MUELLER INDUSTRIES INC - FORM 8-K - April 25, 2017


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
 
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
April 25, 2017
mlia03.jpg
   MUELLER INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
  
  Delaware
  1-6770
  25-0790410
(State or other
(Commission File
(IRS Employer
jurisdiction of
Number)
Identification No.)
incorporation)
 
 
  
8285 Tournament Drive, Suite 150
  Memphis, Tennessee
38125
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code:
  (901) 753-3200
Registrant’s Former Name or Address, if changed since last report:
  N/A
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) 
 
 
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) 
 
 
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) 
 
 
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) 
 
 Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new of revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 


Item 2.02.
Results of Operations and Financial Condition.

On April 25, 2017, the Registrant issued a press release announcing earnings for the quarter ended April 1, 2017. A copy of the press release announcing the first quarter 2017 earnings is attached as Exhibit 99.1.

Item 9.01.
Financial Statements and Exhibits.
 
(d) Exhibits
 
 
99.1
Press release, dated April 25, 2017 reporting first quarter 2017 earnings.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 






















 SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
MUELLER INDUSTRIES, INC.
 
 
 
By:
/s/ JEFFREY A. MARTIN
 
 
Name:
Jeffrey A. Martin
 
Title:
Chief Financial Officer and Treasurer
 
 
 
Date:  April 25, 2017
 
 


 


 
























Exhibit Index
 
Exhibit No.
Description 
 
 
99.1
Press release, dated April 25, 2017.



 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

























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Mueller Industries, Inc. Reports First Quarter 2017 Earnings

MEMPHIS, Tenn., April 25, 2017 -- Mueller Industries, Inc. (NYSE: MLI) announced today operating income of $45.6 million for the first quarter of 2017, a 10 percent increase over the same period in 2016. Net income for the period was $30.0 million, or 52 cents per diluted share, compared with net income of $28.6 million, or 50 cents per diluted share in the prior year. Net sales for the first quarter of 2017 were $577.9 million compared with $532.8 million in the same quarter of 2016.

Financial and Operating Highlights for the first quarter of 2017:
•
The first quarter of 2017 contained one less week compared with the first quarter of 2016, a 7 percent decrease in shipping days.
•
Net sales impacts:
–
The average price of copper rose 26 percent, or 55 cents per pound, compared with the same period of 2016. This positively influenced net sales to the tune of $66.8 million.
–
The aforementioned shorter period in 2017 resulted in a reduction in net sales of approximately $31.0 million.
•
The period included a loss of $1.2 million from Tecumseh Products Co., an unconsolidated affiliate, versus net income of $2.9 million in the same period of 2016.
•
At quarter end, cash totaled $146.9 million, equal to $2.55 per share, after the $179.8 million in cash dividends distributed during the quarter.
•
On March 9, 2017, the Company distributed a special dividend of $8.00 per share, consisting of $3.00 in cash and $5.00 in principal amount of the Company’s 6% Subordinated Debentures due in 2027. The effect of the special dividend was a decrease in stockholders’ equity of approximately $458.7 million, an increase in long-term debt of approximately $284.5 million, and a decrease in cash of approximately $174.2 million.
•
The Company also paid a regular quarterly cash dividend of 10 cents per share.

Regarding the outlook, Greg Christopher, Mueller CEO, said, “The year started where 2016 left off. The primary drivers of the U.S. businesses continue on a path of steady improvement and we remain optimistic that the international markets will improve over time.”







5


Mueller Industries, Inc. is an industrial manufacturer that specializes in copper and copper alloy manufacturing while also producing goods made from aluminum, steel, and plastics. It is headquartered in Memphis, Tennessee and comprises a network of operations in the United States, Canada, Mexico, Great Britain, South Korea, and China. Its products include tubing, fittings, valves, vessels, and related items for plumbing and HVACR related piping systems, as well as rod, forgings, extrusions, and various components for OEM applications. Products are distributed into sectors such as building construction, appliance, defense, energy, and automotive.

*********************

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.

CONTACT
Jeffrey A. Martin
(901)753-3226
























6


MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
 
 
For the Quarter Ended
(In thousands, except per share data)
 
April 1, 2017
 
April 2, 2016
 
 
 
 
 
Net sales
 
$
577,920

 
$
532,809

 
 
 
 
 
Cost of goods sold
 
488,427

 
446,642

Depreciation and amortization
 
8,355

 
8,920

Selling, general, and administrative expense
 
35,531

 
35,780

 
 
 
 
 
Operating income
 
45,607

 
41,467

 
 
 
 
 
Interest expense
 
(2,531
)
 
(1,848
)
Other income, net
 
551

 
245

 
 
 
 
 
Income before income taxes
 
43,627

 
39,864

 
 
 
 
 
Income tax expense
 
(11,929
)
 
(14,121
)
(Loss) income from unconsolidated affiliates, net of tax
 
(1,243
)
 
2,922

 
 
 
 
 
Consolidated net income
 
30,455

 
28,665

 
 
 
 
 
Net income attributable to noncontrolling interests
 
(468
)
 
(35
)
 
 
 
 
 
Net income attributable to Mueller Industries, Inc.
 
