x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
For the quarterly period ended |
June
30, 2006
|
o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
Commission file number |
0-24298
|
MILLER
INDUSTRIES, INC.
|
(Exact
Name of Registrant as Specified in Its
Charter)
|
Tennessee
|
62-1566286
|
(State
or Other Jurisdiction of Incorporation or Organization)
|
(I.R.S.
Employer Identification No.)
|
8503
Hilltop Drive
Ooltewah,
Tennessee
|
37363
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(423)
238-4171
|
(Registrant’s
Telephone Number, Including
Area Code)
|
Large
Accelerated Filer o
|
Accelerated
Filer x
|
Non-Accelerated
Filer o
|
June
30, 2006
(Unaudited)
|
December
31, 2005
|
||||||
ASSETS
|
|||||||
CURRENT
ASSETS:
|
|||||||
Cash
and temporary investments
|
$
|
3,127
|
$
|
6,147
|
|||
Accounts
receivable, net of allowance for doubtful accounts of $2,158 and
$1,834 at
June 30, 2006 and December 31, 2005, respectively
|
72,581
|
65,792
|
|||||
Inventories,
net
|
47,194
|
38,318
|
|||||
Prepaid
expenses and other
|
3,770
|
739
|
|||||
Current
assets of discontinued operations held for sale
|
747
|
2,422
|
|||||
Total
current assets
|
127,419
|
113,418
|
|||||
PROPERTY,
PLANT, AND EQUIPMENT, net
|
19,389
|
17,443
|
|||||
GOODWILL,
net
|
11,619
|
11,619
|
|||||
OTHER
ASSETS
|
1,074
|
1,443
|
|||||
NONCURRENT
ASSETS OF DISCONTINUED OPERATIONS HELD
FOR SALE
|
377
|
647
|
|||||
|
$
|
159,878
|
$
|
144,570
|
|||
LIABILITIES
AND SHAREHOLDERS’ EQUITY
|
|||||||
CURRENT
LIABILITIES:
|
|||||||
Current
portion of long-term obligations
|
$
|
1,569
|
$
|
1,595
|
|||
Accounts
payable
|
49,249
|
45,352
|
|||||
Accrued
liabilities and other
|
10,041
|
9,821
|
|||||
Current
liabilities of discontinued operations held for sale
|
4,964
|
6,244
|
|||||
Total
current liabilities
|
65,823
|
63,012
|
|||||
LONG-TERM
OBLIGATIONS,
less current portion
|
16,137
|
16,803
|
|||||
COMMITMENTS
AND CONTINGENCIES (Notes
5 and 8)
|
|||||||
SHAREHOLDERS’
EQUITY:
|
|||||||
Preferred
stock, $.01 par value; 5,000,000 shares authorized, none issued
or
outstanding
|
-
|
-
|
|||||
Common
stock, $.01 par value; 100,000,000 shares authorized, 11,355,866
and
11,297,474 outstanding at June 30, 2006 and December 31, 2005,
respectively
|
114
|
113
|
|||||
Additional
paid-in capital
|
158,651
|
157,996
|
|||||
Accumulated
deficit
|
(82,457
|
)
|
(93,882
|
)
|
|||
Accumulated
other comprehensive income
|
1,610
|
528
|
|||||
Total
shareholders’ equity
|
77,918
|
64,755
|
|||||
|
$
|
159,878
|
$
|
144,570
|
Three
Months Ended
June
30,
|
Six
Months Ended
June
30,
|
||||||||||||
2006
|
2005
|
2006
|
2005
|
||||||||||
NET
SALES
|
$
|
91,923
|
$
|
92,938
|
$
|
185,359
|
$
|
169,834
|
|||||
|
|||||||||||||
COSTS
AND EXPENSES:
|
|||||||||||||
Costs
of operations
|
78,062
|
79,461
|
157,353
|
147,375
|
|||||||||
Selling,
general and administrative expenses
|
6,400
|
6,175
|
12,984
|
11,681
|
|||||||||
Interest
expense, net
|
968
|
1,200
|
1,802
|
2,363
|
|||||||||
Total
costs and expenses
|
85,430
|
86,836
|
172,139
|
161,419
|
|||||||||
INCOME
FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
6,493
|
6,102
|
13,220
|
8,415
|
|||||||||
INCOME
TAX PROVISION
|
951
|
903
|
1,795
|
1,145
|
|||||||||
INCOME
FROM CONTINUING OPERATIONS
|
5,542
|
5,199
|
11,425
|
7,270
|
|||||||||
DISCONTINUED
