Exhibit 19.1
To Our Stockholders, Customers, and Employees
Mueller's earnings and sales in the first quarter of 2004 reflected the
positive business trends which we recently noted in our Annual Report.
Net income for the first quarter was $18.0 million, or 49 cents per
diluted share, compared with $3.9 million, or 11 cents per diluted share for
the same quarter of 2003.
Net sales for the first quarter were $346.0 million, compared with net
sales of $232.0 million for the first quarter of 2003. This significant
improvement in sales was in part driven by the sharp increase in raw material
prices, particularly the price of copper. Shipments increased approximately 19
percent to 198 million pounds of product compared with 167 million pounds for
the same quarter last year. Margins expanded as we benefited from the
leverage of this incremental volume.
Operations improved during the quarter in virtually every product
category. Especially noteworthy was the improvement in margins in our copper
tube business. The Industrial Products Division also showed added strength.
And, B&K continued its excellent performance.
Mueller's financial position remains formidable. As sales increased,
and raw material prices escalated, we redeployed more of our cash to
inventory and accounts receivable. We were able to do so, readily.
Additionally, the Company declared and paid its first regular quarterly cash
dividend of ten cents per common share during the first quarter.
The business outlook for the rest of the year is promising. The
national economy is expanding, the housing industry appears headed for
another stellar year, capital spending is gaining momentum and both interest
rates and inflation are low.
Our Annual Stockholders' Meeting will be held at Mueller's headquarters
in Memphis, Tennessee on April 29, 2004. We hope you can attend, but if you
cannot, we urge you to sign and return your proxy card.
Sincerely,
/s/Harvey L. Karp
Harvey L. Karp
Chairman of the Board
/s/William D. O'Hagan
William D. O'Hagan
President and Chief Executive Officer
April 13, 2004
Statements in this release that are not strictly historical may be
"forward-looking" statements, which involve risks and uncertainties. These
include economic and currency conditions, continued availability of raw
materials, market demand, pricing, and competitive and technological factors,
among others, as set forth in the Company's SEC filings.
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MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
For the Quarter Ended
March 27, 2004 March 29, 2003
(Unaudited)
Net sales $ 345,959 $ 232,022
Cost of goods sold 281,029 191,915
Depreciation and amortization 9,965 9,740
Selling, general, and
administrative expense 26,682 23,296
Impairment charge 3,941 -
---------- ----------
Operating income 24,342 7,071
Nonoperating income, net 2,400 39
---------- ----------
Income from continuing operations
before income taxes 26,742 7,110
Income tax expense (8,782) (2,650)
---------- ----------
Income from continuing operations 17,960 4,460
Loss from discontinued
operations, net of tax - (539)
---------- ----------
Net income $ 17,960 $ 3,921
========== ==========
Basic earnings (loss) per share:
Weighted average shares
outstanding 34,658 34,257
========== ==========
From continuing operations $ 0.52 $ 0.13
From discontinued operations - (0.02)
---------- ----------
Basic earnings per share $ 0.52 $ 0.11
========== ==========
Diluted earnings (loss) per share:
Weighted average shares
outstanding plus assumed
conversions 36,908 36,771
========== ==========
From continuing operations $ 0.49 $ 0.12
From discontinued operations - (0.01)
---------- ----------
Diluted earnings per share $ 0.49 $ 0.11
========== ==========
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MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
March 27, 2004 December 27, 2003
(Unaudited)
Assets
Cash and cash equivalents $ 208,332 $ 255,088
Accounts receivable, net 233,641 163,006
Inventories 150,581 140,548
Other current assets 18,659 11,713
---------- ----------
Total current assets 611,213 570,355
Property, plant, and equipment, net 340,188 345,537
Other assets 134,191 139,292
---------- ----------
$ 1,085,592 $ 1,055,184
========== ==========
Liabilities and Stockholders' Equity
Current portion of long-term debt $ 1,960 $ 2,835
Accounts payable 55,519 42,081
Other current liabilities 63,626 68,590
---------- ----------
Total current liabilities 121,105 113,506
Long-term debt 11,386 11,437
Pension and postretirement liabilities 32,356 31,643
Environmental reserves 9,402 9,560
Deferred income taxes 65,149 63,734
Other noncurrent liabilities 11,221 10,238
---------- ----------
Total liabilities 250,619 240,118
Minority interest in subsidiaries 208 208
Stockholders' equity 834,765 814,858
---------- ----------
$ 1,085,592 $ 1,055,184
========== ==========
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