Mueller Water Products Reports 2025 First Quarter Results

Core Insights - Mueller Water Products, Inc. reported a strong financial performance for the first quarter of fiscal 2025, with net sales increasing by 18.7% to $304.3 million compared to $256.4 million in the prior year quarter [1][5][6] - The company achieved a reported net income of $35.3 million, a significant increase of 146.9% from $14.3 million in the prior year quarter, resulting in a net income margin of 11.6% [10][39] - Adjusted EBITDA rose by 41.7% to $63.5 million, with an improved adjusted EBITDA margin of 20.9% compared to 17.5% in the prior year quarter [11][39] Financial Performance - Net sales increased by $47.9 million, or 18.7%, primarily due to higher volumes and pricing across most product lines [6][12] - Operating income surged by 107.9% to $47.4 million, with an operating margin of 15.6%, up from 8.9% in the prior year quarter [7][39] - Adjusted operating income increased by 78.2% to $52.4 million, with an adjusted operating margin of 17.2%, compared to 11.5% in the prior year quarter [9][39] Segment Results - Water Flow Solutions segment net sales increased by 23.6% to $174.6 million, driven by higher volumes of iron gate and specialty valves [12][13] - Water Management Solutions segment net sales rose by 12.7% to $129.7 million, primarily due to increased volumes of hydrants [15][16] Cash Flow and Balance Sheet - Net cash provided by operating activities decreased to $54.1 million from $67.9 million in the prior year quarter, attributed to changes in working capital [20][22] - Free cash flow decreased to $42.2 million from $62.2 million, reflecting higher capital expenditures of $11.9 million compared to $5.7 million in the prior year [22][46] - As of December 31, 2024, total debt was $449.5 million, with cash and cash equivalents of $338.2 million, resulting in a debt leverage ratio of 1.5 times [23][24] Fiscal 2025 Outlook - The company raised its fiscal 2025 guidance for consolidated net sales to between $1,370 million and $1,390 million, representing a 4.2% to 5.7% increase compared to the prior year [24][25] - Adjusted EBITDA expectations for fiscal 2025 were increased to between $310 million and $315 million, indicating an 8.9% to 10.6% increase compared to the prior year [24][25]