OPERATIONS:
|
|||||||||||||
Loss
from discontinued operations, before taxes
|
-
|
(34
|
)
|
-
|
(80
|
)
|
|||||||
Income
tax provision
|
-
|
-
|
-
|
-
|
|||||||||
Loss
from discontinued operations
|
-
|
(34
|
)
|
-
|
(80
|
)
|
|||||||
NET
INCOME
|
$
|
5,542
|
$
|
5,165
|
$
|
11,425
|
$
|
7,190
|
|||||
BASIC
INCOME PER COMMON SHARE:
|
|||||||||||||
Income
from continuing operations
|
$
|
0.49
|
$
|
0.46
|
$
|
1.01
|
$
|
0.65
|
|||||
Loss
from discontinued operations
|
-
|
-
|
-
|
-
|
|||||||||
Basic
income per common share
|
$
|
0.49
|
$
|
0.46
|
$
|
1.01
|
$
|
0.65
|
|||||
DILUTED
INCOME PER COMMON SHARE:
|
|||||||||||||
Income
from continuing operations
|
$
|
0.48
|
$
|
0.45
|
$
|
0.99
|
$
|
0.64
|
|||||
Loss
from discontinued operations
|
-
|
-
|
-
|
-
|
|||||||||
Diluted
income per common share
|
$
|
0.48
|
$
|
0.45
|
$
|
0.99
|
$
|
0.64
|
|||||
WEIGHTED
AVERAGE SHARES OUTSTANDING:
|
|||||||||||||
Basic
|
11,337
|
11,197
|
11,323
|
11,195
|
|||||||||
Diluted
|
11,593
|
11,401
|
11,596
|
11,409
|
Six
Months Ended
June
30,
|
|||||||
2006
|
2005
|
||||||
OPERATING
ACTIVITIES:
|
|||||||
Net
income
|
$
|
11,425
|
$
|
7,190
|
|||
Adjustments
to reconcile net income to net cash provided by (used in) operating
activities:
|
|||||||
Loss
from discontinued operations
|
-
|
80
|
|||||
Depreciation
and amortization
|
1,421
|
1,565
|
|||||
Amortization
of deferred financing costs
|
61
|
266
|
|||||
Provision
for doubtful accounts
|
255
|
234
|
|||||
Stock-based
compensation
|
154
|
-
|
|||||
Issuance
of non-employee director shares
|
75
|
75
|
|||||
Deferred
income tax provision
|
-
|
(19
|
)
|
||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
receivable
|
(6,276
|
)
|
(15,651
|
)
|
|||
Inventories
|
(7,842
|
)
|
(4,769
|
)
|
|||
Prepaid
expenses and other
|
(2,996
|
)
|
(1,486
|
)
|
|||
Accounts
payable
|
2,972
|
10,961
|
|||||
Accrued
liabilities and other
|
(77
|
)
|
2,470
|
||||
Net
cash provided by (used in) operating activities from continuing
operations
|
(828
|
)
|
916
|
||||
Net
cash provided by (used in) operating activities from discontinued
operations
|
664
|
(909
|
)
|
||||
Net
cash provided by (used in) operating activities
|
(164
|
)
|
7
|
||||
INVESTING
ACTIVITIES:
|
|||||||
Purchases
of property, plant, and equipment
|
(3,179
|
)
|
(490
|
)
|
|||
Proceeds
from sale of property, plant and equipment
|
35
|
-
|
|||||
Payments
received on notes receivables
|
115
|
117
|
|||||
Net
cash used in investing activities from continuing
operations
|
(3,029
|
)
|
(373
|
)
|
|||
Net
cash provided by investing activities from discontinued
operations
|
25
|
123
|
|||||
Net
cash used in investing activities
|
(3,004
|
)
|
(250
|
)
|
|||
FINANCING
ACTIVITIES:
|
|||||||
Net
borrowings under senior credit facility
|
5,000
|
20,814
|
|||||
Borrowings
under subordinated credit facility
|
-
|
5,707
|
|||||
Payments
under subordinated credit facility
|
(5,000
|
)
|
-
|
||||
Net
payments under former credit facility
|
-
|
(20,580
|
)
|
||||
Payments
on long-term obligations
|
(817
|
)
|
(1,127
|
)
|
|||
Borrowings
under long-term obligations
|
91
|
12
|
|||||
Additions
to deferred financing costs
|
(4
|
)
|
(324
|
)
|
|||
Termination
of interest rate swap
|
-
|
57
|
|||||
Proceeds
from the exercise of stock options
|
426
|
89
|
|||||
Net
