Mueller Industries, Inc. (NYSE: MLI) announces results for the second quarter of 2023. Comparisons are to the second quarter of 2022, which, for context, yielded the highest quarterly earnings on record and a 70 percent increase in operating income over the same period in 2021.

• Operating Income of $210.7 million versus $268.9 million
• Net Income of $177.7 million versus $206.6 million
• Diluted EPS of $3.12 versus $3.65
• Net Sales of $897.0 million versus $1.15 billion

Second Quarter Financial and Operating Highlights:

• The decrease in net sales was primarily attributable to the normalization of demand across our three segments. In addition, lower COMEX copper prices, which were 11 percent below the second quarter of 2022, contributed to the decline.
• The change in metal prices, net of hedges, resulted in a $6.9 million increase in cost of goods sold in the current quarter as compared with an $8.0 million decrease in the prior year period.
• Operating costs were unfavorably stressed due to the impacts of several nonrecurring events:
  • As previously reported, our copper fitting manufacturing plant was damaged by a tornado on March 31, 2023 and remains shut down. While we rebuild the facility, we are producing some product in makeshift operations and sourcing the rest.
  • Our Brass Rod business was disrupted by a fire that resulted from work being performed by a third party contractor, thereby impairing production for nearly three weeks during the quarter.
  • Our Westermeyer business, which lost its manufacturing plant to a fire in August 2022, continues to operate at 80-85 percent of pre-fire levels in makeshift production operations. The business settled and recorded a $19.5 million gain from the insurance claim arising from the fire.
• Cash and short-term investments at quarter end were $898.4 million, an increase of $116.0 million during the quarter.
• Our current ratio increased to 5.4 to 1.

Regarding the quarter performance and outlook, Greg Christopher, Mueller’s CEO said, “Our team managed through some difficult issues and demonstrated its commitment to servicing customers, no matter the obstacles. Given the state of business and the unforeseen challenges we confronted, to have achieved these results is quite positive.

Decline in overall demand was as anticipated due to the easing of supply chain congestion and moderation of construction activity from its peak levels in 2022. Expenses were elevated due to inflation and the aforementioned disruptions, which absorbed considerable amounts of additional time and cost.

For the second half, we maintain our view that inflation and interest rates will remain at elevated levels and as such, will continue to exert pressure on the global economy. Demand and backlogs appear to have moderated to more normal levels, as supply chains have been sensibly rebalanced.

We will adjust as conditions dictate and are focused on investments that will optimize our manufacturing platform, reduce costs and improve profitability. We continue to generate strong cash flows, which provide us the necessary resources to act swiftly as growth opportunities present themselves.”

Mueller Industries, Inc. (NYSE: MLI) is an industrial corporation whose holdings manufacture vital goods for important markets such as air, water, oil and gas distribution; climate comfort; food preservation; energy transmission; medical; aerospace; and automotive. It includes a network of companies and brands throughout North America, Europe, Asia, and the Middle East.

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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 and energy, market demand, pricing, competitive and technological factors, and the availability of financing, among others, as set forth in the Company’s SEC filings. The words “outlook,” “estimate,” “project,” “intend,” “expect,” “believe,” “target,” “encourage,” “anticipate,” “appear,” and similar expressions are intended to identify forward-looking statements. The reader should not place undue reliance on forward-looking statements, which speak only as of the date of this report. The Company has no obligation to publicly update or revise any forward-looking statements to reflect events after the date of this report

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