MUEL - Paul Mueller Company Announces Its First Quarter Earnings of 2021

SPRINGFIELD, Mo., April 30, 2021 (GLOBE NEWSWIRE) -- Paul Mueller Company (OTC: MUEL) today announced earnings for the quarter ended March 31, 2021.

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 March 31.

The chart below depicts the net revenue on a consolidating basis for the twelve
months ended March 31.

The chart below depicts the net income on a consolidating basis for the three months
ended March 31.

The chart below depicts the net income on a consolidating basis for the twelve months ended March 31.

B. March 31, 2021 backlog is $69.0 million compared to $61.6 million at December 31, 2020. However, when comparing current backlog to the March 31, 2020 backlog, it has dropped 35.7% from $107.3 million. Of this $38.3 million reduction, $17.7 million is the pharmaceutical divisions finishing up the large pharmaceutical orders and $29.1 million as Mueller Field Operations (MFO) made significant progress on the large juice storage facility project. The backlog in the other U.S. business units is up $11.0 million (48.7%) led by Dairy Farm Equipment (DFE), and the other Industrial Equipment business units. Mueller BV backlog is down $2.2 million from a year ago to $8.5 million.

C. Revenue for the three months is up 7.4% from a year ago led by a rebound in DFE and MFO’s continued work on the juice storage facility. Revenue for the trailing twelve months is up 3.4% driven by the large juice facility project. In the Netherlands, revenue is down slightly from the year before for three months and down 11.7% for the trailing twelve months as the general economy and Covid-19 continue to have a negative effect.

D. Net income for the three months was $1.3 million which is an improvement of $0.4 million over the first quarter of last year even after a negative $0.7 million after tax LIFO effect. The largest contributor to the improvement in the U.S. is the rebound of DFE from historical lows. In the Netherlands, net income is down $0.3 million primarily from lower revenues.

Net income for the trailing twelve months is a $2.1 million loss. However, when the $15.4 million goodwill impairment for the Mueller BV acquisition is excluded, net income would be $13.3 million, a $4.7 million (55.3%) improvement over the previous trailing twelve months’ net income even after absorbing a $0.9 million after tax negative impact from the LIFO reserve. Almost every business segment had improved profits, led by the pharmaceutical groups, DFE and MFO. In the Netherlands, net income would be $0.3 million when excluding the goodwill impairment. This is an improvement over the $0.9 million loss in the prior twelve months even with lower revenue.

E. The Company was granted a loan in the amount of $1.9 million, pursuant to the Paycheck Protection Program under Division A, Title I of the CARES Act, which was enacted March 27, 2020. The loan, which was in the form of a note dated June 12, 2020, issued to the Company, matures on June 11, 2025, and bears interest at a rate of 1% per annum, with a deferral of payments for the first six months. The note may be prepaid by the Company at any time prior to maturity with no prepayment penalties. The loans and accrued interest are forgivable after eight weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent, utilities, and maintains its payroll levels. The Company filed for forgiveness of the loan on November 17, 2020, and is waiting for a response.

F. On February 5, 2021, the Company repurchased 100,000 shares of stock at $40 a share from a shareholder in a private transaction. In addition, as of March 31, 2021, the Company purchased 29 shares under the buyback program announced on March 19, 2021.

G. The pre-tax results for three months ended March 31, 2021, were unfavorably affected by $0.9 million increase in the LIFO reserve. The pre-tax results for the twelve months ended March 31, 2021, were unfavorably affected by $0.5 million increase in the LIFO reserve. The pre-tax results for the twelve months ended March 31, 2020, were favorably affected by a $0.7 million decrease in the LIFO reserve.

H. 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 March, 2020; 1.23 for December, 2020 and 1.17 for March, 2021, 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 2020 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