NYSE:MLR Miller Industries Q3 2024 Earnings Report $42.21 +1.21 (+2.95%) As of 04/24/2025 03:59 PM Eastern Earnings HistoryForecast Miller Industries EPS ResultsActual EPS$1.33Consensus EPS $1.33Beat/MissMet ExpectationsOne Year Ago EPS$1.52Miller Industries Revenue ResultsActual Revenue$314.27 millionExpected RevenueN/ABeat/MissN/AYoY Revenue GrowthN/AMiller Industries Announcement DetailsQuarterQ3 2024Date11/12/2024TimeAfter Market ClosesConference Call DateWednesday, November 13, 2024Conference Call Time10:00AM ETUpcoming EarningsMiller Industries' Q1 2025 earnings is scheduled for Tuesday, May 6, 2025, with a conference call scheduled on Thursday, May 8, 2025 at 10:00 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfilePowered by Miller Industries Q3 2024 Earnings Call TranscriptProvided by QuartrNovember 13, 2024 ShareLink copied to clipboard.There are 5 speakers on the call. Operator00:00:00Good day, ladies and gentlemen, and welcome to the Miller Industries Third Quarter 20 24 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 Boudreaux, FTI Consulting. Please go ahead. Speaker 100:00:17Thank you, and good morning, everyone. I would like to welcome you to the Miller Industries conference call. We are here to discuss the company's 2024 Q3 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 Debbie Whitmire, Executive Vice President and CFO and Frank Midonia, Executive Vice President, Secretary and General Counsel. Today's call will begin with formal remarks from management followed by a question and answer session. Speaker 100:00:52Please note in this morning'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 ks and other filings with the Securities and Exchange Commission. At this time, I'd like to turn the call over to Will. Please go ahead, Speaker 200:01:22Will. Thank you, and good morning, everyone. Before I begin, I want to take a moment to extend my sympathies to those impacted by the recent hurricanes in the Southeast and the extreme loss of life and property. 1st and foremost, our thoughts are with those still suffering and we hope for a speedy recovery for those affected. We are not immune to these extreme weather events and Hurricane Helene in particular had an impact on our operations. Speaker 200:01:52As a result, we had to pause production in our Greenville, our smallest facility for 2 weeks. While the financial impact was thankfully marginal, impacting our revenues for the quarter by low single digit millions, our focus was ensuring that our employees were safe, secure and able to perform their jobs to the best of their ability. We are still assessing the hurricane's impact on our production, but expect an effect on 4th quarter results to be equally minimal and expect that the marginal impact to revenue in the Q3 will be shifted into the Q4 as we catch up on invoicing. Turning to our quarterly results. I am pleased to share that even despite impacts from the hurricane, we've delivered another strong quarter of double digit year over year revenue growth. Speaker 200:02:40In the Q3 of 2024, we generated revenues of 314 $300,000 an increase of 14.5 percent year over year, driven by elevated OEM chassis deliveries. Shipments in the Q3 last year were abnormally low, but we were subsequently elevated to fill the gap in the 1st 6 months of 2024. Q3 2024 reflects a normalized level of chassis deliveries based on current demand. Gross profit for the Q3 was $42,000,000 a decrease of 2% compared to the prior year quarter, while our gross margin of 13.4% decreased by 2 20 basis points year over year. The year over year decrease was primarily due to the shift in product mix compared to an extraordinary 2023 period. Speaker 200:03:32As I just mentioned, in the Q3 of 2023, gross margin saw a significant boost as chassis delivery slowed due to supply chain disruptions. Now that chassis deliveries have normalized, we expect to continue operating at the current level and our gross margins for the Q3 of 2024 are consistent with our expected annual margins. In our international business, which accounts for approximately 10% of our total sales, we are encouraged by continued demand and strong order intake. We believe there is still an opportunity to continue ramping international production and expanding activity in the military sector. We believe this can be a solid growth area for us moving forward. Speaker 200:04:18Lastly, before I turn the call over to Debbie, I want to touch on the production capacity expansion plans we mentioned earlier this year. We regularly analyze future production needs at all of our facilities around the globe and work diligently to invest our capital in the areas of the business that we believe will generate the greatest shareholder returns. While we can continue to grow with the current capacity that we have, we will continue to consider expanding capacity and investing in our business to meet future contractual agreements at the appropriate time. We also remain focused on our debt reduction strategy along with our regular distribution of capital to shareholders in the form of our quarterly dividend and investment in our share repurchase program. Now I'll