Mueller Industries Inc 10-Q for FY2024 Q3

Mueller Industries Inc (MLI)

10-Q 2024-10-23 For: 2024-09-28

Added on April 09, 2026

About this 10-Q

Mueller Industries Inc filed this 10-Q on October 23, 2024, covering the quarter ended September 28, 2024 (FY2024 Q3).

Headline figures

Quarter ended September 28, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $997.83M; up 21.7% from $819.79M a year earlier
Net income: $168.7M; up 27.1% from net income of $132.71M a year earlier
Diluted EPS: $1.48; up 26.5% from $1.17 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 September 28, 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	28

	Item 3. – Quantitative and Qualitative Disclosures About Market Risk	39

	Item 4. – Controls and Procedures	41

Part II. Other Information

	Item 1. – Legal Proceedings	41

	Item 1A. – Risk Factors	41

	Item 2. – Unregistered Sales of Equity Securities and Use of Proceeds	42

	Item 5. – Other Information	42

	Item 6. – Exhibits	43

Signatures		44


	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


	For the Quarter Ended				For the Nine Months Ended
(In thousands)	September 28, 2024		September 30, 2023		September 28, 2024		September 30, 2023

Consolidated net income	$	171,783	$	135,709	$	476,939	$	490,353

Other comprehensive income (loss), net of tax:
Foreign currency translation	6,117		(9,078)		(5,909)		8,898
Net change with respect to derivative instruments and hedging activities, net of tax of $(425), $(93), $(304) and $410	1,460		324		1,041		(1,401)
Net change in pension and postretirement obligation adjustments, net of tax of $134, $(15), $155 and $(3)	(323)		—		(380)		1
Attributable to unconsolidated affiliates, net of tax of $(27), $(64), $433 and $(540)	90		222		(1,493)		1,860

Total other comprehensive income (loss), net	7,344		(8,532)		(6,741)		9,358

Consolidated comprehensive income	179,127		127,177		470,198		499,711
Comprehensive income attributable to noncontrolling interests	(3,499)		(3,280)		(8,983)		(6,938)

Comprehensive income attributable to Mueller Industries, Inc.	$	175,628	$	123,897	$	461,215	$	492,773


	(Unaudited)
(In thousands, except share data)	September 28, 2024		December 30, 2023

Assets

Current assets:
Cash and cash equivalents	$	965,116	$	1,170,893
Short-term investments	4,449		98,146
Accounts receivable, less allowance for doubtful accounts of $2,330 in 2024 and $2,830 in 2023	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
Goodwill, net	599,559		151,820
Intangible assets, net	46,112		46,208
Investments in unconsolidated affiliates	80,174		83,436
Other assets	26,273		17,481

Total assets	$	3,206,132	$	2,759,301


MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

	(Unaudited)
(In thousands, except share data)	September 28, 2024		December 30, 2023

Liabilities

Current liabilities:
Current portion of debt	$	927	$	796
Accounts payable	183,511		120,485
Accrued wages and other employee costs	48,216		55,644
Current portion of operating lease liabilities	7,681		7,893
Other current liabilities	153,658		132,320

Total current liabilities	393,993		317,138

Long-term debt, less current portion	19		185
Pension liabilities	3,270		2,832
Postretirement benefits other than pensions	8,812		9,230
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

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 113,734,299 in 2024 and 114,157,918 in 2023	1,604		1,604
Additional paid-in capital	323,568		312,171
Retained earnings	2,992,922		2,594,300
Accumulated other comprehensive loss	(53,233)		(47,221)
Treasury common stock, at cost	(586,479)		(523,409)

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

Commitments and contingencies	—		—

Total liabilities and equity	$	3,206,132	$	2,759,301


	For the Quarter Ended				For the	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	$	910,348		$	2,979,692	$	2,991,673
Net income	168,699		141,464			475,224		512,909

Basic earnings per share	$	1.51	$	1.27		$	4.27	$	4.61
Diluted earnings per share	1.48		1.24			4.17		4.52


	For the Quarter Ended September 28, 2024
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	653,884	$	238,014	$	128,482	$	(22,549)	$	997,831

