Delaware | 0001-32892 | 20-3547095 |
(State or Other Jurisdiction of Incorporation or Organization) | (Commission File Number) | (I.R.S. Employer Identification Number) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240-13e-4(c)) |
Dated: February 3, 2016 | MUELLER WATER PRODUCTS, INC. | ||
By: | /s/ Evan L. Hart | ||
Evan L. Hart | |||
Senior Vice President and Chief Financial Officer |
December 31, | September 30, | ||||||
2015 | 2015 | ||||||
(in millions, except share amounts) | |||||||
Assets: | |||||||
Cash and cash equivalents | $ | 104.5 | $ | 113.1 | |||
Receivables, net | 142.9 | 175.3 | |||||
Inventories | 229.3 | 219.1 | |||||
Deferred income taxes | — | 28.3 | |||||
Other current assets | 15.7 | 13.7 | |||||
Total current assets | 492.4 | 549.5 | |||||
Property, plant and equipment, net | 147.4 | 148.9 | |||||
Intangible assets | 501.8 | 507.3 | |||||
Other noncurrent assets | 24.8 | 24.1 | |||||
Total assets | $ | 1,166.4 | $ | 1,229.8 | |||
Liabilities and equity: | |||||||
Current portion of long-term debt | $ | 6.0 | $ | 6.1 | |||
Accounts payable | 67.1 | 98.7 | |||||
Other current liabilities | 59.0 | 63.2 | |||||
Total current liabilities | 132.1 | 168.0 | |||||
Long-term debt | 482.0 | 482.9 | |||||
Deferred income taxes | 115.8 | 145.3 | |||||
Other noncurrent liabilities | 70.0 | 65.8 | |||||
Total liabilities | 799.9 | 862.0 | |||||
Commitments and contingencies | |||||||
Common stock: 600,000,000 shares authorized; 161,140,215 and 160,497,841 shares outstanding at December 31, 2015 and September 30, 2015, respectively | 1.6 | 1.6 | |||||
Additional paid-in capital | 1,571.1 | 1,574.8 | |||||
Accumulated deficit | (1,136.6 | ) | (1,142.8 | ) | |||
Accumulated other comprehensive loss | (71.0 | ) | (67.3 | ) | |||
Total Company stockholders’ equity | 365.1 | 366.3 | |||||
Noncontrolling interest | 1.4 | 1.5 | |||||
Total equity | 366.5 | 367.8 | |||||
Total liabilities and equity | $ | 1,166.4 | $ | 1,229.8 |
Three months ended | |||||||
December 31, | |||||||
2015 | 2014 | ||||||
(in millions, except per share amounts) | |||||||
Net sales | $ | 242.7 | $ | 261.8 | |||
Cost of sales | 174.0 | 190.5 | |||||
Gross profit | 68.7 | 71.3 | |||||
Operating expenses: | |||||||
Selling, general and administrative | 53.0 | 55.0 | |||||
Restructuring | 0.8 | 8.2 | |||||
Total operating expenses | 53.8 | 63.2 | |||||
Operating income | 14.9 | 8.1 | |||||
Interest expense, net | 6.1 | 9.4 | |||||
Loss on early extinguishment of debt | — | 31.3 | |||||
Income (loss) before income taxes | 8.8 | (32.6 | ) | ||||
Income tax expense (benefit) | 2.6 | (12.4 | ) | ||||
Net income (loss) | $ | 6.2 | $ | (20.2 | ) | ||
Net income (loss) per share: | |||||||
Basic | $ | 0.04 | $ | (0.13 | ) | ||
Diluted | $ | 0.04 | $ | (0.13 | ) | ||
Weighted average shares outstanding: | |||||||
Basic | 160.8 | 160.1 | |||||
Diluted | 163.2 | 160.1 | |||||
Dividends declared per share | $ | 0.0200 | $ | 0.0175 |
Three months ended | |||||||
December 31, | |||||||
2015 | 2014 | ||||||
(in millions) | |||||||
Operating activities: | |||||||
Net income (loss) | $ | 6.2 | $ | (20.2 | ) | ||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||
Depreciation | 7.0 | 7.0 | |||||
Amortization | 6.0 | 7.3 | |||||
Stock-based compensation | 1.3 | 1.9 | |||||
Retirement plans | 1.2 | 0.1 | |||||
Deferred income taxes | — | (4.0 | ) | ||||
Loss on early extinguishment of debt | — | 31.3 | |||||
Other, net | 0.6 | 3.8 | |||||
