Mueller Industries, Inc. (NYSE: MLI) announces results for the third quarter of 2024. Comparisons are to the third quarter of 2023.
- Net Sales of $997.8 million versus $819.8 million
- Operating Income of $206.7 million versus $181.0 million
- Earnings Before Taxes of $217.8 million versus $189.0 million
- Net Income of $168.7 million versus $132.7 million
- Diluted EPS of $1.48 versus $1.171
Third Quarter Financial and Operating Highlights:
- COMEX copper averaged $4.23 per pound during the quarter, 12.0% higher than in the third quarter of 2023.
- The increase in net sales was attributable to the inclusion of $102.4 million of sales from recently acquired businesses, as well as the higher copper prices.
- Selling, general, and administrative expenses increased primarily due to the inclusion of $3.9 million of operating costs from recently acquired businesses, as well as $2.7 million in transaction related expenses.
- Investments in unconsolidated affiliates contributed $3.2 million of income, as compared with a $2.4 million loss in the prior year period.
- Net cash generated from operations was $231.4 million. Our cash and short-term investments balance was $969.6 million at quarter end, and our current ratio remains strong at 4.9 to 1.
Regarding the quarter performance, Greg Christopher, Mueller’s CEO said, “We continued to deliver very good results, and generated significant cash despite generally restrained business conditions during the quarter. We also made substantial progress toward integrating our two recently acquired businesses, which both contributed positively to our results.”
He continued, “We anticipate that declining interest rates and moderating inflation, combined with the resolution of election related uncertainty, will create a more stable and favorable environment for us. We have an excellent portfolio of businesses serving essential markets; our operations are well capitalized; our balance sheet is strong; and we have proven capable of quickly adjusting and adapting as conditions require. As such, we remain well positioned to take advantage when conditions improve, and will continue to actively pursue new opportunities to expand and grow.”
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1 | Diluted EPS for the second quarter of 2023 has been adjusted retroactively to reflect the two-for-one stock split that took effect on October 20, 2023. |
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.
MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | ||||||||||||||||
For the Quarter Ended | For the Nine Months Ended | |||||||||||||||
(In thousands, except per share data) | September 28, 2024 | September 30, 2023 | September 28, 2024 | September 30, 2023 | ||||||||||||
Net sales | $ | 997,831 | $ | 819,792 | $ | 2,845,230 | $ | 2,687,968 | ||||||||
Cost of goods sold | 722,469 | 579,058 | 2,056,162 | 1,897,128 | ||||||||||||
Depreciation and amortization | 11,710 | 9,631 | 30,897 | 30,704 | ||||||||||||
Selling, general, and administrative expense | 59,619 | 48,295 | 161,993 | 156,988 | ||||||||||||
Gain on sale of assets | (2,667 | ) | — | (3,953 | ) | — | ||||||||||
Gain on sale of business | — | (4,137 | ) | — | (4,137 | ) | ||||||||||
Asset impairments | — | 5,934 | — | 5,934 | ||||||||||||
Gain on insurance settlement | — | — | — | (19,466 | ) | |||||||||||
Operating income | 206,700 | 181,011 | 600,131 | 620,817 | ||||||||||||
Interest expense | (113 | ) | (230 | ) | (335 | ) | (508 | ) | ||||||||
Interest income | 11,145 | 10,599 | 42,773 | 24,566 | ||||||||||||
Realized and unrealized gains (losses) on short-term investments | 164 | (2,368 | ) | 529 | 20,362 | |||||||||||
Other (expense) income, net | (122 | ) | (47 | ) | (848 | ) | 2,120 | |||||||||
Income before income taxes | 217,774 | 188,965 | 642,250 | 667,357 | ||||||||||||
