SPRINGFIELD, Mo., July 26, 2024 (GLOBE NEWSWIRE) -- Paul Mueller Company (OTC Pink: MUEL) (the "Company") announces its second-quarter earnings of 2024.
| PAUL MUELLER COMPANY | |||||||||||||||||||||||||
| SIX-MONTH REPORT | |||||||||||||||||||||||||
| Unaudited | |||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | Twelve Months Ended | |||||||||||||||||||||||
| June 30 | June 30 | June 30 | |||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
| Net Sales | $ | 65,670 | $ | 59,931 | $ | 116,026 | $ | 116,282 | $ | 228,900 | $ | 221,050 | |||||||||||||
| Cost of Sales | 45,871 | 41,379 | 80,431 | 80,933 | 158,123 | 165,816 | |||||||||||||||||||
| Gross Profit | $ | 19,799 | $ | 18,552 | $ | 35,595 | $ | 35,349 | $ | 70,777 | $ | 55,234 | |||||||||||||
| Selling, General and Administrative Expense | 11,417 | 12,714 | 21,775 | 25,301 | 84,743 | 39,675 | |||||||||||||||||||
| Operating Income (Loss) | $ | 8,382 | $ | 5,838 | $ | 13,820 | $ | 10,048 | $ | (13,966 | ) | $ | 15,559 | ||||||||||||
| Interest Income (Expense) | 70 | (80 | ) | (1,178 | ) | (177 | ) | (1,351 | ) | (369 | ) | ||||||||||||||
| Other Income | 506 | 613 | 2,050 | 1,333 | 3,383 | 2,310 | |||||||||||||||||||
| Income (Loss) before Provision (Benefit) for Income Taxes | $ | 8,958 | $ | 6,371 | $ | 14,692 | $ | 11,204 | $ | (11,934 | ) | $ | 17,500 | ||||||||||||
| Provision (Benefit) for Income Taxes | 2,154 | 1,558 | 3,439 | 2,724 | (4,817 | ) | 4,140 | ||||||||||||||||||
| Net Income (Loss) | $ | 6,804 | $ | 4,813 | $ | 11,253 | $ | 8,480 | $ | (7,117 | ) | $ | 13,360 | ||||||||||||
| Earnings (Loss) per Common Share -- | Basic and Diluted | $7.26 | $4.43 | $11.13 | $7.81 | ($6.79 | ) | $12.31 | |||||||||||||||||
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||
| Six Months Ended | |||||||
| June 30 | |||||||
| 2024 | 2023 | ||||||
| Net Income | $ | 11,253 | $ | 8,480 | |||
| Other Comprehensive Income (Loss), Net of Tax: | |||||||
| Foreign Currency Translation Adjustment | (780 | ) | 441 | ||||
| Comprehensive Income | $ | 10,473 | $ | 8,921 | |||
| CONSOLIDATED BALANCE SHEETS | |||||||
| June 30 | December 31 | ||||||
| 2024 | 2023 | ||||||
| Cash and Short-Term Investments | $ | 3,409 | $ | 1,883 | |||
| Marketable Securities | 18,169 | 32,042 | |||||
| Accounts Receivable | 35,662 | 25,166 | |||||
| Reserve for Doubtful Accounts | (1,141 | ) | |||||
| Inventories (FIFO) | 44,379 | 45,910 | |||||
| LIFO Reserve | (21,310 | ) | (21,774 | ) | |||
| Inventories (LIFO) | 23,069 | 24,136 | |||||
| Current Net Investments in Sales-Type Leases | 29 | 27 | |||||
| Other Current Assets | 5,920 | 3,537 | |||||
| Current Assets | $ | 85,117 | $ | 86,791 | |||
| Net Property, Plant, and Equipment | 44,253 | 42,011 | |||||
| Right of Use Assets | 2,280 | 2,421 | |||||
| Other Assets | 2,823 | 2,590 | |||||
| Long-Term Net Investments in Sales-Type Leases | - | 456 | |||||
| Total Assets | $ | 134,473 | $ | 134,269 | |||
| Accounts Payable | $ | 15,284 | $ | 11,041 | |||
| Current Maturities and Short-Term Debt | 631 | 640 | |||||
| Current Lease Liabilities | 350 | 402 | |||||
| Advance Billings | 18,865 | 27,383 | |||||
| Pension Liabilities | 32 | 32 | |||||
| Other Current Liabilities | 26,520 | 19,599 | |||||
| Current Liabilities | $ | 61,682 | $ | 59,097 | |||
| Long-Term Debt | 8,407 | 8,880 | |||||
| Long-Term Pension Liabilities | 217 | 233 | |||||