turn the call over to Debbie, who will review the Q3 financial results in more detail. Speaker 200:05:08Following her remarks, I will provide some closing comments and an update on our outlook. Debbie? Speaker 300:05:14Thanks, Will, and good morning, everyone. Net sales for the Q3 of 2024 is $314,300,000 versus $274,600,000 for the Q3 of 2023, a 14.5% year over year increase driven largely by improved deliveries of finished product resulting from the normalization of the chassis market. Net sales for the 1st 9 months of 2024 were $1,000,000,000 versus $857,100,000 for the 1st 9 months of 2023, a 20.8% increase year over year. Cost of operations increased 17.5 percent to $272,200,000 for the Q3 of 2024 compared to $231,700,000 for the Q3 of 2023. The increase in our cost of operations was due largely to our increased revenue levels. Speaker 300:06:13Cost of operations as a percentage of net sales increased approximately 220 basis points from the prior year period to 86.6%, which is largely attributable to the year over year product mix shift that Will mentioned earlier. Gross profit was $42,000,000 or 13.4% of net sales for the Q3 of 2024 compared to $42,900,000 or 15.6 percent of net sales for the prior year period. Year over year decrease was driven largely by the difficult year over year comparison regarding our product mix. As the chassis market normalizes after a few very tumultuous quarters, we expect that our gross margins will appear more in line with our projected level of mid-13s subject to some slight quarter to quarter quarter to quarter fluctuations based on product mix. SG and A expenses were $22,300,000 in the Q3 of 2024 compared to $19,300,000 in the Q3 of 2023. Speaker 300:07:20As a percentage of net sales, SG and A was 7.1%, 10 basis points higher than the prior year period. While this is above our long term target of approximately 6.5%, SG and A as a percentage of sales for the 1st 9 months of 2024 is 6.4%. We anticipate that we will end the year within our expected range. Interest expense for the Q3 of 2024 was $251,000 down 86.2 percent from $1,800,000 for the Q3 of 2023. This reduction was driven by increased interest income related to our elevated accounts receivable balance. Speaker 300:08:03Other expense for the Q3 of 2024 was $321,000 compared to an expense of $294,000 for the Q3 of 2023 attributable largely to currency exchange rate fluctuations. Our effective tax rate for the quarter of 22 percent was slightly higher both year over year and sequentially. As a result, net income for the Q3 of 2024 was $15,400,000 or $1.33 per diluted share compared to net income of $17,500,000 or $1.52 per diluted share in the Q3 of 2023. Turning to the balance sheet. Cash and cash equivalents as of September 30, 2024 was $40,600,000 compared to $23,800,000 as of June 30, 2024 and $29,900,000 as of December 31, 2023. Speaker 300:09:06Accounts receivable as of September 30, 2024 was $34,000,000 compared to $391,800,000 as of June 30, 2024 $286,100,000 as of December 31, 2023. We are incredibly encouraged by our cash generation in this quarter and the conversion of our receivables into cash. We said on our last earnings call that we expected a market increase in cash conversion in the second half of the year and believe that this dynamic will continue as our working capital returns to pre pandemic levels as a percentage of revenue. Turning back to the balance sheet, inventories were $190,300,000 as of September 30, 2024 compared to $187,300,000 as of June 30, 2024 and $189,800,000 as of December 31, 2023. Our inventory levels have remained relatively consistent and we will keep investing in our inventory as appropriate to ensure that we have essential parts readily available to turn work in process inventory and to finish goods for delivery to our customers as quickly as possible. Speaker 300:10:22Accounts payable as of September 30, 2024 was $234,200,000 compared to $243,100,000 as of June 30, 2024 and $191,800,000 as of December 31, 2023. Related to our return of capital to shareholders, the Board of Directors approved our quarterly cash dividend of $0.19 per share payable December 9, 2024 to shareholders of record at the close of business on December 2, 2024, marking the 56th consecutive quarter that the company has paid a dividend. In addition, during the 1st 3 quarters of the year, the company has repurchased 45,000 shares, representing $2,900,000 of the $25,000,000 repurchase program the Board of Directors authorized in April. As cash conversion continues to improve, we have more flexibility with regards to our capital allocation. However, as Will mentioned earlier, we remain focused on both returning capital to shareholders and paying down our debt in line with our long standing business practice. Speaker 300:11:34Lastly, Speaker 400:11:34before I Speaker 300:11:35hand the call back to Will, I would just like to provide a brief reminder that our Q4 is a seasonably lower revenue quarter relative to the rest of the year due to holidays, annual inventory audits and planned maintenance at our facilities. Now, I'll turn the call back over to Will for some closing remarks. Speaker 