SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
þQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 2018 or
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transitionquarterly period from __________ to ___________ended October 31, 2018
Commission File No. 1-5926
| MILLER INDUSTRIES, INC. | ||
| (Exact Name of Registrant as Specified in its Charter) |
| Florida | 59-0996356 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
| 1521 | ||
| (Address of Principal Executive | ||
| (305) 621-0501 | ||
| (Registrant’s telephone number, including area | ||
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or offor such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requiredrequirements for the past 90 days.
Yes¨ Noþ
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer¨ Accelerated filer¨ Non-accelerated filerþ Smaller reporting companyþ Emerging growth company¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes¨ Noþ
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes¨ Noþ
The number of shares outstanding of each of the issuer’s classes of common stock, par value $.05 per share, as of JanuaryOctober 31, 2018 is 5,000,000 shares.
MILLER INDUSTRIES, INC.
FORM 10-Q
JanuaryOctober 31, 2018
INDEX
| |
| PART I. | FINANCIAL INFORMATION |
| FINANCIAL STATEMENTS |
BALANCE SHEET
JANUARYOctober 31, 2018
(UNAUDITED)
| ASSETS | ||||
| 2017 | ||||
| Investment Property: | ||||
| Land | $ | 161,443 | ||
| Building and Improvements | 1,049,908 | |||
| Machinery and Equipment | 11,106 | |||
| Furniture and Fixtures | 10,251 | |||
| Total Cost | $ | 1,232,708 | ||
| Less: Accumulated Depreciation | 974,733 | |||
| Net Book Value | $ | 257,975 | ||
| Other Assets: | ||||
| Cash and Cash Equivalents | $ | 1,921,574 | ||
| Accounts Receivable | ||||
| Prepaid Expenses and Other Assets | 25,548 | |||
| Loan Costs, Less Accumulated Amortization of $8,767 | 1,968 | |||
| Deferred Tax | 27,459 | |||
| Total Other Assets | $ | 1,976,549 | ||
| TOTAL ASSETS | $ | 2,234,524 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
| Liabilities: | ||||
| Mortgage and Notes Payable | $ | 992,905 | ||
| Accounts Payable and Accrued Expenses | 107,449 | |||
| Tenant Deposits and Advance Rent | 37,781 | |||
| Income Tax Payable | 674 | |||
| Total Liabilities | $ | 1,138,809 | ||
| Shareholders’ Equity: | ||||
| Common Stock - $.05 par, 5,000,000 shares Authorized; 5,000,000 shares issued and Outstanding | $ | 250,000 | ||
| Paid-In Capital | 1,212,102 | |||
| Deficit | (366,387 | ) | ||
| Total Shareholders’ Equity | $ | 1,095,715 | ||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 2,234,524 | ||
| October 31, 2018 | ||||
| ASSETS | ||||
| Investment Property: | ||||
| Land | $ | 161,443 | ||
| Building and Improvements | 1,049,908 | |||
| Machinery and Equipment | 11,106 | |||
| Furniture and Fixtures | 10,251 | |||
| Total Cost | $ | 1,232,708 | ||
| Less: Accumulated Depreciation | 983,947 | |||
| Net Book Value | $ | 248,761 | ||
| Other Assets: | ||||
| Cash and Cash Equivalents | $ | 2,022,572 | ||
| Accounts Receivable | 3,090 | |||
| Prepaid Expenses and Other Assets | 106,906 | |||
| Deferred Lease Incentive (Net of Accumulated Amortization - $55,326) | 18,758 | |||
| Deferred Tax | 23,921 | |||
| Total Other Assets | $ | 2,175,247 | ||
| TOTAL ASSETS | $ | 2,424,008 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
| Liabilities: | ||||
| Mortgage and Notes Payable | $ | 959,470 | ||
| Accounts Payable and Accrued Expenses | 189,399 | |||
| Income Tax Payable | 4,054 | |||
| Tenant’s Deposits and Advance Rent | 78,059 | |||
| Total Liabilities | $ | 1,230,982 | ||
| Shareholders’ Equity: | ||||
| Common Stock - $.05 par, 5,000,000 shares authorized; 5,000,000 shares issued and outstanding | $ | 250,000 | ||
| Paid-In Capital | 1,212,102 | |||
| Deficit | (269,076 | ) | ||
| Total Shareholders’ Equity | $ | 1,193,026 | ||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 2,424,008 | ||
See accompanying notesAccompanying Notes to financial statements.Financial Statements.
| 1 |
MILLER INDUSTRIES, INC.