| Other Long-Term Liabilities | 1,696 | 1,768 | |||||
| Lease Liabilities | 777 | 775 | |||||
| Total Liabilities | $ | 72,779 | $ | 70,753 | |||
| Shareholders' Investment | 61,694 | 63,516 | |||||
| Total Liabilities and Shareholders' Investment | $ | 134,473 | $ | 134,269 | |||
| SELECTED FINANCIAL DATA | |||||||
| June 30 | December 31 | ||||||
| 2024 | 2023 | ||||||
| Book Value per Common Share | $ | 65.85 | $ | 58.50 | |||
| Total Shares Outstanding | 936,837 | 1,085,711 | |||||
| Backlog | $ | 187,336 | $ | 97,350 | |||
| CONSOLIDATED STATEMENT OF SHAREHOLDERS' INVESTMENT | ||||||||||||||||||||||||
| Common Stock | Paid-in Surplus | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||
| Balance, December 31, 2023 | $ | 1,508 | $ | 9,708 | $ | 67,181 | $ | (10,787 | ) | $ | (4,094 | ) | $ | 63,516 | ||||||||||
| Add (Deduct): | ||||||||||||||||||||||||
| Net Income | 11,253 | 11,253 | ||||||||||||||||||||||
| Other Comprehensive Income, Net of Tax | (780 | ) | (780 | ) | ||||||||||||||||||||
| Dividends, $.30 per Common Share | (378 | ) | (378 | ) | ||||||||||||||||||||
| Treasury Stock Acquisition | (11,910 | ) | (11,910 | ) | ||||||||||||||||||||
| Other | (7 | ) | (7 | ) | ||||||||||||||||||||
| Balance, June 30, 2024 | $ | 1,508 | $ | 9,708 | $ | 78,049 | $ | (22,697 | ) | $ | (4,874 | ) | $ | 61,694 | ||||||||||
| CONSOLIDATED STATEMENT OF CASH FLOWS | |||||||
| Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | ||||||
| Operating Activities: | |||||||
| Net Income | $ | 11,253 | $ | 8,480 | |||
| Adjustment to Reconcile Net Income to Net Cash Provided by Operating Activities: | |||||||
| Pension Contributions (Greater) Less than Expense | (16 | ) | (818 | ) | |||
| Bad Debt (Recovery) Expense | - | (19 | ) | ||||
| Depreciation & Amortization | 3,427 | 3,027 | |||||
| Loss (Gain) on Disposal of Equipment | 175 | - | |||||
| (Gain) on Sales of Equipment | (106 | ) | (33 | ) | |||
| Change in Assets and Liabilities | |||||||
| (Inc) in Accts and Notes Receivable | (9,354 | ) | (3,854 | ) | |||
| Dec (Inc) in Inventories | 1,290 | (3,444 | ) | ||||
| (Inc) in Prepayments | (2,389 | ) | (643 | ) | |||
| (Inc) in Net Investment in Sales-type leases | (80 | ) | (69 | ) | |||
| Dec in Other Assets | 738 | 307 | |||||
| Inc in Accounts Payable | 4,242 | 1,330 | |||||
| (Dec) Inc in Accrued Income Tax | (1,165 | ) | 1,911 | ||||
| (Dec) Inc in Other Accrued Expenses | (227 | ) | 4,919 | ||||
| (Dec) in Advanced Billings | (8,519 | ) | (4,647 | ) | |||
| Inc (Dec) in Billings in Excess of Costs and Estimated Earnings | 8,306 | (2,927 | ) | ||||
| Inc in Lease Liability for Operating | 57 | - | |||||
| Inc in Lease Liability for Financing | - | 133 | |||||
| Principal payments of Lease Liability for Operating | (53 | ) | (137 | ) | |||
| (Dec) Inc in Long Term Deferred Tax Liabilities | (78 | ) | 8 | ||||
| (Dec) Inc in Other Long-Term Liabilities | (93 | ) | 599 | ||||
| Net Cash Provided by Operating Activities | $ | 7,408 | $ | 4,123 | |||
| Investing Activities | |||||||
| Intangibles | - | (62 | ) | ||||
| Purchases of Marketable Securities | (24,649 | ) | - | ||||
| Proceeds from Sales of Marketable Securities | 38,522 | - | |||||
| Proceeds from Sales of Equipment | 131 | 67 | |||||
| Additions to Property, Plant, and Equipment | (6,612 | ) | (3,190 | ) | |||
| Net Cash (Required) for Investing Activities | $ | 7,392 | $ | (3,185 | ) | ||
