Mueller Industries (MLI) 10-Q 2009 Q3 Quarterly report

Exhibit 19.1

TO OUR STOCKHOLDERS, CUSTOMERS, AND EMPLOYEES

For the three months ended September 26, 2009, Mueller’s net income was $18.7 million, or 50 cents per diluted share, on net sales of $419.9 million.  Year-to-date, the Company earned $22.2 million, or 59 cents per diluted share.  Net sales for the first nine months of 2009 were $1.11 billion.

Net sales of the Company’s core product lines including copper tube, fittings, brass rod and forgings were substantially affected by the lower market values of copper and brass, the Company’s principal raw materials, which are largely passed through to customers.  In the third quarter of 2009, the Comex average price of copper was 23 percent lower than in the third quarter of 2008.  In addition, unit volumes of most of the Company’s core product lines were well below year ago levels.

Our cost control initiatives have helped to mitigate the impact of weak demand in the residential and commercial construction sectors.  We expect challenging market conditions will continue into next year.

Our Plumbing & Refrigeration segment posted operating earnings of $16.0 million on net sales of $240.9 million compared with operating earnings of $25.4 million on net sales of $371.3 million in the third quarter of 2008.  Due to lower throughput volumes, we experienced higher per unit conversion costs.  Our OEM segment posted operating earnings of $16.5 million during the third quarter of 2009 on net sales of $181.6 million, which compared with operating earnings of $10.6 million on net sales of $299.5 million for the same period in 2008.

We continue to generate cash by intensively managing working capital and monitoring capital expenditures. Mueller ended the quarter with $353.9 million in cash, or $9.40 per share.  Our financial position remains strong.

Very Truly Yours,

/S/ Harvey L. Karp	/S/ Gregory L. Christopher
Harvey L. Karp	Gregory L. Christopher
Chairman of the Board	Chief Executive Officer

October 20, 2009

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	For the Quarter Ended						For the Nine Months Ended
	September 26, 2009			September 27, 2008			September 26, 2009			September 27, 2008
	(In thousands, except per share data)
Net sales	$	419,890		$	665,496		$	1,114,248		$	2,123,075
Cost of goods sold		354,039			588,469			954,775			1,861,475
Depreciation and amortization		10,441			11,529			31,276			33,517
Selling, general, and administrative expense		27,593			35,674			89,067			108,583
Operating income		27,817			29,824			39,130			119,500
Interest expense		(2,435	)		(5,050	)		(7,553	)		(15,755	)
Other (expense) income, net		(324	)		2,573			688			9,103
Income before income taxes		25,058			27,347			32,265			112,848
Income tax expense		(6,246	)		(8,422	)		(9,796	)		(37,992	)
Consolidated net income		18,812			18,925			22,469			74,856
Less: net income attributable to noncontrolling interest		(146	)		(254	)		(267	)		(1,816	)
Net income attributable to Mueller Industries, Inc.	$	18,666		$	18,671		$	22,202		$	73,040
Weighted average shares for basic earnings per share		37,474			37,136			37,253			37,117
Effect of dilutive stock options		72			176			89			238
Adjusted weighted average shares for diluted earnings per share		37,546			37,312			37,342			37,355
Basic earnings per share	$	0.50		$	0.50		$	0.60		$	1.97
Diluted earnings per share	$	0.50		$	0.50		$	0.59		$	1.96
Dividends per share	$	0.10		$	0.10		$	0.30		$	0.30

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MUELLER INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 26,		December 27,			September 26,		December 27,
	2009		2008			2009		2008
	(In thousands)					(In thousands)
ASSETS					LIABILITIES AND STOCKHOLDERS' EQUITY
Cash and cash equivalents	$	353,874	$	278,860	Current portion of long-term debt	$	12,372	$	24,184
Accounts receivable, net		225,316		219,035	Accounts payable		70,380		63,732
Inventories		178,372		210,609	Other current liabilities		96,346		113,668
Other current assets		30,327		46,322
Total current assets		787,889		754,826	Total current liabilities		179,098		201,584
					Long-term debt		158,226		158,726
					Pension and postretirement liabilities		39,180		38,452
					Environmental reserves		23,090		23,248
Property, plant, and equipment, net		258,278		276,927	Deferred income taxes		33,435		33,940
Other assets		151,429		151,160	Other noncurrent liabilities		1,401		1,698
					Total liabilities		434,430		457,648
					Stockholders' equity		737,799		700,683
					Noncontrolling interest		25,367		24,582
					Total equity		763,166		725,265
	$	1,197,596	$	1,182,913		$	1,197,596	$	1,182,913

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, market demand, pricing, and competitive and technological factors, among others, as set forth in the Company’s SEC filings.  These filings are available through our website at www.muellerindustries.com.

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