MILLER INDUSTRIES INC /TN/ Q4 FY2024 earnings call

• Miller Industries had a record year in 2024 with record revenue, gross profit, net income, and EPS. • Full year gross margin improved due to product mix and supply chain improvements. • Fourth quarter sales decrease was driven by chassis shipment decline. • Inventory levels are normalizing, with receivables expected to decrease. • CARB regulations limit sales in certain states, but suppliers are working on compliant chassis. • Military recovery vehicle contracts, like with Rheinmetall Canada, present future growth opportunities. • Capital allocation includes returning cash to shareholders, reducing debt, and potential capacity expansion. • Plan to launch new products across all categories for innovation and growth.

Full year 2024: Net sales were $1.26 billion, an increase of 9% from the prior year's $1.15 billion. Gross profit was $170.8 million (13.6% of sales) compared to $151.9 million (13.2% of sales) in 2023. Net income was $63.5 million ($5.47 per diluted share) vs. $58.3 million ($5.07 per diluted share) in 2023. Fourth quarter 2024: Sales were $221.9 million, a 25.1% decrease from $296.2 million in Q4 2023. Gross profit was $33.5 million (15.1% of sales) vs. $38.6 million (13% of sales) in Q4 2023. Net income was $10.5 million ($0.91 per diluted share) vs. $16.7 million ($1.45 per diluted share) in Q4 2023.

• Anticipates $950 million to $1 billion in revenue in 2025, with EPS range $2.90 to $3.20 per diluted share. • Expect supply chain volatility to subside in second half of 2025, normalizing chassis deliveries. • Military contracts start production in late 2026/2027. • Aim to reduce working capital to historical levels (~20% of revenue pre-COVID).

• Tariffs create uncertainty in the global supply chain. • CARB regulations limit product sales in certain states. • Supply chain volatility, especially with chassis deliveries, causing revenue and margin fluctuations. • Rising cost of equipment ownership putting pressure on end-market customers.

Q: Does the 2025 outlook include financial effects of military developments?

A: Most military contract production begins in late 2026 with revenue impact in 2027/2028.

Q: Compare first half vs second half 2025?

A: Q1 and Q2 likely similar to Q4 2024 with lower chassis shipments, then upward momentum in back half.

Q: Will margin levels be the same as 2024?

A: Anticipate margins to be relatively equal to last year.

Q: Inventory management and working capital?

A: Plan to reduce inventories to historical levels strategically, aiming for working capital to return to pre-COVID levels.

Q: Help for dealers with inventory?

A: Dealers are healthy, working through chassis inventory buildup, expected to return to optimal levels in 2-4 months.