Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 20, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | MUELLER INDUSTRIES INC | |
Entity Central Index Key | 89,439 | |
Current Fiscal Year End Date | --12-29 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 57,564,680 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Apr. 01, 2017 | |||
Income Statement [Abstract] | ||||
Net sales | $ 640,060 | $ 577,920 | [1] | |
Cost of goods sold | 545,670 | 488,427 | [1] | |
Depreciation and amortization | 9,456 | 8,355 | [1] | |
Selling, general, and administrative expense | 34,057 | 35,574 | [1] | |
Asset impairment | 3,469 | 0 | [2] | |
Operating income | 47,408 | 45,564 | [1] | |
Interest expense | (5,909) | (2,531) | [1] | |
Other income, net | 560 | 594 | [1] | |
Income before income taxes | 42,059 | 43,627 | [1] | |
Income tax expense | (7,395) | (11,929) | [1] | |
Loss from unconsolidated affiliates, net of foreign tax | (10,320) | (1,243) | [1],[2] | |
Consolidated net income | [1] | 24,344 | 30,455 | [2] |
Net income attributable to noncontrolling interests | (216) | (468) | [1] | |
Net income attributable to Mueller Industries, Inc. | $ 24,128 | $ 29,987 | [1] | |
Weighted average shares for basic earnings per share (in shares) | 56,900 | 56,780 | [1] | |
Effect of dilutive stock-based awards (in shares) | 517 | 658 | [1] | |
Adjusted weighted average shares for diluted earnings per share (in shares) | 57,417 | 57,438 | [1] | |
Basic earnings per share (in dollars per share) | $ 0.42 | $ 0.53 | [1] | |
Diluted earnings per share (in dollars per share) | 0.42 | 0.52 | [1] | |
Dividends per share (in dollars per share) | $ 0.1 | $ 8.1 | [1] | |
[1] | The Condensed Consolidated Statement of Income for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The components of net periodic benefit cost (income) other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Income. Refer to Note 1 for further discussion. | |||
[2] | The Condensed Consolidated Statement of Cash Flows for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. The Condensed Consolidated Statements of Cash Flows reflects the changes during the periods in the total of cash, cash equivalents, and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown. Refer to Note 1 for further discussion. |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Apr. 01, 2017 | |||
Statement of Comprehensive Income [Abstract] | ||||
Consolidated net income | [1] | $ 24,344 | $ 30,455 | [2] |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation | 4,977 | 7,210 | ||
Net change with respect to derivative instruments and hedging activities, net of tax of $279 and $(96) | (1,062) | 56 | ||
Net change in pension and postretirement obligation adjustments, net of tax of $180 and $11 | (451) | 40 | ||
Attributable to unconsolidated affiliates, net of tax of $116 and $903 | (401) | (1,598) | ||
Other, net | 0 | (144) | ||
Total other comprehensive income, net | 3,063 | 5,564 | ||
Consolidated comprehensive income | 27,407 | 36,019 | ||
Comprehensive income attributable to noncontrolling interests | (393) | (1,117) | ||
Comprehensive income attributable to Mueller Industries, Inc. | $ 27,014 | $ 34,902 | ||
[1] | The Condensed Consolidated Statement of Income for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The components of net periodic benefit cost (income) other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Income. Refer to Note 1 for further discussion. | |||
[2] | The Condensed Consolidated Statement of Cash Flows for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. The Condensed Consolidated Statements of Cash Flows reflects the changes during the periods in the total of cash, cash equivalents, and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown. Refer to Note 1 for further discussion. |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net change with respect to derivative instruments and hedging activities, tax (expense) benefit | $ 279 | $ (96) |
Net actuarial loss on pension and postretirement obligations, tax benefit (expense) | 180 | 11 |
Attributable to unconsolidated affiliates, tax benefit (expense) | $ 116 | $ 903 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 91,573 | $ 120,269 |
Accounts receivable, less allowance for doubtful accounts of $783 in 2018 and $980 in 2017 | 321,756 | 244,795 |
Inventories | 329,231 | 327,901 |
Other current assets | 20,267 | 46,150 |
Total current assets | 762,827 | 739,115 |
Property, plant, and equipment, net | 300,074 | 304,321 |
Goodwill, net | 137,048 | 130,293 |
Intangible assets, net | 40,735 | 42,008 |
Investment in unconsolidated affiliates | 70,056 | 76,434 |
Other assets | 26,104 | 28,002 |
Total assets | 1,336,844 | 1,320,173 |
Current liabilities: | ||
Current portion of debt | 9,087 | 16,480 |
Accounts payable | 115,425 | 102,503 |
Accrued wages and other employee costs | 27,107 | 33,546 |
Other current liabilities | 61,705 | 89,723 |
Total current liabilities | 213,324 | 242,252 |
Long-term debt, less current portion | 478,778 | 448,592 |
Pension liabilities | 11,098 | 11,606 |
Postretirement benefits other than pensions | 17,051 | 17,107 |
Environmental reserves | 23,091 | 23,699 |
Deferred income taxes | 18,807 | 19,403 |
Other noncurrent liabilities | 21,630 | 21,486 |
Total liabilities | 783,779 | 784,145 |
Mueller Industries, Inc. stockholders' equity: | ||
Preferred stock - $1.00 par value; shares authorized 5,000,000; none outstanding | 0 | 0 |
Common stock - $.01 par value; shares authorized 100,000,000; issued 80,183,004; outstanding 57,564,594 in 2018 and 57,809,509 in 2017 | 802 | 802 |
Additional paid-in capital | 276,429 | 274,585 |
Retained earnings | 761,319 | 743,503 |
Accumulated other comprehensive loss | (47,614) | (51,056) |
Treasury common stock, at cost | (452,181) | (445,723) |
Total Mueller Industries, Inc. stockholders' equity | 538,755 | 522,111 |
Noncontrolling interests | 14,310 | 13,917 |
Total equity | 553,065 | 536,028 |
Commitments and contingencies | 0 | 0 |
Total liabilities and equity | $ 1,336,844 | $ 1,320,173 |
CONDENSED CONSOLIDATED BALANCE6
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Current assets: | ||
Allowance for doubtful accounts | $ 783 | $ 980 |
Mueller Industries, Inc. stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 80,183,004 | 80,183,004 |
Common stock, shares outstanding (in shares) | 57,564,594 | 57,809,509 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Apr. 01, 2017 | [2] | ||
Cash flows from operating activities | ||||
Consolidated net income | [1] | $ 24,344 | $ 30,455 | |
Reconciliation of consolidated net income to net cash used in operating activities: | ||||
Depreciation and amortization | 9,536 | 8,419 | ||
Stock-based compensation expense | 1,912 | 1,736 | ||
Loss from unconsolidated affiliates | 10,320 | 1,243 | [1] | |
Gain on disposals of properties | (676) | (16) | ||
Gain on sales of securities | 0 | (254) | ||
Impairment charge | 3,469 | 0 | ||
Deferred income taxes | (940) | (80) | ||
Changes in assets and liabilities: | ||||
Receivables | (72,843) | (53,756) | ||
Inventories | 3,504 | (6,991) | ||
Other assets | 20,967 | 1,205 | ||
Current liabilities | (23,898) | 8,215 | ||
Other liabilities | (1,845) | (668) | ||
Other, net | (365) | (930) | ||
Net cash used in operating activities | (26,515) | (11,422) | ||
Cash flows from investing activities | ||||
Capital expenditures | (5,517) | (7,345) | ||
Acquisition of businesses, net of cash acquired | (12,466) | 0 | ||
Investment in unconsolidated affiliates | (609) | 0 | ||
Proceeds from sales of assets | 708 | 192 | ||
Proceeds from sales of securities | 0 | 1,444 | ||
Net cash used in investing activities | (17,884) | (5,709) | ||
Cash flows from financing activities | ||||
Dividends paid to stockholders of Mueller Industries, Inc. | (5,679) | (179,848) | ||
Repurchase of common stock | (6,575) | 0 | ||
Issuance of long-term debt | 41,754 | 0 | ||
Repayments of long-term debt | (15,903) | (306) | ||
Repayment of debt by consolidated joint ventures, net | (3,342) | (7,367) | ||
Net cash received (used) to settle stock-based awards | 50 | (870) | ||
Net cash provided by (used in) financing activities | 10,305 | (188,391) | ||
Effect of exchange rate changes on cash | 1,289 | 2,499 | ||
Decrease in cash, cash equivalents, and restricted cash | (32,805) | (203,023) | ||
Cash, cash equivalents, and restricted cash at the beginning of the period | 126,563 | 360,469 | ||
Cash, cash equivalents, and restricted cash at the end of the period | $ 93,758 | $ 157,446 | ||
[1] | The Condensed Consolidated Statement of Income for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The components of net periodic benefit cost (income) other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Income. Refer to Note 1 for further discussion. | |||
[2] | The Condensed Consolidated Statement of Cash Flows for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. The Condensed Consolidated Statements of Cash Flows reflects the changes during the periods in the total of cash, cash equivalents, and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown. Refer to Note 1 for further discussion. |
Recent Accounting Standards
