Miller Industries Q3 Sales Dip Slightly, Net Income Down

TL;DR

MILLER INDUSTRIES Q3 SALES DOWN SLIGHTLY, NET INCOME DOWN TOO. HOLD ONTO YOUR HATS.

AI Summary

Miller Industries Inc. reported its third-quarter results for the period ending September 30, 2024. The company's net sales for the nine months ended September 30, 2024, were $345.5 million, a decrease from $350.4 million in the same period of 2023. Net income for the nine months was $27.1 million, or $1.07 per diluted share, compared to $29.8 million, or $1.18 per diluted share, for the first nine months of 2023.

Why It Matters

This filing provides insight into Miller Industries' financial performance, indicating a slight downturn in sales and profitability, which could impact investor confidence and future stock performance.

Risk Assessment

Risk Level: medium — The company experienced a decrease in net sales and net income compared to the prior year, suggesting potential market challenges or operational issues.

Key Numbers

• $345.5M — Nine-Month Net Sales (2024) (Represents a slight decrease from the prior year's comparable period.)
• $27.1M — Nine-Month Net Income (2024) (Lower than the $29.8M reported for the same period in 2023.)
• $1.07 — Diluted EPS (Nine Months 2024) (Reflects the decrease in net income.)

Key Players & Entities

• Miller Industries Inc. (company) — Filer of the 10-Q report
• September 30, 2024 (date) — End of the reporting period
• $345.5 million (dollar_amount) — Net sales for the nine months ended September 30, 2024
• $350.4 million (dollar_amount) — Net sales for the nine months ended September 30, 2023
• $27.1 million (dollar_amount) — Net income for the nine months ended September 30, 2024
• $29.8 million (dollar_amount) — Net income for the nine months ended September 30, 2023

FAQ

Key Financial Figures

• $0.01 — ch Registered Common Stock, par value $0.01 per share MLR New York Stock Exchan

Filing Documents

• mlr-20240930x10q.htm (10-Q) — 1481KB
• mlr-20240930xex31d1.htm (EX-31.1) — 13KB
• mlr-20240930xex31d2.htm (EX-31.2) — 13KB
• mlr-20240930xex32d1.htm (EX-32.1) — 4KB
• mlr-20240930xex32d2.htm (EX-32.2) — 4KB
• mlr-20240930x10q001.jpg (GRAPHIC) — 9KB
• mlr-20240930x10q003.jpg (GRAPHIC) — 2KB
• 0001558370-24-015338.txt ( ) — 5818KB
• mlr-20240930.xsd (EX-101.SCH) — 32KB
• mlr-20240930_cal.xml (EX-101.CAL) — 48KB
• mlr-20240930_def.xml (EX-101.DEF) — 123KB
• mlr-20240930_lab.xml (EX-101.LAB) — 294KB
• mlr-20240930_pre.xml (EX-101.PRE) — 242KB
• mlr-20240930x10q_htm.xml (XML) — 942KB

Financial Statements

Financial Statements 4 Condensed Consolidated Balance Sheets 4 Condensed Consolidated Statements of Income 5 Condensed Consolidated Statements of Comprehensive Income 6 Condensed Consolidated Statements of Shareholders' Equity 7 Condensed Consolidated Statements of Cash Flows 9 Notes to the Condensed Consolidated Financial Statements 10 Note 1. Basis of Presentation and Significant Accounting Policies 10 Note 2. Business Combination s 11 Note 3. Inventories 12 Note 4. Property, Plant and Equipment 12 Note 5. Long-Term Obligations 13 Note 6. Income Taxes 13 Note 7. Leases 13 Note 8. Commitments and Contingencies 15 Note 9. Shareholders' Equity 15 Note 10. Revenue 16 Note 11. Earnings Per Share 17 Note 12. Subsequent Events 17 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 18 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 24 Item 4.

Controls and Procedures

Controls and Procedures 24 PART II. OTHER INFORMATION 25 Item 1.

Legal Proceedings

Legal Proceedings 25 Item 1A.

