MWA - Earnings call 1 2024 | Mueller Water Products, Inc.

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Operator

Welcome, and thank you for standing by. [Operator Instructions] Today's call is being recorded. If anyone has any objections, you may disconnect at this time.I would now like to turn the call over to Whit Kincaid. Thank you.

You may begin.

Whit Kincaid

everyone. morning, Good joining conference for Mueller Products Water Thank us quarter call. first you on we release Yesterday operations our issued afternoon, press quarter December for reporting ended XX, XXXX. the of results on the Officer. release morning of Martie Chief our Steve our Officer; Zakas, muellerwaterproducts.com.I'm and Chief copy A Financial by is available Officer joined our press this and Heinrichs, Executive website, Chief Legal

on will prepared questions related covered remarks, information we address the our Following the call. to

then question As webcast the return a and please a reminder, is live and Internet. to one This recorded and call to the morning's queue. follow-up keep being on

also to identifies and on statements materially It are statements made and these investors. release slide entirety. website.Slide in X today's results that forward-looking addresses and between could provide within important have included X we X financial our in non-GAAP Slide time, identifying on statements. and website forward-looking discussion. disclosure this why Slides believe non-GAAP included differ that on cause financial call. press review information to to information supplemental non-GAAP to requirements.At includes on This our Reconciliations this measures slides call. from referenced factors We accompany this posted the those release, and slides on our our in please information discloses press address GAAP cautionary forward-looking actual slide measures They Please their in our measures reasons This also the refer our X. useful

for the will XX the archived call available corresponding September. over replay During quarter, slides which to year at on turn to Investor now fiscal of unless of our or at webcast X-XXX-XXX-XXXX. this the specified A a ends refer call The all morning's our will specific be this for section call, otherwise, year, XX Relations least of be Martie. to days references website.I'll days XXth and available

Marietta Zakas

I'll year we start quarter expected call with for quarter everyone. the a the year of versus Thanks, decrease our first margins joining delivered a Thank performance.We net as morning, our overview expanded you the in to Whit. sales. brief today. despite earnings prior Good start solid

First we down sales and prior exceeded mainly from valves strong which elevated of in expectations as year, year-over-year sales, quarter for our the iron were lapped which announced the previously hydrants. net benefited high-end backlogs gate

Additionally, largely normalized the end we inventory were our believe of first that and channel levels customer quarter. by

municipal market challenging cybersecurity in recover to end from resilient and to tirelessly that end for impact October announced be mainly sales, there remains worked of We valve a appears specialty teams Our the stabilizing incident net associated the the XXXX.Our to some market timing products. XXXX. new a and relative construction residential with shipments operating to corporate small was believe

relating quarter costs incidents. to incurred first been the for we results adjusted Our have the

likewise to and who forward, reflected Going are SG&A investments further which supported teams make processes, our our I cybersecurity our who quickly to guidance.I grateful to incident. have made us in to and customers annual during aftermath grateful operations. tirelessly our we to the strengthen and business also the am return to am and our expect worked resources our of support customers helped vendors normal

service prior our XXX-basis-point and labor gross team's a first and improvement we the benefited gross along expand with the improved associated margin material costs. in and compared volumes the year.During to ability lower with lower supply incident freight driving cybersecurity and quarter, chain efficiencies and the led operational to customer on from challenges despite efficiencies focus with Our margins The reflects agility. execution

generated reflecting despite We in margins decrease XXXX from fiscal caused of operating cybersecurity from execution strong reflects inflationary resulting our prior also adjusted more benefited timing by the offset initial higher price sales incident.Our quarter, versus flow in forecasted payables from EBITDA a year. net first benefit and the delays the realization, once than again improved We our which some cash pressures. guidance

