EX-99.1 2 dex991.htm SEPTEMBER 28, 2010 PRESENTATION SEPTEMBER 28, 2010 PRESENTATION
D.A.
Davidson
9
th
Annual Engineering &
Construction
Conference
September 28, 2010
Exhibit 99.1

2
Safe
Harbor
Statement
This
presentation
contains
certain
statements
that
may
be
deemed
“forward-looking
statements”
within
the
meaning
of
the
Private
Securities
Litigation
Reform
Act
of
1995.
All
statements
that
address
activities,
events
or
developments
that
the
Company
intends,
expects,
plans,
projects,
believes
or
anticipates
will
or
may
occur
in
the
future
are
forward-looking
statements.
Examples
of
forward-looking
statements
include,
but
are
not
limited
to,
statements
the
Company
makes
regarding
general
economic
conditions,
spending
by
municipalities,
the
outlook
for
the
residential
and
non-residential
construction
markets,
improvements
related
to
capacity
utilization,
the
recovery,
if
any,
of
our
end
markets,
and
the
potential
effect
of
the
refinancing
on
the
Company’s
operations,
and
the
impact
of
these
factors
on
our
businesses.
Forward-looking
statements
are
based
on
certain
assumptions
and
assessments
made
by
the
Company
in
light
of
its
experience
and
perception
of
historical
trends,
current
conditions
and
expected
future
developments.
Actual
results
and
the
timing
of
events
may
differ
materially
from
those
contemplated
by
the
forward-looking
statements
due
to
a
number
of
factors,
including
regional,
national
or
global
political,
economic,
business,
competitive,
market
and
regulatory
conditions
and the following:
•
the demand level of manufacturing and construction activity;
•
the Company’s ability to service its debt obligations; and
•
the
other
factors
that
are
described
in
the
section
entitled
“RISK
FACTORS”
in
Item
1A
of our most recently filed Annual Report on Form 10-K.
Undue reliance should not be placed on any forward-looking statements. The Company does not
have any intention or obligation to update forward-looking statements, except as required by
law.
Safe Harbor Statement

3
Non-GAAP
Financial
Measures
The
Company
presents
adjusted
income
(loss)
from
operations,
adjusted
EBITDA,
adjusted
net
loss,
adjusted
net
loss
per
share,
free
cash
flow
and
net
debt
as
non-GAAP
measures.
Adjusted
income
(loss)
from
operations
represents
income
(loss)
from
operations
excluding
impairment
and
restructuring.
Adjusted
EBITDA
represents
income
(loss)
from
operations
excluding
impairment,
restructuring,
depreciation
and
amortization.
The
Company
presents
adjusted
EBITDA
because
it
is
a
measure
of
performance
management
believes
is
frequently
used
by
securities
analysts,
investors
and
interested
parties
in
the
evaluation
of
financial
performance. 
Adjusted
net
loss
and
adjusted
net
loss
per
share
exclude
impairment,
restructuring,
loss
on
early
extinguishment
of
debt,
certain
costs
to
settle
interest
rate
swap
contracts,
the
tax
on
the
repatriation
of
earnings
from
Canada
and
the
income
tax
effects
of
the
other
previously
mentioned
items.
These
items
are
excluded
because
they
are
not
considered
indicative
of
recurring
operations.
Free
cash
flow
represents
cash
flows
from
operating
activities,
less
certain
expenditures
related
to
the
early
extinguishment
of
notes,
less
capital
expenditures,
and
is
presented as a measurement of cash flow because it is commonly used by the investment
community. Net debt represents total debt less cash and cash equivalents.  Net debt is commonly
used by the investment community as a measure of indebtedness.  Adjusted income (loss) from
operations, adjusted EBITDA, adjusted net loss, adjusted net loss per share, free cash flow and
net debt have limitations as analytical tools, and investors should not consider any of these non-
GAAP measures in isolation or as a substitute for analysis of the Company's results as reported
under accounting principles generally accepted in the United States ("GAAP").  
A reconciliation of non-GAAP to GAAP results is included as an attachment to this presentation
and
has
been
posted
online
at
www.muellerwaterproducts.com.
Non-GAAP Financial Measures

