Industry Segments

9 Months Ended

Sep. 26, 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 nine months ended September 27, 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 September 26, 2015
(In thousands)	Plumbing & Refrigeration Segment		OEM Segment		Corporate and Eliminations			Total
Net sales	$	325,022	$	212,596	$	(2,434	)	$	535,184
Cost of goods sold		280,891		188,665		(2,389	)		467,167
Depreciation and amortization		4,468		3,839		442			8,749
Selling, general, and administrative expense		20,104		6,814		5,323			32,241
Operating income	$	19,559	$	13,278	$	(5,810	)		27,027
Interest expense									(1,682	)
Other income, net									164
Income before income taxes								$	25,509

	For the Quarter Ended September 27, 2014
(In thousands)	Plumbing & Refrigeration Segment				OEM Segment			Corporate and Eliminations				Total
Net sales		$	357,843			$	247,883		$	(2,906	)		$	602,820
Cost of goods sold			308,927				215,225			(2,874	)			521,278
Depreciation and amortization			5,287				3,148			517				8,952
Selling, general, and administrative expense			22,613				5,533			5,858				34,004
Severance			860				—			—				860
Operating income		$	20,156			$	23,977		$	(6,407	)			37,726
Interest expense														(1,430	)
Other income, net														225
Income before income taxes													$	36,521
	For the Nine Months Ended September 26, 2015
(In thousands)	Plumbing & Refrigeration Segment				OEM Segment			Corporate and Eliminations				Total
Net sales		$	957,375			$	678,293		$	(7,649	)		$	1,628,019
Cost of goods sold			819,591				586,305			(7,530	)			1,398,366
Depreciation and amortization			13,568				9,827			1,395				24,790
Selling, general, and administrative expense			61,117				19,534			17,841				98,492
Gain on sale of assets			(15,376	)			—			—				(15,376	)
Severance			3,442				—			—				3,442
Operating income		$	75,033			$	62,627		$	(19,355	)			118,305
Interest expense														(5,977	)
Other income, net														534
Income before income taxes													$	112,862

	For the Nine Months Ended September 27, 2014
(In thousands)	Plumbing & Refrigeration Segment			OEM Segment		Corporate and Eliminations			Total
Net sales	$	1,093,060		$	743,322	$	(9,497	)	$	1,826,885
Cost of goods sold		934,208			650,020		(9,398	)		1,574,830
Depreciation and amortization		14,803			9,123		1,725			25,651
Selling, general, and administrative expense		66,023			15,700		18,789			100,512
Gain on sale of assets		(1,417	)		—		—			(1,417	)
Severance		3,072			—		—			3,072
Operating income	$	76,371		$	68,479	$	(20,613	)		124,237
Interest expense										(3,913	)
Other income, net										440
Income before income taxes									$	120,764