Miller Industries Inc. (NYSE:MLR) Q2 2020 Earnings Conference Call - Final Transcript

Aug 06, 2020 • 10:00 am ET

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Miller Industries Inc. (NYSE:MLR) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Miller Industries Second Quarter 2020 Results Conference Call. [Operator Instructions]

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

Executive
Brendan Dunlap

Thank 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 2020 second quarter results, which were released after the close of market yesterday. With us from the management team today are Bill Miller, Chairman of the Board; Will Miller, President and Co-CEO; Jeff Badgley, Co-CEO; Debbie Whitmire, Executive Vice President and CFO; and Frank Madonia, Executive Vice President, Secretary and General Counsel.

Today's call will begin with formal remarks from management, followed by a question-and-answer period. Please 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 formally described in the company's annual report filed on Form 10-K and other filings with the Securities and Exchange Commission.

With these formalities out of the way, I'd like to turn the call over to Jeff. Please go ahead, Jeff.

Executive
Jeffrey I. Badgley

Thank you, and good morning, everyone. Over the last few months, we have experienced an unprecedented health and economic crisis due to the COVID-19 pandemic. Despite the uncertainty caused by this crisis, Miller Industries has remained committed to providing best-in-class products to keep roadways clear around the globe.

Moving on to our financial results. Our performance during the quarter was significantly impacted by COVID-related shutdowns at our facilities as well as shutdowns in our supply chain, which resulted in a decline in top-line sales. Revenue during the second quarter decreased 42.2% to $128.5 million versus $222.3 million a year ago as the economy was impacted by COVID-19 and shutdowns in our supply chain, reduced our production levels. That said, we were able to quickly adjust our operations to reduce cost and minimize overall inefficiencies, while continuing to meet the needs of our customers.

Quarterly gross profits decreased by 29.7% year-over-year to $17.7 million. However, our gross margin expanded approximately 250 basis points year-over-year to 13.8% due to favorable product mix and operational adjustments made during the quarter. Net income was $5.8 million or $0.51 per share compared to net income of $10.7 million or $0.94 per share in the second quarter of 2019. Although market conditions remain unpredictable, we are confident in our ability to continue meeting the needs of our customers, while maintaining stringent social distancing, sanitary protocols and other governmental guidelines to protect the health and safety of our employees.

As we move into the second half of the year, we are working closely with our distribution network as they adjust their inventory to meet customer demand. Further, we continue to invest in technological improvements in our production facilities to increase overhaul