cash (used in) provided by financing activities from continuing
operations
|
(304
|
)
|
4,648
|
||||
Net
cash used in financing activities from discontinued
operations
|
-
|
(834
|
)
|
||||
Net
cash (used in) provided by financing activities
|
(304
|
)
|
3,814
|
||||
EFFECT
OF EXCHANGE RATE CHANGES ON CASH AND TEMPORARY
INVESTMENTS
|
472
|
(288
|
)
|
||||
NET
CHANGE IN CASH AND TEMPORARY INVESTMENTS
|
(3,000
|
)
|
3,283
|
||||
CASH
AND TEMPORARY INVESTMENTS, beginning of period
|
6,147
|
2,812
|
|||||
CASH
AND TEMPORARY INVESTMENTS-DISCONTINUED OPERATIONS, beginning of
period
|
23
|
574
|
|||||
CASH
AND TEMPORARY INVESTMENTS-DISCONTINUED OPERATIONS, end of
period
|
43
|
-
|
|||||
CASH
AND TEMPORARY INVESTMENTS, end of period
|
$
|
3,127
|
$
|
6,669
|
|||
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION:
|
|||||||
Cash
payments for interest
|
$
|
1,925
|
$
|
2,204
|
|||
Cash
payments for income taxes
|
$
|
2,392
|
$
|
304
|
1. |
BASIS
OF PRESENTATION
|
2. |
BASIC
AND DILUTED INCOME PER
SHARE
|
3. |
INVENTORIES
|
June
30, 2006
|
December
31, 2005
|
||||||
Chassis
|
$
|
2,623
|
$
|
2,346
|
|||
Raw
materials
|
19,695
|
16,654
|
|||||
Work
in process
|
13,824
|
10,989
|
|||||
Finished
goods
|
11,052
|
8,329
|
|||||
$
|
47,194
|
$
|
38,318
|
4. |
LONG-LIVED
ASSETS
|
5. |
LONG-TERM
OBLIGATIONS
|
June
30,
2006
|
December
31,
2005
|
||||||
Outstanding
borrowings under Senior Credit Facility
|
$
|
10,600
|
$
|
6,300
|
|||
Outstanding
borrowings under Junior Credit Facility
|
5,000
|
10,000
|
|||||
Mortgage,
equipment and other notes payable
|
2,106
|
2,098
|
|||||
17,706
|
18,398
|
||||||
Less
current portion
|
(1,569
|
)
|
(1,595
|
)
|
|||
$
|
16,137
|
$
|
16,803
|
2007
|
$
|
1,569
|
||
2008
|
6,567
|
|||
2009
|
6,475
|
|||
2010
|
3,092
|
|||
2011
|
3
|
|||
$
|
17,706
|
6.
|
RELATED
PARTY TRANSACTIONS
|
7. |
STOCK-BASED
COMPENSATION
|
Three
Months
Ended
June 30,
2005
|
Six
Months
Ended
June 30,
2005
|
||||||
Net
income available to common shareholders, as reported
|
$
|
5,165
|
$
|
7,190
|
|||
Deduct:
Total stock-based employee compensation expense determined under
fair
value based method for all awards, net of related tax
effects
|
(84
|
)
|
(168
|
)
|
|||
Net
income available to common shareholders, pro forma
|
$
|
5,081
|
$
|
7,022
|
|||
Income
per common share:
|
|||||||
Basic,
as reported
|
$
|
0.46
|
$
|
0.65
|
|||
Basic,
pro forma
|
$
|
0.45
|
$
|
0.63
|
|||
Diluted,
as reported
|
$
|
0.45
|
$
|
0.64
|
|||
Diluted,
pro forma
|
$
|
0.45
|
$
|
0.62
|
8. |
COMMITMENTS
AND CONTINGENCIES
|
9. |
INCOME
TAXES
|
10. |
COMPREHENSIVE
INCOME
|
11. |
GEOGRAPHIC
AND CUSTOMER INFORMATION
|
For
the Three Months Ended June 30,
|
|
For
the Six Months Ended June 30,
|
|
||||||||||
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|||||
Net
Sales:
|
|||||||||||||
North
America
|
$
|
73,535
|
$
|
74,277
|
$
|
151,052
|
$
|
134,382
|
|||||
Foreign
|
18,388
|
18,661
|
34,307
|
35,452
|
|||||||||
$
|
91,923
|
$
|
92,938
|
$
|
185,359
|
$
|
169,834
|
June
30,
2006
|
December
31,
2005
|
||||||
Long
Lived Assets:
|
|||||||
North
America
|
$
|
28,323
|
$
|
26,665
|
|||
Foreign
|
2,728
|
2,509
|
|||||
$
|
31,051
|
$
|
29,174
|
12. |
DISCONTINUED
OPERATIONS
|
Three
Months Ended June 30, 2006
|
|
Three
Months Ended June 30, 2005
|
|
||||||||||||||||
|
|
Dist.
|
|
Towing
|
|
Total
|
|
Dist.