| Financing Activities | |||||||
| Principal payments of Lease Liability for Financing | (22 | ) | (98 | ) | |||
| (Repayment) of Short-Term Borrowings, Net | (751 | ) | (1,673 | ) | |||
| Proceeds of Short-Term Borrowings, Net | 754 | 1,673 | |||||
| (Repayment) of Long-Term Debt | (422 | ) | (318 | ) | |||
| Dividends Paid | (378 | ) | (326 | ) | |||
| Treasury Stock Acquisitions | (11,910 | ) | - | ||||
| Net Cash (Required) for Financing Activities | $ | (12,729 | ) | $ | (742 | ) | |
| Effect of Exchange Rate Changes | (545 | ) | 535 | ||||
| Net Increase in Cash and Cash Equivalents | $ | 1,526 | $ | 731 | |||
| Cash and Cash Equivalents at Beginning of Year | 1,883 | 38,176 | |||||
| Cash and Cash Equivalents at End of Quarter | $ | 3,409 | $ | 38,907 | |||
PAUL MUELLER COMPANY
SUMMARIZED NOTES TO THE FINANCIAL STATEMENTS
(In thousands)
A. The chart below depicts the net revenue on a consolidating basis for the three months ended June 30.
| Three Months Ended June 30 | |||||||
| Revenue | 2024 | 2023 | |||||
| Domestic | $ | 52,830 | $ | 48,295 | |||
| Mueller BV | $ | 13,164 | $ | 12,073 | |||
| Eliminations | $ | (324 | ) | $ | (437 | ) | |
| Net Revenue | $ | 65,670 | $ | 59,931 | |||
The chart below depicts the net revenue on a consolidating basis for the six months ended June 30.
| Six Months Ended June 30 | |||||||
| Revenue | 2024 | 2023 | |||||
| Domestic | $ | 91,707 | $ | 93,880 | |||
| Mueller BV | $ | 24,989 | $ | 23,377 | |||
| Eliminations | $ | (670 | ) | $ | (975 | ) | |
| Net Revenue | $ | 116,026 | $ | 116,282 | |||
The chart below depicts the net revenue on a consolidating basis for the twelve months ended June 30.
| Twelve Months Ended June 30 | |||||||
| Revenue | 2024 | 2023 | |||||
| Domestic | $ | 180,833 | $ | 176,642 | |||
| Mueller BV | $ | 49,322 | $ | 45,695 | |||
| Eliminations | $ | (1,255 | ) | $ | (1,287 | ) | |
| Net Revenue | $ | 228,900 | $ | 221,050 | |||
The chart below depicts the net income (loss) on a consolidating basis for the three months ended June 30.
| Three Months Ended June 30 | |||||||
| Net Income | 2024 | 2023 | |||||
| Domestic | $ | 6,027 | $ | 4,705 | |||
| Mueller BV | $ | 774 | $ | 110 | |||
| Eliminations | $ | 3 | $ | (2 | ) | ||
| Net Income (Loss) | $ | 6,804 | $ | 4,813 | |||
The chart below depicts the net income on a consolidating basis for the six months ended June 30.
| Six Months Ended June 30 | |||||||
| Net Income | 2024 | 2023 | |||||
| Domestic | $ | 10,075 | $ | 9,155 | |||
| Mueller BV | $ | 1,148 | $ | (660 | ) | ||
| Eliminations | $ | 30 | $ | (15 | ) | ||
| Net Income (Loss) | $ | 11,253 | $ | 8,480 | |||
The chart below depicts the net income on a consolidating basis for the twelve months ended June 30.
| Twelve Months Ended June 30 | |||||||
| Net Income | 2024 | 2023 | |||||
| Domestic | $ | (10,408 | ) | $ | 14,322 | ||
| Mueller BV | $ | 3,285 | $ | (941 | ) | ||
| Eliminations | $ | 6 | $ | (21 | ) | ||
| Net Income Loss | $ | (7,117 | ) | $ | 13,360 | ||
B.June 30, 2024 backlog is $187.3 million compared to $106.0 million at June 30, 2023. The majority of this backlog is in the U.S. where backlog is $181.2 million at June 30, 2024 compared to $98.7 million at June 30, 2023. The $82.5 million increase in U.S. backlog is from the pharmaceutical divisions. In the Netherlands, backlog is down slightly with $6.5 million on June 30, 2024 versus $7.7 million on June 30, 2023.