4
Leading North American provider of water
infrastructure and flow control products in
attractive and growing water industry
One of the largest installed bases in the U.S.
Investment Highlights
Strong brands
Leading specification positions in 99 of
100 largest U.S. metropolitan areas
Low-cost manufacturing processes

5
Our Business
•
$1.4B LTM net sales (as of June 30, 2010)
•
Portfolio includes:
•
Fire hydrants
•
Valves
•
Pipe fittings
•
Ductile iron pipe
•
Water meters
•
Specified in 99 of the largest 100 U.S. metropolitan
areas
•
Approximately 75% of FY2009 net sales from
products with #1 or #2 position
(1)
Based
on
management
estimates
*
New
water
distribution
systems
driven
primarily
by
community
development
The largest publicly traded water infrastructure company in the United States
FY2009 Primary End Markets
(1)

6
Broad Product Portfolio
$607
$80
$50
$130
SEGMENT NET SALES
PRODUCT
PORTFOLIO
ADJUSTED OPERATING
INCOME (LOSS)
(1)
$388
($49)
$19
($31)
$370
$18
$16
$34
Iron Gate
Valves
Butterfly, Ball
and Plug Valves
Fittings &
Couplings
Cast Iron
Fittings
Hangers &
Supports
Gas Products /
Tapping
Machines
Pipe Nipples
Hydrants
DEPRECIATION AND
AMORTIZATION
(2)
Est. 1857
Est. 1899
Est. 1999 (1850)
HISTORICAL ROOTS
ADJUSTED EBITDA
(1) (2)
Note:
All
statistics
are
actuals
for
LTM
ended
June
30,
2010
(1)
Segment
operating
income
excludes
corporate
expenses
of
$33mm.
Mueller
Co.
excludes
$1mm
of
restructuring.
U.S.
Pipe
excludes
$12mm
of
restructuring.
Anvil
excludes
$1mm
of
restructuring.
(2)
Segment
depreciation
and
amortization
excludes
corporate
depreciation
of
$1mm.
($ in millions)
Restrained Joint
Pipe
Ductile Iron
Pipe
Joint Restraint          Joint Fitting

7
Complete Water Transmission Solutions
As water flows from
its source to
treatment facilities
to homes and
businesses across
North America, it
flows through or is
controlled by the
type of products we
manufacture, making
Mueller Water
Products an integral
part of the water
infrastructure
system.

8
* Company estimates based on internal analysis and information from trade associations and our distributor networks, where available.

9
Strategy And Objectives
•
Maintain leadership positions with customers and end users
•
Continue to enhance operational and organizational excellence
•
Broaden breadth and depth of products and services
•
Expand internationally
Capitalize on the large, attractive and growing water
infrastructure markets worldwide

Our End Markets

11
Primary End Markets
Non-Residential
Construction
$430mm
30%
Repair
and Replacement
(Public)
$850mm
85%
Residential
Construction*
(Private)
$150mm
15%
FY2009 Net Sales: $1.4B
Water Infrastructure
$1B
70%
Source: Management estimates
*
Residential is driven primarily by community development

12
The Market Opportunity Is Significant And Growing
Repair and Replacement Market
•
Aging water pipes need to be rehabilitated / replaced
•
Valves and hydrants typically replaced at same time as
pipes
•
15%
-
30%
of
treated
potable
water
lost
in
leaky
pipes
(2)
Funding and Spending
•
90% funded at local level
(3)
•
29%
of
water
systems
charge
less
than
cost
(4)
Water Rates
•
Average annual rate increase between 1996 and 2006 of
4.1%
(5)
•
Average
water
rates
increased
14%
from
2008
to
2009
(6)
Source:
(1) EPA 2007 Drinking Water Needs Survey and Assessment
(2) Global Water Intelligence Water Technology Markets 2010
(3) EPA Clean Water and Drinking Water Infrastructure Gap Analysis
(4) Government Accountability Office 2004 report on water infrastructure
(5) American Water Works Association 2006 Water and Wastewater Rate Survey
(6) Global Water Intelligence
20-YR Need for Water Infrastructure = $335bn
$198
$335
$0
$100
$200
$300
$400
$500
As of January 1999
As of January 2007
Comparison of 20-Year U.S. Need for Water Infrastructure
Investments ($ in billions)
(1)
Future Drinking Water Infrastructure Expenditure Needs
($ in billions)
(1)