Income tax expense | (49,188 | ) | (50,843 | ) | (159,406 | ) | (174,322 | ) | ||||||||
Income (loss) from unconsolidated affiliates, net of foreign tax | 3,197 | (2,413 | ) | (5,905 | ) | (2,682 | ) | |||||||||
Consolidated net income | 171,783 | 135,709 | 476,939 | 490,353 | ||||||||||||
Net income attributable to noncontrolling interests | (3,084 | ) | (3,000 | ) | (9,712 | ) | (6,694 | ) | ||||||||
Net income attributable to Mueller Industries, Inc. | $ | 168,699 | $ | 132,709 | $ | 467,227 | $ | 483,659 | ||||||||
Weighted average shares for basic earnings per share (1) | 111,363 | 111,416 | 111,332 | 111,374 | ||||||||||||
Effect of dilutive stock-based awards (1) | 2,412 | 2,452 | 2,635 | 2,182 | ||||||||||||
Adjusted weighted average shares for diluted earnings per share (1) | 113,775 | 113,868 | 113,967 | 113,556 | ||||||||||||
Basic earnings per share (1) | $ | 1.51 | $ | 1.19 | $ | 4.20 | $ | 4.34 | ||||||||
Diluted earnings per share (1) | $ | 1.48 | $ | 1.17 | $ | 4.10 | $ | 4.26 | ||||||||
Dividends per share (1) | $ | 0.20 | $ | 0.15 | $ | 0.60 | $ | 0.45 | ||||||||
(1) Adjusted retroactively to reflect the two-for-one stock split that occurred on October 20, 2023. | ||||||||||||||||
MUELLER INDUSTRIES, INC. | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME, CONTINUED | ||||||||||||||||
(Unaudited) | ||||||||||||||||
For the Quarter Ended | For the Nine Months Ended | |||||||||||||||
(In thousands) | September 28, 2024 | September 30, 2023 | September 28, 2024 | September 30, 2023 | ||||||||||||
Summary Segment Data: | ||||||||||||||||
Net sales: | ||||||||||||||||
Piping Systems Segment | $ | 653,884 | $ | 568,151 | $ | 1,932,521 | $ | 1,868,635 | ||||||||
Industrial Metals Segment | 238,014 | 141,012 | 589,422 | 452,512 | ||||||||||||
Climate Segment | 128,482 | 119,949 | 375,824 | 396,857 | ||||||||||||
Elimination of intersegment sales | (22,549 | ) | (9,320 | ) | (52,537 | ) | (30,036 | ) | ||||||||
Net sales | $ | 997,831 | $ | 819,792 | $ | 2,845,230 | $ | 2,687,968 | ||||||||
Operating income: | ||||||||||||||||
Piping Systems Segment | $ | 163,601 | $ | 140,609 | $ | 468,539 | $ | 455,605 | ||||||||
Industrial Metals Segment | 24,197 | 16,221 | 78,161 | 61,407 | ||||||||||||
Climate Segment | 40,768 | 34,846 | 112,336 | 145,901 | ||||||||||||
Unallocated income (expenses) | (21,866 | ) | (10,665 | ) | (58,905 | ) | (42,096 | ) | ||||||||
Operating income | $ | 206,700 | $ | 181,011 | $ | 600,131 | $ | 620,817 | ||||||||
MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(Unaudited) | ||||||
(In thousands) | September 28, 2024 | December 30, 2023 | ||||
ASSETS | ||||||
Cash and cash equivalents | $ | 965,116 | $ | 1,170,893 | ||
Short-term investments | 4,449 | 98,146 | ||||
Accounts receivable, net | 500,617 | 351,561 | ||||
Inventories | 400,252 | 380,248 | ||||
Other current assets | 45,144 | 39,173 | ||||
Total current assets | 1,915,578 | 2,040,021 | ||||
Property, plant, and equipment, net | 506,234 | 385,165 | ||||
Operating lease right-of-use assets | 32,202 | 35,170 | ||||
Other assets | 752,118 | 298,945 | ||||
Total assets | $ | 3,206,132 | $ | 2,759,301 | ||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||
Current portion of debt | $ | 927 | $ | 796 | ||
Accounts payable | 183,511 | 120,485 | ||||
Current portion of operating lease liabilities | 7,681 | 7,893 | ||||
Other current liabilities | 201,874 | 187,964 | ||||
Total current liabilities | 393,993 | 317,138 | ||||
Long-term debt | 19 | 185 | ||||
Pension and postretirement liabilities | 12,082 | 12,062 | ||||
Environmental reserves | 14,696 | 15,030 | ||||
Deferred income taxes | 24,663 | 19,134 | ||||
Noncurrent operating lease liabilities | 24,504 | 26,683 | ||||
Other noncurrent liabilities | 27,539 | 10,353 | ||||