Changes in assets and liabilities, net of acquisitions: | |||||||
Receivables | 32.3 | 41.3 | |||||
Inventories | (10.5 | ) | (21.6 | ) | |||
Other assets | (2.9 | ) | (0.7 | ) | |||
Liabilities | (38.7 | ) | (73.3 | ) | |||
Net cash provided by (used in) operating activities | 2.5 | (27.1 | ) | ||||
Investing activities: | |||||||
Capital expenditures | (6.3 | ) | (7.2 | ) | |||
Proceeds from sales of assets | — | 3.6 | |||||
Other | — | 0.3 | |||||
Net cash used in investing activities | (6.3 | ) | (3.3 | ) | |||
Financing activities: | |||||||
Dividends | (3.2 | ) | (2.8 | ) | |||
Employee taxes related to stock-based compensation | (2.9 | ) | (2.2 | ) | |||
Repayments of debt | (1.3 | ) | (570.2 | ) | |||
Issuance of debt | — | 497.5 | |||||
Excess tax benefit on stock-based compensation exercises | 0.7 | — | |||||
Issuance of common stock | 0.4 | 1.5 | |||||
Deferred financing costs | — | (7.9 | ) | ||||
Other | 2.2 | (0.2 | ) | ||||
Net cash used in financing activities | (4.1 | ) | (84.3 | ) | |||
Effect of currency exchange rate changes on cash | (0.7 | ) | (1.3 | ) | |||
Net change in cash and cash equivalents | (8.6 | ) | (116.0 | ) | |||
Cash and cash equivalents at beginning of period | 113.1 | 161.1 | |||||
Cash and cash equivalents at end of period | $ | 104.5 | $ | 45.1 |
Quarter ended December 31, 2015 | |||||||||||||||||||
Mueller Co. | Anvil | Mueller Technologies | Corporate | Total | |||||||||||||||
(in millions, except per share amounts) | |||||||||||||||||||
GAAP Results: | |||||||||||||||||||
Net sales | $ | 144.7 | $ | 79.6 | $ | 18.4 | $ | — | $ | 242.7 | |||||||||
Gross profit | $ | 44.0 | $ | 21.1 | $ | 3.6 | $ | — | $ | 68.7 | |||||||||
Selling, general and administrative expenses | 20.0 | 17.4 | 6.9 | 8.7 | 53.0 | ||||||||||||||
Restructuring expense | 0.2 | 0.1 | 0.5 | — | 0.8 | ||||||||||||||
Operating income (loss) | $ | 23.8 | $ | 3.6 | $ | (3.8 | ) | $ | (8.7 | ) | 14.9 | ||||||||
Interest expense, net | 6.1 | ||||||||||||||||||
Income tax expense | 2.6 | ||||||||||||||||||
Consolidated net income | |||||||||||||||||||
Loss attributable to noncontrolling interest | |||||||||||||||||||
Net income | $ | 6.2 | |||||||||||||||||
Net income per diluted share | $ | 0.04 | |||||||||||||||||
Capital expenditures | $ | 3.6 | $ | 1.6 | $ | 1.0 | $ | 0.1 | $ | 6.3 | |||||||||
Non-GAAP results: | |||||||||||||||||||
Adjusted operating income (loss) and EBITDA: | |||||||||||||||||||
Operating income (loss) | $ | 23.8 | $ | 3.6 | $ | (3.8 | ) | $ | (8.7 | ) | $ | 14.9 | |||||||
Restructuring expense | 0.2 | 0.1 | 0.5 | — | 0.8 | ||||||||||||||
Adjusted operating income (loss) | 24.0 | 3.7 | (3.3 | ) | (8.7 | ) | 15.7 | ||||||||||||
Depreciation and amortization | 8.4 | 3.4 | 1.1 | 0.1 | 13.0 | ||||||||||||||
Adjusted EBITDA | $ | 32.4 | $ | 7.1 | $ | (2.2 | ) | $ | (8.6 | ) | $ | 28.7 | |||||||
Adjusted operating margin | 16.6 | % | 4.6 | % | (17.9 | )% | 6.5 | % | |||||||||||
Adjusted EBITDA margin | 22.4 | % | 8.9 | % | (12.0 | )% | 11.8 | % | |||||||||||
Adjusted net income: | |||||||||||||||||||
Net income | $ | 6.2 | |||||||||||||||||
Restructuring expense, net of tax | 0.5 | ||||||||||||||||||
Adjusted net income | $ | 6.7 | |||||||||||||||||
Adjusted net income per diluted share | $ | 0.04 | |||||||||||||||||
Free cash flow: | |||||||||||||||||||
Net cash provided by operating activities | $ | 2.5 | |||||||||||||||||
Less capital expenditures | (6.3 | ) | |||||||||||||||||