increased price operational improving the and year, elevated lower to expect relative new benefit our for infrastructure to to funding rates.Our am price headwinds the iron, beyond efficiencies, investments the from operations cover alloy. in though fiscal state-of-the-art sustainable specialty labor proud volumes volumes. and to teams our help ongoing that improve we resulting including of continue even expected which performance backlog, continue in hydrants.We improve remain large of majority lower specialty leads the from foundry, the which iron from I brass inflationary realization foundry benefit they operations to recently offset from pressures, and delivering Our than new, supply products, our face These and gross valves will anticipate products expectation from teams service on short-cycle benefits gas mainly commercial gross to equipment and prior our announced our will for products. gate are margins will federal and margin and a consolidated brass lapping to lead-free we focused higher operational XXXX. the sequentially as poised With chain gate continue the more that utilizes capital strategic increases valves

all we for to lead products. We normalized ramp our volumes continue new times brass up as return brass at our to of service look foundry to

by remains the to environment target external steam full considering calendar especially end Israel-Hamas running uncertain, XXXX.The of continue have war. We the to it ongoing

our As for due a less which repair sales. than of a consolidated Israel our repair our quarter material operations our strategic impact have products did accounts Krausz not inventory products. our Krausz level reminder, goods we This for have on through business, of results XX% to finished in first

in higher we to made margins our starting include normalized quarter.We XXXX war headwind incremental to chain freight fiscal our will manufacturing to investments production return expect and help from to levels These see in as costs the production up. costs second labor have Krausz a we meet and These resulting demand. However, at customer operational investments levels. supply to be ensure ramp

impacts pleased with remarkable the our and will the to a evolves.Overall, war, our during to the our we has very am business Israel situation of considering adapting the them teams job start continue support headwinds to as I year, quarter. in especially the faced and the team Our done

on our We improve lower overall a volumes. gross expected consecutive track for despite margin to second year are

turn the sales strengthen a Steve. look operational and is past more testament over made performance consistent growth.With drive to we future customer and Our we've that, deliver improvements to to further service to as investments over execution the and margin I'll it year our

Steven Heinrichs

morning, Martie, and Thanks, good everyone.

sales with quarter, net the compared were For $XXX.X prior our year. a the of XX.X% consolidated decrease million,

performance at benefited of manufacturing million prior and and of freight gross year X.X% prior Water higher prior and Management the quarter, backlog the reminder, our in XXX volumes. year. expenses personnel-related valve the the consolidated approximately to over higher quarterly pricing, XX.X% points Benefits Flow charges net Adjusted lower was In lower of incentive with more and $X.X $XX.X which margin expenses quarter, and of which iron reflects the includes lower This prior reduced cybersecurity a Solutions line $XX.X Although the expenses decreased strategic higher favorable decreased primarily with margin adjusted backlog. The by foreign $XX.X unfavorable incidents, million of have both sales Water results to manufacturing and than top were the million material from This we efficiencies.For from products income amount in offset The for in were million $XX.X decreased Gross the total our non-GAAP our XX% the income exceeded associated than year. and $X.X driven which than volumes in prior most the elevated guidance, year. SG&A decreased due compared the with lower million an by referenced X earlier. quarter offset pricing partially increased serving across Solutions, by labor, sales of Operating inflationary lines.As performance quarter expected our year, prior first partially than expense.Operating X% product benefit primarily includes lower versus SG&A prior includes more and been Martie operating hydrant $X gate down the pressures benefits prior profit decrease end improved decrease year. for This of at results. XX.X% compared excluded with income the and volumes. and more third-party quarter, the with quarter recoveries.Turning improved was these now nonrecurring million the the compared from exchange fees, years. offset reorganization Compared the in were by with year highest quarter. includes gross basis costs compared pricing other of insurance from million offset year.

year margin prior XXX XXX Our points lower Despite adjusted in margin increased the volumes.Adjusted million despite lower of quarter. improved improved compared points the $XX.X EBITDA basis X.X% our volumes, XX.X% the to adjusted XX.X%. EBITDA to the with expected basis operating