13
Aging Water Infrastructure
•
An average of 700 water mains break daily
in
U.S.
(about
one
every
two
minutes)
(1)
•
Los Angeles typically has up to five breaks
daily;
225
major
breaks
each
year
(2)
•
Baltimore water main break in March 2010
left
100,000
people
without
water
(3)
(1)
Saving
U.S.
Water
and
sewer
systems
would
be
costly
,
The
New
York
Times,
March
15,
2010
(2)
More
water
main
breaks
become
business
as
usual,
Daily
News,
October
20,
2009
(3)
Thousands
in
Baltimore
County
still
without
water,
The
Baltimore
Sun,
March
8,
2010
June 2010 sinkhole 20’
x 8’
and 10’
to 15’
deep caused
by leak in 6”
pipe installed “probably in 1920s.”
Atlanta Journal-Constitution

14
Aging Water Infrastructure
“Crumbling infrastructure
has a direct impact on our
personal and economic
health, and the nation’s
infrastructure crisis is
endangering our future
prosperity.”
D. Wayne Klotz, P.E., F.ASCE
President
American Society of Civil Engineers

15
Aging
Water Infrastructure
Average life of 100 year old and 75 year old pipe is converging,
contributing to accelerating need for pipe replacement.
(1)
The
EPA
Clean
Water
and
Drinking
Water
Infrastructure
Gap
Analysis
2002

16
Increasing Federal Awareness of Funding Needs
•
At least 30 cities under consent decrees
—
Atlanta $4.0B
—
Washington, D.C. $2.8B
—
Baltimore City and county $1.7B
—
Cincinnati $1.5B
•
1974/1996 Safe Drinking Water Act
•
1998 Disinfectants and Disinfection Byproducts
Rule
•
2011 proposed federal budget
—
Currently calls for $1.3B for drinking
water SRF
Stronger EPA regulations should lead to increased investment
In 2008, 40 percent of
the nation’s community
water systems violated
the Safe Drinking
Water Act at least
once, according to an
analysis of E.P.A. data.
The New York Times
(Sept. 2009)

17
Funding 2010 Water Infrastructure Repair
Sources:
(1)
Bureau
of
Labor
Statistics
(2)
AWWA
State
of
the
Industry
Report
2009
Other
23%
Bonds
3%
Loans
46%
Operational Savings
24%
Rate
Increases 2%
Grants
1%
Sources of Funding
Water Infrastructure
Repair
(2)
Historical Water Rates
Compared to Other
Utilities
(1)

18
Historical Housing Starts
Historical
Housing
Starts
(1991
-
August
2010)
Seasonally Adjusted Annualized
400
650
900
1,150
1,400
1,650
1,900
2,150
2,400
1991-2009
Average 1,515
Bottom of prior down
cycle (798,000)
April -
Lowest starts (477,000)
since Census Bureau began
keeping records in 1959
2010 Forecast = 600,000  
8.3% increase over 2009