Cost of goods sold	459,818		204,406		81,579		(23,334)		722,469
Depreciation and amortization	5,082		3,976		1,650		1,002		11,710
Selling, general, and administrative expense	25,383		5,435		7,152		21,649		59,619
Gain on sale of assets	—		—		(2,667)		—		(2,667)





Operating income	163,601		24,197		40,768		(21,866)		206,700

Interest expense									(113)
Interest income									11,145
Realized and unrealized gains on short-term investments									164
Other expense, net									(122)

Income before income taxes									$	217,774


	For the Quarter Ended September 30, 2023
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	568,151	$	141,012	$	119,949	$	(9,320)	$	819,792

Cost of goods sold	394,736		119,108		76,133		(10,919)		579,058
Depreciation and amortization	5,025		1,835		1,618		1,153		9,631
Selling, general, and administrative expense	21,847		3,848		7,352		15,248		48,295

Gain on sale of business	—		—		—		(4,137)		(4,137)
Asset impairments	5,934		—		—		—		5,934



Operating income	140,609		16,221		34,846		(10,665)		181,011

Interest expense									(230)
Interest income									10,599
Realized and unrealized losses on short-term investments									(2,368)
Other expense, net									(47)

Income before income taxes									$	188,965


	For the Nine Months Ended September 28, 2024
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	1,932,521	$	589,422	$	375,824	$	(52,537)	$	2,845,230

Cost of goods sold	1,381,585		490,275		239,461		(55,159)		2,056,162
Depreciation and amortization	14,574		8,264		4,891		3,168		30,897
Selling, general, and administrative expense	67,542		12,722		21,803		59,926		161,993
Loss (gain) on sale of assets	281		—		(2,667)		(1,567)		(3,953)





Operating income	468,539		78,161		112,336		(58,905)		600,131

Interest expense									(335)
Interest income									42,773
Realized and unrealized gains on short-term investments									529
Other expense, net									(848)

Income before income taxes									$	642,250


	For the Nine Months Ended September 30, 2023
( In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total

Net sales	$	1,868,635	$	452,512	$	396,857	$	(30,036)	$	2,687,968

Cost of goods sold	1,315,212		375,375		242,009		(35,468)		1,897,128
Depreciation and amortization	15,835		5,411		5,973		3,485		30,704
Selling, general, and administrative expense	76,049		10,319		22,440		48,180		156,988

Gain on sale of business	—		—		—		(4,137)		(4,137)
Asset impairments	5,934		—		—		—		5,934

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

Operating income	455,605		61,407		145,901		(42,096)		620,817

Interest expense									(508)
Interest income									24,566
Realized and unrealized gains on short-term investments									20,362
Other income, net									2,120

Income before income taxes									$	667,357


	For the Nine Months Ended
(In thousands)	September 28, 2024		September 30, 2023

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 assets	9,026		214
Dividends from unconsolidated affiliates	—		1,093

Net cash (used in) provided by investing activities	$	(571,250)	$	94,117

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


(In thousands)	September 28, 2024		December 30, 2023

Raw materials and supplies	$	152,713	$	111,843
Work-in-process	51,994		61,793
Finished goods	208,106		220,629
Valuation reserves	(12,561)		(14,017)

Inventories	$	400,252	$	380,248


	For the Quarter Ended				For the Nine Months Ended
(In thousands)	September 28, 2024		September 30, 2023		September 28, 2024		September 30, 2023

Pension benefits:

Interest cost	$	581	$	594	$	1,744	$	1,783
Expected return on plan assets	(605)		(841)		(1,813)		(2,524)
Amortization of net loss	32		—		98		—

Net periodic benefit cost (income)	$	8	$	(247)	$	29	$	(741)

Other benefits:
Service cost	$	54	$	51	$	163	$	152
Interest cost	131		128		392		384
Amortization of prior service credit	(1)		(1)		(2)		(2)
Amortization of net gain	(98)		(98)		(295)		(294)


Net periodic benefit cost	$	86	$	80	$	258	$	240


	For the Nine Months Ended September 30, 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	8,654		1,147		221		1,860		11,882
Amounts reclassified from AOCI	—		(2,548)		(220)		—		(2,768)