200:11:54Thank you, Debbie. The core demand drivers of our business remain solid and distributor retail deliveries have remained steady compared to last year. However, we experienced a slow order entry during the quarter. While we are still conducting our analysis, early insights into our order intake and retail activity suggests this slowdown is not indicative of a fundamental decline in demand for our products. Instead, timing of OEM chassis deliveries to our distributors, distributor throughput capacity and furthermore, feedback from customers indicates they were holding off on orders due to political uncertainty, though their interest in our products remains strong. Speaker 200:12:36We anticipate that our backlog will return to historical levels over the next 1 to 2 quarters. Despite this, we believe our stabilized supply chain, purchasing effectiveness and enhanced productivity position positions us to sustain positive momentum in our results as illustrated by our performance over the 1st 9 months of this year. While we faced some challenges this quarter, we remain extremely confident in the business and our historical compounded annual growth rate, and we believe that we will achieve strong year over year profitability increase as well. Notably, as we continue to convert our receivables into cash, we will continue to prioritize returning capital to our shareholders as we always have at Miller Industries. As always, the entire management team and I would like to thank all of our employees, suppliers, customers and shareholders for their continued support of Miller Industries. Speaker 200:13:40At this time, we'd like to open the line for any questions. Operator00:13:45Thank you. We will now be conducting a question and answer session. It looks like our first question is from Mike Schlosky, D. A. Davidson. Speaker 400:14:04Yes. Hi, good morning. Thanks for taking my questions. First, I've maybe got a 2 part question for you, Will, and based on your last comments there. One, it's only been a week or 2, but since election days in the rearview mirror, have you gotten any indications that orders are being the flow again after that? Speaker 400:14:27And then maybe secondly, you mentioned there are some dealership limitations with their throughput. I hadn't appreciated that. I was curious whether you have to help guide the dealers or give them any assistance in increasing their throughput or perhaps even find additional dealers to help them open new locations to kind of keep the ball rolling on growth here? Speaker 200:14:56Thank you. Well, with regards to your first question, with regards to post election sediment in the industry, Vince Tiano, our Chief Revenue Officer, has been reaching out to distribution. And just general sentiment has increased significantly. We've seen multiple deals through different distributors that were holding, waiting for the election to take place that have actually completed. Although we haven't seen this in obviously last week's order intake rate, which was only a few days after the election, We do believe that it will ultimately reinstook confidence in the consumer. Speaker 200:15:44With regards to throughput, obviously distribution got more chassis earlier in the year. They're working through those and we're providing them the appropriate inventory to finish those builds and deliver those to customers. Yes, I think from the distribution network as a whole, we're in a great position with the distribution network we have. And currently, I know of at least a handful of distributors that are reinvesting into their facilities and expanding their facilities as well as looking to outsource integration, chassis body integration to local bodybuilders in their areas. So I think they're all diligently working on resolving their issues. Speaker 200:16:33And I believe in the next quarter or 2, we'll see them catch up on their throughput capacity as well. Speaker 400:16:44Great. I appreciate that. Maybe moving on to a discussion on margins. I guess first I wanted to ask about the gross margin from here. You had mentioned kind of the low mid-13s is a reasonable range, you at least implied that. Speaker 400:17:00Tell us a little bit about how that might play out next year if you've got a more normalized chassis environment and I realize the comps were really on 2023 to 2024 changing, but now 2024 to 2025, do you expect a comparable mix between the full chassis sales and the system only sales? Or is there anything we should think about in next year's mix that would suggest that you would not be in the 13% to get next year? Speaker 200:17:29No. I think overall this year and last year have been a little lumpy as Debbie alluded to from quarter to quarter. What we're anticipating seeing for chassis OEM chassis deliveries for the full year of 2020 2024 is right on par with what we expected, just not the timing of it wasn't exactly where we had anticipated from quarter to quarter. Moving forwards, I don't see any issues continuing the margins where they have been for the full year into next year. Speaker 400:18:07Okay. And from an SG and A standpoint, you had mentioned 6.5% kind of being the