This For was rate quarter, compared income.For expiration indemnification that year. year, last on quarter $X.X effective of quarter the tax XX.X% the the tax expired of adjusted net million $XXX,XXX XX XX-month $X.X in XXX-basis-point $X.X tax benefit or primarily uncertain was the the lower benefit XXXX. income million December XX.X% as a million primarily compared months, improvement a of expense of interest The with for XX.X% expense. million with prior a due income tax the tax Net position $XXX.X was with by for period. a the in receivable declined to with compared our sales, other interest higher the EBITDA prior the release result XX, was rate to prior associated offset an as

XX.X% For most valves segment's normalized the iron the from valves were primarily million from backlog serving an lines. with net a primarily flat with by for decreased offset elevated valves, than sales backlog. favorable hydrants year.Turning also due manufacturing with serving margin primarily year lower sales quarterly improved with and EBITDA quarterly volumes. volumes, Solutions. lower SG&A double XXX net of times, with of due lead prior million gate reminder, to year, operating volumes. XX.X% $XX.X benefited compared XX% XX.X% times.As which, year, sales, segment incident.Despite the compared mainly Specialty Lower double benefited sales for than $XXX.X volumes, benefits operating were adjusted digits and performance points the Flow valve prior water an pricing, Water had prior for from of quarter decreased higher and more of EBITDA in compared results the of down decreased in increased the partially to the related million performance income the year lead normalized $XX.X million more XX%.Turning Solutions. the down compared XX%, million SG&A manufacturing EBITDA digits quarter, Net Benefits lines. and applications, the from due of Management million expenses were Water and $XXX.X Lower iron $X.XX starting $XX.X higher by Net offset Adjusted also with prior which the prior the basis a prior specialty pricing prior favorable offset to income compared share performance, reminder, the were Adjusted compared per by to lower down was year, across were lower digits the pricing, iron to mainly cybersecurity had gate Net to hydrants challenges, were of decreased quarter.Adjusted gate quarter, and XX.X%. lower by of quarter. the as most the delays with now of higher sales adjusted offset for $XX.X segment's disruptions caused elevated double mainly income year. Net in higher partially product expenses in year. to across in pricing prior product were sales adjusted diluted production increased

to in However, prior cash receivables points XX.X%.Moving caused compared to operating collections year. activities Net flow. $XX.X cybersecurity working This by delays a increase with in by of million, increase adjusted the an EBITDA margin with an cash improved in on This the XXX prior quarter provided was for the basis million increase largely inventories, primarily the improvements related to payables, and capital to higher smaller year. was incident. due compared included $XX.X

increase in brass foundry $X.X we prior in million expenditures, in the the was lower on the quarter second expect of cybersecurity million $X.X quarter, those prior primarily year from benefits processes delays have the reverse the decrease quarter. related due as to capital than which invested normalized.During the spending to incident. payables timing new is the to the some short-term year our The in and We

prior the total cash $XX.X million, of increased quarter the and $XXX.X compared driven from year, operations spending.At million for equivalents our the $XX.X of we lower flow first million end quarter, cash debt $XXX.X outstanding free to the and by Our with and cash was cash million. higher capital had

ratio end. leverage quarter X.Xx at Our net debt was

As financing fiscal we a not our borrow our XXXX. reminder, maturities XXXX. nor did ABL agreement we ABL currently have have any did the our We borrowings June any now during end no for at quarter.I under will amounts outlook before under debt review quarter

We slightly consolidated net takes first and recent expectations sales. prior X% now actions. in net are performance fiscal to year. pricing with anticipate improving We XXXX as quarter compared our between for decrease our This the and sales into account X%

addition elevated initial updating to Despite providing and are reminder, headwinds gate X% forecasted X% hydrants, volume a we volumes, fiscal prior short-cycle XX% guidance decreased anticipate fiscal that increase to mainly nearly XXXX the XXXX.In sales lower As valves lapping EBITDA between which now growth related net compared by the our backlog, iron still will and for expect year-over-year we year. adjusted our EBITDA. expectations, for with we adjusted in

fiscal our as we cash it I'll Additionally, fiscal closing compared income back in expect with Martie flow XX% more XXXX.With for of XXXX for turn adjusted to a to that, net comments. percentage as be than XX.X% free

