Segment Information

6 Months Ended

Jun. 25, 2022

Segment Reporting [Abstract]

Segment Information

Segment Information

Each of the Company’s reportable segments is composed of certain operating segments that are aggregated primarily by the nature of products offered as follows:

Piping Systems

Piping Systems is composed of the following operating segments: Domestic Piping Systems Group, Great Lakes Copper, Heatlink Group, European Operations, Trading Group, Jungwoo-Mueller (the Company’s South Korean joint venture), and Mueller Middle East (the Company’s Bahraini joint venture).  The Domestic Piping Systems Group manufactures and distributes copper tube, fittings, and line sets.  These products are manufactured in the U.S., sold in the U.S., and exported to markets worldwide.  Outside the U.S., Great Lakes Copper manufactures copper tube and line sets in Canada and sells the products primarily in the U.S. and Canada. Heatlink Group produces a complete line of products for PEX plumbing and radiant systems in Canada and sells these products in Canada and the U.S. European Operations manufactures copper tube in the U.K. which is sold primarily in Europe.  The Trading Group manufactures pipe nipples and resells brass and plastic plumbing valves, malleable iron fittings, faucets, and plumbing specialty products in the U.S. and Mexico.  Jungwoo-Mueller manufactures copper-based joining products that are sold worldwide.  Mueller Middle East manufactures copper tube and serves markets in the Middle East and Northern Africa. The Piping Systems segment’s products are sold primarily to plumbing, refrigeration, and air-conditioning wholesalers, hardware wholesalers and co-ops, building product retailers, and air-conditioning OEMs.

Beginning in fiscal year 2022, the results of Precision Tube are included in the Industrial Metals segment prospectively as the impact to prior periods was not material. The business was previously reported in the Piping Systems segment. This change was made to reflect the Company’s internal management reporting structure.

Industrial Metals

Industrial Metals is composed of the following operating segments: Brass Rod, Impacts & Micro Gauge, Brass Value-Added Products, and Precision Tube.  These businesses manufacture brass rod, impact extrusions, and forgings, specialty copper, copper alloy, and aluminum tube, as well as a wide variety of end products including plumbing brass, automotive components, valves, fittings, and gas assemblies.  These products are manufactured in the U.S. and sold primarily to OEMs in the U.S., many of which are in the industrial, transportation, construction, heating, ventilation, and air-conditioning, plumbing, refrigeration, and energy markets.

Climate

Climate is composed of the following operating segments: Refrigeration Products, Westermeyer, Turbotec, Flex Duct, and Linesets, Inc. These domestic businesses manufacture refrigeration valves and fittings, high pressure components, coaxial heat exchangers, insulated HVAC flexible duct systems, and line sets primarily for the heating, ventilation, air-conditioning, and refrigeration markets in the U.S.

Summarized segment information is as follows:

	For the Quarter Ended June 25, 2022
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total
Net sales	$	824,807	$	179,175	$	164,484	$	(18,424)	$	1,150,042
Cost of goods sold	585,090		150,940		103,110		(18,226)		820,914
Depreciation and amortization	5,930		1,846		2,348		1,178		11,302
Selling, general, and administrative expense	22,208		2,221		8,279		16,248		48,956
Operating income	211,579		24,168		50,747		(17,624)		268,870
Interest expense									(147)
Other income, net									2,203
Income before income taxes									$	270,926

	For the Quarter Ended June 26, 2021
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total
Net sales	$	711,616	$	180,040	$	131,708	$	(10,772)	$	1,012,592
Cost of goods sold	558,278		155,399		96,303		(10,268)		799,712
Depreciation and amortization	5,515		1,694		2,753		1,172		11,134
Selling, general, and administrative expense	23,315		2,448		7,280		10,889		43,932
Operating income	124,508		20,499		25,372		(12,565)		157,814
Interest expense									(1,866)
Redemption premium									(5,674)
Other income, net									683
Income before income taxes									$	150,957

Segment information (continued):