BALANCE SHEET
April 30, 20172018
| ASSETS | ||||
| April 30, 2017 | ||||
| Investment Property: | ||||
| Land | $ | 161,443 | ||
| Building and Improvements | 1,049,908 | |||
| Machinery and Equipment | 11,106 | |||
| Furniture and Fixtures | 10,251 | |||
| Total Cost | $ | 1,232,708 | ||
| Less: Accumulated Depreciation | 965,819 | |||
| Net Book Value | $ | 266,889 | ||
| Other Assets: | ||||
| Cash and Cash Equivalents | $ | 2,007,930 | ||
| Accounts Receivable | 1,034 | |||
| Prepaid Expenses and Other Assets | 18,287 | |||
| Prepaid Income Taxes | 16,343 | |||
| Loan Costs, Less Accumulated Amortization of $7,962 | 2,773 | |||
| Deferred Tax | 39,804 | |||
| Total Other Assets | $ | 2,085,451 | ||
| TOTAL ASSETS | $ | 2,352,340 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
| Liabilities: | ||||
| Mortgage and Notes Payable | $ | 1,026,340 | ||
| Accounts Payable and Accrued Expenses | 160,071 | |||
| Tenant’s Deposits and Advance Rent | 182,221 | |||
| Total Liabilities | $ | 1,368,632 | ||
| Shareholders’ Equity: | ||||
| Common Stock - $.05 par, 5,000,000 shares Authorized; 5,000,000 shares issued and Outstanding | $ | 250,000 | ||
| Paid-In Capital | 1,212,102 | |||
| Deficit | (478,394 | ) | ||
| Total Shareholders’ Equity | $ | 983,708 | ||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 2,352,340 | ||
| April 30, 2018 | ||||
| ASSETS | ||||
| Investment Property: | ||||
| Land | $ | 161,443 | ||
| Building and Improvements | 1,049,908 | |||
| Machinery and Equipment | 11,106 | |||
| Furniture and Fixtures | $ | 10,251 | ||
| Total Cost | $ | 1,232,708 | ||
| Less: Accumulated Depreciation | 978,004 | |||
| Net Book Value | $ | 254,704 | ||
| Other Assets: | ||||
| Cash and Cash Equivalents | $ | 1,976,520 | ||
| Accounts Receivable (Less Allowance for Doubtful Accounts of $0 in 2018) | 1,614 | |||
| Prepaid Expenses and Other Assets | 19,057 | |||
| Prepaid Income Taxes | 24,446 | |||
| Deferred Lease Incentive (Net of Accumulated | ||||
| Amortization - $56,326 in 2018) | 18,758 | |||
| Loan Costs, Less Accumulated Amortization of $9,035 | 1,700 | |||
| Deferred Tax | 25,421 | |||
| Total Other Assets | $ | 2,067,516 | ||
| TOTAL ASSETS | $ | 2,322,220 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
| Liabilities: | ||||
| Mortgage and Notes Payable | $ | 981,760 | ||
| Accounts Payable and Accrued Expenses | 147,395 | |||
| Tenant’s Deposits and Advance Rent | 93,924 | |||
| Total Liabilities | $ | 1,223,079 | ||
| Shareholders’ Equity: | ||||
| Common Stock - $.05 par, 5,000,000 shares authorized; 5,000,000 shares issued and outstanding | $ | 250,000 | ||
| Paid-In Capital | 1,212,102 | |||
| Deficit | (362,961 | ) | ||
| Total Shareholders’ Equity | $ | 1,099,141 | ||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 2,322,220 | ||
See Accompanying Notes to Financial Statements.
STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED JANUARY 31, 2018 AND 2017
(UNAUDITED)
| 1/31/18 | 1/31/17 | |||||||
| Revenues: | ||||||||
| Rental Income | $ | 108,670 | $ | 128,416 | ||||
| Utility and Tax reimbursements | 26,776 | 38,317 | ||||||
| Other Income | 1,677 | 1,602 | ||||||
| Total Revenues | $ | 137,143 | $ | 168,335 | ||||
| Expenses: | ||||||||
| Rental Expenses (Except Interest) | $ | 83,501 | $ | 89,181 | ||||
| Administrative | 20,393 | 16,796 | ||||||
| Interest | 9,205 | 8,055 | ||||||
| Total Expenses | $ | 113,099 | $ | 114,032 | ||||
| Income Before Tax Provision | $ | 24,044 | $ | 54,303 | ||||
| Provision for Income Tax: | ||||||||
| Federal Income Tax | $ | 12,375 | $ | 18,000 | ||||
| State Income Tax | 1,000 | 2,200 | ||||||
| Total Provision for Income Tax | $ | 13,375 | $ | 20,200 | ||||
| Net Income | $ | 10,669 | $ | 34,103 | ||||
| Income per Common Share (Basic) | $ | .00 | $ | .01 | ||||
| Average Shares of Common Stock Outstanding | 5,000,000 | 5,000,000 | ||||||
See Accompanying Notes to Financial Statements.
| 2 |
STATEMENT OF OPERATIONS
FOR THE NINETHREE MONTHS ENDED JANUARYOCTOBER 31, 2018 AND 2017
(UNAUDITED)
| 1/31/18 | 1/31/17 | |||||||
| Revenues: | ||||||||
| Rental Income | $ | 425,402 | $ | 431,923 | ||||
| Utility and Tax reimbursements | 69,926 | 87,946 | ||||||
| Other Income | 5,173 | 4,854 | ||||||
| Total Revenues | $ | 500,501 | $ | 524,723 | ||||
| Expenses: | ||||||||
| Rental Expenses (Except Interest) | $ | 238,431 | $ | 262,827 | ||||
| Administrative | 54,977 | 40,337 | ||||||
| Interest | 23,711 | 21,958 | ||||||
| Total Expenses | $ | 317,119 | $ | 325,122 | ||||
| Income Before Tax Provision | $ | 183,382 | $ | 199,601 | ||||
| Provision (Benefit) for Income Tax: | ||||||||
| Federal Income Tax | $ | 62,375 | $ | 68,000 | ||||
| State Income Tax | 9,000 | 9,200 | ||||||
| Total Provision for Income Tax | $ | 71,375 | $ | 77,200 | ||||
| Net Income | $ | 112,007 | $ | 122,401 | ||||
| Income per Common Share (Basic) | $ | .02 | $ | .02 | ||||
| Average Shares of Common Stock Outstanding | 5,000.000 | 5,000,000 | ||||||
| 10/31/18 | 10/31/17 | |||||||
| Revenues: | ||||||||
| Rental Income | $ | 134,270 | $ | 159,260 | ||||
| Utilities Reimbursement | 14,597 | 23,250 | ||||||
| Insurance Reimbursement | 3,574 | - | ||||||
| Other Income | 4,127 | 1,739 | ||||||
| Total Revenues | $ | 156,568 | $ | 184,249 | ||||
| Expenses: | ||||||||
| Rental Expenses (Except Interest) | $ | 72,328 | $ | 82,636 | ||||
| Administrative | 15,913 | 23,263 | ||||||
| Interest | 7,691 | 8,023 | ||||||
| Total Expenses | $ | 95,932 | $ | 113,922 | ||||
| Income Before Tax Provision | $ | 60,636 | $ | 70,327 | ||||
| Provision for Income Tax: | ||||||||
| Federal Income Tax | $ | 11,000 | $ | 23,000 | ||||
| State Income Tax | 3,000 | 4,000 | ||||||
| Total Provision for Income Tax | $ | 14,000 | $ | 27,000 | ||||
| Net Income | $ | 46,636 | $ | 43,327 | ||||
| Income per Common Share (Basic) | $ | .01 | $ | .01 | ||||
| Average Shares of Common Stock Outstanding | 5,000,000 | 5,000,000 | ||||||
See Accompanying Notes to Financial Statements.