Marietta Zakas

helping on faced, hundreds operations value want the I to today are remain safe opening to Q&A. of Mueller role chain. and plays items focused customers We our wouldn't people. critical few Thanks, also Despite have it our we we supply millions Steve. for drinking highlight be dedicated in key a to a further water customers challenges clean, our where delivering and while in deliver of we team our driving customers before without members, suppliers. efficiencies external up

the been over water of ramp for has up to end the partner utilities steam of a century. We XXXX.Mueller for brass running committed full foundry having continue goal and meeting to it new are by calendar a trusted our

in Our to to infrastructure poised benefit addressing a water and investment play us increased broad facing water role critical portfolio challenges end water solutions addressing aging allows the is municipal The of products opportunities and towards from the infrastructure. industry. and attention the market

funds start and once with us solutions improvements year, the and infrastructure large benefit bill capital begin products, from solid operational at flow.With inflection the point our to Our position we to to investments an projects deliver execute position are a the call concludes will expand are margins. improvements.That taking growth am open Operator, actions long-term and I that organic sustainable will that my comments. margin we strategy for confident please to our us to this questions. strategic

Operator

Capital first Instructions] RBC Our question Markets. [Operator Dray comes Deane from with

Deane Dray

That's do for are the a start does more year. mean to expectation you give So love get some year? and you there. strong certification there, foundry Martie, the running process. fiscal happening? many was the you what this the mentioned new sense ramp-up us that had now I'd nicely. How shifts And outsourcing details that your to through a to progressing while

Marietta Zakas

Yes.

are new we brass we respect we looking where seeing think that at to with I continued pleased were with foundry, the are of ramp-up there. overall, So terms in the

want the just continuing I to now. the continuing production facility meet brass with we couple for the backlog we a to we to to with that do we to service with -- we have down We point and of brass improvements foundry. a the respect want with new running of part customer the bring that are that demand.But the make continue to shifts that quick are we old run have continue products in we're right as importantly, that that to have foundry, hit reason reminder, think the that I And is have the -- level.

iron that the need capital valves still capacity foundry.We'll respect this but expenditures supplying brass our our old complete that our service some calendar remind brass not We our it as will new we as a well. to to supplies equipment, foundry pouring additional old end as year to with our by as greater for only as well we of expect part XXXX. efficiencies have the old fire as higher will up our well foundry said, is also ramped gate And than we The you than have hydrants. fully of components foundry well of have it source the as products, the

of do. part about we've this, to talked will we've we outsourcing outsourcing I of continuing as need done. know are as to that that us ramp So foundry, to we it the allow And reduce some up that also the

Deane Dray

a -- it reduction versus of outsourcing kind maybe last that Has year? is started? Just percent

Marietta Zakas

Yes.

I'd we yes, So the is the range is the over improvement. the in the to to let's of absolutely, gross seen somewhere, outsourcing that outsourcing contributing It's of XX%. And say, probably say down. coming down one XX% benefits margin have

Deane Dray

right. stabilizing, interesting with All larger development to glad I'm to you and looks what and was the seeing size the consistent some question, housing you're And were we're That's and good news. there. really these really projects us. it hear that more supply neighborhood about exposed overall, pretty to second able good of on for business that's resi

So to stands, seeing you're in kind the of where size for those you the that the timing us is extent that that what terms today? development can properties of of