C.Compared to last year, revenue is up $5.7 million (9.6%) on a three-month basis; flat on a six-month basis and up $7.9 million (3.6%) for the trailing twelve months. In the U.S., revenues show a similar pattern. Increased revenue from the pharmaceutical and food and beverage divisions are partially offset by the lower revenue from the components division coming off record revenue in late 2022 and early 2023. In the Netherlands business continues to improve with revenue above last year for all three timeframes.
Net Income is up $2.0 million for three-months; $2.8 million for six months but down $20.4 million before removing the pension settlement charges incurred in December 2023. In the Netherlands, earnings continue to improve following the business restructuring in the Spring of 2023. Efficiencies achieved from the restructuring along with strategic price increases have led to the improved earnings.
We manage our business in the U.S. looking at earnings before tax (EBT) and excluding the effects of LIFO and non-reoccurring events such as the pension settlement. This non-GAAP adjusted EBT (as shown in the table below) show improved results from the strong 2023 for all three timeframes primarily from the pharmaceutical and food and beverage divisions.
| Results Ending June 30th | |||||||||||||||||||||||
| Three Months Ended June 30 | Six Months Ended June 30 | Twelve Months Ended June 30 | |||||||||||||||||||||
| (In Thousands) | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||
| Domestic Net Income | $ | 6,027 | $ | 4,705 | $ | 10,075 | $ | 9,155 | $ | (10,408 | ) | $ | 14,322 | ||||||||||
| Income Tax Expense | $ | 1,899 | $ | 1,468 | $ | 3,070 | $ | 2,873 | $ | (4,560 | ) | $ | 4,430 | ||||||||||
| Domestic EBT - GAAP | $ | 7,926 | $ | 6,173 | $ | 13,145 | $ | 12,028 | $ | (14,968 | ) | $ | 18,752 | ||||||||||
| LIFO Adjustment | $ | (246 | ) | $ | 424 | $ | (463 | ) | $ | 239 | $ | (619 | ) | $ | 1,528 | ||||||||
| Pension Adjustment | $ | - | $ | - | $ | - | $ | - | $ | 41,774 | $ | - | |||||||||||
| Domestic EBT - Non-GAAP | $ | 7,680 | $ | 6,597 | $ | 12,682 | $ | 12,267 | $ | 26,187 | $ | 20,280 | |||||||||||
D.On July 26, 2024, the Company announced construction of a new $20 million facility adding 100,000 square feet of additional space to expand production and research and development. The new facility will be funded through cash and potential new debt. Construction is expected to begin in the fall of 2024 and complete in the fall of 2025.
E.On March 12, 2024, the Board of Directors authorized a tender offer effective from March 15, 2024 through May 7, 2024 for up to $10 million with the option to go to $15 million of the Company's common stock at a price of $80 per share. On April 26, 2024, the Company announced that it would purchase shares up to $15 million. On May 7, 2024, the Company announced that the tender offer had expired with 148,874 shares tendered for $11.9 million. After the completion of the tender offer, cash and marketable securities are $21.6 million as of June 30, 2024.
F.The consolidated financials are affected by the euro to dollar exchange rate when consolidating Mueller B.V., the Dutch subsidiary. The month-end euro to dollar exchange rate was 1.09 for June, 2023; 1.10 for December, 2023 and 1.07 for June, 2024, respectively.
This press release contains forward-looking statements that provide current expectations of future events based on certain assumptions. All statements regarding future performance growth, conditions, or developments are forward-looking statements. Actual future results may differ materially from those described in the forward-looking statements due to a variety of factors, including, but not limited to, the factors described in the Company's Annual Report under "Safe Harbor for Forward-Looking Statements", which is available at paulmueller.com. The Company expressly disclaims any obligation or undertaking to update these forward-looking statements to reflect any future events or circumstances.
The accounting policies related to this report and additional management discussion and analysis are provided in the 2023 annual report, available at
www.paulmueller.com.
Contact Info:
Ken Jeffries (417) 575-9000
kjeffries@paulmueller.com
https://paulmueller.com
