Miller Industries(US:MLR)2021-11-06 22:51Financial Data and Key Metrics Changes - Third quarter revenues decreased by 2.2% year-over-year to $164.7 million, primarily due to supply chain disruptions [7][12] - Gross profit remained flat at $17.8 million, with gross margin increasing approximately 23 basis points year-over-year to 10.8% [8][12] - Net income for the third quarter was $3.8 million or $0.34 per share, down from $6.6 million or $0.57 per share in the same quarter of 2020 [14] Business Line Data and Key Metrics Changes - Domestic business demand is at near all-time highs, but production is hindered by raw material shortages [9] - International business saw increased demand, particularly in Europe, although export activity from the U.S. has not yet returned to pre-pandemic levels [10] Market Data and Key Metrics Changes - The company is experiencing strong demand in its markets, but supply chain constraints are creating challenges [20][21] - Inventory levels increased significantly, with raw materials and work-in-progress contributing to the backlog [27] Company Strategy and Development Direction - The company is focused on mitigating supply chain disruptions and inflationary pressures while maintaining operational excellence [9][20] - Plans to implement price increases to recover costs and manage backlog effectively [29][30] - The company is expanding its supply base and redesigning products to reduce reliance on sole sourcing [38] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the ongoing challenges posed by supply chain issues but remains optimistic about future growth opportunities [21] - The company is well-positioned to capitalize on demand once supply chain conditions normalize [20][21] Other Important Information - The Board of Directors approved a quarterly cash dividend of $0.18 per share, payable on December 13, 2021 [18] - The company has made significant investments in ERP systems, which will continue to impact SG&A expenses for the next 3 to 4 years [13][37] Q&A Session Summary Question: Revenue impact from supply chain shortages - Management indicated that approximately $13.5 million to $14 million in billable product is currently held up due to supply chain issues [27] Question: Pricing adjustments for backlog orders - Management confirmed that they have initiated multiple price increases throughout the year to address cost pressures [29][30] Question: Labor staffing updates - Management reported progress in staffing, including the use of sign-on bonuses to attract skilled workers [33] Question: Capital expenditures for 2022 - Management discussed potential capital expenditures but emphasized that decisions will depend on the resolution of supply chain disruptions [38] Question: Public research coverage - Management expressed openness to analysts but emphasized a commitment to providing equal information to all stakeholders [49][50]