Recent Accounting Standards | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Standards | Recent Accounting Standards Adopted In February 2018, the Financial Accounting Standards Board (FASB) issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (AOCI) . The ASU permits entities to reclassify tax effects stranded in AOCI as a result of tax reform to retained earnings. The guidance is effective for the Company in interim and annual periods beginning in 2019. Early adoption is permitted and can be applied retrospectively or in the period of adoption. The Company early adopted the ASU during the first quarter of 2018, which resulted in a reclassification of $556 thousand from AOCI to retained earnings during the quarter. In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . The ASU requires employers that sponsor defined benefit pension and/or other postretirement benefit plans to present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period and other components of net periodic benefits cost separately from the line item(s) that includes the service cost and outside of any subtotal of operating income. The Company adopted the ASU during the first quarter of 2018 using a retrospective approach for each period presented, and elected to use the practical expedient that allows the Company to use the amounts previously presented in its Benefit Plans disclosure as the estimation basis for applying the retrospective presentation requirements. Prior to the adoption of the ASU, net periodic benefit cost (income) was reported within selling, general, and administrative expense in the Condensed Consolidated Statements of Income. The prior periods have been revised to conform to the current period presentation, resulting in the reclassification of $43 thousand of net periodic benefit income from operating income to other income, net for the quarter ended April 1, 2017 . In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business . The ASU provides guidance to assist entities in evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The updated guidance requires prospective adoption. Early adoption is permitted. The Company early adopted the ASU during the first quarter of 2018 and the adoption had no impact on its Condensed Consolidated Financial Statements. In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . The ASU provides correction or improvement to the guidance previously issued in ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . Under the ASU, an entity will recognize revenue to depict the transfer of promised goods or services to customers at an amount that reflects the consideration that it expects to receive in exchange for the goods or services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The ASU requires revenue to be recognized over time (i.e., throughout the production process) rather than at a point in time (generally upon shipment to the customer) if performance does not create an asset with an alternative use to the entity and the entity has an enforceable right to payment for performance completed to date. The Company adopted the ASU during the first quarter of 2018. The Company has evaluated specific contract terms, primarily within the Industrial Metals and Climate segments, related to the production of customized products and payment rights and determined that there are no significant changes to the timing or nature of revenue recognition under the ASU. As part of the overall evaluation of the standard, the Company has assessed and implemented necessary changes to its accounting policies, practices, and internal controls over financial reporting to support the standard. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash . The ASU requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. The Company adopted the ASU during the first quarter of 2018 using a retrospective approach for each period presented. Prior to the adoption of the ASU, the Company presented the change in restricted cash balances separately as a cash flow from investing activity. Upon adoption, the Company included restricted cash in each of the balances of the cash, cash equivalents, and restricted cash at the beginning and end of periods in the Condensed Consolidated Statements of Cash Flows. The prior period has been revised to conform to the current period presentation, and as a result, net cash flows for the quarter ended April 1, 2017 increased by $10.6 million . A reconciliation of cash, cash equivalents, and restricted cash as of March 31, 2018 and December 30, 2017 is as follows: (In thousands) March 31, December 30, 2017 Cash & cash equivalents $ 91,573 $ 120,269 Restricted cash included within other current assets 2,080 6,189 Restricted cash included within other assets 105 105 Total cash, cash equivalents, and restricted cash $ 93,758 $ 126,563 Amounts included in restricted cash relate to required deposits in brokerage accounts that facilitate the Company’s hedging activities as well as imprest funds for the Company’s self-insured workers’ compensation program. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory . The ASU requires companies to account for the income tax effects of intercompany transfers of assets other than inventory when the transfer occurs. Companies will still be required to defer the income tax effects of intercompany inventory transactions in an exception to the income tax accounting guidance. The Company adopted the ASU during the first quarter of 2018 and the adoption had no impact on its Condensed Consolidated Financial Statements. Issued In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . The ASU requires an entity to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses will depend on classification as a financing or operating lease. The amendments also require certain quantitative and qualitative disclosures about leasing arrangements. The ASU will be effective for interim and annual periods beginning in 2019. Early adoption is permitted. Currently the guidance requires a modified retrospective adoption, but in January 2018 the FASB proposed ASU No. 2018-01, Leases (Topic 842), which if approved will allow entities to elect a simplified transition approach whereby they would apply the provisions of the new guidance at the effective date without adjusting the comparative periods presented. The Company is still evaluating the effects that the provisions of the ASU will have on its Condensed Consolidated Financial Statements. |
Earnings per Common Share
Earnings per Common Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings per Common Share | Earnings per Common Share Basic per share amounts have been computed based on the average number of common shares outstanding. Diluted per share amounts reflect the increase in average common shares outstanding that would result from the assumed exercise of outstanding stock options and vesting of restricted stock awards, computed using the treasury stock method. There were no awards excluded from the computation of diluted earnings per share for the quarter ended March 31, 2018 , and approximately 579 thousand stock-based awards excluded from the computation of diluted earnings per share for the quarter ended April 1, 2017 because they were antidilutive. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Die-Mold On March 31, 2018, the Company entered into a share purchase agreement pursuant to which the Company acquired all of the outstanding shares of Die-Mold Tool Limited (Die-Mold) for approximately $ 12.5 million in cash, net of working capital adjustments. Die-Mold, based out of Ontario, Canada, is a manufacturer of plastic PEX and other plumbing-related fittings and an integrated designer and manufacturer of plastic injection tooling. The business complements the Company’s existing businesses within the Piping Systems segment. The fair value of the assets acquired totaled $6.0 million , consisting primarily of property, plant, and equipment of $2.1 million , inventories of $2.0 million , and accounts receivable of $1.9 million . The fair value of the liabilities assumed totaled $0.7 million , consisting primarily of accounts payable of $0.6 million and other current liabilities of $0.1 million . Of the remaining purchase price, $7.2 million was allocated to non-deductible goodwill and intangible assets. The purchase price allocation is provisional as of March 31, 2018 and subject to change upon completion of the final valuation of the long-lived assets, working capital, and contingent consideration during the measurement period. Heatlink Group On May 31, 2017, the Company entered into a share purchase agreement pursuant to which the Company acquired all of the outstanding shares of Pexcor Manufacturing Company Inc. and Heatlink Group Inc. (collectively, Heatlink Group) for approximately $16.3 million in cash, net of working capital adjustments. Heatlink Group, based out of Calgary, Alberta, Canada, produces and sells a complete line of products for PEX plumbing and radiant systems. The business complements the Company’s existing businesses within the Piping Systems segment. The fair value of the assets acquired totaled $9.9 million , consisting primarily of inventories of $4.6 million , accounts receivable of $2.8 million , property, plant, and equipment of $2.0 million , and other current assets of $0.5 million . The fair value of the liabilities assumed totaled $4.1 million , consisting primarily of accounts payable of $3.6 million , and other current liabilities of $0.5 million . Of the remaining purchase price, $10.5 million was allocated to non-deductible goodwill and intangible assets. The purchase price allocation is provisional as of March 31, 2018 and subject to change upon completion of the final valuation of the long-lived assets, working capital, and contingent consideration during the measurement period. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2018 | |
