Mueller Water Products (MWA) Q1 2026 earnings summary

Executive summary

• Achieved record first-quarter net sales of $318.2 million, up 4.6% year-over-year, driven by higher pricing and manufacturing efficiencies, with strong operational execution and resilient end-market demand.

• Adjusted EBITDA reached a Q1 record of $72.1 million, up 13.5% year-over-year, and adjusted EBITDA margin expanded to 22.7%.

• Adjusted net income per diluted share increased 16% to $0.29, while reported net income per diluted share was $0.27.

• Leadership transition underway, with a new CEO effective February 2026 and the outgoing CEO remaining as a senior advisor through year-end.

• Continued strategic investments in capacity and operational efficiencies, including transition to a new brass foundry and increased capital expenditures.

Financial highlights

• Gross profit rose 16.3% to $119.8 million, with gross margin expanding 380 basis points to 37.6%.

• Operating income increased 19.6% to $56.7 million, with adjusted operating income up 14.5% to $60.0 million.

• Adjusted net income per diluted share increased 16% to $0.29.

• Free cash flow was $44.0 million, representing 96% of adjusted net income.

• Capital expenditures were $17.2 million, focused on foundry investments.

Outlook and guidance

• Fiscal 2026 net sales guidance raised to $1,470–$1,490 million, up 2.8%–4.2% year-over-year.

• Adjusted EBITDA guidance increased to $355–$360 million, up 8.8%–10.4% year-over-year, with margin above 24%.

• Free cash flow as a percentage of adjusted net income expected to exceed 85% for fiscal 2026.

• Capital expenditures projected at $60–$65 million, targeting capacity expansion and operational enhancements.

• H2 Adjusted EBITDA margin expected to be higher due to seasonality and price actions.