Company: MWA
Filing Date: 2025-11-19
Form Type: 10-K
Source: 0001350593-25-000066
Chunk: 278

Company: Mueller Water Products, Inc.
Filing Date: 2025-11-19
Form: 10-K
Item: Item 1A
Chunk 278
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 anticipated revenues, which may lead to reduced or delayed funding for water infrastructure projects.  Even if favorable economic conditions exist, water infrastructure owners may choose not to address deferred infrastructure needs as a result of a variety of political factors or competing spending priorities. 

Low levels of spending for water and wastewater infrastructure construction activity could adversely affect our sales, profitability and cash flows.

Residential construction activity is important to our business and adverse conditions or sustained uncertainty within this market could adversely affect our financial results.

New water and wastewater infrastructure spending is heavily dependent upon residential construction.  As a result, our financial performance depends significantly on the stability and growth of the residential construction market.  This market depends on a variety of factors beyond our control, including household formation, consumer confidence, interest rates, inflation and the availability of mortgage financing, as well as the mix between single and multifamily construction, availability of construction labor and ultimately the extent to which new construction leads to the development of raw land.  Adverse conditions or sustained uncertainty regarding the residential construction market have had, and may in the future have, an adverse effect on our sales, profitability and cash flows, including the risk that one or more of our distributors and/or end use customers decide to delay purchasing, or determine not to purchase, our products or services.

Our business depends on a small group of key customers for a significant portion of our sales.

A majority of our products are sold primarily to distributors and our success depends on these third parties operating their businesses profitably and effectively.  These distributors’ profitability and effectiveness can vary significantly from company to company and from region to region within the same company.  Further, our largest distributors generally also carry competing products.  We may fail to align our operations with successful distributors in any given market.

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Table of ContentsIndex to Financial Statements

Distributors in our industry have experienced consolidation.  If such consolidation continues, our distributors could be acquired by other distributors who have better relationships with our competitors, and consequently, pricing and profit margin pressure may intensify.  Pricing and profit margin pressure or the loss of any one of our key distributors in any market could adversely affect our operating results.

Certain products and solutions, primarily technology-enabled products and solutions, as well as gas repair products are sold directly to end users.  Some of these customers represent a relatively high concentration of these sales.  Over time, growth in sales is expected to lessen the significance of individual customers.  In the short term, net sales could decline if existing significant customers do not continue to purchase our