| 3 |
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED OCTOBER 31, 2018 AND 2017
(UNAUDITED)
| 10/31/18 | 10/31/17 | |||||||
| Revenues: | ||||||||
| Rental Income | $ | 267,871 | $ | 316,732 | ||||
| Utilities Reimbursement | 27,915 | 43,130 | ||||||
| Insurance Reimbursement | 3,574 | — | ||||||
| Other Income | 8,174 | 3,496 | ||||||
| Total Revenues | $ | 307,534 | $ | 363,358 | ||||
| Expenses: | ||||||||
| Rental Expenses (Except Interest) | $ | 138,870 | $ | 154,804 | ||||
| Administrative | 27,551 | 34,712 | ||||||
| Interest | 17,228 | 14,505 | ||||||
| Total Expenses | $ | 183,649 | $ | 204,021 | ||||
| Income Before Tax Provision | $ | 123,885 | $ | 159,337 | ||||
| Provision for Income Tax: | ||||||||
| Federal Income Tax | $ | 24.000 | $ | 50,000 | ||||
| State Income Tax | 6,000 | 8,000 | ||||||
| Total Provision for Income Tax | $ | 30,000 | $ | 58,000 | ||||
| Net Income | $ | 93,885 | $ | 101,337 | ||||
| Income per Common Share (Basic) | $ | .01 | $ | .01 | ||||
| Average Shares of Common Stock Outstanding | 5,000,000 | 5,000,000 | ||||||
See Accompanying Notes to Financial Statements.
| 4 |
STATEMENT OF CASH FLOWS
FOR THE NINESIX MONTHS ENDED JANUARYOCTOBER 31, 2018 AND 2017
(UNAUDITED)
| 1/31/18 | 1/31/17 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net Income | $ | 112,007 | $ | 122,401 | ||||
| Adjustments to Reconcile Net Income to Net Cash Provided by (used for) Operating Activities: | ||||||||
| Provision for Bad Debts | ||||||||
| Depreciation | 8,914 | 8,914 | ||||||
| Amortization | 7,142 | |||||||
| Changes in Operating Assets and Liabilities | (173,842 | ) | (60,388 | ) | ||||
| Net Cash Provided by Operating Activities | $ | (52,921 | ) | 78,069 | ||||
| Cash Flows from Investing Activities: | ||||||||
| Acquisition of Property, Equipment, and Intangible | $ | $ | ||||||
| Net Cash (used by) Investing Activities | $ | $ | ||||||
| Cash Flows from Financing Activities: | ||||||||
| Principal Payments Under Borrowings | $ | (33,435 | ) | $ | (33,435 | ) | ||
| Net Cash Provided by (used by) Financing Activities | $ | (33,435 | ) | $ | (33,435 | ) | ||
| Net Increase in Cash and Cash Equivalents | $ | (86,356 | ) | $ | 44,634 | |||
| Cash and Cash Equivalents at the Beginning of Year | 2,007,930 | 1,817,572 | ||||||
| Cash and Cash Equivalents at the End of Quarter | $ | 1,921,574 | $ | 1,862,206 | ||||
| Additional Cash Flow Information: | ||||||||
| Cash Payments During the Year | ||||||||
| Interest | $ | 25,250 | $ | 23,431 | ||||
| Income Taxes | $ | 42,733 | $ | 65,577 | ||||
| 10/31/18 | 10/31/17 | |||||||
| Cash Flows from Operating Activities: | ||||||||
| Net Income | $ | 93,885 | $ | 101,337 | ||||
| Adjustments to Reconcile Net Income to Net Cash Provided by (used for) Operating Activities: | ||||||||
| Depreciation | 5,943 | 5,943 | ||||||
| Amortization | 537 | 537 | ||||||
| Changes in Operating Assets and Liabilities | (32,023 | ) | (100,706 | ) | ||||
| Net Cash Provided by Operating Activities | $ | 68,342 | $ | 7,111 | ||||
| Cash Flows from Investing Activities: | ||||||||
| Acquisition of Property, Equipment, and Intangible | $ | (— | ) | $ | (— | ) | ||
| Net Cash (used by) Investing Activities | $ | (— | ) | $ | (— | ) | ||
| Cash Flows from Financing Activities: | ||||||||
| Principal Payments Under Borrowings | $ | (22,290 | ) | $ | (22,290 | ) | ||
| Net Cash Provided by (used by) Financing Activities | $ | (22,290 | ) | $ | (22,290 | ) | ||
| Net Increase (Decrease) in Cash and Cash Equivalents | $ | 46,052 | $ | (15,179 | ) | |||
| Cash and Cash Equivalents at the Beginning of Year | $ | 1,976,520 | $ | 2,007,930 | ||||
| Cash and Cash Equivalents at the End of Quarter | $ | 2,022,572 | $ | 1,992,751 | ||||
| Additional Cash Flow Information: | ||||||||
| Cash Payments During the Year | ||||||||
| Interest | $ | 19,068 | $ | 13,968 | ||||
| Income Taxes | $ | - | $ | 22,733 | ||||
See Accompanying Notes to Financial Statements.
