On Nov. 5, Mueller Water (NYSE:MWA) (NYSE:MWA-B) released fourth-quarter earnings for the period ended Sept. 30.
- The soft residential construction market led to a 8.3% decrease on the top line.
- The revenue decrease contributed to a 310-basis-point drop-off in operating margin.
- Mueller Water is rated four stars in our Motley Fool CAPS investor-intelligence database. Former parent and fellow Motley Fool Hidden Gems recommendation Walter Industries (NYSE:WLT) also sports an impressive four-star rating.
(Figures in millions, except per-share data.)
Income Statement Highlights
|
Q4 2007 |
Q4 2006 |
Change | |
|---|---|---|---|
|
Sales |
$474.9 |
$518.1 |
(8.3%) |
|
Net Profit |
$14.6 |
$16.9 |
(13.6%) |
|
EPS |
$0.13 |
$0.15 |
(13.3%) |
|
Diluted Shares |
115.5 |
114.7 |
0.7% |
Get back to basics with the income statement.
Margin Checkup
|
Q4 2007 |
Q4 2006 |
Change* | |
|---|---|---|---|
|
Gross Margin |
24.9% |
26.1% |
(1.2) |
|
Operating Margin |
10.7% |
13.8% |
(3.1) |
|
Net Margin |
3.1% |
3.3% |
(0.2) |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q4 2007 |
Q4 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$87.3 |
$81.4 |
7.2% |
|
Accounts Rec. |
$302.1 |
$322.9 |
(6.4%) |
|
Inventory |
$453.5 |
$454.6 |
(0.2%) |
|
Liabilities |
Q4 2007 |
Q4 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$100.7 |
$129.9 |
(22.5%) |
|
Long-Term Debt |
$1,094.3 |
$1,118.3 |
(2.1%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
|
FY 2007 |
FY 2006 |
Change | |
|---|---|---|---|
|
Cash From Ops. |
$159.2 |
$107.6 |
48% |
|
Capital Expenditures |
$88.3 |
$71.1 |
24.2% |
|
Free Cash Flow |
$70.9 |
$36.5 |
94.2% |
Free cash flow is a Fool's best friend.
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