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, Die-Mold, European Operations, Trading Group, and Jungwoo-Mueller (the Company’s South Korean joint venture). The Domestic Piping Systems Group manufactures copper tube and fittings, plastic 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., Die-Mold manufactures PEX and other plumbing-related fittings and plastic injection tooling in Canada, and the European Operations manufacture copper tube in the U.K. which is sold primarily in Europe. The Trading Group manufactures pipe nipples and imports 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. 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 original equipment manufacturers (OEMs). Industrial Metals Industrial Metals is composed of the following operating segments: Brass Rod & Copper Bar Products, Impacts & Micro Gauge, and Brass Value-Added Products. These businesses manufacture brass rod, impact extrusions, and forgings, 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, Fabricated Tube Products, Westermeyer, and Turbotec. These domestic businesses manufacture and fabricate valves, assemblies, high pressure components, and coaxial heat exchangers primarily for the heating, ventilation, air-conditioning, and refrigeration markets in the U.S. Summarized segment information is as follows: For the Quarter Ended March 31, 2018 (In thousands) Piping Systems Industrial Metals Climate Corporate and Eliminations Total Net sales $ 430,964 $ 177,332 $ 36,063 $ (4,299 ) $ 640,060 Cost of goods sold 372,895 149,423 27,286 (3,934 ) 545,670 Depreciation and amortization 5,878 1,903 621 1,054 9,456 Selling, general, and administrative expense 19,242 3,373 2,609 8,833 34,057 Asset impairment — — — 3,469 3,469 Operating income 32,949 22,633 5,547 (13,721 ) 47,408 Interest expense (5,909 ) Other income, net 560 Income before income taxes $ 42,059 For the Quarter Ended April 1, 2017 (In thousands) Piping Systems Industrial Metals Climate Corporate and Eliminations Total Net sales $ 398,775 $ 149,837 $ 34,279 $ (4,971 ) $ 577,920 Cost of goods sold 344,646 124,043 25,564 (5,826 ) 488,427 Depreciation and amortization 5,342 1,898 629 486 8,355 Selling, general, and administrative expense 18,197 3,549 2,476 11,352 35,574 Operating income 30,590 20,347 5,610 (10,983 ) 45,564 Interest expense (2,531 ) Other income, net 594 Income before income taxes $ 43,627 The following tables represent a disaggregation of revenue from contracts with customers, along with the reportable segment for each category: For the Quarter Ended March 31, 2018 (In thousands) Piping Systems Industrial Metals Climate Total Tube and fittings $ 358,091 $ — $ — $ 358,091 Brass rod and forgings — 136,548 — 136,548 OEM components, tube & assemblies 7,062 15,067 36,063 58,192 Valves and plumbing specialties 65,811 — — 65,811 Other — 25,717 — 25,717 430,964 177,332 36,063 644,359 Intersegment sales (4,299 ) Net sales $ 640,060 For the Quarter Ended April 1, 2017 (In thousands) Piping Systems Industrial Metals Climate Total Tube and fittings $ 308,366 $ — $ — $ 308,366 Brass rod and forgings — 114,180 — 114,180 OEM components, tube & assemblies 31,971 13,215 34,279 79,465 Valves and plumbing specialties 58,438 — — 58,438 Other — 22,442 — 22,442 398,775 149,837 34,279 582,891 Intersegment sales (4,971 ) Net sales $ 577,920 |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories (In thousands) March 31, December 30, 2017 Raw materials and supplies $ 94,633 $ 108,397 Work-in-process 63,254 46,158 Finished goods 178,115 180,143 Valuation reserves (6,771 ) (6,797 ) Inventories $ 329,231 $ 327,901 |
Financial Instruments
Financial Instruments | 3 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | Financial Instruments Derivative Instruments and Hedging Activities The Company’s earnings and cash flows are subject to fluctuations due to changes in commodity prices, foreign currency exchange rates, and interest rates. The Company uses derivative instruments such as commodity futures contracts, foreign currency forward contracts, and interest rate swaps to manage these exposures. All derivatives are recognized in the Condensed Consolidated Balance Sheets at their fair value. On the date the derivative contract is entered into, it is either a) designated as a hedge of (i) a forecasted transaction or the variability of cash flow to be paid (cash flow hedge) or (ii) the fair value of a recognized asset or liability (fair value hedge), or b) not designated in a hedge accounting relationship, even though the derivative contract was executed to mitigate an economic exposure (economic hedge), as the Company does not enter into derivative contracts for trading purposes. Changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge are recorded in stockholders’ equity within AOCI, to the extent effective, until they are reclassified to earnings in the same period or periods during which the hedged transaction affects earnings. Changes in the fair value of a derivative that is qualified, designated, and highly effective as a fair value hedge, along with the gain or loss on the hedged recognized asset or liability that is attributable to the hedged risk, are recorded in current earnings. Changes in the fair value of undesignated derivatives executed as economic hedges and the ineffective portion of designated derivatives are reported in current earnings. The Company documents all relationships between derivative instruments and hedged items, as well as the risk-management objective and strategy for undertaking various hedge transactions. This process includes linking all derivative instruments that are designated as fair value hedges to specific assets and liabilities in the Condensed Consolidated Balance Sheets and linking cash flow hedges to specific forecasted transactions or variability of cash flow. The Company also assesses, both at the hedge’s inception and on an ongoing basis, whether the designated derivative instruments that are used in hedging transactions are highly effective in offsetting changes in cash flows or fair values of hedged items. When a derivative instrument is determined not to be highly effective as a hedge or the underlying hedged transaction is no longer probable of occurring, hedge accounting is discontinued prospectively in accordance with the derecognition criteria for hedge accounting. Commodity Futures Contracts Copper and brass represent the largest component of the Company’s variable costs of production. The cost of these materials is subject to global market fluctuations caused by factors beyond the Company’s control. The Company occasionally enters into forward fixed-price arrangements with certain customers; the risk of these arrangements is generally managed with commodity futures contracts. These futures contracts have been designated as cash flow hedges. At March 31, 2018 , the Company held open futures contracts to purchase approximately $47.8 million of copper over the next 12 months related to fixed price sales orders. The fair value of those futures contracts was a $117 thousand net loss position, which was determined by obtaining quoted market prices (level 1 within the fair value hierarchy). In the next 12 months, the Company will reclassify into earnings realized gains or losses relating to cash flow hedges. At March 31, 2018 , this amount was approximately $287 thousand of deferred net losses , net of tax. The Company may also enter into futures contracts to protect the value of inventory against market fluctuations. At March 31, 2018 , the Company held open futures contracts to sell approximately $1.7 million of copper over the next four months related to copper inventory. The fair value of those futures contracts was a $56 thousand net gain position, which was determined by obtaining quoted market prices (level 1 within the fair value hierarchy). The Company presents its derivative assets and liabilities in the Condensed Consolidated Balance Sheets on a net basis by counterparty. The following table summarizes the location and fair value of the derivative instruments and disaggregates the net derivative assets and liabilities into gross components on a contract-by-contract basis: Asset Derivatives Liability Derivatives Fair Value Fair Value (In thousands) Balance Sheet Location March 31, 2018 December 30, 2017 Balance Sheet Location March 31, 2018 December 30, 2017 Commodity contracts - gains Other current assets $ 319 $ 1,014 Other current liabilities $ 75 $ 55 Commodity contracts - losses Other current assets (15 ) (5 ) Other current liabilities (440 ) (3,210 ) Total derivatives (1) $ 304 $ 1,009 $ (365 ) $ (3,155 ) (1) Does not include the impact of cash collateral provided to counterparties. The following tables summarize the effects of derivative instruments on the Company’s Condensed Consolidated Statements of Income: For the Quarter Ended (In thousands) Location March 31, 2018 April 1, Fair value hedges: Gain on commodity contracts (qualifying) Cost of goods sold $ 391 $ — (Loss) gain on hedged item - inventory Cost of goods sold (385 ) — Undesignated derivatives: Gain (loss) on commodity contracts (nonqualifying) Cost of goods sold 6,126 (1,095 ) The following tables summarize amounts recognized in and reclassified from AOCI during the period: For the Quarter Ended March 31, 2018 (In thousands) (Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax Classification Gains (Losses) (Gain) Loss Reclassified from AOCI (Effective Portion), Net of Tax Cash flow hedges: Commodity contracts $ (795 ) Cost of goods sold $ (292 ) Other 25 Other — Total $ (770 ) Total $ (292 ) Derivative instruments and hedging activities (continued): For the Quarter Ended April 1, 2017 (In thousands) (Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax Classification Gains (Losses) Loss Reclassified from AOCI (Effective Portion), Net of Tax Cash flow hedges: Commodity contracts $ (563 ) Cost of goods sold $ 352 Interest rate swap — Interest expense 149 Other 118 Other — Total $ (445 ) Total $ 501 The Company enters into futures and forward contracts that closely match the terms of the underlying transactions. As a result, the ineffective portion of the qualifying open hedge contracts through March 31, 2018 was not material to the Condensed Consolidated Statements of Income. The Company primarily enters into International Swaps and Derivatives Association master netting agreements with major financial institutions that permit the net settlement of amounts owed under their respective derivative contracts. Under these master netting agreements, net settlement generally permits the Company or the counterparty to determine the net amount payable for contracts due on the same date and in the same currency for similar types of derivative transactions. The master netting agreements generally also provide for net settlement of all outstanding contracts with a counterparty in the case of an event of default or a termination event. The Company does not offset fair value amounts for derivative instruments and fair value amounts recognized for the right to reclaim cash collateral. At March 31, 2018 and December 30, 2017 , the Company had recorded restricted cash in other current assets of $1.3 million and $5.3 million , respectively, as collateral related to open derivative contracts under the master netting arrangements. Long-Term Debt The fair value of long-term debt at March 31, 2018 approximates the carrying value on that date. The estimated fair values were determined based on quoted market prices and the current rates offered for debt with similar terms and maturities. The fair value of long-term debt is classified as level 2 within the fair value hierarchy. This classification is defined as a fair value determined using market-based inputs other than quoted prices that are observable for the liability, either directly or indirectly. |