19
Update on End Markets –
Residential Construction
Significant
Economic
Downturns
(1)
(1)
Seasonally
adjusted
and
annualized
data
from
U.S.
Census
Bureau.
Housing
starts
in
thousands.
Significant Downturns
Peak
Trough
Length of
% Decline
Length of Recovery
Trough + 12 Months
Month
Starts
Month
Starts
Downturn
From Peak
To 1.6MM Starts
Starts
Increase
Feb-1959
1,667
Dec-1960
1,063
22 months
(36.2%)
23 months
1,365
28.4%
Dec-1965
1,656
Oct-1966
843
10 months
(49.1%)
25 months
1,491
76.9%
Jan-1969
1,769
Jan-1970
1,085
12 months
(38.7%)
10 months
1,828
68.5%
Oct-1972
2,485
Feb-1975
904
28 months
(63.6%)
19 months
1,538
70.1%
Apr-1978
2,197
Nov-1981
837
44 months
(61.9%)
15 months
1,372
63.9%
Jan-1986
1,972
Jan-1991
798
61 months
(59.5%)
38 months
1,176
47.4%
Jan-2006
2,273
Apr-2009
477
39 months
(79.0%)
TBD
TBD
TBD
Average
2,003
858
31 months
(57.2%)
22 months
1,350
57.3%
Median
1,972
843
28 months
(57.3%)
21 months
1,372
62.8%

20
Non-Residential Construction
Average 3-Month Change in Non-Residential
Construction
Non-Residential Construction Actual / Forecast

Actions & Business
Results

22
Management Actions/Initiatives
Objectives
Cost Savings Actions
Reduce costs and improve
operating leverage
Six
plants
closed
between
FY2006-
current
Sold certain non-core assets of Anvil
Reduced headcount 25% from September 30, 2007 to June 30, 2010 from approximately
6,700
employees
to
approximately
5,000
Took actions to lower labor costs
LEAN Six Sigma and other manufacturing improvements (continuous
improvement)
Invested in new automated ductile iron pipe operation to lower
products costs
Manage working capital and
capital expenditures to
generate free cash flow
Capital spending decreased from FY2007/FY2008 levels
FY2009 capital spending of $39.7 million;FY2010 capital spending
projected to be $39 to $41 million
Reduced inventory by $117 million in FY2009; $67million reduction
3Q10 YTD
Reduced debt by $269 million from June 30, 2009 through June 30, 2010

23
$509
$536
$618
$664
$804
$756
$718
$547
$492
$465
$551
$598
$595
$537
$546
$411
$393
$387
$431
$485
$535
$556
$595
$470
$0
$200
$400
$600
$800
$1,000
2002
2003
2004
2005
2006
2007
2008
2009
2002
2003
2004
2005
2006
2007
2008
2009
2002
2003
2004
2005
2006
2007
2008
2009
$107
$114
$142
$168
$222
$179
$153
$75
$4
$24
$33
$34
$2
$8
$14
$27
$45
$51
$59
$76
$45
$20
13.7%
0.7%
4.0%
5.5%
0.4%
2.0%
3.6%
6.3%
9.3%
9.5%
10.6%
12.8%
9.5%
21.3%
21.3%
23.7%
27.6%
21.0%
25.3%
23.0%
4.1%
6.3%
(1.9%)
(9.7%)
($50)
$0
$50
$100
$150
$200
$250
$300
2002
2003
2004
2005
2006
2007
2008
2009
2002
2003
2004
2005
2006
2007
2008
2009
2002
2003
2004
2005
2006
2007
2008
2009
(12.0%)
(5.0%)
2.0%
9.0%
16.0%
23.0%
30.0%
($9)
($40)
NET SALES
OPERATING
INCOME
&
OPERATING
MARGIN
($ in millions)
History Of Strong Financial Performance