$
29,987

 
$
28,630

 
 
 
 
 
Weighted average shares for basic earnings per share
 
56,780

 
56,467

Effect of dilutive stock-based awards
 
658

 
495

 
 
 
 
 
Adjusted weighted average shares for diluted earnings per share
 
57,438

 
56,962

 
 
 
 
 
Basic earnings per share
 
$
0.53

 
$
0.51

 
 
 
 
 
Diluted earnings per share
 
$
0.52

 
$
0.50

 
 
 
 
 
Dividends per share
 
$
8.100

 
$
0.075

 
 
 
 
 
Summary Segment Data:
 
 
 
 
 
 
 
 
 
Net sales:
 
 
 
 
    Piping Systems Segment
 
$
398,775

 
$
368,890

    Industrial Metals Segment
 
149,837

 
134,521

    Climate Segment
 
34,279

 
30,706

    Elimination of intersegment sales
 
(4,971
)
 
(1,308
)
 
 
 
 
 
Net sales
 
$
577,920

 
$
532,809

 
 
 
 
 
Operating income:
 
 
 
 
    Piping Systems Segment
 
$
30,366

 
$
31,159

    Industrial Metals Segment
 
20,666

 
19,912

    Climate Segment
 
5,610

 
3,879

    Unallocated expenses
 
(11,035
)
 
(13,483
)
 
 
 
 
 
Operating income
 
$
45,607

 
$
41,467


7

MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
(In thousands)
April 1, 2017
 
December 31, 2016
ASSETS
 
 
 
Cash and cash equivalents
$
146,891

 
$
351,317

Accounts receivable, net
312,095

 
256,291

Inventories
251,958

 
242,013

Other current assets
45,141

 
44,702

 
 
 
 
    Total current assets
756,085

 
894,323

 
 
 
 
Property, plant, and equipment, net
296,360

 
295,231

Other assets
252,476

 
257,922

 
 
 
 
 
$
1,304,921

 
$
1,447,476

 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current portion of debt
$
14,939

 
$
13,655

Accounts payable
117,251

 
103,175

Other current liabilities
99,498

 
102,162

 
 
 
 
    Total current liabilities
231,688

 
218,992

 
 
 
 
Long-term debt
489,787

 
213,709

Pension and postretirement liabilities
31,012

 
31,273

Environmental reserves
20,993

 
21,208

Deferred income taxes
18,249

 
19,573

Other noncurrent liabilities
6,447

 
6,284

 
 
 
 
    Total liabilities
798,176

 
511,039

 
 
 
 
Total Mueller Industries, Inc. stockholders’ equity
467,875

 
898,684

Noncontrolling interests
38,870

 
37,753

 
 
 
 
    Total equity
506,745

 
936,437

 
 
 
 
 
$
1,304,921

 
$
1,447,476













8

MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

 
For the Quarter Ended
 (In thousands)
April 1, 2017
 
April 2, 2016
 
 
 
 
Cash flows from operating activities
 
 
 
Consolidated net income
$
30,455

 
$
28,665

Reconciliation of consolidated net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
8,419

 
9,011

Stock-based compensation expense
1,736

 
1,236

Loss (income) from unconsolidated affiliates
1,243

 
(2,922
)
Gain on disposals of assets
(16
)
 
(23
)
Gain on sales of securities
(254
)
 
—

Deferred income taxes
(80
)
 
1,895

Income tax benefit from exercise of stock options
—

 
(96
)
Changes in assets and liabilities, net of businesses acquired:

 
 
Receivables
(53,756
)
 
(25,089
)
Inventories
(6,991
)
 
(1,631
)
Other assets
1,205

 
(370
)
Current liabilities
8,215

 
655

Other liabilities
(668
)
 
(704
)
Other, net
(930
)
 
(291
)
 
 
 
 
Net cash (used in) provided by operating activities
(11,422
)
 
10,336

 
 
 
 
Cash flows from investing activities
 
 
 
Capital expenditures
(7,345
)
 
(5,892
)
Net (deposits in) withdrawals from restricted cash balances
(1,403
)
 
84

Proceeds from sales of assets
192

 
1

Proceeds from sales of securities
1,444

 
—

 
 
 
 
Net cash used in investing activities
(7,112
)
 
(5,807
)
 
 
 
 
Cash flows from financing activities
 
 
 
Dividends paid to stockholders of Mueller Industries, Inc.
(179,848
)
 
(4,236
)
Issuance of long-term debt
—

 
2,000

Repayment of debt by consolidated joint ventures, net
(7,367
)
 
(7,024
)
Net cash (used) received to settle stock-based awards
(870
)
 
361

Repayments of long-term debt
(306
)
 
(250
)
Income tax benefit from exercise of stock options
—

 
96

 
 
 
 
Net cash used in financing activities
(188,391
)
 
(9,053
)
 
 
 
 
Effect of exchange rate changes on cash
2,499

 
(171
)
 
 
 
 
Decrease in cash and cash equivalents
(204,426
)
 
(4,695
)
Cash and cash equivalents at the beginning of the period
351,317

 
274,844

 
 
 
 
Cash and cash equivalents at the end of the period
$
146,891

 
$
270,149



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