Investment in Unconsolidated Af
Investment in Unconsolidated Affiliates | 3 Months Ended |
Mar. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Unconsolidated Affiliates | Investment in Unconsolidated Affiliates Tecumseh The Company owns a 50 percent interest in an unconsolidated affiliate that acquired Tecumseh Products Company LLC (Tecumseh). The Company also owns a 50 percent interest in a second unconsolidated affiliate that provides financing to Tecumseh. These investments are recorded using the equity method of accounting, as the Company can exercise significant influence but does not own a majority equity interest or otherwise control the respective entities. Under the equity method of accounting, these investments are stated at initial cost and are adjusted for subsequent additional investments and the Company’s proportionate share of earnings or losses and distributions. The Company records its proportionate share of the investees’ income or loss, net of foreign taxes, one quarter in arrears as income (loss) from unconsolidated affiliates, net of foreign tax, in the Condensed Consolidated Statements of Income and its proportionate share of the investees’ other comprehensive income (loss), net of income taxes, in the Condensed Consolidated Statements of Comprehensive Income. The U.S. tax effect of the Company’s proportionate share of Tecumseh’s income or loss is recorded in income tax expense in the Condensed Consolidated Statements of Income. In general, the equity investment in unconsolidated affiliates is equal to the current equity investment plus the investees’ undistributed earnings. The following tables present summarized financial information derived from the Company’s equity method investees’ combined consolidated financial statements, which are prepared in accordance with U.S. GAAP. (In thousands) March 31, December 30, 2017 Current assets $ 230,289 $ 246,127 Noncurrent assets 128,200 139,200 Current liabilities 164,309 174,710 Noncurrent liabilities 61,183 58,334 For the Quarter Ended (In thousands) March 31, 2018 April 1, Net sales $ 124,100 $ 126,300 Gross profit 12,100 15,600 Net loss (18,331 ) (2,487 ) The Company’s loss from unconsolidated affiliates, net of foreign tax, for the quarter ended March 31, 2018 included net losses of $6.2 million and charges of $3.0 million related to certain labor claim contingencies for Tecumseh. Bahrain On December 30, 2015, the Company entered into a joint venture agreement with Cayan Ventures and Bahrain Mumtalakat Holding Company to build a copper tube mill in Bahrain. The business will operate and brand its products under the Mueller Industries family of brands. The Company has invested approximately $4.5 million of cash to date and will be the technical and marketing lead in return for 40 percent ownership in the joint venture. The Company’s loss from unconsolidated affiliates, net of foreign tax, for the quarter ended March 31, 2018 included net losses of $1.1 million for Bahrain. |
Benefit Plans
Benefit Plans | 3 Months Ended |
Mar. 31, 2018 | |
Compensation and Retirement Disclosure [Abstract] | |
Benefit Plans | Benefit Plans The Company sponsors several qualified and nonqualified pension plans and other postretirement benefit plans for certain of its employees. The components of net periodic benefit cost (income) are as follows: For the Quarter Ended (In thousands) March 31, 2018 April 1, Pension benefits: Service cost $ 24 $ 35 Interest cost 1,493 1,665 Expected return on plan assets (2,289 ) (2,182 ) Amortization of net loss 349 556 Net periodic benefit (income) cost $ (423 ) $ 74 Other benefits: Service cost $ 60 $ 56 Interest cost 148 149 Amortization of prior service credit (226 ) (225 ) Amortization of net loss (gain) 18 (5 ) Net periodic benefit income $ — $ (25 ) The components of net periodic benefit cost (income) other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Income. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is involved in certain litigation as a result of claims that arose in the ordinary course of business, which management believes will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows. The Company may also realize the benefit of certain legal claims and litigation in the future; these gain contingencies are not recognized in the Condensed Consolidated Financial Statements. Guarantees Guarantees, in the form of letters of credit, are issued by the Company generally to assure the payment of insurance deductibles and certain retiree health benefits. The terms of the guarantees are generally one year but are renewable annually as required. These letters are primarily backed by the Company’s revolving credit facility. The maximum payments that the Company could be required to make under its guarantees at March 31, 2018 were $8.0 million . |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s effective tax rate for the first quarter of 2018 was 18 percent compared with 27 percent for the same period last year. The difference between the Company’s effective tax rate and the current U.S. statutory rate of 21 percent is primarily related to tax benefits from losses on investments in unconsolidated affiliates of $3.9 million , which was partially offset by increases related to the provision for state income taxes, net of the federal benefit, of $1.2 million , and other items of $1.2 million . The Company is forecasting an annual effective tax rate between 21 percent and 23 percent. The Company records the U.S. tax effects of its investment in Tecumseh, an unconsolidated affiliate, in income tax expense in the Condensed Consolidated Statements of Income. The Tax Cuts and Jobs Act (the Act) was enacted on December 22, 2017. The Act reduced the U.S. federal corporate income tax rate from 35 percent to 21 percent, requires companies to pay a one-time transition tax on the accumulated earnings of certain foreign subsidiaries, and creates new taxes on certain foreign-sourced earnings. The Company is applying the guidance in SAB 118 in accounting for the enactment date effects of the Act. At December 30, 2017 , the Company made a reasonable estimate of the one-time transition tax on accumulated foreign earnings as well as the impact of the Act on its existing deferred tax balances. As discussed below, the Company has not completed its accounting for the tax effects of the Act as of March 31, 2018 . The one-time transition tax is based on the Company’s total post-1986 earnings and profits (E&P) for which the accrual of U.S. income taxes had previously been deferred. The Company recorded a provisional amount for its one-time transition tax liability of $12.9 million at December 30, 2017, and has not adjusted this amount as of March 31, 2018 . The Company has not yet completed its calculation of the total post-1986 foreign E&P for these foreign subsidiaries. Further, the transition tax is impacted in part by the amount of those earnings held in cash and other specified assets. Accordingly, the Company’s estimate of the one-time transition tax may change when it finalizes the calculation of post-1986 foreign E&P previously deferred from U.S. federal taxation and finalizes the amounts held in cash or other specified assets. At December 30, 2017 , the Company remeasured certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21 percent. A provisional tax benefit of $12.1 million was recorded, and no adjustment was recorded to this estimate in the current quarter. The Company is still analyzing certain aspects of the Act and refining its calculations, which could potentially affect the measurement of these balances. The global intangible low-taxed income (GILTI) provisions of the Act impose a tax on the GILTI earned by certain foreign subsidiaries. The FASB Staff Q&A, Topic 740, No. 5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred. Given the complexity of the GILTI provisions, the Company is still evaluating the effects of these provisions and has not yet determined the new accounting policy. No estimate was recorded for GILTI as of December 30, 2017 . At March 31, 2018 , because the Company is still assessing the GILTI provisions and future income subject to the GILTI provisions, it has included an estimate of the tax on GILTI related to current-year operations in the forecasted effective tax rate and has not provided additional GILTI on deferred items. The Company’s effective tax rate for the first quarter of 2017 was 27 percent . The difference between the Company’s effective tax rate and the 2017 U.S. statutory rate of 35 percent was primarily attributable to reductions for the U.S. production activities deduction of $0.9 million , the effect of foreign tax rates lower than statutory rates of $1.4 million , the tax benefit of equity compensation deductions of $1.7 million , and the impact of tax benefits from losses on investments in unconsolidated affiliates of $0.8 million . These items were partially offset by the provision for state income taxes, net of the federal benefit, of $0.9 million . The Company files a consolidated U.S. federal income tax return and numerous consolidated and separate-company income tax returns in many state, local, and foreign jurisdictions. The statute of limitations is open for the Company’s federal tax return and most state income tax returns for 2014 and all subsequent years and is open for certain state and foreign returns for earlier tax years due to ongoing audits and differing statute periods. While the Company believes that it is adequately reserved for possible future audit adjustments, the final resolution of these examinations cannot be determined with certainty and could result in final settlements that differ from current estimates. