Mueller Water Products Inc (MWA, Financial) released its 8-K filing on November 6, 2024, reporting its financial results for the fourth quarter and full fiscal year 2024. The company, a leading U.S.-based manufacturer of water transmission, distribution, and measurement products, operates through its Water Flow Solutions and Water Management Solutions segments.
Quarterly and Annual Financial Performance
In the fourth quarter, Mueller Water Products Inc (MWA, Financial) reported net sales of $348.2 million, surpassing the analyst estimate of $324.80 million, marking a 15.5% increase from the prior year. The company achieved an adjusted net income per diluted share of $0.22, aligning with analyst expectations, and an adjusted EBITDA of $72.5 million, reflecting a 30.9% increase from the previous year.
For the full fiscal year, the company reported net sales of $1.314 billion, slightly above the annual estimate of $1.287 billion, and an adjusted net income per diluted share of $0.96, exceeding the estimated $0.86. The adjusted EBITDA for the year was $284.7 million, a significant 40.9% increase from the prior year.
Key Achievements and Challenges
Mueller Water Products Inc (MWA, Financial) achieved record net sales and margins in fiscal 2024, driven by increased volumes, favorable pricing, and operational efficiencies. The company also reported a substantial improvement in free cash flow, which increased by $130 million year-over-year. However, the company faced challenges, including a $16.3 million non-cash goodwill impairment and an $8.7 million warranty charge in the Water Management Solutions segment.
“We delivered a strong fourth quarter with healthy order levels supported by steady end market demand and focused customer service. We achieved record fourth quarter net sales and adjusted EBITDA, which exceeded our expectations and continued to expand margins through increased volumes, consistent operational execution and disciplined SG&A spending,” said Martie Edmunds Zakas, Chief Executive Officer of Mueller Water Products.
Segment Performance
The Water Flow Solutions segment saw a 24.0% increase in net sales to $200.3 million, driven by higher volumes and pricing. The segment's adjusted operating income rose by 51.3% to $41.6 million, with an adjusted EBITDA margin of 25.8%. Meanwhile, the Water Management Solutions segment reported a 5.7% increase in net sales to $147.9 million, with an adjusted operating income of $29.8 million, despite the goodwill impairment and warranty charge.
Financial Metrics and Balance Sheet
Mueller Water Products Inc (MWA, Financial) reported a net income of $115.9 million for the fiscal year, with a net income margin of 8.8%. The company's balance sheet showed total assets of $1.636 billion, with cash and cash equivalents of $309.9 million. The debt leverage ratio was 1.6 times, with no borrowings under the ABL Agreement at the end of the fourth quarter.
Analysis and Outlook
Mueller Water Products Inc (MWA, Financial) demonstrated resilience and operational strength in fiscal 2024, achieving record sales and profitability despite external challenges. The company's focus on operational efficiencies and strategic investments positions it well for continued growth. Looking ahead, the company anticipates further sales growth and margin improvement in fiscal 2025, supported by manufacturing performance and favorable market trends.
Mueller Water Products Inc (MWA, Financial) remains committed to investing in its operations and returning cash to shareholders, with plans for continued share repurchases and dividend increases. The company's strategic focus on addressing aging water infrastructure and leveraging federal infrastructure spending is expected to drive long-term growth.
Explore the complete 8-K earnings release (here) from Mueller Water Products Inc for further details.
