Paul Mueller Company Announces Its Third Quarter Earnings of 2020

SPRINGFIELD, Mo., Oct. 30, 2020 (GLOBE NEWSWIRE) -- Paul Mueller Company (OTC: MUEL) today announced earnings for the quarter ended September 30, 2020.

PAUL MUELLER COMPANY
NINE-MONTH REPORT
Unaudited
(In thousands)

CONSOLIDATED STATEMENTS OF INCOME

				Three Months Ended		Nine Months Ended		Twelve Months Ended
				September 30		September 30		September 30
				2020	2019	2020	2019	2020	2019

Net Sales				$ 51,607	$ 45,968	$ 146,990	$ 141,911	$ 202,256	$ 187,529
Cost of Sales				35,504	33,117	102,405	103,883	140,957	137,825
Gross Profit				$ 16,103	$ 12,851	$ 44,585	$ 38,028	$ 61,299	$ 49,704
Selling, General and Administrative Expense				11,167	11,205	33,156	33,701	45,127	45,666
Operating Income				$ 4,936	$ 1,646	$ 11,429	$ 4,327	$ 16,172	$ 4,038
Interest Expense				(110)	(213)	(819)	(808)	(838)	(995)
Other Income				427	81	869	366	854	365
Income before Provision for Income Taxes				$ 5,253	$ 1,514	$ 11,479	$ 3,885	$ 16,188	$ 3,408
Provision for Income Taxes				1,258	374	2,761	861	3,905	524
Net Income				$ 3,995	$ 1,140	$ 8,718	$ 3,024	$ 12,283	$ 2,884

Earnings per Common Share ––			Basic	$3.34	$0.95	$7.29	$2.53	$10.27	$2.41
			Diluted	$3.34	$0.95	$7.29	$2.53	$10.27	$2.41

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

						Nine Months Ended
						September 30
						2020	2019

		Net Income				$ 8,718	$ 3,024
		Other Comprehensive Income (Loss), Net of Tax:
		Foreign Currency Translation Adjustment				1,590	(1,216)
		Comprehensive Income				$ 10,308	$ 1,808

CONSOLIDATED BALANCE SHEETS

						September 30	December 31
						2020	2019

		Cash and Short-Term Investments				$ 21,583	$ 1,072
		Accounts Receivable				20,273	28,509
		Inventories				21,042	20,552
		Current Net Investments in Sales-Type Leases				56	47
		Other Current Assets				1,654	3,763
		Current Assets				$ 64,608	$ 53,943

		Net Property, Plant, and Equipment				45,668	47,406
		Right of Use Assets				1,459	1,421
		Other Assets				23,477	21,355
		Long-Term Net Investments in Sales-Type Leases				840	769
		Total Assets				$ 136,052	$ 124,894

		Accounts Payable				$ 10,513	$ 10,534
		Current Maturities and Short-Term debt				1,370	6,208
		Current Lease Liabilities				466	485
		Other Current Liabilities				31,209	27,021
		Current Liabilities				$ 43,558	$ 44,248

		Long-Term Debt				18,805	15,334
		Long-Term Pension Liabilities				27,288	30,395
		Other Long-Term Liabilities				2,688	1,566
		Lease Liabilities				993	936
		Total Liabilities				$ 93,332	$ 92,479
		Shareholders' Investment				42,720	32,415
		Total Liabilities and Shareholders' Investment				$ 136,052	$ 124,894





SELECTED FINANCIAL DATA

							September 30	December 31
							2020	2019
			Book Value per Common Share				$35.73	$27.11
			Total Shares Outstanding				1,195,747	1,195,866
			Backlog				$ 75,287	$ 79,791

CONSOLIDATED STATEMENT OF SHAREHOLDERS' INVESTMENT
								Accumulated Other Comprehensive Income (Loss)