goal level. As you grow a little more from here, I mean, certainly, you're still expect at least some growth in 2025. You've got good order occasions here. Do you think you can start to get some additional leverage on that SG and A spend and maybe get that a little less than 6.5% in the 25%? Speaker 300:18:37Hi, Mike. This is Debbie. We certainly are looking at cost control in any form and fashion that we can, but the new compliance and regulations around the world that we're dealing with are adding things as quickly as we're being able to control some of the other items. So hopefully, some of these compliance issues will not add as much SG and A as we are anticipating. So we hope to gain some leverage, but the additional regulations that we're dealing with continues to add SG and A cost that are really out of our control. Speaker 400:19:16Got it. I appreciate that. Thank you for the answers, everybody. Speaker 200:19:21Absolutely. Have a great day, Mike. Thank you. Operator00:19:26Thank you. Thank you. It looks like there are no further questions at this time. I'd like to turn the floor back to Will Miller for closing remarks. Speaker 200:19:34Thank you. I'd like to thank you all again for joining us on the call today. And we look forward to speaking with you on our Q4 conference call. If you would like information on how to participate and ask questions on the call, please visit our Investor Relations website, millerind.com/investors or email investors. Relationsmillerind.com. Speaker 200:19:56Thank you. Operator00:19:58Thank you. This does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallMiller Industries Q3 202400:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsPress Release(8-K)Quarterly report(10-Q) Miller Industries Earnings HeadlinesIf EPS Growth Is Important To You, Miller Industries (NYSE:MLR) Presents An OpportunityApril 21, 2025 | finance.yahoo.comDA Davidson Lowers Target for Miller Industries (MLR) Amid Uncertainty | MLR Stock NewsApril 21, 2025 | gurufocus.comHere’s How to Claim Your Stake in Elon’s Private Company, xAIEven though xAI is a private company, tech legend and angel investor Jeff Brown found a way for everyday folks like you… To partner with Elon on what he believes will be the biggest AI project of the century… Starting with as little as $500.April 25, 2025 | Brownstone Research (Ad)Analysts Are More Bearish On Miller Industries, Inc. (NYSE:MLR) Than They Used To BeMarch 13, 2025 | finance.yahoo.comMiller Industries: Take Advantage Of The Recent FallMarch 10, 2025 | seekingalpha.comMiller Industries (NYSE:MLR) Has Announced That It Will Be Increasing Its Dividend To $0.20March 9, 2025 | finance.yahoo.comSee More Miller Industries Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Miller Industries? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Miller Industries and other key companies, straight to your email. Email Address About Miller IndustriesMiller Industries (NYSE:MLR), together with its subsidiaries, manufactures and sells towing and recovery equipment. The company offers wreckers that are used to recover and tow disabled vehicles and other equipment; and car carriers, which are specialized flat-bed vehicles with hydraulic tilt mechanisms, which are used to transport new or disabled vehicles and other equipment. It also provides transport trailers for moving various vehicles for auto auctions, car dealerships, leasing companies, and other similar operations. The company markets its products under the Century, Vulcan, Challenger, Holmes, Champion, Chevron, Eagle, Titan, Jige, and Boniface brands. Miller Industries, Inc. sells its products through independent distributors in North America, and Canada, Mexico; and through prime contractors to governmental entities. Miller Industries, Inc. was incorporated in 1990 and is headquartered in Ooltewah, Tennessee.View Miller Industries ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Seismic Shift at Intel: Massive Layoffs Precede Crucial EarningsRocket Lab Lands New Contract, Builds Momentum Ahead of EarningsAmazon's Earnings Could Fuel a Rapid Breakout Tesla Earnings Miss, But Musk Refocuses and Bulls ReactQualcomm’s Range Narrows Ahead of Earnings as Bulls Step InWhy It May Be Time to Buy CrowdStrike Stock Heading Into EarningsCan IBM’s Q1 Earnings Spark a Breakout for the Stock? 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There are 5 speakers on the call. Operator00:00:00Good day, ladies and gentlemen, and welcome to the Miller Industries Third Quarter 20 24 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 Boudreaux, FTI Consulting. Please go ahead. Speaker 100:00:17Thank you, and good morning, everyone. I would like to welcome you to the Miller Industries conference call. We are here to discuss the company's 2024 Q3 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 Debbie Whitmire, Executive Vice President and CFO and Frank Midonia, Executive Vice President, Secretary and General Counsel. Today's call will begin with formal remarks from management followed by a question and answer session. Speaker 100:00:52Please note in this morning'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 ks and other filings with the Securities and Exchange Commission. At this time, I'd like to turn the call over to Will. Please go ahead, Speaker 200:01:22Will. Thank you, and good morning, everyone. Before I begin, I want to take a moment to extend my sympathies to those impacted by the recent hurricanes in the Southeast and the extreme loss of life and property. 