered by our property insurance." Business Outlook for 2009 Regarding the outlook for 2009, Mr. Karp said, "Mueller's operating results for 2008 were gratifying, considering the state of the U.S. economy and the decline in global markets. We are now in the second year of a recession which appears likely to be the longest downturn since World War II. "Mueller's strategy for 2009 is to promptly readjust our operations to the on-going flow of business. We see many opportunities to improve our operations and reduce costs. It is our objective to emerge from the current economic malaise a stronger, more efficient and lower-cost competitor. "Our strong balance sheet will enable us to fund our capital improvement programs from internal sources. We are also investigating acquisition opportunities which are directly related to our core business capabilities. We have always been cautious in evaluating acquisition candidates, and we will continue to do so." 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 which includes office buildings, factories, hotels, hospitals, etc. +++++++++++++++++++++++ Page 3 of 7 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. Page 4 of 7 MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data)