				Common Stock	Paid-in Surplus	Retained Earnings	Treasury Stock
				Common Stock	Paid-in Surplus	Retained Earnings	Treasury Stock		Total
Balance, December 31, 2019				$ 1,508	$ 9,708	$ 68,484	$ (6,341)	$ (40,944)	$ 32,415
Add (Deduct):
	Net Income					8,718			8,718
	Other Comprehensive Income, Net of Tax							1,590	1,590
	Treasury Stock Acquisition						(3)		(3)
Balance, September 30, 2020				$ 1,508	$ 9,708	$ 77,202	$ (6,344)	$ (39,354)	$ 42,720


CONSOLIDATED STATEMENT OF CASH FLOWS



						Nine Months Ended September 30, 2020		Nine Months Ended September 30, 2019
		Operating Activities:

		Net Income				$ 8,718		$ 3,024

		Adjustment to Reconcile Net Income to Net Cash Provided by Operating Activities:
		Pension Contributions (Greater) Less than Expense				(3,107)		(2,631)
		Bad Debt Expense (Recovery)				(15)		(210)
		Depreciation & Amortization				4,855		4,919
		Loss (Gain) on Sales of Equipment				1		(18)
		Change in Assets and Liabilities
		Dec in Accts and Notes Receivable				8,251		2,426
		Dec (Inc) in Cost in Excess of Estimated Earnings and Billings				939		(180)
		(Inc) in Inventories				(490)		(546)
		Dec (Inc) in Prepayments				1,170		(643)
		(Inc) in Net Investment in Sales-type leases				(79)		-
		Dec (Inc) in Intangibles				-		(118)
		(Inc) in Other LT Assets				(338)		(48)
		(Dec) Inc in Accounts Payable				(21)		2,012
		Inc (Dec) in Other Accrued Expenses				7,389		(948)
		Inc in Advanced Billings				1,241		7,295
		(Dec) Inc in Billings in Excess of Costs and Estimated Earnings				(4,441)		1,633
		Inc in Lease Liability for operating				36		-
		Inc in Lease Liability for financing				27		-
		Inc (Dec) In Other Liabilities				108		(198)
		Net Cash Provided by Operating Activities				$ 24,244		$ 15,769

		Investing Activities
		Proceeds from Sales of Equipment				4		31
		Additions to Property, Plant, and Equipment				(3,128)		(1,062)
		Net Cash (Required) for Investing Activities				$ (3,124)		$ (1,031)

		Financing Activities
		(Repayment) of principal portion of lease liability for operating				(26)		-
		(Repayment) of Short-Term Borrowings, Net				(4,826)		(7,692)
		Proceeds (Repayment) of Long-Term Debt				2,640		(5,553)
		Treasury Stock Acquisitions				(3)		-
		Net Cash (Required) for Financing Activities				$ (2,215)		$ (13,245)

		Effect of Exchange Rate Changes				1,606		(1,215)

		Net Increase in Cash and Cash Equivalents				$ 20,511		$ 278

		Cash and Cash Equivalents at Beginning of Year				1,072		715

		Cash and Cash Equivalents at End of Quarter				$ 21,583		$ 993

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 September 30.

Three Months Ended September 30
Revenue		2020			2019
Domestic	$41,453			$36,168
Mueller BV	$10,518			$10,310
Eliminations	($364		)	($510		)
Net Revenue	$51,607			$45,968

The chart below depicts the net revenue on a consolidating basis for the nine months ended September 30.

Nine Months Ended September 30
Revenue		2020			2019
Domestic	$112,979			$104,190
Mueller BV	$34,907			$39,393
Eliminations	($896		)	($1,672		)
Net Revenue	$146,990			$141,911

The chart below depicts the net revenue on a consolidating basis for the twelve months ended September 30.

Twelve Months Ended September 30
Revenue		2020			2019
Domestic	$153,289			$135,378
Mueller BV	$49,950			$54,123
Eliminations	($983		)	($1,972		)
Net Revenue	$202,256			$187,529

The chart below depicts the net income on a consolidating basis for the three months ended September 30.

Three Months Ended September 30
Net Income		2020		2019
Domestic	$3,773		$2,273
Mueller BV	$169		($1,085		)
Eliminations	$53		($48		)
Net Income	$3,995		$1,140

The chart below depicts the net income on a consolidating basis for the nine months ended September 30.