1st and foremost, our thoughts are with those still suffering and we hope for a speedy recovery for those affected. We are not immune to these extreme weather events and Hurricane Helene in particular had an impact on our operations. Speaker 200:01:52As a result, we had to pause production in our Greenville, our smallest facility for 2 weeks. While the financial impact was thankfully marginal, impacting our revenues for the quarter by low single digit millions, our focus was ensuring that our employees were safe, secure and able to perform their jobs to the best of their ability. We are still assessing the hurricane's impact on our production, but expect an effect on 4th quarter results to be equally minimal and expect that the marginal impact to revenue in the Q3 will be shifted into the Q4 as we catch up on invoicing. Turning to our quarterly results. I am pleased to share that even despite impacts from the hurricane, we've delivered another strong quarter of double digit year over year revenue growth. Speaker 200:02:40In the Q3 of 2024, we generated revenues of 314 $300,000 an increase of 14.5 percent year over year, driven by elevated OEM chassis deliveries. Shipments in the Q3 last year were abnormally low, but we were subsequently elevated to fill the gap in the 1st 6 months of 2024. Q3 2024 reflects a normalized level of chassis deliveries based on current demand. Gross profit for the Q3 was $42,000,000 a decrease of 2% compared to the prior year quarter, while our gross margin of 13.4% decreased by 2 20 basis points year over year. The year over year decrease was primarily due to the shift in product mix compared to an extraordinary 2023 period. Speaker 200:03:32As I just mentioned, in the Q3 of 2023, gross margin saw a significant boost as chassis delivery slowed due to supply chain disruptions. Now that chassis deliveries have normalized, we expect to continue operating at the current level and our gross margins for the Q3 of 2024 are consistent with our expected annual margins. In our international business, which accounts for approximately 10% of our total sales, we are encouraged by continued demand and strong order intake. We believe there is still an opportunity to continue ramping international production and expanding activity in the military sector. We believe this can be a solid growth area for us moving forward. Speaker 200:04:18Lastly, before I turn the call over to Debbie, I want to touch on the production capacity expansion plans we mentioned earlier this year. We regularly analyze future production needs at all of our facilities around the globe and work diligently to invest our capital in the areas of the business that we believe will generate the greatest shareholder returns. While we can continue to grow with the current capacity that we have, we will continue to consider expanding capacity and investing in our business to meet future contractual agreements at the appropriate time. We also remain focused on our debt reduction strategy along with our regular distribution of capital to shareholders in the form of our quarterly dividend and investment in our share repurchase program. Now I'll turn the call over to Debbie, who will review the Q3 financial results in more detail. Speaker 200:05:08Following her remarks, I will provide some closing comments and an update on our outlook. Debbie? Speaker 300:05:14Thanks, Will, and good morning, everyone. Net sales for the Q3 of 2024 is $314,300,000 versus $274,600,000 for the Q3 of 2023, a 14.5% year over year increase driven largely by improved deliveries of finished product resulting from the normalization of the chassis market. Net sales for the 1st 9 months of 2024 were $1,000,000,000 versus $857,100,000 for the 1st 9 months of 2023, a 20.8% increase year over year. Cost of operations increased 17.5 percent to $272,200,000 for the Q3 of 2024 compared to $231,700,000 for the Q3 of 2023. The increase in our cost of operations was due largely to our increased revenue levels. Speaker 300:06:13Cost of operations as a percentage of net sales increased approximately 220 basis points from the prior year period to 86.6%, which is largely attributable to the year over year product mix shift that Will mentioned earlier. Gross profit was $42,000,000 or 13.4% of net sales for the Q3 of 2024 compared to $42,900,000 or 15.6 percent of net sales for the prior year period. Year over year decrease was driven largely by the difficult year over year comparison regarding our product mix. As the chassis market normalizes after a few very tumultuous quarters, we expect that our gross margins will appear more in line with our projected level of mid-13s subject to some slight quarter to quarter quarter to quarter fluctuations based on product mix. SG and A expenses were $22,300,000 