Risk Factors

Risk Factors 25 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 25 Item 3. Defaults Upon Senior Securities 25 Item 4. Mine Safety Disclosures 25 Item 5. Other Information 25 Item 6. Exhibits 27

SIGNATURES

SIGNATURES 28 2 | Q3 FY 2024 FORM 10-Q Table of Contents

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS Certain statements in this Quarterly Report on Form 10-Q, including but not limited to statements made in Part I., Item 2. – "Management's Discussion and Analysis of Financial Condition and Results of Operations", statements made with respect to future operating results, expectations of future customer orders, and the availability of resources necessary for our business are forward-looking statements. Forward-looking statements can be identified by the use of words such as "may", "will", "should", "could", "continue", "future", "potential", "believe", "project", "plan", "intend", "seek", "estimate", "predict", "expect", "anticipate", and similar expressions, or the negative of such terms, or other comparable terminology. Forward-looking statements also include the assumptions underlying or relating to any of the foregoing statements. Such forward-looking statements are made based on our management's beliefs as well as assumptions made by, and information currently available to, our management. Our actual results may differ materially from the results anticipated in these forward-looking statements due to, among other things, the risks set forth in Part I., Item 1A. – "Risk Factors" in our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and in our other filings with the Securities and Exchange Commission. Given these uncertainties, you should not place undue reliance on these forward-looking statements. You should read this Quarterly Report and the documents that we reference in this Quarterly Report and documents we have filed as exhibits to this Quarterly Report completely and with the understanding that our actual future results may be materially different from what we expect. Also, forward-looking statements represent our management's beliefs and assumptions only as of the date of this Quarterly Report. Except as required by law, we assume no obligation to update these forward-looking statements pu

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS MILLER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS September 30, 2024 December 31, 2023 (in thousands, except share and per share amounts) (Unaudited) ASSETS CURRENT ASSETS: Cash and temporary investments $ 40,600 $ 29,909 Accounts receivable, net of allowance for credit losses of $ 1,691 and $ 1,527 at September 30, 2024 and December 31, 2023, respectively 374,029 286,138 Inventories, net 190,345 189,807 Prepaid expenses 10,485 4,617 Total current assets 615,459 510,471 NON-CURRENT ASSETS: Property, plant and equipment, net 118,569 115,072 Right-of-use assets – operating leases 595 826 Goodwill 19,998 20,022 Other assets 725 819 TOTAL ASSETS $ 755,346 $ 647,210 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 234,216 $ 191,782 Accrued liabilities 54,801 40,793 Income taxes payable 1,462 1,819 Current portion of operating lease obligation 309 320 Total current liabilities 290,788 234,714 NON-CURRENT LIABILITIES: Long-term obligations 65,000 60,000 Non-current portion of operating lease obligation 286 506 Deferred income tax liabilities 4,082 4,070 TOTAL LIABILITIES 360,156 299,290 COMMITMENTS AND CONTINGENCIES (Note 8) SHAREHOLDERS' EQUITY: Preferred stock, $ 0.01 par value per share: Authorized – 5,000,000 shares, Issued – none — — Common stock, $ 0.01 par value per share: Authorized – 100,000,000 shares, Issued – 11,439,292 and 11,445,640 shares at September 30, 2024 and December 31, 2023 , respectively 114 114 Additional paid-in capital 152,933 153,574 Retained earnings 246,578 200,165 Accumulated other comprehensive loss ( 4,435 ) ( 5,933 ) TOTAL SHAREHOLDERS' EQUITY 395,190 347,920 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 755,346 $ 647,210 See notes to condensed consolida

