Mueller Industries Inc 10-Q for FY2024 Q2

Mueller Industries Inc (MLI)

10-Q 2024-07-24 For: 2024-06-29

Added on April 09, 2026

About this 10-Q

Mueller Industries Inc filed this 10-Q on July 24, 2024, covering the quarter ended June 29, 2024 (FY2024 Q2).

Headline figures

Quarter ended June 29, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $997.75M; up 11.2% from $896.98M a year earlier
Net income: $160.17M; down 9.9% from net income of $177.71M a year earlier
Diluted EPS: $1.41; down 9.6% from $1.56 a year earlier

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☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
			For the quarterly report ended June 29, 2024
			OR
☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
			For the transition period from ______ to ______
			Commission file number 1-6770


Delaware			25-0790410
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)


150 Schilling Boulevard	Suite 100
Collierville	Tennessee	38017
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol	Name of exchange on which registered
Common Stock	MLI	NYSE


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐


		Page Number
Part I. Financial Information

	Item 1. – Financial Statements (Unaudited)

	a.) Condensed Consolidated Statements of Income	3

	b.) Condensed Consolidated Statements of Comprehensive Income	4

	c.) Condensed Consolidated Balance Sheets	5

	d.) Condensed Consolidated Statements of Cash Flows	7

	e.) Condensed Consolidated Statements of Changes in Equity	9

	f.) Notes to Condensed Consolidated Financial Statements	11

	Item 2. – Management's Discussion and Analysis of Financial Condition and Results of Operations	27

	Item 3. – Quantitative and Qualitative Disclosures About Market Risk	37

	Item 4. – Controls and Procedures	39

Part II. Other Information

	Item 1. – Legal Proceedings	39

	Item 1A. – Risk Factors	39

	Item 2. – Unregistered Sales of Equity Securities and Use of Proceeds	40

	Item 5. – Other Information	40

	Item 6. – Exhibits	41

Signatures		42


	For the Quarter Ended				For the Six Months Ended
(In thousands, except per share data)	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023

Net sales	$	997,745	$	896,984	$	1,847,399	$	1,868,176

Cost of goods sold	724,990		639,272		1,333,693		1,318,070
Depreciation and amortization	10,018		10,416		19,187		21,073
Selling, general, and administrative expense	52,731		56,062		101,088		108,693




Gain on insurance settlement	—		(19,466)		—		(19,466)

Operating income	210,006		210,700		393,431		439,806

Interest expense	(107)		(135)		(222)		(278)
Interest income	14,383		7,732		31,628		13,967
Realized and unrealized gains on short-term investments	—		20,820		365		22,730
Other (expense) income, net	(1,356)		1,841		(726)		2,167

Income before income taxes	222,926		240,958		424,476		478,392

Income tax expense	(58,384)		(62,122)		(110,218)		(123,479)
(Loss) income from unconsolidated affiliates, net of foreign tax	(1,095)		715		(9,102)		(269)

Consolidated net income	163,447		179,551		305,156		354,644
Net income attributable to noncontrolling interests	(3,282)		(1,840)		(6,628)		(3,694)

Net income attributable to Mueller Industries, Inc.	$	160,165	$	177,711	$	298,528	$	350,950

Weighted average shares for basic earnings per share (1)	111,216		111,320		111,316		111,354
Effect of dilutive stock-based awards (1)	2,763		2,680		2,746		2,046

Adjusted weighted average shares for diluted earnings per share (1)	113,979		114,000		114,062		113,400

Basic earnings per share (1)	$	1.44	$	1.60	$	2.68	$	3.15

Diluted earnings per share (1)	$	1.41	$	1.56	$	2.62	$	3.09

Dividends per share (1)	$	0.20	$	0.15	$	0.40	$	0.30


	For the Quarter Ended				For the Six Months Ended
(In thousands)	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023

Consolidated net income	$	163,447	$	179,551	$	305,156	$	354,644

Other comprehensive (loss) income, net of tax:
Foreign currency translation	(7,871)		7,725		(12,026)		17,976
Net change with respect to derivative instruments and hedging activities, net of tax of $214, $775, $121 and $503	(746)		(2,679)		(419)		(1,725)
Net change in pension and postretirement obligation adjustments, net of tax of $38, $1, $21 and $12	(93)		9		(57)		1
Attributable to unconsolidated affiliates, net of tax of $65, $(103), $460 and $(476)	(221)		353		(1,583)		1,638