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) AOCI includes certain foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency, net deferred gains and losses on certain derivative instruments accounted for as cash flow hedges, adjustments to pension and OPEB liabilities, unrealized gains and losses on marketable securities classified as available-for-sale, and other comprehensive income attributable to unconsolidated affiliates. The following table provides changes in AOCI by component, net of taxes and noncontrolling interests (amounts in parentheses indicate debits to AOCI): For the Quarter Ended March 31, 2018 (In thousands) Cumulative Translation Adjustment Unrealized Gain (Loss) on Derivatives Pension/OPEB Liability Adjustment Unrealized Gain on Equity Securities Attributable to Unconsol. Affiliates Total Balance as of December 30, 2017 $ (38,163 ) $ 847 $ (20,610 ) — $ 6,870 $ (51,056 ) Other comprehensive income (loss) before reclassifications 4,800 (770 ) (570 ) — (401 ) 3,059 Amounts reclassified from AOCI — (292 ) 119 — — (173 ) Net current-period other comprehensive income (loss) 4,800 (1,062 ) (451 ) — (401 ) 2,886 Reclassification of stranded effects of the Act — 112 (1,018 ) — 1,462 556 Balance as of March 31, 2018 $ (33,363 ) $ (103 ) $ (22,079 ) — $ 7,931 $ (47,614 ) For the Quarter Ended April 1, 2017 (In thousands) Cumulative Translation Adjustment Unrealized (Loss) Gain on Derivatives Pension/OPEB Liability Adjustment Unrealized Gain (Loss) on Equity Securities Attributable to Unconsol. Affiliates Total Balance as of December 31, 2016 $ (49,965 ) $ (300 ) $ (23,046 ) 380 $ 5,975 $ (66,956 ) Other comprehensive income (loss) before reclassifications 6,561 (445 ) (222 ) 16 (1,598 ) 4,312 Amounts reclassified from AOCI — 501 262 (160 ) — 603 Net current-period other comprehensive income (loss) 6,561 56 40 (144 ) (1,598 ) 4,915 Balance as of April 1, 2017 $ (43,404 ) $ (244 ) $ (23,006 ) 236 $ 4,377 $ (62,041 ) Reclassification adjustments out of AOCI were as follows: Amount reclassified from AOCI For the Quarter Ended (In thousands) March 31, 2018 April 1, 2017 Affected line item Unrealized losses (gains) on derivatives: Commodity contracts $ (365 ) $ 422 Cost of goods sold Interest rate swap — 232 Interest expense 73 (153 ) Income tax expense (benefit) $ (292 ) $ 501 Net of tax and noncontrolling interests Amortization of net loss and prior service cost on employee benefit plans $ 141 $ 326 Other income, net (22 ) (64 ) Income tax benefit $ 119 $ 262 Net of tax and noncontrolling interests Sale of available-for-sale securities $ — $ (254 ) Other income, net $ — $ 94 Income tax expense $ — $ (160 ) Net of tax and noncontrolling interests |
Noncontrolling Interests
Noncontrolling Interests | 3 Months Ended |
Mar. 31, 2018 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | Noncontrolling Interests (In thousands) Noncontrolling Interests Balance as of December 30, 2017 $ 13,917 Net income attributable to noncontrolling interests 216 Other comprehensive income attributable to noncontrolling interests, net of tax: Foreign currency translation 177 Balance as of March 31, 2018 $ 14,310 |
Recent Accounting Standards (Po
Recent Accounting Standards (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Recently Issued Accounting Standards | Adopted In February 2018, the Financial Accounting Standards Board (FASB) issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (AOCI) . The ASU permits entities to reclassify tax effects stranded in AOCI as a result of tax reform to retained earnings. The guidance is effective for the Company in interim and annual periods beginning in 2019. Early adoption is permitted and can be applied retrospectively or in the period of adoption. The Company early adopted the ASU during the first quarter of 2018, which resulted in a reclassification of $556 thousand from AOCI to retained earnings during the quarter. In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . The ASU requires employers that sponsor defined benefit pension and/or other postretirement benefit plans to present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period and other components of net periodic benefits cost separately from the line item(s) that includes the service cost and outside of any subtotal of operating income. The Company adopted the ASU during the first quarter of 2018 using a retrospective approach for each period presented, and elected to use the practical expedient that allows the Company to use the amounts previously presented in its Benefit Plans disclosure as the estimation basis for applying the retrospective presentation requirements. Prior to the adoption of the ASU, net periodic benefit cost (income) was reported within selling, general, and administrative expense in the Condensed Consolidated Statements of Income. The prior periods have been revised to conform to the current period presentation, resulting in the reclassification of $43 thousand of net periodic benefit income from operating income to other income, net for the quarter ended April 1, 2017 . In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business . The ASU provides guidance to assist entities in evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The updated guidance requires prospective adoption. Early adoption is permitted. The Company early adopted the ASU during the first quarter of 2018 and the adoption had no impact on its Condensed Consolidated Financial Statements. In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers . The ASU provides correction or improvement to the guidance previously issued in ASU 2014-09, Revenue from Contracts with Customers (Topic 606) . Under the ASU, an entity will recognize revenue to depict the transfer of promised goods or services to customers at an amount that reflects the consideration that it expects to receive in exchange for the goods or services. It also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The ASU requires revenue to be recognized over time (i.e., throughout the production process) rather than at a point in time (generally upon shipment to the customer) if performance does not create an asset with an alternative use to the entity and the entity has an enforceable right to payment for performance completed to date. The Company adopted the ASU during the first quarter of 2018. The Company has evaluated specific contract terms, primarily within the Industrial Metals and Climate segments, related to the production of customized products and payment rights and determined that there are no significant changes to the timing or nature of revenue recognition under the ASU. As part of the overall evaluation of the standard, the Company has assessed and implemented necessary changes to its accounting policies, practices, and internal controls over financial reporting to support the standard. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash . The ASU requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. The Company adopted the ASU during the first quarter of 2018 using a retrospective approach for each period presented. Prior to the adoption of the ASU, the Company presented the change in restricted cash balances separately as a cash flow from investing activity. Upon adoption, the Company included restricted cash in each of the balances of the cash, cash equivalents, and restricted cash at the beginning and end of periods in the Condensed Consolidated Statements of Cash Flows. The prior period has been revised to conform to the current period presentation, and as a result, net cash flows for the quarter ended April 1, 2017 increased by $10.6 million . A reconciliation of cash, cash equivalents, and restricted cash as of March 31, 2018 and December 30, 2017 is as follows: (In thousands) March 31, December 30, 2017 Cash & cash equivalents $ 91,573 $ 120,269 Restricted cash included within other current assets 2,080 6,189 Restricted cash included within other assets 105 105 Total cash, cash equivalents, and restricted cash $ 93,758 $ 126,563 Amounts included in restricted cash relate to required deposits in brokerage accounts that facilitate the Company’s hedging activities as well as imprest funds for the Company’s self-insured workers’ compensation program. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory . The ASU requires companies to account for the income tax effects of intercompany transfers of assets other than inventory when the transfer occurs. Companies will still be required to defer the income tax effects of intercompany inventory transactions in an exception to the income tax accounting guidance. The Company adopted the ASU during the first quarter of 2018 and the adoption had no impact on its Condensed Consolidated Financial Statements. Issued In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . The ASU requires an entity to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses will depend on classification as a financing or operating lease. The amendments also require certain quantitative and qualitative disclosures about leasing arrangements. The ASU will be effective for interim and annual periods beginning in 2019. Early adoption is permitted. Currently the guidance requires a modified retrospective adoption, but in January 2018 the FASB proposed ASU No. 2018-01, Leases (Topic 842), which if approved will allow entities to elect a simplified transition approach whereby they would apply the provisions of the new guidance at the effective date without adjusting the comparative periods presented. The Company is still evaluating the effects that the provisions of the ASU will have on its Condensed Consolidated Financial Statements. |
Recent Accounting Standards (Ta
Recent Accounting Standards (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Cash, Cash Equivalents and Restricted Cash | A reconciliation of cash, cash equivalents, and restricted cash as of March 31, 2018 and December 30, 2017 is as follows: (In thousands) March 31, December 30, 2017 Cash & cash equivalents $ 91,573 $ 120,269 Restricted cash included within other current assets 2,080 6,189 Restricted cash included within other assets 105 105 Total cash, cash equivalents, and restricted cash $ 93,758 $ 126,563 |