	For the Six Months Ended June 25, 2022
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total
Net sales	$	1,528,237	$	353,487	$	305,106	$	(26,786)	$	2,160,044
Cost of goods sold	1,099,277		296,650		197,067		(27,569)		1,565,425
Depreciation and amortization	11,330		3,790		4,700		2,323		22,143
Selling, general, and administrative expense	45,563		5,620		15,892		29,337		96,412
Gain on sale of assets	—		—		—		(5,507)		(5,507)
Operating income	372,067		47,427		87,447		(25,370)		481,571
Interest expense									(305)
Other income, net									2,983
Income before income taxes									$	484,249

	For the Six Months Ended June 26, 2021
(In thousands)	Piping Systems		Industrial Metals		Climate		Corporate and Eliminations		Total
Net sales	$	1,259,364	$	344,892	$	242,734	$	(16,250)	$	1,830,740
Cost of goods sold	1,008,632		296,290		180,385		(17,177)		1,468,130
Depreciation and amortization	11,725		3,437		5,382		2,345		22,889
Selling, general, and administrative expense	47,401		5,819		14,260		21,887		89,367
Operating income	191,606		39,346		42,707		(23,305)		250,354
Interest expense									(6,335)
Redemption premium									(5,674)
Other income, net									1,260
Income before income taxes									$	239,605

The following table presents total assets attributable to each segment:

(In thousands)	June 25, 2022		December 25, 2021
Segment assets:
Piping Systems	$	1,298,116	$	1,160,272
Industrial Metals	195,907		173,290
Climate	288,776		250,107
General Corporate	264,173		145,267
	$	2,046,972	$	1,728,936

The following tables represent a disaggregation of revenue from contracts with customers, along with the reportable segment for each category:

	For the Quarter Ended June 25, 2022
(In thousands)	Piping Systems		Industrial Metals		Climate		Total
Tube and fittings	$	674,579	$	—	$	—	$	674,579
Brass rod and forgings	—		142,788		—		142,788
OEM components, tube & assemblies	—		20,254		32,526		52,780
Valves and plumbing specialties	150,228		—		—		150,228
Flex duct and other HVAC components	—		—		131,958		131,958
Other	—		16,133		—		16,133
	824,807		179,175		164,484		1,168,466
Intersegment sales							(18,424)
Net sales							$	1,150,042

	For the Quarter Ended June 26, 2021
(In thousands)	Piping Systems		Industrial Metals		Climate		Total
Tube and fittings	$	567,092	$	—	$	—	$	567,092
Brass rod and forgings	—		142,974		—		142,974
OEM components, tube & assemblies	8,456		12,710		43,449		64,615
Valves and plumbing specialties	136,068		—		—		136,068
Flex duct and other HVAC components	—		—		88,259		88,259
Other	—		24,356		—		24,356
	711,616		180,040		131,708		1,023,364
Intersegment sales							(10,772)
Net sales							$	1,012,592

Disaggregation of revenue from contracts with customers (continued):

	For the Six Months Ended June 25, 2022
(In thousands)	Piping Systems		Industrial Metals		Climate		Total
Tube and fittings	$	1,246,089	$	—	$	—	$	1,246,089
Brass rod and forgings	—		279,321		—		279,321
OEM components, tube & assemblies	—		40,350		61,618		101,968
Valves and plumbing specialties	282,148		—		—		282,148
Flex duct and other HVAC components	—		—		243,488		243,488
Other	—		33,816		—		33,816
	1,528,237		353,487		305,106		2,186,830
Intersegment sales							(26,786)
Net sales							$	2,160,044

	For the Six Months Ended June 26, 2021
(In thousands)	Piping Systems		Industrial Metals		Climate		Total
Tube and fittings	$	993,231	$	—	$	—	$	993,231
Brass rod and forgings	—		274,236		—		274,236
OEM components, tube & assemblies	17,011		23,743		81,516		122,270
Valves and plumbing specialties	249,122		—		—		249,122
Flex duct and other HVAC components	—		—		161,218		161,218
Other	—		46,913		—		46,913
	1,259,364		344,892		242,734		1,846,990
Intersegment sales							(16,250)
Net sales							$	1,830,740