Industry Segments

6 Months Ended

Jun. 27, 2015

Industry Segments [Abstract]

Industry Segments

Note 4 – Industry Segments

The Company’s reportable segments are Plumbing & Refrigeration and Original Equipment Manufacturers (OEM).  For disclosure purposes, as permitted under Accounting Standards Codification (ASC) 280, Segment Reporting, certain operating segments are aggregated into reportable segments.  The Plumbing & Refrigeration segment is composed of Standard Products (SPD), European Operations, and Mexican Operations.  The OEM segment is composed of Industrial Products (IPD), Engineered Products (EPD), and Jiangsu Mueller–Xingrong Copper Industries Limited (Mueller-Xingrong).  These segments are classified primarily by the markets for their products.  Performance of segments is generally evaluated by their operating income.  

SPD manufactures copper tube and fittings, plastic fittings, and line sets.  These products are manufactured in the U.S.  SPD also imports and resells brass and plastic plumbing valves, malleable iron fittings, faucets, and plumbing specialty products.  Outside the U.S., the Company’s European Operations manufacture copper tube, which is sold primarily in Europe.  Mexican Operations consist of pipe nipple manufacturing and import distribution businesses including product lines of malleable iron fittings and other plumbing specialties.  The Plumbing & Refrigeration segment’s products are sold primarily to plumbing, refrigeration, and air-conditioning wholesalers, hardware wholesalers and co-ops, and building product retailers.  For the six months ended June 28, 2014, cost of goods sold included a decrease in accruals related to import duties of $3.1 million.

IPD manufactures brass rod, impact extrusions, and forgings, as well as a wide variety of end products including plumbing brass, automotive components, valves, and fittings.  EPD manufactures and fabricates valves and assemblies primarily for the refrigeration, air-conditioning, gas appliance, and barbecue grill markets and specialty copper, copper-alloy, and aluminum tube.  Mueller-Xingrong manufactures engineered copper tube primarily for air-conditioning applications.  These products are sold primarily to OEM customers.

Summarized segment information is as follows:

	For the Quarter Ended June 27, 2015
(In thousands)	Plumbing & Refrigeration Segment			OEM Segment		Corporate and Eliminations			Total
Net sales	$	327,336		$	230,380	$	(2,123	)	$	555,593
Cost of goods sold		278,237			194,207		(2,079	)		470,365
Depreciation and amortization		4,577			3,133		478			8,188
Selling, general, and administrative expense		20,473			6,239		6,708			33,420
Gain on sale of assets		(15,376	)		—		—			(15,376	)
Severance		3,442			—		—			3,442
Operating income		35,983			26,801		(7,230	)		55,554
Interest expense										(2,219	)
Other income, net										265
Income before income taxes									$	53,600

	For the Quarter Ended June 28, 2014
(In thousands)	Plumbing & Refrigeration Segment		OEM Segment		Corporate and Eliminations			Total
Net sales	$	397,190	$	255,409	$	(2,908	)	$	649,691
Cost of goods sold		336,256		224,392		(2,873	)		557,775
Depreciation and amortization		5,096		2,892		604			8,592
Selling, general, and administrative expense		21,755		4,909		6,703			33,367
Severance		1,753		—		—			1,753
Operating income		32,330		23,216		(7,342	)		48,204
Interest expense									(1,457	)
Other income, net									127
Income before income taxes								$	46,874

	For the Six Months Ended June 27, 2015
(In thousands)	Plumbing & Refrigeration Segment			OEM Segment		Corporate and Eliminations			Total
Net sales	$	632,353		$	465,697	$	(5,215	)	$	1,092,835
Cost of goods sold		538,700			397,640		(5,141	)		931,199
Depreciation and amortization		9,100			5,988		953			16,041
Selling, general, and administrative expense		41,013			12,720		12,518			66,251
Gain on sale of assets		(15,376	)		—		—			(15,376	)
Severance		3,442			—		—			3,442
Operating income		55,474			49,349		(13,545	)		91,278
Interest expense										(4,295	)
Other income, net										370
Income before income taxes									$	87,353

	For the Six Months Ended June 28, 2014
(In thousands)	Plumbing & Refrigeration Segment			OEM Segment		Corporate and Eliminations			Total
Net sales	$	735,217		$	495,439	$	(6,591	)	$	1,224,065
Cost of goods sold		625,281			434,795		(6,524	)		1,053,552
Depreciation and amortization		9,516			5,975		1,208			16,699
Selling, general, and administrative expense		43,410			10,167		12,931			66,508
Gain on sale of assets		(1,417	)		—		—			(1,417	)
Severance		2,212			—		—			2,212
Operating income		56,215			44,502		(14,206	)		86,511
Interest expense										(2,483	)
Other income, net										215
Income before income taxes									$	84,243