Miller Industries, Inc. (NYSE:MLR) Q2 2022 Results Conference Call August 4, 2022 2:00 PM ET

Company Participants

Mike Gaudreau - FTI Consulting

Bill Miller - Chairman

Will Miller - President and CEO

Jeff Badgley - President, International and Military

Debbie Whitmire - EVP and CFO

Frank Madonia - EVP, Secretary and General Counsel

Vince Tiano - Chief Revenue Officer

Jamison Linden - Chief Manufacturing Officer

Conference Call Participants

Arnold Ursaner - Miller Industries

Operator

Good day, ladies and gentlemen, and welcome to the Miller Industries Second Quarter 2022 Results Conference Call. Please note, this event is being recorded.

And now at this time, I would like to turn the call over to Mike Gaudreau of FTI Consulting. Please go ahead, sir.

Mike Gaudreau

Thank you, and good afternoon, everyone. I would like to welcome you to the Miller Industries conference call. We are here to discuss the company’s 2022 second quarter results, which were released after the close of the market yesterday.

With us from the management team today are Bill Miller, Chairman of the Board; Will Miller, President and CEO; Jeff Badgley, President of International and Military; Debbie Whitmire, Executive Vice President and CFO; Frank Madonia, Executive Vice President, Secretary and General Counsel; Vince Tiano, Chief Revenue Officer; and Jamison Linden, Chief Manufacturing Officer.

Today’s call will begin with formal remarks from management followed by a question-and-answer session. Please note, in this afternoon’s conference call, management may make forward-looking statements in accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. I’d like to call your attention to the risks related to these statements, which are more fully described in the company’s Annual Report filed on Form 10-K and other filings with the Securities and Exchange Commission. And at this time, I’d like to turn the call over to Will. Please go ahead, Will.

Will Miller

Thank you, and good afternoon, everyone. In the second quarter, demand remained strong. But our results continue to reflect the impact of supply chain shortages and inflationary pressures. Sales in the second quarter increased 11.2% to $201.5 million compared to the second quarter of last year. However, sequentially, sales declined 6.5% from the first quarter of 2022 due largely to part shortages that impacted the amount of finished goods we were able to deliver during the quarter.

Gross profit for the second quarter was $18.4 million, a decrease of 10.8% compared to the prior year quarter, while gross margin of 9.1% declined 230 basis points year-over-year. Though significant inflation has continued to drive difficult year-over-year comparisons, we are encouraged by our sequential 19.8% improvement in gross profit and 200 basis point improvement to gross margin in comparison to the first quarter of 2022. While we haven’t realized the full benefit of our price increases, some of which only flowed through to results in June, we are encouraged that even a portion of our price increases were able to drive sequential improvement despite the macroeconomic environment and unfavorable product mix.