Total liabilities | 497,496 | 400,585 | ||||
Total Mueller Industries, Inc. stockholders’ equity | 2,678,382 | 2,337,445 | ||||
Noncontrolling interests | 30,254 | 21,271 | ||||
Total equity | 2,708,636 | 2,358,716 | ||||
Total liabilities and equity | $ | 3,206,132 | $ | 2,759,301 | ||
MUELLER INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | ||||||||
For the Nine Months Ended | ||||||||
(In thousands) | September 28, 2024 | September 30, 2023 | ||||||
Cash flows from operating activities | ||||||||
Consolidated net income | $ | 476,939 | $ | 490,353 | ||||
Reconciliation of consolidated net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 31,140 | 31,053 | ||||||
Stock-based compensation expense | 19,956 | 17,268 | ||||||
Provision for doubtful accounts receivable | (262 | ) | (63 | ) | ||||
Loss from unconsolidated affiliates | 5,905 | 2,682 | ||||||
Dividends from unconsolidated affiliates | 4,130 | — | ||||||
Insurance proceeds - noncapital related | 15,000 | 9,854 | ||||||
Gain on disposals of properties | (3,953 | ) | (106 | ) | ||||
Gain on sale of business | — | (4,137 | ) | |||||
Unrealized gain on short-term investments | (164 | ) | (18,449 | ) | ||||
Gain on sales of securities | (365 | ) | — | |||||
Impairment charges | — | 5,934 | ||||||
Gain on insurance settlement | — | (19,466 | ) | |||||
Deferred income tax expense | 1,837 | 3,803 | ||||||
Changes in assets and liabilities, net of effects of businesses acquired: | ||||||||
Receivables | (99,281 | ) | (36,855 | ) | ||||
Inventories | 34,027 | 53,372 | ||||||
Other assets | (3,175 | ) | (12,897 | ) | ||||
Current liabilities | 25,303 | (25,503 | ) | |||||
Other liabilities | (2,467 | ) | (1,828 | ) | ||||
Other, net | 1,217 | 3,475 | ||||||
Net cash provided by operating activities | $ | 505,787 | $ | 498,490 | ||||
Cash flows from investing activities | ||||||||
Capital expenditures | $ | (51,288 | ) | $ | (39,469 | ) | ||
Acquisition of businesses, net of cash acquired | (602,692 | ) | — | |||||
Investments in unconsolidated affiliates | (8,700 | ) | (3,999 | ) | ||||
Insurance proceeds - capital related | — | 24,646 | ||||||
Purchase of short-term investments | (4,285 | ) | (106,231 | ) | ||||
Purchase of long-term investments | (7,976 | ) | — | |||||
Proceeds from the maturity of short-term investments | — | 217,863 | ||||||
Proceeds from the sale of securities | 98,465 | — | ||||||
Issuance of notes receivable | (3,800 | ) | — | |||||
Proceeds from sales of properties | 9,026 | 214 | ||||||
Dividends from unconsolidated affiliates | — | 1,093 | ||||||
Net cash (used in) provided by investing activities | $ | (571,250 | ) | $ | 94,117 | |||
MUELLER INDUSTRIES, INC. | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
(Unaudited) | ||||||||
For the Nine Months Ended | ||||||||
(In thousands) | September 28, 2024 | September 30, 2023 | ||||||
Cash flows from financing activities | ||||||||
Dividends paid to stockholders of Mueller Industries, Inc. | $ | (66,796 | ) | $ | (50,133 | ) | ||
Repurchase of common stock | (48,681 | ) | (19,303 | ) | ||||
Repayments of debt | (167 | ) | (185 | ) | ||||
Issuance (repayment) of debt by consolidated joint ventures, net | 144 | (265 | ) | |||||
Net cash used to settle stock-based awards | (22,946 | ) | (9,113 | ) | ||||
Net cash used in financing activities | $ | (138,446 | ) | $ | (78,999 | ) | ||
Effect of exchange rate changes on cash | (4,709 | ) | 2,312 | |||||
(Decrease) increase in cash, cash equivalents, and restricted cash | (208,618 | ) | 515,920 | |||||
Cash, cash equivalents, and restricted cash at the beginning of the period | 1,174,223 | 465,296 | ||||||
Cash, cash equivalents, and restricted cash at the end of the period | $ | 965,605 | $ | 981,216 | ||||
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