Schedule of Cash, Cash Equivalents and Restricted Cash | A reconciliation of cash, cash equivalents, and restricted cash as of March 31, 2018 and December 30, 2017 is as follows: (In thousands) March 31, December 30, 2017 Cash & cash equivalents $ 91,573 $ 120,269 Restricted cash included within other current assets 2,080 6,189 Restricted cash included within other assets 105 105 Total cash, cash equivalents, and restricted cash $ 93,758 $ 126,563 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Summary of Segment Information | Summarized segment information is as follows: For the Quarter Ended March 31, 2018 (In thousands) Piping Systems Industrial Metals Climate Corporate and Eliminations Total Net sales $ 430,964 $ 177,332 $ 36,063 $ (4,299 ) $ 640,060 Cost of goods sold 372,895 149,423 27,286 (3,934 ) 545,670 Depreciation and amortization 5,878 1,903 621 1,054 9,456 Selling, general, and administrative expense 19,242 3,373 2,609 8,833 34,057 Asset impairment — — — 3,469 3,469 Operating income 32,949 22,633 5,547 (13,721 ) 47,408 Interest expense (5,909 ) Other income, net 560 Income before income taxes $ 42,059 For the Quarter Ended April 1, 2017 (In thousands) Piping Systems Industrial Metals Climate Corporate and Eliminations Total Net sales $ 398,775 $ 149,837 $ 34,279 $ (4,971 ) $ 577,920 Cost of goods sold 344,646 124,043 25,564 (5,826 ) 488,427 Depreciation and amortization 5,342 1,898 629 486 8,355 Selling, general, and administrative expense 18,197 3,549 2,476 11,352 35,574 Operating income 30,590 20,347 5,610 (10,983 ) 45,564 Interest expense (2,531 ) Other income, net 594 Income before income taxes $ 43,627 |
Disaggregation of Revenue From Contracts with Customers | The following tables represent a disaggregation of revenue from contracts with customers, along with the reportable segment for each category: For the Quarter Ended March 31, 2018 (In thousands) Piping Systems Industrial Metals Climate Total Tube and fittings $ 358,091 $ — $ — $ 358,091 Brass rod and forgings — 136,548 — 136,548 OEM components, tube & assemblies 7,062 15,067 36,063 58,192 Valves and plumbing specialties 65,811 — — 65,811 Other — 25,717 — 25,717 430,964 177,332 36,063 644,359 Intersegment sales (4,299 ) Net sales $ 640,060 For the Quarter Ended April 1, 2017 (In thousands) Piping Systems Industrial Metals Climate Total Tube and fittings $ 308,366 $ — $ — $ 308,366 Brass rod and forgings — 114,180 — 114,180 OEM components, tube & assemblies 31,971 13,215 34,279 79,465 Valves and plumbing specialties 58,438 — — 58,438 Other — 22,442 — 22,442 398,775 149,837 34,279 582,891 Intersegment sales (4,971 ) Net sales $ 577,920 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventories | (In thousands) March 31, December 30, 2017 Raw materials and supplies $ 94,633 $ 108,397 Work-in-process 63,254 46,158 Finished goods 178,115 180,143 Valuation reserves (6,771 ) (6,797 ) Inventories $ 329,231 $ 327,901 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments Designated as Cash Flow Hedges Reflected in the Financial Statements | The following table summarizes the location and fair value of the derivative instruments and disaggregates the net derivative assets and liabilities into gross components on a contract-by-contract basis: Asset Derivatives Liability Derivatives Fair Value Fair Value (In thousands) Balance Sheet Location March 31, 2018 December 30, 2017 Balance Sheet Location March 31, 2018 December 30, 2017 Commodity contracts - gains Other current assets $ 319 $ 1,014 Other current liabilities $ 75 $ 55 Commodity contracts - losses Other current assets (15 ) (5 ) Other current liabilities (440 ) (3,210 ) Total derivatives (1) $ 304 $ 1,009 $ (365 ) $ (3,155 ) (1) Does not include the impact of cash collateral provided to counterparties. |
Schedule of Fair Value Hedges | The following tables summarize the effects of derivative instruments on the Company’s Condensed Consolidated Statements of Income: For the Quarter Ended (In thousands) Location March 31, 2018 April 1, Fair value hedges: Gain on commodity contracts (qualifying) Cost of goods sold $ 391 $ — (Loss) gain on hedged item - inventory Cost of goods sold (385 ) — Undesignated derivatives: Gain (loss) on commodity contracts (nonqualifying) Cost of goods sold 6,126 (1,095 ) |
Summary of Activities Related to Derivative Instruments Classified as Cash Flow Hedges | The following tables summarize amounts recognized in and reclassified from AOCI during the period: For the Quarter Ended March 31, 2018 (In thousands) (Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax Classification Gains (Losses) (Gain) Loss Reclassified from AOCI (Effective Portion), Net of Tax Cash flow hedges: Commodity contracts $ (795 ) Cost of goods sold $ (292 ) Other 25 Other — Total $ (770 ) Total $ (292 ) Derivative instruments and hedging activities (continued): For the Quarter Ended April 1, 2017 (In thousands) (Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax Classification Gains (Losses) Loss Reclassified from AOCI (Effective Portion), Net of Tax Cash flow hedges: Commodity contracts $ (563 ) Cost of goods sold $ 352 Interest rate swap — Interest expense 149 Other 118 Other — Total $ (445 ) Total $ 501 |
Investment in Unconsolidated 25
Investment in Unconsolidated Affiliates (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summarized Financial Information Derived From the Company's Equity Method Investee's Consolidated Financial Statements | The following tables present summarized financial information derived from the Company’s equity method investees’ combined consolidated financial statements, which are prepared in accordance with U.S. GAAP. (In thousands) March 31, December 30, 2017 Current assets $ 230,289 $ 246,127 Noncurrent assets 128,200 139,200 Current liabilities 164,309 174,710 Noncurrent liabilities 61,183 58,334 For the Quarter Ended (In thousands) March 31, 2018 April 1, Net sales $ 124,100 $ 126,300 Gross profit 12,100 15,600 Net loss (18,331 ) (2,487 ) |
Benefit Plans (Tables)
Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Compensation and Retirement Disclosure [Abstract] | |
Components of Net Periodic Benefit Cost (Income) | The components of net periodic benefit cost (income) are as follows: For the Quarter Ended (In thousands) March 31, 2018 April 1, Pension benefits: Service cost $ 24 $ 35 Interest cost 1,493 1,665 Expected return on plan assets (2,289 ) (2,182 ) Amortization of net loss 349 556 Net periodic benefit (income) cost $ (423 ) $ 74 Other benefits: Service cost $ 60 $ 56 Interest cost 148 149 Amortization of prior service credit (226 ) (225 ) Amortization of net loss (gain) 18 (5 ) Net periodic benefit income $ — $ (25 ) |
Accumulated Other Comprehensi27
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
Changes in AOCI by Component, Net of Taxes and Noncontrolling Interest | The following table provides changes in AOCI by component, net of taxes and noncontrolling interests (amounts in parentheses indicate debits to AOCI): For the Quarter Ended March 31, 2018 (In thousands) Cumulative Translation Adjustment Unrealized Gain (Loss) on Derivatives Pension/OPEB Liability Adjustment Unrealized Gain on Equity Securities Attributable to Unconsol. Affiliates Total Balance as of December 30, 2017 $ (38,163 ) $ 847 $ (20,610 ) — $ 6,870 $ (51,056 ) Other comprehensive income (loss) before reclassifications 4,800 (770 ) (570 ) — (401 ) 3,059 Amounts reclassified from AOCI — (292 ) 119 — — (173 ) Net current-period other comprehensive income (loss) 4,800 (1,062 ) (451 ) — (401 ) 2,886 Reclassification of stranded effects of the Act — 112 (1,018 ) — 1,462 556 Balance as of March 31, 2018 $ (33,363 ) $ (103 ) $ (22,079 ) — $ 7,931 $ (47,614 ) For the Quarter Ended April 1, 2017 (In thousands) Cumulative Translation Adjustment Unrealized (Loss) Gain on Derivatives Pension/OPEB Liability Adjustment Unrealized Gain (Loss) on Equity Securities Attributable to Unconsol. Affiliates Total Balance as of December 31, 2016 $ (49,965 ) $ (300 ) $ (23,046 ) 380 $ 5,975 $ (66,956 ) Other comprehensive income (loss) before reclassifications 6,561 (445 ) (222 ) 16 (1,598 ) 4,312 Amounts reclassified from AOCI — 501 262 (160 ) — 603 Net current-period other comprehensive income (loss) 6,561 56 40 (144 ) (1,598 ) 4,915 Balance as of April 1, 2017 $ (43,404 ) $ (244 ) $ (23,006 ) 236 $ 4,377 $ (62,041 ) |
Reclassification Adjustments Out of AOCI | Reclassification adjustments out of AOCI were as follows: Amount reclassified from AOCI For the Quarter Ended (In thousands) March 31, 2018 April 1, 2017 Affected line item Unrealized losses (gains) on derivatives: Commodity contracts $ (365 ) $ 422 Cost of goods sold Interest rate swap — 232 Interest expense 73 (153 ) Income tax expense (benefit) $ (292 ) $ 501 Net of tax and noncontrolling interests Amortization of net loss and prior service cost on employee benefit plans $ 141 $ 326 Other income, net (22 ) (64 ) Income tax benefit $ 119 $ 262 Net of tax and noncontrolling interests Sale of available-for-sale securities $ — $ (254 ) Other income, net $ — $ 94 Income tax expense $ — $ (160 ) Net of tax and noncontrolling interests |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Noncontrolling Interest [Abstract] | |
Schedule of Noncontrolling Interests | (In thousands) Noncontrolling Interests Balance as of December 30, 2017 $ 13,917 Net income attributable to noncontrolling interests 216 Other comprehensive income attributable to noncontrolling interests, net of tax: Foreign currency translation 177 Balance as of March 31, 2018 $ 14,310 |
Recent Accounting Standards - A
Recent Accounting Standards - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Reclassification of stranded effects of the Act | $ 556 | ||
Increase in cash flows | $ (32,805) | $ (203,023) | [1] |
ASU 2016-18 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Increase in cash flows | 10,600 | ||
Operating Income [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net periodic benefit income | 43 | ||
Other Income [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net periodic benefit income | $ (43) | ||
[1] | The Condensed Consolidated Statement of Cash Flows for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. The Condensed Consolidated Statements of Cash Flows reflects the changes during the periods in the total of cash, cash equivalents, and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown. Refer to Note 1 for further discussion. |
Recent Accounting Standards - R