24
Consolidated Non-GAAP Results
•
Began to see the benefits of January valve and hydrant price increases
•
Average prices on pipe shipments at U.S. Pipe were down YOY but up sequentially. Order price up sequentially.
•
Significant improvement in operating margins on increased volumes, manufacturing and other cost savings, and
increased capacity utilization primarily at Mueller Co. and U.S.
Pipe
•
Continue to see signs of stabilization in most of Anvil’s end markets
•
We
believe
our
distributors
and
our
end
customers
are
approaching
the
4
th
quarter
with
caution
given
uncertain
economic climate
FY
3Q10
results
exclude
restructuring
$0.9
million,
$0.5
million
net
of
tax,
and
$2.2
million
tax
expense
on
the
repatriation
of
Canadian
earnings
FY
3Q09
results
exclude
restructuring
$3.9
million,
$2.4
million
net
of
tax,
and
$2.3
million,
$1.4
million
net
of
tax,
on
loss
on
early
extinguishment
of
debt
$ in millions (except per share amounts)
2010
2009
Net sales
$375.9
$363.2
Adj. income (loss) from operations
$13.4
($4.6)
Adj. operating income (loss) % of net sales
3.6%
(1.3%)
Adj. net loss per share
($0.01)
($0.13)
Adj. EBITDA
$34.5
$17.0
Adj. EBITDA % of net sales
9.2%
4.7%
Third Quarter Fiscal

25
Refinancing Highlights
•
Recapitalization provides a long-term capital
structure
•
Extends maturities with no required principal
payments before 2015
•
Locks in long term capital at attractive rates
•
Preserves deleveraging capability
•
Expect greater operational flexibility
•
Elimination of financial maintenance covenants
with excess availability of $34.4mm or 12.5% of
facility amount
•
Pro forma excess availability at June 30, 2010 of
$157mm, after $49mm initial borrowing and
$37.6mm letters of credit
•
Reduces limitation on business operations
including acquisitions, investments, restricted
payments and divestitures
New structure:
•
$420mm 7 3/
8
% Senior Subordinated Notes due
2017
•
$225mm 8 3/
4
% Senior Unsecured Notes due
2020
•
$275mm ABL Revolver Credit Facility due 2015
($49mm drawn at 8/26/10)
Debt Maturity
($ in millions)
$0
$0
$0
$0
$0
$0
$0
$0
$49
$225
$420
$226
$0
$50
$100
$150
$200
$250
$300
$350
$400
$450
FY2010
FY2011
FY2012
FY2013
FY2014
FY2015
FY2016
FY2017
FY2018
FY2019
FY2020

26
Capital Structure
Notes:
*
FY
2007
excludes
$48.1
million
of
cash
costs
related
to
debt
restructuring
activities.
Reduced debt by $856mm from
March 31, 2006 through June 30, 2010
Reduced debt by $269mm in the 12
months ended June 30, 2010
Free Cash Flow
($ in millions)
$37
$115
$94
$91
$14
$0
$20
$40
$60
$80
$100
$120
$140
FY2006
FY2007*
FY2008
FY2009
FYTD 6/30/2010
Total Debt
($ in millions)
$1,549
$1,127
$1,101
$1,096
$740
$693
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
Mar-2006
FY2006
FY2007*
FY2008
FY2009
Jun 2010

27
Investment Highlights
•
Water industry has fundamentally strong long-term dynamics
•
Driven by new and upgraded infrastructure
•
Limited number of suppliers to end markets
•
Strong competitive position
•
Leading brand positions with large installed base
•
Leading municipal specification positions
•
Comprehensive distribution network
•
Low-cost manufacturing operations
•
Operating leverage when volumes improve
•
Growth opportunities
•
Organic growth
•
Strategic acquisitions

