8-K

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): July 21, 2020

MUELLER INDUSTRIES INC.

(Exact name of registrant as specified in its charter)  

Delaware	1-6770	25-0790410
(State or other jurisdiction	(Commission File	(IRS Employer
of incorporation)	Number)	Identification No.)

150 Schilling Boulevard	Suite 100
Collierville	Tennessee	38017
(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))

Securities registered pursuant to Section 12(b) of the Act:

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

 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 July 21, 2020, the Registrant issued a press release announcing earnings for the quarter ended June 27, 2020. A copy of the press release announcing the second quarter 2020 earnings is attached as Exhibit 99.1.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press release, dated July 21, 2020 reporting second quarter 2020 earnings.

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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
July 21, 2020

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Exhibit Index

Exhibit No.	Description
99.1	Press release, dated July 21, 2020.

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EX-99.1

Mueller Industries, Inc. Reports Second Quarter 2020 Earnings

COLLIERVILLE, Tenn., July 21, 2020 -- Mueller Industries, Inc. (NYSE: MLI) announced second quarter operating income of $52.3 million, compared with $51.5 million for the prior year period.

Net income for the second quarter was $28.0 million, or 50 cents per diluted share, the same as reported for 2019. Net sales were $500.2 million, compared with $666.4 million in the second quarter of 2019.

Second Quarter Financial and Operating Highlights:

•On average, COMEX copper traded 13 percent lower during the quarter versus the same period of 2019.

•Approximately $29.0 million of the quarter-over-quarter decline in sales was due to lower copper prices, with the balance attributable to lower volumes, which stemmed in large part from the COVID-19 shutdowns.

•Mark-to-market recovery on open hedge positions improved earnings by $3.3 million.

•We recorded an $8.6 million loss on our investment in Tecumseh Products Company, compared to the $5.3 million loss recorded during the prior year period. Included in the $8.6 million loss was $1.7 million of pre-tax restructuring charges and $3.0 million in foreign currency losses. Our restructuring efforts will continue.

•The effective tax rate for the quarter was 26 percent, compared with 23 percent in the prior year period.

•During the quarter, we generated $114.7 million in cash from operations and repaid $145.0 million on our revolving credit facility.

•Cash on hand was $123.6 million at quarter-end, with only $35.0 million drawn on our revolving credit facility.

Regarding the state of the Company and outlook, Greg Christopher, Mueller CEO said:

“Our proactive response to the COVID-19 pandemic, combined with timely cost controls, was critical to our continued profitability, notwithstanding volume declines. We anticipate that our businesses will strengthen as global economies continue to reopen. Given our low cost platform, we believe we are well positioned to remain solidly profitable, even at reduced demand levels.”

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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 Collierville, Tennessee and comprises a network of operations in the United States, Canada, Mexico, Great Britain, South Korea, the Middle East, 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.

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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

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	For the Quarter Ended				For the Six Months Ended
(In thousands, except per share data)	June 27, 2020		June 29, 2019		June 27, 2020		June 29, 2019
Net sales	$	500,168	$	666,394	$	1,103,087	$	1,278,175
Cost of goods sold	403,159		563,948		911,874		1,075,341
Depreciation and amortization	11,097		10,478		22,136		21,033
Selling, general, and administrative expense	33,616		40,446		76,368		81,099
Asset impairments	—		—		3,035		—
Litigation settlement, net	—		—		(21,933)		—
Operating income	52,296		51,522		111,607		100,702
Interest expense	(4,973)		(7,033)		(10,352)		(13,987)
Other income, net	2,834		462		3,112		290
Income before income taxes	50,157		44,951		104,367		87,005
Income tax expense	(13,029)		(10,432)		(27,173)		(19,978)
Loss from unconsolidated affiliates, net of foreign tax	(8,641)		(5,843)		(14,756)		(21,212)
Consolidated net income	28,487		28,676		62,438		45,815
Net income attributable to noncontrolling interests	(531)		(690)		(2,067)		(2,106)
Net income attributable to Mueller Industries, Inc.	$	27,956	$	27,986	$	60,371	$	43,709
Weighted average shares for basic earnings per share	55,723		55,753		55,799		55,741
Effect of dilutive stock-based awards	471		561		527		543
Adjusted weighted average shares for diluted earnings per share	56,194		56,314		56,326		56,284
Basic earnings per share	$	0.50	$	0.50	$	1.08	$	0.78
Diluted earnings per share	$	0.50	$	0.50	$	1.07	$	0.78
Dividends per share	$	0.10	$	0.10	$	0.20	$	0.20
Summary Segment Data:
Net sales:
Piping Systems Segment	$	334,040	$	425,865	$	719,053	$	802,357
Industrial Metals Segment	88,619		147,719		219,821		298,594
Climate Segment	86,107		96,081		179,379		185,915
Elimination of intersegment sales	(8,598)		(3,271)		(15,166)		(8,691)
Net sales	$	500,168	$	666,394	$	1,103,087	$	1,278,175
Operating income:
Piping Systems Segment	$	41,074	$	35,896	$	77,750	$	64,145
Industrial Metals Segment	8,873		14,911		20,055		34,098
Climate Segment	12,353		13,035		25,367		25,421
Unallocated expenses	(10,004)		(12,320)		(11,565)		(22,962)
Operating income	$	52,296	$	51,522	$	111,607	$	100,702

