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): February 5, 2019

   MUELLER INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

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

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))

 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 February 5, 2019, the Registrant issued a press release announcing earnings for the quarter and year ended December 29, 2018. A copy of the press release announcing the fourth quarter and fiscal 2018 earnings is attached as Exhibit 99.1.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press release, dated February 5, 2019 reporting fourth quarter and fiscal 2018 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
Date: February 5, 2019

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Exhibit Index

Exhibit No.	Description
99.1	Press release, dated February 5, 2019.

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EX-99

Mueller Industries, Inc. Reports Fourth Quarter and Fiscal 2018 Earnings

Collierville, Tenn., February 5, 2019 -- Mueller Industries, Inc. (NYSE: MLI) announced today operating income for the fourth quarter of $40.0 million, compared with $21.1 million in the same quarter of 2017. Net income for the quarter was $26.9 million, or 47 cents per diluted share, on net sales of $559.1 million, compared with net income of $5.7 million, or 10 cents per diluted share, on net sales of $523.5 million in the fourth quarter of 2017.

On a full year basis, the Company reported operating income of $173.0 million, compared with $150.8 million in fiscal year 2017. Net income for the year was $104.5 million, or $1.82 per diluted share, on net sales of $2.5 billion, compared with net income of $85.6 million, or $1.49 per diluted share, on net sales of $2.3 billion in 2017.

Financial and Operating Highlights:

• Net sales for the quarter rose due to higher sales volumes combined with sales from the recently acquired ATCO business, offset by lower selling prices principally due to lower copper prices. Copper prices were 11 percent lower for the fourth quarter of 2018, averaging $2.75 per pound versus $3.10 per pound in the prior year period.

• During the fourth quarter of 2018, we recognized an insurance recovery gain of $2.2 million related to the losses we incurred due to the 2017 fire at our Port Huron brass rod mill.

• During the fourth quarter of 2018, the Company repurchased 1.14 million shares of its common stock at a cost of approximately $27.0 million.

• The financial health of the Company remains strong. For the full year, the Company generated $167.9 million in cash from operations, ending the year with a current ratio of 3.0 to 1 and a return on equity of 19 percent compared to 16 percent in 2017.

Regarding the business, Greg Christopher, Mueller CEO, said, “Overall, our acquisitions are exceeding our expectations and we are beginning to see the benefits of the major capital investments we worked so hard to complete these past five years. Most notably our U.S. Copper Tube manufacturing platforms continue to improve and throughout the year, yielded positive results in throughput, quality, and cost reductions, which will continue to benefit us in the future.

In addition, we continue to utilize our strong cash generation to fund growth opportunities, reduce debt and, when appropriate, return capital to our shareholders.”

Looking forward, he added, “By almost any measure, 2018 was healthier than the prior year and we expect those improvements to continue. Our outlook for 2019 remains positive, and we see opportunities to capitalize and grow in these interesting times both here and abroad.”

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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.

*********************

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 Year Ended
(In thousands, except per share data)	December 29, 2018			December 30, 2017			December 29, 2018			December 30, 2017
Net sales	$	559,087		$	523,524		$	2,507,878		$	2,266,073
Cost of goods sold	473,954			456,617			2,150,400			1,940,617
Depreciation and amortization	10,474			8,728			39,555			33,944
Selling, general, and administrative expense	36,892			36,054			148,888			140,730
Gain on sale of assets	—			—			(253		)	(1,491		)
Impairment charges	—			1,055			—			1,466
Insurance recovery	(2,195		)	—			(3,681		)	—
Operating income	39,962			21,070			172,969			150,807
Interest expense	(6,471		)	(5,292		)	(25,199		)	(19,502		)
Environmental expense	(623		)	(6,221		)	(1,320		)	(7,284		)
Other income, net	1,713			1,332			3,967			2,951
Income before income taxes	34,581			10,889			150,417			126,972
Income tax expense	(7,773		)	(4,589		)	(30,952		)	(37,884		)
Income (loss) from unconsolidated affiliates, net of foreign tax	923			(331		)	(12,645		)	(2,077		)
Consolidated net income	27,731			5,969			106,820			87,011
Net income attributable to noncontrolling interests	(874		)	(249		)	(2,361		)	(1,413		)
Net income attributable to Mueller Industries, Inc.	$	26,857		$	5,720		$	104,459		$	85,598
Weighted average shares for basic earnings per share	56,555			57,026			56,782			56,925
Effect of dilutive stock-based awards	377			612			487			559
Adjusted weighted average shares for diluted earnings per share	56,932			57,638			57,269			57,484
Basic earnings per share	$	0.47		$	0.10		$	1.84		$	1.50
Diluted earnings per share	$	0.47		$	0.10		$	1.82		$	1.49
Dividends per share	$	0.10		$	0.10		$	0.40		$	8.40
Summary Segment Data:
Net sales:
Piping Systems Segment	$	350,961		$	359,253		$	1,645,633		$	1,564,950
Industrial Metals Segment	139,129			150,212			651,061			602,131
Climate Segment	72,215			28,045			229,069			131,448
Elimination of intersegment sales	(3,218		)	(13,986		)	(17,885		)	(32,456		)
Net sales	$	559,087		$	523,524		$	2,507,878		$	2,266,073
Operating income:
Piping Systems Segment	$	22,453		$	13,273		$	122,829		$	99,596
Industrial Metals Segment	21,770			14,930			75,607			74,364
Climate Segment	7,450			3,170			24,118			20,325
Unallocated expenses	(11,711		)	(10,303		)	(49,585		)	(43,478		)
Operating income	$	39,962		$	21,070		$	172,969		$	150,807