Recent Accounting Standards - Reconciliation of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 | Apr. 01, 2017 | [1] | Dec. 31, 2016 | [1] |
Accounting Changes and Error Corrections [Abstract] | ||||||
Cash & cash equivalents | $ 91,573 | $ 120,269 | ||||
Restricted cash included within other current assets | 2,080 | 6,189 | ||||
Restricted cash included within other assets | 105 | 105 | ||||
Total cash, cash equivalents, and restricted cash | $ 93,758 | $ 126,563 | $ 157,446 | $ 360,469 | ||
[1] | The Condensed Consolidated Statement of Cash Flows for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. The Condensed Consolidated Statements of Cash Flows reflects the changes during the periods in the total of cash, cash equivalents, and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown. Refer to Note 1 for further discussion. |
Earnings per Common Share (Deta
Earnings per Common Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Earnings Per Share [Abstract] | ||
Stock-based awards excluded from the computation of diluted earnings per share (in shares) | 0 | 579 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Millions | Mar. 31, 2018 | May 31, 2017 |
Die-Mold [Member] | ||
Business Acquisition [Line Items] | ||
Consideration transferred net of working capital adjustments | $ 12.5 | |
Fair value of assets acquired | 6 | |
Fair value of property, plant and equipment acquired | 2.1 | |
Fair value of inventories acquired | 2 | |
Fair value of accounts receivable acquired | 1.9 | |
Fair value of liabilities acquired | 0.7 | |
Fair value of accounts payable acquired | 0.6 | |
Fair value of other current liabilities acquired | 0.1 | |
Allocation to non-deductible goodwill and intangible assets | $ 7.2 | |
Pexcor/Heatlink [Member] | ||
Business Acquisition [Line Items] | ||
Consideration transferred net of working capital adjustments | $ 16.3 | |
Fair value of assets acquired | 9.9 | |
Fair value of property, plant and equipment acquired | 2 | |
Fair value of inventories acquired | 4.6 | |
Fair value of accounts receivable acquired | 2.8 | |
Fair value of liabilities acquired | 4.1 | |
Fair value of accounts payable acquired | 3.6 | |
Fair value of other current liabilities acquired | 0.5 | |
Allocation to non-deductible goodwill and intangible assets | 10.5 | |
Fair value of other current assets acquired | $ 0.5 |
Segment Information - Summary o
Segment Information - Summary of Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | ||
Summary of segment information [Abstract] | |||
Net sales | $ 640,060 | $ 577,920 | [1] |
Cost of goods sold | 545,670 | 488,427 | [1] |
Depreciation and amortization | 9,456 | 8,355 | [1] |
Selling, general, and administrative expense | 34,057 | 35,574 | [1] |
Asset impairment | 3,469 | 0 | [2] |
Operating income | 47,408 | 45,564 | [1] |
Interest expense | (5,909) | (2,531) | [1] |
Other income, net | 560 | 594 | [1] |
Income before income taxes | 42,059 | 43,627 | [1] |
Operating Segments [Member] | Piping Systems [Member] | |||
Summary of segment information [Abstract] | |||
Net sales | 430,964 | 398,775 | |
Cost of goods sold | 372,895 | 344,646 | |
Depreciation and amortization | 5,878 | 5,342 | |
Selling, general, and administrative expense | 19,242 | 18,197 | |
Asset impairment | 0 | ||
Operating income | 32,949 | 30,590 | |
Operating Segments [Member] | Industrial Metals [Member] | |||
Summary of segment information [Abstract] | |||
Net sales | 177,332 | 149,837 | |
Cost of goods sold | 149,423 | 124,043 | |
Depreciation and amortization | 1,903 | 1,898 | |
Selling, general, and administrative expense | 3,373 | 3,549 | |
Asset impairment | 0 | ||
Operating income | 22,633 | 20,347 | |
Operating Segments [Member] | Climate [Member] | |||
Summary of segment information [Abstract] | |||
Net sales | 36,063 | 34,279 | |
Cost of goods sold | 27,286 | 25,564 | |
Depreciation and amortization | 621 | 629 | |
Selling, general, and administrative expense | 2,609 | 2,476 | |
Asset impairment | 0 | ||
Operating income | 5,547 | 5,610 | |
Corporate and Eliminations [Member] | |||
Summary of segment information [Abstract] | |||
Net sales | (4,299) | (4,971) | |
Cost of goods sold | (3,934) | (5,826) | |
Depreciation and amortization | 1,054 | 486 | |
Selling, general, and administrative expense | 8,833 | 11,352 | |
Asset impairment | 3,469 | ||
Operating income | $ (13,721) | $ (10,983) | |
[1] | The Condensed Consolidated Statement of Income for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The components of net periodic benefit cost (income) other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Income. Refer to Note 1 for further discussion. | ||
[2] | The Condensed Consolidated Statement of Cash Flows for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. The Condensed Consolidated Statements of Cash Flows reflects the changes during the periods in the total of cash, cash equivalents, and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown. Refer to Note 1 for further discussion. |
Segment Information - Net Sales
Segment Information - Net Sales by Major Product Line (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | $ 644,359 | $ 582,891 |
Tube and fittings [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 358,091 | 308,366 |
Brass rod and forgings [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 136,548 | 114,180 |
OEM components, tube and assemblies [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 58,192 | 79,465 |
Valves and plumbing specialties [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 65,811 | 58,438 |
Other products [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 25,717 | 22,442 |
Operating Segments [Member] | Piping Systems [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 430,964 | 398,775 |
Operating Segments [Member] | Industrial Metals [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 177,332 | 149,837 |
Operating Segments [Member] | Climate [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 36,063 | 34,279 |
Operating Segments [Member] | Tube and fittings [Member] | Piping Systems [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 358,091 | 308,366 |
Operating Segments [Member] | Tube and fittings [Member] | Industrial Metals [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Operating Segments [Member] | Tube and fittings [Member] | Climate [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Operating Segments [Member] | Brass rod and forgings [Member] | Piping Systems [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Operating Segments [Member] | Brass rod and forgings [Member] | Industrial Metals [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 136,548 | 114,180 |
Operating Segments [Member] | Brass rod and forgings [Member] | Climate [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Operating Segments [Member] | OEM components, tube and assemblies [Member] | Piping Systems [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 7,062 | 31,971 |
Operating Segments [Member] | OEM components, tube and assemblies [Member] | Industrial Metals [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 15,067 | 13,215 |
Operating Segments [Member] | OEM components, tube and assemblies [Member] | Climate [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 36,063 | 34,279 |
Operating Segments [Member] | Valves and plumbing specialties [Member] | Piping Systems [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 65,811 | 58,438 |
Operating Segments [Member] | Valves and plumbing specialties [Member] | Industrial Metals [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Operating Segments [Member] | Valves and plumbing specialties [Member] | Climate [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Operating Segments [Member] | Other products [Member] | Piping Systems [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Operating Segments [Member] | Other products [Member] | Industrial Metals [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 25,717 | 22,442 |
Operating Segments [Member] | Other products [Member] | Climate [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales | 0 | 0 |
Intersegment Sales [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net sales |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Inventory Disclosure [Abstract] | ||
Raw materials and supplies | $ 94,633 | $ 108,397 |
Work-in-process | 63,254 | 46,158 |
Finished goods | 178,115 | 180,143 |
Valuation reserves | (6,771) | (6,797) |
Inventories | $ 329,231 | $ 327,901 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 30, 2017 | |
Derivative [Line Items] | ||
Restricted cash in other current assets as collateral related to open derivative contracts | $ 1,300 | $ 5,300 |
Commodity Contracts [Member] | ||
Derivative [Line Items] | ||
Deferred net losses, net of tax, included in AOCI | 287 | |
Cash Flow Hedging [Member] | Commodity Contracts [Member] | Long [Member] | ||
Derivative [Line Items] | ||
Open option contracts written, at fair value | $ 47,800 | |
Time period for open copper future contract purchases | 12 months | |
Fair value of future contracts with loss position | $ 117 | |
Fair Value Hedging [Member] | Commodity Contracts [Member] | Short [Member] | ||
Derivative [Line Items] | ||
Fair value of future contracts with loss position | (56) | |
Open future contracts to sell copper | $ 1,700 | |
Time period for open copper future contract sales | 4 months |
Financial Instruments - Summary
Financial Instruments - Summary of Location and Fair Value (Details) - Designated as Hedging Instrument [Member] - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Derivatives, Fair Value [Line Items] | ||
Total derivative assets | $ 304 | $ 1,009 |
Total derivative liabilities | (365) | (3,155) |
Other Current Assets [Member] | Commodity Contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Other current assets: Gain positions | 319 | 1,014 |
Other current assets: Loss positions | (15) | (5) |
Other Current Liabilities [Member] | Commodity Contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Other current liability: Gain positions | 75 | 55 |
Other current liability: Loss positions | $ (440) | $ (3,210) |
Financial Instruments - Effects