in the Q3 of 2024 compared to $19,300,000 in the Q3 of 2023. Speaker 300:07:20As a percentage of net sales, SG and A was 7.1%, 10 basis points higher than the prior year period. While this is above our long term target of approximately 6.5%, SG and A as a percentage of sales for the 1st 9 months of 2024 is 6.4%. We anticipate that we will end the year within our expected range. Interest expense for the Q3 of 2024 was $251,000 down 86.2 percent from $1,800,000 for the Q3 of 2023. This reduction was driven by increased interest income related to our elevated accounts receivable balance. Speaker 300:08:03Other expense for the Q3 of 2024 was $321,000 compared to an expense of $294,000 for the Q3 of 2023 attributable largely to currency exchange rate fluctuations. Our effective tax rate for the quarter of 22 percent was slightly higher both year over year and sequentially. As a result, net income for the Q3 of 2024 was $15,400,000 or $1.33 per diluted share compared to net income of $17,500,000 or $1.52 per diluted share in the Q3 of 2023. Turning to the balance sheet. Cash and cash equivalents as of September 30, 2024 was $40,600,000 compared to $23,800,000 as of June 30, 2024 and $29,900,000 as of December 31, 2023. Speaker 300:09:06Accounts receivable as of September 30, 2024 was $34,000,000 compared to $391,800,000 as of June 30, 2024 $286,100,000 as of December 31, 2023. We are incredibly encouraged by our cash generation in this quarter and the conversion of our receivables into cash. We said on our last earnings call that we expected a market increase in cash conversion in the second half of the year and believe that this dynamic will continue as our working capital returns to pre pandemic levels as a percentage of revenue. Turning back to the balance sheet, inventories were $190,300,000 as of September 30, 2024 compared to $187,300,000 as of June 30, 2024 and $189,800,000 as of December 31, 2023. Our inventory levels have remained relatively consistent and we will keep investing in our inventory as appropriate to ensure that we have essential parts readily available to turn work in process inventory and to finish goods for delivery to our customers as quickly as possible. Speaker 300:10:22Accounts payable as of September 30, 2024 was $234,200,000 compared to $243,100,000 as of June 30, 2024 and $191,800,000 as of December 31, 2023. Related to our return of capital to shareholders, the Board of Directors approved our quarterly cash dividend of $0.19 per share payable December 9, 2024 to shareholders of record at the close of business on December 2, 2024, marking the 56th consecutive quarter that the company has paid a dividend. In addition, during the 1st 3 quarters of the year, the company has repurchased 45,000 shares, representing $2,900,000 of the $25,000,000 repurchase program the Board of Directors authorized in April. As cash conversion continues to improve, we have more flexibility with regards to our capital allocation. However, as Will mentioned earlier, we remain focused on both returning capital to shareholders and paying down our debt in line with our long standing business practice. Speaker 300:11:34Lastly, Speaker 400:11:34before I Speaker 300:11:35hand the call back to Will, I would just like to provide a brief reminder that our Q4 is a seasonably lower revenue quarter relative to the rest of the year due to holidays, annual inventory audits and planned maintenance at our facilities. Now, I'll turn the call back over to Will for some closing remarks. Speaker 200:11:54Thank you, Debbie. The core demand drivers of our business remain solid and distributor retail deliveries have remained steady compared to last year. However, we experienced a slow order entry during the quarter. While we are still conducting our analysis, early insights into our order intake and retail activity suggests this slowdown is not indicative of a fundamental decline in demand for our products. Instead, timing of OEM chassis deliveries to our distributors, distributor throughput capacity and furthermore, feedback from customers indicates they were holding off on orders due to political uncertainty, though their interest in our products remains strong. Speaker 200:12:36We anticipate that our backlog will return to historical levels over the next 1 to 2 quarters. Despite this, we believe our stabilized supply chain, purchasing effectiveness and enhanced productivity position positions us to sustain positive momentum in our results as illustrated by our performance over the 1st 9 months of this year. While we faced some challenges this quarter, we remain extremely confident in the business and our historical compounded annual growth rate, and we believe that we will achieve strong year over year profitability increase as well. Notably, as we continue to convert our receivables into cash, we will continue to prioritize returning capital to our shareholders as we always have at Miller Industries. As always, the entire management team and I would like to thank all of our employees, suppliers, customers and shareholders for their continued support of Miller Industries. Speaker 200:13:40At this time, we'd like