Exhibit 99.1
Mueller Industries, Inc. Reports Third Quarter Earnings
MEMPHIS, Tenn., Oct. 14 /PRNewswire-FirstCall/ --
Quarterly and Year-to-Date Earnings
Harvey L. Karp, Chairman of Mueller Industries, Inc. (NYSE: MLI), today
announced the Company's results for the third quarter and the nine months
ended September 27, 2003. For the third quarter ended September 27, 2003,
earnings per diluted share from continuing operations were 53 cents compared
with 70 cents for the third quarter of 2002. Income from continuing
operations for the third quarter was $19.7 million compared with $25.8 million
for the third quarter of fiscal 2002. Net sales for the three months ended
September 27, 2003, were $251.1 million compared with net sales of $227.3
million for the third quarter of 2002. The results include income tax
benefits that are discussed below.
Net sales in the first nine months of 2003 were $731.3 million compared
with sales of $736.9 million in the 2002 period. Year-to-date, income from
continuing operations was $33.2 million compared with $62.4 million for the
same period of 2002. Earnings per diluted share from continuing operations
were 89 cents for the first nine months of 2003 compared with $1.68 reported a
year ago.
Discussion of Income Taxes
During the third quarter of 2003, the Company recognized a deferred income
tax benefit related to a 1999 tax operating loss that resulted from the sale
of a subsidiary in that tax year. Without this deferred income tax benefit,
the Company's income from continuing operations would have been approximately
$10.4 million, or 28 cents per diluted share.
In the prior year third quarter, the Company sold the Utah Railway
Company. This transaction generated a capital gain for income tax purposes.
Without this capital gain and the income tax benefits related to the
transaction, the Company's income from continuing operations would have been
approximately $13.1 million, or 36 cents per diluted share.
Financial and Operating Highlights
Regarding the third quarter results, Mr. Karp said:
* "Gross profit increased to $49.1 million in the third quarter of 2003
which is the best performance in the last four quarters.
* "Mueller ended the quarter with $219.3 million of cash on hand. Our
cash position significantly exceeds our total debt of $15.2 million.
* "Our current ratio is nearly 5 to 1 and our working capital is $432.4
million.
* "We shipped approximately 175.0 million pounds of product versus 164.4
million pounds in the third quarter of 2002.
* "Our Standard Products Division posted operating earnings of $15.6
million, compared with $19.2 million in the third quarter of 2002.
Standard Products Division's net sales were $184.3 million for the
quarter, compared with $161.2 million for the same period a year ago.
Improvements over the preceding quarter are primarily due to copper
tube as volume and spreads have increased.
* "Mueller's Industrial Products Division posted operating earnings of
$2.9 million during the third quarter on sales of $70.1 million, which
compares with operating earnings of $4.6 million from sales of $67.9
million during the third quarter of 2002.
* "Our European operations continued to be profitable. Volumes are up
over last year as well as the first and second quarters of 2003."
Business Outlook
Discussing the business outlook, Mr. Karp said, "We are cautiously
optimistic that the fourth quarter will be one of improvement as the positive
trend of profit margins appears to be in place. Our long standing strategy of
being the low cost manufacturer means that we are well positioned to take
advantage of growth in demand and margins."
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, market demand, pricing, and
competitive and technological factors, among others, as set forth in the
Company's SEC filings.
Mueller Industries, Inc. is a leading manufacturer of copper tube and
fittings; brass and copper alloy rod, bar and shapes; aluminum and brass
forgings; aluminum and copper impact extrusions; plastic fittings and valves;
refrigeration valves and fittings; and fabricated tubular products. Mueller's
operations are located throughout the United States and in Canada, Mexico, and
Great Britain.
MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
For the Quarter For the Nine Months
Ended Ended
Sept. 27, Sept. 28, Sept. 27, Sept. 28,
2003 2002 2003 2002
(Unaudited) (Unaudited)
Net sales $251,053 $227,294 $731,296 $736,854
Cost of goods sold 201,960 176,302 597,336 569,459
Depreciation and
amortization 9,777 9,277 29,239 27,516
Selling, general, and
administrative expense 24,301 21,280 71,172 65,635
Operating income 15,015 20,435 33,549 74,244
Interest expense (267) (320) (870) (1,156)
Environmental expense (306) (483) (770) (888)
Other income, net 826 1,104 3,565 4,144
Income from continuing
operations
before income taxes 15,268 20,736 35,474 76,344
Income tax benefit
(expense) 4,469 5,086 (2,298) (13,941)
Income from continuing
operations 19,737 25,822 33,176 62,403
Loss from operation of
discontinued operations,
net of income taxes -- (313) (539) (493)
Gain on disposition of
discontinued operations,
net of income taxes 1,699 21,123 1,699 21,123
Net income $21,436 $46,632 $34,336 $83,033
Earnings (loss) per share:
Basic earnings (loss)
per share:
Weighted average
shares outstanding 34,267 34,269 34,260 33,905
From continuing
operations $0.58 $0.75 $0.97 $1.84
From discontinued
operations -- (0.01) (0.02) (0.01)
From gain on
disposition of
discontinued
operations 0.05 0.62 0.05 0.62
Basic earnings per
share $0.63 $1.36 $1.00 $2.45
Diluted earnings (loss)
per share:
Weighted average
shares outstanding
plus assumed
conversions 36,857 36,837 36,787 37,123
From continuing
operations $0.53 $0.70 $0.89 $1.68
From discontinued
operations -- -- (0.01) (0.01)
From gain on
disposition of
discontinued
operations 0.05 0.57 0.05 0.57
Diluted earnings
per share $0.58 $1.27 $0.93 $2.24
MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
September 27, December 28,
2003 2002
(Unaudited)
ASSETS
Cash and cash equivalents $219,280 $217,601
Accounts receivable, net 162,352 132,427
Inventories 145,433 142,953
Other current assets 11,131 7,366
Total current assets 538,196 500,347
Property, plant, and equipment,
net 349,007 352,469
Other assets 140,250 135,131
$1,027,453 $987,947
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current portion of long-term
debt $3,711 $4,161
Accounts payable 37,326 41,004
Other current liabilities 64,718 61,186
Total current liabilities 105,755 106,351
Long-term debt 11,486 14,005
Other noncurrent liabilities 116,416 113,647
Total liabilities 233,657 234,003
Minority interest in
subsidiaries 248 421
Stockholders' equity 793,548 753,523
$1,027,453 $987,947
MUELLER INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
For the Nine Months Ended
September 27, September 28,
2003 2002
(Unaudited)
Operating activities:
Net income from continuing operations $33,176 $62,403
Reconciliation of net income from
continuing operations to net cash provided
by operating activities:
Depreciation and amortization 29,239 27,516
Deferred income taxes (1,295) 10,870
Loss (gain) on disposal of
properties 349 (880)
Minority interest in
subsidiaries, net of dividend
paid (173) 66
Income tax benefit from exercise
of stock options -- 13,205
Changes in assets and
liabilities, net (27,195) (20,135)
Net cash provided by operating
activities 34,101 93,045
Investing activities:
Capital expenditures (24,100) (17,544)
Acquisition of businesses (10,806) (27,555)
Proceeds from sale of discontinued
operations -- 55,403
Other, net 1,799 3,691
Net cash (used in) provided by
investing activities (33,107) 13,995
Financing activities:
Repayments of long-term debt (2,969) (33,097)
Proceeds from the sale of treasury
stock 244 3,191
Acquisition of treasury stock -- (14,753)
Net cash used in financing activities (2,725) (44,659)
Effect of exchange rate changes on
cash 3,158 257
Increase in cash and cash equivalents 1,427 62,638
Cash provided by discontinued
operations 252 70
Cash and cash equivalents at the
beginning of the period 217,601 121,862
Cash and cash equivalents at the end
of the period $219,280 $184,570