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	(Unaudited)
(In thousands)	June 27, 2020		December 28, 2019
ASSETS
Cash and cash equivalents	$	123,610	$	97,944
Accounts receivable, net	273,710		269,943
Inventories	244,414		292,107
Other current assets	28,957		33,778
Total current assets	670,691		693,772
Property, plant, and equipment, net	362,785		363,128
Operating lease right-of-use assets	17,172		26,922
Other assets	272,742		287,118
	$	1,323,390	$	1,370,940
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of debt	$	6,543	$	7,530
Accounts payable	93,579		85,644
Current portion of operating lease liabilities	4,623		5,250
Other current liabilities	124,519		135,863
Total current liabilities	229,264		234,287
Long-term debt	323,114		378,724
Pension and postretirement liabilities	17,998		22,208
Environmental reserves	19,776		19,972
Deferred income taxes	19,635		21,094
Noncurrent operating lease liabilities	13,009		22,388
Other noncurrent liabilities	10,390		10,131
Total liabilities	633,186		708,804
Total Mueller Industries, Inc. stockholders’ equity	670,681		643,468
Noncontrolling interests	19,523		18,668
Total equity	690,204		662,136
	$	1,323,390	$	1,370,940

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Six Months Ended
(In thousands)	June 27, 2020		June 29, 2019
Cash flows from operating activities
Consolidated net income	$	62,438	$	45,815
Reconciliation of consolidated net income to net cash provided by operating activities:
Depreciation and amortization	22,296		21,192
Stock-based compensation expense	4,198		4,302
Provision for doubtful accounts receivable	1,850		(100)
Loss from unconsolidated affiliates	14,756		21,212
Gain on disposals of properties	(9)		(37)
Impairment charges	3,035		—
Deferred income tax expense (benefit)	764		(67)
Changes in assets and liabilities, net of effects of business acquired:
Receivables	(11,212)		(42,045)
Inventories	43,263		30,080
Other assets	3,967		(4,617)
Current liabilities	(277)		(9,735)
Other liabilities	(5,369)		(1,485)
Other, net	3,082		(532)
Net cash provided by operating activities	142,782		63,983
Cash flows from investing activities
Capital expenditures	(22,215)		(13,034)
Acquisition of business, net of cash acquired	(15,415)		3,465
Investments in unconsolidated affiliates	—		(10,500)
Proceeds from sales of properties	1		351
Net cash used in investing activities	(37,629)		(19,718)
Cash flows from financing activities
Dividends paid to stockholders of Mueller Industries, Inc.	(11,168)		(11,151)
Repurchase of common stock	(5,574)		(1,763)
Issuance of long-term debt	110,015		100,638
Repayments of long-term debt	(166,021)		(110,914)
Repayment of debt by consolidated joint ventures, net	(471)		(4,132)
Net cash received (used) to settle stock-based awards	696		(127)
Net cash used in financing activities	(72,523)		(27,449)
Effect of exchange rate changes on cash	(6,160)		118
Increase in cash, cash equivalents, and restricted cash	26,470		16,934
Cash, cash equivalents, and restricted cash at the beginning of the period	98,042		77,138
Cash, cash equivalents, and restricted cash at the end of the period	$	124,512	$	94,072

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