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)	December 29, 2018		December 30, 2017
ASSETS
Cash and cash equivalents	$	72,616	$	120,269
Accounts receivable, net	273,417		244,795
Inventories	329,795		327,901
Other current assets	26,790		46,150
Total current assets	702,618		739,115
Property, plant, and equipment, net	370,633		304,321
Other assets	296,298		276,737
	$	1,369,549	$	1,320,173
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current portion of debt	$	7,101	$	16,480
Accounts payable	103,754		102,503
Other current liabilities	121,946		123,269
Total current liabilities	232,801		242,252
Long-term debt	489,597		448,592
Pension and postretirement liabilities	29,055		28,713
Environmental reserves	20,009		23,699
Deferred income taxes	16,615		19,403
Other noncurrent liabilities	18,212		21,486
Total liabilities	806,289		784,145
Total Mueller Industries, Inc. stockholders’ equity	548,356		522,111
Noncontrolling interests	14,904		13,917
Total equity	563,260		536,028
	$	1,369,549	$	1,320,173

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Year Ended
(In thousands)	December 29, 2018			December 30, 2017
Cash flows from operating activities
Consolidated net income	$	106,820		$	87,011
Reconciliation of consolidated net income to net cash provided by operating activities:
Depreciation and amortization	39,873			34,247
Stock-based compensation expense	8,035			7,450
Loss from unconsolidated affiliates	12,645			2,077
Gain on sale of business	—			(1,491		)
Gain on disposals of assets	(253		)	(624		)
Insurance proceeds - noncapital related	2,306			500
Insurance recovery	(3,681		)	—
Impairment charges	—			1,466
Deferred income tax expense (benefit)	170			(3,160		)
Changes in assets and liabilities, net of effects of businesses acquired and sold:
Receivables	(11,342		)	(1,779		)
Inventories	27,512			(86,286		)
Other assets	14,353			(5,325		)
Current liabilities	(15,680		)	10,678
Other liabilities	(14,769		)	64
Other, net	1,903			(833		)
Net cash provided by operating activities	167,892			43,995
Cash flows from investing activities
Proceeds from sale of assets, net of cash transferred	18,703			31,564
Acquisition of businesses, net of cash acquired	(167,677		)	(18,396		)
Capital expenditures	(38,481		)	(46,131		)
Insurance proceeds - capital related	1,968			—
Investment in unconsolidated affiliates	(1,609		)	(3,317		)
Net cash used in investing activities	(187,096		)	(36,280		)
Cash flows from financing activities
Dividends paid to stockholders of Mueller Industries, Inc.	(22,705		)	(196,944		)
Dividends paid to noncontrolling interests	(592		)	(2,909		)
Issuance of long-term debt	204,233			71,475
Repayments of long-term debt	(172,002		)	(111,224		)
Repayment of debt by consolidated joint ventures, net	(2,915		)	(3,369		)
Repurchase of common stock	(33,562		)	—
Net cash used to settle stock-based awards	(726		)	(1,595		)
Net cash used in financing activities	(28,269		)	(244,566		)
Effect of exchange rate changes on cash	(1,952		)	2,945
Decrease in cash, cash equivalents, and restricted cash	(49,425		)	(233,906		)
Cash, cash equivalents, and restricted cash at the beginning of the year	126,563			360,469
Cash, cash equivalents, and restricted cash at the end of the year	$	77,138		$	126,563

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