to open the line for any questions. Operator00:13:45Thank you. We will now be conducting a question and answer session. It looks like our first question is from Mike Schlosky, D. A. Davidson. Speaker 400:14:04Yes. Hi, good morning. Thanks for taking my questions. First, I've maybe got a 2 part question for you, Will, and based on your last comments there. One, it's only been a week or 2, but since election days in the rearview mirror, have you gotten any indications that orders are being the flow again after that? Speaker 400:14:27And then maybe secondly, you mentioned there are some dealership limitations with their throughput. I hadn't appreciated that. I was curious whether you have to help guide the dealers or give them any assistance in increasing their throughput or perhaps even find additional dealers to help them open new locations to kind of keep the ball rolling on growth here? Speaker 200:14:56Thank you. Well, with regards to your first question, with regards to post election sediment in the industry, Vince Tiano, our Chief Revenue Officer, has been reaching out to distribution. And just general sentiment has increased significantly. We've seen multiple deals through different distributors that were holding, waiting for the election to take place that have actually completed. Although we haven't seen this in obviously last week's order intake rate, which was only a few days after the election, We do believe that it will ultimately reinstook confidence in the consumer. Speaker 200:15:44With regards to throughput, obviously distribution got more chassis earlier in the year. They're working through those and we're providing them the appropriate inventory to finish those builds and deliver those to customers. Yes, I think from the distribution network as a whole, we're in a great position with the distribution network we have. And currently, I know of at least a handful of distributors that are reinvesting into their facilities and expanding their facilities as well as looking to outsource integration, chassis body integration to local bodybuilders in their areas. So I think they're all diligently working on resolving their issues. Speaker 200:16:33And I believe in the next quarter or 2, we'll see them catch up on their throughput capacity as well. Speaker 400:16:44Great. I appreciate that. Maybe moving on to a discussion on margins. I guess first I wanted to ask about the gross margin from here. You had mentioned kind of the low mid-13s is a reasonable range, you at least implied that. Speaker 400:17:00Tell us a little bit about how that might play out next year if you've got a more normalized chassis environment and I realize the comps were really on 2023 to 2024 changing, but now 2024 to 2025, do you expect a comparable mix between the full chassis sales and the system only sales? Or is there anything we should think about in next year's mix that would suggest that you would not be in the 13% to get next year? Speaker 200:17:29No. I think overall this year and last year have been a little lumpy as Debbie alluded to from quarter to quarter. What we're anticipating seeing for chassis OEM chassis deliveries for the full year of 2020 2024 is right on par with what we expected, just not the timing of it wasn't exactly where we had anticipated from quarter to quarter. Moving forwards, I don't see any issues continuing the margins where they have been for the full year into next year. Speaker 400:18:07Okay. And from an SG and A standpoint, you had mentioned 6.5% kind of being the goal level. As you grow a little more from here, I mean, certainly, you're still expect at least some growth in 2025. You've got good order occasions here. Do you think you can start to get some additional leverage on that SG and A spend and maybe get that a little less than 6.5% in the 25%? Speaker 300:18:37Hi, Mike. This is Debbie. We certainly are looking at cost control in any form and fashion that we can, but the new compliance and regulations around the world that we're dealing with are adding things as quickly as we're being able to control some of the other items. So hopefully, some of these compliance issues will not add as much SG and A as we are anticipating. So we hope to gain some leverage, but the additional regulations that we're dealing with continues to add SG and A cost that are really out of our control. Speaker 400:19:16Got it. I appreciate that. Thank you for the answers, everybody. Speaker 200:19:21Absolutely. Have a great day, Mike. Thank you. Operator00:19:26Thank you. Thank you. It looks like there are no further questions at this time. I'd like to turn the floor back to Will Miller for closing remarks. Speaker 200:19:34Thank you. I'd like to thank you all again for joining us on the call today. And we look forward to speaking with you on our Q4 conference call. If you would like information on how to participate and ask questions on the call, please visit our Investor Relations website, millerind.com/investors or email investors. Relationsmillerind.com. Speaker 200:19:56Thank you. Operator00:19:58Thank you. This does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time.Read morePowered by