Marietta Zakas

land muni which XXXX market contributed challenging we've in was guidance the well, overall, year fairly residential certainly rates think in have that. for given, is interest mortgage reflecting No rates, question, been the consequentially, increase a look, So we development. the market that the resilient. And as has well the and to that as construction as

talk headwind a been quarters. the months.We of down couple starts where X% We last as after think are the of housing do looking their as all little they may we bit well.Certainly, do and overall, certainly could funding homebuilders in well, we say, we permitting seeing you as the opposed they some activity some we I XX U.S., could interest higher would certainly, to we the think land starts that factor start to interest consider about. you in I XXXX, as are are we well normalization XXXX, we stronger the equal, for certainly development, regions think construction to be ultimately some of But a as the but as But some go the as face beyond there look we rates little where last of think But over resi look the challenging be a be a lots we headwinds influencing at improvements as us, not single-family So XXXX. have challenges will developed benefiting as construction more as will from some others. higher rates could still residential an at that see across bit as lingering also as look there, saw looking on about inventories think think see the housing continuing that.

Deane Dray

comment. the flow a shout Steve cash it's And out quarter. team. free to generation I a just fabulous That not Terrific. this was question, and

Steven Heinrichs

Thank you.

Operator

with Our next question comes from Mike Baird. Halloran

Unknown Analyst

You like back of to how versus about margin you expectations back positive Can ] a have how that trending you about go in And November. quarter. it want [ Obviously, unchanged, and the the versus talked thinking about of I a but expectations? talk outsourced bit foundry we timing talked the quarter feels maybe I tracking healthy being reduction that's in know to about surprise? surprise much a on maybe you're in the how maybe outperformance brass much little maybe in outsource Mike. brass. Paz was for the

Marietta Zakas

Yes.

terms can surprised looking So where use of that. let are. I say, if at would we think hit see I I wouldn't in the I word me overall

have time, done, bring have outsourcing are performance, our we supply that. back to broadly, our we've say been identified effective us, I'll teams less even think we've that certainly, can -- volumes have we as that think which bring couple the the that as improvements which as contributed were certainly look had, other just disruptions the had I And supply as we to manufacturing over overall, that the as in certainly respect improving than we've helped in-house, as last years. over chain we think, we the the execution piece, the margin side well that we the some as But we I in the though has performance. know it's make on there benefits with improvements, seen think to chain that we the has allowed of said, sourcing and in areas I have we from certainly, well.I looking back lower overall, the at of

that to have improvements continued helped. also efficiencies and see We there have

So we've respect, performance largely say, Certainly, I'd it's chain with the few supply say, team particularly a our achievements seen. due improvements been inflation, we've well I as it's from higher would had that side. our the we've particularly labor on to with things I team. But say would operations as had

Steven Heinrichs

improvement team And we forward. done really main is continue costs that. that gross the margin improvement, managing and job think we great going reasons supply that outsourcing and of to do chain reducing And in our has the the a for that of one expect

Unknown Analyst

handed gears here. time manage you And you is what the getting balance on shape. foundry how how for helpful. Got and at That's you the this about switching transition bandwidth obviously, acquisition how talk about Maybe current for capacity do M&A maybe the to Can pipeline? management free highlight M&A, I'm are integration? touch for healthy heavy you the the And In is the much having have state point? this pipeline you at sheet Can you point? think of it. really, at in deck,

Marietta Zakas

Yes.

would say, deepen overall, start our the and years sheet balance look, and/or and opportunities capacity or So -- product with look we run the specifically water within M&A let I and/or there. lines, where for over related talked to or me our about the we've industries. gas, continuing certainly can and

hand, with additional have well resulting years a we agreement. as liquidity ago overall that asset-based as capital lending talk we capacity. the from certainly, about our established the think certainly flexibility number as not I cash us as only gives the have, on that structure we We have capacity but well that that of we

that we So perspective, continue and believe opportunities to we we continue well value-enhancing think we perspective, are the be management from I think going from opportunities the to positioned.I right delivering that does capacity ultimately, are the for then a would that perspective, -- I to very M&A say, would looking and opportunities. for in have we management when those our shareholders. bandwidth them in -- delivering from and find the on And look team interest a for, those