| 5 |
NOTES TO FINANCIAL STATEMENTS
JANUARY
OCTOBER 31, 2018
(UNAUDITED)
(UNAUDITED)
NOTENote A – BASIS OF PRESENTATIONBasis of Presentation
The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the ninesix month period ending JanuaryOctober 31, 2018 are not necessarily indicative of results that may be expected for the year ended April 30, 2018.2019.
For further information refer to the financial statements and footnotes thereto of the Company as of April 30, 20172018 and for the year ended April 30, 2017.2018.
NOTENote B - Earnings Per Share -
Basic earnings per share (“EPS”) is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants). Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive.
NOTE C - Use ofOf Estimates -
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The most significant estimates included in the preparation of the financial statements are related to income taxes, asset lives, accruals and valuation allowances.
NOTE D – Commitments, Contingent Liabilities, Other Matters and Subsequent Events
On December 22, 2017, the TaxThe “Tax Cuts and Jobs Act (TCTA)Act” was enacted.signed into law on December 22, 2017. The Act includes a number of“Act” changes to the existingcurrent tax code, most notably a reduction ofsystem for corporations, generally beginning with taxable years starting after December 31, 2017. The bill reduces the USU.S. corporate income tax rate from a graduated set of rates with a maximum of 35 percent tax rate to a flat rate of 21%.21 percent tax rate. Additionally, the bill introduces many changes that impact corporations some of which isare the net operating loss deduction subject to annual limitations, interest expense deduction subject to annual limitations, elimination of the alternative minimum tax and immediate expensesexpensing of the full cost of qualified property.
Changes in tax rates and tax laws are accounted for the in the period of enactment. Therefore the net deferred tax assets were reduced by $10,125 with a corresponding adjustment to current period tax expense for the remeasurement of the Company’s U.S. deferred tax assets. Our federal income tax expense for the periods beginning in 2018 will be based on the new rate.
Starting on Feb. 1, 2018 a three-year lease has been agreed upon with a third party lessee for 2,935 square feet of space. Lease terms are a total rent of $129,914 for the three years with the lease having an option to extend the lease an additional three years.
| 6 |
Under U.S. Accounting Standards, Codification Topic 740, Accounting for Income Taxes requires re-measurement of all U.S. deferred income tax assets and liabilities for temporary differences and NOL carryforwards from the current rate of 35 percent to the new corporate rate of 21 percent. The cumulative adjustment will be recognized in income tax expense from continuing operations as a discrete item in the period that includes the enactment date (December 22, 2017).
The Company recorded the re-measurement of its U.S. deferred income tax assets on December 22, 2017 as a reduction in deferred income taxes of approximately $10,000. A similar amount was recognized as income tax expense at December 22, 2017.
In accordance with SFAS (ASC 855-10), Management has performed an evaluation of subsequent events through the date that the financial statements were issued and has determined that it does not have any material subsequent events to disclose in these financials.
| 7 |
| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Results of Operations (Third(Second Quarter of 2019 Fiscal Year compared to Second Quarter of 2018 Fiscal Year and Six Months of 2019 Fiscal Year compared to Third QuarterSix Months of 20172018 Fiscal Year)
Rental Income. The Company’s results of operations are primarily dependent upon the rental income which it receives from leasing space in its building. Rental income is a function of the percentage of the building which is occupied and the level of rental rates. Rental income throughduring the thirdsecond quarter of 20172018 was $432,000,$159,000, compared to $425,000$134,000 in the thirdsecond quarter of 2018.2019. Rental income during the first two quarters of 2018 was $317,000 and in 2019 was $268,000.