Financial Instruments - Effects of Derivative Instruments on Statements of Income (Details) - Cost of Goods Sold [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Commodity Contracts [Member] | Fair Value Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on the derivatives in designated and qualifying fair value hedges | $ 391 | $ 0 |
Commodity Contracts [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on commodity contracts (nonqualifying) | 6,126 | (1,095) |
Inventories [Member] | Fair Value Hedging [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) on the derivatives in designated and qualifying fair value hedges | $ (385) | $ 0 |
Financial Instruments - Amounts
Financial Instruments - Amounts Recognized in and Reclassified from AOCI (Details) - Cash Flow Hedging [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax | $ (770) | $ (445) |
(Gain) Loss Reclassified from AOCI (Effective Portion), Net of Tax | (292) | 501 |
Commodity Contracts [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax | (795) | (563) |
Commodity Contracts [Member] | Cost of Goods Sold [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Gain) Loss Reclassified from AOCI (Effective Portion), Net of Tax | (292) | 352 |
Interest Rate Swap [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax | 0 | |
Interest Rate Swap [Member] | Interest Expense [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Gain) Loss Reclassified from AOCI (Effective Portion), Net of Tax | 149 | |
Other [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
(Loss) Gain Recognized in AOCI (Effective Portion), Net of Tax | 25 | 118 |
(Gain) Loss Reclassified from AOCI (Effective Portion), Net of Tax | $ 0 | $ 0 |
Investment in Unconsolidated 40
Investment in Unconsolidated Affiliates - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 27 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | |||
Net loss | $ 18,331 | $ 2,487 | |
Tecumseh Products Holdings LLC [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Interest in the joint venture, ownership percentage | 50.00% | 50.00% | |
Net loss | $ 6,200 | ||
Second Unconsolidated Affiliate [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Interest in the joint venture, ownership percentage | 50.00% | 50.00% | |
Cayan Ventures and Bahrain Mumtalakat Holding Company [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Interest in the joint venture, ownership percentage | 40.00% | 40.00% | |
Net loss | $ 1,100 | ||
Cash invested to acquire joint venture interest | $ 4,500 | ||
Labor Claim [Member] | Tecumseh Products Holdings LLC [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Contingency charge | $ 3,000 |
Investment in Unconsolidated 41
Investment in Unconsolidated Affiliates - Summarized Financial Information Derived from Equity Method Investees' Consolidated Financial Statements (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 30, 2017 | |
Balance sheet data [Abstract] | |||
Current assets | $ 230,289 | $ 246,127 | |
Noncurrent assets | 128,200 | 139,200 | |
Current liabilities | 164,309 | 174,710 | |
Noncurrent liabilities | 61,183 | $ 58,334 | |
Income statement data [Abstract] | |||
Net sales | 124,100 | $ 126,300 | |
Gross profit | 12,100 | 15,600 | |
Net loss | $ (18,331) | $ (2,487) |
Benefit Plans (Details)
Benefit Plans (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Pension Benefits [Member] | ||
Components of net periodic benefit cost (income) [Abstract] | ||
Service cost | $ 24 | $ 35 |
Interest cost | 1,493 | 1,665 |
Expected return on plan assets | (2,289) | (2,182) |
Amortization of net loss (gain) | 349 | 556 |
Net periodic benefit (income) cost | (423) | 74 |
Other Benefits [Member] | ||
Components of net periodic benefit cost (income) [Abstract] | ||
Service cost | 60 | 56 |
Interest cost | 148 | 149 |
Amortization of prior service credit | (226) | (225) |
Amortization of net loss (gain) | 18 | (5) |
Net periodic benefit (income) cost | $ 0 | $ (25) |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Term of guarantees | 1 year |
Payments required to be made under guarantees, maximum | $ 8 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 29, 2018 | Dec. 30, 2017 | |
Income Tax Contingency [Line Items] | ||||
Effective tax rate | 18.00% | 27.00% | ||
Impact of investments in unconsolidated affiliates | $ 3.9 | $ 0.8 | ||
Provision for state income taxes, net of federal benefits | 1.2 | 0.9 | ||
Other items | 1.2 | |||
One-time transition tax liability | 12.9 | $ 12.9 | ||
Provisional tax benefit | $ 12.1 | $ 12.1 | ||
Reduction for U.S. production activities | 0.9 | |||
Effect of foreign adjustments | 1.4 | |||
Tax benefit of equity compensation deductions | $ 1.7 | |||
Forecast [Member] | Minimum [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Effective tax rate | 21.00% | |||
Forecast [Member] | Maximum [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Effective tax rate | 23.00% |
Accumulated Other Comprehensi45
Accumulated Other Comprehensive Income (Loss) - Changes by Component (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Changes in accumulated other comprehensive income [Roll Forward] | ||
Beginning balance | $ 536,028 | |
Total other comprehensive income, net | 3,063 | $ 5,564 |
Reclassification of stranded effects of the Act | 556 | |
Ending balance | 553,065 | |
Total [Member] | ||
Changes in accumulated other comprehensive income [Roll Forward] | ||
Beginning balance | (51,056) | (66,956) |
Other comprehensive income (loss) before reclassifications | 3,059 | 4,312 |
Amounts reclassified from AOCI | (173) | 603 |
Total other comprehensive income, net | 2,886 | 4,915 |
Reclassification of stranded effects of the Act | 556 | |
Ending balance | (47,614) | (62,041) |
Cumulative Translation Adjustment [Member] | ||
Changes in accumulated other comprehensive income [Roll Forward] | ||
Beginning balance | (38,163) | (49,965) |
Other comprehensive income (loss) before reclassifications | 4,800 | 6,561 |
Amounts reclassified from AOCI | 0 | 0 |
Total other comprehensive income, net | 4,800 | 6,561 |
Reclassification of stranded effects of the Act | 0 | |
Ending balance | (33,363) | (43,404) |
Unrealized (Loss) Gain on Derivatives [Member] | ||
Changes in accumulated other comprehensive income [Roll Forward] | ||
Beginning balance | 847 | (300) |
Other comprehensive income (loss) before reclassifications | (770) | (445) |
Amounts reclassified from AOCI | (292) | 501 |
Total other comprehensive income, net | (1,062) | 56 |
Reclassification of stranded effects of the Act | 112 | |
Ending balance | (103) | (244) |
Pension/OPEB Liability Adjustment [Member] | ||
Changes in accumulated other comprehensive income [Roll Forward] | ||
Beginning balance | (20,610) | (23,046) |
Other comprehensive income (loss) before reclassifications | (570) | (222) |
Amounts reclassified from AOCI | 119 | 262 |
Total other comprehensive income, net | (451) | 40 |
Reclassification of stranded effects of the Act | (1,018) | |
Ending balance | (22,079) | (23,006) |
Unrealized Gain (Loss) on Equity Securities [Member] | ||
Changes in accumulated other comprehensive income [Roll Forward] | ||
Beginning balance | 0 | 380 |
Other comprehensive income (loss) before reclassifications | 0 | 16 |
Amounts reclassified from AOCI | 0 | (160) |
Total other comprehensive income, net | 0 | (144) |
Reclassification of stranded effects of the Act | 0 | |
Ending balance | 0 | 236 |
Attributable to Unconsolidated Affiliates [Member] | ||
Changes in accumulated other comprehensive income [Roll Forward] | ||
Beginning balance | 6,870 | 5,975 |
Other comprehensive income (loss) before reclassifications | (401) | (1,598) |
Amounts reclassified from AOCI | 0 | 0 |
Total other comprehensive income, net | (401) | (1,598) |
Reclassification of stranded effects of the Act | 1,462 | |
Ending balance | $ 7,931 | $ 4,377 |
Accumulated Other Comprehensi46
Accumulated Other Comprehensive Income (Loss) - Reclassification Adjustments Out of AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Cost of goods sold | $ 545,670 | $ 488,427 | [1] |
Interest expense | 5,909 | 2,531 | [1] |
Income tax (benefit) expense | 7,395 | 11,929 | [1] |
Net income attributable to Mueller Industries, Inc. | (24,128) | (29,987) | [1] |
Other income, net | (560) | (594) | [1] |
Unrealized losses (gains) on derivatives [Member] | Amount Reclassified from AOCI [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Cost of goods sold | (365) | 422 | |
Interest expense | 0 | 232 | |
Income tax (benefit) expense | 73 | (153) | |
Net income attributable to Mueller Industries, Inc. | (292) | 501 | |
Amortization of net loss and prior service cost on employee benefit plans [Member] | Amount Reclassified from AOCI [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Income tax (benefit) expense | (22) | (64) | |
Net income attributable to Mueller Industries, Inc. | 119 | 262 | |
Other income, net | 141 | 326 | |
Sale of available-for-sale securities [Member] | Amount Reclassified from AOCI [Member] | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Income tax (benefit) expense | 0 | 94 | |
Net income attributable to Mueller Industries, Inc. | 0 | (160) | |
Other income, net | $ 0 | $ (254) | |
[1] | The Condensed Consolidated Statement of Income for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The components of net periodic benefit cost (income) other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Income. Refer to Note 1 for further discussion. |
Noncontrolling Interests (Detai
Noncontrolling Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | [1] | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | |||
Balance as of December 30, 2017 | $ 13,917 | ||
Net income attributable to noncontrolling interests | 216 | $ 468 | |
Other comprehensive income attributable to noncontrolling interests, net of tax: | |||
Foreign currency translation | 177 | ||
Balance as of March 31, 2018 | $ 14,310 | ||
[1] | The Condensed Consolidated Statement of Income for the quarter ended April 1, 2017 has been adjusted to reflect the adoption of ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The components of net periodic benefit cost (income) other than the service cost component are included in other income, net in the Condensed Consolidated Statements of Income. Refer to Note 1 for further discussion. |