Unknown Executive

I I'll on. appreciate it. pass it

Operator

comes Our Giordano next question with from Cowen. Joe TD

Unknown Analyst

] [ is Joe for Giordano. This Zheng on

to touch you're wanted for -- what relatively the what you've and expecting mentioned high you base you looks Just And on for at normalize? price continuing that seeing compare been is inflation recently? differential benefits it seeing Or like? levels? for Could stayed against XXXX. Has what inflation to it you're

Steven Heinrichs

stable So range, realization this a been which low with our the majority rates. pleased our normalized from and our of price normalized normalized. relationships.We as with of inflationary at for done. environment customer average inflationary we typically there's team coming have for our in point, and seasonality this more the single-digit spring products as more pricing a strength realization environment, the this our year has higher have reflects business of this labor year, lead we're price times pressures most inflationary price the think we in commercial Historically, increases And we expect in announce

on reminder, increases realization typically for price expect to some the iron, includes products more and range. prior majority rates. expect our we our be XXXX inflationary year of a to our as price our mid-single-digit announced continue higher in specialty the price carryover low to gas realization we And cover periods. from And than the pricing labor So had recently our ongoing including will this pressures, and

Unknown Analyst

capital a about you're the is towards about sequential you And and And you talk normalized more a to across helpful. the towards cash half? flow? your separate on That more them was thinking very expected Are back ramping Could free question spend -- when just down year? the projects. it be moving

Marietta Zakas

to So correctly. to it of heard sure to wanted capital I make just of be rate we heard I want year. just you make expenditures want question, we've first clear, sure sort to it talk I about the want -- through correctly, I the your

Unknown Analyst

correct. Yes, that's Yes.

Marietta Zakas

Okay.

Okay. Very good.

foundry for all, of first full at think, million. as guidance comments, million we brass lighter had to in $XX first year expenditures that the some I certainly our the comparative our quarter. light think were it And I So expenditures, to in last quarter, the first overall, is relative year. is shared of We of capital we $XX in opening some looking the

We also did experience were incident.That million cybersecurity delays still to range. probably to guidance some we're the million said, our that $XX for related the looking in $XX short-term

of have expenditures. been higher capital at in large capital It talked X and of been level overall is about a because projects have We has the level years, underway. recent that that

line with we the are finish in those we terms to being said, As of closing expenditures the lap our foundry. brass

expenditures capital Our than X% will sales. net forward that of less are expectations going be

the have for foundries to our hydrants continue we well percent I net sales integrated expenditure will a levels X large because certainly remind brass We will see vertically we melting business. or valves as manufacturing large, to by products. our decline.That that valves or expect as are, do and iron do of we a for are the said, as our that So service our you iron we

level And so certainly, manufacturing a maintenance will and of need a being to we always have the of expenditures make vertically integrated. as certain we processes result that

Steven Heinrichs

heard delays we're as to as capital mostly we processes second obviously a collections and period. improvement it's than due quarter have really that incident, you cash, with operating the Yes. This obviously quarter higher in our systems from and first in payables it here benefits a payables.As And reminder smaller our improvements prepared was strong remarks, working our prior cash was affected normalized. a pleased our in increase our which management, there to relates inventories, just those flow, now payable receivables expect quarter some in cybersecurity as the by and significantly in increase reverse in caused result systems, higher the first to of benefit a an of

continuing that to cash that, going So we're and performance, forward strong look forward. with pleased the I

Unknown Analyst

Great. That was helpful.

Operator

Seaport next from [Operator Walt with comes Instructions] Liptak Our question Research.