Free cash flow | $ | (3.8 | ) | ||||||||||||||||
Net debt (end of period): | |||||||||||||||||||
Current portion of long-term debt | $ | 6.0 | |||||||||||||||||
Long-term debt | 482.0 | ||||||||||||||||||
Total debt | 488.0 | ||||||||||||||||||
Less cash and cash equivalents | (104.5 | ) | |||||||||||||||||
Net debt | $ | 383.5 | |||||||||||||||||
Adjusted EBITDA: | |||||||||||||||||||
Current quarter | $ | 28.7 | |||||||||||||||||
Three prior quarters | 158.4 | ||||||||||||||||||
Adjusted EBITDA | $ | 187.1 | |||||||||||||||||
Net debt leverage (net debt divided by adjusted EBITDA) | 2.0x |
Quarter ended December 31, 2014 | |||||||||||||||||||
Mueller Co. | Anvil | Mueller Technologies | Corporate | Total | |||||||||||||||
(in millions, except per share amounts) | |||||||||||||||||||
GAAP results: | |||||||||||||||||||
Net sales | $ | 145.1 | $ | 97.1 | $ | 19.6 | $ | — | $ | 261.8 | |||||||||
Gross profit | $ | 41.3 | $ | 26.1 | $ | 3.9 | $ | — | $ | 71.3 | |||||||||
Selling, general and administrative expenses | 20.8 | 18.9 | 6.8 | 8.5 | 55.0 | ||||||||||||||
Restructuring expense | 8.1 | — | — | 0.1 | 8.2 | ||||||||||||||
Operating income (loss) | $ | 12.4 | $ | 7.2 | $ | (2.9 | ) | $ | (8.6 | ) | 8.1 | ||||||||
Interest expense, net | 9.4 | ||||||||||||||||||
Loss on early extinguishment of debt | 31.3 | ||||||||||||||||||
Income tax benefit | (12.4 | ) | |||||||||||||||||
Net loss | $ | (20.2 | ) | ||||||||||||||||
Net loss per diluted share | $ | (0.13 | ) | ||||||||||||||||
Capital expenditures | $ | 3.4 | $ | 2.6 | $ | 1.2 | $ | — | $ | 7.2 | |||||||||
Non-GAAP results: | |||||||||||||||||||
Adjusted operating income (loss) and EBITDA: | |||||||||||||||||||
Operating income (loss) | $ | 12.4 | $ | 7.2 | $ | (2.9 | ) | $ | (8.6 | ) | $ | 8.1 | |||||||
Restructuring expense | 8.1 | — | — | 0.1 | 8.2 | ||||||||||||||
Adjusted operating income (loss) | 20.5 | 7.2 | (2.9 | ) | (8.5 | ) | 16.3 | ||||||||||||
Depreciation and amortization | 9.7 | 3.6 | 0.9 | 0.1 | 14.3 | ||||||||||||||
Adjusted EBITDA | $ | 30.2 | $ | 10.8 | $ | (2.0 | ) | $ | (8.4 | ) | $ | 30.6 | |||||||
Adjusted operating margin | 14.1 | % | 7.4 | % | (14.8 | )% | 6.2 | % | |||||||||||
Adjusted EBITDA margin | 20.8 | % | 11.1 | % | (10.2 | )% | 11.7 | % | |||||||||||
Adjusted net income: | |||||||||||||||||||
Net loss | $ | (20.2 | ) | ||||||||||||||||
Loss on early extinguishment of debt, net of tax | 19.6 | ||||||||||||||||||
Restructuring expense, net of tax | 5.1 | ||||||||||||||||||
Adjusted net income | $ | 4.5 | |||||||||||||||||
Adjusted net income per diluted share | $ | 0.03 | |||||||||||||||||
Free cash flow: | |||||||||||||||||||
Net cash used in operating activities | $ | (27.1 | ) | ||||||||||||||||
Less capital expenditures | (7.2 | ) | |||||||||||||||||
Free cash flow | $ | (34.3 | ) | ||||||||||||||||
Net debt (end of period): | |||||||||||||||||||
Current portion of long-term debt | $ | 6.1 | |||||||||||||||||
Long-term debt | 485.6 | ||||||||||||||||||
Total debt | 491.7 | ||||||||||||||||||
Less cash and cash equivalents | (45.1 | ) | |||||||||||||||||
Net debt | $ | 446.6 | |||||||||||||||||
Adjusted EBITDA: | |||||||||||||||||||
Current quarter | $ | 30.6 | |||||||||||||||||
Three prior quarters | 155.1 | ||||||||||||||||||
Adjusted EBITDA | $ | 185.7 | |||||||||||||||||
Net debt leverage (net debt divided by adjusted EBITDA) | 2.4x |
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