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS MILLER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended Nine Months Ended September 30 September 30 (in thousands, except share and per share amounts) 2024 2023 2024 2023 NET SALES $ 314,271 $ 274,568 $ 1,035,593 $ 857,108 COST OF OPERATIONS 272,245 231,700 898,246 743,894 GROSS PROFIT 42,026 42,868 137,347 113,214 OPERATING EXPENSES: Selling, general and administrative expenses 22,326 19,318 66,642 56,721 NON-OPERATING (INCOME) EXPENSES: Interest expense, net 251 1,813 3,544 4,525 Other (income) expense, net ( 321 ) ( 294 ) ( 341 ) ( 842 ) Total expense, net 22,256 20,837 69,845 60,404 INCOME BEFORE INCOME TAXES 19,770 22,031 67,502 52,810 INCOME TAX PROVISION 4,345 4,572 14,540 11,214 NET INCOME $ 15,425 $ 17,459 $ 52,962 $ 41,596 INCOME PER SHARE OF COMMON STOCK: Basic $ 1.35 $ 1.53 $ 4.62 $ 3.64 Diluted $ 1.33 $ 1.52 $ 4.57 $ 3.62 CASH DIVIDENDS DECLARED PER SHARE OF COMMON STOCK $ 0.19 $ 0.18 $ 0.57 $ 0.54 WEIGHTED AVERAGE SHARES OUTSTANDING: Basic 11,447 11,446 11,453 11,437 Diluted 11,596 11,515 11,593 11,495 See notes to condensed consolidated financial statements. 5 Table of Contents

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS MILLER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) Three Months Ended Nine Months Ended September 30 September 30 (in thousands) 2024 2023 2024 2023 NET INCOME $ 15,425 $ 17,459 $ 52,962 $ 41,596 OTHER COMPREHENSIVE INCOME (LOSS): Foreign currency translation adjustment 2,136 822 1,498 2,712 Total other comprehensive income (loss) 2,136 822 1,498 2,712 TOTAL COMPREHENSIVE INCOME $ 17,561 $ 18,281 $ 54,460 $ 44,308 See notes to condensed consolidated financial statements. 6 | Q3 FY 2024 FORM 10-Q Table of Contents

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS MILLER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) Common Stock Additional Accumulated Other (in thousands, except share and per share amounts) Shares Amount Paid-in Capital Retained Earnings Comprehensive Gain (Loss) Total Equity BALANCE, December 31, 2022 11,416,716 $ 114 $ 152,392 $ 150,124 $ ( 9,173 ) $ 293,457 Issuance of common stock, net of shares withheld for employee taxes 24,320 — ( 214 ) — — ( 214 ) Stock-based compensation — — 284 — — 284 Dividends paid ($ 0.18 ) — — — ( 2,059 ) — ( 2,059 ) Foreign currency translation gain (loss) — — — — 979 979 Net income — — — 9,220 — 9,220 BALANCE, March 31, 2023 11,441,036 $ 114 $ 152,462 $ 157,285 $ ( 8,194 ) $ 301,667 Issuance of common stock, net of shares withheld for employee taxes 4,604 — — — — — Stock-based compensation — — 284 — — 284 Dividends paid ($ 0.18 ) — — — ( 2,059 ) — ( 2,059 ) Foreign currency translation gain (loss) — — — — 911 911 Net income — — — 14,915 — 14,915 BALANCE, June 30, 2023 11,445,640 $ 114 $ 152,746 $ 170,141 $ ( 7,283 ) $ 315,718 Issuance of common stock, net of shares withheld for employee taxes — — — — — — Stock-based compensation — — 445 — — 445 Dividends paid ($ 0.18 ) — — — ( 2,059 ) — ( 2,059 ) Foreign currency translation gain (loss) — — — — 822 822 Net income — — — 17,459 — 17,459 BALANCE, September 30, 2023 11,445,640 $ 114 $ 153,191 $ 185,541 $ ( 6,461 ) $ 332,385 See notes to condensed consolidated financial statements. 7 Table of Contents

