Miller Industries, Inc.

Good day, ladies and gentlemen, and welcome to the Miller Industries first 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 Goudreau at FTI Consulting. Please go ahead, sir.

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 first 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 Jameson 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. At this time, I'd like to turn the call over to Will. Please go ahead, Will.

Thank you, and good afternoon, everyone. Our first quarter results are reflective of the continued effects of the global supply chain crisis and related inflationary pressures on both raw materials and labor that we and other businesses have been experiencing over the past several quarters. Despite this, we were pleased to be able to deliver both sequential and year-over-year revenue growth due to the strong demand we continue to see for our products. Our sales increased 26.9% to $215.5 million compared to the first quarter last year and 6.9% compared to the fourth quarter of 2021. Gross profit for the first quarter was $15.3 million, a decrease of roughly 1.7% compared to the prior quarter, while gross margin in the first quarter dropped approximately 220 basis points year over year, driven by continuation of inflationary pressures on labor and materials, part shortages, and global supply chain inefficiencies. As we mentioned, last quarter we have enacted a series of price increases and material surcharges to our customers to cover the increased costs. Some of the increases went into effect during the first quarter, with more to follow in the second quarter, and we should begin to yield results as we move through the remainder of the year. We continue to experience a strong backlog and are seeing continued elevated demand as evidenced by not only our year-over-year revenue growth, but also our sequential revenue growth from the end of last year. As material shortages ease and our price increases go into effect, We are continuously optimistic about future top-line growth, prospects, and fully capturing demand. As for our international business, there is a cloud of uncertainty due to military conflict between Russia and Ukraine. Although demand remains strong, we have not experienced any order cancellations to date. The situation in Ukraine could potentially impact our businesses, but it is difficult to predict how how the conflict will evolve, and if it will ultimately impact our businesses at all. Now, I'll turn the call over to Debbie, who will review the first quarter financial results, and then I'll give a market update and provide some closing remarks. Debbie?