Total other comprehensive (loss) income, net	(8,931)		5,408		(14,085)		17,890

Consolidated comprehensive income	154,516		184,959		291,071		372,534
Comprehensive income attributable to noncontrolling interests	(2,759)		(1,546)		(5,484)		(3,658)

Comprehensive income attributable to Mueller Industries, Inc.	$	151,757	$	183,413	$	285,587	$	368,876


	(Unaudited)
(In thousands, except share data)	June 29, 2024		December 30, 2023

Assets

Current assets:
Cash and cash equivalents	$	825,655	$	1,170,893
Short-term investments	—		98,146
Accounts receivable, less allowance for doubtful accounts of $2,549 in 2024 and $2,830 in 2023	522,572		351,561
Inventories	406,217		380,248
Other current assets	50,347		39,173

Total current assets	1,804,791		2,040,021

Property, plant, and equipment, net	471,443		385,165
Operating lease right-of-use assets	34,534		35,170
Goodwill, net	608,919		151,820
Intangible assets, net	43,466		46,208
Investments in unconsolidated affiliates	77,450		83,436
Other assets	25,582		17,481

Total assets	$	3,066,185	$	2,759,301


MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

	(Unaudited)
(In thousands, except share data)	June 29, 2024		December 30, 2023

Liabilities

Current liabilities:
Current portion of debt	$	785	$	796
Accounts payable	198,537		120,485
Accrued wages and other employee costs	42,259		55,644
Current portion of operating lease liabilities	8,000		7,893
Other current liabilities	137,647		132,320

Total current liabilities	387,228		317,138

Long-term debt, less current portion	74		185
Pension liabilities	2,708		2,832
Postretirement benefits other than pensions	8,988		9,230
Environmental reserves	14,808		15,030
Deferred income taxes	20,023		19,134
Noncurrent operating lease liabilities	26,330		26,683
Other noncurrent liabilities	33,168		10,353

Total liabilities	493,327		400,585

Equity

Mueller Industries, Inc. stockholders' equity:
Preferred stock - $1.00 par value; shares authorized 5,000,000; none outstanding	—		—
Common stock - $.01 par value; shares authorized 250,000,000; issued 160,366,008; outstanding 113,403,336 in 2024 and 114,157,918 in 2023	1,604		1,604
Additional paid-in capital	325,763		312,171
Retained earnings	2,847,420		2,594,300
Accumulated other comprehensive loss	(60,162)		(47,221)
Treasury common stock, at cost	(568,522)		(523,409)

Total Mueller Industries, Inc. stockholders' equity	2,546,103		2,337,445
Noncontrolling interests	26,755		21,271

Total equity	2,572,858		2,358,716

Commitments and contingencies	—		—

Total liabilities and equity	$	3,066,185	$	2,759,301


	For the Quarter Ended June 29, 2024
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	688,469	$	195,341	$	130,532	$	(16,597)	$	997,745

Cost of goods sold	500,826		159,265		82,291		(17,392)		724,990
Depreciation and amortization	4,932		2,368		1,646		1,072		10,018
Selling, general, and administrative expense	20,453		4,015		7,602		20,661		52,731






Operating income	162,258		29,693		38,993		(20,938)		210,006

Interest expense									(107)
Interest income									14,383

Other expense, net									(1,356)

Income before income taxes									$	222,926


	For the Quarter Ended July 1, 2023
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	638,005	$	146,266	$	123,954	$	(11,241)	$	896,984

Cost of goods sold	452,866		123,097		77,064		(13,755)		639,272
Depreciation and amortization	5,252		1,804		2,202		1,158		10,416
Selling, general, and administrative expense	28,745		3,394		7,087		16,836		56,062



Gain on insurance settlement	—		—		(19,466)		—		(19,466)

Operating income	151,142		17,971		57,067		(15,480)		210,700

Interest expense									(135)
Interest income									7,732
Realized and unrealized gains on short-term investments									20,820
Other income, net									1,841

Income before income taxes									$	240,958


	For the Six Months Ended June 29, 2024
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	1,278,637	$	351,408	$	247,342	$	(29,988)	$	1,847,399

Cost of goods sold	921,767		285,869		157,882		(31,825)		1,333,693
Depreciation and amortization	9,492		4,288		3,241		2,166		19,187
Selling, general, and administrative expense	42,440		7,287		14,651		36,710		101,088






Operating income	304,938		53,964		71,568		(37,039)		393,431

Interest expense									(222)
Interest income									31,628
Realized and unrealized gains on short-term investments									365
Other expense, net									(726)

