A temporary supply slowdown from one of its chassis manufacturers cut sales and profits for Miller Industries Inc. during the third quarter, but company CEO Jeff Badgley said those issues have been corrected and the tow truck maker said its business remains solid.
The Ooltewah-based towing equipment manufacturer said its sales in the third quarter were off 0.1% from a year ago and its net income fell by 6.9% compared with the third quarter of 2018. Miller Industries earned $8.1 million, or 71 cents per share, on sales of $195.5 million in the three months ended Sept. 30. A year earlier, Miller reported net income of $8.7 million, or 76 cents per share, on sales of $195.7 million.
"We delivered solid third quarter results even though our third quarter revenue was negatively impacted by temporary supply chain dynamics with certain chassis manufacturers," Badgley said in the earnings report released after the market closed.
"Those dynamics negatively impacted deliveries to both our plants and our distributors but have since been corrected by our key suppliers and are not expected to impact the fourth quarter. Despite those setbacks, we were able to increase gross profits by 1.3% year-over-year and expand our gross margins by 10 basis points due to our strong cost control discipline."
Badgley said Miller Industries continued to invest in its business by adding to its marketing efforts and software capabilities and he said he expects stronger international sales in the fourth quarter.
"As we move toward year end, we remain confident in the underlying strength of our business, as we are committed to providing best-in-class service to our customers while investing for long-term growth," Badgley said.
For the first nine months of the year, Miller Industries net sales were up 15.7% over last year to $615 million and net income was up 19.5% to $27.4 million, or $2.41 per diluted share.
The company also announced Wednesday that it will pay a quarterly dividend of 18 cents per share on Dec. 16 to shareholders of record as of Dec. 9.
Ahead of the earnings announcement, shares of Miller Industries fell Wednesday by 2.2% to $36.60. But so far in 2019, Miller Industries shares are up nearly 38%.