Supplemental Data

29
Segment Results and Reconciliation of Non-GAAP to GAAP
Performance Measures
(in millions, except per share amounts)
Three months ended June 30, 2010
Mueller Co.
U.S. Pipe
Anvil
Corporate
Total
GAAP results:
Net sales
174.6
$      
120.2
$      
81.1
$        
-
$             
375.9
$      
Gross profit (loss)
52.1
$        
(2.7)
$         
21.1
$        
0.1
$          
70.6
$        
Selling, general and administrative expenses
23.3
7.7
16.6
9.6
57.2
Restructuring
-
0.9
-
-
0.9
Income (loss) from operations
28.8
$        
(11.3)
$       
4.5
$          
(9.5)
$         
12.5
Interest expense, net
15.8
Income tax expense
0.5
Net loss
(3.8)
$         
Net loss per diluted share
(0.02)
$       
Capital expenditures
2.7
$          
2.1
$          
2.0
$          
-
$             
6.8
$          
Non-GAAP results:
Adjusted income (loss) from operations and EBITDA:
Income (loss) from operations
28.8
$        
(11.3)
$       
4.5
$          
(9.5)
$         
12.5
$        
Restructuring
-
0.9
-
-
0.9
Adjusted income (loss) from operations
28.8
(10.4)
4.5
(9.5)
13.4
Depreciation and amortization
12.3
4.6
3.9
0.3
21.1
Adjusted EBITDA
41.1
$        
(5.8)
$         
8.4
$          
(9.2)
$         
34.5
$        
Adjusted net loss:
Net loss
(3.8)
$         
Tax on repatriation on Canadian earnings
2.2
Restructuring, net of tax
0.5
Adjusted net loss
(1.1)
$         
Adjusted net loss per diluted share
(0.01)
$       
Free cash flow:
Net cash used in operating activities
(8.6)
$         
Capital expenditures
(6.8)
Free cash flow
(15.4)
$       
Net debt (end of period):
Current portion of long-term debt
10.5
$        
Long-term debt
682.2
Total debt
692.7
Less cash and cash equivalents
(77.1)
Net debt
615.6
$      

30
Segment Results and Reconciliation of Non-GAAP to GAAP
Performance Measures
(in millions, except per share amounts)
Three months ended June 30, 2009
Mueller Co.
U.S. Pipe
Anvil
Corporate
Total
GAAP results:
Net sales
154.6
$      
96.7
$        
111.9
$      
-
$             
363.2
$      
Gross profit (loss)
35.8
$        
(6.0)
$         
28.1
$        
(0.1)
$         
57.8
$        
Selling, general and administrative expenses
22.2
10.8
21.4
8.0
62.4
Impairment and restructuring
0.7
1.5
1.7
-
3.9
Income (loss) from operations
12.9
$        
(18.3)
$       
5.0
$          
(8.1)
$         
(8.5)
Interest expense, net
17.2
Loss on early extinguishment of debt
2.3
Income tax benefit
(9.0)
Net loss
(19.0)
$       
Net loss per diluted share
(0.16)
$       
Capital expenditures
1.7
$          
1.6
$          
1.8
$          
-
$             
5.1
$          
Non-GAAP results:
Adjusted income (loss) from operations and EBITDA:
Income (loss) from operations
12.9
$        
(18.3)
$       
5.0
$          
(8.1)
$         
(8.5)
$         
Impairment and restructuring
0.7
1.5
1.7
-
3.9
Adjusted income (loss) from operations
13.6
(16.8)
6.7
(8.1)
(4.6)
Depreciation and amortization
12.7
4.3
4.4
0.2
21.6
Adjusted EBITDA
26.3
$        
(12.5)
$       
11.1
$        
(7.9)
$         
17.0
$        
Adjusted net loss:
Net loss
(19.0)
$       
Restructuring, net of tax
2.4
Loss on early extinguishment of debt, net of tax
1.4
Adjusted net loss
(15.2)
$       
Adjusted net loss per diluted share
(0.13)
$       
Free cash flow:
Net cash provided by operating activities
70.5
$        
Capital expenditures
(5.1)
Free cash flow
65.4
$        
Net debt (end of period):
Current portion of long-term debt
19.3
$        
Long-term debt
941.9
Total debt
961.2
Less cash and cash equivalents
(80.1)
Net debt
881.1
$      