Net current-period other comprehensive income (loss)	8,654		(1,401)		1		1,860		9,114


Balance as of September 30, 2023	$	(60,584)	$	85	$	1,223	$	4,215	$	(55,061)


(In thousands)	September 28, 2024		December 30, 2023

Segment assets:
Piping Systems	$	1,139,615	$	1,029,821
Industrial Metals	811,792		157,761
Climate	268,534		252,561
General Corporate	986,191		1,319,158

	$	3,206,132	$	2,759,301


	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
(In thousands)	Balance Sheet Location	September 28, 2024		December 30, 2023		Balance Sheet Location	September 28, 2024		December 30, 2023

Commodity contracts - gains	Other current assets	$	1,431	$	589	Other current liabilities	$	—	$	16
Commodity contracts - losses	Other current assets	—		(281)		Other current liabilities	(128)		(383)

Total derivatives (1)		$	1,431	$	308		$	(128)	$	(367)


	For the Quarter Ended September 28, 2024
(In thousands)	Gain Recognized in AOCI (Effective Portion), Net of Tax		Classification Gains (Losses)	Loss Reclassified from AOCI (Effective Portion), Net of Tax

Cash flow hedges:
Commodity contracts	$	929	Cost of goods sold	$	531
Other	—		Other	—

Total	$	929	Total	$	531


	Amount reclassified from AOCI
	For the Quarter Ended				For the Nine Months Ended
(In thousands)	September 28, 2024		September 30, 2023		September 28, 2024		September 30, 2023		Affected line item

Unrealized losses (gains) on derivative commodity contracts	$	685	$	236	$	(1,329)	$	(3,275)	Cost of goods sold

	(154)		(53)		290		727		Income tax (benefit) expense

	$	531	$	183	$	(1,039)	$	(2,548)	Net of tax and noncontrolling interests

Amortization of net (gain) loss and prior service (credit) cost on employee benefit plans	$	(67)	$	(99)	$	(199)	$	(296)	Other (expense) income, net
	20		26		58		76		Income tax expense

	$	(47)	$	(73)	$	(141)	$	(220)	Net of tax and noncontrolling interests


	For the Quarter Ended				Percent Change		For the Nine Months Ended				Percent Change
(In thousands)	September 28, 2024		September 30, 2023		2024 vs. 2023		September 28, 2024		September 30, 2023		2024 vs. 2023

Net sales	$	997,831	$	819,792	21.7	%	$	2,845,230	$	2,687,968	5.9	%
Operating income	206,700		181,011		14.2		600,131		620,817		(3.3)
Net income	168,699		132,709		27.1		467,227		483,659		(3.4)


	Quarter-to- Date		Year-to- Date
Net selling price in core product lines	6.5	%	2.5	%
Unit sales volume in core product lines	0.5		(0.6)
Acquisitions	12.5		4.9
Dispositions	—		(0.6)
Other	2.2		(0.3)

	21.7	%	5.9	%


(In thousands)	2024		2023

Increase (decrease) in:
Cash, cash equivalents, and restricted cash	$	(208,618)	$	515,920
Short-term investments	(93,697)		(93,183)
Property, plant, and equipment, net	121,069		(3,272)
Goodwill and intangible assets, net	447,643		(14,654)
Total debt	(35)		(172)
Working capital, net of cash and current debt	4,610		(91,120)

Net cash provided by operating activities	505,787		498,490
Net cash (used in) provided by investing activities	(571,250)		94,117
Net cash used in financing activities	(138,446)		(78,999)


	(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)


June 30, 2024 - July 27, 2024	100,341	$	58.38	91,000	24,078,808
July 28, 2024 - August 24, 2024	306,359	$	69.40	3,775	24,075,033
August 25, 2024 - September 28, 2024	—	$	—	—	24,075,033
Total	406,700			94,775


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
October 23, 2024			Chief Financial Officer and Treasurer
Date			(Principal Financial and Accounting Officer)


			/s/ Anthony J. Steinriede
October 23, 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: October 23, 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
October 23, 2024