Income before income taxes									$	424,476


	For the Six Months Ended July 1, 2023
( In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	1,300,484	$	311,500	$	276,908	$	(20,716)	$	1,868,176

Cost of goods sold	920,476		256,267		165,876		(24,549)		1,318,070
Depreciation and amortization	10,810		3,576		4,355		2,332		21,073
Selling, general, and administrative expense	54,202		6,471		15,088		32,932		108,693



Gain on insurance settlement	—		—		(19,466)		—		(19,466)

Operating income	314,996		45,186		111,055		(31,431)		439,806

Interest expense									(278)
Interest income									13,967
Realized and unrealized gains on short-term investments									22,730
Other income, net									2,167

Income before income taxes									$	478,392


(In thousands)	June 29, 2024		December 30, 2023

Segment assets:
Piping Systems	$	1,112,550	$	1,029,821
Industrial Metals	821,011		157,761
Climate	275,872		252,561
General Corporate	856,752		1,319,158

	$	3,066,185	$	2,759,301


	For the Six Months Ended
(In thousands)	June 29, 2024		July 1, 2023

Cash flows from financing activities
Dividends paid to stockholders of Mueller Industries, Inc.	$	(44,488)	$	(33,402)

Repurchase of common stock	(42,994)		(19,303)


Repayments of debt	(111)		(130)
Issuance (repayment) of debt by consolidated joint ventures, net	11		(143)
Net cash used to settle stock-based awards	(2,002)		(2,588)


Net cash used in financing activities	$	(89,584)	$	(55,566)

Effect of exchange rate changes on cash	(4,784)		4,825

(Decrease) increase in cash, cash equivalents, and restricted cash	(332,208)		308,085
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	$	842,015	$	773,381


(In thousands)	June 29, 2024		December 30, 2023

Raw materials and supplies	$	115,258	$	111,843
Work-in-process	80,599		61,793
Finished goods	222,501		220,629
Valuation reserves	(12,141)		(14,017)

Inventories	$	406,217	$	380,248


	For the Six Months Ended July 1, 2023
(In thousands)	Cumulative Translation Adjustment		Unrealized Gain (Loss) on Derivatives		Pension/OPEB Liability Adjustment		Attributable to Unconsol. Affiliates		Total

Balance as of December 31, 2022	$	(69,238)	$	1,486	$	1,222	$	2,355	$	(64,175)

Other comprehensive income before reclassifications	18,012		1,006		148		1,638		20,804
Amounts reclassified from AOCI	—		(2,731)		(147)		—		(2,878)

Net current-period other comprehensive income (loss)	18,012		(1,725)		1		1,638		17,926


Balance as of July 1, 2023	$	(51,226)	$	(239)	$	1,223	$	3,993	$	(46,249)


	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
(In thousands)	Balance Sheet Location	June 29, 2024		December 30, 2023		Balance Sheet Location	June 29, 2024		December 30, 2023

Commodity contracts - gains	Other current assets	$	—	$	589	Other current liabilities	$	2,131	$	16
Commodity contracts - losses	Other current assets	—		(281)		Other current liabilities	(9,919)		(383)

Total derivatives (1)		$	—	$	308		$	(7,788)	$	(367)


	For the Quarter Ended June 29, 2024
(In thousands)	Gain (Loss) Recognized in AOCI (Effective Portion), Net of Tax		Classification Gains (Losses)	Gain Reclassified from AOCI (Effective Portion), Net of Tax

Cash flow hedges:
Commodity contracts	$	462	Cost of goods sold	$	(1,197)
Other	(11)		Other	—

Total	$	451	Total	$	(1,197)


	For the Quarter Ended July 1, 2023
(In thousands)	(Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax		Classification Gains (Losses)	Gain Reclassified from AOCI (Effective Portion), Net of Tax

Cash flow hedges:
Commodity contracts	$	(1,961)	Cost of goods sold	$	(742)
Other	24		Other	—

Total	$	(1,937)	Total	$	(742)


	For the Six Months Ended June 29, 2024
(In thousands)	Gain Recognized in AOCI (Effective Portion), Net of Tax		Classification Gains (Losses)	Gain Reclassified from AOCI (Effective Portion), Net of Tax

Cash flow hedges:
Commodity contracts	$	1,129	Cost of goods sold	$	(1,570)
Other	22		Other	—

Total	$	1,151	Total	$	(1,570)