31
Segment Results and Reconciliation of Non-GAAP to GAAP
Performance Measures
(in millions, except per share amounts)
Nine months ended June 30, 2010
Mueller Co.
U.S. Pipe
Anvil
Corporate
Total
GAAP results:
Net sales
449.1
$      
282.9
$      
258.8
$      
-
$             
990.8
$      
Gross profit (loss)
121.2
$      
(19.6)
$       
63.0
$        
0.1
$          
164.7
$      
Selling, general and administrative expenses
66.7
22.3
48.0
26.0
163.0
Restructuring
0.1
11.6
0.1
-
11.8
Income (loss) from operations
54.4
$        
(53.5)
$       
14.9
$        
(25.9)
$       
(10.1)
Interest expense, net
47.4
Loss on early extinguishment of debt
0.5
Income tax benefit
(19.8)
Net loss
(38.2)
$       
Net loss per diluted share
(0.25)
$       
Capital expenditures
9.8
$          
7.4
$          
4.1
$          
0.1
$          
21.4
$        
Non-GAAP results:
Adjusted income (loss) from operations and EBITDA:
Income (loss) from operations
54.4
$        
(53.5)
$       
14.9
$        
(25.9)
$       
(10.1)
$       
Restructuring
0.1
11.6
0.1
-
11.8
Adjusted income (loss) from operations
54.5
(41.9)
15.0
(25.9)
1.7
Depreciation and amortization
37.2
14.0
11.5
0.6
63.3
Adjusted EBITDA
91.7
$        
(27.9)
$       
26.5
$        
(25.3)
$       
65.0
$        
Adjusted net loss:
Net loss
(38.2)
$       
Restructuring, net of tax
7.1
Tax on repatriation on Canadian earnings
2.2
Interest rate settlement costs, net of tax
(0.7)
Loss on early extinguishment of debt, net of tax
0.3
Adjusted net loss
(29.3)
$       
Adjusted net loss per diluted share
(0.19)
$       
Free cash flow:
Net cash provided by operating activities
35.7
$        
Capital expenditures
(21.4)
Free cash flow
14.3
$        
Net debt (end of period):
Current portion of long-term debt
10.5
$        
Long-term debt
682.2
Total debt
692.7
Less cash and cash equivalents
(77.1)
Net debt
615.6
$      

32
Segment Results and Reconciliation of Non-GAAP to GAAP
Performance Measures
(in millions, except per share amounts)
Nine months ended June 30, 2009
Mueller Co.
U.S. Pipe
Anvil
Corporate
Total
GAAP results:
Net sales
389.0
$      
305.6
$      
358.5
$      
-
$             
1,053.1
$   
Gross profit (loss)
89.3
$        
(6.3)
$         
104.8
$      
(0.1)
$         
187.7
$      
Selling, general and administrative expenses
64.6
27.9
64.7
27.5
184.7
Impairment and restructuring
820.1
100.9
95.6
0.2
1,016.8
Loss from operations
(795.4)
$     
(135.1)
$     
(55.5)
$       
(27.8)
$       
(1,013.8)
Interest expense, net
51.1
Loss on early extinguishment of debt
0.8
Income tax benefit
(79.9)
Net loss
(985.8)
$     
Net loss per diluted share
(8.52)
$       
Capital expenditures
7.8
$          
7.1
$          
7.5
$          
0.3
$          
22.7
$        
Non-GAAP results:
Adjusted income (loss) from operations and EBITDA:
Loss from operations
(795.4)
$     
(135.1)
$     
(55.5)
$       
(27.8)
$       
(1,013.8)
$  
Impairment and restructuring
820.1
100.9
95.6
0.2
1,016.8
Adjusted income (loss) from operations
24.7
(34.2)
40.1
(27.6)
3.0
Depreciation and amortization
38.2
16.6
13.0
0.5
68.3
Adjusted EBITDA
62.9
$        
(17.6)
$       
53.1
$        
(27.1)
$       
71.3
$        
Adjusted net loss
Net loss
(985.8)
$     
Impairment and restructuring, net of tax
953.7
Loss on early extinguishment of debt, net of tax
0.5
Adjusted net loss
(31.6)
$       
Adjusted net loss per diluted share
(0.27)
$       
Free cash flow:
Net cash provided by operating activities
68.3
$        
Capital expenditures
(22.7)
Free cash flow
45.6
$        
Net debt (end of period):
Current portion of long-term debt
19.3
$        
Long-term debt
941.9
Total debt
961.2
Less cash and cash equivalents
(80.1)
Net debt
881.1
$      