Nine Months Ended September 30
Net Income		2020		2019
Domestic	$8,224		$4,093
Mueller BV	$431		($997		)
Eliminations	$63		($72		)
Net Income	$8,718		$3,024

The chart below depicts the net income on a consolidating basis for the twelve months ended September 30.

Twelve Months Ended September 30
Net Income		2020		2019
Domestic	$11,543		$5,090
Mueller BV	$623		($2,149		)
Eliminations	$117		($57		)
Net Income	$12,283		$2,884

B.	The strong beginning of the year backlog in the U.S. and reduced spending has mitigated the initial financial impact of the pandemic resulting in strong earnings for the first nine months. However, the uncertainty in the economy has slowed order entry as well as the increase in COVID-19 cases in the US and Europe is causing concern as countries begin to lock back down. Looking forward, we face the uncertainty of lower pharmaceutical and field backlog, the increasing risk of COVID-19 related disruptions, and increased costs after the aggressive cost-cutting during the beginning of the pandemic.

C.	September 30, 2020 backlog was $75.3 million which is $4.5 million lower than the $79.8 million at December 31, 2019. In the U.S., backlog is $64.2 million which is down $5.5 million from December 31, 2019. Two thirds of the U.S. backlog is in the Pharmaceutical groups and Mueller Field Operations which is working on the large juice storage facility. Mueller BV backlog has been relatively flat but still at recent historic lows.

D.	Revenue for the three, nine and twelve months are higher in the US driven by the large pharmaceutical backlog in the U.S. that went into production in mid-2019. Mueller Field Operations showed increased revenue from the previous year’s quarter from a large juice facility project. Dairy Farm Equipment revenues showed signs of rebounding with a 25% increase in quarterly revenue from the second quarter. In The Netherlands, the business conditions continue to be soft with trailing revenues flat to last year for the quarter but down to last year at nine and twelve months. However, The Netherlands continues to save in expenses.

	Net Income was favorable from the prior year at three, nine and twelve month trailing results. In the US, pharmaceutical and field operations work continue to drive overall profitability and the dairy farm equipment segment experienced its best quarterly results in over a year. In the Netherlands, better margins and expense savings are more than offsetting the reduced revenue.

E.	September 30, 2020, total debt was $20.2 million compared to $21.5 million as of December 31, 2019. Cash and cash equivalents were $21.6 million at September 30, 2020 compared to $1.1 million at December 31, 2019. Advanced Billings for the Company which is a liability representing deposits received from customers on large projects was $10.1 million at September 30^th compared to $8.9 million at December 31, 2019.

	All bank covenants were in compliance as of September 30, 2020.

F.	The pre-tax results for the three months ended September 30, 2020, were favorably affected by $0.2 million decrease in the LIFO reserve. The pre-tax results for the nine months ended September 30, 2020, were favorably affected by $0.3 million decrease in the LIFO reserve. The pre-tax results for the twelve months ended September 30, 2020, were favorably affected by $0.8 million decrease in the LIFO reserve. The pre-tax results for the three months ended September 30, 2019, were unfavorably affected by $0.1 million increase in the LIFO reserve. The pre-tax results for the nine months ended September 30, 2019, were unfavorably affected by $0.4 million increase in the LIFO reserve. The pre-tax results for the twelve months ended September 30, 2019, were unfavorably affected by $0.3 million increase in the LIFO reserve.

G.	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 1.10 for September 2019; 1.12 for December 2019; and 1.17 for September 2020.

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 2019 annual report, available at
www.paulmueller.com.

Press Contact: Ken Jeffries | Paul Mueller Company | Springfield, MO 65802 | (417) 575-9346

kjeffries@paulmueller.com | http://paulmueller.com

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.

You just read:

Paul Mueller Company Announces Its Third Quarter Earnings of 2020

Distribution channels: Automotive Industry, Business & Economy

EIN Presswire's priority is author transparency. We do our best to weed out false and misleading content. The content above is the sole responsibility of the author who makes it available. If you have any complaints, kindly contact the author above.