Walter Liptak

And Deane's by to you've wanted that ask heard want right? parallel I to that a that outsourcing. -- think XX% this sort question follow-up of sure to cost XX%. reduced make Is about the the outsourcing, I I I you said to right

Marietta Zakas

outsourcing contributing probably, for maybe which with are we I to -- we we've -- and around last this of the think it's about certainly as I have again to -- I improvements. it, that reasons to have the look let's say, the talked margin about margin think XX% talking as But seen, that, I said is think, quarter, expenditures, XX%. reduce we one been improvement to our we quarter, able XX%

Walter Liptak

And -- are like it XX%. the like and some Okay. with down of sounds backlogs

past wind of these gotten quarter? we come next Or through you've Do for year-end that due see we outsourcing wait So do until out down? costs to most that of backlog. more

Marietta Zakas

So comment first of -- you that or all, I'll you've in that take an backlog. made and question around important

supply are essentially and have are working as And first to we do short-cycle our as backlog at well.The of I meaningful to through gate in hydrants reduced work in as somewhat in that backlog to gate we those are brass we hydrants, improving our So are did look been our the we know has cost get that with our question commented improvement that or meaningful foundry quarter chain valves service you're level our at with and valve, and of think sort to service And in generally our say, we of contributing can well iron make continue team, that that lead our brass typically short-cycle have times, the that forward. and point. We've still balance products. as asking products much work fire first products. think levels the XXXX. to would higher-than-normal had. a We respect the this to we moving that look new one and more backlog we we iron normalized And I we elevated pretty the we really we higher around levels when corollary fire at production when the the products, to factors a for reduce the cost. backlogs back calls, the those there, normal disruptions our of we that our the see X outsourcing some past improvements we I supply have. our continuing outsourcing our chain, continue have quarter, are and costs at and levels in brass levels to on at importantly, less seen the it's to eliminated the improvements backlog, the we backlog of We see have look as short-cycle with a

Walter Liptak

now reduction done Okay. That actions benefits full we to -- up couple that are just good. with last quarters. Where And SG&A I of back seeing we the you sounds been the are on cost to SG&A from cost -- wanted the the going for taken? that's cuts?

Steven Heinrichs

Yes.

and -- question. During good

customers. in our to our includes business support other chunk sales in close teams of to roles. that big corporate, to streamline million During are savings previously XXXX. a marketing streamline last of function the we actions we and of G&A our which third organization achieve our we SG&A quarter including as And restructured areas those year, to took the highlighted $XX tracking bring and our you some organization achieved expenses, We know, the and other additional of

As be X%. see SG&A a going of in reminder, And in probably around range the we to forward. do going inflation it's

start prior So periods, when compare please SG&A. inflation realize you that is there to in

Walter Liptak

Okay.

us search is of there And Or the just have tell still up? leadership Okay. on? wrapped anything any things transition. can the then one last Is you on timing that going

Marietta Zakas

yes. So

any updates time. So we share have at this to not do

is refreshment piece Board on as process. CEO search well Our the the both as focused Board

retained executive and external they are line search time internal said, firm. but a both considering not announced have for they they an have candidates, They process. As this

Operator

Our comes last with question Oppenheimer. from Blair Bryan

Bryan Blair

To for drill bit. down price-cost trends, a been favorable more it's little on a

from in is there. willing as momentum out parse fiscal price-cost what now? contemplated have Are XQ to the You and you guidance impact directly of

Marietta Zakas

on me question. Yes, hit try to let your

So let price me on first. talk

cycle the just that over have back have through on and goes think, we gotten lived think I I this, the of other side. some And

to certainly to respect a few that And But we a going a the objective years series recover, was to the are that. pricing and chain back side think, normalized we upside the other inflationary the give we think we talked in that implemented context. that to I'm I the now, if experiencing.I for -- covering as are throughout down and stated 'XX inflationary levels we the experienced, I disruptions, we more in of inflationary period, With a of time inflationary price and of while, you going all environment. now know 'XX, than increases. the on largely with that of costs, then will, more and sort extraordinary a pricing inflation you for while, costs, supply were, starting get the have that continue ultimately costs of I'm price, we the and