33
Segment Results And Reconciliation Of Non-GAAP To GAAP
Performance Measures
(in millions, except per share amounts)
Year ended September 30, 2009
Mueller Co.
U.S. Pipe
Anvil
Corporate
Total
GAAP results:
Net sales
547.1
$      
410.9
$      
469.9
$      
-
$             
1,427.9
$   
Loss from operations
(770.6)
$     
(142.4)
$     
(53.4)
$       
(34.5)
$       
(1,000.9)
$  
Interest expense, net
78.3
Loss on early extinguishment of debt, net
3.8
Income tax benefit
(86.3)
Net loss
(996.7)
$     
Net loss per diluted share
(8.55)
$       
Capital expenditures
16.2
$        
11.2
$        
11.9
$        
0.4
$          
39.7
$        
Non-GAAP results:
Adjusted income (loss) from operations and EBITDA:
Loss from operations
(770.6)
$     
(142.4)
$     
(53.4)
$       
(34.5)
$       
(1,000.9)
$  
Impairment
818.7
59.5
92.7
-
970.9
Restructuring
2.0
41.6
4.0
0.2
47.8
Adjusted income (loss) from operations
50.1
(41.3)
43.3
(34.3)
17.8
Depreciation and amortization
50.9
21.1
17.6
0.6
90.2
Adjusted EBITDA
101.0
$      
(20.2)
$       
60.9
$        
(33.7)
$       
108.0
$      
Adjusted net loss:
Net loss
(996.7)
$     
Impairment, net of tax
925.9
Restructuring, net of tax
29.0
Interest rate settlement costs, net of tax
3.8
Loss on early extinguishment of debt, net of tax
2.3
Adjusted net loss
(35.7)
$       
Adjusted net loss per diluted share
(0.31)
$       
Free cash flow:
Net cash used in operating activities
121.9
$      
Capital expenditures
(39.7)
Free cash flow
82.2
$        
Net debt (end of period):
Current portion of long-term debt
11.7
$        
Long-term debt
728.5
Total debt
740.2
Less cash and cash equivalents
(61.5)
Net debt
678.7
$      

34
Segment Results And Reconciliation Of Non-GAAP To GAAP
Performance Measures
(in millions, except per share amounts)
Year ended September 30, 2008
Mueller Co.
U.S. Pipe
Anvil
Corporate
Total
GAAP results:
Net sales
718.1
$      
546.0
$      
595.2
$      
-
$             
1,859.3
$   
Income (loss) from operations
128.4
$      
(17.4)
$       
74.1
$        
(39.0)
$       
146.1
$      
Interest expense, net
72.4
Income tax expense
31.7
Net income
42.0
$        
Net income per diluted share
0.36
$        
Capital expenditures
17.9
$        
58.5
$        
11.5
$        
0.2
$          
88.1
$        
Non-GAAP results:
Adjusted income (loss) from operations and EBITDA:
Income (loss) from operations
128.4
$      
(17.4)
$       
74.1
$        
(39.0)
$       
146.1
$      
Restructuring charges
-
18.3
-
-
18.3
Adjusted income (loss) from operations
128.4
0.9
74.1
(39.0)
164.4
Depreciation and amortization
50.1
22.7
19.7
0.6
93.1
Adjusted EBITDA
178.5
$      
23.6
$        
93.8
$        
(38.4)
$       
257.5
$      
Adjusted net income:
Net income
42.0
$        
Restructuring charges, net of tax
11.1
Adjusted net income
53.1
$        
Adjusted net income per diluted share
0.46
$        
Free cash flow:
Net cash provided by operating activities
182.0
$      
Capital expenditures
(88.1)
Free cash flow
93.9
$        
Net debt (end of period):
Current portion of long-term debt
6.1
$          
Long-term debt
1,090.6
Total debt
1,096.7
Less cash and cash equivalents
(141.9)
Net debt
954.8
$      

Questions