	Amount reclassified from AOCI
	For the Quarter Ended				For the Six Months Ended
(In thousands)	June 29, 2024		July 1, 2023		June 29, 2024		July 1, 2023		Affected line item

Unrealized gains on derivative commodity contracts	$	(1,531)	$	(960)	$	(2,014)	$	(3,511)	Cost of goods sold

	334		218		444		780		Income tax expense

	$	(1,197)	$	(742)	$	(1,570)	$	(2,731)	Net of tax and noncontrolling interests

Amortization of net (gain) loss and prior service (credit) cost on employee benefit plans	$	(67)	$	(99)	$	(132)	$	(197)	Other (expense) income, net
	19		25		38		50		Income tax expense

	$	(48)	$	(74)	$	(94)	$	(147)	Net of tax and noncontrolling interests


	For the Quarter Ended				Percent Change		For the Six Months Ended				Percent Change
(In thousands)	June 29, 2024		July 1, 2023		2024 vs. 2023		June 29, 2024		July 1, 2023		2024 vs. 2023

Net sales	$	997,745	$	896,984	11.2	%	$	1,847,399	$	1,868,176	(1.1)	%
Operating income	210,006		210,700		(0.3)		393,431		439,806		(10.5)
Net income	160,165		177,711		(9.9)		298,528		350,950		(14.9)


	Quarter-to- Date		Year-to- Date
Net selling price in core product lines	5.6	%	0.7	%
Unit sales volume in core product lines	2.3		(1.0)
Acquisitions	3.4		1.6
Dispositions	(0.9)		(0.8)
Other	0.8		(1.6)

	11.2	%	(1.1)	%


(In thousands)	2024		2023

Increase (decrease) in:
Cash, cash equivalents, and restricted cash	$	(332,208)	$	308,085
Short-term investments	(98,146)		(90,812)
Property, plant, and equipment, net	86,278		6,978
Goodwill and intangible assets, net	454,357		(678)
Total debt	(122)		(92)
Working capital, net of cash and current debt	39,907		10,390

Net cash provided by operating activities	274,375		250,830
Net cash (used in) provided by investing activities	(512,215)		107,996
Net cash used in financing activities	(89,584)		(55,566)


	(a) Total Number of Shares Purchased (1)	(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs (2)


March 31, 2024 - April 27, 2024	544	$	58.27	—	24,433,808
April 28, 2024 - May 25, 2024	123,077	$	57.16	120,000	24,313,808
May 26, 2024 - June 29, 2024	146,839	$	56.25	144,000	24,169,808
Total	270,460			264,000


10.1			Equity Purchase Agreement by and among Unified Wire & Cable LLC, Conex Cable, LLC, Nehring Electrical Works Company, Express Wire and Cable Distributors, Inc., Wurlitzer Dietz Property LLC, Peace Road Properties, LLC and Locust Properties, LLC, the Sellers named therein, Mueller Industries, Inc., and Raymond Hott, as Representative of the Sellers, dated as of April 19, 2024 (Incorporated herein by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, dated April 23, 2024 ).

10.2			2024 Incentive Plan (Incorporated herein by reference to Annex 1 of the Registrant’s Definitive Proxy Statement, dated March 28, 2024).

31.1			Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.

31.2			Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.

32.1			Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2			Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.CAL			Inline XBRL Taxonomy Extension Calculation Linkbase

101.DEF			Inline XBRL Taxonomy Extension Definition Linkbase

101.INS			Inline XBRL Instance Document

101.LAB			Inline XBRL Taxonomy Extension Label Linkbase

101.PRE			Inline XBRL Presentation Linkbase Document

101.SCH			Inline XBRL Taxonomy Extension Schema

104			Cover Page Interactive Data File (embedded within the Inline XBRL document and included in exhibit 101)


			MUELLER INDUSTRIES, INC.


			/s/ Jeffrey A. Martin
			Jeffrey A. Martin
July 24, 2024			Chief Financial Officer and Treasurer
Date			(Principal Financial and Accounting Officer)


			/s/ Anthony J. Steinriede
July 24, 2024			Anthony J. Steinriede
Date			Vice President – Corporate Controller


1.	I have reviewed this quarterly report on Form 10-Q of Mueller Industries, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)), for the registrant and have:

	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	d)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

	b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: July 24, 2024
			/s/ Gregory L. Christopher
			Gregory L. Christopher
			Chief Executive Officer


(1)			The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)			The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



/s/ JEFFREY A. MARTIN
Jeffrey A. Martin
Chief Financial Officer
July 24, 2024