Mueller Industries, Inc. Reports First Quarter 2013 Results

News provided by

Mueller Industries, Inc.

23 Apr, 2013, 11:00 GMT

MEMPHIS, Tennessee, April 23, 2013 /PRNewswire/ -- Mueller Industries, Inc. (NYSE: MLI) announced today that net income for the first quarter of 2013 was $26.2 million or 93 cents per diluted share, compared with net income of $32.6 million or 85 cents per diluted share in 2012. The first quarter of 2013 included non-recurring gains of 7 cents versus 15 cents for the same quarter of 2012.

Our earnings per share were favorably affected by the repurchase of 10.4 million of our shares in September of 2012. By this purchase, our outstanding shares were reduced from 38.5 million shares to 28.1 million shares.

Net sales for the first quarter of 2013 were $559.7 million compared with $577.7 million for the same quarter of the prior year. The difference in sales was largely due to (i) the decline in copper prices, which averaged $3.60 per pound in the first quarter of 2013 versus $3.78 per pound in the first quarter of 2012, and (ii) slightly lower unit volume in our OEM segment.

Our financial condition remains strong. We ended the quarter with:

  • $184 million of cash on hand or $6.54 per share,
  • $556 million of equity and a debt to total capitalization ratio of 31.9 percent, and
  • a current ratio of 2.8 to 1.

Regarding the outlook for 2013, Greg Christopher, CEO, said, "For the first time since mid-2008, housing starts rose to a 1.04 million seasonally adjusted rate in March 2013. Historically, the commercial and industrial segments of the construction industry have, with some lag in time, followed the improvement in the housing segment. We believe that as the year progresses, we will benefit from the increasing vigor of these markets."

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: (i) the construction of new homes; (ii) the improvement and reconditioning of existing homes and structures; and (iii) the commercial construction market which includes office buildings, factories, hotels, hospitals, etc.

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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 "pro forma", "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.


MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)













For the Quarter Ended



March 30,


March 31,



2013


2012



(Unaudited)






Net sales


$    559,690


$    577,668






Cost of goods sold


482,850


493,175

Depreciation and amortization


8,154


7,529

Selling, general, and administrative expense


31,343


31,602

Insurance settlement


-


(1,500)






Operating income


37,343


46,862






Interest expense


(596)


(2,637)

Other income, net


3,163


254






Income before income taxes


39,910


44,479






Income tax expense


(13,476)


(11,662)






Consolidated net income


26,434


32,817






Net income attributable to noncontrolling interest


(232)


(218)






Net income attributable to Mueller Industries, Inc.


$     26,202


$     32,599






Weighted average shares





for basic earnings per share


27,822


38,014

Effect of dilutive stock-based awards


374


444






Adjusted weighted average shares





for diluted earnings per share


28,196


38,458






Basic earnings per share


$       0.94


$       0.86






Diluted earnings per share


$       0.93


$       0.85






Dividends per share


$      0.125


$       0.10






Summary Segment Data:





Net sales:





Plumbing & Refrigeration Segment


$    311,814


$    315,354

OEM Segment


253,787


270,976

Elimination of intersegment sales


(5,911)


(8,662)






Net sales


$    559,690


$    577,668






Operating income:





Plumbing & Refrigeration Segment


$     22,625


$     28,258

OEM Segment


20,323


24,725

Unallocated expenses


(5,605)


(6,121)






Operating income


$     37,343


$     46,862








MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)


























March 30,


December 29,





2013


2012





(Unaudited)



ASSETS







Cash and cash equivalents


$    183,866


$    198,934



Accounts receivable, net


311,601


271,093



Inventories


228,211


229,434



Other current assets


61,479


47,733










    Total current assets


785,157


747,194










Property, plant, and equipment, net


233,959


233,263



Other assets


123,797


123,698












$  1,142,913


$  1,104,155
























LIABILITIES AND STOCKHOLDERS' EQUITY






Current portion of debt


$     53,575


$     27,570



Accounts payable


82,140


87,574



Other current liabilities


145,785


143,552










    Total current liabilities


281,500


258,696










Long-term debt


207,050


207,300



Pension and postretirement liabilities


53,293


55,019



Environmental reserves


22,438


22,597



Deferred income taxes


21,228


20,910



Other noncurrent liabilities


945


1,667










    Total liabilities


586,454


566,189










Total Mueller Industries, Inc. stockholders' equity


525,202


506,908



Noncontrolling interest


31,257


31,058










    Total equity


556,459


537,966












$  1,142,913


$  1,104,155












MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)












For the Quarter Ended





March 30,


March 31,





2013


2012





(Unaudited)

Operating activities:





Consolidated net income


$     26,434


$     32,817

Reconciliation of net income to net cash used in operating activities:







Depreciation and amortization


8,250


7,621



Stock-based compensation expense


946


898



Insurance settlement


-


(1,500)



Insurance proceeds - noncapital related


-


9,000



(Gain) loss on disposal of properties


(3,003)


26



Deferred income taxes


(1,313)


(2,470)



Income tax benefit from exercise of stock options


(30)


(21)



Changes in assets and liabilities:







Receivables


(42,680)


(66,992)



Inventories


212


(13,744)



Other assets


2,585


(1,294)



Current liabilities


(5,365)


24,688



Other liabilities


(753)


151



Other, net


(198)


38








Net cash used in operating activities


(14,915)


(10,782)








Investing activities:





Capital expenditures


(9,835)


(9,340)

Insurance proceeds for property damage


-


32,500

Net (deposits in) withdrawals from restricted cash balances


(14,800)


2,166

Proceeds from sales of properties


3,002


87








Net cash (used in) provided by investing activities


(21,633)


25,413








Financing activities:





Dividends paid


(3,479)


(3,802)

Debt issuance costs


(50)


-

Issuance of debt by joint venture, net


26,060


899

Repayment of long-term debt


(250)


(250)

Net cash received to settle stock-based awards


65


73

Income tax benefit from exercise of stock options


30


21








Net cash provided by (used in) financing activities


22,376


(3,059)








Effect of exchange rate changes on cash


(896)


1,151








(Decrease) increase in cash and cash equivalents


(15,068)


12,723








Cash and cash equivalents at the beginning of the period


198,934


514,162








Cash and cash equivalents at the end of the period


$    183,866


$    526,885