Other Income. The Company generated other income of $4,854 through$1,750 in the thirdsecond quarter of 2018 and $4,100 in 2019. The Company generated $3,500 in the first two quarters of fiscal year 20172018 and $5,173$8,200 in the third quarterfirst two quarters of 2018. Other income2019. Income in these quarters consisted of interest income and miscellaneous income.
Rental Expense (Excluding Interest). The Company incurs rental expense in connection with the leasing of its building. These expenses consist of management fees, insurance, real estate taxes, depreciation and amortization, maintenance and repairs, utility costs and outside services. Rental expenses were $263,000 through$83,000 in the thirdsecond quarter of 20172018 and $238,000 through$72,000 in the thirdsecond quarter of 2018.2019. Rental expenses were $155,000 in the first two quarters of 2018 and $139,000 in the first two quarters of 2019.
Administrative Expenses. The Company’s administrative expenses were $40,000$23,000 in the second quarter of 2018 and $16,000 in 2019 and $35,000 in the first threetwo quarters of fiscal years 2017year 2018 and $55,000 for 2018.$28,000 in 2019.
Interest Expense. The Company pays interest on the mortgage loan on its building. Interest expense on the loan was $22,000$8,000 in the second quarter of fiscal year 2018 and 2019 and $15,000 in the first threetwo quarters of fiscal years 2017year 2018 and $23,700 for 2018.$17,000 in the first two quarters of 2019.
Provision for Income Taxes. The Company had a tax provision of $77,200$27,000 for the second quarter of fiscal 2018 and $14,000 for the second quarter of fiscal year 2019 and $58,000 in the first three quartertwo quarters of fiscal 20172018 and $71,375$30,000 in 2018.2019.
Net Income.Income. As a result of the foregoing factors, Thethe Company had net income of $122,500$43,000 in the second quarter of fiscal 2018 and $47,000 in the second quarter of 2019 and $101,000 in the first threetwo quarters of fiscal 20172018 and $112,000$94,000 in the first threetwo quarters of 2018.2019.
Liquidity and Capital Resources
The Company’s cash increaseddecreased by $45,000$15,000 during the ninefirst six months of fiscal year 20172018 compared to an decreaseincrease of $86,000$46,000 during the first ninesix months of fiscal year 2018.2019. As of JanuaryOctober 31, 2018, Thethe Company’s cash position was approximately $1,921,000.$2,023,000.
| 8 |
Current Operations
The Company operates as a real estate investment and management company. The Company is currently seeking to obtain additional commercial tenants for its existing building.
The Company’s principal operating expenses consist of management and professional fees associated with the administration of the Company, interest expense on the Company’s mortgage loan, real estate taxes and insurance.
| 9 |
| ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
We are a smaller reporting issuercompany as defined in Item 10 of Regulation S-KRule 12b-2 and are not required to report the quantitative and qualitative measures of market risk specified in Item 305 of Regulation S-K.
| ITEM 4. | CONTROLS AND PROCEDURES |
In connection with the filing of this Form 10-Q, the Company’s Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of the Company’s disclosure controls and procedures as of JanuaryOctober 31, 2018. The Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of JanuaryOctober 31, 2018.
There were no changes in the Company’s internal controls over financial reporting that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting during the fiscal quarter ended JanuaryOctober 31, 2018.
| 10 |
| PART II. | OTHER INFORMATION |
| ITEM 6. | EXHIBITS |
| * Furnished herewith | |||
Not applicable.
| 11 |
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| MILLER INDUSTRIES, INC. | ||||
| (Registrant) | ||||
| Dated: | March 15, 2019 | By: | /s/ Marc Napolitano | |
| Marc Napolitano | ||||
| Chief Executive Officer | |||
| Principal Financial Officer | ||||
| 12 |