|
|
Towing
|
|
Total
|
|||||||
Net
sales
|
$
|
73
|
$
|
-
|
$
|
73
|
$
|
3,050
|
$
|
-
|
$
|
3,050
|
|||||||
Operating
income (loss)
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(34
|
)
|
$
|
-
|
$
|
(34
|
)
|
|||||
Loss
from discontinued operations
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(34
|
)
|
$
|
-
|
$
|
(34
|
)
|
Six
Months Ended June 30, 2006
|
|
Six
Months Ended June 30, 2005
|
|
||||||||||||||||
|
|
Dist.
|
|
Towing
|
|
Total
|
|
Dist.
|
|
Towing
|
|
Total
|
|||||||
Net
sales
|
$
|
360
|
$
|
-
|
$
|
360
|
$
|
5,506
|
$
|
-
|
$
|
5,506
|
|||||||
Operating
income (loss)
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(96
|
)
|
$
|
16
|
$
|
(80
|
)
|
|||||
Loss
from discontinued operations
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(96
|
)
|
$
|
16
|
$
|
(80
|
)
|
June
30, 2006
|
|
December
31, 2005
|
|
||||||||||||||||
|
|
Dist.
|
|
Towing
|
|
Total
|
|
Dist.
|
|
Towing
|
|
Total
|
|||||||
Cash
and temporary investments
|
$
|
44
|
$
|
-
|
$
|
44
|
$
|
23
|
$
|
-
|
$
|
23
|
|||||||
Accounts
receivable, net
|
236
|
426
|
662
|
1,774
|
401
|
2,175
|
|||||||||||||
Inventories
|
35
|
-
|
35
|
187
|
-
|
187
|
|||||||||||||
Prepaid
expenses and other current assets
|
6
|
-
|
6
|
37
|
-
|
37
|
|||||||||||||
Current
assets of discontinued operations held for sale
|
$
|
321
|
$
|
426
|
$
|
747
|
$
|
2,021
|
$
|
401
|
$
|
2,422
|
|||||||
Property,
plant and equipment
|
$
|
-
|
$
|
377
|
$
|
377
|
$
|
-
|
$
|
647
|
$
|
647
|
|||||||
Noncurrent
assets of discontinued operations held for sale
|
$
|
-
|
$
|
377
|
$
|
377
|
$
|
-
|
$
|
647
|
$
|
647
|
|||||||
Other
current liabilities
|
$
|
65
|
$
|
4,899
|
$
|
4,964
|
$
|
273
|
$
|
5,971
|
$
|
6,244
|
|||||||
Current
liabilities of discontinued operations held for sale
|
$
|
65
|
$
|
4,899
|
$
|
4,964
|
$
|
273
|
$
|
5,971
|
$
|
6,244
|
13. |
RECENT
ACCOUNTING PRONOUNCEMENTS
|
ITEM 2. |
MANAGEMENT’S
DISCUSSION
AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
|
ITEM 4. |
CONTROLS
AND
PROCEDURES
|
Name
|
For
|
Withheld
|
Jeffrey
I. Badgley
|
10,074,681
|
140,635
|
A.
Russell Chandler, III
|
10,074,406
|
140,910
|
Paul
E. Drack
|
10,174,678
|
40,638
|
William
G. Miller
|
8,773,019
|
1,442,297
|
Richard
H. Roberts
|
10,201,449
|
13,867
|
3.1 |
Charter,
as amended, of the Registrant (incorporated by reference to Exhibit
3.1 to
the Registrant’s Annual Report on Form 10-K, filed with the Commission on
April 22, 2002)
|
3.2 |
Bylaws
of the Registrant (incorporated by reference to Exhibit 3.2 to the
Registrant’s Registration Statement on Form S-1, filed with the Commission
in August 1994)
|
31.1 |
Certification
Pursuant to Rules 13a-14(a)/15d-14(a) by Co-Chief Executive
Officer*
|
31.2 |
Certification
Pursuant to Rules 13a-14(a)/15d-14(a) by Co-Chief Executive
Officer*
|
31.3 |
Certification
Pursuant to Rule 13a-14(a)/15d-14(a) by Chief Financial
Officer*
|
32.1 |
Certification
Pursuant to Section 1350 of Chapter 63 of Title 18 of United States
Code
by Co-Chief Executive Officer*
|
32.2 |
Certification
Pursuant to Section 1350 of Chapter 63 of Title 18 of United States
Code
by Co-Chief Executive Officer*
|
32.3 |
Certification
Pursuant to Section 1350 of Chapter 63 of Title 18 of United States
Code
by Chief Financial Officer*
|
MILLER
INDUSTRIES, INC.
By:
/s/ J. Vincent
Mish
J. Vincent Mish
Executive Vice President and Chief Financial
Officer
|