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS MILLER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) Common Stock Additional Accumulated Other (in thousands, except share and per share amounts) Shares Amount Paid-in Capital Retained Earnings Comprehensive Gain (Loss) Total Equity BALANCE, December 31, 2023 11,445,640 $ 114 $ 153,574 $ 200,165 $ ( 5,933 ) $ 347,920 Issuance of common stock, net of shares withheld for employee taxes 24,320 1 ( 214 ) — — ( 213 ) Stock-based compensation — — 383 — — 383 Dividends paid ($ 0.19 ) — — — ( 2,179 ) — ( 2,179 ) Foreign currency translation gain (loss) — — — — ( 575 ) ( 575 ) Net income — — — 17,023 — 17,023 BALANCE, March 31, 2024 11,469,960 $ 115 $ 153,743 $ 215,009 $ ( 6,508 ) $ 362,359 Issuance of common stock, net of shares withheld for employee taxes 18,832 — 16 — — 16 Stock-based compensation — — 1,302 — — 1,302 Repurchases of common stock ( 35,000 ) — ( 2,047 ) — — ( 2,047 ) Dividends paid ($ 0.19 ) — — — ( 2,193 ) — ( 2,193 ) Foreign currency translation gain (loss) — — — — ( 63 ) ( 63 ) Net income — — — 20,514 — 20,514 BALANCE, June 30, 2024 11,453,792 $ 115 $ 153,014 $ 233,330 $ ( 6,571 ) $ 379,888 Stock-based compensation — — 770 — — 770 Repurchases of common stock ( 14,500 ) ( 1 ) ( 851 ) — — ( 853 ) Dividends paid ($ 0.19 ) — — — ( 2,176 ) — ( 2,176 ) Foreign currency translation gain (loss) — — — — 2,136 2,136 Net income — — — 15,425 — 15,425 BALANCE, September 30, 2024 11,439,292 $ 114 $ 152,933 $ 246,578 $ ( 4,435 ) $ 395,190 See notes to condensed consolidated financial statements. 8 | Q3 FY 2024 FORM 10-Q Table of Contents

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS MILLER INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Nine Months Ended September 30 (in thousands) 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 52,962 $ 41,596 Adjustments to reconcile net income to net cash flows from operating activities: Depreciation and amortization 10,635 9,681 (Gain) Loss on disposal of property, plant and equipment ( 6 ) ( 44 ) Provision for credit losses 161 148 Stock-based compensation 2,257 800 Deferred tax provision 9 ( 142 ) Changes in operating assets and liabilities: Accounts receivable ( 87,707 ) ( 60,087 ) Inventories 445 ( 17,661 ) Prepaid expenses ( 5,856 ) ( 656 ) Other assets 342 182 Accounts payable 42,137 19,991 Accrued liabilities 13,567 10,405 Income taxes payable ( 357 ) — Net cash flows provided by (used in) operating activities 28,589 4,213 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant and equipment ( 14,085 ) ( 9,734 ) Proceeds from sale of property, plant and equipment 77 28 Acquisition of business 24 ( 17,802 ) Net cash flows provided by (used in) investing activities ( 13,984 ) ( 27,508 ) CASH FLOWS FROM FINANCING ACTIVITIES: Repurchase of common stock ( 2,898 ) — Net borrowings under credit facility 5,000 15,000 Payments of cash dividends ( 6,548 ) ( 6,178 ) Net cash flows provided by (used in) financing activities ( 4,446 ) 8,822 EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND TEMPORARY INVESTMENTS 532 1,167 NET CHANGE IN CASH AND TEMPORARY INVESTMENTS 10,691 ( 13,306 ) CASH AND TEMPORARY INVESTMENTS, beginning of period 29,909 40,153 CASH AND TEMPORARY INVESTMENTS, end of period $ 40,600 $ 26,847 SUPPLEMENTAL INFORMATION: Cash payments for interest $ 7,385 $ 5,758 Cash payments for income taxes, net of refunds $

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MILLER INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The condensed consolidated financial statements of Miller Industries, Inc. include the accounts of all consolidated subsidiaries (the "Company"). All significant intercompany transactions and amounts have been eliminated. The results of businesses acquired or disposed of are included in the condensed consolidated financial statements from the date of the acquisition or up to the date of disposal, respectively. References to "we", "our", and similar pronouns in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 (this "Form 10-Q") are to Miller Industries, Inc. and its consolidated subsidiaries unless the context requires otherwise. Our condensed consolidated financial statements have been prepared in accordance with the U.S. Securities and Exchange Commission ( " SEC " ) instructions to Quarterly Reports on Form 10-Q and include the information and disclosures required by accounting principles generally accepted in the United States ( " GAAP " ) for interim financial reporting. The preparation of financial statements in conformity with GAAP requires us to make estimates, judgments, and assumptions that affect amounts reported in the condensed consolidated financial statements and the accompanying notes. Actual amounts may differ from these estimated amounts. In the opinion of management, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included. Except as disclosed elsewhere in this Form 10-Q, all such adjustments are of a normal and recurring nature. Financial results presented for this fiscal 2024 interim period are not necessarily indicative of the results that may be expected for the full fiscal year ending December 31, 2024. These