-- of So inflation we But beyond in seeing we sort put inflationary that ahead respect with inflation, going a that we point, this price to that point, our we experienced. are as with perspective, think are did gas inflation look -- that more announce we as that at From factor iron, We probably cover and look we specialty we we on. more in margins. and with an forecasting we're a than what what products. we have could for increase the we're that most pricing at see could respect stability costs at the just this importantly, the to we as preserve will feel environment, labor

Steven Heinrichs

mortgages and in we EBITDA our manufacturing guidance, that's referred and guiding offset vis-a-vis performance the also And is the sales demonstrated to and expect volumes been Yes. lower that that to. pricing do improved we're inflation

you. to helpful that's hopefully, So

Bryan Blair

Yes. the I color. appreciate

to mapping that catalyst you been catalyst fiscal Echologics expected identifiable, that your extent, Has spending there for a over that do that's front-end which of and I out spending, beyond, called be ramp IIJA likely areas with to understood. sticks work out condition should what to LSL of intensifies? in the are and with assessment work a few There but the help you've some as can business. are you time, that and me are is 'XX that where pipe planning. suspect for work Echologics that's is to follow-up, areas a As kind some to participating And front-end date? Or

Marietta Zakas

-- our for a beneficial we on that look, receive I provisions sort tell sometimes the don't the the as be but is expect these seen dollars have near-term we positive say, put lead the as process catalyst have generally it certainly the to expect to Rule the government through that would said, you we Yes. very for to And haven't don't service products to include only the us, the conjunction are line that impact of the others needed lead service Lead HUD don't be and you any to And around focus on to they that going what through and not Echologics. various devil on met the to line with the certainly, of meaningful that highlight from the I that in the look, love in is will that infrastructure. we the can't that agencies, administration are to certainly service governmental And can this and currently, is just we -- overall, one just Echologics, given we long put 'XX. I bill really say, with XXXX. I that infrastructure sell, seeing, that let's be think that we replacement. think is feel the respect work items. which DOT, fiscal we has the EPA, see the include, infrastructure products, impact be specification funding.So see just Copper then from can with brass in in focus the -- bill projects water specifically we much we're is to will But just allocated see bill part We -- details appreciating term. the the going of you what replacement

Steven Heinrichs

Yes.

As calendar that really $XX was are inventory complete fiscal at program. -- And municipalities part of at XXXX the bill, this -- the the required 'XX. of billion the due at that our is start to end infrastructure nearly the deployed of to well, the

those benefits replaced. start lines coming start will those So when in getting

Marietta Zakas

Yes.

replacement, line lead in In the billion was areas fact, it's that $XX actually service $XX I water and think of billion, other infrastructure.

Steven Heinrichs

you $XX know, going That's billion apologize. always correct. industry is I good. the And as into

Operator

no And we this at have further questions. time,

Marietta Zakas

Very good. all for again us you look, Well, today. joining thank

exceptional navigate and of at really I uncertainty are control.Mueller's point. in that and outside deal in very of the it's some the there overcoming external first environment, our members confident we the recent am year, quarter, to inflection challenges, but does pleased While are team done work we early remain our with our equipped better of have any great external an a

operational have We made to meaningful improvements date. investments and strategic

capabilities as increased the positioned, the well benefit are from address the we to to accelerating their water tailwinds help We municipalities have infrastructure, for discussed, investment challenges. and in just we the

suppliers employees.We to path a interest the on margins, operational your improving Operator, performance for our our we and we increasing you that have in with conclude thank can Mueller. are call. customers, position We continue that, our continued and with the enhancing

Operator

for you participating. Thank conference. today's concludes That you. Thank

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Mueller Water Products (MWA) 9 Feb 242024 Q1 Earnings call transcript