Copper products company Mueller Industries Inc. (MLI), Tuesday reported a higher profit for the third quarter, as improved margins more than offset a sharp decline in sales that were impacted by weak selling prices of copper.
Nonetheless, shares of the company dropped more than six percent in afternoon trade on the New York Stock Exchange, following the results.
Mueller engages in the manufacture of copper, brass, plastic, and aluminum products. The company has been posting weak sales over the past quarters, partly impacted by weakness in the construction sector. In the third quarter, average price of copper, its principal raw material, was $3.53 per pound, compared with $4.07 per pound in the prior year.
The Memphis, Tennessee-based company reported third-quarter net income of $15.5 million or $0.41 per share, compared with net income of $10.5 million or $0.27 per share last year.
Excluding items, the company reported pro forma earnings of $14 million or $0.51 per share for the quarter.
Sales for the quarter were lower at $514 million, compared with $586 million a year ago. Plumbing & Refrigeration segment reported lower sales due to reduced selling prices, while OEM segment was impacted by lower selling prices and reduced volumes.
During the quarter, Mueller repurchased 10.4 million shares of its outstanding common stock for an aggregate purchase price of $427.4 million.
Moving forward, the company expect prospects to improve on recovery in the construction sector.
Shares of Mueller are trading at $47.54, down 6.45%, on the NYSE.
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