Miller Industries, Inc.

Good day, ladies and gentlemen, and welcome to the Miller Industries third quarter 2020 results conference call. Please note this event is being recorded. And now at this time, I'd like to turn the call over to Mr. Brendan Dunlap at FTI Consulting. Please go ahead, sir.

Thank you, and good morning, everyone. I would like to welcome you to Miller Industries conference call. We are here to discuss the company's 2020 third 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 fully 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.

Thank you. and good morning, everyone. I don't think I'll surprise anyone by saying that 2020 has been a challenging year for our communities, our customers and our employees. However, I can say with confidence that our employees have risen to the occasion and continue to provide our customers with the best in class service during this pandemic. With that said, I'm extremely encouraged by the changes that we made during the first half of 2020 to help us operate more effectively and safely during this pandemic. These changes, coupled with the beginnings of the reopening of the economy, helped drive the significant sequential improvement that we experienced during the third quarter. More specifically, revenue during the third quarter decreased 13.9% to $168.4 million versus $195.5 million a year ago as the impacts of COVID-19 continued to weigh on our production levels. However, our revenue increased 31% compared to the second quarter of 2020 as our business began to rebound from the sharp declines experienced during that period. Quarterly gross profits decreased by 17.9%, year-over-year to $17.8 million, while gross margin contracted 50 basis points to 10.6%. However, gross margin have expanded approximately 10 basis points year-to-date, reflecting operational improvements and stringent cost controls. Net income was $6.6 million, or 57 cents per share, compared to net income of 8.1 million or 71 cents per share in the third quarter of 2019. Despite the ongoing uncertainty in the macro environment, we continue to invest in our business during the quarter by repurposing a portion of our existing Greenville, Tennessee facility to bring certain production capabilities in-house to mitigate future supply chain constraints. We expect to begin phasing in these production improvements by the end of the year and are confident that these investments will further enhance our production capabilities going forward. Before I turn the call over to Debbie, Will Miller and I would like to take a moment to thank our employees for their incredible efforts and outstanding commitment to operational excellence and best-in-class customer service during these difficult times. Now I'll turn the call over to Debbie, who will review the third quarter financial results. After that, I'll be back with comments about market environment and some closing remarks. Debbie?