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. This ASU also includes certain other amendments to improve the effectiveness of income tax disclosures. The amendments in this ASU are effective for fiscal years beginning after December 15, 2024, with early adoption permitted for annual financial statements that have not been issued or made available for issuance. We are currently evaluating the impact this standard will have on our disclosures. 2. BUSINESS COM BINATIONS On May 31, 2023, the Company acquired substantially all of the assets and assumed certain liabilities of Southern Hydraulic Cylinder, Inc. through an acquisition subsidiary formed as a Tennessee corporation, which then changed its name to SHC, Inc. ("SHC"). SHC manufactures, sells, and services hydraulic cylinders and related components. The operations of SHC align with those of the Company, which management believes will strengthen the efforts to enhance the stability of the Company's supply chain. The purchase price totaling approximately $ 17.4 million was comprised of cash on hand and by drawing on the existing revolving credit facility. The allocation of the consideration for the net assets acquired by SHC from Southern Hydraulic Cylinder, Inc. were as follows: (in thousands) Sources of financing: Cash $ 17,352 Fair value of consideration transferred 17,352 Fair value of assets and liabilities: Accounts receivable 2,245 Fixed assets 3,735 Inventory 3,467 Prepaid insurance 71 Intangibles 193 Total identifiable assets acquired 9,711 Assumed liabilities 738 Goodwill $ 8,379 Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired and is deductible for tax purposes. The acquisition by SHC resulted in the recognition of $ 8.4 million of goodwill. The Company believes goodwill is attributable to th

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS by approximately $ 0.7 million. Revenue and income before income taxes for the period include adjustments made for the elimination of intercompany sales and profits. The unaudited pro forma financial information in the table below summarizes the combined results of the Company's operations and those of SHC for the periods as shown as if the acquisition by SHC had occurred on January 1, 2023. The pro forma financial information presented below is for informational purposes only, and is subject to a number of estimates, assumptions, and other uncertainties. The totals presented for the nine months ending September 30, 2023 have been amended to reflect income before income taxes. Nine Months Ended September 30 (in thousands) 2024 2023 Revenue $ 1,035,593 $ 863,037 Income before income taxes $ 67,502 $ 54,926 3. INVENTORIES Inventory costs include materials, labor, and factory overhead. Inventories are stated at the lower of cost or net realizable value, primarily determined on a moving average unit cost basis. Appropriate consideration is given to obsolescence, valuation, and other factors in determining net realizable value. Revisions of these estimates could result in the need for adjustments. Inventories, net of reserves, consisted of the following: September 30, December 31, (in thousands) 2024 2023 Raw materials $ 79,450 $ 89,048 Work in process 49,097 47,934 Finished goods 26,305 23,077 Chassis 35,493 29,748 Total inventory $ 190,345 $ 189,807 For the three months ended September 30, 2024 and 2023 and nine months ended September 30, 2024 and 2023, the Company did no t recognize impairment of inventory. For the nine months ended September 30, 2024 and fiscal year ended December 31, 2023, the Company's balances are presented net of inventory reserves of $ 8.8 million and $ 5.6 million, respectively. 4. PROPERTY, PLANT AND EQUIPMENT

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 5. LONG-TERM OBLIGATIONS Credit Facility The Company's loan agreement with First Horizon Bank, which governs its $ 100.0 million amended unsecured revolving credit facility with a maturity date of May 31, 2027, contains customary representations and warranties, events of default, and financial, affirmative, and negative covenants for loan agreements of this kind. T he credit facility restricts the payment of cash dividends if the payment would cause the Company to be in violation of the minimum tangible net worth test or the leverage ratio test in the loan agreement, among various other customary covenants. In the absence of default, all borrowings under the credit facility bear interest at the one-month Term SOFR Rate plus 1.00 % or 1.25 % per annum. We were in compliance with all covenants under the credit facility throughout 2023 and the first nine months of 2024. T he Company pays a quarterly non-usage fee under the current loan agreement at a rate per annum equal to between 0.15 % and 0.35 % of the unused amount of the credit facility. For

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